<PAGE>
EXHIBIT 4.1
EXECUTION COPY
MERRILL LYNCH MORTGAGE INVESTORS, INC.
Depositor
WELLS FARGO BANK, N.A.
Trustee
and
WILSHIRE CREDIT CORPORATION,
Servicer
--------------------------------------
POOLING AND SERVICING AGREEMENT
Dated as of March 1, 2005
--------------------------------------
MERRILL LYNCH MORTGAGE INVESTORS TRUST,
MORTGAGE LOAN ASSET-BACKED CERTIFICATES, SERIES 2005-HE1
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TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS...................................................................
1
ARTICLE II CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES................. 46
SECTION 2.01.
Conveyance of Mortgage Loans..................................
46
Section 2.02.
Acceptance by the Trustee of the Mortgage Loans...............
50
Section 2.03.
Representations, Warranties and Covenants of the Depositor ...
51
Section 2.04.
Representations and Warranties of the Servicer................
55
Section 2.05.
Substitutions and Repurchases of Mortgage Loans which are
not "Qualified Mortgages." ...................................
56
Section 2.06.
Authentication and Delivery of Certificates...................
57
Section 2.07. REMIC
Elections............................................... 57
Section 2.08.
[RESERVED]....................................................
61
Section 2.09.
Covenants of the Servicer.....................................
61
Section 2.10.
[RESERVED]....................................................
61
Section 2.11.
Permitted Activities of the Trust.............................
61
Section 2.12.
Qualifying Special Purpose Entity.............................
61
ARTICLE III ADMINISTRATION AND SERVICING OF
MORTGAGE LOANS............................... 61
Section 3.01. Servicer
to Service Mortgage Loans............................ 61
Section 3.02.
Servicing and Subservicing; Enforcement of the Obligations
of Servicer ..................................................
63
Section 3.03. Rights
of the Depositor and the Trustee in Respect of the
Servicer .....................................................
64
Section 3.04. Trustee
to Act as Servicer.................................... 64
Section 3.05.
Collection of Mortgage Loan Payments; Collection Account;
Certificate Account ..........................................
65
Section 3.06.
Collection of Taxes, Assessments and Similar Items; Escrow
Accounts .....................................................
68
Section 3.07. Access
to Certain Documentation and Information
Regarding the Mortgage Loans .................................
69
Section 3.08.
Permitted Withdrawals from the Collection Account and
Certificate Account ..........................................
69
Section 3.09.
[RESERVED]....................................................
71
Section 3.10.
Maintenance of Hazard Insurance...............................
71
Section 3.11.
Enforcement of Due-On-Sale Clauses; Assumption Agreements ....
72
Section 3.12.
Realization Upon Defaulted Mortgage Loans; Determination
of Excess Proceeds ...........................................
73
Section 3.13. Trustee
to Cooperate; Release of Mortgage Files............... 76
Section 3.14.
Documents, Records and Funds in Possession of Servicer to
be Held for the Trustee ......................................
77
Section 3.15.
Servicing Compensation........................................
78
Section 3.16. Access
to Certain Documentation............................... 78
Section 3.17. Annual
Statement as to Compliance............................. 78
Section 3.18. Annual
Independent Public Accountants' Servicing
Statement; Financial Statements ..............................
79
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Section 3.19. Rights
of the NIMs Insurer.................................... 79
Section 3.20. Periodic
Filings.............................................. 79
Section 3.21. Annual
Certificate by Trustee................................. 80
Section 3.22. Annual
Certificate by Servicer................................ 80
Section 3.23.
Prepayment Charge Reporting Requirements......................
81
Section 3.24.
Statements to Trustee.........................................
81
Section 3.25.
Indemnification...............................................
82
Section 3.26.
Nonsolicitation...............................................
82
Section 3.27. MI
Policies; Claims Under the MI Policies..................... 82
Section 3.28. High
Cost Mortgage Loans...................................... 83
ARTICLE IV
DISTRIBUTIONS................................................................
83
SECTION 4.01.
Advances......................................................
83
Section 4.02.
Reduction of Servicing Compensation in Connection with
Prepayment Interest Shortfalls ...............................
84
Section 4.03.
Distributions on the REMIC Interests..........................
84
Section
4.04.
Distributions.................................................
85
Section 4.05. Monthly
Statements to Certificateholders...................... 90
ARTICLE V THE
CERTIFICATES.............................................................
94
Section 5.01. The
Certificates.............................................. 94
Section 5.02.
Certificate Register; Registration of Transfer and Exchange
of Certificates ..............................................
94
Section 5.03.
Mutilated, Destroyed, Lost or Stolen Certificates.............
98
Section 5.04. Persons
Deemed Owners......................................... 98
Section 5.05. Access
to List of Certificateholders' Names and Addresses .... 99
Section 5.06.
Book-Entry Certificates.......................................
99
Section 5.07. Notices
to Depository........................................ 100
Section 5.08.
Definitive Certificates......................................
100
Section 5.09.
Maintenance of Office or Agency..............................
100
ARTICLE VI THE DEPOSITOR AND THE
SERVICER.............................................. 101
Section 6.01.
Respective Liabilities of the Depositor and the Servicer ....
101
Section 6.02. Merger
or Consolidation of the Depositor or the Servicer .... 101
Section 6.03.
Limitation on Liability of the Depositor, the Servicer and
Others ......................................................
101
Section 6.04.
Limitation on Resignation of Servicer........................
102
Section 6.05. Errors
and Omissions Insurance; Fidelity Bonds............... 102
ARTICLE VII DEFAULT; TERMINATION OF
SERVICER............................................ 102
Section 7.01. Events
of Default............................................ 102
Section 7.02. Trustee
to Act; Appointment of Successor..................... 104
Section 7.03.
Notification to Certificateholders...........................
104
ARTICLE VIII...........CONCERNING THE
TRUSTEE and the securities administrator ......... 105
Section 8.01. Duties
of the Trustee........................................ 105
Section 8.02. Certain
Matters Affecting the Trustee........................ 106
Section 8.03. Trustee
Not Liable for Mortgage Loans........................ 107
Section 8.04. Trustee
May Own Certificates................................. 107
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Section 8.05.
Trustee's Fees and Expenses..................................
107
Section 8.06.
Indemnification of Trustee...................................
108
Section 8.07.
Eligibility Requirements for Trustee.........................
109
Section 8.08.
Resignation and Removal of Trustee...........................
109
Section 8.09.
Successor Trustee............................................
110
Section 8.10. Merger
or Consolidation of Trustee........................... 110
Section 8.11.
Appointment of Co-Trustee or Separate Trustee................
110
Section 8.12. Tax
Matters.................................................. 111
ARTICLE IX
TERMINATION.................................................................
114
Section 9.01.
Termination upon Liquidation or Repurchase of all
Mortgage Loans
.............................................. 114
Section 9.02. Final
Distribution on the Certificates....................... 115
Section 9.03.
Additional Termination Requirements..........................
116
ARTICLE X MISCELLANEOUS
PROVISIONS....................................................
117
Section 10.01.
Amendment....................................................
117
Section 10.02.
Counterparts.................................................
119
Section 10.03. Governing
Law................................................ 119
Section 10.04. Intention of
Parties......................................... 119
SECTION 10.05.
Notices......................................................
119
Section 10.06. Severability of
Provisions................................... 120
Section 10.07.
Assignment...................................................
120
Section 10.08. Limitation on Rights of
Certificateholders................... 121
Section 10.09. Inspection and Audit
Rights.................................. 122
Section 10.10. Certificates Nonassessable and Fully
Paid.................... 122
Section 10.11. Third Party
Rights........................................... 123
Section 10.12. Additional Rights of the NIMs
Insurer........................ 123
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TABLE OF CONTENTS
(continued)
EXHIBIT A
FORMS OF CERTIFICATES
EXHIBIT B-1
MORTGAGE LOAN SCHEDULE - MORTGAGE POOL
EXHIBIT B-2
MORTGAGE LOAN SCHEDULE - GROUP ONE MORTGAGE LOANS
EXHIBIT B-3
MORTGAGE LOAN SCHEDULE - GROUP TWO MORTGAGE LOANS
EXHIBIT B-4
MORTGAGE LOAN SCHEDULE - MI MORTGAGE LOANS
EXHIBIT C
[RESERVED]
EXHIBIT D
FORM OF TRUSTEE CERTIFICATION
EXHIBIT E-1 FORM
OF TRANSFEREE'S LETTER AND AFFIDAVIT
EXHIBIT E-2 FORM
OF TRANSFEROR'S AFFIDAVIT
EXHIBIT F
FORM OF TRANSFEROR CERTIFICATE
EXHIBIT G
FORM OF INVESTMENT LETTER (ACCREDITED INVESTOR)
EXHIBIT H
FORM OF RULE 144A LETTER (QUALIFIED INSTITUTIONAL BUYER)
EXHIBIT I
FORM OF REQUEST FOR RELEASE
EXHIBIT J
LIST OF TRANSFER AGREEMENTS AND BRING DOWN LETTERS
EXHIBIT K
FORM OF OFFICER'S CERTIFICATE OF TRUSTEE
EXHIBIT L
FORM OF OFFICER'S CERTIFICATE OF SERVICER
EXHIBIT M
MORTGAGE LOAN MODIFICATIONS
EXHIBIT N-1 FORM
OF CLASS A-1 CAP CONTRACT
EXHIBIT N-2 FORM
OF CLASS A-2 CAP CONTRACT
EXHIBIT N-3 FORM
OF SUBORDINATED CERTIFICATE CAP CONTRACT
EXHIBIT O-1
ONE-MONTH LIBOR CAP TABLE - CLASS A-1 CAP CONTRACT
EXHIBIT O-2 ONE
MONTH LIBOR CAP TABLE - CLASS A-2 CAP CONTRACT
EXHIBIT O-3 ONE
MONTH LIBOR CAP TABLE - SUBORDINATED CERTIFICATE CAP
CONTRACT
EXHIBIT P
[RESERVED]
EXHIBIT Q-1. MI POLICY-
PMI MORTGAGE INSURANCE CO.
EXHIBIT Q-2. MI POLICY-
MORTGAGE GUARANTY INSURANCE CORPORATION
iv
<PAGE>
POOLING
AND SERVICING AGREEMENT (the "Agreement"), dated as of March 1,
2005, among MERRILL LYNCH MORTGAGE
INVESTORS, INC., a Delaware corporation, as
depositor (the "Depositor"), WELLS FARGO
BANK, N.A, a national banking
association, as trustee (the "Trustee") and
WILSHIRE CREDIT CORPORATION, a
Nevada corporation, as servicer (the
"Servicer").
The
Depositor is the owner of the Trust Fund that is hereby conveyed
to
the Trustee in return for the Certificates.
The Trust Fund for federal income
tax purposes will consist of (i) two real
estate mortgage investment conduits,
(ii) the right to receive payments
distributable to the Class P Certificates
pursuant to Section 4.04(b)(i) hereof,
(iii) each Cap Contract and the Cap
Contract Account and (iv) the grantor
trusts described in Section 2.07 hereof.
The Lower Tier REMIC will consist of all of
the assets constituting the Trust
Fund (other than the assets described in
clauses (ii), (iii) and (iv) above and
the Lower Tier REMIC Regular Interests) and
will be evidenced by the Lower Tier
REMIC Regular Interests (which will be
uncertificated and will represent the
"regular interests" in the Lower Tier
REMIC) and the Class LTR Interest as the
single "residual interest" in the Lower
Tier REMIC. The Trustee will hold the
Lower Tier REMIC Regular Interests. The
Upper Tier REMIC will consist of the
Lower Tier REMIC Regular Interests and will
be evidenced by the REMIC Regular
Interests (which will represent the
"regular interests" in the Upper Tier REMIC)
and the Residual Interest as the single
"residual interest" in the Upper Tier
REMIC. The Class R Certificate will
represent beneficial ownership of the Class
LTR Interest and the Residual Interest. The
"latest possible maturity date" for
federal income tax purposes of all
interests created hereby will be the Latest
Possible Maturity Date.
All
covenants and agreements made by the Transferors in the
Transfer
Agreements, by the Seller in the Sale
Agreement and by the Depositor and the
Trustee herein with respect to the Mortgage
Loans and the other property
constituting the Trust Fund are for the
benefit of the Holders from time to time
of the Certificates and, to the extent
provided herein, the NIMs Insurer.
In
consideration of the mutual agreements herein contained, the
Depositor,
the Servicer and the Trustee hereby agree
as follows:
ARTICLE I
DEFINITIONS
Whenever
used in this Agreement, the following words and phrases, unless
the context otherwise requires, shall have
the following meanings:
Accepted
Servicing Practices: The Servicer's normal servicing practices,
which will conform to the mortgage
servicing practices of prudent mortgage
lending institutions that service for their
own account mortgage loans of the
same type as the Mortgages Loans in the
jurisdictions in which the related
Mortgaged Properties (or Underlying
Mortgaged Properties in the case of Co-op
Loans) are located.
Accrual
Period: With respect to each Class of Certificates and the
Lower
Tier REMIC Interests and any Distribution
Date, the period commencing on the
immediately preceding Distribution Date
(or, in the case of the first
Distribution Date, the Closing Date) and
ending on the day immediately preceding
such Distribution Date. All calculations of
interest on each Class of
Certificates and the Lower Tier REMIC
Interests will be made on the basis of the
actual number of days elapsed in the
related Accrual Period and a 360 day year.
Adjustable
Rate Mortgage Loan: A Mortgage Loan identified in the Mortgage
Loan Schedule as having a Mortgage Rate
which is adjustable.
<PAGE>
Adjustment
Date: As to each Adjustable Rate Mortgage Loan, each date on
which the related Mortgage Rate is subject
to adjustment, as provided in the
related Mortgage Note.
Advance:
The aggregate of the advances required to be made by the
Servicer
with respect to any Distribution Date
pursuant to Section 4.01, the amount of
any such advances being equal to the sum of
the aggregate amount of all payments
of principal and interest (net of the
Servicing Fee) on the Mortgage Loans that
were due during the applicable Due Period
and not received as of the close of
business on the related Determination Date
(other than the principal portion of
any Balloon Amount), less the aggregate
amount of any such Delinquent payments
that the Servicer has determined would
constitute a Non-Recoverable Advance were
an advance to be made with respect thereto;
provided, however, that with respect
to any Mortgage Loan which is not a first
lien Mortgage Loan that is 150 days
delinquent or more (whether or not the
Mortgage Loan has been converted to an
REO Property), there will be no obligation
to make advances and, provided
further, however, that with respect to any
Mortgage Loan that has been converted
to an REO Property which is less than 150
days delinquent, the obligation to
make Advances shall only be to payments of
interest.
Advance
Facility: A financing or other facility as described in Section
10.07.
Advancing
Person: The Person to whom the Servicer's rights under this
Agreement to be reimbursed for any Advances
or Servicing Advances have been
assigned pursuant to Section 10.07.
Affiliate:
With respect to any specified Person, any other Person
controlling, controlled by or under common
control with such Person. For the
purposes of this definition, "control"
means the power to direct the management
and policies of a Person, directly or
indirectly, whether through ownership of
voting securities, by contract or
otherwise; and the terms "controlling" and
"controlled" have meanings correlative to
the foregoing.
Aggregate
Certificate Principal Balance: For any date of determination,
the sum of the Class A-1A Certificate
Principal Balance, the Class A-1B
Certificate Principal Balance, the Class
A-2A Certificate Principal Balance, the
Class A-2B Certificate Principal Balance,
the Class A-2C Certificate Principal
Balance, the Class R Certificate Principal
Balance, the Class M-1 Certificate
Principal Balance, the Class M-2
Certificate Principal Balance, the Class M-3
Certificate Principal Balance, the Class
B-1 Certificate Principal Balance, the
Class B-2 Certificate Principal Balance,
the Class B-3 Certificate Principal
Balance, the Class B-4 Certificate
Principal Balance and the Class B-5
Certificate Principal Balance, in each case
as of such date of determination.
Agreement:
This Pooling and Servicing Agreement and any and all amendments
or supplements hereto made in accordance
with the terms herein.
Applied
Realized Loss Amount: With respect to any Distribution Date,
the
amount, if any, by which, the sum of (i)
the Aggregate Certificate Principal
Balance and (ii) the Class C Certificate
Principal Balance after distributions
of principal on such Distribution Date
exceeds the aggregate Stated Principal
Balance of the Mortgage Loans as of such
Distribution Date.
Appraised
Value: With respect to a Mortgage Loan the proceeds of which
were used to purchase the related Mortgaged
Property (or the related residential
dwelling unit in the Underlying Mortgaged
Property in the case of a Co-op Loan),
the "Appraised Value" of a Mortgaged
Property (or the related residential
dwelling unit in the Underlying Mortgaged
Property in the case of a Co-op Loan)
is the lesser of (1) the appraised value
based on an appraisal made for the
Seller by an independent fee appraiser at
the time of the origination of the
related Mortgage Loan, and (2) the sales
price of such Mortgaged Property (or
the related residential dwelling unit in
the Underlying Mortgaged Property in
the case of a Co-op
- 2 -
<PAGE>
Loan) at such time of origination. With
respect to a Mortgage Loan the proceeds
of which were used to refinance an existing
mortgage loan, the "Appraised Value"
is the appraised value of the Mortgaged
Property (or the related residential
dwelling unit in the Underlying Mortgaged
Property in the case of a Co-op Loan)
based upon the appraisal obtained at the
time of refinancing.
Assignment
of Mortgage: An assignment of the Mortgage, notice of transfer
(or UCC-3 assignment (or equivalent
instrument) with respect to each Co-op Loan)
or equivalent instrument, in recordable
form (except in the case of a Co-op
Loan) (except for the name of the assignee
if such Mortgage Loan is endorsed in
blank), sufficient under the laws of the
jurisdiction where the related
Mortgaged Property (or Underlying Mortgaged
Property, in the case of a Co-op
Loan) is located to reflect of record the
sale and assignment of the Mortgage
Loan to the Trustee, which assignment,
notice of transfer or equivalent
instrument may, if permitted by law, be in
the form of one or more blanket
assignments covering Mortgages secured by
Mortgaged Properties located in the
same county.
Auction:
The one-time auction conducted by the Trustee, as described in
Section 9.01(b) hereof.
Auction
Date: The date on which the Auction occurs.
Available
Funds Cap: Any of the Class A-1 Available Funds Cap, the Class
A-2 Available Funds Cap or the Subordinated
Certificate Available Funds Cap.
Balloon
Loan: A Mortgage Loan having an original term to stated
maturity
of approximately 15 years which provides
for level monthly payments of principal
and interest based on a 30-year
amortization schedule, with a balloon payment of
the remaining outstanding principal balance
due on such Mortgage Loan at its
stated maturity.
Book-Entry
Certificates: Any of the Certificates that shall be registered
in the name of the Depository or its
nominee, the ownership of which is
reflected on the books of the Depository or
on the books of a Person maintaining
an account with the Depository (directly,
as a "Depository Participant," or
indirectly, as an indirect participant in
accordance with the rules of the
Depository and as described in Section
5.06). As of the Closing Date, each of
the Class A (other than the Class R
Certificate), Class M and Class B
Certificates constitutes a Class of
Book-Entry Certificates.
Bring Down
Letters: Those certain letter agreements, dated as of April 21,
2005 between the Seller and each Transferor
set out on Exhibit J hereto.
Business
Day: Any day other than (1) a Saturday or a Sunday, or (2) a
day
on which banking institutions in the State
of California, State of Maryland,
State of Minnesota, State of Oregon and in
the City of New York, New York are
authorized or obligated by law or executive
order to be closed.
Cap
Contract: Any of the Class A-1 Cap Contract, the Class A-2 Cap
Contract or the Subordinated Certificate
Cap Contract.
Cap
Contract Account: The separate Eligible Account created and
maintained
by the Trustee pursuant to Section
4.04(k)(i) in the name of the Trustee for the
benefit of the Trust Fund and designated
"Wells Fargo Bank, N.A., as Trustee, as
trustee, in trust for registered holders of
Merrill Lynch Mortgage Investors
Trust, Mortgage Loan Asset-Backed
Certificates, Series 2005-HE1." Funds in the
Cap Contract Account shall be held in trust
for the Trust Fund for the uses and
purposes set forth in this Agreement.
Cap
Contract Counterparty: The Bank of New York.
- 3 -
<PAGE>
Cap
Contract Notional Balance: Any of the Class A-1 Cap Contract
Notional
Balance, the Class A-2 Cap Contract
Notional Balance or the Subordinated
Certificate Cap Contract Notional
Balance.
Cap
Contract Termination Date: Any of the Class A-1 Cap Contract
Termination Date, the Class A-2 Cap
Contract Termination Date or the
Subordinated Certificate Cap Contract
Termination Date.
Certificate: Any one of the certificates of any Class executed by
the
Trustee and authenticated by the Trustee in
substantially the forms attached
hereto as Exhibits A.
Certificate Account: The separate Eligible Account created and
maintained
by the Trustee pursuant to Section 3.05(e)
in the name of the Trustee for the
benefit of the Certificateholders and
designated "Wells Fargo Bank, N.A., as
trustee, in trust for registered holders of
Merrill Lynch Mortgage Investors
Trust, Mortgage Loan Asset-Backed
Certificates, Series 2005-HE1." Funds in the
Certificate Account shall be held in trust
for the Certificateholders for the
uses and purposes set forth in this
Agreement.
Certificate Group: Either of Certificate Group One or Certificate
Group
Two.
Certificate Group One: The Class A-1A, Class A-1B and Class R
Certificates. For purposes of Section 2.07
hereof, Certificate Group One shall
be related to Group One.
Certificate Group Two: The Class A-2A, Class A-2B and Class
A-2C
Certificates. For purposes of Section 2.07
hereof, Certificate Group Two shall
be related to Group Two.
Certificate Owner: With respect to a Book-Entry Certificate, the
Person
that is the beneficial owner of such
Book-Entry Certificate.
Certificate Principal Balance: As to any Certificate and as of
any
Distribution Date, the Initial Certificate
Principal Balance of such Certificate
less the sum of (1) all amounts distributed
with respect to such Certificate in
reduction of the Certificate Principal
Balance thereof on previous Distribution
Dates pursuant to Section 4.04, and (2) any
Applied Realized Loss Amounts
allocated to such Certificate on previous
Distribution Dates pursuant to Section
4.04(i). On each Distribution Date, after
all distributions of principal on such
Distribution Date, a portion of the Class C
Interest Carry Forward Amount in an
amount equal to the excess of the
Overcollateralization Amount on such
Distribution Date over the
Overcollateralization Amount as of the preceding
Distribution Date (or, in the case of the
first Distribution Date, the initial
Overcollateralization Amount (based on the
Stated Principal Balance of the
Mortgage Loans as of the Cut-off Date))
will be added to the aggregate
Certificate Principal Balance of the Class
C Certificates (on a pro rata basis).
Notwithstanding the foregoing on any
Distribution Date relating to a Due Period
in which a Subsequent Recovery has been
received by the Servicer, the
Certificate Principal Balance of any Class
of Certificates then outstanding for
which any Applied Realized Loss Amount has
been allocated will be increased, in
order of seniority, by an amount equal to
the lesser of (i) the Unpaid Realized
Loss Amount for such Class of Certificates
and (ii) the total of any Subsequent
Recovery distributed on such date to the
Certificateholders (reduced by the
amount of the increase in the Certificate
Principal Balance of any more senior
Class of Certificates pursuant to this
sentence on such Distribution Date).
Certificate Register: The register maintained pursuant to Section
5.02
hereof.
Certificateholder or Holder: The Person in whose name a Certificate
is
registered in the Certificate Register
(initially, Cede & Co., as nominee for
the Depository) in the case of any Class of
Regular Certificates or the Class R
Certificate, except that solely for the
purpose of giving any consent
- 4 -
<PAGE>
pursuant to this Agreement, any Certificate
registered in the name of the
Depositor or any Affiliate of the Depositor
shall be deemed not to be
Outstanding and the Percentage Interest
evidenced thereby shall not be taken
into account in determining whether the
requisite amount of Percentage Interests
necessary to effect such consent has been
obtained; provided, however, that if
any such Person (including the Depositor)
owns 100% of the Percentage Interests
evidenced by a Class of Certificates, such
Certificates shall be deemed to be
Outstanding for purposes of any provision
hereof that requires the consent of
the Holders of Certificates of a particular
Class as a condition to the taking
of any action hereunder. The NIMs Insurer
and the Trustee are 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
Section 5.01 hereof.
Class A
Certificate Principal Balance: For any date of determination,
the
sum of the Class A-1A Certificate Principal
Balance, the Class A-1B Certificate
Principal Balance, the Class A-2A
Certificate Principal Balance, the Class A-2B
Certificate Principal Balance, the Class
A-2C Certificate Principal Balance and
the Class R Certificate Principal
Balance.
Class A
Certificates: Any of the Class A-1 Certificates, the Class A-2
Certificates and the Class R
Certificates.
Class A
Principal Distribution Amount: With respect to any Distribution
Date (1) prior to the Stepdown Date or any
Distribution Date on which a Stepdown
Trigger Event exists, 100% of the Principal
Distribution Amount for such
Distribution Date and (2) on or after the
Stepdown Date where a Stepdown Trigger
Event does not exist, the excess of (A) the
Class A Certificate Principal
Balance immediately prior to such
Distribution Date over (B) the lesser of (i)
73.90% of the Stated Principal Balance of
the Mortgage Loans as of the end of
the immediately preceding Due Period and
(ii) the excess of the Stated Principal
Balance of the Mortgage Loans as of the end
of the immediately preceding Due
Period over the Minimum Required
Overcollateralization Amount; provided,
however, that in no event will the Class A
Principal Distribution Amount with
respect to any Distribution Date exceed the
aggregate Certificate Principal
Balance of the Class A Certificates.
Class A-1
Available Funds Cap: With respect to a Distribution Date, the
per annum rate equal to the product of (i)
12, (ii) the quotient of (x) the
total scheduled interest on the Mortgage
Loans in Group One based on the Net
Mortgage Rates in effect on the related Due
Date divided by (y) the aggregate
Stated Principal Balance of the Mortgage
Loans in Group One as of the first day
of the related Accrual Period (or, in the
case of the first Distribution Date,
as of the Cut-off Date) and (iii) a
fraction, the numerator of which is 30, and
the denominator of which is the actual
number of days in the related Accrual
Period.
Class A-1
Cap Contract: The amended confirmation and agreement and any
related confirmation thereto, between the
Trust Fund or Trustee and the Cap
Contract Counterparty (in the form of
Exhibit N-1 hereto).
Class A-1
Cap Contract Notional Balance: With respect to any Distribution
Date, the Class A-1 Cap Contract Notional
Balance set forth for such
Distribution Date in the Class A-1
One-Month LIBOR Cap Table attached hereto as
Exhibit O-1.
Class A-1
Cap Contract Termination Date: The day after the Distribution
Date in April 2008.
Class A-1
Certificates: Any of the Class A-1A and Class A-1B
Certificates.
- 5
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<PAGE>
Class A-1
Maximum Rate Cap: With respect to a Distribution Date, the per
annum rate, adjusted to reflect the length
of the related Accrual Period, equal
to the weighted average of the maximum
lifetime Net Mortgage Rates on the
Adjustable Rate Mortgage Loans in Group One
and the Net Mortgage Rates on the
Fixed Rate Mortgage Loans in Group One. The
Class A-1 Maximum Rate Cap shall
relate to the Class A-1 and Class R
Certificates.
Class A-1
Required Loss Percentage: For any Distribution Date, the
applicable percentage for such Distribution
Date set forth in the following
table:
Distribution Date Occurring In Class A-1
Required Loss Percentage
April 2005
- March 2008
1.50%
April 2008
- March 2009
1.50% with respect to April 2008, plus an
additional 1/12th of 0.50% for each month
thereafter
April 2009
- March 2010
2.00% with respect to April 2009, plus an
additional 1/12th of 0.75% for each month
thereafter
April 2010
- March 2011
2.75% with respect to April 2010, plus an
additional 1/12th of 0.25% for each month
thereafter
April 2011
and thereafter 3.00%
Class A-1
Trigger Event: The situation that exists with respect to any
Distribution Date on or after April 2005,
if (a) the quotient of (1) the
aggregate Stated Principal Balance of all
Group One Mortgage Loans 60 or more
days delinquent, measured on a rolling
three-month basis (including Mortgage
Loans in foreclosure, REO Properties and
Mortgage Loans with respect to which
the applicable mortgagor is in bankruptcy)
and (2) the Stated Principal Balance
of all the Group One Mortgage Loans as of
the preceding Servicer Remittance
Date, equals or exceeds the product of (i)
40.00% and (ii) the Required
Percentage or (b) the quotient (expressed
as a percentage) of (1) the aggregate
Realized Losses incurred from the Cut-off
Date through the last day of the
calendar month preceding such Distribution
Date and (2) the aggregate principal
balance of the Group One Mortgage Loans as
of the Cut-off Date exceeds the Class
A-1 Required Loss Percentage
Class A-1
Upper Collar: With respect to each Distribution Date with
respect to which payments are received on
the Class A-1 Cap Contract, a rate
equal to the lesser of One-Month LIBOR and
9.280% per annum.
Class A-1A Certificate: Any
Certificate designated as a "Class A-1A
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class A-1A
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance
of the Class A-1A Certificates.
Class A-1A
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period
at the Class A-1A Pass-Through Rate on
the Class A-1A Certificate Principal
Balance as of such Distribution Date plus
the portion of any previous distributions
on such Class in respect of Current
Interest or a Class A-1A Interest Carry
Forward Amount that is recovered as a
voidable preference by a trustee in
bankruptcy, less any Non-Supported Interest
Shortfall allocated on such Distribution
Date to the Class A-1A Certificates.
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<PAGE>
Class A-1A
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class A-1A
Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
A-1A Certificates with respect to interest
on such prior Distribution Dates and
(2) interest on such excess (to the extent
permitted by applicable law) at the
Class A-1A Pass-Through Rate for the
related Accrual Period.
Class A-1A
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date, 0.210%
per annum and, as of any Distribution
Date after the Optional Termination Date,
0.420% per annum.
Class A-1A
Pass-Through Rate: For the first Distribution Date, 3.210% per
annum. As of any Distribution Date
thereafter, the least of (1) One-Month LIBOR
plus the Class A-1A Margin and (2) the
Class A-1 Available Funds Cap for such
Distribution Date.
Class A-1B
Certificate: Any Certificate designated as a "Class A-1B
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class A-1B
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance
of the Class A-1B Certificates.
Class A-1B
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period
at the Class A-1B Pass-Through Rate on
the Class A-1B Certificate Principal
Balance as of such Distribution Date plus
the portion of any previous distributions
on such Class in respect of Current
Interest or a Class A-1B Interest Carry
Forward Amount that is recovered as a
voidable preference by a trustee in
bankruptcy, less any Non-Supported Interest
Shortfall allocated on such Distribution
Date to the Class A-1B Certificates.
Class A-1B
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class A-1B
Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
A-1B Certificates with respect to interest
on such prior Distribution Dates and
(2) interest on such excess (to the extent
permitted by applicable law) at the
Class A-1B Pass-Through Rate for the
related Accrual Period.
Class A-1B
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date for the
Certificates, 0.260% per annum and, as
of any Distribution Date after the Optional
Termination Date, 0.520% per annum.
Class A-1B
Pass-Through Rate: For the first Distribution Date, 3.260% per
annum. As of any Distribution Date
thereafter, the least of (1) One-Month LIBOR
plus the Class A-1B Margin and (2) the
Class A-1 Available Funds Cap for such
Distribution Date.
Class A-2
Available Funds Cap: With respect to a Distribution Date, the
per annum rate equal to the product of (i)
12, (ii) the quotient of (x) the
total scheduled interest on the Mortgage
Loans in Group Two based on the Net
Mortgage Rates in effect on the related Due
Date divided by (y) the aggregate
Stated Principal Balance of the Mortgage
Loans in Group Two as of the first day
of the related Accrual Period (or, in the
case of the first Distribution Date,
as of the Cut-off Date) and (iii) a
fraction, the numerator of which is 30, and
the denominator of which is the actual
number of days in the related Accrual
Period.
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<PAGE>
Class A-2
Cap Contract: The amended confirmation and agreement and any
related confirmation thereto, between the
Trust Fund or Trustee and the Cap
Contract Counterparty (in the form of
Exhibit N-2 hereto).
Class A-2
Cap Contract Notional Balance: With respect to any Distribution
Date, the Class A-2 Cap Contract Notional
Balance set forth for such
Distribution Date in the Class A-2
One-Month LIBOR Cap Table attached hereto as
Exhibit O-2.
Class A-2
Cap Contract Termination Date: The day after the Distribution
Date in May 2011.
Class A-2
Certificates: Any of the Class A-2A, Class A-2B and Class A-2C
Certificates.
Class A-2
Maximum Rate Cap: With respect to a Distribution Date, the per
annum rate, adjusted to reflect the length
of the related Accrual Period, equal
to the weighted average of the maximum
lifetime Net Mortgage Rates on the
Adjustable Rate Mortgage Loans in Group Two
and the Net Mortgage Rates on the
Fixed Rate Mortgage Loans in Group Two. The
Class A-2 Maximum Rate Cap shall
relate to the Class A-2 Certificates.
Class A-2
Upper Collar: With respect to each Distribution Date with
respect to which payments are received on
the Class A-2 Cap Contract, a rate
equal to the lesser of One-Month LIBOR and
9.300% per annum.
Class A-2A
Certificate: Any Certificate designated as a "Class A-2A
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class A-2A
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance
of the Class A-2A Certificates.
Class A-2A
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period
at the Class A-2A Pass-Through Rate on
the Class A-2A Certificate Principal
Balance as of such Distribution Date plus
the portion of any previous distributions
on such Class in respect of Current
Interest or a Class A-2A Interest Carry
Forward Amount that is recovered as a
voidable preference by a trustee in
bankruptcy, less any Non-Supported Interest
Shortfall allocated on such Distribution
Date to the Class A-2A Certificates.
Class A-2A
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class A-2A
Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
A-2A Certificates with respect to interest
on such prior Distribution Dates and
(2) interest on such excess (to the extent
permitted by applicable law) at the
Class A-2A Pass-Through Rate for the
related Accrual Period.
Class A-2A
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date for the
Certificates, 0.100% per annum and, as
of any Distribution Date after the Initial
Optional Termination Date, 0.200% per
annum.
Class A-2A
Pass-Through Rate: For the first Distribution Date, 3.100% per
annum. As of any Distribution Date
thereafter, the least of (1) One-Month LIBOR
plus the Class A-2A Margin and (2) the
Class A-2 Available Funds Cap for such
Distribution Date.
Class A-2B
Certificate: Any Certificate designated as a "Class A-2B
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
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<PAGE>
Class A-2B
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance
of the Class A-2B Certificates.
Class A-2B
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period
at the Class A-2B Pass-Through Rate on
the Class A-2B Certificate Principal
Balance as of such Distribution Date plus
the portion of any previous distributions
on such Class in respect of Current
Interest or a Class A-2B Interest Carry
Forward Amount that is recovered as a
voidable preference by a trustee in
bankruptcy, less any Non-Supported Interest
Shortfall allocated on such Distribution
Date to the Class A-2B Certificates.
Class A-2B
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class A-2B
Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
A-2B Certificates with respect to interest
on such prior Distribution Dates and
(2) interest on such excess (to the extent
permitted by applicable law) at the
Class A-2B Pass-Through Rate for the
related Accrual Period.
Class A-2B
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date for the
Certificates, 0.200% per annum and, as
of any Distribution Date after the Initial
Optional Termination Date, 0.400% per
annum.
Class A-2B
Pass-Through Rate: For the first Distribution Date, 3.200% per
annum. As of any Distribution Date
thereafter, the least of (1) One-Month LIBOR
plus the Class A-2B Margin and (2) the
Class A-2 Available Funds Cap for such
Distribution Date.
Class A-2C
Certificate: Any Certificate designated as a "Class A-2C
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class A-2C
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance
of the Class A-2C Certificates.
Class A-2C
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period
at the Class A-2C Pass-Through Rate on
the Class A-2C Certificate Principal
Balance as of such Distribution Date plus
the portion of any previous distributions
on such Class in respect of Class A-2C
Current Interest or a Class A-2C Interest
Carry Forward Amount that is recovered
as a voidable preference by a trustee in
bankruptcy, less any Non-Supported
Interest Shortfall allocated on such
Distribution Date to the Class A-2C
Certificates.
Class A-2C
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class A-2C
Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
A-2C Certificates with respect to interest
on such prior Distribution Dates and
(2) interest on such excess (to the extent
permitted by applicable law) at the
Class A-2C Pass-Through Rate for the
related Accrual Period.
Class A-2C
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date for the
Certificates, 0.310% per annum and, as
of any Distribution Date after the Initial
Optional Termination Date, 0.620% per
annum.
Class A-2C
Pass-Through Rate: For the first Distribution Date, 3.310% per
annum. As of any Distribution Date
thereafter, the least of (1) One-Month LIBOR
plus the Class A-2C Margin and (2) the
Class A-2 Available Funds Cap for such
Distribution Date.
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<PAGE>
Class B
Certificates: Any of the Class B-1, Class B-2, Class B-3, Class
B-4 or Class B-5 Certificates.
Class B-1
Applied Realized Loss Amount: As of any Distribution Date, the
sum of all Applied Realized Loss Amounts
with respect to the Mortgage Loans
which have been applied to the reduction of
the Certificate Principal Balance of
the Class B-1 Certificates.
Class B-1
Certificate: Any Certificate designated as a "Class B-1
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class B-1
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance
of the Class B-1 Certificates.
Class B-1
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period
at the Class B-1 Pass-Through Rate on
the Class B-1 Certificate Principal Balance
as of such Distribution Date plus
the portion of any previous distributions
on such Class in respect of Current
Interest or a Class B-1 Interest Carry
Forward Amount that is recovered as a
voidable preference by a trustee in
bankruptcy, less any Non-Supported Interest
Shortfall allocated on such Distribution
Date to the Class B-1 Certificates.
Class B-1
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class B-1
Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
B-1 Certificates with respect to interest
on such prior Distribution Dates and
(2) interest on such excess (to the extent
permitted by applicable law) at the
Class B-1 Pass-Through Rate for the related
Accrual Period.
Class B-1
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date for the
Certificates, 1.200% per annum and, as
of any Distribution Date after the Initial
Optional Termination Date, 1.800% per
annum.
Class B-1
Pass-Through Rate: For the first Distribution Date, 4.200% per
annum. As of any Distribution Date
thereafter, the least of (1) One-Month LIBOR
plus the Class B-1 Margin and (2) the
Subordinated Certificate Available Funds
Cap for such Distribution Date.
Class B-1
Principal Distribution Amount: With respect to any Distribution
Date on or after the Stepdown Date, 100% of
the Principal Distribution Amount
for such Distribution Date if the Class A
Certificate Principal Balance and the
Class M Certificate Principal Balance have
been reduced to zero and a Stepdown
Trigger Event exists, or as long as a
Stepdown Trigger Event does not exist, the
excess of (1) the sum of (A) the Class A
Certificate Principal Balance (after
taking into account distributions of the
Class A Principal Distribution Amount
on such Distribution Date), (B) the Class
M-1 Certificate Principal Balance
(after taking into account distributions of
the Class M-1 Principal Distribution
Amount on such Distribution Date), (C) the
Class M-2 Certificate Principal
Balance (after taking into account
distributions of the Class M-2 Principal
Distribution Amount on such Distribution
Date), (D) the Class M-3 Certificate
Principal Balance (after taking into
account distributions of the Class M-3
Principal Distribution Amount on such
Distribution Date) and (E) the Class B-1
Certificate Principal Balance immediately
prior to such Distribution Date over
(2) the lesser of (A) 94.50% of the Stated
Principal Balance of the Mortgage
Loans as of the end of the immediately
preceding Due Period and (B) the excess
of the Stated Principal Balance of the
Mortgage Loans as of the end of the
immediately preceding Due Period over the
Minimum Required Overcollateralization
Amount. Notwithstanding the foregoing, (I)
on any Distribution Date prior to the
Stepdown Date on which the Certificate
Principal Balance of each Class of Class
A Certificates and Class M Certificates has
been reduced to zero, the Class B-1
Principal Distribution
- 10 -
<PAGE>
Amount will equal the lesser of (x) the
outstanding Certificate Principal
Balance of the Class B-1 Certificates and
(y) 100% of the Principal Distribution
Amount remaining after any distributions on
such Class A Certificates and Class
M Certificates and (II) in no event will
the Class B-1 Principal Distribution
Amount with respect to any Distribution
Date exceed the Class B-1 Certificate
Principal Balance.
Class B-1
Unpaid Realized Loss Amount: As of any Distribution Date, the
excess of (1) the Class B-1 Applied
Realized Loss Amount over (2) the sum of (x)
all distributions in reduction of the Class
B-1 Unpaid Realized Loss Amounts on
all previous Distribution Dates and (y) all
increases in the Certificate
Principal Balance of such Class B-1
Certificates pursuant to the last sentence
of the definition of "Certificate Principal
Balance."
Class B-2
Applied Realized Loss Amount: As of any Distribution Date, the
sum of all Applied Realized Loss Amounts
with respect to the Mortgage Loans
which have been applied to the reduction of
the Certificate Principal Balance of
the Class B-2 Certificates.
Class B-2
Certificate: Any Certificate designated as a "Class B-2
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class B-2
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance
of the Class B-2 Certificates.
Class B-2
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period
at the Class B-2 Pass-Through Rate on
the Class B-2 Certificate Principal Balance
as of such Distribution Date plus
the portion of any previous distributions
on such Class in respect of Current
Interest or a Class B-2 Interest Carry
Forward Amount that is recovered as a
voidable preference by a trustee in
bankruptcy, less any Non-Supported Interest
Shortfall allocated on such Distribution
Date to the Class B-2 Certificates.
Class B-2
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class B-2
Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
B-2 Certificates with respect to interest
on such prior Distribution Dates and
(2) interest on such excess (to the extent
permitted by applicable law) at the
Class B-2 Pass-Through Rate for the related
Accrual Period.
Class B-2
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date for the
Certificates, 1.300% per annum and, as
of any Distribution Date after the Initial
Optional Termination Date, 1.950% per
annum.
Class B-2
Pass-Through Rate: For the first Distribution Date, 4.300% per
annum. As of any Distribution Date
thereafter, the least of (1) One-Month LIBOR
plus the Class B-2 Margin and (2) the
Subordinated Certificate Available Funds
Cap for such Distribution Date.
Class B-2
Principal Distribution Amount: With respect to any Distribution
Date on or after the Stepdown Date, 100% of
the Principal Distribution Amount
for such Distribution Date if the Class A
Certificate Principal Balance, the
Class M Certificate Principal Balance and
the Class B-1 Certificate Principal
Balance have been reduced to zero and a
Stepdown Trigger Event exists, or as
long as a Stepdown Trigger Event does not
exist, the excess of (1) the sum of
(A) the Class A Certificate Principal
Balance (after taking into account
distributions of the Class A Principal
Distribution Amount on such Distribution
Date), (B) the Class M-1 Certificate
Principal Balance (after taking into
account distributions of the Class M-1
Principal Distribution Amount on such
Distribution Date), (C) the Class M-2
Certificate Principal Balance (after
taking into account distributions of the
Class M-2 Principal Distribution Amount
- 11 -
<PAGE>
on such Distribution Date), (D) the Class
M-3 Certificate Principal Balance
(after taking into account distributions of
the Class M-3 Principal Distribution
Amount on such Distribution Date), (E) the
Class B-1 Certificate Principal
Balance (after taking into account
distributions of the Class B-1 Principal
Distribution Amount on such Distribution
Date) and (F) the Class B-2 Certificate
Principal Balance immediately prior to such
Distribution Date over (2) the
lesser of (A) 95.50% of the Stated
Principal Balance of the Mortgage Loans as of
the end of the immediately preceding Due
Period and (B) the excess of the Stated
Principal Balance of the Mortgage Loans as
of the end of the immediately
preceding Due Period over the Minimum
Required Overcollateralization Amount.
Notwithstanding the foregoing, (I) on any
Distribution Date prior to the
Stepdown Date on which the Certificate
Principal Balance of each Class of Class
A, Class M and Class B-1 Certificates has
been reduced to zero, the Class B-2
Principal Distribution Amount will equal
the lesser of (x) the outstanding
Certificate Principal Balance of the Class
B-2 Certificates and (y) 100% of the
Principal Distribution Amount remaining
after any distributions on such Class A,
Class M and Class B-1 Certificates and (II)
in no event will the Class B-2
Principal Distribution Amount with respect
to any Distribution Date exceed the
Class B-2 Certificate Principal
Balance.
Class B-2
Unpaid Realized Loss Amount: As of any Distribution Date, the
excess of (1) the Class B-2 Applied
Realized Loss Amount over (2) the sum of (x)
all distributions in reduction of the Class
B-2 Unpaid Realized Loss Amounts on
all previous Distribution Dates and (y) all
increases in the Certificate
Principal Balance of such Class B-2
Certificates pursuant to the last sentence
of the definition of "Certificate Principal
Balance."
Class B-3
Applied Realized Loss Amount: As of any Distribution Date, the
sum of all Applied Realized Loss Amounts
with respect to the Mortgage Loans
which have been applied to the reduction of
the Certificate Principal Balance of
the Class B-3 Certificates.
Class B-3
Certificate: Any Certificate designated as a "Class B-3
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class B-3
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance
of the Class B-3 Certificates.
Class B-3 Current
Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period
at the Class B-3 Pass-Through Rate on
the Class B-3 Certificate Principal Balance
as of such Distribution Date plus
the portion of any previous distributions
on such Class in respect of Current
Interest or a Class B-3 Interest Carry
Forward Amount that is recovered as a
voidable preference by a trustee in
bankruptcy, less any Non-Supported Interest
Shortfall allocated on such Distribution
Date to the Class B-3 Certificates.
Class B-3
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class B-3
Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
B-3 Certificates with respect to interest
on such prior Distribution Dates and
(2) interest on such excess (to the extent
permitted by applicable law) at the
Class B-3 Pass-Through Rate for the related
Accrual Period.
Class B-3
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date for the
Certificates, 1.750% per annum and, as
of any Distribution Date after the Initial
Optional Termination Date, 2.625% per
annum.
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<PAGE>
Class B-3
Pass-Through Rate: For the first Distribution Date, 4.750% per
annum. As of any Distribution Date
thereafter, the least of (1) One-Month LIBOR
plus the Class B-3 Margin and (2) the
Subordinated Certificate Available Funds
Cap for such Distribution Date.
Class B-3
Principal Distribution Amount: With respect to any Distribution
Date on or after the Stepdown Date, 100% of
the Principal Distribution Amount
for such Distribution Date if the Class A
Certificate Principal Balance, the
Class M Certificate Principal Balance, the
Class B-1 Certificate Principal
Balance and the Class B-2 Certificate
Principal Balance have been reduced to
zero and a Stepdown Trigger Event exists,
or as long as a Stepdown Trigger Event
does not exist, the excess of (1) the sum
of (A) the Class A Certificate
Principal Balance (after taking into
account distributions of the Class A
Principal Distribution Amount on such
Distribution Date), (B) the Class M-1
Certificate Principal Balance (after taking
into account distributions of the
Class M-1 Principal Distribution Amount on
such Distribution Date), (C) the
Class M-2 Certificate Principal Balance
(after taking into account distributions
of the Class M-2 Principal Distribution
Amount on such Distribution Date), (D)
the Class M-3 Certificate Principal Balance
(after taking into account
distributions of the Class M-3 Principal
Distribution Amount on such
Distribution Date), (E) the Class B-1
Certificate Principal Balance (after
taking into account distributions of the
Class B-1 Principal Distribution Amount
on such Distribution Date), (F) the Class
B-2 Certificate Principal Balance
(after taking into account distributions of
the Class B-2 Principal Distribution
Amount on such Distribution Date) and (G)
the Class B-3 Certificate Principal
Balance immediately prior to such
Distribution Date over (2) the lesser of (A)
96.50% of the Stated Principal Balance of
the Mortgage Loans as of the end of
the immediately preceding Due Period and
(B) the excess of the Stated Principal
Balance of the Mortgage Loans as of the end
of the immediately preceding Due
Period over the Minimum Required
Overcollateralization Amount. Notwithstanding
the foregoing, (I) on any Distribution Date
prior to the Stepdown Date on which
the Certificate Principal Balance of each
Class of Class A, Class M, Class B-1
and Class B-2 Certificates has been reduced
to zero, the Class B-3 Principal
Distribution Amount will equal the lesser
of (x) the outstanding Certificate
Principal Balance of the Class B-3
Certificates and (y) 100% of the Principal
Distribution Amount remaining after any
distributions on such Class A, Class M,
Class B-1 and Class B-2 Certificates and
(II) in no event will the Class B-3
Principal Distribution Amount with respect
to any Distribution Date exceed the
Class B-3 Certificate Principal
Balance.
Class B-3
Unpaid Realized Loss Amount: As of any Distribution Date, the
excess of (1) the Class B-3 Applied
Realized Loss Amount over (2) the sum of (x)
all distributions in reduction of the Class
B-3 Unpaid Realized Loss Amounts on
all previous Distribution Dates and (y) all
increases in the Certificate
Principal Balance of such Class B-3
Certificates pursuant to the last sentence
of the definition of "Certificate Principal
Balance"
Class B-4
Applied Realized Loss Amount: As of any Distribution Date, the
sum of all Applied Realized Loss Amounts
with respect to the Mortgage Loans
which have been applied to the reduction of
the Certificate Principal Balance of
the Class B-4 Certificates.
Class B-4
Certificate: Any Certificate designated as a "Class B-4
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class B-4
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance
of the Class B-4 Certificates.
Class B-4
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period
at the Class B-4 Pass-Through Rate on
the Class B-4 Certificate Principal Balance
as of such Distribution Date plus
the portion of any previous distributions
on such Class in respect of Current
Interest or a Class B-4 Interest Carry
Forward Amount that is recovered as a
voidable preference by a
- 13 -
<PAGE>
trustee in bankruptcy, less any
Non-Supported Interest Shortfall allocated on
such Distribution Date to the Class B-4
Certificates.
Class B-4
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class B-4
Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
B-4 Certificates with respect to interest
on such prior Distribution Dates and
(2) interest on such excess (to the extent
permitted by applicable law) at the
Class B-4 Pass-Through Rate for the related
Accrual Period.
Class B-4
Margin: As of any Distribution Date up to and including the
Optional Termination Date for the
Certificates, 3.250% per annum, and, as of any
Distribution Date after the Optional
Termination Date, 4.875% per annum.
Class B-4
Pass-Through Rate: For the first Distribution Date, 6.250% per
annum. As of any Distribution Date
thereafter, the least of (1) One-Month LIBOR
plus the Class B-4 Margin and (2) the
Subordinated Certificate Available Funds
Cap for such Distribution Date.
Class B-4
Principal Distribution Amount: With respect to any Distribution
Date on or after the Stepdown Date, 100% of
the Principal Distribution Amount
for such Distribution Date if the Class A
Certificate Principal Balance, the
Class M Certificate Principal Balance, the
Class B-1 Certificate Principal
Balance, the Class B-2 Certificate
Principal Balance and the Class B-3
Certificate Principal Balance have been
reduced to zero and a Stepdown Trigger
Event exists, or as long as a Stepdown
Trigger Event does not exist, the excess
of (1) the sum of (A) the Class A
Certificate Principal Balance (after taking
into account distributions of the Class A
Principal Distribution Amount on such
Distribution Date), (B) the Class M-1
Certificate Principal Balance (after
taking into account distributions of the
Class M-1 Principal Distribution Amount
on such Distribution Date), (C) the Class
M-2 Certificate Principal Balance
(after taking into account distributions of
the Class M-2 Principal Distribution
Amount on such Distribution Date), (D) the
Class M-3 Certificate Principal
Balance (after taking into account
distributions of the Class M-3 Principal
Distribution Amount on such Distribution
Date), (E) the Class B-1 Certificate
Principal Balance (after taking into
account distributions of the Class B-1
Principal Distribution Amount on such
Distribution Date), (F) the Class B-2
Certificate Principal Balance (after taking
into account distributions of the
Class B-2 Principal Distribution Amount on
such Distribution Date), (G) the
Class B-3 Certificate Principal Balance
(after taking into account distributions
of the Class B-3 Principal Distribution
Amount on such Distribution Date) and
(H) the Class B-4 Certificate Principal
Balance immediately prior to such
Distribution Date over (2) the lesser of
(A) 97.50% of the Stated Principal
Balance of the Mortgage Loans as of the end
of the immediately preceding Due
Period and (B) the excess of the Stated
Principal Balance of the Mortgage Loans
as of the end of the immediately preceding
Due Period over the Minimum Required
Overcollateralization Amount.
Notwithstanding the foregoing, (I) on any
Distribution Date prior to the Stepdown
Date on which the Certificate Principal
Balance of each Class of Class A, Class M,
Class B-1, Class B-2 and Class B-3
Certificates has been reduced to zero, the
Class B-4 Principal Distribution
Amount will equal the lesser of (x) the
outstanding Certificate Principal
Balance of the Class B-4 Certificates and
(y) 100% of the Principal Distribution
Amount remaining after any distributions on
such Class A, Class M, Class B-1,
Class B-2 and Class B-3 Certificates and
(II) in no event will the Class B-4
Principal Distribution Amount with respect
to any Distribution Date exceed the
Class B-4 Certificate Principal
Balance.
Class B-4
Unpaid Realized Loss Amount: As of any Distribution Date, the
excess of (1) the Class B-4 Applied
Realized Loss Amount over (2) the sum of (x)
all distributions in reduction of the Class
B-4 Unpaid Realized Loss Amounts on
all previous Distribution Dates and (y) all
increases in the Certificate
Principal Balance of such Class B-4
Certificates pursuant to the last sentence
of the definition of "Certificate Principal
Balance."
- 14 -
<PAGE>
Class B-5
Applied Realized Loss Amount: As of any Distribution Date, the
sum of all Applied Realized Loss Amounts
with respect to the Mortgage Loans
which have been applied to the reduction of
the Certificate Principal Balance of
the Class B-5 Certificates.
Class B-5
Certificate: Any Certificate designated as a "Class B-5
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class B-5
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance
of the Class B-5 Certificates.
Class B-5
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period
at the Class B-5 Pass-Through Rate on
the Class B-5 Certificate Principal Balance
as of such Distribution Date plus
the portion of any previous distributions
on such Class in respect of Current
Interest or a Class B-5 Interest Carry
Forward Amount that is recovered as a
voidable preference by a trustee in
bankruptcy, less any Non-Supported Interest
Shortfall allocated on such Distribution
Date to the Class B-5 Certificates.
Class B-5
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class B-5
Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
B-5 Certificates with respect to interest
on such prior Distribution Dates and
(2) interest on such excess (to the extent
permitted by applicable law) at the
Class B-5 Pass-Through Rate for the related
Accrual Period.
Class B-5
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date for the
Certificates, 3.250% per annum, and,
as of any Distribution Date after the
Initial Optional Termination Date, 4.875%
per annum.
Class B-5
Pass-Through Rate: For the first Distribution Date 6.250% per
annum. As of any Distribution Date
thereafter, the least of (1) One-Month LIBOR
plus the Class B-5 Margin and (2) the
Subordinated Certificate Available Funds
Cap for such Distribution Date.
Class B-5
Principal Distribution Amount: With respect to any Distribution
Date on or after the Stepdown Date, 100% of
the Principal Distribution Amount
for such Distribution Date if the Class A
Certificate Principal Balance, the
Class M Certificate Principal Balance, the
Class B-1 Certificate Principal
Balance, the Class B-2 Certificate
Principal Balance, the Class B-3 Certificate
Principal Balance and the Class B-4
Certificate Principal Balance have been
reduced to zero and a Stepdown Trigger
Event exists, or as long as a Stepdown
Trigger Event does not exist, the excess of
(1) the sum of (A) the Class A
Certificate Principal Balance (after taking
into account distributions of the
Class A Principal Distribution Amount on
such Distribution Date), (B) the Class
M-1 Certificate Principal Balance (after
taking into account distributions of
the Class M-1 Principal Distribution Amount
on such Distribution Date), (C) the
Class M-2 Certificate Principal Balance
(after taking into account distributions
of the Class M-2 Principal Distribution
Amount on such Distribution Date), (D)
the Class M-3 Certificate Principal Balance
(after taking into account
distributions of the Class M-3 Principal
Distribution Amount on such
Distribution Date), (E) the Class B-1
Certificate Principal Balance (after
taking into account distributions of the
Class B-1 Principal Distribution Amount
on such Distribution Date), (F) the Class
B-2 Certificate Principal Balance
(after taking into account distributions of
the Class B-2 Principal Distribution
Amount on such Distribution Date), (G) the
Class B-3 Certificate Principal
Balance (after taking into account
distributions of the Class B-3 Principal
Distribution Amount on such Distribution
Date), (H) the Class B-4 Certificate
Principal Balance (after taking into
account distributions of the Class B-4
Principal Distribution Amount on such
Distribution Date) and (I) the Class B-5
Certificate Principal Balance immediately
prior to such Distribution Date over
(2) the lesser of (A) 99.00% of the Stated
Principal Balance of the Mortgage
Loans
- 15 -
<PAGE>
as of the end of the immediately preceding
Due Period and (B) the excess of the
Stated Principal Balance of the Mortgage
Loans as of the end of the immediately
preceding Due Period over the Minimum
Required Overcollateralization Amount.
Notwithstanding the foregoing, (I) on any
Distribution Date prior to the
Stepdown Date on which the Certificate
Principal Balance of each Class of Class
A, Class M, Class B-1, Class B-2, Class B-3
and Class B-4 Certificates has been
reduced to zero, the Class B-5 Principal
Distribution Amount will equal the
lesser of (x) the outstanding Certificate
Principal Balance of the Class B-5
Certificates and (y) 100% of the Principal
Distribution Amount remaining after
any distributions on such Class A, Class M,
Class B-1, Class B-2, Class B-3 and
Class B-4 Certificates and (II) in no event
will the Class B-5 Principal
Distribution Amount with respect to any
Distribution Date exceed the Class B-5
Certificate Principal Balance.
Class B-5
Unpaid Realized Loss Amount: As of any Distribution Date, the
excess of (1) the Class B-5 Applied
Realized Loss Amount over (2) the sum of (x)
all distributions in reduction of the Class
B-5 Unpaid Realized Loss Amounts on
all previous Distribution Dates and (y) all
increases in the Certificate
Principal Balance of such Class B-5
Certificates pursuant to the last sentence
of the definition of "Certificate Principal
Balance."
Class C
Applied Realized Loss Amount: As of any Distribution Date, the
sum
of all Applied Realized Loss Amounts with
respect to the Mortgage Loans which
have been applied to the reduction of the
Certificate Principal Balance of the
Class C Certificates.
Class C
Certificate: Any Certificate designated as a "Class C
Certificate"
on the face thereof, in the form of Exhibit
A hereto, representing the right to
distributions as set forth herein.
Class C
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance
of the Class C Certificates.
Class C
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period
at the Class C Distributable Interest
Rate on a notional amount equal to 99.95%
of the aggregate principal balance of
the Lower Tier REMIC Regular Interests
immediately prior to such Distribution
Date (such amount of interest representing
a "specified portion" (within the
meaning of Treasury Regulations Section
1.860G-1(a)(2)(i)(C)) of interest
payments on the Lower Tier REMIC Regular
Interests (other than the Class LTII1B
Interest and the Class LTII2B Interest)),
plus the interest portion of any
previous distributions on such Class that
is recovered as a voidable preference
by a trustee in bankruptcy, less any
Non-Supported Interest Shortfall allocated
on such Distribution Date to the Class C
Certificates.
Class C
Distributable Interest Rate: The excess, if any, of (a) the
weighted average of the interest rates on
the Lower Tier REMIC Regular Interests
over (b) two times the weighted average of
the interest rates on the Lower Tier
REMIC I Marker Interests and the Class LTIX
Interest (treating for purposes of
this clause (b) the interest rate on each
of the Lower Tier REMIC I Marker
Interests as being subject to a cap and a
floor equal to the interest rate of
the Corresponding Certificates and treating
the Class LTIX Interest as being
capped at zero). The averages described in
the preceding sentence shall be
weighted on the basis of the respective
principal balances of the Lower Tier
REMIC Regular Interests immediately prior
to any date of determination.
Class C
Interest Carry Forward Amount: As of any Distribution Date, the
excess of (A) the Class C Current Interest
with respect to prior Distribution
Dates over (B) the amount actually
distributed to the Class C Certificates with
respect to interest on such prior
Distribution Dates or added to the aggregate
Certificate Principal Balance of the Class
C Certificates.
- 16 -
<PAGE>
Class C
Unpaid Realized Loss Amount: As of any Distribution Date, the
excess of (1) the Class C Applied Realized
Loss Amount over (2) the sum of (x)
all distributions in reduction of the Class
C Unpaid Realized Loss Amounts on
all previous Distribution Dates and (y) all
increases in the Certificate
Principal Balance of such Class C
Certificates pursuant to the last sentence of
the definition of "Certificate Principal
Balance."
Class
LTA-1A Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal
balance equal to 1/4 of the initial
principal balance of its Corresponding
Certificates and an interest rate equal
to the Net Rate.
Class
LTA-1B Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal
balance equal to 1/4 of the initial
principal balance of its Corresponding
Certificate and an interest rate equal to
the Net Rate.
Class
LTA-2A Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal
balance equal to 1/4 of the initial
principal balance of its Corresponding
Certificate and an interest rate equal to
the Net Rate.
Class
LTA-2B Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal
balance equal to 1/4 of the initial
principal balance of its Corresponding
Certificate and an interest rate equal to
the Net Rate.
Class
LTA-2C Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal
balance equal to 1/4 of the initial
principal balance of its Corresponding
Certificate and an interest rate equal to
the Net Rate.
Class
LTB-1 Interest: An uncertificated regular interest in the Lower
Tier
REMIC with an initial principal balance
equal to 1/4 of the initial principal
balance of its Corresponding Certificate
and an interest rate equal to the Net
Rate.
Class
LTB-2 Interest: An uncertificated regular interest in the Lower
Tier
REMIC with an initial principal balance
equal to 1/4 of the initial principal
balance of its Corresponding Certificate
and an interest rate equal to the Net
Rate.
Class
LTB-3 Interest: An uncertificated regular interest in the Lower
Tier
REMIC with an initial principal balance
equal to 1/4 of the initial principal
balance of its Corresponding Certificate
and an interest rate equal to the Net
Rate.
Class
LTB-4 Interest: An uncertificated regular interest in the Lower
Tier
REMIC with an initial principal balance
equal to 1/4 of the initial principal
balance of its Corresponding Certificate
and an interest rate equal to the Net
Rate.
Class
LTB-5 Interest: An uncertificated regular interest in the Lower
Tier
REMIC with an initial principal balance
equal to 1/4 of the initial principal
balance of its Corresponding Certificate
and an interest rate equal to the Net
Rate.
Class LTIX
Interest: An uncertificated regular interest in the Lower Tier
REMIC with an initial prinicipal balance
equal to the excess of (i) 50% of the
aggregate Cut-off Date Principal Balance of
the Mortgage Loans over (ii) the
initial principal balance of the Lower Tier
REMIC I Marker Interests, and with
an interest rate equal to the Net Rate.
- 17 -
<PAGE>
Class LTIIX Interest: An
uncertificated regular interest in the Lower Tier
REMIC with an initial principal balance
equal to the excess of (i) 50% of the
aggregate Cut-off Date Principal Balance of
the Mortgage Loans over (ii) the
initial principal balance of the Lower Tier
REMIC II Marker Interests, and with
an interest rate equal to the Net Rate.
Class
LTII1A Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal
balance equal to 0.05% of the excess of (i)
the aggregate Cut-off Date Principal
Balance of the Group One Mortgage Loans
over (ii) the aggregate of the initial
Certificate Principal Balances of
Certificate Group One, and with an interest
rate equal to the Net Rate.
Class
LTII1B Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal
balance equal to 0.05% of the aggregate
Cut-off Date Principal Balance of the Group
One Mortgage Loans, and with an
interest rate equal to the Class A-1
Available Funds Cap.
Class LTII2A
Interest: An uncertificated regular interest in the Lower
Tier REMIC with an initial principal
balance equal to 0.05% of the excess of (i)
the aggregate Cut-off Date Principal
Balance of the Group Two Mortgage Loans
over (ii) the aggregate of the initial
Certificate Principal Balances of
Certificate Group Two, and with an interest
rate equal to the Net Rate.
Class
LTII2B Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal
balance equal to 0.05% of the aggregate
Cut-off Date Principal Balance of the Group
Two Mortgage Loans, and with an
interest rate equal to the Class A-2
Available Funds Cap.
Class
LTM-1 Interest: An uncertificated regular interest in the Lower
Tier
REMIC with an initial principal balance
equal to 1/4 of the initial principal
balance of its Corresponding Certificate
and an interest rate equal to the Net
Rate.
Class
LTM-2 Interest: An uncertificated regular interest in the Lower
Tier
REMIC with an initial principal balance
equal to 1/4 of the initial principal
balance of its Corresponding Certificate
and an interest rate equal to the Net
Rate.
Class
LTM-3 Interest: An uncertificated regular interest in the Lower
Tier
REMIC with an initial principal balance
equal to 1/4 of the initial principal
balance of its Corresponding Certificate
and an interest rate equal to the Net
Rate.
Class LTR
Interest: The sole class of "residual interest" in the Lower
Tier REMIC.
Class M
Certificates: Any of the Class M-1, Class M-2 and Class M-3
Certificates.
Class M
Certificate Principal Balance: For any date of determination,
the
sum of the Class M-1 Certificate Principal
Balance, Class M-2 Certificate
Principal Balance and the Class M-3
Certificate Principal Balance.
Class M-1
Applied Realized Loss Amount: As of any Distribution Date, the
sum of all Applied Realized Loss Amounts
with respect to the Mortgage Loans
which have been applied to the reduction of
the Certificate Principal Balance of
the Class M-1 Certificates.
Class M-1
Certificate: Any Certificate designated as a "Class M-1
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
- 18 -
<PAGE>
Class M-1
Certificate Principal Balance: As of any date of determination,
the aggregate Certificate Principal Balance
of the Class M-1 Certificates.
Class M-1
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period
at the Class M-1 Pass-Through Rate on
the Class M-1 Certificate Principal Balance
as of such Distribution Date plus
the portion of any previous distributions
on such Class in respect of Current
Interest or Class M-1 Interest Carry
Forward Amount that is recovered as a
voidable preference by a trustee in
bankruptcy, less any Non-Supported Interest
Shortfall allocated on such Distribution
Date to the Class M-1 Certificates.
Class M-1
Interest Carry Forward Amount: As of any Distribution Date, the
sum of (1) the excess of (A) the Class M-1
Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
M-1 Certificates with respect to interest
on such prior Distribution Dates and
(2) interest on such excess (to the extent
permitted by applicable law) at the
Class M-1 Pass-Through Rate for the related
Accrual Period.
Class M-1
Margin: As of any Distribution Date up to and including the
Initial Optional Termination Date for the
Certificates, 0.430% per annum and, as
of any Distribution Date after the Initial
Optional Termination Date, 0.645% per
annum.
Class M-1
Pass-Through Rate: For the first Distribution Date, 3.430% per
annum. As of any Distribution Date
thereafter, the least of (1) One-Month LIBOR
plus the Class M-1 Margin and (2) the
Subordinated Certificate Available Funds
Cap for such Distribution Date.
Class M-1
Principal Distribution Amount: With respect to any Distribution
Date on or after the Stepdown Date, 100% of
the Principal Distribution Amount
for such Distribution Date if the Class A
Certificate Principal Balance has been
reduced to zero and a Stepdown Trigger
Event exists, or as long as a Stepdown
Trigger Event does not exist, the excess of
(1) the sum of (A) the Class A
Certificate Principal Balance (after taking
into account distributions of the
Class A Principal Distribution Amount on
such Distribution Date) and (B) the
Class M-1 Certificate Principal Balance
immediately prior to such Distribution
Date over (2) the lesser of (A) 84.40% of
the Stated Principal Balances of the
Mortgage Loans as of the end of the
immediately preceding Due Period and (B) the
excess of the Stated Principal Balances for
the Mortgage Loans as of the end of
the immediately preceding Due Period over
the Minimum Required
Overcollateralization Amount.
Notwithstanding the foregoing, (I) on any
Distribution Date prior to the Stepdown
Date on which the Certificate Principal
Balance of each Class of Class A
Certificates has been reduced to zero, the
Class M-1 Principal Distribution Amount
will equal the lesser of (x) the
outstanding Certificate Principal Balance
of the Class M-1 Certificates and (y)
100% of the Principal Distribution Amount
remaining after any distributions on
such Class A Certificates and (II) in no
event will the Class M-1 Principal
Distribution Amount with respect to any
Distribution Date exceed the Class M-1
Certificate Principal Balance.
Class M-1
Unpaid Realized Loss Amount: As of any Distribution Date, the
excess of (1) the Class M-1 Applied
Realized Loss Amount over (2) the sum of (x)
all distributions in reduction of the Class
M-1 Unpaid Realized Loss Amounts on
all previous Distribution Dates and (y) all
increases in the Certificate
Principal Balance of such Class M-1
Certificates pursuant to the last sentence
of the definition of "Certificate Principal
Balance."
Class M-2
Applied Realized Loss Amount: As of any Distribution Date, the
sum of all Applied Realized Loss Amounts
with respect to the Mortgage Loans
which have been applied to the reduction of
the Certificate Principal Balance of
the Class M-2 Certificates.
- 19 -
<PAGE>
Class M-2 Certificate: Any Certificate designated as a "Class
M-2
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class M-2 Certificate Principal Balance: As of any date of
determination, the aggregate Certificate
Principal Balance of the Class M-2
Certificates.
Class M-2 Current Interest: As of any Distribution Date, the
interest
accrued during the related Accrual Period
at the Class M-2 Pass-Through Rate on
the Class M-2 Certificate Principal Balance
as of such Distribution Date plus
the portion of any previous distributions
on such Class in respect of Current
Interest or Class M-2 Interest Carry
Forward Amount that is recovered as a
voidable preference by a trustee in
bankruptcy, less any Non-Supported Interest
Shortfall allocated on such Distribution
Date to the Class M-2 Certificates.
Class M-2 Interest Carry Forward Amount: As of any Distribution
Date,
the sum of (1) the excess of (A) the Class
M-2 Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
M-2 Certificates with respect to interest
on such prior Distribution Dates and
(2) interest on such excess (to the extent
permitted by applicable law) at the
Class M-2 Pass-Through Rate for the related
Accrual Period.
Class M-2 Margin: As of any Distribution Date up to and including
the
Initial Optional Termination Date for the
Certificates, 0.630% per annum and, as
of any Distribution Date after the Initial
Optional Termination Date, 0.945% per
annum.
Class M-2 Pass-Through Rate: For the first Distribution Date,
3.630%
per annum. As of any Distribution Date
thereafter, the least of (1) One-Month
LIBOR plus the Class M-2 Margin and (2) the
Subordinated Certificate Available
Funds Cap for such Distribution Date.
Class M-2 Principal Distribution Amount: With respect to any
Distribution Date on or after the Stepdown
Date, 100% of the Principal
Distribution Amount for such Distribution
Date if the Class A Certificate
Principal Balance and the Class M-1
Certificate Principal Balance have been
reduced to zero and a Stepdown Trigger
Event exists, or as long as a Stepdown
Trigger Event does not exist, the excess of
(1) the sum of (A) the Class A
Certificate Principal Balance (after taking
into account distributions of the
Class A Principal Distribution Amount on
such Distribution Date), (B) the Class
M-1 Certificate Principal Balance (after
taking into account distributions of
the Class M-1 Principal Distribution Amount
on such Distribution Date) and (C)
the Class M-2 Certificate Principal Balance
immediately prior to such
Distribution Date over (2) the lesser of
(A) 92.10% of the Stated Principal
Balances of the Mortgage Loans as of the
end of the immediately preceding Due
Period and (B) the excess of the Stated
Principal Balances of the Mortgage Loans
as of the end of the immediately preceding
Due Period over the Minimum Required
Overcollateralization Amount.
Notwithstanding the foregoing, (I) on any
Distribution Date prior to the Stepdown
Date on which the Certificate Principal
Balance of each Class of Class A
Certificates and the Class M-1 Certificates has
been reduced to zero, the Class M-2
Principal Distribution Amount will equal the
lesser of (x) the outstanding Certificate
Principal Balance of the Class M-2
Certificates and (y) 100% of the Principal
Distribution Amount remaining after
any distributions on such Class A
Certificates and Class M-1 Certificates and
(II) in no event will the Class M-2
Principal Distribution Amount with respect
to any Distribution Date exceed the Class
M-2 Certificate Principal Balance.
Class M-2 Unpaid Realized Loss Amount: As of any Distribution Date,
the
excess of (1) the Class M-2 Applied
Realized Loss Amount over (2) the sum of (x)
all distributions in reduction of the Class
M-2 Unpaid Realized Loss Amounts on
all previous Distribution Dates and (y) all
increases in the
- 20 -
<PAGE>
Certificate Principal Balance of such Class
M-2 Certificates pursuant to the
last sentence of the definition of
"Certificate Principal Balance."
Class M-3 Applied Realized Loss Amount: As of any Distribution
Date,
the sum of all Applied Realized Loss
Amounts with respect to the Mortgage Loans
which have been applied to the reduction of
the Certificate Principal Balance of
the Class M-3 Certificates.
Class M-3 Certificate: Any Certificate designated as a "Class
M-3
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class M-3 Certificate Principal Balance: As of any date of
determination, the aggregate Certificate
Principal Balance of the Class M-3
Certificates.
Class M-3 Current Interest: As of any Distribution Date, the
interest
accrued during the related Accrual Period
at the Class M-3 Pass-Through Rate on
the Class M-3 Certificate Principal Balance
as of such Distribution Date plus
the portion of any previous distributions
on such Class in respect of Current
Interest or Class M-3 Interest Carry
Forward Amount that is recovered as a
voidable preference by a trustee in
bankruptcy, less any Non-Supported Interest
Shortfall allocated on such Distribution
Date to the Class M-3 Certificates.
Class M-3 Interest Carry Forward Amount: As of any Distribution
Date,
the sum of (1) the excess of (A) the Class
M-3 Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
M-3 Certificates with respect to interest
on such prior Distribution Dates and
(2) interest on such excess (to the extent
permitted by applicable law) at the
Class M-3 Pass-Through Rate for the related
Accrual Period.
Class M-3 Margin: As of any Distribution Date up to and including
the
Initial Optional Termination Date for the
Certificates, 0.690% per annum and, as
of any Distribution Date after the Initial
Optional Termination Date, 1.035% per
annum.
Class M-3 Pass-Through Rate: For the first Distribution Date,
3.690%
per annum. As of any Distribution Date
thereafter, the least of (1) One-Month
LIBOR plus the Class M-3 Margin and (2) the
Subordinated Certificate Available
Funds Cap for such Distribution Date.
Class M-3 Principal Distribution Amount: With respect to any
Distribution Date on or after the Stepdown
Date, 100% of the Principal
Distribution Amount for such Distribution
Date if the Class A Certificate
Principal Balance, Class M-1 Certificate
Principal Balance and Class M-2
Certificate Principal Balance have been
reduced to zero and a Stepdown Trigger
Event exists, or as long as a Stepdown
Trigger Event does not exist, the excess
of (1) the sum of (A) the Class A
Certificate Principal Balance (after taking
into account distributions of the Class A
Principal Distribution Amount on such
Distribution Date), (B) the Class M-1
Certificate Principal Balance (after
taking into account distributions of the
Class M-1 Principal Distribution Amount
on such Distribution Date), (C) the Class
M-2 Certificate Principal Balance
(after taking into account distributions of
the Class M-2 Principal Distribution
Amount on such Distribution Date) and (D)
the Class M-3 Certificate Principal
Balance immediately prior to such
Distribution Date over (2) the lesser of (A)
93.30% of the Stated Principal Balances of
the Mortgage Loans as of the end of
the immediately preceding Due Period and
(B) the excess of the Stated Principal
Balances for the Mortgage Loans as of the
end of the immediately preceding Due
Period over the Minimum Required
Overcollateralization Amount. Notwithstanding
the foregoing, (I) on any Distribution Date
prior to the Stepdown Date on which
the Certificate Principal Balance of each
Class of Class A Certificates, the
Class M-1 Certificates and the Class M-2
Certificates has been reduced to zero,
the Class M-3 Principal Distribution Amount
will equal the lesser of (x) the
outstanding Certificate
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<PAGE>
Principal Balance of the Class M-3
Certificates and (y) 100% of the Principal
Distribution Amount remaining after any
distributions on such Class A, Class M-1
and Class M-2 Certificates and (II) in no
event will the Class M-3 Principal
Distribution Amount with respect to any
Distribution Date exceed the Class M-3
Certificate Principal Balance.
Class M-3 Unpaid Realized Loss Amount: As of any Distribution Date,
the
excess of (1) the Class M-3 Applied
Realized Loss Amount over (2) the sum of (x)
all distributions in reduction of the Class
M-3 Unpaid Realized Loss Amounts on
all previous Distribution Dates and (y) all
increases in the Certificate
Principal Balance of such Class M-3
Certificates pursuant to the last sentence
of the definition of "Certificate Principal
Balance."
Class P Certificate: Any Certificate designated as a "Class P
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class R Certificate: Any Certificate designated as a "Class R
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class R Certificate Principal Balance: As of any date of
determination,
the aggregate Certificate Principal Balance
of the Class R Certificate.
Class R
Current Interest: As of any Distribution Date, the interest
accrued during the related Accrual Period
at the Class R Pass-Through Rate on
the Class R Certificate Principal Balance
as of such Distribution Date plus the
portion of any previous distributions on
such Class in respect of Current
Interest or a Class R Interest Carry
Forward Amount that is recovered as a
voidable preference by a trustee in
bankruptcy, less any Non-Supported Interest
Shortfall allocated on such Distribution
Date to the Class R Certificate.
Class R Interest Carry Forward Amount: As of any Distribution Date,
the
sum of (1) the excess of (A) the Class R
Current Interest with respect to prior
Distribution Dates over (B) the amount
actually distributed to the Class R
Certificate with respect to interest on
such prior Distribution Dates and (2)
interest on such excess (to the extent
permitted by applicable law) at the Class
R Pass-Through Rate for the related Accrual
Period.
Class R Margin: As of any Distribution Date up to and including
the
Initial Optional Termination Date for the
Certificates, 0.210% per annum and, as
of any Distribution Date after the Initial
Optional Termination Date, 0.420% per
annum.
Class R Pass-Through Rate: For the first Distribution Date, 3.210%
per
annum. As of any Distribution Date
thereafter, the least of (1) One-Month LIBOR
plus the Class R Margin and (2) the Class
A-1 Available Funds Cap for such
Distribution Date.
Closing Date: April
21, 2005.
Code: The Internal Revenue Code of 1986, including any successor
or
amendatory provisions.
Collection Account: The separate Eligible Account created and
initially
maintained by the Servicer pursuant to
Section 3.05(d) in the name of the
Trustee for the benefit of the
Certificateholders and designated "Wilshire
Credit Corporation, as servicer for Wells
Fargo Bank, N.A., as Trustee, in trust
for registered holders of Merrill Lynch
Mortgage Investors Trust, Mortgage Loan
Asset-Backed Certificates, Series
2005-HE1." Funds in the Collection Account
shall be held in trust for the
Certificateholders for the uses and purposes set
forth in this Agreement.
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<PAGE>
Combined Loan-to-Value Ratio: For any Mortgage Loan in a second
lien
position, the fraction, expressed as a
percentage, the numerator of which is the
sum of (1) the original principal balance
of the related Mortgage Loan and (2)
any outstanding principal balances of
Mortgage Loans the liens on which are
senior to the lien on such related Mortgage
Loan (such sum calculated at the
date of origination of such related
Mortgage Loan) and the denominator of which
is the lesser of (A) the Appraised Value of
the related Mortgaged Property (or
applicable dwelling unit, in the case of a
Co-op Loan) and (B) the sales price
of the related Mortgaged Property (or
applicable dwelling unit, in the case of a
Co-op Loan) at time of origination.
Compensating Interest: With respect to any Mortgage Loan and
any
Distribution Date, an amount equal to the
portion of any Prepayment Interest
Shortfalls required to be deposited in the
Collection Account by the Servicer
pursuant to Section 4.02 hereof.
Condemnation Proceeds: All awards or settlements in respect of
a
Mortgaged Property (or Underlying Mortgaged
Property, in the case of a Co-op
Loan), whether permanent or temporary,
partial or entire, by exercise of the
power of eminent domain or condemnation, to
the extent not required to be
released either to a Mortgagor in
accordance with the terms of the related
mortgage loan documents or to the holder of
a senior lien on the Mortgaged
Property (or Underlying Mortgaged Property,
in the case of a Co-op Loan).
Co-op Lease: With respect to a Co-op Loan, the lease with respect
to a
dwelling unit occupied by the Mortgagor and
relating to the stock allocated to
the related dwelling unit.
Co-op Loan: A Mortgage Loan secured by the pledge of stock
allocated to
a dwelling unit in a residential
cooperative housing corporation and a
collateral assignment of the related Co-op
Lease.
Corresponding Certificates: With respect to the Class LTA-1A
Interest,
the Class A-1A and Class R Certificates.
With respect to the Class LTA-1B
Interest, the Class A-1B Certificates. With
respect to the Class LTA-2A
Interest, the Class A-2A Certificates. With
respect to the Class LTA-2B
Interest, the Class A-2B Certificates. With
respect to the Class LTA-2C
Interest, the Class A-2C Certificates. With
respect to the Class LTM-1 Interest,
the Class M-1 Certificates. With respect to
the Class LTM-2 Interest, the Class
M-2 Certificates. With respect to the Class
LTM-3 Interest, the Class M-3
Certificates. With respect to the Class
LTB-1 Interest, the Class B-1
Certificates. With respect to the Class
LTB-2 Interest, the Class B-2
Certificates. With respect to the Class
LTB-3 Interest, the Class B-3
Certificates. With respect to the Class
LTB-4 Interest, the Class B-4
Certificates. With respect to the Class
LTB-5 Interest, the Class B-5
Certificates.
Current Interest: Any of the Class A-1A Current Interest, the
Class
A-1B Current Interest, the Class A-2A
Current Interest, the Class A-2B Current
Interest, the Class A-2C Current Interest,
the Class R Current Interest, the
Class M-1 Current Interest, the Class M-2
Current Interest, the Class M-3
Current Interest, the Class B-1 Current
Interest, the Class B-2 Current
Interest, the Class B-3 Current Interest,
the Class B-4 Current Interest, the
Class B-5 Current Interest and the Class C
Current Interest.
Cut-off Date: March 1,
2005.
Cut-off Date Principal Balance: As to any Mortgage Loan, the
unpaid
principal balance thereof as of the close
of business on the calendar day
immediately preceding the Cut-off Date
after application of all payments of
principal due on or prior to the Cut-off
Date, whether or not received, and all
Principal Prepayments received prior to the
Cut-off Date, but without giving
effect to any installments of principal
received in respect of Due Dates after
the Cut-off Date.
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<PAGE>
Definitive Certificates: As defined in Section 5.06.
Deleted Mortgage Loan: A Mortgage Loan replaced or to be replaced
by a
Replacement Mortgage Loan.
Delinquent: A Mortgage Loan is "delinquent" if any payment due
thereon
is not made pursuant to the terms of such
Mortgage Loan by the close of business
on the day such payment is scheduled to be
due. A Mortgage Loan is "30 days
delinquent" if such payment has not been
received by the close of business on
the corresponding day of the month
immediately succeeding the month in which
such payment was due, or, if there is no
such corresponding day (e.g., as when a
30-day month follows a 31-day month in
which a payment was due on the 31st day
of such month), then on the last day of
such immediately succeeding month.
Similarly for "60 days delinquent," "90
days delinquent" and so on.
Denomination: With respect to each Certificate, the amount set
forth on
the face thereof as the "Initial Principal
Balance of this Certificate."
Depositor: Merrill Lynch Mortgage Investors, Inc., a Delaware
corporation, or any successor in
interest.
Depository: The initial Depository shall be The Depository
Trust
Company ("DTC"), the nominee of which is
Cede & Co., or any other organization
registered as a "clearing agency" pursuant
to Section 17A of the Securities
Exchange Act of 1934, as amended. The
Depository shall initially be the
registered Holder of the Book-Entry
Certificates. The Depository shall at all
times be a "clearing corporation" as
defined in Section 8-102(3) of the Uniform
Commercial Code of the State of New
York.
Depository Agreement: With respect to Classes of Book-Entry
Certificates, the agreement between the
Trustee and the initial Depository.
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.
Designated Transaction: A transaction in which the assets
underlying
the Certificates consist of single-family
residential, multi-family residential,
home equity, manufactured housing and/or
commercial mortgage obligations that
are secured by single-family residential,
multi-family residential, commercial
real property or leasehold interests
therein.
Determination Date: With respect to any Distribution Date, the 15th
day
of the month of such Distribution Date or,
if such 15th day is not a Business
Day, the immediately preceding Business
Day.
Disqualified Organization: (1) the United States, any state or
political subdivision thereof, any foreign
government, any international
organization, or any agency or
instrumentality of any of the foregoing, (2) any
organization (other than a cooperative
described in Section 521 of the Code)
which is exempt from tax under Chapter 1 of
Subtitle A of the Code unless such
organization is subject to the tax imposed
by Section 511 of the Code and (3)
any organization described in Section
1381(a)(2)(C) of the Code.
Distribution Date: The 25th day of each calendar month, or if such
25th
day is not a Business Day, the next
succeeding Business Day, commencing in April
2005.
- 24 -
<PAGE>
Due Date: With respect to any Distribution Date and any Mortgage
Loan,
the day during the related Due Period on
which a Scheduled Payment is due.
Due Period: With respect to any Distribution Date, the period
beginning
on the second day of the calendar month
preceding the calendar month in which
such Distribution Date occurs and ending on
the first day of the month in which
such Distribution Date occurs.
Eligible Account: An account that is (i) maintained with a
depository
institution the long-term unsecured debt
obligations of which are rated by each
Rating Agency in one of its two highest
rating categories, or (ii) maintained
with the corporate trust department of a
bank which (A) has a rating of at least
Baa3 or P-3 by Moody's and (B) is either
the Depositor or the corporate trust
department of a national bank or banking
corporation which has a rating of at
least A-1 by S&P or F1 by Fitch, or
(iii) an account or accounts the deposits in
which are fully insured by the FDIC, or
(iv) an account or accounts, acceptable
to each Rating Agency without reduction or
withdrawal of the rating of any Class
of Certificates, as evidenced in writing,
by a depository institution in which
such accounts are insured by the FDIC (to
the limit established by the FDIC),
the uninsured deposits in which accounts
are otherwise secured such that, as
evidenced by an Opinion of Counsel
delivered to and acceptable to the Trustee,
the NIMs Insurer and each Rating Agency,
the Certificateholders have a claim
with respect to the funds in such account
and a perfected first 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 with which such account is
maintained, or (v) maintained at an
eligible institution whose commercial paper,
short-term debt or other short-term
deposits are rated at least A-1+ by S&P and
F-1+ by Fitch, or (vi) maintained with a
federal or state chartered depository
institution the deposits in which are
insured by the FDIC to the applicable
limits and the short-term unsecured debt
obligations of which (or, in the case
of a depository institution that is a
subsidiary of a holding company, the
short-term unsecured debt obligations of
such holding company) are rated A-1 by
S&P or Prime-1 by Moody's at the time
any deposits are held on deposit therein,
(vii) a segregated trust account or
accounts maintained with a federal or state
chartered depository institution or trust
company acting in its fiduciary
capacity, that is acceptable to the Rating
Agencies or (viii) otherwise
acceptable to each Rating Agency, as
evidenced by a letter from each Rating
Agency to the Trustee and the NIMs
Insurer.
ERISA: The Employee Retirement Income Security Act of 1974,
including
any successor or amendatory provisions.
ERISA-Qualifying Underwriting: A best efforts or firm
commitment
underwriting or private placement that
would satisfy the requirements of
Prohibited Transaction Exemption 90-29,
Exemption Application No. D-8012, 55
Fed. Reg. 21459 (1990), as amended, granted
to the Underwriter by the United
States Department of Labor (or any other
applicable underwriter's exemption
granted by the United States Department of
Labor), except, in relevant part, for
the requirement that the certificates have
received a rating at the time of
acquisition that is in one of the three (or
four, in the case of a "designated
transaction") highest generic rating
categories by at least one of the Rating
Agencies.
ERISA Restricted Certificates: The Class C, Class P and Class R
Certificates and any other Certificate,
unless the acquisition and holding of
such other Certificate is covered by and
exempt under the Underwriter's
exemption.
Event of Default: As
defined in Section 7.01 hereof.
Excess Interest: On any Distribution Date, for each Class of the
Class
A, Class M and Class B Certificates, the
excess, if any, of (1) the amount of
interest such Class of Certificates is
entitled to receive on such Distribution
Date at its Pass-Through Rate over (2) the
amount of interest such Class of
- 25 -
<PAGE>
Certificates would have been entitled to
receive on such Distribution Date had
the Pass-Through Rate for such Class been
the REMIC Pass-Through Rate.
Excess Proceeds: With respect to any Liquidated Loan, any
Liquidation
Proceeds that are in excess of the sum of
(1) the unpaid principal balance of
such Liquidated Loan as of the date of such
liquidation plus (2) interest at the
Mortgage Rate from the Due Date as to which
interest was last paid or advanced
to Certificateholders (and not reimbursed
to the Servicer) up to the Due Date in
the month in which such Liquidation
Proceeds are required to be distributed on
the unpaid principal balance of such
Liquidated Loan outstanding during each Due
Period as to which such interest was not
paid or advanced.
Exchange Act: The
Securities Exchange Act of 1934, as amended.
Extra Principal Distribution Amount: With respect to any
Distribution
Date, (1) prior to the Stepdown Date, the
excess of (A) the sum of (i) the
Aggregate Certificate Principal Balance
immediately preceding such Distribution
Date reduced by the Principal Funds with
respect to such Distribution Date and
(ii) $2,086,678 over (B) the aggregate
Stated Principal Balance of the Mortgage
Loans as of such Distribution Date and (2)
on and after the Stepdown Date, (A)
the sum of (x) the Aggregate Certificate
Principal Balance immediately preceding
such Distribution Date, reduced by the
Principal Funds with respect to such
Distribution Date and (y) the greater of
(a) 1.00% of the aggregate Stated
Principal Balance of the Mortgage Loans and
(b) the Minimum Required
Overcollateralization Amount less (B) the
aggregate Stated Principal Balance of
the Mortgage Loans as of such Distribution
Date; provided, however, that if on
any Distribution Date a Stepdown Trigger
Event is in effect, the Extra Principal
Distribution Amount will not be reduced to
the applicable percentage of the
then-current aggregate Stated Principal
Balance of the Mortgage Loans (and will
remain fixed at the applicable percentage
of the aggregate Stated Principal
Balance of the Mortgage Loans as of the Due
Date immediately prior to the
Stepdown Trigger Event) until the next
Distribution Date on which the Stepdown
Trigger Event is not in effect.
Fannie Mae: A federally chartered and privately owned
corporation
organized and existing under the Federal
National Mortgage Association Charter
Act, or any successor thereto.
FDIC: The Federal Deposit Insurance Corporation, or any
successor
thereto.
Fitch: Fitch, Inc., or
any successor in interest.
Fixed Rate Mortgage Loan: A Mortgage Loan identified in the
Mortgage
Loan Schedule as having a Mortgage Rate
which is fixed.
Floating Rate Certificate Carryover: With respect to a
Distribution
Date, in the event that the Pass-Through
Rate for a class of Class A, Class M or
Class B Certificates is based upon the
related Available Funds Cap, the excess
of (1) the amount of interest that such
Class would have been entitled to
receive on such Distribution Date had the
Pass-Through Rate for that Class not
been calculated based on the related
Available Funds Cap, up to but not
exceeding greater of (x) the related
Maximum Rate Cap or (y) the sum of (i) the
related Available Funds Cap and (ii) the
product of (A) a fraction, the
numerator of which is 360 and the
denominator of which is the actual number of
days in the related Accrual Period and (B)
the quotient obtained by dividing (I)
an amount equal to the proceeds, if any,
payable under the related Cap Contract
with respect to such Distribution Date by
(II) the aggregate Certificate
Principal Balance of each of the Classes of
Certificates to which such Cap
Contract relates for such Distribution Date
over (2) the amount of interest such
class was entitled to receive on such
Distribution Date based on the related
Available Funds Cap, together with (i) the
unpaid portion of any such excess
from prior Distribution Dates (and interest
accrued thereon at the then
applicable Pass-Through Rate, without
giving
- 26 -
<PAGE>
effect to the applicable Available Funds
Cap) and (ii) any amount previously
distributed with respect to Floating Rate
Certificate Carryover for such class
that is recovered as a voidable preference
by a trustee in bankruptcy.
Freddie Mac: A corporate instrumentality of the United States
created
and existing under Title III of the
Emergency Home Finance Act of 1970, as
amended, or any successor thereto.
Grantor Trusts: The
grantor trusts described in Section 2.07 hereof.
Gross Margin: The percentage set forth in the related Mortgage Note
for
each of the Adjustable Rate Mortgage Loans
which is to be added to the
applicable index for use in determining the
Mortgage Rate on each Adjustment
Date, and which is set forth in the
Mortgage Loan Schedule for each Adjustable
Rate Mortgage Loan.
Group One: The portion of the Mortgage Pool identified as "Group
One"
in the Prospectus Supplement.
Group One Mortgage Loan: Any Mortgage Loan at any time identified
in
the Group One Mortgage Loan Schedule
attached hereto as Exhibit B-2.
Group One Principal Distribution Amount: As of any Distribution
Date,
the amount equal to the lesser of (i) the
aggregate Certificate Principal
Balance of the Class A-1 and Class R
Certificates and (ii) the product of (x)
the Group One Principal Distribution
Percentage and (y) the Class A Principal
Distribution Amount; provided, however,
that with respect to any Distribution
Date on which the Class A-1 and Class R
Certificates are outstanding and the
Certificate Principal Balance of the Class
A-2 Certificates has been reduced to
zero, the Group One Principal Distribution
Amount will equal the Class A
Principal Distribution Amount.
Group One Principal Distribution Percentage: With respect to
any
Distribution Date, a fraction expressed as
a percentage, the numerator of which
is the amount of Principal Funds received
with respect to Mortgage Loans in
Group One and the denominator of which is
the amount of Principal Funds received
from all of the Mortgage Loans in the
mortgage pool.
Group Two: The portion of the Mortgage Pool identified as "Group
Two"
in the Prospectus Supplement.
Group Two Mortgage Loan: Any Mortgage Loan at any time identified
in
the Group Two Mortgage Loan Schedule
attached hereto as Exhibit B-3.
Group Two Principal Distribution Amount: As of any Distribution
Date,
the amount equal to the lesser of (i) the
aggregate Certificate Principal
Balance of the Class A-2 Certificates and
(ii) the product of (x) the Group Two
Principal Distribution Percentage and (y)
the Class A Principal Distribution
Amount; provided, however, that with
respect to any Distribution Date on which
the Class A-2 Certificates are outstanding
and the Certificate Principal
Balances of the Class A-1 and Class R
Certificates have been reduced to zero,
the Group Two Principal Distribution Amount
will equal the Class A Principal
Distribution Amount.
Group Two Principal Distribution Percentage: With respect to
any
Distribution Date, a fraction expressed as
a percentage, the numerator of which
is the amount of Principal Funds received
with respect to Mortgage Loans in
Group Two and the denominator of which is
the amount of Principal Funds received
from all of the Mortgage Loans in the
mortgage pool.
- 27 -
<PAGE>
Indenture: An indenture relating to the issuance of notes
guaranteed by
the NIMs Insurer.
Initial Adjustment Date: As to any Adjustable Rate Mortgage Loan,
the
first Adjustment Date following the
origination of such Mortgage Loan.
Initial Certificate Principal Balance: With respect to any
Certificate,
the Certificate Principal Balance of such
Certificate or any predecessor
Certificate on the Closing Date as set
forth in Section 5.01 hereof.
Initial Mortgage Rate: As to each Mortgage Loan, the Mortgage Rate
in
effect prior to the Initial Adjustment
Date.
Initial Optional Termination Date: The first Distribution Date on
which
the aggregate Stated Principal Balance of
the Mortgage Loans is equal to or less
than 10% of the aggregate Stated Principal
Balance of the Mortgage Loans as of
the Cut-off Date.
Insurance Policy: With respect to any Mortgage Loan or the
related
Mortgaged Property (or the related
Underlying Mortgaged Property, in the case of
a Co-op Loan) included in the Trust Fund,
any insurance policy, including all
riders and endorsements thereto in effect
with respect to such Mortgage Loan or
Mortgaged Property (or related Underlying
Mortgage Property, in the case of a
Co-op Loan), including any replacement
policy or policies for any insurance
policies, including, without limitation,
the MI Policies.
Insurance Proceeds: Proceeds paid in respect of a Mortgage Loan or
the
related Mortgaged Property (or the related
Underlying Mortgaged Property, in the
case of a Co-op Loan) pursuant to any
Insurance Policy or any other insurance
policy covering such Mortgage Loan or
Mortgaged Property (or Underlying
Mortgaged Property, in the case of a Co-op
Loan), to the extent such proceeds
are payable to the mortgagee under the
Mortgage, the Servicer or the trustee
under the deed of trust and are not applied
to the restoration of the related
Mortgaged Property (or the related
Underlying Mortgaged Property, in the case of
a Co-op Loan) or released either to the
Mortgagor or to the holder of a senior
lien on the related Mortgaged Property (or
the related Underlying Mortgaged
Property in the case of a Co-op Loan) in
accordance with the procedures that the
Servicer would follow in servicing mortgage
loans held for its own account, 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 a Mortgage
Loan or the related Mortgaged
Property (or the related Underlying
Mortgaged Property, in the case of a Co-op
Loan).
Interest Carry Forward Amount: Any of the Class A-1A Interest
Carry
Forward Amount, the Class A-1B Interest
Carry Forward Amount, the Class A-2A
Interest Carry Forward Amount, the Class
A-2B Interest Carry Forward Amount, the
Class A-2C Interest Carry Forward Amount,
the Class R Interest Carry Forward
Amount, the Class M-1 Interest Carry
Forward Amount, the Class M-2 Interest
Carry Forward Amount, the Class M-3
Interest Carry Forward Amount, the Class B-1
Interest Carry Forward Amount, the Class
B-2 Interest Carry Forward Amount, the
Class B-3 Interest Carry Forward Amount,
the Class B-4 Interest Carry Forward
Amount, the Class B-5 Interest Carry
Forward Amount or the Class C Interest
Carry Forward Amount, as the case may
be.
Interest Determination Date: With respect to the Certificates, (i)
for
any Accrual Period other than the first
Accrual Period, the second LIBOR
Business Day preceding the commencement of
such Accrual Period and (ii) for the
first Accrual Period, April 19, 2005.
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<PAGE>
Interest Funds: With respect to any Distribution Date, the sum,
without
duplication, of (1) all scheduled interest
due during the related Due Period and
received before the related Servicer
Remittance Date or advanced on or before
the related Servicer Remittance Date less
the Servicing Fee, (2) all Advances
relating to interest with respect to the
Mortgage Loans and such Distribution
Date, (3) all Compensating Interest with
respect to the Mortgage Loans and such
Distribution Date, (4) Liquidation Proceeds
with respect to the Mortgage Loans
(to the extent such Liquidation Proceeds
relate to interest) collected during
the related Prepayment Period, (5) all
proceeds of any purchase pursuant to
Section 2.02 or 2.03 during the related
Prepayment Period or pursuant to Section
9.01 not later than the related
Determination Date (to the extent that such
proceeds relate to interest) less the
Servicing Fee, (6) all Prepayment Charges
received with respect to the Mortgage Loans
during the related Prepayment Period
and (7) refunds, if any, of amounts paid to
either of the MI Insurers as MI
Insurer Fees, less (A) all Non-Recoverable
Advances relating to interest and (B)
other amounts reimbursable to the Servicer
and the Trustee pursuant to this
Agreement.
Latest Possible Maturity Date: The latest maturity date for any
Mortgage Loan in the Trust Fund plus one
year.
LIBOR Business Day: Any day on which banks in the City of
London,
England and New York City, U.S.A. are open
and conducting transactions in
foreign currency and exchange.
Liquidated Loan: With respect to any Distribution Date, a
defaulted
Mortgage Loan that either (a) pursuant to
Section 3.12 has been realized upon or
liquidated through deed-in-lieu of
foreclosure, foreclosure sale, trustee's sale
or other realization as provided by
applicable law governing the real property
subject to the related Mortgage and any
security agreements and as to which the
Servicer has certified (in accordance with
Section 3.12) in the related
Prepayment Period that it has received all
amounts it expects to receive in
connection with such liquidation or (b) as
to which is not a first lien Mortgage
Loan and is delinquent 180 days or longer,
the Servicer has certified in a
certificate of an officer of the Servicer
delivered to the Depositor and the
Trustee that it does not believe that there
is a reasonable likelihood that any
further net proceeds will be received or
recovered with respect to such Mortgage
Loan.
Liquidation Proceeds: Amounts, including Condemnation Proceeds,
Insurance Proceeds, received in connection
with the partial or complete
liquidation of a Mortgage Loan, whether
through trustee's sale, foreclosure
sale, sale by the Servicer pursuant to this
Agreement 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 the final sale of a
related REO Property, less the sum of
related unreimbursed Advances, Servicing
Fees, Servicing Advances and any other
expenses related to such Mortgage Loan.
Loan-to-Value Ratio: With respect to any Mortgage Loan, the
fraction,
expressed as a percentage, the numerator of
which is the original principal
balance of the related Mortgage Loan and
the denominator of which is the lesser
of (X) the Appraised Value of the related
Mortgaged Property (or applicable
dwelling unit, in the case of a Co-op Loan)
and (Y) the sales price of the
related Mortgaged Property (or applicable
dwelling unit, in the case of a Co-op
Loan) at the time of origination.
Losses: Any losses, claims, damages, liabilities or expenses
collectively.
Lower Tier REMIC: As described in the Preliminary Statement and
Section
2.07.
Lower Tier REMIC Interests: Each of the Class LTA-1A Interest,
the
Class LTA-1B Interest, the Class LTA-2A
Interest, the Class LTA-2B Interest, the
Class LTA-2C Interest, the Class LTM-1
Interest,
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the Class LTM-2 Interest, the Class LTM-3
Interest, the Class LTB-1 Interest,
the Class LTB-2 Interest, the Class LTB-3
Interest, the Class LTB-4 Interest,
the Class LTB-5 Interest, the Class LTIX
Interest, the Class LTIIX Interest, the
Class LTII1A Interest, the Class LTII1B
Interest, the Class LTII2A Interest, the
Class LTII2B Interest and the Class LTR
Interest.
Lower Tier REMIC I Marker Interests: Each of the classes of Lower
Tier
REMIC Regular Interests other than the
Class LTIX Interest, the Class LTIIX
Interest, the Class LTII1A Interest, the
Class LTII1B Interest, the Class LTII2A
Interest, the Class LTII2B Interest.
Lower Tier REMIC II Marker Interests: Each of the Class LTII1A
Interest, the Class LTII1B Interest, the
Class LTII2A Interest and the Class
LTII2B Interest.
Lower Tier REMIC Regular Interests: Each of the Lower Tier
REMIC
Interests other than the Class LTR
Interest.
Lower Tier REMIC Subordinated Balance Ratio: The ratio of (i)
the
principal balance of the Class LTII1A
Interest to (ii) the principal balance of
the Class LTII2A Interest that is equal to
the ratio of (i) the excess of (A)
the aggregate Stated Principal Balance of
Group One over (B) the current
Certificate Principal Balance of the Class
A-1 and Class R Certificates to (ii)
the excess of (A) the aggregate Stated
Principal Balance of Group Two over (B)
the current Certificate Principal Balance
of the Class A-2 Certificates.
Maximum Mortgage Rate: With respect to each Adjustable Rate
Mortgage
Loan, the maximum rate of interest set
forth as such in the related Mortgage
Note and with respect to each Fixed Rate
Mortgage Loan, the rate of interest set
forth in the related Mortgage Note.
Maximum Rate Cap: Any of the Class A-1 Maximum Rate Cap, the Class
A-2
Maximum Rate Cap or the Subordinated
Certificate Maximum Rate Cap.
MERS: Mortgage Electronic Registration Systems, Inc., a
corporation
organized and existing under the laws of
the State of Delaware, or any successor
thereto.
MERS Loan: Any Mortgage Loan registered with MERS on the MERS
System.
MERS System: The system of recording transfers of mortgage
electronically maintained by MERS.
MGIC:
Mortgage Guaranty Insurance Corporation, a Wisconsin insurance
corporation, or its successor in
interest.
MI Insurer Fee: The amount payable to the related MI Insurer on
each
Distribution Date, which amount shall equal
one-twelfth of the product of (i)
the related MI Insurer Fee Rate and (ii)
the Stated Principal Balance of the
applicable MI Mortgage Loan (or the related
REO Property) as of the first day of
the related Due Period.
MI Insurer Fee Rate: With respect to each MI Mortgage Loan, the
rate
specified for such Mortgage Loan on the
schedule attached to the related MI
Policy, plus a rate computed so that the
related MI Insurer Fee would make the
related MI Insurer whole for any taxes
imposed on such MI Insurer by the States
of [Kentucky or West Virginia] with respect
to MI Mortgage Loans located in such
States, which rate shall be provided to the
Trustee by the applicable MI
Insurer.
MI Insurers: PMI and
MGIC.
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MI Mortgage Loans: The list of Mortgage Loans insured by the MI
Insurers attached hereto as Exhibit
B-4.
MI Policies: (A) The PMI Bulk Primary MI Policy # 22510-0003-0 and
all
endorsements thereto, with an effective
date of March 1, 2005, with respect to
the MI Mortgage Loans insured by PMI, which
is attached hereto as Exhibit Q-1
and (B) the MGIC Mortgage Guaranty Master
Policy for Multiple Loan Transactions
# 22-400-4-3203 and the related Terms
Letter and all endorsements thereto, with
an effective date of March 1, 2005, with
respect to the MI Mortgage Loans
insured by MGIC, which is attached hereto
as Exhibit Q-2.
MIN: The loan number
for any MERS Loan.
Minimum Mortgage Rate: With respect to each Adjustable Rate
Mortgage
Loan, the minimum rate of interest set
forth as such in the related Mortgage
Note.
Minimum Required Overcollateralization Amount: An amount equal to
the
product of (x) 0.50% and (y) the Stated
Principal Balance of the Mortgage Loans
as of the Cut-off Date.
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 Excess Interest Amount: With respect to each Distribution
Date,
the amount, if any, by which the Interest
Funds for such Distribution Date
exceeds the aggregate amount distributed on
such Distribution Date pursuant to
Section 4.04(b) (other than the last clause
thereof).
Monthly Statement: The statement delivered to the
Certificateholders
pursuant to Section 4.05.
Moody's: Moody's
Investors Service, Inc. or any successor in interest.
Mortgage: With respect to a Mortgage Loan that is not a Co-op Loan,
the
mortgage, deed of trust or other instrument
with all riders attached thereto
creating a first or second lien or a first
or second priority ownership interest
in an estate in fee simple in real property
securing a Mortgage Note. With
respect to a Co-op Loan, the security
agreement with all riders attached thereto
creating a security interest in the stock
allocated to a dwelling unit in a
residential cooperative housing corporation
and pledged to secure such Co-op
Loan and the related Co-op Lease.
Mortgage File: The mortgage documents listed in Section 2.01
hereof
pertaining to a particular Mortgage Loan
and any additional documents delivered
to the Trustee to be added to the Mortgage
File pursuant to this Agreement.
Mortgage Group: Either
of Group One or Group Two.
Mortgage Loans: Such of the mortgage loans transferred and assigned
to
the Trustee pursuant to the provisions
hereof as from time to time are held as a
part of the Trust Fund (including any REO
Properties), the mortgage loans so
held being identified in the Mortgage Loan
Schedule, notwithstanding foreclosure
or other acquisition of title of the
related Mortgaged Property. Any mortgage
loan that was intended by the parties
hereto to be transferred to the Trust Fund
as indicated by such Mortgage Loan Schedule
which is in fact not so transferred
for any reason shall continue to be a
Mortgage Loan hereunder until the Purchase
Price with respect thereto has been paid to
the Trust Fund.
Mortgage Loan Schedule: The lists of Mortgage Loans (as from time
to
time amended by the Trustee to reflect the
deletion of Deleted Mortgage Loans
and the addition of Replacement
Mortgage
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<PAGE>
Loans pursuant to the provisions of this
Agreement) transferred to the Trustee
as part of the Trust Fund and from time to
time subject to this Agreement,
attached hereto as Exhibits B-1, B-2, B-3
and B-4, setting forth the following
information with respect to each Mortgage
Loan:
(i) the loan
number;
(ii)
the
borrower name and address;
(iii) the
unpaid principal balance of the Mortgage Loans;
(iv)
the Initial Mortgage Rate;
(v) the
original maturity date and the months remaining before
maturity date;
(vi)
the original principal balance;
(vii) the
Cut-off Date Principal Balance;
(viii) the first
payment due date of the Mortgage Loan;
(ix)
the Loan-to-Value Ratio at origination with respect to a first
lien Mortgage Loan, or the Combined Loan-to-Value Ratio with
respect to a second lien Mortgage Loan;
(x) a code
indicating whether the residential dwelling at the time
of origination was represented to be owner-occupied;
(xi)
a code indicating the property type;
(xii) with
respect to each Adjustable Rate Mortgage Loan;
(A) the
frequency of each Adjustment Date;
(B)
the next
Adjustment Date;
(C) the
Maximum Mortgage Rate;
(D) the
Minimum Mortgage Rate;
(E) the
Mortgage Rate as of the Cut-off Date;
(F) the
related Periodic Rate Cap;
(G) the Gross
Margin;
(H) the
lifetime rate cap;
(xiii) location of the related Mortgaged Property (or
Underlying
Mortgaged
Property, in the case of a Co-op Loan);
(xiv) a
code indicating whether a Prepayment Charge is applicable and,
if so the
term of such Prepayment Charge;
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<PAGE>
(xv)
the Credit Score and date obtained;
(xvi)
the
MIN;
(xvii) a code
indicating whether such loan is an MI Mortgage
Loan;
(xviii) each MI
Insurer Fee Rate; and
(xix) the
coverage percentage under the applicable MI
Policy.
Mortgage Note: The original executed note or other evidence of
indebtedness evidencing the indebtedness of
a Mortgagor under a Mortgage Loan
and all amendments, modifications and
attachments thereto with all riders
attached thereto.
Mortgage Pool: The aggregate of the Mortgage Loans identified in
the
Mortgage Loan Schedule.
Mortgaged Property: The underlying property securing a Mortgage
Loan.
Mortgage Rate: The annual rate of interest borne by a Mortgage
Note
from time to time.
Mortgagor: The obligor
on a Mortgage Note.
Net Mortgage Rate: As to each Mortgage Loan, and at any time, the
per
annum rate equal to the then current
Mortgage Rate less the sum of (1) the
Servicing Fee Rate and (2) the MI Insurer
Fee Rate, if applicable.
Net Rate: With respect to any Distribution Date, the product of (x)
the
weighted average Net Mortgage Rate for the
Mortgage Loans calculated based on
the respective Net Mortgage Rates and the
Stated Principal Balances of such
Mortgage Loans as of the preceding
Distribution Date (or, in the case of the
first Distribution Date, as of the Cut-off
Date) and (y) a fraction, the
numerator of which is 30 and the
denominator of which is the actual number of
days in the related Accrual Period.
Net WAC: With respect to any Distribution Date and any Mortgage
Group,
a per annum rate equal to 12 times the
quotient obtained by dividing (x) the
total scheduled interest on the Mortgage
Loans in such Mortgage Group based on
the Net Mortgage Rates in effect on the
related Due Date by (y) the aggregate
Stated Principal Balance of the Mortgage
Loans in such Mortgage Group as of the
preceding Distribution Date (or, in the
case of the first Distribution Date, as
of the Cut-off Date).
NIM Notes: The notes
to be issued pursuant to the Indenture.
NIMs Insurer: Any of the one or more insurers, if any, that is
guaranteeing certain payments under any NIM
Notes; provided, that upon the
payment in full of the NIM Notes, all
rights of the NIMs Insurer hereunder shall
terminate.
NIMs Insurer Default:
As defined in Section 10.12.
Non-Recoverable Advance: Any portion of an Advance previously made
or
proposed to be made by the Servicer that,
in the good faith judgment of the
Servicer, will not or, in the case of a
current delinquency, would not, be
ultimately recoverable by the Servicer from
the related Mortgagor, related
Liquidation Proceeds or otherwise with
respect to the related Mortgage Loan.
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<PAGE>
Non-Recoverable Servicing Advance: Any portion of a Servicing
Advance
previously made or proposed to be made by
the Servicer that, in the good faith
judgment of the Servicer, will not or, in
the case of a current Servicing
Advance, would not, be ultimately
recoverable by the Servicer from the related
Mortgagor, related Liquidation Proceeds or
otherwise with respect to the related
Mortgage Loan.
Non-Supported Interest Shortfall: As defined in Section 4.02.
Offered Certificates: The Class A-1, Class A-2, Class M, Class
B-1,
Class B-2, Class B-3 and Class R
Certificates.
Officer's Certificate: A certificate (1) signed by the Chairman of
the
Board, the Vice Chairman of the Board, the
President, 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 or the
Servicer (or any other officer 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 a
particular subject) or (2), if provided for
in this Agreement, signed by a Servicing
Officer, as the case may be, and
delivered to the Depositor, the Servicer or
the Trustee, as the case may be, as
required by this Agreement.
One-Month LIBOR: With respect to any Accrual Period, the rate
determined by the Trustee on the related
Interest Determination Date on the
basis of (a) the offered rates for
one-month United States dollar deposits, as
such rates appear on Telerate page 3750, as
of 11:00 a.m. (London time) on such
Interest Determination Date or (b) if such
rate does not appear on Telerate Page
3750 as of 11:00 a.m. (London time), the
offered rates of the Reference Banks
for one-month United States dollar
deposits, as such rates appear on the Reuters
Screen LIBO Page, as of 11:00 a.m. (London
time) on such Interest Determination
Date. If One-Month LIBOR is determined
pursuant to clause (b) above, on each
Interest Determination Date, One-Month
LIBOR for the related Accrual Period will
be established by the Trustee as
follows:
(i) If on such
Interest Determination Date two or more
Reference Banks provide such offered quotations,
One-Month LIBOR for the related Accrual Period shall
be the arithmetic mean of such offered quotations
(rounded upwards if necessary to the nearest whole
multiple of 0.03125%).
(ii)
If on such Interest Determination Date fewer than two
Reference Banks provide such offered quotations,
One-Month LIBOR for the related Accrual Period shall
be the higher of (i) One-Month LIBOR as determined on
the previous Interest Determination Date and (ii) the
Reserve Interest Rate.
Opinion of Counsel: A written opinion of counsel, who may be
counsel
for the Depositor or the Servicer,
reasonably acceptable to each addressee of
such opinion; provided, however, that with
respect to Section 6.04 or 10.01, or
the interpretation or application of the
REMIC Provisions, such counsel must (1)
in fact be independent of the Depositor and
the Servicer, (2) not have any
direct financial interest in the Depositor
or the Servicer or in any affiliate
of any such party and (3) not be connected
with the Depositor or the Servicer as
an officer, employee, promoter,
underwriter, trustee, partner, director or
person performing similar functions.
Optional Termination: The termination of the Trust Fund
hereunder
pursuant to Section 9.01(a) hereof.
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<PAGE>
Optional Termination Amount: The amount received by the Trustee
in
connection with any purchase of all of the
Mortgage Loans and REO Properties
pursuant to Section 9.01(b) hereof.
Optional Termination Price: On any date after the Initial
Optional
Termination Date, an amount equal to the
sum of (A) the aggregate Stated
Principal Balance of each Mortgage Loan
(other than any Mortgage Loan that has
become an REO Property) as of the
Distribution Date on which the proceeds of the
Optional Termination are distributed to the
Certificateholders, plus accrued
interest thereon at the applicable Mortgage
Rate as of the Due Date preceding
the Distribution Date on which the proceeds
of the Optional Termination are
distributed to Certificateholders and the
fair market value of any REO Property,
plus accrued interest thereon as of the
Distribution Date on which the proceeds
of the Optional Termination are distributed
to Certificateholders, (B) any
unreimbursed out-of-pocket costs and
expenses owed to the Trustee (including any
reasonable fees and expenses incurred by
the Trustee in connection with
conducting the Auction) or the Servicer and
any unpaid or unreimbursed Servicing
Fees, Advances and Servicing Advances and
(C) any unreimbursed costs, penalties
and/or damages incurred by the Trust Fund
in connection with any violation
relating to any of the Mortgage Loans of
any predatory or abusive lending law.
OTS: The Office of
Thrift Supervision.
Outstanding: With respect to the Certificates as of any date of
determination, all Certificates theretofore
executed and authenticated under
this Agreement except: (1) Certificates
theretofore canceled by the Trustee or
delivered to the Trustee for cancellation;
and (2) Certificates in exchange for
which or in lieu of which other
Certificates have been executed by the Trustee
and delivered by the Trustee pursuant to
this Agreement.
Outstanding Mortgage Loan: As of any Distribution Date, a Mortgage
Loan
with a Stated Principal Balance greater
than zero that was not the subject of a
Principal Prepayment in full, and that did
not become a Liquidated Loan, prior
to the end of the related Due Period.
Overcollateralization Amount: As of any date of determination,
the
excess of (1) the Stated Principal Balance
of the Mortgage Loans over (2) the
Certificate Principal Balance of the
Certificates (other than the Class P
Certificates and the Class C
Certificates).
Ownership Interest: As to any 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.
Pass-Through Rate: With respect to any Class of Certificates,
the
corresponding Pass-Through Rate for such
Class of Certificates.
Percentage Interest:
With respect to:
(i) any Class,
the percentage interest in the undivided
beneficial ownership interest evidenced by such Class
which shall be equal to the Certificate Principal
Balance of such Class divided by the aggregate
Certificate Principal Balance of all Classes; and
(ii)
any Certificate, the Percentage Interest evidenced
thereby of the related Class shall equal the
percentage obtained by dividing the Denomination of
such Certificate by the aggregate of the
Denominations of all Certificates of such
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<PAGE>
Class; except that in the case of any Class P
Certificates, the Percentage Interest with respect to
such Certificate shown on the face of such
Certificate.
Periodic Rate Cap: As to each Adjustable Rate Mortgage Loan and
the
related Mortgage Note, the provision
therein that limits permissible increases
and decreases in the Mortgage Rate on any
Adjustment Date.
Permitted Activities: The primary activities of the Trust Fund
created
pursuant to this Agreement which shall
be:
(i) holding
Mortgage Loans transferred from the Depositor
and other assets of the Trust Fund, including the Cap
Contracts and any credit enhancement and passive
derivative financial instruments that pertain to
beneficial interests issued or sold to parties other
than the Depositor, its Affiliates, or its agents;
(ii)
issuing Certificates and other interests in the
assets of
the Trust Fund;
(iii)
receiving collections on the Mortgage Loans and the
Cap Contracts and making payments on such
Certificates and interests in accordance with the
terms of this Agreement; and
(iv)
engaging in other activities that are necessary or
incidental to accomplish these limited purposes,
which activities cannot be contrary to the status of
the Trust Fund as a qualified special purpose entity
under existing accounting literature.
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 rating the Certificates;
(iii)
commercial or finance company paper, other than
commercial or finance company paper issued by the
Depositor, the Trustee or any of its Affiliates,
which is then receiving the highest commercial or
finance company paper rating of each such Rating
Agency;
(iv)
certificates of deposit, demand or time deposits, or
bankers' acceptances (other than bankers' acceptances
issued by the Trustee or any of its Affiliates)
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 are then
rated one of the two highest long-term and the
highest short-term ratings of each such Rating Agency
for such securities;
(v) demand or
time deposits or certificates of deposit
issued by any bank or trust company or savings
institution to the extent that such deposits are
fully insured by the FDIC;
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<PAGE>
(vi)
guaranteed reinvestment agreements issued by any
bank, insurance company or other corporation rated in
the two highest long-term or the highest short-term
ratings of
each Rating Agency containing, at the time
of the issuance of such agreements, such terms and
conditions as will not result in the downgrading or
withdrawal of the rating then assigned to the
Certificates by any such Rating Agency as evidenced
by a letter from each Rating Agency;
(vii)
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 (v)
above;
(viii)
securities (other than stripped bonds, stripped
coupons or instruments sold at a purchase price in
excess of 115% of the face amount thereof) bearing
interest or sold at a discount issued by any
corporation, other than the Trustee or any of its
Affiliates, incorporated under the laws of the United
States or any state thereof which, at the time of
such investment, have one of the two highest long
term ratings of each Rating Agency;
(ix)
interests in any money market fund (including those
managed or advised by the Trustee or its affiliates)
which at the date of acquisition of the interests in
such fund and throughout the time such interests are
held in such fund has the highest applicable long
term rating by each Rating Agency rating such fund;
and
(x) short term
investment funds sponsored by any trust
company or national banking association incorporated
under the laws of the United States or any state
thereof, other than the Trustee or any of its
Affiliates, which on the date of acquisition has been
rated by each such Rating Agency in their respective
highest applicable rating category;
provided, that no such instrument shall be
a Permitted Investment if such
instrument (i) evidences the right to
receive interest only payments with
respect to the obligations underlying such
instrument, (ii) is purchased at a
premium or above par or (iii) is purchased
at a deep discount; provided,
further, that no such instrument shall be a
Permitted Investment (A) if such
instrument evidences principal and interest
payments derived from obligations
underlying such instrument and the interest
payments with respect to such
instrument provide a yield to maturity of
greater than 120% of the yield to
maturity at par of such underlying
obligations, or (B) if it may be redeemed at
a price below the purchase price (the
foregoing clause (B) not to apply to
investments in units of money market funds
pursuant to clause (ix) above); and
provided, further, (I) that no amount
beneficially owned by any REMIC
(including, without limitation, any amounts
collected by the Servicer but not
yet deposited in the Collection Account)
may be invested in investments (other
than money market funds) treated as equity
interests for Federal income tax
purposes, unless the Servicer and/or the
Trustee shall receive an Opinion of
Counsel acceptable to the Servicer and/or
the Trustee, at the expense of the
party requesting that such investment be
made, to the effect that such
investment will not adversely affect the
status of the any REMIC provided for
herein as a REMIC under the Code or result
in imposition of a tax on the Trust
Fund or any REMIC provided for herein and
(II) each such investment must be a
"permitted investment" within the meaning
of Section 860G(a)(5) of the Code.
Permitted Investments that are subject to
prepayment or call may not be
purchased at a price in excess of par.
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
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<PAGE>
organization (except certain farmers'
cooperatives described in Section 521 of
the Code) that 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 the Class R Certificate, (iv)
rural electric and telephone
cooperatives described in Section
1381(a)(2)(C) of the Code, and (v) a Person
that is not a citizen or resident of the
United States, a corporation or
partnership (or other entity treated as a
corporation or partnership for United
States federal income tax purposes) created
or organized in or under the laws of
the United States or any State thereof or
the District of Columbia or an estate
whose income from sources without the
United States is includable 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 authority to control all
substantial decisions of the trust,
unless, in the case of this clause (v),
such Person has furnished the transferor
and the Trustee with a duly completed
Internal Revenue Service Form W-8ECI or
applicable successor form. The terms
"United States," "State" and "International
Organization" shall have the meanings set
forth in Section 7701 of the Code. A
corporation will not be treated as an
instrumentality of the United States or of
any State 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, limited
liability
company, joint venture, association,
joint-stock company, trust, unincorporated
organization or government, or any agency
or political subdivision thereof.
PMI: PMI Mortgage Insurance Co., an Arizona insurance corporation,
or
its successor in interest.
Pool Stated Principal Balance: As to any Distribution Date, the
aggregate of the Stated Principal Balances,
as of such Distribution Date, of the
Mortgage Loans that were Outstanding
Mortgage Loans as of such date.
Preference Claim: The
meaning set forth in Section 4.04(j) hereof.
Prepayment Assumption: A rate or rates of prepayment, as described
in
the Prospectus Supplement in the definition
of "Modeling Assumptions," relating
to the Offered Certificates.
Prepayment Charges: Any prepayment premium, fee or charge payable
by a
Mortgagor in connection with any Principal
Prepayment on a Mortgage Loan
pursuant to the terms of the related
Mortgage Note or Mortgage, as applicable,
as identified on the Mortgage Loan
Schedule.
Prepayment Interest Excess: With respect to any Servicer
Remittance
Date, for each Mortgage Loan that was the
subject of a partial Principal
Prepayment or a Principal Prepayment in
full during the portion of the related
Prepayment Period occurring between the
first day of the calendar month in which
such Servicer Remittance Date occurs and
the last day of the related Prepayment
Period, an amount equal to interest (to the
extent received) at the applicable
Net Mortgage Rate on the amount of such
Principal Prepayment for the number of
days commencing on the first day of the
calendar month in which such Servicer
Remittance Date occurs and ending on the
date on which such Principal Prepayment
is so applied.
Prepayment Interest Shortfall: With respect to any Distribution
Date,
for each Mortgage Loan that was the subject
of a Principal Prepayment in full
(other than a Principal Prepayment in full
resulting from the purchase of a
Mortgage Loan pursuant to Section 2.02,
2.03 or 9.01 hereof), the amount, if
any, by which (i) one month's interest at
the applicable Net Mortgage Rate on
the Stated Principal Balance of
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<PAGE>
such Mortgage Loan as of the preceding
Distribution Date or in the case of a
partial Principal Prepayment, on the amount
of such prepayment, exceeds (ii) the
amount of interest paid or collected in
connection with such Principal
Prepayment.
Prepayment Period: As to any Distribution Date, the period
beginning
with the opening of business on the 15th
day of the calendar month preceding the
month in which such Distribution Date
occurs (or in the case of the first
Distribution Date, beginning with the
opening of business on the Cut-off Date)
and ending on the close of business on the
14th day of the month in which such
Distribution Date occurs.
Principal Distribution Amount: With respect to each Distribution
Date,
the sum of (i) the Principal Funds for such
Distribution Date and (ii) any Extra
Principal Distribution Amount for such
Distribution Date.
Principal Funds: With respect to the Mortgage Loans and any
Distribution Date, the sum, without
duplication, of (1) all scheduled principal
due during the related Due Period and
received before the related Servicer
Remittance Date or advanced on or before
the related Servicer Remittance Date,
(2) all Principal Prepayments collected in
the related Prepayment Period, (3)
the Stated Principal Balance of each
Mortgage Loan that was purchased by the
Depositor or the Servicer during the
related Prepayment Period or, in the case
of a purchase pursuant to Section 9.01, on
any Business Day prior to such
Distribution Date, (4) the amount, if any,
by which the aggregate unpaid
principal balance of any Replacement
Mortgage Loan is less than the aggregate
unpaid principal of the related Deleted
Mortgage Loans delivered by the Seller
in connection with a substitution of a
Mortgage Loan pursuant to Section
2.03(c), (5) all Liquidation Proceeds
collected during the related Prepayment
Period (to the extent such Liquidation
Proceeds related to principal), (6) all
Subsequent Recoveries received during the
related Due Period and (7) all other
collections and recoveries in respect of
principal during the related Prepayment
Period less (A) all Non-Recoverable
Advances relating to principal with respect
to the Mortgage Loans and (B) all other
amounts reimbursable to the Servicer and
the Trustee pursuant to this Agreement and
allocable to principal.
Principal Prepayment: Any Mortgagor payment or other recovery of
(or
proceeds with respect to) principal on a
Mortgage Loan (including Mortgage Loans
purchased or repurchased under Sections
2.02, 2.03 and 9.01 hereof) that is
received or recovered in advance of its
scheduled Due Date and is not
accompanied by an amount as to interest
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 Servicer in accordance
with the terms of the related Mortgage
Note.
Prospectus Supplement: The Prospectus Supplement dated April 19,
2005
relating to the public offering of the
Offered Certificates.
PUD: A Planned Unit
Development.
Purchase Price: With respect to any Mortgage Loan required to
be
repurchased by the Seller or the applicable
Transferor pursuant to Section 2.02
or 2.03 hereof, an amount equal to the sum
of (i) 100% of the unpaid principal
balance of the Mortgage Loan as of the date
of such purchase together with any
related unreimbursed Servicing Advances,
(ii) accrued interest thereon at the
applicable Mortgage Rate from (a) the date
through which interest was last paid
by the Mortgagor to (b) the Due Date in the
month in which the Purchase Price is
to be distributed to Certificateholders and
(iii) any unreimbursed costs,
penalties and/or damages incurred by the
Trust Fund (or the Trustee on behalf of
the Trust Fund) in connection with any
violation relating to such Mortgage Loan
of any predatory or abusive lending
law.
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<PAGE>
Rating Agency: Any of Fitch, S&P or Moody's. If any such
organization
or its successor is no longer in existence,
"Rating Agency" shall be a
nationally recognized statistical rating
organization, or other comparable
Person, designated by the Depositor, notice
of which designation shall be given
to the Trustee. References herein to a
given rating category of a Rating Agency
shall mean such rating category without
giving effect to any modifiers.
Realized Loss: With respect to (1) a Liquidated Loan, the amount,
if
any, by which the Stated Principal Balance
and accrued interest thereon at the
Net Mortgage Rate exceeds the amount
actually recovered by the Servicer with
respect thereto (net of reimbursement of
Advances and Servicing Advances) at the
time such Mortgage Loan became a Liquidated
Loan or (2) a Mortgage Loan which is
not a Liquidated Loan, any amount of
principal that the Mortgagor is no longer
legally required to pay (except for the
extinguishment of debt that results from
the exercise of remedies due to default by
the Mortgagor).
Record Date: With respect to any Distribution Date, the close
of
business on the last Business Day of the
month preceding the month in which the
applicable Distribution Date occurs (or, in
the case of the first Distribution
Date, the Closing Date).
Reference Banks: Barclays Bank PLC, JPMorgan Chase Bank, N.A.,
Citibank, N.A., Wells Fargo Bank, N.A. and
NatWest, N.A.; provided that if any
of the foregoing banks are not suitable to
serve as a Reference Bank, then any
leading banks selected by the Trustee with
the consent of the NIMs Insurer which
are engaged in transactions in Eurodollar
deposits in the international
Eurocurrency market (i) with an established
place of business in London, England
and (ii) whose quotations appear on the
Reuters Screen LIBO Page on the relevant
Interest Determination Date and (iii) which
have been designated as such by the
Servicer.
Regular Certificate: Any one of the Class A, Class M, and Class
B
Certificates.
Relief Act: The Servicemembers Civil Relief Act or any similar
state or
local law.
Relief Act Shortfall: With respect to any Distribution Date and
any
Mortgage Loan, any reduction in the amount
of interest or principal collectible
on such Mortgage Loan for the most recently
ended calendar month as a result of
the application of the Relief Act.
REMIC: A "real estate mortgage investment conduit" within the
meaning
of section 860D of the Code. References
herein to "the REMICs" or "a REMIC"
shall mean any of (or, as the context
requires, all of) the Lower Tier REMIC and
the Upper Tier REMIC.
REMIC Pass-Through Rate: The Class A-1 Available Funds Cap (in the
case
of a Class included in Certificate Group
One), the Class A-2 Available Funds Cap
(in the case of a Class included in
Certificate Group Two) or the Subordinated
Certificate Available Funds Cap (in the
case of the Subordinated Certificates).
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
proposed, temporary and final regulations
and published rulings, notices and
announcements promulgated thereunder, as
the foregoing may be in effect from
time to time as well as provisions of
applicable state laws.
- 40 -
<PAGE>
REMIC Regular Interests: (i) any of the rights under any of the
Certificates (other than the Class P
Certificates, the Class R Certificate and
the Class C Certificates) other than the
rights in interest rate cap contracts
described in Section 2.07 and (ii) the
Uncertificated Class C Interest.
Remittance Report: As
defined in Section 4.04(j) hereof.
REO Property: A Mortgaged Property acquired by the Servicer, on
behalf
of the Trustee for the benefit of the
Certificateholders, through foreclosure or
deed-in-lieu of foreclosure in connection
with a defaulted Mortgage Loan.
Replacement Mortgage Loan: A Mortgage Loan substituted by the
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 I (1)
have a Stated Principal Balance, after
deduction of the principal portion of the
Scheduled Payment due in the month of
substitution, not in excess of, and not
less than 90% of the Stated Principal
Balance of the Deleted Mortgage Loan; (2)
with respect to any Fixed Rate Mortgage
Loan, have a Mortgage Rate not less than
or no more than 1% per annum higher than
the Mortgage Rate of the Deleted
Mortgage Loan and, with respect to any
Adjustable Rate Mortgage Loan: (A) have a
Maximum Mortgage Rate no more than 1% per
annum higher or lower than the Maximum
Mortgage Rate of the Deleted Mortgage Loan;
(B) have a Minimum Mortgage Rate no
more than 1% per annum higher or lower than
the Minimum Mortgage Rate of the
Deleted Mortgage Loan; (C) have the same
index and Periodic Rate Cap as that of
the Deleted Mortgage Loan and a Gross
Margin not more than 1% per annum higher
or lower than that of the Deleted Mortgage
Loan; (D) not permit conversion of
the related Mortgage Rate to a fixed
Mortgage Rate and (F) currently be accruing
interest at a rate not more than 1% per
annum higher or lower than that of the
Deleted Mortgage Loan; (3) have a similar
or higher FICO score or credit grade
than that of the Deleted Mortgage Loan; (4)
have a Loan-to-Value Ratio (or
Combined Loan-to-Value Ratio, in the case
of the Mortgage Loans in a second lien
position) no higher than that of the
Deleted Mortgage Loan; (5) have a remaining
term to maturity no greater than (and not
more than one year less than) that of
the Deleted Mortgage Loan; (6) provide for
a Prepayment Charge on terms
substantially similar to those of the
Prepayment Charge, if any, of the Deleted
Mortgage Loan; (7) have the same lien
priority as the Deleted Mortgage Loan; (8)
constitute the same occupancy type as the
Deleted Mortgage Loan; (9) be covered
by the applicable MI Policy if such Deleted
Mortgage Loan was covered by such MI
Policy; and (10) comply with each
representation and warranty set forth in
Section 2.03 hereof.
Request for Release: The Request for Release of Documents submitted
by
the Servicer to the Trustee, substantially
in the form of Exhibit I hereto.
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 including, without limitation, in
case of any MI Mortgage Loan, the
applicable MI Policy.
Required Percentage: As of any Distribution Date, the quotient of
(1)
the excess of (A) the Stated Principal
Balances of the Mortgage Loans as of such
Distribution Date, over (B) the Certificate
Principal Balance of the most senior
Class of Certificates outstanding as of
such Distribution Date, prior to giving
effect to distributions to be made on such
Distribution Date and (2) the Stated
Principal Balance of the Mortgage Loans as
of such Distribution Date. As used
herein, on any Distribution Date when any
of the Class A Certificates are
outstanding, the Certificate Principal
Balance of the most senior Class of
Certificates will equal the aggregate
Certificate Principal Balance of the Class
A Certificates as of such date of
calculation.
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<PAGE>
Reserve Interest Rate: With respect to any Interest Determination
Date,
the rate per annum that the Trustee
determines to be (1) the arithmetic mean
(rounded upwards if necessary to the
nearest whole multiple of 0.03125%) of the
one-month United States dollar lending
rates which New York City banks selected
by the Trustee are quoting on the relevant
Interest Determination Date to the
principal London offices of leading banks
in the London interbank market or (2)
in the event that the Trustee can determine
no such arithmetic mean, the lowest
one-month United States dollar lending rate
which New York City banks selected
by the Trustee are quoting on such Interest
Determination Date to leading
European banks.
Residual Excess Interest Amount: With respect to any Distribution
Date,
the excess of (x) 0.05% of the Monthly
Excess Interest Amount for such
Distribution Date and all prior
Distribution Dates over (y) all payments
previously made to the Class R Certificate
in respect of the Residual Excess
Interest Amount.
Residual Interest: An interest in the Upper Tier REMIC that is
entitled
to all distributions of principal and
interest on the Class R Certificate other
than distributions in respect of the Class
LTR Interest and distributions on the
Class R Certificate in respect of Excess
Interest.
Responsible Officer: When used with respect to the Trustee or
the
Servicer, any officer of the Trustee or the
Servicer with direct responsibility
for the administration of this Agreement
and also means any other officer 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.
Reuters Screen LIBO Page: The display designated as page "LIBO" on
the
Reuters Monitor Money Rates Service (or
such other page as may replace such LIBO
page on that service for the purpose of
displaying London interbank offered
rates of major banks.
S&P: Standard & Poor's, a division of The McGraw-Hill
Companies, Inc.,
or any successor in interest.
Sale Agreement: The Mortgage Loan Sale and Assignment Agreement
dated
as of March 1, 2005 between the Depositor
and the Seller.
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.
Section 302 Requirements: Any rules or regulations promulgated
pursuant
to the Sarbanes-Oxley Act of 2002 (as such
may be amended from time to time).
Securities Act: The
Securities Act of 1933, as amended.
Seller: Merrill Lynch Mortgage Capital, Inc., a Delaware
corporation,
or its successors in interest.
Servicer: Wilshire Credit Corporation, a Nevada corporation, or
its
successor in interest.
Servicer Advance Date: As to any Distribution Date, the related
Servicer Remittance Date.
Servicer Remittance Date: With respect to any Distribution Date,
the
later of two Business Days after the 15th
day of the month in which such
Distribution Date occurs and the 18th day
(or if such day is not a Business Day,
the next succeeding Business Day) of the
month in which such Distribution Date
occurs.
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<PAGE>
Servicing Advances: All customary, reasonable and necessary "out
of
pocket" costs and expenses incurred in the
performance of the Servicer's
servicing obligations hereunder, including,
but not limited to, the cost of (1)
the preservation, inspection, restoration
and protection of a Mortgaged Property
(or Underlying Mortgaged Property, in the
case of a Co-op Loan), including
without limitation advances in respect of
real estate taxes and assessments, (2)
any collection, enforcement or judicial
proceedings, including without
limitation foreclosures, collections and
liquidations, (3) the conservation,
management, sale and liquidation of any REO
Property, (4) executing and
recording instruments of satisfaction,
deeds of reconveyance or Assignments of
Mortgage to the extent not otherwise
recovered from the related Mortgages or
payable under this Agreement, (5)
correcting errors of prior servicers; costs
and expenses charged to the Servicer by the
Trustee; tax tracking; title
research; flood certifications; lender paid
mortgage insurance, (6) obtaining or
correcting any legal documentation required
to be included in the Mortgage Files
and reasonably necessary for the Servicer
to perform its obligations under this
Agreement and (7) compliance with the
obligations under Sections 3.01 and 3.10;
provided that such amounts are required to
be advanced only to the extent such
advances constitute "unanticipated
expenses" within the meaning of Treasury
Regulation Section 1.860G-1(b)(3)(ii).
Servicing Fee: As to each Mortgage Loan and any Distribution Date,
an
amount equal to the product of (x)
one-twelfth of the Servicing Fee Rate and (y)
the Stated Principal Balance of such
Mortgage Loan as of the preceding
Distribution Date or, in the event of any
payment of interest that accompanies a
Principal Prepayment in full made by the
Mortgagor, interest at the Servicing
Fee Rate on the Stated Principal Balance of
such Mortgage Loan as of the
preceding Distribution Date for the period
covered by such payment of interest.
Servicing Fee Rate:
0.50% per annum.
Servicing Officer: Any officer of the 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 Servicer on the Closing
Date pursuant to this Agreement, as
such lists may from time to time be
amended.
Servicing Transfer Costs: All costs associated with the transfer
of
servicing from the predecessor Servicer,
including, without limitation, any
costs or expenses associated with the
termination of the predecessor Servicer,
the appointment of a successor servicer,
the complete transfer of all servicing
data and the completion, correction or
manipulation of such servicing data as
may be required by the Trustee or any
successor servicer to correct any errors
or insufficiencies in the servicing data or
otherwise to enable the Trustee or
successor servicer to service the Mortgage
Loans properly and effectively.
SFAS 140: Statement of Financial Accounting Standard No. 140,
Accounting for Transfers and Servicing of
Financial Assets and Extinguishments
of Liabilities dated September 2000,
published by the Financial Accounting
Standards Board of the Financial Accounting
Foundation.
Startup Day: As
defined in Section 2.07 hereof.
Stated Principal Balance: With respect to any Mortgage Loan or
related
REO Property (1) as of the Cut-off Date,
the Cut-off Date Principal Balance
thereof, and (2) as of any Distribution
Date, such Cut-off Date Principal
Balance, minus the sum of (A) the principal
portion of the Scheduled Payments
(x) due with respect to such Mortgage Loan
during each Due Period ending prior
to such Distribution Date and (y) that were
received by the Servicer as of the
close of business on the Determination Date
related to such Distribution Date or
with respect to which Advances were made on
the Servicer Advance Date prior to
such Distribution Date and (B) all
Principal Prepayments with respect to such
Mortgage Loan received on or prior to the
last day of the related Prepayment
Period, and all Liquidation Proceeds to the
extent
- 43 -
<PAGE>
applied by the Servicer as recoveries of
principal in accordance with Section
3.12 with respect to such Mortgage Loan,
that were received by the Servicer as
of the close of business on the last day of
the related Due Period.
Notwithstanding the foregoing, the Stated
Principal Balance of a Liquidated Loan
shall be deemed to be zero.
Stepdown Date: The later to occur of (1) the Distribution Date in
April
2008 or (2) the first Distribution Date on
which (A) the Class A Certificate
Principal Balance (reduced by the Principal
Funds with respect to such
Distribution Date) is less than or equal to
(B) 73.90% of the Stated Principal
Balances of the Mortgage Loans as of such
Distribution Date.
Stepdown Required Loss Percentage: For any Distribution Date,
the
applicable percentage for such Distribution
Date set forth in the following
table:
<TABLE>
<CAPTION>
DISTRIBUTION DATE OCCURRING IN
STEPDOWN REQUIRED LOSS
------------------------------
----------------------
PERCENTAGE
----------
<S>
<C>
April 2008 - March 2009
1.50% with respect to April 2008, plus
an additional 1/12th of 0.50% for each
month thereafter
April 2009 - March 2010
2.00% with respect to April 2009, plus
an additional 1/12th of 0.75% for each
month thereafter
April 2010 - March 2011
2.75% with respect to April 2010, plus
an additional 1/12th of 0.25% for each
month thereafter
April 2011 and thereafter
3.00%
</TABLE>
Stepdown Trigger Event: With respect to the Certificates on or
after
the Stepdown Date, a Distribution Date on
which (1) the quotient of (A) the
aggregate Stated Principal Balance of all
Mortgage Loans which are 60 or more
days Delinquent measured on a rolling three
month basis (including, for the
purposes of this calculation, Mortgage
Loans in foreclosure and REO Properties
and Mortgage Loans with respect to which
the applicable Mortgagor is in
bankruptcy) and (B) the Stated Principal
Balance of the Mortgage Loans as of the
preceding Servicer Remittance Date, equals
or exceeds the product of (i) 40.00%
and (ii) the Required Percentage or (2) the
quotient (expressed as a percentage)
of (A) the aggregate Realized Losses
incurred from the Cut-off Date through the
last day of the calendar month preceding
such Distribution Date and (B) the
aggregate principal balance of the Mortgage
Loans as of the Cut-off Date exceeds
the Stepdown Required Loss Percentage.
Subordinated Certificate Available Funds Cap: With respect to a
Distribution Date, the per annum rate equal
to the weighted average (weighted in
proportion to the results of subtracting
the current Certificate Principal
Balance of the related Class A Certificates
from the aggregate Stated Principal
Balance of the Mortgage Loans in each
Mortgage Group as of the immediately
preceding Distribution Date (or, in the
case of the first Distribution Date, as
of the Cut-off Date) of the Class A-1
Available Funds Cap and the Class A-2
Available Funds Cap.
Subordinated Certificate Cap Contract: The amended confirmation
and
agreement and any related confirmation
thereto, between the Trust Fund or
Trustee and the Cap Contract Counterparty
(in the form of Exhibit N-3 hereto).
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<PAGE>
Subordinated Certificate Cap Contract Notional Balance: With
respect to
any Distribution Date, the Subordinated
Certificate Cap Contract Notional
Balance set forth for such Distribution
Date in the Subordinated Certificate
One-Month LIBOR Cap Table attached hereto
as Exhibit O-3.
Subordinated Certificate Cap Contract Termination Date: The day
after
the Distribution Date in April 2011.
Subordinated Certificate Maximum Rate Cap: With respect to a
Distribution Date, the per annum rate equal
to the weighted average (weighted in
proportion to the results of subtracting
from the aggregate Stated Principal
Balance of the Mortgage Loans in each
Mortgage Group as of the immediately
preceding Distribution Date (or, in the
case of the first Distribution Date, as
of the Cut-off Date) the current
Certificate Principal Balance of the related
Class A Certificates) of the Class A-1
Maximum Rate Cap and the Class A-2
Maximum Rate Cap.
Subordinated Certificate Upper Collar: With respect to each
Distribution Date with respect to which
payments are received on the
Subordinated Certificate Cap Contract, a
rate equal to the lesser of One-Month
LIBOR and 8.320% per annum.
Subordinated Certificates: Each Class of the Class M and Class
B
Certificates.
Subsequent Recovery: Any amount received on a Mortgage Loan (net
of
amounts reimbursed to the Servicer related
to such Mortgage Loan) subsequent to
such Mortgage Loan being determined to be a
Liquidated Mortgage Loan.
Subservicing Agreement: As defined in Section 3.02(a).
Substitution Adjustment Amount: The meaning ascribed to such
term
pursuant to Section 2.03(c).
Tax Matters Person: The Person designated as "tax matters person"
in
the manner provided under Treasury
regulation Section 1.860F-4(d) and Treasury
regulation Section 301.6231(a)(7)-1.
Transfer: Any direct or indirect transfer or sale of any
Ownership
Interest in a Certificate.
Transfer Agreement: Each document set out on Exhibit J hereto
pursuant
to which the Seller acquired any Mortgage
Loan from the Transferor of such
Mortgage Loan.
Transferor: Any
originator of a Mortgage Loan.
Trust Fund: The corpus of the trust (the "Merrill Lynch
Mortgage
Investors Trust, Series 2005-HE1") created
hereunder consisting of (i) the
Mortgage Loans and all interest and
principal received on or with respect
thereto on and after the Cut-off Date to
the extent not applied in computing the
Cut-off Date Principal Balance thereof,
exclusive of interest not required to be
deposited in the Collection Account; (ii)
the Collection Account and the
Certificate Account and all amounts
deposited therein pursuant to the applicable
provisions of this Agreement; (iii)
property that secured a Mortgage Loan and
has been acquired by foreclosure, deed in
lieu of foreclosure or otherwise; (iv)
the mortgagee's rights under the Insurance
Policies with respect to the Mortgage
Loans (including, without limitation, the
MI Policies); (v) all proceeds of the
conversion, voluntary or involuntary, of
any of the foregoing into cash or other
liquid property; and (vi) the Cap Contract
and Cap Contract Account.
- 45 -
<PAGE>
Trustee: Wells Fargo
Bank, N.A., a national banking association, not in
its individual capacity, but solely in its
capacity as trustee for the benefit
of the Certificateholders under this
Agreement, and any successor thereto, and
any corporation or national banking
association resulting from or surviving any
consolidation or merger to which it or its
successors may be a party and any
successor trustee as may from time to time
be serving as successor trustee
hereunder.
Uncertificated Class C Interest: An uncertificated interest having
(i)
the same rights to payments as the Class C
Certificates, other than the rights
to payments of amounts with respect to the
Cap Contracts, and (ii) the rights to
the payments treated as distributed to the
Class C Certificates under Section
2.07(d), provided, however, that such
interest shall have no obligation to make
any payments treated as paid by the Class C
Certificates pursuant to interest
rate cap agreements under Section
2.07(d).
Underlying Mortgaged Property: With respect to each Co-op Loan,
the
underlying real property owned by the
related residential cooperative housing
corporation.
Unpaid Realized Loss Amount: The Class M-1 Unpaid Realized Loss
Amount,
Class M-2 Unpaid Realized Loss Amount,
Class M-3 Unpaid Realized Loss Amount,
Class B-1 Unpaid Realized Loss Amount,
Class B-2 Unpaid Realized Loss Amount,
Class B-3 Unpaid Realized Loss Amount,
Class B-4 Unpaid Realized Loss Amount,
Class B-5 Unpaid Realized Loss Amount, and
Class C Unpaid Realized Loss Amount,
collectively.
Upper Collar: Any of the Class A-1 Upper Collar, the Class A-2
Upper
Collar or the Subordinated Certificate
Upper Collar.
Upper Tier REMIC: As described in the Preliminary Statement and
Section
2.07.
USAP Report: A report in compliance with the Uniform Single
Attestation
Program for Mortgage Bankers delivered in
accordance with Section 3.18.
Voting Rights: The portion of the voting rights of all the
Certificates
that is allocated to any of the
Certificates for purposes of the voting
provisions hereunder. Voting Rights
allocated to each Class of Certificates
shall be allocated as follows: (1) 98% to
the Class A, Class M and Class B
Certificates, with the allocation among
such Certificates to be in proportion to
the Certificate Principal Balance of each
Class relative to the Certificate
Principal Balance of all other Classes and
(2) each Class of the Class C and
Class P will be allocated 2% of the Voting
Rights. Voting Rights will be
allocated among the Certificates of each
such Class in accordance with their
respective Percentage Interests.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
Section 2.01. Conveyance of Mortgage Loans.
The Depositor, concurrently with the execution and delivery
hereof,
does hereby sell, transfer, assign, set
over and convey to the Trustee without
recourse all the right, title and interest
of the Depositor in and to the assets
of the Trust Fund. Such assignment includes
all interest and principal received
on or with respect to the Mortgage Loans on
or after the Cut-off Date (other
than Scheduled Payments due on the Mortgage
Loans on or before the Cut-off
Date).
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<PAGE>
It is agreed and understood by the Depositor, the Servicer and
the
Trustee that it is not intended that any
Mortgage Loan be included in the Trust
that is, without limitation, a "High-Cost
Home Loan" as defined by the Home
Ownership and Equity Protection Act of 1994
or any other applicable
anti-predatory lending laws, including but
not limited to (i) a "High-Cost Home
Loan" as defined in the New Jersey Home
Ownership Act effective November 27,
2003; (ii) a "High-Cost Home Loan" as
defined in the New Mexico Home Loan
Protection Act effective January 1, 2004;
or (iii) a "High-Cost Home Loan" as
defined in the Massachusetts Predatory Home
Loan Practices Act effective
November 7, 2004 or (iv) a "High-Cost Home
Loan" as defined by the Indiana High
Cost Home Loan Law effective January 1,
2005.
(i) In connection with such assignment, the Depositor does
hereby
deliver to, and deposit with, the Trustee,
the following documents or
instruments with respect to each Mortgage
Loan:
(A) The original Mortgage Note endorsed in blank or, "Pay to
the
order of Wells Fargo Bank, N.A., as trustee, without recourse"
together
with all riders thereto. The Mortgage Note shall include all
intervening endorsements showing a complete chain of the title from
the
Transferor to [____________________];
(B) Except as provided below and for each Mortgage Loan that is
not
a MERS Loan, the original recorded Mortgage together with all
riders
thereto, with evidence of recording thereon, or, if the
original
Mortgage has not yet been returned from the recording office, a
copy of
the original Mortgage together with all riders thereto certified by
the
Transferor to be true copy of the original of the Mortgage that
has
been delivered for recording in the appropriate recording office of
the
jurisdiction in which the Mortgaged Property is located and in the
case
of each MERS Loan, the original Mortgage together with all
riders
thereto, noting the presence of the MIN of the Loan and either
language
indicating that 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;
(C) In the case of each Mortgage Loan that is not a MERS Loan,
the
original Assignment of each Mortgage endorsed either in blank or,
to
"Wells Fargo Bank, N.A., as trustee;"
(D) The original
policy of title insurance (or a preliminary title
report, commitment or binder if the original title insurance policy
has
not been received from the title insurance company);
(E) Originals of any intervening assignments of the Mortgage,
with
evidence of recording thereon or, if the original intervening
assignment has not yet been returned from the recording office, a
copy
of such assignment certified to be a true copy of the original of
the
assignment which has been sent for recording in the appropriate
jurisdiction in which the Mortgaged Property is located; and
(F) Originals of all assumption and modification agreements, if
any.
(ii) In connection with such assignment, the Depositor does
hereby
deliver to, and deposit with, the Trustee
the following documents or instruments
with respect to each Mortgage Loan so
assigned that is a Co-op Loan:
(A) (i) The original Mortgage Note (or a lost note affidavit
(including a copy of the original Mortgage Note)) or (ii) the
original
consolidation, extension and modification agreement
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<PAGE>
(or a lost note affidavit (including a copy of the original
consolidation, extension and modification agreement)), in either
case
endorsed either in blank or, "Pay to the order of Wells Fargo
Bank,
N.A., as trustee, without recourse";
(B) The original Mortgage entered into by the Mortgagor with
respect
to such Co-Op Loan;
(C) The original Assignment of Mortgage endorsed either in blank
or
to "Wells Fargo Bank, N.A., as trustee";
(D) The original assignments of Mortgage showing a complete chain
of
assignment from the originator of the related Co-Op Loan to the
last
endorsee on the Mortgage Note;
(E) The original Form UCC-1 and any continuation statements
with
evidence of filing thereon entered into by the Mortgagor with
respect
to such Co-Op Loan (or a recorded copy thereof);
(F) Form UCC-3 (or copy thereof) by the Transferor or its agent
assigning the security interest covered by such Form UCC-1 to
"Wells
Fargo Bank, N.A., as trustee," together with all Forms UCC-3 (or
copies
thereof) showing a complete chain of assignment from the originator
of
the related Co-op Loan to the Transferor, with evidence of
recording
thereon;
(G) The original stock certificate representing the stock
allocated
to the related dwelling unit in the related residential
cooperative
housing corporation and pledged by the related Mortgagor to the
originator
of such Co-op Loan with a stock power in blank attached;
(H) The original proprietary lease;
(I) The original assignment of proprietary lease or a copy
thereof,
to the Trustee or in blank, and all intervening assignments
thereof;
(J) The original recognition agreement or a copy thereof of the
interests of the mortgagee with respect to the Co-op Loan by
the
residential cooperative housing corporation, the stock of which
was
pledged by the related Mortgagor to the originator of such Co-op
Loan;
and
(K) Originals of any assumption, consolidation or modification
agreements relating to any of the items specified in (A) through
(F)
above with respect to such Co-op Loan.
If in connection with any Mortgage Loan that is not a Co-op Loan,
the
Depositor cannot deliver the Mortgage,
Assignments of Mortgage or assumption,
consolidation or modification, as the case
may be, with evidence of recording
thereon, if applicable, concurrently with
the execution and delivery of this
Agreement solely because of a delay caused
by the public recording office where
such Mortgage, Assignments of Mortgage or
assumption, consolidation or
modification, as the case may be, has been
delivered for recordation, the
Depositor shall deliver or cause to be
delivered to the Trustee written notice
stating that such Mortgage or assumption,
consolidation or modification, as the
case may be, has been delivered to the
appropriate public recording office for
recordation. Thereafter, the Depositor
shall deliver or cause to be delivered to
the Trustee such Mortgage, Assignments of
Mortgage or assumption, consolidation
or modification, as the case may be, with
evidence of recording indicated
thereon, if applicable, upon receipt
thereof from the public recording office.
To the extent any required endorsement is
not contained on a Mortgage Note or an
Assignment of Mortgage, the Depositor shall
make or cause such endorsement to be
made.
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<PAGE>
With respect to any Mortgage Loan that is not a Co-op Loan, none of
the
Depositor, the Servicer or the Trustee
shall be obligated to cause to be
recorded the Assignment of Mortgage
referred to in this Section 2.01. With
respect to any Co-op Loan, none of the
Depositor, the Servicer or the Trustee
shall be obligated to cause to be filed the
Form UCC-3 referred to in this
Section 2.01. In the event that any
Assignment of Mortgage referred to in this
Section 2.01 is not recorded or is
improperly recorded, the Servicer and the
Trustee shall have no liability for any
failure to receive or act on notices
related to such Assignment of Mortgage.
The ownership of each Mortgage Note, the Mortgage and the contents
of
the related Mortgage File is vested in the
Trustee on behalf of the
Certificateholders. Neither the Depositor
nor the Servicer shall take any action
inconsistent with such ownership and shall
not claim any ownership interest
therein. The Depositor and the Servicer
shall respond to any third party
inquiries with respect to ownership of the
Mortgage Loans by stating that such
ownership is held by the Trustee on behalf
of the Certificateholders. Mortgage
documents relating to the Mortgage Loans
not delivered to the Trustee are and
shall be held in trust by the Servicer, for
the benefit of the Trustee as the
owner thereof, and the Servicer's
possession of the contents of each Mortgage
File so retained is for the sole purpose of
servicing the related Mortgage Loan,
and such retention and possession by the
Servicer is in a custodial capacity
only. The Depositor agrees to take no
action inconsistent with the Trustee's
ownership of the Mortgage Loans, to
promptly indicate to all inquiring parties
that the Mortgage Loans have been sold and
to claim no ownership interest in the
Mortgage Loans.
It is the intention of this Agreement that the conveyance of
the
Depositor's right, title and interest in
and to the Trust Fund pursuant to this
Agreement shall constitute a purchase and
sale and not a loan. If a conveyance
of Mortgage Loans from the Seller to the
Depositor is characterized as a pledge
and not a sale, then the Depositor shall be
deemed to have transferred to the
Trustee all of the Depositor's right, title
and interest in, to and under the
obligations of the Seller deemed to be
secured by said pledge; and it is the
intention of this Agreement that the
Depositor shall also be deemed to have
granted to the Trustee a first priority
security interest in all of the
Depositor's right, title, and interest in,
to and under the obligations of the
Seller to the Depositor deemed to be
secured by said pledge and that the Trustee
shall be deemed to be an independent
custodian for purposes of perfection of the
security interest granted to the Depositor.
If the conveyance of the Mortgage
Loans from the Depositor to the Trustee is
characterized as a pledge, it is the
intention of this Agreement that this
Agreement shall constitute a security
agreement under applicable law, and that
the Depositor shall be deemed to have
granted to the Trustee a first priority
security interest in all of the
Depositor's right, title and interest in,
to and under the Mortgage Loans, all
payments of principal of or interest on
such Mortgage Loans, all other rights
relating to and payments made in respect of
the Trust Fund, and all proceeds of
any thereof. If the trust created by this
Agreement terminates prior to the
satisfaction of the claims of any Person in
any Certificates, the security
interest created hereby shall continue in
full force and effect and the Trustee
shall be deemed to be the collateral agent
for the benefit of such Person.
In addition to the conveyance made in the first paragraph of
this
Section 2.01, the Depositor does hereby
convey, assign and set over to the
Trustee for the benefit of the
Certificateholders its rights and interests under
the Sale Agreement, including the
Depositor's right, title and interest in the
representations and warranties contained in
the Sale Agreement, the rights in
the Transfer Agreements described therein,
and the benefit of the repurchase
obligations and the obligation of the
Seller contained in the Sale Agreement to
take, at the request of the Depositor or
the Trustee, all action on its part
which is reasonably necessary to ensure the
enforceability of a Mortgage Loan.
The Trustee hereby accepts such assignment,
and shall be entitled to exercise
all rights of the Depositor under the Sale
Agreement as if, for such purpose, it
were the Depositor. The foregoing sale,
transfer, assignment, set-over, deposit
and conveyance does not and is not intended
to result in creation or assumption
by the Trustee of any
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<PAGE>
obligation of the Depositor, the Seller, or
any other Person in connection with
the Mortgage Loans or any other agreement
or instrument relating thereto except
as specifically set forth herein.
Section 2.02. Acceptance by the Trustee of the Mortgage Loans.
Except as set forth in the Exception Report delivered
contemporaneously
herewith (the "Exception Report"), the
Trustee acknowledges receipt of the
Mortgage Note for each Mortgage Loan and
delivery of a Mortgage File (but does
not acknowledge receipt of all documents
required to be included in such
Mortgage File) with respect to each
Mortgage Loan and declares that it holds and
will hold such documents and any other
documents constituting a part of the
Mortgage Files delivered to it in trust for
the use and benefit of all present
and future Certificateholders. The
Depositor will cause the Seller to repurchase
any Mortgage Loan to which a material
exception was taken in the Exception
Report unless such exception is cured to
the satisfaction of the Trustee within
45 Business Days of the Closing Date.
The Trustee acknowledges receipt of the three Cap Contracts (forms
of
which are attached hereto as Exhibits N-1,
N-2 and N-3), the Transfer
Agreements, the Bring Down Letters and the
Sale Agreement.
The Trustee agrees, for the benefit of Certificateholders and the
NIMs
Insurer, to review each Mortgage File
delivered to it within 60 days after the
Closing Date to ascertain and to certify,
within 70 days of the Closing Date, to
the NIMs Insurer, the Depositor and the
Servicer that all documents required by
Section 2.01 have been executed and
received, and that such documents relate to
the Mortgage Loans identified in Exhibit B
that have been conveyed to it. If the
Trustee finds any document or documents
constituting a part of a Mortgage File
to be missing or defective (that is,
mutilated, damaged, defaced or unexecuted)
in any material respect, the Trustee shall
promptly (and in any event within no
more than five Business Days) after such
finding so notify the NIMs Insurer, the
Servicer, the Seller and the Depositor. In
addition, the Trustee shall also
notify the NIMs Insurer, the Servicer, the
Seller and the Depositor if the
original Mortgage with evidence of
recording thereon with respect to a Mortgage
Loan is not received within 60 days of the
Closing Date; if it has not been
received because of a delay caused by the
public recording office where such
Mortgage has been delivered for
recordation, the Depositor shall deliver or
cause to be delivered to the Trustee
written notice stating that such Mortgage
has been delivered to the appropriate
public recording office for recordation
and thereafter the Depositor shall deliver
or cause to be delivered such
Mortgage with evidence of recording thereon
upon receipt thereof from the public
recording office. The Trustee shall request
that the Seller correct or cure such
omission, defect or other irregularity, or
substitute a Mortgage Loan pursuant
to the provisions of Section 2.03, within
90 days from the date the Seller was
notified of such omission or defect and, if
the Seller does not correct or cure
such omission or defect within such period,
that the Seller purchase such
Mortgage Loan from the Trust Fund within 90
days from the date the Trustee
notified the Seller of such omission,
defect or other irregularity at the
Purchase Price of such Mortgage Loan. The
Purchase Price for any Mortgage Loan
purchased pursuant to this Section 2.02
shall be paid to the Servicer and
deposited by the Servicer in the
Certificate Account or Collection Account, as
appropriate, promptly upon receipt, and,
upon receipt by the Trustee of written
notification of such deposit signed by a
Servicing Officer, the Trustee, upon
receipt of a Request for Release, shall
promptly release to the Seller the
related Mortgage File and the Trustee shall
execute and deliver such instruments
of transfer or assignment, without
recourse, as shall be requested by the Seller
and necessary to vest in the Seller or its
designee, as the case may be, any
Mortgage Loan released pursuant hereto, and
the Trustee shall have no further
responsibility with regard to such Mortgage
Loan. It is understood and agreed
that the obligation of the Seller to
purchase, cure or substitute any Mortgage
Loan as to which a material defect in or
omission of a constituent document
exists shall constitute the sole remedy
respecting such defect or omission
available to the Trustee on behalf of
Certificateholders and the NIMs Insurer.
The preceding sentence shall not, however,
limit any
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<PAGE>
remedies available to the
Certificateholders, the NIMs Insurer, the Depositor or
the Trustee pursuant to the Sale Agreement,
the Transfer Agreements or any
Bring-Down Letter. The Trustee shall be
under no duty or obligation to inspect,
review and examine such documents,
instruments, certificates or other papers to
determine that they are genuine,
enforceable, recordable or appropriate to the
represented purpose, or that they have
actually been recorded, or that they are
other than what they purport to be on their
face. The Servicer and the Trustee
shall keep confidential the name of each
Mortgagor except as required for the
performance of this Agreement and the
Servicer and the Trustee shall not solicit
any such Mortgagor for the purpose of
refinancing the related Mortgage Loan;
notwithstanding anything herein to the
contrary, the foregoing shall not be
construed to prohibit (i) disclosure of any
and all information that is or
becomes publicly known, or information
obtained by the Trustee or the Servicer
from sources other than the other parties
hereto, (ii) disclosure of any and all
information (A) if required to do so by any
applicable law, rule or regulation,
(B) to any government agency or regulatory
body having or claiming authority to
regulate or oversee any aspects of the
Trustee's business or that of its
affiliates, (C) pursuant to any subpoena,
civil investigation demand or similar
demand or request of any court, regulatory
authority, arbitrator or pursuant to
any arbitration to which Trustee or any
affiliate or an officer, director,
employer or shareholder thereof is a party
or (D) to any affiliate, independent
or internal auditor, agent, employee or
attorney of the Trustee having a need to
know the same, provided that the Trustee
advises such recipient of the
confidential nature of the information
being disclosed, or (iii) any other
disclosure authorized by the Depositor. The
Servicer shall provide to the
Depositor any information related to the
Mortgage Loans requested by the
Depositor. It is understood and agreed that
all rights and benefits relating to
the solicitation of any Mortgagors and the
attendant rights, title and interest
in and to the list of Mortgagors and data
relating to their Mortgages shall be
retained by the Servicer.
Within 70 days of the Closing Date, the Trustee shall deliver to
the
NIMs Insurer, the Depositor and the
Servicer the Trustee's Certification,
substantially in the form of Exhibit D
attached hereto, evidencing the
completeness of the Mortgage Files, with
any exceptions noted thereto.
Section 2.03. Representations, Warranties and Covenants of the
Depositor.
(a) The Depositor hereby represents and warrants to the Servicer,
the
NIMs Insurer and the Trustee as follows, as
of the date hereof:
(i) The Depositor is duly organized and is validly existing as
a
corporation in good standing under the laws of the State of
Delaware and
has full
power and authority (corporate and other) necessary to own or
hold its
properties and to conduct its business as now conducted by it
and
to enter
into and perform its obligations under this Agreement and the
Sale
Agreement.
(ii) The Depositor has the full corporate power and authority
to
execute,
deliver and perform, and to enter into and consummate the
transactions contemplated by, this Agreement and the Sale Agreement
and
has duly
authorized, by all necessary corporate action on its part, the
execution,
delivery and performance of this Agreement and the Sale
Agreement;
and this Agreement and the Sale Agreement, assuming the due
authorization, execution and delivery hereof by the other parties
hereto,
constitutes a
legal, valid and binding obligation of the Depositor,
enforceable against the Depositor in accordance with its terms,
subject,
as to
enforceability, to (i) bankruptcy, insolvency, reorganization,
moratorium
and other similar laws affecting creditors' rights generally
and (ii)
general principles of equity, regardless of whether enforcement
is sought
in a proceeding in equity or at law.
(iii) The execution and delivery of this Agreement and the Sale
Agreement
by the Depositor, the consummation of the transactions
contemplated by this Agreement and the Sale Agreement, and the
fulfillment
of or
compliance with the terms hereof are in the ordinary course
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<PAGE>
of
business of the Depositor and will not (A) result in a material
breach
of any
term or provision of the charter or by-laws of the Depositor or
(B)
materially
conflict with, result in a violation or acceleration of, or
result in
a material default under, the terms of any other material
agreement
or instrument to which the Depositor is a party or by which it
may be
bound or (C) constitute a material violation of any statute,
order
or
regulation applicable to the Depositor of any court, regulatory
body,
administrative agency or governmental body having jurisdiction over
the
Depositor;
and the Depositor is not in breach or violation of any material
indenture
or other material agreement or instrument, or in violation of
any
statute, order or regulation of any court, regulatory body,
administrative agency or governmental body having jurisdiction over
it
which
breach or violation may materially impair the Depositor's ability
to
perform or
meet any of its obligations under this Agreement.
(iv) No litigation is pending, or, to the best of the
Depositor's
knowledge,
threatened, against the Depositor that would materially and
adversely
affect the execution, delivery or enforceability of this
Agreement
and the Sale Agreement or the ability of the Depositor to
perform
its obligations under this Agreement and the Sale Agreement in
accordance
with the terms hereof.
(v) No consent,
approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery
and
performance by the Depositor of, or compliance by the Depositor
with, this
Agreement
and the Sale Agreement or the consummation of the transactions
contemplated hereby, or if any such consent, approval,
authorization or
order is
required, the Depositor has obtained the same. The Depositor
hereby
represents and warrants to the Trustee with respect to each
Mortgage
Loan as of the Closing Date, and following the transfer of the
Mortgage
Loans to it by the Seller, the Depositor had good title to the
Mortgage
Loans and the Mortgage Notes were subject to no offsets,
claims,
liens, mortgage,
pledge, charge, security interest, defenses or
counterclaims.
(b) The representations and warranties of each Transferor with
respect
to the related Mortgage Loans in the
applicable Transfer Agreement, which have
been assigned to the Trustee hereunder,
were made as of the date specified in
the applicable Transfer Agreement and
brought forward to the Closing Date
pursuant to the related Bring Down Letter.
The representations and warranties of
each Transferor with respect to the
Mortgage Loans contained in the Bring Down
Letter were made as of the Closing Date.
The representations and warranties of
the Seller with respect to the Mortgage
Loans contained in the Sale Agreement
were made as of the Closing Date. To the
extent that any fact, condition or
event with respect to a Mortgage Loan
constitutes a breach of both (i) a
representation or warranty of the
applicable Transferor under the applicable
Transfer Agreement and (ii) a
representation or warranty of the Seller under the
Sale Agreement, the only right or remedy of
the Trustee, the NIMs Insurer or of
any Certificateholder shall be the
Trustee's right to enforce the obligations of
the applicable Transferor under any
applicable representation or warranty made
by it. Unless otherwise stated in the Sale
Agreement, the Trustee acknowledges
that the Seller shall have no obligation or
liability with respect to any breach
of a representation or warranty made by it
with respect to the Mortgage Loans if
the fact, condition or event constituting
such breach also constitutes a breach
of a representation or warranty made by the
related Transferor in the related
Transfer Agreement, without regard to
whether the Transferors fulfills its
contractual obligations in respect of such
representation or warranty. The
Trustee also acknowledges that the Seller
shall have no obligation or liability
with respect to any breach of a
representation or warranty made solely by the
Transferors with respect to the Mortgage
Loans, without regard to whether the
related Transferor fulfills its contractual
obligations in respect of such
representation or warranty. The Trustee
further acknowledges that the Depositor
shall have no obligation or liability with
respect to any breach of any
representation or warranty with respect to
the Mortgage Loans (except as set
forth in Section 2.03(a)(v)) under any
circumstances.
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<PAGE>
In addition to the representations and warranties of the
Transferors in
the Transfer Agreements that were brought
forward to the Closing Date pursuant
to the Bring Down Letters, with respect to
each Mortgage Loan, each Transferor
made certain additional covenants regarding
such Mortgage Loan, as set forth in
the related Transfer Agreement. With
respect to any breach of such additional
covenants that materially and adversely
affects the interests of the
Certificateholders in such Mortgage Loan,
the Seller shall (1) use reasonable
efforts to enforce such covenant against
the related Transferor and (2) if the
Seller successfully enforces any obligation
of the related Transferor to
repurchase such Mortgage Loan, the Seller
shall repurchase such Mortgage Loan in
accordance with this Section 2.03. If the
Seller does not successfully enforce
the obligation, if any, of the Transferor
to repurchase a Mortgage Loan with
respect to any breach of any such
additional covenants, the Seller shall have no
obligation or right to repurchase or cure
such Mortgage Loan.
(c) Upon discovery by any of the Depositor, the Servicer, the
NIMs
Insurer or the Trustee of a breach of any
of such representations and warranties
that adversely and materially affects the
value of the related Mortgage Loan,
Prepayment Charges or the interests of the
Certificateholders, the party
discovering such breach shall give prompt
written notice to the other parties.
Within 90 days of the discovery of such
breach of any representation or
warranty, the applicable Transferor or the
Seller, as applicable, shall either
(a) cure such breach in all material
respects, (b) repurchase such Mortgage Loan
or any property acquired in respect thereof
from the Trustee at the Purchase
Price or (c) within the two year period
following the Closing Date, substitute a
Replacement Mortgage Loan for the affected
Mortgage Loan. In the event of
discovery of a breach of any representation
and warranty of any Transferor or
the Seller, the Trustee shall enforce its
rights under the applicable Transfer
Agreement or the Sale Agreement for the
benefit of Certificateholders and the
NIMs Insurer. If a breach of the
representations and warranties set forth in a
Transfer Agreement exists solely due to the
unenforceability of a Prepayment
Charge, the Trustee shall notify the NIMs
Insurer thereof and not seek to
enforce the repurchase remedy provided for
herein unless directed in writing to
do so by the NIMs Insurer. In the event of
a breach of the representations and
warranties with respect to the Mortgage
Loans set forth in a Transfer Agreement,
the Trustee shall, at the request of the
NIMs Insurer, enforce the right of the
Trust Fund and the NIMs Insurer to be
indemnified for such breach of
representation and warranty. In the event
that such breach relates solely to the
unenforceability of a Prepayment Charge,
amounts received in respect of such
indemnity up to the amount of such
Prepayment Charge shall be distributed
pursuant to Section 4.04(b)(i). As provided
in the Sale Agreement, if the
Transferor substitutes for a Mortgage Loan
for which there is a breach of any
representations and warranties in the
related Transfer Agreement which adversely
and materially affects the value of such
Mortgage Loan and such substitute
mortgage loan is not a Replacement Mortgage
Loan, under the terms of the Sale
Agreement, the Seller will, in exchange for
such substitute Mortgage Loan, (i)
provide the applicable Purchase Price for
the affected Mortgage Loan or (ii)
within two years of the Closing Date,
substitute such affected Mortgage Loan
with a Replacement Mortgage Loan. Any such
substitution shall not be effected
prior to the additional delivery to the
Trustee of a Request for Release
substantially in the form of Exhibit I and
shall not be effected unless it is
within two years of the Startup Day. As
provided in the Sale Agreement, the
Seller indemnifies and holds the Trust
Fund, the Trustee, the Depositor, the
NIMs Insurer, the Servicer and each
Certificateholder harmless against any and
all taxes, claims, losses, penalties,
fines, forfeitures, reasonable legal fees
and related costs, judgments, and any other
costs, fees and expenses that the
Trust Fund, the Trustee, the Depositor, the
NIMs Insurer, the Servicer and any
Certificateholder may sustain in connection
with any actions of the Seller
relating to a repurchase of a Mortgage Loan
other than in compliance with the
terms of this Section 2.03 and the Sale
Agreement, to the extent that any such
action causes (i) any federal or state tax
to be imposed on the Trust Fund or
any REMIC provided for herein, including
without limitation, any federal tax
imposed on "prohibited transactions" under
Section 860F(a)(1) of the Code or on
"contributions after the startup day" under
Section 860G(d)(1) of the Code, or
(ii) any REMIC created hereunder to fail to
qualify as a REMIC at any time that
any Certificate is outstanding. In
furtherance of the foregoing, if the Seller
is not a member of MERS and repurchases
a
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<PAGE>
Mortgage Loan which is registered on the
MERS System, the Seller, at its own
expense and without any right of
reimbursement, shall cause MERS to execute and
deliver an assignment of the Mortgage in
recordable form to transfer the
Mortgage from MERS to the Seller and shall
cause such Mortgage to be removed
from registration on the MERS System in
accordance with MERS' rules and
regulations.
With respect to any Mortgage Loan repurchased by the Depositor
pursuant
to this Agreement, by the Seller pursuant
to the Sale Agreement or by any
Transferor pursuant to the applicable
Transfer Agreement, the principal portion
of the funds received by the Servicer in
respect of such repurchase of a
Mortgage Loan will be considered a
Principal Prepayment and shall be deposited
by the Servicer in the Collection Account
pursuant to Section 3.05 and the
Servicer shall notify the Trustee of its
receipt of the same. The Trustee, upon
receipt of the full amount of the Purchase
Price for a Deleted Mortgage Loan, or
upon receipt of the Mortgage File for a
Replacement Mortgage Loan substituted
for a Deleted Mortgage Loan, shall release
or cause to be released and reassign
to the Depositor, the Seller or the
applicable Transferor, as applicable, the
related Mortgage File for the Deleted
Mortgage Loan and shall execute and
deliver such instruments of transfer or
assignment, in each case without
recourse, representation or warranty, as
shall be necessary to vest in such
party or its designee or assignee title to
any Deleted Mortgage Loan released
pursuant hereto, free and clear of all
security interests, liens and other
encumbrances created by this Agreement,
which instruments shall be prepared by
the Trustee, and the Trustee shall not have
any further responsibility with
respect to the Mortgage File relating to
such Deleted Mortgage Loan.
With respect to each Replacement Mortgage Loan to be delivered to
the
Trustee pursuant to the terms of this
Article II in exchange for a Deleted
Mortgage Loan: (i) the Depositor, the
applicable Transferor or the Seller, as
applicable, must deliver to the Trustee (or
its custodian) the Mortgage File for
the Replacement Mortgage Loan containing
the documents set forth in Section 2.01
along with a written certification
certifying as to the satisfaction by such
Mortgage Loan of all requirements under the
definition of Replacement Mortgage
Loan and the delivery of such Mortgage File
and containing the granting language
set forth in Section 2.01; and (ii) the
Depositor will be deemed to have made,
with respect to such Replacement Mortgage
Loan, each of the representations and
warranties made by it with respect to the
related Deleted Mortgage Loan. The
Trustee (or its custodian) shall review the
Mortgage File with respect to each
Replacement Mortgage Loan and certify to
the NIMs Insurer and the Depositor that
all documents required by Section 2.01 have
been executed and received.
For any month in which the Seller substitutes one or more
Replacement
Mortgage Loans for one or more Deleted
Mortgage Loans, the Seller will determine
the amount (if any) by which the aggregate
principal balance of all such
Replacement Mortgage Loans as of the date
of substitution and the aggregate
Prepayment Charges with respect to such
Replacement Mortgage Loans is less than
the aggregate Stated Principal Balance
(after application of the principal
portion of the Scheduled Payment due in the
month of substitution) and aggregate
Prepayment Charges of all such Deleted
Mortgage Loans. An amount equal to the
aggregate of the deficiencies described in
the preceding sentence (such amount,
the "Substitution Adjustment Amount") plus
an amount equal to any unreimbursed
costs, penalties and/or damages incurred by
the Trust Fund in connection with
any violation relating to such Deleted
Mortgage Loan of any predatory or abusive
lending law shall be remitted by the Seller
to the Servicer for deposit into the
Collection Account on the Determination
Date for the Distribution Date relating
to the Prepayment Period during which the
related Mortgage Loan became required
to be purchased or replaced hereunder.
Notwithstanding any
other provision of this Agreement, the right to
substitute Mortgage Loans pursuant to this
Article II shall be subject to the
additional limitations that no substitution
of a Replacement Mortgage Loan for a
Deleted Mortgage Loan shall be made unless
the Trustee and the NIMs Insurer
shall have received an Opinion of Counsel
(at the expense of the party seeking
to make the substitution) that, under
current law, such substitution will not
(A) affect adversely the status of any
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REMIC established hereunder as a REMIC, or
of the related "regular interests" as
"regular interests" in any such REMIC, or
(B) cause any such REMIC to engage in
a "prohibited transaction" or prohibited
contribution pursuant to the REMIC
Provisions.
The Trustee shall cause the Mortgage Loan Schedule to be amended
in
accordance with the terms of this
Agreement.
The Seller shall give or cause to be given written notice to
the
Certificateholders and the NIMs Insurer
that such substitution has taken place,
shall amend the Mortgage Loan Schedule to
reflect the removal of such Deleted
Mortgage Loan from the terms of this
Agreement and the substitution of the
Replacement Mortgage Loan or Replacement
Mortgage Loans and shall deliver a copy
of such amended Mortgage Loan Schedule to
the NIMs Insurer, the Servicer and the
Trustee. Upon such substitution by the
Seller, such Replacement Mortgage Loan or
Replacement Mortgage Loans shall constitute
part of the Mortgage Pool and shall
be subject in all respects to the terms of
this Agreement and the Sale
Agreement, including all applicable
representations and warranties thereof
included in the Sale Agreement as of the
date of substitution.
(d) It is understood and agreed that the representations,
warranties and indemnification (i) set
forth in this Section 2.03, (ii) of the
Seller and the Depositor set forth in the
Sale Agreement and assigned to the
Trustee by the Depositor hereunder and
(iii) of each Transferor, assigned by the
Seller to the Depositor pursuant to the
Sale Agreement and assigned to the
Trustee by the Depositor hereunder shall
each survive delivery of the Mortgage
Files and the Assignment of Mortgage of
each Mortgage Loan to the Trustee and
shall continue throughout the term of this
Agreement.
(e) The Depositor shall deliver a copy of the Mortgage Loan
Schedule to the Servicer on the Closing
Date.
Section 2.04. Representations and Warranties of the Servicer.
(i) The Servicer hereby represents and warrants to the Depositor
and
the Trustee as follows, as of the date hereof:
(ii) The Servicer is duly organized and is validly existing as
a
corporation in good standing under the laws of the State of Nevada
and
is duly authorized and qualified to transact any and all
business
contemplated by this Agreement to be conducted by the Servicer in
any
state in which a Mortgaged Property (or Underlying Mortgaged
Property,
in the case of a Co-op Loan) is located or is otherwise not
required
under applicable law to effect such qualification and, in any
event, is
in compliance with the doing business laws of any such state, to
the
extent necessary to ensure its ability to enforce each Mortgage
Loan,
to service the Mortgage Loans in accordance with the terms of
this
Agreement and to perform any of its other obligations under
this
Agreement in accordance with the terms hereof.
(iii) The Servicer has the corporate power and authority to
service
each Mortgage Loan, and to execute, deliver and perform, and to
enter
into and consummate the transactions contemplated by this Agreement
and
has duly authorized by all necessary corporate action on the part
of
the Servicer the execution, delivery and performance of this
Agreement;
and this Agreement, assuming the due authorization, execution
and
delivery hereof
by the other parties hereto, constitutes a legal, valid
and binding obligation of the Servicer, enforceable against the
Servicer in accordance with its terms, except that (a) the
enforceability hereof may be limited by bankruptcy, insolvency,
moratorium, receivership and other similar laws relating to
creditors'
rights generally and (b) the remedy of specific performance and
injunctive and other forms
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of equitable relief may be subject to equitable defenses and to
the
discretion of the court before which any proceeding therefor may
be
brought.
(iv) The execution and delivery of this Agreement by the
Servicer,
the servicing of the Mortgage Loans under this Agreement, the
consummation of any other of the transactions contemplated by
this
Agreement, and the fulfillment of or compliance with the terms
hereof
are in the ordinary course of business of the Servicer and will not
(A)
result in a material breach of any term or provision of the charter
or
by-laws of the Servicer or (B) materially conflict with, result in
a
material breach, violation or acceleration of, or result in a
material
default under, the terms of any other material agreement or
instrument
to which the Servicer is a party or by which it may be bound, or
(C)
constitute a material violation of any statute, order or
regulation
applicable to the Servicer of any court, regulatory body,
administrative agency or governmental body having jurisdiction over
the
Servicer; and the Servicer is not in breach or violation of any
material indenture or other material agreement or instrument, or
in
violation of any statute, order or regulation of any court,
regulatory
body, administrative agency or governmental body having
jurisdiction
over it which breach or violation may materially impair the
Servicer's
ability to perform or meet any of its obligations under this
Agreement.
(v) The Servicer is an approved servicer of mortgage loans for
Fannie Mae and is an approved servicer of mortgage loans for
Freddie
Mac.
(vi) No litigation is pending or, to the best of the Servicer's
knowledge, threatened, against the Servicer that would materially
and
adversely affect the execution, delivery or enforceability of
this
Agreement or the ability of the Servicer to service the Mortgage
Loans
or to perform any of its other obligations under this Agreement
in
accordance with the terms hereof.
(vii) No consent, approval, authorization or order of any court
or
governmental agency or body is required for the execution, delivery
and
performance by the Servicer of, or compliance by the Servicer
with,
this Agreement or the consummation of the transactions
contemplated
hereby, or if any such consent, approval, authorization or order
is
required, the Servicer has obtained the same.
(viii) The Servicer has fully furnished and will fully furnish
(for
the period it serviced the Mortgage Loans), in accordance with the
Fair
Credit Reporting Act and its implementing regulations, accurate
and
complete information (e.g., favorable and unfavorable) on its
borrower
credit files to Equifax, Experian and Trans Union Credit
Information
Company on a monthly basis.
(ix) Unless otherwise indicated on Exhibit M, the Servicer has
not
by written agreement with the Mortgagor waived, altered, modified
or
released the Mortgage or Mortgage Note during such time as the
Servicer
serviced the related Mortgage Loan.
Section 2.05. Substitutions and Repurchases of Mortgage Loans which
are
not "Qualified Mortgages."
Upon discovery by the Depositor, the 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 5 Business Days of
discovery) give written notice
thereof to the other parties. In connection
therewith, the Depositor shall, at
the Depositor's option, either (i)
substitute, if the conditions in Section
2.03(c) with respect to substitutions are
satisfied, a Replacement Mortgage Loan
for the affected Mortgage Loan, or (ii)
repurchase the affected Mortgage
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<PAGE>
Loan within 90 days of such discovery in
the same manner as it would a Mortgage
Loan for a breach of representation or
warranty contained in Section 2.03. The
Trustee shall reconvey to the Depositor the
Mortgage Loan to be released
pursuant hereto in the same manner, and on
the same terms and conditions, as it
would a Mortgage Loan repurchased for
breach of a representation or warranty
contained in Section 2.03.
Section 2.06. Authentication and Delivery of Certificates.
The Trustee acknowledges the transfer and assignment to it of the
Trust
Fund and, concurrently with such transfer
and assignment, the Trustee has caused
to be authenticated and delivered to or
upon the order of the Depositor, in
exchange for the Mortgage Loans,
Certificates duly authenticated by the Trustee
in authorized denominations evidencing
ownership of the entire 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 its duties set forth in this
Agreement in accordance with the provisions
hereof to the best of its abilities, to the
end that the interests of the
Holders may be adequately and effectively
protected.
Section 2.07. REMIC Elections.
(a) The Depositor hereby instructs and authorizes the Trustee
to make an appropriate election to treat
each of the Upper Tier REMIC and the
Lower Tier REMIC as a REMIC. The Trustee
shall sign the returns providing for
suc
