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EXHIBIT 99.1
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Exhibit 99.1
EXECUTION COPY
=====================================
CWMBS, INC.,
Depositor
COUNTRYWIDE HOME LOANS, INC.,
Seller
PARK GRANADA LLC,
Seller
COUNTRYWIDE HOME LOANS SERVICING LP,
Master Servicer
and
THE BANK OF NEW YORK,
Trustee
-----------------------------------
POOLING AND SERVICING AGREEMENT
Dated as of January 1, 2005
----------------------------------
CHL MORTGAGE PASS-THROUGH TRUST 2005-2
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2005-2
=====================================
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Table of Contents
Page
ARTICLE I
DEFINITIONS........................................................1
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND
WARRANTIES.....34
SECTION 2.01. Conveyance of Mortgage
Loans...........................34
SECTION 2.02. Acceptance by Trustee of the Mortgage
Loans............38
SECTION 2.03. Representations, Warranties and Covenants of
the
Sellers and Master Servicer............................40
SECTION 2.04. Representations and Warranties of the Depositor
as
to the Mortgage Loans..................................42
SECTION 2.05. Delivery of Opinion of Counsel in Connection
with
Substitutions..........................................42
SECTION 2.06. Execution and Delivery of
Certificates.................43
SECTION 2.07. REMIC
Matters..........................................43
SECTION 2.08. Covenants of the Master
Servicer.......................43
ARTICLE III ADMINISTRATION AND SERVICING OF MORTGAGE
LOANS..................44
SECTION 3.01. Master Servicer to Service Mortgage
Loans..............44
SECTION 3.02. Subservicing; Enforcement of the Obligations
of
Servicers..............................................45
SECTION 3.03. Rights of the Depositor and the Trustee in
Respect
of the Master Servicer.................................45
SECTION 3.04. Trustee to Act as Master
Servicer......................46
SECTION 3.05. Collection of Mortgage Loan Payments;
Certificate
Account; Distribution Account; Carryover Shortfall
Reserve Fund...........................................46
SECTION 3.06. Collection of Taxes, Assessments and Similar
Items; Escrow Accounts.................................50
SECTION 3.07. Access to Certain Documentation and
Information
Regarding the Mortgage Loans...........................50
SECTION 3.08. Permitted Withdrawals from the Certificate
Account; the Distribution Account and the
Carryover Shortfall Reserve Fund.......................51
SECTION 3.09. Maintenance of Hazard Insurance; Maintenance
of
Primary Insurance Policies.............................53
SECTION 3.10. Enforcement of Due-on-Sale Clauses; Assumption
Agreements.............................................54
SECTION 3.11. Realization Upon Defaulted Mortgage Loans;
Repurchase of Certain Mortgage Loans...................55
SECTION 3.12. Trustee to Cooperate; Release of Mortgage
Files........59
SECTION 3.13. Documents, Records and Funds in Possession of
Master Servicer to be Held for the Trustee.............60
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SECTION 3.14. Servicing
Compensation.................................60
SECTION 3.15. Access to Certain
Documentation........................60
SECTION 3.16. Annual Statement as to
Compliance......................61
SECTION 3.17. Annual Independent Public Accountants'
Servicing
Statement; Financial Statements........................61
SECTION 3.18. Errors and Omissions Insurance; Fidelity
Bonds.........62
SECTION 3.19. Notification of
Adjustments............................62
SECTION 3.20. The Corridor
Contract..................................62
ARTICLE IV DISTRIBUTIONS AND ADVANCES BY THE MASTER
SERVICER................64
SECTION 4.01.
Advances...............................................64
SECTION 4.02. Priorities of
Distribution.............................65
SECTION 4.03. Allocation of Net Deferred
Interest....................71
SECTION 4.04. Allocation of Realized
Losses..........................72
SECTION 4.05. Cross-Collateralization; Adjustments to
Available
Funds..................................................73
SECTION 4.06. Monthly Statements to
Certificateholders...............74
SECTION 4.07.
[Reserved].............................................76
SECTION 4.08. Determination of Pass-Through Rates for LIBOR
Certificates...........................................76
ARTICLE V THE
CERTIFICATES..................................................79
SECTION 5.01. The
Certificates.......................................79
SECTION 5.02. Certificate Register; Registration of Transfer
and
Exchange of Certificates...............................79
SECTION 5.03. Mutilated, Destroyed, Lost or Stolen
Certificates......84
SECTION 5.04. Persons Deemed
Owners..................................84
SECTION 5.05. Access to List of Certificateholders' Names
and
Addresses..............................................84
SECTION 5.06. Maintenance of Office or
Agency........................85
ARTICLE VI THE DEPOSITOR AND THE MASTER
SERVICER............................86
SECTION 6.01. Respective Liabilities of the Depositor and
the
Master Servicer........................................86
SECTION 6.02. Merger or Consolidation of the Depositor or
the
Master Servicer........................................86
SECTION 6.03. Limitation on Liability of the Depositor, the
Sellers, the Master Servicer and Others................86
SECTION 6.04. Limitation on Resignation of Master
Servicer...........87
ARTICLE VII
DEFAULT.........................................................88
SECTION 7.01. Events of
Default......................................88
SECTION 7.02. Trustee to Act; Appointment of
Successor...............89
SECTION 7.03. Notification to
Certificateholders.....................91
ARTICLE VIII CONCERNING THE
TRUSTEE.........................................92
SECTION 8.01. Duties of
Trustee......................................92
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SECTION 8.02. Certain Matters Affecting the
Trustee..................93
SECTION 8.03. Trustee Not Liable for Certificates or
Mortgage
Loans..................................................94
SECTION 8.04. Trustee May Own
Certificates...........................94
SECTION 8.05. Trustee's Fees and
Expenses............................94
SECTION 8.06. Eligibility Requirements for
Trustee...................95
SECTION 8.07. Resignation and Removal of
Trustee.....................95
SECTION 8.08. Successor
Trustee......................................96
SECTION 8.09. Merger or Consolidation of
Trustee.....................96
SECTION 8.10. Appointment of Co-Trustee or Separate
Trustee..........97
SECTION 8.11. Tax
Matters............................................98
ARTICLE IX
TERMINATION.....................................................101
SECTION 9.01. Termination upon Liquidation or Purchase of
all
Mortgage Loans........................................101
SECTION 9.02. Final Distribution on the
Certificates................101
SECTION 9.03. Additional Termination
Requirements...................103
ARTICLE X MISCELLANEOUS
PROVISIONS.........................................106
SECTION 10.01.
Amendment.............................................106
SECTION 10.02. Recordation of Agreement;
Counterparts................107
SECTION 10.03. Governing
Law.........................................108
SECTION 10.04. Intention of
Parties..................................108
SECTION 10.05.
Notices...............................................108
SECTION 10.06. Severability of
Provisions............................109
SECTION 10.07.
Assignment............................................110
SECTION 10.08. Limitation on Rights of
Certificateholders............110
SECTION 10.09. Inspection and Audit
Rights...........................110
SECTION 10.10. Certificates Nonassessable and Fully
Paid.............111
SECTION 10.11.
[Reserved]............................................111
SECTION 10.12. Protection of
Assets..................................111
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 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 IV: Representations and Warranties of the Master
Servicer.S-IV-1
Schedule V: Principal Balance Schedules [if
applicable]............S-V-1
Schedule VI: Form of Monthly Master Servicer
Report................S-VI-1
EXHIBITS
Exhibit A: Form of Senior Certificate (excluding Notional
Amount
Certificates, if any)....................................A-1
Exhibit B: Form of Subordinated
Certificate.........................B-1
Exhibit C: Form of Class A-R Certificates (if
any)..................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 of Documents
(Mortgage
Loan) Paid in Full, Repurchased and Replaced)............N-1
Exhibit O:
[Reserved]...............................................O-1
Exhibit P:
[Reserved]...............................................P-1
Exhibit Q: Standard & Poor's LEVELS(R) Version 5.6
Glossary
Revised, Appendix E......................................Q-1
Exhibit R: Form of
Confirmation.....................................R-1
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<PAGE>
THIS POOLING AND SERVICING AGREEMENT, dated as of January 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"), 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. As provided herein,
the Trustee
will elect that the Trust Fund, other than the Corridor Contract
and the
Carryover Shortfall Reserve Fund, be treated for federal income
tax purposes
as comprising 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). The Lower Tier REMIC will
hold as assets
all property of the Trust Fund, other than the Corridor Contract
and the
Carryover Shortfall Reserve Fund, and will be evidenced by (i)
the Lower Tier
REMIC Regular Interests, which will be uncertificated and will
represent the
"REMIC regular interests" in the Lower Tier REMIC, and (ii) the
Class LTR-A-R
Interest, which will represent the "REMIC residual interest" in
the Lower Tier
REMIC. The Middle Tier REMIC will hold as assets the Lower Tier
REMIC Regular
Interests and will be evidenced (i) by the Middle Tier REMIC
Regular
Interests, which will be uncertificated and will represent the
REMIC regular
interests in the Middle Tier REMIC, and (ii) the Class MTR-A-R
Interest, which
will represent the REMIC residual interest in the Middle Tier
REMIC. The
Master REMIC will hold as assets the Middle Tier REMIC Regular
Interests and
will be evidenced by the Certificates, each of which (other than
the Class A-R
Certificate) will represent ownership of one or more REMIC
regular interests
in the Master REMIC. The Class A-R Certificate will represent
ownership of the
sole Class of the REMIC residual interest in each of the Lower
Tier REMIC, the
Middle Tier REMIC and the Master REMIC. The latest possible
maturity date, for
federal income tax purposes, of all REMIC regular interests
created herein
shall be the Latest Possible Maturity Date.
<PAGE>
The following table specifies the Class designation, interest
rate, and
principal amount for each Class of Lower Tier REMIC
Interests:
Initial Pass-Through Corresponding
Lower Tier REMIC Interests Balance Rate Loan Group
-------------------------- ------- ------------
-------------
LT-A-1 (0.9% of SP Gr. 1)....... (1) (2) 1
LT-B-1 (0.1% of SP Gr. 1)....... (1) (2) 1
LT-C-1 (0.9% of ASP Gr. 1)...... (1) (2) 1
LT-D-1 (0.1% of ASP Gr. 1)...... (1) (2) 1
LT-E-1 (Excess of Gr. 1)........ (1) (2) 1
LT-A-2 (0.9% of SP Gr. 2)....... (1) (2) 2
LT-B-2 (0.1% of SP Gr. 2)....... (1) (2) 2
LT-C-2 (0.9% of ASP Gr. 2)...... (1) (2) 2
LT-D-2 (0.1% of ASP Gr. 2)...... (1) (2) 2
LT-E-2 (Excess of Gr. 2)........ (1) (2) 2
LT-A-R.......................... (3) (3) N/A
---------------
(1) With respect to the Interests, each Lower Tier REMIC
Interest having an
"A" designation (each, an "LT-A Interest") will have a principal
balance
initially equal to 0.9% of the Subordinated Portion ("SP") of
its
Corresponding Loan Group. Each Lower Tier REMIC Interest having
a "B"
designation (each, an "LT-B Interest") will have a principal
balance
initially equal to 0.1% of the SP of its Corresponding Loan
Group. Each
Lower Tier REMIC Interest having a "C" designation (each, an
"LT-C
Interest") will have a principal balance initially equal to 0.9%
of the
Adjusted Subordinated Portion ("ASP") of its Corresponding Loan
Group.
Each Lower Tier REMIC Interest having a "D" designation (each,
an "LT-D
Interest") will have a principal balance initially equal to 0.1%
of the
ASP of its Corresponding Loan Group. The initial principal
balance of
each Lower Tier REMIC Interest having an "E" designation (each,
an "LT-E
Interest") will equal the excess of its Corresponding Loan Group
over
the initial aggregate principal balances of the LT-A, LT-B, LT-C
and
LT-D Interests corresponding to such Loan Group.
(2) A Rate equal to the weighted average of the Adjusted Net
Mortgage Rates
of the Mortgage Loans of the Corresponding Loan Group.
(3) The Lower Tier REMIC Interest is the sole class of residual
interest in
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 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 Lower Tier REMIC Interest, then
principal
amounts distributable with respect to each Loan Group will be
allocated:
first to cause the Loan Group's corresponding LT-A, LT-B, LT-C
and LT-D
Interests to equal, respectively, 0.9% of the
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SP, 0.1% of the SP, 0.9% of the ASP and 0.1% of the ASP, of
the
Corresponding Loan Group, and then to the corresponding LT-E
Interest.
(3) Principal if a Cross-Over Situation Exists. If a Cross-Over
Situation
exists with respect to the LT-A and LT-B Interests then:
(a) if the Calculation Rate in respect of the outstanding LT-A
and LT-B
Interests is less than the Subordinate Net Rate Cap, Principal
Relocation
Payments will be made proportionately to the outstanding LT-A
Interests prior
to any other principal distributions from each such Loan Group;
and
(b) if the Calculation Rate in respect of the outstanding LT-A
and LT-B
Interests is greater than the Subordinate Net Rate Cap,
Principal Relocation
Payments will be made proportionately to the outstanding LT-B
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 LT-A and LT-B
Interests to
equal the Subordinate Net Rate Cap. With respect to each Loan
Group, if (and
to the extent that) the sum of (a) the principal payments
comprising the
Principal Remittance Amount for the related Distribution Date
and (b) the
Realized Losses, are insufficient to make the necessary
reductions of
principal on the LT-A and LT-B Interests, then interest will be
added to the
Loan Group's LT-E Interest.
(c) The outstanding aggregate LT-A and LT-B Interests for both
Loan
Groups will not be reduced below 1 percent of the excess of (i)
the aggregate
Stated Principal Balance of the Mortgage Loans for such
Distribution Date over
(ii) the Senior Certificates related to the 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 LT-A and LT-B Interests of a
Loan Group, and
if the Loan Group's corresponding LT-E Interest has already been
reduced to
zero, then the excess principal from that Loan Group will be
paid to the LT-E
Interest of the other Loan Group, the aggregate LT-A and LT-B
Interests of
which are less than one percent of the Subordinated Portion. If
the Loan Group
of the corresponding LT-E 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 Lower Tier REMIC as a Realized Loss. Conversely, if
the Loan Group
of the LT-E 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
Lower Tier REMIC as a reimbursement for prior Realized
Losses.
If a Cross-Over Situation exists with respect to the LT-C and
LT-D Interests
then:
(a) if the Calculation Rate in respect of the outstanding LT-C
and LT-D
Interests is less than the Adjusted Subordinate Net Rate Cap,
Principal
Relocation Payments will be made proportionately to the
outstanding LT-C
Interests prior to any other principal distributions from each
such Loan
Group; and
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(b) if the Calculation Rate in respect of the outstanding LT-C
and LT-D
Interests is greater than the Adjusted Subordinate Net Rate Cap,
Principal
Relocation Payments will be made proportionately to the
outstanding LT-D
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 LT-C and LT-D
Interests to
equal the Adjusted Subordinate Net Rate Cap. With respect to
each Loan Group,
if (and to the extent that) the sum of (a) the principal
payments comprising
the Principal Remittance Amount for the related Distribution
Date and (b) the
Realized Losses, are insufficient to make the necessary
reductions of
principal on the LT-C and LT-D Interests, then interest will be
added to the
Loan Group's LT-E Interest.
(c) The outstanding aggregate LT-C and LT-D Interests for all
Loan
Groups will not be reduced below 1 percent of the excess of (i)
the aggregate
Stated Principal Balance of the Mortgage Loans for such
Distribution Date over
(ii) the Senior Certificates related to the 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 (f)
prevents the
distribution of principal to the LT-C and LT-D Interests of a
Loan Group, and
if the Loan Group's LT-E Interest has already been reduced to
zero, then the
excess principal from that Loan Group will be paid to the LT-E
Interest of the
other Loan Groups, the aggregate LT-C and LT-D Interests of
which are less
than one percent of the Adjusted Subordinated Portion. If the
Loan Group of
the LT-E 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 Lower Tier
REMIC as a Realized Loss. Conversely, if the Loan Group of the
LT-E 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 Lower Tier
REMIC as a
reimbursement for prior Realized Losses.
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<PAGE>
The following table specifies the Class designation, interest
rate, and
principal amount for each Class of Middle Tier REMIC
Interests:
-------------------------------------------------------------------------------
Middle Tier REMIC Initial Principal Interest Rate Corresponding
Master
Interest Balance REMIC Certificate
-------------------------------------------------------------------------------
MT-1-A-1 (1) (2) Class 1-A-1
-------------------------------------------------------------------------------
MT-1-A-2 (1) (2) Class 1-A-2
-------------------------------------------------------------------------------
MT-1-X-Accrual (1) (2) N/A
-------------------------------------------------------------------------------
MT-2-A-1 (3) (4) Class 2-A-1
-------------------------------------------------------------------------------
MT-2-A-2 (3) (4) Class 2-A-2
-------------------------------------------------------------------------------
MT-2-A-3 (3) (4) Class 2-A-3
-------------------------------------------------------------------------------
MT-2-A-4 (3) (4) Class 2-A-4
-------------------------------------------------------------------------------
MT-2-X-Accrual (3) (4) N/A
-------------------------------------------------------------------------------
MT-$100 $100.00 (1) Class A-R
-------------------------------------------------------------------------------
MT-M-1 (5) (6) Class M
-------------------------------------------------------------------------------
MT-M-2 (5) (6) Class M-2
-------------------------------------------------------------------------------
MT-M-3 (5) (6) Class M-3
-------------------------------------------------------------------------------
MT-M-4 (5) (6) Class M-4
-------------------------------------------------------------------------------
MT-M-5 (5) (6) Class M-5
-------------------------------------------------------------------------------
MT-M-6 (5) (6) Class M-6
-------------------------------------------------------------------------------
MT-M-7 (5) (6) Class M-7
-------------------------------------------------------------------------------
MT-M-8 (5) (6) Class M-8
-------------------------------------------------------------------------------
MT-B-1 (5) (6) Class B-1
-------------------------------------------------------------------------------
MT-B-2 (5) (6) Class B-2
-------------------------------------------------------------------------------
MT-B-3 (5) (6) Class B-3
-------------------------------------------------------------------------------
MT-B-4 (5) (6) Class B-4
-------------------------------------------------------------------------------
MT-B-5 (5) (6) Class B-5
-------------------------------------------------------------------------------
MT-MX-Accrual (5) (6) N/A
-------------------------------------------------------------------------------
MT-A-R (7) (7) N/A
-------------------------------------------------------------------------------
---------------
(1) This Middle Tier REMIC Interest has a principal balance that
is
initially equal to 50% of its Corresponding Certificate Class
issued by
the Master REMIC. Principal payments, both scheduled and
prepaid,
Realized Losses, Subsequent Recoveries and interest accruing on
the
MT-1-X-Accrual Interest will be allocated to this class to
maintain its
size relative to its Corresponding Certificate Class (that is,
50%) with
any excess payments of principal, Realized Losses and
Subsequent
Recoveries being allocated to the MT-1-X-Accrual Interest in
such manner
as to cause the principal balance of the MT-1-X
5
<PAGE>
Accrual Interest to have a principal balance equal to the
principal
balance of the Class MT-1-A-1 and Class MT-1-A-2 Interests (the
"MT-1-A
Interests" and together with the MT-1-X Accrual Interest, the
"MT-1
Interests") plus (b) 100% of the net deferred interest allocated
to the
Class 1-X Certificates.
(2) 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
Loan Group 1 (the "Group 1 Net Rate Cap").
(3) This Middle Tier REMIC Interest has a principal balance that
is
initially equal to 50% of its Corresponding Certificate Class
issued by
the Master REMIC. Principal payments, both scheduled and
prepaid,
Realized Losses, Subsequent Recoveries and interest accruing on
the
MT-2-X-Accrual Interest will be allocated to this class to
maintain its
size relative to its Corresponding Certificate Class (that is,
50%) with
any excess payments of principal, Realized Losses and
Subsequent
Recoveries being allocated to the MT-2-X-Accrual Interest in
such manner
as to cause the principal balance of the MT-2-X Accrual Interest
to have
a principal balance equal to the principal balance of the
Class
MT-2-A-1, Class MT-2-A-2, Class MT-2-A-3 and Class MT-2-A-4
Interests
(the "MT-2-A Interests" and together with the MT-2-X Accrual
Interest,
the "MT-2 Interests") plus (b) 100% of the net deferred
interest
allocated to the Class 2-X Certificates.
(4) 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
Loan Group 2 (the "Group 2 Net Rate Cap").
(5) This Middle Tier REMIC Interest has a principal balance that
is
initially equal to 50% of its Corresponding Certificate Class
issued by
the Master REMIC. Principal payments, both scheduled and
prepaid,
Realized Losses, Subsequent Recoveries and interest accruing on
the
MT-M-X-Accrual Interest will be allocated to this class to
maintain its
size relative to its Corresponding Certificate Class (that is,
50%) with
any excess payments of principal, Realized Losses and
Subsequent
Recoveries being allocated to the MT-M-X-Accrual Interest in
such manner
as to cause the principal balance of the MT-M-X Accrual Interest
to have
a principal balance equal to the principal balance of the Class
MT-M-1,
Class MT-M-2, Class MT-M-3, MT-M-4, Class MT-M-5, Class MT-M-6,
Class
MT-M-7, Class MT-M-8, Class MT-B-1, Class MT-B-2, Class MT-B-3,
Class
MT-B-4 and Class MT-B-5 Interests (the "MT-M and MT-B Interests"
and
together with the MT-M-X Accrual Interest, the "MT-S Interests")
plus
(b) 100% of the net deferred interest allocated to the Class
M-X
Certificates.
(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 Adjusted Subordinate Weighted Average
Rate.
(7) The MT-A-R is the sole Class of residual interest in the
Middle Tier
REMIC. It pays no interest or principal.
6
<PAGE>
On each Distribution Date, the Available Funds payable with
respect to
the Lower Tier REMIC Interest (other than the Class LT-A-R
Interest) 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 Master
REMIC
Certificates, together with minimum denominations and integral
multiples in
excess thereof in which such Classes shall be issuable (except
that one
Certificate of each Class of Certificates may be issued in a
different amount
and, in addition, one Residual Certificate representing the Tax
Matters Person
Certificate may be issued in a different amount):
-------------------------------------------------------------------------------
Integral
Initial Class Pass-Through Multiples
Class Certificate Rate Minimum in Excess of
Designation Balance (per annum)* Denomination Minimum
-------------------------------------------------------------------------------
Class 1-A-1 $306,284,000.00 (1) $25,000.00 $1,000.00
-------------------------------------------------------------------------------
Class 1-A-2 $54,050,000.00 (1) $25,000.00 $1,000.00
-------------------------------------------------------------------------------
Class 1-X (2) (3) $25,000.00(4) $1,000.00
-------------------------------------------------------------------------------
Class 2-A-1 $385,993,000.00 (1) $25,000.00 $1,000.00
-------------------------------------------------------------------------------
Class 2-A-2 $160,830,000.00 (1) $25,000.00 $1,000.00
-------------------------------------------------------------------------------
Class 2-A-3 $121,773,000.00 (1) $25,000.00 $1,000.00
-------------------------------------------------------------------------------
Class 2-A-4 $117,988,000.00 (1) $25,000.00 $1,000.00
-------------------------------------------------------------------------------
Class 2-X (5) (6) $25,000.00(4) $1,000.00
-------------------------------------------------------------------------------
Class A-R(7) $100.00 (8) (9) (9)
-------------------------------------------------------------------------------
Class M-X (10) (11) $25,000.00(4) $1,000.00
-------------------------------------------------------------------------------
Class M-1 $14,919,000.00 (1) $25,000.00 $1,000.00
-------------------------------------------------------------------------------
Class M-2 $13,054,000.00 (1) $25,000.00 $1,000.00
-------------------------------------------------------------------------------
Class M-3 $8,081,000.00 (1) $25,000.00 $1,000.00
-------------------------------------------------------------------------------
Class M-4 $7,460,000.00 (1) $25,000.00 $1,000.00
-------------------------------------------------------------------------------
Class M-5 $6,216,000.00 (1) $25,000.00 $1,000.00
-------------------------------------------------------------------------------
7
<PAGE>
-------------------------------------------------------------------------------
Integral
Initial Class Pass-Through Multiples
Class Certificate Rate Minimum in Excess of
Designation Balance (per annum)* Denomination Minimum
-------------------------------------------------------------------------------
Class M-6 $6,216,000.00 (1) $25,000.00 $1,000.00
-------------------------------------------------------------------------------
Class M-7 $5,595,000.00 (1) $25,000.00 $1,000.00
-------------------------------------------------------------------------------
Class M-8 $4,937,000.00 (1) $25,000.00 $1,000.00
-------------------------------------------------------------------------------
Class B-1 $4,351,000.00 (1) $25,000.00 $1,000.00
-------------------------------------------------------------------------------
Class B-2 $4,351,000.00 (1) $25,000.00 $1,000.00
-------------------------------------------------------------------------------
Class B-3 $9,325,000.00 (1) $100,000.00 $1,000.00
-------------------------------------------------------------------------------
Class B-4 $6,838,000.00 (1) $100,000.00 $1,000.00
-------------------------------------------------------------------------------
Class B-5 $4,974,816.00 (1) $100,000.00 $1,000.00
-------------------------------------------------------------------------------
Class C $100.00 (12) (13) N/A
-------------------------------------------------------------------------------
------------------------------------
* For federal income tax purposes, the entitlement of any
Certificate to
any Corridor Contract payment and Carryover Shortfall Amount and
the
entitlement of the Class M and Class B Certificates to any
interest in excess
of the Adjusted Subordinate Weighted Average Rate shall be
treated as
described in Section 8.11. hereof.
(1) The Pass-Through Rate for the LIBOR Certificates for each
Interest
Accrual Period related to each Distribution Date will be a per
annum
rate equal to the least of (a) LIBOR plus the applicable
Pass-Through
Margin for such Class, (b) the related Net WAC Cap and (c)
10.50%. The
per annum Pass-Through Rates for the LIBOR Certificates for the
Interest
Accrual Period related to the first Distribution Date are:
-----------------------------
Initial
Class of LIBOR Pass-Through
Certificates Rate
-----------------------------
Class 1-A-1...... 2.87875%
Class 1-A-2...... 2.94875%
Class 2-A-1...... 2.87875%
Class 2-A-2...... 2.91875%
Class 2-A-3...... 2.89875%
Class 2-A-4...... 2.95875%
Class M-1........ 3.02875%
Class M-2........ 3.05875%
Class M-3........ 3.08875%
Class M-4........ 3.28875%
Class M-5........ 3.35875%
Class M-6........ 3.42875%
Class M-7........ 3.80875%
Class M-8........ 3.85875%
Class B-1........ 4.20875%
Class B-2........ 4.20875%
Class B-3........ 4.20875%
Class B-4........ 4.20875%
Class B-5........ 4.20875%
-----------------------------
8
<PAGE>
(2) The Class 1-X Certificates initially will have no Class
Certificate
Balance and will bear interest on the Component Notional Amount
of the
Class 1-X IO Component (initially $360,334,000).
(3) Interest will accrue with respect to the Class 1-X
Certificates for each
Interest Accrual Period related to each Distribution Date in an
amount
equal to the sum of the interest accrued on the Class 1-X IO
Component
(based upon the Component Notional Amount) and the Class 1-X P
Component
(based upon the Component Principal Balance) at its
respective
Pass-Through Rate for that Distribution Date. For income tax
purposes,
the Class 1-X Certificates are entitled to, for each Interest
Accrual
Period, the "Class 1-X Distributable Amount," which is a
specified
portion of the interest on the MT-1 Interests equal to the
excess of the
Loan Group 1 Net Rate Cap over the product of two and the
weighted
average interest rate of the MT-1 Interests with each Interest
(other
than the Class 1-X-Accrual Interest) subject to a cap equal to
the
Pass-Through Rate of the corresponding Certificate Class and
the
MT-1-X-Accrual Interest subject to a cap of 0.00%. The
Pass-Through Rate
of the Class 1-X Certificates shall be a rate sufficient to
entitle the
Class 1-X Certificate to all interest accrued on the MT-1
Interests less
the interest accrued on the Class 1-A Certificates. The Class
1-X
Distributable Amount for any Distribution Date is payable from
current
interest on the Group 1 Mortgage Loans.
(4) Minimum denomination is based on the Notional Amount of such
Class.
(5) The Class 2-X Certificates initially will have no Class
Certificate
Balance and will bear interest on the Component Notional Amount
of the
Class 2-X IO Component (initially $786,584,000).
(6) Interest will accrue with respect to the Class 2-X
Certificates for each
Interest Accrual Period related to each Distribution Date in an
amount
equal to the sum of the interest accrued on the Class 2-X IO
Component
(based upon the Component Notional Amount) and the Class 2-X P
Component
(based upon the Component Principal Balance) at its
respective
Pass-Through Rate for that Distribution Date. For income tax
purposes,
the Class 2-X Certificates are entitled to, for each Interest
Accrual
Period, the "Class 2-X Distributable Amount," which is a
specified
portion of the interest on the MT-2 Interests equal to the
excess of the
Loan Group 2 Net Rate Cap over the product of two and the
weighted
average interest rate of the MT-2 Interests with each Interest
(other
than the Class 2-X-Accrual Interest) subject to a cap equal to
the
Pass-Through Rate of the corresponding Certificate Class and
the
2-X-Accrual Interest subject to a cap of 0.00%. The Pass-Through
Rate of
the Class 2-X Certificates shall be a rate sufficient to entitle
the
Class 2-X Certificate to all interest accrued on the MT-2
Interests less
the interest accrued on the Class 2-A Certificates. The Class
2-X
Distributable Amount for any Distribution Date is payable from
current
interest on the Group 2 Mortgage Loans.
(7) The Class A-R Certificates represent the sole Class of
residual interest
in the Master REMIC.
(8) The Pass-Through Rate for the Class A-R Certificates for the
Interest
Accrual Period related to each Distribution Date will be a per
annum
rate equal to the Weighted Average Adjusted Net Mortgage Rate of
the
Group 1 Mortgage Loans. The Pass-Through Rate for the Class
A-R
Certificates for the Interest Accrual Period related to the
first
Distribution Date will be 1.3221% per annum.
(9) 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.
9
<PAGE>
(10) The Class M-X Certificates initially will have no Class
Certificate
Balance and will bear interest on the Component Notional Amount
of the
Class M-X IO Component (initially $96,353,816).
(11) Interest will accrue with respect to the Class M-X
Certificates for each
Interest Accrual Period related to each Distribution Date in an
amount
equal to the sum of the interest accrued on the Class M-X IO
Component
(based upon the Component Notional Amount) and the Class M-X P
Component
(based upon the Component Principal Balance) at its
respective
Pass-Through Rate for that Distribution Date. For income tax
purposes,
the Class M-X Certificates are entitled to, for each Interest
Accrual
Period, the "Class M-X Distributable Amount," which is a
specified
portion of the interest on the MT-S Interests equal to the
excess of the
Adjusted Subordinate Net Rate Cap over the product of two and
the
weighted average interest rate of the MT-S Interests with each
Interest
(other than the Class MT-MX-Accrual Interest) subject to a cap
equal to
the Pass-Through Rate of the corresponding Certificate Class and
the
MT-MX-Accrual Interest subject to a cap of 0.00%. The
Pass-Through Rate
of the Class M-X Certificates shall be a rate sufficient to
entitle the
Class M-X Certificate to all interest accrued on the MT-S
Interests less
the interest accrued on the Class M and Class B Certificates.
The Class
M-X Distributable Amount for any Distribution Date is payable
from
current interest on the Mortgage Loans in Group 1 and Group
2.
(12) The Class C Certificates will not be entitled to payments
of interest
but will be entitled to receive distributions as provided in
Section
9.04 hereof.
(13) The Class C Certificates will be issued as a single
certificate with an
initial Certificate Balance of $100.00.
It is not intended that the Class A-R Certificates be entitled
to any
cash flows pursuant to this agreement except as provided in
Sections
4.02(a)(1)(ii) and (iv)(y)(A) hereunder, (that is, its
entitlement to $100
plus interest thereon).
10
<PAGE>
Set forth below are designations of Classes or Components of
Certificates
and other defined terms to the categories used in this
Agreement:
Accretion Directed
Certificates............ None.
Accretion Directed
Components.............. None.
Accrual Certificates.... None.
Accrual Components...... None.
Book-Entry Certificates. All Classes of Certificates other than
the Physical
Certificates.
Class X Certificates.... Class 1-X, Class 2-X and Class M-X
Certificates.
COFI Certificates....... None.
Component Certificates.. Class 1-X, Class 2-X and Class M-X
Certificates.
Components.............. The Class 1-X Certificates are
comprised of the
Class 1-X IO Component and the Class 1-X P
Component. The Class 2-X Certificates are comprised
of the Class 2-X IO Component and the Class 2-X P
Component. The Class M-X Certificates are comprised
of the Class M-X IO Component and the Class M-X P
Component. Each Component will have the Initial
Component Principal Balance or Component Notional
Amount, as applicable, and Pass-Through Rate set
forth below:
Initial Initial
Component Component Pass-
Principal Notional Through
Designation Balance Amount Rate
----------- --------- --------- -------
Class 1-X IO Component N/A $360,334,000 (1)
Class 1-X P Component $0 N/A (2)
Class 2-X IO Component N/A $786,584,000 (3)
Class 2-X P Component $0 N/A (4)
Class M-X IO Component N/A $96,353,816 (5)
Class M-X P Component $0 N/A (6)
------------
(1) For the Interest Accrual Period related to each
Distribution Date, a per annum rate equal to the
excess, if any, of (i) the Weighted Average
Adjusted Net Mortgage Rate of the Mortgage Loans in
Loan Group 1 over (ii) the weighted average of the
Pass-Through Rates of the Class 1-A-1 and Class
1-A-2 Certificates (as adjusted to reflect the
accrual of interest on the basis of a 360-day year
consisting of twelve 30-day months) for their
corresponding Interest Accrual Period (which in the
case of the first Interest Accrual Period will be
calculated assuming an Interest Accrual Period that
begins on the Closing Date). The Pass-
11
<PAGE>
Through Rate for the Class 1-X IO Component for the
Interest Accrual Period related to the first
Distribution Date is 0.00% per annum.
(2) For the Interest Accrual Period related to each
Distribution Date, a per annum rate equal to the
Weighted Average Adjusted Net Mortgage Rate of the
Mortgage Loans in Loan Group 1. The Pass-Through
Rate for the Class 1-X P Component for the Interest
Accrual Period related to the first Distribution
Date is 1.3221% per annum.
(3) For the Interest Accrual Period related to each
Distribution Date, a per annum rate equal to the
excess, if any, of (i) the Weighted Average
Adjusted Net Mortgage Rate of the Mortgage Loans in
Loan Group 2 over (ii) the weighted average of the
Pass-Through Rates of the Class 2-A-1, Class 2-A-2,
Class 2-A-3 and Class 2-A-4 Certificates (as
adjusted to reflect the accrual of interest on the
basis of a 360-day year consisting of twelve 30-day
months) for their corresponding Interest Accrual
Period (which in the case of the first Interest
Accrual Period will be calculated assuming an
Interest Accrual Period that begins on the Closing
Date). The Pass-Through Rate for the Class 2-X IO
Component for the Interest Accrual Period related
to the first Distribution Date is 0.00% per annum.
(4) For the Interest Accrual Period related to each
Distribution Date, a per annum rate equal to the
Weighted Average Adjusted Net Mortgage Rate of the
Mortgage Loans in Loan Group 2. The Pass-Through
Rate for the Class 2-X P Component for the Interest
Accrual Period related to the first Distribution
Date is 1.9427% per annum.
(5) For the Interest Accrual Period related to each
Distribution Date, a per annum rate equal to the
excess, if any, of (i) the Subordinate Weighted
Average Rate over (ii) the weighted average of the
Pass-Through Rates of the Subordinate Certificates
(as adjusted to reflect the accrual of interest on
the basis of a 360-day year consisting of twelve
30-day months) for their corresponding Interest
Accrual Period (which in the case of the first
Interest Accrual Period will be calculated assuming
an Interest Accrual Period that begins on the
Closing Date). The Pass-Through Rate for the Class
M-X IO Component for the Interest Accrual Period
related to the first Distribution Date is 0.00% per
annum.
(6) For the Interest Accrual Period related to each
Distribution Date, a per annum rate equal to the
Subordinate Weighted Average Rate (as adjusted to
reflect the accrual of interest on the basis of a
360-day year consisting of twelve 30-day months).
The Pass-Through Rate for the Class M-X P Component
for the Interest Accrual Period related to the
first Distribution Date is 1.7477% per annum.
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 any Certificate of a Class that does not or no
longer satisfies the applicable rating requirement
under the Underwriter's Exemption.
12
<PAGE>
Group 1 Senior
Certificates............ Class 1-A-1, Class 1-A-2, Class 1-X and
Class A-R
Certificates.
Group 1 Certificates.... Group 1 Senior Certificates and the
Subordinated
Portion related to Loan Group 1.
Group 2 Senior
Certificates ........... Class 2-A-1, Class 2-A-2, Class 2-A-3,
Class 2-A-4
and Class 2-X Certificates.
Group 2 Certificates.... Group 2 Senior Certificates and the
Subordinated
Portion related to Loan Group 2.
LIBOR Certificates...... Class 1-A-1, Class 1-A-2, Class 2-A-1,
Class 2-A-2,
Class 2-A-3, Class 2-A-4, Class M-1, Class M-2,
Class M-3, Class M-4, Class M-5, Class M-6, Class
M-7, Class M-8, Class B-1, Class B-2, Class B-3,
Class B-4 and Class B-5 Certificates.
Non-Delay Certificates.. LIBOR Certificates.
Notional Amount
Certificates............ None.
Notional Amount
Components.............. Class 1-X IO, Class 2-X IO and Class
M-X IO
Components.
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.
Principal and Interest
Components.............. Class 1-X P, Class 2-X P and Class M-X
P Components.
Principal Only
Certificates............ None.
Private Certificates.... Class B-3, Class B-4, Class B-5 and
Class C
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.
13
<PAGE>
Scheduled Principal
Classes................. None.
Senior Certificate
Group................... Group 1 Senior Certificates and Group 2
Senior
Certificates, as applicable.
Senior Certificates..... Collectively, the Group 1 Senior
Certificates and
the Group 2 Senior Certificates.
Subordinated
Certificates............ Class M-X, Class M-1, Class M-2, Class
M-3, Class
M-4, Class M-5, Class M-6, Class M-7, Class M-8,
Class B-1, Class B-2, Class B-3, Class B-4 and
Class B-5 Certificates.
Targeted Principal
Classes................. None.
Underwriter............. Bear, Stearns & Co. Inc.
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.
14
<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: With respect to any Class of Accrual
Certificates or any
Accrual Components and any Distribution Date prior to the
related Accrual
Termination Date, the amount allocable to interest on such Class
of Accrual
Certificates or Accrual Components with respect to such
Distribution Date
pursuant to Section 4.02(a).
Accrual Certificates: As specified in the Preliminary
Statement.
Accrual Components: As specified in the Preliminary
Statement.
Accrual Termination Date: Not applicable.
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.
Adjusted Cap Rate: The Group 1 Adjusted Cap Rate, the Group 2
Adjusted
Cap Rate or the Subordinated Adjusted Cap Rate, as the context
requires.
Adjusted Subordinated Portion: With respect to any Distribution
Date,
the sum of the following for each Loan Group: (i) the Loan Group
Principal
Balance as of the first day of the related Due Period (after
giving effect to
Principal Prepayments received in the Prepayment Period ending
during such Due
Period) less (ii) the sum of (a) any Net Deferred Interest
allocated to the
Class X Certificates corresponding to that Loan Group and (b)
the aggregate
Class Certificate Balance of the related Classes of Senior
Certificates, in
each case immediately prior to such Distribution Date.
Adjusted Subordinate Weighted Average Rate: For each
Distribution Date,
the weighted average of the Group 1 Adjusted Cap Rate and the
Group 2 Adjusted
Cap Rate, weighted on the basis of the respective Adjusted
Subordinated
Portion of their corresponding Loan Groups. For federal income
tax purposes,
the Adjusted Subordinate Weighted Average Rate will be the
Calculation Rate in
respect of the Class C and Class D Interests in the Lower Tier
REMIC.
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
<PAGE>
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 on such REO
Property), less
the aggregate amount of any such delinquent payments that the
Master Servicer
has determined would constitute a Nonrecoverable Advance if
advanced.
Aggregate Planned Balance: With respect to any group of
Planned
Principal Classes or Components and any Distribution Date, the
amount set
forth for such group for such Distribution Date in Schedule V
hereto.
Aggregate 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 of the Mortgage
Loans as of the
Due Date in the month preceding the month of such Distribution
Date (after
giving effect to Principal Prepayments received in the
Prepayment Period
related to that prior Due Date).
Aggregate Targeted Balance: With respect to any group of
Targeted
Principal Classes or Components and any Distribution Date, the
amount set
forth for such group for such Distribution Date in Schedule V
hereto.
Agreement: This Pooling and Servicing Agreement and all
amendments or
supplements to this Pooling and Servicing Agreement.
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 a Senior
Termination Date,
pursuant to clause (i) of the definition of Class Optimal
Interest
Distribution Amount (without giving effect to any reduction of
such amount
pursuant to Section 4.02(d)) bears to the 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 Mortgage Loans in that Loan Group
and (ii) all
Scheduled Payments due after the related Due Date relating to
Mortgage Loans
in that Loan Group.
Applicable Credit Support Percentage: As defined in Section
4.02(e).
2
<PAGE>
Appraised Value: With respect to any Mortgage Loan, the
Appraised Value
of the related Mortgaged Property shall be: (i) with respect to
a Mortgage
Loan other than a Refinancing Mortgage Loan, the lesser of (a)
the value of
the Mortgaged Property based upon the appraisal made at the time
of the
origination of such Mortgage Loan and (b) the sales price of the
Mortgaged
Property at the time of the origination of such Mortgage Loan;
(ii) with
respect to a Refinancing Mortgage Loan other than a Streamlined
Documentation
Mortgage Loan, the value of the Mortgaged Property based upon
the appraisal
made-at the time of the origination of such Refinancing Mortgage
Loan; and
(iii) with respect to a Streamlined Documentation Mortgage Loan,
(a) if the
loan-to-value ratio with respect to the Original Mortgage Loan
at the time of
the origination thereof was 80% or less and the loan amount of
the new
mortgage loan is $650,000 or less, the value of the Mortgaged
Property based
upon the appraisal made at the time of the origination of the
Original
Mortgage Loan and (b) if the loan-to-value ratio with respect to
the Original
Mortgage Loan at the time of the origination thereof was greater
than 80% or
the loan amount of the new mortgage loan being originated is
greater than
$650,000, the value of the Mortgaged Property based upon the
appraisal (which
may be a drive-by appraisal) made at the time of the origination
of such
Streamlined Documentation Mortgage Loan.
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
for such Class on the related Subordinated Portion immediately
prior to that
Distribution Date.
Auction Excess Proceeds: With respect to a Successful Auction,
the
excess of the purchase price paid by the Winning Bidder over the
Minimum Bid
Price.
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 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)-(v) 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 a Senior
Termination
Date, Available Funds with respect to the Loan Group relating to
the remaining
Senior Certificate Group shall include the Available Funds from
the other Loan
Group and on any Distribution Date thereafter, Available Funds
shall be
calculated based upon all the Mortgage Loans in the Mortgage
Pool, as opposed
to the Mortgage Loans in the related Loan Group.
Bankruptcy Code: The United States Bankruptcy Reform Act of
1978, as
amended.
Bid Date: As specified in Section 9.04(b).
Book-Entry Certificates: As specified in the Preliminary
Statement.
3
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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, (a) 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, and (b)
in the case of the Class C and Class D Lower Tier REMIC
Interests, the product
of (i) 10 and (ii) the weighted average rate of the outstanding
Class C and
Class D Interests, treating each Class C Interest as capped at
zero or reduced
by a fixed percentage of 100% of the interest accruing on such
Class C
Interest.
Carryover Shortfall Amount: For any Class of LIBOR Certificates
and any
Distribution Date on which the Pass-Through Rate for such Class
is based upon
the related Net WAC Cap, the sum of (a) the excess, if any, of
(i) the amount
of interest such Class of Certificates would have been entitled
to receive on
such Distribution Date had the applicable Pass-Through Rate not
been subject
to the related Net WAC Cap, but subject to a maximum rate of
10.50% per annum,
over (ii) the amount of interest such Class of Certificates
received on such
Distribution Date based on the related Net WAC Cap (in each
case, prior to the
reduction for Net Deferred Interest and Net Interest Shortfalls)
and (b) the
unpaid portion of any such excess from prior Distribution Dates
(and interest
accrued thereon at the then applicable Pass-Through Rate on such
Class of
Certificates, without giving effect to the related Net WAC Cap,
but subject to
a maximum rate of 10.50% per annum).
Carryover Shortfall Reserve Fund: The separate fund created
and
initially maintained by the Trustee pursuant to Section 3.05(g)
in the name of
the Trustee for the benefit of the Holders of the LIBOR
Certificates and the
Class X Certificates and designated "The Bank of New York in
trust for
registered holders of CWMBS, Inc., CHL Mortgage Pass-Through
Trust 2005-2,
Mortgage Pass-Through Certificates, Series 2005-2." Funds in the
Carryover
Shortfall Reserve Fund shall be held in trust for the Holders of
the LIBOR
Certificates and the Class X Certificates for the uses and
purposes set forth
in this Agreement.
Certificate: Any one of the Certificates executed by the Trustee
in
substantially the forms attached this Agreement as exhibits.
Certificate Account: The separate Eligible Account or Accounts
created
and maintained by the Master Servicer pursuant to Section 3.05
with a
depository institution 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 2005-2, Mortgage Pass-Through Certificates
Series 2005-2."
Certificate Balance: With respect to any Certificate (other than
any
Notional Amount Component) 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
4
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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 Subordinated Certificates, all other reductions in
Certificate Balance
previously allocated to that Certificate pursuant to Section
4.04 without
duplication, and (C) increased by the amount of Net Deferred
Interest for the
related Loan Group previously allocated to the applicable Class
pursuant to
Section 4.03.
Certificate Group: The Group 1 Certificates or Group 2
Certificates,
as the context requires.
Certificate Owner: With respect to a Book-Entry Certificate, the
Person
who is the beneficial owner of such Book-Entry Certificate. For
the purposes
of this Agreement, in order for a Certificate Owner to enforce
any of its
rights 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 C Distribution Account: The separate Eligible Account
created and
maintained by the Trustee pursuant to Section 3.05(h) in the
name of the
Trustee for the benefit of the Class C Certificateholders and
designated "The
Bank of New York in trust for registered holders of CHL Mortgage
Pass-Through
Trust 2005-2 Mortgage Pass-Through Certificates, Series 2005-2,
Class C."
Funds in the Class C Distribution Account shall be held in trust
for the Class
C Certificateholders for the uses and purposes set forth in this
Agreement.
Class Certificate Balance: With respect to any Class and as to
any date
of determination, the aggregate of the Certificate Balances of
all
Certificates of such Class as of such date.
Class Interest Shortfall: As to any Distribution Date and Class,
the
amount by which the amount described in clause (i) of the
definition of Class
Optimal Interest Distribution Amount for such Class exceeds the
amount of
interest actually distributed on such Class on such Distribution
Date pursuant
to such clause (i).
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<PAGE>
Class Optimal Interest Distribution Amount: With respect to
any
Distribution Date and interest-bearing Class or Component, the
sum of (i) one
month's interest accrued during the related Interest Accrual
Period at the
Pass-Through Rate for such Class or Component on the related
Class Certificate
Balance, Component Principal Balance, Notional Amount or
Component Notional
Amount, as applicable, immediately prior to such Distribution
Date, subject to
reduction as provided in Section 4.02(d) and (ii) any Class
Unpaid Interest
Amounts for such Class or Component (other than any Carryover
Shortfall
Amounts), reduced by any Net Deferred Interest for the related
Distribution
Date added to their respective Class Certificate Balances or
Component
Principal Balances, as applicable, as described in Section
4.03.
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 (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 of
interest-bearing Certificates or any interest-bearing Component,
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: January 31, 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, an amount
equal to
one-half of the aggregate Master Servicing Fee for that
Distribution Date.
Component: As specified in the Preliminary Statement.
Component Balance: Not applicable.
Component Certificates: As specified in the Preliminary
Statement.
Component Notional Amount: With respect to any Distribution Date
and (i)
the Class 1-X IO Component, the aggregate Class Certificate
Balance of the
Class 1-A-1 and Class 1-A-2 Certificates immediately prior to
such
Distribution Date, (ii) the Class 2-X IO Component, the
aggregate Class
Certificate Balance of the Class 2-A-1, Class 2-A-2, Class 2-A-3
and Class
2-A-4 Certificates immediately prior to such Distribution Date,
and (iii) the
Class M-X IO Component, the aggregate Class Certificate Balance
of the
Subordinated Certificates immediately prior to such Distribution
Date.
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<PAGE>
Component Principal Balance: As of any date of determination,
the Class
1-X P, Class 2-X P and Class M-X P Component will each have a
Component
Principal Balance equal to (i) the aggregate Net Deferred
Interest allocated
to such Component prior to the Determination Date pursuant to
Section 4.03
minus (ii) all amounts actually distributed as principal of such
Component and
all Realized Losses applied in reduction of principal of such
Component on all
prior Distribution Dates plus (iii) any increase in the
Component Principal
Balance of such Component pursuant to Section 4.02 due to the
receipt of
Subsequent Recoveries. As of the Closing Date, the Component
Principal Balance
of each of the Class 1-X P, Class 2-X P and Class M-X P
Components will equal
$0.
Component Rate: Not applicable.
Confirmation: That certain confirmation, reference number
FXCW052C1,
dated January 31, 2005, executed by the Trustee and the Corridor
Contract
Counterparty evidencing an interest rate corridor transaction
entered into for
the benefit of the LIBOR Certificates, among the Underwriter,
the Trustee and
the Corridor Contract Counterparty, including the exhibits
thereto and as
amended, modified or supplemented from time to time, the initial
form of which
is attached hereto as Exhibit R.
Coop Shares: Shares issued by a Cooperative Corporation.
Cooperative Corporation: The entity that holds title (fee or
an
acceptable leasehold estate) to the real property and
improvements
constituting the Cooperative Property and which governs the
Cooperative
Property, which Cooperative Corporation must qualify as a
Cooperative Housing
Corporation under Section 216 of the Code.
Cooperative Loan: Any Mortgage Loan secured by Coop Shares and
a
Proprietary Lease.
Cooperative Property: The real property and improvements owned
by the
Cooperative Corporation, including the allocation of individual
dwelling units
to the holders of the Coop Shares of the Cooperative
Corporation.
Cooperative Unit: A single family dwelling located in a
Cooperative
Property.
Corporate Trust Office: The designated office of the Trustee in
the
State of New York at which at any particular time its corporate
trust business
with respect to this Agreement shall be administered, which
office at the date
of the execution of this Agreement is located at 101 Barclay
Street, 8W, New
York, New York 10286 (Attn: Mortgage-Backed Securities Group,
CWMBS, Inc.
Series 2005-2, facsimile no. (212) 815-3986), and which is the
address to
which notices to and correspondence with the Trustee should be
directed.
Corridor Contract: The interest rate corridor transaction
evidenced by
the Confirmation.
Corridor Contract Counterparty: Bear Stearns Financial Products
Inc.,
and its successors.
Corridor Contract Termination Date: The Distribution Date in May
2013.
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<PAGE>
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 (1) the Class A and Class B Lower Tier REMIC
Interests, a
situation in which the Class A and Class B Interests
corresponding to any Loan
Group are in the aggregate less than 1% of the Subordinated
Portion of the
Loan Group to which they correspond and (2) the Class C and
Class D Lower Tier
REMIC Interests, a situation in which the Class C and Class D
Interests
corresponding to any Loan Group are in the aggregate less than
1% of the
Adjusted Subordinated Portion of the Loan Group to which they
correspond.
Cut-off Date: As to any Mortgage Loan, the later of the date
of
origination of that Mortgage Loan and January 1, 2005.
Cut-off Date Pool Principal Balance: $1,243,271,915.73.
Cut-off Date Principal Balance: As to any Mortgage Loan, the
Stated
Principal Balance thereof as of the close of business on the
Cut-off Date.
Debt Service Reduction: With respect to any Mortgage Loan, a
reduction
by a court of competent jurisdiction in a proceeding under the
Bankruptcy Code
in the Scheduled Payment for such Mortgage Loan that became
final and
non-appealable, except such a reduction resulting from a
Deficient Valuation
or any reduction that results in a permanent forgiveness of
principal.
Defective Mortgage Loan: Any Mortgage Loan that is required to
be
repurchased pursuant to Section 2.02 or 2.03.
Deferred Interest: With respect to any Mortgage Loan and Due
Date, the
amount of interest accrued on such Mortgage Loan at the
applicable Mortgage
Rate that is greater than the Scheduled Payment due on such
Mortgage Loan on
that related Due Date and that is added to the principal balance
of such
Mortgage Loan in accordance with the terms of the related
Mortgage Note.
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.
8
<PAGE>
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 Home Loans Servicing LP shall be in possession of
any Mortgage
Files with respect to any Delay Delivery Mortgage Loan, until
delivery of such
Mortgage File to the Trustee as provided in Section 2.01,
Countrywide Home
Loans Servicing LP shall hold such files as Master Servicer
hereunder, as
agent and in trust for the Trustee.
Deleted Mortgage Loan: As defined in Section 2.03(c).
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 next
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
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
2005-2 Mortgage Pass-Through Certificates, Series 2005-2." 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.
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<PAGE>
Distribution Date: The 25th day of each calendar month after the
initial
issuance of the Certificates, or if such 25th day is not a
Business Day, the
next succeeding Business Day, commencing in February 2005.
Due Date: With respect to a Mortgage Loan, the date on which
Scheduled
Payments are due on that Mortgage Loan. With respect to any
Distribution Date,
the related Due Date is the first day of the calendar month in
which that
Distribution Date occurs.
Due Period: With respect to a Mortgage Loan, the period
beginning on the
second day of the calendar month preceding the month in which
such
Distribution Date occurs and ending on the first day of the
calendar month in
which such 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.
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
received with
respect to such Mortgage Loan during the calendar month in which
such Mortgage
Loan became a Liquidated Mortgage Loan plus any Subsequent
Recoveries received
with respect to such Mortgage Loan, net of any amounts
previously reimbursed
to the Master Servicer as Nonrecoverable Advance(s) with respect
to such
10
<PAGE>
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: As to each Mortgage Loan and any Distribution Date,
the
product of the Expense Fee Rate and its Stated Principal Balance
as of that
Distribution Date.
Expense Fee Rate: As to each Mortgage Loan and any date of
determination, the Master Servicing 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 Adjusted Cap Rate: For any Distribution Date, the
excess, if
any, of the Net Rate Cap for the Group 1 Mortgage Loans for that
Distribution
Date, over a fraction expressed as a percentage, the numerator
of which is
equal to the product of (i) a fraction, the numerator of which
is 360, and the
denominator of which is the actual number of days that elapsed
in the related
Interest Accrual Period, and (ii) the Net Deferred Interest for
Loan Group 1
for that Distribution Date, and the denominator of which is the
aggregate
Stated Principal Balance of the Mortgage Loans in Loan Group 1
at the end of
the Prepayment Period related to the immediately preceding
Distribution Date.
Group 1 Senior Certificates: As specified in the Preliminary
Statement.
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<PAGE>
Group 2 Adjusted Cap Rate: For any Distribution Date, the
excess, if
any, of the Net Rate Cap for the Group 2 Mortgage Loans for that
Distribution
Date, over a fraction expressed as a percentage, the numerator
of which is
equal to the product of (i) a fraction, the numerator of which
is 360, and the
denominator of which is the actual number of days that elapsed
in the related
Interest Accrual Period, and (ii) the Net Deferred Interest for
Loan Group 2
for that Distribution Date, and the denominator of which is the
aggregate
Stated Principal Balance of the Mortgage Loans in Loan Group 2
at the end of
the Prepayment Period related to the immediately preceding
Distribution Date.
Group 2 Senior Certificates: As specified in the Preliminary
Statement.
Index: With respect to any Interest Accrual Period for the
COFI
Certificates, if any, the then-applicable index used by the
Trustee pursuant
to Section 4.07 to determine the applicable Pass-Through Rate
for such
Interest Accrual Period for the COFI Certificates.
Indirect Participant: A broker, dealer, bank or other
financial
institution or other Person that clears through or maintains a
custodial
relationship with a Depository Participant.
Initial Certification: As defined in Section 2.02(a).
Initial Component Principal Balance: As specified in the
Preliminary
Statement.
Insurance Policy: With respect to any Mortgage Loan included in
the
Trust Fund, any insurance policy, including all riders and
endorsements
thereto in effect, including any replacement policy or policies
for any
Insurance Policies.
Insurance Proceeds: Proceeds paid by an insurer pursuant to
any
Insurance Policy, in each case other than any amount included in
such
Insurance Proceeds in respect of Insured Expenses.
Insured Expenses: Expenses covered by an Insurance Policy or any
other
insurance policy with respect to the Mortgage Loans.
Interest Accrual Period: With respect to each Class of Delay
Certificates, its corresponding Subsidiary REMIC Regular
Interest and any
Distribution Date, the calendar month prior to the month of such
Distribution
Date. With respect to any Class of Non-Delay Certificates, its
corresponding
Subsidiary REMIC Regular Interest and any Distribution Date, the
period
commencing on the Distribution Date in the month preceding the
month in which
such Distribution Date occurs (other than the first Distribution
Date, for
which it is the Closing Date) and ending on day immediately
preceding that
Distribution Date.
Interest Determination Date: With respect to (a) any Interest
Accrual
Period for any LIBOR Certificates and (b) any Interest Accrual
Period for the
COFI Certificates for which the applicable Index is LIBOR, the
second Business
Day prior to the first day of such Interest Accrual Period.
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.
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<PAGE>
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.
Loan Group: Loan Group 1 or 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 Group Principal Balance: As to any Distribution Date and
Loan
Group, the aggregate Stated Principal Balance of the Mortgage
Loans in that
Loan Group outstanding on the Due Date in the month preceding
the month of the
Distribution Date (after giving effect to Principal Prepayments
received in
the Prepayment Period related to such Due Date).
Loan-to-Value Ratio: With respect to any Mortgage Loan and as to
any
date of determination, the fraction (expressed as a percentage)
the numerator
of which is the principal balance of the related Mortgage Loan
at 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.
Lower Tier REMIC: As described in the Preliminary Statement.
Lower Tier REMIC Interest: Any one of the Lower Tier REMIC
Interests or
the LT-A-R Interest.
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<PAGE>
Lower Tier REMIC Regular Interest: Any one of the "regular
interests" in
the Lower Tier REMIC described in the Preliminary Statement.
LT-A-R Interest: The sole Class of "residual interest" in the
Lower Tier
REMIC.
Maintenance: With respect to any Cooperative Unit, the rent paid
by the
Mortgagor to the Cooperative Corporation pursuant to the
Proprietary Lease.
Majority in Interest: As to any Class of Regular Certificates,
the
Holders of Certificates of such Class evidencing, in the
aggregate, at least
51% of the Percentage Interests evidenced by all Certificates of
such Class.
Master REMIC: As described in the Preliminary Statement.
Master Servicer: Countrywide 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 18th day of each calendar
month, or
if such 18th day is not a Business Day, the next succeeding
Business Day,
commencing in February 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,
0.375%
per annum.
Maximum Mortgage Rate: With respect to each Mortgage Loan,
the
percentage set forth in the related Mortgage Note as the maximum
Mortgage Rate
thereunder.
Maximum Negative Amortization: With respect to each Mortgage
Loan, the
percentage set forth in the related Mortgage Note as the
percentage of the
original principal balance of Mortgage Note, that if exceeded
due to Deferred
Interest, will result in a recalculation of the Scheduled
Payment so that the
then unpaid principal balance of the Mortgage Note will be fully
amortized
over the Mortgage Loan's remaining term to maturity.
MERS: Mortgage Electronic Registration Systems, Inc., a
corporation
organized and existing under the laws of the State of Delaware,
or any
successor to Mortgage Electronic Registration Systems, Inc.
MERS Mortgage Loan: Any Mortgage Loan registered with MERS on
the
MERS(R) System.
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<PAGE>
MERS(R) System: The system of recording transfers of
mortgages
electronically maintained by MERS.
MiddleTier REMIC: As described in the Preliminary Statement.
Middle Tier REMIC Interest: Any one of the Middle Tier REMIC
Interests
or the MT-A-R Interest.
Middle Tier REMIC Regular Interest: Any one of the "regular
interests"
in the Middle Tier REMIC described in the Preliminary
Statement.
MIN: The mortgage identification number for any MERS Mortgage
Loan.
Minimum Bid Price: An amount equal to (1) the aggregate unpaid
Class
Certificate Balance of the Certificates, (2) interest accrued
and unpaid on
the Certificates (other than any Carryover Shortfall Amounts)
and (3) any
unreimbursed Advances, Servicing Advances, fees and expenses of
the Master
Servicer and the Trustee (including any expenses related to any
auctions).
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
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<PAGE>
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;
(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 on 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) a code indicating whether the Mortgage Loan is a
Countrywide
Mortgage Loan or a Park Granada Mortgage Loan;
(xvii) the direct servicer of such Mortgage Loan as of the
Cut-off
Date;
(xviii) a code indicating whether the Mortgage Loan is a
MERS
Mortgage Loan, and
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<PAGE>
(xix) with respect to each Mortgage Loan, the Gross Margin,
the
Mortgage Index, the Maximum Mortgage Rate, the Minimum
Mortgage
Rate, the first Adjustment Date, the Payment Adjustment Date
and
Maximum Negative Amortization 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 as from time to time
are
transferred and assigned to the Trustee pursuant to the
provisions of this
Agreement and that are held as a part of the Trust Fund
(including any REO
Property), the mortgage loans so held being identified in the
Mortgage Loan
Schedule, notwithstanding foreclosure or other acquisition of
title of the
related Mortgaged Property.
Mortgage Note: The original executed note or other evidence
of
indebtedness evidencing the indebtedness of a Mortgagor under a
Mortgage Loan.
Mortgage 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.
MT-A-R Interest: The sole Class of "residual interest" in the
Middle
Tier REMIC.
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 Deferred Interest: With respect to each Loan Group and
Distribution
Date, an amount equal to the excess, if any, of the Deferred
Interest that
accrued on the Mortgage Loans in that Loan Group for the related
Due Period
over the sum of the amounts described in clauses (a) through (f)
of the
definition of Principal Amount for those Mortgage Loans received
during the
related Due Period and Prepayment Period.
Net Payments: As to any Distribution Date and Loan Group, the
sum of the
Net Principal Payment Amount and the Net Principal Prepayment
Amount for such
Distribution Date and Loan Group.
Net Prepayment Interest Shortfalls: As to any Distribution Date
and Loan
Group, the amount by which the aggregate of Prepayment Interest
Shortfalls for
such Loan Group exceeds an amount equal to the sum of (a) the
Compensating
Interest for such Loan Group for such Distribution Date and (b)
the excess, if
any, of the Compensating Interest with respect to the Mortgage
Loans of each
other Loan Group for such Distribution Date over Prepayment
Interest
Shortfalls experienced by the Mortgage Loans in such other Loan
Groups during
such Prepayment Period.
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<PAGE>
Net Principal Payment Amount: As to any Distribution Date and
Loan
Group, the amount equal to the excess, if any, of the Principal
Payment Amount
for that Loan Group over the excess, if any, of (i) the Deferred
Interest for
that Loan Group for the related Due Period over (ii) the
Principal Prepayment
Amount for that Loan Group and Distribution Date.
Net Principal Prepayment Amount: As to any Distribution Date and
Loan
Group, the amount equal to the excess, if any, of the (i)
Principal Prepayment
Amount for that Loan Group over (ii) the aggregate amount of
Deferred Interest
accrued on the Mortgage Loans in that Loan Group for the related
Due Period.
Net WAC Cap: As to any Class of LIBOR Certificates, other than
the
Subordinated Certificates, the related Weighted Average Adjusted
Net Mortgage
Rate, adjusted for the related Interest Accrual Period. As to
any Class of
Subordinated Certificates, the Subordinate Weighted Average
Rate.
Non-Delay Certificates: As specified in the Preliminary
Statement.
Nonrecoverable Advance: Any portion of an Advance previously
made or
proposed to be made by the Master Servicer that, in the good
faith judgment of
the Master Servicer, will not be ultimately recoverable by the
Master Servicer
from the related Mortgagor, related Liquidation Proceeds or
otherwise.
Notice of Final Distribution: The notice to be provided pursuant
to
Section 9.02 to the effect that final distribution on any of the
Certificates
shall be made only upon presentation and surrender thereof.
Notional Amount: Not applicable.
Notional Amount Certificates: As specified in the
Preliminary
Statement.
Offered Certificates: As specified in the Preliminary
Statement.
Officer's Certificate: A certificate (i) in the case of the
Depositor,
signed by the Chairman of the Board, the Vice Chairman of the
Board, the
President, a Managing Director, a Vice President (however
denominated), an
Assistant Vice President, the Treasurer, the Secretary, or one
of the
Assistant Treasurers or Assistant Secretaries of the Depositor,
(ii) in the
case of the Master Servicer, signed by the President, an
Executive Vice
President, a Vice President, an Assistant Vice President, the
Treasurer, or
one of the Assistant Treasurers or Assistant Secretaries of
Countrywide GP,
Inc., its general partner or (iii) if provided for in this
Agreement, signed
by a Servicing Officer, as the case may be, and delivered to the
Depositor and
the Trustee, as the case may be, as required by this
Agreement.
Opinion of Counsel: A written opinion of counsel, who may be
counsel for
the Depositor, any 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, any Seller and the
Master
Servicer, (ii) not have any direct financial interest in the
Depositor, any
Seller or the Master Servicer or in any affiliate of either, and
(iii) not be
connected with the Depositor, any
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<PAGE>
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.
Optional Termination Date: The Distribution Date on which the
Pool
Stated Principal Balance is less than or equal to ten percent
(10%) of the
Cut-off Date Pool Principal Balance.
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-1..... 7.75%
Class M-2..... 6.55%
Class M-3..... 5.50%
Class M-4..... 4.85%
Class M-5..... 4.25%
Class M-6..... 3.75%
Class M-7..... 3.25%
Class M-8..... 2.80%
Class B-1..... 2.40%
Class B-2..... 2.05%
Class B-3..... 1.70%
Class B-4..... 0.95%
Class B-5..... 0.40%
Original Mortgage Loan: The mortgage loan refinanced in
connection
with the origination of a Refinancing Mortgage Loan.
Original Subordinate Principal Balance: On or prior to a
Senior
Termination Date, the Subordinated Percentage for a Loan Group
of the
aggregate Stated Principal Balance of the Mortgage Loans in such
Loan Group,
in each case as of the Cut-off Date or, if such date is after a
Senior
Termination Date, the aggregate of the Class Certificate
Balances of the
Subordinated Certificates as of the Closing Date.
OTS: The Office of Thrift Supervision.
Outside Reference Date: As to any Interest Accrual Period for
the COFI
Certificates, the close of business on the tenth day
thereof.
Outstanding: With respect to the Certificates as of any date
of
determination, all Certificates theretofore executed and
authenticated under
this Agreement except:
(i) Certificates theretofore canceled by the Trustee or
delivered
to the Trustee for cancellation; and
(ii) Certificates in exchange for which or in lieu of which
other
Certificates have been executed and delivered by the Trustee
pursuant to this Agreement.
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<PAGE>
Outstanding Mortgage Loan: As of any Due Date, a Mortgage Loan
with a
Stated Principal Balance greater than zero, which was not the
subject of a
Principal Prepayment in Full prior to the end of the related
Prepayment Period
and which did not become a Liquidated Mortgage Loan prior to the
end of the
related Prepayment Period.
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.
Pass-Through Margin: With respect to any Distribution Date and
each
Class of LIBOR Certificates, the per annum rate indicated in the
following
table:
Pass-Through Pass-Through
Class Margin (1) Margin (2)
----------------- ------------ ------------
Class 1-A-1...... 0.320% 0.640%
Class 1-A-2...... 0.390% 0.780%
Class 2-A-1...... 0.320% 0.640%
Class 2-A-2...... 0.360% 0.720%
Class 2-A-3...... 0.340% 0.680%
Class 2-A-4...... 0.400% 0.800%
Class M-1........ 0.470% 0.705%
Class M-2........ 0.500% 0.750%
Class M-3........ 0.530% 0.795%
Class M-4........ 0.730% 1.095%
Class M-5........ 0.800% 1.200%
Class M-6........ 0.870% 1.305%
Class M-7........ 1.250% 1.875%
Class M-8........ 1.300% 1.950%
Class B-1........ 1.650% 2.475%
Class B-2........ 1.650% 2.475%
Class B-3........ 1.650% 2.475%
Class B-4........ 1.650% 2.475%
Class B-5........ 1.650% 2.475%
--------------
(1) For the Interest Accrual Period related to any
Distribution
Date occurring on or prior to the Optional Termination Date.
(2) For each other Interest Accrual Period.
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.
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<PAGE>
Payment Adjustment Date: For each Mortgage Loan, the date
specified in
the related Mortgage Note as the annual date on which the
related Scheduled
Payment will be adjusted.
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.
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
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<PAGE>
(vii) such other relatively risk free investments bearing
interest
or sold at a discount acceptable to each Rating Agency as will
not
result in the downgrading or withdrawal of the rating then
assigned to the Certificates by either Rating Agency, as
evidenced
by a signed writing delivered by each Rating Agency
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 group of Planned Principal
Classes
or Components in the aggregate and any Distribution Date
appearing in Schedule
V hereto, the Aggregate Planned Balance for such group and
Distribution Date.
With respect to any other Planned Principal Class or Component
and any
Distribution Date appearing in Schedule V hereto, the applicable
amount
appearing opposite such Distribution Date for such Class or
Component.
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<PAGE>
Planned Principal Classes: As specified in the Preliminary
Statement.
Planned Principal Components: As specified in the
Preliminary
Statement.
Pool Stated Principal Balance: The aggregate of the Stated
Principal
Balances of the Outstanding Mortgage Loans.
Prepayment Interest Shortfall: As to any Distribution Date, any
Mortgage
Loan and any Principal Prepayment received in the portion of the
Prepayment
Period occurring in the calendar month prior to the month of
such Distribution
Date, the amount, if any, by which one month's interest at the
related
Mortgage Rate, net of the related Master Servicing Fee Rate, on
such Principal
Prepayment exceeds the amount of interest paid in connection
with such
Principal Prepayment.
Prepayment Period: As to any Distribution Date and the related
Due Date,
the period beginning on the second day of the calendar month
preceding the
month in which such Distribution Date occurs and ending on the
first day of
the calendar month in which such Distribution Date occurs.
Primary Insurance Policy: Each policy of primary mortgage
guaranty
insurance or any replacement policy therefor with respect to any
Mortgage
Loan.
Prime Rate: The prime commercial lending rate of The Bank of New
York,
as publicly announced to be in effect from time to time. The
Prime Rate shall
be adjusted automatically, without notice, on the effective date
of any change
in such prime commercial lending rate. The Prime Rate is not
necessarily The
Bank of New York's lowest rate of interest.
Principal 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 the related Loan Group on the related Due Date
to the extent
received or advanced, (b) the principal portion of the Purchase
Price of each
Mortgage Loan in the related Loan Group that was repurchased by
the applicable
Seller or purchased by the Master Servicer pursuant to this
Agreement as of
such Distribution Date, (c) the Substitution Adjustment Amount
in connection
with any Deleted Mortgage Loan in such Loan Group received with
respect to
such Distribution Date, (d) any Insurance Proceeds or net
Liquidation Proceeds
allocable to recoveries of principal of Mortgage Loans in the
related Loan
Group that are not yet Liquidated Mortgage Loans received during
the calendar
month preceding the month of such Distribution Date, (e) with
respect to each
Mortgage Loan in a Loan Group that became a Liquidated Mortgage
Loan during
the calendar month preceding the month of such Distribution
Date, the amount
of the net 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 and any Subsequent
Recoveries on the
Mortgage Loans in the related Loan Group received during the
calendar month
preceding the month of such Distribution Date and (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.
23
<PAGE>
Principal Payment Amount: As to any Distribution Date and any
Loan
Group, the sum of (i) the amounts described in clauses (a)
through (d) of the
definition of "Principal Amount" for such Distribution Date and
Loan Group.
Principal Prepayment: Any payment of principal by a Mortgagor on
a
Mortgage Loan that is received in advance of its scheduled Due
Date and is not
accompanied by an amount representing scheduled interest due on
any date or
dates in any month or months subsequent to the month of
prepayment. Partial
Principal Prepayments shall be applied by the Master Servicer in
accordance
with the terms of the related Mortgage Note.
Principal Prepayment Amount: As to any Distribution Date and any
Loan
Group, the sum of (i) the amount described in clauses (e) and
(f) of the
definition of "Principal Amount" for such Distribution Date and
Loan Group.
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
Subsidiary REMIC Regular Interests other than those of their
Corresponding
Loan Group as provided in the Preliminary Statement. Principal
Relocation
Payments shall be made of principal allocations comprising the
Principal
Remittance Amount from a Loan Group and shall also consist of a
proportionate
allocation of Realized Losses from the Mortgage Loans of a 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 August 24, 2004, generally
relating to
mortgage-pass through certificates to be sold by the
Depositor.
Prospectus Supplement: The prospectus supplement dated January
27, 2005
relating to the Offered Certificates.
PUD: Planned Unit Development.
Purchase Price: With respect to any Mortgage Loan required to
be
purchased by the applicable Seller pursuant to Section 2.02 or
2.03 or
purchased at the option of the Master Servicer pursuant to
Section 3.11, an
amount equal to the sum of (i) 100% of the unpaid
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<PAGE>
principal balance of the Mortgage Loan on the date of such
purchase, (ii)
accrued interest thereon at the applicable Mortgage Rate (or at
the applicable
Adjusted Mortgage Rate if (x) the purchaser is the Master
Servicer or (y) if
the purchaser is Countrywide and Countrywide is an affiliate of
the Master
Servicer) from the date through which interest was last paid by
the Mortgagor
to the Due Date in the month in which the Purchase Price is to
be distributed
to Certificateholders and (iii) costs and damages incurred by
the Trust Fund
in connection with a repurchase pursuant to Section 2.03 that
arises out of a
violation of any predatory or abusive lending law with respect
to the related
Mortgage Loan.
Qualified Bidder: Any nationally-recognized broker dealer other
than the
Seller, the Master Servicer and any of their respective
Affiliates.
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.
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<PAGE>
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, (i) in the
case of
the LIBOR Certificates represented by Book-Entry Certificates,
the Business
Day immediately preceding such Distribution Date and (ii) in the
case of LIBOR
Certificates represented by Definitive Certificates and in the
case of all
other Certificates, the close of business on the last Business
Day of the
month preceding the month in which such Distribution Date
occurs.
Reference Bank: As defined in Section 4.07.
Refinancing Mortgage Loan: Any Mortgage Loan originated in
connection
with the refinancing of an existing mortgage loan.
Regular Certificates: As specified in the Preliminary
Statement.
Relief Act: The Servicemembers Civil Relief Act or similar state
laws.
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.
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<PAGE>
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 Balances: Not applicable.
Scheduled Classes: As specified in the Preliminary
Statement.
Scheduled Payment: The scheduled monthly payment on a Mortgage
Loan due
on any Due Date allocable to principal and/or interest on such
Mortgage Loan
which, unless otherwise specified in this Agreement, shall give
effect to any
related Debt Service Reduction and any Deficient Valuation that
affects the
amount of the monthly payment due on such Mortgage Loan.
Securities Act: The Securities Act of 1933, as amended.
Seller: Countrywide or Park Granada, as applicable.
Senior Certificate Group: As specified in the Preliminary
Statement.
Senior Certificates: As specified in the Preliminary
Statement.
Senior Credit Support Depletion Date: The date on which the
Class
Certificate Balance of each Class of Subordinated Certificates
has been
reduced to zero.
Senior Percentage: As to any Senior Certificate Group and
Distribution
Date, the percentage equivalent of a fraction 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 any
related Notional
Amount Component) immediately prior to such Distribution Date
and the
denominator of which is the aggregate of the Stated Principal
Balances of each
Mortgage Loan in the related Loan Group as of the Due Date in
the month
preceding the month of that Distribution Date (after giving
effect to
Principal Prepayments received on the Mortgage Loans in the
Prepayment Period
related to that preceding Due Date); provided, however, that on
any
Distribution Date after a Senior Termination Date, the Senior
Percentage for
the Senior Certificates of the remaining Senior Certificate
Group is the
percentage equivalent of a fraction, the numerator of which is
the aggregate
of the Class Certificate Balances of each such Class of Senior
Certificates
(other than any related Notional Amount Component) immediately
prior to such
Distribution Date and the denominator of which is the aggregate
of the Class
Certificate Balances of all Classes of Certificates immediately
prior to such
Distribution Date. In no event will the 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
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<PAGE>
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
initial Senior Percentage of such Senior Certificate Group as of
the Closing
Date, in which case the Senior Prepayment Percentage for each
Senior
Certificate Group for such Distribution Date will once again
equal 100%).
Notwithstanding the foregoing, (i) no decrease in the Senior
Prepayment
Percentage will occur unless both of the Senior Step Down
Conditions are
satisfied with respect to each Loan Group and (ii) if the Two
Times Test is
satisfied on a Distribution Date, (a) on or before the
Distribution Date in
January 2008, the Senior Prepayment Percentage for each Senior
Certificate
Group will equal the related Senior Percentage plus 50% of the
Pro Rata
Subordinated Percentage and (b) after the Distribution Date in
January 2008,
the Senior Prepayment Percentage for each Senior Certificate
Group will equal
the related Senior Percentage.
Senior Principal Distribution Amount: As to any Distribution
Date and
Senior Certificate Group, the sum of (i) the related Senior
Percentage of the
Net Principal Payment Amount with respect to the related Loan
Group for such
Distribution Date, (ii) the related Senior Prepayment Percentage
of the Net
Principal Prepayment Amount with respect to the related Loan
Group for such
Distribution Date and (iii) any Transfer Payments Received for
that Loan Group
and Distribution Date; provided, however that on any
Distribution Date after a
Senior Termination Date, the Senior Principal Distribution
Amount for the
remaining Senior Certificate Group will be calculated pursuant
to the above
formula based upon all of the Mortgage Loans, as opposed to the
Mortgage Loans
in the related Loan Group.
Senior Step Down Conditions: As of the first Distribution Date
as to
which any decrease in the Senior Prepayment Percentage applies,
(i) the
outstanding principal balance of all Mortgage Loans 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 (a) if such date
is on or
prior to a Senior Termination Date, the Subordinated Percentage
for such Loan
Group of the aggregate Stated Principal Balance of the Mortgage
Loans in that
Loan Group, or (b) if such date is after a Senior Termination
Date, the
aggregate Class Certificate Balance of the Subordinated
Certificates for such
Distribution Date, does not equal or exceed 50%, and (ii)
cumulative Realized
Losses on all of the Mortgage Loans in that Loan Group 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 with 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
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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, a division of The McGraw-Hill
Companies, Inc. If
S&P is designated as a Rating Agency in the Preliminary
Statement, for
purposes of Section 10.05(b) the address for notices to S&P
shall be Standard
& Poor's, 55 Water Street, New York, New York 10041,
Attention: Mortgage
Surveillance Monitoring, or such other address as S&P may
hereafter furnish to
the Depositor and the Master Servicer.
Startup Day: The Closing Date.
Stated Principal Balance: As to any Mortgage Loan and date, the
unpaid
principal balance of such Mortgage Loan as of the Due Date
immediately
preceding such 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 the sum of: (i) any previous partial Principal
Prepayments and the
payment of principal due on such Due Date, irrespective of any
delinquency in
payment by the related Mortgagor, (ii) Liquidation Proceeds
allocable to
principal (other than with respect to any Liquidated Mortgage
Loan) received
in the prior calendar month and Principal Prepayments received
through the
last day of the related Prepayment Period, in each case, with
respect to that
Mortgage Loan and (iii) any Deferred Interest added to the
principal balance
of that Mortgage Loan pursuant to the terms of the related
Mortgage Note on or
prior to that Due Date.
Streamlined Documentation Mortgage Loan: Any Mortgage Loan
originated
pursuant to the Countrywide's Streamlined Loan Documentation
Program then in
effect. For the purposes of this Agreement, a Mortgagor is
eligible for a
mortgage pursuant to Countrywide's Streamlined Loan
Documentation Program if
that Mortgagor is refinancing an existing mortgage loan that was
originated or
acquired by Countrywide where, among other things, the mortgage
loan has not
been more than 30 days delinquent in payment during the previous
twelve month
period.
Subordinate Weighted Average Rate: For each Interest Accrual
Period
related to each Distribution Date, a per annum rate equal to (1)
the sum of
the following for each Loan Group:
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<PAGE>
the product of (x) the Weighted Average Adjusted Net Mortgage
Rate of the
Mortgage Loans in that Loan Group and (y) the related
Subordinated Portion
immediately prior to that Distribution Date, divided by (2) the
aggregate
Class Certificate Balance of the Subordinated Certificates
immediately prior
to that Distribution Date, adjusted for the related Interest
Accrual Period.
Subordinated Adjusted Cap Rate: For any Distribution Date, the
weighted
average of the Group 1 Adjusted Cap Rate and the Group 2
Adjusted Cap Rate, in
each case for that Distribution Date, weighted on the basis of
the
Subordinated Portion of the Mortgage Loans in the related Loan
Group.
Subordinated Certificates: As specified in the Preliminary
Statement.
Subordinated Percentage: As to any Distribution Date on or prior
to a
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 a Senior Termination
Date, 100% minus
the Senior Percentage for such Distribution Date.
Subordinated Portion: For any Distribution Date and any Loan
Group, an
amount equal to the aggregate Stated Principal Balance of the
Mortgage Loans
in that Loan Group as of the end of the Prepayment Period
related to the
immediately preceding Distribution Date, minus the sum of the
aggregate Class
Certificate Balance of the related Classes of 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 related
Subordinated Percentage
of the Net Principal Payment Amount for that Loan Group and that
Distribution
Date and (ii) the related Subordinated Prepayment Percentage for
that Loan
Group of the Net Principal Prepayment Amount for that Loan Group
and that
Distribution Date over (B) any Transfer Payments Made for such
Loan Group;
provided, however, that on any Distribution Date after a Senior
Termination
Date, the Subordinated Principal Distribution Amount will not be
calculated by
Loan Group but will equal the amount calculated pursuant to the
formula set
forth above based on the related 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
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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 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 and Mortgage Index reset period 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; (ix) have the same Maximum
Negative
Amortization, payment cap and recast provisions as the Deleted
Mortgage Loan;
and (x) comply with each representation and warranty set forth
in Section
2.03.
Substitution Adjustment Amount: The meaning ascribed to such
term
pursuant to Section 2.03.
Successful Auction: An auction held pursuant to Section 9.04
hereof at
which at least three Qualified Bidders submitted bids and at
least the Minimum
Bid Price was bid as the purchase price for the Mortgage Loans
and any related
REO Properties by a Qualified Bidder.
Targeted Balance: With respect to any group of Targeted
Principal
Classes or Components in the aggregate and any Distribution Date
appearing in
Schedule V hereto, the Aggregate Targeted Balance for such group
and
Distribution Date. With respect to any other Targeted Principal
Class or
Component and any Distribution Date appearing in Schedule V
hereto, the
applicable amount appearing opposite such Distribution Date for
such Class or
Component.
Targeted Principal Classes: As specified in the Preliminary
Statement.
Tax Matters Person: The person designated as "tax matters
person" in
the manner provided under Treasury regulation ss. 1.860F-4(d)
and temporary
Treasury regulation ss. 301.6231(a)(7)1T. Initially, the Tax
Matters Person
shall be the Trustee.
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: Either or both of a Transfer Payment Made or
a
Transfer Payment Received.
Transfer Payment Made: As defined in Section 4.05.
Transfer Payment Received: As defined in Section 4.05.
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<PAGE>
Trust Fund: The corpus of the trust created under this
Agreement
consisting of (i) the Mortgage Loans and all interest and
principal received
on or with respect thereto after the Cut-off Date to the extent
not applied in
computing the Cut-off Date Principal Balance of the Mortgage
Loans; (ii) the
Certificate Account, the Distribution Account and the Carryover
Shortfall
Reserve Fund, and all amounts deposited therein pursuant to the
applicable
provisions of this Agreement; (iii) property that secured a
Mortgage Loan and
has been acquired by foreclosure, deed-in-lieu of foreclosure or
otherwise;
(iv) the Corridor Contract; and (v) 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%.
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 (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) the cumulative Realized Losses on all of the
Mortgage Loans do
not exceed (x) with respect to any Distribution Date on or
before January
2008, 20% of the aggregate Class Certificate Balance of the
Subordinated
Certificates on the Closing Date or (y) with respect to any
Distribution Date
after January 2008, 30% of the aggregate Class Certificate
Balance of the
Subordinated Certificates on the Closing Date.
Undercollateralized Group: As defined in Section 4.05.
Underwriters: As specified in the Preliminary Statement.
Underwriter's Exemption: Prohibited Transaction Exemption
2002-41, 67
Fed. Reg. 54487 (2002), as amended (or any successor thereto),
or any
substantially similar administrative exemption granted by the
U.S. Department
of Labor.
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
Class X 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 Class X Certificates)
shall be allocated
among Holders of the remaining Classes of Certificates in
proportion to the
Certificate Balances of their respective Certificates on such
date.
Weighted Average Adjusted Net Mortgage Rate: As to any
Distribution Date
and 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
as of the end of the Prepayment Period related to the
immediately preceding
Distribution Date.
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<PAGE>
Winning Bidder: With respect to a Successful Auction, the
Qualified
Bidder offering to pay the highest price (but in no event less
than the
Minimum Bid Price) for the assets of the Trust Fund.
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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 and Park Granada 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. In
addition, on the
Closing Date, the Depositor shall cause $100.00 to be deposited
into the Class
C Distribution Account.
(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. In addition, the Depositor hereby directs
the Trustee to
execute and deliver the Confirmation.
(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 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
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(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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(E) The executed UCC-1 financing statement with evidence of
recording thereon which have been filed in all places required
to
perfect the applicable Seller's interest in the Coop Shares
and
the Proprietary Lease; and
(F) The executed UCC-3 financing statements or other
appropriate UCC financing statements required by state law,
evidencing a complete and unbroken line from the mortgagee to
the
Trustee with evidence of recording thereon (or in a form
suitable
for recordation).
In addition, in connection with the assignment of any MERS
Mortgage
Loan, each Seller agrees that it will cause, at the Trustee's
expense, the
MERS(R) System to indicate that the Mortgage Loans sold by such
Seller to the
Depositor have been assigned by that Seller to the Trustee in
accordance with
this Agreement for the benefit of the Certificateholders by
including (or
deleting, in the case of Mortgage Loans which are repurchased in
accordance
with this Agreement) in such computer files the information
required by the
MERS(R) System to identify the series of the Certificates issued
in connection
with such Mortgage Loans. Each Seller further agrees that it
will not, and
will not permit the Master Servicer to, and the Master Servicer
agrees that it
will not, alter the information referenced in this paragraph
with respect to
any Mortgage Loan sold by such Seller to the Depositor during
the term of this
Agreement unless and until such Mortgage Loan is repurchased in
accordance
with the terms of this Agreement.
In the event that in connection with any Mortgage Loan that is
not a
MERS Mortgage Loan the Depositor cannot deliver (a) the original
recorded
Mortgage, (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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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 2005-2, 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)
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) 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) shall
have five (5) Business Days to cure such failure to deliver. At
the end of
such thirty (30)-day period the Trustee shall send a Delay
Delivery
Certification for the Delay Delivery Mortgage Loans delivered
during such
thirty (30)-day period in accordance with the provisions of
Section 2.02.
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<PAGE>
(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 (48) and (49) 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) 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) 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) 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) shall promptly
correct or cure
such defect within 90 days from the date it was so notified of
such defect
and, if Countrywide does not correct or cure such defect within
such period,
Countrywide (on its own behalf and on behalf of Park Granada)
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
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<PAGE>
Countrywide (on its own behalf and on behalf of Park Granada)
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 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) 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 shall
execute and deliver at Countrywide's (on its own behalf and on
behalf of Park
Granada) 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),
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) 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) 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) or its
designee as the
beneficial holder of such Mortgage Loan.
(b) [Reserved].
(c) [Reserved].
(d) The Trustee shall retain possession and custody of each
Mortgage
File in accordance with and subject to the terms and conditions
set forth in
this Agreement. The Master Servicer shall promptly deliver to
the Trustee,
upon the execution or receipt thereof, the originals of such
other documents
or instruments constituting the Mortgage File as come into the
possession of
the Master Servicer from time to time.
(e) It is understood and agreed that the respective obligations
of each
Seller to substitute for or to purchase any Mortgage Loan sold
to the
Depositor by it which does not meet the
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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.
(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 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
40
<PAGE>
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) 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), in each case without recourse, as shall be necessary
to vest title
in that Seller, or its designee, the Trustee's interest in any
Deleted
Mortgage Loan substituted for pursuant to this Section 2.03.
For any month in which a Seller substitutes one or more
Substitute
Mortgage Loans for one or more Deleted Mortgage Loans, the
Master Servicer
will determine the amount (if any) by which the aggregate
principal balance of
all Substitute Mortgage Loans sold to the Depositor by that
Seller as of the
date of substitution is less than the aggregate Stated Principal
Balance of
all Deleted Mortgage Loans repurchased by that Seller (after
application of
the scheduled principal portion of the monthly payments due in
the month of
substitution). The amount of such shortage (the "Substitution
Adjustment
Amount") plus an amount equal to the aggregate of any
unreimbursed Advances
with respect to such Deleted Mortgage Loans shall be deposited
in the
Certificate Account by Countrywide (on its own behalf and on
behalf of Park
Granada) 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
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during which that Seller became obligated hereunder to
repurchase or replace
such Mortgage Loan and upon such deposit of the Purchase Price,
the delivery
of the Opinion of Counsel required by Section 2.05 and receipt
of a Request
for Release in the form of Exhibit N hereto, the Trustee shall
release the
related Mortgage File held for the benefit of the
Certificateholders to such
Person, and the Trustee shall execute and deliver at such
Person's direction
such instruments of transfer or assignment prepared by such
Person, in each
case without recourse, as shall be necessary to transfer title
from the
Trustee. It is understood and agreed that the obligation under
this Agreement
of any Person to cure, repurchase or replace any Mortgage Loan
as to which a
breach has occurred and is continuing shall constitute the sole
remedy against
such Persons respecting such breach available to
Certificateholders, the
Depositor or the Trustee on their behalf.
The representations and warranties made pursuant to this Section
2.03
shall survive delivery of the respective Mortgage Files to the
Trustee for the
benefit of the Certificateholders.
SECTION 2.04 Representations and Warranties of the Depositor as
to the
Mortgage Loans.
The Depositor hereby represents and warrants to the Trustee with
respect
to each Mortgage Loan as of the date of this Agreement or such
other date set
forth in this Agreement that as of the Closing Date, and
following the
transfer of the Mortgage Loans to it by each Seller, the
Depositor had good
title to the Mortgage Loans and the Mortgage Notes were subject
to no offsets,
defenses or counterclaims.
The Depositor hereby assigns, transfers and conveys to the
Trustee all
of its rights with respect to the Mortgage Loans including,
without
limitation, the representations and warranties of each Seller
made pursuant to
Section 2.03(a), together with all rights of the Depositor to
require a Seller
to cure any breach thereof or to repurchase or substitute for
any affected
Mortgage Loan in accordance with this Agreement.
It is understood and agreed that the representations and
warranties set
forth in this Section 2.04 shall survive delivery of the
Mortgage Files to the
Trustee. Upon discovery by the Depositor or the Trustee of a
breach of any of
the foregoing representations and warranties set forth in this
Section 2.04
(referred to herein as a "breach"), which breach materially and
adversely
affects the interest of the Certificateholders, the party
discovering such
breach shall give prompt written notice to the others and to
each Rating
Agency.
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.
42
<PAGE>
(b) Upon discovery by the Depositor, a Seller, the Master
Servicer, or
the Trustee that any Mortgage Loan does not constitute a
"qualified mortgage"
within the meaning of Section 860G(a)(3) of the Code, the party
discovering
such fact shall promptly (and in any event within five (5)
Business Days of
discovery) give written notice thereof to the other parties. In
connection
therewith, the Trustee shall require Countrywide (on its own
behalf and on
behalf of Park Granada) 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.
SECTION 2.08 Covenants of the Master Servicer.
The Master Servicer hereby covenants to the Depositor and the
Trustee as
follows:
(a) the Master Servicer shall comply in the performance of
its
obligations under this Agreement with all reasonable rules and
requirements of
the insurer under each Required Insurance Policy; and
(b) no written information, certificate of an officer,
statement
furnished in writing or written report delivered to the
Depositor, any
affiliate of the Depositor or the Trustee and prepared by the
Master Servicer
pursuant to this Agreement will contain any untrue statement of
a material
fact or omit to state a material fact necessary to make such
information,
certificate, statement or report not misleading.
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ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
SECTION 3.01 Master Servicer to Service Mortgage Loans.
For and on behalf of the Certificateholders, the Master Servicer
shall
service and administer the Mortgage Loans in accordance with the
terms of this
Agreement and customary and usual standards of practice of
prudent mortgage
loan servicers. In connection with such servicing and
administration, the
Master Servicer shall have full power and authority, acting
alone and/or
through Subservicers as provided in Section 3.02, subject to the
terms of this
Agreement (i) to execute and deliver, on behalf of the
Certificateholders and
the Trustee, customary consents or waivers and other instruments
and
documents, (ii) to consent to transfers of any Mortgaged
Property and
assumptions of the Mortgage Notes and related Mortgages (but
only in the
manner provided in this Agreement), (iii) to collect any
Insurance Proceeds
and other Liquidation Proceeds (which for the purpose of this
Section 3.01
includes any Subsequent Recoveries), and (iv) to effectuate
foreclosure or
other conversion of the ownership of the Mortgaged Property
securing any
Mortgage Loan; provided that the Master Servicer shall not take
any action
that is inconsistent with or prejudices the interests of the
Trust Fund or the
Certificateholders in any Mortgage Loan or the rights and
interests of the
Depositor, the Trustee and the Certificateholders under this
Agreement. The
Master Servicer shall represent and protect the interests of the
Trust Fund in
the same manner as it protects its own interests in mortgage
loans in its own
portfolio in any claim, proceeding or litigation regarding a
Mortgage Loan,
and shall not make or permit any modification, waiver or
amendment of any
Mortgage Loan which would cause any REMIC created under this
Agreement to fail
to qualify as a REMIC or result in the imposition of any tax
under Section
860F(a) or Section 860G(d) of the Code. Without limiting the
generality of the
foregoing, the Master Servicer, in its own name or in the name
of the
Depositor and the Trustee, is hereby authorized and empowered by
the Depositor
and the Trustee, when the Master Servicer believes it
appropriate in its
reasonable judgment, to execute and deliver, on behalf of the
Trustee, the
Depositor, the Certificateholders or any of them, any and all
instruments of
satisfaction or cancellation, or of partial or full release or
discharge and
all other comparable instruments, with respect to the Mortgage
Loans, and with
respect to the Mortgaged Properties held for the benefit of
the
Certificateholders. The Master Servicer shall prepare and
deliver to the
Depositor and/or the Trustee such documents requiring execution
and delivery
by either or both of them as are necessary or appropriate to
enable the Master
Servicer to service and administer the Mortgage Loans to the
extent that the
Master Servicer is not permitted to execute and deliver such
documents
pursuant to the preceding sentence. Upon receipt of such
documents, the
Depositor and/or the Trustee shall execute such documents and
deliver them to
the Master Servicer. The Master Servicer further is authorized
and empowered
by the Trustee, on behalf of the Certificateholders and the
Trustee, in its
own name or in the name of the Subservicer, when the Master
Servicer or the
Subservicer, as the case may be, believes it appropriate in its
best judgment
to register any Mortgage Loan on the MERS(R) System, or cause
the removal from
the registration of any Mortgage Loan on the MERS(R) System, to
execute and
deliver, on behalf of the Trustee and the Certificateholders or
any of them,
any and all instruments of assignment and other comparable
instruments with
respect to such assignment or re-recording of a Mortgage in the
name of MERS,
solely as nominee for the Trustee and its successors and
assigns.
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In accordance with the standards of the preceding paragraph, the
Master
Servicer shall advance or cause to be advanced funds as
necessary for the
purpose of effecting the payment of taxes and assessments on the
Mortgaged
Properties, which advances shall be reimbursable in the first
instance from
related collections from the Mortgagors pursuant to Section
3.06, and further
as provided in Section 3.08. The costs incurred by the Master
Servicer, if
any, in effecting the timely payments of taxes and assessments
on the
Mortgaged Properties and related insurance premiums shall not,
for the purpose
of calculating monthly distributions to the Certificateholders,
be added to
the Stated Principal Balances of the related Mortgage Loans,
notwithstanding
that the terms of such Mortgage Loans so permit.
SECTION 3.02 Subservicing; Enforcement of the Obligations of
Servicers.
(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 under this Agreement and may, but is not
obligated to,
perform, or cause a designee to perform, any defaulted
obligation of the
Master Servicer under this Agreement and in connection with any
such defaulted
obligation to exercise the related rights of the Master Servicer
under this
Agreement; provided that the Master Servicer shall not be
relieved of any of
its obligations under this Agreement by virtue of such
performance by the
Depositor or its designee. Neither the Trustee nor the Depositor
shall have
any responsibility or liability for any action or failure to act
by the Master
Servicer nor shall the Trustee or the Depositor be obligated to
supervise the
performance of the Master Servicer under this Agreement or
otherwise.
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SECTION 3.04 Trustee to Act as Master Servicer.
In the event that the Master Servicer shall for any reason no
longer be
the Master Servicer under this Agreement (including by reason of
an Event of
Default), the Trustee or its successor shall then assume all of
the rights and
obligations of the Master Servicer under this Agreement arising
thereafter
(except that the Trustee shall not be (i) liable for losses of
the Master
Servicer pursuant to Section 3.09 or any acts or omissions of
the predecessor
Master Servicer under this Agreement), (ii) obligated to make
Advances if it
is prohibited from doing so by applicable law, (iii) obligated
to effectuate
repurchases or substitutions of Mortgage Loans under this
Agreement including,
but not limited to, repurchases or substitutions of Mortgage
Loans pursuant to
Section 2.02 or 2.03, (iv) responsible for expenses of the
Master Servicer
pursuant to Section 2.03 or (v) deemed to have made any
representations and
warranties of the Master Servicer under this Agreement). Any
such assumption
shall be subject to Section 7.02. If the Master Servicer shall
for any reason
no longer be the Master Servicer (including by reason of any
Event of
Default), the Trustee or its successor shall succeed to any
rights and
obligations of the Master Servicer under each subservicing
agreement.
The Master Servicer shall, upon request of the Trustee, but at
the
expense of the Master Servicer, deliver to the assuming party
all documents
and records relating to each subservicing agreement or
substitute subservicing
agreement and the Mortgage Loans then being serviced thereunder
and an
accounting of amounts collected or held by it and otherwise use
its best
efforts to effect the orderly and efficient transfer of the
substitute
subservicing agreement to the assuming party.
SECTION 3.05 Collection of Mortgage Loan Payments;
Certificate
Account; Distribution Account; Carryover Shortfall
Reserve Fund.
(a) The Master Servicer shall make reasonable efforts in
accordance with
the customary and usual standards of practice of prudent
mortgage servicers to
collect all payments called for under the terms and provisions
of the Mortgage
Loans to the extent such procedures shall be consistent with
this Agreement
and the terms and provisions of any related Required Insurance
Policy.
Consistent with the foregoing, the Master Servicer may in its
discretion (i)
waive any late payment charge or any prepayment charge or
penalty interest in
connection with the prepayment of a Mortgage Loan and (ii)
extend the due
dates for payments due on a Mortgage Note for a period not
greater than 180
days; provided, however, that the Master Servicer cannot extend
the maturity
of any such Mortgage Loan past the date on which the final
payment is due on
the latest maturing Mortgage Loan as of the Cut-off Date. In the
event of any
such arrangement, the Master Servicer shall make Advances on the
related
Mortgage Loan in accordance with the provisions of Section 4.01
during the
scheduled period in accordance with the amortization schedule of
such Mortgage
Loan without modification thereof by reason of such
arrangements. The Master
Servicer shall not be required to institute or join in
litigation with respect
to collection of any payment (whether under a Mortgage, Mortgage
Note or
otherwise or against any public or governmental authority with
respect to a
taking or condemnation) if it reasonably believes that enforcing
the provision
of the Mortgage or other instrument pursuant to which such
payment is required
is prohibited by applicable law.
(b) The Master Servicer shall establish and maintain a
Certificate
Account into which the Master Servicer shall deposit or cause to
be deposited
no later than two Business Days after
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receipt (or, if the current long-term credit rating of
Countrywide is reduced
below "A-" by S&P or "A3" by Moody's, the Master Servicer
shall deposit or
cause to be deposited on a daily basis within one Business Day
of receipt),
except as otherwise specifically provided in this Agreement, the
following
payments and collections remitted by Subservicers or received by
it in respect
of Mortgage Loans subsequent to the Cut-off Date (other than in
respect of
principal and interest due on the Mortgage Loans on or before
the Cut-off
Date) and the following amounts required to be deposited under
this Agreement:
(i) all payments on account of principal on the Mortgage
Loans,
including Principal Prepayments;
(ii) all payments on account of interest on the Mortgage
Loans,
net of the related Master Servicing Fee and any lender paid
mortgage
insurance premiums;
(iii) all Insurance Proceeds, Subsequent Recoveries and
Liquidation Proceeds, other than proceeds to be applied to
the
restoration or repair of a Mortgaged Property or released to
the
Mortgagor in accordance with the Master Servicer's normal
servicing
procedures;
(iv) any amount required to be deposited by the Master Servicer
or
the Depositor pursuant to Section 3.05(e) in connection with any
losses
on Permitted Investments for which it is responsible;
(v) any amounts required to be deposited by the Master
Servicer
pursuant to Section 3.09(c) and in respect of net monthly rental
income
from REO Property pursuant to Section 3.11;
(vi) all Substitution Adjustment Amounts;
(vii) all Advances made by the Master Servicer pursuant to
Section
4.01; 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
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
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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
therein as directed
in writing by the Master Servicer, in the case of the
Certificate Account, or
by the Trustee, in the case of the Distribution Account, 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 Master
Servicer Remittance 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
Master Servicer Remittance 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 shall be for the benefit of the
Master Servicer as
servicing compensation and shall be remitted to it monthly as
provided in this
Agreement. All income and gain net of any losses realized from
any such
investment of funds on deposit in the Distribution Account shall
be
distributed in accordance with the following paragraph for the
benefit of the
Trustee, as compensation for its
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duties hereunder, or the Master Servicer, as servicing
compensation, and the
respective portions to which each shall be entitled shall be
remitted to them
monthly as provided in this Agreement. The amount of any
realized losses in
the Certificate Account incurred in any such account in respect
of any such
investments shall promptly be deposited by the Master Servicer
in the
Certificate Account. The Trustee in its fiduciary capacity shall
not be liable
for the amount of any loss incurred in respect of any investment
or lack of
investment of funds held in the Certificate Account and made in
accordance
with this Section 3.05.
With respect to each Distribution Date, (1) all income and gain
net of
the Trustee's portion of any losses realized from any such
investment of funds
on deposit in the Distribution Account during the six (6)
calendar days
immediately following the related Master Servicer Remittance
Date and (2) the
excess of (x) all investment income and gain net of the Master
Servicer's
portion of any losses realized from any such investment of funds
on deposit in
the Distribution Account over (y) the amount paid to the Trustee
pursuant to
clause (1) of this sentence shall be for the benefit of the
Master Servicer as
compensation and such amounts shall be remitted to the Trustee
and Master
Servicer, respectively, monthly as provided herein. In the event
that there
are any realized losses from the investment of funds on deposit
in the
Distribution Account, the proportion of such realized loss
payable by the
Trustee and the Master Servicer shall be allocated pursuant to
the following
formula: (i) with respect to the Trustee, the product of (x) the
amount of the
realized loss and (y) a fraction, the numerator of which is 6
and the
denominator of which is the actual number of days from the
Master Servicer
Remittance Date to and including the Distribution Date and (ii)
with respect
to the Master Servicer, the product of (x) the amount of the
realized loss and
(y) a fraction, not less than zero, the numerator of which is
the excess, if
any, of (a) the actual number of days from the Master Servicer
Remittance Date
to and including the Distribution Date minus (b) 6, and the
denominator of
which is the actual number of days from the Master Servicer
Remittance Date to
and including the Distribution Date. Each of the Trustee and the
Master
Servicer shall promptly deposit in the Distribution Account
their respective
portion of any realized loss calculated pursuant to the
preceding sentence.
(f) The Master Servicer shall give notice to the Trustee, each
Seller,
each Rating Agency and the Depositor of any proposed change of
the location of
the Certificate Account prior to any change thereof. The Trustee
shall give
notice to the Master Servicer, each Seller, each Rating Agency
and the
Depositor of any proposed change of the location of the
Distribution Account
or the Carryover Shortfall Reserve Fund prior to any change
thereof.
(g) On the Closing Date, the Trustee shall establish and
maintain in its
name, in trust for the benefit of the Holders of the LIBOR
Certificates, the
Carryover Shortfall Reserve Fund and shall deposit $5,000
therein upon receipt
from or on behalf of the Depositor of such amount. All funds on
deposit in the
Carryover Shortfall Reserve Fund shall (x) be held separate and
apart from,
and shall not be commingled with, any other moneys, including
without
limitation, other moneys held by the Trustee pursuant to this
Agreement, and
(y) remain uninvested.
On each Distribution Date, the Trustee shall deposit all
amounts
distributable to each Class of Class X Certificates on such
Distribution Date
into the Carryover Shortfall Reserve Fund together with any
amounts received
pursuant to the Corridor Contract. The Trustee shall make
withdrawals from the
Carryover Shortfall Reserve Fund to make distributions pursuant
to
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Section 4.02(a)(5) exclusively (other than as expressly provided
for in
Section 3.08). Amounts on deposit in the Carryover Shortfall
Reserve Fund
shall remain uninvested.
(h) The Trustee shall establish and maintain the Class C
Distribution
Account and shall administer it in accordance with this
Agreement. On the
Closing Date, the Trustee shall deposit $100 into the Class C
Distribution
Account. The institution at which the Class C Distribution
Account is
maintained shall hold such funds on deposit uninvested.
All funds deposited in the Class C Distribution Account shall be
held by
the Trustee in trust for the Holder of the Class C Certificates
until
disbursed in accordance with Section 9.04(d) hereof.
SECTION 3.06 Collection of Taxes, Assessments and Similar
Items;
Escrow Accounts.
(a) To the extent required by the related Mortgage Note and
not
violative of current law, the Master Servicer shall establish
and maintain one
or more accounts (each, an "Escrow Account") and deposit and
retain therein
all collections from the Mortgagors (or advances by the Master
Servicer) for
the payment of taxes, assessments, hazard insurance premiums or
comparable
items for the account of the Mortgagors. Nothing in this
Agreement shall
require the Master Servicer to compel a Mortgagor to establish
an Escrow
Account in violation of applicable law.
(b) Withdrawals of amounts so collected from the Escrow Accounts
may be
made only to effect timely payment of taxes, assessments, hazard
insurance
premiums, condominium or PUD association dues, or comparable
items, to
reimburse the Master Servicer out of related collections for any
payments made
pursuant to Sections 3.01 (with respect to taxes and assessments
and insurance
premiums) and 3.09 (with respect to hazard insurance), to refund
to any
Mortgagors any sums determined to be overages, to pay interest,
if required by
law or the terms of the related Mortgage or Mortgage Note, to
Mortgagors on
balances in the Escrow Account or to clear and terminate the
Escrow Account at
the termination of this Agreement in accordance with Section
9.01. The Escrow
Accounts shall not be a part of the Trust Fund.
(c) The Master Servicer shall advance any payments referred to
in
Section 3.06(a) that are not timely paid by the Mortgagors on
the date when
the tax, premium or other cost for which such payment is
intended is due, but
the Master Servicer shall be required so to advance only to the
extent that
such advances, in the good faith judgment of the Master
Servicer, will be
recoverable by the Master Servicer out of Insurance Proceeds,
Liquidation
Proceeds or otherwise.
SECTION 3.07 Access to Certain Documentation and Information
Regarding
the Mortgage Loans.
The Master Servicer shall afford each Seller, the Depositor 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.
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Upon reasonable advance notice in writing, the Master Servicer
will
provide to each Certificateholder and/or Certificate Owner which
is a savings
and loan association, bank or insurance company certain reports
and reasonable
access to information and documentation regarding the Mortgage
Loans
sufficient to permit such Certificateholder and/or Certificate
Owner to comply
with applicable regulations of the OTS or other regulatory
authorities with
respect to investment in the Certificates; provided that the
Master Servicer
shall be entitled to be reimbursed by each such
Certificateholder and/or
Certificate Owner for actual expenses incurred by the Master
Servicer in
providing such reports and access.
SECTION 3.08 Permitted Withdrawals from the Certificate Account;
the
Distribution Account and the Carryover Shortfall Reserve
Fund.
(a) The Master Servicer may from time to time make withdrawals
from the
Certificate Account for the following purposes:
(i) to pay to the Master Servicer (to the extent not
previously
retained by the Master Servicer) the servicing compensation to
which it
is entitled pursuant to Section 3.14 and to pay to the Master
Servicer,
as additional servicing compensation, earnings on or investment
income
with respect to funds in or credited to the Certificate
Account;
(ii) to reimburse each of the Master Servicer and the Trustee
for
unreimbursed Advances made by it, such right of reimbursement
pursuant
to this subclause (ii) being limited to amounts received on the
Mortgage
Loan(s) in respect of which any such Advance was made;
(iii) to reimburse each of the Master Servicer and the Trustee
for
any Nonrecoverable Advance previously made by it;
(iv) to reimburse the Master Servicer for Insured Expenses
from
the related Insurance Proceeds;
(v) to reimburse the Master Servicer for (a) unreimbursed
Servicing Advances, the Master Servicer's right to
reimbursement
pursuant to this clause (a) with respect to any Mortgage Loan
being
limited to amounts received on such Mortgage Loan(s) that
represent late
recoveries of the payments for which such advances were made
pursuant to
Section 3.01 or Section 3.06 and (b) for unpaid Master Servicing
Fees as
provided in Section 3.11;
(vi) to pay to the purchaser, with respect to each Mortgage
Loan
or property acquired in respect thereof that has been purchased
pursuant
to Section 2.02, 2.03 or 3.11, all amounts received on such
Mortgage
Loan after the date of such purchase;
(vii) to reimburse the Sellers, the Master Servicer or the
Depositor for expenses incurred by any of them and reimbursable
pursuant
to Section 6.03;
(viii) to withdraw any amount deposited in the Certificate
Account
and not required to be deposited in the Certificate Account;
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(ix) on or prior to the Master Servicer Remittance Date, to
withdraw an amount equal to the related Available Funds 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) with respect to each Distribution Date, to pay to itself
as
compensation for its services hereunder any investment income
earned on
amounts on deposit in the Distribution Account during the six
(6)
calendar days immediately following the related Master
Servicer
Remittance Date;
(ii) with respect to each Distribution Date, to pay to the
Master
Servicer as additional servicing compensation the excess, if
any, of the
investment income earned on amounts on deposit in the
Distribution
Account over the amount paid to the Trustee pursuant to clause
(i)
above;
(iii) to withdraw and return to the Master Servicer any
amount
deposited in the Distribution Account and not required to be
deposited
therein;
(iv) to reimburse the Trustee for any unreimbursed Advances
made
by it pursuant to Section 4.01(b) hereof, such right of
reimbursement
pursuant to this subclause (iv) being limited to (x) amounts
received on
the related Mortgage Loan(s) in respect of which any such
Advance was
made and (y) amounts not otherwise reimbursed to the Trustee
pursuant to
Section 3.08(a)(ii) hereof;
(v) to reimburse the Trustee for any Nonrecoverable Advance
previously made by the Trustee pursuant to Section 4.01(b)
hereof, such
right of reimbursement pursuant to this subclause (v) being
limited to
amounts not otherwise reimbursed to the Trustee pursuant to
Section
3.08(a)(iii) hereof; and
(vi) to clear and terminate the Distribution Account upon
termination of the Agreement pursuant to Section 9.01.
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<PAGE>
(c) The Trustee shall withdraw funds from the Carryover
Shortfall
Reserve Fund for distribution to the LIBOR Certificates and the
Components of
the Class 1-X, Class 2-X and Class M-X Certificates in the
manner specified in
Section 4.02(a)(5) (and to withhold from the amounts so
withdrawn the amount
of any taxes that it is authorized to retain pursuant to the
last paragraph of
Section 8.11). In addition, the Trustee may from time to time
make withdrawals
from the Carryover Shortfall Reserve Fund for the following
purposes:
(i) to withdraw any amount deposited in the Carryover
Shortfall
Reserve Fund and not required to be deposited therein; and
(ii) to clear and terminate the Carryover Shortfall Reserve
Fund
upon the retirement of LIBOR Certificates and the Class 1-X,
Class 2-X
and Class M-X Certificates 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, including any Deferred
Interest, 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) [Reserved]
53
<PAGE>
(c) The Master Servicer shall not take any action which would
result in
non-coverage under any applicable Primary Insurance Policy of
any loss which,
but for the actions of the Master Servicer, would have been
covered
thereunder. The Master Servicer shall not cancel or refuse to
renew any such
Primary Insurance Policy that is in effect at the date of the
initial issuance
of the Certificates and is required to be kept in force
hereunder unless the
replacement Primary Insurance Policy for such canceled or
non-renewed policy
is maintained with a Qualified Insurer.
Except with respect to any Lender PMI Mortgage Loans, the
Master
Servicer shall not be required to maintain any Primary Insurance
Policy (i)
with respect to any Mortgage Loan with a Loan-to-Value Ratio
less than or
equal to 80% as of any date of determination or, based on a new
appraisal, the
principal balance of such Mortgage Loan represents 80% or less
of the new
appraised value or (ii) if maintaining such Primary Insurance
Policy is
prohibited by applicable law. With respect to the Lender PMI
Mortgage Loans,
the Master Servicer shall maintain the Primary Insurance Policy
for the life
of such Mortgage Loans, unless otherwise provided for in the
related Mortgage
Note or prohibited by law.
The Master Servicer agrees to effect the timely payment of the
premiums
on each Primary Insurance Policy, and such costs not otherwise
recoverable
shall be recoverable by the Master Servicer from the related
liquidation
proceeds and Subsequent Recoveries.
(d) In connection with its activities as Master Servicer of the
Mortgage
Loans, the Master Servicer agrees to present on behalf of
itself, the Trustee
and Certificateholders, claims to the insurer under any Primary
Insurance
Policies and, in this regard, to take such reasonable action as
shall be
necessary to permit recovery under any Primary Insurance
Policies respecting
defaulted Mortgage Loans. Any amounts collected by the Master
Servicer under
any Primary Insurance Policies shall be deposited in the
Certificate Account.
SECTION 3.10 Enforcement of Due-on-Sale Clauses; Assumption
Agreements.
(a) Except as otherwise provided in this Section, when any
property
subject to a Mortgage has been conveyed by the Mortgagor, the
Master Servicer
shall to the extent that it has knowledge of such conveyance,
enforce any
due-on-sale clause contained in any Mortgage Note or Mortgage,
to the extent
permitted under applicable law and governmental regulations, but
only to the
extent that such enforcement will not adversely affect or
jeopardize coverage
under any Required Insurance Policy. Notwithstanding the
foregoing, the Master
Servicer is not required to exercise such rights with respect to
a Mortgage
Loan if the Person to whom the related Mortgaged Property has
been conveyed or
is proposed to be conveyed satisfies the terms and conditions
contained in the
Mortgage Note and Mort
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