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EXHIBIT 99.1
------------
5
<PAGE>
========================
CWMBS, INC.,
Depositor
COUNTRYWIDE HOME LOANS, INC.,
Seller
PARK GRANADA LLC,
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 March 1, 2005
-------------------------------------
CHL MORTGAGE PASS-THROUGH TRUST 2005-HYB2
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2005-HYB2
========================
<PAGE>
Table of Contents
Page
ARTICLE I
DEFINITIONS
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES
SECTION 2.01. Conveyance of Mortgage
Loans...............................29
SECTION 2.02. Acceptance by Trustee of the Mortgage
Loans................33
SECTION 2.03. Representations, Warranties and Covenants of
the
Sellers and Master
Servicer................................35
SECTION 2.04. Representations and Warranties of the Depositor
as
to the Mortgage
Loans......................................37
SECTION 2.05. Delivery of Opinion of Counsel in Connection
with
Substitutions..............................................38
SECTION 2.06. Execution and Delivery of
Certificates.....................38
SECTION 2.07. REMIC
Matters..............................................38
SECTION 2.08. Covenants of the Master
Servicer...........................39
ARTICLE III
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
SECTION 3.01. Master Servicer to Service Mortgage
Loans..................40
SECTION 3.02. Subservicing; Enforcement of the Obligations
of
Subservicers...............................................41
SECTION 3.03. Rights of the Depositor and the Trustee in
Respect
of the Master
Servicer.....................................41
SECTION 3.04. Trustee to Act as Master
Servicer..........................42
SECTION 3.05. Collection of Mortgage Loan Payments;
Certificate
Account; Distribution
Account..............................42
SECTION 3.06. Collection of Taxes, Assessments and Similar
Items; Escrow
Accounts.....................................45
SECTION 3.07. Access to Certain Documentation and
Information
Regarding the Mortgage
Loans...............................46
SECTION 3.08. Permitted Withdrawals from the Certificate
Account
and the Distribution
Account...............................46
SECTION 3.09. Maintenance of Hazard Insurance; Maintenance
of
Primary Insurance
Policies.................................48
SECTION 3.10. Enforcement of Due-on-Sale Clauses; Assumption
Agreements.................................................49
SECTION 3.11. Realization Upon Defaulted Mortgage Loans;
Repurchase of Certain Mortgage
Loans.......................50
SECTION 3.12. Trustee to Cooperate; Release of Mortgage
Files............54
i
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SECTION 3.13. Documents, Records and Funds in Possession of
Master Servicer to be Held for the
Trustee.................54
SECTION 3.14. Servicing
Compensation.....................................55
SECTION 3.15. Access to Certain
Documentation............................55
SECTION 3.16. Annual Statement as to
Compliance..........................56
SECTION 3.17. Annual Independent Public Accountants'
Servicing
Statement; Financial
Statements............................56
SECTION 3.18. Errors and Omissions Insurance; Fidelity
Bonds.............57
SECTION 3.19. Notification of
Adjustments................................57
ARTICLE IV
DISTRIBUTIONS AND ADVANCES BY THE MASTER SERVICER
SECTION 4.01.
Advances...................................................58
SECTION 4.02. Priorities of
Distribution.................................59
SECTION 4.03.
[Reserved].................................................62
SECTION 4.04. Allocation of Realized
Losses..............................62
SECTION 4.05. Cross-Collateralization; Adjustments to
Available
Funds......................................................63
SECTION 4.06. Monthly Statements to
Certificateholders...................64
ARTICLE V
THE CERTIFICATES
SECTION 5.01. The
Certificates...........................................66
SECTION 5.02. Certificate Register; Registration of Transfer
and
Exchange of
Certificates...................................66
SECTION 5.03. Mutilated, Destroyed, Lost or Stolen
Certificates..........71
SECTION 5.04. Persons Deemed
Owners......................................71
SECTION 5.05. Access to List of Certificateholders' Names
and
Addresses..................................................71
SECTION 5.06. Maintenance of Office or
Agency............................72
ARTICLE VI
THE DEPOSITOR AND THE MASTER SERVICER
SECTION 6.01. Respective Liabilities of the Depositor and
the
Master
Servicer............................................73
SECTION 6.02. Merger or Consolidation of the Depositor or
the
Master
Servicer............................................73
SECTION 6.03. Limitation on Liability of the Depositor, the
Sellers, the Master Servicer and
Others....................73
SECTION 6.04. Limitation on Resignation of Master
Servicer...............74
ARTICLE VII
DEFAULT
SECTION 7.01. Events of
Default..........................................75
SECTION 7.02. Trustee to Act; Appointment of
Successor...................76
SECTION 7.03. Notification to
Certificateholders.........................78
ii
<PAGE>
ARTICLE VIII
CONCERNING THE TRUSTEE
SECTION 8.01. Duties of
Trustee..........................................79
SECTION 8.02. Certain Matters Affecting the
Trustee......................80
SECTION 8.03. Trustee Not Liable for Certificates or
Mortgage
Loans......................................................81
SECTION 8.04. Trustee May Own
Certificates...............................81
SECTION 8.05. Trustee's Fees and
Expenses................................81
SECTION 8.06. Eligibility Requirements for
Trustee.......................82
SECTION 8.07. Resignation and Removal of
Trustee.........................82
SECTION 8.08. Successor
Trustee..........................................83
SECTION 8.09. Merger or Consolidation of
Trustee.........................83
SECTION 8.10. Appointment of Co-Trustee or Separate
Trustee..............84
SECTION 8.11. Tax
Matters................................................85
ARTICLE IX
TERMINATION
SECTION 9.01. Termination upon Liquidation or Purchase of
all
Mortgage
Loans.............................................88
SECTION 9.02. Final Distribution on the
Certificates.....................88
SECTION 9.03. Additional Termination
Requirements........................89
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.01.
Amendment..................................................91
SECTION 10.02. Recordation of Agreement;
Counterparts.....................92
SECTION 10.03. Governing
Law..............................................93
SECTION 10.04. Intention of
Parties.......................................93
SECTION 10.05.
Notices....................................................93
SECTION 10.06. Severability of
Provisions.................................94
SECTION 10.07.
Assignment.................................................95
SECTION 10.08. Limitation on Rights of
Certificateholders.................95
SECTION 10.09. Inspection and Audit
Rights................................95
SECTION 10.10. Certificates Nonassessable and Fully
Paid..................96
SECTION 10.11.
[Reserved].................................................96
SECTION 10.12. Protection of
Assets.......................................96
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
Sienna...............................................S-II-C-1
Schedule III-A: Representations and Warranties of
Countrywide as to all of the Mortgage
Loans................................................S-III-A-1
Schedule III-B: Representations and Warranties of
Countrywide as to the Countrywide Mortgage
Loans...............................................S-III-B-1
Schedule III-C: Representations and Warranties of Park
Granada as to the Park Granada Mortgage
Loans...............................................S-III-C-1
Schedule III-D: Representations and Warranties of Park
Sienna as to the Park Sienna Mortgage
Loans...............................................S-III-D-1
Schedule IV: Representations and Warranties of the Master
Servicer................................................S-IV-1
Schedule V: Principal Balances Schedule [if
applicable].............................................S-V-1
Schedule VI: Form of Monthly Master Servicer
Report.................S-VI-1
EXHIBITS
Exhibit A: Form of Senior Certificate (excluding Notional
Amount
Certificates)......................................A-1
Exhibit B: Form of Subordinated
Certificate..........................B-1
Exhibit C: Form of Class A-R
Certificate.............................C-1
Exhibit D: Form of Notional Amount
Certificate.......................D-1
Exhibit E: Form of Reverse of
Certificates...........................E-1
Exhibit F: Form of Initial Certification of
Trustee..................F-1
Exhibit G: Form of Delay Delivery Certification of
Trustee...........G-1
Exhibit H: Form of Final Certification of
Trustee....................H-1
Exhibit I: Form of Transfer
Affidavit................................I-1
Exhibit J-1: Form of Transferor Certificate
(Residual).................J-1
Exhibit J-2: Form of Transferor Certificate
(Private)..................J-2
Exhibit K: Form of Investment Letter [Non-Rule
144A].................K-1
Exhibit L: Form of Rule 144A
Letter..................................L-1
Exhibit M: Form of Request for Release (for
Trustee).................M-1
Exhibit N: Form of Request for Release (Mortgage Loan) Paid
in Full, Repurchased and
Replaced)........................N-1
Exhibit O: Standard & Poor's LEVELS(R) Version 5.6
Glossary
Revised, Appendix
E.......................................O-1
Exhibit P:
[Reserved]................................................P-1
iv
<PAGE>
THIS POOLING AND SERVICING AGREEMENT, dated as of March 1, 2005,
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 SIENNA LLC
("Park Sienna"),
a Delaware limited liability company, as a seller (a "Seller"),
COUNTRYWIDE
HOME LOANS SERVICING LP, a Texas limited partnership, as master
servicer (the
"Master Servicer"), and THE BANK OF NEW YORK, a banking
corporation organized
under the laws of the State of New York, as trustee (the
"Trustee").
WITNESSETH THAT
In consideration of the mutual agreements contained in this
Agreement,
the parties to this Agreement agree as follows:
PRELIMINARY STATEMENT
The Depositor is the owner of the Trust Fund that is hereby
conveyed to
the Trustee in return for the Certificates. For federal income
tax purposes,
the Trust Fund, will consist of three real estate mortgage
investment conduits
(each a "REMIC" or, in the alternative, the "Lower Tier REMIC,"
the "Middle
Tier REMIC" and the "Master REMIC," respectively). Each
Certificate, other
than the Class A-R Certificate, will represent ownership of one
or more
regular interests in the Master REMIC for purposes of the REMIC
Provisions.
The Class A-R Certificate represents ownership of the sole class
of residual
interest in the Lower Tier REMIC, the Middle Tier REMIC and the
Master REMIC.
The Master REMIC will hold as assets the several classes of
uncertificated
Middle Tier REMIC Interests (other than the Class MT-A-R
Interest). The Middle
Tier REMIC will hold as assets the several classes of
uncertificated Lower
Tier REMIC Interests (other than the Class LT-A-R Interest). The
Lower Tier
REMIC will hold as assets all property of the Trust Fund. Each
Middle Tier
REMIC Interest (other than the Class MT-A-R Interest) is hereby
designated as
a regular interest in the Middle Tier REMIC. Each Lower Tier
REMIC Interest
(other than the Class LT-A-R Interest) is hereby designated as a
regular
interest in the Lower Tier REMIC. The latest possible maturity
date of all
REMIC regular interests created in this Agreement shall be the
Latest Possible
Maturity Date.
The following table set forth characteristics of the Interests
in the
Lower Tier REMIC:
<TABLE>
<CAPTION>
Initial Corresponding
The Lower Tier REMIC Interests Principal Balance Interest Rate
Loan Group
-------------------------------------- --------------------
---------------- ------------------
<S> <C> <C> <C>
LT-A-1.............................. (1) (2) 1
LT-B-1.............................. (1) (2) 1
LT-C-1.............................. (1) (2) 1
LT-A-2.............................. (1) (2) 2
LT-B-2.............................. (1) (2) 2
LT-C-2.............................. (1) (2) 2
LT-A-R.............................. (3) (3) N/A
---------------
</TABLE>
<PAGE>
(1) Each Class A Lower Tier REMIC Interest will have an Initial
Principal
Balance equal to 0.9% of the Subordinated Portion of its
Corresponding
Loan Group. Each Class B Lower Tier REMIC Interest will have an
Initial
Principal Balance equal to 0.1% of the Subordinated Portion of
its
Corresponding Loan Group. Each Class C Lower Tier REMIC Interest
will
have an Initial Principal Balance equal to the excess of its
Corresponding Loan Group over the initial aggregate principal
balances of
the Class A and Class B Lower Tier REMIC Interests corresponding
to such
Loan Group.
(2) This Lower Tier REMIC Interest will have an Interest Rate
equal to the
weighted average of the Adjusted Net Mortgage Rates of the
Mortgage Loans
in the Corresponding Loan Group.
(3) The Class LT-A-R Lower Tier REMIC Interest is the sole class
of residual
interest in the Lower Tier REMIC. It has no principal balance
and pays no
principal or interest.
On each Distribution Date, the Available Funds shall be
distributed with
respect to the Lower Tier REMIC Interests in the following
manner:
(1) Interest. Interest is to be distributed with respect to each
Lower
Tier REMIC Interest at the rate, or according to the formulas,
described
above;
(2) Principal, if no Cross-Over Situation Exists. If no
Cross-Over
Situation exists with respect to any Class of Lower Tier REMIC
Interests,
Principal Amounts arising with respect to each Loan Group will
be allocated:
first to cause the Loan Group's corresponding Class A and Class
B Lower Tier
REMIC Interests to equal, respectively, 0.9% of the Subordinated
Portion and
0.1% of the Subordinated Portion; and second to the Loan Group's
corresponding
Class C Lower Tier REMIC Interest;
(3) Principal, if a Cross-Over Situation Exists. If a
Cross-Over
Situation exists with respect to the Class A and Class B Lower
Tier REMIC
Interests:
(a) If the Calculation Rate in respect of the outstanding Class
A and
Class B Lower Tier REMIC Interests is less than the
Subordinate
Pass-Through Rate, then Principal Relocation Payments will be
made
proportionately to the outstanding Class A Lower Tier REMIC
Interests
prior to any other Principal Distributions from each such Loan
Group.
(b) If the Calculation Rate in respect of the outstanding Class
A and
Class B Lower Tier REMIC Interests is greater than the
Subordinate
Pass-Through Rate, Principal Relocation Payments will be made to
the
outstanding Class B Lower Tier REMIC Interests prior to any
other
Principal Distributions from each such Loan Group.
In each case, Principal Relocation Payments will be made so as
to cause
the Calculation Rate in respect of the outstanding Class A and
Class B Lower
Tier REMIC Interests to equal the Subordinate Pass-Through Rate.
With respect
to each Loan Group, if (and to the extent that) the sum of (a)
the principal
payments comprising the Principal Remittance Amount received
during the Due
Period and (b) the Realized Losses, are insufficient to make the
necessary
reductions of principal on the Class A and Class B Lower Tier
REMIC Interests,
then interest will be added to the Loan Group's Class C Lower
Tier REMIC
Interest.
2
<PAGE>
(c) The outstanding aggregate Class A and Class B Lower Tier
REMIC
Interests for all Loan Groups will not be reduced below 1
percent of the
excess of (i) the aggregate outstanding Principal Balances of
all Loan
Groups as of the end of any Due Period over (ii) the aggregate
Class
Certificate Balance of the Senior Certificates for all Loan
Groups as of
the related Distribution Date (after taking into account
distributions of
principal on such Distribution Date).
If (and to the extent that) the limitation in paragraph (c)
prevents the
distribution of principal to the Class A and Class B Lower Tier
REMIC
Interests of a Loan Group, and if the Loan Group's Class C Lower
Tier REMIC
Interest has already been reduced to zero, then the excess
principal from that
Loan Group will be paid to the Class C Lower Tier REMIC
Interests of the other
Loan Groups the aggregate Class A and Class B Lower Tier REMIC
Interests of
which are less than one percent of the Subordinated Portion. If
the Loan Group
corresponding to the Class C Lower Tier REMIC Interest that
receives such
payment has a Weighted Average Adjusted Net Mortgage Rate below
the Weighted
Average Adjusted Net Mortgage Rate of the Loan Group making the
payment, then
the payment will be treated by the Lower Tier REMIC as a
Realized Loss.
Conversely, if a Loan Group corresponding to the Class C Lower
Tier REMIC
Interest that receives such payment has a Weighted Average
Adjusted Net
Mortgage Rate above the Weighted Average Adjusted Net Mortgage
Rate of the
Loan Group making the payment, then the payment will be treated
by the Lower
Tier REMIC as a reimbursement for prior Realized Losses.
The following table set forth characteristics of the Interests
in the
Middle Tier REMIC:
<TABLE>
<CAPTION>
--------------------- ---------------------------
----------------------- -----------------------
The Middle
Tier REMIC Corresponding
Interests Initial Principal Balance Interest Rate
Certificates
--------------------- ---------------------------
----------------------- -----------------------
<S> <C> <C> <C>
MT-1-A-1 $50,000,000 (1) 1-A-1, 1-A-IO(2)
--------------------- ---------------------------
----------------------- -----------------------
MT-1-A-2 $20,000,000 (1) 1-A-2, 1-A-IO(3)
--------------------- ---------------------------
----------------------- -----------------------
MT-1-A-3 $1,890,000 (1) 1-A-3, 1-A-IO(4)
--------------------- ---------------------------
----------------------- -----------------------
MT-1-A-4 $60,285,000 (1) 1-A-4, 1-A-IO(5)
--------------------- ---------------------------
----------------------- -----------------------
MT-2-A $305,287,000 (6) 2-A, 2-A-IO(7)
--------------------- ---------------------------
----------------------- -----------------------
MT-$100 $100 (6) A-R
--------------------- ---------------------------
----------------------- -----------------------
MT-M $19,112,000 (8) M
--------------------- ---------------------------
----------------------- -----------------------
MT-B-1 $4,719,000 (8) B-1
--------------------- ---------------------------
----------------------- -----------------------
MT-B-2 $3,539,000 (8) B-2
--------------------- ---------------------------
----------------------- -----------------------
MT-B-3 $2,831,000 (8) B-3
--------------------- ---------------------------
----------------------- -----------------------
MT-B-4 $2,831,000 (8) B-4
--------------------- ---------------------------
----------------------- -----------------------
MT-B-5 $1,417,260 (8) B-5
--------------------- ---------------------------
----------------------- -----------------------
MT-A-R (9) (9) N/A
--------------------- ---------------------------
----------------------- -----------------------
</TABLE>
3
<PAGE>
(1) The interest rate with respect to any Distribution Date (and
the related
Interest Accrual Period) for this Middle Tier REMIC Interest is
a per
annum rate equal to the Weighted Average Adjusted Net Mortgage
Rate of
the Group 1 Mortgage Loans.
(2) For each Interest Accrual Period from the Interest Accrual
Period related
to the first Distribution Date to and including the Distribution
Date in
January 2008, the Class 1-A-IO Certificates are entitled to
receive a
specified portion of the interest payable on the MT-1-A-1 Middle
Tier
REMIC Interest. Specifically, for each such Interest Accrual
Period, the
Class 1-A-IO Certificates are entitled to interest accruals on
the
MT-1-A-1 Middle Tier REMIC Interest at a per annum rate equal
to
1.015399% per annum. For each Interest Accrual Period
thereafter, the
Class 1-A-IO Certificates will be entitled to 0% per annum.
(3) For each Interest Accrual Period from the Interest Accrual
Period related
to the first Distribution Date to and including the Distribution
Date in
January 2008, the Class 1-A-IO Certificates are entitled to
receive a
specified portion of the interest payable on the MT-1-A-2 Middle
Tier
REMIC Interest. Specifically, for each such Interest Accrual
Period, the
Class 1-A-IO Certificates are entitled to interest accruals on
the
MT-1-A-2 Middle Tier REMIC Interest at a per annum rate equal
to
0.794866% per annum. For each Interest Accrual Period
thereafter, the
Class 1-A-IO Certificates will be entitled to 0% per annum.
(4) For each Interest Accrual Period from the Interest Accrual
Period related
to the first Distribution Date to and including the Distribution
Date in
January 2008, the Class 1-A-IO Certificates are entitled to
receive a
specified portion of the interest payable on the MT-1-A-3 Middle
Tier
REMIC Interest. Specifically, for each such Interest Accrual
Period, the
Class 1-A-IO Certificates are entitled to interest accruals on
the
MT-1-A-3 Middle Tier REMIC Interest at a per annum rate equal
to
0.200000% per annum. For each Interest Accrual Period
thereafter, the
Class 1-A-IO Certificates will be entitled to 0% per annum.
(5) For each Interest Accrual Period from the Interest Accrual
Period related
to the first Distribution Date to and including the Distribution
Date in
January 2008, the Class 1-A-IO Certificates are entitled to
receive a
specified portion of the interest payable on the MT-1-A-4 Middle
Tier
REMIC Interest. Specifically, for each such Interest Accrual
Period, the
Class 1-A-IO Certificates are entitled to interest accruals on
the
MT-1-A-4 Middle Tier REMIC Interest at a per annum rate equal
to
0.604399% per annum. For each Interest Accrual Period
thereafter, the
Class 1-A-IO Certificates will be entitled to 0% per annum.
(6) The interest rate with respect to any Distribution Date (and
the related
Interest Accrual Period) for this Middle Tier REMIC Interest is
a per
annum rate equal to the Weighted Average Adjusted Net Mortgage
Rate of
the Group 2 Mortgage Loans.
(7) For each Interest Accrual Period from the Interest Accrual
Period related
to the first Distribution Date to and including the Distribution
Date in
January 2010, the Class 2-A-IO Certificates are entitled to
receive a
specified portion of the interest payable on the MT-2-A Middle
Tier REMIC
Interest. Specifically, for each Interest Accrual Period, the
Class
2-A-IO Certificates are entitled to interest accruals on the
MT-2-A
Middle Tier REMIC Interest at a per annum rate equal to 0.3500%
per
annum. For each Interest Accrual Period thereafter, the Class
2-A-IO
Certificates will be entitled to 0% per annum.
4
<PAGE>
(8) For each Interest Accrual Period, the interest rate for this
Middle Tier
REMIC Interest will be the Subordinate Pass-Through Rate.
(9) The MT-A-R is the sole Class of residual interest in the
Middle Tier
REMIC. It pays no interest or principal.
On each Distribution Date, the Available Funds shall be
distributed with
respect to the Middle Tier REMIC Interests in the following
manner:
(1) Interest is to be distributed with respect to each Middle
Tier REMIC
Interest at the rate, or according to the formulas, described
above; and
(2) Principal is to be distributed with respect to each Middle
Tier REMIC
Interest in the same manner and in the same amount as principal
is distributed
with respect to each Middle Tier REMIC Interest's Corresponding
Class or
Classes of Certificates.
On each Distribution Date, Realized Losses (and increases in
Principal
Balances attributable to Subsequent Recoveries) shall be
allocated among the
Middle Tier REMIC Interests in the same manner that Realized
Losses (and
increases in Class Certificate Balances attributable to
Subsequent Recoveries)
are allocated among each Middle Tier REMIC Interest's
Corresponding Class or
Classes of Certificates.
The following table sets forth characteristics of the
Certificates,
together with minimum denominations and integral multiples in
excess thereof
in which such Classes shall be issued (except that one
Certificate of each
Class of Certificates may be issuable in a different amount and,
in addition,
one Residual Certificate representing the Tax Matters Person
Certificate may
be issued in a different amount for each class of REMIC
Interest):
5
<PAGE>
<TABLE>
<CAPTION>
==================== =================== =================
==================== =================
Integral
Initial Class Pass-Through Multiples
Class Certificate Rate Minimum in Excess of
Designation Balance (per annum) Denomination Minimum
-------------------- ------------------- -----------------
-------------------- -----------------
<S> <C> <C> <C> <C>
Class 1-A-1 $50,000,000 (1) $25,000.00 $1,000.00
-------------------- ------------------- -----------------
-------------------- -----------------
Class 1-A-2 $20,000,000 (1) $25,000.00 $1,000.00
-------------------- ------------------- -----------------
-------------------- -----------------
Class 1-A-3 $1,890,000 (1) $25,000.00 $1,000.00
-------------------- ------------------- -----------------
-------------------- -----------------
Class 1-A-4 $60,285,000 (1) $25,000.00 $1,000.00
-------------------- ------------------- -----------------
-------------------- -----------------
Class 1-A-IO (2) (3) $25,000.00(9) $1,000.00(9)
-------------------- ------------------- -----------------
-------------------- -----------------
Class 2-A $305,287,000 (4) $25,000.00 $1,000.00
-------------------- ------------------- -----------------
-------------------- -----------------
Class 2-A-IO (5) $25,000.00(9) $1,000.00(9)
(2)
-------------------- ------------------- -----------------
-------------------- -----------------
Class A-R $100.00 (8) (7) (7)
-------------------- ------------------- -----------------
-------------------- -----------------
Class M $19,112,000 (6) $25,000.00 $1,000.00
-------------------- ------------------- -----------------
-------------------- -----------------
Class B-1 $4,719,000 (6) $25,000.00 $1,000.00
-------------------- ------------------- -----------------
-------------------- -----------------
Class B-2 $3,539,000 (6) $25,000.00 $1,000.00
-------------------- ------------------- -----------------
-------------------- -----------------
Class B-3 $2,831,000 (6) $100,000.00 $1,000.00
-------------------- ------------------- -----------------
-------------------- -----------------
Class B-4 $2,831,000 (6) $100,000.00 $1,000.00
-------------------- ------------------- -----------------
-------------------- -----------------
Class B-5 $1,417,260 (6) $100,000.00 $1,000.00
==================== =================== =================
==================== =================
</TABLE>
---------
(1) For each Interest Accrual Period for any Distribution Date,
the
Pass-Through Rates for the Class 1-A-1, Class 1-A-2, Class 1-A-3
and
Class 1-A-4 Certificates will be a per annum rate equal to the
Weighted
Average Adjusted Net Mortgage Rate of the Group 1 Mortgage
Loans, minus
the Component Rate for the Class 1-A-1-IO, Class 1-A-2-IO, Class
1-A-3-IO
and Class 1-A-4-IO Components, respectively. The Pass-Through
Rates for
the Class 1-A-1, Class 1-A-2, Class 1-A-3 and Class 1-A-4
Certificates
for the Interest Accrual Period related to the first
Distribution Date
will be 4.1680%, 4.3885%, 4.9834% and 4.5790% per annum,
respectively.
(2) The Class 1-A-IO and Class 2-A-IO Certificates will be
Notional Amount
Certificates, will have no Class Certificate Balances and will
bear
interest on their respective Notional Amounts (initially
$132,175,000 and
$305,287,000, respectively).
(3) The Pass-Through Rate for the Class 1-A-IO Certificates for
each Interest
Accrual Period for any Distribution Date (x) on or prior to the
January
2008 Distribution Date will be a per annum rate equal to the
Weighted
Average Component Rate and (y) for any Distribution Date after
the
January 2008 Distribution Date, will be 0% per annum. The
Pass-Through
Rates for the Class 1-A-IO Certificates for the Interest Accrual
Period
related to the first Distribution Date will be 0.7829% per
annum.
(4) For each Interest Accrual Period for any Distribution Date,
the
Pass-Through Rate for the Class 2-A Certificates will be a per
annum rate
equal to the Weighted Average Adjusted Net Mortgage Rate of the
Group 2
Mortgage Loans, minus the Pass-Through Rate for the Class
2-A-IO
Certificates. The Pass-Through Rates for the Class 2-A
Certificates for
the Interest Accrual Period related to the first Distribution
Date will
be 4.8362% per annum.
6
<PAGE>
(5) The Pass-Through Rate for the Class 2-A-IO Certificates for
each Interest
Accrual Period for any Distribution Date (x) on or prior to the
January
2010 Distribution Date will be a per annum rate equal to 0.3500%
and (y)
for any Distribution Date after the January 2010 Distribution
Date, will
be 0% per annum.
(6) The Pass-Through Rate for each Class of Subordinated
Certificates for
each Interest Accrual Period for any Distribution Date will be a
per
annum rate equal to the Subordinate Pass-Through Rate. The
Pass-Through
Rate for the Subordinated Certificates for the Interest Accrual
Period
for the first Distribution Date is 5.1853%.
(7) The Class A-R Certificate will 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
$.01.
(8) The Class A-R Certificates will not bear interest.
(9) Based on the Notional Amount.
7
<PAGE>
Set forth below are designations of Classes or Components of
Certificates
to the categories used in this Agreement:
<TABLE>
<CAPTION>
<S> <C>
Accretion Directed
Certificates................. None.
Accrual Certificates......... None.
Accrual Components........... None.
Book-Entry Certificates...... All Classes of Certificates other
than the Physical
Certificates.
COFI Certificates............ None.
Component Certificates....... Class 1-A-IO Certificates.
Components................... Class 1-A-1-IO, Class 1-A-2-IO,
Class
1-A-3-IO and Class 1-A-4-IO Components.
Delay Certificates........... All interest-bearing Classes of
Certificates other than
the Non-Delay Certificates, if any.
ERISA-Restricted
Certificates................. The Residual Certificates, the
Private Certificates and,
until they have been the subject of an ERISA Qualifying
Underwriting, the Class 1-A-IO and Class 2-A-IO
Certificates; and any Certificate that does not or no
longer satisfies the applicable rating requirement under
the Underwriter's Exemption.
Group 1
Senior Certificates.......... Class 1-A-1, Class 1-A-2, Class
1-A-3, Class 1-A-4 and
Class 1-A-IO Certificates.
Group 1 Certificates......... Group 1 Senior Certificates and
the Subordinated Portion
related to Loan Group 1.
Group 2
Senior Certificates.......... Class 2-A, Class 2-A-IO and Class
A-R Certificates.
Group 2 Certificates......... Group 2 Senior Certificates and
the Subordinated Portion
related to Loan Group 2.
LIBOR Certificates........... None.
Non-Delay Certificates....... None.
8
<PAGE>
Notional Amount
Certificates................. Class 1-A-IO and Class 2-A-IO
Certificates.
Offered Certificates......... All Classes of Certificates other
than the Private
Certificates.
Physical Certificates........ Private Certificates and the
Residual Certificates.
Planned Principal Classes.... None.
Planned Principal
Components................... None.
Private Certificates......... Class B-3, Class B-4 and Class B-5
Certificates.
Rating Agencies.............. S&P and Moody's.
Regular Certificates......... All Classes of Certificates, other
than the Residual
Certificates.
Residual Certificates........ Class A-R Certificates.
Senior Certificate Group..... Group 1 Senior Certificates and
Group 2 Senior
Certificates, as applicable.
Senior Certificates.......... Class 1-A-1, Class 1-A-2, Class
1-A-3, Class 1-A-4,
Class 1-A-IO, Class 2-A, Class 2-A-IO 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.
</TABLE>
With respect to any of the foregoing designations as to which
the
corresponding reference is "None," all defined terms and
provisions in this
Agreement relating solely to such designations shall be of no
force or effect,
and any calculations in this Agreement incorporating references
to such
designations shall be interpreted without reference to such
designations and
amounts. Defined terms and provisions in this Agreement relating
to
statistical rating agencies not designated above as Rating
Agencies shall be
of no force or effect.
9
<PAGE>
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and
phrases, unless the
context otherwise requires, shall have the following
meanings:
Accretion Directed Certificates: As specified in the
Preliminary
Statement.
Accretion Direction Rule: Not applicable.
Accrual Amount: Not applicable.
Accrual Certificates: As specified in the Preliminary
Statement.
Accrual Components: As specified in the Preliminary
Statement.
Accrual Termination Date: Not applicable.
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 Expense Fee
Rate.
Adjustment Date: A date specified in each Mortgage Note as a
date on
which the Mortgage Rate on the related Mortgage Loan will be
adjusted.
Advance: As to a Loan Group, the payment required to be made by
the
Master Servicer with respect to any Distribution Date pursuant
to Section
4.01, the amount of any such payment being equal to the
aggregate of payments
of principal and interest (net of the Master Servicing Fee) on
the Mortgage
Loans in such Loan Group that were due on the related Due Date
and not
received by the Master Servicer as of the close of business on
the related
Determination Date, together with an amount equivalent to
interest on each
Mortgage Loan as to which the related Mortgaged Property is an
REO Property
net of any net income with respect to such REO Property, less
the aggregate
amount of any such delinquent payments that the Master Servicer
has determined
would constitute a Nonrecoverable Advance if advanced.
Aggregate Subordinated Percentage: As to any Distribution Date,
the
fraction, expressed as a percentage, the numerator of which is
equal to the
aggregate Class Certificate Balance of the Subordinated
Certificates
immediately prior to such Distribution Date and the denominator
of which is
the aggregate Stated Principal Balance of all the Mortgage Loans
as of the Due
Date in the month preceding the month of such Distribution
Date.
Agreement: This Pooling and Servicing Agreement and all
amendments or
supplements this Pooling and Servicing Agreement.
10
<PAGE>
Allocable Share: As to any Distribution Date, any Loan Group and
any
Class or Component of Certificates, 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 for such Class or after the first 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 aggregate amount
calculated with
respect to such Distribution Date for each such related Class of
Certificates
pursuant to clause (i) of the definition of Class Optimal
Interest
Distribution Amount (without giving effect to any reduction of
such amounts
pursuant to Section 4.02(d)) or the definition of Assumed
Interest Amount for
such Loan Group and Class, as applicable.
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 that Loan Group and (ii) all
Scheduled Payments
due after the related Due Date relating to that Loan Group.
Applicable Credit Support Percentage: As defined in Section
4.02(e).
Appraised Value: With respect to a Mortgage Loan other than a
Refinancing
Mortgage Loan, the lesser of (a) the value of the Mortgaged
Property based
upon the appraisal made at the time of the origination of such
Mortgage Loan
and (b) the sales price of the Mortgaged Property at the time of
the
origination of such Mortgage Loan. 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. With respect to a
Streamlined
Documentation Mortgage Loan, (a) if the loan-to-value ratio with
respect to
the Original Mortgage Loan at the time of the origination
thereof was 80% or
less and the loan amount of the new mortgage loan is $650,000 or
less, the
value of the Mortgaged Property based upon the appraisal made at
the time of
the origination of the Original Mortgage Loan and (b) if the
loan-to-value
ratio with respect to the Original Mortgage Loan at the time of
the
origination thereof was greater than 80% or the loan amount of
the new
mortgage loan 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 Interest Amount: With respect to any Distribution Date,
any Class
of Subordinated Certificates and any Loan Group, one month's
interest accrued
during the related Interest Accrual Period at the Pass-Through
Rate on the
related Subordinated Portion immediately prior to that
Distribution Date.
Available Funds: As to any Distribution Date and each Loan
Group, the sum
of (a) the aggregate amount held in the Certificate Account at
the close of
business on the related Determination Date in respect of the
related Mortgage
Loans pursuant to Section 3.05(b) net of
2
<PAGE>
the related Amount Held for Future Distribution and net of
amounts permitted
to be withdrawn from the Certificate Account pursuant to clauses
(i) - (viii),
inclusive, of Section 3.08(a) in respect of the Mortgage Loans
in that Loan
Group and amounts permitted to be withdrawn from the
Distribution Account
pursuant to clauses (i) - (iii), inclusive, of Section 3.08(b)
in respect of
the Mortgage Loans in that Loan Group, (b) the amount of the
related Advance
(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 and (d) the
Transfer Payment Received plus interest thereon as provided in
Section 4.05
for such Loan Group less the Transfer Payment Made plus interest
thereon as
provided in Section 4.05 for such Loan Group; provided, however,
that on the
first 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 Groups and
on any
Distribution Date thereafter, Available Funds shall be
calculated based on all
the Mortgage Loans in the Mortgage Pool, as opposed to the
Mortgage Loans in
the related Loan Group.
Bankruptcy Code: Title 11 of the United States Code, as
amended.
Benefit Plan Opinion: As defined in Section 5.02(b).
Book-Entry Certificates: As specified in the Preliminary
Statement.
Business Day: Any day other than (i) a Saturday or a Sunday or
(ii) a day
on which banking institutions in the City of New York, New York,
or the States
of California or Texas or the city in which the Corporate Trust
Office of the
Trustee is located are authorized or obligated by law or
executive order to be
closed.
Calculation Rate: For each Distribution Date, in the case of the
Class A
and Class B Lower Tier REMIC Interests, 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 capped at zero or reduced by a
fixed
percentage of 100% of the interest accruing on such Class A
Interest.
Certificate: Any one of the Certificates executed by the Trustee
in
substantially the forms attached this Agreement as exhibits.
Certificate Account: The separate Eligible Account or Accounts
created
and maintained by the Master Servicer pursuant to Section 3.05
with a
depository institution 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 2005-HYB2, Mortgage Pass-Through Certificates
Series
2005-HYB2."
Certificate Balance: With respect to any Certificate at any
date, the
maximum dollar amount of principal to which the Holder thereof
is then
entitled under this Agreement, such amount being equal to the
Denomination of
that Certificate (A) plus any increase in the Certificate
Balance of such
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 to that Certificate and (ii) all Realized
Losses allocated
to that Certificate and, in the case of any
3
<PAGE>
Subordinated Certificates, all other reductions in Certificate
Balance
previously allocated to that Certificate pursuant to Section
4.04 without
duplication.
Certificate Group: The Group 1 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 under this Agreement, it shall first have to provide
evidence of its
beneficial ownership interest in a Certificate that is
reasonably satisfactory
to the Trustee, the Depositor, and/or the Master Servicer, as
applicable.
Certificate Register: The register maintained pursuant to
Section 5.02.
Certificateholder or Holder: The person in whose name a
Certificate is
registered in the Certificate Register, except that, solely for
the purpose of
giving any consent pursuant to this Agreement, any Certificate
registered in
the name of the Depositor or any affiliate of the Depositor
shall be deemed
not to be Outstanding and the Percentage Interest evidenced
thereby shall not
be taken into account in determining whether the requisite
amount of
Percentage Interests necessary to effect such consent has been
obtained;
provided, however, that if any such Person (including the
Depositor) owns 100%
of the Percentage Interests evidenced by a Class of
Certificates, such
Certificates shall be deemed to be Outstanding for purposes of
any provision
of this Agreement (other than the second sentence of Section
10.01) that
requires the consent of the Holders of Certificates of a
particular Class as a
condition to the taking of any action under this Agreement. The
Trustee is
entitled to rely conclusively on a certification of the
Depositor or any
affiliate of the Depositor in determining which Certificates are
registered in
the name of an affiliate of the Depositor.
Class: All Certificates bearing the same class designation as
set forth
in the Preliminary Statement.
Class Certificate Balance: With respect to any Class and as to
any date
of determination, the aggregate of the Certificate Balances of
all
Certificates of such Class as of such date.
Class Interest Shortfall: As to any Distribution Date and Class
or
Component, the amount by which the amount described in clause
(i) of the
definition of Class Optimal Interest Distribution Amount for
such Class or
Component exceeds the amount of interest actually distributed on
such Class or
Component 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 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 or Notional Amount as of the last day
of the related
Interest Accrual Period, subject to reduction as provided in
Section 4.02(d)
and (ii) any Class Unpaid Interest Amounts for such Class or
Component.
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 Certificates
immediately prior to such Distribution Date divided by
4
<PAGE>
(b) the aggregate of the Class Certificate Balances of all
Classes of
Certificates immediately prior to such Distribution Date.
Class Unpaid Interest Amounts: As to any Distribution Date and
Class or
Component of interest-bearing Certificates, the amount by which
the aggregate
Class Interest Shortfalls for such Class or Component on prior
Distribution
Dates exceeds the amount distributed on such Class or Component
on prior
Distribution Dates pursuant to clause (ii) of the definition of
Class Optimal
Interest Distribution Amount.
Closing Date: March 30, 2005.
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.
Compensating Interest: As to any Distribution Date and Loan
Group, an
amount equal to one-half of the Master Servicing Fee for the
related Loan
Group for such Distribution Date.
Component: As specified in the Preliminary Statement.
Component Notional Amount: With respect to the Class 1-A-1-IO,
Class
1-A-2-IO, Class 1-A-3-IO and Class 1-A-4-IO Components and any
date, an amount
equal to (i) for any date prior to and including the last day of
the Interest
Accrual Period for the Distribution Date in January 2008, the
Class
Certificate Balances of the Class 1-A-1, Class 1-A-2, Class
1-A-3 and Class
1-A-4 Certificates, respectively, as of such date and (ii) after
the last day
of the Interest Accrual Period for the Distribution Date in
January 2008, $0.
Component Rate: For each Interest Accrual Period for any
Distribution
Date (x) on or prior to the January 2008 Distribution Date, the
per annum rate
equal to the Component Rate set forth in the table below and (y)
for any
Distribution Date after the January 2008 Distribution Date, 0%
per annum.
Component
Designation Rate
-------------- ---------------
Class 1-A-1-IO Component............ 1.015399%
Class 1-A-2-IO Component............ 0.794866%
Class 1-A-3-IO Component............ 0.200000%
Class 1-A-4-IO Component............ 0.604399%
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
5
<PAGE>
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,
CHL Mortgage
Pass-Through Trust 2005-HYB2), facsimile no. (212) 815-3986, and
which is the
address to which notices to and correspondence with the Trustee
should be
directed.
Countrywide: Countrywide Home Loans, Inc., a New York
corporation and its
successors and assigns, in its capacity as the seller of the
Countrywide
Mortgage Loans to the Depositor.
Countrywide Mortgage Loans: The Mortgage Loans identified as
such on the
Mortgage Loan Schedule for which Countrywide is the applicable
Seller.
Countrywide Servicing: Countrywide Home Loans Servicing LP, a
Texas
limited partnership and its successors and assigns.
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 Subordinate
Component Balance
of the Loan Group to which they correspond.
Cut-off Date: For each Mortgage Loan, the later of March 1, 2005
and the
date of origination for that Mortgage Loan.
Cut-off Date Pool Principal Balance: $471,911,361.
Cut-off Date Principal Balance: As to any Mortgage Loan, the
Stated
Principal Balance thereof as of the close of business on the
Cut-off Date.
Debt Service Reduction: With respect to any Mortgage Loan, a
reduction by
a court of competent jurisdiction in a proceeding under the
Bankruptcy Code in
the Scheduled Payment for such Mortgage Loan that became final
and
non-appealable, except such a reduction resulting from a
Deficient Valuation
or any reduction that results in a permanent forgiveness of
principal.
6
<PAGE>
Defective Mortgage Loan: Any Mortgage Loan that is required to
be
repurchased pursuant to Section 2.02 or 2.03.
Deficient Valuation: With respect to any Mortgage Loan, a
valuation by a
court of competent jurisdiction of the Mortgaged Property in an
amount less
than the then-outstanding indebtedness under the Mortgage Loan,
or any
reduction in the amount of principal to be paid in connection
with any
Scheduled Payment that results in a permanent forgiveness of
principal, which
valuation or reduction results from an order of such court which
is final and
non-appealable in a proceeding under the Bankruptcy Code.
Definitive Certificates: Any Certificate evidenced by a
Physical
Certificate and any Certificate issued in lieu of a Book-Entry
Certificate
pursuant to Section 5.02(e).
Delay Certificates: As specified in the Preliminary
Statement.
Delay Delivery Certification: As defined in Section 2.02(a).
Delay Delivery Mortgage Loans: The Mortgage Loans for which all
or a
portion of a related Mortgage File is not delivered to Trustee
on the Closing
Date. With respect to up to 50% of the Mortgage Loans in each
Loan Group, the
Depositor may deliver all or a portion of each related Mortgage
File to the
Trustee not later than thirty days after the Closing Date. To
the extent that
Countrywide Servicing shall be in possession of any Mortgage
Files with
respect to any Delay Delivery Mortgage Loan, until delivery of
such Mortgage
File to the Trustee as provided in Section 2.01, Countrywide
Servicing shall
hold such files as Master Servicer hereunder, as agent and in
trust for the
Trustee.
Deleted Mortgage Loan: As defined in Section 2.03(c).
Denomination: With respect to each Certificate, the amount set
forth on
the face of that Certificate as the "Initial Certificate Balance
of this
Certificate" or the "Initial Notional Amount of this
Certificate" or, if
neither of the foregoing, the Percentage Interest appearing on
the face
thereof.
Depositor: CWMBS, Inc., a Delaware corporation, or its successor
in
interest.
Depository: The initial Depository shall be The Depository Trust
Company,
the nominee of which is CEDE & Co., as the registered Holder
of the Book-Entry
Certificates. The Depository shall at all times be a "clearing
corporation" as
defined in Section 8-102(a)(5) of the Uniform Commercial Code of
the State of
New York.
Depository Participant: A broker, dealer, bank or other
financial
institution or other Person for whom from time to time a
Depository effects
book-entry transfers and pledges of securities deposited with
the Depository.
Determination Date: As to any Distribution Date, the 15th day of
each
month or, if such 15th day is not a Business Day, the preceding
Business Day;
provided, however, that if such 15th day or such Business Day,
whichever is
applicable, is less than two Business Days prior to the
7
<PAGE>
related Distribution Date, the Determination Date shall be the
first Business
Day that is two Business Days preceding such Distribution
Date.
Distribution Account: The separate Eligible Account created
and
maintained by the Trustee pursuant to Section 3.05(d) in the
name of the
Trustee for the benefit of the Certificateholders and designated
"The Bank of
New York in trust for registered holders of CHL Mortgage
Pass-Through Trust
2005-HYB2, Mortgage Pass-Through Certificates, Series
2005-HYB2." 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 Business Day immediately following the
Master
Servicer Remittance Date, commencing in April 2005.
Due Date: With respect to any Distribution Date, the first day
of the
month in which that Distribution Date occurs.
Eligible Account: Any of (i) an account or accounts maintained
with a
federal or state chartered depository institution or trust
company the
short-term unsecured debt obligations of which (or, in the case
of a
depository institution or trust company that is the principal
subsidiary of a
holding company, the debt obligations of such holding company)
have the
highest short-term ratings of Moody's or Fitch and one of the
two highest
short-term ratings of S&P, if S&P is a Rating Agency at
the time any amounts
are held on deposit therein, or (ii) an account or accounts in a
depository
institution or trust company in which such accounts are insured
by the FDIC
(to the limits established by the FDIC) and the uninsured
deposits in which
accounts are otherwise secured such that, as evidenced by an
Opinion of
Counsel delivered to the Trustee and to each Rating Agency,
the
Certificateholders have a claim with respect to the funds in
such account or a
perfected first priority security interest against any
collateral (which shall
be limited to Permitted Investments) securing such funds that is
superior to
claims of any other depositors or creditors of the depository
institution or
trust company in which such account is maintained, or (iii) a
trust account or
accounts maintained with (a) the trust department of a federal
or state
chartered depository institution or (b) a trust company, acting
in its
fiduciary capacity or (iv) any other account acceptable to each
Rating Agency.
Eligible Accounts may bear interest, and may include, if
otherwise qualified
under this definition, accounts maintained with the Trustee.
Eligible Repurchase Month: As defined in Section 3.11.
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
an
Underwriter's Exemption.
ERISA-Restricted Certificate: As specified in the Preliminary
Statement.
8
<PAGE>
Escrow Account: The Eligible Account or Accounts established
and
maintained pursuant to Section 3.06(a).
Event of Default: As defined in Section 7.01.
Excess Proceeds: With respect to any Liquidated Mortgage Loan,
the
amount, if any, by which the sum of any Liquidation Proceeds of
such Mortgage
Loan received in the calendar month in which such Mortgage Loan
became a
Liquidated Mortgage Loan 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.
Expense Fee Rate: As to each Mortgage Loan and any date of
determination,
the sum of (a) the related Master Servicing Fee Rate and (b) the
Trustee Fee
Rate.
FDIC: The Federal Deposit Insurance Corporation, or any
successor
thereto.
FHLMC: The Federal Home Loan Mortgage Corporation, a
corporate
instrumentality of the United States created and existing under
Title III of
the Emergency Home Finance Act of 1970, as amended, or any
successor to the
Federal Home Loan Mortgage Corporation.
Final Certification: As defined in Section 2.02(a).
FIRREA: The Financial Institutions Reform, Recovery, and
Enforcement Act
of 1989.
Fitch: Fitch, Inc., or any successor thereto. If Fitch is
designated as a
Rating Agency in the Preliminary Statement, for purposes of
Section 10.05(b)
the address for notices to Fitch shall be Fitch, Inc., One State
Street Plaza,
New York, New York 10004, Attention: Residential Mortgage
Surveillance Group,
or such other address as Fitch may hereafter furnish to the
Depositor and the
Master Servicer.
FNMA: The Federal National Mortgage Association, a federally
chartered
and privately owned corporation organized and existing under the
Federal
National Mortgage Association Charter Act, or any successor to
the Federal
National Mortgage Association.
Gross Margin: With respect to each Mortgage Loan, the fixed
percentage
set forth in the related Mortgage Note that is added to the
Mortgage Index on
each Adjustment Date in accordance with the terms of the related
Mortgage Note
used to determine the Mortgage Rate for such Mortgage Loan.
Group 1 Senior Certificates: As specified in the Preliminary
Statement.
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Group 2 Senior Certificates: As specified in the Preliminary
Statement.
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).
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 any Distribution Date,
the
calendar month prior to the month of such Distribution Date.
Latest Possible Maturity Date: The Distribution Date following
the third
anniversary of the scheduled maturity date of the Mortgage Loan
having the
latest scheduled maturity date as of the Cut-off Date.
Lender PMI Mortgage Loan: Certain Mortgage Loans as to which the
lender
(rather than the Mortgagor) acquires the Primary Insurance
Policy and charges
the related Mortgagor an interest premium.
LIBOR: The London interbank offered rate for one-month United
States
dollar deposits calculated in the manner described in Section
4.08.
LIBOR Certificates: As specified in the Preliminary
Statement.
Liquidated Mortgage Loan: With respect to any Distribution Date,
a
defaulted Mortgage Loan (including any REO Property) that was
liquidated in
the calendar month preceding the month of such Distribution Date
and as to
which the Master Servicer has determined (in accordance with
this Agreement)
that it has received all amounts it expects to receive in
connection with the
liquidation of such Mortgage Loan, including the final
disposition of an REO
Property.
Liquidation Proceeds: Amounts, including Insurance Proceeds,
received in
connection with the partial or complete liquidation of defaulted
Mortgage
Loans, whether through trustee's sale, foreclosure sale or
otherwise or
amounts received in connection with any condemnation or partial
release of a
Mortgaged Property and any other proceeds received in connection
with an REO
Property, less the sum of related unreimbursed Master Servicing
Fees,
Servicing Advances and Advances.
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<PAGE>
Loan Group: Any of Loan Group 1 and Loan Group 2, as
applicable.
Loan Group 1: All Mortgage Loans identified as Loan Group 1
Mortgage
Loans on the Mortgage Loan Schedule.
Loan Group 2: All Mortgage Loans identified as Loan Group 2
Mortgage
Loans on the Mortgage Loan Schedule.
Loan-to-Value Ratio: With respect to any Mortgage Loan and as to
any date
of determination, the fraction (expressed as a percentage) the
numerator of
which is the principal balance of the related Mortgage Loan at
that date of
determination and the denominator of which is the Appraised
Value of the
related Mortgaged Property.
Lost Mortgage Note: Any Mortgage Note the original of which
was
permanently lost or destroyed and has not been replaced.
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 Servicer: Countrywide Servicing, 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 Servicer Remittance Date: The 19th day of each calendar
month, or
if such 19th day is not a Business Day, the next succeeding
Business Day,
commencing in April 2005.
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 of such Distribution Date (prior to giving
effect to any
Scheduled Payments due on such Mortgage Loan on such Due Date),
subject to
reduction as provided in Section 3.14.
Master Servicing Fee Rate: With respect to each Mortgage Loan
and Due
Date, the amount set forth in the Mortgage Loan Schedule for
such Due Date.
Maximum Mortgage Rate: With respect to each Mortgage Loan, the
percentage
set forth in the related Mortgage Note as the maximum Mortgage
Rate
thereunder.
MERS: Mortgage Electronic Registration Systems, Inc., a
corporation
organized and existing under the laws of the State of Delaware,
or any
successor to Mortgage Electronic Registration Systems, Inc.
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<PAGE>
MERS Mortgage Loan: Any Mortgage Loan registered with MERS on
the MERS(R)
System.
MERS(R) System: The system of recording transfers of
mortgages
electronically maintained by MERS.
MIN: The mortgage identification number for any MERS Mortgage
Loan.
Minimum Mortgage Rate: With respect to each Mortgage Loan, the
greater of
(a) the Gross Margin set forth in the related Mortgage Note and
(b) the
percentage set forth in the related Mortgage Note as the minimum
Mortgage Rate
thereunder.
MOM Loan: Any Mortgage Loan as to which MERS is acting as
mortgagee,
solely as nominee for the originator of such Mortgage Loan and
its successors
and assigns.
Monthly Statement: The statement delivered to the
Certificateholders
pursuant to Section 4.06.
Moody's: Moody's Investors Service, Inc., or any successor
thereto. If
Moody's is designated as a Rating Agency in the Preliminary
Statement, for
purposes of Section 10.05(b) the address for notices to Moody's
shall be
Moody's Investors Service, Inc., 99 Church Street, New York, New
York 10007,
Attention: Residential Pass-Through Monitoring, or such other
address as
Moody's may hereafter furnish to the Depositor or the Master
Servicer.
Mortgage: The mortgage, deed of trust or other instrument
creating a
first lien on an estate in fee simple or leasehold interest in
real property
securing a Mortgage Note.
Mortgage File: The mortgage documents listed in Section 2.01
pertaining
to a particular Mortgage Loan and any additional documents
delivered to the
Trustee to be added to the Mortgage File pursuant to this
Agreement.
Mortgage Index: As to each Mortgage Loan, the index from time to
time in
effect for adjustment of the Mortgage Rate as set forth as such
on the related
Mortgage Note.
Mortgage Loan Schedule: The list of Mortgage Loans (as from time
to time
amended by the Master Servicer to reflect the addition of
Substitute Mortgage
Loans, and the deletion of Deleted Mortgage Loans pursuant to
the provisions
of this Agreement) transferred to the Trustee as part of the
Trust Fund and
from time to time subject to this Agreement, attached to this
Agreement as
Schedule I, setting forth the following information with respect
to each
Mortgage Loan 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;
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<PAGE>
(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 or attached single family dwelling, (b) a dwelling in
a
de minimis PUD, (c) a condominium unit or PUD (other than a
de
minimis PUD), (d) a two- to four-unit residential property or
(e) a
Cooperative Unit;
(xi) the Mortgage Rate in effect as of the Cut-off Date;
(xii) the Master Servicing Fee Rate both before and after
the
initial Adjustment Date for each Mortgage Loan;
(xiii) a code indicating whether the Mortgage Loan is a Lender
PMI
Mortgage Loan and, in the case of any Lender PMI Mortgage Loan,
a
percentage representing the amount of the related interest
premium
charged to the borrower;
(xiv) the purpose for the Mortgage Loan;
(xv) the type of documentation program pursuant to which the
Mortgage Loan was originated;
(xvi) the direct servicer of such Mortgage Loan as of the
Cut-off
Date;
(xvii) a code indicating whether the Mortgage Loan is a MERS
Mortgage Loan;
(xviii)a code indicating whether the Mortgage Loan is a
Countrywide
Mortgage Loan, a Park Granada Mortgage Loan or a Park Sienna
Mortgage Loan; and
(xix) with respect to each Mortgage Loan, the Gross Margin,
the
Mortgage Index, the Maximum Mortgage Rate, the Minimum
Mortgage
Rate, the Periodic Rate Cap and the first Adjustment Date for
such
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.
Mortgage Loans: Such of the mortgage loans transferred and
assigned to
the Trustee pursuant to the provisions of this Agreement as from
time to time
are held as a part of the Trust Fund (including any REO
Property), the
mortgage loans so held being identified in the Mortgage
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<PAGE>
Loan Schedule, notwithstanding foreclosure or other acquisition
of title of
the related Mortgaged Property.
Mortgage Note: The original executed note or other evidence
of
indebtedness evidencing the indebtedness of a Mortgagor under a
Mortgage Loan.
Mortgage 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 Prepayment Interest
Shortfalls for
such Loan Group during the related Prepayment Period 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 that Distribution Date over the
Prepayment Interest
Shortfalls experienced by the Mortgage Loans in such other Loan
Group during
such Prepayment Period.
Non-Delay Certificates: As specified in the Preliminary
Statement.
Nonrecoverable Advance: Any portion of an Advance previously
made or
proposed to be made by the Master Servicer that, in the good
faith judgment of
the Master Servicer, will not be ultimately recoverable by the
Master Servicer
from the related Mortgagor, related Liquidation Proceeds or
otherwise.
Notice of Final Distribution: The notice to be provided pursuant
to
Section 9.02 to the effect that final distribution on any of the
Certificates
shall be made only upon presentation and surrender thereof.
Notional Amount: For the Class 1-A-IO Certificates an amount
equal to (i)
for any date prior to and including the last day of the Interest
Accrual
Period for the Distribution Date in January 2008, the sum of the
Component
Notional Amounts of the Class 1-A-1-IO, Class 1-A-2-IO, Class
1-A-3-IO and
Class 1-A-4-IO Components on such date and (ii) after the last
day of the
Interest Accrual Period for the Distribution Date in January
2008, $0. For the
Class 2-A-IO Certificates an amount equal to (i) for any date
prior to and
including the last day of the Interest Accrual Period for the
Distribution
Date in January 2010, the Class Certificate Balance of the Class
2-A
Certificates on such date and (ii) after the last day of the
Interest Accrual
Period for the Distribution Date in January 2010, $0.
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<PAGE>
Notional Amount Certificates: As specified in the Preliminary
Statement.
Offered Certificates: As specified in the Preliminary
Statement.
Officer's Certificate: A certificate signed by (i) in the case
of the
Depositor, 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, by the President, an Executive Vice
President, a
Vice President, an Assistant Vice President, the Treasurer, or
one of the
Assistant Treasurers or Assistant Secretaries of Countrywide GP,
Inc. (its
general partner) or (iii) if provided for in this Agreement, 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.
Opinion of Counsel: A written opinion of counsel, who may be
counsel for
the Depositor, a Seller 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 the Depositor, a Seller and the
Master Servicer,
(ii) not have any direct financial interest in the Depositor, a
Seller or the
Master Servicer or in any affiliate of either, and (iii) not be
connected with
the Depositor, a Seller 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 under
this
Agreement in connection with the purchase of the Mortgage Loans
pursuant to
Section 9.01.
Original Applicable Credit Support Percentage: With respect to
each of
the following Classes of Subordinated Certificates, the
corresponding
percentage described below, as of the Closing Date:
Class M 7.30%
Class B-1 3.25%
Class B-2 2.25%
Class B-3 1.50%
Class B-4 0.90%
Class B-5 0.30%
Original Mortgage Loan: The mortgage loan refinanced in
connection with
the origination of a Refinancing Mortgage Loan.
Original Subordinate Principal Balance: On or prior to the first
Senior
Termination Date, the Subordinated Percentage for a Loan Group
of the
aggregate Stated Principal Balances of the Mortgage Loans in
such Loan Group,
in each case as of the Cut-off Date or, if such date is after
the first Senior
Termination Date, the aggregate of the Class Certificate
Balances of the
Subordinated Certificates as of the Closing Date.
OTS: The Office of Thrift Supervision.
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<PAGE>
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 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.
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 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.
Periodic Rate Cap: With respect to each Mortgage Loan and any
Adjustment
Date therefor, the fixed percentage set forth in the related
Mortgage Note,
which is the maximum amount by which the Mortgage Rate for such
Mortgage Loan
may increase or decrease (without regard to the Maximum Mortgage
Rate or the
Minimum Mortgage Rate) on such Adjustment Date from the Mortgage
Rate in
effect immediately prior to such Adjustment Date.
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<PAGE>
Permitted Investments: At any time, any one or more of the
following
obligations and securities:
(i) obligations of the United States or any agency thereof,
provided
such obligations are backed by the full faith and credit of
the
United States;
(ii) general obligations of or obligations guaranteed by any
state
of the United States or the District of Columbia receiving
the
highest long-term debt rating of each Rating Agency, or such
lower
rating as will not result in the downgrading or withdrawal of
the
ratings then assigned to the Certificates by each Rating
Agency;
(iii) commercial or finance company paper which is then
receiving
the highest commercial or finance company paper rating of
each
Rating Agency, or such lower rating as will not result in
the
downgrading or withdrawal of the ratings then assigned to
the
Certificates by each Rating Agency;
(iv) certificates of deposit, demand or time deposits, or
bankers'
acceptances issued by any depository institution or trust
company
incorporated under the laws of the United States or of any
state
thereof and subject to supervision and examination by federal
and/or
state banking authorities, provided that the commercial paper
and/or
long term unsecured debt obligations of such depository
institution
or trust company (or in the case of the principal depository
institution in a holding company system, the commercial paper
or
long-term unsecured debt obligations of such holding company,
but
only if Moody's is not a Rating Agency) are then rated one of
the
two highest long-term and the highest short-term ratings of
each
Rating Agency for such securities, or such lower ratings as will
not
result in the downgrading or withdrawal of the rating then
assigned
to the Certificates by either Rating Agency;
(v) repurchase obligations with respect to any security
described in
clauses (i) and (ii) above, in either case entered into with
a
depository institution or trust company (acting as
principal)
described in clause (iv) above;
(vi) units of a taxable money-market portfolio having the
highest
rating assigned by each Rating Agency (except if Fitch is a
Rating
Agency and has not rated the portfolio, the highest rating
assigned
by Moody's) and restricted to obligations issued or guaranteed
by
the United States of America or entities whose obligations
are
backed by the full faith and credit of the United States of
America
and repurchase agreements collateralized by such obligations;
and
(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
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<PAGE>
provided, that no such instrument shall be a Permitted
Investment if such
instrument evidences the right to receive interest only payments
with respect
to the obligations underlying such instrument.
Permitted Transferee: Any person other than (i) the United
States, any
State or political subdivision thereof, or any agency or
instrumentality of
any of the foregoing, (ii) a foreign government, International
Organization or
any agency or instrumentality of either of the foregoing, (iii)
an
organization (except certain farmers' cooperatives described in
section 521 of
the Code) which is exempt from tax imposed by Chapter 1 of the
Code (including
the tax imposed by section 511 of the Code on unrelated business
taxable
income) on any excess inclusions (as defined in section
860E(c)(1) of the
Code) with respect to any Residual Certificate, (iv) rural
electric and
telephone cooperatives described in section 1381(a)(2)(C) of the
Code, (v) an
"electing large partnership" as defined in section 775 of the
Code, (vi) a
Person that is not a citizen or resident of the United States, a
corporation,
partnership, or other entity created or organized in or under
the laws of the
United States, any state thereof or the District of Columbia, or
an estate or
trust whose income from sources without the United States is
includible in
gross income for United States federal income tax purposes
regardless of its
connection with the conduct of a trade or business within the
United States or
a trust if a court within the United States is able to exercise
primary
supervision over the administration of the trust and one or more
United States
persons have the authority to control all substantial decisions
of the trust
unless such Person has furnished the transferor and the Trustee
with a duly
completed Internal Revenue Service Form W-8ECI or any applicable
successor
form, and (vii) any other Person so designated by the Depositor
based upon an
Opinion of Counsel that the Transfer of an Ownership Interest in
a Residual
Certificate to such Person may cause any REMIC created under
this Agreement to
fail to qualify as a REMIC at any time that the Certificates are
outstanding.
The terms "United States," "State" and "International
Organization" shall have
the meanings set forth in section 7701 of the Code or successor
provisions. A
corporation will not be treated as an instrumentality of the
United States or
of any State or political subdivision thereof for these purposes
if all of its
activities are subject to tax and, with the exception of the
Federal Home Loan
Mortgage Corporation, a majority of its board of directors is
not selected by
such government unit.
Person: Any individual, corporation, partnership, joint
venture,
association, limited liability company, joint-stock company,
trust,
unincorporated organization or government, or any agency or
political
subdivision thereof.
Physical Certificate: As specified in the Preliminary
Statement.
Planned Balance: With respect to any Planned Principal Class or
Component
and any Distribution Date appearing in Schedule V, the amount
appearing
opposite such Distribution Date for such Class or Component.
Planned Principal Classes: As specified in the Preliminary
Statement.
Planned Principal Components: As specified in the Preliminary
Statement.
Pool Stated Principal Balance: As to any Distribution Date, the
aggregate
of the Stated Principal Balances of the Mortgage Loans that were
Outstanding
Mortgage Loans on the Due Date in the month preceding the month
of such
Distribution Date and, as to any other date of
18
<PAGE>
determination, the aggregate of the Stated Principal Balances of
the
Outstanding Mortgage Loans as of such date.
Prepayment Interest Shortfall: As to any Distribution Date, any
Mortgage
Loan and any Principal Prepayment received during the related
Prepayment
Period, the amount, if any, by which one month's interest at the
related
Mortgage Rate, net of the related Master Servicing Fee Rate, on
such Principal
Prepayment exceeds the amount of interest paid in connection
with such
Principal Prepayment.
Prepayment Period: As to any Distribution Date and Mortgage
Loan, the
calendar month immediately preceding the month in which that
Distribution Date
occurs.
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 Amount: As to any Distribution Date and any Loan
Group, the sum
of (a) the principal portion of each Scheduled Payment (without
giving effect
to any reductions thereof caused by any Debt Service Reductions
or Deficient
Valuations) due on each Mortgage Loan (other than a Liquidated
Mortgage Loan)
in such Loan Group on the related Due Date, (b) the principal
portion of the
Purchase Price of each Mortgage Loan in such 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 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 such 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 Proceeds allocable to principal received
during the
calendar month preceding the month of such Distribution Date
with respect to
such Mortgage Loan, (f) all Principal Prepayments for such Loan
Group received
during the related Prepayment Period (g) any Transfer Payments
Received for
such Loan Group, minus any Transfer Payments Made for such Loan
Group and
Distribution Date in accordance with Section 4.05 and (h) any
Subsequent
Recoveries on the Mortgage Loans in such Loan Group received
during the
calendar month preceding the month of such Distribution
Date.
Principal Prepayment: Any payment of principal by a Mortgagor on
a
Mortgage Loan that is received in advance of its scheduled Due
Date and is not
accompanied by an amount representing scheduled interest due on
any date or
dates in any month or months subsequent to
19
<PAGE>
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 a
Lower
Tier REMIC Regular Interest other than a Regular Interest
corresponding to
that Loan Group as provided in the Preliminary Statement.
Principal Relocation
Payments from a Loan Group shall be made of the amounts in
respect of
principal from the Mortgage Loans of the Loan Group and shall
include a
proportionate allocation of the Realized Losses from the
Mortgage Loans of the
Loan Group.
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.
Pro Rata Subordinated Percentage: As to any Distribution Date
and Loan
Group, 100% minus the related Senior Percentage for such
Distribution Date.
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 February 9, 2005 generally
relating to
mortgage-pass through certificates to be sold by the
Depositor.
Prospectus Supplement: The Prospectus Supplement dated March 24,
2005
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 of this
Agreement 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 of this
Agreement that
arises out of a violation of any predatory or abusive lending
law with respect
to the related Mortgage Loan.
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<PAGE>
Qualified Insurer: A mortgage guaranty insurance company duly
qualified
as such under the laws of the state of its principal place of
business and
each state having jurisdiction over such insurer in connection
with the
insurance policy issued by such insurer, duly authorized and
licensed in such
states to transact a mortgage guaranty insurance business in
such states and
to write the insurance provided by the insurance policy issued
by it, approved
as a FNMA-approved mortgage insurer and having a claims paying
ability rating
of at least "AA" or equivalent rating by a nationally recognized
statistical
rating organization. Any replacement insurer with respect to a
Mortgage Loan
must have at least as high a claims paying ability rating as the
insurer it
replaces had on the Closing Date.
Rating Agency: Each of the Rating Agencies specified in the
Preliminary
Statement. If any such organization or a successor is no longer
in existence,
"Rating Agency" shall be such nationally recognized statistical
rating
organization, or other comparable Person, as is designated by
the Depositor,
notice of which designation shall be given to the Trustee.
References in this
Agreement to a given rating category of a Rating Agency shall
mean such rating
category without giving effect to any modifiers.
Realized Loss: With respect to each Liquidated Mortgage Loan, an
amount
(not less than zero or more than the Stated Principal Balance of
the Mortgage
Loan) as of the date of such liquidation, equal to (i) the
Stated Principal
Balance of the Liquidated Mortgage Loan as of the date of such
liquidation,
plus (ii) interest at the Adjusted Net Mortgage Rate from the
Due Date as to
which interest was last paid or advanced (and not reimbursed)
to
Certificateholders up to the Due Date in the month in which
Liquidation
Proceeds are required to be distributed on the Stated Principal
Balance of
such Liquidated Mortgage Loan from time to time, minus (iii) the
Liquidation
Proceeds, if any, received during the month in which such
liquidation
occurred, to the extent applied as recoveries of interest at the
Adjusted Net
Mortgage Rate and to principal of the Liquidated Mortgage Loan.
With respect
to each Mortgage Loan that has become the subject of a Deficient
Valuation, if
the principal amount due under the related Mortgage Note has
been reduced, the
difference between the principal balance of the Mortgage Loan
outstanding
immediately prior to such Deficient Valuation and the principal
balance of the
Mortgage Loan as reduced by the Deficient Valuation. With
respect to each
Mortgage Loan that has become the subject of a Debt Service
Reduction and any
Distribution Date, the amount, if any, by which the principal
portion of the
related Scheduled Payment has been reduced.
To the extent the Master Servicer receives Subsequent Recoveries
with
respect to any Mortgage Loan, the amount of Realized Losses with
respect to
that Mortgage Loan will be reduced by the amount of those
Subsequent
Recoveries.
Recognition Agreement: With respect to any Cooperative Loan, an
agreement
between the Cooperative Corporation and the originator of such
Mortgage Loan
which establishes the rights of such originator in the
Cooperative Property.
Record Date: With respect to any Distribution Date, the close of
business
on the last Business Day of the month preceding the month in
which such
Distribution Date occurs.
Refinancing Mortgage Loan: Any Mortgage Loan originated in
connection
with the refinancing of an existing mortgage loan.
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<PAGE>
Regular Certificates: As specified in the Preliminary
Statement.
Relief Act: The Servicemembers Civil Relief Act.
Relief Act Reductions: With respect to any Distribution Date and
any
Mortgage Loan as to which there has been a reduction in the
amount of interest
collectible thereon for the most recently ended calendar month
as a result of
the application of the Relief Act, 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.
Request for Release: The Request for Release submitted by the
Master
Servicer to the Trustee, substantially in the form of Exhibits M
and N to this
Agreement, as appropriate.
Required Insurance Policy: With respect to any Mortgage Loan,
any
insurance policy that is required to be maintained from time to
time under
this Agreement.
Residual Certificates: As specified in the Preliminary
Statement.
Responsible Officer: When used with respect to the Trustee, any
Vice
President, any Assistant Vice President, the Secretary, any
Assistant
Secretary, any Trust Officer or any other officer of the Trustee
customarily
performing functions similar to those performed by any of the
above designated
officers and also to whom, with respect to a particular matter,
such matter is
referred because of such officer's knowledge of and familiarity
with the
particular subject.
Restricted Classes: As defined in Section 4.02(e).
Scheduled Payment: The scheduled monthly payment on a Mortgage
Loan due
on any Due Date allocable to principal and/or interest on such
Mortgage Loan
which, unless otherwise specified in this Agreement, shall give
effect to any
related Debt Service Reduction and any Deficient Valuation that
affects the
amount of the monthly payment due on such Mortgage Loan.
Securities Act: The Securities Act of 1933, as amended.
22
<PAGE>
Seller: Countrywide, Park Granada or Park Sienna, as
applicable.
Senior Certificates: As specified in the Preliminary
Statement.
Senior Certificate Group: 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 the numerator of
which is the
aggregate of the Class Certificate Balances of each Class of
Senior
Certificates of such Senior Certificate Group (other than the
Notional Amount
Certificates) immediately prior to such Distribution Date and
the denominator
of which is the aggregate of the Stated Principal Balance of
each Mortgage
Loan in the related Loan Group as of the Due Date in the month
preceding the
month of such Distribution Date; provided, however, that on any
Distribution
Date after the first Senior Termination Date, the Senior
Percentage for the
Senior Certificates of the remaining Senior Certificate Group is
the
percentage equivalent of a fraction, the numerator of which is
the aggregate
of the Class Certificate Balances of each such Class of Senior
Certificates
(other than the Notional Amount Certificates) immediately prior
to such
Distribution Date and the denominator of which is the aggregate
of the Class
Certificate Balances of all Classes of Certificates (other than
the Notional
Amount Certificates) immediately prior to such Distribution
Date. In no event
will any Senior Percentage be greater than 100%.
Senior Prepayment Percentage: As to a Senior Certificate Group
and any
Distribution Date during the ten years beginning on the first
Distribution
Date, 100%. The related Senior Prepayment Percentage for any
Distribution Date
occurring on or after the tenth anniversary of the first
Distribution Date
will, except as provided in this Agreement, 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 related Senior Percentage exceeds
the Senior
Percentage of such Senior Certificate Group as of the Closing
Date, in which
case the related Senior Prepayment Percentage for such
Distribution Date will
once again equal 100%). Notwithstanding the foregoing, no
decrease in the
related Senior Prepayment Percentage will occur unless both of
the Senior Step
Down Conditions are satisfied with respect to all Loan Groups.
Notwithstanding
the foregoing, if the Two Times Test is satisfied on a
Distribution Date, the
Senior Prepayment Percentage for each Senior Certificate Group
will equal (x)
if such Distribution Date is on or prior to the Distribution
Date in March
2008, the related Senior Percentage for such Distribution Date
plus 50% of the
related Subordinated Percentage for that Distribution Date and
(y) if such
Distribution Date is after the Distribution Date in March 2008,
the related
Senior Percentage.
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<PAGE>
Senior Principal Distribution Amount: As to any Distribution
Date and
Senior Certificate Group, the sum of (i) the related Senior
Percentage of all
amounts described in clauses (a) through (d) of the definition
of "Principal
Amount" with respect to the related Loan Group for such
Distribution Date,
(ii) with respect to any Mortgage Loan in the related Loan Group
that
became a Liquidated Mortgage Loan during the calendar month
preceding the
month of such Distribution Date, the lesser of (x) the related
Senior
Percentage of the Stated Principal Balance of such Mortgage Loan
as of the Due
Date in the month preceding the month of that Distribution Date
and (y) the
related Senior Prepayment Percentage of the amount of the
Liquidation Proceeds
allocable to principal received on the Mortgage Loan, (iii) the
related Senior
Prepayment Percentage of the amounts described in clauses (f)
and (h) of the
definition of "Principal Amount" with respect to the related
Loan Group for
such Distribution Date; (iv) the principal portion of any
Transfer Payments
Received for that Loan Group and Distribution Date; provided,
however, on any
Distribution Date after the first 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,
as opposed to the Mortgage Loans in the related Loan Group.
Senior Step Down Conditions: With respect to all the Mortgage
Loans: (i)
the aggregate Stated Principal Balance of all Mortgage Loans in
a Loan Group
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 the
aggregate Class Certificate Balance of the Subordinated
Certificates, does not
equal or exceed 50%, and (ii) cumulative Realized Losses on all
the Mortgage
Loans do not exceed: (a) commencing with the Distribution Date
on the tenth
anniversary of the first Distribution Date, 30% of the Original
Subordinate
Principal Balance, (b) commencing with the Distribution Date on
the eleventh
anniversary of the first Distribution Date, 35% of the Original
Subordinate
Principal Balance, (c) commencing with the Distribution Date on
the twelfth
anniversary of the first Distribution Date, 40% of the Original
Subordinate
Principal Balance, (d) commencing the Distribution Date on the
thirteenth
anniversary of the first Distribution Date, 45% of the Original
Subordinate
Principal Balance and (e) commencing with the Distribution Date
on the
fourteenth anniversary of the first Distribution Date, 50% of
the Original
Subordinate Principal Balance.
Senior Termination Date: For each Senior Certificate Group,
the
Distribution Date on which the aggregate Class Certificate
Balance of the
related Classes of Senior Certificates have been reduced to
zero.
Servicing Advances: All customary, reasonable and necessary "out
of
pocket" costs and expenses incurred in the performance by the
Master Servicer
of its servicing obligations, including, but not limited to, the
cost of (i)
the preservation, restoration and protection of a Mortgaged
Property, (ii) any
expenses reimbursable to the Master Servicer pursuant to Section
3.11 and any
enforcement or judicial proceedings, including foreclosures,
(iii) the
management and liquidation of any REO Property and (iv)
compliance with the
obligations under Section 3.09.
Servicing 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.
S&P: Standard & Poor's Ratings Services, a division of
The McGraw-Hill
Companies, Inc. If S&P is designated as a Rating Agency in
the Preliminary
Statement, for purposes of
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<PAGE>
Section 10.05(b) the address for notices to S&P shall be
Standard & Poor's
Ratings Services, 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.
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) after giving effect to any
previous partial
Principal Prepayments and Liquidation Proceeds received and
allocable to
principal (other than with respect to any Liquidated Mortgage
Loan) and to the
payment of principal due on such Due Date and irrespective of
any delinquency
in payment by the related Mortgagor.
Streamlined Documentation Mortgage Loan: Any Mortgage Loan
originated
pursuant to Countrywide Home Loan Inc.'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.
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 Weighted Average
Adjusted Net
Mortgage Rate of the related Mortgage Loans 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.
Subordinated Certificates: As specified in the Preliminary
Statement.
Subordinated Percentage: As to any Distribution Date on or prior
to the
first Senior Termination Date and Loan Group, 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 the first
Senior
Termination Date, 100% minus the Senior Percentage for such
Distribution Date.
Subordinated Portion: For any Distribution Date and Loan Group,
an amount
equal to the aggregate Stated Principal Balance of the Mortgage
Loans in that
Loan Group as of the Due Date in the month prior to the month of
such
Distribution Date, minus the aggregate Class Certificate Balance
of the
related Senior Certificates immediately prior to such
Distribution Date.
Subordinated Prepayment Percentage: As to any Distribution Date
and Loan
Group, 100% minus the related Senior Prepayment Percentage for
such
Distribution Date.
Subordinated Principal Distribution Amount: With respect to
any
Distribution Date and Loan Group, an amount equal to the excess
of (A) the
sum, not less than zero, of the sum of (i) the Subordinated
Percentage of all
amounts described in clauses (a) through (d) of the definition
of "Principal
Amount" for that Loan Group and that Distribution Date, (ii)
with respect to
each
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<PAGE>
Mortgage Loan in that Loan Group that became a Liquidated
Mortgage Loan during
the calendar month preceding the month of such Distribution
Date, 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 Stated Principal Balance of that
Mortgage Loan, and
(iii) the sum of the Subordinated Prepayment Percentage for that
Loan Group of
all amounts described in clauses (f) and (h) of the definition
of "Principal
Amount" for such Loan Group and Distribution Date over (B) the
principal
portion of any Transfer Payments Made for such Loan Group;
provided, however,
that on any Distribution Date after the first 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 and
Subordinated
Prepayment Percentage for the Subordinated Certificates for such
Distribution
Date with respect to all of the Mortgage Loans as opposed to the
Mortgage
Loans only in the related Loan Group.
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.
Substitute Mortgage Loan: A Mortgage Loan substituted by the
applicable
Seller for a Deleted Mortgage Loan which must, on the date of
such
substitution, as confirmed in a Request for Release,
substantially in the form
of Exhibit M, (i) have a Stated Principal Balance, after
deduction of the
principal portion of the Scheduled Payment due in the month of
substitution,
not in excess of, and not more than 10% less than the Stated
Principal Balance
of the Deleted Mortgage Loan; (ii) be accruing interest at a
rate no lower
than and not more than 1% per annum higher than, that of the
Deleted Mortgage
Loan; (iii) have a Loan-to-Value Ratio no higher than that of
the Deleted
Mortgage Loan; (iv) have a remaining term to maturity no greater
than (and not
more than one year less than that of) the Deleted Mortgage Loan;
(v) have a
Maximum Mortgage Rate not more than 1% per annum higher or lower
than, that of
the Deleted Mortgage Loan; (vi) have a Minimum Mortgage Rate
specified in its
related mortgage note not more than 1% per annum higher or lower
than the
Minimum Mortgage Rate of the Deleted Mortgage Loan; (vii) have
the same
Mortgage Index, Mortgage Index reset period and Periodic Rate
Cap as the
Deleted Mortgage Loan and a Gross Margin not more than 1% per
annum higher or
lower than that of the Deleted Mortgage Loan; (viii) not be a
Cooperative Loan
unless the Deleted Mortgage Loan was a Cooperative Loan; and
(ix) comply with
each representation and warranty set forth in Section 2.03.
Substitution Adjustment Amount: The meaning ascribed to such
term
pursuant to Section 2.03.
Tax Matters Person: The person designated as "tax matters
person" in the
manner provided under Treasury regulation ss. 1.860F-4(d) and
temporary
Treasury regulation ss. 301.6231(a)(7)1T. Initially, the Tax
Matters Person
shall be the Trustee.
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<PAGE>
Tax Matters Person Certificate: The Class A-R Certificate with
a
Denomination of $0.01.
Transfer: Any direct or indirect transfer or sale of any
Ownership
Interest in a Residual Certificate.
Transfer Payment Made: As defined in Section 4.05.
Transfer Payment Received: As defined in Section 4.05.
Trust Fund: The corpus of the trust created under this
Agreement
consisting of (i) the Mortgage Loans and all interest and
principal received
on or with respect thereto after the Cut-off Date to the extent
not applied in
computing the Cut-off Date Principal Balance of the Mortgage
Loans; (ii) the
Certificate Account and the Distribution Account and all amounts
deposited
therein pursuant to the applicable provisions of this Agreement;
(iii)
property that secured a Mortgage Loan and has been acquired by
foreclosure,
deed-in-lieu of foreclosure or otherwise; and (iv) all proceeds
of the
conversion, voluntary or involuntary, of any of the
foregoing.
Trustee: The Bank of New York and its successors and, if a
successor
trustee is appointed under this Agreement, such successor.
Trustee Advance Rate: With respect to any Advance made by the
Trustee
pursuant to Section 4.01(b), a per annum rate of interest
determined as of the
date of such Advance equal to the Prime Rate in effect on such
date plus
5.00%.
Trustee Fee: As to any Distribution Date, an amount equal to
one-twelfth
of the Trustee Fee Rate multiplied by the Pool Stated Principal
Balance with
respect to such Distribution Date.
Trustee Fee Rate: With respect to each Mortgage Loan, the per
annum rate
agreed upon in writing on or prior to the Closing Date by the
Trustee and the
Depositor.
Two Times Test: As to any Distribution Date, if (i) the
Aggregate
Subordinated Percentage is at least 200% of the Aggregate
Subordinated
Percentage as of the Closing Date, (ii) the outstanding
aggregate Stated
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 the aggregate Class Certificate Balance of the
Subordinated
Certificates, does not equal or exceed 50% and (iii) the
cumulative Realized
Losses on all the Mortgage Loans do not exceed (x) with respect
to any
Distribution Date on or prior to March 2008, 20% of the
aggregate Class
Certificate Balance of the Subordinated Certificates as of the
Closing Date or
(y) with respect to any Distribution Date after March 2008, 30%
of the
aggregate Class Certificate Balance of the Subordinated
Certificates as of the
Closing Date.
Undercollateralized Group: As defined in Section 4.05.
27
<PAGE>
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.
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.
Weighted Average Adjusted Net Mortgage Rate: For each Loan
Group, the
average of the Adjusted Net Mortgage Rate of each Mortgage Loan
in that Loan
Group, weighted on the basis of its Stated Principal
Balance.
Weighted Average Component Rate: For each Interest Accrual
Period for any
Distribution Date, a per annum rate equal to the average of the
Component
Rates of the Class 1-A-1-IO, Class 1-A-2-IO, Class 1-A-3-IO and
Class 1-A-4-IO
Components, weighted on the basis of their respective Component
Notional
Amounts as of the last day of the related Interest Accrual
Period.
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ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
SECTION 2.01. Conveyance of Mortgage Loans
(a) Each Seller, concurrently with the execution and delivery of
this
Agreement, hereby sells, transfers, assigns, sets over and
otherwise conveys
to the Depositor, without recourse, all its respective right,
title and
interest in and to the related Mortgage Loans, including all
interest and
principal received or receivable by such Seller, on or with
respect to the
applicable Mortgage Loans after the Cut-off Date and all
interest and
principal payments on the related Mortgage Loans received prior
to the Cut-off
Date in respect of installments of interest and principal due
thereafter, but
not including payments of principal and interest due and payable
on such
Mortgage Loans on or before the Cut-off Date. On or prior to the
Closing Date,
Countrywide shall deliver to the Depositor or, at the
Depositor's direction,
to the Trustee or other designee of the Depositor, the Mortgage
File for each
Mortgage Loan listed in the Mortgage Loan Schedule (except that,
in the case
of the Delay Delivery Mortgage Loans (which may include
Countrywide Mortgage
Loans, Park Granada Mortgage Loans 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 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 in this
Agreement by such
Seller or to repurchase or substitute for any affected Mortgage
Loan in
accordance herewith.
(c) In connection with the transfer and assignment set forth in
clause
(b) above, the Depositor has delivered or caused to be delivered
to the
Trustee (or, in the case of the Delay Delivery Mortgage Loans,
will deliver or
cause to be delivered to the Trustee) within thirty (30) days
following the
Closing Date for the benefit of the Certificateholders the
following documents
or instruments with respect to each Mortgage Loan so
assigned:
(i) (A) the original Mortgage Note endorsed by manual or
facsimile signature in blank in the following form: "Pay to
the
order of ____________ without recourse," with all
intervening
endorsements showing a complete chain of endorsement from
the
originator to the Person endorsing the Mortgage Note (each
such
endorsement being sufficient to transfer all right, title
and
interest of the party so endorsing, as noteholder or
assignee
thereof, in and to that Mortgage Note); or
29
<PAGE>
(B) with respect to any Lost Mortgage Note, a lost note
affidavit from Countrywide stating that the original
Mortgage
Note was lost or destroyed, together with a copy of such
Mortgage Note;
(ii) except as provided below and for each Mortgage Loan
that
is not a MERS Mortgage Loan, the original recorded Mortgage or
a
copy of such Mortgage 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, 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 (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;
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<PAGE>
(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).
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,
(b) all interim recorded assignments or (c) 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 such interim
assignment, 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
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<PAGE>
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 thirty (30) days after such transfer
and assignment,
the Trustee shall (i) as the assignee thereof, affix the
following language to
each assignment of Mortgage: "CWMBS Series 2005-HYB2, The Bank
of New York as
trustee", (ii) cause such assignment to be in proper form for
recording in the
appropriate public office for real property records and (iii)
cause to be
delivered for recording in the appropriate public office for
real property
records the assignments of the Mortgages to the Trustee, except
that, with
respect to any 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 that the
Trustee need not cause to be recorded any assignment which
relates to a
Mortgage Loan (a) the Mortgaged Property and Mortgage File
relating to which
are located in California or (b) in any other jurisdiction
(including Puerto
Rico) under the laws of which in the opinion of counsel the
recordation of
such assignment is not necessary to protect the Trustee's and
the
Certificateholders' interest in the related Mortgage Loan.
In the case of Mortgage Loans that have been prepaid in full as
of the
Closing Date, the Depositor, in lieu of delivering the above
documents to the
Trustee, will deposit in the Certificate Account the portion of
such payment
that is required to be deposited in the Certificate Account
pursuant to
Section 3.05.
Notwithstanding anything to the contrary in this Agreement,
within thirty
(30) days after the Closing Date with respect to the Mortgage
Loans,
Countrywide (on its own behalf and on behalf of Park Granada 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 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 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
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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
clauses (49) and (50) of Schedule III-A hereto.
SECTION 2.02. Acceptance by Trustee of the Mortgage Loans.
(a) The Trustee acknowledges receipt of the documents identified
in the
Initial Certification in the form annexed hereto as Exhibit F
(an "Initial
Certification") and declares that it holds and will hold such
documents and
the other documents delivered to it constituting the Mortgage
Files, and that
it holds or will hold such other assets as are included in the
Trust Fund, in
trust for the exclusive use and benefit of all present and
future
Certificateholders. The Trustee acknowledges that it will
maintain possession
of the Mortgage Notes in the State of California, unless
otherwise permitted
by the Rating Agencies.
The Trustee agrees to execute and deliver on the Closing Date to
the
Depositor, the Master Servicer and Countrywide (on its own
behalf and on
behalf of Park Granada and Park Sienna) an Initial Certification
in the form
annexed to this Agreement as Exhibit F. Based on its review and
examination,
and only as to the documents identified in such Initial
Certification, the
Trustee acknowledges that such documents appear regular on their
face and
relate to the Mortgage Loans. The Trustee shall be under no duty
or obligation
to inspect, review or examine said documents, instruments,
certificates or
other papers to determine that the same are genuine, enforceable
or
appropriate for the represented purpose or that they have
actually been
recorded in the real estate records or that they are other than
what they
purport to be on their face.
On or about the thirtieth (30th) day after the Closing Date, the
Trustee
shall deliver to the Depositor, the Master Servicer and
Countrywide (on its
own behalf and on behalf of Park Granada and Park Sienna) a
Delay Delivery
Certification with respect to the Mortgage Loans in the form
annexed hereto as
Exhibit G (a "Delay Delivery Certification"), with any
applicable exceptions
noted thereon.
Not later than 90 days after the Closing Date, the Trustee shall
deliver
to the Depositor, the Master Servicer and Countrywide (on its
own behalf and
on behalf of Park Granada and Park Sienna) a Final Certification
with respect
to the Mortgage Loans in the form annexed hereto as Exhibit H (a
"Final
Certification"), with any applicable exceptions noted
thereon.
If, in the course of such review, the Trustee finds any
document
constituting a part of a Mortgage File that does not meet the
requirements of
Section 2.01, the Trustee shall list such as 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 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
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<PAGE>
not correct or cure such defect within such period, Countrywide
(on its own
behalf and on behalf of Park Granada 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 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 and Park Sienna) and the Trustee over the location
or status of
the recorded document, then such substitution or purchase shall
occur within
720 days from the Closing Date. The Trustee shall deliver
written notice to
each Rating Agency within 270 days from the Closing Date
indicating each
Mortgage Loan (a) that has not been returned by the appropriate
recording
office or (b) as to which there is a dispute as to location or
status of such
Mortgage Loan. Such notice shall be delivered every 90 days
thereafter until
the related Mortgage Loan is returned to the Trustee. Any such
substitution
pursuant to (a) above or purchase pursuant to (b) above shall
not be effected
prior to the delivery to the Trustee of the Opinion of Counsel
required by
Section 2.05, if any, and any substitution pursuant to (a) above
shall not be
effected prior to the additional delivery to the Trustee of a
Request for
Release substantially in the form of Exhibit N. No substitution
is permitted
to be made in any calendar month after the Determination Date
for such month.
The Purchase Price for any such Mortgage Loan shall be deposited
by
Countrywide (on its own behalf and on behalf of Park Granada 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 and Park
Sienna) and shall execute and deliver at Countrywide's (on its
own behalf and
on behalf of Park Granada 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 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 and
Park Sienna) repurchases a Mortgage Loan that is a MERS Mortgage
Loan, the
Master Servicer shall either (i) cause MERS to execute and
deliver an
assignment of the Mortgage in recordable form to transfer the
Mortgage from
MERS to Countrywide (on its own behalf and on behalf of Park
Granada 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 and Park
Sienna) or its
designee as the beneficial holder of such Mortgage Loan.
(b) [Reserved].
(c) [Reserved].
(d) The Trustee shall retain possession and custody of each
Mortgage File
in accordance with and subject to the terms and conditions set
forth in this
Agreement. The Master Servicer
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<PAGE>
shall promptly deliver to the Trustee, upon the execution or
receipt thereof,
the originals of such other documents or instruments
constituting the Mortgage
File as come into the possession of the Master Servicer from
time to time.
(e) It is understood and agreed that the respective obligations
of each
Seller to substitute for or to purchase any Mortgage Loan sold
to the
Depositor by it which does not meet the requirements of Section
2.01 above
shall constitute the sole remedy respecting such defect
available to the
Trustee, the Depositor and any Certificateholder against that
Seller.
SECTION 2.03. Representations, Warranties and Covenants of the
Sellers
and Master Servicer.
(a) Countrywide hereby makes the representations and warranties
set forth
in (i) Schedule II-A and Schedule II-B hereto, and by this
reference
incorporated herein, to the Depositor, the Master Servicer and
the Trustee, as
of the Closing Date, (ii) Schedule III-A hereto, and by this
reference
incorporated herein, to the Depositor, the Master Servicer and
the Trustee, as
of the Closing Date, or if so specified therein, as of the
Cut-off Date with
respect to the Mortgage Loans, and (iii) Schedule III-B hereto,
and by this
reference incorporated herein, to the Depositor, the Master
Servicer and the
Trustee, as of the Closing Date, or if so specified therein, as
of the Cut-off
Date with respect to the Mortgage Loans that are Countrywide
Mortgage Loans.
Park Granada hereby makes the representations and warranties set
forth in (i)
Schedule II-B hereto, and by this reference incorporated herein,
to the
Depositor, the Master Servicer and the Trustee, as of the
Closing Date and
(ii) Schedule III-C hereto, and by this reference incorporated
herein, to the
Depositor, the Master Servicer and the Trustee, as of the
Closing Date, or if
so specified therein, as of the Cut-off Date with respect to the
Mortgage
Loans that are Park Granada Mortgage Loans. Park Sienna 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
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) that
materially and adversely affects the interests of the
Certificateholders in
that Mortgage Loan, it shall cure such breach in all material
respects, and if
such breach is not so cured, shall, (i) if such 90-day period
expires prior to
the second anniversary of the Closing Date, remove such Mortgage
Loan (a
"Deleted Mortgage Loan") from the Trust Fund and substitute in
its place a
Substitute Mortgage Loan, in the manner and
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<PAGE>
subject to the conditions set forth in this Section; or (ii)
repurchase the
affected Mortgage Loan or Mortgage Loans from the Trustee at the
Purchase
Price in the manner set forth below; provided, however, that any
such
substitution pursuant to (i) above shall not be effected prior
to the delivery
to the Trustee of the Opinion of Counsel required by Section
2.05, if any, and
any such substitution pursuant to (i) above shall not be
effected prior to the
additional delivery to the Trustee of a Request for Release
substantially in
the form of Exhibit N and the Mortgage File for any such
Substitute Mortgage
Loan. The Seller repurchasing a Mortgage Loan pursuant to this
Section 2.03(c)
shall promptly reimburse the Master Servicer and the Trustee for
any expenses
reasonably incurred by the Master Servicer or the Trustee in
respect of
enforcing the remedies for such breach. With respect to the
representations
and warranties described in this Section which are made to the
best of a
Seller's knowledge, if it is discovered by either the Depositor,
a Seller or
the Trustee that the substance of such representation and
warranty is
inaccurate and such inaccuracy materially and adversely affects
the value of
the related Mortgage Loan or the interests of the
Certificateholders therein,
notwithstanding that Seller's lack of knowledge with respect to
the substance
of such representation or warranty, such inaccuracy shall be
deemed a breach
of the applicable representation or warranty.
With respect to any Substitute Mortgage Loan or Loans sold to
the
Depositor by a Seller, Countrywide (on its own behalf and on
behalf of Park
Granada and Park Sienna) shall deliver to the Trustee for the
benefit of the
Certificateholders the Mortgage Note, the Mortgage, the related
assignment of
the Mortgage, and such other documents and agreements as are
required by
Section 2.01, with the Mortgage Note endorsed and the Mortgage
assigned as
required by Section 2.01. No substitution is permitted to be
made in any
calendar month after the Determination Date for such month.
Scheduled Payments
due with respect to Substitute Mortgage Loans in the month of
substitution
shall not be part of the Trust Fund and will be retained by the
related Seller
on the next succeeding Distribution Date. For the month of
substitution,
distributions to Certificateholders will include the monthly
payment due on
any Deleted Mortgage Loan for such month and thereafter that
Seller shall be
entitled to retain all amounts received in respect of such
Deleted Mortgage
Loan. The Master Servicer shall amend the Mortgage Loan Schedule
for the
benefit of the Certificateholders to reflect the removal of such
Deleted
Mortgage Loan and the substitution of the Substitute Mortgage
Loan or Loans
and the Master Servicer shall deliver the amended Mortgage Loan
Schedule to
the Trustee. Upon such substitution, the Substitute Mortgage
Loan or Loans
shall be subject to the terms of this Agreement in all respects,
and the
related Seller shall be deemed to have made with respect to such
Substitute
Mortgage Loan or Loans, as of the date of substitution, the
representations
and warranties made pursuant to Section 2.03(a) with respect to
such Mortgage
Loan. Upon any such substitution and the deposit to the
Certificate Account of
the amount required to be deposited therein in connection with
such
substitution as described in the following paragraph, the
Trustee shall
release the Mortgage File held for the benefit of the
Certificateholders
relating to such Deleted Mortgage Loan to the related Seller and
shall execute
and deliver at such Seller's direction such instruments of
transfer or
assignment prepared by Countrywide (on its own behalf and on
behalf of Park
Granada 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
36
<PAGE>
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 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 of this Agreement or such
other date set
forth in this Agreement that as of the Closing Date, and
following the
transfer of the Mortgage Loans to it by each Seller, the
Depositor had good
title to the Mortgage Loans and the Mortgage Notes were subject
to no offsets,
defenses or counterclaims.
The Depositor hereby assigns, transfers and conveys to the
Trustee all of
its rights with respect to the Mortgage Loans including, without
limitation,
the representations and warranties of each Seller made pursuant
to Section
2.03(a), together with all rights of the Depositor to require a
Seller to cure
any breach thereof or to repurchase or substitute for any
affected Mortgage
Loan in accordance with this Agreement.
It is understood and agreed that the representations and
warranties set
forth in this Section 2.04 shall survive delivery of the
Mortgage Files to the
Trustee. Upon discovery by the Depositor or the Trustee of a
breach of any of
the foregoing representations and warranties set
37
<PAGE>
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 under this Agreement to fail to
qualify as a
REMIC at any time that any Certificates are outstanding.
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 and Park Sienna) at its option, to either
(i)
substitute, if the conditions in Section 2.03(c) with respect to
substitutions
are satisfied, a Substitute Mortgage Loan for the affected
Mortgage Loan, or
(ii) repurchase the affected Mortgage Loan within 90 days of
such discovery in
the same manner as it would a Mortgage Loan for a breach of
representation or
warranty made pursuant to Section 2.03. The Trustee shall
reconvey to
Countrywide the Mortgage Loan to be released pursuant to this
Section in the
same manner, and on the same terms and conditions, as it would a
Mortgage Loan
repurchased for breach of a representation or warranty contained
in Section
2.03.
SECTION 2.06. Execution and Delivery of Certificates.
The Trustee acknowledges the transfer and assignment to it of
the Trust
Fund and, concurrently with such transfer and assignment, has
executed and
delivered to or upon the order of the Depositor, the
Certificates in
authorized denominations evidencing directly or indirectly the
entire
ownership of the Trust Fund. The Trustee agrees to hold the
Trust Fund and
exercise the rights referred to above for the benefit of all
present and
future Holders of the Certificates and to perform the duties set
forth in this
Agreement to the best of its ability, 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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SECTION 2.08. Covenants of the Master Servicer.
The Master Servicer covenants to the Depositor and the Trustee
as
follows:
(a) the Master Servicer shall comply in the performance of
its
obligations under this Agreement with all reasonable rules and
requirements of
the insurer under each Required Insurance Policy; and
(b) no written information, certificate of an officer,
statement
furnished in writing or written report delivered to the
Depositor, any
affiliate of the Depositor or the Trustee and prepared by the
Master Servicer
pursuant to this Agreement will contain any untrue statement of
a material
fact or omit to state a material fact necessary to make such
information,
certificate, statement or report not misleading.
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ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
SECTION 3.01. Master Servicer to Service Mortgage Loans.
For and on behalf of the Certificateholders, the Master Servicer
shall
service and administer the Mortgage Loans in accordance with the
terms of this
Agreement and customary and usual standards of practice of
prudent mortgage
loan servicers. In connection with such servicing and
administration, the
Master Servicer shall have full power and authority, acting
alone and/or
through Subservicers as provided in Section 3.02, subject to the
terms of this
Agreement (i) to execute and deliver, on behalf of the
Certificateholders and
the Trustee, customary consents or waivers and other instruments
and
documents, (ii) to consent to transfers of any Mortgaged
Property and
assumptions of the Mortgage Notes and related Mortgages (but
only in the
manner provided in this Agreement), (iii) to collect any
Insurance Proceeds
and other Liquidation Proceeds (which for the purpose of this
Section 3.01
includes any Subsequent Recoveries) and (iv) to effectuate
foreclosure or
other conversion of the ownership of the Mortgaged Property
securing any
Mortgage Loan; provided that the Master Servicer shall not take
any action
that is inconsistent with or prejudices the interests of the
Trust Fund or the
Certificateholders in any Mortgage Loan or the rights and
interests of the
Depositor, the Trustee and the Certificateholders under this
Agreement. The
Master Servicer shall represent and protect the interests of the
Trust Fund in
the same manner as it protects its own interests in mortgage
loans in its own
portfolio in any claim, proceeding or litigation regarding a
Mortgage Loan,
and shall not make or permit any modification, waiver or
amendment of any
Mortgage Loan which would cause any REMIC created under this
Agreement to fail
to qualify as a REMIC or result in the imposition of any tax
under section
860F(a) or section 860G(d) of the Code. Without limiting the
generality of the
foregoing, the Master Servicer, in its own name or in the name
of the
Depositor and the Trustee, is hereby authorized and empowered by
the Depositor
and the Trustee, when the Master Servicer believes it
appropriate in its
reasonable judgment, to execute and deliver, on behalf of the
Trustee, the
Depositor, the Certificateholders or any of them, any and all
instruments of
satisfaction or cancellation, or of partial or full release or
discharge and
all other comparable instruments, with respect to the Mortgage
Loans, and with
respect to the Mortgaged Properties held for the benefit of
the
Certificateholders. The Master Servicer shall prepare and
deliver to the
Depositor and/or the Trustee such documents requiring execution
and delivery
by either or both of them as are necessary or appropriate to
enable the Master
Servicer to service and administer the Mortgage Loans to the
extent that the
Master Servicer is not permitted to execute and deliver such
documents
pursuant to the preceding sentence. Upon receipt of such
documents, the
Depositor and/or the Trustee shall execute such documents and
deliver them to
the Master Servicer. The Master Servicer further is authorized
and empowered
by the Trustee, on behalf of the Certificateholders and the
Trustee, in its
own name or in the name of the Subservicer, when the Master
Servicer or the
Subservicer, as the case may be, believes it appropriate in its
best judgment
to register any Mortgage Loan on the MERS(R) System, or cause
the removal from
the registration of any Mortgage Loan on the MERS(R) System, to
execute and
deliver, on behalf of the Trustee and the Certificateholders or
any of them,
any and all instruments of assignment and other comparable
instruments with
respect to such assignment or re-recording of a Mortgage in the
name of MERS,
solely as nominee for the Trustee and its successors and
assigns.
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In accordance with the standards of the preceding paragraph, the
Master
Servicer shall advance or cause to be advanced funds as
necessary for the
purpose of effecting the payment of taxes and assessments on the
Mortgaged
Properties, which advances shall be reimbursable in the first
instance from
related collections from the Mortgagors pursuant to Section
3.06, and further
as provided in Section 3.08. The costs incurred by the Master
Servicer, if
any, in effecting the timely payments of taxes and assessments
on the
Mortgaged Properties and related insurance premiums shall not,
for the purpose
of calculating monthly distributions to the Certificateholders,
be added to
the Stated Principal Balances of the related Mortgage Loans,
notwithstanding
that the terms of such Mortgage Loans so permit.
SECTION 3.02. Subservicing; Enforcement of the Obligations
of
Subservicers.
(a) The Master Servicer may arrange for the subservicing of any
Mortgage
Loan by a Subservicer pursuant to a subservicing agreement;
provided, however,
that such subservicing arrangement and the terms of the related
subservicing
agreement must provide for the servicing of such Mortgage Loans
in a manner
consistent with the servicing arrangements contemplated under
this Agreement.
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
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Trustee or the Depositor be obligated to supervise the
performance of the
Master Servicer under this Agreement or otherwise.
SECTION 3.04. Trustee to Act as Master Servicer.
In the event that the Master Servicer shall for any reason no
longer be
the Master Servicer hereunder (including by reason of an Event
of Default),
the Trustee or its successor shall then 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 or any acts or omissions of the predecessor
Master Servicer
under this Agreement), (ii) obligated to make Advances if it is
prohibited
from doing so by applicable law, (iii) obligated to effectuate
repurchases or
substitutions of Mortgage Loans hereunder including, but not
limited to,
repurchases or substitutions of Mortgage Loans pursuant to
Section 2.02 or
2.03, (iv) responsible for expenses of the Master Servicer
pursuant to Section
2.03 or (v) deemed to have made any representations and
warranties of the
Master Servicer under this Agreement). Any such assumption shall
be subject to
Section 7.02. If the Master Servicer shall for any reason no
longer be the
Master Servicer (including by reason of any Event of Default),
the Trustee or
its successor shall succeed to any rights and obligations of the
Master
Servicer under each subservicing agreement.
The Master Servicer shall, upon request of the Trustee, but at
the
expense of the Master Servicer, deliver to the assuming party
all documents
and records relating to each subservicing agreement or
substitute subservicing
agreement and the Mortgage Loans then being serviced thereunder
and an
accounting of amounts collected or held by it and otherwise use
its best
efforts to effect the orderly and efficient transfer of the
substitute
subservicing agreement to the assuming party.
SECTION 3.05. Collection of Mortgage Loan Payments; Certificate
Account;
Distribution Account.
(a) The Master Servicer shall make reasonable efforts in
accordance with
the customary and usual standards of practice of prudent
mortgage servicers to
collect all payments called for under the terms and provisions
of the Mortgage
Loans to the extent such procedures shall be consistent with
this Agreement
and the terms and provisions of any related Required Insurance
Policy.
Consistent with the foregoing, the Master Servicer may in its
discretion (i)
waive any late payment charge or any prepayment charge or
penalty interest in
connection with the prepayment of a Mortgage Loan and (ii)
extend the due
dates for payments due on a Mortgage Note for a period not
greater than 180
days; provided, however, that the Master Servicer cannot extend
the maturity
of any such Mortgage Loan past the date on which the final
payment is due on
the latest maturing Mortgage Loan as of the Cut-off Date. In the
event of any
such arrangement, the Master Servicer shall make Advances on the
related
Mortgage Loan in accordance with the provisions of Section 4.01
during the
scheduled period in accordance with the amortization schedule of
such Mortgage
Loan without modification thereof by reason of such
arrangements. The Master
Servicer shall not be required to institute or join in
litigation with respect
to collection of any payment (whether under a Mortgage, Mortgage
Note or
otherwise or against any public or governmental authority with
respect to a
taking or condemnation) if it
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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 Home Loans, Inc. is reduced below
"A-" by S&P or
"A3" by Moody's, the Master Servicer shall deposit or cause to
be deposited on
a daily basis within one Business Day of receipt), except as
otherwise
specifically provided in this Agreement, the following payments
and
collections remitted by Subservicers or received by it in
respect of Mortgage
Loans subsequent to the Cut-off Date (other than in respect of
principal and
interest due on the Mortgage Loans on or before the Cut-off
Date) and the
following amounts required to be deposited 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 any lender paid
mortgage
insurance premiums;
(iii) all Insurance Proceeds, Subsequent Recoveries and
Liquidation
Proceeds, other than proceeds to be applied to the restoration
or repair
of a Mortgaged Property or released to the Mortgagor in
accordance with
the Master Servicer's normal servicing procedures;
(iv) any amount required to be deposited by the Master
Servicer
pursuant to Section 3.05(e) in connection with any losses on
Permitted
Investments;
(v) any amounts required to be deposited by the Master
Servicer
pursuant to Section 3.09(c) and in respect of net monthly rental
income
from REO Property pursuant to Section 3.11;
(vi) all Substitution Adjustment Amounts;
(vii) all Advances made by the Master Servicer pursuant to
Section
4.01; and
(viii) any other amounts required to be deposited under this
Agreement.
In addition, with respect to any Mortgage Loan that is subject
to a
buydown agreement, on each Due Date for such Mortgage Loan, in
addition to the
monthly payment remitted by the Mortgagor, the Master Servicer
shall cause
funds to be deposited into the Certificate Account in an amount
required to
cause an amount of interest to be paid with respect to such
Mortgage Loan
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
prepayment penalties,
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
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amount not required to be remitted, it may at any time withdraw
or direct the
institution maintaining the Certificate Account to withdraw such
amount from
the Certificate Account, any provision in this Agreement to the
contrary
notwithstanding. Such withdrawal or direction may be
accomplished by
delivering written notice thereof to the Trustee or such other
institution
maintaining the Certificate Account which describes the amounts
deposited in
error in the Certificate Account. The Master Servicer shall
maintain adequate
records with respect to all withdrawals made pursuant to this
Section. All
funds deposited in the Certificate Account shall be held in
trust for the
Certificateholders until withdrawn in accordance with Section
3.08.
(c) [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 in the
Distribution
Account the following:
(i) the aggregate amount remitted by the Master Servicer to
the
Trustee pursuant to Section 3.08(a)(ix);
(ii) any amount deposited by the Master Servicer pursuant to
Section
3.05(e) in connection with any losses on Permitted Investments;
and
(iii) any other amounts deposited hereunder which are required
to be
deposited in the Distribution Account.
In the event that the Master Servicer shall remit any amount not
required
to be remitted, it may at any time direct the Trustee to
withdraw such amount
from the Distribution Account, any provision in this Agreement
to the contrary
notwithstanding. Such direction may be accomplished by
delivering an Officer's
Certificate to the Trustee which describes the amounts deposited
in error in
the Distribution Account. All funds deposited in the
Distribution Account
shall be held by the Trustee in trust for the Certificateholders
until
disbursed in accordance with this Agreement or withdrawn in
accordance with
Section 3.08. In no event shall the Trustee incur liability for
withdrawals
from the Distribution Account at the direction of the Master
Servicer.
(e) Each institution at which the Certificate Account or the
Distribution
Account is maintained shall invest the funds in such account 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
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Distribution Account shall be for the benefit of the Master
Servicer as
servicing compensation and shall be remitted to it monthly as
provided in this
Agreement. The amount of any realized losses in the Certificate
Account or the
Distribution Account incurred in any such account in respect of
any such
investments shall promptly be deposited by the Master Servicer
in the
Certificate Account or paid to the Trustee for deposit into the
Distribution
Account, as applicable. The Trustee in its fiduciary capacity
shall not be
liable for the amount of any loss incurred in respect of any
investment or
lack of investment of funds held in the Certificate Account or
the
Distribution Account and made in accordance with this Section
3.05.
(f) The Master Servicer shall give notice to the Trustee, each
Seller,
each Rating Agency and the Depositor of any proposed change of
the location of
the Certificate Account prior to any change thereof. The Trustee
shall give
notice to the Master Servicer, each Seller, each Rating Agency
and the
Depositor of any proposed change of the location of the
Distribution Account
prior to any change thereof.
(g) Reserved.
(h) Reserved.
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 in
such accounts
all collections from the Mortgagors (or advances by the Master
Servicer) for
the payment of taxes, assessments, hazard insurance premiums or
comparable
items for the account of the Mortgagors. Nothing in this
Agreement shall
require the Master Servicer to compel a Mortgagor to establish
an Escrow
Account in violation of applicable law.
(b) Withdrawals of amounts so collected from the Escrow Accounts
may be
made only to effect timely payment of taxes, assessments, hazard
insurance
premiums, condominium or PUD association dues, or comparable
items, to
reimburse the Master Servicer out of related collections for any
payments made
pursuant to Sections 3.01 (with respect to taxes and assessments
and insurance
premiums) and 3.09 (with respect to hazard insurance), to refund
to any
Mortgagors any sums determined to be overages, to pay interest,
if required by
law or the terms of the related Mortgage or Mortgage Note, to
Mortgagors on
balances in the Escrow Account or to clear and terminate the
Escrow Account at
the termination of this Agreement in accordance with Section
9.01. The Escrow
Accounts shall not be a part of the Trust Fund.
(c) The Master Servicer shall advance any payments referred to
in Section
3.06(a) that are not timely paid by the Mortgagors on the date
when the tax,
premium or other cost for which such payment is intended is due,
but the
Master Servicer shall be required so to advance only to the
extent that such
advances, in the good faith judgment of the Master Servicer will
be
recoverable by the Master Servicer out of Insurance Proceeds,
Liquidation
Proceeds or otherwise.
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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 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 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 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
and the
Distribution Account.
(a) The Master Servicer may from time to time make withdrawals
from the
Certificate Account for the following purposes:
(i) to pay to the Master Servicer (to the extent not
previously
retained by the Master Servicer), the servicing compensation to
which it
is entitled pursuant to Section 3.14 and to pay to the Master
Servicer,
as additional servicing compensation, earnings on or investment
income
with respect to funds in or credited to the Certificate
Account;
(ii) to reimburse each of the Master Servicer and the Trustee
for
unreimbursed Advances made by it, such right of reimbursement
pursuant to
this subclause (ii) being limited to amounts received on the
Mortgage
Loan(s) in respect of which any such Advance was made;
(iii) to reimburse each of the Master Servicer and the Trustee
for
any Nonrecoverable Advance previously made by it;
(iv) to reimburse the Master Servicer for Insured Expenses from
the
related Insurance Proceeds;
(v) to reimburse the Master Servicer for (a) unreimbursed
Servicing
Advances, the Master Servicer's right to reimbursement pursuant
to this
clause (a) with respect to any Mortgage Loan being limited to
amounts
received on such Mortgage Loan(s) that represent late recoveries
of the
payments for which such advances were made pursuant to Section
3.01 or
Section 3.06 and (b) for unpaid Master Servicing Fees as
provided in
Section 3.11;
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(vi) to pay to the purchaser, with respect to each Mortgage Loan
or
property acquired in respect thereof that has been purchased
pursuant to
Section 2.02, 2.03 or 3.11, all amounts received on such
Mortgage Loan
after the date of such purchase;
(vii) to reimburse the Sellers, the Master Servicer or the
Depositor
for expenses incurred by any of them and reimbursable pursuant
to Section
6.03;
(viii) to withdraw any amount deposited in the Certificate
Account
and not required to be deposited in the Certificate Account;
(ix) on or prior to the Distribution Account Deposit Date,
to
withdraw an amount equal to the related Available Funds and the
Trustee
Fee for such Distribution Date and remit such amount to the
Trustee for
deposit in the Distribution Account; and
(x) to clear and terminate the Certificate Account upon
termination
of this Agreement pursuant to Section 9.01.
The Master Servicer shall keep and maintain separate accounting,
on a
Mortgage Loan by Mortgage Loan basis, for the purpose of
justifying any
withdrawal from the Certificate Account pursuant to such
subclauses (i), (ii),
(iv), (v) and (vi). Prior to making any withdrawal from the
Certificate
Account pursuant to subclause (iii), the Master Servicer shall
deliver to the
Trustee an Officer's Certificate of a Servicing Officer
indicating the amount
of any previous Advance determined by the Master Servicer to be
a
Nonrecoverable Advance and identifying the related Mortgage
Loans(s), and
their respective portions of such Nonrecoverable Advance.
(b) The Trustee shall withdraw funds from the Distribution
Account for
distributions to Certificateholders, 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 last paragraph of
Section 8.11).
In addition, the Trustee may from time to time make withdrawals
from the
Distribution Account for the following purposes:
(i) to pay to itself the Trustee Fee for the related
Distribution
Date;
(ii) to pay to the Master Servicer as additional servicing
compensation earnings on or investment income with respect to
funds in
the Distribution Account;
(iii) to withdraw and return to the Master Servicer any
amount
deposited in the Distribution Account and not required to be
deposited
therein;
(iv) to reimburse the Trustee for any unreimbursed Advances made
by
it pursuant to Section 4.01(b) hereof, such right of
reimbursement
pursuant to this subclause (iv) being limited to (x) amounts
received on
the related Mortgage Loan(s) in respect of which any such
Advance was
made and (y) amounts not otherwise reimbursed to the Trustee
pursuant to
Section 3.08(a)(ii) hereof;
(v) to reimburse the Trustee for any Nonrecoverable Advance
previously made by the Trustee pursuant to Section 4.01(b)
hereof, such
right of reimbursement
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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.
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 liquidation proceeds or Subsequent
Recoveries to
the extent permitted by Section 3.08. It is understood and
agreed that no
earthquake or other additional insurance is to be required of
any Mortgagor or
maintained on property acquired in respect of a Mortgage other
than pursuant
to such applicable laws and regulations as shall at any time be
in force and
as shall require such additional insurance. If the Mortgaged
Property is
located at the time of origination of the Mortgage Loan in a
federally
designated special flood hazard area and such area is
participating in the
national flood insurance program, the Master Servicer shall
cause flood
insurance to be maintained with respect to such Mortgage Loan.
Such flood
insurance shall be in an amount equal to the least of (i) the
outstanding
principal balance of the related Mortgage Loan, (ii) the
replacement value of
the improvements which are part of such Mortgaged Property, and
(iii) the
maximum amount of such insurance available for the related
Mortgaged Property
under the national flood insurance program.
(b) The Master Servicer shall not take any action which would
result in
non-coverage under any applicable Primary Insurance Policy of
any loss which,
but for the actions of the Master Servicer, would have been
covered
thereunder. The Master Servicer shall not cancel or refuse to
renew any such
Primary Insurance Policy that is in effect at the date of the
initial issuance
of the Certificates and is required to be kept in force
hereunder unless the
replacement Primary Insurance Policy for such canceled or
non-renewed policy
is maintained with a Qualified Insurer.
Except with respect to any Lender PMI Mortgage Loans, the Master
Servicer
shall not be required to maintain any Primary Insurance Policy
(i) with
respect to any Mortgage Loan with a
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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
liquidation
proceeds 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.
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(b) Subject to the Master Servicer's duty to enforce any
due-on-sale
clause to the extent set forth in Section 3.10(a), in any case
in which a
Mortgaged Property has been conveyed to a Person by a Mortgagor,
and such
Person is to enter into an assumption agreement or modification
agreement or
supplement to the Mortgage Note or Mortgage that requires the
signature of the
Trustee, or if an instrument of release signed by the Trustee is
required
releasing the Mortgagor from liability on the Mortgage Loan, the
Master
Servicer shall prepare and deliver or cause to be prepared and
delivered to
the Trustee for signature and shall direct, in writing, the
Trustee to execute
the assumption agreement with the Person to whom the Mortgaged
Property is to
be conveyed and such modification agreement or supplement to the
Mortgage Note
or Mortgage or other instruments as are reasonable or necessary
to carry out
the terms of the Mortgage Note or Mortgage or otherwise to
comply with any
applicable laws regarding assumptions or the transfer of the
Mortgaged
Property to such Person. In connection with any such assumption,
no material
term of the Mortgage Note may be changed. In addition, the
substitute
Mortgagor and the Mortgaged Property must be acceptable to the
Master Servicer
in accordance with its underwriting standards as then in effect.
Together with
each such substitution, assumption or other agreement or
instrument delivered
to the Trustee for execution by it, the Master Servicer shall
deliver an
Officer's Certificate signed by a Servicing Officer stating that
the
requirements of this subsection have been met in connection
therewith. The
Master Servicer shall notify the Trustee that any such
substitution or
assumption agreement has been completed by forwarding to the
Trustee the
original of such substitution or assumption agreement, which in
the case of
the original shall be added to the related Mortgage File and
shall, for all
purposes, be considered a part of such Mortgage File to the same
extent as all
other documents and instruments constituting a part thereof. Any
fee collected
by the Master Servicer for entering into an assumption or
substitution of
liability agreement will be retained by the Master Servicer as
additional
servicing compensation.
SECTION 3.11. Realization Upon Defaulted Mortgage Loans;
Repurchase of
Certain Mortgage Loans.
(a) The Master Servicer shall use reasonable efforts to
foreclose upon or
otherwise comparably convert the ownership of properties
securing such of the
Mortgage Loans as come into and continue in default and as to
which no
satisfactory arrangements can be made for collection of
delinquent payments.
In connection with any 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 Liquidation
Proceeds 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 of
such costs and expenses from the liquidation proceeds 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
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of foreclosure is located within a one mile radius of any site
listed in the
Expenditure Plan for the Hazardous Substance Clean Up Bond Act
of 1984 or
other site with environmental or hazardous waste risks known to
the Master
Servicer, the Master Servicer will, prior to acquiring the
Mortgaged Property,
consider such risks and only take action in accordance with its
established
environmental review procedures.
With respect to any REO Property, the deed or certificate of
sale shall
be taken in the name of the Trustee for the benefit of the
Certificateholders,
or its nominee, on behalf of the Certificateholders. The
Trustee's name shall
be placed on the title to such REO Property solely as the
Trustee hereunder
and not in its individual capacity. The Master Servicer shall
ensure that the
title to such REO Property references the Pooling and Servicing
Agreement and
the Trustee's capacity thereunder. Pursuant to its efforts to
sell such REO
Property, the Master Servicer shall either itself or through an
agent selected
by the Master Servicer protect and conserve such REO Property in
the same
manner and to such extent as is customary in the locality where
such REO
Property is located and may, incident to its conservation and
protection of
the interests of the Certificateholders, rent the same, or any
part thereof,
as the Master Servicer deems to be in the best interest of
the
Certificateholders for the period prior to the sale of such REO
Property. The
Master Servicer shall prepare for and deliver to the Trustee a
statement with
respect to each REO Property that has been rented showing the
aggregate rental
income received and all expenses incurred in connection with the
maintenance
of such REO Property at such times as is necessary to enable the
Trustee to
comply with the reporting requirements of the REMIC Provisions.
The net
monthly rental income, if any, from such REO Property shall be
deposited in
the Certificate Account no later than the close of business on
each
Determination Date. The Master Servicer shall perform the tax
reporting and
withholding required by sections 1445 and 6050J of the Code with
respect to
foreclosures and abandonments, the tax reporting required by
section 6050H of
the Code with respect to the receipt of mortgage interest from
individuals and
any tax reporting required by section 6050P of the Code with
respect to the
cancellation of indebtedness by certain financial entities, by
preparing such
tax and information returns as may be required, in the form
required, and
delivering the same to the Trustee for filing.
In the event that the Trust Fund acquires any Mortgaged Property
as
aforesaid or otherwise in connection with a default or imminent
default on a
Mortgage Loan, the Master Servicer shall dispose of such
Mortgaged Property as
soon as practicable in a manner that maximizes the Liquidation
Proceeds
thereof, but in no event later than three years after its
acquisition by the
Trust Fund. In that event, the Trustee shall have been supplied
with an
Opinion of Counsel to the effect that the holding by the Trust
Fund of such
Mortgaged Property subsequent to a three-year period, if
applicable, will not
result in the imposition of taxes on "prohibited transactions"
of any REMIC
hereunder as defined in section 860F of the Code or cause any
REMIC hereunder
to fail to qualify as a REMIC at any time that any Certificates
are
outstanding, and that the Trust Fund may continue to hold such
Mortgaged
Property (subject to any conditions contained in such Opinion of
Counsel)
after the expiration of such three-year period. Notwithstanding
any other
provision of this Agreement, no Mortgaged Property acquired by
the Trust Fund
shall be rented (or allowed to continue to be rented) or
otherwise used for
the production of income by or on behalf of the Trust Fund in
such a manner or
pursuant to any terms that would (i) cause such Mortgaged
Property to fail to
qualify as "foreclosure property" within the meaning of section
860G(a)(8) of
the Code or (ii) subject any REMIC hereunder to the imposition
of any federal,
state or local income taxes on the income earned from such
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Mortgaged Property under section 860G(c) of the Code or
otherwise, unless the
Master Servicer has agreed to indemnify and hold harmless the
Trust Fund with
respect to the imposition of any such taxes.
In the event of a default on a Mortgage Loan one or more of
whose obligor
is not a United States Person, as that term is defined in
section 7701(a)(30)
of the Code, in connection with any foreclosure or acquisition
of a deed in
lieu of foreclosure (together, "foreclosure") in respect of such
Mortgage
Loan, the Master Servicer will cause compliance with the
provisions of
Treasury Regulation Section 1.1445-2(d)(3) (or any successor
thereto)
necessary to assure that no withholding tax obligation arises
with respect to
the proceeds of such foreclosure except to the extent, if any,
that proceeds
of such foreclosure are required to be remitted to the obligors
on such
Mortgage Loan.
The decision of the Master Servicer to foreclose on a defaulted
Mortgage
Loan shall be subject to a determination by the Master Servicer
that the
proceeds of such foreclosure would exceed the costs and expenses
of bringing
such a proceeding. The income earned from the management of any
REO
Properties, net of reimbursement to the Master Servicer for
expenses incurred
(including any property or other taxes) in connection with such
management and
net of unreimbursed Master Servicing Fees, Advances and
Servicing Advances,
shall be applied to the payment of principal of and interest on
the related
defaulted Mortgage Loans (with interest accruing as though such
Mortgage Loans
were still current) and all such income shall be deemed, for all
purposes in
this Agreement, to be payments on account of principal and
interest on the
related Mortgage Notes and shall be deposited into the
Certificate Account. To
the extent the net income received during any calendar month is
in excess of
the amount attributable to amortizing principal and accrued
interest at the
related Mortgage Rate on the related Mortgage Loan for such
calendar month,
such excess shall be considered to be a partial prepayment of
principal of the
related Mortgage Loan.
The proceeds from any liquidation of a Mortgage Loan, as well as
any
income from an REO Property, will be applied in the following
order of
priority: first, to reimburse the Master Servicer for any
related unreimbursed
Servicing Advances and Master Servicing Fees; second, to
reimburse the Master
Servicer or the Trustee for any unreimbursed Advances; third, to
reimburse the
Certificate Account for any Nonrecoverable Advances (or portions
thereof) that
were previously withdrawn by the Master Servicer or the Trustee
pursuant to
Section 3.08(a)(iii) that related to such Mortgage Loan; fourth,
to accrued
and unpaid interest (to the extent no Advance has been made for
such amount or
any such Advance has been reimbursed) on the Mortgage Loan or
related REO
Property, at the Adjusted Net Mortgage Rate to the Due Date
occurring in the
month in which such amounts are required to be distributed; and
fifth, as a
recovery of principal of the Mortgage Loan. Excess Proceeds, if
any, from the
liquidation of a Liquidated 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
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