EXHIBIT 99.1
The Pooling and Servicing Agreement
<PAGE>
EXECUTION COPY
==============================
CWALT, INC.,
Depositor
COUNTRYWIDE HOME LOANS, INC.,
Seller
PARK GRANADA LLC,
Seller
PARK MONACO INC.,
Seller
PARK SIENNA LLC,
Seller
COUNTRYWIDE HOME LOANS SERVICING LP,
Master Servicer
and
THE BANK OF NEW YORK,
Trustee
___________________________________
POOLING AND SERVICING AGREEMENT
Dated as of November 1, 2006
___________________________________
ALTERNATIVE LOAN TRUST 2006-39CB
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2006-39CB
==============================
<PAGE>
Table of Contents
Page
----
ARTICLE I DEFINITIONS
SECTION 1.01.
Defined
Terms................................................I-1
SECTION 1.02.
Certain Interpretive
Provisions.............................I-34
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND
WARRANTIES
SECTION 2.01.
Conveyance of Mortgage
Loans................................II-1
SECTION 2.02.
Acceptance by Trustee of the Mortgage
Loans.................II-7
SECTION 2.03.
Representations, Warranties and Covenants of
the Sellers and Master
Servicer...........................II-10
SECTION 2.04.
Representations and Warranties of the Depositor as to
the Mortgage
Loans.........................................II-13
SECTION 2.05.
Delivery of Opinion of Counsel in Connection with
Substitutions..............................................II-13
SECTION 2.06.
Execution and Delivery of
Certificates.....................II-14
SECTION 2.07.
REMIC
Matters..............................................II-14
SECTION 2.08.
Covenants of the Master
Servicer...........................II-14
ARTICLE III ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
SECTION 3.01.
Master Servicer to Service Mortgage
Loans..................III-1
SECTION 3.02.
Subservicing; Enforcement of the Obligations of
Subservicers...............................................III-2
SECTION 3.03.
Rights of the Depositor and the Trustee in Respect of
the Master
Servicer........................................III-2
SECTION 3.04.
Trustee to Act as Master
Servicer..........................III-2
SECTION 3.05.
Collection of Mortgage Loan Payments, the Certificate
Account the Distribution Account, the Supplemental
Interest Trust, the Corridor Contract Reserve Fund,
the Pre-funding Account and the Capitalized Interest
Account....................................................III-3
SECTION 3.06.
Collection of Taxes, Assessments and Similar Items;
Escrow
Accounts............................................III-7
SECTION 3.07.
Access to Certain Documentation and Information Regarding
the Mortgage
Loans.........................................III-7
SECTION 3.08.
Permitted Withdrawals from the Certificate Account,
the Distribution Account and the Corridor Contract
Reserve
Fund...............................................III-7
SECTION 3.09.
Maintenance of Hazard Insurance; Maintenance of
Primary Insurance
Policies.................................III-9
SECTION 3.10.
Enforcement of Due-on-Sale Clauses; Assumption
Agreements.III-10
SECTION 3.11.
Realization Upon Defaulted Mortgage Loans; Repurchase of
Certain Mortgage
Loans....................................III-11
SECTION 3.12.
Trustee to Cooperate; Release of Mortgage
Files...........III-14
SECTION 3.13.
Documents, Records and Funds in Possession of
Master Servicer to be Held for the
Trustee................III-15
SECTION 3.14.
Servicing
Compensation....................................III-15
SECTION 3.15.
Access to Certain
Documentation...........................III-16
SECTION 3.16.
Annual Statement as to
Compliance.........................III-16
SECTION 3.17.
Errors and Omissions Insurance; Fidelity
Bonds............III-17
SECTION 3.18.
The Corridor
Contracts....................................III-17
i
<PAGE>
ARTICLE IV DISTRIBUTIONS AND ADVANCES BY THE MASTER SERVICER
SECTION 4.01.
Advances....................................................IV-1
SECTION 4.02.
Priorities of
Distribution..................................IV-2
SECTION 4.03.
[Reserved]..................................................IV-8
SECTION 4.04.
Allocation of Realized
Losses...............................IV-8
SECTION 4.05.
Cross-Collateralization; Adjustments to Available
Funds....IV-10
SECTION 4.06.
Monthly Statements to
Certificateholders...................IV-10
SECTION 4.07.
Determination of Pass-Through Rates for COFI
Certificates..IV-11
SECTION 4.08.
Determination of Pass-Through Rates for LIBOR
Certificates.IV-11
SECTION 4.09.
Distributions from the Corridor Contract Reserve
Fund......IV-13
ARTICLE V THE CERTIFICATES
SECTION 5.01.
The
Certificates.............................................V-1
SECTION 5.02.
Certificate Register; Registration of Transfer and
Exchange of
Certificates.....................................V-1
SECTION 5.03.
Mutilated, Destroyed, Lost or Stolen
Certificates............V-5
SECTION 5.04.
Persons Deemed
Owners........................................V-6
SECTION 5.05.
Access to List of Certificateholders' Names and
Addresses....V-6
SECTION 5.06.
Maintenance of Office or
Agency..............................V-6
ARTICLE VI THE DEPOSITOR AND THE MASTER SERVICER
SECTION 6.01.
Respective Liabilities of the Depositor and
the Master
Servicer.........................................VI-1
SECTION 6.02.
Merger or Consolidation of the Depositor or
the Master
Servicer.........................................VI-1
SECTION 6.03.
Limitation on Liability of the Depositor, the Sellers,
the Master Servicer and
Others..............................VI-1
SECTION 6.04.
Limitation on Resignation of Master
Servicer................VI-2
ARTICLE VII DEFAULT
SECTION 7.01.
Events of
Default..........................................VII-1
SECTION 7.02.
Trustee to Act; Appointment of
Successor...................VII-3
SECTION 7.03.
Notification to
Certificateholders.........................VII-4
ARTICLE VIII CONCERNING THE TRUSTEE
SECTION 8.01.
Duties of
Trustee.........................................VIII-1
SECTION 8.02.
Certain Matters Affecting the
Trustee.....................VIII-2
SECTION 8.03.
Trustee Not Liable for Certificates or Mortgage
Loans.....VIII-3
SECTION 8.04.
Trustee May Own
Certificates..............................VIII-3
SECTION 8.05.
Trustee's Fees and
Expenses...............................VIII-3
SECTION 8.06.
Eligibility Requirements for
Trustee......................VIII-3
SECTION 8.07.
Resignation and Removal of
Trustee........................VIII-4
SECTION 8.08.
Successor
Trustee.........................................VIII-5
SECTION 8.09.
Merger or Consolidation of
Trustee........................VIII-5
SECTION 8.10.
Appointment of Co-Trustee or Separate
Trustee.............VIII-5
SECTION 8.11.
Tax
Matters...............................................VIII-7
SECTION 8.12.
Monitoring of Significance
Percentage.....................VIII-8
ii
<PAGE>
ARTICLE IX TERMINATION
SECTION 9.01.
Termination upon Liquidation or Purchase of
all Mortgage
Loans..........................................IX-1
SECTION 9.02.
Final Distribution on the
Certificates......................IX-1
SECTION 9.03.
Additional Termination
Requirements.........................IX-2
ARTICLE X MISCELLANEOUS PROVISIONS
SECTION 10.01.
Amendment....................................................X-1
SECTION 10.02.
Recordation of Agreement;
Counterparts.......................X-2
SECTION 10.03.
Governing
Law................................................X-2
SECTION 10.04.
Intention of
Parties.........................................X-2
SECTION 10.05.
Notices......................................................X-4
SECTION 10.06.
Severability of
Provisions...................................X-5
SECTION 10.07.
Assignment...................................................X-5
SECTION 10.08.
Limitation on Rights of
Certificateholders...................X-5
SECTION 10.09.
Inspection and Audit
Rights..................................X-6
SECTION 10.10.
Certificates Nonassessable and Fully
Paid....................X-6
SECTION 10.11.
[Reserved]...................................................X-6
SECTION 10.12.
Protection of
Assets.........................................X-6
ARTICLE XI EXCHANGE ACT REPORTING
SECTION 11.01. Filing
Obligations..........................................XI-1
SECTION 11.02. Form
10-D Filings...........................................XI-1
SECTION 11.03. Form
8-K Filings............................................XI-2
SECTION 11.04. Form
10-K Filings...........................................XI-2
SECTION 11.05.
Sarbanes-Oxley
Certification................................XI-2
SECTION 11.06. Form 15
Filing..............................................XI-3
SECTION 11.07. Report
on Assessment of Compliance and Attestation..........XI-3
SECTION 11.08. Use of
Subservicers and Subcontractors......................XI-4
SECTION 11.09.
Amendments..................................................XI-5
SECTION 11.10.
Reconciliation of
Accounts..................................XI-5
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
Inc.......S-II-C-1
Schedule II-D
Representations and Warranties of Park Sienna
LLC.......S-II-D-1
Schedule III-A: Representations and Warranties of Countrywide as
to
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 Inc.
as to the Park Monaco Inc. Mortgage
Loans..............S-III-D-1
Schedule III-E
Representations and Warranties of Park Sienna LLC
as to the Park Sienna LLC 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-I
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:
[Reserved].................................................C-2-1
Exhibit D: Form of
Notional Amount Certificate..........................D-1
Exhibit E: Form of
Reverse of Certificates..............................E-1
Exhibit F-1: Form of Initial
Certification of Trustee
(Initial Mortgage
Loans)...................................F-1-1
Exhibit F-2: Form of Initial
Certification of Trustee
(Supplemental Mortgage
Loans)..............................F-2-1
Exhibit G-1: Form of Delay Delivery
Certification of Trustee
(Initial Mortgage
Loans)...................................G-1-1
Exhibit G-2: Form of Delay Delivery
Certification of Trustee
(Supplemental Mortgage
Loans)..............................G-2-1
Exhibit H-1: Form of Final
Certification of Trustee
(Initial Mortgage
Loans)...................................H-1-1
Exhibit H-2: Form of Final
Certification of Trustee
(Supplemental Mortgage
Loans)..............................H-2-1
Exhibit I: Form of
Transfer Affidavit...................................I-1
Exhibit J-1: Form of Transferor
Certificate (Residual)..................J-1-1
Exhibit J-2: Form of Transferor
Certificate (Private)...................J-2-1
Exhibit K: Form of
Investment Letter [Non-Rule 144A]....................K-1
Exhibit L-1: Form of Rule 144A
Letter...................................L-1-1
Exhibit L-2: Form of 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
Exhibit P: Form of
Supplemental Transfer Agreement......................P-1
Exhibit Q: Standard
& Poor's LEVELS(R) Version 5.7 Glossary Revised,
Appendix
E...................................................Q-1
iv
<PAGE>
Exhibit R: Form of
Corridor Contract....................................R-1
Exhibit S-1: Form of Novation
Confirmation..............................S-1-1
Exhibit S-2:
[Reserved].................................................S-2-1
Exhibit T:
[Reserved]...................................................T-1
Exhibit U: Monthly
Report...............................................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 of Master
Servicer).............................Y-1
v
<PAGE>
THIS POOLING AND SERVICING AGREEMENT, dated as of November 1,
2006,
among CWALT, INC., a Delaware corporation, as depositor (the
"Depositor"),
COUNTRYWIDE HOME LOANS, INC. ("Countrywide"), a New York
corporation, as a
seller (a "Seller"), PARK GRANADA LLC ("Park Granada"), a Delaware
limited
liability company, as a seller (a "Seller"), PARK MONACO INC.
("Park Monaco"), a
Delaware corporation, as a seller (a "Seller"), PARK SIENNA LLC
("Park Sienna"),
a Delaware limited liability company, as a seller (a "Seller")
COUNTRYWIDE HOME
LOANS SERVICING LP, a Texas limited partnership, as master servicer
(the "Master
Servicer"), and THE BANK OF NEW YORK, a banking corporation
organized under the
laws of the State of New York, as trustee (the "Trustee").
WITNESSETH THAT
In consideration of the mutual agreements herein contained, the
parties hereto 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. For federal income tax
purposes, the
Trust Fund (other than the Pre-funding Account and the Capitalized
Interest
Account) will consist of three real estate mortgage investment
conduits (each a
"REMIC" or, in the alternative, the "Lower Tier REMIC," the "Middle
Tier REMIC"
and the "Master REMIC," respectively). 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
the Lower
Tier REMIC, the Middle Tier REMIC and the Master REMIC. The Master
REMIC will
hold as assets the several classes of uncertificated Middle Tier
REMIC Interests
(other than the Class MTR-A-R Interest). The Middle Tier REMIC will
hold as
assets the several classes of uncertificated Lower Tier REMIC
Interests (other
than the Class LTR-A-R Interest). The Lower Tier REMIC will hold as
assets all
property of the Trust Fund (other than the Pre-funding Account and
the
Capitalized Interest Account). Each Middle Tier REMIC Interest
(other than the
Class MTR-A-R Interest) is hereby designated as a regular interest
in the Middle
Tier REMIC and each Lower Tier REMIC Interest (other than the Class
LTR-A-R
Interest) is hereby designated as a regular interest in the Lower
Tier REMIC .
The latest possible maturity date of all REMIC regular interests
created herein
shall be the Latest Possible Maturity Date.
The Corridor
Contracts, the Supplemental Interest Trust and the Corridor
Contract Reserve Fund will not form part of any REMIC.
<PAGE>
The
following table sets forth characteristics of the Master REMIC
Certificates, together with the minimum denominations and integral
multiples in
excess thereof in which such Classes shall be issuable (except that
one
Certificate of each Class of Certificates may be issued in a
different amount
and, in addition, one Residual Certificate representing the Tax
Matters Person
Certificate may be issued in a different amount):
<TABLE>
<CAPTION>
======================================================================================================================
Pass-Through
Initial Class
Rate
Integral Multiples
Class
Designation
Certificate Balance
(per annum)
Minimum Denomination in Excess of Minimum
------------------------- ------------------------
--------------------- ----------------------
----------------------
<S>
<C>
<C>
<C>
<C>
Class 1-A-1
$40,000,000
6.00%
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 1-A-2
$3,810,000
(1)
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 1-A-3
$635,000
(2)
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 1-A-4
$13,502,000
6.00%
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 1-A-5
$2,339,000
6.00%
$1,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 1-A-6
$60,000,000
(3)
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 1-A-7
$60,000,000(4)
(5)
$25,000.00(6)
$1.00(6)
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 1-A-8
$20,000,000
6.00%
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 1-A-9
$9,735,000
6.00%
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 1-A-10
$78,000,000
6.00%
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 1-A-11
$100,000,000
(7)
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 1-A-12
$100,000,000(8)
(9)
$25,000.00(6)
$1.00(6)
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 1-A-13
$247,000
6.00%
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 1-A-14
$7,330,286
(10)
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 1-A-15
$1,221,714
(11)
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 1-A-16
$37,094,000
6.00%
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 1-A-17
$139,510,000
6.00%
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 1-A-18
$28,876,000
6.00%
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 1-A-19
$16,498,000
6.00%
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 1-A-20
$30,000,000
6.00%
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 2-A-1
$106,071,428
(12)
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 2-A-2
$176,056,778(13)
(14)
$25,000.00(6)
$1.00(6)
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 2-A-3
$6,520,622
(15)
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 2-A-4
$66,431,250
(16)
$1,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 2-A-5
$3,554,100
(17)
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 1-X
$500,143,577(18)
(19)
$25,000.00(6)
$1.00(6)
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 2-X
$189,999,376(20)
(21)
$25,000.00(6)
$1.00(6)
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class PO
$2,843,632
(22)
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class A-R(23)
$100
6.00%
(24)
(24)
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class M-1
$15,542,000
(25)
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class M-2
$4,090,000
(25)
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class M-3
$6,135,000
(25)
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class M-4
$2,045,000
(25)
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class M-5
$2,044,000
(25)
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class M-6
$2,454,000
(25)
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class M-7
$1,227,000
(25)
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class B-1
$1,227,000
(25)
$25,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class B-2
$1,227,000
(25)
$100,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class B-3
$2,045,000
(25)
$100,000.00
$1.00
======================================================================================================================
2
<PAGE>
======================================================================================================================
Class B-4
$3,272,000
(25)
$100,000.00
$1.00
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class B-5
$2,454,672
(25)
$100,000.00
$1.00
======================================================================================================================
</TABLE>
__________________________________________
(1) The Class 1-A-2
Certificates will bear interest during each Interest
Accrual Period at a per annum rate of LIBOR plus 0.75%, subject to
a
maximum and minimum Pass-Through Rate of 7.00% and 0.75% per
annum,
respectively. The Pass-Through Rate for the Class 1-A-2
Certificates for
the
Interest Accrual Period for the first Distribution Date is 6.07%
per
annum.
(2) The Class 1-A-3
Certificates will bear interest during each Interest
Accrual Period at a per annum rate equal to 37.50% minus (6.00 x
LIBOR),
subject to a maximum
and minimum Pass-Through Rate of 37.50% and 0.00% per
annum, respectively. The Pass-Through Rate for the Class 1-A-3
Certificates
for
the Interest Accrual Period for the first Distribution Date is
5.58%
per
annum.
(3) The Class 1-A-6
Certificates will bear interest during each Interest
Accrual Period at a per annum rate of LIBOR plus 0.60%, subject to
a
maximum and minimum Pass-Through Rate of 6.00% and 0.60% per
annum,
respectively. The Pass-Through Rate for the Class 1-A-6
Certificates for
the
Interest Accrual Period for the first Distribution Date is 5.92%
per
annum.
(4) The Class 1-A-7
Certificates will be a Class of Notional Amount
Certificates, will have no Class Certificate Balance and will bear
interest
on
its Notional Amount.
(5) The Class 1-A-7
Certificates will bear interest during each Interest
Accrual Period at a per annum rate of 5.40% minus LIBOR, subject to
a
maximum and minimum Pass-Through Rate of 5.40% and 0.00% per
annum,
respectively. The Pass-Through Rate for the Class 1-A-7
Certificates for
the
Interest Accrual Period for the first Distribution Date is 0.08%
per
annum.
(6) Minimum
denomination is based on the Notional Amount of such Class.
(7) The Class 1-A-11
Certificates will bear interest during each Interest
Accrual Period at a per annum rate of LIBOR plus 0.65%, subject to
a
maximum and minimum Pass-Through Rate of 6.00% and 0.65% per
annum,
respectively. The Pass-Through Rate for the Class 1-A-11
Certificates for
the
Interest Accrual Period for the first Distribution Date is 5.97%
per
annum.
(8) The Class 1-A-12
Certificates will be a Class of Notional Amount
Certificates, will have no Class Certificate Balance and will bear
interest
on
its Notional Amount.
(9) The Class 1-A-12
Certificates will bear interest during each Interest
Accrual Period at a per annum rate of 5.35% minus LIBOR, subject to
a
maximum and minimum Pass-Through Rate of 5.35% and 0.00% per
annum,
respectively. The Pass-Through Rate for the Class 1-A-12
Certificates for
the
Interest Accrual Period for the first Distribution Date is 0.03%
per
annum.
(10) The Class 1-A-14 Certificates will bear interest during each
Interest
Accrual Period at a per annum rate of LIBOR plus 0.75%, subject to
a
maximum and minimum Pass-Through Rate of 7.00% and 0.75% per
annum,
respectively. The Pass-Through Rate for the Class 1-A-14
Certificates for
the Interest Accrual Period
for the first Distribution Date is 6.07% per
annum.
(11) The Class 1-A-15 Certificates will bear interest during each
Interest
Accrual Period at a per annum rate equal to 37.50% minus (6.00 x
LIBOR),
subject to a maximum and minimum Pass-Through Rate of 37.50% and
0.00% per
annum, respectively. The Pass-Through Rate for the Class 1-A-15
Certificates for the Interest Accrual Period for the first
Distribution
Date
is 5.58% per annum.
3
<PAGE>
(12) The Class 2-A-1 Certificates will bear interest during each
Interest
Accrual Period at a per annum rate of LIBOR plus 0.45%, subject to
a
maximum and minimum Pass-Through Rate of 7.00% and 0.45% per
annum,
respectively. The Pass-Through Rate for the Class 2-A-1
Certificates for
the
Interest Accrual Period for the first Distribution Date is 5.77%
per
annum.
(13) The Class 2-A-2 Certificates will be a Class of Notional
Amount
Certificates, will have no Class Certificate Balance and will bear
interest
on
its Notional Amount.
(14) The Class 2-A-2 Certificates will bear interest during each
Interest
Accrual Period at a per annum rate of 6.55% minus LIBOR, subject to
a
maximum and minimum Pass-Through Rate of 6.55% and 0.00% per
annum,
respectively. The Pass-Through Rate for the Class 2-A-2
Certificates for
the
Interest Accrual Period for the first Distribution Date is 1.23%
per
annum.
(15) The Class 2-A-3 Certificates are a Class of Principal Only
Certificates and
will
not receive any distributions of interest.
(16) The Class 2-A-4 Certificates will bear interest during each
Interest
Accrual Period at a per annum rate of LIBOR plus 0.45%, subject to
a
maximum and minimum Pass-Through Rate of 7.00% and 0.45% per
annum,
respectively. The Pass-Through Rate for the Class 2-A-4
Certificates for
the
Interest Accrual Period for the first Distribution Date is 5.77%
per
annum.
(17) The Class 2-A-5 Certificates will bear interest during each
Interest
Accrual Period at a per annum rate of LIBOR plus 0.45%, subject to
a
maximum and minimum Pass-Through Rate of 7.00% and 0.45% per
annum,
respectively. The Pass-Through Rate for the Class 2-A-5
Certificates for
the
Interest Accrual Period for the first Distribution Date is 5.77%
per
annum.
(18) The Class 1-X Certificates will be a Class of Notional Amount
Certificates,
will
have no Class Certificate Balance and will bear interest on its
Notional Amount.
(19) The Pass-Through Rate for the Class 1-X Certificates for the
Interest
Accrual Period for any Distribution Date will be equal to the
excess of (a)
the
weighted average of the Adjusted Net Mortgage Rates of the
Non-Discount
Mortgage Loans in Loan Group 1, weighted on the basis of the
Stated
Principal Balance thereof as of the Due Date in the preceding
calendar
month (after giving effect to Principal Prepayments received in
the
Prepayment Period related to such prior Due Date), over (b) 6.00%.
The
Pass-Through Rate for the Class 1-X Certificates for the Interest
Accrual
Period for the first Distribution Date is 0.331345% per annum.
(20) The Class 2-X Certificates will be a Class of Notional Amount
Certificates,
will
have no Class Certificate Balance and will bear interest on its
Notional Amount.
(21) The Pass-Through Rate for the Class 2-X Certificates for the
Interest
Accrual Period for any Distribution Date will be equal to the
excess of (a)
the
weighted average of the Adjusted Net Mortgage Rates of the
Non-Discount
Mortgage Loans in Loan Group 2, weighted on the basis of the
Stated
Principal Balance thereof as of the Due Date in the preceding
calendar
month (after giving effect to Principal Prepayments received in
the
Prepayment Period related to such prior Due Date), over (b) 6.75%.
The
Pass-Through Rate for the Class 2-X Certificates for the Interest
Accrual
Period for the first Distribution Date is 0.963433% per annum.
(22) The Class PO Certificates are a Class of Principal Only
Certificates and
will
not receive any distributions of interest.
4
<PAGE>
(23) The Class A-R Certificates represent the sole Class of
residual interest in
the
Master REMIC.
(24) The Class A-R Certificate shall be issued as two separate
certificates, one
with
an initial Certificate Balance of $99.99 and the Tax Matters
Person
Certificate with an initial Certificate Balance of $0.01.
(25) The Pass-Through Rate for each Class of Subordinated
Certificates for the
Interest Accrual Period for any Distribution Date will be a per
annum rate
equal to the Subordinate Pass-Through Rate. The Pass-Through Rate
for each
Class of Subordinated Certificates for the initial Interest Accrual
Period
is
6.176941% per annum.
5
<PAGE>
The
following table specifies the class designation, interest rate,
and
principal amount for each class of Lower Tier REMIC Interests:
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------
Lower Tier
Initial
Corresponding
REMIC Interest
Designation
Principal Balance
Interest Rate
Loan Group
--------------------------
-----------------
-------------
----------
------------------------------- ----------------------------
---------------------------- ----------------------------
<S>
<C>
<C>
<C>
LTR-A-1
(1)
6.00%
1
------------------------------- ----------------------------
---------------------------- ----------------------------
LTR-B-1
(1)
6.00%
1
------------------------------- ----------------------------
---------------------------- ----------------------------
LTR-C-1
(1)
6.00%
1
------------------------------- ----------------------------
---------------------------- ----------------------------
LTR-PO-1
$2,763,767
(2)
1
------------------------------- ----------------------------
---------------------------- ----------------------------
LTR-X-1
(3)
(4)
1
------------------------------- ----------------------------
---------------------------- ----------------------------
LTR-A-2
(1)
6.75%
2
------------------------------- ----------------------------
---------------------------- ----------------------------
LTR-B-2
(1)
6.75%
2
------------------------------- ----------------------------
---------------------------- ----------------------------
LTR-C-2
(1)
6.75%
2
------------------------------- ----------------------------
---------------------------- ----------------------------
LTR-PO-2
$79,865
(2)
2
------------------------------- ----------------------------
---------------------------- ----------------------------
LTR-X-2
(3)
(5)
2
------------------------------- ----------------------------
---------------------------- ----------------------------
LTR-A-R
(6)
(6)
N/A
----------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Each Class A Lower
Tier REMIC Interest will have an Initial Principal
Balance equal to 0.90% of the Subordinated Portion of its
Corresponding
Loan
Group. Each Class B Lower Tier REMIC Interest will have an
Initial
Principal Balance equal to 0.10% of the Subordinated Portion of
its
Corresponding Loan Group. Each Class C Lower Tier REMIC Interest
will have
an
Initial Principal Balance equal to the excess of its Corresponding
Loan
Group (as reduced by the Loan Group's corresponding PO Component
Balance)
over
the initial aggregate principal balances of the Class A and Class
B
Lower Tier REMIC Interests corresponding to that Loan Group.
Hereafter, the
Class A, Class B and Class C Lower Tier REMIC Interests are
referred to as
"Tracking Interests."
(2) This Class of
Lower Tier REMIC Interest does not pay any interest.
(3) This Class of
Lower Tier REMIC Interest does not pay any principal.
(4) This Class of
Lower Tier REMIC Interest is entitled to receive on each
Distribution Date a specified portion of the interest payable on
the
Non-Discount Mortgage Loans in the corresponding Loan Group.
Specifically,
for
each related Distribution Date, this Class of Lower Tier REMIC
Interest
is
entitled to interest accruals on each Non-Discount Mortgage Loan
in
excess of an Adjusted
Net Mortgage Rate of 6.00% per annum.
(5) This Class of
Lower Tier REMIC Interest is entitled to receive on each
Distribution Date a specified portion of the interest payable on
the
Non-Discount Mortgage Loans in the corresponding Loan Group.
Specifically,
for
each related Distribution Date, this Class of Lower Tier REMIC
Interest
is
entitled to interest accruals on each Non-Discount Mortgage Loan
in
excess of an Adjusted Net Mortgage Rate of 6.75% per annum.
(6) The Class LTR-A-R
Lower Tier REMIC Interest is the sole class of residual
interest in the Lower Tier REMIC. It does not pay any interest
or
principal.
On
each Distribution Date, the Available Funds shall be distributed
with
respect to the the Lower Tier REMIC Interests in the following
manner:
(1) Interest. Interest
is to be distributed with respect to each Lower Tier
REMIC Interest at the rates, or according to the formulas,
described above.
6
<PAGE>
(2) Initial
Allocations of Realized Losses and Principal.
(a) The Trustee shall
first allocate the Realized Losses on the Group
1 Mortgage Loans (including any reductions in previously
allocated Realized Losses on the Group 1 Mortgage Loans
attributable to any related Subsequent Recoveries), and
distribute the principal on the Group 1 Mortgage Loans between
the LTR-PO-1 Interests and the LTR-1 Tracking Interests in the
same manner that such amounts are allocated to or distributed
between (a) the Class PO-1 Component of the Class PO
Certificates
and (b) the remaining Group 1 Certificates and the Assumed
Balance of the Class Certificate Balance of each Class of
Subordinated Certificates related to the Group 1 Mortgage
Loans.
(b) The Trustee shall
first allocate the Realized Losses on the Group
2 Mortgage Loans (including any reductions in previously
allocated Realized Losses on the Group 2 Mortgage Loans
attributable to any related Subsequent Recoveries), and
distribute the principal on the Group 2 Mortgage Loans between
the Class LTR-PO-2 Interest and the LTR-2 Tracking Interests in
the same manner that such amounts are allocated to or
distributed
between (a) the Class PO-2 Component of the Class PO
Certificates
and (b) the remaining Group 2 Senior Certificates and the
Assumed
Balance of the Class Certificate Balance of each Class of
Subordinated Certificates related to the Group 2 Mortgage
Loans.
(3) Subsequent
Allocations. Amounts allocated to the Tracking Interests of
each
Group in accordance with Paragraph 2, above, shall be further
allocated as
described below.
(4) Principal, if no
Cross-Over Situation Exists. If no Cross-Over Situation
exists with respect to any Class of Tracking Interests, Principal
Amounts
allocated with respect to each Loan Group's Tracking Interests
in
accordance with Paragraph 2, shall be further allocated: first to
cause the
Loan
Group's corresponding Class A and Class B Tracking Interests to
equal,
respectively, 0.90% of the Subordinated Portion and 0.10% of
the
Subordinated Portion; and second to the Loan Group's corresponding
Class C
Tracking Interest;
(5) Principal, if a
Cross-Over Situation Exists. If a Cross-Over Situation
exists with respect to the Class A and Class B Tracking
Interests:
(a) If the Calculation
Rate in respect of the outstanding Class A and
Class B Tracking Interests is less than the Subordinate
Pass-Through Rate, Principal Relocation Payments will be made
proportionately to the outstanding Class A Tracking Interests
prior to any other principal distributions from each such Loan
Group.
(b) If the Calculation
Rate in respect of the outstanding Class A and
Class B Tracking Interests is greater than the Subordinate
Pass-Through Rate, Principal Relocation Payments will be made
proportionately to the outstanding Class B Tracking Interests
prior to any other principal distributions from each such Loan
Group.
In
each case, Principal Relocation Payments will be made so as to
cause the
Calculation Rate in respect of the outstanding Class A and Class B
Tracking
Interests to equal the Subordinate Pass-Through Rate. With respect
to each Loan
Group, if (and to the extent that) the sum of (a) the principal
payments
received during the Due Period (as adjusted for amounts allocated
to the related
Class PO Component) and (b) the Realized Losses (as adjusted for
amounts
allocated to the related Class PO Component), are
7
<PAGE>
insufficient to make the necessary reductions of principal on the
Class A and
Class B Tracking Interests, then interest will be added to the Loan
Group's
Class C Tracking Interest.
(c) Unless required to
achieve the Calculation Rate, the outstanding
aggregate Class A and Class B Tracking Interests for all Loan
Groups will not be reduced below 1 percent of the excess of (i)
the aggregate outstanding Principal Balances of all Loan Groups
(as adjusted for amounts allocated to the related Class PO
Component) as of the end of any Due Period (reduced by
principal
prepayments received after the Due Period that are to to be
distributed on the Disribution Date related to the Due Period)
over (ii) the aggregate Class Certificate Balance of the Senior
Certificates for all Loan Groups as of the related Distribution
Date (after taking into account distributions of principal on
such Distribution Date).
If
(and to the extent that) the limitation in paragraph (c) prevents
the
distribution of principal to the Class A and Class B Tracking
Interests of a
Loan Group, and if the Loan Group's Class C Tracking Interest has
already been
reduced to zero, then the excess principal from that Loan Group (as
adjusted for
amounts allocated to the related Class PO Component) will be paid
to the Class C
Tracking Interests of the other Loan Groups the aggregate Class A
and Class B
Tracking Interests of which are less than one percent of the
Subordinated
Portion. If the Loan Group corresponding to the Class C Tracking
Interest that
receives such payment has a weighted average Adjusted Net Mortgage
Rate below
the weighted average Adjusted Net Mortgage Rate of the Loan Group
making the
payment, then the payment will be treated by the Lower Tier REMIC
as a Realized
Loss. Conversely, if the Loan Group corresponding to the Class C
Tracking
Interest that receives such payment has a weighted average Adjusted
Net Mortgage
Rate above the weighted average Adjusted Net Mortgage Rate of the
Loan Group
making the payment, then the payment will be treated by the Lower
Tier REMIC as
a reimbursement for prior Realized Losses.
8
<PAGE>
The
following table specifies the class designation, interest rate,
and
principal amount for each class of Middle Tier REMIC Interests:
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------
Middle Tier REMIC
Interest
Initial Principal Balance
Interest Rate
Corresponding Master REMIC
Certificate
------------------------------- --------------------------
---------------------------- ----------------------------
<S>
<C>
<C>
<C>
MTR-1-A-1
$40,000,000
6.00%
1-A-1
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-1-A-2
$3,810,000
6.00%
1-A-2
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-1-A-3
$635,000
6.00%
1-A-3
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-1-A-4
$13,502,000
6.00%
1-A-4
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-1-A-5
$2,339,000
6.00%
1-A-5
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-1-A-6
$60,000,000
6.00%
1-A-6 , 1-A-7(1)
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-1-A-8
$60,000,000
6.00%
1-A-8
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-1-A-9
$20,000,000
6.00%
1-A-9
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-1-A-10
$9,735,000
6.00%
1-A-10
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-1-A-11
$78,000,000
6.00%
1-A-11, 1-A-12(2)
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-1-A-13
$100,000,000
6.00%
1-A-13
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-1-A-14
$100,000,000
6.00%
1-A-14
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-1-A-15
$247,000
6.00%
1-A-15
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-1-A-16
$7,330,286
6.00%
1-A-16
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-1-A-17
$1,221,714
6.00%
1-A-17
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-1-A-18
$37,094,000
6.00%
1-A-18
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-1-A-19
$139,510,000
6.00%
1-A-19
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-1-A-20
$28,876,000
6.00%
1-A-20
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-1-X
(3)
(4)
1-X
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-2-A-1
$106,071,428
7.00%
2-A-1, 2-A-2(5)
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-2-A-3
$6,520,622
(6)
2-A-3
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-2-A-4
$66,431,250
7.00%
2-A-4, 2-A-2(5)
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-2-A-5
$3,554,100
7.00%
2-A-5, 2-A-2(5)
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-2-X
(3)
(7)
2-X
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-1-$100
$100
6.00%
A-R
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-PO
(8)
(6)
PO
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-M-1
$15,542,000
(9)
M-1
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-M-2
$4,090,000
(9)
M-2
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-M-3
$6,135,000
(9)
M-3
------------------------------- --------------------------
---------------------------- ----------------------------
9
<PAGE>
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-M-4
$2,045,000
(9)
M-4
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-M-5
$2,044,000
(9)
M-5
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-M-6
$2,454,000
(9)
M-6
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-M-7
$1,227,000
(9)
M-7
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-B-1
$1,227,000
(9)
B-1
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-B-2
$1,227,000
(9)
B-2
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-B-3
$2,045,000
(9)
B-3
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-B-4
$3,272,000
(9)
B-4
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-B-5
$2,454,672
(9)
B-5
------------------------------- --------------------------
---------------------------- ----------------------------
MTR-A-R
(10)
(10)
N/A
--------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) For each
Distribution Date, the Class 1-A-7 Certificates are entitled to
a
specified portion of the interest payable on each of the Class
MTR-1-A-6
Middle Tier REMIC Interest. Specifically, for each Distribution
Date, the
Class 1-A-7 Certificates are entitled to interest payable on the
Class
MTR-1-A-6 Middle Tier REMIC Interest at a per annum rate equal to
5.40%
minus LIBOR, but not less than 0.00%.
(2) For each
Distribution Date, the Class 1-A-12 Certificates are entitled to
a
specified portion of the interest payable on each of the Class
MTR-1-A-11
Middle Tier REMIC Interest. Specifically, for each Distribution
Date, the
Class 1-A-12 Certificates are entitled to interest payable on the
Class
MTR-1-A-11 Middle Tier REMIC Interest at a per annum rate equal to
5.35%
minus LIBOR, but not less than 0.00%.
(3) This Class of
Middle Tier REMIC Interest pays no principal.
(4) For each
Distribution Date, the Class MTR-1-X Middle Tier REMIC Interest
is
entitled to all the interest payable with respect to the Class
LTR-X-1
Lower Tier REMIC Interest.
(5) For each
Distribution Date, the Class 2-A-2 Certificates are entitled to
a
specified portion of the interest payable on each of the Class
MTR-2-A-1
Middle Tier REMIC Interest, the Class MTR-2-A-4 Middle Tier REMIC
Interest
and
the Class MTR-2-A-5 Middle Tier REMIC Interest. Specifically, for
each
Distribution Date, the Class 2-A-2 Certificates are entitled to
interest
payable on each of the Class MTR-2-A-1 Middle Tier REMIC Interest,
the
Class MTR-2-A-4 Middle Tier REMIC Interest and the Class MTR-2-A-5
Middle
Tier
REMIC Interest at a per annum rate equal to 6.55% minus LIBOR, but
not
less
than 0.00%.
(6) This Class of
Middle Tier REMIC Interest pays no interest.
(7) For each
Distribution Date, the Class MTR-2-X Middle Tier REMIC Interest
is
entitled to all the interest payable with respect to the Class
LTR-X-2
Lower Tier REMIC Interest.
(8) For each
Distribution Date, the Class MTR-PO Middle Tier REMIC Interest
is
entitled to all the principal payable with respect to the Class
LTR-PO-1
Lower Tier REMIC Interest and the Class LTR-PO-2 Lower Tier REMIC
Interest.
(9) The Subordinate
Pass-Through Rate.
(10) The MT-A-R is the sole class of residual interest in the
Middle Tier REMIC.
It
pays no interest or principal.
10
<PAGE>
On
each Distribution Date, interest shall be payable on the Middle
Tier
REMIC Interests according the formulas described above, and
principal, Realized
Losses and Subsequent Recoveries shall be allocated among the
Middle Tier REMIC
Interests in the same manner that such items are allocated among
their
corresponding Certificate Classes.
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
a REMIC
regular interest, without creating any shortfall-actual or
potential (other than
for credit losses) to any REMIC regular interest.
11
<PAGE>
Set
forth below are designations of Classes or Components of
Certificates
and other defined terms to the categories used herein:
Accretion Directed Certificates.... Class 1-A-9, Class 1-A-10, Class
1-A-14,
Class 1-A-15 and Class 1-A-16 Certificates.
Accretion Directed Components...... None.
Accrual Certificates............... Class 1-A-13 Certificates.
Accrual Components................. None.
Book-Entry Certificates............ All Classes of Certificates other
than the
Physical Certificates.
COFI Certificates.................. None.
Combined Certificates.............. None.
Component Certificates............. Class PO Certificates.
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 Pass-
Component
Through
Designation
Balance
Rate
-----------
-------
----
Class PO-1 Component $2,763,767 (1)
Class PO-2 Component $79.865
(1)
(1) This component
does not bear interest.
Delay Certificates................. All interest-bearing Classes
of
Certificates other than the Non-Delay
Certificates, if any.
ERISA-Restricted Certificates...... The Residual Certificates and
Private
Certificates; until an ERISA-Qualifying
Underwriting has occurred with respect to
such Class, the Class PO, the Class 1-X and
the Class 2-X 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.
Floating Rate Certificates......... Class 1-A-2, Class 1-A-6, Class
1-A-11,
Class 1-A-14, Class 2-A-1, Class 2-A-4 and
Class 2-A-5 Certificates.
Group 1 Certificates............... Group 1 Senior Certificates and
the
portions
of the Subordinated Certificates
related to Loan Group 1.
Group 1 Senior Certificates........ Class 1-A-1, Class 1-A-2, Class
1-A-3,
Class 1-A-4, Class 1-A-5, Class 1-A-6,
Class 1-A-7, Class 1-A-8, Class 1-A-9,
Class 1-A-10, Class 1-A-11, Class 1-A-12,
Class 1-A-13, Class 1-A-14, Class 1-A-15,
Class 1-A-16, Class 1-A-17, Class 1-A-18,
Class
12
<PAGE>
1-A-19, Class 1-A-20, Class 1-X and
Class A-R Certificates and Class PO-1
Component.
Group 2 Certificates............... Group 2 Senior Certificates and
the
portions of the Subordinated Certificates
related to Loan Group 2.
Group 2 Senior Certificates........ Class 2-A-1, Class 2-A-2, Class
2-A-3,
Class 2-A-4, Class 2-A-5 and Class
2-X Certificates and Class PO-2
Component.
Inverse Floating Rate Certificates. Class 1-A-3, Class 1-A-7, Class
1-A-12,
Class 1-A-15, Class 2-A-2 Certificates.
LIBOR Certificates................. The Floating Rate Certificates and
the
Inverse Floating Rate Certificates.
Non-Delay Certificates............. LIBOR Certificates.
Notional Amount Certificates....... Class 1-A-7, Class 1-A-12, Class
2-A-2,
Class 1-X and Class 2-X Certificates.
Notional Amount Components......... None.
Offered Certificates............... All Classes of Certificates other
than the
Private Certificates.
Physical Certificates.............. Private Certificates and the
Residual
Certificates.
Planned Principal Classes.......... None.
Principal Only Certificates........ Class 2-A-3 and Class PO
Certificates.
Private Certificates............... Class B-2, Class B-3, Class B-4
and
Class B-5 Certificates.
Rating Agencies.................... Fitch, S&P and Moody's.
Regular Certificates............... All Classes of Certificates, other
than the
Residual Certificates.
Residual Certificates.............. Class A-R Certificates.
Scheduled Principal Classes........ None.
Senior Certificate Group........... The Group 1 Senior Certificates
and the
Group 2 Senior Certificates, as applicable.
Senior Certificates................ The Group 1 Senior Certificates
and
Group 2 Senior Certificates.
Subordinated Certificates.......... Class M-1, Class M-2, Class M-3,
Class M-4,
Class M-5, Class M-6, Class M-7 Class B-1,
Class B-2, Class B-3, Class B-4 and
Class B-5 Certificates.
Targeted Principal Classes......... None.
13
<PAGE>
Underwriter........................ Each of Deutsche Bank Securities
Inc.
(Senior) and Banc of America Securities
LLC.
With respect to any of the foregoing designations as to which
the
corresponding reference is "None," all defined terms and provisions
herein
relating solely to such designations shall be of no force or
effect, and any
calculations herein incorporating references to such designations
shall be
interpreted without reference to such designations and amounts.
Defined terms
and provisions herein relating to statistical rating agencies not
designated
above as Rating Agencies shall be of no force or effect.
If the aggregate Stated Principal Balance of the Initial
Mortgage
Loans in Loan Group 1 and Loan Group 2 on the Closing Date is equal
to or
greater than the aggregate Class Certificate Balance of the Group 1
Certificates
and Group 2 Certificates, as of such date, all references herein to
"Aggregate
Supplemental Purchase Amount", "Aggregate Supplemental Transfer
Amount",
"Capitalized Interest Account", "Capitalized Interest Requirement",
"Funding
Period", "Funding Period Distribution Date", "Remaining Pre-funded
Amount",
"Remaining Non-PO Pre-funded Amount", "Remaining PO Pre-funded
Amount",
"Pre-funded Amount", "Supplemental Cut-off Date", "Pre-funding
Account",
"Supplemental Mortgage Loan", "Supplemental Transfer Agreement"
and
"Supplemental Transfer Date" with respect to each Loan Group, as
applicable,
shall be of no force or effect and all provisions herein related
thereto shall
similarly be of no force or effect.
14
<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:
Account: The Escrow Account, the Certificate Account, the
Distribution Account, the Corridor Contract Reserve Fund, the
Pre-funding
Account, the Capitalized Interest Account or any other account
related to the
Trust Fund or the Mortgage Loans.
Accretion Directed Certificates: As specified in the
Preliminary
Statement.
Accretion Direction Rule: On each Distribution Date up to and
including the Accrual Termination Date, the Accrual Amount for the
Class 1-A-13
Certificates will be distributed as principal in the following
order:
1. in an amount
up to $68,000 on each Distribution Date, to the Class 1-A-9
Certificates, until its Class Certificate Balance is reduced to
zero;
2. in an amount
up to 1% of the Accrual Amount available pursuant to this
rule, in the following order:
(a)
in an amount up to
$973,000 on each Distribution Date, to the Class
1-A-10 Certificates, until its Class Certificate Balance is reduced
to
zero;
(b)
concurrently, to the
Class 1-A-14 and Class 1-A-15 Certificates, pro
rata, until their respective Class Certificate Balances are reduced
to
zero; and
(c)
to the Class 1-A-10
Certificates, until its Class Certificate Balance
is reduced to zero;
3. in an amount
up to $445,130 on each Distribution Date, to the Class 1-A-16
Certificates, until its Class Certificate Balance is reduced to
zero;
4. in an
aggregate amount up to $973,000 (including any amounts paid
pursuant
to
Rule 2(a) above) on each Distribution Date, to the Class 1-A-10
Certificates, until its Class Certificate Balance is reduced to
zero;
5. concurrently,
to the Class 1-A-14 and Class 1-A-15 Certificates, pro rata,
until their respective Class Certificate Balances are reduced to
zero; and
6. sequentially,
to the Class 1-A-10, Class 1-A-16, Class 1-A-9 and Class
1-A-13 Certificates, in that order, until their respective
Class
Certificate Balances are reduced to zero.
Accrual Amount: With respect to any Class of Accrual Certificates
or
any Accrual Component and any Distribution Date prior to the
related Accrual
Termination Date, the amount allocable to interest on such Class of
Accrual
Certificates or Accrual Component with respect to such Distribution
Date
pursuant to Section 4.02(a).
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Accrual Certificates: As specified in the Preliminary
Statement.
Accrual Components: As specified in the Preliminary Statement.
Accrual Termination Date: The earlier of the Senior Credit
Support
Depletion Date and the Distribution Date on which the aggregate
Class
Certificate Balance of the Class 1-A-9, Class 1-A-10, Class 1-A-14,
Class 1-A-15
and Class 1-A-16 Certificates is reduced to zero.
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 sum of
the Trustee
Fee Rate and the Master Servicing Fee Rate. For purposes of
determining whether
any Substitute Mortgage Loan is a Discount Mortgage Loan or a
Non-Discount
Mortgage Loan and for purposes of calculating the applicable PO
Percentage and
the applicable Non-PO Percentage, each Substitute Mortgage Loan
shall be deemed
to have an Adjusted Net Mortgage Rate equal to the Adjusted Net
Mortgage Rate of
the Deleted Mortgage Loan for which it is substituted.
Advance: As to a Loan Group, the payment required to be made by
the
Master Servicer with respect to any Distribution Date pursuant to
Section 4.01,
the amount of any such payment being equal to the aggregate of
payments of
principal and interest (net of the Master Servicing Fee) on the
Mortgage Loans
in such Loan Group that were due on the related Due Date and not
received by the
Master Servicer as of the close of business on the related
Determination Date,
together with an amount equivalent to interest on each Mortgage
Loan as to which
the related Mortgaged Property is an REO Property (net of any net
income from
such REO Property), less the aggregate amount of any such
delinquent payments
that the Master Servicer has determined would constitute a
Nonrecoverable
Advance, if advanced.
Aggregate Planned Balance: With respect to any group of Planned
Principal Classes or Components and any Distribution Date, the
amount set forth
for such group for such Distribution Date in Schedule V hereto.
Aggregate Scheduled Balance: With respect to any group of
Scheduled
Principal Classes or Components and any Distribution Date, the
amount set forth
for such group for such Distribution Date in Schedule V hereto.
Aggregate Supplemental Purchase Amount: With respect to any
Supplemental Transfer Date and Loan Group 1, the applicable
"Aggregate
Supplemental Purchase Amount" identified in the related
Supplemental Transfer
Agreement for such Loan Group, which shall be an estimate of the
aggregate
Stated Principal Balances of the Supplemental Mortgage Loans to be
included in
such Loan Group identified in such Supplemental Transfer
Agreement.
Aggregate Supplemental Transfer Amount: With respect to any
Supplemental Transfer Date and Loan Group 1, the aggregate Stated
Principal
Balance as of the related Supplemental Cut-off Date of the
Supplemental Mortgage
Loans to be included in such Loan Group conveyed on such
Supplemental Transfer
Date, as listed on the revised Mortgage Loan Schedule delivered
pursuant to
Section 2.01(f); provided, however, that such amount shall not
exceed the amount
on deposit in the Pre-funding Account allocated to purchasing
Supplemental
Mortgage Loans for such Loan Group.
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Aggregate Targeted Balance: With respect to any group of
Targeted
Principal Classes or Components and any Distribution Date, the
amount set forth
for such group for such Distribution Date in Schedule V hereto.
Agreement: This Pooling and Servicing Agreement and all
amendments
or supplements hereto.
Allocable Share: As to any Distribution Date and any Mortgage
Loan
(i) with respect to each Class PO Component, zero, (ii) with
respect to the
Class 1-X and Class 2-X Certificates, (a) the ratio that the
excess, if any, of
the Adjusted Net Mortgage Rate with respect to such Mortgage Loan,
over the
related Required Coupon bears to such Adjusted Net Mortgage Rate or
(b) if the
Adjusted Net Mortgage Rate with respect to such Mortgage Loan does
not exceed
the related Required Coupon, zero and (iii) with respect to each
other Class of
Certificates the product of (a) the lesser of (I) the ratio that
the related
Required Coupon bears to the Adjusted Net Mortgage Rate of such
Mortgage Loan
and (II) one, multiplied by (b) the ratio that the amount
calculated with
respect to such Distribution Date (A) with respect to the Senior
Certificates of
the related Senior Certificate Group (other than the related Class
PO
Component), pursuant to clause (i) of the definition of Class
Optimal Interest
Distribution Amount (without giving effect to any reduction of such
amount
pursuant to Section 4.02(d)) and (B) with respect to the
Subordinated
Certificates, pursuant to the definition of Assumed Interest Amount
or after a
Senior Termination Date pursuant to clause (i) of the definition of
Class
Optimal Interest Distribution Amount (without giving effect to any
reduction of
such amount pursuant to Section 4.02(d)) bears to the amount
calculated with
respect to such Distribution Date for each Class of Certificates
pursuant to
clause (i) of the definition of Class Optimal Interest Distribution
Amount
(without giving effect to any reduction of such amount pursuant to
Section
4.02(d)) or the definition of Assumed Interest Amount, as
applicable.
Amount Available for Senior Principal: As to any Distribution
Date
and (a) Loan Group 1, the Available Funds for such Distribution
Date and Loan
Group, reduced by the aggregate amount distributable (or allocable
to the
Accrual Amount, if applicable) on such Distribution Date in respect
of interest
on the related Senior Certificates pursuant to Section
4.02(a)(1)(ii) and (b)
Loan Group 2, the Available Funds for such Distribution Date and
Loan Group,
reduced by the aggregate amount distributable (or allocable to the
Accrual
Amount, if applicable) on such Distribution Date in respect of
interest on the
related Senior Certificates pursuant to Section 4.02(a)(2)(ii).
Amount Held for Future Distribution: As to any Distribution Date
and
Mortgage Loans in a Loan Group, the aggregate amount held in the
Certificate
Account at the close of business on the related Determination Date
on account of
(i) Principal Prepayments received after the related Prepayment
Period and
Liquidation Proceeds and Subsequent Recoveries received in the
month of such
Distribution Date relating to such Loan Group and (ii) all
Scheduled Payments
due after the related Due Date relating to such Loan Group.
Applicable Credit Support Percentage: As defined in Section
4.02(e).
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 sale 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
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<PAGE>
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 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.
Assumed Balance: For a Distribution Date and Loan Group, an
amount
equal to the Subordinated Percentage for that Distribution Date
relating to that
Loan Group of the aggregate of the applicable Non-PO Percentage of
the Stated
Principal Balance of each Mortgage Loan in such Loan Group as of
the Due Date
occurring in the month prior to the month of that Distribution Date
(after
giving effect to Principal Prepayments received in the Prepayment
Period related
to such Due Date).
Assumed Interest Amount: With respect to any Distribution Date
and
Class of Subordinated Certificates, one month's interest accrued
during the
related Interest Accrual Period at the Pass-Through Rate for such
Class on the
applicable Assumed Balance immediately prior to that Distribution
Date.
Available Funds: As to any Distribution Date and the Mortgage
Loans
in a Loan Group, the sum of (a) the aggregate amount held in the
Certificate
Account at the close of business on the related Determination Date,
including
any Subsequent Recoveries, in respect of such Mortgage Loans, net
of the related
Amount Held for Future Distribution and net of amounts permitted to
be withdrawn
from the Certificate Account pursuant to clauses (i) - (viii),
inclusive, of
Section 3.08(a) in respect of such Mortgage Loans and amounts
permitted to be
withdrawn from the Distribution Account pursuant to clauses (i) -
(v),
inclusive, of Section 3.08(b) in respect of such Mortgage Loans,
(b) the amount
of the related Advance and (c) in connection with Defective
Mortgage Loans in
such Loan Group, as applicable, the aggregate of the Purchase
Prices and
Substitution Adjustment Amounts deposited on the related
Distribution Account
Deposit Date; (d) with respect to Loan Group 1, on each Funding
Period
Distribution Date, the amount, if any, transferred from the
Capitalized Interest
Account in respect of the applicable Capitalized Interest
Requirement with
respect to such Loan Group, and (e) with respect to Loan Group 1,
on the last
Funding Period Distribution Date, the amount, if any, transferred
from the
Pre-funding Account representing the Remaining Non-PO Pre-funded
Amount and the
Remaining PO Pre-funded Amount, if any.
Bankruptcy Code: The United States Bankruptcy Reform Act of 1978,
as
amended.
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.
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.
Capitalized Interest Requirement: With respect to each Funding
Period Distribution Date and Loan Group 1, the excess, if any, of
(a) the sum of
(1) the amount calculated pursuant to clause (i) of the definition
of Class
Optimal Interest Distribution Amount for each Class of Group 1
Certificates for
such Distribution Date, plus (2) the Trustee Fee allocated to Loan
Group 1, over
(b) with respect to each
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<PAGE>
Mortgage Loan in Loan Group 1, (1) 1/12 of the product of the
related Adjusted
Mortgage Rate and the related Stated Principal Balance as of the
related Due
Date (prior to giving effect to any Scheduled Payment due on such
Mortgage Loan
on such Due Date) minus (2) any related reductions required by
Section 4.02(d)
hereof. On the Closing Date, the amount deposited in the
Capitalized Interest
Account shall be $206,450.13.
Ceiling Rate: With respect to each Class of Covered
Certificates,
the applicable percentage set forth below:
----------------------------------------------------
Class of Certificates
Ceiling Rate
---------------------------------- -----------------
Class 1-A-6
8.90%
---------------------------------- -----------------
Class 1-A-11
8.85%
----------------------------------------------------
Certificate: Any one of the Certificates executed by the Trustee
in
substantially the forms attached hereto 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 2006-39CB, Mortgage Pass-Through
Certificates,
Series 2006-39CB."
Certificate Balance: With respect to any Certificate at any
date
(other than the Notional Amount Certificates), the maximum dollar
amount of
principal to which the Holder thereof is then entitled hereunder,
such amount
being equal to the Denomination thereof (A) plus any increase in
the Certificate
Balance of each Certificate pursuant to Section 4.02 due to the
receipt of
Subsequent Recoveries, (B) minus the sum of (i) all distributions
of principal
previously made with respect thereto and (ii) all Realized Losses
allocated
thereto and, in the case of the Subordinated Certificates, all
other reductions
in Certificate Balance previously allocated thereto pursuant to
Section 4.04 and
(C) in the case of any Class of Accrual Certificates, increased by
the Accrual
Amount added to the Class Certificate Balance of such Class prior
to such date.
The Notional Amount Certificates have no Certificate Balances.
Certificate Group: The Group 1 Certificates or the Group 2
Certificates, as the context requires.
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 hereunder, it shall first have to provide evidence of
its beneficial
ownership interest in a Certificate that is reasonably satisfactory
to the
Trustee, the Depositor, and/or the Master Servicer, as
applicable.
Certificate Register: The register maintained pursuant to
Section
5.02 hereof.
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
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<PAGE>
Percentage Interests evidenced by a Class of Certificates, such
Certificates
shall be deemed to be Outstanding for purposes of any provision
hereof (other
than the second sentence of Section 10.01 hereof) that requires the
consent of
the Holders of Certificates of a particular Class as a condition to
the taking
of any action hereunder. The 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.
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 Certificate Balance: With respect to any Class and as to
any
date of determination, the aggregate of the Certificate Balances of
all
Certificates of such Class as of such date.
Class Interest Shortfall: As to any Distribution Date and Class,
the
amount by which the amount described in clause (i) of the
definition of Class
Optimal Interest Distribution Amount for such Class exceeds the
amount of
interest actually distributed on such Class on such Distribution
Date pursuant
to such clause (i).
Class Optimal Interest Distribution Amount: With respect to any
Distribution Date and interest bearing Class or, with respect to
any
interest-bearing Component, the sum of (i) one month's interest
accrued during
the related Interest Accrual Period at the Pass-Through Rate for
such Class on
the related Class Certificate Balance, Component Balance, Notional
Amount or
Component Notional Amount, as applicable, immediately prior to such
Distribution
Date, subject to reduction as provided in Section 4.02(d) and (ii)
any Class
Unpaid Interest Amounts for such Class or Component.
Class PO Component: The Class PO-1 or Class PO-2 Component, as
applicable.
Class PO Deferred Amount: As to any Distribution Date and Loan
Group, the aggregate of the applicable PO Percentage of each
Realized Loss on a
Discount Mortgage Loan in that Loan Group to be allocated to the
related Class
PO Component on such Distribution Date on or prior to the related
Senior Credit
Support Depletion Date or previously allocated to such Class PO
Component and
not yet paid to the Holders of the Class PO Certificates.
Class Subordination Percentage: With respect to any
Distribution
Date and each Class of Subordinated Certificate, the quotient
(expressed as a
percentage) of (a) the Class Certificate Balance of such Class of
Subordinated
Certificates immediately prior to such Distribution Date divided by
(b) the
aggregate of the Class Certificate Balances immediately prior to
such
Distribution Date of all Classes of Certificates.
Class Unpaid Interest Amounts: As to any Distribution Date and
Class
of interest bearing Certificates, the amount by which the aggregate
Class
Interest Shortfalls for such Class on prior Distribution Dates
exceeds the
amount distributed on such Class on prior Distribution Dates
pursuant to clause
(ii) of the definition of Class Optimal Interest Distribution
Amount.
Closing Date: November 30, 2006.
I-6
<PAGE>
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.
Combined Certificates: As specified in the Preliminary
Statement.
Combined Certificates Payment Rule: Not applicable.
Compensating Interest: As to any Distribution Date and Loan Group
an
amount equal to the product of one-twelfth of 0.125% and the
aggregate Stated
Principal Balance of the Mortgage Loans in such Loan Group as of
the Due Date in
the prior calendar month.
Component: As specified in the Preliminary Statement.
Component Balance: With respect to any Component and any
Distribution Date, the Initial Component Balance thereof on the
Closing Date,
(A) plus any increase in the Component Balance of such Component
pursuant to
Section 4.02 due to the receipt of Subsequent Recoveries, (B) minus
the sum of
all amounts applied in reduction of the principal balance of such
Component and
Realized Losses allocated thereto on previous Distribution
Dates.
Component Certificates: As specified in the Preliminary
Statement.
Component Notional Amount: Not applicable.
Confirmation: With respect to the Class 1-A-11 Certificates,
the
confirmation (reference 1126060), dated November 30, 2006,
evidencing a
transaction between the Supplemental Interest Trustee and Swiss Re
Financial
Products Corporation, a form of which is attached hereto as Exhibit
R.
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,
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<PAGE>
4W, New York, New York 10286 (Attn: Mortgage-Backed Securities
Group, CWALT,
Inc. Series 2006-39CB), facsimile no. (212) 815-3986, and which is
the address
to which notices to and correspondence with the Trustee should be
directed.
Corridor Contract: With respect to each Class of Covered
Certificates, the transaction evidenced by the Confirmation or the
Novation
Confirmation, as applicable.
Corridor Contract Counterparty: Bear Stearns Financial Products
Inc.
or Swiss Re Financial Products Corporation, as applicable.
Corridor Contract Reserve Fund: The separate fund created and
initially maintained by the Supplemental Interest Trustee pursuant
to Section
3.05(i) in the name of the Supplemental Interest Trustee for the
benefit of the
Holders of the Covered Certificates and designated "The Bank of New
York in
trust for registered holders of CWALT, Inc., Alternative Loan Trust
2006-39CB,
Mortgage Pass-Through Certificates, Series 2006-39CB." Funds in the
Corridor
Contract Reserve Fund shall be held in trust for the Holders of the
Covered
Certificates for the uses and purposes set forth in this Agreement.
For all
federal income tax purposes, the Corridor Contract Reserve Fund
will be
beneficially owned by the Deutsche Bank Securities Inc.
Corridor Contract Scheduled Termination Date: With respect to
the
Class 1-A-6 Certificates, the Distribution Date in March 2018. With
respect to
the Class 1-A-11 Certificates the Distribution Date in March
2018.
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.
Covered Certificates: The Class 1-A-6 and Class 1-A-11
Certificates.
Cross-Over Situation: For any Distribution Date and for each
Loan
Group (after taking into account principal distributions on such
Distribution
Date) with respect to the Class A and Class B Lower Tier REMIC
Interests, a
situation in which the Class A and Class B Interests corresponding
to any Loan
Group are in the aggregate less than 1% of the Subordinated Portion
of the Loan
Group to which they correspond.
Cut-off Date: In the case of any Initial Mortgage Loan, the
Initial
Cut-off Date, and in the case of any Supplemental Mortgage Loan,
the related
Supplemental Cut-off Date.
Cut-off Date Pool Principal Balance: An amount equal to the sum
of
(x) the Initial Cut-off Date Pool Principal Balance plus (y) with
respect to
Loan Group 1, the amount, if any, deposited in the Pre-funding
Account on the
Closing Date.
Cut-off Date Principal Balance: As to any Mortgage Loan, the
Stated
Principal Balance thereof as of the close of business on the
Cut-off Date.
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
which became
final and non-appealable, except such a reduction resulting from a
Deficient
Valuation or any reduction that results in a permanent forgiveness
of principal.
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<PAGE>
Defective Mortgage Loan: Any Mortgage Loan which is required to
be
repurchased pursuant to Section 2.02 or 2.03.
Deficient Valuation: With respect to any Mortgage Loan, a
valuation
by a court of competent jurisdiction of the Mortgaged Property in
an amount less
than the then-outstanding indebtedness under the Mortgage Loan, or
any reduction
in the amount of principal to be paid in connection with any
Scheduled Payment
that results in a permanent forgiveness of principal, which
valuation or
reduction results from an order of such court which is final and
non-appealable
in a proceeding under the Bankruptcy Code.
Definitive Certificates: Any Certificate evidenced by a
Physical
Certificate and any Certificate issued in lieu of a Book-Entry
Certificate
pursuant to Section 5.02(e).
Delay Certificates: As specified in the Preliminary Statement.
Delay Delivery Certification: As defined in Section 2.02(a)
hereof.
Delay Delivery Mortgage Loans: The Mortgage Loans for which all or
a
portion of a related Mortgage File is not delivered to the Trustee
on the
Closing Date or Supplemental Transfer Date. The number of Delay
Delivery
Mortgage Loans shall not exceed 50% of the aggregate number of
Initial Mortgage
Loans in each Loan Group as of the Closing Date and 90% of the
Supplemental
Mortgage Loans in Loan Group 1 conveyed on the related Supplemental
Transfer
Date. To the extent that Countrywide Home Loans Servicing LP 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 Home Loans Servicing LP 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) hereof.
Denomination: With respect to each Certificate, the amount set
forth
on the face thereof 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 which
is two
Business Days preceding such Distribution Date.
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<PAGE>
Discount Mortgage Loan: Any Mortgage Loan in a Loan Group with
an
Adjusted Net Mortgage Rate that is less than the Required Coupon
for that Loan
Group.
Distribution Account: The separate Eligible Account created and
maintained by the Trustee pursuant to Section 3.05 in the name of
the Trustee
for the benefit of the Certificateholders and designated "The Bank
of New York
in trust for registered holders of Alternative Loan Trust
2006-39CB, Mortgage
Pass-Through Certificates, Series 2006-39CB." Funds in the
Distribution Account
shall be held in trust for the Certificateholders for the uses and
purposes set
forth in this Agreement.
Distribution Account Deposit Date: As to any Distribution Date,
12:30 p.m. Pacific time on the Business Day immediately preceding
such
Distribution Date.
Distribution Date: The 25th day of each calendar month after
the
initial issuance of the Certificates, or if such 25th day is not a
Business Day,
the next succeeding Business Day, commencing in December 2006.
Due Date: With respect to any Distribution Date, the related
Due
Date is the first day of the month in which that Distribution Date
occurs.
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 or Fitch 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 Repurchase Month: As defined in Section 3.11 hereof.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA-Qualifying Underwriting: A best efforts or firm
commitment
underwriting or private placement that meets the requirements of
the
Underwriter's Exemption.
ERISA-Restricted Certificate: As specified in the Preliminary
Statement.
Escrow Account: The Eligible Account or Accounts established
and
maintained pursuant to Section 3.06(a) hereof.
Event of Default: As defined in Section 7.01 hereof.
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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 Rate: As to each Mortgage Loan, the sum of the Master
Servicing Fee Rate and the Trustee Fee Rate.
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
thereto.
Final Certification: As defined in Section 2.02(a) hereof.
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
thereto.
Form 10-D Disclosure Item: With respect to any Person, any
material
litigation or governmental proceedings pending against such Person,
or against
any of the Trust Fund, the Depositor, the Trustee, the 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.
Funding Period: The period from the Closing Date until the
earliest
of (i) the date on which the amount on deposit in the Pre-funding
Account is
less than $150,000, (ii) an Event of Default occurs and (iii)
December 31, 2006.
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Funding Period Distribution Date: Each Distribution Date during
the
Funding Period and, if the Funding Period ends after the
Distribution Date in a
month, the immediately succeeding Distribution Date.
Group 1 Mortgage Loans: The Mortgage Loans in Loan Group 1.
Group 1 Senior Certificates: As specified in the Preliminary
Statement.
Group 2 Mortgage Loans: The Mortgage Loans in Loan Group 2.
Group 2 Senior Certificates: As specified in the Preliminary
Statement.
Index: With respect to any Interest Accrual Period for the COFI
Certificates, if any, the then-applicable index used by the Trustee
pursuant to
Section 4.07 to determine the applicable Pass-Through Rate for such
Interest
Accrual Period for the COFI Certificates.
Indirect Participant: A broker, dealer, bank or other financial
institution or other Person that clears through or maintains a
custodial
relationship with a Depository Participant.
Initial Certification: As defined in Section 2.02(a) hereof.
Initial Component Balance: As specified in the Preliminary
Statement.
Initial Cut-off Date: With respect to any Initial Mortgage Loan,
the
later of (i) the date of origination of such Mortgage Loan and (ii)
November 1,
2006.
Initial Cut-off Date Pool Principal Balance: $817,977,383.73.
Initial Mortgage Loan: With respect to any Mortgage Loan included
in
each Loan Group, a Mortgage Loan conveyed to the Trust Fund on the
Closing Date
pursuant to this Agreement as identified on the Mortgage Loan
Schedule delivered
to the Trustee on the Closing Date.
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 Lower Tier 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
Lower Tier REMIC Regular Interest and any Distribution Date, the
one month
period commencing on the 25th day of the month preceding the month
in which such
Distribution Date occurs and ending on the 24th day of the month in
which such
Distribution Date occurs.
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.
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Item 1119 Party: The Depositor, any Seller, the Master Servicer,
the
Trustee, any Subservicer, any originator identified in the
Prospectus
Supplement, the Corridor Contract 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 borrower) acquires the Primary Insurance
Policy and
charges the related borrower 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.
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)).
LIBOR Certificates: As specified in the Preliminary Statement.
Liquidated Mortgage Loan: With respect to any Distribution Date,
a
defaulted Mortgage Loan (including any REO Property) which was
liquidated in the
calendar month preceding the month of such Distribution Date and as
to which the
Master Servicer has determined (in accordance with this Agreement)
that it has
received all amounts it expects to receive in connection with the
liquidation of
such Mortgage Loan, including the final disposition of an REO
Property.
Liquidation Proceeds: Amounts, including Insurance Proceeds,
received in connection with the partial or complete liquidation of
defaulted
Mortgage Loans, whether through trustee's sale, foreclosure sale or
otherwise or
amounts received in connection with any condemnation or partial
release of a
Mortgaged Property and any other proceeds received in connection
with an REO
Property, less the sum of related unreimbursed Master Servicing
Fees, Servicing
Advances and Advances.
Loan Group: Any of Loan Group 1 or Loan Group 2, as applicable.
Loan Group 1: All Mortgage Loans identified as Group 1 Mortgage
Loans on the Mortgage Loan Schedule.
Loan Group 2: All Mortgage Loans identified as Group 2 Mortgage
Loans on the Mortgage Loan Schedule.
Loan Group Principal Balance: As to any Distribution Date and
Loan
Group, the aggregate Stated Principal Balance of the Mortgage Loans
in that Loan
Group as of the Due Date in the month preceding the month of the
Distribution
Date (after giving effect to Principal Prepayments received in the
Prepayment
Period related to such prior Due Date), plus the amount, if any, on
deposit in
the Pre-funding Account with respect to that Loan Group.
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
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<PAGE>
the related Mortgage Loan at such 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.
Lower Tier REMIC: As specified in the Preliminary Statement.
Lower Tier REMIC Interest: As specified in the Preliminary
Statement.
Lower Tier REMIC Regular Interest: As specified in the
Preliminary
Statement.
LTR-A-R Interest: As specified in the Preliminary Statement.
Maintenance: With respect to any Cooperative Unit, the rent paid
by
the Mortgagor to the Cooperative Corporation pursuant to the
Proprietary Lease.
Majority in Interest: As to any Class of Regular Certificates,
the
Holders of Certificates of such Class evidencing, in the aggregate,
at least 51%
of the Percentage Interests evidenced by all Certificates of such
Class.
Master REMIC: As described in the Preliminary Statement.
Master Servicer: Countrywide Home Loans Servicing LP, a Texas
limited partnership, and its successors and assigns, in its
capacity as master
servicer hereunder.
Master Servicer Advance Date: As to any Distribution Date,
12:30
p.m. Pacific time on the Business Day immediately preceding such
Distribution
Date.
Master Servicing Fee: As to each Mortgage Loan and any
Distribution
Date, an amount payable out of each full payment of interest
received on such
Mortgage Loan and equal to one-twelfth of the Master Servicing Fee
Rate
multiplied by the Stated Principal Balance of such Mortgage Loan as
of the Due
Date in the month preceding the month of such Distribution Date,
subject to
reduction as provided in Section 3.14.
Master Servicing Fee Rate: With respect to each Mortgage Loan,
0.250% per annum.
MERS: Mortgage Electronic Registration Systems, Inc., a
corporation
organized and existing under the laws of the State of Delaware, or
any successor
thereto.
MERS Mortgage Loan: Any Mortgage Loan registered with MERS on
the
MERS System.
MERS (R) System: The system of recording transfers of mortgages
electronically maintained by MERS.
Middle Tier REMIC: As specified in the Preliminary Statement.
Middle Tier REMIC Interest: As specified in the Preliminary
Statement.
MIN: The Mortgage Identification Number for any MERS Mortgage
Loan.
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<PAGE>
MOM Loan: Any Mortgage Loan as to which MERS is acting as
mortgagee,
solely as nominee for the originator of such Mortgage Loan and its
successors
and assigns.
Monthly Statement: The statement delivered to the
Certificateholders
pursuant to Section 4.06.
Moody's: Moody's Investors Service, Inc., or any successor
thereto.
If Moody's is designated as a Rating Agency in the Preliminary
Statement, for
purposes of Section 10.05(b) the address for notices to Moody's
shall be Moody's
Investors Service, Inc., 99 Church Street, New York, New York
10007, Attention:
Residential Pass-Through Monitoring, or such other address as
Moody's may
hereafter furnish to the Depositor or the Master Servicer.
Mortgage: The mortgage, deed of trust or other instrument creating
a
first lien on an estate in fee simple or leasehold interest in real
property
securing a Mortgage Note.
Mortgage File: The mortgage documents listed in Section 2.01
hereof
pertaining to a particular Mortgage Loan and any additional
documents delivered
to the Trustee to be added to the Mortgage File pursuant to this
Agreement.
Mortgage Loans: Such of the mortgage loans as from time to time
are
transferred and assigned to the Trustee pursuant to the provisions
hereof and
any Supplemental Transfer Agreement and that are held as a part of
the Trust
Fund (including any REO Property), the mortgage loans so held being
identified
in the Mortgage Loan Schedule, notwithstanding foreclosure or other
acquisition
of title of the related Mortgaged Property.
Mortgage Loan Schedule: The list of Mortgage Loans (as from time
to
time amended by the Master Servicer to reflect the addition of
Substitute
Mortgage Loans, the addition of any Supplemental Mortgage Loans
pursuant to the
provisions of this Agreement and any Supplemental Transfer
Agreement, and the
deletion of Deleted Mortgage Loans pursuant to the provisions of
this Agreement)
transferred to the Trustee as part of the Trust Fund and from time
to time
subject to this Agreement, attached hereto as Schedule I, setting
forth the
following information with respect to each Mortgage Loan by Loan
Group:
(i)
the loan number;
(ii) the
Mortgagor's name and the street address of the Mortgaged
Property, including the zip code;
(iii)
the maturity
date;
(iv) the
original principal balance;
(v)
the Cut-off Date Principal Balance;
(vi) the
first payment date of the Mortgage Loan;
(vii) the
Scheduled Payment in effect as of the Cut-off Date;
(viii) the
Loan-to-Value Ratio at origination;
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<PAGE>
(ix) a
code indicating whether the residential dwelling at the
time of origination was represented to be owner-occupied;
(x)
a code indicating whether the residential dwelling is either
(a) a detached single family dwelling (b) a dwelling in a de
minimis PUD, (c) a condominium unit or PUD (other than a de
minimis PUD), (d) a two- to four-unit residential property
or (e) a Cooperative Unit;
(xi) the
Mortgage Rate in effect on the Cut-off Date;
(xii) 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;
(xiii) 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;
(xiv) the
purpose for the Mortgage Loan;
(xv) the
type of documentation program pursuant to which the
Mortgage Loan was originated;
(xvi)
[Reserved]; and
(xvii) a code
indicating whether the Mortgage Loan is a MERS
Mortgage Loan.
Such
schedule shall also set forth the total of the amounts
described
under (iv) and (v) above for all of the Mortgage Loans and for each
Loan Group.
Countrywide shall update the Mortgage Loan Schedule in connection
with each
Supplemental Transfer Agreement within a reasonable period of time
after
delivery to it of the Schedule of Supplemental Mortgage Loans
attached to the
related Supplemental Transfer Agreement as Schedule A thereto.
Mortgage Note: The original executed note or other evidence of
indebtedness evidencing the indebtedness of a Mortgagor under a
Mortgage Loan.
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.
MTR-A-R Interest: As specified in the Preliminary Statement.
National Cost of Funds Index: The National Monthly Median Cost
of
Funds Ratio to SAIF-Insured Institutions published by the Office of
Thrift
Supervision.
Net Prepayment Interest Shortfalls: As to any Distribution Date
and
Loan Group, the amount by which the aggregate of Prepayment
Interest Shortfalls
for such Loan Group exceeds an amount
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<PAGE>
equal to the sum of (a) the Compensating Interest for such Loan
Group and
Distribution Date and (b) the excess, if any, of the Compensating
Interest for
the other Loan Group for such Distribution Date over Prepayment
Interest
Shortfalls experienced by the Mortgage Loans in such other Loan
Group.
Non-Delay Certificates: As specified in the Preliminary
Statement.
Non-Discount Mortgage Loan: Any Mortgage Loan in a Loan Group
with
an Adjusted Net Mortgage Rate that is greater than or equal to the
Required
Coupon for such Loan Group.
Non-PO Formula Principal Amount: As to any Distribution Date
and
Loan Group, the sum of (i) the sum of the applicable Non-PO
Percentage of (a)
the principal portion of each Scheduled Payment (without giving
effect to any
reductions thereof caused by any Debt Service Reductions or
Deficient
Valuations) due on each Mortgage Loan in related Loan Group on the
related Due
Date, (b) the Stated Principal Balance of each Mortgage Loan in the
related Loan
Group that was repurchased by a Seller or purchased by the Master
Servicer
pursuant to this Agreement as of such Distribution Date, (c) the
Substitution
Adjustment Amount in connection with any Deleted Mortgage Loan in
Loan Group 1
received with respect to such Distribution Date, (d) any Insurance
Proceeds or
Liquidation Proceeds allocable to recoveries of principal of
Mortgage Loans in
Loan Group 1 that are not yet Liquidated Mortgage Loans received
during the
calendar month preceding the month of such Distribution Date, (e)
with respect
to each Mortgage Loan in Loan Group 1 that became a Liquidated
Mortgage Loan
during the calendar month preceding the month of such Distribution
Date, the
amount of the Liquidation Proceeds allocable to principal received
during the
calendar month preceding the month of such Distribution Date with
respect to
such Mortgage Loan and (f) all Principal Prepayments for Loan Group
1 received
during the related Prepayment Period, (ii) (A) any Subsequent
Recoveries
received on the Mortgage Loans in that Loan Group during the
calendar month
preceding the month of such Distribution Date, or (B) with respect
to Subsequent
Recoveries attributable to a Discount Mortgage Loan in such Loan
Group which
incurred a Realized Loss after the Senior Credit Support Depletion
Date, the
Non-PO Percentage of such Subsequent Recoveries received during the
calendar
month preceding the month of such Distribution Date and (iii) the
last Funding
Period Distribution Date, the Remaining Non-PO Pre-funded Amount,
if any,
allocable to such Loan Group.
Non-PO Percentage: As to any Discount Mortgage Loan in a Loan
Group,
a fraction (expressed as a percentage) the numerator of which is
the Adjusted
Net Mortgage Rate of such Discount Mortgage Loan and the
denominator of which is
the Required Coupon for such Loan Group. As to any Non-Discount
Mortgage Loan,
100%.
Non-PO Pool Balance: As to any Loan Group and any Due Date, the
amount equal to the excess, if any, of (i) the aggregate Stated
Principal
Balance of all Mortgage Loans in the related Loan Group over (ii)
the sum of the
PO Percentage of the Stated Principal Balance of each Discount
Mortgage Loan in
that Loan Group.
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,
Subsequent Recoveries
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.
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Notional Amount: With respect to any Distribution Date and the
Class
1-A-7 Certificates, an amount equal to the Class Certificate
Balance of the
Class 1-A-6 Certificates immediately prior to such Distribution
Date.
With respect to any Distribution Date and the Class 1-A-12
Certificates, an amount equal to the Class Certificate Balance of
the Class
1-A-11 Certificates immediately prior to such Distribution
Date.
With respect to any Distribution Date and the Class 2-A-2
Certificates, an amount equal to the aggregate Class Certificate
Balance of the
Class 2-A-1, Class 2-A-4 and Class 2-A-5 Certificates immediately
prior to such
Distribution Date.
With respect to any Distribution Date and the Class 1-X
Certificates, an amount equal to the aggregate of the Stated
Principal Balances
of the Non-Discount Mortgage Loans in Loan Group 1 as of the Due
Date in the
preceding calendar month (after giving effect to Principal
Prepayments received
in the Prepayment Period related to such Due Date).
With respect to any Distribution Date and the Class 2-X
Certificates, an amount equal to the aggregate of the Stated
Principal Balances
of the Non-Discount Mortgage Loans in Loan Group 2 as of the Due
Date in the
preceding calendar month (after giving effect to Principal
Prepayments received
in the Prepayment Period related to such Due Date).
Notional Amount Certificates: As specified in the Preliminary
Statement.
Novation Confirmation: With respect to the Class 1-A-6
Certificates,
the novation confirmation (reference FXNEC8899), dated November 30,
2006,
evidencing a transaction among Deutsche Bank AG, New York Branch,
the
Supplemental Interest Trustee and Bear Stearns Financial Products
Inc., a form
of which is attached hereto at Exhibit S-1.
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
or (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.
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 created
hereunder
in connection with the purchase of the Mortgage Loans pursuant to
Section
9.01(a) hereof.
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<PAGE>
Original Applicable Credit Support Percentage: With respect to
each
of the following Classes of Certificates, the corresponding
percentage described
below, as of the Closing Date:
Class M-1..................... 5.35%
Class M-2..................... 3.45%
Class M-3..................... 2.95%
Class M-4..................... 2.20%
Class M-5..................... 1.95%
Class M-6..................... 1.70%
Class M-7..................... 1.40%
Class B-1..................... 1.25%
Class B-2..................... 1.10%
Class B-3..................... 0.95%
Class B-4..................... 0.70%
Class B-5..................... 0.30%
Original Mortgage Loan: The mortgage loan refinanced in
connection
with the origination of a Refinancing Mortgage Loan.
Original Subordinate Principal Balance: On or prior to a Senior
Termination Date, the Subordinated Percentage for a Loan Group of
the aggregate
of the applicable Non-PO Percentage of the Stated Principal
Balances of the
Mortgage Loans in such Loan Group, in each case as of the Cut-off
Date; or if
such date is after a Senior Termination Date, the aggregate of the
Class
Certificate Balances of the Subordinated Certificates as of the
Closing Date.
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 such Due Date or during the
Prepayment
Period related to such Due Date and which did not become a
Liquidated Mortgage
Loan prior to such Due Date.
Overcollateralized Group: As defined in Section 4.05.
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.
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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 Rate: For any interest bearing Class of Certificates
or
Component, the per annum rate set forth or calculated in the manner
described in
the Preliminary Statement.
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.
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
I-20
<PAGE>
company system, the commercial paper or long-term unsecured
debt obligations of such holding company, but only if
Moody's is not a Rating Agency) are then rated one of the
two highest long-term and the highest short-term ratings of
each Rating Agency for such securities, or such lower
ratings as will not result in the downgrading or withdrawal
of the rating then assigned to the Certificates by either
Rating Agency;
(v)
repurchase obligations with respect to any security
described in clauses (i) and (ii) above, in either case
entered into with a depository institution or trust company
(acting as principal) described in clause (iv) above;
(vi) units
of a taxable money-market portfolio having the highest
rating assigned by each Rating Agency (except if Fitch is a
Rating Agency and has not rated the portfolio, the highest
rating assigned by Moody's) and restricted to obligations
issued or guaranteed by the United States of America or
entities whose obligations are backed by the full faith and
credit of the United States of America and repurchase
agreements collateralized by such obligations; and
(vii) such other
relatively risk free investments bearing interest
or sold at a discount acceptable to each Rating Agency as
will not result in the downgrading or withdrawal of the
rating then assigned to the Certificates by either Rating
Agency, as evidenced by a signed writing delivered by each
Rating Agency
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)(l) 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 hereunder 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.
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<PAGE>
Person: Any individual, corporation, partnership, joint
venture,
limited liability company, association, joint-stock company,
trust,
unincorporated organization or government, or any agency or
political
subdivision thereof.
Physical Certificate: As specified in the Preliminary
Statement.
Plan: An "employee benefit plan" as defined in section 3(3) of
ERISA
that is subject to Title I of ERISA, a "plan" as defined in section
4975 of the
Code that is subject to section 4975 of the Code, or any Person
investing on
behalf of or with plan assets (as defined in 29 CFR ss.2510.3-101
or otherwise
under ERISA) of such an employee benefit plan or plan.
Planned Balance: With respect to any group of Planned Principal
Classes or Components in the aggregate and any Distribution Date
appearing in
Schedule V hereto, the Aggregate Planned Balance for such group and
Distribution
Date. With respect to any other Planned Principal Class or
Component and any
Distribution Date appearing in Schedule V hereto, the applicable
amount
appearing opposite such Distribution Date for such Class or
Component.
Planned Principal Classes: As specified in the Preliminary
Statement.
PO Formula
Principal Amount: As to any Distribution Date and related
Class PO Component, the sum of (i) the sum of the applicable PO
Percentage of
(a) the principal portion of each Scheduled Payment (without giving
effect to
any reductions thereof caused by any Debt Service Reductions or
Deficient
Valuations) due on each Mortgage Loan in related Loan Group on the
related Due
Date, (b) the Stated Principal Balance of each Mortgage Loan in the
related Loan
Group that was repurchased by a Seller or purchased by the Master
Servicer
pursuant to this Agreement as of such Distribution Date, (c) the
Substitution
Adjustment Amount in connection with any Deleted Mortgage Loan in
the related
Loan Group received with respect to such Distribution Date, (d) any
Insurance
Proceeds or Liquidation Proceeds allocable to recoveries of
principal of
Mortgage Loans in the related Loan Group that are not yet
Liquidated Mortgage
Loans received during the calendar month preceding the month of
such
Distribution Date, (e) with respect to each Mortgage Loan in Loan
Group 1 that
became a Liquidated Mortgage Loan during the calendar month
preceding the month
of such Distribution Date, the amount of Liquidation Proceeds
allocable to
principal received with respect to such Mortgage Loan during the
calendar month
preceding the month of such Distribution Date with respect to such
Mortgage
Loan, and (f) all Principal Prepayments with respect to the
Mortgage Loans in
the related Loan Group received during the related Prepayment
Period, (ii) with
respect to Subsequent Recoveries attributable to a Discount
Mortgage Loan in the
related Loan Group which incurred a Realized Loss after the Senior
Credit
Support Depletion Date, the PO Percentage of any such Subsequent
Recoveries on
the Mortgage Loans in such Loan Group received during the calendar
month
preceding the month of such Distribution Date, and (iii) with
respect to the
last Funding Period Distribution Date, the Remaining PO Pre-funded
Amount, if
any, allocable to such Loan Group.
PO Percentage: As to any Discount Mortgage Loan in a Loan Group,
a
fraction (expressed as a percentage) the numerator of which is the
excess of the
Required Coupon for such Loan Group over the Adjusted Net Mortgage
Rate of such
Discount Mortgage Loan and the denominator of which is such
Required Coupon. As
to any Non-Discount Mortgage Loan, 0%.
PO Sublimit: $465,665.
Pool Characteristics: As of the Cut-off Date, the
characteristics
set forth in the sixth bullet point under "The Mortgage
Pool--Conveyance of
Supplemental Mortgage Loans" for Loan Group 1 and Loan Group 2 set
forth on page
S-64 of the Prospectus Supplement.
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<PAGE>
Pool Stated Principal Balance: As of any date of determination,
the
aggregate of the Stated Principal Balances of the Outstanding
Mortgage Loans
plus the amount on deposit in the Pre-funding Account exclusive of
any
investment income included therein.
Pre-funded Amount: The amount deposited in the Pre-funding
Account
on the Closing Date, which shall equal $4,421.03.
Pre-funding Account: The separate Eligible Account created and
maintained by the Trustee pursuant to Section 3.05 in the name of
the Trustee
for the benefit of the Certificateholders and designated "The Bank
of New York,
in trust for registered holders of Alternative Loan Trust
2006-39CB, Mortgage
Pass-Through Certificates, Series 2006-39CB." Funds in the
Pre-funding Account
shall be held in trust for the Certificateholders for the uses and
purposes set
forth in this Agreement and shall not be a part of any REMIC
created hereunder;
provided, however, that any investment income earned from Permitted
Investments
made with funds in the Pre-funding Account shall be for the account
of the
Depositor.
Prepayment Charge: With respect to any Mortgage Loan, the charges
or
premiums, if any, due in connection with a full or partial
Principal Prepayment
of such Mortgage Loan within the related Prepayment Charge Period
in accordance
with the terms thereof.
Prepayment Charge Amount: Not Applicable.
Prepayment Charge Period: With respect to any Mortgage Loan,
the
period of time during which a Prepayment Charge may be imposed.
Prepayment Interest Excess: As to any Principal Prepayment
received
by Countrywide Home Loans Servicing LP from the first day through
the fifteenth
day of any calendar month (other than the calendar month in which
the Initial
Cut-off Date occurs), all amounts paid by the related Mortgagor in
respect of
interest on such Principal Prepayment. All Prepayment Interest
Excess shall be
paid to the Master Servicer as additional master servicing
compensation.
Prepayment Interest Shortfall: As to any Distribution Date,
Mortgage
Loan and Principal Prepayment received on or after the sixteenth
day of the
month preceding the month of such Distribution Date (or, in the
case of the
first Distribution Date, on or after November 1, 2006) and on or
before the last
day of the month preceding the month of such Distribution Date, the
amount, if
any, by which one month's interest at the related Mortgage Rate,
net of the
Master Servicing Fee Rate, on such Principal Prepayment exceeds the
amount of
interest paid in connection with such Principal Prepayment.
Prepayment Period: As to any Distribution Date and the related
Due
Date, the period from the 16th day of the calendar month
immediately preceding
the month of such Distribution Date (or, in the case of the first
Distribution
Date, from November 1, 2006) through the 15th day of the calendar
month of such
Distribution Date.
Prepayment Shift Percentage: Not Applicable.
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
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<PAGE>
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 Only Certificates: As specified in the Preliminary
Statement.
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 Relocation Payment: A payment from any Loan Group to
an
Lower Tier REMIC Regular Interest other than a Regular Interest
corresponding to
that Loan Group as provided in the Preliminary Statement. Principal
Relocation
Payments from a Loan Group shall be made of the amounts in respect
of principal
from the Mortgage Loans of the Loan Group and shall include a
proportionate
allocation of the Realized Losses from the Mortgage Loans of the
Loan Group.
Priority Amount: For any Distribution Date, an amount equal to
the
sum of (i) the product of (A) the Scheduled Principal Distribution
Amount for
Loan Group 1, (B) the Shift Percentage, (C) the Group 1 Priority
Percentage and
(D) the Senior Percentage and (ii) the product of (A) the
Unscheduled Principal
Distribution Amount for Loan Group 1, (B) the Shift Percentage, (C)
the Group 1
Priority Percentage and (D) the Senior Prepayment Percentage.
Priority Percentage: As to any Distribution Date, the
percentage
equivalent of a fraction, the numerator of which is the aggregate
Class
Certificate Balance of the Class 1-A-4, Class 1-A-19 and Class
1-A-20
Certificates immediately prior to such Distribution Date, and the
denominator of
which is the Non-PO Pool Balance for Loan Group 1 as of the Due
Date in the
month preceding the month of such Distribution Date (after giving
effect to
Principal Prepayments on the Mortgage Loans in Loan Group 1
received in the
Prepayment Period related to the prior Due Date).
Private Certificate: As specified in the Preliminary Statement.
Pro Rata Share: As to any Distribution Date, the Subordinated
Principal Distribution Amount and any Class of Subordinated
Certificates, the
portion of the Subordinated Principal Distribution Amount allocable
to such
Class, equal to the product of the Subordinated Principal
Distribution Amount on
such Distribution Date and a fraction, the numerator of which is
the related
Class Certificate Balance thereof and the denominator of which is
the aggregate
of the Class Certificate Balances of the Subordinated
Certificates.
Proprietary Lease: With respect to any Cooperative Unit, a lease
or
occupancy agreement between a Cooperative Corporation and a holder
of related
Coop Shares.
Prospectus: The Prospectus dated November 14, 2006 generally
relating to mortgage pass-through certificates to be sold by the
Depositor.
Prospectus Supplement: The Prospectus Supplement dated November
29,
2006 relating to the Offered Certificates, as supplemented by the
Supplement to
the Prospectus Supplement dated November 30, 2006.
I-24
<PAGE>
PUD: Planned Unit Development.
Purchase Price: With respect to any Mortgage Loan required to
be
purchased by a Seller pursuant to Section 2.02 or 2.03 hereof 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
hereof that arises out of a violation of any predatory or abusive
lending law
with respect to the related Mortgage Loan.
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 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 herein
to a given
rating category of a Rating Agency shall mean such rating category
without
giving effect to any modifiers.
Realized Loss: With respect to 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 Liquidated Mortgage Loan, the amount of the
Realized Loss
with respect to that Mortgage Loan will be reduced by 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.
I-25
<PAGE>
Record Date: As to any Distribution Date, the close of business
on
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.
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.
Relief Act Reductions: With respect to any Distribution Date and
any
Mortgage Loan as to which there has been a reduction in the amount
of interest
collectible thereon for the most recently ended calendar month as a
result of
the application of the Relief Act or any similar state laws, the
amount, if any,
by which (i) interest collectible on such Mortgage Loan for the
most recently
ended calendar month is less than (ii) interest accrued thereon for
such month
pursuant to the Mortgage Note.
Remaining Non-PO Pre-funded Amount: With respect to Loan Group 1
and
the last Funding Period Distribution Date, the excess of the amount
on deposit
in the Pre-funding Account attributable to Loan Group 1 on such
date over the
Remaining PO Pre-funded Amount.
Remaining PO Pre-funded Amount: With respect to a Loan Group and
the
last Funding Period Distribution Date, the excess of the PO
Sublimit for such
Loan Group, if any, over the product of the applicable PO
Percentage of the
Stated Principal Balance of each Supplemental Mortgage Loan as of
the related
Supplemental Cut-off Date added to that Loan Group.
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:
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<PAGE>
(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, 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;
(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, as
appropriate.
Required Coupon: With respect to the Mortgage Loans in Loan Group
1,
6.00% per annum and with respect to the Mortgage Loans in Loan
Group 2, 6.75%
per annum.
I-27
<PAGE>
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.
Restricted Classes: As defined in Section 4.02(e).
S&P: Standard & Poor's, a division of The McGraw-Hill
Companies,
Inc. If S&P is designated as a Rating Agency in the Preliminary
Statement, for
purposes of Section 10.05(b) the address for notices to S&P
shall be Standard &
Poor's, 55 Water Street, New York, New York 10041, Attention:
Mortgage
Surveillance Monitoring, or such other address as S&P may
hereafter furnish to
the Depositor and the Master Servicer.
Sarbanes-Oxley Certification: As defined in Section 11.05.
Scheduled Balances: With respect to any group of Scheduled
Principal
Classes or Components in the aggregate and any Distribution Date
appearing in
Schedule V hereto, the Aggregate Scheduled Balance for such group
and
Distribution Date. With respect to any other Scheduled Principal
Class or
Component and any Distribution Date appearing in Schedule V hereto,
the
applicable amount appearing opposite such Distribution Date for
such Class or
Component.
Scheduled Principal 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 herein, shall give effect to any
related Debt
Service Reduction and any Deficient Valuation that affects the
amount of the
monthly payment due on such Mortgage Loan.
Scheduled Principal Distribution Amount: As to any Distribution
Date
and Loan Group, an amount equal to the Non-PO Percentage of all
amounts
described in subclauses (a) through (d) of clause (i) of the
definition of
Non-PO Formula Principal Amount for such Loan Group and
Distribution Date.
Securities Act: The Securities Act of 1933, as amended.
Seller: Countrywide, Park Granada, Park Monaco or Park Sienna,
as
applicable.
Senior Certificate Group: As specified in the Preliminary
Statement.
Senior Certificates: As specified in the Preliminary Statement.
Senior Credit Support Depletion Date: The date on which the
Class
Certificate Balance of each Class of Subordinated Certificates has
been reduced
to zero.
I-28
<PAGE>
Senior Percentage: As to any Senior Certificate Group and
Distribution Date, the percentage equivalent of a fraction the
numerator of
which is the aggregate of the Class Certificate Balances of each
Class of Senior
Certificates of such Senior Certificate Group (other than the
related Class PO
Component and Notional Amount Certificates) immediately prior to
such
Distribution Date and the denominator of which is the aggregate of
the
applicable Non-PO Percentage of the Stated Principal Balance of
each Mortgage
Loan in the related Loan Group as of the Due Date occurring in the
month prior
to the month of such Distribution Date (after giving effect to
Principal
Prepayments received in the Prepayment Period related to such prior
Due Date);
provided, however, that on any Distribution Date after a Senior
Termination
Date, the Senior Percentage for the Senior Certificates of the
remaining Senior
Certificate Group is the percentage equivalent of a fraction, the
numerator of
which is the aggregate of the Class Certificate Balances of each
such Class of
Senior Certificates (other than the related Class PO Component and
Notional
Amount Certificates) of such remaining Senior Certificate Group
immediately
prior to such Distribution Date and the denominator is the
aggregate of the
Class Certificate Balances of all Classes of Certificates (other
than the Class
PO Certificates and the Notional Amount Certificates), immediately
prior to such
Distribution Date.
Senior Prepayment Percentage: As to a Senior Certificate Group
and
any Distribution Date during the five years beginning on the first
Distribution
Date, 100%. The Senior Prepayment Percentage for any Distribution
Date occurring
on or after the fifth anniversary of the first Distribution Date
will, except as
provided herein, be as follows: for any Distribution Date in the
first year
thereafter, the related Senior Percentage plus 70% of the related
Subordinated
Percentage for such Distribution Date; for any Distribution Date in
the second
year thereafter, the related Senior Percentage plus 60% of the
related
Subordinated Percentage for such Distribution Date; for any
Distribution Date in
the third year thereafter, the related Senior Percentage plus 40%
of the related
Subordinated Percentage for such Distribution Date; for any
Distribution Date in
the fourth year thereafter, the related Senior Percentage plus 20%
of the
related Subordinated Percentage for such Distribution Date; and for
any
Distribution Date thereafter, the related Senior Percentage for
such
Distribution Date (unless on any Distribution Date the Senior
Percentage exceeds
the initial Senior Percentage of such Senior Certificate Group, in
which case
the Senior Prepayment Percentage for each Senior Certificate Group
for such
Distribution Date will once again equal 100%). Notwithstanding the
foregoing, no
decrease in any Senior Prepayment Percentage will occur unless both
of the
Senior Step Down Conditions are satisfied with respect to all of
the Loan
Groups.
Senior Principal Distribution Amount: As to any Distribution
Date
and Senior Certificate Group, the sum of (i) the sum of the related
Senior
Percentage of the applicable Non-PO Percentage of all amounts
described in
subclauses (a) through (d) of clause (i) of the definition of
"Non-PO Formula
Principal Amount" with respect to the related Loan Group for such
Distribution
Date, (ii) with respect to any Mortgage Loan in the related Loan
Group that
became a Liquidated Mortgage Loan during the calendar month
preceding the month
of such Distribution Date, the lesser of (x) the related Senior
Percentage of
the applicable Non-PO Percentage of the Stated Principal Balance of
such
Mortgage Loan and (y) the related Senior Prepayment Percentage of
the applicable
Non-PO Percentage of the amount of the Liquidation Proceeds
allocable to
principal received with respect to the Mortgage Loan and (iii) the
sum of (x)
the related Senior Prepayment Percentage of the applicable Non-PO
Percentage of
the amounts described in subclause (f) of clause (i) of the
definition of
"Non-PO Formula Principal Amount" with respect to the related Loan
Group for
such Distribution Date plus (y) the related Senior Prepayment
Percentage of any
Subsequent Recoveries described in clause (ii) of the definition of
"Non-PO
Formula Principal Amount" for such Distribution Date ; provided,
however, on any
Distribution Date after a Senior Termination Date, the Senior
Principal
Distribution Amount for the remaining Senior Certificate Group will
be
calculated pursuant to the above formula based on all the Mortgage
Loans in the
Mortgage Pool, as opposed to the Mortgage Loans in the related Loan
Group and,
if such Distribution Date is a Senior Termination Date, shall be
reduced by the
amount of the principal distribution made pursuant to
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<PAGE>
(a) if the Group 1 Senior Certificates are reduced to zero on such
date, Section
4.02(a)(1)(iv)(y) and (b) if the Group 2 Senior Certificates are
reduced to zero
on such date, Section 4.02(a)(2)(iv)(y).
Senior Step Down Conditions: With respect to the Mortgage Loans in
a
Loan Group: (i) the outstanding principal balance of all Mortgage
Loans
delinquent 60 days or more (including Mortgage Loans in
foreclosure, REO
Property and Mortgage Loans the mortgagors of which are in
bankruptcy) (averaged
over the preceding six month period), as a percentage of (a) if
such date is on
or prior to a Senior Termination Date, the Subordinated Percentage
for such Loan
Group of the aggregate of the applicable Non-PO Percentage of the
aggregate
Stated Principal Balance of the Mortgage Loans in that Loan Group,
or (b) if
such date is after a Senior Termination Date, the aggregate Class
Certificate
Balance of the Subordinated Certificates, does not equal or exceed
50%, and (ii)
cumulative Realized Losses on the Mortgage Loans in each Loan Group
do not
exceed: (a) commencing with the Distribution Date on the fifth
anniversary of
the first Distribution Date, 30% of the Original Subordinate
Principal Balance,
(b) commencing with the Distribution Date on the sixth anniversary
of the first
Distribution Date, 35% of the Original Subordinate Principal
Balance, (c)
commencing with the Distribution Date on the seventh anniversary of
the first
Distribution Date, 40% of the Original Subordinate Principal
Balance, (d)
commencing with the Distribution Date on the eighth anniversary of
the first
Distribution Date, 45% of the Original Subordinate Principal
Balance, and (e)
commencing with the Distribution Date on the ninth anniversary of
the first
Distribution Date, 50% of the Original Subordinate Principal
Balance.
Senior Termination Date: For any Senior Certificate Group, the
Distribution Date on which the aggregate Class Certificate Balance
of the Senior
Certificates in such Senior Certificate Group (other than the
related Class PO
Component) has been reduced to zero.
Servicing Advances: All customary, reasonable and necessary "out
of
pocket" costs and expenses incurred in the performance by the
Master Servicer of
its servicing obligations, including, but not limited to, the cost
of (i) the
preservation, restoration and protection of a Mortgaged Property,
(ii) any
expenses reimbursable to the Master Servicer pursuant to Section
3.11 and any
enforcement or judicial proceedings, including foreclosures, (iii)
the
management and liquidation of any REO Property and (iv) compliance
with the
obligations under Section 3.09.
Servicing Criteria: The "servicing criteria" set forth in Item
1122(d) of Regulation AB.
Servicing Officer: Any officer of the Master Servicer involved
in,
or responsible for, the administration and servicing of the
Mortgage Loans whose
name and facsimile signature appear on a list of servicing officers
furnished to
the Trustee by the Master Servicer on the Closing Date pursuant to
this
Agreement, as such list may from time to time be amended.
Shift Percentage: As to any Distribution Date occurring during
the
five years beginning on the first Distribution Date, 0%. For any
Distribution
Date occurring on or after the fifth anniversary of the first
Distribution Date
as follows: for any Distribution Date in the first year thereafter,
30%; for any
Distribution Date in the second year thereafter, 40%; for any
Distribution Date
in the third year thereafter, 60%; for any Distribution Date in the
fourth year
thereafter, 80%; and for any Distribution Date thereafter,
100%.
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
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<PAGE>
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.
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.
Strike Rate: With respect to each Class of Covered Certificates,
the
applicable percentage set forth below:
--------------------------------------------------
Class of Certificates
Strike Rate
-------------------------------- -----------------
Class 1-A-6
5.40%
-------------------------------- -----------------
Class 1-A-11
5.35%
--------------------------------------------------
Subcontractor: Any vendor, subcontractor or other Person that is
not
responsible for the overall servicing (as "servicing" is commonly
understood by
participants in the mortgage-backed securities market) of Mortgage
Loans but
performs one or more discrete functions identified in Item 1122(d)
of Regulation
AB with respect to 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 Percentage: As to any Loan Group and Distribution
Date
on or prior to a Senior Termination Date, 100% minus the Senior
Percentage for
the Senior Certificate Group relating to such Loan Group for such
Distribution
Date. As to any Distribution Date after a Senior Termination Date,
100% minus
the Senior Percentage for such Distribution Date.
Subordinated Portion: For any Distribution Date, an amount equal
to
the aggregate Stated Principal Balance of the Mortgage Loans in the
related Loan
Group as of the end of the Prepayment Period related to the
immediately
preceding Distribution Date, minus the aggregate Class Certificate
Balance of
the related Senior Certificates immediately prior to such
Distribution Date.
Subordinated Prepayment Percentage: As to any Distribution Date
and
Loan Group, 100% minus the related Senior Prepayment Percentage for
such
Distribution Date.
Subordinated Principal Distribution Amount: With respect to any
Distribution Date and Loan Group, an amount equal to the excess of
(A) the sum,
not less than zero, of (i) the Subordinated Percentage of the
applicable Non-PO
Percentage for such Loan Group of all amounts described in
subclauses (a)
through (d) of clause (i) of the definition of "Non-PO Formula
Principal Amount"
for such Distribution Date, (ii) with respect to each Mortgage Loan
that became
a Liquidated Mortgage Loan during the calendar month preceding the
month of such
Distribution Date, the applicable Non-PO
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<PAGE>
Percentage of the amount of the Liquidation Proceeds allocated to
principal
received with respect thereto remaining after application thereof
pursuant to
clause (ii) of the definition of Senior Principal Distribution
Amount, up to the
Subordinated Percentage for such Loan Group of the applicable
Non-PO Percentage
of the Stated Principal Balance of such Mortgage Loan, (iii) the
Subordinated
Prepayment Percentage of the applicable Non-PO Percentage of all
amounts
described in subclause (f) of clause (i) of the definition of
"Non-PO Formula
Principal Amount" for such Loan Group and Distribution Date, and
(iv) the
related Subordinated Prepayment Percentage of any Subsequent
Recoveries
described in clause (ii) of the definition of "Non-PO Formula
Principal Amount"
for such Distribution Date, over (B) the amount of any payments in
respect of
Class PO Deferred Amounts for the related Class PO Component on the
related
Distribution Date, provided, however, that on any Distribution Date
after a
Senior Termination Date, the Subordinated Principal Distribution
Amount will not
be calculated by Loan Group but will equal the amount calculated
pursuant to the
formula set forth above based on the applicable Subordinated
Percentage or
Subordinated Prepayment Percentage, as applicable, for the
Subordinated
Certificates for such Distribution Date with respect to all of the
Mortgage
Loans as opposed to the Mortgage Loans in the related Loan
Group.
Subordinate Pass-Through Rate: For the Interest Accrual Period
related to each Distribution Date, a per annum rate equal to (1)
the sum of the
following for each Loan Group: the product of (x) the Required
Coupon of the
Loan Group and (y) the related Subordinated Portion immediately
prior to that
Distribution Date, divided by (2) the aggregate Class Certificate
Balance of the
Subordinated Certificates immediately prior to that Distribution
Date.
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.
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 hereof.
Substitute Mortgage Loan: A Mortgage Loan substituted by a
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) not be a Cooperative Loan unless the
Deleted
Mortgage Loan was a Cooperative Loan and (vi) comply with each
representation
and warranty set forth in Section 2.03 hereof.
Substitution Adjustment Amount: The meaning ascribed to such
term
pursuant to Section 2.03.
Supplemental Cut-off Date: With respect to any Supplemental
Mortgage
Loan, the later of (i) the date of origination of such Mortgage
Loan and (ii)
the first day of the month in which the related Supplemental
Transfer Date
occurs.
Supplemental Interest Trust: The separate trust created under
this
Agreement pursuant to Section 3.05(i).
I-32
<PAGE>
Supplemental Interest Trustee: The Bank of New York, a New York
banking corporation, not in its individual capacity, but solely in
its capacity
as trustee of the Supplemental Interest Trust for the benefit of
the Holders of
the Covered 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.
Supplemental Mortgage Loan: Any Mortgage Loan, other than an
Initial
Mortgage Loan, conveyed to the Trust Fund pursuant to Section 2.01
hereof and to
a Supplemental Transfer Agreement, which Mortgage Loan shall be
listed on the
revised Mortgage Loan Schedule delivered pursuant to this Agreement
and on
Schedule A to such Supplemental Transfer Agreement. When used with
respect to a
single Supplemental Transfer Date, Supplemental Mortgage Loan shall
mean a
Supplemental Mortgage Loan conveyed to the Trust Fund on that
Supplemental
Transfer Date.
Supplemental Transfer Agreement: A Supplemental Transfer
Agreement
substantially in the form of Exhibit P hereto, executed and
delivered by the
related Seller or Sellers, the Master Servicer, the Depositor and
the Trustee as
provided in Section 2.01 hereof.
Supplemental Transfer Date: For any Supplemental Transfer
Agreement,
the date the related Supplemental Mortgage Loans are transferred to
the Trust
Fund pursuant to the related Supplemental Transfer Agreement.
Targeted
Balance: With respect to any group of Targeted Principal
Classes or Components in the aggregate and any Distribution Date
appearing in
Schedule V hereto, the Aggregate Targeted Balance for such group
and
Distribution Date. With respect to any other Targeted Principal
Class or
Component and any Distribution Date appearing in Schedule V hereto,
the
applicable amount appearing opposite such Distribution Date for
such Class or
Component.
Targeted Principal Classes: As specified in the Preliminary
Statement.
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.
Transaction Documents: This Agreement, the Corridor Contracts
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.
Trust Fund: The corpus of the trust created hereunder 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 thereof; (ii) the Certificate
Account, the
Distribution Account, the Pre-funding Account and the Capitalized
Interest
Account and all amounts deposited therein pursuant to the
applicable provisions
of this Agreement; (iii) property that secured a Mortgage Loan and
has been
acquired by foreclosure, deed-in-lieu of foreclosure or otherwise;
and (iv) all
proceeds of the conversion, voluntary or involuntary, of any of the
foregoing.
I-33
<PAGE>
Trustee: The Bank of New York and its successors and, if a
successor
trustee is appointed hereunder, 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 sum of (i)
the Pool Stated
Principal Balance and (ii) any amounts remaining in the Pre-funding
Account
(excluding any investment earnings thereon) with respect to such
Distribution
Date.
Trustee Fee Rate: With respect to each Mortgage Loan, 0.009%
per
annum.
Undercollateralized Group: As defined in Section 4.05.
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.
Underwriter: As specified in the Preliminary Statement.
Unscheduled Principal Distribution Amount: With respect to any
Distribution Date, an amount equal to the sum of (i) with respect
to each
Mortgage Loan that became a Liquidated Mortgage Loan during the
calendar month
preceding the month of such Distribution Date, the applicable
Non-PO Percentage
of the Liquidation Proceeds allocable to principal received with
respect to such
Mortgage Loan and (ii) the applicable Non-PO Percentage of the
amount described
in subclause (f) of clause (i) of the definition of Non-PO Formula
Principal
Amount for such Distribution Date and (iii) any Subsequent
Recoveries described
in clause (ii) of the definition of Non-PO Formula Principal Amount
for such
Distribution Date.
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), and (b) 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.
Yield Supplement Amount: For any Distribution Date and any Class
of
Covered Certificates on or prior to the applicable Corridor
Contract Termination
Date, on which LIBOR exceeds the applicable Strike Rate, interest
for the
related Interest Accrual Period on the Class Certificate Balance of
that Class
of Covered Certificates immediately prior to such Distribution Date
at a rate
equal to the excess, if any, of (i) the lesser of LIBOR and the
applicable
Ceiling Rate over (ii) the applicable Strike Rate.
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
I-34
<PAGE>
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.
I-35
<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
hereof, hereby sells, transfers, assigns, sets over and otherwise
conveys to the
Depositor, without recourse, all its respective right, title and
interest in and
to the related Initial Mortgage Loans, including all interest and
principal
received or receivable by such Seller, on or with respect to the
applicable
Initial Mortgage Loans after the Initial Cut-off Date and all
interest and
principal payments on the related Initial Mortgage Loans received
prior to the
Initial Cut-off Date in respect of installments of interest and
principal due
thereafter, but not including payments of principal and interest
due and payable
on such Initial Mortgage Loans, on or before the Initial Cut-off
Date. On or
prior to the Closing Date, Countrywide shall deliver to the
Depositor or, at the
Depositor's direction, to the Trustee or other designee of the
Depositor, the
Mortgage File for each Mortgage Loan listed in the Mortgage Loan
Schedule
(except that, in the case of the Delay Delivery Mortgage Loans
(which may
include Countrywide Mortgage Loans, Park Granada Mortgage Loans,
Park Monaco
Mortgage Loans and Park Sienna Mortgage Loans), such delivery may
take place
within thirty (30) days following the Closing Date or twenty (20)
days following
the applicable Supplemental Transfer Date, as applicable). Such
delivery of the
Mortgage Files shall be made against payment by the Depositor of
the purchase
price, previously agreed to by the Sellers and Depositor, for the
Mortgage
Loans. With respect to any Initial Mortgage Loan that does not have
a first
payment date on or before the Due Date in the month of the first
Distribution
Date or any Supplemental Mortgage Loan that does not have a first
payment date
on or before the Due Date in the month after the related
Supplemental Transfer
Date, Countrywide shall deposit into the Distribution Account on or
before the
Distribution Account Deposit Date relating to the first applicable
Distribution
Date, an amount equal to one month's interest at the related
Adjusted Mortgage
Rate on the Cut-off Date Principal Balance of such Mortgage
Loan.
(b) Immediately upon the conveyance of the Initial Mortgage
Loans
referred to in clause (a), the Depositor sells, transfers, assigns,
sets over
and otherwise conveys to the Trustee for the benefit of the
Certificateholders,
without recourse, all the right, title and interest of the
Depositor in and to
the Trust Fund together with the Depositor's right to require each
Seller to
cure any breach of a representation or warranty made herein by such
Seller, or
to repurchase or substitute for any affected Mortgage Loan in
accordance
herewith.
(c) In connection with the transfer and assignment set forth in
clause (b) above, the Depositor has delivered or caused to be
delivered to the
Trustee (or, in the case of the Delay Delivery Mortgage Loans that
are Initial
Mortgage Loans, will deliver or cause to be delivered to the
Trustee within
thirty (30) days following the Closing Date and in the case of the
Delay
Delivery Mortgage Loans that are Supplemental Mortgage Loans, will
deliver or
cause to be delivered to the Trustee within twenty (20) days
following the
applicable Supplemental Transfer Date) for the benefit of the
Certificateholders
the following documents or instruments with respect to each
Mortgage Loan so
assigned:
(i) (A) the original Mortgage Note endorsed by manual or
facsimile
signature in blank in the following form: "Pay to the order of
____________
without 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,
II-1
<PAGE>
title and interest of the party so endorsing, as noteholder or
assignee thereof,
in and to that Mortgage Note); or
(B) with respect to any Lost Mortgage Note, a lost note
affidavit
from Countrywide stating that the original Mortgage Note was lost
or
destroyed, together with a copy of such Mortgage Note;
(ii) except as provided below and for each Mortgage Loan that is
not a
MERS
Mortgage Loan, the original recorded Mortgage or a copy of such
Mortgage, with recording information, certified by Countrywide as
being a
true
and complete copy of the Mortgage (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 duplicate
original
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;
(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 Seller's interest in the Coop Shares and the
Proprietary
Lease; and
II-2
<PAGE>
(F) The executed UCC-3 financing statements or other
appropriate
UCC financing statements required by state law, evidencing a
complete
and unbroken line from the mortgagee to the Trustee with evidence
of
recording thereon (or in a form suitable for recordation).
In addition, in connection with the assignment of any MERS
Mortgage
Loan, each Seller agrees that it will cause, at the Trustee's
expense, the
MERS(R) System to indicate that the Mortgage Loans sold by such
Seller to the
Depositor have been assigned by that Seller to the Trustee in
accordance with
this Agreement (and any Supplemental Transfer Agreement, as
applicable) for the
benefit of the Certificateholders by including (or deleting, in the
case of
Mortgage Loans which are repurchased in accordance with this
Agreement) in such
computer files the information required by the MERS(R) System to
identify the
series of the Certificates issued in connection with such Mortgage
Loans. Each
Seller further agrees that it will not, and will not permit the
Master Servicer
to, and the Master Servicer agrees that it will not, alter the
information
referenced in this paragraph with respect to any Mortgage Loan sold
by such
Seller to the Depositor during the term of this Agreement unless
and until such
Mortgage Loan is repurchased in accordance with the terms of this
Agreement.
In the event that in connection with any Mortgage Loan that is not
a
MERS Mortgage Loan the Depositor cannot deliver (a) the original
recorded
Mortgage, or a copy of such Mortgage, with recording information,
(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 the
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 assignment, 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 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.
II-3
<PAGE>
As promptly as practicable subsequent to such transfer and
assignment, and in any event, within one-hundred and 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
Series
2006-39CB, 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 hereof.
Notwithstanding anything to the contrary in this Agreement,
within
thirty (30) days after the Closing Date with respect to the Initial
Mortgage
Loans, Countrywide (on its own behalf and on behalf of Park
Granada, Park Monaco
and Park Sienna) shall either (i) deliver to the Depositor, or at
the
Depositor's direction, to the Trustee or other designee of the
Depositor the
Mortgage File as required pursuant to this Section 2.01 for each
Delay Delivery
Mortgage Loan or (ii) either (A) substitute a Substitute Mortgage
Loan for the
Delay Delivery Mortgage Loan or (B) repurchase the Delay Delivery
Mortgage Loan,
which substitution or repurchase shall be accomplished in the
manner and subject
to the conditions set forth in Section 2.03 (treating each Delay
Delivery
Mortgage Loan as a Deleted Mortgage Loan for purposes of such
Section 2.03);
provided, however, that if Countrywide fails to deliver a Mortgage
File for any
Delay Delivery Mortgage Loan within the thirty (30) day period
provided in the
prior sentence, Countrywide (on its own behalf and on behalf of
Park Granada,
Park Monaco and Park Sienna) shall use its best reasonable efforts
to effect a
substitution, rather than a repurchase of, such Deleted Mortgage
Loan and
provided further that the cure period provided for in Section 2.02
or in Section
2.03 shall not apply to the initial delivery of the Mortgage File
for such Delay
Delivery Mortgage Loan, but rather Countrywide (on its own behalf
and on behalf
of Park Granada, Park Monaco and Park Sienna) shall have five (5)
Business Days
to cure such failure to deliver. At the end of such thirty (30) day
period the
Trustee shall send a Delay Delivery Certification for the Delay
Delivery
Mortgage Loans delivered during such thirty (30) day period in
accordance with
the provisions of Section 2.02.
Notwithstanding anything to the contrary in this Agreement,
within
twenty (20) days after a Supplemental Transfer Date with respect to
all of the
Supplemental Mortgage Loans sold to the Depositor on such
Supplemental Transfer
Date, 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) (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
II-4
<PAGE>
such Section 2.03); provided, however, that if Countrywide fails to
deliver a
Mortgage File for any Delay Delivery Mortgage Loan within the
twenty (20) day
period provided in the prior sentence, Countrywide (on its own
behalf and on
behalf of Park Granada, Park Monaco and Park Sienna) shall use its
best
reasonable efforts to effect a substitution, rather than a
repurchase of, such
Deleted Mortgage Loan and provided further that the cure period
provided for in
Section 2.02 or in Section 2.03 shall not apply to the initial
delivery of the
Mortgage File for such Delay Delivery Mortgage Loan, but rather
Countrywide (on
its own behalf and on behalf of Park Granada, Park Monaco and Park
Sienna) shall
have five (5) Business Days to cure such failure to deliver. At the
end of such
twenty (20) day period the Trustee shall send a Delay Delivery
Certification for
the Delay Delivery Mortgage Loans delivered during such twenty (20)
day period
in accordance with the provisions of Section 2.02.
(d) Subject to the execution and delivery of the related
Supplemental Transfer Agreement as provided in Section 2.01(e)
hereof and the
terms and conditions of this Agreement, each Seller sells,
transfers, assigns,
sets over and otherwise conveys to the Depositor, without recourse,
on each
Supplemental Transfer Date, with respect to each Supplemental
Mortgage Loan sold
by such Seller to the Depositor, all the right, title and interest
of that
Seller in and to the Supplemental Mortgage Loans sold by it
identified in such
Supplemental Transfer Agreement, including all interest and
principal received
and receivable by such Seller on or with respect to the related
Supplemental
Mortgage Loans on and after the related Supplemental Cut-off Date
(to the extent
not applied in computing the Cut-off Date Principal Balance
thereof) or
deposited into the Certificate Account by the related Seller, other
than
principal and interest due on such Supplemental Mortgage Loans
prior to the
related Supplemental Cut-off Date.
Immediately upon the conveyance of the Supplemental Mortgage
Loans
referred to in the preceding paragraph, the Depositor sells,
transfers, assigns,
sets over and otherwise conveys to the Trustee for benefit of
the
Certificateholders, without recourse, all right title and interest
in all of the
Supplemental Mortgage Loans.
Each Seller has entered into this Agreement in consideration for
the
purchase of the Mortgage Loans sold by such Seller to the Depositor
and has
agreed to take the actions specified herein. The Depositor,
concurrently with
the execution and delivery of this Agreement, hereby sells,
transfers, assigns
and otherwise conveys to the Trustee for the use and benefit of
the
Certificateholders, without recourse, all right title and interest
in the
portion of the Trust Fund not otherwise conveyed to the Trust Fund
pursuant to
Sections 2.01(a) or (b).
(e) Upon five (5) Business Days written notice to the Trustee,
the
Depositor, the Master Servicer (if the Master Servicer is not a
Seller) and the
Rating Agencies, on any other Business Day during the Funding
Period designated
by Countrywide, Park Granada, Park Monaco and Park Sienna, if
applicable, the
Depositor and the Trustee shall complete, execute and deliver a
Supplemental
Transfer Agreement so long as no Rating Agency has provided notice
that the
execution and delivery of such Supplemental Transfer Agreement will
result in a
reduction or withdrawal of the any ratings assigned to the
Certificates. After
the execution and delivery of such Supplemental Transfer Agreement,
on the
Supplemental Transfer Date, the Trustee shall set aside in the
Pre-funding
Account an amount equal to the Aggregate Supplemental Purchase
Amount.
The transfer of Supplemental Mortgage Loans and the other
property
and rights relating to them on a Supplemental Transfer Date is
subject to the
satisfaction of each of the following conditions:
(i) each Supplemental Mortgage Loan conveyed on such
Supplemental Transfer Date satisfies the representations and
warranties
applicable to it under this Agreement; provided, however, that with
respect
to a
breach of a representation and warranty with respect to a
Supplemental
Mortgage Loan, the obligation under Section 2.03(c) of this
Agreement of
II-5
<PAGE>
Countrywide, Park Granada, Park Monaco and Park Sienna, if
applicable, to
cure, repurchase or replace such Supplemental Mortgage Loan
shall
constitute the sole remedy against such Seller respecting such
breach
available to Certificateholders, the Depositor or the Trustee;
(ii) the Trustee, the Underwriters and the Rating Agencies are
provided with an Opinion of Counsel or Opinions of Counsel with
respect to
the
tax treatment of the Trust Fund, to be delivered as provided
pursuant
to
Section 2.01(f);
(iii) the Rating Agencies and the Underwriters are provided
with
an
Opinion of Counsel or Opinions of Counsel with respect to the
validity
of
the conveyance of the Supplemental Mortgage Loans conveyed on
such
Supplemental Transfer Date, to be delivered as provided pursuant to
Section
2.01(f);
(iv) the execution and delivery of such Supplemental Transfer
Agreement or conveyance of the related Supplemental Mortgage Loans
does not
result in a reduction or withdrawal of any ratings assigned to
the
Certificates by the Rating Agencies;
(v) the Supplemental Mortgage Loans conveyed on such
Supplemental Transfer Date were selected in a manner reasonably
believed
not
to be adverse to the interests of the Certificateholders;
(vi) no Supplemental Mortgage Loan conveyed on such
Supplemental
Transfer date was 30 or more days delinquent;
(vii) the aggregate of the PO Percentages of the Stated
Principal Balance of all Supplemental Mortgage Loans in Loan Group
1 shall
not
exceed the applicable PO Sublimit;
(viii) following the conveyance of the Supplemental Mortgage
Loans on such Supplemental Transfer Date to the Trust Fund, the
characteristics of the Mortgage Loans will comply with the Pool
Characteristics (including the permitted variances listed
therein);
provided, that for the purpose of making these calculations,
the
characteristics for any Initial Mortgage Loan made will be taken as
of the
Initial Cut-off Date and the characteristics for any Supplemental
Mortgage
Loan
will be taken as of the related Supplemental Cut-off Date;
(ix) none of the Sellers or the Depositor shall be insolvent or
shall be rendered insolvent as a result of such transfer; and
(x) the Depositor
shall have delivered to the Trustee an
Officer's Certificate confirming the satisfaction of each of
these
conditions precedent.
The Trustee shall not be required to investigate or otherwise
verify
compliance with these conditions, except for its own receipt of
documents
specified above, and shall be entitled to rely on the required
Officer's
Certificate.
(f) Within seven Business Days after each Supplemental Transfer
Date, upon (1) delivery to the Trustee by the Depositor or
Countrywide of the
Opinions of Counsel referred to in Sections 2.01(e)(ii) and (iii),
(2) delivery
to the Trustee by Countrywide of a revised Mortgage Loan Schedule
reflecting the
Supplemental Mortgage Loans conveyed on such Supplemental Transfer
Date to the
Loan Group into which each Supplement Mortgage Loan was conveyed
and (3)
delivery to the Trustee by the Depositor of an Officer's
Certificate confirming
the satisfaction of each of the conditions precedent set forth in
this Section
2.01(f), the Trustee shall pay to each Seller the Aggregate
Supplemental
II-6
<PAGE>
Transfer Amount for Loan Group 1 used to purchase Supplemental
Mortgage Loans
for Loan Group 1 from such Seller from those funds that were set
aside in the
Pre-funding Account pursuant to Section 2.01(e). The positive
difference, if
any, between the Aggregate Supplemental Transfer Amount for Loan
Group 1 and the
Aggregate Supplemental Purchase Amount for Loan Group 1 shall be
reinvested by
the Trustee in the Pre-funding Account and shall remain designated
as a portion
of the Pre-funded Amount allocated to that Loan Group.
(g) The Trustee shall not be required to investigate or
otherwise
verify compliance with the conditions set forth in the preceding
paragraph,
except for its own receipt of documents specified above, and shall
be entitled
to rely on the required Officer's Certificate.
Within thirty days after the final Supplemental Transfer Date,
the
Depositor shall deliver to the Trustee a letter of a nationally
recognized firm
of independent public accountants stating whether or not the
Supplemental
Mortgage Loans conveyed on such Supplemental Transfer Date conform
to the
characteristics in Section 2.01(e)(vi), (vii) and (viii) for that
Loan Group.
(h) Neither the Depositor nor the Trust will acquire or hold
any
Mortgage Loan that would violate the representations made by
Countrywide set
forth in clause (46) 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
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 hereto 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 such
Initial Mortgage Loan. The Trustee shall be under no duty or
obligation to
inspect, review or examine said documents, instruments,
certificates or other
papers to determine that the same are genuine, enforceable or
appropriate for
the represented purpose or that they have actually been recorded in
the real
estate records or that they are other than what they purport to be
on their
face.
On or about the thirtieth (30th) day after the Closing Date,
the
Trustee shall deliver to the Depositor, the Master Servicer and
Countrywide (on
its own behalf and on behalf of Park Granada, Park Monaco and Park
Sienna) a
Delay Delivery Certification with respect to the Initial Mortgage
Loans in the
form annexed hereto as Exhibit G-1, with any applicable exceptions
noted
thereon.
Not later than 90 days after the Closing Date, the Trustee
shall
deliver to the Depositor, the Master Servicer and Countrywide (on
its own behalf
and on behalf of Park Granada, Park Monaco and Park Sienna) a
Final
Certification with respect to the Initial Mortgage Loans in the
form annexed
hereto as Exhibit H-1, 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 which does not meet the requirements of Section 2.01,
the Trustee
shall list such as an exception in the Final Certification;
provided, however
that the Trustee shall not make any determination as to whether (i)
any
endorsement is sufficient to transfer all right, title and interest
of the party
so endorsing, as noteholder or assignee thereof, in and to that
II-7
<PAGE>
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) which has not been returned by the appropriate
recording
office or (b) as to which there is a dispute as to location or
status of such
Mortgage Loan. Such notice shall be delivered every 90 days
thereafter until the
related Mortgage Loan is returned to the Trustee. Any such
substitution pursuant
to (a) above or purchase pursuant to (b) above shall not be
effected prior to
the delivery to the Trustee of the Opinion of Counsel required by
Section 2.05
hereof, if any, and any substitution pursuant to (a) above shall
not be effected
prior to the additional delivery to the Trustee of a Request for
Release
substantially in the form of Exhibit N. No substitution is
permitted to be made
in any calendar month after the Determination Date for such month.
The Purchase
Price for any such Mortgage Loan shall be deposited by Countrywide
(on its own
behalf and on behalf of Park Granada, Park Monaco and Park Sienna)
in the
Certificate Account on or prior to the Distribution Account Deposit
Date for the
Distribution Date in the month following the month of repurchase
and, upon
receipt of such deposit and certification with respect thereto in
the form of
Exhibit N hereto, the Trustee shall release the related Mortgage
File to
Countrywide (on its own behalf and on behalf of Park Granada, Park
Monaco and
Park Sienna) and shall execute and deliver at Countrywide's (on its
own behalf
and on behalf of Park Granada, Park Monaco and Park Sienna) request
such
instruments of transfer or assignment prepared by Countrywide, in
each case
without recourse, as shall be necessary to vest in Countrywide (on
its own
behalf and on behalf of Park Granada, Park Monaco and Park Sienna),
or its
designee, the Trustee's interest in any Mortgage Loan released
pursuant hereto.
If pursuant to the foregoing provisions Countrywide (on its own
behalf and on
behalf of Park Granada, Park Monaco and Park Sienna) repurchases an
Mortgage
Loan that is a MERS Mortgage Loan, the Master Servicer shall either
(i) cause
MERS to execute and deliver an assignment of the Mortgage in
recordable form to
transfer the Mortgage from MERS to Countrywide (on its own behalf
and on behalf
of Park Granada, Park Monaco and Park Sienna) or its designee and
shall cause
such Mortgage to be removed from registration on the MERS(R) System
in
accordance with MERS' rules and regulations or (ii) cause MERS to
designate on
the MERS(R) System Countrywide (on its own behalf and on behalf of
Park Granada,
Park Monaco and Park Sienna) or its designee as the beneficial
holder of such
Mortgage Loan.
(b) Upon delivery of the Supplemental Mortgage Loans pursuant to
a
Supplemental Transfer Agreement, the Trustee shall acknowledge
receipt of the
documents identified in any Supplemental Certification in the form
annexed
hereto as Exhibit F-2 and declare that it will hold such documents
and the other
documents delivered to it constituting the Mortgage Files, and that
it will hold
such other assets as are included in the Trust Fund, in trust for
the exclusive
use and benefit of all present and future Certificateholders. The
Trustee
acknowledges that it will maintain possession of the Mortgage Notes
in the State
of California, unless otherwise permitted by the Rating
Agencies.
II-8
<PAGE>
The Trustee agrees to execute and deliver on the Supplemental
Transfer Date to the Depositor, the Master Servicer and Countrywide
(on its own
behalf and on behalf of Park Granada, Park Monaco and Park Sienna)
a
Supplemental Certification in the form annexed hereto as Exhibit
F-2. Based on
its review and examination, and only as to the documents identified
in such
Supplemental Certification, the Trustee shall acknowledge that such
documents
appear regular on their face and relate to such Supplemental
Mortgage Loan. The
Trustee shall be under no duty or obligation to inspect, review or
examine said
documents, instruments, certificates or other papers to determine
that the same
are genuine, enforceable or appropriate for the represented purpose
or that they
have actually been recorded in the real estate records or that they
are other
than what they purport to be on their face.
On or about the twentieth (20th) day after the Supplemental
Transfer
Date, the Trustee shall deliver to the Depositor, the Master
Servicer and
Countrywide (on its own behalf and on behalf of Park Granada, Park
Monaco and
Park Sienna) a Delay Delivery Certification with respect to the
Supplemental
Mortgage Loans in the form annexed hereto as Exhibit G-2, with any
applicable
exceptions noted thereon.
Not later than 90 days after the final Supplemental Transfer
Date,
the Trustee shall deliver to the Depositor, the Master Servicer and
Countrywide
(on its own behalf and on behalf of Park Granada, Park Monaco and
Park Sienna) a
Final Certification with respect to the Supplemental Mortgage Loans
in the form
annexed hereto as Exhibit H-2, with any applicable exceptions noted
thereon.
(c) If, in the course of such review of the Mortgage Files
relating
to the Supplemental Mortgage Loans, the Trustee finds any document
constituting
a part of a Mortgage File which does not meet the requirements of
Section 2.01,
the Trustee shall list such as an exception in the Final
Certification;
provided, however that the Trustee shall not make any determination
as to
whether (i) any endorsement is sufficient to transfer all right,
title and
interest of the party so endorsing, as noteholder or assignee
thereof, in and to
that Mortgage Note or (ii) any assignment is in recordable form or
is sufficient
to effect the assignment of and transfer to the assignee thereof
under the
mortgage to which the assignment relates. Countrywide (on its own
behalf and on
behalf of Park Granada, Park Monaco and Park Sienna) shall promptly
correct or
cure such defect within 90 days from the date it was so notified of
such defect
and, if Countrywide does not correct or cure such defect within
such period,
Countrywide (on its own behalf and on 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) which has not
been returned
by the appropriate recording office or (b) as to which there is a
dispute as to
location or status of such Mortgage Loan. Such notice shall be
delivered every
90 days thereafter until the related Mortgage Loan is returned to
the Trustee.
Any such substitution pursuant to (a) above or purchase pursuant to
(b) above
shall not be effected prior to the delivery to the Trustee of the
Opinion of
Counsel required by Section 2.05 hereof, if any, and any
substitution pursuant
to (a) above shall not be effected prior to the additional delivery
to the
Trustee of a Request for Release substantially in the form of
Exhibit N. No
substitution is permitted to be made in any calendar month after
the
Determination Date for such month. The Purchase Price for any such
Mortgage
II-9
<PAGE>
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 a designee, the Trustee's interest in
any Mortgage
Loan released pursuant hereto. If pursuant to the foregoing
provisions
Countrywide (on its own behalf and on behalf of Park Granada, Park
Monaco and
Park Sienna) repurchases a Supplemental Mortgage Loan that is a
MERS Mortgage
Loan, the Master Servicer shall either (i) cause MERS to execute
and deliver an
assignment of the Mortgage in recordable form to transfer the
Mortgage from MERS
to Countrywide (on its own behalf and on behalf of Park Granada,
Park Monaco and
Park Sienna) and shall cause such Mortgage to be removed from
registration on
the MERS(R) System in accordance with MERS' rules and regulations
or (ii) cause
MERS to designate on the MERS(R) System Countrywide (on its own
behalf and on
behalf of Park Granada, Park Monaco and Park Sienna) or its
designee as the
beneficial holder of such Mortgage Loan.
(d) The Trustee shall retain possession and custody of each
Mortgage
File in accordance with and subject to the terms and conditions set
forth
herein. 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.
(f) 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 (46) of Schedule III-A hereto.
SECTION 2.03. Representations, Warranties and Covenants of the
Sellers and Master Servicer.
(a) Countrywide hereby makes the representations and warranties
set
forth in (i) Schedule II-A, Schedule II-B, Schedule II-C and
Schedule II-D
hereto, and by this reference incorporated herein, to the
Depositor, the Master
Servicer and the Trustee, as of the Closing Date, (ii) Schedule
III-A hereto,
and by this reference incorporated herein, to the Depositor, the
Master Servicer
and the Trustee, as of the Closing Date, or if so specified
therein, as of the
Initial Cut-off Date with respect to all of the Initial Mortgage
Loans and as of
the related Supplemental Cut-off Date with respect to all of the
Supplemental
Mortgage Loans, and (iii) Schedule III-B hereto, and by this
reference
incorporated herein, to the Depositor, the Master Servicer and the
Trustee, as
of the Closing Date, or if so specified therein, as of the Initial
Cut-off Date
with respect to the Initial Mortgage Loans that are Countrywide
Mortgage Loans
and as of the related Supplemental Cut-off Date with respect to the
Supplemental
Mortgage Loans that are Countrywide Mortgage Loans. Park Granada
hereby makes
the representations and warranties set forth in (i) Schedule II-B
hereto, and by
this reference incorporated herein, to the Depositor, the Master
Servicer and
the Trustee, as of the Closing Date and (ii) Schedule III-C hereto,
and by this
reference incorporated herein, to the Depositor, the Master
Servicer and the
Trustee, as of the Closing Date, or if so specified therein, as of
the Initial
Cut-off Date with respect to the Initial
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Mortgage Loans that are Park Granada Mortgage Loans and as of the
related
Supplemental Cut-off Date with respect to the Supplemental Mortgage
Loans that
are Park Granada Mortgage Loans. Park Monaco hereby makes the
representations
and warranties set forth in (i) Schedule II-C hereto, and by this
reference
incorporated herein, to the Depositor, the Master Servicer and the
Trustee, as
of the Closing Date and (ii) Schedule III-D hereto, and by this
reference
incorporated herein, to the Depositor, the Master Servicer and the
Trustee, as
of the Closing Date, or if so specified therein, as of the Initial
Cut-off Date
with respect to the Initial Mortgage Loans that are Park Monaco
Mortgage Loans
and as of the related Supplemental Cut-off Date with respect to the
Supplemental
Mortgage Loans that are Park Monaco Mortgage Loans. Park Sienna
hereby makes the
representations and warranties set forth in (i) Schedule II-D
hereto, and by
this reference incorporated herein, to the Depositor, the Master
Servicer and
the Trustee, as of the Closing Date and (ii) Schedule III-E hereto,
and by this
reference incorporated herein, to the Depositor, the Master
Servicer and the
Trustee, as of the Closing Date, or if so specified therein, as of
the Initial
Cut-off Date with respect to the Initial Mortgage Loans that are
Park Sienna
Mortgage Loans and as of the related Supplemental Cut-off Date with
respect to
the Supplemental Mortgage Loans that are Park Sienna Mortgage
Loans.
(b) The Master Servicer hereby makes the representations and
warranties set forth in Schedule IV hereto, and by this reference
incorporated
herein, to the Depositor and the Trustee, as of the Closing
Date.
(c) Upon discovery by any of the parties hereto of a breach of
a
representation or warranty with respect to a Mortgage Loan made
pursuant to
Section 2.03(a) or a breach of a representation or warranty with
respect to a
Supplemental Mortgage Loan under Section 2.01(e)(i) that materially
and
adversely affects the interests of the Certificateholders in that
Mortgage Loan,
the party discovering such breach shall give prompt notice thereof
to the other
parties. Each Seller hereby covenants that within 90 days of the
earlier of its
discovery or its receipt of written notice from any party of a
breach of any
representation or warranty with respect to a Mortgage Loan sold by
it pursuant
to Section 2.03(a) and with respect to a breach of a representation
and warranty
with respect to a Supplemental Mortgage Loan sold by it under
Section 2.01(e)(i)
which 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 hereof, 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
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<PAGE>
deliver to the Trustee for the benefit of the Certificateholders
the Mortgage
Note, the Mortgage, the related assignment of the Mortgage, and
such other
documents and agreements as are required by Section 2.01, with the
Mortgage Note
endorsed and the Mortgage assigned as required by Section 2.01. No
substitution
is permitted to be made in any calendar month after the
Determination Date for
such month. Scheduled Payments due with respect to Substitute
Mortgage Loans in
the month of substitution shall not be part of the Trust Fund and
will be
retained by the related Seller on the next succeeding Distribution
Date. For the
month of substitution, distributions to Certificateholders will
include the
monthly payment due on any Deleted Mortgage Loan for such month and
thereafter
that Seller shall be entitled to retain all amounts received in
respect of such
Deleted Mortgage Loan. The Master Servicer shall amend the Mortgage
Loan
Schedule for the benefit of the Certificateholders to reflect the
removal of
such Deleted Mortgage Loan and the substitution of the Substitute
Mortgage Loan
or Loans and the Master Servicer shall deliver the amended Mortgage
Loan
Schedule to the Trustee. Upon such substitution, the Substitute
Mortgage Loan or
Loans shall be subject to the terms of this Agreement in all
respects, and the
related Seller shall be deemed to have made with respect to such
Substitute
Mortgage Loan or Loans, as of the date of substitution, the
representations and
warranties made pursuant to Section 2.03(a) with respect to such
Mortgage Loan.
Upon any such substitution and the deposit to the Certificate
Account of the
amount required to be deposited therein in connection with such
substitution as
described in the following paragraph, the Trustee shall release the
Mortgage
File held for the benefit of the Certificateholders relating to
such Deleted
Mortgage Loan to the related Seller and shall execute and deliver
at such
Seller's direction such instruments of transfer or assignment
prepared by
Countrywide (on its own behalf and on behalf of Park Granada, Park
Monaco and
Park Sienna), in each case without recourse, as shall be necessary
to vest title
in that Seller, or its designee, the Trustee's interest in any
Deleted Mortgage
Loan substituted for pursuant to this Section 2.03.
For any month in which a Seller substitutes one or more
Substitute
Mortgage Loans for one or more Deleted Mortgage Loans, the Master
Servicer will
determine the amount (if any) by which the aggregate principal
balance of all
Substitute Mortgage Loans sold to the Depositor by that Seller as
of the date of
substitution is less than the aggregate Stated Principal Balance of
all Deleted
Mortgage Loans repurchased by that Seller (after application of the
scheduled
principal portion of the monthly payments due in the month of
substitution). The
amount of such shortage (the "Substitution Adjustment Amount") plus
an amount
equal to the aggregate of any unreimbursed Advances with respect to
such Deleted
Mortgage Loans shall be deposited in the Certificate Account by
Countrywide (on
its own behalf and on behalf of Park Granada, Park Monaco and Park
Sienna) on or
before the Distribution Account Deposit Date for the Distribution
Date in the
month succeeding the calendar month during which the related
Mortgage Loan
became required to be purchased or replaced hereunder.
In the event that a Seller shall have repurchased a Mortgage
Loan,
the Purchase Price therefor shall be deposited in the Certificate
Account
pursuant to Section 3.05 on or before the 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.
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<PAGE>
The representations and warranties made pursuant to this
Section
2.03 shall survive delivery of the respective Mortgage Files to the
Trustee for
the benefit of the Certificateholders.
SECTION 2.04. Representations and Warranties of the Depositor as
to
the Mortgage Loans.
The Depositor hereby represents and warrants to the Trustee
with
respect to each Initial Mortgage Loan as of the date hereof or such
other date
set forth herein that as of the Closing Date, and following the
transfer of the
Initial Mortgage Loans to it by each Seller, the Depositor had good
title to the
Initial 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)(ii) hereof, together with all rights of the
Depositor to require
each 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.
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 hereunder 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. 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
hereto in the
same manner, and on the same terms and conditions, as it would a
Mortgage Loan
repurchased for breach of a representation or warranty contained in
Section
2.03.
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<PAGE>
SECTION 2.06. Execution and Delivery of Certificates.
The Trustee acknowledges the transfer and assignment to it of
the
Trust Fund and, concurrently with such transfer and assignment, has
executed and
delivered to or upon the order of the Depositor, the Certificates
in authorized
denominations evidencing directly or indirectly the entire
ownership of the
Trust Fund. The Trustee agrees to hold the Trust Fund and exercise
the rights
referred to above for the benefit of all present and future Holders
of the
Certificates and to perform the duties set forth in this Agreement,
to the end
that the interests of the Holders of the Certificates may be
adequately and
effectively protected.
SECTION 2.07. REMIC Matters.
The Preliminary Statement sets forth the designations and
"latest
possible maturity date" for federal income tax purposes of all
interests created
hereby. The "Startup Day" for purposes of the REMIC Provisions
shall be the
Closing Date. The "tax matters person" with respect to each REMIC
hereunder
shall be the Trustee and the Trustee shall hold the Tax Matters
Person
Certificate. Each REMIC's fiscal year shall be the calendar
year.
SECTION 2.08. Covenants of the Master Servicer.
The Master Servicer hereby covenants to the Depositor and the
Trustee as follows:
(a) the Master Servicer shall comply in the performance of its
obligations under this Agreement with all reasonable rules and
requirements of
the insurer under each Required Insurance Policy; and
(b) no written information, certificate of an officer,
statement
furnished in writing or written report delivered to the Depositor,
any affiliate
of the Depositor or the Trustee and prepared by the Master Servicer
pursuant to
this Agreement will contain any untrue statement of a material fact
or omit to
state a material fact necessary to make such information,
certificate, statement
or report not misleading.
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<PAGE>
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 hereof, subject to the
terms hereof (i)
to execute and deliver, on behalf of the Certificateholders and the
Trustee,
customary consents or waivers and other instruments and documents,
(ii) to
consent to transfers of any Mortgaged Property 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, 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 hereunder 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.
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
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<PAGE>
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
hereunder.
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 and the Trustee in Respect
of
the Master Servicer.
The Depositor may, but is not obligated to, enforce the
obligations
of the Master Servicer hereunder and may, but is not obligated to,
perform, or
cause a designee to perform, any defaulted obligation of the Master
Servicer
hereunder and in connection with any such defaulted obligation to
exercise the
related rights of the Master Servicer hereunder; provided that the
Master
Servicer shall not be relieved of any of its obligations hereunder
by virtue of
such performance by the Depositor or its designee. Neither the
Trustee nor the
Depositor shall have any responsibility or liability for any action
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
hereunder 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 hereunder (including by reason of an Event
of Default or
termination by the Depositor), the Trustee or its successor shall
thereupon
assume all of the rights and obligations of the Master Servicer
hereunder
arising thereafter (except that the Trustee shall not be (i) liable
for losses
of the Master Servicer pursuant to Section 3.09 hereof or any acts
or omissions
of the predecessor Master Servicer hereunder), (ii) obligated to
make Advances
if it is prohibited from doing so by applicable law, (iii)
obligated to
effectuate repurchases or substitutions of Mortgage Loans hereunder
including,
but not limited to, repurchases or substitutions of Mortgage Loans
pursuant to
Section 2.02 or 2.03 hereof, (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 hereunder). Any such
assumption shall be
subject to Section 7.02
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<PAGE>
hereof. 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, the
Certificate
Account the Distribution Account, the Supplemental
Interest Trust, the Corridor Contract Reserve Fund,
the Pre-funding Account and the Capitalized Interest
Account.
(a) The Master Servicer shall make reasonable efforts in
accordance
with the customary and usual standards of practice of prudent
mortgage servicers
to collect all payments called for under the terms and provisions
of the
Mortgage Loans to the extent such procedures shall be consistent
with this
Agreement and the terms and provisions of any related Required
Insurance Policy.
Consistent with the foregoing, the Master Servicer may in its
discretion (i)
waive any late payment charge or 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. 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 Fitch, 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
herein, 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
hereunder:
(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
Master Servicing Fee, Prepayment Interest Excess and any
lender-paid mortgage insurance premiums;
(iii) [Reserved];
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<PAGE>
(iv) all Insurance Proceeds, Subsequent Recoveries and
Liquidation
Proceeds,
other than proceeds to be applied to the restoration or repair
of the
Mortgaged Property or released to the Mortgagor in accordance
with
the Master
Servicer's normal servicing procedures;
(v) any amount required to be 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;
(vi) 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 hereof;
(vii) all Substitution Adjustment Amounts;
(viii) all Advances made by the Master Servicer pursuant to
Section
4.01;
and
(ix) any other amounts required to be deposited hereunder.
In addition, with respect to any Mortgage Loan that is subject to
a
buydown agreement, on each Due Date for such Mortgage Loan, in
addition to the
monthly payment remitted by the Mortgagor, the Master Servicer
shall cause funds
to be deposited into the Certificate Account in an amount required
to cause an
amount of interest to be paid with respect to such Mortgage Loan
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 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 Prepayment
Charges, 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 herein 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) [Reserved].
(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 therein 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
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(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 herein 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.
(e) Each institution at which the Certificate Account, the
Pre-funding Account, the Capitalized Interest 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 Pre-funding Account
or the
Capitalized Interest Account the second Business Day next preceding
the related
Distribution Account Deposit Date (except that if such Permitted
Investment is
an obligation of the institution that maintains such account, then
such
Permitted Investment shall mature not later than the Business Day
next preceding
such Distribution Account Deposit Date) and (ii) in the case of the
Distribution
Account, the Business Day next preceding the Distribution Date
(except that if
such Permitted Investment is an obligation of the institution that
maintains
such fund or account, then such Permitted Investment shall mature
not later than
such Distribution Date) and, in each case, shall not be sold or
disposed of
prior to its maturity. Each institution at which the Pre-funding
Account is
maintained shall invest the funds therein in Permitted Investments
that satisfy
the requirements of category (vi) of the definition thereof, which
do not
represent a direct issuance from the respective obligor and which
mature and
shall be reinvested daily. 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 herein. The amount of any realized losses in
the Certificate
Account or the Distribution Account incurred in any such account in
respect of
any such investments shall promptly be deposited by the Master
Servicer in the
Certificate Account or paid to the Trustee for deposit into the
Distribution
Account, as applicable. The amount of any losses in the Pre-funding
Account or
the Capitalized Interest Account incurred in respect of any such
investments
shall promptly be deposited by the Depositor in the Pre-funding
Account or the
Capitalized Interest Account, as applicable. All income or gain
(net of any
losses) realized from any such investment of funds on deposit in
the Capitalized
Interest Account shall be credited to the Capitalized Interest
Account. The
Trustee in its fiduciary capacity shall not be liable for the
amount of any loss
incurred in respect of any investment or lack of investment of
funds held in the
Certificate Account, the Pre-funding Account, the Capitalized
Interest 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, the Corridor Contract Reserve Fund, the Capitalized
Interest Account or
the Pre-funding Account prior to any change thereof.
(g) On the Closing Date, there is hereby established a separate
trust (the "Supplemental Interest Trust"), the assets of which
shall consist of
the Corridor Contract Reserve Fund and the Supplemental Interest
Trustee's
rights and obligations under the Corridor Contracts. The
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<PAGE>
Supplemental Interest Trust shall be maintained by the Supplemental
Interest
Trustee, who initially, shall be the Trustee.
On the Closing Date, the Supplemental Interest Trustee shall
establish and maintain in its name, in trust for the benefit of the
Holders of
the Covered Certificates, the Corridor Contract Reserve Fund, and
shall deposit
$1,000 therein upon receipt from or on behalf of the Depositor of
such amount.
All funds on deposit in the Corridor Contract Reserve Fund 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.
On each Distribution Date, the Supplemental Interest Trustee
shall
deposit into the Corridor Contract Reserve Fund all amounts
received in respect
of the Corridor Contracts for the related Interest Accrual Period.
The
Supplemental Interest Trustee shall make withdrawals from the
Corridor Contract
Reserve Fund to make distributions pursuant to Section 4.09
exclusively (other
than as expressly provided for in Section 3.08).
(h) The Trustee shall establish and maintain, on behalf of the
Certificateholders, the Pre-funding Account. On the Closing Date
Countrywide
shall remit the Pre-funded Amount to the Trustee for deposit in the
Pre-funding
Account. On each Supplemental Transfer Date, upon satisfaction of
the conditions
for such Supplemental Transfer Date set forth in Section 2.01(e),
with respect
to the related Supplemental Transfer Agreement, the Trustee shall
pay to each
Seller selling Supplemental Mortgage Loans to the Depositor on such
Supplemental
Transfer Date the portion of the Aggregate Supplemental Transfer
Amount held in
escrow pursuant to Section 2.01(e) as payment of the purchase price
for the
Supplemental Mortgage Loans sold by such Seller. If at any time the
Depositor
becomes aware that the Cut-off Date Stated Principal Balance of
Supplemental
Mortgage Loans reflected on any Supplemental Transfer Agreement
exceeds the
actual Cut-off Date Stated Principal Balance of the relevant
Supplemental
Mortgage Loans, the Depositor may so notify the Trustee and the
Trustee shall
redeposit into the Pre-funding Account the excess reported to it by
the
Depositor.
If any funds remain in the Pre-funding Account at the end of
the
Funding Period, to the extent that they represent earnings on the
amounts
originally deposited into the Pre-funding Account, the Trustee
shall distribute
them to the order of the Depositor. The remaining funds shall be
transferred to
the Distribution Account to be included as part of principal
distributions to
the Class 1-PO Certificates, to the extent of the Remaining PO
Pre-funded Amount
and to the other Classes of Group 1 Senior Certificates, to the
extent of the
Remaining Non-PO Pre-funded Amount, as applicable.
(i) The Trustee shall establish and maintain, on behalf of the
Certificateholders, the Capitalized Interest Account. On the
Closing Date,
Countrywide shall remit the aggregate Capitalized Interest
Requirement to the
Trustee for deposit in the Capitalized Interest Account. On each
Distribution
Account Deposit Date related to a Funding Period Distribution Date,
upon
satisfaction of the conditions for such Supplemental Transfer Date
set forth in
Section 2.01(e), with respect to the related Supplemental Transfer
Agreement and
Loan Group, the Trustee shall transfer from the Capitalized
Interest Account to
the Distribution Account an amount equal to the related Capitalized
Interest
Requirement (which, to the extent required, may include investment
earnings on
amounts on deposit therein) with respect to the related amount
remaining in the
Pre-funding Account for the related Distribution Date as identified
by
Countrywide in the Supplemental Transfer Agreement.
If any funds remain in the Capitalized Interest Account at the
end
of the Funding Period, the Trustee shall make the transfer
described in the
preceding paragraph if necessary for the remaining Funding Period
Distribution
Date and the Trustee shall distribute any remaining funds in the
Capitalized
Interest Account to the order of the Depositor.
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<PAGE>
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 herein 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 hereof (with respect to taxes and assessments and
insurance
premiums) and 3.09 hereof (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
hereof. 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 and
the
Trustee reasonable access to all records and documentation
regarding the
Mortgage Loans and all accounts, insurance information and other
matters
relating to this Agreement, such access being afforded without
charge, but only
upon reasonable request and during normal business hours at the
office
designated by the Master Servicer.
Upon reasonable advance notice in writing, the Master Servicer
will
provide to each Certificateholder and/or Certificate Owner which is
a savings
and loan association, bank or insurance company certain reports and
reasonable
access to information and documentation regarding the Mortgage
Loans sufficient
to permit such Certificateholder and/or Certificate Owner to comply
with
applicable regulations of the OTS or other regulatory authorities
with respect
to investment in the Certificates; provided that the Master
Servicer shall be
entitled to be reimbursed by each such Certificateholder and/or
Certificate
Owner for actual expenses incurred by the Master Servicer in
providing such
reports and access.
SECTION 3.08. Permitted Withdrawals from the Certificate
Account,
the Distribution Account and the Corridor Contract
Reserve Fund.
(a) The Master Servicer may from time to time make withdrawals
from
the Certificate Account for the following purposes:
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<PAGE>
(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) which 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 hereof;
(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 thereon after the date of
such
purchase;
(vii) to reimburse the Sellers, the Master Servicer or the
Depositor
for
expenses incurred by any of them and reimbursable pursuant to
Section
6.03
hereof;
(viii) to withdraw any amount deposited in the Certificate
Account
and not
required to be deposited therein;
(ix) on or prior to the Distribution Account Deposit Date, to
withdraw
an amount equal to the sum of (a) the related Available Funds
and
(b) 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 hereof.
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 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:
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<PAGE>
(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
