EXHIBIT 4
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WELLS FARGO ASSET SECURITIES CORPORATION,
Depositor
WELLS FARGO BANK, N.A.,
Servicer
WELLS FARGO BANK, N.A.,
Securities Administrator
and
HSBC Bank USA, National Association,
Trustee
POOLING AND SERVICING AGREEMENT
Dated as of June 29, 2005
Home Equity
Asset-Backed Certificates, Series 2005-1
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<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
Section 1.01 Defined
Terms..................................................4
Section 1.02
Accounting....................................................58
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01 Conveyance of Mortgage
Loans.................................
Section 2.02 Acceptance by
Custodian......................................
Section 2.03 Repurchase or Substitution of
Mortgage Loans by the
Depositor....................................................
Section 2.04 Representations and Warranties of
the Depositor with
respect to the Mortgage Loans................................
Section 2.05 Representations, Warranties and
Covenants of the Servicer....
Section 2.06 Representations and Warranties of
the Depositor..............
Section 2.07 Issuance of Certificates and the
Uncertificated Regular
Interests....................................................
Section 2.08 Optional Substitution of Mortgage
Loans......................
ARTICLE III
ADMINISTRATION AND SERVICING
OF THE TRUST FUND
Section 3.01 Servicer to Act as
Servicer..................................
Section 3.02 Collection of Mortgage Loan
Payments.........................
Section 3.03 Realization Upon Defaulted
Mortgage Loans....................
Section 3.04 Collection Account, Distribution
Account and Reserve
Accounts.....................................................
Section 3.05 Permitted Withdrawals From the
Collection Account............
Section 3.06 Establishment of Escrow Accounts;
Deposits in Escrow
Accounts.....................................................
Section 3.07 Permitted Withdrawals From Escrow
Account....................
Section 3.08 Payment of Taxes, Insurance and
Other Charges;
Collections Thereunder; Primary Mortgage Insurance...........
Section 3.09 Transfer of
Accounts.........................................
Section 3.10 Maintenance of Hazard
Insurance..............................
Section 3.11 Maintenance of Mortgage Impairment
Insurance Policy..........
Section 3.12 Fidelity Bond, Errors and
Omissions Insurance................
Section 3.13 Title, Management and Disposition
of REO Property............
Section 3.14 Due-on-Sale Clauses; Assumption
and Substitution
Agreements...................................................
Section 3.15 Duties of the Credit Risk
Manager............................
Section 3.16 Optional Purchases of 60+ Day
Delinquent Loans...............
Section 3.17 Trustee to Cooperate; Release of
Files.......................
Section 3.18 Servicing
Compensation.......................................
Section 3.19 Annual Statement as to
Compliance............................
Section 3.20 Annual Independent Certified
Public Accountants' Reports.....
Section 3.21 Access to Certain Documentation
and Information Regarding
the Mortgage Loans...........................................
Section 3.22 Obligations of the Servicer in
Respect of Compensating
Interest.....................................................
Section 3.23 Investment of Funds in the
Collection Account and the
Distribution Account.........................................
Section 3.24 Liability of Servicer;
Indemnification.......................
Section 3.25 Reports of Foreclosure and
Abandonment of Mortgaged
Properties...................................................
Section 3.26 Limitation of Liability of the
Credit Risk Manager...........
Section 3.27 No Personal
Solicitation.....................................
Section 3.28 Periodic
Filings.............................................
ARTICLE IV
FLOW OF FUNDS
Section 4.01 Interest
Distributions.......................................
Section 4.02 Distributions of Principal and
Monthly Excess Cashflow
Amounts......................................................
Section 4.03 Allocation of
Losses.........................................
Section 4.04 Method of
Distribution.......................................
Section 4.05 Distributions on Book-Entry
Certificates.....................
Section 4.06
Statements...................................................
Section 4.07 Remittance Reports;
Advances.................................
Section 4.08 REMIC
Distributions..........................................
ARTICLE V
THE CERTIFICATES
Section 5.01 The
Certificates.............................................
Section 5.02 Registration of Transfer and
Exchange of Certificates........
Section 5.03 Mutilated, Destroyed, Lost or
Stolen Certificates............
Section 5.04 Persons Deemed
Owners........................................
Section 5.05 Appointment of Paying
Agent..................................
ARTICLE VI
THE SERVICER AND THE DEPOSITOR
Section 6.01 Liability of the Servicer and the
Depositor..................
Section 6.02 Merger or Consolidation of, or
Assumption of the
Obligations of, the Servicer or the Depositor................
Section 6.03 Limitation on Liability of the
Servicer and Others...........
Section 6.04 Servicer Not to
Resign.......................................
Section 6.05 Delegation of
Duties.........................................
ARTICLE VII
DEFAULT
Section 7.01 Servicer Events of
Termination...............................
Section 7.02 Trustee to Act; Appointment of
Successor.....................
Section 7.03 Waiver of
Defaults...........................................
Section 7.04 Notification to
Certificateholders...........................
Section 7.05 Survival of Servicer
Liabilities.............................
ARTICLE VIII
THE TRUSTEE AND THE SECURITIES ADMINISTRATOR
Section 8.01 Duties of Trustee and Securities
Administrator...............
Section 8.02 Certain Matters Affecting the
Trustee and the Securities
Administrator................................................
Section 8.03 Trustee and Securities
Administrator Not Liable for
Certificates or Mortgage Loans...............................
Section 8.04 Trustee and Securities
Administrator May Own Certificates....
Section 8.05 Trustee and Securities
Administrator Fees and Expenses.......
Section 8.06 Eligibility Requirements for
Trustee and Securities
Administrator................................................
Section 8.07 Resignation or Removal of Trustee
and Securities
Administrator................................................
Section 8.08 Successor Trustee and Successor
Securities Administrator.....
Section 8.09 Merger or Consolidation of Trustee
or Securities
Administrator................................................
Section 8.10 Appointment of Co-Trustee or
Separate Trustee................
Section 8.11 Limitation of
Liability......................................
Section 8.12 Trustee or Securities
Administrator May Enforce Claims
Without Possession of Certificates...........................
Section 8.13 Suits for
Enforcement........................................
Section 8.14 Waiver of Bond
Requirement...................................
Section 8.15 Waiver of Inventory, Accounting
and Appraisal Requirement....
Section 8.16 Appointment of
Custodian.....................................
ARTICLE IX
REMIC AND GRANTOR TRUST ADMINISTRATION
Section 9.01 REMIC
Administration.........................................
Section 9.02 Prohibited Transactions and
Activities.......................
Section 9.03 Indemnification with Respect to
Certain Taxes and Loss of
REMIC Status.................................................
Section 9.04 REO
Property.................................................
Section 9.05 Grantor Trust
Administration.................................
ARTICLE X
TERMINATION
Section 10.01
Termination..................................................
Section 10.02 Additional Termination
Requirements..........................
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01
Amendment....................................................
Section 11.02 Recordation of Agreement;
Counterparts.......................
Section 11.03 Limitation on Rights of
Certificateholders...................
Section 11.04 Governing Law;
Jurisdiction..................................
Section 11.05
Notices......................................................
Section 11.06 Severability of
Provisions...................................
Section 11.07 Article and Section
References...............................
Section 11.08 Notice to the Rating
Agencies................................
Section 11.09 Further
Assurances...........................................
Section 11.10 Benefits of
Agreement........................................
Section 11.11 Acts of
Certificateholders...................................
<PAGE>
EXHIBITS:
Exhibit A-AI-1A Form of Class AI-1A
Certificates
Exhibit A-AI-1B Form of Class AI-1B
Certificates
Exhibit A-AII-1 Form of Class AII-1
Certificates
Exhibit B-1 Form
of Class M-1 Certificates
Exhibit B-2 Form
of Class M-2 Certificates
Exhibit B-3 Form
of Class M-3 Certificates
Exhibit B-4 Form
of Class M-4 Certificates
Exhibit B-5 Form
of Class M-5 Certificates
Exhibit B-6 Form
of Class M-6 Certificates
Exhibit B-7 Form
of Class M-7 Certificates
Exhibit B-8 Form
of Class M-8 Certificates
Exhibit B-9 Form
of Class M-9 Certificates
Exhibit B-10 Form of Class M-10
Certificates
Exhibit B-11 Form of
Class M-11 Certificates
Exhibit B-12 Form of
Class M-12 Certificates
Exhibit B-13 Form of
Class M-13 Certificates
Exhibit B-14 Form of
Class M-14 Certificates
Exhibit C-1 Form
of Class CE Certificates
Exhibit C-2 Form
of Class P Certificates
Exhibit C-3 Form
of Class R Certificates
Exhibit D-1
Group I Mortgage Loan Schedule
Exhibit D-2
Group II Mortgage Loan Schedule
Exhibit E
Form of Request for Release
Exhibit F-1 Form
of Custodian's Initial Certification
Exhibit F-2 Form
of Custodian's Final Certification
Exhibit G
Mortgage Loan Purchase Agreement
Exhibit H
Form of Lost Note Affidavit
Exhibit I
Form of ERISA Representation
Exhibit J-1 Form
of Investment Letter (Non-Rule 144A)
Exhibit J-2 Form
of Rule 144A Investment Letter
Exhibit K
Form of Class R Certificate Transfer Affidavit
Exhibit L-1 Form
of Transferor Certificate for the Class CE, Class P
and Class R Certificates
Exhibit L-2 Form
of Transferor Certificate for the Class M-12, Class
M-13 and Class M-14 Certificates
Exhibit M
Monthly Information Provided by Servicer
Exhibit N-1 Form of Class AI
Yield Maintenance Agreement
Exhibit N-2 Form
of Class AII Yield Maintenance Agreement
Exhibit N-3 Form
of Class M Yield Maintenance Agreement
Exhibit O
Form of Certification
Exhibit P
Form of Certification of the Securities Administrator
to be Provided to Servicer
Exhibit Q
List of Recordation States
Exhibit R
Prepayment Penalty Matrices
<PAGE>
This Pooling and Servicing Agreement is dated as of June 29,
2005
(the "Agreement"), among WELLS FARGO ASSET
SECURITIES CORPORATION, as depositor
(the "Depositor"), WELLS FARGO BANK, N.A.,
as servicer (the "Servicer"), WELLS
FARGO BANK, N.A., as securities
administrator (the "Securities Administrator")
and HSBC BANK USA, NATIONAL ASSOCIATION, as
trustee (the "Trustee").
PRELIMINARY STATEMENT
The Depositor intends to sell pass-through certificates
(collectively, the "Certificates"), to be
issued hereunder in multiple Classes,
which in the aggregate will evidence the
entire beneficial ownership interest in
the Trust Fund created hereunder. The
Certificates will consist of twenty
Classes of Certificates, designated as (i)
the Class AI-1A, Class AI-1B and
Class AII-1 Certificates, (ii) the Class
M-1, Class M-2, Class M-3, Class M-4,
Class M-5, Class M-6, Class M-7, Class M-8,
Class M-9, Class M-10, Class M-11,
Class M-12, Class M-13 and Class M-14
Certificates, (iii) the Class CE
Certificates, (iv) the Class P Certificates
and (v) the Class R Certificate.
REMIC 1
As provided herein, the Trustee will make an election to treat
the
segregated pool of assets consisting of the
Mortgage Loans and certain other
related assets subject to this Agreement
(but exclusive of the Yield Maintenance
Agreements, the Reserve Funds, the Cap
Carryover Amounts, the Prepayment
Penalties, the Servicer Prepayment Penalty
Payment Amounts and the Originator
Prepayment Penalty Payment Amounts) as a
real estate investment conduit (a
"REMIC") for federal income tax purposes,
and such segregated pool of assets
will be designated as "REMIC 1." The Class
R-1 Interest will represent the sole
class of "residual interests" in REMIC 1
for purposes of the REMIC Provisions
under federal income tax law. The following
table irrevocably sets forth the
designation, the Uncertificated REMIC 1
Pass-Through Rate, the initial
Uncertificated Principal Balance, and
solely for purposes of satisfying Treasury
Regulations Section 1.860G-1(a)(4)(iii),
the "latest possible maturity date" for
each of the REMIC 1 Regular Interests. None
of the REMIC 1 Regular Interests
will be certificated.
Uncertificated
Initial
REMIC 1
Uncertificated Latest
Possible
Designation Pass-Through Rate
Principal
Balance Maturity
Date(1)
----------- -----------------
----------------- ----------------
LT1AA
Variable(2)
$615,442,262.33 June 25, 2035
LT1AI1A
Variable(2)
$2,663,050.00 June 25, 2035
LT1AI1B
Variable(2)
$665,765.00 June 25, 2035
LT1AII1
Variable(2)
$1,927,560.00 June 25, 2035
LT1M1
Variable(2)
$160,140.00 June 25, 2035
LT1M2
Variable(2)
$150,725.00 June 25, 2035
LT1M3
Variable(2)
$91,060.00
June 25, 2035
LT1M4
Variable(2)
$78,500.00
June 25, 2035
LT1M5
Variable(2)
$72,220.00
June 25, 2035
LT1M6
Variable(2)
$62,800.00
June 25, 2035
LT1M7
Variable(2)
$62,800.00
June 25, 2035
LT1M8
Variable(2)
$43,960.00
June 25, 2035
LT1M9
Variable(2)
$62,800.00
June 25, 2035
LT1M10
Variable(2)
$62,800.00
June 25, 2035
LT1M11
Variable(2)
$37,680.00
June 25, 2035
LT1M12
Variable(2)
$47,100.00
June 25, 2035
LT1M13
Variable(2)
$25,120.00
June 25, 2035
LT1M14
Variable(2)
$18,840.00
June 25, 2035
LT1ZZ
Variable(2)
$6,327,126.17 June 25, 2035
LT1SUB
Variable(2)
$12,965.31
June 25, 2035
LT1GRP
Variable(2)
$79,541.61
June 25, 2035
LT2SUB
Variable(2)
$7,507.65
June 25, 2035
LT2GRP
Variable(2)
$46,058.85
June 25, 2035
LT1XX
Variable(2)
$627,856,235.08
June 25,
2035
(1) Solely for purposes of
Treasury Regulations Section 1.860G-1(a)(4)(iii),
the
Distribution Date immediately following the maturity date for
the
Mortgage
Loan with the latest maturity date has been designated as the
"latest
possible maturity date" for each REMIC 1 Regular Interest.
(2) Calculated in accordance
with the definition of "Uncertificated REMIC 1
Pass-Through Rate" herein.
REMIC 2
As provided herein,
the Trustee shall make an election to treat the
segregated pool of assets consisting of the
REMIC 1 Regular Interests as a REMIC
for federal income tax purposes, and such
segregated pool of assets will be
designated as "REMIC 2." The Class R-2
Interest represents the sole class of
"residual interests" in REMIC 2 for
purposes of the REMIC Provisions.
The following table sets forth (or describes) the Class
designation,
Original Principal Balance, the
Pass-Through Rate and Assumed Final Maturity
Dates for each Class of Certificates
comprising the interests in the Trust Fund
created hereunder:
Original
Pass-Through Assumed
Final
Class Principal Balance
Rate
Maturity Dates*
----- -----------------
------------
------------------
AI-1A $532,610,000.00
(1)
April 25, 2035
AI-1B $133,153,000.00
(2)
April 25, 2035
AII-1 $385,512,000.00
(3)
April 25, 2035
M-1
$32,028,000.00
(4)
February 25, 2035
M-2
$30,145,000.00 (5)
February 25, 2035
M-3
$18,212,000.00 (6)
January 25, 2035
M-4
$15,700,000.00 (7)
January 25, 2035
M-5
$14,444,000.00 (8)
December 25, 2034
M-6
$12,560,000.00 (9)
November 25, 2034
M-7
$12,560,000.00 (10)
October 25, 2034
M-8
$8,792,000.00 (11)
September 25, 2034
M-9
$12,560,000.00 (12)
August 25, 2034
M-10
$12,560,000.00 (13)
June 25, 2034
M-11
$7,536,000.00 (14)
February 25, 2034
M-12
$9,420,000.00 (15)
October 25, 2033
M-13
$5,024,000.00 (16)
November 25, 2032
M-14 $3,768,000.00
(17)
November 25, 2031
CE
(18)
(18)
N/A
P
N/A
N/A
N/A
R
N/A
N/A
N/A
Total $1,246,584,000.00
* Solely for
purposes of Treasury Regulations Section 1.860G-1(a)(4)(iii),
the
Distribution Date following the maturity date for the Mortgage
Loan
with the
latest maturity date has been designated as the "latest
possible
maturity
date" for each Class of Certificates that represents one or
more
of the
"regular interests" in REMIC 2.
(1) The Pass-Through Rate for
the Class AI-1A Certificates during each
Interest
Accrual Period is equal to the lesser of: (i) the Class AI-1A
Formula
Rate and (ii) the Group I Cap for such Distribution Date.
(2) The Pass-Through Rate for
the Class AI-1B Certificates during each
Interest
Accrual Period is equal to the lesser of: (i) the Class AI-1B
Formula
Rate and (ii) the Group I Cap for such Distribution Date.
(3) The Pass-Through Rate for
the Class AII-1 Certificates during each
Interest
Accrual Period is equal to the lesser of: (i) the Class AII-1
Formula
Rate and (ii) the Group II Cap for such Distribution Date.
(4) The Pass-Through Rate for
the Class M-1 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-1 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(5) The Pass-Through Rate for
the Class M-2 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-2 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(6) The Pass-Through Rate for
the Class M-3 Certificates during each Interest
Accrual Period is equal to
the lesser of: (i) the Class M-3 Formula Rate
and (ii)
the Pool Cap for such Distribution Date.
(7) The Pass-Through Rate for
the Class M-4 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-4 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(8) The Pass-Through Rate for
the Class M-5 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-5 Formula
Rate
and (ii) the Pool Cap for such
Distribution Date.
(9) The Pass-Through Rate for
the Class M-6 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-6 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(10) The Pass-Through Rate for the
Class M-7 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-7 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(11) The Pass-Through Rate for the
Class M-8 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-8 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(12) The Pass-Through Rate for the
Class M-9 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-9 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(13) The Pass-Through Rate for the
Class M-10 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-10 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(14) The Pass-Through Rate for the
Class M-11 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-11 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(15) The Pass-Through Rate for the
Class M-12 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-12 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(16) The Pass-Through Rate for the
Class M-13 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-13 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(17) The Pass-Through Rate for the
Class M-14 Certificates during each Interest
Accrual
Period is equal to the lesser of: (i) the Class M-14 Formula
Rate
and (ii)
the Pool Cap for such Distribution Date.
(18) Solely for REMIC purposes, the
Class CE Certificates will (i) have an
Original
Principal Balance equal to the Initial Overcollateralization
Amount
(but will not bear interest on such amount) and (ii) will bear
interest
on their Notional Amount.
ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms.
Whenever used in this Agreement or in the Preliminary Statement,
the
following words and phrases, unless the
context otherwise requires, shall have
the meanings specified in this Article.
Interest on all Regular Certificates
will be calculated on the basis of the
actual number of days in the related
Interest Accrual Period and a 360-day
year.
"1933 Act": The Securities Act of 1933, as amended.
"60+ Day Delinquent Loan": Each Mortgage Loan (including each
Mortgage Loan in foreclosure and each
Mortgage Loan for which the Mortgagor has
filed for bankruptcy after the Closing
Date) with respect to which any portion
of a Monthly Payment is, as of the last day
of the prior Collection Period, two
months or more past due and each Mortgage
Loan relating to an REO Property.
"Account": Any of the Collection Account, the Distribution
Account,
the Class AI Reserve Account, the Class AII
Reserve Account, the Class M Reserve
Account or the Escrow Account.
"Accrued Certificate Interest": With respect to each
Distribution
Date and Class of Certificates (other than
the Class CE, Class P and Class R
Certificates), an amount equal to the
interest accrued at the Pass-Through Rate
set forth or described for such Class in
the table in the Preliminary Statement
during the related Interest Accrual Period
on the Principal Balance of such
Class of Certificates, reduced by such
Class' Interest Percentage of any Current
Interest Shortfall Amount for such
Distribution Date.
"Adjustable Rate Mortgage Loan": A Mortgage Loan which has a rate
at
which interest accrues that adjusts based
on the applicable Index plus a related
Gross Margin, as set forth and subject to
the limitations in the related
Mortgage Note.
"Adjustment Date": With respect to each Adjustable-Rate
Mortgage
Loan, each adjustment date on which the
Mortgage Interest Rate changes pursuant
to the related Mortgage Note. The first
Adjustment Date following the applicable
Cut-off Date as to each Adjustable Rate
Mortgage Loan is set forth in the
Mortgage Loan Schedules.
"Advance": As to any Mortgage Loan, any advance made by the
Servicer
in respect of any Distribution Date
pursuant to Section 4.07 or if the Servicer
fails to make any advance, by the Trustee
pursuant to Section 7.01.
"Adverse REMIC Event": As defined in Section 9.01(f) hereof.
"Affiliate": With respect to any Person, any other Person
controlling, controlled by or under common
control with such Person. For
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 "controlling" and "controlled"
shall have meanings correlative to the
foregoing.
"Agreement": This Pooling and Servicing Agreement and all
amendments
and supplements hereto.
"Applicable Regulations": As to any Mortgage Loan, all federal,
state and local laws, statutes, rules and
regulations applicable thereto.
"Applied Realized Loss Amount": With respect to each
Distribution
Date, the excess, if any, of (a) the
aggregate of the Principal Balances of the
Certificates (after giving effect to all
distributions on such Distribution Date
and the increase of any Principal Balances
as a result of Subsequent Recoveries)
over (b) the Pool Balance as of the end of
the related Collection Period.
"Assignment": An assignment of Mortgage, notice of transfer or
equivalent instrument, in recordable form,
which is sufficient under the laws of
the jurisdiction wherein the related
Mortgaged Property is located to reflect or
record the sale of the Mortgage.
"Assumed Final Maturity Date": As to each Class of Certificates,
the
date set forth as such in the Preliminary
Statement.
"Available Funds": As to any Distribution Date, an amount equal
to
the excess of (i) the sum of: (a) the
aggregate of the Monthly Payments due
during the related Collection Period and
received on or prior to the related
Determination Date by the Servicer, (b)
Liquidation Proceeds, Insurance
Proceeds, Condemnation Proceeds, Principal
Prepayments, Substitution Adjustment
Amounts, the Purchase Price for any
repurchased Mortgage Loan, the Termination
Price with respect to the termination of
the Trust pursuant to Section 10.01
hereof and other unscheduled recoveries of
principal and interest (excluding
Prepayment Penalties, Originator Prepayment
Penalty Payment Amounts and Servicer
Prepayment Penalty Payment Amounts) in
respect of the Mortgage Loans during the
related Prepayment Period, (c) the
aggregate of any amounts received in respect
of an REO Property deposited in the
Collection Account for such Distribution
Date, (d) any Compensating Interest for
such Distribution Date, (e) the
aggregate of any Advances made by the
Servicer or the Trustee for such
Distribution Date and (f) any Reimbursement
Amount or Subsequent Recovery
deposited into the Collection Account
during the related Prepayment Period over
(ii) the sum of (a) amounts reimbursable or
payable to the Servicer pursuant to
Sections 3.05 or 6.03, (b) amounts
reimbursable or payable to the Trustee
pursuant to Section 7.01 or Section 8.05
and amounts reimbursable or payable to
the Securities Administrator pursuant to
Section 8.05 or Section 9.01(c), (c)
Stayed Funds, (d) the Servicing Fee and (e)
amounts deposited in the Collection
Account or the Distribution Account, as the
case may be, in error.
"Bankruptcy Code": Title 11 of the United States Code, as
amended.
"Balloon Loan": A Mortgage Loan that provides for the payment of
the
unamortized principal balance of such
Mortgage Loan in a single payment at the
maturity of such Mortgage Loan that is
substantially greater than the preceding
monthly payment.
"Balloon Payment": A payment of the unamortized principal balance
of
a Mortgage Loan in a single payment at the
maturity of such Mortgage Loan that
is substantially greater than the preceding
Monthly Payment.
"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 5.02 hereof). On the Closing
Date, the Class AI-1A, Class AI-1B, Class
AII-1, Class M-1, Class M-2, Class
M-3, Class M-4, Class M-5, Class M-6, Class
M-7, Class M-8, Class M-9, Class
M-10, Class M-11, Class M-12, Class M-13
and Class M-14 Certificates shall be
Book-Entry Certificates.
"Business Day": Any day other than (i) a Saturday or a Sunday
or
(ii) a legal holiday in the State of
Delaware, State of New York, the State of
Maryland, the State of Minnesota, the State
of Iowa or in the city in which the
Corporate Trust Office of the Trustee or
the Securities Administrator is located
are authorized or obligated by law or
executive order to be closed.
"Cap": Any of the Group I Cap, the Group II Cap or the Pool
Cap.
"Cap Amount": With respect to any Distribution Date and (a)
either
Class of Class AI Certificates, an amount
equal to (i) the Class AI Yield
Maintenance Agreement Payment for such
Distribution Date multiplied by (ii) a
fraction equal to (A) the Principal Balance
of such Class immediately prior to
such Distribution Date divided by (B) the
sum of the Principal Balances of the
Class AI Certificates immediately prior to
such Distribution Date; and (b) any
Class of Class M Certificates and any
Distribution Date, an amount equal to (i)
the Class M Yield Maintenance Agreement
Payment for such Distribution Date
multiplied by (ii) a fraction equal to (A)
the Principal Balance of such Class
immediately prior to such Distribution Date
divided by (B) the sum of the
Principal Balances of the Class M
Certificates immediately prior to such
Distribution Date.
"Cap Carryover Amount": If on any Distribution Date, the
Accrued
Certificate Interest for any Certificate is
based upon a Cap, the excess of (i)
the amount of interest such Certificate
would have been entitled to receive on
such Distribution Date based on the related
Formula Rate, over (ii) the amount
of interest such Certificate received on
such Distribution Date based on the
related Cap, together with the unpaid
portion of any such excess from prior
Distribution Dates (and interest accrued
thereon at the then applicable Formula
Rate on such Certificate).
"Certificate": Any Regular Certificate or Class R Certificate.
"Certificate Custodian": Initially, Wells Fargo Bank, N.A.;
thereafter any other Certificate Custodian
acceptable to the Depository and
selected by the Securities
Administrator.
"Certificate Owner": With respect to each Book-Entry
Certificate,
any beneficial owner thereof.
"Certificate Register" and "Certificate Registrar": The
register
maintained and registrar appointed pursuant
to Section 5.02 hereof.
"Certificateholder" or "Holder": The Person in whose name a
Certificate is registered in the
Certificate Register, except that a
Disqualified Organization or non-U.S.
Person shall not be a Holder of the Class
R Certificate for any purpose hereof.
"Class": Collectively, Certificates or REMIC Regular Interests
which
have the same priority of payment and bear
the same class designation and the
form of which is identical except for
variation in the Percentage Interest
evidenced thereby.
"Class A Certificate": Any one of the Class AI or Class AII-1
Certificates.
"Class A Certificateholders": Collectively, the Holders of the
Class
A Certificates.
"Class AI Certificate": Any one of the Certificates with an
"AI"
designated on the face thereof
substantially in the form annexed hereto as
Exhibits A-AI-1A and A-AI-1B, executed by
the Securities Administrator on behalf
of the Trust and authenticated and
delivered by the Certificate Registrar,
representing the right to distributions as
set forth herein and therein.
"Class AI Reserve Account": The trust account created and
maintained
by the Securities Administrator pursuant to
Section 3.04(g) which shall be
entitled "Class AI Reserve Account, Wells
Fargo Bank, N.A., as Securities
Administrator for HSBC Bank USA, National
Association, as Trustee, in trust for
registered Holders of the Class AI-1A and
Class A1-1B Certificates of Wells
Fargo Home Equity Asset-Backed Securities
2005-1 Trust, Home Equity Asset-Backed
Certificates, Series 2005-1," and which
must be an Eligible Account. Amounts on
deposit in the Class AI Reserve Account
shall not be invested. The Class AI
Reserve Account shall not be an asset of
either REMIC formed under this
Agreement.
"Class AI Yield Maintenance Agreement": The yield maintenance
agreement between the Securities
Administrator, on behalf of the Trust, and the
Yield Maintenance Agreement Provider
substantially in the form attached hereto
as Exhibit N-1. The Class AI Yield
Maintenance Agreement shall not be an asset
of either REMIC formed under this
Agreement.
"Class AI Yield Maintenance Agreement Payment": On each
Distribution
Date through the Distribution Date in April
2008, the amount equal to the
product of (a) the excess of the lesser of
(i) One-Month LIBOR and (ii) the
applicable upper strike rate for such
Distribution Date over the lower strike
rate for such Distribution Date, in each
case as set forth on the schedule
attached to the Class AI Yield Maintenance
Agreement for such Distribution Date,
(b) the notional amount as set forth on the
schedule attached to the Class AI
Yield Maintenance Agreement for such
Distribution Date and (c) a fraction, the
numerator of which is the actual number of
days elapsed since the previous
Distribution Date (or the Closing Date, in
the case of the first Distribution
Date) to but excluding the current
Distribution Date and the denominator of
which is 360.
"Class AI-1A Certificate Margin": For each Distribution Date (i)
on
or prior to the Optional Termination Date,
0.220% per annum, and (ii) following
the Optional Termination Date, 0.440% per
annum.
"Class AI-1A Formula Rate": For each Distribution Date, a rate
per
annum equal to the lesser of (a) One-Month
LIBOR as of the related LIBOR
Determination Date, plus the Class AI-1A
Certificate Margin and (b) the Group I
Maximum Rate Cap.
"Class AI-1B Certificate Margin": For each Distribution Date (i)
on
or prior to the Optional Termination Date,
0.280% per annum, and (ii) following
the Optional Termination Date, 0.560% per
annum.
"Class AI-1B Formula Rate": For each Distribution Date, a rate
per
annum equal to the lesser of (a) One-Month
LIBOR as of the related LIBOR
Determination Date, plus the Class AI-1B
Certificate Margin and (b) the Group I
Maximum Rate Cap.
"Class AII Certificate": Any one of the Certificates with an
"AII"
designated on the face thereof
substantially in the form annexed hereto as
Exhibit A-AII-1, executed by the Securities
Administrator on behalf of the Trust
and authenticated and delivered by the
Certificate Registrar, representing the
right to distributions as set forth herein
and therein.
"Class AII-1 Certificate Margin": For each Distribution Date (i)
on
or prior to the Optional Termination Date,
0.230% per annum, and (ii) following
the Optional Termination Date, 0.460% per
annum.
"Class AII-1 Formula Rate": For each Distribution Date, a rate
per
annum equal to the lesser of (a) One-Month
LIBOR as of the related LIBOR
Determination Date, plus the Class AII-1
Certificate Margin and (b) the Group II
Maximum Rate Cap.
"Class AII Reserve Account": The trust account created and
maintained by the Securities Administrator
pursuant to Section 3.04(g) which
shall be entitled "Class AII Reserve
Account, Wells Fargo Bank, N.A., as
Securities Administrator for HSBC Bank USA,
National Association, as Trustee, in
trust for registered Holders of the Class
AII Certificates of Wells Fargo Home
Equity Asset-Backed Securities 2005-1
Trust, Home Equity Asset-Backed
Certificates, Series 2005-1," and which
must be an Eligible Account. Amounts on
deposit in the Class AII Reserve Account
shall not be invested. The Class AII
Reserve Account shall not be an asset of
either REMIC formed under this
Agreement.
"Class AII Yield Maintenance Agreement": The yield maintenance
agreement between the Securities
Administrator, on behalf of the Trust, and the
Yield Maintenance Agreement Provider
substantially in the form attached hereto
as Exhibit N-2. The Class AII Yield
Maintenance Agreement shall not be an asset
of either REMIC formed under this
Agreement.
"Class AII Yield Maintenance Agreement Payment": On each
Distribution Date through the Distribution
Date in April 2008, the amount equal
to the product of (a) the excess of the
lesser of (i) One-Month LIBOR and (ii)
the applicable upper strike rate for such
Distribution Date over the applicable
lower strike rate for such Distribution
Date, in each case as set forth on the
schedule attached to the Class AII Yield
Maintenance Agreement for such
Distribution Date, (b) the notional amount
set forth on the schedule attached to
the Class AII Yield Maintenance Agreement
for such Distribution Date and (c) a
fraction, the numerator of which is the
actual number of days elapsed since the
previous Distribution Date (or the Closing
Date, in the case of the first
Distribution Date) to but excluding the
current Distribution Date and the
denominator of which is 360.
"Class CE Certificates": Any one of the Class CE Certificates
as
designated on the face thereof
substantially in the form annexed hereto as
Exhibit C-1, executed by the Securities
Administrator on behalf of the Trust and
authenticated and delivered by the
Certificate Registrar, representing the right
to distributions as set forth herein and
therein.
"Class CE Distributable Amount": With respect to any
Distribution
Date, the sum of (i) the interest accrued
on such Class CE Certificate at its
Pass-Through Rate calculated on its
Notional Amount less the amount (without
duplication) of Cap Carryover Amounts paid
pursuant to Section 4.02(b)(xlv),
(ii) any remaining Overcollateralization
Release Amounts and (iii) the aggregate
of amounts remaining in the Reserve
Accounts after the distributions in Section
3.04(g)(i) through (v).
"Class M Certificate": Any one of the Certificates with an "M"
designated on the face thereof
substantially in the form annexed hereto as
Exhibit B-1, Exhibit B-2, Exhibit B-3,
Exhibit B-4, Exhibit B-5, Exhibit B-6,
Exhibit B-7, Exhibit B-8, Exhibit B-9,
Exhibit B-10, Exhibit B-11, Exhibit B-12,
Exhibit B-13 and Exhibit B-14, executed by
the Securities Administrator on
behalf of the Trust and authenticated and
delivered by the Certificate
Registrar, representing the right to
distributions as set forth herein and
therein.
"Class M Certificateholders": Collectively, the Holders of the
Class
M Certificates.
"Class M-1 Certificate Margin": For each Distribution Date (i) on
or
prior to the Optional Termination Date,
0.410% per annum, and (ii) following the
Optional Termination Date, 0.615% per
annum.
"Class M-1 Formula Rate": For each Distribution Date, a rate
per
annum equal to the lesser of (a) One-Month
LIBOR as of the related LIBOR
Determination Date, plus the Class M-1
Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-1 Principal Distribution Amount": As of any
Distribution
Date on or after the Stepdown Date and as
long as a Trigger Event is not in
effect, the excess of (x) the sum of (i)
the Principal Balances of the Class A
Certificates (after taking into account the
payment of the Senior Principal
Distribution Amount on such Distribution
Date) and (ii) the Principal Balance of
the Class M-1 Certificates immediately
prior to such Distribution Date over (y)
the lesser of (A) the product of (i)
72.499936336094% and (ii) the Pool Balance
as of the last day of the related
Collection Period and (B) the
Overcollateralization Floor.
"Class M-1 Realized Loss Amortization Amount": As to the Class
M-1
Certificates and as of any Distribution
Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-1
Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly
Excess Cashflow Amount over (ii) the sum
of the amounts described in Section
4.02(b)(i) through (iv) hereof, in each case
for such Distribution Date.
"Class M-2 Certificate Margin": For each Distribution Date (i) on
or
prior to the Optional Termination Date,
0.430% per annum, and (ii) following the
Optional Termination Date, 0.645% per
annum.
"Class M-2 Formula Rate": For each Distribution Date, a rate
per
annum equal to the lesser of (a) One-Month
LIBOR as of the related LIBOR
Determination Date, plus the Class M-2
Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-2 Principal Distribution Amount": As of any
Distribution
Date on or after the Stepdown Date and as
long as a Trigger Event is not in
effect, the excess of (x) the sum of (i)
the Principal Balances of the Class A
Certificates (after taking into account the
payment of the Senior Principal
Distribution Amount on such Distribution
Date), (ii) the Principal Balance of
the Class M-1 Certificates (after taking
into account the payment of the Class
M-1 Principal Distribution Amount on such
Distribution Date) and (iii) the
Principal Balance of the Class M-2
Certificates immediately prior to such
Distribution Date over (y) the lesser of
(A) the product of (i) 77.300077927268%
and (ii) the Pool Balance as of the last
day of the related Collection Period
and (B) the Overcollateralization
Floor.
"Class M-2 Realized Loss Amortization Amount": As to the Class
M-2
Certificates and as of any Distribution
Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-2
Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly
Excess Cashflow Amount over (ii) the sum
of the amounts described in Section
4.02(b)(i) through (vii) hereof, in each
case for such Distribution Date.
"Class M-3 Certificate Margin": For each Distribution Date (i) on
or
prior to the Optional Termination Date,
0.480% per annum, and (ii) following the
Optional Termination Date, 0.720% per
annum.
"Class M-3 Formula Rate": For each Distribution Date, the lesser
of
a rate per annum equal to (a) One-Month
LIBOR as of the related LIBOR
Determination Date, plus the Class M-3
Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-3 Principal Distribution Amount": As of any
Distribution
Date on or after the Stepdown Date and as
long as a Trigger Event is not in
effect, the excess of (x) the sum of (i)
the sum of the Principal Balances of
the Class A Certificates (after taking into
account the payment of the Senior
Principal Distribution Amount on such
Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates
(after taking into account the payment of
the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii)
the Principal Balance of the Class M-2
Certificates (after taking into account
the payment of the Class M-2 Principal
Distribution Amount on such Distribution
Date), and (iv) the Principal Balance of
the Class M-3 Certificates immediately
prior to such Distribution Date over (y)
the lesser of (A) the product of (i)
80.200067267406% and (ii) the Pool Balance
as of the last day of the related
Collection Period and (B) the
Overcollateralization Floor.
"Class M-3 Realized Loss Amortization Amount": As to the Class
M-3
Certificates and as of any Distribution
Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-3
Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly
Excess Cashflow Amount over (ii) the sum
of the amounts described in Section
4.02(b)(i) through (x) hereof, in each case
for such Distribution Date.
"Class M-4 Certificate Margin": For each Distribution Date (i) on
or
prior to the Optional Termination Date,
0.610% per annum, and (ii) following the
Optional Termination Date, 0.915% per
annum.
"Class M-4 Formula Rate": For each Distribution Date, the lesser
of
a rate per annum equal to (a) One-Month
LIBOR as of the related LIBOR
Determination Date, plus the Class M-4
Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-4 Principal Distribution Amount": As of any
Distribution
Date on or after the Stepdown Date and as
long as a Trigger Event is not in
effect, the excess of (x) the sum of (i)
the sum of the Principal Balances of
the Class A Certificates (after taking into
account the payment of the Senior
Principal Distribution Amount on such
Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates
(after taking into account the payment of
the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii)
the Principal Balance of the Class M-2
Certificates (after taking into account
the payment of the Class M-2 Principal
Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the
Class M-3 Certificates (after taking
into account the payment of the Class M-3
Principal Distribution Amount on such
Distribution Date) and (v) the Principal
Balance of the Class M-4 Certificates
immediately prior to such Distribution Date
over (y) the lesser of (A) the
product of (i) 82.700058077869% and (ii)
the Pool Balance as of the last day of
the related Collection Period and (B) the
Overcollateralization Floor.
"Class M-4 Realized Loss Amortization Amount": As to the Class
M-4
Certificates and as of any Distribution
Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-4
Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly
Excess Cashflow Amount over (ii) the sum
of the amounts described in Section
4.02(b)(i) through (xiii) hereof, in each
case for such Distribution Date.
"Class M-5 Certificate Margin": For each Distribution Date (i) on
or
prior to the Optional Termination Date,
0.630% per annum, and (ii) following the
Optional Termination Date, 0.945% per
annum.
"Class M-5 Formula Rate": For each Distribution Date, the lesser
of
a rate per annum equal to (a) One-Month
LIBOR as of the related LIBOR
Determination Date, plus the Class M-5
Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-5 Principal Distribution Amount": As of any
Distribution
Date on or after the Stepdown Date and as
long as a Trigger Event is not in
effect, the excess of (x) the sum of (i)
the sum of the Principal Balances of
the Class A Certificates (after taking into
account the payment of the Senior
Principal Distribution Amount on such
Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates
(after taking into account the payment of
the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii)
the Principal Balance of the Class M-2
Certificates (after taking into account
the payment of the Class M-2 Principal
Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the
Class M-3 Certificates (after taking
into account the payment of the Class M-3
Principal Distribution Amount on such
Distribution Date), (v) the Principal
Balance of the Class M-4 Certificates
(after taking into account the payment of
the Class M-4 Principal Distribution
Amount on such Distribution Date) and (vi)
the Principal Balance of the Class
M-5 Certificates immediately prior to such
Distribution Date over (y) the lesser
of (A) the product of (i) 85.000049623496%
and (ii) the Pool Balance as of the
last day of the related Collection Period
and (B) the Overcollateralization
Floor.
"Class M-5 Realized Loss Amortization Amount": As to the Class
M-5
Certificates and as of any Distribution
Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-5
Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly
Excess Cashflow Amount over (ii) the sum
of the amounts described in Section
4.02(b)(i) through (xvi) hereof, in each
case for such Distribution Date.
"Class M-6 Certificate Margin": For each Distribution Date (i) on
or
prior to the Optional Termination Date,
0.660% per annum, and (ii) following the
Optional Termination Date, 0.990% per
annum.
"Class M-6 Formula Rate": For each Distribution Date, the lesser
of
a rate per annum equal to (a) One-Month
LIBOR as of the related LIBOR
Determination Date, plus the Class M-6
Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-6 Principal Distribution Amount": As of any
Distribution
Date on or after the Stepdown Date and as
long as a Trigger Event is not in
effect, the excess of (x) the sum of (i)
the sum of the Principal Balances of
the Class A Certificates (after taking into
account the payment of the Senior
Principal Distribution Amount on such
Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates
(after taking into account the payment of
the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii)
the Principal Balance of the Class M-2
Certificates (after taking into account
the payment of the Class M-2 Principal
Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the
Class M-3 Certificates (after taking
into account the payment of the Class M-3
Principal Distribution Amount on such
Distribution Date), (v) the Principal
Balance of the Class M-4 Certificates
(after taking into account the payment of
the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the
Principal Balance of the Class M-5
Certificates (after taking into account the
payment of the Class M-5 Principal
Distribution Amount on such Distribution
Date) and (vii) the Principal Balance
of the Class M-6 Certificates immediately
prior to such Distribution Date over
(y) the lesser of (A) the product of (i)
87.000042271867% and (ii) the Pool
Balance as of the last day of the related
Collection Period and (B) the
Overcollateralization Floor.
"Class M-6 Realized Loss Amortization Amount": As to the Class
M-6
Certificates and as of any Distribution
Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-6
Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly
Excess Cashflow Amount over (ii) the sum
of the amounts described in Section
4.02(b)(i) through (xix) hereof, in each
case for such Distribution Date.
"Class M-7 Certificate Margin": For each Distribution Date (i) on
or
prior to the Optional Termination Date,
1.050% per annum, and (ii) following the
Optional Termination Date, 1.575% per
annum.
"Class M-7 Formula Rate": For each Distribution Date, the lesser
of
a rate per annum equal to (a) One-Month
LIBOR as of the related LIBOR
Determination Date, plus the Class M-7
Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-7 Principal Distribution Amount": As of any
Distribution
Date on or after the Stepdown Date and as
long as a Trigger Event is not in
effect, the excess of (x) the sum of (i)
the sum of the Principal Balances of
the Class A Certificates (after taking into
account the payment of the Senior
Principal Distribution Amount on such
Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates
(after taking into account the payment of
the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii)
the Principal Balance of the Class M-2
Certificates (after taking into account
the payment of the Class M-2 Principal
Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the
Class M-3 Certificates (after taking
into account the payment of the Class M-3
Principal Distribution Amount on such
Distribution Date), (v) the Principal
Balance of the Class M-4 Certificates
(after taking into account the payment of
the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the
Principal Balance of the Class M-5
Certificates (after taking into account the
payment of the Class M-5 Principal
Distribution Amount on such Distribution
Date), (vii) the Principal Balance of
the Class M-6 Certificates (after taking
into account the payment of the Class
M-6 Principal Distribution Amount on such
Distribution Date) and (viii) the
Principal Balance of the Class M-7
Certificates immediately prior to such
Distribution Date over (y) the lesser of
(A) the product of (i) 89.000034920238%
and (ii) the Pool Balance as of the last
day of the related Collection Period
and (B) the Overcollateralization
Floor.
"Class M-7 Realized Loss Amortization Amount": As to the Class
M-7
Certificates and as of any Distribution
Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-7
Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly
Excess Cashflow Amount over (ii) the sum
of the amounts described in Section
4.02(b)(i) through (xxii) hereof, in each
case for such Distribution Date.
"Class M-8 Certificate Margin": For each Distribution Date (i) on
or
prior to the Optional Termination Date,
1.150% per annum, and (ii) following the
Optional Termination Date, 1.725% per
annum.
"Class M-8 Formula Rate": For each Distribution Date, the lesser
of
a rate per annum equal to (a) One-Month
LIBOR as of the related LIBOR
Determination Date, plus the Class M-8
Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-8 Principal Distribution Amount": As of any
Distribution
Date on or after the Stepdown Date and as
long as a Trigger Event is not in
effect, the excess of (x) the sum of (i)
the sum of the Principal Balances of
the Class A Certificates (after taking into
account the payment of the Senior
Principal Distribution Amount on such
Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates
(after taking into account the payment of
the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii)
the Principal Balance of the Class M-2
Certificates (after taking into account
the payment of the Class M-2 Principal
Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the
Class M-3 Certificates (after taking
into account the payment of the Class M-3
Principal Distribution Amount on such
Distribution Date), (v) the Principal
Balance of the Class M-4 Certificates
(after taking into account the payment of
the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the
Principal Balance of the Class M-5
Certificates (after taking into account the
payment of the Class M-5 Principal
Distribution Amount on such Distribution
Date), (vii) the Principal Balance of
the Class M-6 Certificates (after taking
into account the payment of the Class
M-6 Principal Distribution Amount on such
Distribution Date), (vii) the
Principal Balance of the Class M-7
Certificates (after taking into account the
payment of the Class M-7 Principal
Distribution Amount on such Distribution
Date) and (viii) the Principal Balance of
the Class M-8 Certificates immediately
prior to such Distribution Date over (y)
the lesser of (A) the product of (i)
90.400029774098% and (ii) the Pool Balance
as of the last day of the related
Collection Period and (B) the
Overcollateralization Floor.
"Class M-8 Realized Loss Amortization Amount": As to the Class
M-8
Certificates and as of any Distribution
Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-8
Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly
Excess Cashflow Amount over (ii) the sum
of the amounts described in Section
4.02(b)(i) through (xxv) hereof, in each
case for such Distribution Date.
"Class M-9 Certificate Margin": For each Distribution Date (i) on
or
prior to the Optional Termination Date,
1.700% per annum, and (ii) following the
Optional Termination Date, 2.550% per
annum.
"Class M-9 Formula Rate": For each Distribution Date, the lesser
of
a rate per annum equal to (a) One-Month
LIBOR as of the related LIBOR
Determination Date, plus the Class M-9
Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-9 Principal Distribution Amount": As of any
Distribution
Date on or after the Stepdown Date and as
long as a Trigger Event is not in
effect, the excess of (x) the sum of (i)
the sum of the Principal Balances of
the Class A Certificates (after taking into
account the payment of the Senior
Principal Distribution Amount on such
Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates
(after taking into account the payment of
the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii)
the Principal Balance of the Class M-2
Certificates (after taking into account
the payment of the Class M-2 Principal
Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the
Class M-3 Certificates (after taking
into account the payment of the Class M-3
Principal Distribution Amount on such
Distribution Date), (v) the Principal
Balance of the Class M-4 Certificates
(after taking into account the payment of
the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the
Principal Balance of the Class M-5
Certificates (after taking into account the
payment of the Class M-5 Principal
Distribution Amount on such Distribution
Date), (vii) the Principal Balance of
the Class M-6 Certificates (after taking
into account the payment of the Class
M-6 Principal Distribution Amount on such
Distribution Date), (viii) the
Principal Balance of the Class M-7
Certificates (after taking into account the
payment of the Class M-7 Principal
Distribution Amount on such Distribution
Date), (ix) the sum of the Principal
Balances of the Class M-8 Certificates
(after taking into account the payment of
the Class M-8 Principal Distribution
Amount on such Distribution Date) and (x)
the Principal Balance of the Class M-9
Certificates immediately prior to such
Distribution Date over (y) the lesser of
(A) the product of (i) 92.400022422469% and
(ii) the Pool Balance as of the last
day of the related Collection Period and
(B) the Overcollateralization Floor.
"Class M-9 Realized Loss Amortization Amount": As to the Class
M-9
Certificates and as of any Distribution
Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-9
Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly
Excess Cashflow Amount over (ii) the sum
of the amounts described in Section
4.02(b)(i) through (xxviii) hereof, in each
case for such Distribution Date.
"Class M-10 Certificate Margin": For each Distribution Date (i)
on
or prior to the Optional Termination Date,
2.500% per annum, and (ii) following
the Optional Termination Date, 3.750% per
annum.
"Class M-10 Formula Rate": For each Distribution Date, the lesser
of
a rate per annum equal to (a) One-Month
LIBOR as of the related LIBOR
Determination Date, plus the Class M-10
Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-10 Principal Distribution Amount": As of any
Distribution
Date on or after the Stepdown Date and as
long as a Trigger Event is not in
effect, the excess of (x) the sum of (i)
the sum of the Principal Balances of
the Class A Certificates (after taking into
account the payment of the Senior
Principal Distribution Amount on such
Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates
(after taking into account the payment of
the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii)
the Principal Balance of the Class M-2
Certificates (after taking into account
the payment of the Class M-2 Principal
Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the
Class M-3 Certificates (after taking
into account the payment of the Class M-3
Principal Distribution Amount on such
Distribution Date), (v) the Principal
Balance of the Class M-4 Certificates
(after taking into account the payment of
the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the
Principal Balance of the Class M-5
Certificates (after taking into account the
payment of the Class M-5 Principal
Distribution Amount on such Distribution
Date), (vii) the Principal Balance of
the Class M-6 Certificates (after taking
into account the payment of the Class
M-6 Principal Distribution Amount on such
Distribution Date), (viii) the
Principal Balance of the Class M-7
Certificates (after taking into account the
payment of the Class M-7 Principal
Distribution Amount on such Distribution
Date), (ix) the Principal Balance of the
Class M-8 Certificates (after taking
into account the payment of the Class M-8
Principal Distribution Amount on such
Distribution Date), (x) the Principal
Balance of the Class M-9 Certificates
(after taking into account the payment of
the Class M-9 Principal Distribution
Amount on such Distribution Date) and (xi)
the Principal Balance of the Class
M-10 Certificates immediately prior to such
Distribution Date over (y) the
lesser of (A) the product of (i)
94.400015070840% and (ii) the Pool Balance as
of the last day of the related Collection
Period and (B) the
Overcollateralization Floor.
"Class M-10 Realized Loss Amortization Amount": As to the Class
M-10
Certificates and as of any Distribution
Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-10
Certificates as of such Distribution
Date and (y) the excess of (i) the Monthly
Excess Cashflow Amount over (ii) the
sum of the amounts described in Section
4.02(b)(i) through (xxxi) hereof, in
each case for such Distribution Date.
"Class M-11 Certificate Margin": For each Distribution Date (i)
on
or prior to the Optional Termination Date,
2.500% per annum, and (ii) following
the Optional Termination Date, 3.750% per
annum.
"Class M-11 Formula Rate": For each Distribution Date, the lesser
of
a rate per annum equal to (a) One-Month
LIBOR as of the related LIBOR
Determination Date, plus the Class M-11
Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-11 Principal Distribution Amount": As of any
Distribution
Date on or after the Stepdown Date and as
long as a Trigger Event is not in
effect, the excess of (x) the sum of (i)
the sum of the Principal Balances of
the Class A Certificates (after taking into
account the payment of the Senior
Principal Distribution Amount on such
Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates
(after taking into account the payment of
the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii)
the Principal Balance of the Class M-2
Certificates (after taking into account
the payment of the Class M-2 Principal
Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the
Class M-3 Certificates (after taking
into account the payment of the Class M-3
Principal Distribution Amount on such
Distribution Date), (v) the Principal
Balance of the Class M-4 Certificates
(after taking into account the payment of
the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the
Principal Balance of the Class M-5
Certificates (after taking into account the
payment of the Class M-5 Principal
Distribution Amount on such Distribution
Date), (vii) the Principal Balance of
the Class M-6 Certificates (after taking
into account the payment of the Class
M-6 Principal Distribution Amount on such
Distribution Date), (viii) the
Principal Balance of the Class M-7
Certificates (after taking into account the
payment of the Class M-7 Principal
Distribution Amount on such Distribution
Date), (ix) the Principal Balances of the
Class M-8 Certificates (after taking
into account the payment of the Class M-8
Principal Distribution Amount on such
Distribution Date), (x) the Principal
Balance of the Class M-9 Certificates
(after taking into account the payment of
the Class M-9 Principal Distribution
Amount on such Distribution Date), (xi) the
Principal Balance of the Class M-10
Certificates (after taking into account the
payment of the Class M-10 Principal
Distribution Amount on such Distribution
Date) and (xii) the Principal Balance
of the Class M-11 Certificates immediately
prior to such Distribution Date over
(y) the lesser of (A) the product of (i)
95.600010659862% and (ii) the Pool
Balance as of the last day of the related
Collection Period and (B) the
Overcollateralization Floor.
"Class M-11 Realized Loss Amortization Amount": As to the Class
M-11
Certificates and as of any Distribution
Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-11
Certificates as of such Distribution
Date and (y) the excess of (i) the Monthly
Excess Cashflow Amount over (ii) the
sum of the amounts described in Section
4.02(b)(i) through (xxxiv) hereof, in
each case for such Distribution Date.
"Class M-12 Certificate Margin": For each Distribution Date (i)
on
or prior to the Optional Termination Date,
2.500% per annum, and (ii) following
the Optional Termination Date, 3.750% per
annum.
"Class M-12 Formula Rate": For each Distribution Date, the lesser
of
a rate per annum equal to (a) One-Month
LIBOR as of the related LIBOR
Determination Date, plus the Class M-12
Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-12 Principal Distribution Amount": As of any
Distribution
Date on or after the Stepdown Date and as
long as a Trigger Event is not in
effect, the excess of (x) the sum of (i)
the sum of the Principal Balances of
the Class A Certificates (after taking into
account the payment of the Senior
Principal Distribution Amount on such
Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates
(after taking into account the payment of
the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii)
the Principal Balance of the Class M-2
Certificates (after taking into account
the payment of the Class M-2 Principal
Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the
Class M-3 Certificates (after taking
into account the payment of the Class M-3
Principal Distribution Amount on such
Distribution Date), (v) the Principal
Balance of the Class M-4 Certificates
(after taking into account the payment of
the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the
Principal Balance of the Class M-5
Certificates (after taking into account the
payment of the Class M-5 Principal
Distribution Amount on such Distribution
Date), (vii) the Principal Balance of
the Class M-6 Certificates (after taking
into account the payment of the Class
M-6 Principal Distribution Amount on such
Distribution Date), (viii) the
Principal Balance of the Class M-7
Certificates (after taking into account the
payment of the Class M-7 Principal
Distribution Amount on such Distribution
Date), (ix) the Principal Balances of the
Class M-8 Certificates (after taking
into account the payment of the Class M-8
Principal Distribution Amount on such
Distribution Date), (x) the Principal
Balance of the Class M-9 Certificates
(after taking into account the payment of
the Class M-9 Principal Distribution
Amount on such Distribution Date), (xi) the
Principal Balance of the Class M-10
Certificates (after taking into account the
payment of the Class M-10 Principal
Distribution Amount on such Distribution
Date), (xii) the Principal Balance of
the Class M-11 Certificates (after taking
into account the payment of the Class
M-11 Principal Distribution Amount on such
Distribution Date) and (xiii) the
Principal Balance of the Class M-12
Certificates immediately prior to such
Distribution Date over (y) the lesser of
(A) the product of (i) 97.100005146140%
and (ii) the Pool Balance as of the last
day of the related Collection Period
and (B) the Overcollateralization
Floor.
"Class M-12 Realized Loss Amortization Amount": As to the Class
M-12
Certificates and as of any Distribution
Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-12
Certificates as of such Distribution
Date and (y) the excess of (i) the Monthly
Excess Cashflow Amount over (ii) the
sum of the amounts described in Section
4.02(b)(i) through (xxxvii) hereof, in
each case for such Distribution Date.
"Class M-13 Certificate Margin": For each Distribution Date (i)
on
or prior to the Optional Termination Date,
2.500% per annum, and (ii) following
the Optional Termination Date, 3.750% per
annum.
"Class M-13 Formula Rate": For each Distribution Date, the lesser
of
a rate per annum equal to (a) One-Month
LIBOR as of the related LIBOR
Determination Date, plus the Class M-13
Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-13 Principal Distribution Amount": As of any
Distribution
Date on or after the Stepdown Date and as
long as a Trigger Event is not in
effect, the excess of (x) the sum of (i)
the sum of the Principal Balances of
the Class A Certificates (after taking into
account the payment of the Senior
Principal Distribution Amount on such
Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates
(after taking into account the payment of
the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii)
the Principal Balance of the Class M-2
Certificates (after taking into account
the payment of the Class M-2 Principal
Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the
Class M-3 Certificates (after taking
into account the payment of the Class M-3
Principal Distribution Amount on such
Distribution Date), (v) the Principal
Balance of the Class M-4 Certificates
(after taking into account the payment of
the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the
Principal Balance of the Class M-5
Certificates (after taking into account the
payment of the Class M-5 Principal
Distribution Amount on such Distribution
Date), (vii) the Principal Balance of
the Class M-6 Certificates (after taking
into account the payment of the Class
M-6 Principal Distribution Amount on such
Distribution Date), (viii) the
Principal Balance of the Class M-7
Certificates (after taking into account the
payment of the Class M-7 Principal
Distribution Amount on such Distribution
Date), (ix) the Principal Balances of the
Class M-8 Certificates (after taking
into account the payment of the Class M-8
Principal Distribution Amount on such
Distribution Date), (x) the Principal
Balance of the Class M-9 Certificates
(after taking into account the payment of
the Class M-9 Principal Distribution
Amount on such Distribution Date), (xi) the
Principal Balance of the Class M-10
Certificates (after taking into account the
payment of the Class M-10 Principal
Distribution Amount on such Distribution
Date), (xii) the Principal Balance of
the Class M-11 Certificates (after taking
into account the payment of the Class
M-11 Principal Distribution Amount on such
Distribution Date), (xiii) the
Principal Balance of the Class M-12
Certificates (after taking into account the
payment of the Class M-12 Principal
Distribution Amount on such Distribution
Date) and (xiv) the Principal Balance of
the Class M-13 Certificates immediately
prior to such Distribution Date over (y)
the lesser of (A) the product of (i)
97.900002205489% and (ii) the Pool Balance
as of the last day of the related
Collection Period and (B) the
Overcollateralization Floor.
"Class M-13 Realized Loss Amortization Amount": As to the Class
M-13
Certificates and as of any Distribution
Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-13
Certificates as of such Distribution
Date and (y) the excess of (i) the Monthly
Excess Cashflow Amount over (ii) the
sum of the amounts described in Section
4.02(b)(i) through (xl) hereof, in each
case for such Distribution Date.
"Class M-14 Certificate Margin": For each Distribution Date (i)
on
or prior to the Optional Termination Date,
2.400% per annum, and (ii) following
the Optional Termination Date, 3.600% per
annum.
"Class M-14 Formula Rate": For each Distribution Date, the lesser
of
a rate per annum equal to (a) One-Month
LIBOR as of the related LIBOR
Determination Date, plus the Class M-14
Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-14 Principal Distribution Amount": As of any
Distribution
Date on or after the Stepdown Date and as
long as a Trigger Event is not in
effect, the excess of (x) the sum of (i)
the sum of the Principal Balances of
the Class A Certificates (after taking into
account the payment of the Senior
Principal Distribution Amount on such
Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates
(after taking into account the payment of
the Class M-1 Principal Distribution Amount
on such Distribution Date), (iii)
the Principal Balance of the Class M-2
Certificates (after taking into account
the payment of the Class M-2 Principal
Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the
Class M-3 Certificates (after taking
into account the payment of the Class M-3
Principal Distribution Amount on such
Distribution Date), (v) the Principal
Balance of the Class M-4 Certificates
(after taking into account the payment of
the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the
Principal Balance of the Class M-5
Certificates (after taking into account the
payment of the Class M-5 Principal
Distribution Amount on such Distribution
Date), (vii) the Principal Balance of
the Class M-6 Certificates (after taking
into account the payment of the Class
M-6 Principal Distribution Amount on such
Distribution Date), (viii) the
Principal Balance of the Class M-7
Certificates (after taking into account the
payment of the Class M-7 Principal
Distribution Amount on such Distribution
Date), (ix) the Principal Balances of the
Class M-8 Certificates (after taking
into account the payment of the Class M-8
Principal Distribution Amount on such
Distribution Date), (x) the Principal
Balance of the Class M-9 Certificates
(after taking into account the payment of
the Class M-9 Principal Distribution
Amount on such Distribution Date), (xi) the
Principal Balance of the Class M-10
Certificates (after taking into account the
payment of the Class M-10 Principal
Distribution Amount on such Distribution
Date), (xii) the Principal Balance of
the Class M-11 Certificates (after taking
into account the payment of the Class
M-11 Principal Distribution Amount on such
Distribution Date), (xiii) the
Principal Balance of the Class M-12
Certificates (after taking into account the
payment of the Class M-12 Principal
Distribution Amount on such Distribution
Date), (xiv) the Principal Balance of the
Class M-13 Certificates (after taking
into account the payment of the Class M-13
Principal Distribution Amount on such
Distribution Date) and (xv) the Principal
Balance of the Class M-14 Certificates
immediately prior to such Distribution Date
over (y) the lesser of (A) the
product of (i) 98.500000000000% and (ii)
the Pool Balance as of the last day of
the related Collection Period and (B) the
Overcollateralization Floor.
"Class M-14 Realized Loss Amortization Amount": As to the Class
M-14
Certificates and as of any Distribution
Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-14
Certificates as of such Distribution
Date and (y) the excess of (i) the Monthly
Excess Cashflow Amount over (ii) the
sum of the amounts described in Section
4.02(b)(i) through (xliii) hereof, in
each case for such Distribution Date.
"Class M Reserve Account": The trust account created and
maintained
by the Securities Administrator pursuant to
Section 3.04(g) which shall be
entitled "Class M Reserve Account, Wells
Fargo Bank, N.A., as Securities
Administrator for HSBC Bank USA, National
Association, as Trustee, in trust for
registered Holders of the Class M
Certificates of Wells Fargo Home Equity
Asset-Backed Securities 2005-1 Trust, Home
Equity Asset-Backed Certificates,
Series 2005-1," and which must be an
Eligible Account. Amounts on deposit in the
Class M Reserve Account shall not be
invested. The Class M Reserve Account shall
not be an asset of either REMIC formed
under this Agreement.
"Class M Yield Maintenance Agreement": The yield maintenance
agreement between the Securities
Administrator, on behalf of the Trust, and the
Yield Maintenance Agreement Provider
substantially in the form attached hereto
as Exhibit N-3. The Class M Yield
Maintenance Agreement shall not be an asset of
either REMIC formed under this
Agreement.
"Class M Yield Maintenance Agreement Payment": On each
Distribution
Date through the Distribution Date in April
2008, the amount equal to the
product of (a) the excess of the lesser of
(i) One-Month LIBOR and (ii) the
applicable upper strike rate for such
Distribution Date over the lower strike
rate for such Distribution Date, in each
case as set forth on the schedule
attached to the Class M Yield Maintenance
Agreement for such Distribution Date,
(b) the notional amount as set forth on the
schedule attached to the Class M
Yield Maintenance Agreement for such
Distribution Date and (c) a fraction, the
numerator of which is the actual number of
days elapsed since the previous
Distribution Date (or the Closing Date, in
the case of the first Distribution
Date) to but excluding the current
Distribution Date and the denominator of
which is 360.
"Class P Certificate": Any one of the Certificates with a "P"
designated on the face thereof
substantially in the form annexed hereto as
Exhibit C-2, executed by the Securities
Administrator on behalf of the Trust and
authenticated and delivered by the
Certificate Registrar, representing the right
to distributions as set forth herein and
therein.
"Class R Certificate": The Class R Certificate executed by the
Securities Administrator on behalf of the
Trust, and authenticated and delivered
by the Certificate Registrar, substantially
in the form annexed hereto as
Exhibit C-3 and evidencing the ownership of
the Residual Interest in each of
REMIC 1 and REMIC 2. The Class R
Certificate represents the ownership of the
Class R-1 Interest and the Class R-2
Interest.
"Class R-1 Interest": The uncertificated residual interest in
REMIC
1.
"Class R-2 Interest": The uncertificated residual interest in
REMIC
2.
"Closing Date": June 29, 2005.
"Code": The Internal Revenue Code of 1986, as it may be amended
from
time to time.
"Collection Account": The account or accounts created and
maintained
by the Servicer pursuant to Section
3.04(a), which shall be entitled "Collection
Account, Wells Fargo Bank, N.A., as
Servicer for HSBC Bank USA, National
Association, as Trustee, in trust for
registered Holders of Wells Fargo Home
Equity Asset-Backed Securities 2005-1
Trust, Home Equity Asset-Backed
Certificates, Series 2005-1," and which
must be an Eligible Account.
"Collection Period": With respect to any Distribution Date, the
period from the second day of the calendar
month preceding the month in which
such Distribution Date occurs through the
first day of the month in which such
Distribution Date occurs.
"Commission": The United States Securities and Exchange
Commission.
"Compensating Interest": As defined in Section 3.22 hereof.
"Condemnation Proceeds": All awards or settlements in respect of
a
taking of a Mortgaged Property by exercise
of the power of eminent domain or
condemnation.
"Corporate Trust Office": With respect to the Trustee, the
principal
corporate trust office of the Trustee at
which at any particular time its
corporate trust business in connection with
this Agreement shall be
administered, which office at the date of
the execution of this instrument is
located at 452 Fifth Avenue, New York, New
York 10018, Attention: WFHET 2005-1
or at such other address as the Trustee may
designate from time to time by
notice to the Certificateholders, the
Depositor, the Securities Administrator
and the Servicer. With respect to the
Securities Administrator, the corporate
trust office of the Securities
Administrator at which at any particular time its
corporate trust business in connection with
this Agreement shall be
administered, which office at the date of
the execution of this instrument is
located at (i) for certificate transfer
purposes, Wells Fargo Center, Sixth
Street and Marquette Avenue, Minneapolis,
Minnesota, 55479-0113, Attention:
Client Manager-WFHET, Series 2005-1 and
(ii) for all other purposes, 9062 Old
Annapolis Road, Columbia, Maryland 21045,
Attention: Client Manager-WFHET,
Series 2005-1 or at such other address as
the Securities Administrator may
designate from time to time by notice to
the Certificateholders, the Depositor,
the Trustee and the Servicer.
"Corresponding Classes": With respect to REMIC 1 and REMIC 2,
the
following Classes shall be Corresponding
Classes:
Corresponding REMIC 1 Classes Corresponding REMIC 2
Classes
-----------------------------
-----------------------------
LT1AI1A
Class AI-1A Certificates
LT1AI1B
Class AI-1B Certificates
LT1AII1
Class AII-I Certificates
LT1M1
Class M-1 Certificates
LT1M2
Class M-2 Certificates
LT1M3
Class M-3 Certificates
LT1M4
Class M-4 Certificates
LT1M5
Class M-5 Certificates
LT1M6
Class M-6 Certificates
LT1M7
Class M-7 Certificates
LT1M8
Class M-8 Certificates
LT1M9
Class M-9 Certificates
LT1M10
Class M-10 Certificates
LT1M11
Class M-11 Certificates
LT1M12
Class M-12 Certificates
LT1M13
Class M-13 Certificates
LT1M14
Class M-14 Certificates
"Credit Risk Management Agreement": The Credit Risk Management
Agreement between the Servicer and the
Credit Risk Manager dated June 29, 2005.
"Credit Risk Manager": The Murrayhill Company, a Colorado
corporation.
"Current Interest Shortfall": With respect to any Distribution
Date,
the sum of (i) the aggregate amount of
Relief Act Shortfalls, (ii) the aggregate
amount of Prepayment Interest Shortfalls
attributable to partial Principal
Prepayments and (iii) the amount, if any,
by which (x) the aggregate amount of
Prepayment Interest Shortfalls attributable
to Principal Prepayments in full
exceeds (y) the Compensating Interest for
such Distribution Date.
"Credit Risk Manager Fee": The fee payable to the Credit Risk
Manager on each Distribution Date for its
services as Credit Risk Manager, in an
amount equal to the product of (i)
one-twelfth of the Credit Risk Manager Fee
Rate and (ii) the Pool Balance as of the
opening of business on the first day of
the related Collection Period.
"Credit Risk Manager Fee Rate": With respect to any
Distribution
Date, 0.015% per annum.
"Custodial Agreement": That certain Custodial Agreement, dated as
of
June 29, 2005, among the Custodian, the
Depositor, the Servicer and the Trustee.
"Custodian": Wells Fargo Bank, N.A., as custodian pursuant to
the
Custodial Agreement, and any successor
custodian, if any, hereafter appointed by
the Trustee pursuant to Section 8.16. The
Custodian may (but need not) be the
Trustee, the Securities Administrator or
the Servicer or any Person directly or
indirectly controlling or controlled by or
under common control of any of them.
"Cut-off Date": With respect to each Mortgage Loan, the Due
Date
occurring in June 2005.
"Cut-off Date Aggregate Principal Balance": The aggregate of
the
Cut-off Date Principal Balances of the
Mortgage Loans.
"Cut-off Date Principal Balance": With respect to any Mortgage
Loan,
the unpaid principal balance thereof as of
the applicable Cut-off Date after
giving effect to any Monthly Payment due on
such date and to the application of
funds received or advanced on or before
such date (or as of the applicable date
of substitution with respect to an Eligible
Substitute Mortgage Loan).
"Debt Service Reduction": With respect to any Mortgage Loan, a
reduction in the scheduled Monthly Payment
for such Mortgage Loan by a court of
competent jurisdiction in a proceeding
under the Bankruptcy Code, except such a
reduction resulting from a Deficient
Valuation.
"Defective Mortgage Loan": A Mortgage Loan replaced or to be
replaced by one or more Eligible Substitute
Mortgage Loans.
"Deficient Valuation": With respect to any Mortgage Loan, a
valuation of the related Mortgaged Property
by a court of competent jurisdiction
in an amount less than the then outstanding
principal balance of the Mortgage
Loan, or any reduction in the amount of
principal to be paid in connection with
any scheduled Monthly Payment that results
in a permanent forgiveness of
principal, which valuation results from a
proceeding initiated under the
Bankruptcy Code.
"Definitive Certificates": As defined in Section 5.02(c)
hereof.
"Delinquent": Any Mortgage Loan with respect to which the
Monthly
Payment due on a Due Date is not made by
the close of business on the next
scheduled Due Date for such Mortgage
Loan.
"Depositor": Wells Fargo Asset Securities Corporation, a
Delaware
corporation, or any successor in
interest.
"Depository": The initial depository shall be The Depository
Trust
Company, whose nominee is Cede & Co.,
or any other organization registered as a
"clearing agency" pursuant to Section 17A
of the Exchange Act. 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(a)(5) of the Uniform Commercial Code
of the State of New York.
"Depository Participant": A broker, dealer, bank or other
financial
institution or other person for whom from
time to time a Depository effects
book-entry transfers and pledges of
securities deposited with the Depository.
"Determination Date": With respect to any Distribution Date,
the
17th day of the calendar month in which
such Distribution Date occurs or, if
such 17th day is not a Business Day, the
Business Day immediately preceding such
17th day.
"Disqualified Organization": A "disqualified organization"
under
Section 860E of the Code, which as of the
Closing Date is any of: (i) the United
States, any state or political subdivision
thereof, any possession of the United
States, any foreign government, any
international organization, or any agency or
instrumentality of any of the foregoing,
(ii) any organization (other than a
cooperative described in Section 521 of the
Code) which is exempt from the tax
imposed by Chapter 1 of the Code unless
such organization is subject to the tax
imposed by Section 511 of the Code, (iii)
any organization described in Section
1381(a)(2)(C) of the Code, or (iv) any
other Person so designated by the
Securities Administrator based upon an
Opinion of Counsel provided by nationally
recognized counsel to the Securities
Administrator that the holding of an
ownership interest in the Class R
Certificate by such Person may cause the Trust
Fund or any Person having an ownership
interest in any Class of Certificates
(other than such Person) to incur liability
for any federal tax imposed under
the Code that would not otherwise be
imposed but for the transfer of an
ownership interest in the Class R
Certificate to such Person. A corporation will
not be treated as an instrumentality of the
United States or of any state or
political subdivision thereof if all of its
activities are subject to tax and a
majority of its board of directors is not
selected by a governmental unit. The
term "United States," "state" and
"international organization" shall have the
meanings set forth in Section 7701 of the
Code.
"Distribution Account": The trust account or accounts created
and
maintained by the Securities Administrator
pursuant to Section 3.04(b), which
shall be entitled "Distribution Account,
Wells Fargo Bank, N.A., as Securities
Administrator, in trust for the registered
Holders of Wells Fargo Home Equity
Asset-Backed Securities 2005-1 Trust, Home
Equity Asset-Backed Certificates,
Series 2005-1," and which must be an
Eligible Account.
"Distribution Date": The 25th day of any calendar month, or if
such
25th day is not a Business Day, the
Business Day immediately following such 25th
day, commencing in July 2005.
"Distribution Date Statement": As defined in Section 4.06(a)
hereof.
"Document Transfer Event": The 60th day following the day on
which
either (i) Wells Fargo Bank, N.A. is no
longer the Servicer of any of the
Mortgage Loans or (ii) the senior,
unsecured long-term debt rating of Wells
Fargo & Company is less than "BBB-" by
Fitch.
"Due Date": With respect to each Mortgage Loan, the day of the
calendar month on which the Monthly Payment
for such Mortgage Loan was due in
accordance with the terms of the related
Mortgage Note, exclusive of any grace
period.
"Eligible Account": Any of (i) an account or accounts
maintained
with a federal or state chartered
depository institution or trust company the
short-term unsecured debt obligations of
which (or, in the case of a depository
institution or trust company that is the
principal subsidiary of a holding
company, the short-term unsecured debt
obligations of such holding company) are
rated "A-1+" by S&P, "P-1" by Moody's
and "F-1" by Fitch (or comparable ratings
if S&P, Moody's and Fitch are not the
Rating Agencies) by each of the Rating
Agencies at the time any amounts are held
on deposit therein, (ii) an account or
accounts the deposits in which are fully
insured by the FDIC, (iii) a trust
account or accounts maintained with the
trust department of a federal or state
chartered depository institution, national
banking association or trust company
acting in its fiduciary capacity or (iv) an
account otherwise acceptable to each
Rating Agency without reduction or
withdrawal of their then current ratings of
the Certificates as evidenced by a letter
from each Rating Agency to the
Securities Administrator and the Trustee.
Eligible Accounts may bear interest.
"Eligible Investments": Any one or more of the following
obligations
or securities acquired at a purchase price
of not greater than par, regardless
of whether issued or managed by the
Depositor, the Servicer, the Securities
Administrator, the Trustee or any of their
respective Affiliates or for which an
Affiliate of the Trustee or the Securities
Administrator serves as an advisor:
(i) direct obligations of, or obligations fully guaranteed as
to
timely
payment of principal and interest by, the United States or any
agency or
instrumentality thereof, provided such obligations are backed
by
the full
faith and credit of the United States;
(ii) (A) demand and time deposits in, certificates of deposit
of,
bankers'
acceptances issued by or federal funds sold by any depository
institution or trust company (including the Trustee, the
Securities
Administrator or their respective agents acting in their
respective
commercial
capacities) incorporated under the laws of the United States of
America or
any state thereof and subject to supervision and examination by
federal
and/or state authorities, so long as, at the time of such
investment
or contractual commitment providing for such investment, such
depository
institution or trust company or its ultimate parent has a
short-term
uninsured debt rating in one of the two highest available
rating
categories of S&P and Moody's and the highest available
rating
category
of Fitch and provided that each such investment has an original
maturity
of no more than 365 days and (B) any other demand or time
deposit
or deposit
which is fully insured by the FDIC;
(iii) repurchase obligations with a term not to exceed 30 days
with
respect to
any security described in clause (i) above and entered into
with a
depository institution or trust company (acting as principal)
rated
A or
higher by S&P and Fitch and A2 or higher by Moody's,
provided,
however,
that collateral transferred pursuant to such repurchase
obligation
must be of the type described in clause (i) above and must (A)
be valued
daily at current market prices plus accrued interest or (B)
pursuant
to such valuation, be equal, at all times, to 105% of the cash
transferred by the Trustee or the Securities Administrator in
exchange for
such
collateral and (C) be delivered to the Trustee, the Securities
Administrator or, if the Trustee or the Securities Administrator
is
supplying
the collateral, an agent for the Trustee or the Securities
Administrator, as the case may be, in such a manner as to
accomplish
perfection
of a security interest in the collateral by possession of
certificated securities;
(iv) securities bearing interest or sold at a discount that are
issued by
any corporation incorporated under the laws of the United
States
of America
or any State thereof and that are rated by each Rating Agency
in its
highest long-term unsecured rating categories at the time of
such
investment
or contractual commitment providing for such investment;
(v) commercial paper (including both non-interest-bearing
discount
obligations and interest-bearing obligations payable on demand or
on a
specified
date not more than 30 days after the date of acquisition
thereof)
that is rated by each Rating Agency in its highest short-term
unsecured
debt rating available at the time of such investment;
(vi) units of money market funds registered under the
Investment
Company
Act of 1940 (including funds managed or advised by the Trustee
or
the
Securities Administrator or affiliates thereof) that, if rated by
each
Rating
Agency, are rated in its highest rating category (if so rated
by
such
Rating Agency); and
(vii) if previously confirmed in writing to the Trustee and the
Securities
Administrator, any other demand, money market or time deposit,
or any
other obligation, security or investment, as may be acceptable
to
the Rating
Agencies in writing as an eligible investment of funds backing
securities
having ratings equivalent to its highest initial rating of the
Senior
Certificates;
provided, that no instrument described hereunder shall evidence
either the right to receive (a) only
interest with respect to the obligations
underlying such instrument or (b) both
principal and interest payments derived
from obligations underlying such instrument
and the interest and principal
payments with respect to such instrument
provide a yield to maturity at par
greater than 120% of the yield to maturity
at par of the underlying obligations.
"Eligible Substitute Mortgage Loan": A mortgage loan substituted
for
a Defective Mortgage Loan pursuant to the
terms of this Agreement which must, on
the date of such substitution, (i) have an
outstanding principal balance, after
application of all scheduled payments of
principal and interest due during or
prior to the month of substitution, not in
excess of, the outstanding principal
balance of the Defective Mortgage Loan as
of the Due Date in the calendar month
during which the substitution occurs, (ii)
have a Mortgage Interest Rate, with
respect to a Fixed Rate Mortgage Loan, not
less than the Mortgage Interest Rate
of the Defective Mortgage Loan and not more
than 1% in excess of the Mortgage
Interest Rate of such Defective Mortgage
Loan, (iii) if an Adjustable Rate
Mortgage Loan, have a Maximum Mortgage
Interest Rate not less than the Maximum
Mortgage Interest Rate for the Defective
Mortgage Loan, (iv) if an Adjustable
Rate Mortgage Loan, have a Minimum Mortgage
Interest Rate not less than the
Minimum Mortgage Interest Rate of the
Defective Mortgage Loan, (v) if an
Adjustable Rate Mortgage Loan, have a Gross
Margin equal to or greater than the
Gross Margin of the Defective Mortgage
Loan, (vi) if an Adjustable Rate Mortgage
Loan, have the same Index and frequency of
adjustment as the Defective Mortgage
Loan (vii) if an Adjustable Rate Mortgage
Loan, have a next Adjustment Date not
more than three months later than the next
Adjustment Date on the Defective
Mortgage Loan, (viii) have an original term
to maturity not greater than (and
not more than one year less than) that of
the Defective Mortgage Loan, (ix) be
current as of the date of substitution, (x)
have a Loan-to-Value Ratio as of the
date of substitution equal to or lower than
the Loan-to-Value Ratio of the
Defective Mortgage Loan as of such date,
(xi) have a risk grading at least equal
to the risk grading assigned on the
Defective Mortgage Loan, (xii) have the same
lien priority as the Defective Mortgage
Loan; (xiii) have a Prepayment Penalty
at least equal in amount and duration of
that of the Defective Mortgage Loan and
(xiv) conform to each representation and
warranty set forth in Section 2.04
hereof applicable to the Defective Mortgage
Loan. In the event that one or more
mortgage loans are substituted for one or
more Defective Mortgage Loans, the
amounts described in clause (i) hereof
shall be determined on the basis of
aggregate principal balance, the Mortgage
Interest Rates described in clause
(ii) hereof shall be determined on the
basis of weighted average Mortgage
Interest Rates, the risk gradings described
in clause (xi) hereof shall be
satisfied as to each such mortgage loan,
the terms described in clause (viii)
hereof shall be determined on the basis of
weighted average remaining term to
maturity, the Loan-to-Value Ratios
described in clause (x) hereof shall be
satisfied as to each such mortgage loan
and, except to the extent otherwise
provided in this sentence, the
representations and warranties described in
clause (xiv) hereof must be satisfied as to
each Eligible Substitute Mortgage
Loan or in the aggregate, as the case may
be. Any Defective Mortgage Loan that
is a Group I Mortgage Loan or Group II
Mortgage Loan must be replaced by an
Eligible Substitute Mortgage Loan that will
be a Group I Mortgage Loan or Group
II Mortgage Loan, as applicable.
"ERISA": The Employee Retirement Income Security Act of 1974,
as
amended.
"ERISA-Restricted Certificates": Any of the Class M-12, Class
M-13,
Class M-14, Class CE, Class P and Class R
Certificates.
"Escrow Account": The account or accounts created and
maintained
pursuant to Section 3.06.
"Escrow Agreement": An agreement between a Mortgagor and the
Servicer relating to accounts constituting
taxes and/or fire and hazard
insurance premiums required to be
escrowed.
"Escrow Payments": The amounts constituting taxes and/or fire
and
hazard insurance premiums required to be
escrowed to an Escrow Agreement.
"Estate in Real Property": A fee simple estate in a parcel of
real
property.
"Exchange Act": The Securities Exchange Act of 1934, as
amended.
"Expense Fee Rate": The sum of (i) the Servicing Fee Rate and
(ii)
the Credit Risk Manager Fee Rate.
"Extended Period": As defined in Section 9.04(b).
"Extra Principal Distribution Amount": As of any Distribution
Date,
the lesser of (x) the Monthly Excess
Interest Amount for such Distribution Date,
after reduction (but not below zero) by any
Current Interest Shortfall and (y)
the Overcollateralization Deficiency for
such Distribution Date.
"FDIC": Federal Deposit Insurance Corporation or any successor
thereto.
"Fidelity Bond": Shall have the meaning assigned thereto in
Section
3.12.
"Fitch": Fitch Ratings and its successors, and if such company
shall
for any reason no longer perform the
functions of a securities rating agency,
"Fitch" shall be deemed to refer to any
other "nationally recognized statistical
rating organization" as set forth on the
most current list of such organizations
released by the Commission.
"Fixed Rate Mortgage Loan": A Mortgage Loan which has a
constant
annual rate at which interest accrues in
accordance with the provisions of the
related Mortgage Note.
"Foreclosure Price": The amount reasonably expected to be
received
from the sale of the related Mortgaged
Property net of any expenses associated
with foreclosure proceedings.
"Formula Rate": Any of the Class AI-1A Formula Rate, the Class
AI-1B
Formula Rate, the Class AII-1 Formula Rate,
the Class M-1 Formula Rate, the
Class M-2 Formula Rate, the Class M-3
Formula Rate, the Class M-4 Formula Rate,
the Class M-5 Formula Rate, the Class M-6
Formula Rate, the Class M-7 Formula
Rate, the Class M-8 Formula Rate, the Class
M-9 Formula Rate, the Class M-10
Formula Rate, the Class M-11 Formula Rate,
the Class M-12 Formula Rate, the
Class M-13 Formula Rate and the Class M-14
Formula Rate.
"Grantor Trust": That portion of the Trust exclusive of REMIC 1
and
REMIC 2 consisting of (a) the Prepayment
Penalties, any Originator Prepayment
Penalty Payment Amounts, any Servicer
Prepayment Penalty Payment Amounts,
proceeds thereof in the Custodial Account
or Distribution Account and the right
of the Class P Certificateholders to
receive such Prepayment Penalties,
Originator Prepayment Penalty Payment
Amounts and Servicer Prepayment Penalty
Payment Amounts, (b) the right of the
Certificates (other than the Class CE,
Class P and Class R Certificates) to
receive Cap Carryover Amounts, (c) the
Yield Maintenance Agreements, the Reserve
Accounts and the beneficial interest
of the Class CE Certificates with respect
thereto and (d) the obligation of the
Class CE Certificates to pay Cap Carryover
Amounts.
"Gross Margin": With respect to each Adjustable Rate Mortgage
Loan,
the fixed percentage set forth in the
related Mortgage Note that is added to the
applicable Index on each Adjustment Date in
accordance with the terms of the
related Mortgage Note used to determine the
Mortgage Interest Rate for such
Mortgage Loan.
"Group I Cap": As of any Distribution Date and the Class AI
Certificates, a per annum rate (adjusted by
multiplying such rate by a fraction
equal to 30 over the actual number of days
in the related Interest Accrual
Period) equal to the Weighted Average Net
Mortgage Interest Rate for the Group I
Mortgage Loans.
"Group I Interest Remittance Amount": As of any Distribution
Date,
the sum, without duplication, of (i) all
interest due and collected with respect
to the related Collection Period on the
Group I Mortgage Loans received by the
Servicer on or prior to the Determination
Date for such Distribution Date and
any interest advanced by the Servicer or
the Trustee on the Group I Mortgage
Loans with respect to the related
Collection Period (less the Servicing Fee,
amounts available for reimbursement of
Advances and Servicing Advances pursuant
to Section 3.05 and expenses reimbursable
pursuant to Section 6.03, amounts
reimbursable or payable to the Trustee
pursuant to this Agreement, including,
without limitation, Sections 7.01 and 8.05
and amounts reimbursable or payable
to the Securities Administrator pursuant to
this Agreement, including, without
limitation, Sections 8.05 and 9.01(c)),
(ii) all Compensating Interest paid by
the Servicer on the related Distribution
Date with respect to such Group I
Mortgage Loans, (iii) the portion of any
payment in connection with any
Principal Prepayment, substitution,
Purchase Price, Termination Price, Insurance
Proceeds or Net Liquidation Proceeds
relating to interest with respect to such
Group I Mortgage Loans received during the
related Prepayment Period and (iv)
the portion of any Reimbursement Amount
relating to interest on such Group I
Mortgage Loans received during the related
Prepayment Period.
"Group I Maximum Rate Cap": With respect to any Distribution
Date
and for the Class AI Certificates, a per
annum rate (adjusted by multiplying
such rate by a fraction equal to 30 over
the actual number of days in the
related Interest Accrual Period) equal to
the average of the Net Rate Ceilings
for the Adjustable Rate Mortgage Loans
which are Group I Mortgage Loans and the
Net Mortgage Interest Rates for the Fixed
Rate Mortgage Loans which are Group I
Mortgage Loans, weighted on the basis of
the unpaid principal balances of the
Group I Mortgage Loans as of the first day
of the related Collection Period.
"Group I Mortgage Loan": Each Mortgage Loan listed on Exhibit
D-1
hereto.
"Group I Overcollateralization Floor": With respect to any
Distribution Date, the amount by which the
aggregate unpaid principal balance of
the Group I Mortgage Loans as of the last
day of the related Collection Period
exceeds the product of (i) 0.50% and (ii)
the aggregate unpaid principal balance
of the Group I Mortgage Loans on the
Cut-off Date.
"Group I Principal Distribution Amount": With respect to any
Distribution Date, (a) the product of (i)
the Group I Principal Percentage and
(ii) the sum of (A) the Principal
Remittance Amount and (B) the Extra Principal
Distribution Amount, minus (b) the Group I
Principal Percentage of the
Overcollateralization Release Amount.
"Group I Principal Percentage": With respect to any
Distribution
Date and any Class AI Certificates, the
percentage equivalent to a fraction, the
numerator of which is the Principal
Remittance Amount attributable to the Group
I Mortgage Loans for such Distribution Date
and the denominator of which is the
Principal Remittance Amount for such
Distribution Date.
"Group I Senior Principal Distribution Amount": With respect to
any
Distribution Date, the excess of (a) the
aggregate Principal Balance of the
Class AI Certificates immediately prior to
such Distribution Date over (b) the
lesser of (x) the product of (1)
67.399955082748% and (2) the aggregate unpaid
principal balance of the Group I Mortgage
Loans as of the last day of the
related Collection Period and (y) the Group
I Overcollateralization Floor.
"Group II Cap": As of any Distribution Date and the Class AII
Certificates, a per annum rate (adjusted by
multiplying such rate by a fraction
equal to 30 over the actual number of days
in the related Interest Accrual
Period) equal to the Weighted Average Net
Mortgage Interest Rate for the Group
II Mortgage Loans.
"Group II Interest Remittance Amount": As of any Distribution
Date,
the sum, without duplication, of (i) all
interest due and collected with respect
to the related Collection Period on the
Group II Mortgage Loans received by the
Servicer on or prior to the Determination
Date for such Distribution Date and
any interest advanced by the Servicer or
the Trustee on the Group II Mortgage
Loans with respect to the related
Collection Period (less the Servicing Fee,
amounts available for reimbursement of
Advances and Servicing Advances pursuant
to Section 3.05 and expenses reimbursable
pursuant to Section 6.03, amounts
reimbursable or payable to the Trustee
pursuant to this Agreement, including,
without limitation, Sections 7.01 and 8.05
and amounts reimbursable or payable
to the Securities Administrator pursuant to
this Agreement, including, without
limitation, Sections 8.05 and 9.01(c)),
(ii) all Compensating Interest paid by
the Servicer on the related Distribution
Date with respect to such Group II
Mortgage Loans, (iii) the portion of any
payment in connection with any
Principal Prepayment, substitution,
Purchase Price, Termination Price, Insurance
Proceeds or Net Liquidation Proceeds
relating to interest with respect to such
Group II Mortgage Loans received during the
related Prepayment Period and (iv)
the portion of any Reimbursement Amount
relating to interest on such Group II
Mortgage Loans received during the related
Prepayment Period.
"Group II Maximum Rate Cap": With respect to any Distribution
Date
and for the Class AII Certificates, a per
annum rate (adjusted by multiplying
such rate by a fraction equal to 30 over
the actual number of days in the
related Interest Accrual Period) equal to
the average of the Net Rate Ceilings
for the Adjustable Rate Mortgage Loans
which are Group II Mortgage Loans and the
Net Mortgage Interest Rates for the Fixed
Rate Mortgage Loans which are Group II
Mortgage Loans, weighted on the basis of
the unpaid principal balances of the
Group II Mortgage Loans as of the first day
of the related Collection Period.
"Group II Mortgage Loan": Each Mortgage Loan listed on Exhibit
D-2
hereto.
"Group II Overcollateralization Floor": With respect to any
Distribution Date, the amount by which the
aggregate unpaid principal balance of
the Group II Mortgage Loans as of the last
day of the related Collection Period
exceeds the product of (i) 0.50% and (ii)
the aggregate unpaid principal balance
of the Group II Mortgage Loans on the
Cut-off Date.
"Group II Principal Distribution Amount": With respect to any
Distribution Date, (a) the product of (i)
the Group II Principal Percentage and
(ii) the sum of (A) the Principal
Remittance Amount and (B) the Extra Principal
Distribution Amount, minus (b) the Group II
Principal Percentage of the
Overcollateralization Release Amount.
"Group II Principal Percentage": With respect to any
Distribution
Date and the Class AII-1 Certificates, the
percentage equivalent to a fraction,
the numerator of which is the Principal
Remittance Amount attributable to the
Group II Mortgage Loans for such
Distribution Date and the denominator of which
is the Principal Remittance Amount for such
Distribution Date.
"Group II Senior Principal Distribution Amount": With respect to
any
Distribution Date, the excess of (a) the
Principal Balance of the Class AII
Certificates immediately prior to such
Distribution Date over (b) the lesser of
(x) the product of (1) 67.399955082748% and
(2) the aggregate unpaid principal
balance of the Group II Mortgage Loans as
of the last day of the related
Collection Period and (y) the Group II
Overcollateralization Floor.
"Group Subordinate Amount": With respect to any Distribution
Date
and (i) Loan Group I, will be equal to the
greater of zero and the excess of the
aggregate unpaid principal balance of the
Group I Mortgage Loans as of the first
day of the related Collection Period over
the aggregate Principal Balance of the
Class AI Certificates immediately prior to
such Distribution Date and (ii) Loan
Group II, will be equal to the greater of
zero and the excess of the aggregate
unpaid principal balance of the Group II
Mortgage Loans as of the first day of
the related Collection Period over the
Principal Balance of the Class AII-1
Certificates immediately prior to such
Distribution Date.
"Independent": When used with respect to any specified Person,
any
such Person who (i) is in fact independent
of the Depositor, the Securities
Administrator, the Trustee, the Servicer
and their respective Affiliates, (ii)
does not have any direct financial interest
in or any material indirect
financial interest in the Depositor, the
Securities Administrator, the Trustee
or the Servicer, or any Affiliate thereof,
and (iii) is not connected with the
Depositor, the Securities Administrator,
the Trustee or the Servicer, or any
Affiliate thereof, as an officer, employee,
promoter, underwriter, trustee,
partner, director or Person performing
similar functions; provided, however,
that a Person shall not fail to be
Independent of the Depositor, the Securities
Administrator, the Trustee or the Servicer,
or any Affiliate thereof, merely
because such Person is the beneficial owner
of 1% or less of any class of
securities issued by the Depositor, the
Securities Administrator, the Trustee or
the Servicer, or any Affiliate thereof, as
the case may be.
"Index": With respect to each Adjustable Rate Mortgage Loan and
with
respect to each related Adjustment Date,
the index as specified in the related
Mortgage Note.
"Initial Overcollateralization Amount": $9,420,616.
"Initial Principal Balance": With respect to any Certificate of
a
Class other than a Class CE, Class P or
Class R Certificate, the amount
designated "Initial Principal Balance" on
the face thereof.
"Insurance Proceeds": Proceeds of any title policy, hazard policy
or
other insurance policy covering a Mortgage
Loan, to the extent such proceeds are
not to be applied to the restoration of the
related Mortgaged Property or
released to the Mortgagor in accordance
with the procedures that the Servicer
would follow in servicing mortgage loans
held for its own account, subject to
the terms and conditions of the related
Mortgage Note and Mortgage.
"Interest Accrual Period": With respect to any Distribution
Date,
the period from and including the preceding
Distribution Date to the day prior
to the current Distribution Date (or, in
the case of the first Distribution
Date, the period from June 29, 2005 through
July 24, 2005).
"Interest Carry Forward Amount": For any Class of Certificates
(other than the Class CE, Class P and Class
R Certificates) and any Distribution
Date, the sum of (a) the excess, if any, of
the Accrued Certificate Interest for
the prior Distribution Date and any
Interest Carry Forward Amount for the prior
Distribution Date, over the amount in
respect of interest actually distributed
on such Class on such prior Distribution
Date and (b) interest on such excess at
the applicable Pass-Through Rate on the
basis of the actual number of days
elapsed since the prior Distribution
Date.
"Interest Percentage": With respect to any Class of Certificates
and
any Distribution Date, the ratio (expressed
as a decimal carried to at least six
places) of the Accrued Certificate Interest
for such Class to the sum of the
Accrued Certificate Interest for all
Classes, in each case with respect to such
Distribution Date, without regard to
Current Interest Shortfalls.
"Interest Remittance Amount": As of any Determination Date, the
sum
of the Group I Interest Remittance Amount
and the Group II Interest Remittance
Amount.
"Late Collections": With respect to any Mortgage Loan, all
amounts
received subsequent to the Determination
Date immediately following any related
Collection Period, whether as late payments
of Monthly Payments or as Insurance
Proceeds, Condemnation Proceeds,
Liquidation Proceeds or otherwise, which
represent late payments or collections of
principal and/or interest due (without
regard to any acceleration of payments
under the related Mortgage and Mortgage
Note) but delinquent on a contractual basis
for such Collection Period and not
previously recovered.
"LIBOR Business Day": Any day on which banks in London, England
and
the City of New York are open and
conducting transactions in foreign currency
and exchange.
"LIBOR Determination Date": With respect to any Floating Rate
Class,
(i) for the first Distribution Date, the
second LIBOR Business Day preceding the
Closing Date and (ii) for each subsequent
Distribution Date, the second LIBOR
Business Day prior to the immediately
preceding Distribution Date.
"Liquidated Mortgage Loan": As to any Distribution Date, any
Mortgage Loan in respect of which the
Servicer has determined, in accordance
with the servicing procedures specified
herein, as of the end of the related
Prepayment Period, that all Liquidation
Proceeds, Condemnation Proceeds and
Insurance Proceeds which it expects to
recover with respect to the liquidation
of the Mortgage Loan or disposition of the
related REO Property have been
recovered.
"Liquidation Proceeds": The amount (other than amounts received
in
respect of the rental of any REO Property
prior to REO Disposition) received by
the Servicer in connection with (i) the
taking of all or a part of a Mortgaged
Property by exercise of the power of
eminent domain or condemnation or (ii) the
liquidation of a defaulted Mortgage Loan by
means of a trustee's sale,
foreclosure sale or otherwise.
"Liquidation Report": The report with respect to a Liquidated
Mortgage Loan in such form as is agreed to
by the Servicer, the Trustee and the
Securities Administrator listing (i) the
sale price of the related Mortgaged
Property or amount of the REO Disposition,
(ii) the amount of any Realized Loss
(or gain) with respect to such Liquidated
Mortgage Loan, (iii) the expenses
relating to the liquidation of such
Liquidated Mortgage Loan and (iv) such other
information as is agreed to by the
Servicer, the Trustee and the Securities
Administrator.
"Loan Group": Either of Loan Group I or Loan Group II.
"Loan Group I": The Group I Mortgage Loans.
"Loan Group II": The Group II Mortgage Loans.
"Loan-to-Value Ratio": For any Mortgage Loan, the ratio,
expressed
as a percentage, the numerator of which is
the original loan amount (unless
otherwise indicated) of a particular
Mortgage Loan at origination and the
denominator of which is the lesser of (x)
the appraised value of the related
Mortgaged Property determined in the
appraisal used by the originator at the
time of origination of such Mortgage Loan,
and (y) if the Mortgage is originated
in connection with a sale of the Mortgaged
Property, the sale price for such
Mortgaged Property.
"Losses": As defined in Section 9.03.
"Lost Note Affidavit": With respect to any Mortgage Loan as to
which
the original Mortgage Note has been
permanently lost or destroyed and has not
been replaced, an affidavit from the Seller
certifying that the original
Mortgage Note has been lost, misplaced or
destroyed (together with a copy of the
related Mortgage Note and indemnifying the
Trust against any loss, cost or
liability resulting from the failure to
deliver the original Mortgage Note) in
the form of Exhibit H hereto.
"Majority Certificateholders": The Holders of Certificates
evidencing at least 51% of the Voting
Interests.
"Majority Class CE Certificateholders": The Holders of Class CE
Certificates evidencing at least a 51%
Percentage Interest in the Class CE
Certificates.
"Marker Rate": With respect to the Class CE Certificates and
any
Distribution Date, a per annum rate equal
to two (2) times the weighted average
of the Uncertificated REMIC Pass-Through
Rates for REMIC 1 Regular Interest
LT1AI1A, REMIC 1 Regular Interest LT1AI1B,
REMIC 1 Regular Interest LT1AII1,
REMIC 1 Regular Interest LT1M1, REMIC 1
Regular Interest LT1M2, REMIC 1 Regular
Interest LT1M3, REMIC 1 Regular Interest
LT1M4, REMIC 1 Regular Interest LT1M5,
REMIC 1 Regular Interest LT1M6, REMIC 1
Regular Interest LT1M7, REMIC 1 Regular
Interest LT1M8, REMIC 1 Regular Interest
LT1M9, REMIC 1 Regular Interest LT1M10,
REMIC 1 Regular Interest LT1M11, REMIC 1
Regular Interest LT1M12, REMIC 1
Regular Interest LT1M13, REMIC 1 Regular
Interest LT1M14 and REMIC 1 Regular
Interest LT1ZZ, (i) with the rate on each
such REMIC Regular Interest (other
than REMIC 1 Regular Interest LT1ZZ)
subject to a cap equal to the Pass-Through
Rate of its Corresponding Class (taking
into account in determining any such
Pass-Through Rate the imposition of the
Group I Cap and the Group II Cap or the
Pool Cap, as applicable, as described in
footnotes (1) through (17) to the table
in the Preliminary Statement relating to
the Certificates) for the purposes of
this calculation and (ii) with the rate on
REMIC 1 Regular Interest LT1ZZ
subject to a cap of zero for the purpose of
this calculation; provided, however,
that for this purpose, calculations of the
Uncertificated REMIC 1 Pass-Through
Rate and the related caps with respect to
each REMIC I Regular Interest shall be
multiplied by a fraction, the numerator of
which is the actual number of days in
the Interest Accrual Period and the
denominator of which is 30.
"Maximum LT1ZZ Uncertificated Accrued Interest Deferral
Amount":
With respect to any Distribution Date, the
excess of (a) accrued interest at the
Uncertificated REMIC 1 Pass-Through Rate
applicable to REMIC 1 Regular Interest
LT1ZZ for such Distribution Date on a
balance equal to the Uncertificated
Principal Balance of REMIC 1 Regular
Interest LT1ZZ minus the REMIC 1
Overcollateralized Amount, in each case for
such Distribution Date, over (b)
Uncertificated Accrued Interest on REMIC 1
Regular Interest LT1AI1A, REMIC 1
Regular Interest LT1AI1B, REMIC 1 Regular
Interest LT1AII1, REMIC 1 Regular
Interest LT1M1, REMIC 1 Regular Interest
LT1M2, REMIC 1 Regular Interest LT1M3,
REMIC 1 Regular Interest LT1M4, REMIC 1
Regular Interest LT1M5, REMIC 1 Regular
Interest LT1M6, REMIC 1 Regular Interest
LT1M7, REMIC 1 Regular Interest LT1M8,
REMIC 1 Regular Interest LT1M9, REMIC 1
Regular Interest LT1M10, REMIC 1 Regular
Interest LT1M11, REMIC 1 Regular Interest
LT1M12, REMIC 1 Regular Interest
LT1M13 and REMIC 1 Regular Interest LT1M14
each subject to a cap equal to the
Pass-Through Rate of the related
Corresponding Class for the purpose of this
calculation; provided, however, that for
this purpose, calculations of the
Uncertificated REMIC 1 Pass-Through Rate
and the related caps with respect to
Uncertificated Accrued Interest on each
REMIC I Regular Interest shall be
multiplied by a fraction, the numerator of
which is the actual number of days in
the Interest Accrual Period and the
denominator of which is 30.
"MERS": The Mortgage Electronic Registration Systems, Inc.
"MERS Mortgage Loan": Any MOM Mortgage Loan or any other
Mortgage
Loan as to which MERS is (or is intended to
be) the mortgagee of record and as
to which a MIN has been assigned.
"MIN": A MERS Mortgage Identification Number assigned to a
Mortgage
Loan in accordance with the MERS Procedure
Manual.
"MOM": A Mortgage Loan where the related Mortgage names MERS as
the
original mortgagee thereof, as to which a
MIN has been assigned, and which
Mortgage has not been assigned to any other
person.
"Minimum Mortgage Interest Rate": With respect to each
Adjustable
Rate Mortgage Loan, the percentage set
forth in the related Mortgage Note as the
minimum Mortgage Interest Rate
thereunder.
"Monthly Excess Cashflow Amount": The sum of the Monthly Excess
Interest Amount after reduction (but not
below zero) by any Current Interest
Shortfall, the Overcollateralization
Release Amount and any portion of the
Principal Distribution Amount (without
duplication) remaining after principal
distributions on the Certificates (other
than the Class CE, Class P and Class R
Certificates).
"Monthly Excess Interest Amount": With respect to each
Distribution
Date, the amount, if any, by which the
Interest Remittance Amount for such
Distribution Date exceeds the aggregate
amount distributed on such Distribution
Date pursuant to paragraphs (i) through
(xix) of Section 4.01.
"Monthly Payment": With respect to any Mortgage Loan, the
scheduled
monthly payment of principal and interest
on such Mortgage Loan which is payable
by the related Mortgagor from time to time
under the related Mortgage Note,
determined: (a) after giving effect to (i)
any Deficient Valuation and/or Debt
Service Reduction with respect to such
Mortgage Loan and (ii) any reduction in
the amount of interest collectible from the
related Mortgagor pursuant to the
Relief Act or similar state laws; (b)
without giving effect to any extension
granted or agreed to by the Servicer
pursuant to Section 3.01; and (c) on the
assumption that all other amounts, if any,
due under such Mortgage Loan are paid
when due.
"Moody's": Moody's Investors Service, Inc., and its successors,
and
if such company shall for any reason no
longer perform the functions of a
securities rating agency, "Moody's" shall
be deemed to refer to any other
"nationally recognized statistical rating
organization" as set forth on the most
current list of such organizations released
by the Commission.
"Mortgage": The mortgage, deed of trust or other instrument
creating
a first or second lien on, or first or
second priority security interest in, a
Mortgaged Property securing a Mortgage
Note.
"Mortgage File": Either of the Owner Mortgage File or Retained
Mortgage File.
"Mortgage Interest Rate": With respect to each Mortgage Loan,
the
annual rate at which interest accrues on
such Mortgage Loan from time to time in
accordance with the provisions of the
related Mortgage Note, which rate (i) in
the case of each Fixed Rate Mortgage Loan
shall remain constant at the rate set
forth in the applicable Mortgage Loan
Schedule as the Mortgage Interest Rate in
effect immediately following the applicable
Cut-off Date and (ii) in the case of
each Adjustable Rate Mortgage Loan (A) as
of any date of determination until the
first Adjustment Date following the
applicable Cut-off Date shall be the rate
set forth in the applicable Mortgage Loan
Schedule as the Mortgage Interest Rate
in effect immediately following the
applicable Cut-off Date and (B) as of any
date of determination thereafter shall be
the rate as adjusted on the most
recent Adjustment Date, to equal the sum,
rounded as provided in the Mortgage
Note, of the Index, determined as set forth
in the related Mortgage Note, plus
the related Gross Margin subject to the
limitations set forth in the related
Mortgage Note. With respect to each
Mortgage Loan that becomes an REO Property,
as of any date of determination, the annual
rate determined in accordance with
the immediately preceding sentence as of
the date such Mortgage Loan became an
REO Property.
"Mortgage Loan": Each mortgage loan transferred and assigned to
the
Trustee pursuant to Section 2.01 or Section
2.03(d) as from time to time held as
a part of the Trust Fund, the Mortgage
Loans so held being identified in the
Mortgage Loan Schedules.
"Mortgage Loan Purchase Agreement": The agreement between the
Seller
and the Depositor, dated as of June 29,
2005, regarding the transfer of the
Mortgage Loans by the Seller to or at the
direction of the Depositor.
"Mortgage Loan Schedule": As of any date with respect to the
Mortgage Loans, the lists of such Mortgage
Loans included in the Trust Fund on
such date, separately identifying the Fixed
Rate Mortgage Loans and the
Adjustable Rate Mortgage Loans, attached
hereto as Exhibits D-1, and D-2. The
Mortgage Loan Schedules shall set forth the
following information with respect
to each Mortgage Loan:
(1) the
Mortgage Loan identifying number;
(2) the
city, state and zip code of the Mortgaged Property;
(3) the
type of property;
(4) the
Mortgage Interest Rate;
(5) the
Net Mortgage Interest Rate;
(6) the
Monthly Payment;
(7) the
original number of months to maturity;
(8) the
scheduled maturity date;
(9) the
Cut-off Date Principal Balance;
(10) the
Loan-to-Value Ratio at origination;
(11)
whether such Mortgage Loan is covered by primary mortgage
insurance;
(12) the
applicable Servicing Fee Rate;
(13) the
Index;
(14) the
Gross Margin;
(15) the
Periodic Cap;
(16) the
first Adjustment Date;
(17) the Rate
Ceiling; and
(18) a
code indicating whether the Mortgage Loan has a Prepayment
Penalty
and the Prepayment Penalty term.
The Mortgage Loan Schedules shall set forth the following
information, as of the applicable Cut-off
Date, with respect to the Mortgage
Loans in the aggregate, for Loan Group I
and Loan Group II: (1) the number of
Mortgage Loans; (2) the current unpaid
principal balance of the Mortgage Loans;
(3) the weighted average Mortgage Interest
Rate of the Mortgage Loans; and (4)
the weighted average maturity of the
Mortgage Loans. The Mortgage Loan Schedules
shall be amended from time to time in
accordance with the provisions of this
Agreement. With respect to any Eligible
Substitute Mortgage Loan, Cut-off Date
shall refer to the applicable date of
substitution.
"Mortgage Note": The original executed note or other evidence
of
indebtedness evidencing the indebtedness of
a Mortgagor under a Mortgage Loan.
"Mortgage Pool": The pool of Mortgage Loans, identified on
Exhibits
D-1 and D-2 from time to time, and any REO
Properties acquired in respect
thereof.
"Mortgaged Property": The underlying property securing a
Mortgage
Loan, including any REO Property,
consisting of an Estate in Real Property
improved by a Residential Dwelling.
"Mortgagor": The obligor on a Mortgage Note.
"Net Liquidation Proceeds": With respect to any Liquidated
Mortgage
Loan or any other disposition of related
Mortgaged Property (including REO
Property) the related Liquidation Proceeds
net of unreimbursed Advances,
unreimbursed Servicing Advances, unpaid
Servicing Fees and any other accrued and
unpaid servicing fees received and retained
in connection with the liquidation
of such Mortgage Loan or Mortgaged
Property.
"Net Mortgage Interest Rate": With respect to any Mortgage Loan,
the
Mortgage Interest Rate borne by such
Mortgage Loan minus the Expense Fee Rate.
"Net Rate Ceiling": With respect to any Adjustable Rate
Mortgage
Loan, the applicable Rate Ceiling minus the
Expense Fee Rate.
"Nonrecoverable Advance": Any Advance or Servicing Advance
previously made or proposed to be made in
respect of a Mortgage Loan that, in
the good faith business judgment of the
Servicer (or the Trustee, in the case of
any Advance made by the Trustee pursuant to
Section 7.01), will not or, in the
case of a proposed Advance or Servicing
Advance, would not be ultimately
recoverable from Late Collections on such
Mortgage Loan as provided herein.
"Notional Amount": With respect to the Class CE Certificates,
an
amount equal to the aggregate principal
balance of the REMIC 1 Regular
Interests.
"NYCEMA": A New York Consolidation, Extension and Modification
Agreement.
"Officers' Certificate": A certificate signed by the Chairman of
the
Board, the Vice Chairman of the Board, the
President, a vice president (however
denominated), and by the Treasurer, the
Secretary, or one of the assistant
treasurers or assistant secretaries of the
Servicer, the Securities
Administrator, the Trustee or the
Depositor, as applicable.
"One-Month LIBOR": With respect to each Interest Accrual Period,
the
rate determined by the Securities
Administrator on the related LIBOR
Determination Date on the basis of the
offered rate for one-month United States
dollar deposits, as such rate appears on
the Telerate Page 3750, as of 11:00
a.m. (London time) on such LIBOR
Determination Date. If no such quotations are
available on an LIBOR Determination Date,
One-Month LIBOR for the related
Interest Accrual Period will be established
by the Securities Administrator as
follows:
(i) If on such LIBOR Determination Date two or more Reference
Banks
provide
such offered quotations, One-Month LIBOR for the related
Interest
Accrual
Period shall be the arithmetic mean of such offered quotations
(rounded
upwards if necessary to the nearest whole multiple of 0.001%);
(ii) If on such LIBOR Determination Date fewer than two
Reference
Banks
provide such offered quotations, One-Month LIBOR for the
related
Interest
Accrual Period shall be the arithmetic mean of the rates quoted
by one or
more major banks in New York City, selected by the Securities
Administrator after consultation with the Depositor, as of 11:00
A.M., New
York City
time, on such date for loans in U.S. Dollars to leading
European
banks for
a period of one month in amounts approximately equal to the
aggregate
Principal Balance of the Floating Rate Classes; and
(iii) If no such quotations can be obtained, One-Month LIBOR for
the
related
Interest Accrual Period shall be One-Month LIBOR for the prior
Distribution Date.
"Opinion of Counsel": A written opinion of counsel, who may,
without
limitation, be a salaried counsel for the
Depositor, the Securities
Administrator, the Trustee or the Servicer
except that any opinion of counsel
relating to (a) the qualification of either
REMIC as a REMIC or (b) compliance
with the REMIC Provisions must be an
opinion of Independent counsel.
"Optional Termination Date": The first Distribution Date on
which
the Majority Class CE Certificateholder or,
if there is no Majority Class CE
Certificateholder, the Depositor, may opt
to terminate the Mortgage Pool
pursuant to Section 10.01.
"Original Principal Balance": With respect to each Class of
Certificates, the Principal Balance thereof
on the Closing Date, as set forth
opposite such Class in the Preliminary
Statement, except with respect to (i) the
Class P and Class R Certificates, which
have an Original Principal Balance of
zero and (ii) the Class CE Certificates,
which, solely for REMIC purposes, have
an Original Principal Balance equal to the
Initial Overcollateralization Amount.
"Originator": Wells Fargo Bank, N.A. and its successors.
"Originator Prepayment Penalty Payment Amount": The amount
payable
by the Originator pursuant to Section 5(b)
of the Mortgage Loan Purchase
Agreement.
"Overcollateralization Amount": As of any Distribution Date,
the
excess, if any, of (x) the Pool Balance as
of the last day of the related
Collection Period over (y) the aggregate
Principal Balance of all Classes of
Certificates (other than the Class CE,
Class P and Class R Certificates) after
taking into account all distributions of
principal on such Distribution Date and
the increase of any Principal Balance as a
result of Subsequent Recoveries.
"Overcollateralization Deficiency": As of any Distribution Date,
the
excess, if any, of (x) the Targeted
Overcollateralization Amount for such
Distribution Date over (y) the
Overcollateralization Amount for such
Distribution Date, calculated for this
purpose after taking into account the
reduction on such Distribution Date of the
Principal Balances of all Classes of
Certificates (other than the Class CE,
Class P and Class R Certificates)
resulting from the distribution of the
Principal Distribution Amount (but not
the Extra Principal Distribution Amount) on
such Distribution Date, but prior to
taking into account any Applied Realized
Loss Amount on such Distribution Date.
"Overcollateralization Floor": As of any Distribution Date, the
amount by which the Pool Balance as of the
last day of the related Collection
Period exceeds the product of (i) 0.50% and
(ii) the Pool Balance as of the
Cut-off Date.
"Overcollateralization Release Amount": With respect to any
Distribution Date on or after the Stepdown
Date on which a Trigger Event is not
in effect, the lesser of (x) the Principal
Remittance Amount and (y) the excess,
if any, of (i) the Overcollateralization
Amount for such Distribution Date,
assuming that 100% of the Principal
Remittance Amount is applied as a principal
payment on the Certificates (other than the
Class CE, Class P and Class R
Certificates) on such Distribution Date,
over (ii) the Targeted
Overcollateralization Amount for such
Distribution Date. With respect to any
Distribution Date on which a Trigger Event
is in effect, the
Overcollateralization Release Amount will
be zero.
"Owner Mortgage File": A file maintained by the Custodian for
each
Mortgage Loan that contains the documents
specified in Section 2.01(a) and any
additional documents required to be added
to the Owner Mortgage File pursuant to
this Agreement.
"Ownership Interest": As to any Certificate, any ownership or
security 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, as owner
or as pledgee.
"Pass-Through Rate": With respect to any REMIC Regular Interest
(other than the Class CE Certificates), the
Pass-Through Rate described for such
Class in the table in the Preliminary
Statement. With respect to the Class CE
Certificates and any Distribution Date, a
per annum rate equal to the percentage
equivalent of a fraction, the numerator of
which is the sum of the amounts
calculated pursuant to clauses (A) through
(U) below, and the denominator of
which is the aggregate of the
Uncertificated Principal Balances of REMIC 1
Regular Interest LT1AI1A, REMIC 1 Regular
Interest LT1AI1B, REMIC 1 Regular
Interest LT1AII1, REMIC 1 Regular Interest
LT1M1, REMIC 1 Regular Interest
LT1M2, REMIC 1 Regular Interest LT1M3,
REMIC 1 Regular Interest LT1M4, REMIC 1
Regular Interest LT1M5, REMIC 1 Regular
Interest LT1M6, REMIC 1 Regular Interest
LT1M7, REMIC 1 Regular Interest LT1M8,
REMIC 1 Regular Interest LT1M9, REMIC 1
Regular Interest LT1M10, REMIC 1 Regular
Interest LT1M11, REMIC 1 Regular
Interest LT1M12, REMIC 1 Regular Interest
LT1M13, REMIC 1 Regular Interest
LT1M14 and REMIC 1 Regular Interest LT1ZZ.
For purposes of calculating the
Pass-Through Rate for the Class CE
Certificates, the numerator is equal to the
sum of the following components:
(A) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1AA minus the Marker Rate,
applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1
Regular Interest LT1AA;
(B) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1AI1A minus the Marker Rate,
applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1
Regular Interest LT1AI1A;
(C) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1AI1B minus the Marker Rate,
applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1
Regular Interest LT1AI1B;
(D) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1AII1 minus the Marker Rate,
applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1
Regular Interest LT1AII1;
(E) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M1 minus the Marker Rate,
applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M1;
(F) the
Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1M2 minus the Marker Rate,
applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M2;
(G) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M3 minus the Marker Rate,
applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M3;
(H) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M4 minus the Marker Rate,
applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M4;
(I) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M5 minus the Marker Rate,
applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M5;
(L) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M6 minus the Marker Rate,
applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M6;
(M) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M7 minus the Marker Rate,
applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M7;
(N) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M8A minus the Marker Rate,
applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M8;
(O) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M9 minus the Marker Rate,
applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M9;
(P) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M10 minus the Marker Rate,
applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M10;
(Q) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M11 minus the Marker Rate,
applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M11;
(R) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M12 minus the Marker Rate,
applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M12;
(S) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M13 minus the Marker Rate,
applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M13;
(T) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1M14 minus the Marker Rate,
applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M14; and
(U) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular
Interest LT1ZZ minus the Marker Rate,
applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1
Regular Interest LT1ZZ.
"Paying Agent": Any paying agent appointed pursuant to Section
5.05.
"Percentage Interest": With respect to any Certificate (other than
a
Class CE, Class P or Class R Certificate),
a fraction, expressed as a
percentage, the numerator of which is the
Initial Principal Balance, as the case
may be, represented by such Certificate and
the denominator of which is the
Original Principal Balance of the related
Class. With respect to a Class CE or
Class P Certificate, the portion of the
Class evidenced thereby, expressed as a
percentage, as stated on the face of such
Certificate; provided, however, that
the sum of all such percentages for each
such Class totals 100%. With respect to
the Class R Certificate, 100%.
"Periodic Cap": With respect to each Adjustable Rate Mortgage
Loan,
the applicable limit on adjustment of the
Mortgage Interest Rate for each
Adjustment Date specified in the applicable
Mortgage Note and designated as such
in the Mortgage Loan Schedules.
"Permitted Transferee": Any transferee of a Class R Certificate
other than a Disqualified Organization, a
non-U.S. Person or a U.S. Person with
respect to whom income on the Class R
Certificate is attributable to a foreign
permanent establishment or fixed base,
within the meaning of an applicable
income tax treaty, of such Person or any
other U.S. Person.
"Person": Any individual, corporation, partnership, joint
venture,
association, joint stock company, trust,
limited liability company,
unincorporated organization or government
or any agency or political subdivision
thereof.
"Pool Balance": As of any date of determination, the aggregate
unpaid principal balance of the Mortgage
Loans.
"Pool
Cap": As of any Distribution Date and for the Class M
Certificates, a per annum rate (adjusted by
multiplying such rate by a fraction
equal to 30 over the actual number of days
in the related Interest Accrual
Period), equal to the weighted average of
the Group I Cap and the Group II Cap,
weighted on the basis of the related Group
Subordinate Amount. For federal
income tax purposes, the economic
equivalent of such rate shall be expressed as
the weighted average of the REMIC 1
Remittance Rate on (a) REMIC 1 Regular
Interest LT1SUB, subject to a cap and floor
equal to the Weighted Average Net
Mortgage Interest Rates of the Group I
Mortgage Loans and (b) REMIC 1 Regular
Interest LT2SUB, subject to a cap and floor
equal to the Weighted Average Net
Mortgage Interest Rates of the Group II
Mortgage Loans, weighted on the basis of
the Uncertificated Balance of such REMIC 1
Regular Interests.
"Pool Maximum Rate Cap": With respect to any Distribution Date
and
for the Class M Certificates, a per annum
rate (adjusted by multiplying such
rate by a fraction equal to 30 over the
actual number of days in the related
Interest Accrual Period), equal to the
weighted average of (i) Group I Maximum
Rate Cap and (ii) the Group II Maximum Rate
Cap, weighted on the basis of the
related Group Subordinate Amount.
"Prepayment Interest Shortfall": With respect to any
Distribution
Date, for each Mortgage Loan that was the
subject of a Principal Prepayment
during the related Prepayment Period that
was applied by the Servicer to reduce
the outstanding Principal Balance of such
Mortgage Loan on a date preceding the
related Due Date, an amount equal to
interest at the applicable Mortgage
Interest Rate (net of the Servicing Fee
Rate) on the amount of such Principal
Prepayment for the number of days
commencing on the date on which the Principal
Prepayment is applied and ending on the
last day of the calendar month in which
applied.
"Prepayment Penalty": With respect to any Prepayment Period,
any
Prepayment Penalty, penalty or charge
collected by the Servicer from a Mortgagor
in connection with any voluntary Principal
Prepayment in full pursuant to the
terms of the related Mortgage Note as from
time to time held as a part of the
Trust Fund, the Prepayment Penalties so
held being determined in accordance with
the guidelines for Prepayment Penalty
provisions set forth in the Seller
underwriting standards. The defined term
"Prepayment Penalty" shall not include
any Servicer Prepayment Penalty Payment
Amount or Originator Prepayment Penalty
Payment Amount.
"Prepayment Period": With respect to any Distribution Date, the
one
month period ending on the last day of the
calendar month preceding the month in
which such Distribution Date occurs.
"Principal Balance": With respect to any Class of Certificates
(other than the Class CE, Class P and Class
R Certificates) and any Distribution
Date, the Original Principal Balance (a)
reduced by the sum of (i) all amounts
actually distributed in respect of
principal of such Class on all prior
Distribution Dates and (ii) Applied
Realized Loss Amounts allocated thereto for
previous Distribution Dates and (b)
increased by any Subsequent Recoveries
allocated to such Class for previous
Distribution Dates. The Class CE, Class P
and Class R Certificates do not have a
Principal Balance. With respect to any
Certificate (other than a Class CE, Class P
or Class R Certificate) of a Class
and any Distribution Date, the portion of
the Principal Balance of such Class
represented by such Certificate equal to
the product of the Percentage Interest
evidenced by such Certificate and the
Principal Balance of such Class.
"Principal Distribution Amount": With respect to any
Distribution
Date, (a) the sum of (i) the Principal
Remittance Amount and (ii) the Extra
Principal Distribution Amount, if any,
minus the Overcollateralization Release
Amount.
"Principal Prepayment": Any payment of principal made by the
Mortgagor on a Mortgage Loan which is
received in advance of its scheduled Due
Date and which is not accompanied by an
amount of interest representing the full
amount of scheduled interest due on any Due
Date in any month or months
subsequent to the month of prepayment.
"Principal Remittance Amount": With respect to any Distribution
Date, to the extent of funds available
therefor, the sum (less amounts available
for reimbursement of Advances and Servicing
Advances pursuant to Section 3.05
and expenses reimbursable pursuant to
Section 6.03 and amounts reimbursable or
payable to the Securities Administrator or
Trustee pursuant to this Agreement,
including, without limitation, Sections
8.05 and Section 9.01(c)) of: (i) each
payment of principal on a Mortgage Loan due
during the related Collection Period
and received by the Servicer on or prior to
the related Determination Date, and
any Advances with respect thereto (other
than any payment received on an
Eligible Substitute Mortgage Loan
substituted during the related Collection
Period), (ii) all full and partial
Principal Prepayments received by the
Servicer during the related Prepayment
Period, (iii) Subsequent Recoveries,
Insurance Proceeds and Net Liquidation
Proceeds allocable to principal actually
collected by the Servicer during the
related Prepayment Period, (iv) with
respect to Defective Mortgage Loans
repurchased with respect to such Prepayment
Period, the portion of the Purchase Price
allocable to principal, (v) any
Substitution Adjustment Amounts received
during the related Prepayment Period
and (vi) on the Distribution Date on which
the Trust is to be terminated in
accordance with Section 10.01 hereof, that
portion of the Termination Price in
respect of principal.
"Private Certificates": Any of the Class M-12, Class M-13,
Class
M-14, Class CE, Class P and Class R
Certificates.
"Prospectus Supplement": That certain Prospectus Supplement
dated
June 27, 2005 relating to the public
offering of the Class A Certificates and
the Class M Certificates (other than the
Class M-12, Class M-13 and Class M-14
Certificates).
"Purchase Price": With respect to any Mortgage Loan or REO
Property
to be purchased pursuant to or as
contemplated by Section 2.01, 2.03, 3.16 or
10.01 (or substituted pursuant to Section
2.08), an amount equal to the sum of
(i) 100% of the unpaid principal balance
thereof as of the date of purchase (or
such other price as provided in Section
10.01), (ii) in the case of a Mortgage
Loan, accrued interest on such unpaid
principal balance at the applicable
Mortgage Interest Rate in effect from time
to time from the Due Date as to which
interest was last covered by a payment by
the Mortgagor or an Advance by the
Servicer, which payment or Advance had as
of the date of purchase been
distributed pursuant to Section 4.01,
through the end of the calendar month in
which the purchase is to be effected, (iii)
any unreimbursed Servicing Advances
and Advances and any unpaid Servicing Fees
allocable to such Mortgage Loan or
REO Property, (iv) any amounts previously
withdrawn from the Collection Account
in respect of such Mortgage Loan or REO
Property pursuant to Section 3.13 and
(v) in the case of a Mortgage Loan required
to be purchased pursuant to Section
2.03, expenses reasonably incurred or to be
incurred by the Servicer, the
Securities Administrator or the Trustee in
respect of the breach or defect
giving rise to the purchase obligation.
"Rate Ceiling": With respect to each Adjustable Rate Mortgage
Loan,
the maximum per annum Mortgage Interest
Rate permitted under the related
Mortgage Note.
"Rating Agency or Rating Agencies": Fitch, Moody's and S&P, or
their
respective successors. If such agencies or
their successors are no longer in
existence, "Rating Agencies" shall be such
nationally recognized statistical
rating organizations as set forth on the
most current list of such organizations
released by the Commission and designated
by the Depositor, notice of which
designation shall be given to the Trustee,
the Securities Administrator and the
Servicer.
"Realized Loss": With respect to a Liquidated Mortgage Loan,
the
amount by which the remaining unpaid
principal balance of the Mortgage Loan
exceeds the amount of Net Liquidation
Proceeds applied to the principal balance
of the related Mortgage Loan. With respect
to any Mortgage Loan, a Deficient
Valuation or a reduction in the Principal
Balance thereof resulting from a
Servicer Modification.
"Realized Loss Amortization Amount": Any of the Class M-1
Realized
Loss Amortization Amount, the Class M-2
Realized Loss Amortization Amount, the
Class M-3 Realized Loss Amortization
Amount, the Class M-4 Realized Loss
Amortization Amount, the Class M-5 Realized
Loss Amortization Amount, the Class
M-6 Realized Loss Amortization Amount, the
Class M-7 Realized Loss Amortization
Amount, the Class M-8 Realized Loss
Amortization Amount, the Class M-9 Realized
Loss Amortization Amount, the Class M-10
Realized Loss Amortization Amount, the
Class M-11 Realized Loss Amortization
Amount, the Class M-12 Realized Loss
Amortization Amount, the Class M-13
Realized Loss Amortization Amount and the
Class M-14 Realized Loss Amortization
Amount.
"Record Date": With respect to any Distribution Date and (i)
the
Class CE and Class P Certificates, the last
Business Day of the preceding month
and (ii) any Class of Book-Entry
Certificates, the Business Day immediately
preceding such Distribution Date; provided,
however, that if any Book-Entry
Certificate becomes a Definitive
Certificate, the Record Date for such Class
shall be the last Business Day of the
immediately preceding month.
"Reference Banks": Initially, the Reference Banks shall be
Deutsche
Bank International, Bank of America, N.A.,
Citibank, N.A., and The Fuji Bank,
Limited. If any of these banks are not
available, the Securities Administrator
shall select from one of the following
banks a substitute Reference Bank: Credit
Suisse First Boston Corporation,
Westdeutsche Landesbank Girozentrale, The J.P.
Morgan Chase Bank or National Westminster
Bank Plc. If any of these banks are
not available, the Securities Administrator
shall in its discretion select
another Reference Bank.
"Regular Certificate": Any of the Class A, Class M and Class CE
Certificates.
"Reimbursement Amount": With respect to any Mortgage Loan, any
costs
or damages incurred by the Trust in
connection with a breach of the Depositor's
representations set forth in Section
2.04(i) and (dd) hereof.
"Related Documents": With respect to any Mortgage Loan, the
related
Mortgage Notes, Mortgages and other related
documents.
"Relief Act": The Servicemembers Civil Relief Act, as it may be
amended from time to time.
"Relief Act Interest Shortfall": With respect to any
Distribution
Date, for any Mortgage Loan with respect to
which there has been a reduction in
the amount of interest collectible thereon
for the most recently ended
Collection Period as a result of the
application of the Relief Act or similar
state laws, the amount by which (i)
interest collectible on such Mortgage Loan
during such Collection Period is less than
(ii) one month's interest on the
principal balance of such Mortgage Loan at
the Mortgage Interest Rate for such
Mortgage Loan before giving effect to the
application of the Relief Act or
similar state laws.
"REMIC": A "real estate mortgage investment conduit" within the
meaning of Section 860D of the Code.
"REMIC 1 Interest Loss Allocation Amount": With respect to any
Distribution Date, an amount equal to (a)
the product of (i) 50% of the sum of
the aggregate Principal Balance of the
Mortgage Loans and related REO Properties
then outstanding and (ii) the
Uncertificated REMIC 1 Pass-Through Rate for REMIC
1 Regular Interest LT1AA minus the Marker
Rate, divided by (b) 12.
"REMIC 1 Marker Allocation Percentage": 50% of any amount
payable
from or loss attributable to the Mortgage
Loans, which shall be allocated to
REMIC 1 Regular Interest LT1AA, REMIC 1
Regular Interest LT1AI1A, REMIC 1
Regular Interest LT1AI1B, REMIC 1 Regular
Interest LT1AII1, REMIC 1 Regular
Interest LT1M1, REMIC 1 Regular Interest
LT1M2, REMIC 1 Regular Interest LT1M3,
REMIC 1 Regular Interest LT1M4, REMIC 1
Regular Interest LT1M5, REMIC 1 Regular
Interest LT1M6, REMIC 1 Regular Interest
LT1M7, REMIC 1 Regular Interest LT1M8,
REMIC 1 Regular Interest LT1M9, REMIC 1
Regular Interest LT1M10, REMIC 1 Regular
Interest LT1M11, REMIC 1 Regular Interest
LT1M12, REMIC 1 Regular Interest
LT1M13, REMIC 1 Regular Interest LT1M14 and
REMIC 1 Regular Interest LT1ZZ.
"REMIC 1 Overcollateralization Target Amount": 0.50% of the
Targeted
Overcollateralization Amount.
"REMIC 1 Overcollateralized Amount": With respect to any date
of
determination, (i) 0.50% of the aggregate
Uncertificated Principal Balances of
the REMIC 1 Regular Interests minus (ii)
the aggregate of the Uncertificated
Principal Balances of REMIC 1 Regular
Interest LT1AI1A, REMIC 1 Regular Interest
LT1AI1B, REMIC 1 Regular Interest LT1AII1,
REMIC 1 Regular Interest LT1M1, REMIC
1 Regular Interest LT1M2, REMIC 1 Regular
Interest LT1M3, REMIC 1 Regular
Interest LT1M4, REMIC 1 Regular Interest
LT1M5, REMIC 1 Regular Interest LT1M6,
REMIC 1 Regular Interest LT1M7, REMIC 1
Regular Interest LT1M8, REMIC 1 Regular
Interest LT1M9, REMIC 1 Regular Interest
LT1M10, REMIC 1 Regular Interest
LT1M11, REMIC 1 Regular Interest LT1M12,
REMIC 1 Regular Interest LT1M13 and
REMIC 1 Regular Interest LT1M14, in each
case as of such date of determination.
"REMIC 1 Principal Loss Allocation Amount": With respect to any
Distribution Date, an amount equal to (a)
the product of (i) 50% of the
aggregate Principal Balance of the Mortgage
Loans and related REO Properties
then outstanding and (ii) 1 minus a
fraction, the numerator of which is two
times the aggregate of the Uncertificated
Principal Balances of REMIC 1 Regular
Interest LT1AI1A, REMIC 1 Regular Interest
LT1AI1B, REMIC 1 Regular Interest
LT1AII1, REMIC 1 Regular Interest LT1M1,
REMIC 1 Regular Interest LT1M2, REMIC 1
Regular Interest LT1M3, REMIC 1 Regular
Interest LT1M4, REMIC 1 Regular Interest
LT1M5, REMIC 1 Regular Interest LT1M6,
REMIC 1 Regular Interest LT1M7, REMIC 1
Regular Interest LT1M8, REMIC 1 Regular
Interest LT1M9, REMIC 1 Regular Interest
LT1M10, REMIC 1 Regular Interest LT1M11,
REMIC 1 Regular Interest LT1M12, REMIC
1 Regular Interest LT1M13 and REMIC 1
Regular Interest LT1M14, the denominator
of which is aggregate of the Uncertificated
Principal Balances of REMIC 1
Regular Interest LT1AI1A, REMIC 1 Regular
Interest LT1AI1B, REMIC 1 Regular
Interest LT1AII1, REMIC 1 Regular Interest
LT1M1, REMIC 1 Regular Interest
LT1M2, REMIC 1 Regular Interest LT1M3,
REMIC 1 Regular Interest LT1M4, REMIC 1
Regular Interest LT1M5, REMIC 1 Regular
Interest LT1M6, REMIC 1 Regular Interest
LT1M7, REMIC 1 Regular Interest LT1M8,
REMIC 1 Regular Interest LT1M9, REMIC 1
Regular Interest LT1M10, REMIC 1 Regular
Interest LT1M11, REMIC 1 Regular
Interest LT1M12, REMIC 1 Regular Interest
LT1M13, REMIC 1 Regular Interest
LT1M14 and REMIC 1 Regular Interest
LT1ZZ.
"REMIC 1 Regular Interest LT1AA": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT1AA
shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be
entitled to distributions of principal,
subject to the terms and conditions hereof,
in an aggregate amount equal to its
initial Uncertificated Principal Balance as
set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1AI1A": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT1AI1A
shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be
entitled to distributions of principal,
subject to the terms and conditions hereof,
in an aggregate amount equal to its
initial Uncertificated Principal Balance as
set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1AI1B": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT1AI1B
shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be
entitled to distributions of principal,
subject to the terms and conditions hereof,
in an aggregate amount equal to its
initial Uncertificated Principal Balance as
set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1AII1": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT1AII1
shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be
entitled to distributions of principal,
subject to the terms and conditions hereof,
in an aggregate amount equal to its
initial Uncertificated Principal Balance as
set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M1": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT1M1
shall accrue interest at the related
Uncertificated REMIC 1 Pass- Through Rate
in effect from time to time, and shall be
entitled to distributions of
principal, subject to the terms and
conditions hereof, in an aggregate amount
equal to its initial Uncertificated
Principal Balance as set forth in the
Preliminary Statement hereto.
"REMIC 1 Regular Interest LT1M2": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT1M2
shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be
entitled to distributions of principal,
subject to the terms and conditions hereof,
in an aggregate amount equal to its
initial Uncertificated Principal Balance as
set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M3": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT1M3
shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be
entitled to distributions of principal,
subject to the terms and conditions hereof,
in an aggregate amount equal to its
initial Uncertificated Principal Balance as
set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M4": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT1M4
shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be
entitled to distributions of principal,
subject to the terms and conditions hereof,
in an aggregate amount equal to its
initial Uncertificated Principal Balance as
set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M5": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT1M5
shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be
entitled to distributions of principal,
subject to the terms and conditions hereof,
in an aggregate amount equal to its
initial Uncertificated Principal Balance as
set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M6": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT1M6
shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be
entitled to distributions of principal,
subject to the terms and conditions hereof,
in an aggregate amount equal to its
initial Uncertificated Principal Balance as
set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M7": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT1M7
shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be
entitled to distributions of principal,
subject to the terms and conditions hereof,
in an aggregate amount equal to its
initial Uncertificated Principal Balance as
set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M8": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT1M8
shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be
entitled to distributions of principal,
subject to the terms and conditions hereof,
in an aggregate amount equal to its
initial Uncertificated Principal Balance as
set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M9": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT1M9
shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be
entitled to distributions of principal,
subject to the terms and conditions hereof,
in an aggregate amount equal to its
initial Uncertificated Principal Balance as
set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M10": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT1M10
shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be
entitled to distributions of principal,
subject to the terms and conditions hereof,
in an aggregate amount equal to its
initial Uncertificated Principal Balance as
set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M11": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT1M11
shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be
entitled to distributions of principal,
subject to the terms and conditions hereof,
in an aggregate amount equal to its
initial Uncertificated Principal Balance as
set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M12": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT1M12
shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be
entitled to distributions of principal,
subject to the terms and conditions hereof,
in an aggregate amount equal to its
initial Uncertificated Principal Balance as
set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M13": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT1M13
shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be
entitled to distributions of principal,
subject to the terms and conditions hereof,
in an aggregate amount equal to its
initial Uncertificated Principal Balance as
set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M14": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT1M14
shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be
entitled to distributions of principal,
subject to the terms and conditions hereof,
in an aggregate amount equal to its
initial Uncertificated Principal Balance as
set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1SUB": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT1SUB
shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be
entitled to distributions of principal,
subject to the terms and conditions hereof,
in an aggregate amount equal to its
initial Uncertificated Principal Balance as
set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1XX": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT1XX
shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be
entitled to distributions of principal,
subject to the terms and conditions hereof,
in an aggregate amount equal to its
initial Uncertificated Principal Balance as
set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1ZZ": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT1ZZ
shall accrue interest at the related
Uncertificated REMIC 1 Pass- Through Rate
in effect from time to time, and shall be
entitled to distributions of
principal, subject to the terms and
conditions hereof, in an aggregate amount
equal to its initial Uncertificated
Principal Balance as set forth in the
Preliminary Statement hereto.
"REMIC 1 Regular Interest LT2GRP": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT2GRP
shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be
entitled to distributions of principal,
subject to the terms and conditions hereof,
in an aggregate amount equal to its
initial Uncertificated Principal Balance as
set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT2SUB": One of the separate
non-certificated beneficial ownership
interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC
1. REMIC 1 Regular Interest LT2SUB
shall accrue interest at the related
Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be
entitled to distributions of principal,
subject to the terms and conditions hereof,
in an aggregate amount equal to its
initial Uncertificated Principal Balance as
set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interests": REMIC 1 Regular Interest LT1AA, REMIC
1
Regular Interest LT1AI1A, REMIC 1 Regular
Interest LT1AI1B, REMIC 1 Regular
Interest LT1AII1, REMIC 1 Regular Interest
LT1M1, REMIC 1 Regular Interest
LT1M2, REMIC 1 Regular Interest LT1M3,
REMIC 1 Regular Interest LT1M4, REMIC 1
Regular Interest LT1M5, REMIC 1 Regular
Interest LT1M6, REMIC 1 Regular Interest
LT1M7, REMIC 1 Regular Interest LT1M8,
REMIC 1 Regular Interest LT1M9, REMIC 1
Regular Interest LT1M10, REMIC 1 Regular
Interest LT1M11, REMIC 1 Regular
Interest LT1M12, REMIC 1 Regular Interest
LT1M13, REMIC 1 Regular Interest
LT1M14, REMIC 1 Regular Interest LT1SUB,
REMIC 1 Regular Interest LT1GRP, REMIC
1 Regular Interest LT2SUB, REMIC 1 Regular
Interest LT2GRP, REMIC 1 Regular
Interest LT1XX and REMIC 1 Regular Interest
LT1ZZ.
"REMIC 1 Sub WAC Allocation Percentage": 50% of any amount
payable
or loss attributable from the Mortgage
Loans, which shall be allocated to REMIC
1 Regular Interest LT1SUB, REMIC 1 Regular
Interest LT1GRP, REMIC 1 Regular
Interest LT2SUB, REMIC 1 Regular Interest
LT2GRP and REMIC 1 Regular Interest
LT1XX.
"REMIC 1 Subordinated Balance Ratio": The ratio among the
Uncertificated Principal Balances of each
REMIC 1 Regular Interest ending with
the designation "SUB," equal to the ratio
among, with respect to each such REMIC
1 Regular Interest, the excess of (x) the
aggregate Principal Balance of the
Mortgage Loans in the related Loan Group
over (y) the current Certificate
Principal Amount of the Class A
Certificates in the related Loan Group.
"REMIC Provisions": Provisions of the federal income tax law
relating to real estate mortgage investment
conduits which appear at Section
860A through 860G of Subchapter M of
Chapter 1 of the Code, and related
provisions, and regulations and rulings
promulgated thereunder, as the foregoing
may be in effect from time to time.
"REMIC Regular Interest": Either REMIC 1 Regular Interest or any
of
the Certificates (other than the Class P
and Class R Certificates).
"Remittance Report": A report prepared by the Servicer and
delivered
to the Securities Administrator pursuant to
Section 4.07, containing the
information attached hereto as Exhibit
M.
"Rents from Real Property": With respect to any REO Property,
gross
income of the character described in
Section 856(d) of the Code.
"REO Disposition": The sale or other disposition of an REO
Property
on behalf of the Trust.
"REO Disposition Fee": The REO Disposition Fee shall be the
greater
of one percent (1%) of the gross sales
price of the REO Property or $1,500.00 up
to a maximum fee of $10,000 per REO
Property.
"REO Imputed Interest": As to any REO Property, for any
Collection
Period, an amount equivalent to interest
(at the Net Mortgage Interest Rate that
would have been applicable to the related
Mortgage Loan had it been outstanding)
for such Collection Period on the unpaid
principal balance of the Mortgage Loan
as of the date of acquisition.
"REO Mortgage Loan": Any Mortgage Loan which is not a
Liquidated
Mortgage Loan and as to which the
indebtedness evidenced by the related Mortgage
Note is discharged and the related
Mortgaged Property is held as part of the
Trust Fund.
"REO Principal Amortization": With respect to any REO Property,
for
any calendar month, the aggregate of all
amounts received in respect of such REO
Property during such calendar month,
whether in the form of rental income, sale
proceeds (including, without limitation,
that portion of the Termination Price
paid in connection with a purchase of all
of the Mortgage Loans and REO
Properties pursuant to Section 10.01 that
is allocable to such REO Property) or
otherwise, net of any portion of such
amounts (i) payable pursuant to Section
3.13 in respect of the proper operation,
management and maintenance of such REO
Property or (ii) payable or reimbursable to
the Servicer pursuant to Section
3.13 for unpaid Servicing Fees in respect
of the related Mortgage Loan and
payable and reimbursable to the Servicer or
the Trustee for unreimbursed
Servicing Advances and Advances in respect
of such REO Property or the related
Mortgage Loan.
"REO Property": A Mortgaged Property acquired by the Servicer
on
behalf of the Trust through foreclosure or
deed-in-lieu of foreclosure, as
described in Section 3.13.
"Request for Release": A release signed by a Servicing Officer,
in
the form of Exhibit E attached hereto.
"Reserve Accounts": Any of the Class AI Reserve Account, the
Class
AII Reserve Account or the Class M Reserve
Account.
"Residential Dwelling": Any one of the following: (i) a
detached
one-family dwelling, (ii) a detached two-
to four-family dwelling, (iii) a
one-family dwelling unit in a condominium
project, (iv) a manufactured home, or
(v) a detached one-family dwelling in a
planned unit development, none of which
is a co-operative or mobile home.
"Residual Interest": The sole Class of "residual interests" in
each
REMIC within the meaning of Section
860G(a)(2) of the Code.
"Responsible Officer": When used with respect to the Trustee or
the
Securities Administrator, any officer
assigned to its Corporate Trust Office (or
any successor thereto), including any Vice
President, Assistant Vice President,
Trust Officer, any Assistant Secretary, any
trust officer or any other officer
of the Trustee or the Securities
Administrator customarily performing functions
similar to those performed by any of the
above designated officers and in each
case having direct responsibility for the
administration of this Agreement.
"Retained Mortgage File": A file maintained by Wells Fargo Bank
prior to any Document Transfer Event for
each Mortgage Loan that contains the
documents specified in Section 2.01(b) and
any additional documents required to
be added to the Retained Mortgage File
pursuant to this Agreement.
"S&P": Standard & Poor's, a division of The McGraw-Hill
Companies,
Inc., and its successors, and if such
company shall for any reason no longer
perform the functions of a securities
rating agency, "S&P" shall be deemed to
refer to any other "nationally recognized
statistical rating organization" as
set forth on the most current list of such
organizations released by the
Commission.
"Sarbanes Oxley Certification": As defined in Section 3.28(b)
hereof.
"Securities Administrator": Wells Fargo Bank, N.A., a national
banking association, or any successor
Securities Administrator appointed as
herein provided.
"Seller": Wells Fargo Bank, N.A., or its successor in interest,
in
its capacity as seller under the Mortgage
Loan Purchase Agreement.
"Senior Certificates": The Class A Certificates.
"Senior Enhancement Percentage": For any Distribution Date, the
percentage obtained by dividing (x) the sum
of (i) the aggregate Principal
Balance of the Class M Certificates before
taking into account the distribution
of the Principal Distribution Amount on
such Distribution Date and (ii) the
Overcollateralization Amount as of the
prior Distribution Date by (y) the Pool
Balance as of the last day of the related
Collection Period.
"Senior Principal Distribution Amount": For any Distribution
Date,
the sum of the Group I Senior Principal
Distribution Amount for such
Distribution Date and the Group II Senior
Principal Distribution Amount for such
Distribution Date.
"Senior Specified Enhancement Percentage": On any date of
determination thereof, 32.60%.
"Sequential Trigger Event": With respect to any Distribution Date
if
(i) the aggregate Principal Balance of the
Class M Certificates is reduced to
zero, (ii) with respect to any Distribution
Date on or prior to the Distribution
Date in July 2007, the aggregate amount of
Realized Losses incurred since the
Cut-off Date through the last day of the
related Collection Period (reduced by
the aggregate amount of Subsequent
Recoveries received since the Cut-off Date
through the last day of the related
Collection Period) divided by the Pool
Balance on the Cut-off Date exceeds 1.25%
or (iii) with respect to any
Distribution Date on or after the
Distribution Date in July 2007, a Trigger
Event is in effect.
"Servicer": Wells Fargo Bank, N.A., or any successor servicer
appointed as herein provided, in its
capacity as Servicer hereunder. Initially
the servicing functions performed by Wells
Fargo Bank shall be performed by the
Wells Fargo Home Mortgage division of Wells
Fargo Bank.
"Servicer Event of Termination": One or more of the events
described
in Section 7.01.
"Servicer Modification": A modification to the terms of a
Mortgage
Loan, in accordance with the terms of
Section 3.01, as to which the Mortgagor is
in default or as to which, in the judgment
of the Servicer, default is
reasonably foreseeable.
"Servicer Prepayment Penalty Payment Amount": The amount payable
by
the Servicer in respect of any waived
Prepayment Penalties pursuant to Section
3.01, which amount shall be equal to the
difference between the amount of
Prepayment Penalty due by a Mortgagor
before any waiver and the actual amount of
the Prepayment Penalty that was paid by the
Mortgagor.
"Servicer Remittance Date": With respect to any Distribution
Date,
the 23rd day of the month of such
Distribution Date, or if such day is not a
Business Day, the preceding Business
Day.
"Servicing Advances": All customary, reasonable and necessary
"out
of pocket" costs and expenses incurred by
the Servicer (including reasonable
attorneys' fees and disbursements) in the
performance of its servicing
obligations, including, but not limited to,
the cost of (i) the preservation,
restoration, inspection and protection of
the Mortgaged Property, (ii) any
enforcement or judicial proceedings,
including foreclosures, (iii) the
management and liquidation of the REO
Property and (iv) compliance with the
obligations under Section 3.08.
"Servicing Fee": With respect to each Mortgage Loan (including
each
REO Property) and for any calendar month,
an amount equal to one month's
interest (or in the event of any payment of
interest which accompanies a
Principal Prepayment in full made by the
Mortgagor during such calendar month,
interest for the number of days covered by
such payment of interest) at the
Servicing Fee Rate on the same principal
amount on which interest on such
Mortgage Loan accrues for such calendar
month.
"Servicing Fee Rate": With respect to each Mortgage Loan, 0.50%
per
annum.
"Servicing Officer": Any officer of the Servicer involved in,
or
responsible for, the administration and
servicing of Mortgage Loans, whose name
and specimen signature appear on a list of
servicing officers furnished by the
Servicer to the Trustee, the Securities
Administrator and the Depositor, as such
list may from time to time be amended.
"Servicing Standard": The standards set forth in Section 3.01.
"Startup Day": As defined in Section 9.01(b) hereof.
"Stayed Funds": Any payment required to be made under the terms
of
the Certificates and this Agreement but
which is not remitted by the Servicer
because the Servicer is the subject of a
proceeding under the Bankruptcy Code
and the making of such remittance is
prohibited by Section 362 of the Bankruptcy
Code.
"Stepdown Date": The earlier to occur of (i) the Distribution
Date
on which the aggregate Principal Balance of
the Class A Certificates is reduced
to zero and (ii) the later to occur of (x)
the Distribution Date in July 2008
and (y) the Distribution Date on which the
Senior Enhancement Percentage is
greater than or equal to the Senior
Specified Enhancement Percentage.
"Subordinated Certificates": The Class M-1, Class M-2, Class
M-3,
Class M-4, Class M-5, Class M-6, Class M-7,
Class M-8, Class M-9, Class M-10,
Class M-11, Class M-12, Class M-13, Class
M-14, Class CE and Class R
Certificates.
"Subsequent Recovery": Any amount (net of reimbursable
expenses)
received on a Mortgage Loan subsequent to
such Mortgage Loan being determined to
be a Liquidated Mortgage Loan that resulted
in a Realized Loss in a prior month.
"Substitution Adjustment Amount": As defined in Section 2.03(d)
hereof.
"Targeted Overcollateralization Amount": As of any Distribution
Date, (x) prior to the Stepdown Date, 0.75%
of the Cut-off Date Aggregate
Principal Balance and (y) on and after the
Stepdown Date, (i) if a Trigger Event
has not occurred for such Distribution
Date, the greater of (A) 1.50% of the
Pool Balance as of the last day of the
related Collection Period and (B) 0.50%
of the Cut-off Date Aggregate Principal
Balance and (ii) if a Trigger Event has
occurred for such Distribution Date, the
Targeted Overcollateralization Amount
for the immediately preceding Distribution
Date.
"Tax Matters Person": The tax matters person appointed pursuant
to
Section 9.01(e) hereof.
"Tax Returns": The federal income tax returns on Internal
Revenue
Service Form 1066, U.S. Real Estate
Mortgage Investment Conduit Income Tax
Return, including Schedule Q thereto,
Quarterly Notice to Residual Interest
Holders of the REMIC Taxable Income or Net
Loss Allocation, or any successor
forms, to be filed on behalf of the Trust
for each of the two REMICs created
pursuant to this Agreement under the REMIC
Provisions, together with any and all
other information reports or returns that
may be required to be furnished to the
Certificateholders or filed with the
Internal Revenue Service or any other
governmental taxing authority under any
applicable provisions of federal, state
or local tax laws.
"Telerate Page 3750": The display page currently so designated
on
the Moneyline Telerate Service (or such
other page as may replace the Telerate
Page 3750 page on that service for the
purpose of displaying London interbank
offered rates of major banks).
"Termination Price": As defined in Section 10.01(a) hereof.
"Trigger Event": With respect to any Distribution Date, if (i)
the
three-month rolling average of 60+ Day
Delinquent Loans equals or exceeds 41.00%
of the Senior Enhancement Percentage or
(ii) the aggregate amount of Realized
Losses incurred since the applicable
Cut-off Date through the last day of the
related Collection Period (reduced by the
aggregate amount of Subsequent
Recoveries received since the applicable
Cut-off Date through the end of the
last day of the related Collection Period)
divided by the Cut-off Date Aggregate
Principal Balance exceeds the applicable
percentages set forth below with
respect to such Distribution Date:
Distribution Date Occurring In Percentage
------------------------------ ----------
July 2007 through June 2008
1.25%
July 2008 through June 2009
2.50%
July 2009 through June 2010
4.00%
July 2010 through June 2011
4.75%
July 2011 and thereafter
5.00%
"Trust": Wells Fargo Home Equity Asset-Backed Securities 2005-1
Trust, the trust created hereunder.
"Trust Fund": The segregated pool of assets subject hereto,
constituting the primary trust created
hereby and to be administered hereunder,
with respect to a portion of which two
REMIC elections are to be made, such
entire Trust Fund consisting of: (i) such
Mortgage Loans as from time to time
are subject to this Agreement, together
with the Mortgage Files relating
thereto, and together with all collections
thereon and proceeds thereof, (ii)
any REO Property, together with all
collections thereon and proceeds thereof,
(iii) the Trustee's rights with respect to
the Mortgage Loans under all
insurance policies required to be
maintained pursuant to this Agreement and any
proceeds thereof, (iv) the Depositor's
rights under the Mortgage Loan Purchase
Agreement (including any security interest
created thereby), (v) the Securities
Administrator's rights under each of the
Yield Maintenance Agreements and (vi)
the Collection Account, the Distribution
Account and the Reserve Accounts and
such assets that are deposited therein from
time to time and any investments
thereof, together with any and all income,
proceeds and payments with respect
thereto.
"Trustee": HSBC Bank USA, National Association, a national
banking
association, in its capacity as trustee
hereunder, or any successor Trustee
appointed as herein provided.
"Uncertificated Accrued Interest": With respect to each REMIC 1
Regular Interest on each Distribution Date,
an amount equal to one month's
interest at the related Uncertificated
Pass-Through Rate on the Uncertificated
Principal Balance of such REMIC Regular
Interest. In each case, Uncertificated
Accrued Interest will be reduced by any
Prepayment Interest Shortfalls and
Relief Act Interest Shortfalls (allocated
to such REMIC Regular Interests based
on their respective entitlements to
interest irrespective of any Prepayment
Interest Shortfalls and Relief Act Interest
Shortfalls for such Distribution
Date).
"Uncertificated Principal Balance": The amount of either REMIC
1
Regular Interest outstanding as of any date
of determination. As of the Closing
Date, the Uncertificated Balance of each
REMIC 1 Regular Interest shall equal
the amount set forth in the Preliminary
Statement hereto as its initial
uncertificated balance. On each
Distribution Date, the Uncertificated Principal
Balance of each REMIC 1 Regular Interest
shall be reduced by all distributions
of principal made on such REMIC 1 Regular
Interest on such Distribution Date
pursuant to Section 4.08 and, if and to the
extent necessary and appropriate,
shall be further reduced on such
Distribution Date by Realized Losses as
provided in Section 4.08(b). The
Uncertificated Balance of REMIC 1 Regular
Interest LT1ZZ shall be increased by
interest deferrals as provided in Section
4.08(a)(i). The Uncertificated Balance of
each REMIC 1 Regular Interest shall
never be less than zero.
"Uncertificated REMIC 1 Pass-Through Rate": With respect to REMIC
1
Regular Interest LT1AA, REMIC 1 Regular
Interest LT1AI1A, REMIC 1 Regular
Interest LT1AI1B, REMIC 1 Regular Interest
LT1AII1, REMIC 1 Regular Interest
LT1M1, REMIC 1 Regular Interest LT1M2,
REMIC 1 Regular Interest LT1M3, REMIC 1
Regular Interest LT1M4, REMIC 1 Regular
Interest LT1M5, REMIC 1 Regular Interest
LT1M6, REMIC 1 Regular Interest LT1M7,
REMIC 1 Regular Interest LT1M8, REMIC 1
Regular Interest LT1M9, REMIC 1 Regular
Interest LT1M10, REMIC 1 Regular
Interest LT1M11, REMIC 1 Regular Interest
LT1M12, REMIC 1 Regular Interest
LT1M13, REMIC 1 Regular Interest LT1M14,
REMIC 1 Regular Interest LT1ZZ, REMIC 1
Regular Interest LT1SUB, REMIC 1 Regular
Interest LT2SUB and REMIC 1 Regular
Interest LT1XX, the Weighted Average Net
Mortgage Rate of the Mortgage Loans.
With respect to REMIC 1 Regular Interest
LT1GRP, the Weighted Average Net
Mortgage Rate of the Group I Mortgage
Loans. With respect REMIC 1 Regular
Interest LT2GRP, the Weighted Average Net
Mortgage Interest Rate of the Group II
Mortgage Loans.
"United States Person" or "U.S. Person": (i) A citizen or
resident
of the United States, (ii) a corporation,
partnership or other entity treated as
a corporation or partnership for United
States federal income tax purposes
organized in or under the laws of the
United States or any state thereof or the
District of Columbia (unless, in the case
of a partnership, Treasury Regulations
provide otherwise), (iii) an estate the
income of which is includible in gross
income for United States tax purposes,
regardless of its source, or (iv) 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. Notwithstanding the
preceding sentence, to the extent provided
in Treasury Regulations, certain
Trusts in existence on August 20, 1996, and
treated as United States persons
prior to such date, that elect to continue
to be treated as United States
persons will also be a U.S. Person;
provided, that for purposes of the
definition of a "Permitted Transferee," a
U.S. Person shall not include any
person whose income is attributable to a
foreign permanent establishment or
fixed base, within the meaning of an
applicable income tax treaty, of such
Person or any other Person.
"Unpaid Realized Loss Amount": For any Class M-1, Class M-2,
Class
M-3, Class M-4, Class M-5, Class M-6, Class
M-7, Class M-8, Class M-9, Class
M-10, Class M-11, Class M-12, Class M-13
and Class M-14 Certificates and as to
any Distribution Date, the excess of (x)
the aggregate Applied Realized Loss
Amounts applied with respect to such Class
for all prior Distribution Dates over
(y) the sum of (a) the aggregate amount of
any Subsequent Recoveries allocated
to such Class and (b) the aggregate
Realized Loss Amortization Amounts with
respect to such Class for all prior
Distribution Dates.
"Value": With respect to any Mortgaged Property, the value
thereof
as determined by an independent appraisal
made at the time of the origination of
the related Mortgage Loan or the sale
price, if the appraisal is not available.
"Voting Interests": The portion of the voting rights of all of
the
Certificates which is allocated to any
Certificate. The Voting Interests
allocated among Holders of the Certificates
(other than the Class CE, Class P
and Class R Certificates) shall be 98%, and
shall be allocated among each such
Class according to the fraction, expressed
as a percentage, the numerator of
which is the aggregate Principal Balance of
all the Certificates of such Class
then outstanding and the denominator of
which is the aggregate Principal Balance
of all the Certificates (other than the
Class CE, Class P and Class R
Certificates) then outstanding. The Voting
Interests allocated to each such
Class of Certificates shall be allocated
among all holders of each such Class in
proportion to the outstanding Principal
Balance of such Certificates; provided,
however, that any Certificate registered in
the name of the Servicer, the
Depositor, the Securities Administrator or
the Trustee or any of their
respective affiliates shall not be included
in the calculation of Voting
Interests; provided that only such
Certificates as are known by a Responsible
Officer of the Securities Administrator to
be so registered will be so excluded.
1% of all the Voting Interests will be
allocated to the Holders of each of the
Class CE and Class P Certificates. The
Class R Certificates shall have no Voting
Interests.
"Weighted Average Net Mortgage Rate": The weighted average (based
on
the unpaid principal balance as of the
first day of the related Collection
Period or, in the case of the first
Distribution Date, the applicable Cut-Off
Date) of the Net Mortgage Interest Rates of
the Mortgage Loans, the Group I
Mortgage Loans or the Group II Mortgage
Loans, as applicable, expressed for each
such Mortgage Loan as an annual rate and
calculated on the basis of twelve
months consisting of 30 days each and a
360-day year.
"Wells Fargo Bank": Wells Fargo Bank, N.A., or its successor in
interest.
"Wells Fargo Bank Correspondents": The entities identified on a
list
provided by Wells Fargo Bank to the
Servicer, from which Wells Fargo Bank
purchased the Mortgage Loans.
"Written Order to Authenticate": A written order by which the
Depositor directing the Securities
Administrator to execute, authenticate and
deliver the Certificates.
"Yield Maintenance Agreement": Any of the Class AI Yield
Maintenance
Agreement, the Class AII Yield Maintenance
Agreement or the Class M Yield
Maintenance Agreement.
"Yield Maintenance Agreement Payment": Any of the Class AI
Yield
Maintenance Agreement Payment, the Class
AII Yield Maintenance Agreement Payment
or the Class M Yield Maintenance Agreement
Payment.
"Yield Maintenance Agreement Provider": Bear Stearns Financial
Products Inc., and any successor
thereto.
Section 1.02 Accounting.
Unless otherwise specified herein, for the purpose of any
definition
or calculation, whenever amounts are
required to be netted, subtracted or added
or any distributions are taken into account
such definition or calculation and
any related definitions or calculations
shall be determined without duplication
of such functions.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01 Conveyance of Mortgage Loans.
(a) The Depositor, concurrently with the execution and delivery
hereof, does hereby transfer, assign, set
over and otherwise convey to the
Trustee, on behalf of the Trust, without
recourse for the benefit of the
Certificateholders all the right, title and
interest of the Depositor, including
any security interest therein for the
benefit of the Depositor, in and to (i)
each Mortgage Loan identified on the
Mortgage Loan Schedules, including the
related Cut-off Date Principal Balance, all
interest accruing thereon after the
applicable Cut-off Date and all collections
in respect of interest and principal
due after the applicable Cut-off Date; (ii)
property which secured each such
Mortgage Loan and which has been acquired
by foreclosure or deed in lieu of
foreclosure; (iii) its interest in any
insurance policies in respect of the
Mortgage Loans; (iv) all other assets
included or to be included in the Trust
Fund; (v) all proceeds of any of the
foregoing; and (vi) the rights of the
Depositor under the Mortgage Loan Purchase
Agreement. Such assignment includes
all interest and principal due to the
Depositor or the Servicer after the
applicable Cut-off Date with respect to the
Mortgage Loans. It is agreed and
understood by the Depositor and the Trustee
that it is not intended that any
mortgage loan be included in the Trust Fund
that is a "High-Cost Home Loan" as
defined in (i) the New Jersey Home
Ownership Act effective November 27, 2003,
(ii) the New Mexico Home Loan Protection
Act effective January 1, 2004, (iii)
the Massachusetts Predatory Home Loan
Practices Act, effective November 7, 2004
or (iv) the Indiana Home Loan Practices
Act, effective January 1, 2005.
In connection with such assignment, the Depositor shall, with
respect to each Mortgage Loan, deliver, or
cause to be delivered, to the
Custodian, on or before the Closing Date
the following documents or instruments
with respect to each Mortgage Loan:
(i) The original Mortgage Note either (A) endorsed in blank or
(B)
endorsed
as provided in Section 2.01(d), with all prior and intervening
endorsements as may be necessary to show a complete chain of
endorsements
or with
respect to any Mortgage Loan as to which the original Mortgage
Note has
been permanently lost or destroyed and has not been replaced, a
lost note
affidavit with a copy of the Mortgage Note and, in the case of
any
Mortgage Loan originated in the State of New York documented by
a
NYCEMA,
the NYCEMA, the new Mortgage Note, if applicable, the
consolidated
Mortgage
Note and the consolidated Mortgage;
(ii) A recorded original assignment of the related Mortgage
from
Wells
Fargo Bank assigning the related Mortgage to the Trustee,
certified
by the
recording office, or, if such assignment is in the process of
being
recorded, a copy of the related
Mortgage transmitted for recordation
certified
by an officer of Wells Fargo Bank or applicable Wells Fargo
Bank
Correspondent to be a true and correct copy of such assignment
submitted
for
recordation; provided, however, if recordation is not required
as
described
below, an assignment in recordable form (which may be assigned
in blank)
with respect to the related Mortgage;
(iii) The original of each assumption agreement, modification,
written
assurance or substitution agreement pertaining to such Mortgage
Note, if
any; and
(iv) For each Mortgage Loan secured by Co-op Shares, the
originals
of the
following documents or instruments:
(A) The loan security agreement;
(B) The stock certificate;
(C) The stock power, executed in blank;
(D) The executed proprietary lease;
(E) The executed recognition agreement;
(F) The executed UCC-1 financing statement with evidence of
recording thereon; and
(G) The executed UCC-3 financing statements or other
appropriate UCC financing statements required by state law,
evidencing a complete and unbroken chain from the mortgagee to
the
Trustee with evidence of recording thereon (or in a form
suitable
for recordation).
(b) Following a Document Transfer Event, the Seller shall, with
respect to each Mortgage Loan, deliver, or
cause to be delivered, to the
corporate trust services division of the
Custodian within 60 days copies (which
may be in electronic form mutually agreed
upon by the Seller and the Custodian)
of the following additional documents or
instruments with respect to each
Mortgage Loan; provided, however, that
originals of such documents or
instruments shall be delivered to the
Custodian if originals are required under
the law in which the related Mortgaged
Property is located in order to exercise
all remedies available to the Trust under
applicable law following default by
the related Mortgagor:
(i) The original recorded Mortgage with evidence of recordation
noted
thereon or attached thereto, together with any addenda or
riders
thereto,
or a copy of such recorded Mortgage with such evidence of
recordation certified to be true and correct by the appropriate
governmental recording office; or a copy of such recorded Mortgage
with
such
evidence of recordation, or if the original Mortgage has been
submitted
for recordation but has not been returned from the applicable
public
recording office, a copy of the Mortgage certified by an officer
of
Wells
Fargo Bank or the applicable Wells Fargo Bank Correspondent to be
a
true and
correct copy of the original Mortgage submitted for
recordation;
(ii) The original of each assumption agreement, modification,
written
assurance or substitution agreement pertaining to such
Mortgage,
if any,
or, if such document is in the process of being recorded, a
copy
of such
document, certified by an officer of Wells Fargo Bank or the
applicable
Wells Fargo Bank Correspondent of such Mortgage Loan or by the
applicable
title insurance company, closing agent, settlement agent,
escrow
agent or closing attorney to be a true and correct copy of such
document
transmitted for recordation, if any;
(iii) For each MERS Mortgage Loan that is not a MOM Mortgage
Loan,
the
original assignment showing MERS as the assignee of the Mortgage,
with
evidence
of recording thereon or copies thereof certified by an officer
of
Wells
Fargo Bank or the applicable Wells Fargo Bank Correspondent to
have
been
submitted for recordation;
(iv) Each original recorded intervening assignment of the
Mortgage
as may be
necessary to show a complete chain of title from the Mortgage
Loan
originator to Wells Fargo Bank or Wells Fargo Home Mortgage,
Inc.,
with
evidence of recordation noted thereon or attached thereto, or a
copy
of such
assignment with such evidence of recordation to be true and
correct by
the appropriate governmental recording office, or, if any such
assignment
has been submitted for recordation but has not been returned
from the
applicable public recording office or is not otherwise
available,
a copy of
such assignment certified by an officer of Wells Fargo Bank or
the applicable Wells Fargo
Bank Correspondent to be a true and correct
copy of
the recorded assignment submitted for recordation; and
(v) The original policy of the title insurance or certificate
of
title
insurance or a written commitment to issue such a title
insurance
policy or
certificate of title insurance, or a copy of such title
insurance
certified as true and correct by the applicable insurer or any
attorney's
certificate of title with an Officer's Certificate of Wells
Fargo Bank
or the applicable Wells Fargo Bank Correspondent that such
attorney's
certificate of title is customarily used in lieu of a title
insurance
policy in the jurisdiction in which the related mortgage
property
is located.
(c) If any assignment of a Mortgage to the Trustee is in the
process
of being recorded on the Closing Date, the
Depositor shall use its best efforts
to cause each such original recorded
document or certified copy thereof to be
delivered to the Custodian promptly
following its recordation, but in no event
later than one (1) year following the
Closing Date. If any Mortgage has been
recorded in the name of MERS or its
designee, no assignment of Mortgage in favor
of the Trustee will be required to be
prepared or delivered and instead, the
Master Servicer shall take all actions as
are necessary to cause the Trust Fund
to be shown as the owner of the related
Mortgage Loan on the records of MERS for
the purpose of the system of recording
transfers of beneficial ownership of
mortgages maintained by MERS. The Depositor
shall also cause to be delivered to
the Custodian any other original mortgage
loan document included in the Owner
Mortgage File (and, if applicable, the
Retained Mortgage File) if a copy thereof
has been delivered. The Depositor shall pay
from its own funds, without any
right of reimbursement therefor, the amount
of any costs, liabilities and
expenses incurred by the Trust by reason of
the failure of the Depositor to
cause to be delivered to the Custodian
within one (1) year following the Closing
Date any assignment of a Mortgage (except
with respect to any Mortgage recorded
in the name of MERS) not delivered to the
Custodian on the Closing Date.
In lieu of recording an assignment of any Mortgage the
Depositor
may, deliver or cause to be delivered to
the Custodian the assignment of the
Mortgage Loan to the Trustee in a form
suitable for recordation, if (i) with
respect to a particular state the Trustee
and the Custodian have received an
Opinion of Counsel acceptable to it that
such recording is not required to make
the assignment effective against the
parties to the Mortgage or subsequent
purchasers or encumbrancers of the
Mortgaged Property or (ii) the Depositor has
been advised by each Rating Agency that
non-recordation in a state will not
result in a reduction of the rating
assigned by that Rating Agency at the time
of initial issuance of the Certificates.
Set forth on Exhibit Q attached hereto
is a list of all states where recordation
is required by either Rating Agency to
obtain the initial ratings of the
Certificates. The Custodian may rely and shall
be protected in relying upon the
information contained in such Exhibit Q. In the
event that the Custodian receives notice
that recording is required to protect
the right, title and interest of the
Trustee in and to any such Mortgage Loan
for which recordation of an assignment has
not previously been required, the
Custodian shall promptly notify the Trustee
and the Custodian shall within five
Business Days (or such other reasonable
period of time mutually agreed upon by
the Custodian and the Trustee) of its
receipt of such notice deliver each
previously unrecorded assignment to the
related Servicer for recordation.
(d) Except
for Mortgage Notes endorsed in blank, endorsements shall
comply with the following format:
WITHOUT RECOURSE
PAY TO THE ORDER OF:
HSBC BANK USA, NATIONAL ASSOCIATION, AS
TRUSTEE under the pooling and servicing
agreement dated as of [June 29, 2005].
and its successors and assigns,
[Wells Fargo Bank, N.A.][Wells Fargo Home Mortgage, Inc.]
[Signature of Officer]
[Officer's Name and Title]
Except where assignments in blank are authorized or in the case
of
any Mortgage registered in the name of
MERS, assignments of any Mortgage shall
comply with the following:
HSBC BANK USA, NATIONAL ASSOCIATION, AS
TRUSTEE
and its successors and assigns
Section 2.02 Acceptance by Custodian.
The Custodian, on behalf of the Trustee, acknowledges the
receipt
of, subject to the provisions of Section
2.01 and subject to the review
described below and any exceptions noted on
the exception report described in
the next paragraph below, the documents
referred to in Section 2.01 above and
all other assets included in the definition
of "Trust Fund" and declares that it
holds and will hold such documents and the
other documents delivered to it
constituting the Owner Mortgage File (and
in the case of a Document Transfer
Event, the Retained Mortgage File), and
that it holds or will hold all such
assets and such other assets included in
the definition of "Trust Fund" in trust
for the exclusive use and benefit of all
present and future Certificateholders.
The Custodian, for the benefit of the Certificateholders, shall
execute and deliver to the Servicer, the
Securities Administrator, the Trustee
and the Depositor on or prior to the
Closing Date an initial certification in
the form attached hereto as Exhibit F-1
hereto, to the effect that, except as
may be specified in a list of exceptions
attached thereto, it has received the
original Mortgage Notes (described in
Section 2.01(a)(i)) relating to each
Mortgage Loan listed in the Mortgage Loan
Schedules (other than any Mortgage
Loan that has been paid in full, liquidated
or otherwise released as of the date
of such certification, and subject to any
exceptions specifically identified in
the exception report annexed to such
certification).
The Custodian will review each Owner Mortgage File within 45
days
after execution of this Agreement. The
Custodian will deliver no later than 30
days after completion of such review to the
Seller and the Trustee a final
certification in the form of Exhibit F-2
hereto to the effect that, except as
may be specified in a list of exceptions
attached thereto, all required
documents set forth in Section 2.01(a) have
been executed and received and
appear regular on their face, and that such
documents relate to the Mortgage
Loans identified in the Mortgage Loan
Schedule based on a comparison of the
Mortgage Loan identifying number, Mortgagor
name and street address, and in so
doing the Custodian may rely on the
purported due execution and genuineness of
any such document and on the purported
genuineness of any signature thereon.
If in the process of reviewing the Mortgage Files and making or
preparing, as the case may be, the
certifications referred to above, the
Custodian finds any document or documents
constituting a part of a Mortgage File
to be missing or defective in any material
respect, at the conclusion of its
review the Custodian shall so notify the
Depositor, the Trustee, the Securities
Administrator and the Servicer.
The Depositor and the Trustee intend that the assignment and
transfer herein contemplated constitute a
sale of the Mortgage Loans and the
Related Documents, conveying good title
thereto free and clear of any liens and
encumbrances, from the Depositor to the
Trustee and that such property not be
part of the Depositor's estate or property
of the Depositor in the event of any
insolvency by the Depositor. In the event
that such conveyance is deemed to be,
or to be made as security for, a loan, the
parties intend that the Depositor
shall be deemed to have granted and does
hereby grant to the Trustee, on behalf
of the Trust, a first priority perfected
security interest in all of the
Depositor's right, title and interest in
and to the Mortgage Loans and the
Related Documents, and that this Agreement
shall constitute a security agreement
under applicable law.
The Securities Administrator is hereby directed to execute and
deliver, on behalf of the Trust, the Yield
Maintenance Agreements.
Section 2.03 Repurchase or Substitution of Mortgage Loans by
the
Depositor.
(a) Upon discovery or receipt of written notice of any
materially
defective document in, or that a document
is missing from, an Owner Mortgage
File (or, if applicable, a Retained
Mortgage File) or of a breach of a
representation of warranty of the Depositor
in Section 2.04 hereof, in respect
of any Mortgage Loan and, except for a
breach of the representations and
warranties set forth in clause (ee) of
Section 2.04, such breach materially
adversely affects the value of such
Mortgage Loan, Prepayment Penalty or the
interest therein of the Certificateholders,
the Trustee (or the Custodian) shall
promptly notify the Depositor and the
Servicer of such defect, missing document
or breach and request that the Depositor
cure such defect or breach or deliver
such missing document within 60 days from
the date the Depositor was notified of
such missing document, breach or defect. If
the Depositor does not deliver such
missing document or cure such defect or
cure such breach in all material
respects during such period, the Depositor
shall repurchase such Mortgage Loan
from the Trust Fund at the Purchase Price
on or prior to the Determination Date
following the expiration of such period
(subject to Section 2.03(d)) and the
last paragraph of this Section 2.03(a). The
Purchase Price for the repurchased
Mortgage Loan shall be deposited in the
Collection Account, and the Custodian,
upon receipt of written notice from the
Servicer of such deposit, shall release
to the Depositor the related Owner Mortgage
File (and, if applicable, Retained
Mortgage File). The Trustee shall execute
and deliver such instrument of
transfer or assignment (or, in the case of
a Mortgage Loan registered in the
name of MERS or its designee, the Servicer
shall reflect such assignment on the
records of MERS), in each case without
recourse, and deliver such instruments of
transfer or assignment, in each case
without recourse, as the Depositor shall
furnish to it and as shall be necessary to
vest in the Depositor any Mortgage
Loan released pursuant hereto and the
Custodian and the Trustee shall have no
further responsibility with regard to such
Owner Mortgage File (and, if
applicable, Retained Mortgage File). In
lieu of repurchasing any such Mortgage
Loan as provided above, the Depositor may
cause such Mortgage Loan to be removed
from the Trust Fund (in which case it shall
become a Defective Mortgage Loan)
and substitute one or more Eligible
Substitute Mortgage Loans in the manner and
subject to the limitations set forth in
Section 2.03(d).
It is understood and agreed that the representations and
warranties
set forth in Section 2.04 hereof shall
survive delivery of the Owner Mortgage
Files (and, if applicable, Retained
Mortgage Files) to the Custodian and shall
inure to the benefit of the
Certificateholders notwithstanding any restrictive
or qualified endorsement or assignment. It
is understood and agreed that the
obligations of the Depositor set forth in
this Section 2.03(a) to cure,
substitute for or repurchase a Mortgage
Loan and to pay the Reimbursement Amount
constitute the sole remedies available to
the Certificateholders and to the
Trustee on their behalf respecting a breach
of the representations and
warranties in Section 2.04 hereof.
Notwithstanding anything to the contrary in this Section 2.03,
with
respect to any breach by the Depositor of
the representation and warranty set
forth in Section 2.04(z), which breach
materially and adversely affects the
value of any Prepayment Penalty or the
interest of the Trust therein, the
Depositor shall not be required to
repurchase such Mortgage Loans as set forth
in this Section 2.03(a). However, the
Originator shall remedy such breach as
follows: Upon any Principal Prepayment with
respect to the affected Mortgage
Loan, the Originator shall pay to the Trust
the excess, if any, of (x) the
amount of such Prepayment Penalty
calculated as set forth in the matrices
attached hereto as Exhibit R over (y) the
amount collected from the Mortgagor in
respect of such Prepayment Penalty. Such
amount payable by the Originator shall
be paid by the Servicer Remittance Date in
the month following the month in
which the related Principal Prepayment
occurred.
(b) In addition to the foregoing, in the case of a breach of
the
Depositor's representation set forth in
Section 2.04(i) and (dd) hereof, the
Depositor shall pay to the Trust the
Reimbursement Amount. The Reimbursement
Amount shall be delivered to the Servicer
for deposit into the Collection
Account within 10 days from the date the
Depositor was notified by the Trustee
of the amount of such costs and
damages.
(c) Within 90 days of the earlier of discovery by the Servicer
or
receipt of notice by the Servicer of the
breach of any representation, warranty
or covenant of the Servicer set forth in
Section 2.05 which materially and
adversely affects the interests of the
Certificateholders in any Mortgage Loan,
the Servicer shall cure such breach in all
material respects.
(d) Any substitution of Eligible Substitute Mortgage Loans for
Defective Mortgage Loans made pursuant to
Section 2.03(a) must be effected prior
to the last Business Day that is within two
years after the Closing Date. As to
any Defective Mortgage Loan for which the
Depositor substitutes an Eligible
Substitute Mortgage Loan or Loans, such
substitution shall be effected by the
Depositor delivering to the Custodian, on
the Trustee's behalf for such Eligible
Substitute Mortgage Loan or Loans, the
documents required by Section 2.01,
together with an Officers' Certificate
providing that each such Eligible
Substitute Mortgage Loan satisfies the
definition thereof and specifying the
Substitution Adjustment Amount (as
described below), if any, in connection with
such substitution. The Custodian shall
acknowledge receipt for such Eligible
Substitute Mortgage Loan or Loans and,
within ten Business Days thereafter, the
Custodian shall review such documents as
specified in Section 2.02 and deliver
to the Servicer and the Trustee, with
respect to such Eligible Substitute
Mortgage Loan or Loans, a certification
substantially in the form attached
hereto as Exhibit F-1, with any applicable
exceptions noted thereon. Within one
year of the date of substitution, the
Custodian shall deliver to the Servicer
and the Trustee a certification
substantially in the form of Exhibit F-2 hereto
with respect to such Eligible Substitute
Mortgage Loan or Loans, with any
applicable exceptions noted thereon.
Monthly Payments due with respect to
Eligible Substitute Mortgage Loans in the
month of substitution are not part of
the Trust Fund and will be retained by the
Depositor. For the month of
substitution, distributions to
Certificateholders will reflect the collections
and recoveries in respect of such Defective
Mortgage Loan in the Collection
Period or Prepayment Period, as applicable,
preceding the date of substitution
and the Depositor shall thereafter be
entitled to retain all amounts
subsequently received in respect of such
Defective Mortgage Loan. The Depositor
shall give or cause to be given written
notice to the Certificateholders that
such substitution has taken place, shall
amend the applicable Mortgage Loan
Schedule to reflect the removal of such
Defective Mortgage Loan from the terms
of this Agreement and the substitution of
the Eligible Substitute Mortgage Loan
or Loans and shall deliver a copy of such
amended Mortgage Loan Schedule to the
Trustee. Upon such substitution, such
Eligible Substitute Mortgage Loan or Loans
shall constitute part of the Mortgage Pool
and shall be subject in all respects
to the terms of this Agreement, including
all applicable representations and
warranties as of the date of
substitution.
For any month in which the Depositor substitutes one or more
Eligible Substitute Mortgage Loans for one
or more Defective Mortgage Loans,
including any substitution pursuant to
Section 2.08, the Servicer will determine
the amount (the "Substitution Adjustment
Amount"), if any, by which the
aggregate Purchase Price of all such
Defective Mortgage Loans (or Mortgage Loan,
in the case of a substitution pursuant to
Section 2.08) exceeds the aggregate,
as to each such Eligible Substitute
Mortgage Loan, of the principal balance
thereof as of the date of substitution,
together with one month's interest on
such principal balance at the applicable
Net Mortgage Interest Rate. On the date
of such substitution, the Depositor will
deliver or cause to be delivered to the
Servicer for deposit in the Collection
Account an amount equal to the
Substitution Adjustment Amount, if any, and
the Trustee, upon receipt of the
related Eligible Substitute Mortgage Loan
or Loans and notice by the Servicer of
such deposit, shall release to the
Depositor the related Owner Mortgage File
(and, if applicable, Retained Mortgage
File) and shall execute and deliver such
instruments of transfer or assignment, in
each case without recourse, as the
Depositor shall deliver to it and as shall
be necessary to vest therein any
Defective Mortgage Loan released pursuant
hereto.
In addition, the Depositor shall obtain at its own expense and
deliver to the Trustee an Opinion of
Counsel to the effect that such
substitution will not cause (a) any federal
tax to be imposed on the Trust Fund,
including without limitation, any federal
tax imposed on "prohibited
transactions" under Section 860F(a)(l) of
the Code or on "contributions after
the startup date" under Section 860G(d)(l)
of the Code, or (b) either REMIC to
fail to qualify as a REMIC at any time that
any Certificate is outstanding. If
such Opinion of Counsel can not be
delivered, then such substitution may only be
effected at such time as the required
Opinion of Counsel can be given.
(e) Upon discovery by the Depositor, the Seller, the Servicer,
the
Securities Administrator, the Custodian 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 within two
Business Days give written notice thereof
to the other parties. In connection
therewith, the Depositor shall repurchase
or, subject to the limitations set
forth in Section 2.03(d), substitute one or
more Eligible Substitute Mortgage
Loans for the affected Mortgage Loan within
60 days of the earlier of discovery
or receipt of such notice with respect to
such affected Mortgage Loan. In
addition, upon discovery that a Mortgage
Loan is defective in a manner that
would cause it to be a "defective
obligation" within the meaning of Treasury
Regulations relating to REMICs, the
Depositor shall cure the defect or make the
required purchase or substitution no later
than 60 days after the discovery of
the defect. Any such repurchase or
substitution shall be made in the same manner
as set forth in Section 2.03(a). 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.
Section 2.04 Representations and Warranties of the Depositor
with
respect to the Mortgage Loans.
The Depositor hereby represents and warrants to the Trustee for
the
benefit of the Certificateholders that as
of the Closing Date or as of such
other date specifically provided
herein:
(a) The information set forth in the Mortgage Loan Schedules
was
true and correct in all material respects,
including, without limitation, the
information regarding any Prepayment
Penalty, at the date or dates respecting
which such information was furnished as
specified in the Mortgage Loan
Schedules;
(b) Immediately prior to the transfer and assignment
contemplated
herein, the Depositor was the sole owner
and holder of the Mortgage Loan free
and clear of any and all liens, pledges,
charges or security interests of any
nature and has full right and authority to
sell and assign the same;
(c) All payments required to be made up to the Due Date for
such
Mortgage Loan immediately preceding the
Closing Date under the terms of the
related Mortgage Note have been made and no
Mortgage Loan had more than one
delinquency in the 12 months preceding the
applicable Cut-off Date;
(d) The Mortgage Note, the related Mortgage and other
agreements
executed in connection therewith are
genuine, and each is the legal, valid and
binding obligation of the maker thereof,
enforceable in accordance with its
terms, except as such enforcement may be
limited by bankruptcy, insolvency,
reorganization or other similar laws
affecting the enforcement of creditors'
rights generally and by general equity
principles (regardless of whether such
enforcement is considered in a proceeding
in equity or at law); and, to the best
of the Depositor's knowledge, all parties
to the Mortgage Note and the Mortgage
had legal capacity to execute the Mortgage
Note and the Mortgage and each
Mortgage Note and Mortgage has been duly
and properly executed by the Mortgagor;
(e) All taxes, governmental assessments, insurance premiums,
and
water, sewer and municipal charges, which
previously became due and owing have
been paid, or an escrow of funds has been
established, to the extent permitted
by law, in an amount sufficient to pay for
every such item which remains unpaid;
and neither the Servicer nor the Depositor
has advanced funds, or received any
advance of funds by a party other than the
Mortgagor, directly or indirectly for
the payment of any amount required by the
Mortgage, except for interest accruing
from the date of the Mortgage Note or date
of disbursement of the Mortgage Loan
proceeds, whichever is later, to the day
which precedes by thirty days the first
Due Date under the related Mortgage
Note;
(f) Neither the Depositor nor any prior holder of the Mortgage
or
the related Mortgage Note has modified the
Mortgage or the related Mortgage Note
in any material respect, satisfied,
canceled or subordinated the Mortgage in
whole or in part, released the Mortgaged
Property in whole or in part from the
lien of the Mortgage, or executed any
instrument of release, cancellation,
modification or satisfaction, except in
each case as is reflected in an
agreement delivered to the Trustee or the
Custodian pursuant to Section 2.01;
(g) No Mortgage Note or Mortgage is subject to any right of
rescission, set-off, counterclaim or
defense, including the defense of usury,
nor will the operation of any of the terms
of the Mortgage Note or Mortgage, or
the exercise of any right thereunder,
render the Mortgage Note or Mortgage
unenforceable, in whole or in part, or
subject it to any right of rescission,
set-off, counterclaim or defense, including
the defense of usury, and no such
right of rescission, set-off, counterclaim
or defense has been asserted with
respect thereto;
(h) The Mortgage is a valid, subsisting and enforceable first
lien
on the property therein described, and the
Mortgaged Property is free and clear
of all encumbrances and liens having
priority over the first lien of the
Mortgage except for liens for real estate
taxes and special assessments not yet
due and payable and liens or interests
arising under or as a result of any
federal, state or local law, regulation or
ordinance relating to hazardous
wastes or hazardous substances, and, if the
related Mortgaged Property is a
condominium unit, any lien for common
charges permitted by statute or homeowners
association fees; and any security
agreement, chattel mortgage or equivalent
document related to, and delivered to the
Trustee or to the Custodian with, any
Mortgage establishes in the Depositor a
valid and subsisting first lien on the
property described therein and the
Depositor has full right to sell and assign
the same to the Trustee;
(i) Each Mortgage Loan at the time it was originated complied in
all
material respects with applicable federal,
state and local laws including,
without limitation, truth-in-lending, real
estate settlement procedures,
consumer credit protection, equal credit
opportunity, predatory and abusive
lending laws and disclosure laws;
(j) Each Mortgaged Property is located in the United States and
consists of a one- to four-unit residential
property, which may include a
detached home, townhouse, condominium unit,
a unit in a planned unit development
or a manufacturing housing unit which
constitutes real property for purposes of
the applicable state law;
(k) Except for Mortgage Loans secured by residential long-term
leases, the Mortgaged Property consists of
a fee simple estate in real property;
all of the improvements which are included
for the purpose of determining the
appraised value of the Mortgaged Property
lie wholly within the boundaries and
building restriction lines of such property
and no improvements on adjoining
properties encroach upon the Mortgaged
Property (unless insured against under
the related title insurance policy); and to
the best of the Depositor's
knowledge, the Mortgaged Property and all
improvements thereon comply with all
requirements of any applicable zoning and
subdivision laws and ordinances;
(l) With respect to each Mortgage where a lost note affidavit
has
been delivered to the Custodian on the
Trustee's behalf in place of the related
Mortgage Note, the related Mortgage Note is
no longer in existence;
(m) The proceeds of the Mortgage Loans have been fully
disbursed,
there is no requirement for future advances
thereunder and any and all
requirements as to completion of any
on-site or off-site improvements and as to
disbursements of any escrow funds therefor
have been complied with (except for
escrow funds for exterior items which could
not be completed due to weather and
escrow funds for the completion of swimming
pools); and all costs, fees and
expenses incurred in making, closing or
recording the Mortgage Loan have been
paid, except recording fees with respect to
Mortgages not recorded as of the
Closing Date;
(n) The Mortgage Loan (except any Mortgage Loan secured by a
Mortgaged Property located in any
jurisdiction, as to which an opinion of
counsel of the type customarily rendered in
such jurisdiction in lieu of title
insurance is instead received) is covered
by an American Land Title Association
mortgagee title insurance policy or other
generally acceptable form of policy or
insurance acceptable to Fannie Mae or
Freddie Mac, issued by a title insurer
acceptable to Fannie Mae or Freddie Mac
insuring the originator, its successors
and assigns, as to the first priority lien
of the Mortgage in the original
principal amount of the Mortgage Loan and
subject only to (A) the lien of
current real property taxes and assessments
not yet due and payable, (B)
covenants, conditions and restrictions,
rights of way, easements and other
matters of public record as of the date of
recording of such Mortgage acceptable
to mortgage lending institutions in the
area in which the Mortgaged Property is
located or specifically referred to in the
appraisal performed in connection
with the origination of the related
Mortgage Loan, (C) liens created pursuant to
any federal, state or local law, regulation
or ordinance affording liens for the
costs of clean-up of hazardous substances
or hazardous wastes or for other
environmental protection purposes and (D)
such other matters to which like
properties are commonly subject which do
not individually, or in the aggregate,
materially interfere with the benefits of
the security intended to be provided
by the Mortgage; the Depositor is the sole
insured of such mortgagee title
insurance policy, the assignment to the
Trustee of the Depositor's interest in
such mortgagee title insurance policy does
not require any consent of or
notification to the insurer which has not
been obtained or made, such mortgagee
title insurance policy is in full force and
effect and will be in full force and
effect and inure to the benefit of the
Trustee, no claims have been made under
such mortgagee title insurance policy, and
no prior holder of the related
Mortgage, including the Depositor, has
done, by act or omission, anything which
would impair the coverage of such mortgagee
title insurance policy;
(o) To the best of the Depositor's knowledge, there is no
default,
breach, violation or event of acceleration
existing under the Mortgage or the
related Mortgage Note and no event which,
with the passage of time or with
notice and the expiration of any grace or
cure period, would constitute a
default, breach, violation or event of
acceleration; the Depositor has not
waived any default, breach, violation or
event of acceleration; and no
foreclosure action is currently threatened
or has been commenced with respect to
the Mortgage Loan;
(p) The Mortgaged Property is free and clear of all mechanics'
and
materialmen's liens or liens in the nature
thereof; provided, however, that this
warranty shall be deemed not to have been
made at the time of the initial
issuance of the Certificates if a title
policy affording, in substance, the same
protection afforded by this warranty is
furnished to the Trustee by the
Depositor;
(q) The Mortgage Loan meets, or is exempt from, applicable state
or
federal laws, regulations and other
requirements, pertaining to usury, and the
Mortgage Loan is not usurious;
(r) To the best of the Depositor's knowledge, all inspections,
licenses and certificates required to be
made or issued with respect to all
portions of the Mortgaged Property and,
with respect to the use and occupancy of
the same, including, but not limited to,
certificates of occupancy and fire
underwriting certificates, have been made
or obtained from the appropriate
authorities;
(s) Each Mortgage Note (other than with respect to any Balloon
Loans) is payable in monthly payments,
resulting in complete amortization of the
Mortgage Loan over a term of not more than
360 months;
(t) Each Mortgage contains customary and enforceable provisions
such
as to render the rights and remedies of the
holder thereof adequate for the
realization against the Mortgaged Property
of the benefits of the security,
including realization by judicial
foreclosure (subject to any limitation arising
from any bankruptcy, insolvency or other
law for the relief of debtors), and
there is no homestead or other exemption
available to the Mortgagor which would
interfere with such right of
foreclosure;
(u) The Mortgaged Property is undamaged by water, fire,
earthquake,
earth movement other than earthquake,
windstorm, flood, tornado or similar
casualty (excluding casualty from the
presence of hazardous wastes or hazardous
substances, as to which the Depositor makes
no representations), so as to affect
adversely the value of the Mortgaged
Property as security for the Mortgage Loan
or the use for which the premises were
intended and to the best of the
Depositor's knowledge, there is no
proceeding pending or threatened for the
total or partial condemnation of the
Mortgaged Property;
(v) The Mortgaged Property securing each Mortgage Loan is insured
by
an insurer acceptable to Fannie Mae or
Freddie Mac against loss by fire and such
hazards as are covered under a standard
extended coverage endorsement, in an
amount which is not less than the lesser of
100% of the insurable value of the
Mortgaged Property and the outstanding
principal balance of the Mortgage Loan,
but in no event less than the minimum
amount necessary to fully compensate for
any damage or loss on a replacement cost
basis; if the Mortgaged Property is a
condominium unit, it is included under the
coverage afforded by a blanket policy
for the project; if upon origination of the
Mortgage Loan, the improvements on
the Mortgaged Property were in an area
identified in the Federal Register by the
Federal Emergency Management Agency as
having special flood hazards, a flood
insurance policy meeting the requirements
of the current guidelines of the
Federal Insurance Administration is in
effect with a generally acceptable
insurance carrier, in an amount
representing coverage not less than the least of
(A) the outstanding principal balance of
the Mortgage Loan, (B) the full
insurable value of the Mortgaged Property
and (C) the maximum amount of
insurance which was available under the
National Flood Insurance Act of 1968, as
amended; and each Mortgage obligates the
Mortgagor thereunder to maintain all
such insurance at the Mortgagor's cost and
expense;
(w) To the best of the Depositor's knowledge, no Mortgagor is a
debtor in any state or federal bankruptcy
or insolvency proceeding;
(x) If the Mortgage Loan is secured by a long-term residential
lease, (1) the lessor under the lease holds
a fee simple interest in the land;
(2) the terms of such lease expressly
permit the mortgaging of the leasehold
estate, the assignment of the lease without
the lessor's consent and the
acquisition by the holder of the Mortgage
of the rights of the lessee upon
foreclosure or assignment in lieu of
foreclosure or provide the holder of the
Mortgage with substantially similar
protections; (3) the terms of such lease do
not (a) allow the termination thereof upon
the lessee's default without the
holder of the Mortgage being entitled to
receive written notice of, and
opportunity to cure, such default, (b)
allow the termination of the lease in the
event of damage or destruction as long as
the Mortgage is in existence, (c)
prohibit the holder of the Mortgage from
being insured (or receiving proceeds of
insurance) under the hazard insurance
policy or policies relating to the
Mortgaged Property or (d) permit any
increase in rent other than pre-established
increases set forth in the lease; (4) the
original term of such lease is not
less than 15 years; (5) the term of such
lease does not terminate earlier than
five years after the maturity date of the
Mortgage Note; and (6) the Mortgaged
Property is located in a jurisdiction in
which the use of leasehold estates in
transferring ownership in residential
properties is a widely accepted practice;
(y) None of the Mortgage Loans are classified as "high cost"
Mortgage Loans under Section 32 of the Home
Ownership and Equity Protection Act
of 1994 as amended or any comparable state
law;
(z) With respect to each Mortgage Loan that has a Prepayment
Penalty, each such Prepayment Penalty shall
be enforceable, and each Prepayment
Penalty shall be permitted pursuant to
federal, state and local law. Each such
Prepayment Penalty is in an amount less
than or equal to the maximum amount
permitted under applicable law. Each such
Prepayment Penalty actually charged to
the related borrower is in accordance with
the Prepayment Penalty matrices set
forth in Exhibit R;
(aa) Each Mortgage Loan is a "qualified mortgage" within the
meaning
of Section 860G of the Code and Treas. Reg.
ss.1.860G-2;
(bb) No Mortgage Loan is a "high cost" loan as defined under
any
federal, state or local law applicable to
such Mortgage Loan at the time of its
origination;
(cc) No Mortgage Loan is serviced by the Trustee or an affiliate
of
the Trustee;
(dd) No Mortgage Loan (other than a Mortgage Loan that is a New
Jersey covered purchase loan) is a High
Cost Loan or Covered Loan, as applicable
(as such terms are defined in S&P's
LEVELS(R) Glossary Version 5.6b, Appendix
E), no Mortgage Loan originated on or after
October 1, 2002 through March 6,
2003 is governed by the Georgia Fair
Lending Act and no Mortgage Loan originated
on or after March 7, 2003 is a "high cost
home loan" as defined under the
Georgia Fair Lending Act; and
(ee) In addition to the foregoing representations and
warranties
made in subparagraphs (a) through (dd)
above, the Depositor further represents
and warrants upon delivery of the Group I
Mortgage Loans, as to each, that:
(i) No mortgage loan is covered by the Home Ownership and
Equity
Protection
Act of 1994;
(ii) With respect to each Group I Mortgage Loan, none of the
proceeds
of such Mortgage Loan were used to finance single-premium
credit
life
insurance policies;
(iii) With respect to each Group I Mortgage Loan, the Servicer
has
furnished
accurate and complete information on the related borrower
credit
files to
Equifax, Experian and Trans Union Credit Information Company,
in
accordance
with the Fair Credit Reporting Act and its implementing
regulations;
(iv) The unpaid principal balance of each Group I Mortgage Loan
does
not exceed
the applicable maximum original loan amount limitations with
respect to
first lien one- to four-family residential mortgage loans as
set forth
in the Freddie Mac Selling Guide;
(v) With respect to each Group I Mortgage Loan that has a
Prepayment
Penalty,
no such Prepayment Penalty may be imposed for a term in excess
of
five (5)
years with respect to Mortgage Loans originated prior to
October
1, 2002
and three (3) years with respect to Mortgage Loans originated
on
or after
October 1, 2002;
(vi) No Group I Mortgage Loan is a "high-cost," "high-cost
home,"
"covered"
(excluding home loans defined as "covered home loans" pursuant
to clause
(1) of the definition of that term in the New Jersey Home
Ownership
Security Act of 2002), "high-risk home" or "predatory" loan
under any
applicable federal, state or local predatory or abusive lending
law;
and
(vii) With respect to any Group I Mortgage Loan originated on
or
after
August 1, 2004, neither the related Mortgage nor the related
Mortgage
Note requires the borrower to submit to arbitration to resolve
any
dispute arising out of or relating in any way to the mortgage
loan
transaction.
Notwithstanding the foregoing, no representations or warranties
are
made by the Depositor as to the
environmental condition of any Mortgaged
Property; the absence, presence or effect
of hazardous wastes or hazardous
substances on any Mortgaged Property; any
casualty resulting from the presence
or effect of hazardous wastes or hazardous
substances on, near or emanating from
any Mortgaged Property; the impact on
Certificateholders of any environmental
condition or presence of any hazardous
substance on or near any Mortgaged
Property; or the compliance of any
Mortgaged Property with any environmental
laws, nor is any agent, person or entity
otherwise affiliated with the Depositor
authorized or able to make any such
representation, warranty or assumption of
liability relative to any Mortgaged
Property. In addition, no representations or
warranties are made by the Depositor with
respect to the absence or effect of
fraud in the origination of any Mortgage
Loan.
It is understood and agreed that the representations and
warranties
set forth in this Section 2.04 shall
survive delivery of the respective Owner
Mortgage Files (and, if applicable,
Retained Mortgage Files) to the Custodian
and shall inure to the benefit of the
Trustee notwithstanding any restrictive or
qualified endorsement or assignment.
Section 2.05 Representations, Warranties and Covenants of the
Servicer.
The Servicer hereby represents, warrants and covenants to the
Trustee, for the benefit of each of the
Trustee and the Certificateholders and
to the Depositor and the Securities
Administrator that as of the Closing Date or
as of such date specifically provided
herein:
(i) The Servicer is a national banking association duly
chartered
and
validly existing in good standing under the laws of the United
States
and has
all licenses necessary to carry on its business as now being
conducted,
except for such licenses, certificates and permits the absence
of which,
individually or in the aggregate, would not have a material
adverse
effect on the ability of the Servicer to conduct its business
as
it is
presently conducted, and is licensed, qualified and in good
standing
in the
states where the Mortgaged Property is located if the laws of
such
state
require licensing or qualification in order to conduct business
of
the type conducted by the
Servicer or to ensure the enforceability or
validity
of each Mortgage Loan; the Servicer has the power and authority
to execute
and deliver this Agreement and to perform in accordance
herewith;
the execution, delivery and performance of this Agreement
(including
all instruments of transfer to be delivered pursuant to this
Agreement)
by the Servicer and the consummation of the transactions
contemplated hereby have been duly and validly authorized; and
all
requisite
corporate action has been taken by the Servicer to make this
Agreement
valid and binding upon the Servicer in accordance with its
terms;
(ii) The consummation of the transactions contemplated by this
Agreement are in the
ordinary course of business of the Servicer and will
not result
in the breach of any term or provision of the articles of
incorporation or by-laws of the Servicer or result in the breach of
any
term or
provision of, or conflict with or constitute a default under or
result in
the acceleration of any obligation under, any agreement,
indenture
or loan or credit agreement or other instrument to which the
Servicer
or its property is subject, or result in the violation of any
law, rule,
regulation, order, judgment or decree to which the Servicer or
its
property is subject;
(iii) The Servicer is an approved seller/servicer of
conventional
residential mortgage loans for Fannie Mae or Freddie Mac, with
the
facilities, procedures, and experienced personnel necessary for the
sound
servicing
of mortgage loans of the same type as the Mortgage Loans. The
Servicer
is a HUD approved mortgagee pursuant to Section 203 of the
National
Housing Act and is in good standing to sell mortgage loans to
and
service
mortgage loans for Fannie Mae or Freddie Mac, and no event has
occurred,
including but not limited to a change in insurance coverage,
which
would make the Servicer unable to comply with Fannie Mae or
Freddie
Mac
eligibility requirements or which would require notification to
either
Fannie Mae
or Freddie Mac;
(iv) This Agreement, and all documents and instruments
contemplated
hereby
which are executed and delivered by the Servicer, constitute
and
will
constitute valid, legal and binding obligations of the
Servicer,
enforceable in accordance with their respective terms, except as
the
enforcement thereof may be limited by applicable bankruptcy,
insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement
of
creditors' rights generally (whether considered in a proceeding at
law
or in
equity);
(v) The Servicer does not believe, nor does it have any reason
or
cause to
believe, that it cannot perform each and every covenant
contained
in this
Agreement;
(vi) There is no action, suit, proceeding or investigation
pending
or, to its
knowledge, threatened against the Servicer that, either
individually or in the aggregate, may result in any material
adverse
change in
the business, operations, financial condition, properties or
assets of
the Servicer, or in any material impairment of the right or
ability of
the Servicer to carry on its business substantially as now
conducted,
or in any material liability on the part of the Servicer, or
that would
draw into question the validity or enforceability of this
Agreement
or of any action taken or to be taken in connection with the
obligations of the Servicer contemplated herein, or that would be
likely
to impair
materially the ability of the Servicer to perform under the
terms of
this Agreement;
(vii) No consent, approval 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 by this Agreement, except
for such
consents, approvals, authorizations and orders, if any, that
have
been
obtained; and
(viii) No information in this Agreement provided by the Servicer
nor
any
information, certificate of an officer, statement furnished in
writing
or report
delivered to the Trustee or the Securities Administrator by the
Servicer
in connection with the transactions contemplated hereby
contains
or will
contain any untrue statement of a material fact or omits or
will
omit to
state a material fact necessary in order to make the statements
contained
therein, in light of the circumstances under which they were
made, not
misleading.
(ix) The Servicer has fully furnished, and shall continue to
fully
furnish
for so long as it is servicing the Mortgage Loans hereunder, in
accordance
with the Fair Credit Reporting Act and its implementing
regulations, accurate and complete information on the Mortgagor
credit
files to
Equifax, Experian and Trans Union Credit Information Company on
a
monthly
basis.
It is understood and agreed that the representations, warranties
and
covenants set forth in this Section 2.05
shall survive delivery of the Mortgage
Files to the Custodian and shall inure to
the benefit of the Trustee, the
Depositor, the Securities Administrator and
the Certificateholders. Upon
discovery by any of the Depositor, the
Servicer, the Securities Administrator or
the Trustee of a breach of any of the
foregoing representations, warranties and
covenants which materially and adversely
affects the value of any Mortgage Loan,
Prepayment Penalty or the interests therein
of the Certificateholders, the party
discovering such breach shall give prompt
written notice (but in no event later
than two Business Days following such
discovery) to the other parties hereto.
Section 2.06 Representations and Warranties of the Depositor.
The
Depositor represents and warrants to the Trust and the Trustee
on behalf of the Certificateholders and to
the Servicer and Securities
Administrator as follows:
(i) This agreement constitutes a legal, valid and binding
obligation
of the Depositor, enforceable
against the Depositor in accordance with its
terms,
except as enforceability may be limited by applicable
bankruptcy,
insolvency, reorganization, moratorium or other similar laws now
or
hereafter
in effect affecting the enforcement of creditors' rights in
general
and except as such enforceability may be limited by general
principles
of equity (whether considered in a proceeding at law or in
equity);
(ii) Immediately prior to the sale and assignment by the
Depositor
to the
Trustee on behalf of the Trust of each Mortgage Loan, the
Depositor
had good
and marketable title to each Mortgage Loan (insofar as such
title
was
conveyed to it by the Seller) subject to no prior lien, claim,
participation interest, mortgage, security interest, pledge, charge
or
other
encumbrance or other interest of any nature;
(iii) As of the Closing Date, the Depositor has transferred all
right,
title interest in the Mortgage Loans to the Trustee on behalf
of
the
Trust;
(iv) The Depositor has not transferred the Mortgage Loans to
the
Trustee on
behalf of the Trust with any intent to hinder, delay or defraud
any of its
creditors;
(v) The Depositor has been duly incorporated and is validly
existing
as a
corporation in good standing under the laws of the State of
Delaware,
with full
corporate power and authority to own its assets and conduct its
business
as presently being conducted;
(vi) The Depositor is not in violation of its certificate of
incorporation or by-laws or in default in the performance or
observance of
any
material obligation, agreement, covenant or condition contained in
any
contract,
indenture, mortgage, loan agreement, note, lease or other
instrument
to which the Depositor is a party or by which it or its
properties
may be bound, which default might result in any material
adverse
changes in the financial condition, earnings, affairs or
business
of the
Depositor or which might materially and adversely affect the
properties
or assets, taken as a whole, of the Depositor;
(vii) The execution, delivery and performance of this Agreement
by
the
Depositor, and the consummation of the transactions
contemplated
thereby,
do not and will not result in a material breach or violation of
any of the
terms or provisions of, or, to the knowledge of the Depositor,
constitute a default under, any
indenture, mortgage, deed of trust, loan
agreement
or other agreement or instrument to which the Depositor is a
party or
by which the Depositor is bound or to which any of the property
or assets
of the Depositor is subject, nor will such actions result in
any
violation
of the provisions of the certificate of incorporation or
by-laws
of the
Depositor or, to the best of the Depositor's knowledge without
independent investigation, any statute or any order, rule or
regulation of
any court
or governmental agency or body having jurisdiction over the
Depositor
or any of its properties or assets (except for such conflicts,
breaches,
violations and defaults as would not have a material adverse
effect on
the ability of the Depositor to perform its obligations under
this
Agreement);
(viii) To the best of the Depositor's knowledge without any
independent investigation, no consent, approval, authorization,
order,
registration or qualification of or with any court or governmental
agency
or body of
the United States or any other jurisdiction is required for the
issuance
of the Certificates, or the consummation by the Depositor of
the
other
transactions contemplated by this Agreement, except such
consents,
approvals,
authorizations, registrations or qualifications as (a) may be
required
under State securities or blue sky laws, (b) have been
previously
obtained
or (c) the failure of which to obtain would not have a material
adverse
effect on the performance by the Depositor of its obligations
under, or
the validity or enforceability of, this Agreement; and
(ix) There are no actions, proceedings or investigations
pending
before or,
to the Depositor's knowledge, threatened by any court,
administrative agency or other tribunal to which the Depositor is a
party
or of
which any of its properties is the subject: (a) which if
determined
adversely
to the Depositor would have a material adverse effect on the
business,
results of operations or financial condition of the Depositor;
(b)
asserting the invalidity of this Agreement or the Certificates;
(c)
seeking to
prevent the issuance of the Certificates or the consummation by
the
Depositor of any of the transactions contemplated by this
Agreement,
as the
case may be; or (d) which might materially and adversely affect
the
performance by the Depositor of its obligations under, or the
validity or
enforceability of, this Agreement.
Section 2.07 Issuance of Certificates and the Uncertificated
Regular
Interests.
The Trustee acknowledges the assignment to it of the Mortgage
Loans
and the delivery to the Custodian on its
behalf of the Mortgage Files, subject
to the provisions of Sections 2.01 and
2.02, and the Trustee acknowledges the
assignment to it of all other assets
included in the Trust Fund, receipt of
which is hereby acknowledged. Concurrently
with such assignment and delivery and
in exchange therefor, the Securities
Administrator, pursuant to the Written
Order to Authenticate executed by an
officer of the Depositor, has executed, and
the Certificate Registrar has authenticated
and delivered to or upon the order
of the Depositor, the Class A Certificates
and Class M Certificates (other than
the Class M-12, Class M-13 and Class M-14
Certificates) in minimum dollar
denominations of $25,000 and integral
dollar multiples of $1 in excess thereof
and the Class M-12, Class M-13 and Class
M-14 Certificates in minimum
denominations of $250,000 and integral
multiples of $1 in excess thereof. The
Class CE and Class P Certificates are
issuable only in minimum Percentage
Interests of 10%. The Class R Certificate
is issuable only as a single
certificate. The Trustee acknowledges the
issuance of the uncertificated REMIC 1
Regular Interests and declares that it hold
such regular interests as assets of
REMIC 2. The Trustee acknowledges the
obligation of the Class CE Certificates to
pay Cap Carryover Amounts, and declares
that it hold the same as assets of the
Grantor Trust on behalf of the Holders of
the Class AI-1A, Class AI-B, Class
AII, Class M-1, Class M-2, Class M-3, Class
M-4, Class M-5, Class M-6, Class
M-7, Class M-8, Class M-9, Class M-10,
Class M-11, Class M-12, Class M-13 and
Class M-14 Certificates, respectively. In
addition to the assets described in
the preceding sentence, the assets of the
Grantor Trust shall also include (i)
Prepayment Penalties, any Servicer
Prepayment Penalty Payment Amounts, any
Originator Prepayment Penalty Payment
Amounts and the beneficial interest of the
Class P Certificates with respect thereto
and (ii) the Yield Maintenance
Agreements, the Reserve Accounts and the
beneficial interest of the Class CE
Certificates with respect thereto, subject
to the obligation to pay Cap
Carryover Amounts. The interests evidenced
by the Certificates constitute the
entire beneficial ownership interest in the
Trust Fund.
&
