EXHIBIT 99.1
------------
The Pooling and Servicing Agreement
<PAGE>
Exhibit 99.1
EXECUTION COPY
========================
CWMBS, 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 January 1, 2007
-----------------------------------
CHL MORTGAGE PASS-THROUGH TRUST 2007-J1
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2007-J1
========================
<PAGE>
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<CAPTION>
Table of Contents
Page
----
ARTICLE I DEFINITIONS
<S>
<C>
SECTION 1.01. Defined
Terms..........................................................................I-1
SECTION 1.02. Certain Interpretive
Provisions.......................................................I-30
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-4
SECTION 2.03. Representations,
Warranties and Covenants of the Sellers and Master
Servicer..............................................................................II-6
SECTION 2.04. Representations and
Warranties of the Depositor as to the Mortgage
Loans.................................................................................II-8
SECTION 2.05. Delivery of Opinion of
Counsel in Connection with
Substitutions.......................II-9
SECTION 2.06. Execution and Delivery
of
Certificates................................................II-9
SECTION 2.07. REMIC
Matters.........................................................................II-9
SECTION 2.08. Covenants of the
Master
Servicer.....................................................II-10
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 and the Principal Reserve
Fund..................................III-3
SECTION 3.06. Collection of Taxes,
Assessments and Similar Items; Escrow
Accounts..................III-5
SECTION 3.07. Access to Certain
Documentation and Information Regarding the Mortgage
Loans................................................................................III-6
SECTION 3.08. Permitted Withdrawals
from the Certificate Account, the Distribution
Account and the Principal Reserve
Fund...............................................III-6
SECTION 3.09. Maintenance of Hazard
Insurance; Maintenance of Primary Insurance
Policies.............................................................................III-8
SECTION 3.10. Enforcement of
Due-on-Sale Clauses; Assumption
Agreements............................III-9
SECTION 3.11. Realization Upon
Defaulted Mortgage Loans; Repurchase of Certain
Mortgage
Loans......................................................................III-10
SECTION 3.12. Trustee to Cooperate;
Release of Mortgage
Files.....................................III-13
SECTION 3.13. Documents, Records and
Funds in Possession of Master Servicer to be
Held for the
Trustee................................................................III-14
SECTION 3.14. Servicing
Compensation..............................................................III-14
SECTION 3.15. Access to Certain
Documentation.....................................................III-14
SECTION 3.16. Annual Statement as to
Compliance...................................................III-15
SECTION 3.17. Errors and Omissions
Insurance; Fidelity
Bonds......................................III-16
SECTION 3.18.
[Reserved]..........................................................................III-16
SECTION 3.19. Prepayment
Charges..................................................................III-16
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-6
SECTION 4.04. Allocation of Realized
Losses.........................................................IV-6
SECTION 4.05.
Cross-Collateralization; Adjustments to Available
Funds...............................IV-6
SECTION 4.06. Monthly Statements to
Certificateholders..............................................IV-7
SECTION 4.07. Determination of
Pass-Through Rates for COFI
Certificates.............................IV-7
SECTION 4.08. Determination of
Pass-Through Rates for LIBOR
Certificates............................IV-8
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-5
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
ARTICLE IX TERMINATION
SECTION 9.01. Termination upon
Liquidation or Purchase of all Mortgage
Loans........................IX-1
ii
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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-3
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-5
SECTION 11.09.
Amendments............................................................................XI-5
SECTION 11.10.
Reconciliation of
Accounts............................................................XI-6
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: Form of Class P
Certificate..........................................................C-2-1
Exhibit C-3
[Reserved]...........................................................................C-3-1
Exhibit C-4
[Reserved]...........................................................................C-4-1
Exhibit C-5
[Reserved]...........................................................................C-5-1
Exhibit D: Form
of Notional Amount
Certificate....................................................D-1
Exhibit E: Form
of Reverse of
Certificates........................................................E-1
Exhibit F-1: Form of Initial
Certification of
Trustee.............................................F-1-1
Exhibit F-2:
[Reserved]...........................................................................F-2-1
Exhibit G-1: Form of Delay
Delivery Certification of
Trustee......................................G-1-2
Exhibit G-2:
[Reserved]...........................................................................G-2-1
Exhibit H-1: Form of Final
Certification of
Trustee...............................................H-1-1
Exhibit H-2:
[Reserved]...........................................................................H-2-1
Exhibit I: Form
of Transfer
Affidavit.............................................................I-1
Exhibit J-1: Form of
Transferor Certificate
(Residual)............................................J-1-1
Exhibit J-2: Form of
Transferor Certificate
(Private).............................................J-2-1
Exhibit K: Form
of Investment Letter [Non-Rule
144A]..............................................K-1
Exhibit L-1: Form of Rule
144A
Letter.............................................................L-1-1
Exhibit L-2:
[Reserved]...........................................................................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:
[Reserved].............................................................................P-1
Exhibit Q:
Standard & Poor's LEVELS(R) Version 5.7 Glossary Revised,
Appendix
E.............................................................................Q-1
iv
<PAGE>
Exhibit R:
[Reserved].............................................................................R-1
Exhibit S-1:
[Reserved]...........................................................................S-1-1
Exhibit S-2:
[Reserved]...........................................................................S-2-1
Exhibit T: Form
of Officer's Certificate with respect to
Prepayments..............................T-1
Exhibit U: Form
of Monthly
Statement..............................................................U-1
Exhibit V-1: Form of
Performance Certification
(Subservicer)......................................V-1-1
Exhibit V-2: Form of
Performance Certification
(Trustee)..........................................V-2-1
Exhibit W: Form
of Servicing Criteria to be Addressed in Assessment of Compliance
Statement..............................................................................W-1
Exhibit X: List
of Item 1119
Parties..............................................................X-1
Exhibit Y: Form
of Sarbanes-Oxley Certification (Replacement of Master
Servicer)..................Y-1
</TABLE>
v
<PAGE>
THIS POOLING AND SERVICING AGREEMENT, dated as of January 1,
2007,
among CWMBS, 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 will consist of a single real estate
mortgage
investment conduit (the "Master REMIC"). Each Certificate, other
than the
Class A-R Certificate, will represent ownership of one or more
regular
interests in the Master REMIC for purposes of the REMIC Provisions.
The Class
A-R Certificate will represent ownership of the sole class of
residual
interest in the Master REMIC. The Master REMIC will hold as assets
all
property of the Trust Fund. The latest possible maturity date of
all REMIC
regular interests created herein shall be the Latest Possible
Maturity Date.
<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
Integral Multiples
Initial Class
Rate
Minimum
in Excess of
Class
Designation
Certificate Balance
(per annum)
Denomination
Minimum
------------------------- ------------------------
--------------------- ----------------------
----------------------
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<C>
<C>
Class 1-A-1
$100,000,000.00
6.00%
$25,000
$1
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class 2-A-1
$198,149,000.00
6.00%
$25,000
$1
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class X
$283,665,920.00 (1)
(2)
$25,000(3)
$1(3)
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class PO
$1,052,583.00
(4)
$25,000
$1
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class A-R(5)
$100.00
6.00%
(6)
(6)
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class M
$6,256,000.00
6.00%
$25,000
$1
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class B-1
$2,500,000.00
6.00%
$25,000
$1
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class B-2
$1,719,000.00
6.00%
$25,000
$1
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class B-3
$1,094,000.00
6.00%
$100,000
$1
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class B-4
$781,500.00
6.00%
$100,000
$1
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class B-5
$937,657.18
6.00%
$100,000
$1
------------------------- ------------------------
--------------------- ----------------------
----------------------
Class P
$100.00 (6)
0.00% (6)
(6)
(6)
========================= ========================
===================== ======================
======================
</TABLE>
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(1) The Class X Certificates will be
Notional Amount Certificates, will
have no Class Certificate Balance and will bear interest on its
Notional Amount.
(2)
The Pass-Through Rate
for the Class X Certificates during the
Interest Accrual
Period for each Distribution Date will equal the
weighted average of the Pass-Through Rates of the Class X-1 and
the
Class X-2 Components, weighted on the basis of their respective
Component Notional Amounts immediately prior to such
Distribution
Date. The Pass-Through Rate for the Class X Certificates for
the
Interest Accrual Period for the first Distribution Date is
0.51691%
per annum.
(3)
Minimum denomination
is based on the Notional Amount of such Class.
(4)
The Class PO
Certificates will be Principal Only Certificates and
will not receive any distributions of interest.
(5)
The Class A-R
Certificates represent the sole Class of residual
interest in the Master
REMIC. 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.
(6)
The Class P
Certificates will also have a notional amount equal to
the aggregate Cut-off Date Principal Balance of the Mortgage
Loans
with a Prepayment Charge. The Class P Certificates are issuable
in
minimum notional amounts equal to a 20% Percentage Interest and
any
amount in excess thereof.
2
<PAGE>
Set
forth below are designations of Classes or Components of
Certificates
and other defined terms to the categories used herein:
<TABLE>
<CAPTION>
<S>
<C>
Accretion Directed Certificates........... None.
Accretion Directed Components............. None.
Accrual Certificates...................... None.
Accrual Components........................ None.
Book-Entry Certificates................... All Classes of Certificates other
than the Physical Certificates.
COFI Certificates......................... None.
Combined Certificates..................... None.
Component Certificates.................... Class X and 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 Component
Balance/ Initial
Component Notional
Designation
Amount
Pass-Through Rate
-----------
------
-----------------
Class X-1
$90,230,863 (1)
(2)
Class X-2
$193,435,057 (3)
(4)
Class PO-1
$468,433
(5)
Class PO-2
$584,150
(5)
(1) The Class X-1 Component is a notional amount component, will
have no
Component Principal Balance and will bear interest on its
Notional
Amount.
(2) The Pass-Through Rate for the Class X-1 Component for the
Interest
Accrual Period for any Distribution Date will equal 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 Balances 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 X-1 Component for the Interest
Accrual
Period for the first Distribution Date is 0.39052% per annum.
(3) The Class X-2 Component is a notional amount component, will
have no
Component Principal Balance and will bear interest on its
Notional
Amount.
(4) The Pass-Through Rate for the Class X-2 Component for the
Interest
Accrual Period for any Distribution Date will equal the excess of
(a) the
weighted average of
the Net Mortgage Rates of the Non-Discount Mortgage
3
<PAGE>
Loans in Loan Group 2, weighted on the basis of the Stated
Principal
Balances 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 X-2 Component for the Interest Accrual Period
for the
first Distribution Date is 0.57587% per annum.
(5) 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; 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................ None.
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 and Class A-R
Certificates and the Class X-1 and Class PO-1
Components.
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 Certificates and the
Class X-2 and Class PO-2 Components.
Inverse Floating Rate Certificates........ None.
LIBOR Certificates........................ None.
Non-Delay Certificates.................... LIBOR Certificates.
Notional Amount Certificates.............. Class X Certificates.
Notional Amount Components................ Class X-1 and Class X-2
Components.
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 PO Certificates.
Private Certificates...................... Class P, Class B-3, Class B-4 and
Class B-5 Certificates.
Rating Agencies........................... Fitch and S&P.
4
<PAGE>
Regular Certificates...................... All Classes of Certificates, other
than the Residual Certificates.
Residual Certificates..................... Class A-R Certificates.
Scheduled Principal Classes............... None.
Senior Certificates....................... Class 1-A-1, Class 2-A-1, Class X,
Class PO and Class A-R Certificates.
Subordinated Certificates................. Class M, Class B-1, Class B-2,
Class B-3, Class B-4 and Class B-5
Certificates.
Targeted Principal Classes................ None.
Underwriter............................... Countrywide Securities
Corporation.
</TABLE>
With respect to any of the foregoing designations as to which
the
corresponding reference is "None," all defined terms and provisions
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.
5
<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: Any Escrow Account, the Certificate Account, the
Distribution 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: Not applicable.
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).
Accrual Certificates: As specified in the Preliminary
Statement.
Accrual Components: As specified in the Preliminary Statement.
Accrual Termination Date: Not applicable.
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 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.
I-1
<PAGE>
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 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 each
Class X Component, (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, 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 any Loan Group, 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)(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
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<PAGE>
Mortgage Loan at the time of the origination thereof was 80% or
less and the
loan amount of the new mortgage loan is $650,000 or less, the value
of the
Mortgaged Property based upon the appraisal made at the time of
the
origination of the Original Mortgage Loan and (b) if the
loan-to-value ratio
with respect to the Original Mortgage Loan at the time of the
origination
thereof was greater than 80% or the loan amount of the new 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
each 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 Subordinated Portion 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, net of the Prepayment
Charges
received 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) - (iii), 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;
provided, however, that after a Senior Termination Date, Available
Funds with
respect to the Loan Group relating to the remaining Senior
Certificate Group
shall include the Available Funds from the other Loan Groups after
all
distributions are made on the Senior Certificates of the other
Senior
Certificate Group or Groups and on any Distribution Date
thereafter, Available
Funds shall be calculated based upon all the Mortgage Loans in the
Mortgage
Pool, as opposed to the Mortgage Loans in the related Loan Group.
The Holders
of the Class P Certificates will be entitled to all Prepayment
Charges
received on the Mortgage Loans and such amounts will not be
available for
distribution to the Holders of any other Class of Certificates.
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 equal to
0.00% per annum.
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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 CHL Mortgage Pass-Through Trust 2007-J1,
Mortgage
Pass-Through Certificates, Series 2007-J1."
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 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 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.
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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.
Interest
shall be calculated on the basis of a 360-day year consisting of
twelve 30-day
months.
Class P Principal Distribution Date: The first Distribution
Date
that occurs after the end of the latest Prepayment Charge Period
for all
Mortgage Loans that have a Prepayment Charge.
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
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 Certificates, 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: January 30, 2007.
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.
Combined Certificates: As specified in the Preliminary
Statement.
Combined Certificates Payment Rule: Not applicable.
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<PAGE>
Commission: The U.S. Securities and Exchange Commission.
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: With respect to any Distribution Date
and
the Class X-1 and Class X-2 Components, an amount equal to the
aggregate of
the Stated Principal Balances of the Non-Discount Mortgage Loans in
the
related Loan Group 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).
Coop Shares: Shares issued by a Cooperative Corporation.
Cooperative Corporation: The entity that holds title (fee or an
acceptable leasehold estate) to the real property and
improvements
constituting the Cooperative Property and which governs the
Cooperative
Property, which Cooperative Corporation must qualify as a
Cooperative Housing
Corporation under Section 216 of the Code.
Cooperative Loan: Any Mortgage Loan secured by Coop Shares and
a
Proprietary Lease.
Cooperative Property: The real property and improvements owned
by
the Cooperative Corporation, including the allocation of individual
dwelling
units to the holders of the Coop Shares of the Cooperative
Corporation.
Cooperative Unit: A single family dwelling located in a
Cooperative
Property.
Corporate Trust Office: The designated office of the Trustee in
the
State of New York at which at any particular time its corporate
trust business
with respect to this Agreement shall be administered, which office
at the date
of the execution of this Agreement is located at 101 Barclay
Street, 8W, New
York, New York 10286 (Attn: Mortgage-Backed Securities Group,
CWMBS, Inc.
Series 2007-J1), facsimile no. (212) 815-3986, and which is the
address to
which notices to and correspondence with the Trustee should be
directed.
Countrywide: Countrywide Home Loans, Inc., a New York
corporation,
and its successors and assigns in its capacity as the seller of
the
Countrywide Mortgage Loans to the Depositor.
Countrywide Mortgage Loans: The Mortgage Loans identified as such
on
the Mortgage Loan Schedule for which Countrywide is the applicable
Seller.
Covered Certificates: Not applicable.
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<PAGE>
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: With respect to any Mortgage Loan, the later of
(i)
the date of origination of such Mortgage Loan and (ii) January 1,
2007.
Cut-off Date Pool Principal Balance: $312,489,840.84.
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.
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. The number of Delay Delivery Mortgage Loans shall not
exceed 50%
of the aggregate number of Mortgage Loans in each Loan Group as of
the Closing
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: CWMBS, Inc., a Delaware corporation, or its successor
in
interest.
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<PAGE>
Depository: The initial Depository shall be The Depository
Trust
Company, the nominee of which is CEDE & Co., as the registered
Holder of the
Book-Entry Certificates. The Depository shall at all times be a
"clearing
corporation" as defined in Section 8-102(a)(5) of the Uniform
Commercial Code
of the State of New York.
Depository Participant: A broker, dealer, bank or other
financial
institution or other Person for whom from time to time a Depository
effects
book-entry transfers and pledges of securities deposited with the
Depository.
Determination Date: As to any Distribution Date, the 22nd day
of
each month or if such 22nd day is not a Business Day the next
preceding
Business Day; provided, however, that if such 22nd day or such
Business Day,
whichever is applicable, is less than two Business Days prior to
the related
Distribution Date, the Determination Date shall be the first
Business Day
which is two Business Days preceding such Distribution Date.
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 CHL Mortgage Pass-Through Trust
2007-J1,
Mortgage Pass-Through Certificates, Series 2007-J1." 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 February,
2007.
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
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<PAGE>
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.
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.
Exchange Fee: As defined in Section 5.02(e).
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
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<PAGE>
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.
Group 1 Senior Certificates: As specified in the Preliminary
Statement.
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.
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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<PAGE>
Item 1119 Party: The Depositor, any Seller, the Master Servicer,
the
Trustee, any Subservicer, any originator identified in the
Prospectus
Supplement 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.
LIBOR Certificates: As specified in the Preliminary Statement.
Limited Exchange Act Reporting Obligations: The obligations of
the
Master Servicer under Section 3.16(b), Section 6.02 and Section
6.04 with
respect to notice and information to be provided to the Depositor
and Article
XI (except Section 11.07(a)(1) and (2)).
Liquidated Mortgage Loan: With respect to any Distribution Date,
a
defaulted Mortgage Loan (including any REO Property) 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).
Loan-to-Value Ratio: With respect to any Mortgage Loan and as to
any
date of determination, the fraction (expressed as a percentage) the
numerator
of which is the principal balance of the related Mortgage Loan at
such date of
determination and the denominator of which is the Appraised Value
of the
related Mortgaged Property.
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<PAGE>
Lost Mortgage Note: Any Mortgage Note the original of which was
permanently lost or destroyed and has not been replaced.
Maintenance: With respect to any Cooperative Unit, the rent paid
by
the Mortgagor to the Cooperative Corporation pursuant to the
Proprietary
Lease.
Majority in Interest: As to any Class of Regular Certificates,
the
Holders of Certificates of such Class evidencing, in the aggregate,
at least
51% of the Percentage Interests evidenced by all Certificates of
such Class.
Master REMIC: As described in the Preliminary Statement.
Master Servicer: Countrywide Home Loans Servicing LP, a Texas
limited partnership, and its successors and assigns, in its
capacity as master
servicer hereunder.
Master Servicer Advance Date: As to any Distribution Date,
12:30
p.m. Pacific time on the Business Day immediately preceding such
Distribution
Date.
Master Servicing Fee: As to each Mortgage Loan and any
Distribution
Date, an amount payable out of each full payment of interest
received on such
Mortgage Loan and equal to one-twelfth of the Master Servicing Fee
Rate
multiplied by the Stated Principal Balance of such Mortgage Loan as
of the Due
Date in the month preceding the month of such Distribution Date,
subject to
reduction as provided in Section 3.14.
Master Servicing Fee Rate: With respect to each Mortgage Loan,
the
per annum rate set forth on the Mortgage Loan Schedule.
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.
MIN:
The Mortgage Identification Number for any MERS Mortgage Loan.
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.
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<PAGE>
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
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 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;
(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;
(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;
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<PAGE>
(xiv) the purpose for the Mortgage Loan;
(xv) the type of documentation program pursuant to which the
Mortgage Loan was originated;
(xvi) the direct servicer as of the Cut-off Date and the Master
Servicing Fee Rate; 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
and in the aggregate.
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.
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 the Prepayment
Interest
Shortfalls for such Loan Group for such Distribution Date exceeds
an amount
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 the Prepayment
Interest
Shortfalls experienced by the Mortgage Loans in the 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 that 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 the 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
such 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 a
Loan Group that became a Liquidated Mortgage Loan during the
calendar month
preceding the month of such Distribution Date, the amount of the
Liquidation
I-14
<PAGE>
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 such Loan Group received during
the related
Prepayment Period, and (ii) (A) any Subsequent Recoveries for such
Loan Group
received 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 any
such
Subsequent Recoveries received during the calendar month preceding
the month
of such Distribution Date.
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
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.
Notional Amount: With respect to any Distribution Date and the
Class
X Certificates, an amount equal to the aggregate Component Notional
Amount of
the Class X-1 and Class X-2 Components immediately prior to such
Distribution
Date.
Notional Amount Certificates: As specified in the Preliminary
Statement.
Offered Certificates: As specified in the Preliminary
Statement.
Officer's Certificate: A certificate (i) in the case of the
Depositor, signed by the Chairman of the Board, the Vice Chairman
of the
Board, the President, a Managing Director, a Vice President
(however
denominated), an Assistant Vice President, the Treasurer, the
Secretary, or
one of the Assistant Treasurers or Assistant Secretaries of the
Depositor,
(ii) in the case of the Master Servicer, signed by the President,
an Executive
Vice President, a Vice President, an Assistant Vice President, the
Treasurer,
or one of the Assistant Treasurers or Assistant Secretaries of
Countrywide GP,
Inc., its general partner (iii) if provided for in this Agreement,
signed by a
Servicing Officer, as the case may be, and delivered to the
Depositor and the
Trustee, as the case may be, as required by this Agreement or (iv)
in the case
of any other Person, signed by an authorized officer of such
Person.
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
I-15
<PAGE>
(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.
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................... 4.25%
Class B-1................. 2.25%
Class B-2................. 1.45%
Class B-3................. 0.90%
Class B-4................. 0.55%
Class B-5................. 0.30%
Original Mortgage Loan: The mortgage loan refinanced in
connection
with the n 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 Balance
of each Mortgage Loan in such Loan Group as of the Cut-off Date; or
if such
date is after a Senior Termination Date, the aggregate Class
Certificate
Balance 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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<PAGE>
Park Granada: Park Granada LLC, a Delaware limited liability
company, and its successors and assigns, in its capacity as the
seller of the
Park Granada Mortgage Loans to the Depositor.
Park Granada Mortgage Loans: The Mortgage Loans identified as
such
on the Mortgage Loan Schedule for which Park Granada is the
applicable Seller.
Park Monaco: Park Monaco Inc., a Delaware corporation, and its
successors and assigns, in its capacity as the seller of the Park
Monaco
Mortgage Loans to the Depositor.
Park Monaco Mortgage Loans: The Mortgage Loans identified as such
on
the Mortgage Loan Schedule for which Park Monaco is the applicable
Seller.
Park Sienna: Park Sienna LLC, a Delaware limited liability
company,
and its successors and assigns, in its capacity as the seller of
the Park
Sienna Mortgage Loans to the Depositor.
Park Sienna Mortgage Loans: The Mortgage Loans identified as such
on
the Mortgage Loan Schedule for which Park Sienna is the applicable
Seller.
Pass-Through 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-17
<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
any
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 the 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 the applicable Seller or
purchased
by the Master Servicer pursuant to this Agreement as of such
Distribution
Date, (c) the Substitution Adjustment Amount in connection with any
Deleted
Mortgage Loan in 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 the related Loan Group 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, and (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.
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%.
Pool Stated Principal Balance: As of any date of determination,
the
aggregate of the Stated Principal Balances of the Outstanding
Mortgage Loans.
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.
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<PAGE>
Prepayment Charge Amount: As to any Distribution Date, the sum
of
the Prepayment Charges collected on the Mortgage Loans during the
related
Prepayment Period and any amounts in respect of such Mortgage Loans
paid
pursuant to Section 3.19 for such Distribution Date.
Prepayment Charge Period: With respect to any Mortgage Loan,
the
period of time during which a Prepayment Charge may be imposed.
Prepayment 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 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 (a) by Countrywide Home
Loans Servicing
LP 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
January 1, 2007) and on or before the last day of the month
preceding the
month of such Distribution Date or (b) by any other servicer during
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 (i) with respect to any Mortgage Loan directly serviced by
Countrywide
Home Loans Servicing LP, the period from the 16th day of a calendar
month (or,
in the case of the first Distribution Date, from January 1, 2007)
through the
15th day of the following calendar month and (ii) with respect to
any other
Mortgage Loan, the calendar month immediately preceding the month
of that
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 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
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<PAGE>
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.
Principal Reserve Fund: A separate Eligible Account created and
maintained by the Trustee pursuant to Section 3.05(i) with a
depository
institution in the name of the Trustee for the benefit of the Class
P
Certificateholders specified in Section 3.05(j) and designated "The
Bank of
New York, Principal Reserve Fund in trust for registered holders of
CWMBS
2007-J1 CHL Mortgage Pass-Through Trust, Mortgage Pass-Through
Certificates,
Series 2007-J1, Class P".
Priority Amount: Not applicable.
Priority Percentage: Not applicable.
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 the mortgage pass-through certificates to be sold by
the
Depositor.
Prospectus Supplement: The Prospectus Supplement dated January
29,
2007 relating to the Offered Certificates.
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
I-21
<PAGE>
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. With respect
to each
Mortgage Loan which has become the subject of a Debt Service
Reduction and any
Distribution Date, the amount, if any, by which the principal
portion of the
related Scheduled Payment has been reduced.
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.
Record Date: As to any Distribution Date, 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.
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<PAGE>
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.
REMIC: A "real estate mortgage investment conduit" within the
meaning of section 860D of the Code.
REMIC Change of Law: Any proposed, temporary or final
regulation,
revenue ruling, revenue procedure or other official announcement
or
interpretation relating to REMICs and the REMIC Provisions issued
after the
Closing Date.
REMIC Provisions: Provisions of the federal income tax law
relating
to real estate mortgage investment conduits, which appear at
sections 860A
through 860G of Subchapter M of Chapter 1 of the Code, and related
provisions,
and regulations promulgated thereunder, as the foregoing may be in
effect from
time to time as well as provisions of applicable state laws.
REO Property: A Mortgaged Property acquired by the Trust Fund
through foreclosure or deed-in-lieu of foreclosure in connection
with a
defaulted Mortgage Loan.
Reportable Event: Any event required to be reported on Form 8-K
and,
in any event, the following:
(a)
entry into a definitive agreement related to the Trust Fund,
the
Certificates or the Mortgage Loans, or an amendment to a
Transaction
Document, even if the Depositor is not a party to such agreement
(e.g., a
servicing agreement with a servicer contemplated by Item 1108(a)(3)
of
Regulation AB);
(b)
termination of a Transaction Document (other than by expiration
of
the
agreement on its stated termination date or as a result of all
parties completing their obligations under such agreement), even if
the
Depositor is not a party to such agreement (e.g., a servicing
agreement
with
a servicer contemplated by Item 1108(a)(3) of Regulation AB);
(c)
with respect to the Master Servicer only, if the Master
Servicer
becomes aware of any bankruptcy or receivership with respect to
Countrywide, the Depositor, the Master Servicer, any Subservicer,
the
Trustee, 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
I-23
<PAGE>
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 each
Loan
Group, 6.00% per annum.
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: Not applicable.
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.
I-24
<PAGE>
Scheduled Principal Classes: As specified in the Preliminary
Statement.
Scheduled Principal Distribution Amount: As to any Distribution
Date
and Loan Group, an amount equal to the sum of 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.
Senior Percentage: As to any Senior Certificate Group and
Distribution Date, the percentage equivalent of a fraction, not in
excess of
100%, the numerator of which is the aggregate Class Certificate
Balance of the
Senior Certificates of such Senior Certificate Group (other than
the related
Class PO Component and Class X Component) 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 Class Certificate Balance of
the Senior
Certificates (other than the related Class PO Component and Class X
Component)
of such remaining Senior Certificate Group immediately prior to
such
Distribution Date and the denominator of which is the aggregate
Class
Certificate Balance 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.
I-25
<PAGE>
Senior Principal Distribution Amount: As to any Distribution
Date
and Senior Certificate Group, the sum of (i) the sum, not less than
zero, 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 each
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 such
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 (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 as of the first Distribution Date as to which any
decrease in the
Senior Prepayment Percentage applies: (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.
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<PAGE>
Servicing Criteria: The "servicing criteria" set forth in Item
1122(d) of Regulation AB.
Servicing Officer: Any officer of the Master Servicer involved
in,
or responsible for, the administration and servicing of the
Mortgage Loans
whose name and facsimile signature appear on a list of servicing
officers
furnished to the Trustee by the Master Servicer on the Closing Date
pursuant
to this Agreement, as such list may from time to time be
amended.
Shift Percentage: Not applicable.
SR-A R Interest: As specified in the Preliminary Statement.
Startup Day: The Closing Date.
Stated Principal Balance: As to any Mortgage Loan and Due Date,
the
unpaid principal balance of such Mortgage Loan as of such Due Date,
as
specified in the amortization schedule at the time relating thereto
(before
any adjustment to such amortization schedule by reason of any
moratorium or
similar waiver or grace period) minus the sum of: (i) any previous
partial
Principal Prepayments and the payment of principal due on such Due
Date,
irrespective of any delinquency in payment by the related
Mortgagor, (ii)
Liquidation Proceeds allocable to principal (other than with
respect to any
Liquidated Mortgage Loan) received in the prior calendar month and
Principal
Prepayments received through the last day of the related Prepayment
Period, in
each case with respect to that Mortgage Loan and (iii) any Realized
Loss
previously incurred in connection with a Deficient Valuation. The
Stated
Principal Balance of any Mortgage Loan that becomes a Liquidated
Mortgage Loan
will be zero on each date following the Due Period in which such
Mortgage Loan
becomes a Liquidated Mortgage Loan.
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.
Subcontractor: Any vendor, subcontractor or other Person that is
not
responsible for the overall servicing (as "servicing" is commonly
understood
by participants in the mortgage-backed securities market) of
Mortgage Loans
but performs one or more discrete functions identified in Item
1122(d) of
Regulation AB with respect to the Mortgage Loans under the
direction or
authority of the Master Servicer or a Subservicer or the Trustee,
as the case
may be.
Subordinated Certificates: As specified in the Preliminary
Statement.
Subordinated 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.
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<PAGE>
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 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 related
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 the
applicable Seller for a Deleted Mortgage Loan which must, on the
date of such
substitution, as confirmed in a Request for Release, substantially
in the form
of Exhibit M, (i) have a Stated Principal Balance, after deduction
of the
principal portion of the Scheduled Payment due in the month of
substitution,
not in excess of, and not more than 10% less than the Stated
Principal Balance
of the Deleted Mortgage Loan; (ii) be accruing interest at a rate
no lower
than and not more than 1% per annum higher than, that of the
Deleted Mortgage
Loan; (iii) have a Loan-to-Value Ratio no higher than that of the
Deleted
Mortgage Loan; (iv) have a remaining term to maturity no greater
than (and not
more than one year less than that of) the Deleted Mortgage Loan;
(v) 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.
I-28
<PAGE>
Substitution Adjustment Amount: The meaning ascribed to such
term
pursuant to Section 2.03.
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 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.
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 Pool Stated
Principal
Balance with respect to such Distribution Date.
Trustee Fee Rate: With respect to each Mortgage Loan, 0.009%
per
annum.
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 and the Principal Reserve Fund, and all
amounts deposited
therein pursuant to the applicable provisions of this Agreement;
(iii)
property that secured a Mortgage Loan and has been acquired by
foreclosure,
deed-in-lieu of foreclosure or otherwise; and (iv) all proceeds of
the
conversion, voluntary or involuntary, of any of the foregoing.
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.
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<PAGE>
Unscheduled Principal Distribution Amount: As 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, (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.
SECTION 1.02. Certain Interpretive Provisions.
All terms defined in this Agreement shall have the defined
meanings
when used in any certificate, agreement or other document delivered
pursuant
hereto unless otherwise defined therein. For purposes of this
Agreement and
all such certificates and other documents, unless the context
otherwise
requires: (a) accounting terms not otherwise defined in this
Agreement, and
accounting terms partly defined in this Agreement to the extent not
defined,
shall have the respective meanings given to them under generally
accepted
accounting principles; (b) the words "hereof," "herein" and
"hereunder" and
words of similar import refer to this Agreement (or the
certificate, agreement
or other document in which they are used) as a whole and not to any
particular
provision of this Agreement (or such certificate, agreement or
document); (c)
references to any Section, Schedule or Exhibit are references to
Sections,
Schedules and Exhibits in or to this Agreement, and references to
any
paragraph, subsection, clause or other subdivision within any
Section or
definition refer to such paragraph, subsection, clause or other
subdivision of
such Section or definition; (d) the term "including" means
"including without
limitation"; (e) references to any law or regulation refer to that
law or
regulation as amended from time to time and include any successor
law or
regulation; (f) references to any agreement refer to that agreement
as amended
from time to time; (g) references to any Person include that
Person's
permitted successors and assigns; and (h) a Mortgage Loan is "30
days
delinquent" if any Scheduled Payment has not been received by the
close of
business on the day immediately preceding the Due Date on which the
next
Scheduled Payment is due. Similarly for "60 days delinquent," "90
days
delinquent" and so on.
I-30
<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 Mortgage Loans, including all interest and
principal
received or receivable by such Seller, on or with respect to the
applicable
Mortgage Loans after the Cut-off Date and all interest and
principal payments
on the related Mortgage Loans received prior to the Cut-off Date in
respect of
installments of interest and principal due thereafter, but not
including
payments of principal and interest due and payable on such Mortgage
Loans, on
or before the Cut-off Date. On or prior to the Closing Date,
Countrywide shall
deliver to the Depositor or, at the Depositor's direction, to the
Trustee or
other designee of the Depositor, the Mortgage File for each
Mortgage Loan
listed in the Mortgage Loan Schedule (except that, in the case of
the Delay
Delivery Mortgage Loans (which may include Countrywide Mortgage
Loans, Park
Granada Mortgage Loans, Park Monaco Mortgage Loans and Park Sienna
Mortgage
Loans), such delivery may take place within thirty (30) days
following the
Closing Date). Such delivery of the Mortgage Files shall be made
against
payment by the Depositor of the purchase price, previously agreed
to by the
Sellers and Depositor, for the Mortgage Loans. With respect to any
Mortgage
Loan that does not have a first payment date on or before the Due
Date in the
month of the first Distribution 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 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, will
deliver or
cause to be delivered to the Trustee within thirty (30) days
following the
Closing Date) for the benefit of the Certificateholders the
following
documents or instruments with respect to each Mortgage Loan so
assigned:
(i)
(A) the original Mortgage Note endorsed by manual or facsimile
signature in blank in the following form: "Pay to the order of
____________ without recourse," with all intervening endorsements
showing
a
complete chain of endorsement from the originator to the Person
endorsing the Mortgage Note (each such endorsement being sufficient
to
transfer all right, title and interest of the 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-1
<PAGE>
(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 (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
(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).
II-2
<PAGE>
In addition, in connection with the assignment of any MERS
Mortgage
Loan, each Seller agrees that it will cause, at the Trustee's
expense, the
MERS(R) System to indicate that the Mortgage Loans sold by such
Seller to the
Depositor have been assigned by that Seller to the Trustee in
accordance with
this Agreement for the benefit of the Certificateholders by
including (or
deleting, in the case of Mortgage Loans which are repurchased in
accordance
with this Agreement) in such computer files the information
required by the
MERS(R) System to identify the series of the Certificates issued in
connection
with such Mortgage Loans. Each Seller further agrees that it will
not, and
will not permit the Master Servicer to, and the Master Servicer
agrees that it
will not, alter the information referenced in this paragraph with
respect to
any Mortgage Loan sold by such Seller to the Depositor during the
term of this
Agreement unless and until such Mortgage Loan is repurchased in
accordance
with the terms of this Agreement.
In the event that in connection with any Mortgage Loan that is not
a
MERS Mortgage Loan the Depositor cannot deliver (a) the original
recorded
Mortgage, or a copy of such Mortgage with recording information (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.
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: "CWMBS
Series
2007-J1, 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
II-3
<PAGE>
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, 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.
(d) Neither the Depositor nor the Trust will acquire or hold
any
Mortgage Loan that would violate the representations made by
Countrywide set
forth in clause (48) 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
II-4
<PAGE>
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 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 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 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 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
II-5
<PAGE>
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) [Reserved].
(c) 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.
(d) It is understood and agreed that the respective obligations
of
each Seller to substitute for or to purchase any Mortgage Loan sold
to the
Depositor by it which does not meet the requirements of Section
2.01 above
shall constitute the sole remedy respecting such defect available
to the
Trustee, the Depositor and any Certificateholder against that
Seller.
SECTION 2.03. Representations, Warranties and Covenants of the
Sellers and Master Servicer.
(a) Countrywide hereby makes the representations and warranties
set
forth in (i) Schedule II-A, Schedule II-B, Schedule II-C and
Schedule II-D
hereto, and by this reference incorporated herein, to the
Depositor, the
Master Servicer and the Trustee, as of the Closing Date, (ii)
Schedule III-A
hereto, and by this reference incorporated herein, to the
Depositor, the
Master Servicer and the Trustee, as of the Closing Date, or if so
specified
therein, as of the Cut-off Date, and (iii) Schedule III-B hereto,
and by this
reference incorporated herein, to the Depositor, the Master
Servicer and the
Trustee, as of the Closing Date, or if so specified therein, as of
the Cut-off
Date with respect to the Mortgage Loans that are Countrywide
Mortgage Loans.
Park Granada hereby makes the representations and warranties set
forth in (i)
Schedule II-B hereto, and by this reference incorporated herein, to
the
Depositor, the Master Servicer and the Trustee, as of the Closing
Date and
(ii) Schedule III-C hereto, and by this reference incorporated
herein, to the
Depositor, the Master Servicer and the Trustee, as of the Closing
Date, or if
so specified therein, as of the Cut-off Date with respect to the
Mortgage
Loans that are Park Granada Mortgage Loans. Park Monaco hereby
makes the
representations and warranties set forth in (i) Schedule II-C
hereto, and by
this reference incorporated herein, to the Depositor, the Master
Servicer and
the Trustee, as of the Closing Date and (ii) Schedule III-D hereto,
and by
this reference incorporated herein, to the Depositor, the Master
Servicer and
the Trustee, as of the Closing Date, or if so specified therein, as
of the
Cut-off Date with respect to the Mortgage Loans that are Park
Monaco Mortgage
Loans. Park Sienna hereby makes the representations and warranties
set forth
in (i) Schedule II-D hereto, and by this reference incorporated
herein, to the
Depositor, the Master Servicer and the Trustee, as of the Closing
Date and
(ii) Schedule III-E hereto, and by this reference incorporated
herein, to the
Depositor, the Master Servicer and
II-6
<PAGE>
the Trustee, as of the Closing Date, or if so specified therein, as
of the
Cut-off Date with respect to the Mortgage Loans that are Park
Sienna Mortgage
Loans.
(b) The Master Servicer hereby makes the representations and
warranties set forth in Schedule IV hereto, and by this reference
incorporated
herein, to the Depositor and the Trustee, as of the Closing
Date.
(c) Upon discovery by any of the parties hereto of a breach of
a
representation or warranty with respect to a Mortgage Loan made
pursuant to
Section 2.03(a) that materially and adversely affects the interests
of the
Certificateholders in that Mortgage Loan, the party discovering
such breach
shall give prompt notice thereof to the other parties. 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) 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 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
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<PAGE>
amount required to be deposited therein in connection with such
substitution
as described in the following paragraph, the Trustee shall release
the
Mortgage File held for the benefit of the Certificateholders
relating to such
Deleted Mortgage Loan to the related Seller and shall execute and
deliver at
such Seller's direction such instruments of transfer or assignment
prepared by
Countrywide (on its own behalf and on behalf of Park Granada, Park
Monaco and
Park Sienna), in each case without recourse, as shall be necessary
to vest
title in that Seller, or its designee, the Trustee's interest in
any Deleted
Mortgage Loan substituted for pursuant to this Section 2.03.
For any month in which a Seller substitutes one or more
Substitute
Mortgage Loans for one or more Deleted Mortgage Loans, the Master
Servicer
will determine the amount (if any) by which the aggregate principal
balance of
all Substitute Mortgage Loans sold to the Depositor by that Seller
as of the
date of substitution is less than the aggregate Stated Principal
Balance of
all Deleted Mortgage Loans repurchased by that Seller (after
application of
the scheduled principal portion of the monthly payments due in the
month of
substitution). The amount of such shortage (the "Substitution
Adjustment
Amount") plus an amount equal to the aggregate of any unreimbursed
Advances
with respect to such Deleted Mortgage Loans shall be deposited in
the
Certificate Account by Countrywide (on its own behalf and on behalf
of Park
Granada, Park Monaco and Park Sienna) on or before the Distribution
Account
Deposit Date for the Distribution Date in the month succeeding the
calendar
month during which the related Mortgage Loan became required to be
purchased
or replaced hereunder.
In the event that a Seller shall have repurchased a Mortgage
Loan,
the Purchase Price therefor shall be deposited in the Certificate
Account
pursuant to Section 3.05 on or before the Distribution Account
Deposit Date
for the Distribution Date in the month following the month during
which that
Seller became obligated hereunder to repurchase or replace such
Mortgage Loan
and upon such deposit of the Purchase Price, the delivery of the
Opinion of
Counsel required by Section 2.05 and receipt of a Request for
Release in the
form of Exhibit N hereto, the Trustee shall release the related
Mortgage File
held for the benefit of the Certificateholders to such Person, and
the Trustee
shall execute and deliver at such Person's direction such
instruments of
transfer or assignment prepared by such Person, in each case
without recourse,
as shall be necessary to transfer title from the Trustee. It is
understood and
agreed that the obligation under this Agreement of any Person to
cure,
repurchase or replace any Mortgage Loan as to which a breach has
occurred and
is continuing shall constitute the sole remedy against such Persons
respecting
such breach available to Certificateholders, the Depositor or the
Trustee on
their behalf.
The representations and warranties made pursuant to this
Section
2.03 shall survive delivery of the respective Mortgage Files to the
Trustee
for the benefit of the Certificateholders.
SECTION 2.04. Representations and Warranties of the Depositor as
to
the Mortgage Loans.
The Depositor hereby represents and warrants to the Trustee
with
respect to each 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
Mortgage Loans to it by each Seller, the Depositor had good title
to the
Mortgage Loans and the Mortgage Notes were subject to no offsets,
defenses or
counterclaims.
The Depositor hereby assigns, transfers and conveys to the
Trustee
all of its rights with respect to the Mortgage Loans including,
without
limitation, the representations and warranties of each Seller made
pursuant to
Section 2.03(a)(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.
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<PAGE>
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.
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.
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<PAGE>
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 and the Principal
Reserve Fund.
(a) The Master Servicer shall make reasonable efforts in
accordance
with the customary and usual standards of practice of prudent
mortgage
servicers to collect all payments called for under the terms and
provisions of
the Mortgage Loans to the extent such procedures shall be
consistent with this
Agreement and the terms and provisions of any related Required
Insurance
Policy. Consistent with the foregoing, the Master Servicer may in
its
discretion (i) waive any late payment charge or any 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 related Master Servicing Fee and Prepayment Interest
Excess;
(iii) all payments on account of Prepayment Charges on the
Mortgage
Loans;
(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;
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<PAGE>
(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 related
Master
Servicing Fee.
The foregoing requirements for remittance by the Master
Servicer
shall be exclusive, it being understood and agreed that, without
limiting the
generality of the foregoing, payments in the nature of late payment
charges or
assumption fees, if collected, need not be remitted by the Master
Servicer. In
the event that the Master Servicer shall remit any amount not
required to be
remitted, it may at any time withdraw or direct the institution
maintaining
the Certificate Account to withdraw such amount from the
Certificate Account,
any provision 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
(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
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<PAGE>
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 or the
Distribution Account is maintained shall invest the funds therein
as directed
in writing by the Master Servicer in Permitted Investments, which
shall mature
not later than (i) in the case of the Certificate Account, the
second Business
Day next preceding the related Distribution Account Deposit Date
(except that
if such Permitted Investment is an obligation of the institution
that
maintains such account, then such Permitted Investment shall mature
not later
than the Business Day next preceding such Distribution Account
Deposit Date)
and (ii) in the case of the Distribution Account, the Business Day
next
preceding the Distribution Date (except that if such Permitted
Investment is
an obligation of the institution that maintains such fund or
account, then
such Permitted Investment shall mature not later than such
Distribution Date)
and, in each case, shall not be sold or disposed of prior to its
maturity. All
such Permitted Investments shall be made in the name of the
Trustee, for the
benefit of the Certificateholders. All income and gain net of any
losses
realized from any such investment of funds on deposit in the
Certificate
Account, or the Distribution Account shall be for the benefit of
the Master
Servicer as servicing compensation and shall be remitted to it
monthly as
provided 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 Trustee in its fiduciary capacity shall
not be
liable for the amount of any loss incurred in respect of any
investment or
lack of investment of funds held in the Certificate Account or
the
Distribution Account and made in accordance with this Section
3.05.
(f) The Master
Servicer shall give notice to the Trustee, each
Seller, each Rating Agency and the Depositor of any proposed change
of the
location of the Certificate Account prior to any change thereof.
The Trustee
shall give notice to the Master Servicer, each Seller, each Rating
Agency and
the Depositor of any proposed change of the location of the
Distribution
Account or the Principal Reserve Fund prior to any change
thereof.
(g) The Trustee shall establish and maintain, on behalf of the
Class
P Certificateholders, a Principal Reserve Fund in the name of the
Trustee. On
the Closing Date, the Depositor shall deposit into the Principal
Reserve Fund
$100. Funds on deposit in the Principal Reserve Fund shall not be
invested.
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
III-5
<PAGE>
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 Principal Reserve
Fund.
(a) The Master Servicer may from time to time make withdrawals
from
the Certificate Account for the following purposes:
(i) to pay to the Master Servicer (to the extent not previously
retained by the Master Servicer) the servicing compensation to
which it
is
entitled pursuant to Section 3.14, and to pay to the Master
Servicer,
as
additional servicing compensation, earnings on or investment
income
with
respect to funds in or credited to the Certificate Account;
(ii) to reimburse each of the Master Servicer and the Trustee
for
unreimbursed Advances made by it, such right of reimbursement
pursuant to
this
subclause (ii) being limited to amounts received on the
Mortgage
Loan(s) in respect of which any such Advance was made;
(iii) to reimburse each of the Master Servicer and the Trustee
for
any
Nonrecoverable Advance previously made by it;
(iv) to reimburse the Master Servicer for Insured Expenses from
the
related Insurance Proceeds;
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<PAGE>
(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,
(b)
the related Prepayment Charge Amount and (c) 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:
(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;
III-7
<PAGE>
(v) to reimburse the Trustee for any Nonrecoverable Advance
previously made by the Trustee pursuant to Section 4.01(b) hereof,
such
right of reimbursement pursuant to this subclause (v) being limited
to
amounts not otherwise reimbursed to the Trustee pursuant to
Section
3.08(a)(iii) hereof; and
(vi) to clear and terminate the Distribution Account upon
termination of the Agreement pursuant to Section 9.01 hereof.
(c) On the Business Day before the Class P Principal
Distribution
Date, the Trustee shall transfer from the Principal Reserve Fund to
the
Distribution Account $100 and shall distribute such amount to the
Class P
Certificates on the Class P Principal Distribution Date. Following
the
distributions to be made in accordance with the preceding sentence,
the
Trustee shall then terminate the Principal Reserve Fund.
SECTION 3.09. Maintenance of Hazard Insurance; Maintenance of
Primary Insurance Policies.
(a) The Master Servicer shall cause to be maintained, for each
Mortgage Loan, hazard insurance with extended coverage in an amount
that is at
least equal to the lesser of (i) the maximum insurable value of
the
improvements securing such Mortgage Loan or (ii) the greater of (y)
the
outstanding principal balance of the Mortgage Loan and (z) an
amount such that
the proceeds of such policy shall be sufficient to prevent the
Mortgagor
and/or the mortgagee from becoming a co-insurer. Each such policy
of standard
hazard insurance shall contain, or have an accompanying endorsement
that
contains, a standard mortgagee clause. Any amounts collected by the
Master
Servicer under any such policies (other than the amounts to be
applied to the
restoration or repair of the related Mortgaged Property or amounts
released to
the Mortgagor in accordance with the Master Servicer's normal
servicing
procedures) shall be deposited in the Certificate Account. Any cost
incurred
by the Master Servicer in maintaining any such insurance shall not,
for the
purpose of calculating monthly distributions to the
Certificateholders or
remittances to the Trustee for their benefit, be added to the
principal
balance of the Mortgage Loan, notwithstanding that the terms of the
Mortgage
Loan so permit. Such costs shall be recoverable by the Master
Servicer out of
late payments by the related Mortgagor or out of the proceeds of
liquidation
of the Mortgage Loan or Subsequent Recoveries to the extent
permitted by
Section 3.08 hereof. It is understood and agreed that no earthquake
or other
additional insurance is to be required of any Mortgagor or
maintained on
property acquired in respect of a Mortgage other than pursuant to
such
applicable laws and regulations as shall at any time be in force
and as shall
require such additional insurance. If the Mortgaged Property is
located at the
time of origination of the Mortgage Loan in a federally designated
special
flood hazard area and such area is participating in the national
flood
insurance program, the Master Servicer shall cause flood insurance
to be
maintained with respect to such Mortgage Loan. Such flood insurance
shall be
in an amount equal to the least of (i) the outstanding principal
balance of
the related Mortgage Loan, (ii) the replacement value of the
improvements
which are part of such Mortgaged Property, and (iii) the maximum
amount of
such insurance available for the related Mortgaged Property under
the national
flood insurance program.
(b) The Master Servicer shall not take any action which would
result
in non-coverage under any applicable Primary Insurance Policy of
any loss
which, but for the actions of the Master Servicer, would have been
covered
thereunder. The Master Servicer shall not cancel or refuse to renew
any such
Primary Insurance Policy that is in effect at the date of the
initial issuance
of the Certificates and is required to be kept in force hereunder
unless the
replacement Primary Insurance Policy for such canceled or
non-renewed policy
is maintained with a Qualified Insurer.
III-8
<PAGE>
Except with respect to any Lender PMI Mortgage Loans, the
Master
Servicer shall not be required to maintain any Primary Insurance
Policy (i)
with respect to any Mortgage Loan with a Loan-to-Value Ratio less
than or
equal to 80% as of any date of determination or, based on a new
appraisal, the
principal balance of such Mortgage Loan represents 80% or less of
the new
appraised value or (ii) if maintaining such Primary Insurance
Policy is
prohibited by applicable law. With respect to the Lender PMI
Mortgage Loans,
the Master Servicer shall maintain the Primary Insurance Policy for
the life
of such Mortgage Loans, unless otherwise provided for in the
related Mortgage
Note or prohibited by law.
The Master Servicer agrees to effect the timely payment of the
premiums on each Primary Insurance Policy, and such costs not
otherwise
recoverable shall be recoverable by the Master Servicer from the
related
proceeds of liquidation and Subsequent Recoveries.
(c) In connection with its activities as Master Servicer of the
Mortgage Loans, the Master Servicer agrees to present on behalf of
itself, the
Trustee and Certificateholders, claims to the insurer under any
Primary
Insurance Policies and, in this regard, to take such reasonable
action as
shall be necessary to permit recovery under any Primary Insurance
Policies
respecting defaulted Mortgage Loans. Any amounts collected by the
Master
Servicer under any Primary Insurance Policies shall be deposited in
the
Certificate Account.
SECTION 3.10. Enforcement of Due-on-Sale Clauses; Assumption
Agreements.
(a) Except as otherwise provided in this Section, when any
property
subject to a Mortgage has been conveyed by the Mortgagor, the
Master Servicer
shall to the extent that it has knowledge of such conveyance,
enforce any
due-on-sale clause contained in any Mortgage Note or Mortgage, to
the extent
permitted under applicable law and governmental regulations, but
only to the
extent that such enforcement will not adversely affect or
jeopardize coverage
under any Required Insurance Policy. Notwithstanding the foregoing,
the Master
Servicer is not required to exercise such rights with respect to a
Mortgage
Loan if the Person to whom the related Mortgaged Property has been
conveyed or
is proposed to be conveyed satisfies the terms and conditions
contained in the
Mortgage Note and Mortgage related thereto and the consent of the
mortgagee
under such Mortgage Note or Mortgage is not otherwise so required
under such
Mortgage Note or Mortgage as a condition to such transfer. In the
event that
the Master Servicer is prohibited by law from enforcing any such
due-on-sale
clause, or if coverage under any Required Insurance Policy would be
adversely
affected, or if nonenforcement is otherwise permitted hereunder,
the Master
Servicer is authorized, subject to Section 3.10(b), to take or
enter into an
assumption and modification agreement from or with the person to
whom such
property has been or is about to be conveyed, pursuant to which
such person
becomes liable under the Mortgage Note and, unless prohibited by
applicable
state law, the Mortgagor remains liable thereon, provided that the
Mortgage
Loan shall continue to be covered (if so covered before the Master
Servicer
enters such agreement) by the applicable Required Insurance
Policies. The
Master Servicer, subject to Section 3.10(b), is also authorized
with the prior
approval of the insurers under any Required Insurance Policies to
enter into a
substitution of liability agreement with such Person, pursuant to
which the
original Mortgagor is released from liability and such Person is
substituted
as Mortgagor and becomes liable under the Mortgage Note.
Notwithstanding the
foregoing, the Master Servicer shall not be deemed to be in default
under this
Section by reason of any transfer or assumption which the Master
Servicer
reasonably believes it is restricted by law from preventing, for
any reason
whatsoever.
(b) Subject to the Master Servicer's duty to enforce any
due-on-sale
clause to the extent set forth in Section 3.10(a) hereof, in any
case in which
a Mortgaged Property has been conveyed to a Person by a Mortgagor,
and such
Person is to enter into an assumption agreement or modification
agreement or
supplement to the Mortgage Note or Mortgage that requires the
signature of the
Trustee, or if an instrument of release signed by the Trustee is
required
releasing the Mortgagor from liability on the
III-9
<PAGE>
Mortgage Loan, the Master Servicer shall prepare and deliver or
cause to be
prepared and delivered to the Trustee for signature and shall
direct, in
writing, the Trustee to execute the assumption agreement with the
Person to
whom the Mortgaged Property is to be conveyed and such modification
agreement
or supplement to the Mortgage Note or Mortgage or other instruments
as are
reasonable or necessary to carry out the terms of the Mortgage Note
or
Mortgage or otherwise to comply with any applicable laws regarding
assumptions
or the transfer of the Mortgaged Property to such Person. In
connection with
any such assumption, no material term of the Mortgage Note may be
changed. In
addition, the substitute Mortgagor and the Mortgaged Property must
be
acceptable to the Master Servicer in accordance with its
underwriting
standards as then in effect. Together with each such substitution,
assumption
or other agreement or instrument delivered to the Trustee for
execution by it,
the Master Servicer shall deliver an Officer's Certificate signed
by a
Servicing Officer stating that the requirements of this subsection
have been
met in connection therewith. The Master Servicer shall notify the
Trustee that
any such substitution or assumption agreement has been completed by
forwarding
to the Trustee the original of such substitution or assumption
agreement,
which in the case of the original shall be added to the related
Mortgage File
and shall, for all purposes, be considered a part of such Mortgage
File to the
same extent as all other documents and instruments constituting a
part
thereof. Any fee collected by the Master Servicer for entering into
an
assumption or substitution of liability agreement will be retained
by the
Master Servicer as additional servicing compensation.
SECTION 3.11. Realization Upon Defaulted Mortgage Loans;
Repurchase
of Certain Mortgage Loans.
(a) The Master Servicer shall use reasonable efforts to
foreclose
upon or otherwise comparably convert the ownership of properties
securing such
of the Mortgage Loans as come into and continue in default and as
to which no
satisfactory arrangements can be made for collection of delinquent
payments.
In connection with such foreclosure or other conversion, the Master
Servicer
shall follow such practices and procedures as it shall deem
necessary or
advisable and as shall be normal and usual in its general mortgage
servicing
activities and meet the requirements of the insurer under any
Required
Insurance Policy; provided, however, that the Master Servicer shall
not be
required to expend its own funds in connection with any foreclosure
or towards
the restoration of any property unless it shall determine (i) that
such
restoration and/or foreclosure will increase the proceeds of
liquidation of
the Mortgage Loan after reimbursement to itself of such expenses
and (ii) that
such expenses will be recoverable to it through the proceeds of
liquidation of
the Mortgage Loan and Subsequent Recoveries (respecting which it
shall have
priority for purposes of withdrawals from the Certificate Account).
The Master
Servicer shall be responsible for all other costs and expenses
incurred by it
in any such proceedings; provided, however, that it shall be
entitled to
reimbursement thereof from the proceeds of liquidation of the
Mortgage Loan
and Subsequent Recoveries with respect to the related Mortgaged
Property, as
provided in the definition of Liquidation Proceeds. If the Master
Servicer has
knowledge that a Mortgaged Property which the Master Servicer is
contemplating
acquiring in foreclosure or by deed in lieu of foreclosure is
located within a
1 mile radius of any site listed in the Expenditure Plan for the
Hazardous
Substance Clean Up Bond Act of 1984 or other site with
environmental or
hazardous waste risks known to the Master Servicer, the Master
Servicer will,
prior to acquiring the Mortgaged Property, consider such risks and
only take
action in accordance with its established environmental review
procedures.
With respect to any REO Property, the deed or certificate of
sale
shall be taken in the name of the Trustee for the benefit of
the
Certificateholders, or its nominee, on behalf of the
Certificateholders. The
Trustee's name shall be placed on the title to such REO Property
solely as the
Trustee hereunder and not in its individual capacity. The Master
Servicer
shall ensure that the title to such REO Property references the
Pooling and
Servicing Agreement and the Trustee's capacity thereunder. Pursuant
to its
efforts to sell such REO Property, the Master Servicer shall either
itself or
III-10
<PAGE>
through an agent selected by the Master Servicer protect and
conserve such REO
Property in the same manner and to such extent as is customary in
the locality
where such REO Property is located and may, incident to its
conservation and
protection of the interests of the Certificateholders, rent the
same, or any
part thereof, as the Master Servicer deems to be in the best
interest of the
Certificateholders for the period prior to the sale of such REO
Property. The
Master Servicer shall prepare for and deliver to the Trustee a
statement with
respect to each REO Property that has been rented showing the
aggregate rental
income received and all expenses incurred in connection with the
maintenance
of such REO Property at such times as is necessary to enable the
Trustee to
comply with the reporting requirements of the REMIC Provisions. The
net
monthly rental income, if any, from such REO Property shall be
deposited in
the Certificate Account no later than the close of business on
each
Determination Date. The Master Servicer shall perform the tax
reporting and
withholding required by Sections 1445 and 6050J of the Code with
respect to
foreclosures and abandonments, the tax reporting required by
Section 6050H of
the Code with respect to the receipt of mortgage interest from
individuals and
any tax reporting required by Section 6050P of the Code with
respect to the
cancellation of indebtedness by certain financial entities, by
preparing such
tax and information returns as may be required, in the form
required, and
delivering the same to the Trustee for filing.
In the event that the Trust Fund acquires any Mortgaged Property
as
aforesaid or otherwise in connection with a default or imminent
default on a
Mortgage Loan, the Master Servicer shall dispose of such Mortgaged
Property as
soon as practicable in a manner that maximizes the Liquidation
Proceeds
thereof, but in no event later than three years after its
acquisition by the
Trust Fund. In that event, the Trustee shall have been supplied
with an
Opinion of Counsel to the effect that the holding by the Trust Fund
of such
Mortgaged Property subsequent to a three-year period, if
applicable, will not
result in the imposition of taxes on "prohibited transactions" of
any REMIC
hereunder as defined in section 860F of the Code or cause any REMIC
hereunder
to fail to qualify as a REMIC at any time that any Certificates
are
outstanding, the Trust Fund may continue to hold such Mortgaged
Property
(subject to any conditions contained in such Opinion of Counsel)
after the
expiration of such three-year period. Notwithstanding any other
provision of
this Agreement, no Mortgaged Property acquired by the Trust Fund
shall be
rented (or allowed to continue to be rented) or otherwise used for
the
production of income by or on behalf of the Trust Fund in such a
manner or
pursuant to any terms that would (i) cause such Mortgaged Property
to fail to
qualify as "foreclosure property" within the meaning of section
860G(a)(8) of
the Code or (ii) subject any REMIC hereunder to the imposition of
any federal,
state or local income taxes on the income earned from such
Mortgaged Property
under Section 860G(c) of the Code or otherwise, unless the Master
Servicer has
agreed to indemnify and hold harmless the Trust Fund with respect
to the
imposition of any such taxes.
In the event of a default on a Mortgage Loan one or more of
whose
obligor is not a United States Person, as that term is defined in
Section
7701(a)(30) of the Code, in connection with any foreclosure or
acquisition of
a deed in lieu of foreclosure (together, "foreclosure") in respect
of such
Mortgage Loan, the Master Servicer will cause compliance with the
provisions
of Treasury Regulation Section 1.1445-2(d)(3) (or any successor
thereto)
necessary to assure that no withholding tax obligation arises with
respect to
the proceeds of such foreclosure except to the extent, if any, that
proceeds
of such foreclosure are required to be remitted to the obligors on
such
Mortgage Loan.
The decision of the Master Servicer to foreclose on a defaulted
Mortgage Loan shall be subject to a determination by the Master
Servicer that
the proceeds of such foreclosure would exceed the costs and
expenses of
bringing such a proceeding. The income earned from the management
of any REO
Properties, net of reimbursement to the Master Servicer for
expenses incurred
(including any property or other taxes) in connection with such
management and
net of unreimbursed Master Servicing Fees, Advances and Servicing
Advances,
shall be applied to the payment of principal of and interest on the
related
defaulted Mortgage Loans (with interest accruing as though such
Mortgage Loans
were still
III-11
<PAGE>
current) and all such income shall be deemed, for all purposes in
this
Agreement, to be payments on account of principal and interest on
the related
Mortgage Notes and shall be deposited into the Certificate Account.
To the
extent the net income received during any calendar month is in
excess of the
amount attributable to amortizing principal and accrued interest at
the
related Mortgage Rate on the related Mortgage Loan for such
calendar month,
such excess shall be considered to be a partial prepayment of
principal of the
related Mortgage Loan.
The
proceeds from any liquidation of a Mortgage Loan, as well as
any
income from an REO Property, will be applied in the following order
of
priority: first, to reimburse the Master Servicer for any related
unreimbursed
Servicing Advances and Master Servicing Fees; second, to reimburse
the Master
Servicer or the Trustee for any unreimbursed Advances; third, to
reimburse the
Certificate Account for any Nonrecoverable Advances (or portions
thereof) that
were previously withdrawn by the Master Servicer or the Trustee
pursuant to
Section 3.08(a)(iii) that related to such Mortgage Loan; fourth, to
accrued
and unpaid interest (to the extent no Advance has been made for
such amount or
any such Advance has been reimbursed) on the Mortgage Loan or
related REO
Property, at the Adjusted Net Mortgage Rate to the Due Date
occurring in the
month in which such amounts are required to be distributed; and
fifth, as a
recovery of principal of the Mortgage Loan. Excess Proceeds, if
any, from the
liquidation of a Liquidated Mortgage Loan will be retained by the
Master
Servicer as additional servicing compensation pursuant to Section
3.14.
The Master Servicer, in its sole discretion, shall have the right
to
purchase for its own account from the Trust Fund any Mortgage Loan
which is
151 days or more delinquent at a price equal to the Purchase Price;
provided,
however, that the Master Servicer may only exercise this right on
or before
the next to the last day of the calendar month in which such
Mortgage Loan
became 151 days delinquent (such month, the "Eligible Repurchase
Month");
provided further, that any such Mortgage Loan which becomes current
but
thereafter becomes delinquent may be purchased by the Master
Servicer pursuant
to this Section in any ensuing Eligible Repurchase Month. The
Purchase Price
for any Mortgage Loan purchased hereunder shall be deposited in
the
Certificate Account and the Trustee, upon receipt of a certificate
from the
Master Servicer in the form of Exhibit N hereto, shall release or
cause to be
released to the purchaser of such Mortgage Loan the related
Mortgage File and
shall execute and deliver such instruments of transfer or
assignment prepared
by the purchaser of such Mortgage Loan, in each case without
recourse, as
shall be necessary to vest in the purchaser of such Mortgage Loan
any Mortgage
Loan released pursuant hereto and the purchaser of such Mortgage
Loan shall
succeed to all the Trustee's right, title and interest in and to
such Mortgage
Loan and all security and documents related thereto. Such
assignment shall be
an assignment outright and not for security. The purchaser of such
Mortgage
Loan shall thereupon own such Mortgage Loan, and all security and
documents,
free of any further obligation to the Trustee or the
Certificateholders with
respect thereto.
(b) Countrywide may agree to a modification of any Mortgage
Loan
(the "Modified Mortgage Loan") if (i) the modification is in lieu
of a
refinancing and (ii) the Mortgage Rate on the Modified Mortgage
Loan is
approximately a prevailing market rate for newly-originated
mortgage loans
having similar terms and (iii) Countrywide purchases the Modified
Mortgage
Loan from the Trust Fund as described below. Effective immediately
after the
modification, and, in any event, on the same Business Day on which
the
modification occurs, all interest of the Trustee in the Modified
Mortgage Loan
shall automatically be deemed transferred and assigned to
Countrywide and all
benefits and burdens of ownership thereof, including the right to
accrued
interest thereon from the date of modification and the risk of
default
thereon, shall pass to Countrywide. The Master Servicer shall
promptly deliver
to the Trustee a certification of a Servicing Officer to the effect
that all
requirements of this paragraph have been satisfied with respect to
the
Modified Mortgage Loan. For federal income tax purposes, the
Trustee shall
account for such purchase as a prepayment in full of the Modified
Mortgage
Loan.
III-12
<PAGE>
Countrywide shall remit the Purchase Price for any Modified
Mortgage
Loan to the Master Servicer for deposit into the Certificate
Account pursuant
to Section 3.05 within one Business Day after the purchase of the
Modified
Mortgage Loan. Upon receipt by the Trustee of written notification
of any such
deposit signed by a Servicing Officer, the Trustee shall release
to
Countrywide the related Mortgage File and shall execute and deliver
such
instruments of transfer or assignment, in each case without
recourse, as shall
be necessary to vest in Countrywide any Modified Mortgage Loan
previously
transferred and assigned pursuant hereto. Countrywide covenants and
agrees to
indemnify the Trust Fund against any liability for any
"prohibited
transaction" taxes and any related interest, additions, and
penalties imposed
on the Trust Fund established hereunder as a result of any
modification of a
Mortgage Loan effected pursuant to this subsection (b), any holding
of a
Modified Mortgage Loan by the Trust Fund or any purchase of a
Modified
Mortgage Loan by Countrywide (but such obligation shall not
prevent
Countrywide or any other appropriate Person from in good faith
contesting any
such tax in appropriate proceedings and shall not prevent
Countrywide from
withholding payment of such tax, if permitted by law, pending the
outcome of
such proceedings). Countrywide shall have no right of reimbursement
for any
amount paid pursuant to the foregoing indemnification, except to
the extent
that the amount of any tax, interest, and penalties, together with
interest
thereon, is refunded to the Trust Fund or Countrywide.
SECTION 3.12. Trustee to Cooperate; Release of Mortgage Files.
Upon the payment in full of any Mortgage Loan, or the receipt by
the
Master Servicer of a notification that payment in full will be
escrowed in a
manner customary for such purposes, the Master Servicer will
immediately
notify the Trustee by delivering, or causing to be delivered a
"Request for
Release" substantially in the form of Exhibit N. Upon receipt of
such request,
the Trustee shall promptly release the related Mortgage File to the
Master
Servicer, and the Trustee shall at the Master Servicer's direction
execute and
deliver to the Master Servicer the request for reconveyance, deed
of
reconveyance or release or satisfaction of mortgage or such
instrument
releasing the lien of the Mortgage in each case provided by the
Master
Servicer, together with the Mortgage Note with written evidence
of
cancellation thereon. The Master Servicer is authorized to cause
the removal
from the registration on the MERS System of such Mortgage and to
execute and
deliver, on behalf of the Trustee and the Certificateholders or any
of them,
any and all instruments of satisfaction or cancellation or of
partial or full
release. Expenses incurred in connection with any instrument of
satisfaction
or deed of reconveyance shall be chargeable to the related
Mortgagor. From
time to time and as shall be appropriate for the servicing or
foreclosure of
any Mortgage Loan, including for such purpose, collection under any
policy of
flood insurance, any fidelity bond or errors or omissions policy,
or for the
purposes of effecting a partial release of any Mortgaged Property
from the
lien of the Mortgage or the making of any corrections to the
Mortgage Note or
the Mortgage or any of the other documents included in the Mortgage
File, the
Trustee shall, upon delivery to the Trustee of a Request for
Release in the
form of Exhibit M signed by a Servicing Officer, release the
Mortgage File to
the Master Servicer. Subject to the further limitations set forth
below, the
Master Servicer shall cause the Mortgage File or documents so
released to be
returned to the Trustee when the need therefor by the Master
Servicer no
longer exists, unless the Mortgage Loan is liquidated and the
proceeds thereof
are deposited in the Certificate Account, in which case the Master
Servicer
shall deliver to the Trustee a Request for Release in the form of
Exhibit N,
signed by a Servicing Officer.
If
the Master Servicer at any time seeks to initiate a foreclosure
proceeding in respect of any Mortgaged Property as authorized by
this
Agreement, the Master Servicer shall deliver or cause to be
delivered to the
Trustee, for signature, as appropriate, any court pleadings,
requests for
trustee's sale or other documents necessary to effectuate such
foreclosure or
any legal action brought to obtain judgment against the Mortgagor
on the
Mortgage Note or the Mortgage or to obtain a deficiency judgment or
to
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<PAGE>
enforce any other remedies or rights provided by the Mortgage Note
or the
Mortgage or otherwise available at law or in equity.
SECTION 3.13. Documents, Records and Funds in Possession of
Master
Servicer to be Held for the Trustee.
Notwithstanding any other provisions of this Agreement, the
Master
Servicer shall transmit to the Trustee as required by this
Agreement all
documents and instruments in respect of a Mortgage Loan coming into
the
possession of the Master Servicer from time to time and shall
account fully to
the Trustee for any funds received by the Master Servicer or which
otherwise
are collected by the Master Servicer as Liquidation Proceeds,
Insurance
Proceeds or Subsequent Recoveries in respect of any Mortgage Loan.
All
Mortgage Files and funds collected or held by, or under the control
of, the
Master Servicer in respect of any Mortgage Loans, whether from the
collection
of principal and interest payments or from Liquidation Proceeds and
any
Subsequent Recoveries, including but not limited to, any funds on
deposit in
the Certificate Account, shall be held by the Master Servicer for
and on
behalf of the Trustee and shall be and remain the sole and
exclusive property
of the Trustee, subject to the applicable provisions of this
Agreement. The
Master Servicer also agrees that it shall not create, incur or
subject any
Mortgage File or any funds that are deposited in the Certificate
Account,
Distribution Account or any Escrow Account, or any funds that
otherwise are or
may become due or payable to the Trustee for the benefit of the
Certificateholders, to any claim, lien, security interest,
judgment, levy,
writ of attachment or other encumbrance, or assert by legal action
or
otherwise any claim or right of setoff against any Mortgage File or
any funds
collected on, or in connection with, a Mortgage Loan, except,
however, that
the Master Servicer shall be entitled to set off against and deduct
from any
such funds any amounts that are properly due and payable to the
Master
Servicer under this Agreement.
SECTION 3.14. Servicing Compensation.
As compensation for its activities hereunder, the Master
Servicer
shall be entitled to retain or withdraw from the Certificate
Account an amount
equal to the Master Servicing Fee; provided, that the aggregate
Master
Servicing Fee with respect to any Distribution Date shall be
reduced (i) by an
amount equal to the aggregate of the Prepayment Interest Shortfalls
on all of
the Mortgage Loans, if any, with respect to such Distribution Date,
but not to
exceed the Compensating Interest for such Distribution Date, and
(ii) with
respect to the first Distribution Date, an amount equal to any
amount to be
deposited into the Distribution Account by the Depositor pursuant
to Section
2.01(a) and not so deposited.
Additional servicing compensation in the form of Excess
Proceeds,
Prepayment Interest Excess, assumption fees, late payment charges
and all
income and gain net of any losses realized from Permitted
Investments on funds
in the Certificate Account and Distribution Account shall be
retained by the
Master Servicer to the extent not required to be deposited in the
Certificate
Account pursuant to Section 3.05 hereof. The Master Servicer shall
be required
to pay all expenses incurred by it in connection with its master
servicing
activities hereunder (including payment of any premiums for hazard
insurance
and any Primary Insurance Policy and maintenance of the other forms
of
insurance coverage required by this Agreement) and shall not be
entitled to
reimbursement therefor except as specifically provided in this
Agreement.
SECTION 3.15. Access to Certain Documentation.
The Master Servicer shall provide to the OTS and the FDIC and
to
comparable regulatory authorities supervising Holders and/or
Certificate
Owners and the examiners and supervisory agents of the OTS, the
FDIC and such
other authorities, access to the documentation regarding the
Mortgage Loans
required by applicable regulations of the OTS and the FDIC. Such
access shall
be afforded without
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<PAGE>
charge, but only upon reasonable and prior written request and
during normal
business hours at the offices designated by the Master Servicer.
Nothing in
this Section shall limit the obligation of the Master Servicer to
observe any
applicable law prohibiting disclosure of information regarding the
Mortgagors
and the failure of the Master Servicer to provide access as
provided in this
Section as a result of such obligation shall not constitute a
breach of this
Section.
The Master Servicer acknowledges that as part of its servicing
activities, the Master Servicer shall fully furnish, in accordance
with the
Fair Credit Reporting Act and its implementing regulations,
accurate and
complete information (i.e., favorable and unfavorable) on its
borrower credit
files related to the Mortgage Loans to Equifax, Experian and Trans
Union
Credit Information Company (three of the nationally recognized
credit bureaus)
on a monthly basis.
SECTION 3.16. Annual Statement as to Compliance.
(a) The Master Servicer shall deliver to the Depositor and the
Trustee on or before March 15 of each year, commencing with its
2008 fiscal
year, an Officer's Certificate stating, as to the signer thereof,
that (i) a
review of the activities of the Master Servicer during the
preceding calendar
year (or applicable portion thereof) and of the performance of the
Master
Servicer under this Agreement has been made under such officer's
supervision
and (ii) to the best of such officer's knowledge, based on such
review, the
Master Servicer has fulfilled all its obligations under this
Agreement in all
material respects throughout such year (or applicable portion
thereof), or, if
there has been a failure to fulfill any such obligation in any
material
respect, specifying each such failure known to such officer and the
nature and
status thereof.
(b) The Master Servicer shall cause each Subservicer to deliver
to
the Depositor and the Trustee on or before March 15 of each year,
commencing
with its 2008 fiscal year, an Officer's Certificate stating, as to
the signer
thereof, that (i) a review of the activities of such Subservicer
during the
preceding calendar year (or applicable portion thereof) and of the
performance
of the Subservicer under the applicable Subservicing Agreement or
primary
servicing agreement, has been made under such officer's supervision
and (ii)
to the best of such officer's knowledge, based on such review,
such
Subservicer has fulfilled all its obligations under the
applicable
Subservicing Agreement or primary servicing agreement, in all
material
respects throughout such year (or applicable portion thereof), or,
if there
has been a failure to fulfill any such obligation in any material
respect,
specifying each such failure known to such officer and the nature
and status
thereof.
(c) The Trustee shall forward a copy of each such statement to
each
Rating Agency.
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<PAGE>
SECTION 3.17. Errors and Omissions Insurance; Fidelity Bonds.
The Master Servicer shall for so long as it acts as master
servicer
under this Agreement, obtain and maintain in force (a) a policy or
policies of
insurance covering errors and omissions in the performance of its
obligations
as Master Servicer hereunder and (b) a fidelity bond in respect of
its
officers, employees and agents. Each such policy or policies and
bond shall,
together, comply with the requirements from time to time of FNMA or
FHLMC for
persons performing servicing for mortgage loans purchased by FNMA
or FHLMC. In
the event that any such policy or bond ceases to be in effect, the
Master
Servicer shall obtain a comparable replacement policy or bond from
an insurer
or issuer, meeting the requirements set forth above as of the date
of such
replacement.
SECTION 3.18. [Reserved].
SECTION 3.19. Prepayment Charges.
(a) Notwithstanding anything in this Agreement to the contrary,
in
the event of a Principal Prepayment in full or in part of a
Mortgage Loan, the
Master Servicer may not waive any Prepayment Charge or portion
thereof
required by the terms of the related Mortgage Note unless (i) such
Mortgage
Loan is in default or the Master Servicer believes that such a
default is
imminent, and the Master Servicer determines that such waiver would
maximize
recovery of Liquidation Proceeds for such Mortgage Loan, taking
into account
the value of such Prepayment Charge, or (ii) (A) the enforceability
thereof is
limited (1) by bankruptcy, insolvency, moratorium, receivership, or
other
similar law relating to creditors' rights generally or (2) due to
acceleration
in connection with a foreclosure or other involuntary payment, or
(B) the
enforceability is otherwise limited or prohibited by applicable
law. In the
event of a Principal Prepayment in full or in part with respect to
any
Mortgage Loan, the Master Servicer shall deliver to the Trustee an
Officer's
Certificate substantially in the form of Exhibit T no later than
the third
Business Day following the immediately succeeding Determination
Date with a
copy to the Class P Certificateholders. If the Master Servicer has
waived or
does not collect all or a portion of a Prepayment Charge relating
to a
Principal Prepayment in full or in part due to any action or
omission of the
Master Servicer, other than as provided above, the Master Servicer
shall
deliver to the Trustee, together with the Principal Prepayment in
full or in
part, the amount of such Prepayment Charge (or such portion thereof
as had
been waived) for deposit into the Certificate Account (not later
than 1:00
p.m. Pacific time on the immediately succeeding Master Servicer
Advance Date,
in the case of such Prepayment Charge) for distribution in
accordance with the
terms of this Agreement.
(b) Upon discovery by the Master Servicer or a Responsible
Officer
of the Trustee of a breach of the foregoing subsection (a), the
party
discovering the breach shall give prompt written notice to the
other parties.
(c) Countrywide represents and warrants to the Depositor and
the
Trustee, as of the Closing Date, that the information in the
Prepayment Charge
Schedule (including the attached prepayment charge summary) is
complete and
accurate in all material respects at the dates as of which the
information is
furnished and each Prepayment Charge is permissible and enforceable
in
accordance with its terms under applicable state law, except as
the
enforceability thereof is limited due to acceleration in connection
with a
foreclosure or other involuntary payment.
(d) Upon discovery by the Master Servicer or a Responsible
Officer
of the Trustee of a breach of the foregoing clause (c) that
materially and
adversely affects right of the Holders of the Class P Certificates
to any
Prepayment Charge, the party discovering the breach shall give
prompt written
notice to the other parties. Within 60 days of the earlier of
discovery by the
Master Servicer or receipt of notice by the Master Servicer of
breach, the
Master Servicer shall cure the breach in all material respects
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<PAGE>
or shall pay into the Certificate Account the amount of the
Prepayment Charge
that would otherwise be due from the Mortgagor, less any amount
representing
such Prepayment Charge previously collected and paid by the Master
Servicer
into the Certificate Account.
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<PAGE>
ARTICLE IV
DISTRIBUTIONS AND
ADVANCES BY THE MASTER SERVICER
SECTION 4.01. Advances.
(a) The Master Servicer shall determine on or before each
Master
Servicer Advance Date whether it is required to make an Advance
pursuant to
the definition thereof. If the Master Servicer determines it is
required to
make an Advance, it shall, on or before the Master Servicer Advance
Date,
either (i) deposit into the Certificate Account an amount equal to
the Advance
or (ii) make an appropriate entry in its records relating to the
Certificate
Account that any Amount Held for Future Distribution has been used
by the
Master Servicer in discharge of its obligation to make any such
Advance. Any
funds so applied shall be replaced by the Master Servicer by
deposit in the
Certificate Account no later than the close of business on the next
Master
Servicer Advance Date. The Master Servicer shall be entitled to be
reimbursed
from the Certificate Account for all Advances of its own funds made
pursuant
to this Section as provided in Section 3.08. The obligation to make
Advances
with respect to any Mortgage Loan shall continue if such Mortgage
Loan has
been foreclosed or otherwise terminated and the related Mortgaged
Property has
not been liquidated.
(b) If the Master Servicer determines that it will be unable to
comply with its obligation to make the Advances as and when
described in the
second sentence of Section 4.01(a), it shall use its best efforts
to give
written notice thereof to the Trustee (each such notice a "Trustee
Advance
Notice"; and such notice may be given by telecopy), not later than
3:00 P.M.,
New York time, on the Business Day immediately preceding the
related Master
Servicer Advance Date, specifying the amount that it will be unable
to deposit
(each such amount an "Advance Deficiency") and certifying that such
Advance
Deficiency constitutes an Advance hereunder and is not a
Nonrecoverable
Advance. If the Trustee receives a Trustee Advance Notice on or
before 3:30
P.M., New York time on a Master Servicer Advance Date, the Trustee
shall, not
later than 3:00 P.M., New York time, on the related Distribution
Date, deposit
in the Distribution Account an amount equal to the Advance
Deficiency
identified in such Trustee Advance Notice unless it is prohibited
from so
doing by applicable law. Notwithstanding the foregoing, the Trustee
shall not
be required to make such deposit if the Trustee shall have received
written
notification from the Master Servicer that the Master Servicer has
deposited
or caused to be deposited in the Certificate Account an amount
equal to such
Advance Deficiency. All Advances made by the Trustee pursuant to
this Section
4.01(b) shall accrue interest on behalf of the Trustee at the
Trustee Advance
Rate from and including the date such Advances are made to but
excluding the
date of repayment, with such interest being an obligation of the
Master
Servicer and not the Trust Fund. The Master Servicer shall
reimburse the
Trustee for the amount of any Advance made by the Trustee pursuant
to this
Section 4.01(b) together with accrued interest, not later than the
fifth day
following the related Master Servicer Advance Date. In the event
that the
Master Servicer does not reimburse the Trustee in accordance with
the
requirements of the preceding sentence, the Trustee shall have the
right, but
not the obligation, to immediately (a) terminate all of the rights
and
obligations of the Master Servicer under this Agreement in
accordance with
Section 7.01 and (b) subject to the limitations set forth in
Section 3.04,
assume all of the rights and obligations of the Master Servicer
hereunder.
(c) The Master Servicer shall, not later than the close of
business
on the second Business Day immediately preceding each Distribution
Date,
deliver to the Trustee a report (in form and substance reasonably
satisfactory
to the Trustee) that indicates (i) the Mortgage Loans with respect
to which
the Master Servicer has determined that the related Scheduled
Payments should
be advanced and (ii) the amount of the related Scheduled Payments.
The Master
Servicer shall deliver to the Trustee on
IV-1
<PAGE>
the related Master Servicer Advance Date an Officer's Certificate
of a
Servicing Officer indicating the amount of any proposed Advance
determined by
the Master Servicer to be a Nonrecoverable Advance.
SECTION 4.02. Priorities of Distribution.
(a) (1) With
respect to Available Funds for Loan Group 1, on each
Distribution Date, the Trustee shall withdraw such Available Funds
from the
Distribution Account and apply such funds to distributions on the
specified
Classes of Group 1 Senior Certificates in the following order and
priority
and, in each case, to the extent of Available Funds remaining:
(i) [Reserved];
(ii) concurrently, to each interest-bearing Class of Group 1
Senior
Certificates, an amount allocable to interest equal to the related
Class
Optimal Interest Distribution Amount, any shortfall being allocated
among
such
Classes in proportion to the amount of the Class Optimal
Interest
Distribution Amount, with respect to the Group 1 Certificates, that
would
have
been distributed in the absence of such shortfall, provided
that
prior to an Accrual Termination Date, the related Accrual Amount
shall be
distributed as provided in Section 4.02(a)(1)(iii);
(iii) [Reserved];
(iv) to
each Class of Group 1 Senior Certificates, concurrently, as
follows:
(x) to the Class PO-1 Component, the related PO Formula
Principal Amount, until the Component Balance thereof is reduced
to
zero; and
(y) the related Non-PO Formula Principal Amount, up to the
amount of the Senior Principal Distribution Amount for Loan Group
1
for such Distribution Date, in the following order:
1. to the Class A-R Certificates, until its Class
Certificate Balance is reduced to zero; and
2. to the Class 1-A-1 Certificates, until its Class
Certificate Balance is reduced to zero; and
(v) to the Class PO-1 Component, any related Class PO Deferred
Amount, up to an amount not to exceed the amount calculated
pursuant to
clause (A) of the definition of the Subordinated Principal
Distribution
Amount actually received or advanced for such Distribution Date
(with
such
amount to be allocated first from amounts calculated pursuant
to
clauses (A)(i) and (ii) then clause (iii) of the definition of
Subordinated Principal Distribution Amount);
(2) With respect to the Available Funds for Loan Group 2 on
each
Distribution Date, the Trustee shall withdraw such Available Funds
from the
Distribution Account and apply such funds to distributions on the
specified
Classes of Group 2 Senior Certificates in the following order and
priority
and, in each case, to the extent of such Available Funds
remaining:
(i) [Reserved];
(ii) concurrently, to each interest-bearing Class of Group 2
Senior
Certificates, an amount allocable to interest equal to the related
Class
Optimal Interest Distribution Amount, any
IV-2
<PAGE>
shortfall being allocated among such Classes in proportion to the
amount
of
the Class Optimal Interest Distribution Amount, with respect to
the
Group 2 Certificates, that would have been distributed in the
absence of
such
shortfall; provided that prior to an Accrual Termination Date,
the
related Accrual Amount shall be distributed as provided in
Section
4.02(a)(2)(iii);
(iii) [reserved];
(iv) to each Class of Group 2 Senior Certificates, concurrently,
as
follows:
(x) to the Class PO-2 Component, the related PO Formula
Principal Amount, until the Component Balance thereof is reduced
to
zero; and
(y) the related Non-PO Formula Principal Amount, up to the
amount of the Senior Principal Distribution Amount for Loan Group
2
for such Distribution Date, to the Class 2-A-1 Certificates,
until
its Class
Certificate Balance is reduced to zero; and
(v) to the Class PO-2 Component, any related Class PO Deferred
Amount, up to an amount not to exceed the amount calculated
pursuant to
clause (A) of the definition of the Subordinated Principal
Distribution
Amount actually received or advanced for such Distribution Date
(with
such
amount to be allocated first from amounts calculated pursuant
to
clauses (A)(i) and (ii) then clause (iii) of the definition of
Subordinated Principal Distribution Amount).
(3) On each Distribution Date, after making the distributions
described in Section 4.02(a)(1) and Section 4.02(a)(2) above, the
remaining
Available Funds from each Loan Group will be distributed to the
Senior
Certificates to the extent provided in Section 4.05 hereof.
(4) On each Distribution Date, Available Funds from both Loan
Groups
remaining after making the distributions described in Sections
4.02(a)(1),
4.02(a)(2) and 4.02(a)(3) above, will be distributed to the
Subordinated
Certificates and the Class A-R Certificates in the following order
and
priority and, in each case, to the extent of such funds
remaining:
(A) to the Class M Certificates, an amount allocable to
interest equal
