<PAGE>
EXHIBIT 4.1
EXECUTION COPY
MERRILL LYNCH MORTGAGE INVESTORS, INC.,
Depositor
WELLS FARGO BANK, N.A.,
Master Servicer and Securities Administrator
WILSHIRE CREDIT CORPORATION,
Servicer
PHH MORTGAGE CORPORATION,
Servicer
and
DEUTSCHE BANK NATIONAL TRUST COMPANY,
Trustee
--------------------------------------
POOLING AND SERVICING AGREEMENT
Dated as of June 1, 2005
--------------------------------------
MERRILL LYNCH MORTGAGE INVESTORS TRUST,
MORTGAGE LOAN ASSET-BACKED CERTIFICATES, SERIES 2005-SL2
<PAGE>
TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS................................................................................1
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND
WARRANTIES..............................38
SECTION 2.01.
Conveyance of Mortgage
Loans................................................38
SECTION 2.02.
Acceptance by the Trustee of the Mortgage
Loans.............................41
SECTION 2.03.
Representations, Warranties and Covenants of the
Depositor..................42
SECTION 2.04.
Representations and Warranties of the Master Servicer;
Representations and Warranties of the Servicers; Representations
and
Warranties of the Securities
Administrator..................................46
SECTION 2.05.
Substitutions and Repurchases of Mortgage Loans which are not
"Qualified
Mortgages".......................................................50
SECTION 2.06.
Authentication and
Delivery of Certificates.................................51
SECTION 2.07.
REMIC
Elections.............................................................51
SECTION 2.08.
[RESERVED]..................................................................54
SECTION 2.09.
Covenants of the
Servicers..................................................54
SECTION 2.10.
[RESERVED]..................................................................54
SECTION 2.11.
Permitted Activities of the
Trust...........................................54
SECTION 2.12.
Qualifying Special Purpose
Entity...........................................54
ARTICLE III
ADMINISTRATION AND SERVICING OF MORTGAGE
LOANS............................................54
SECTION 3.01.
Servicers to Service Mortgage
Loans.........................................54
SECTION 3.02.
Servicing and Subservicing; Enforcement of the Obligations of
Servicers...................................................................56
SECTION 3.03.
Rights of the Depositor and the Trustee in Respect of the
Servicers.........57
SECTION 3.04.
Master Servicer to Act as
Servicer..........................................57
SECTION 3.05.
Collection of Mortgage Loan Payments; Collection Account;
Certificate
Account.....................................................................58
SECTION 3.06.
Collection of Taxes, Assessments and Similar Items; Escrow
Accounts.........61
SECTION 3.07.
Access to Certain Documentation and Information Regarding the
Mortgage
Loans..............................................................61
SECTION 3.08.
Permitted Withdrawals from the Collection Account and
Certificate
Account.....................................................................62
SECTION 3.09.
[RESERVED]..................................................................64
SECTION 3.10.
[RESERVED]..................................................................64
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TABLE OF CONTENTS
(continued)
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SECTION 3.11.
Enforcement of Due-On-Sale Clauses; Assumption
Agreements...................64
SECTION 3.12.
Realization Upon Defaulted Mortgage Loans; Determination of
Excess
Proceeds; Special Loss
Mitigation...........................................65
SECTION 3.13.
Trustee and Custodian to Cooperate; Release of Mortgage
Files...............68
SECTION 3.14.
Documents, Records and Funds in Possession of Servicers to be
Held
for the
Trustee.............................................................69
SECTION 3.15.
Servicing
Compensation......................................................69
SECTION 3.16.
Access to Certain
Documentation.............................................70
SECTION 3.17.
Annual Statement as to
Compliance...........................................70
SECTION 3.18.
Annual Independent Public Accountants' Servicing Statement;
Financial
Statements..................................................................70
SECTION 3.19.
[RESERVED]..................................................................70
SECTION 3.20.
[RESERVED]..................................................................70
SECTION 3.21.
Annual Certificate by Securities
Administrator..............................70
SECTION 3.22.
Annual Certificate by
Servicers.............................................71
SECTION 3.23.
Prepayment Charge Reporting
Requirements....................................72
SECTION 3.24.
Information to the Securities
Administrator.................................72
SECTION 3.25.
Indemnification.............................................................72
SECTION 3.26.
Nonsolicitation.............................................................74
SECTION 3.27.
High Cost Mortgage
Loans....................................................74
ARTICLE IV
DISTRIBUTIONS.............................................................................74
SECTION 4.01.
Advances....................................................................74
SECTION 4.02.
Reduction of Servicing Compensation in Connection with
Prepayment
Interest
Shortfalls.........................................................75
SECTION 4.03.
Distributions on
the REMIC Interests........................................76
SECTION 4.04.
Distributions...............................................................76
SECTION 4.05.
Monthly Statements to
Certificateholders....................................79
ARTICLE V
THE
CERTIFICATES..........................................................................82
SECTION 5.01.
The
Certificates............................................................82
SECTION 5.02.
Certificate Register; Registration of Transfer and Exchange of
Certificates................................................................84
SECTION 5.03.
Mutilated, Destroyed, Lost or Stolen
Certificates...........................91
SECTION 5.04.
Persons Deemed
Owners.......................................................91
SECTION 5.05.
Access to
List of Certificateholders' Names and
Addresses...................91
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SECTION 5.06.
Book-Entry
Certificates.....................................................92
SECTION 5.07.
Notices to
Depository.......................................................93
SECTION 5.08.
Definitive
Certificates.....................................................93
SECTION 5.09.
Maintenance of Office or
Agency.............................................94
SECTION 5.10.
Authenticating
Agents.......................................................94
ARTICLE VI
THE DEPOSITOR, THE MASTER SERVICER, THE SERVICERS AND THE
SECURITIES ADMINISTRATOR........95
SECTION 6.01.
Respective Liabilities of the Depositor, the Master Servicer,
the
Servicers and the Securities
Administrator..................................95
SECTION 6.02.
Merger or Consolidation of the Depositor, the Master Servicer,
the
Servicers or the Securities
Administrator...................................95
SECTION 6.03.
Limitation on Liability of the Depositor, the Securities
Administrator, the Master Servicer, the Servicers and
Others................95
SECTION 6.04.
Limitation on Resignation of
Servicers......................................96
SECTION 6.05.
Errors and Omissions Insurance; Fidelity
Bonds..............................96
SECTION 6.06.
Limitation on Resignation of the Master
Servicer............................97
SECTION 6.07.
Assignment of Master
Servicing..............................................97
ARTICLE VII
DEFAULT; TERMINATION OF
SERVICER..........................................................97
SECTION 7.01.
Events of
Default...........................................................97
SECTION 7.02.
Master Servicer to Act; Appointment of
Successor............................99
SECTION 7.03.
Notification to
Certificateholders.........................................100
ARTICLE VIII
CONCERNING THE
TRUSTEE...................................................................100
SECTION 8.01.
Duties of the Trustee and the Securities
Administrator.....................100
SECTION 8.02.
Certain Matters Affecting the Trustee and the Securities
Administrator.....101
SECTION 8.03.
Trustee and Securities Administrator Not Liable for Certificates
or
Mortgage
Loans.............................................................103
SECTION 8.04.
Trustee and Securities Administrator May Own
Certificates..................103
SECTION 8.05.
Trustee's Fees and
Expenses................................................103
SECTION 8.06.
Indemnification and Expenses of
Trustee....................................104
SECTION 8.07.
Eligibility Requirements for
Trustee.......................................104
SECTION 8.08.
Resignation and Removal of
Trustee.........................................105
SECTION 8.09.
Successor
Trustee..........................................................105
SECTION 8.10.
Merger or Consolidation of
Trustee.........................................106
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(continued)
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SECTION 8.11.
Appointment of Co-Trustee or Separate
Trustee..............................106
SECTION 8.12.
Tax
Matters................................................................107
ARTICLE IX
TERMINATION..............................................................................109
SECTION 9.01.
Termination upon Liquidation or Repurchase of all Mortgage
Loans...........109
SECTION 9.02.
Final Distribution on the
Certificates.....................................110
SECTION 9.03.
Additional Termination
Requirements........................................111
ARTICLE X
MISCELLANEOUS
PROVISIONS.................................................................112
SECTION 10.01.
Amendment..................................................................112
SECTION 10.02.
Counterparts...............................................................114
SECTION 10.03.
Governing
Law..............................................................114
SECTION 10.04.
Intention of
Parties.......................................................114
SECTION 10.05.
Notices....................................................................115
SECTION 10.06.
Severability of
Provisions.................................................116
SECTION 10.07.
Assignment.................................................................116
SECTION 10.08.
Limitation on Rights of
Certificateholders.................................117
SECTION 10.09.
Inspection and Audit
Rights................................................117
SECTION 10.10.
Certificates Nonassessable and Fully
Paid..................................118
ARTICLE XI
ADMINISTRATION AND MASTER SERVICING OF THE MORTGAGE
LOANS................................118
SECTION 11.01.
Master
Servicer............................................................118
SECTION 11.02.
Monitoring of
Servicer.....................................................119
SECTION 11.03.
Fidelity
Bond..............................................................120
SECTION 11.04.
Power to Act;
Procedures...................................................120
SECTION 11.05.
Documents, Records and Funds in Possession of Master Servicer To
Be
Held for
Trustee...........................................................121
SECTION 11.06.
Trustee to Retain Possession of Certain Insurance Policies and
Documents..................................................................121
SECTION 11.07.
Compensation for the Master Servicer and the Securities
Administrator......122
SECTION 11.08.
Annual Statement as to
Compliance..........................................122
SECTION 11.09.
Periodic
Filings...........................................................122
SECTION 11.10.
Obligation of the Master Servicer in Respect of Prepayment
Interest
Shortfalls.................................................................123
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TABLE OF CONTENTS
(continued)
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PAGE
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EXHIBIT A
FORMS OF CERTIFICATES
A-1
EXHIBIT B
MORTGAGE LOAN SCHEDULE
B-1
EXHIBIT C
[RESERVED]
C-1
EXHIBIT D
FORM OF CUSTODIAN CERTIFICATION
D-1
EXHIBIT E-1
FORM OF CLASS R TRANSFEREE'S LETTER AND AFFIDAVIT
E-1-1
EXHIBIT E-2
FORM OF CLASS R TRANSFEROR'S AFFIDAVIT
E-1-2
EXHIBIT F
FORM OF TRANSFEROR CERTIFICATE
F-1
EXHIBIT G
FORM OF INVESTMENT LETTER
G-1
EXHIBIT H
FORM OF RULE 144A LETTER
H-1
EXHIBIT I
FORM OF REQUEST FOR RELEASE
I-1
EXHIBIT J-1
MLMC LIST OF TRANSFER AGREEMENTS AND BRING DOWN
LETTERS
J-1-1
EXHIBIT J-2
MLML LIST OF TRANSFER AGREEMENTS AND BRING DOWN
LETTERS
J-2-1
EXHIBIT K
FORM OF OFFICER'S CERTIFICATE OF TRUSTEE
K-1
EXHIBIT L
FORM OF OFFICER'S CERTIFICATE OF SERVICER
L-1
EXHIBIT M-1
FORM OF DELINQUENCY REPORT
M-1-1
EXHIBIT M-2
FORM OF MONTHLY REMITTANCE ADVICE
M-2-1
EXHIBIT M-3
FORM OF REALIZED LOSS REPORT
M-3-1
EXHIBIT N
FORM OF TRANSFEROR REPRESENTATION LETTER
FOR
TRANSFER TO REGULATION S BOOK-ENTRY CERTIFICATE
FROM A HOLDER OF A RULE 144A BOOK-ENTRY CERTIFICATE OR
DEFINITIVE CERTIFICATE
N-1
EXHIBIT O
FORM OF TRANSFEROR REPRESENTATION LETTER
FOR TRANSFER PURSUANT TO RULE 144A FROM A HOLDER OF
A REGULATION S BOOK-ENTRY CERTIFICATE OR DEFINITIVE
CERTIFICATE
O-1
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POOLING AND SERVICING AGREEMENT, dated as of June 1, 2005,
among
MERRILL LYNCH MORTGAGE INVESTORS, INC., a
Delaware corporation, as depositor
(the "Depositor"), WELLS FARGO BANK, N.A, a
national banking association, as
master servicer (the "Master Servicer") and
securities administrator (the
"Securities Administrator"), WILSHIRE
CREDIT CORPORATION, a Nevada corporation,
as servicer ("Wilshire" or a "Servicer"),
PHH MORTGAGE CORPORATION, a New Jersey
corporation, as servicer ("PHH" or a
"Servicer," and together with Wilshire, the
"Servicers") and DEUTSCHE BANK NATIONAL
TRUST COMPANY, a national banking
association, as trustee (the
"Trustee").
The Depositor is the owner of the Trust Fund that is hereby
conveyed to
the Trustee in return for the Certificates.
The Trust Fund for federal income
tax purposes will consist of two (i) two
real estate mortgage investment
conduits, (ii) the right to receive
payments distributable to the Class P
Certificates pursuant to Section 4.04(b)(i)
hereof and (iii) the grantor trusts
described in Section 2.07 hereof. The Lower
Tier REMIC will consist of all of
the assets constituting the Trust Fund
(other than the assets described in
clauses (ii) and (iii) above and the Lower
Tier REMIC Regular Interests) and
will be evidenced by the Lower Tier REMIC
Regular Interests (which will be
uncertificated and will represent the
"regular interests" in the Lower Tier
REMIC) and the Class LTR Interest as the
single "residual interest" in the Lower
Tier REMIC. The Trustee will hold the Lower
Tier REMIC Regular Interests. The
Upper Tier REMIC will consist of the Lower
Tier REMIC Regular Interests and will
be evidenced by the REMIC Regular Interests
(which will represent the "regular
interests" in the Upper Tier REMIC) and the
Residual Interest as the single
"residual interest" in the Upper Tier
REMIC. The Class R Certificate will
represent beneficial ownership of the Class
LTR Interest and the Residual
Interest. The "latest possible maturity
date" for federal income tax purposes of
all interests created hereby will be the
Latest Possible Maturity Date.
All covenants and agreements made by the Sellers in the Sale
Agreement
and by the Depositor and the Trustee herein
with respect to the Mortgage Loans
and the other property constituting the
Trust Fund are for the benefit of the
Holders from time to time of the
Certificates.
In consideration of the mutual agreements herein contained, the
Depositor, the Master Servicer, the
Securities Administrator, each Servicer and
the Trustee hereby agree as follows:
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and
phrases,
unless the context otherwise requires,
shall have the following meanings:
Accepted Master Servicing Practices: With respect to any Mortgage
Loan,
as applicable, either (x) those customary
mortgage master servicing practices of
prudent master servicing institutions that
master service mortgage loans of the
same type and quality as such Mortgage Loan
in the jurisdiction where the
related Mortgaged Property is located, to
the extent applicable to the Master
Servicer (except in its capacity as
successor to a Servicer), or (y) as provided
in Section 11.01 hereof, but in no event
below the standard set forth in clause
(x) of this definition.
Accepted Servicing Practices: Each Servicer's respective normal
servicing practices, which will conform to
the mortgage servicing practices of
prudent mortgage lending institutions which
service for their own account
mortgage loans of the same type as the
Mortgages Loans in the jurisdictions in
which the related Mortgaged Properties are
located.
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Accrual Period: With respect to each Class of Class A, Class M
and
Class B-3 Certificates and the Lower Tier
REMIC Interests and any Distribution
Date, the period commencing on the
immediately preceding Distribution Date (or,
in the case of the first Distribution Date,
the Closing Date) and ending on the
day immediately preceding such Distribution
Date and with respect to each Class
of Class B-1, Class B-2, Class B-4 and
Class B-5 Certificates and any
Distribution Date, the calendar month
immediately preceding the month in which
such Distribution Date occurs. All
calculations of interest on each Class of
Class A, Class M and Class B-3 Certificates
and the Lower Tier REMIC Interests
will be made on the basis of the actual
number of days elapsed in the related
Accrual Period and a 360 day year and all
calculations of interest on each Class
of Class B-1, Class B-2, Class B-4 and
Class B-5 Certificates will be made on a
the basis of a 360 day year consisting of
twelve 30-day months.
Advance: The aggregate of the advances required to be made by a
Servicer with respect to any Distribution
Date pursuant to Section 4.01, the
amount of any such advances being equal to
the sum of the aggregate of payments
of principal and interest (net of the
related Servicing Fees) on the related
Mortgage Loans that were due during the
applicable Due Period and not received
as of the close of business on the related
Determination Date, less the
aggregate amount of any such Delinquent
payments that such Servicer has
determined would constitute a
Non-Recoverable Advance were an advance to be made
with respect thereto; provided, however,
that with respect to any Mortgage Loan
that is 150 days delinquent or more
(whether or not the Mortgage Loan has been
converted to an REO Property), there will
be no obligation to make advances and,
provided further, however, that with
respect to any Mortgage Loan that has been
converted to an REO Property which is less
than 150 days delinquent, the
obligation to make Advances shall only be
to payments of interest.
Advance Facility: A financing or other facility as described in
Section
10.07.
Advancing Person: A Person to whom a Servicer's rights under
this
Agreement to be reimbursed for any Advances
or Servicing Advances has been
assigned pursuant to Section 10.07.
Affiliate: With respect to any specified Person, any other
Person
controlling, controlled by or under common
control with such Person. For the
purposes of this definition, "control"
means the power to direct the management
and policies of a Person, directly or
indirectly, whether through ownership of
voting securities, by contract or
otherwise; and the terms "controlling" and
"controlled" have meanings correlative to
the foregoing.
Aggregate Certificate Principal Balance: For any date of
determination,
the sum of the Class A-1A Certificate
Principal Balance, the Class A-1B
Certificate Principal Balance, the Class R
Certificate Principal Balance, the
Class M-1 Certificate Principal Balance,
the Class M-2 Certificate Principal
Balance, the Class B-1 Certificate
Principal Balance, the Class B-2 Certificate
Principal Balance, the Class B-3
Certificate Principal Balance, the Class B-4
Certificate Principal Balance and the Class
B-5 Certificate Principal Balance,
in each case as of such date of
determination.
Agreement: This Pooling and Servicing Agreement and any and all
amendments or supplements hereto made in
accordance with the terms herein.
Applied Realized Loss Amount: With respect to any Distribution
Date,
the amount, if any, by which the sum of (i)
the Aggregate Certificate Principal
Balance and (ii) the Class C Certificate
Principal Balance after distributions
of principal on such Distribution Date
exceeds the aggregate Stated Principal
Balance of the Mortgage Loans as of such
Distribution Date.
Appraised Value: With respect to a Mortgage Loan the proceeds of
which
were used to purchase the related Mortgaged
Property, the "Appraised Value" of a
Mortgaged Property is the lesser of (1)
the
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<PAGE>
appraised value based on an appraisal made
for a Seller by an independent fee
appraiser at the time of the origination of
the related Mortgage Loan, and (2)
the sales price of such Mortgaged Property
at such time of origination. With
respect to a Mortgage Loan the proceeds of
which were used to refinance an
existing mortgage loan, the "Appraised
Value" is the appraised value of the
Mortgaged Property based upon the appraisal
obtained at the time of refinancing.
Assignment of Mortgage: An assignment of the Mortgage, notice
of
transfer or equivalent instrument, in
recordable form, sufficient under the laws
of the jurisdiction where the related
Mortgaged Property is located to reflect
of record the sale and assignment of the
Mortgage Loan to the Trustee, which
assignment, notice of transfer or
equivalent instrument may, if permitted by
law, be in the form of one or more blanket
assignments covering Mortgages
secured by Mortgaged Properties located in
the same county.
Auction: The one-time auction conducted by the Securities
Administrator, as described in Section
9.01(b) hereof.
Auction Date: The date on which the Auction occurs.
Authenticating Agent: As defined in Section 5.10.
Available Funds Cap: As of any Distribution Date with respect to
the
Class A, Class M and Class B-3
Certificates, a per annum rate equal to 12 times
the quotient of (i) the total scheduled
interest on the Mortgage Loans based on
the Net Mortgage Rates in effect on the
related Due Date, divided by (ii) the
Aggregate Certificate Principal Balance for
such Distribution Date with such
rate being multiplied by 30 and divided by
the actual number of days in the
related Accrual Period and as of any
Distribution Date with respect to the Class
B-1, Class B-2, Class B-4 and Class B-5
Certificates, a per annum rate equal to
12 times the quotient of (i) the total
scheduled interest on the Mortgage Loans
based on the Net Mortgage Rates in effect
on the related Due Date, divided by
(ii) the Aggregate Certificate Principal
Balance for such Distribution Date.
Balloon Loan: A Mortgage Loan having an original term to stated
maturity of approximately 15 years or 20
years which provides for level monthly
payments of principal and interest based on
a 30-year amortization schedule,
with a balloon payment of the remaining
outstanding principal balance due on
such Mortgage Loan at its stated
maturity.
Book-Entry Certificates: Any of the Certificates that shall be
registered in the name of the Depository or
its nominee, the ownership of which
is reflected on the books of the Depository
or on the books of a Person
maintaining an account with the Depository
(directly, as a "Depository
Participant", or indirectly, as an indirect
participant in accordance with the
rules of the Depository and as described in
Section 5.06). As of the Closing
Date, each of the Class A, Class M and
Class B Certificates constitutes a Class
of Book-Entry Certificates.
Bring Down Letters: Those certain letter agreements, dated as of
June
28, 2005 between MLMC and certain
Transferors set out on Exhibit J-1 hereto and
those certain letter agreements, dated as
of June 28, 2005 between MLML and
certain Transferors set out on Exhibit J-2
hereto.
Business Day: Any day other than (1) a Saturday or a Sunday, or (2)
a
day on which banking institutions in the
State of California, State of Maryland,
State of Minnesota, State of Oregon and in
the City of New York, New York are
authorized or obligated by law or executive
order to be closed.
-3-
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Certificate: Any one of the certificates of any Class executed by
the
Securities Administrator and authenticated
by the Authenticating Agent in
substantially the forms attached hereto as
Exhibits A.
Certificate Account: The separate Eligible Account created and
maintained by the Securities Administrator
pursuant to Section 3.05(e) in the
name of the Trustee for the benefit of the
Certificateholders and designated
"Wells Fargo Bank, N.A., as securities
administrator for Deutsche Bank National
Trust Company, as trustee, in trust for
registered holders of Merrill Lynch
Mortgage Investors Trust, Mortgage Loan
Asset-Backed Certificates, Series
2005-SL2." Funds in the Certificate Account
shall be held in trust for the
Certificateholders for the uses and
purposes set forth in this Agreement.
Certificate Owner: With respect to a Book-Entry Certificate, the
Person
that is the beneficial owner of such
Book-Entry Certificate.
Certificate Principal Balance: As to any Certificate and as of
any
Distribution Date, the Initial Certificate
Principal Balance of such Certificate
less the sum of (1) all amounts distributed
with respect to such Certificate in
reduction of the Certificate Principal
Balance thereof on previous Distribution
Dates pursuant to Section 4.04, and (2) any
Applied Realized Loss Amounts
allocated to such Certificate on previous
Distribution Dates pursuant to Section
4.04(i). On each Distribution Date, after
all distributions of principal on such
Distribution Date, a portion of the Class C
Interest Carry Forward Amount in an
amount equal to the excess of the
Overcollateralization Amount on such
Distribution Date over the
Overcollateralization Amount as of the preceding
Distribution Date (or, in the case of the
first Distribution Date, the initial
Overcollateralization Amount (based on the
Stated Principal Balance of the
Mortgage Loans as of the Cut-Off Date))
will be added to the aggregate
Certificate Principal Balance of the Class
C Certificates (on a pro rata basis).
Notwithstanding the foregoing on any
Distribution Date relating to a Due Period
in which a Subsequent Recovery has been
received by a Servicer, the Certificate
Principal Balance of any Class of
Certificates then outstanding for which any
Applied Realized Loss Amount has been
allocated will be increased, in order of
seniority, by an amount equal to the lesser
of (i) the Unpaid Realized Loss
Amount for such Class of Certificates and
(ii) the total of any Subsequent
Recovery distributed on such date to the
Certificateholders (reduced by the
amount of the increase in the Certificate
Principal Balance of any more senior
Class of Certificates pursuant to this
sentence on such Distribution Date).
Certificate Register: The register maintained pursuant to Section
5.02
hereof.
Certificateholder or Holder: The Person in whose name a Certificate
is
registered in the Certificate Register
(initially, Cede & Co., as nominee for
the Depository) in the case of any Class of
Regular Certificates or the Class R
Certificate, except that solely for the
purpose of giving any consent pursuant
to this Agreement, any Certificate
registered in the name of the Depositor or
any Affiliate of the Depositor shall be
deemed not to be Outstanding and the
Percentage Interest evidenced thereby shall
not be taken into account in
determining whether the requisite amount of
Percentage Interests necessary to
effect such consent has been obtained;
provided, however, that if any such
Person (including the Depositor) owns 100%
of the Percentage Interests evidenced
by a Class of Certificates, such
Certificates shall be deemed to be Outstanding
for purposes of any provision hereof that
requires the consent of the Holders of
Certificates of a particular Class as a
condition to the taking of any action
hereunder. The Securities Administrator and
the Trustee are entitled to rely
conclusively on a certification of the
Depositor or any Affiliate of the
Depositor in determining which Certificates
are registered in the name of an
Affiliate of the Depositor.
Class: All Certificates bearing the same Class designation as set
forth
in Section 5.01 hereof.
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Class A Certificate Principal Balance: As of any date of
determination,
the sum of the Class A-1A Certificate
Principal Balance, the Class A-1B
Certificate Principal Balance and the Class
R Certificate Principal Balance.
Class A Certificates: The Class A-1A Certificates, the Class
A-1B
Certificates and the Class R
Certificate.
Class A Principal Distribution Amount: With respect to any
Distribution
Date (1) prior to the Stepdown Date or any
Distribution Date on which a Trigger
Event exists, 100% of the Principal
Distribution Amount for such Distribution
Date and (2) on or after the Stepdown Date
where a Trigger Event does not exist,
the excess of (A) the Class A Certificate
Principal Balance immediately prior to
such Distribution Date over (B) the lesser
of (i) 25.30% of the Stated Principal
Balance of the Mortgage Loans as of the end
of the immediately preceding Due
Period and (ii) the excess of the Stated
Principal Balance of the Mortgage Loans
as of the end of the immediately preceding
Due Period over the Minimum Required
Overcollateralization Amount; provided,
however, that in no event will the Class
A Principal Distribution Amount with
respect to any Distribution Date exceed the
aggregate Certificate Principal Balance of
the Class A Certificates.
Class A-1A Certificate: Any Certificate designated as a "Class
A-1A
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class A-1A Certificate Principal Balance: As of any date of
determination, the aggregate Certificate
Principal Balance of the Class A-1A
Certificates.
Class A-1A Current Interest: As of any Distribution Date, the
interest
accrued during the related Accrual Period
at the Class A-1A Pass-Through Rate on
the Class A-1A Certificate Principal
Balance as of such Distribution Date plus
the Current Interest and Interest Carry
Forward Amount portions of any previous
distributions on such Class that are
recovered as a voidable preference by a
trustee in bankruptcy, less any
Non-Supported Interest Shortfall allocated on
such Distribution Date to the Class A-1A
Certificates. For purposes of
calculating interest, principal
distributions on a Distribution Date will be
deemed to have been made on the first day
of the Accrual Period in which such
Distribution Date occurs.
Class A-1A Interest Carry Forward Amount: As of any Distribution
Date,
the sum of (1) the excess of (A) the Class
A-1A Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
A-1A Certificates with respect to interest
on such prior Distribution Dates and
(2) interest on such excess (to the extent
permitted by applicable law) at the
Class A-1A Pass-Through Rate for the
related Accrual Period.
Class A-1A Margin: As of any Distribution Date up to and including
the
Initial Optional Termination Date, 0.0900%
per annum and, as of any Distribution
Date after the Initial Optional Termination
Date, 0.1800% per annum.
Class A-1A Pass-Through Rate: For the first Distribution Date,
3.4100%
per annum. As of any Distribution Date
thereafter, the lesser of (1) One-Month
LIBOR plus the Class A-1A Margin and (2)
the Available Funds Cap for such
Distribution Date.
Class A-1B Certificate: Any Certificate designated as a "Class
A-1B
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class A-1B Certificate Principal Balance: As of any date of
determination, the aggregate Certificate
Principal Balance of the Class A-1B
Certificates.
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<PAGE>
Class A-1B Current Interest: As of any Distribution Date, the
interest
accrued during the related Accrual Period
at the Class A-1B Pass-Through Rate on
the Class A-1B Certificate Principal
Balance as of such Distribution Date plus
the Current Interest and Interest Carry
Forward Amount portions of any previous
distributions on such Class that are
recovered as a voidable preference by a
trustee in bankruptcy, less any
Non-Supported Interest Shortfall allocated on
such Distribution Date to the Class A-1B
Certificates. For purposes of
calculating interest, principal
distributions on a Distribution Date will be
deemed to have been made on the first day
of the Accrual Period in which such
Distribution Date occurs.
Class A-1B Interest Carry Forward Amount: As of any Distribution
Date,
the sum of (1) the excess of (A) the Class
A-1B Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
A-1B Certificates with respect to interest
on such prior Distribution Dates and
(2) interest on such excess (to the extent
permitted by applicable law) at the
Class A-1B Pass-Through Rate for the
related Accrual Period.
Class A-1B Margin: As of any Distribution Date up to and including
the
Initial Optional Termination Date, 0.2600%
per annum and, as of any Distribution
Date after the Initial Optional Termination
Date, 0.5200% per annum.
Class A-1B Pass-Through Rate: For the first Distribution Date,
3.5800%
per annum. As of any Distribution Date
thereafter, the lesser of (1) One-Month
LIBOR plus the Class A-1B Margin and (2)
the Available Funds Cap for such
Distribution Date.
Class B Certificates: The Class B-1 Certificates, Class B-2
Certificates, Class B-3 Certificates, Class
B-4 Certificates and Class B-5
Certificates.
Class B-1 Applied Realized Loss Amount: As of any Distribution
Date,
the sum of all Applied Realized Loss
Amounts with respect to the Mortgage Loans
which have been applied to the reduction of
the Certificate Principal Balance of
the Class B-1 Certificates.
Class B-1 Certificate: Any Certificate designated as a "Class
B-1
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class B-1 Certificate Principal Balance: As of any date of
determination, the aggregate Certificate
Principal Balance of the Class B-1
Certificates.
Class B-1 Current Interest: As of any Distribution Date, the
interest
accrued during the related Accrual Period
at the Class B-1 Pass-Through Rate on
the Class B-1 Certificate Principal Balance
as of such Distribution Date plus
the Current Interest and Interest Carry
Forward Amount portions of any previous
distributions on such Class that are
recovered as a voidable preference by a
trustee in bankruptcy, less any
Non-Supported Interest Shortfall allocated on
such Distribution Date to the Class B-1
Certificates. For purposes of
calculating interest, principal
distributions on a Distribution Date will be
deemed to have been made on the first day
of the Accrual Period in which such
Distribution Date occurs.
Class B-1 Interest Carry Forward Amount: As of any Distribution
Date,
the sum of (1) the excess of (A) the Class
B-1 Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
B-1 Certificates with respect to interest
on such prior Distribution Dates and
(2) interest on such excess (to the extent
permitted by applicable law) at the
Class B-1 Pass-Through Rate for the related
Accrual Period.
Class B-1 Pass-Through Rate: As of any Distribution Date up to
and
including the Initial Optional Termination
Date, the lesser of (1) 5.9272% per
annum and (2) the Available Funds Cap
for
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<PAGE>
such Distribution Date and, as of any
Distribution Date after the Initial
Optional Termination Date, the lesser of
(1) 6.4272% per annum and (2) the
Available Funds Cap for such Distribution
Date.
Class B-1 Principal Distribution Amount: With respect to any
Distribution Date on or after the Stepdown
Date, 100% of the Principal
Distribution Amount for such Distribution
Date if the Class A Certificate
Principal Balance, the Class M-1
Certificate Principal Balance and the Class M-2
Certificate Principal Balance have been
reduced to zero and a Trigger Event
exists, or as long as a Trigger Event does
not exist, the excess of (1) the sum
of (A) the Class A Certificate Principal
Balance (after taking into account
distributions of the Class A Principal
Distribution Amount on such Distribution
Date), (B) the Class M-1 Certificate
Principal Balance (after taking into
account distributions of the Class M-1
Principal Distribution Amount on such
Distribution Date), (C) the Class M-2
Certificate Principal Balance (after
taking into account distributions of the
Class M-2 Principal Distribution Amount
on such Distribution Date) and (D) the
Class B-1 Certificate Principal Balance
immediately prior to such Distribution Date
over (2) the lesser of (A) 70.70% of
the aggregate Stated Principal Balances of
the Mortgage Loans as of the end of
the immediately preceding Due Period and
(B) the excess of the Stated Principal
Balances of the Mortgage Loans as of the
end of the immediately preceding Due
Period over the Minimum Required
Overcollateralization Amount, provided,
however, that on any Distribution Date
prior to the Stepdown Date on which the
Class A Certificate Principal Balance and
the Class M Certificate Principal
Balance have been reduced to zero, the
Class B-1 Principal Distribution Amount
for such Distribution Date will equal the
lesser of (A) the outstanding Class
B-1 Certificate Principal Balance and (B)
100% of the Principal Distribution
Amount remaining after any distributions on
such Class A and Class M
Certificates; and provided further,
however, that in no event will the Class B-1
Principal Distribution Amount with respect
to any Distribution Date exceed the
Class B-1 Certificate Principal
Balance.
Class B-1 Unpaid Realized Loss Amount: As of any Distribution Date,
the
excess of (1) the Class B-1 Applied
Realized Loss Amount over (2) the sum of (x)
all distributions in reduction of the Class
B-1 Unpaid Realized Loss Amounts on
all previous Distribution Dates and (y) all
increases in the Certificate
Principal Balance of such Class B-1
Certificates pursuant to the last sentence
of the definition of "Certificate Principal
Balance."
Class B-2 Applied Realized Loss Amount: As of any Distribution
Date,
the sum of all Applied Realized Loss
Amounts with respect to the Mortgage Loans
which have been applied to the reduction of
the Certificate Principal Balance of
the Class B-2 Certificates.
Class B-2 Certificate: Any Certificate designated as a "Class
B-2
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class B-2 Certificate Principal Balance: As of any date of
determination, the aggregate Certificate
Principal Balance of the Class B-2
Certificates.
Class B-2 Current Interest: As of any Distribution Date, the
interest
accrued during the related Accrual Period
at the Class B-2 Pass-Through Rate on
the Class B-2 Certificate Principal Balance
as of such Distribution Date plus
the Current Interest and Interest Carry
Forward Amount portions of any previous
distributions on such Class that are
recovered as a voidable preference by a
trustee in bankruptcy, less any
Non-Supported Interest Shortfall allocated on
such Distribution Date to the Class B-2
Certificates. For purposes of
calculating interest, principal
distributions on a Distribution Date will be
deemed to have been made on the first day
of the Accrual Period in which such
Distribution Date occurs.
Class B-2 Interest Carry Forward Amount: As of any Distribution
Date,
the sum of (1) the excess of (A) the Class
B-2 Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
B-2 Certificates with respect to interest
on such prior Distribution Dates
-7-
<PAGE>
and (2) interest on such excess (to the
extent permitted by applicable law) at
the Class B-2 Pass-Through Rate for the
related Accrual Period.
Class B-2 Pass-Through Rate: As of any Distribution Date up to
and
including the Initial Optional Termination
Date, the lesser of (1) 6.1220% per
annum and (2) the Available Funds Cap for
such Distribution Date and, as of any
Distribution Date after the Initial
Optional Termination Date, the lesser of (1)
6.6220% per annum and (2) the Available
Funds Cap for such Distribution Date.
Class B-2 Principal Distribution Amount: With respect to any
Distribution Date on or after the Stepdown
Date, 100% of the Principal
Distribution Amount for such Distribution
Date if the Class A Certificate
Principal Balance, the Class M-1
Certificate Principal Balance, the Class M-2
Certificate Principal Balance and the Class
B-1 Certificate Principal Balance
have been reduced to zero and a Trigger
Event exists, or as long as a Trigger
Event does not exist, the excess of (1) the
sum of (A) the Class A Certificate
Principal Balance (after taking into
account distributions of the Class A
Principal Distribution Amount on such
Distribution Date), (B) the Class M-1
Certificate Principal Balance (after taking
into account distributions of the
Class M-1 Principal Distribution Amount on
such Distribution Date), (C) the
Class M-2 Certificate Principal Balance
(after taking into account distributions
of the Class M-2 Principal Distribution
Amount on such Distribution Date), (D)
the Class B-1 Certificate Principal Balance
(after taking into account
distributions of the Class B-1 Principal
Distribution Amount on such
Distribution Date) and (E) the Class B-2
Certificate Principal Balance
immediately prior to such Distribution Date
over (2) the lesser of (A) 74.70% of
the Stated Principal Balances of the
Mortgage Loans as of the end of the
immediately preceding Due Period and (B)
the excess of the aggregate Stated
Principal Balances of the Mortgage Loans as
of the end of the immediately
preceding Due Period over the Minimum
Required Overcollateralization Amount;
provided, however, that on any Distribution
Date prior to the Stepdown Date on
which the Class A Certificate Principal
Balance, the Class M Certificate
Principal Balance and the Class B-1
Certificate Principal Balance have been
reduced to zero, the Class B-2 Principal
Distribution Amount for such
Distribution Date will equal the lesser of
(A) the outstanding Class B-2
Principal Distribution Amount and (B) 100%
of the Principal Distribution Amount
remaining after any distributions on such
Class A, Class M and Class B-1
Certificates; and provided further,
however, that in no event will the Class B-2
Principal Distribution Amount with respect
to any Distribution Date exceed the
Class B-2 Certificate Principal
Balance.
Class B-2 Unpaid Realized Loss Amount: As of any Distribution Date,
the
excess of (1) the Class B-2 Applied
Realized Loss Amount over (2) the sum of (x)
all distributions in reduction of the Class
B-2 Unpaid Realized Loss Amounts on
all previous Distribution Dates and (y) all
increases in the Certificate
Principal Balance of such Class B-2
Certificates pursuant to the last sentence
of the definition of "Certificate Principal
Balance".
Class B-3
Applied Realized Loss Amount: As of any Distribution Date,
the sum of all Applied Realized Loss
Amounts with respect to the Mortgage Loans
which have been applied to the reduction of
the Certificate Principal Balance of
the Class B-3 Certificates.
Class B-3 Certificate: Any Certificate designated as a "Class
B-3
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class B-3 Certificate Principal Balance: As of any date of
determination, the aggregate Certificate
Principal Balance of the Class B-3
Certificates.
Class B-3 Current Interest: As of any Distribution Date, the
interest
accrued during the related Accrual Period
at the Class B-3 Pass-Through Rate on
the Class B-3 Certificate Principal Balance
as of such Distribution Date plus
the Current Interest and Interest Carry
Forward Amount portions of any
-8-
<PAGE>
previous distributions on such Class that
are recovered as a voidable preference
by a trustee in bankruptcy, less any
Non-Supported Interest Shortfall allocated
on such Distribution Date to the Class B-3
Certificates. For purposes of
calculating interest, principal
distributions on a Distribution Date will be
deemed to have been made on the first day
of the Accrual Period in which such
Distribution Date occurs.
Class B-3 Interest Carry Forward Amount: As of any Distribution
Date,
the sum of (1) the excess of (A) the Class
B-3 Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
B-3 Certificates with respect to interest
on such prior Distribution Dates and
(2) interest on such excess (to the extent
permitted by applicable law) at the
Class B-3 Pass-Through Rate for the related
Accrual Period.
Class B-3 Margin: As of any Distribution Date up to and including
the
Initial Optional Termination Date, 2.0000%
per annum and, as of any Distribution
Date after the Initial Optional Termination
Date, 3.0000% per annum.
Class B-3 Pass-Through Rate: For the first Distribution Date,
5.3200%
per annum. As of any Distribution Date
thereafter, the lesser of (1) One-Month
LIBOR plus the Class B-3 Margin and (2) the
Available Funds Cap for such
Distribution Date.
Class B-3 Principal Distribution Amount: With respect to any
Distribution Date on or after the Stepdown
Date, 100% of the Principal
Distribution Amount for such Distribution
Date if the Class A Certificate
Principal Balance, the Class M-1
Certificate Principal Balance, the Class M-2
Certificate Principal Balance, the Class
B-1 Certificate Principal Balance and
the Class B-2 Certificate Principal Balance
have been reduced to zero and a
Trigger Event exists, or as long as a
Trigger Event does not exist, the excess
of (1) the sum of (A) the Class A
Certificate Principal Balance (after taking
into account distributions of the Class A
Principal Distribution Amount on such
Distribution Date), (B) the Class M-1
Certificate Principal Balance (after
taking into account distributions of the
Class M-1 Principal Distribution Amount
on such Distribution Date), (C) the Class
M-2 Certificate Principal Balance
(after taking into account distributions of
the Class M-2 Principal Distribution
Amount on such Distribution Date), (D) the
Class B-1 Certificate Principal
Balance (after taking into account
distributions of the Class B-1 Principal
Distribution Amount on such Distribution
Date), (E) the Class B-2 Certificate
Principal Balance (after taking into
account distributions of the Class B-2
Principal Distribution Amount on such
Distribution Date) and (F) the Class B-3
Certificate Principal Balance immediately
prior to such Distribution Date over
(2) the lesser of (A) 78.60% of the
aggregate Stated Principal Balances of the
Mortgage Loans as of the end of the
immediately preceding Due Period and (B) the
excess of the Stated Principal Balances of
the Mortgage Loans as of the end of
the immediately preceding Due Period over
the Minimum Required
Overcollateralization Amount; provided,
however, that on any Distribution Date
prior to the Stepdown Date on which the
Class A Certificate Principal Balance,
the Class M Certificate Principal Balance,
the Class B-1 Certificate Principal
Balance and the Class B-2 Certificate
Principal Balance have been reduced to
zero, the Class B-3 Principal Distribution
Amount for such Distribution Date
will equal the lesser of (A) the
outstanding Class B-3 Certificate Principal
Balance and (B) 100% of the Principal
Distribution Amount remaining after any
distributions on such Class A, Class M,
Class B-1 and Class B-2 Certificates;
and provided further, however, that in no
event will the Class B-3 Principal
Distribution Amount with respect to any
Distribution Date exceed the Class B-3
Certificate Principal Balance.
Class B-3 Unpaid Realized Loss Amount: As of any Distribution Date,
the
excess of (1) the Class B-3 Applied
Realized Loss Amount over (2) the sum of (x)
all distributions in reduction of the Class
B-3 Unpaid Realized Loss Amounts on
all previous Distribution Dates and (y) all
increases in the Certificate
Principal Balance of such Class B-3
Certificates pursuant to the last sentence
of the definition of "Certificate Principal
Balance."
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<PAGE>
Class B-4 Applied Realized Loss Amount: As of any Distribution
Date,
the sum of all Applied Realized Loss
Amounts with respect to the Mortgage Loans
which have been applied to the reduction of
the Certificate Principal Balance of
the Class B-4 Certificates.
Class B-4 Certificate: Any Certificate designated as a "Class
B-4
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class B-4 Certificate Principal Balance: As of any date of
determination, the aggregate Certificate
Principal Balance of the Class B-4
Certificates.
Class B-4 Current Interest: As of any Distribution Date, the
interest
accrued during the related Accrual Period
at the Class B-4 Pass-Through Rate on
the Class B-4 Certificate Principal Balance
as of such Distribution Date plus
the Current Interest and Interest Carry
Forward Amount portions of any previous
distributions on such Class that are
recovered as a voidable preference by a
trustee in bankruptcy, less any
Non-Supported Interest Shortfall allocated on
such Distribution Date to the Class B-4
Certificates. For purposes of
calculating interest, principal
distributions on a Distribution Date will be
deemed to have been made on the first day
of the Accrual Period in which such
Distribution Date occurs.
Class B-4 Interest Carry Forward Amount: As of any Distribution
Date,
the sum of (1) the excess of (A) the Class
B-4 Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
B-4 Certificates with respect to interest
on such prior Distribution Dates and
(2) interest on such excess (to the extent
permitted by applicable law) at the
Class B-4 Pass-Through Rate for the related
Accrual Period.
Class B-4 Pass-Through Rate: As of any Distribution Date up to
and
including the Initial Optional Termination
Date, the lesser of (1) 5.5000% per
annum and (2) the Available Funds Cap for
such Distribution Date and, as of any
Distribution Date after the Initial
Optional Termination Date, the lesser of (1)
6.0000% per annum and (2) the Available
Funds Cap for such Distribution Date.
Class B-4 Principal Distribution Amount: With respect to any
Distribution Date on or after the Stepdown
Date, 100% of the Principal
Distribution Amount for such Distribution
Date if the Class A Certificate
Principal Balance, the Class M-1
Certificate Principal Balance, the Class M-2
Certificate Principal Balance, the Class
B-1 Certificate Principal Balance, the
Class B-2 Certificate Principal Balance and
the Class B-3 Certificate Principal
Balance have been reduced to zero and a
Trigger Event exists, or as long as a
Trigger Event does not exist, the excess of
(1) the sum of (A) the Class A
Certificate Principal Balance (after taking
into account distributions of the
Class A Principal Distribution Amount on
such Distribution Date), (B) the Class
M-1 Certificate Principal Balance (after
taking into account distributions of
the Class M-1 Principal Distribution Amount
on such Distribution Date), (C) the
Class M-2 Certificate Principal Balance
(after taking into account distributions
of the Class M-2 Principal Distribution
Amount on such Distribution Date), (D)
the Class B-1 Certificate Principal Balance
(after taking into account
distributions of the Class B-1 Principal
Distribution Amount on such
Distribution Date), (E) the Class B-2
Certificate Principal Balance (after
taking into account distributions of the
Class B-2 Principal Distribution Amount
on such Distribution Date), (F) the Class
B-3 Certificate Principal Balance
(after taking into account distributions of
the Class B-3 Principal Distribution
Amount on such Distribution Date) and (G)
the Class B-4 Certificate Principal
Balance immediately prior to such
Distribution Date over (2) the lesser of (A)
82.20% of the aggregate Stated Principal
Balances of the Mortgage Loans as of
the end of the immediately preceding Due
Period and (B) the excess of the Stated
Principal Balances of the Mortgage Loans as
of the end of the immediately
preceding Due Period over the Minimum
Required Overcollateralization Amount;
provided, however, that on any Distribution
Date prior to the Stepdown Date on
which the Class A Certificate Principal
Balance, the Class M Certificate
Principal Balance, the Class B-1
Certificate Principal Balance, the Class B-2
Certificate Principal Balance
-10-
<PAGE>
and the Class B-3 Certificate Principal
Balance have been reduced to zero, the
Class B-4 Principal Distribution Amount for
such Distribution Date will equal
the lesser of (A) the outstanding Class B-4
Certificate Principal Balance and
(B) 100% of the Principal Distribution
Amount remaining after any distributions
on such Class A, Class M, Class B-1, Class
B-2 and Class B-3 Certificates; and
provided further, however, that in no event
will the Class B-4 Principal
Distribution Amount with respect to any
Distribution Date exceed the Class B-4
Certificate Principal Balance.
Class B-4 Unpaid Realized Loss Amount: As of any Distribution Date,
the
excess of (1) the Class B-4 Applied
Realized Loss Amount over (2) the sum of (x)
all distributions in reduction of the Class
B-4 Unpaid Realized Loss Amounts on
all previous Distribution Dates and (y) all
increases in the Certificate
Principal Balance of such Class B-4
Certificates pursuant to the last sentence
of the definition of "Certificate Principal
Balance."
Class B-5 Applied Realized Loss Amount: As of any Distribution
Date,
the sum of all Applied Realized Loss
Amounts with respect to the Mortgage Loans
which have been applied to the reduction of
the Certificate Principal Balance of
the Class B-5 Certificates.
Class B-5 Certificate: Any Certificate designated as a "Class
B-5
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class B-5 Certificate Principal Balance: As of any date of
determination, the aggregate Certificate
Principal Balance of the Class B-5
Certificates.
Class B-5 Current Interest: As of any Distribution Date, the
interest
accrued during the related Accrual Period
at the Class B-5 Pass-Through Rate on
the Class B-5 Certificate Principal Balance
as of such Distribution Date plus
the Current Interest and Interest Carry
Forward Amount portions of any previous
distributions on such Class that are
recovered as a voidable preference by a
trustee in bankruptcy, less any
Non-Supported Interest Shortfall allocated on
such Distribution Date to the Class B-5
Certificates. For purposes of
calculating interest, principal
distributions on a Distribution Date will be
deemed to have been made on the first day
of the Accrual Period in which such
Distribution Date occurs.
Class B-5 Interest Carry Forward Amount: As of any Distribution
Date,
the sum of (1) the excess of (A) the Class
B-5 Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
B-5 Certificates with respect to interest
on such prior Distribution Dates and
(2) interest on such excess (to the extent
permitted by applicable law) at the
Class B-5 Pass-Through Rate for the related
Accrual Period.
Class B-5 Pass-Through Rate: As of any Distribution Date up to
and
including the Initial Optional Termination
Date, the lesser of (1) 5.6500% per
annum and (2) the Available Funds Cap for
such Distribution Date and, as of any
Distribution Date after the Initial
Optional Termination Date, the lesser of (1)
6.1500% per annum and (2) the Available
Funds Cap for such Distribution Date.
Class B-5 Principal Distribution Amount: With respect to any
Distribution Date on or after the Stepdown
Date, 100% of the Principal
Distribution Amount for such Distribution
Date if the Class A Certificate
Principal Balance, the Class M-1
Certificate Principal Balance, the Class M-2
Certificate Principal Balance, the Class
B-1 Certificate Principal Balance, the
Class B-2 Certificate Principal Balance,
the Class B-3 Certificate Principal
Balance and the Class B-4 Certificate
Principal Balance have been reduced to
zero and a Trigger Event exists, or as long
as a Trigger Event does not exist,
the excess of (1) the sum of (A) the Class
A Certificate Principal Balance
(after taking into account distributions of
the Class A Principal Distribution
Amount on such Distribution Date), (B) the
Class M-1 Certificate Principal
Balance (after taking into account
distributions of the Class M-1 Principal
Distribution Amount on such
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<PAGE>
Distribution Date), (C) the Class M-2
Certificate Principal Balance (after
taking into account distributions of the
Class M-2 Principal Distribution Amount
on such Distribution Date), (D) the Class
B-1 Certificate Principal Balance
(after taking into account distributions of
the Class B-1 Principal Distribution
Amount on such Distribution Date), (E) the
Class B-2 Certificate Principal
Balance (after taking into account
distributions of the Class B-2 Principal
Distribution Amount on such Distribution
Date), (F) the Class B-3 Certificate
Principal Balance (after taking into
account distributions of the Class B-3
Principal Distribution Amount on such
Distribution Date), (G) the Class B-4
Certificate Principal Balance (after taking
into account distributions of the
Class B-4 Principal Distribution Amount on
such Distribution Date) and (H) the
Class B-5 Certificate Principal Balance
immediately prior to such Distribution
Date over (2) the lesser of (A) 85.80% of
the aggregate Stated Principal
Balances of the Mortgage Loans as of the
end of the immediately preceding Due
Period and (B) the excess of the Stated
Principal Balances of the Mortgage Loans
as of the end of the immediately preceding
Due Period over the Minimum Required
Overcollateralization Amount; provided,
however, that on any Distribution Date
prior to the Stepdown Date on which the
Class A Certificate Principal Balance,
the Class M Certificate Principal Balance,
the Class B-1 Certificate Principal
Balance, the Class B-2 Certificate
Principal Balance, the Class B-3 Certificate
Principal Balance and the Class B-4
Certificate Principal Balance have been
reduced to zero, the Class B-5 Principal
Distribution Amount for such
Distribution Date will equal the lesser of
(A) the outstanding Class B-5
Certificate Principal Balance and (B) 100%
of the Principal Distribution Amount
remaining after any distributions on such
Class A, Class M, Class B-1, Class
B-2, Class B-3 and Class B-4 Certificates;
and provided further, however, that
in no event will the Class B-5 Principal
Distribution Amount with respect to any
Distribution Date exceed the Class B-5
Certificate Principal Balance.
Class B-5 Unpaid Realized Loss Amount: As of any Distribution Date,
the
excess of (1) the Class B-5 Applied
Realized Loss Amount over (2) the sum of (x)
all distributions in reduction of the Class
B-5 Unpaid Realized Loss Amounts on
all previous Distribution Dates and (y) all
increases in the Certificate
Principal Balance of such Class B-5
Certificates pursuant to the last sentence
of the definition of "Certificate Principal
Balance."
Class C Applied Realized Loss Amount: As of any Distribution Date,
the
sum of all Applied Realized Loss Amounts
with respect to the Mortgage Loans
which have been applied to the reduction of
the Certificate Principal Balance of
the Class C Certificates.
Class C Certificate: Any Certificate designated as a "Class C
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class C Certificate Principal Balance: As of any date of
determination,
the aggregate Certificate Principal Balance
of the Class C Certificates.
Class C Current Interest: As of any Distribution Date, the
interest
accrued during the related Accrual Period
at the Class C Distributable Interest
Rate on a notional amount equal to the
aggregate principal balance of the Lower
Tier REMIC Regular Interests immediately
prior to such Distribution Date, plus
the interest portion of any previous
distributions on such Class that is
recovered as a voidable preference by a
trustee in bankruptcy, less any
Non-Supported Interest Shortfall allocated
on such Distribution Date to the
Class C Certificates.
Class C Distributable Interest Rate: The excess, if any, of (a)
the
weighted average of the interest rates on
the Lower Tier REMIC Regular Interests
over (b) two times the weighted average of
the interest rates on the Lower Tier
REMIC Regular Interests (treating for
purposes of this clause (b) the interest
rate on each of the Lower Tier REMIC Marker
Classes as being capped at the
interest rate of its Related Certificates
(as adjusted for the length of the
Accrual Period) and treating the Class LTX
Interest as being capped at zero).
The averages described in the preceding
sentence shall be weighted on the basis
of the
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<PAGE>
respective principal balances of the Lower
Tier REMIC Regular Interests
immediately prior to any date of
determination.
Class C Interest Carry Forward Amount: As of any Distribution Date,
the
excess of (A) the Class C Current Interest
with respect to prior Distribution
Dates over (B) the amount actually
distributed to the Class C Certificates with
respect to interest on such prior
Distribution Dates or added to the aggregate
Certificate Principal Balance of the Class
C Certificates.
Class C Unpaid Realized Loss Amount: As of any Distribution Date,
the
excess of (1) the Class C Applied Realized
Loss Amount over (2) the sum of (x)
all distributions in reduction of the Class
C Unpaid Realized Loss Amounts on
all previous Distribution Dates and (y) all
increases in the Certificate
Principal Balance of such Class C
Certificates pursuant to the last sentence of
the definition of "Certificate Principal
Balance."
Class LTA-1A Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal
balance equal to 1/2 of the initial
principal balance of its Related
Certificates and an interest rate equal to the
Net Rate.
Class LTA-1B Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal
balance equal to 1/2 of the initial
principal balance of its Related
Certificates and an interest rate equal to the
Net Rate.
Class LTB-1 Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal
balance equal to 1/2 of the initial
principal balance of its Related
Certificate and an interest rate equal to the
Net Rate.
Class LTB-2 Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal
balance equal to 1/2 of the initial
principal balance of its Related
Certificate and an interest rate equal to the
Net Rate.
Class LTB-3 Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal
balance equal to 1/2 of the initial
principal balance of its Related
Certificate and an interest rate equal to the
Net Rate.
Class LTB-4 Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal
balance equal to 1/2 of the initial
principal balance of its Related
Certificate and an interest rate equal to the
Net Rate.
Class LTB-5 Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal
balance equal to 1/2 of the initial
principal balance of its Related
Certificate and an interest rate equal to the
Net Rate.
Class LTM-1 Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal
balance equal to 1/2 of the initial
principal balance of its Related
Certificate and an interest rate equal to the
Net Rate.
Class LTM-2 Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal
balance equal to 1/2 of the initial
principal balance of its Related
Certificate and an interest rate equal to the
Net Rate.
Class LTR Interest: The sole class of "residual interest" in the
Lower
Tier REMIC.
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<PAGE>
Class LTX Interest: An uncertificated regular interest in the
Lower
Tier REMIC with an initial principal
balance equal to the excess of (i) the
aggregate Cut-off Date Principal Balance of
the Mortgage Loans over (ii) the
aggregate initial principal balance of the
Lower Tier REMIC Marker Classes and
an interest rate equal to the Net Rate.
Class M
Certificate Principal Balance: As of any date of determination,
the sum of the Class M-1 Certificate
Principal Balance and the Class M-2
Certificate Principal Balance.
Class M Certificates: The Class M-1 Certificates and the Class
M-2
Certificates.
Class M-1 Applied Realized Loss Amount: As of any Distribution
Date,
the sum of all Applied Realized Loss
Amounts with respect to the Mortgage Loans
which have been applied to the reduction of
the Certificate Principal Balance of
the Class M-1 Certificates.
Class M-1 Certificate: Any Certificate designated as a "Class
M-1
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class M-1 Certificate Principal Balance: As of any date of
determination, the aggregate Certificate
Principal Balance of the Class M-1
Certificates.
Class M-1 Current Interest: As of any Distribution Date, the
interest
accrued during the related Accrual Period
at the Class M-1 Pass-Through Rate on
the Class M-1 Certificate Principal Balance
as of such Distribution Date plus
the Current Interest and Interest Carry
Forward Amount portions of any previous
distributions on such Class that are
recovered as a voidable preference by a
trustee in bankruptcy, less any
Non-Supported Interest Shortfall allocated on
such Distribution Date to the Class M-1
Certificates. For purposes of
calculating interest, principal
distributions on a Distribution Date will be
deemed to have been made on the first day
of the Accrual Period in which such
Distribution Date occurs.
Class M-1 Interest Carry Forward Amount: As of any Distribution
Date,
the sum of (1) the excess of (A) the Class
M-1 Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
M-1 Certificates with respect to interest
on such prior Distribution Dates and
(2) interest on such excess (to the extent
permitted by applicable law) at the
Class M-1 Pass-Through Rate for the related
Accrual Period.
Class M-1 Margin: As of any Distribution Date up to and including
the
Initial Optional Termination Date, 0.6000%
per annum and, as of any Distribution
Date after the Initial Optional Termination
Date, 0.9000% per annum.
Class M-1 Pass-Through Rate: For the first Distribution Date,
3.9200%
per annum. As of any Distribution Date
thereafter, the lesser of (1) One-Month
LIBOR plus the Class M-1 Margin and (2) the
Available Funds Cap for such
Distribution Date.
Class M-1 Principal Distribution Amount: With respect to any
Distribution Date on or after the Stepdown
Date, 100% of the Principal
Distribution Amount for such Distribution
Date if the Class A Certificate
Principal Balance has been reduced to zero
and a Trigger Event exists, or as
long as a Trigger Event does not exist, the
excess of (1) the sum of (A) the
Class A Certificate Principal Balance
(after taking into account distributions
of the Class A Principal Distribution
Amount on such Distribution Date) and (B)
the Class M-1 Certificate Principal Balance
immediately prior to such
Distribution Date over (2) the lesser of
(A) 44.20% of the Stated Principal
Balances of the Mortgage Loans as of the
end of the immediately preceding Due
Period and (B) the excess of the aggregate
Stated Principal Balances for the
Mortgage Loans as of the end of the
immediately preceding Due Period over the
Minimum Required
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<PAGE>
Overcollateralization Amount; provided,
however, that on any Distribution Date
prior to the Stepdown Date on which the
Class A Certificate Principal Balance
been reduced to zero, the Class M-1
Principal Distribution Amount will equal the
lesser of (A) the outstanding Class M-1
Certificate Principal Balance and (B)
100% of the Principal Distribution Amount
remaining after any distributions on
such Class A Certificates; and, provided,
further that in no event will the
Class M-1 Principal Distribution Amount
with respect to any Distribution Date
exceed the Class M-1 Certificate Principal
Balance.
Class M-1 Unpaid Realized Loss Amount: As of any Distribution Date,
the
excess of (1) the Class M-1 Applied
Realized Loss Amount over (2) the sum of (x)
all distributions in reduction of the Class
M-1 Unpaid Realized Loss Amounts on
all previous Distribution Dates and (y) all
increases in the Certificate
Principal Balance of such Class M-1
Certificates pursuant to the last sentence
of the definition of "Certificate Principal
Balance."
Class M-2 Applied Realized Loss Amount: As of any Distribution
Date,
the sum of all Applied Realized Loss
Amounts with respect to the Mortgage Loans
which have been applied to the reduction of
the Certificate Principal Balance of
the Class M-2 Certificates.
Class M-2
Certificate: Any Certificate designated as a "Class M-2
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class M-2 Certificate Principal Balance: As of any date of
determination, the aggregate Certificate
Principal Balance of the Class M-2
Certificates.
Class M-2 Current Interest: As of any Distribution Date, the
interest
accrued during the related Accrual Period
at the Class M-2 Pass-Through Rate on
the Class M-2 Certificate Principal Balance
as of such Distribution Date plus
the Current Interest and Interest Carry
Forward Amount portions of any previous
distributions on such Class that are
recovered as a voidable preference by a
trustee in bankruptcy, less any
Non-Supported Interest Shortfall allocated on
such Distribution Date to the Class M-2
Certificates. For purposes of
calculating interest, principal
distributions on a Distribution Date will be
deemed to have been made on the first day
of the Accrual Period in which such
Distribution Date occurs.
Class M-2 Interest Carry Forward Amount: As of any Distribution
Date,
the sum of (1) the excess of (A) the Class
M-2 Current Interest with respect to
prior Distribution Dates over (B) the
amount actually distributed to the Class
M-2 Certificates with respect to interest
on such prior Distribution Dates and
(2) interest on such excess (to the extent
permitted by applicable law) at the
Class M-2 Pass-Through Rate for the related
Accrual Period.
Class M-2 Margin: As of any Distribution Date up to and including
the
Initial Optional Termination Date, 0.8000%
per annum and, as of any Distribution
Date after the Initial Optional Termination
Date, 1.2000% per annum.
Class M-2 Pass-Through Rate: For the first Distribution Date,
4.1200%
per annum. As of any Distribution Date
thereafter, the lesser of (1) One-Month
LIBOR plus the Class M-2 Margin and (2) the
Available Funds Cap for such
Distribution Date.
Class M-2 Principal Distribution Amount: With respect to any
Distribution Date on or after the Stepdown
Date, 100% of the Principal
Distribution Amount for such Distribution
Date if each of the Class A
Certificate Principal Balance and the Class
M-1 Certificate Principal Balance
has been reduced to zero and a Trigger
Event exists, or as long as a Trigger
Event does not exist, the excess of (1) the
sum of (A) the Class A Certificate
Principal
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<PAGE>
Balance (after taking into account
distributions of the Class A Principal
Distribution Amount on such Distribution
Date), (B) the Class M-1 Certificate
Principal Balance (after taking into
account distributions of the Class M-1
Principal Distribution Amount on such
Distribution Date) and (C) the Class M-2
Certificate Principal Balance immediately
prior to such Distribution Date over
(2) the lesser of (A) 60.70% of the
aggregate Stated Principal Balances of the
Mortgage Loans as of the end of the
immediately preceding Due Period and (B) the
excess of the Stated Principal Balances of
the Mortgage Loans as of the end of
the immediately preceding Due Period over
the Minimum Required
Overcollateralization Amount; provided,
however, that on any Distribution Date
prior to the Stepdown Date on which the
Class A Certificate Principal Balance
and the Class M-1 Certificate Principal
Balance have been reduced to zero, the
Class M-2 Principal Distribution Amount
will equal the lesser of (A) the
outstanding Class M-2 Certificate Principal
Balance and (B) 100% of the
Principal Distribution Amount remaining
after any distributions on such Class A
and Class M-1 Certificates; provided,
further, however, in no event will the
Class M-2 Principal Distribution Amount
with respect to any Distribution Date
exceed the Class M-2 Certificate Principal
Balance.
Class M-2 Unpaid Realized Loss Amount: As of any Distribution Date,
the
excess of (1) the Class M-2 Applied
Realized Loss Amount over (2) the sum of (x)
all distributions in reduction of the Class
M-2 Unpaid Realized Loss Amounts on
all previous Distribution Dates and (y) all
increases in the Certificate
Principal Balance of such Class M-2
Certificates pursuant to the last sentence
of the definition of "Certificate Principal
Balance."
Class P Certificate: Any Certificate designated as a "Class P
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class R Certificate: Any Certificate designated as a "Class R
Certificate" on the face thereof, in the
form of Exhibit A hereto, representing
the right to distributions as set forth
herein.
Class R Certificate Principal Balance: As of any date of
determination,
the aggregate Certificate Principal Balance
of the Class R Certificate.
Class R Current Interest: As of any Distribution Date, the
interest
accrued during the related Accrual Period
at the Class R Pass-Through Rate on
the Class R Certificate Principal Balance
as of such Distribution Date plus the
Current Interest and Interest Carry Forward
Amount portions of any previous
distributions on such Class that are
recovered as a voidable preference by a
trustee in bankruptcy, less any
Non-Supported Interest Shortfall allocated on
such Distribution Date to the Class R
Certificate. For purposes of calculating
interest, principal distributions on a
Distribution Date will be deemed to have
been made on the first day of the Accrual
Period in which such Distribution Date
occurs.
Class R Interest Carry Forward Amount: As of any Distribution Date,
the
sum of (1) the excess of (A) the Class R
Current Interest with respect to prior
Distribution Dates over (B) the amount
actually distributed to the Class R
Certificate with respect to interest on
such prior Distribution Dates and (2)
interest on such excess (to the extent
permitted by applicable law) at the Class
R Pass-Through Rate for the related Accrual
Period.
Class R Margin: As of any Distribution Date up to and including
the
Initial Optional Termination Date, 0.0900%
per annum and, as of any Distribution
Date after the Initial Optional Termination
Date, 0.1800% per annum.
Class R Pass-Through Rate: For the first Distribution Date, 3.4100%
per
annum. As of any Distribution Date
thereafter, the lesser of (1) One-Month LIBOR
plus the Class R Margin and (2) the
Available Funds Cap for such Distribution
Date.
Closing Date: June 28, 2005.
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<PAGE>
Code: The Internal Revenue Code of 1986, including any successor
or
amendatory provisions.
Collection Account: The separate Eligible Accounts created and
initially maintained by the Servicers
pursuant to Section 3.05(d) in the name of
the Trustee for the benefit of the
Certificateholders and designated (1) in the
case of Wilshire, "Wilshire Credit
Corporation, as servicer for Deutsche Bank,
National Trust Company, as trustee, in
trust for registered holders of Merrill
Lynch Mortgage Investors Trust, Mortgage
Loan Asset-Backed Certificates, Series
2005-SL2" and (2) in the case of PHH, "PHH
Mortgage Corporation, as servicer for
Deutsche Bank, National Trust Company, as
trustee, in trust for registered
holders of Merrill Lynch Mortgage Investors
Trust, Mortgage Loan Asset-Backed
Certificates, Series 2005-SL2". Funds in
the Collection Account shall be held in
trust for the Certificateholders for the
uses and purposes set forth in this
Agreement.
Combined Loan-to-Value Ratio: The fraction, expressed as a
percentage,
the numerator of which is the sum of (1)
the original principal balance of the
related Mortgage Loan and (2) any
outstanding principal balances of Mortgage
Loans the liens on which are senior to the
lien on such related Mortgage Loan
(such sum calculated at the date of
origination of such related Mortgage Loan)
and the denominator of which is the lesser
of (A) the Appraised Value of the
related Mortgaged Property and (B) the
sales price of the related Mortgaged
Property at time of origination.
Compensating Interest: With respect to the Wilshire Serviced Loans,
for
any Distribution Date and all Principal
Prepayments in full in respect of a
Mortgage Loan that are received during the
period from the first day of the
related Prepayment Period through the last
day of the calendar month preceding
such Distribution Date, a payment made by
Wilshire in an amount not to exceed
the product of (a) one-twelfth of 0.25% and
(b) the aggregate Stated Principal
Balance of the Mortgage Loans for such
Distribution Date, equal to the amount of
interest at the Net Mortgage Rate for that
Mortgage Loan from the date of
prepayment through the 30th day of such
preceding calendar month; provided that
any month consisting of less than 30 days
shall be deemed to consist of 30 days.
With respect to the PHH Serviced Loans, for
any Distribution Date and all
Principal Prepayments in full in respect of
a Mortgage Loan that are received
during the period from the first day of the
related Prepayment Period through
the last day of the related Prepayment
Period preceding such Distribution Date,
a payment made by PHH in an amount not to
exceed the product of (a) one-twelfth
of 0.25% and (b) the aggregate Stated
Principal Balance of the Mortgage Loans
for such Distribution Date, equal to the
amount of any Prepayment Interest
Shortfall for such date.
Current Interest: Any of the Class A-1A Current Interest, the
Class
A-1B Current Interest, the Class R Current
Interest, the Class M-1 Current
Interest, the Class M-2 Current Interest,
the Class B-1 Current Interest, the
Class B-2 Current Interest, the Class B-3
Current Interest, the Class B-4
Current Interest, the Class B-5 Current
Interest and the Class C Current
Interest.
Custodian: The Master Servicer, in its role as Custodian.
Cut-off Date: June 1, 2005.
Cut-off Date Principal Balance: As to any Mortgage Loan, the
unpaid
principal balance thereof as of the close
of business on the calendar day
immediately preceding the Cut-off Date
after application of all payments of
principal due on or prior to the Cut-off
Date, whether or not received, and all
Principal Prepayments received prior to the
Cut-off Date, but without giving
effect to any installments of principal
received in respect of Due Dates after
the Cut-off Date.
DBRS: Dominion Bond Rating Service, Inc. or any successor in
interest.
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<PAGE>
Definitive Certificates: As defined in Section 5.06.
Deleted Mortgage Loan: A Mortgage Loan replaced or to be replaced
by a
Replacement Mortgage Loan.
Delinquent: A Mortgage Loan is "delinquent" if any payment due
thereon
is not made pursuant to the terms of such
Mortgage Loan by the close of business
on the day such payment is scheduled to be
due. A Mortgage Loan is "30 days
delinquent" if such payment has not been
received by the close of business on
the corresponding day of the month
immediately succeeding the month in which
such payment was due, or, if there is no
such corresponding day (e.g., as when a
30-day month follows a 31-day month in
which a payment was due on the 31st day
of such month), then on the last day of
such immediately succeeding month. With
respect to any Mortgage Loan due on any day
other than the first day of the
month, such Mortgage Loan shall be deemed
to be due on the first day of the
immediately succeeding month. Similarly for
"60 days delinquent," "90 days
delinquent" and so on.
Denomination: With respect to each Certificate, the amount set
forth on
the face thereof as the "Initial Principal
Balance of this Certificate."
Depositor: Merrill Lynch Mortgage Investors, Inc., a Delaware
corporation, or any successor in
interest.
Depository: The initial Depository shall be The Depository
Trust
Company ("DTC"), the nominee of which is
Cede & Co., or any other organization
registered as a "clearing agency" pursuant
to Section 17A of the Securities
Exchange Act of 1934, as amended. The
Depository shall initially be the
registered Holder of the Book-Entry
Certificates. The Depository shall at all
times be a "clearing corporation" as
defined in Section 8-102(3) of the Uniform
Commercial Code of the State of New
York.
Depository Agreement: With respect to Classes of Book-Entry
Certificates, the agreement between the
Securities Administrator and the initial
Depository.
Depository Participant: A broker, dealer, bank or other
financial
institution or other Person for whom from
time to time a Depository effects
book-entry transfers and pledges of
securities deposited with the Depository.
Designated Transaction: A transaction in which the assets
underlying
the Certificates consist of single-family
residential, multi-family residential,
home equity, manufactured housing and/or
commercial mortgage obligations that
are secured by single-family residential,
multi-family residential, commercial
real property or leasehold interests
therein.
Determination Date: With respect to any Distribution Date, the 15th
day
of the month of such Distribution Date or,
if such 15th day is not a Business
Day, the immediately preceding Business
Day.
Disqualified Organization: (1) the United States, any state or
political subdivision thereof, any foreign
government, any international
organization, or any agency or
instrumentality of any of the foregoing, (2) any
organization (other than a cooperative
described in Section 521 of the Code)
which is exempt from tax under Chapter 1 of
Subtitle A of the Code unless such
organization is subject to the tax imposed
by Section 511 of the Code and (3)
any organization described in Section
1381(a)(2)(C) of the Code.
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<PAGE>
Distribution Date: The 25th day of each calendar month after
the
initial issuance of the Certificates, or if
such 25th day is not a Business Day,
the next succeeding Business Day,
commencing in July 2005.
Due Date: With respect to any Distribution Date and any Mortgage
Loan,
the day during the related Due Period on
which a Scheduled Payment is due.
Due Period: With respect to any Distribution Date, the period
beginning
on the second day of the calendar month
preceding the calendar month in which
such Distribution Date occurs and ending on
the first day of the month in which
such Distribution Date occurs.
Eligible Account: An account that is (1) maintained with a
depository
institution the long-term unsecured debt
obligations of which are rated by each
Rating Agency in one of its two highest
rating categories, or (2) maintained
with the corporate trust department of a
bank which (A) has a rating of at least
Baa3 or P-3 by Moody's and (B) is either
the Depositor or the corporate trust
department of a national bank or banking
corporation which has a rating of at
least A-1 by S&P or F1 by Fitch, or
(iii) an account or accounts the deposits in
which are fully insured by the FDIC, or
(iv) an account or accounts, acceptable
to each Rating Agency without reduction or
withdrawal of the rating of any Class
of Certificates, as evidenced in writing,
by a depository institution in which
such accounts are insured by the FDIC (to
the limit established by the FDIC),
the uninsured deposits in which accounts
are otherwise secured such that, as
evidenced by an Opinion of Counsel
delivered to and acceptable to the Securities
Administrator, the Trustee and each Rating
Agency, the Certificateholders have a
claim with respect to the funds in such
account and a perfected first security
interest against any collateral (which
shall be limited to Permitted
Investments) securing such funds that is
superior to claims of any other
depositors or creditors of the depository
institution with which such account is
maintained, or (v) maintained at an
eligible institution whose commercial paper,
short-term debt or other short-term
deposits are rated at least A-1+ by S&P and
F-1+ by Fitch, or (vi) maintained with a
federal or state chartered depository
institution the deposits in which are
insured by the FDIC to the applicable
limits and the short-term unsecured debt
obligations of which (or, in the case
of a depository institution that is a
subsidiary of a holding company, the
short-term unsecured debt obligations of
such holding company) are rated A-1 by
S&P, F-1 by Fitch or Prime-1 by Moody's
at the time any deposits are held on
deposit therein, or (vii) otherwise
acceptable to each Rating Agency, as
evidenced by a letter from each Rating
Agency to the Securities Administrator
and the Trustee.
ERISA: The Employee Retirement Income Security Act of 1974,
including
any successor or amendatory provisions.
ERISA-Qualifying Underwriting: A best efforts or firm
commitment
underwriting or private placement that
would satisfy the requirements would
satisfy the requirements of Prohibited
Transaction Exemption 90-29, Exemption
Application No. D-8012, 55 Fed. Reg. 21459
(1990), as amended, granted by the
United States Department of Labor (or any
other applicable underwriter's
exemption granted by the United States
Department of Labor), except, in relevant
part, for the requirement that the
certificates have received a rating at the
time of acquisition that is in one of the
three (or four, in the case of a
"designated transaction") highest generic
rating categories by at least one of
S&P, Moody's or Fitch.
ERISA Restricted Certificates: The Class C Certificates, Class
P
Certificates, Class R Certificate and Class
B-5 Certificates and any other
Certificate, unless the acquisition and
holding of such other Certificate is
covered by and exempt under an
underwriter's exemption.
Event of Default: As defined in Section 7.01 hereof.
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<PAGE>
Excess Interest: On any Distribution Date, for the Class A-1A
Certificates, Class A-1B Certificates,
Class R Certificate, Class M-1
Certificates, Class M-2 Certificates, Class
B-1 Certificates, Class B-2
Certificates, Class B-3 Certificates, Class
B-4 Certificates and Class B-5
Certificates, the excess, if any, of (1)
the amount of interest such Class of
Certificates is entitled to receive on such
Distribution Date at its
Pass-Through Rate over (2) the amount of
interest such Class of Certificates
would have been entitled to receive on such
Distribution Date had the
Pass-Through Rate for such Class been the
REMIC Pass-Through Rate.
Excess Proceeds: With respect to any Liquidated Loan, any
Liquidation
Proceeds that are in excess of the sum of
(1) the unpaid principal balance of
such Liquidated Loan as of the date of such
liquidation plus (2) interest at the
Mortgage Rate from the Due Date as to which
interest was last paid or advanced
to Certificateholders (and not reimbursed
to the related Servicer) up to the Due
Date in the month in which such Liquidation
Proceeds are required to be
distributed on the unpaid principal balance
of such Liquidated Loan outstanding
during each Due Period as to which such
interest was not paid or advanced.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Extra Principal Distribution Amount: With respect to any
Distribution
Date, (1) prior to the Stepdown Date, the
excess of (A) the sum of (i) the
Aggregate Certificate Principal Balance
immediately preceding such Distribution
Date reduced by the Principal Funds with
respect to such Distribution Date and
(ii) $33,557,342 over (B) the Pool Stated
Principal Balance of the Mortgage
Loans as of such Distribution Date and (2)
on and after the Stepdown Date, (A)
the sum of (x) the Aggregate Certificate
Principal Balance immediately preceding
such Distribution Date, reduced by the
Principal Funds with respect to such
Distribution Date and (y) the greater of
(a) 14.20% of the Pool Stated Principal
Balance of the Mortgage Loans and (b) the
Minimum Required Overcollateralization
Amount less (B) the Pool Stated Principal
Balance of the Mortgage Loans as of
such Distribution Date; provided, however,
that if on any Distribution Date a
Trigger Event is in effect, the Extra
Principal Distribution Amount will not be
reduced to the applicable percentage of the
then-current Pool Stated Principal
Balance of the Mortgage Loans (and will
remain fixed at the applicable
percentage of the aggregate Stated
Principal Balance of the Mortgage Loans as of
the Due Date immediately prior to the
Trigger Event) until the next Distribution
Date on which the Trigger Event is not in
effect.
Fannie Mae: A federally chartered and privately owned
corporation
organized and existing under the Federal
National Mortgage Association Charter
Act, or any successor thereto.
FDIC: The Federal Deposit Insurance Corporation, or any
successor
thereto.
Fitch: Fitch, Inc., or any successor in interest.
Floating Rate Certificate Carryover: With respect to a
Distribution
Date, in the event that the Pass-Through
Rate for a Class of the Class A, Class
M or Class B Certificates is based upon the
Available Funds Cap, the excess of
(x) the amount of interest that such Class
would have been entitled to receive
on such Distribution Date had the
Pass-Through Rate for that Class not been
calculated based on the Available Funds Cap
over (y) the amount of interest
payable on such Class on such Distribution
Date based on the Available Funds
Cap, together with (i) the unpaid portion
of any such excess from prior
Distribution Dates (and interest accrued
thereon at the then applicable
Pass-Through Rate for such Class, without
giving effect to the Available Funds
Cap) and (ii) any amount previously
distributed with respect to Floating Rate
Certificate Carryover for such Class that
is recovered as a voidable preference
by a trustee in bankruptcy.
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Freddie Mac: A corporate instrumentality of the United States
created
and existing under Title III of the
Emergency Home Finance Act of 1970, as
amended, or any successor thereto.
Grantor Trusts: The grantor trusts described in Section 2.07
hereof.
Initial Certificate Principal Balance: With respect to any Class
A,
Class M, Class B or Class C Certificate,
the Certificate Principal Balance of
such Certificate or any predecessor
Certificate on the Closing Date as set forth
in Section 5.01 hereof.
Initial Optional Termination Date: The Distribution Date on which
the
aggregate Stated Principal Balance of the
Mortgage Loans is equal to or less
than 10% of the aggregate Stated Principal
Balance of the Mortgage Loans as of
the Cut-off Date.
Institutional Accredited Investors: Institutions which are
"accredited
investors" within the meaning of Rule
501(a)(1), (2), (3) or (7) promulgated
pursuant to Regulation D.
Insurance Policy: With respect to any Mortgage Loan included in
the
Trust Fund, any insurance policy, including
all riders and endorsements thereto
in effect with respect to such Mortgage
Loan, including any replacement policy
or policies for any insurance policies.
Insurance Proceeds: Proceeds paid in respect of the Mortgage
Loans
pursuant to any Insurance Policy or any
other insurance policy covering a
Mortgage Loan, to the extent such proceeds
are payable to the mortgagee under
the Mortgage, a Servicer or the Trustee
under the deed of trust and are not
applied to the restoration of the related
Mortgaged Property or released to the
Mortgagor in accordance with the procedures
that such Servicer would follow in
servicing mortgage loans held for its own
account, in each case other than any
amount included in such Insurance Proceeds
in respect of Insured Expenses.
Insured Expenses: Expenses covered by an Insurance Policy or any
other
insurance policy with respect to the
Mortgage Loans.
Interest Carry Forward Amount: Any of the Class A-1A Interest
Carry
Forward Amount, the Class A-1B Interest
Carry Forward Amount, the Class R
Interest Carry Forward Amount, the Class
M-1 Interest Carry Forward Amount, the
Class M-2 Interest Carry Forward Amount,
the Class B-1 Interest Carry Forward
Amount, the Class B-2 Interest Carry
Forward Amount, the Class B-3 Interest
Carry Forward Amount, the Class B-4
Interest Carry Forward Amount, the Class B-5
Interest Carry Forward Amount or the Class
C Interest Carry Forward Amount, as
the case may be.
Interest Determination Date: With respect to the Class A, Class M
and
Class B-3 Certificates, (i) for any Accrual
Period other than the first Accrual
Period, the second LIBOR Business Day
preceding the commencement of such Accrual
Period and (ii) for the first Accrual
Period, June 24, 2005.
Interest Funds: With respect to any Distribution Date, the sum,
without
duplication, of (1) all scheduled interest
due during the related Due Period and
received before the related Servicer
Remittance Date or advanced on or before
the related Servicer Remittance Date less
the Servicing Fees and the Securities
Administrator Fee, (2) all Advances
relating to interest with respect to the
Mortgage Loans, (3) all Compensating
Interest with respect to the Mortgage
Loans, (4) Liquidation Proceeds with
respect to the Mortgage Loans (to the
extent such Liquidation Proceeds relate to
interest) collected during the
related Prepayment Period, (5) all proceeds
of any purchase pursuant to Section
2.02 or 2.03 during the related Prepayment
Period or pursuant to Section 9.01
not later than the related Determination
Date (to the extent that such proceeds
relate to interest) less the Servicing Fees
and (6) all Prepayment Charges
received with respect to the Mortgage Loans
during the related Prepayment
Period, less (A) all Non-
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Recoverable Advances relating to interest
and (B) other amounts reimbursable to
a Servicer, the Master Servicer, the
Securities Administrator and the Trustee
pursuant to this Agreement.
Latest Possible Maturity Date: The latest maturity date for any
Mortgage Loan in the Trust Fund plus one
year.
LIBOR Business Day: Any day on which banks in the City of
London,
England and New York City, U.S.A. are open
and conducting transactions in
foreign currency and exchange.
Liquidated Loan: With respect to any Distribution Date, a
defaulted
Mortgage Loan that either (a) has been
liquidated through deed-in-lieu of
foreclosure, foreclosure sale, trustee's
sale or other realization as provided
by applicable law governing the real
property subject to the related Mortgage
and any security agreements and as to which
a Servicer has certified (in
accordance with Section 3.12) in the
related Prepayment Period that it has
received all amounts it expects to receive
in connection with such liquidation
or (b) is delinquent 180 days or longer, as
to which a Servicer has certified in
a certificate of an officer of such
Servicer delivered to the Securities
Administrator and the Trustee that it does
not believe that there is a
reasonable likelihood that any further net
proceeds will be received or
recovered with respect to such Mortgage
Loan.
Liquidation Proceeds: Amounts, including Insurance Proceeds,
received
in connection with the partial or complete
liquidation of Mortgage Loans,
whether through trustee's sale, foreclosure
sale, sale by a Servicer pursuant to
this Agreement or otherwise or amounts
received in connection with any
condemnation or partial release of a
Mortgaged Property and any other proceeds
received in connection with an REO
Property, less the sum of related
unreimbursed Advances, Servicing Fees,
Servicing Advances and any other expenses
related to such Mortgage Loan.
Losses: Any losses, claims, damages, liabilities or expenses
collectively.
Lower Tier REMIC: As described in the Preliminary Statement and
Section
2.07.
Lower Tier REMIC Interests: Each of the Class LTA-1A Interest,
the
Class LTA-1B Interest, the Class LTM-1
Interest, the Class LTM-2 Interest, the
Class LTB-1 Interest, the Class LTB-2
Interest, the Class LTB-3 Interest, the
Class LTB-4 Interest, the Class LTB-5
Interest, the Class LTX Interest and the
Class LTR Interest.
Lower Tier REMIC Marker Classes: Each of the classes of Lower
Tier
REMIC Regular Interests other than the
Class LTX Interest.
Lower Tier REMIC Regular Interests: Each of the Lower Tier
REMIC
Interests other than the Class LTR
Interest.
Master Servicer: Wells Fargo Bank, N.A., a national banking
association, or any successor in
interest.
MERS:
Mortgage Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of
the State of Delaware, or any successor
thereto.
MERS Loan: Any Mortgage Loan registered with MERS on the MERS
System.
MERS System: The system of recording transfers of mortgage
electronically maintained by MERS.
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Minimum Required Overcollateralization Amount: An amount equal to
the
product of (x) 0.50% and (y) the Stated
Principal Balance of the Mortgage Loans
as of the Cut-off Date.
MIN: The loan number for any MERS Loan.
MLMC: Merrill Lynch Mortgage Capital Inc., a Delaware corporation,
or
its successors in interest.
MLMC Sale Agreement: The Mortgage Loan Sale and Assignment
Agreement
dated as of June 1, 2005 between the
Depositor and MLMC.
MLML: Merrill Lynch Mortgage Lending, Inc., a Delaware corporation,
or
its successors in interest.
MLML Sale Agreement: The Mortgage Loan Sale and Assignment
Agreement
dated as of June 1, 2005 between the
Depositor and MLML.
MOM Loan: Any Mortgage Loan as to which MERS is acting as
mortgagee,
solely as nominee for the originator of
such Mortgage Loan and its successors
and assigns.
Monthly Statement: The statement delivered to the
Certificateholders
pursuant to Section 4.05.
Moody's: Moody's Investors Service, Inc. or any successor in
interest.
Mortgage: With respect to a Mortgage Loan, the mortgage, deed of
trust
or other instrument creating a second lien
or a second priority ownership
interest in an estate in fee simple in real
property securing a Mortgage Note.
Mortgage File: The mortgage documents listed in Section 2.01
hereof
pertaining to a particular Mortgage Loan
and any additional documents delivered
to the Custodian to be added to the
Mortgage File pursuant to this Agreement.
Mortgage Loans: Such of the mortgage loans transferred and assigned
to
the Trustee pursuant to the provisions
hereof as from time to time are held as a
part of the Trust Fund (including any REO
Property), the mortgage loans so held
being identified in the Mortgage Loan
Schedule, notwithstanding foreclosure or
other acquisition of title of the related
Mortgaged Property. Any mortgage loan
that was intended by the parties hereto to
be transferred to the Trust Fund as
indicated by such Mortgage Loan Schedule
which is in fact not so transferred for
any reason shall continue to be a Mortgage
Loan hereunder until the Purchase
Price with respect thereto has been paid to
the Trust Fund.
Mortgage Loan Schedule: The list of Mortgage Loans (as from time
to
time amended by the Trustee to reflect the
deletion of Deleted Mortgage Loans
and the addition of Replacement Mortgage
Loans pursuant to the provisions of
this Agreement) transferred to the Trustee
as part of the Trust Fund (for
clarification purposes, the Custodian has
physical possession of the Mortgage
Files) and from time to time subject to
this Agreement, attached hereto as
Exhibit B, setting forth the following
information with respect to each Mortgage
Loan:
(i) the loan
number;
(ii)
borrower name and address;
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(iii) the
unpaid principal balance of the Mortgage Loans;
(iv)
the initial Mortgage Rate;
(v) the
original maturity date and the months remaining
before
maturity date;
(vi)
the original principal balance;
(vii) the
Cut-off Date Principal Balance;
(viii) the first
payment due date of the Mortgage Loan;
(ix)
the Combined Loan-to-Value Ratio
(x) a code
indicating whether the residential dwelling at
the time of origination was represented to be
owner-occupied;
(xi) a code indicating the
property type;
(xii)
location of the related Mortgaged Property;
(xiii) a code
indicating whether a Prepayment Charge is
applicable and, if so,
(A) the period
during which such Prepayment
Charge is in effect;
(B) the amount
of such Prepayment Charge;
(C) any
limitations or other conditions on the
enforceability of such Prepayment Charge;
and
(D) any other
information pertaining to the
Prepayment Charge specified in the related
Mortgage Note; and
(xiv) the
Credit Score and date obtained.
Mortgage Note: The original executed note or other evidence of
indebtedness evidencing the indebtedness of
a Mortgagor under a Mortgage Loan
and all amendments, modifications and
attachments thereto.
Mortgage Pool: The aggregate of the Mortgage Loans identified in
the
Mortgage Loan Schedule.
Mortgaged Property: The underlying property securing a Mortgage
Loan.
Mortgage Rate: The annual rate of interest borne by a Mortgage
Note
from time to time.
Mortgagor: The obligor on a Mortgage Note.
Net Mortgage Rate: As to each Mortgage Loan, and at any time, the
per
annum rate equal to the then current
Mortgage Rate less the Servicing Fee Rate
and the Securities Administrator Fee
Rate.
Net Rate: With respect to any interest in any REMIC and any
Distribution Date, the product of (x) the
weighted average Net Mortgage Rate for
the Mortgage Loans calculated based on the
respective
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<PAGE>
Net Mortgage Rates and the Stated Principal
Balances of such Mortgage Loans as
of the preceding Distribution Date (or, in
the case of the first Distribution
Date, as of the Cut-off Date) and (y) a
fraction, the numerator of which is 30
and the denominator of which is the actual
number of days in the related Accrual
Period for such interest.
Non-Recoverable Advance: Any portion of an Advance previously made
or
proposed to be made by a Servicer that, in
the good faith judgment of such
Servicer, will not or, in the case of a
current delinquency, would not, be
ultimately recoverable by such Servicer
from the related Mortgagor, related
Liquidation Proceeds or otherwise related
to the Mortgage Loans.
Non-Recoverable Servicing Advance: Any portion of a Servicing
Advance
previously made or proposed to be made by a
Servicer that, in the good faith
judgment of such Servicer, will not or, in
the case of a current Servicing
Advance, would not, be ultimately
recoverable by such Servicer from the related
Mortgagor, related Liquidation Proceeds or
otherwise related to the Mortgage
Loans.
Non-Supported Interest Shortfall: As defined in Section 4.02.
Offered Certificates: The Class A-1A, Class A-1B, Class M-1, Class
M-2,
Class M-3, Class B-1, Class B-2, Class B-3
and Class R Certificates.
Officer's Certificate: A certificate (1) signed by the Chairman of
the
Board, the Vice Chairman of the Board, the
President, a vice president (however
denominated), an Assistant Vice President,
the Treasurer, the Secretary, or one
of the assistant treasurers or assistant
secretaries of the Depositor, the
Master Servicer, a Servicer or the
Securities Administrator (or any other
officer customarily performing functions
similar to those performed by any of
the above designated officers and to whom,
with respect to a particular matter,
such matter is referred because of such
officer's knowledge of and familiarity
with a particular subject) or (2), if
provided for in this Agreement, signed by
a Servicing Officer, as the case may be,
and delivered to the Depositor, the
Master Servicer, a Servicer, the Securities
Administrator or the Trustee, as the
case may be, as required by this
Agreement.
One-Month LIBOR: With respect to any Accrual Period, the rate
determined by the Securities Administrator
on the related Interest Determination
Date on the basis of (a) the offered rates
for one-month United States dollar
deposits, as such rates appear on Telerate
page 3750, as of 11:00 a.m. (London
time) on such Interest Determination Date
or (b) if such rate does not appear on
Telerate Page 3750 as of 11:00 a.m. (London
time), the offered rates of the
Reference Banks for one-month United States
dollar deposits, as such rates
appear on the Reuters Screen LIBO Page, as
of 11:00 a.m. (London time) on such
Interest Determination Date. If One-Month
LIBOR is determined pursuant to clause
(b) above, on each Interest Determination
Date, One-Month LIBOR for the related
Accrual Period will be established by the
Securities Administrator as follows:
(i) If on such
Interest Determination Date two or more
Reference Banks provide such offered quotations,
One-Month LIBOR for the related Accrual Period shall
be the arithmetic mean of such offered quotations
(rounded upwards if necessary to the nearest whole
multiple of 0.03125%).
(ii)
If on such Interest Determination Date fewer than two
Reference Banks provide such offered quotations,
One-Month LIBOR for the related Accrual Period shall
be the higher of (i) One-Month LIBOR as determined on
the previous Interest Determination Date and (ii) the
Reserve Interest Rate.
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Opinion of Counsel: A written opinion of counsel, who may be
counsel
for the Depositor, the Master Servicer, a
Servicer or the Securities
Administrator reasonably acceptable to each
addressee of such opinion; provided,
however, that with respect to Section 6.04
or 10.01, or the interpretation or
application of the REMIC Provisions, such
counsel must (1) in fact be
independent of the Depositor, the Master
Servicer, the related Servicer or the
Securities Administrator, (2) not have any
direct financial interest in the
Depositor, the Master Servicer, the related
Servicer or the Securities
Administrator or in any Affiliate of any
such party, and (3) not be connected
with the Depositor, the Master Servicer,
the related Servicer or the Securities
Administrator as an officer, employee,
promoter, underwriter, trustee, partner,
director or person performing similar
functions.
Optional Termination: The termination of the trust hereunder
pursuant
to clause (a) of Section 9.01 hereof.
Optional Termination Amount: The repurchase price received by
the
Securities Administrator in connection with
any repurchase of all of the
Mortgage Loans pursuant to Section
9.01.
Optional Termination Price: On any date after the Initial
Optional
Termination Date, an amount equal to the
sum of (A) the aggregate Stated
Principal Balance of each Mortgage Loan
(other than any Mortgage Loan that has
become an REO Property) as of the
Distribution Date on which the proceeds of the
Optional Termination are distributed to the
Certificateholders, plus accrued
interest thereon at the applicable Mortgage
Rate as of the Due Date preceding
the Distribution Date on which the proceeds
of the Optional Termination are
distributed to Certificateholders and the
fair market value of any REO Property,
plus accrued interest thereon as of the
Distribution Date on which the proceeds
of the Optional Termination are distributed
to Certificateholders, (B) any
unreimbursed out-of-pocket costs and
expenses owed to the Trustee, the
Securities Administrator (including any
amounts incurred by the Securities
Administrator in connection with conducting
the Auction), the Master Servicer or
a Servicer and any unpaid or unreimbursed
Servicing Fees, Advances and Servicing
Advances, (C) any unreimbursed costs,
penalties and/or damages incurred by the
Trust Fund in connection with any violation
relating to any of the Mortgage
Loans of any predatory or abusive lending
law and (D) in the event an Auction
has been conducted, all reasonable fees and
expenses incurred by the Securities
Administrator to conduct such Auction.
OTS: The Office of Thrift Supervision.
Outstanding: With respect to the Certificates as of any date of
determination, all Certificates theretofore
executed and authenticated under
this Agreement except: (1) Certificates
theretofore canceled by the Securities
Administrator or delivered to the
Securities Administrator for cancellation; and
(2) Certificates in exchange for which or
in lieu of which other Certificates
have been executed by the Securities
Administrator and delivered by the
Securities Administrator pursuant to this
Agreement.
Outstanding Mortgage Loan: As of any Distribution Date, a Mortgage
Loan
with a Stated Principal Balance greater
than zero that was not the subject of a
Principal Prepayment in full, and that did
not become a Liquidated Loan, prior
to the end of the related Due Period.
Overcollateralization Amount: As of any date of determination,
the
excess of (1) the Stated Principal Balance
of the Mortgage Loans over (2) the
Certificate Principal Balance of the
Certificates (other than the Class P
Certificates and the Class C
Certificates).
Ownership
Interest: As to any Certificate, any ownership interest in
such Certificate including any interest in
such Certificate as the Holder
thereof and any other interest therein,
whether direct or indirect, legal or
beneficial.
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Pass-Through Rate: With respect to the Class A-1A Certificates,
the
Class A-1A Pass-Through Rate; with respect
to the Class A-1B Certificates, the
Class A-1B Pass-Through Rate; with respect
to the Class M-1 Certificates, the
Class M-1 Pass-Through Rate; with respect
to the Class M-2 Certificates, the
Class M-2 Pass-Through Rate; with respect
to the Class B-1 Certificates, the
Class B-1 Pass-Through Rate; with respect
to the Class B-2 Certificates, the
Class B-2 Pass-Through Rate; with respect
to the Class B-3 Certificates, the
Class B-3 Pass-Through Rate; with respect
to the Class B-4 Certificates, the
Class B-4 Pass-Through Rate; with respect
to the Class B-5 Certificates, the
Class B-5 Pass-Through Rate; and with
respect to the Class R Certificate, the
Class R Pass-Through Rate.
Percentage Interest: With respect to:
(i) any Class,
the percentage interest in the undivided
beneficial ownership interest evidenced by such Class
which shall be equal to the Certificate Principal
Balance of such Class divided by the aggregate
Certificate Principal Balance of all Classes; and
(ii)
any Certificate, the Percentage Interest evidenced
thereby of the related Class shall equal the
percentage obtained by dividing the Denomination of
such Certificate by the aggregate of the
Denominations of all Certificates of such Class;
except that in the case of any Class P Certificates,
the Percentage Interest with respect to such
Certificate shown on the face of such Certificate.
Permitted Activities: The primary activities of the trust
created
pursuant to this Agreement which shall
be:
(i) holding
Mortgage Loans transferred from the Depositor
and other assets of the Trust Fund, including any
credit enhancement and passive derivative financial
instruments that pertain to beneficial interests
issued or sold to parties other than the Depositor,
its Affiliates, or its agents;
(ii)
issuing Certificates and other interests in the
assets of the Trust Fund;
(iii)
receiving collections on the Mortgage Loans and
making payments on such Certificates and interests in
accordance with the terms of this Agreement; and
(iv)
engaging in other activities that are necessary or
incidental to accomplish these limited purposes,
which activities cannot be contrary to the status of
the Trust Fund as a qualified special purpose entity
under existing accounting literature.
Permitted Investments: At any time, any one or more of the
following
obligations and securities:
(i)
obligations of the United States or any agency
thereof, provided such obligations are backed by the
full faith and credit of the United States;
(ii)
general obligations of or obligations guaranteed by
any state of the United States or the District of
Columbia receiving the highest long-term debt rating
of each Rating Agency rating the Certificates;
(iii)
commercial or finance company paper, other than
commercial or finance company paper issued by the
Depositor, the Securities Administrator or any of its
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Affiliates, which is then receiving the highest
commercial or finance company paper rating of each
such Rating Agency;
(iv)
certificates of deposit, demand or time deposits, or
bankers' acceptances (other than banker's acceptances
issued by the Securities Administrator or any of its
Affiliates) issued by any depository institution or
trust company incorporated under the laws of the
United States or of any state thereof and subject to
supervision and examination by federal and/or state
banking authorities, provided that the commercial
paper and/or long term unsecured debt obligations of
such depository institution or trust company are then
rated one of the two highest long-term and the
highest short-term ratings of each such Rating Agency
for such securities;
(v) demand or
time deposits or certificates of deposit
issued by any bank or trust company or savings
institution to the extent that such deposits are
fully insured by the FDIC;
(vi)
guaranteed reinvestment agreements issued by any
bank, insurance company or other corporation rated in
the two highest long-term or the highest short-term
ratings of each Rating Agency containing, at the time
of the issuance of such agreements, such terms and
conditions as will not result in the downgrading or
withdrawal of the rating then assigned to the
Certificates by any such Rating Agency as evidenced
by a letter from each Rating Agency;
(vii)
repurchase obligations with respect to any security
described in clauses (i) and (ii) above, in either
case entered into with a depository institution or
trust company (acting as principal) described in
clause (v) above;
(viii)
securities (other than stripped bonds, stripped
coupons or instruments sold at a purchase price in
excess of 115% of the face amount thereof) bearing
interest or sold at a discount issued by any
corporation, other than the Securities Administrator
or any of its Affiliates, incorporated under the laws
of the United States or any state thereof which, at
the time of such investment, have one of the two
highest long term ratings of each Rating Agency;
(ix)
interests in any money market fund (including those
managed or advised by the Securities Administrator,
the Trustee or their respective Affiliates) which at
the date of acquisition of the interests in such fund
and throughout the time such interests are held in
such fund has the highest applicable long term rating
by each Rating Agency rating such fund; and
(x) short term
investment funds sponsored by any trust
company or national banking association incorporated
under the laws of the United States or any state
thereof, other than the Securities Administrator or
any of its Affiliates, which on the date of
acquisition has been rated by each such Rating Agency
in their respective highest applicable rating
category;
provided, that no such instrument shall be
a Permitted Investment if such
instrument (i) evidences the right to
receive interest only payments with
respect to the obligations underlying such
instrument, (ii) is purchased at a
premium or above par or (iii) is purchased
at a deep discount; provided,
further, that no such instrument shall be a
Permitted Investment (A) if such
instrument evidences principal and
interest
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payments derived from obligations
underlying such instrument and the interest
payments with respect to such instrument
provide a yield to maturity of greater
than 120% of the yield to maturity at par
of such underlying obligations, or (B)
if it may be redeemed at a price below the
purchase price (the foregoing clause
(B) not to apply to investments in units of
money market funds pursuant to
clause (ix) above); and provided, further,
(I) that no amount beneficially owned
by any REMIC (including, without
limitation, any amounts collected by a Servicer
but not yet deposited in the Collection
Account) may be invested in investments
(other than money market funds) treated as
equity interests for Federal income
tax purposes, unless such Servicer shall
receive an Opinion of Counsel, at the
expense of the party requesting that such
investment be made, to the effect that
such investment will not adversely affect
the status of the any REMIC provided
for herein as a REMIC under the Code or
result in imposition of a tax on the
Trust Fund or any REMIC provided for herein
and (II) each such investment must
be a "permitted investment" within the
meaning of Section 860G(a)(5) of the
Code. Permitted Investments that are
subject to prepayment or call may not be
purchased at a price in excess of par.
Permitted Transferee: Any Person other than (i) the United States,
any
State or political subdivision thereof, or
any agency or instrumentality of any
of the foregoing, (ii) a foreign
government, International Organization or any
agency or instrumentality of either of the
foregoing, (iii) an organization
(except certain farmers' cooperatives
described in section 521 of the Code) that
is exempt from tax imposed by Chapter 1 of
the Code (including the tax imposed
by section 511 of the Code on unrelated
business taxable income) on any excess
inclusions (as defined in section
860E(c)(1) of the Code) with respect to a
Certificate, (iv) rural electric and
telephone cooperatives described in section
1381(a)(2)(C) of the Code, and (v) a Person
that is not a citizen or resident of
the United States, a corporation or
partnership (or other entity treated as a
corporation or partnership for United
States federal income tax purposes)
created or organized in or under the laws
of the United States or any State
thereof or the District of Columbia or an
estate whose income from sources
without the United States is includable in
gross income for United States
federal income tax purposes regardless of
its connection with the conduct of a
trade or business within the United States,
or a trust if a court within the
United States is able to exercise primary
supervision over the administration of
the trust and one or more United States
persons have authority to control all
substantial decisions of the trust, unless,
in the case of this clause (v), such
Person has furnished the transferor and the
Securities Administrator with a duly
completed Internal Revenue Service Form
W-8ECI or applicable successor form. The
terms "United States," "State" and
"International Organization" shall have the
meanings set forth in section 7701 of the
Code. A corporation will not be
treated as an instrumentality of the United
States or of any State thereof for
these purposes if all of its activities are
subject to tax and, with the
exception of the Federal Home Loan Mortgage
Corporation, a majority of its board
of directors is not selected by such
government unit.
Person: Any individual, corporation, partnership, limited
liability
company, joint venture, association,
joint-stock company, trust, unincorporated
organization or government, or any agency
or political subdivision thereof.
PHH: PHH Mortgage Corporation, a New Jersey corporation, or its
successor in interest.
PHH Serviced Loans: Those Mortgage Loans identified on the
Mortgage
Loan Schedule as being serviced by PHH.
Pool Stated Principal Balance: As to any Distribution Date, the
aggregate of the Stated Principal Balances,
as of such Distribution Date, of the
Mortgage Loans that were Outstanding
Mortgage Loans as of such date.
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Prepayment Assumption: A rate of prepayment, as described in
the
Prospectus Supplement in the definition of
"Modeling Assumptions," relating to
the Offered Certificates or as described in
the Private Placement Memorandum,
relating to the Class B-4 and Class B-5
Certificates.
Prepayment Charges: Any prepayment premium or charge payable by
a
Mortgagor in connection with any Principal
Prepayment on a Mortgage Loan
pursuant to the terms of the related
Mortgage Note or Mortgage, as applicable.
Prepayment Interest Excess: With respect to the Wilshire Serviced
Loans
and any Servicer Remittance Date, for each
Mortgage Loan that was the subject of
a Principal Prepayment in full during the
portion of the related Prepayment
Period occurring between the first day of
the calendar month in which such
Servicer Remittance Date occurs and the
last day of the related Prepayment
Period, an amount equal to interest (to the
extent received) at the applicable
Net Mortgage Rate on the amount of such
Principal Prepayment for the number of
days commencing on the first day of the
calendar month in which such Servicer
Remittance Date occurs and ending on the
date on which such Principal Prepayment
is so applied.
Prepayment Interest Shortfall: With respect to the Wilshire
Serviced
Loans and any Distribution Date, for each
Mortgage Loan that was the subject of
a Principal Prepayment in full (other than
a Principal Prepayment in full
resulting from the purchase of a Mortgage
Loan pursuant to Section 2.02, 2.03 or
9.01 hereof and other than a Principal
Prepayment in full on a Mortgage Loan
received during the period from and
including the first day to and including the
14th day of the month of such Distribution
Date), the amount, if any, by which
(i) one month's interest at the applicable
Net Mortgage Rate on the Stated
Principal Balance of such Mortgage Loan as
of the preceding Distribution Date
exceeds (ii) the amount of interest paid or
collected in connection with such
Principal Prepayment. With respect to the
PHH Serviced Loans and any
Distribution Date, for each Mortgage Loan
that was the subject of a Principal
Prepayment in full (other than a Principal
Prepayment in full resulting from the
purchase of a Mortgage Loan pursuant to
Section 2.02, 2.03 or 9.01 hereof), the
amount, if any, by which (i) one month's
interest at the applicable Net Mortgage
Rate on the Stated Principal Balance of
such Mortgage Loan as of the preceding
Distribution Date exceeds (ii) the amount
of interest paid or collected in
connection with such Principal
Prepayment.
Prepayment Period: With respect to the Wilshire Serviced Loans and
any
Distribution Date, the period beginning
with the opening of business on the 15th
day of the calendar month preceding the
month in which such Distribution Date
occurs (or in the case of the first
Distribution Date, beginning with the
opening of business on the Cut-off Date)
and ending on the close of business on
the 14th day of the month in which such
Distribution Date occurs. With respect
to the PHH Serviced Loans and any
Distribution Date, the calendar month
immediately preceding the month in which
the Distribution Date occurs.
Principal Distribution Amount: With respect to each Distribution
Date,
the sum of (i) the Principal Funds for such
Distribution Date and (ii) any Extra
Principal Distribution Amount for such
Distribution Date.
Principal Funds: With respect to the Mortgage Loans and any
Distribution Date, the sum, without
duplication, of (1) the scheduled principal
due during the related Due Period and
received before the related Servicer
Remittance Date or advanced on or before
the related Servicer Remittance Date,
(2) prepayments collected in the related
Prepayment Period, (3) the Stated
Principal Balance of each Mortgage Loan
that was purchased by the Depositor
during the related Prepayment Period or, in
the case of a purchase pursuant to
Section 9.01, on the Business Day prior to
such Distribution Date, (4) the
amount, if any, by which the aggregate
unpaid principal balance of any
Replacement Mortgage Loan is
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less than the aggregate unpaid principal of
the related Deleted Mortgage Loans
delivered by a Seller in connection with a
substitution of a Mortgage Loan
pursuant to Section 2.03(c), (5) all
Liquidation Proceeds collected during the
related Prepayment Period (to the extent
such Liquidation Proceeds related to
principal), (6) all Subsequent Recoveries
received during the related Due Period
and (7) all other collections and
recoveries in respect of principal during the
related Prepayment Period less (A) all
Non-Recoverable Advances relating to
principal with respect to the Mortgage
Loans and (B) other amounts reimbursable
to the Servicers, the Master Servicer, the
Securities Administrator and the
Trustee pursuant to this Agreement
allocable to principal.
Principal Prepayment: Any Mortgagor payment or other recovery of
(or
proceeds with respect to) principal on a
Mortgage Loan (including Mortgage Loans
purchased or repurchased under Sections
2.02, 2.03 and 9.01 hereof) that is
received or recovered in advance of its
scheduled Due Date and is not
accompanied by an amount as to interest
representing scheduled interest due on
any date or dates in any month or months
subsequent to the month of prepayment.
Partial Principal Prepayments shall be
applied by the related Servicer in
accordance with the terms of the related
Mortgage Note.
Private Placement Memorandum: The Private Placement Memorandum
dated
June 28, 2005 relating to the private
placement of the Class B-4 and Class B-5
Certificates.
Prospectus Supplement: The Prospectus Supplement dated June 24,
2005,
as supplemented by a supplement dated June
28, 2005 and a supplement dated July
5, 2005, relating to the public offering of
the Offered Certificates.
PUD: A Planned Unit Development.
Purchase Price: With respect to any Mortgage Loan required to
be
repurchased by a Seller or the applicable
Transferor pursuant to Section 2.02 or
2.03 hereof, an amount equal to the sum of
(i) 100% of the unpaid principal
balance of the Mortgage Loan as of the date
of such purchase together with any
unreimbursed Servicing Advances, (ii)
accrued interest thereon at the applicable
Mortgage Rate from (a) the date through
which interest was last paid by the
Mortgagor to (b) the Due Date in the month
in which the Purchase Price is to be
distributed to Certificateholders and (iii)
any unreimbursed costs, penalties
and/or damages incurred by the Trust Fund
in connection with any violation
relating to such Mortgage Loan of any
predatory or abusive lending law.
QIB: A "qualified institutional buyer" within the meaning of Rule
144A.
Rating Agency: Any of Fitch, DBRS or Moody's. If any such
organization
or its successor is no longer in existence,
"Rating Agency" shall be a
nationally recognized statistical rating
organization, or other comparable
Person, designated by the Depositor, notice
of which designation shall be given
to the Trustee. References herein to a
given rating category of a Rating Agency
shall mean such rating category without
giving effect to any modifiers.
Realized Loss: With respect to (1) a Liquidated Loan, the amount,
if
any, by which the Stated Principal Balance
and accrued interest thereon at the
Net Mortgage Rate exceeds the amount
actually recovered by the related Servicer
with respect thereto (net of reimbursement
of Advances and Servicing Advances)
at the time such Mortgage Loan became a
Liquidated Loan or (2) with respect to a
Mortgage Loan which is not a Liquidated
Loan, any amount of principal that the
Mortgagor is no longer legally required to
pay (except for the extinguishment of
debt that results from the exercise of
remedies due to default by the
Mortgagor).
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Record Date: With respect to any Distribution Date, the close
of
business on the last Business Day of the
month preceding the month in which the
applicable Distribution Date occurs.
Reference Banks: Barclays Bank PLC, JPMorgan Chase Bank, N.A.,
Citibank, N.A., Wells Fargo Bank, N.A. and
NatWest, N.A.; provided that if any
of the foregoing banks are not suitable to
serve as a Reference Bank, then any
leading banks selected by the Securities
Administrator which are engaged in
transactions in Eurodollar deposits in the
international Eurocurrency market (i)
with an established place of business in
London, England, (ii) whose quotations
appear on the Reuters Screen LIBO Page on
the relevant Interest Determination
Date and (iii) which have been designated
as such by the Securities
Administrator.
Regular Certificate: Any one of the Class A-1A, Class A-1B, Class
M,
and Class B Certificates.
Regulation S: Regulation S promulgated under the Securities Act or
any
successor provision thereto, in each case
as the same may be amended from time
to time; and all references to any rule,
section or subsection of, or definition
or term contained in, Regulation S means
such rule, section, subsection,
definition or term, as the case may be, or
any successor thereto, in each case
as the same may be amended from time to
time.
Regulation S
Book-Entry Certificates: Certificates sold in offshore
transactions in reliance on Regulation S in
the form of one or more permanent
global Certificates in definitive, fully
registered form without interest
coupons, which shall be deposited on behalf
of the subscribers for such
Certificates represented thereby with the
Securities Administrator, as custodian
for DTC and registered in the name of a
nominee of DTC.
Related Certificates: With respect to the Class LTA-1A Interest,
the
Class A-1A and Class R Certificates. With
respect to the Class LTA-1B Interest,
the Class A-1B Certificates. With respect
to the Class LTB-1 Interest, the Class
B-1 Certificates. With respect to the Class
LTB-2 Interest, the Class B-2
Certificates. With respect to the Class
LTB-3 Interest, the Class B-3
Certificates. With respect to the Class
LTB-4 Interest, the Class B-4
Certificates. With respect to the Class
LTB-5 Interest, the Class B-5
Certificates. With respect to the Class
LTM-1 Interest, the Class M-1
Certificates. With respect to the Class
LTM-2 Interest, the Class M-2
Certificates.
Relief Act: The Servicemembers Civil Relief Act or any similar
state or
local law.
Relief Act Shortfall: With respect to any Distribution Date and
any
Mortgage Loan, any reduction in the amount
of interest or principal collectible
on such Mortgage Loan for the most recently
ended calendar month as a result of
the application of the Relief Act.
REMIC: A "real estate mortgage investment conduit" within the
meaning
of section 860D of the Code. References
herein to "the REMICs" or "a REMIC"
shall mean any of (or, as the context
requires, all of) the Lower Tier REMIC and
the Upper Tier REMIC.
REMIC Pass-Through Rate: The Pass-Through Rate for a Class of
Related
Certificates calculated by replacing
"Available Funds Cap" in such definition
with "Net Rate."
REMIC Provisions: Provisions of the federal income tax law relating
to
real estate mortgage investment conduits,
which appear at sections 860A through
860G of Subchapter M of Chapter 1 of the
Code, and related provisions, and
proposed, temporary and final regulations
and published rulings, notices and
announcements promulgated thereunder, as
the foregoing may be in effect from
time to time as well as provisions of
applicable state laws.
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REMIC Regular Interests: (i) any of the rights under any of the
Certificates (other than the Class P
Certificates, the Class R Certificate and
the Class C Certificates) other than the
rights in interest rate cap contracts
described in Section 2.07 and (ii) the
Uncertificated Class C Interest.
Remittance Report: As defined in Section 4.04(j) hereof.
REO Property: A Mortgaged Property acquired by a Servicer
through
foreclosure or deed-in-lieu of foreclosure
in connection with a defaulted
Mortgage Loan.
Replacement Mortgage Loan: A Mortgage Loan substituted by a Seller
for
a Deleted Mortgage Loan, which must, on the
date of such substitution, as
confirmed in a Request for Release,
substantially in the form of Exhibit I (1)
have a Stated Principal Balance, after
deduction of the principal portion of the
Scheduled Payment due in the month of
substitution, not in excess of, and not
less than 90% of the Stated Principal
Balance of the Deleted Mortgage Loan; (2)
with respect to any Mortgage Loan, have a
Mortgage Rate not less than or no more
than 1% per annum higher than the Mortgage
Rate of the Deleted Mortgage Loan;
(3) have a similar or higher FICO score or
credit grade than that of the Deleted
Mortgage Loan; (4) have a Combined
Loan-to-Value Ratio no higher than that of
the Deleted Mortgage Loan; (5) have a
remaining term to maturity no greater than
(and not more than one year less than) that
of the Deleted Mortgage Loan; (6)
provide for a Prepayment Charge on terms
substantially similar to those of the
Prepayment Charge, if any, of the Deleted
Mortgage Loan; (7) have the same lien
priority as the Deleted Mortgage Loan; (8)
constitute the same occupancy type as
the Deleted Mortgage Loan; and (9) comply
with each representation and warranty
set forth in Section 2.03 hereof.
Request for Release: The Request for Release of Documents submitted
by
a Servicer to the Custodian, substantially
in the form of Exhibit I hereto.
Required Insurance Policy: With respect to any Mortgage Loan,
any
insurance policy that is required to be
maintained from time to time under this
Agreement.
Required Loss Percentage: For any Distribution Date, the
applicable
percentage for such Distribution Date set
forth in the following table:
<Table>
<Caption>
DISTRIBUTION DATE OCCURRING IN
REQUIRED LOSS PERCENTAGE
------------------------------
------------------------
<S>
<C>
July 2008 - June 2009
4.75% with respect to July 2008, plus an
additional 1/12th of 3.50% for each month
thereafter
July 2009 - June 2010
8.25% with respect to July 2009, plus an
additional 1/12th of 2.75% for each month
thereafter
July 2010 - June 2011
11.00% with respect to July 2010, plus an
additional 1/12th of 2.00% for each month
thereafter
July 2011 - June 2012
13.00% with respect to July 2011, plus an
additional 1/12th of 0.75% for each month
thereafter
July 2012 and
thereafter
13.75%
</Table>
Required Percentage: As of any Distribution Date following a
Stepdown
Date, the quotient of (1) the excess of (A)
the Stated Principal Balances of the
Mortgage Loans as of such Distribution
Date, over (B) the Certificate Principal
Balance of the most senior Class of
Certificates outstanding, prior to giving
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effect to distributions to be made on such
Distribution Date and (2) the Stated
Principal Balance of the Mortgage Loans as
of such Distribution Date. As used
herein, on any Distribution Date when any
of the Class A Certificates are
outstanding, the Certificate Principal
Balance of the most senior Class of
Certificates will equal the aggregate
Certificate Principal Balance of the Class
A Certificates as of such date of
calculation.
Reserve Interest Rate: With respect to any Interest Determination
Date,
the rate per annum that the Securities
Administrator determines to be (1) the
arithmetic mean (rounded upwards if
necessary to the nearest whole multiple of
0.03125%) of the one-month United States
dollar lending rates which New York
City banks selected by the Securities
Administrator are quoting on the relevant
Interest Determination Date to the
principal London offices of leading banks in
the London interbank market or (2) in the
event that the Securities
Administrator can determine no such
arithmetic mean, the lowest one-month United
States dollar lending rate which New York
City banks selected by the Securities
Administrator are quoting on such Interest
Determination Date to leading
European banks.
Residual Interest: An interest in the Upper Tier REMIC that is
entitled
to all distributions of principal and
interest on the Class R Certificate other
than distributions in respect of the Class
LTR Interest and distributions to the
extent attributable to an interest rate in
excess of the Net Rate.
Responsible Officer: When used with respect to the Securities
Administrator or a Servicer, any officer of
the Securities Administrator or a
Servicer with direct responsibility for the
administration of this Agreement and
also means any other officer to whom, with
respect to a particular matter, such
matter is referred because of such
officer's knowledge of and familiarity with
the particular subject. When used with
respect to the Trustee, any Managing
Director, any Director, Vice President, any
Assistant Vice President, any
Associate, any Assistant Secretary, or any
other officer of the Trustee
customarily performing functions similar to
those performed by any of the above
designated officers who at such time shall
be officers to whom, with respect to
a particular matter, the matter is referred
because of the officer's knowledge
of and familiarity with the particular
subject and who has direct responsibility
for the administration of this
Agreement.
Reuters Screen LIBO Page: The display designated as page "LIBO" on
the
Reuters Monitor Money Rates Service (or
such other page as may replace such LIBO
page on that service for the purpose of
displaying London interbank offered
rates of major banks.
Rule 144A: Rule 144A under the Securities Act.
Rule 144A Book-Entry Certificates: Certificates initially offered
and
sold in reliance on the exemption from
registration under Rule 144A in the form
of one or more permanent global
Certificates in definitive, fully registered
form without interest coupons, which shall
be deposited on behalf of the
subscribers for such Certificates
represented thereby with the Securities
Administrator, as custodian for DTC and
registered in the name of a nominee of
DTC.
S&P: Standard & Poor's, a division of The McGraw-Hill
Companies, Inc.,
or any successor in interest.
Sale Agreement: Either of the MLMC Sale Agreement or the MLML
Sale
Agreement.
Scheduled Payment: The scheduled monthly payment on a Mortgage Loan
due
on any Due Date allocable to principal
and/or interest on such Mortgage Loan.
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Section 302 Requirements: Any rules or regulations promulgated
pursuant
to the Sarbanes-Oxley Act of 2002 (as such
may be amended from time to time).
Securities Act: The Securities Act of 1933, as amended.
Securities Administrator: Wells Fargo Bank, N.A., a national
banking
association, or any successor in
interest.
Securities Administrator Fee: A fee paid monthly to the
Securities
Administrator from interest collected with
respect to each Mortgage Loan equal
to the product of (a) the Securities
Administrator Fee Rate and (b) the Stated
Principal Balance of such Mortgage
Loan.
Securities Administrator Fee Rate: 0.0185% per annum for each
Mortgage
Loan.
Seller: Either of MLMC or MLML.
Servicer: Each of Wilshire and PHH, or in each case, its successor
in
interest. When the term "Servicers" is
used, such term is referring to each
Servicer acting with respect to related
Mortgage Loans serviced by it.
Servicer Advance Date: As to any Distribution Date, the related
Servicer Remittance Date.
Servicer Remittance Date: With respect to any Distribution Date,
the
later of two Business Days after the 15th
day of the month in which such
Distribution Date occurs and the 18th day
(or if such day is not a Business Day,
the next preceding Business Day) of the
month in which such Distribution Date
occurs.
Servicing Advances: All customary, reasonable and necessary "out
of
pocket" costs and expenses incurred in the
performance by a Servicer of its
servicing obligations hereunder, including,
but not limited to, the cost of (1)
the preservation, inspection, restoration
and protection of a Mortgaged
Property, including without limitation
advances in respect of real estate taxes
and assessments, (2) any collection,
enforcement or judicial proceedings,
including without limitation foreclosures,
collections and liquidations, (3) the
conservation, management, sale and
liquidation of any REO Property, (4)
executing and recording instruments of
satisfaction, deeds of reconveyance or
Assignments of Mortgage to the extent not
otherwise recovered from the related
Mortgages or payable under this Agreement,
(5) correcting errors of prior
servicers; costs and expenses charged to
the related Servicer by the Trustee or
the Securities Administrator; tax tracking;
title research; flood
certifications; lender paid mortgage
insurance, (6) obtaining or correcting any
legal documentation required to be included
in the Mortgage Files and reasonably
necessary for the related Servicer to
perform its obligations under this
Agreement and (7) compliance with the
obligations under Sections 3.01 and 3.10.
Servicing Fee: As to each Mortgage Loan and any Distribution Date,
an
amount equal to the product of (x) the
Servicing Fee Rate and (y) the Stated
Principal Balance of such Mortgage Loan as
of the preceding Distribution Date
or, in the event of any payment of interest
that accompanies a Principal
Prepayment in full made by the Mortgagor,
interest at the Servicing Fee Rate on
the Stated Principal Balance of such
Mortgage Loan as of the preceding
Distribution Date for the period covered by
such payment of interest.
Servicing Fee Rate: 0.50% per annum.
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Servicing Officer: Any officer of a Servicer involved in, or
responsible for, the administration and
servicing of the Mortgage Loans whose
name and facsimile signature appear on a
list of servicing officers furnished to
the Master Servicer, the Securities
Administrator and the Trustee by such
Servicer on the Closing Date pursuant to
this Agreement, as such lists may from
time to time be amended.
Servicing Transfer Costs: In the event that a Servicer does not
reimburse the Master Servicer or the
Trustee under this Agreement, all costs
associated with the transfer of servicing
from such predecessor Servicer,
including, without limitation, any costs or
expenses associated with the
termination of such predecessor Servicer,
the appointment of a successor
servicer, the complete transfer of all
servicing data and the completion,
correction or manipulation of such
servicing data as may be required by the
Master Servicer or any successor servicer
to correct any errors or
insufficiencies in the servicing data or
otherwise to enable the Master Servicer
or successor servicer to service the
Mortgage Loans properly and effectively.
SFAS 140: Statement of Financial Accounting Standard No. 140,
Accounting for Transfers and Servicing of
Financial Assets and Extinguishments
of Liabilities dated September 2000,
published by the Financial Accounting
Standards Board of the Financial Accounting
Foundation.
Startup Day: As defined in Section 2.07 hereof.
Stated Principal Balance: With respect to any Mortgage Loan or
related
REO Property (1) as of the Cut-off Date,
the Cut-off Date Principal Balance
thereof, and (2) as of any Distribution
Date, such Cut-off Date Principal
Balance, minus the sum of (A) the principal
portion of the Scheduled Payments
(x) due with respect to such Mortgage Loan
during each Due Period ending prior
to such Distribution Date and (y) that were
received by a Servicer as of the
close of business on the Determination Date
related to such Distribution Date or
with respect to which Advances were made on
the Servicer Advance Date prior to
such Distribution Date and (B) all
Principal Prepayments with respect to such
Mortgage Loan received on or prior to the
last day of the related Prepayment
Period, and all Liquidation Proceeds to the
extent applied by the related
Servicer as recoveries of principal in
accordance with Section 3.12 with respect
to such Mortgage Loan, that were received
by the related Servicer as of the
close of business on the last day of the
related Due Period. Notwithstanding the
foregoing, the Stated Principal Balance of
a Liquidated Loan shall be deemed to
be zero.
Stepdown Date: The later to occur of (1) the Distribution Date in
July
2008 or (2) the first Distribution Date on
which (A) the Class A Certificate
Principal Balance (reduced by the Principal
Funds with respect to such
Distribution Date) is less than or equal to
(B) 25.30% of the Stated Principal
Balances of the Mortgage Loans as of such
Distribution Date.
Subordinated Certificates: The Class M and Class B
Certificates.
Subsequent Recovery: Any amount received on a Mortgage Loan (net
of
amounts reimbursed to the related Servicer
related to Liquidated Mortgage Loans)
subsequent to such Mortgage Loan being
determined to be a Liquidated Mortgage
Loan.
Subservicing Agreement: As defined in Section 3.02(a).
Substitution Adjustment Amount: The meaning ascribed to such
term
pursuant to Section 2.03(c).
Tax Matters Person: The Person designated as "tax matters person"
in
the manner provided under Treasury
regulation Section 1.860F-4(d) and Treasury
regulation Section 301.6231(a)(7)-1.
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Transfer: Any direct or indirect transfer or sale of any
Ownership
Interest in a Certificate.
Transfer Agreement: Each document set out on Exhibit J-1 and
Exhibit
J-2 hereto pursuant to which the related
Seller acquired any Mortgage Loan from
the Transferor of such Mortgage Loan.
Transferor: Any originator of a Mortgage Loan.
Trigger Event: With respect to the Certificates on or after the
Stepdown Date, a Distribution Date on which
(1) the quotient of (A) the
aggregate Stated Principal Balance of all
Mortgage Loans which are 60 or more
days Delinquent measured on a rolling three
month basis (including, for the
purposes of this calculation, Mortgage
Loans in foreclosure and REO Properties)
and (B) the Stated Principal Balance of the
Mortgage Loans as of the last day of
the preceding calendar month, equals or
exceeds the product of (i) 16.00% and
(ii) Required Percentage or (2) the
quotient (expressed as a percentage) of (A)
the aggregate Realized Losses incurred from
the Cut-off Date through the last
day of the calendar month preceding such
Distribution Date and (B) the aggregate
principal balance of the Mortgage Loans as
of the Cut-off Date exceeds the
Required Loss Percentage.
Trust Fund: The corpus of the trust (the "Merrill Lynch
Mortgage
Investors Trust, Series 2005-SL2") created
hereunder consisting of (i) the
Mortgage Loans and all interest and
principal received on or with respect
thereto on and after the Cut-off Date to
the extent not applied in computing the
Cut-off Date Principal Balance thereof,
exclusive of interest not required to be
deposited in the Collection Account; (ii)
the Collection Account and the
Certificate Account and all amounts
deposited therein pursuant to the applicable
provisions of this Agreement; (iii)
property that secured a Mortgage Loan and
has been acquired by foreclosure, deed in
lieu of foreclosure or otherwise; (iv)
the mortgagee's rights under the Insurance
Policies with respect to the Mortgage
Loans; and (v) all proceeds of the
conversion, voluntary or involuntary, of any
of the foregoing into cash or other liquid
property.
Trustee: Deutsche Bank National Trust Company, a national
banking
association, not in its individual
capacity, but solely in its capacity as
trustee for the benefit of the
Certificateholders under this Agreement, and any
successor thereto, and any corporation or
national banking association resulting
from or surviving any consolidation or
merger to which it or its successors may
be a party and any successor trustee as may
from time to time be serving as
successor trustee hereunder.
Trustee Fee: The fee payable to the Trustee by the Securities
Administrator pursuant to a separate
agreement.
Uncertificated Class C Interest: An uncertificated interest having
(i)
the same rights to payments as the Class C
Certificates, and (ii) the rights to
the payments treated as distributed to the
Class C Certificates under Section
2.07(d), provided, however, that such
interest shall have no obligation to make
any payments treated as paid by the Class C
Certificates pursuant to interest
rate cap agreements under Section
2.07(d).
United States Person: (i) A citizen or resident of the United
States,
(ii) a corporation, partnership or other
entity treated as a corporation or
partnership for 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
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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 United States
Persons.
Unpaid Realized Loss Amount: The Class M-1 Unpaid Realized Loss
Amount,
Class M-2 Unpaid Realized Loss Amount,
Class B-1 Unpaid Realized Loss Amount,
Class B-2 Unpaid Realized Loss Amount,
Class B-3 Unpaid Realized Loss Amount,
Class B-4 Realized Loss Amount, Class B-5
Realized Loss Amount and Class C
Unpaid Realized Loss Amount,
collectively.
Upper Tier REMIC: As described in the Preliminary Statement and
Section
2.07.
USAP Report: A report in compliance with the Uniform Single
Attestation
Program for Mortgage Bankers delivered in
accordance with Section 3.18.
Voting Rights: The portion of the voting rights of all the
Certificates
that is allocated to any of the
Certificates for purposes of the voting
provisions hereunder. Voting Rights
allocated to each Class of Certificates
shall be allocated as follows: (1) 98% to
the Class A-1A, Class A-1B, Class M-1,
Class M-2, Class R, Class B-1, Class B-2,
Class B-3, Class B-4 and Class B-5
Certificates, with the allocation among
such Certificates to be in proportion to
the Class Certificate Principal Balance of
each Class relative to the Class
Certificate Principal Balance of all other
Classes and (2) each Class of the
Class C and Class P will be allocated 1% of
the Voting Rights Certificates.
Voting Rights will be allocated among the
Certificates of each such Class in
accordance with their respective Percentage
Interests.
Wilshire: Wilshire Credit Corporation, a Nevada corporation, or
its
successors in interest.
Wilshire Serviced Loans: Those Mortgage Loans identified on the
Mortgage Loan Schedule as being serviced by
Wilshire.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
SECTION 2.01. Conveyance of Mortgage Loans.
The Depositor, concurrently with the execution and delivery
hereof,
does hereby sell, transfer, assign, set
over and convey to the Trustee without
recourse all the right, title and interest
of the Depositor in and to the assets
of the Trust Fund. Such assignment includes
all interest and principal received
on or with respect to the Mortgage Loans on
or after the Cut-off Date (other
than Scheduled Payments due on the Mortgage
Loans on or before the Cut-off
Date).
It is agreed and understood by the Depositor, the Master Servicer,
the
Servicers, the Securities Administrator and
the Trustee that it is not intended
that any Mortgage Loan be included in the
Trust that is, without limitation,
either (i) a "High-Cost Home Loan" as
defined in the New Jersey Home Ownership
Act effective November 27, 2003; (ii) a
"High-Cost Home Loan" as defined in the
New Mexico Home Loan Protection Act
effective January 1, 2004; (iii) a
"High-Cost Home Mortgage Loan" as defined
in the Massachusetts Predatory Home
Loan Practices Act effective November 7,
2004; (iv) a "High-Cost Home Loan" as
defined by the Indiana High Cost Home Loan
Law effective January 1, 2005 or (v)
a "High-Cost Home Loan" as defined by the
Illinois High Risk Home Loan Act
effective January 1, 2004.
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The Master Servicer is hereby appointed as the initial Custodian.
The
Master Servicer in its capacity as
Custodian shall be entitled to all the
rights, benefits and protections afforded
the Master Servicer under this
Agreement, including without limitation its
rights pursuant to Section 6.03.
In connection with such assignment, the Depositor does hereby
deliver
to, and deposit with, the Custodian, the
following documents or instruments with
respect to each Mortgage Loan:
(A) The Original Mortgage Note endorsed in blank or, "Pay to
the order of Deutsche Bank National Trust Company, as trustee,
without
recourse" together with all riders thereto. The Mortgage Note
shall
include all intervening endorsements showing a complete chain of
the
title from the Transferor to [__________________].
(B) Except as provided below and for each Mortgage Loan that
is not a MERS Loan, the original recorded Mortgage together with
all
riders thereto, with evidence of recording thereon, or, if the
original
Mortgage has not yet been returned from the recording office, a
copy of
the original Mortgage together with all riders thereto certified to
be
a true copy of the original of the Mortgage that has been delivered
for
recording in the appropriate recording office of the jurisdiction
in
which the Mortgaged Property is located and in the case of each
MERS
Loan, the original Mortgage together with all riders thereto,
noting
the presence of the MIN of the Loan and either language indicating
that
the Mortgage Loan is a MOM Loan or if the Mortgage Loan was not a
MOM
Loan at origination, the original Mortgage and the assignment
thereof
to MERS, with evidence of recording indicated thereon, or a copy of
the
Mortgage certified by the public recording office in which such
Mortgage
has been recorded.
(C) In the case of each Mortgage Loan that is not a MERS Loan,
the original Assignment of each Mortgage in blank or, to "Deutsche
Bank
National Trust Company, as trustee."
(D) The
original policy of title insurance (or a preliminary
title report, commitment or binder if the original title
insurance
policy has not been received from the title insurance company).
(E) Originals of any intervening assignments of the Mortgage,
with evidence of recording thereon or, if the original
intervening
assignment has not yet been returned from the recording office, a
copy
of such assignment certified to be a true copy of the original of
the
assignment which has been sent for recording in the appropriate
jurisdiction in which the Mortgaged Property is located.
(F) Originals of all assumption and modification agreements,
if any.
(G) If in connection with any Mortgage Loan, the Depositor
cannot deliver the Mortgage, Assignments of Mortgage or
assumption,
consolidation or modification, as the case may be, with evidence
of
recording thereon, if applicable, concurrently with the execution
and
delivery of this Agreement solely because of a delay caused by
the
public recording office where such Mortgage, Assignments of
Mortgage or
assumption, consolidation or modification, as the case may be, has
been
delivered for recordation, the Depositor shall deliver or cause to
be
delivered to the Trustee written notice stating that such Mortgage
or
assumption, consolidation or modification, as the case may be, has
been
delivered to the appropriate public recording office for
recordation.
Thereafter, the Depositor shall deliver or cause to be delivered to
the
Trustee such Mortgage, Assignments of Mortgage or assumption,
consolidation or
modification, as the case may be, with evidence of
recording indicated thereon, if applicable, upon receipt thereof
from
the
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<PAGE>
public recording office. To the extent any required endorsement is
not
contained on a Mortgage Note or an Assignment of Mortgage, the
Depositor shall make or cause to be made such endorsement.
(H) With respect to any Mortgage Loan, none of the Depositor,
the Master Servicer, the Servicers, the Securities Administrator or
the
Trustee shall be obligated to cause to be recorded the Assignment
of
Mortgage referred to in this Section 2.01. In the event an
Assignment
of Mortgage is not recorded, the Master Servicer or the related
Servicer, as applicable, shall have no liability for its failure
to
receive and act on notices related to such Assignment of
Mortgage.
The ownership of each Mortgage Note, the Mortgage and the contents
of
the related Mortgage File is vested in the
Trustee on behalf of the
Certificateholders. None of the Depositor,
the Master Servicer, the Servicers or
the Securities Administrator shall take any
action inconsistent with such
ownership and shall not claim any ownership
interest therein. The Depositor, the
Master Servicer, the Servicers and the
Securities Administrator shall respond to
any third party inquiries with respect to
ownership of the Mortgage Loans by
stating that such ownership is held by the
Trustee on behalf of the
Certificateholders. Mortgage documents
relating to the Mortgage Loans not
delivered to the Custodian are and shall be
held in trust by the related
Servicer, for the benefit of the Trustee as
the owner thereof, and the related
Servicer's possession of the contents of
each Mortgage File so retained is for
the sole purpose of servicing the related
Mortgage Loan, and such retention and
possession by the related Servicer, is in a
custodial capacity only. The
Depositor agrees to take no action
inconsistent with the Trustee's ownership of
the Mortgage Loans, to promptly indicate to
all inquiring parties that the
Mortgage Loans have been sold and to claim
no ownership interest in the Mortgage
Loans.
It is the intention of this Agreement that the conveyance of
the
Depositor's right, title and interest in
and to the Trust Fund pursuant to this
Agreement shall constitute a purchase and
sale and not a loan. If a conveyance
of Mortgage Loans from a Seller to the
Depositor is characterized as a pledge
and not a sale, then the Depositor shall be
deemed to have transferred to the
Trustee all of the Depositor's right, title
and interest in, to and under the
obligations of such Seller deemed to be
secured by said pledge; and it is the
intention of this Agreement that the
Depositor shall also be deemed to have
granted to the Trustee a first priority
security interest in all of the
Depositor's right, title, and interest in,
to and under the obligations of each
Seller to the Depositor deemed to be
secured by said pledge and that the
Custodian shall be deemed to be an
independent custodian for purposes of
perfection of the security interest granted
to the Trustee. If the conveyance of
the Mortgage Loans from the Depositor to
the Trustee is characterized as a
pledge, it is the intention of this
Agreement that this Agreement shall
constitute a security agreement under
applicable law, and that the Depositor
shall be deemed to have granted to the
Trustee a first priority security
interest in all of the Depositor's right,
title and interest in, to and under
the Mortgage Loans, all payments of
principal of or interest on such Mortgage
Loans, all other rights relating to and
payments made in respect of the Trust
Fund, and all proceeds of any thereof. If
the trust created by this Agreement
terminates prior to the satisfaction of the
claims of any Person in any
Certificates, the security interest created
hereby shall continue in full force
and effect and the Trustee shall be deemed
to be the collateral agent for the
benefit of such Person.
In addition to the conveyance made in the first paragraph of
this
Section 2.01, the Depositor does hereby
convey, assign and set over to the
Trustee for the benefit of the
Certificateholders its rights and interests under
the Sale Agreements, including the
Depositor's right, title and interest in the
representations and warranties contained in
the Sale Agreements, the rights in
the Transfer Agreements described therein,
and the benefit of the repurchase
obligations and the obligation of the
Sellers contained in the Sale Agreements
to take, at the request of the Depositor or
the Trustee, all action on its part
which is reasonably necessary to ensure the
enforceability of a Mortgage Loan.
The Trustee hereby accepts
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<PAGE>
such assignment, and shall be entitled to
exercise all rights of the Depositor
under the Sale Agreements as if, for such
purpose, it were the Depositor. The
foregoing sale, transfer, assignment,
set-over, deposit and conveyance does not
and is not intended to result in creation
or assumption by the Trustee of any
obligation of the Depositor, the Sellers,
or any other Person in connection with
the Mortgage Loans or any other agreement
or instrument relating thereto.
SECTION 2.02. Acceptance by the Trustee of the Mortgage Loans.
Except as set forth in the exception report delivered
contemporaneously
herewith (the "Exception Report"), the
Custodian acknowledges receipt of the
Mortgage Note for each Mortgage Loan and
delivery of a Mortgage File (but does
not acknowledge receipt of all documents
required to be included in such
Mortgage File) with respect to each
Mortgage Loan and declares that it holds and
will hold such documents and any other
documents constituting a part of the
Mortgage Files delivered to it in trust for
the use and benefit of all present
and future Certificateholders. The
Depositor will cause the related Seller to
repurchase any Mortgage Loan to which a
material exception was taken in the
Exception Report unless such exception is
cured to the satisfaction of the
Trustee within 45 Business Days of the
Closing Date.
The Custodian agrees, for the benefit of Certificateholders, to
review
each Mortgage File delivered to it within
60 days after the Closing Date to
ascertain and to certify, within 70 days of
the Closing Date, to the Depositor,
the Master Servicer, the Trustee and the
related Servicer that all documents
required by Section 2.01 (A)-(B), (C) (if
applicable), and (D)-(E), and the
documents if actually received by it, under
Section 2.01(F), have been executed
and received, and that such documents
relate to the Mortgage Loans identified in
Exhibit B that have been conveyed to it.
The Custodian shall have no obligation
to verify whether the documents under
Section 2.01(F) exist. If the Custodian
finds any document or documents
constituting a part of a Mortgage File to be
missing or defective (that is, mutilated,
damaged, defaced or unexecuted) in any
material respect, the Custodian shall
promptly (and in any event within no more
than five Business Days) after such finding
so notify the Trustee, the Master
Servicer, the related Servicer, the related
Seller and the Depositor. In
addition, the Custodian shall also notify
the Trustee, the Master Servicer, the
related Servicer, the related Seller and
the Depositor if the original Mortgage
with evidence of recording thereon with
respect to a Mortgage Loan is not
received within 70 days of the Closing
Date; if it has not been received because
of a delay caused by the public recording
office where such Mortgage has been
delivered for recordation, the Depositor
shall deliver or cause to be delivered
to the Custodian and the Trustee written
notice stating that such Mortgage has
been delivered to the appropriate public
recording office for recordation and
thereafter the Depositor shall deliver or
cause to be delivered such Mortgage
with evidence of recording thereon upon
receipt thereof from the public
recording office. The Trustee shall request
that the related Seller correct or
cure such omission, defect or other
irregularity, or substitute a Mortgage Loan
pursuant to the provisions of Section
2.03(c), within 90 days from the date the
related Seller was notified of such
omission or defect and, if the related
Seller does not correct or cure such
omission or defect within such period, that
the related Seller purchase such Mortgage
Loan from the Trust Fund within 90
days from the date the Trustee notified the
related Seller of such omission,
defect or other irregularity at the
Purchase Price of such Mortgage Loan. The
Purchase Price for any Mortgage Loan
purchased pursuant to this Section 2.02
shall be paid to the related Servicer and
deposited by such Servicer in the
Certificate Account or Collection Account,
as appropriate, promptly upon
receipt, and the Custodian, upon receipt of
a Request for Release, shall
promptly release to the related Seller the
related Mortgage File and the Trustee
shall execute and deliver such instruments
of transfer or assignment, without
recourse, as shall be requested by the
related Seller and necessary to vest in
the related Seller or its designee, as the
case may be, any Mortgage Loan
released pursuant hereto, and the Trustee
and the Custodian shall have no
further responsibility with regard to such
Mortgage Loan. It is understood and
agreed that the obligation of the related
Seller to purchase, cure or substitute
any Mortgage Loan as to which a material
defect in or omission of a constituent
document exists shall constitute the sole
remedy respecting such defect or
omission available to the Trustee on
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behalf of Certificateholders. The preceding
sentence shall not, however, limit
any remedies available to the
Certificateholders, the Depositor or the Trustee
pursuant to the Sale Agreement, Transfer
Agreement or any Bring Down Letter. The
Trustee and the Custodian shall be under no
duty or obligation to inspect,
review and examine such documents,
instruments, certificates or other papers to
determine that they are genuine,
enforceable, recordable, duly authorized,
sufficient, legal, valid or appropriate to
the represented purpose, or that they
have actually been recorded, or that they
are other than what they purport to be
on their face. The Servicers, the Master
Servicer, the Securities Administrator,
the Custodian and the Trustee shall keep
confidential the name of each Mortgagor
except as required for performance of this
Agreement and the Servicers, the
Master Servicer, the Securities
Administrator, the Custodian and the Trustee
shall not solicit any such Mortgagor for
the purpose of refinancing the related
Mortgage Loan; notwithstanding anything
herein to the contrary, the foregoing
shall not be construed to prohibit (i)
disclosure of any and all information
that is or becomes publicly known, or
information obtained by the Trustee, a
Servicer, the Master Servicer, the
Securities Administrator or the Custodian
from sources other than the other parties
hereto, (ii) disclosure of any and all
information (A) if required to do so by any
applicable law, rule or regulation,
(B) to any government agency or regulatory
body having or claiming authority to
regulate or oversee any aspects of the
business of the Trustee, a Servicer, the
Master Servicer, the Securities
Administrator or the Custodian or that of any
Affiliate, (C) pursuant to any subpoena,
civil investigation demand or similar
demand or request of any court, regulatory
authority, arbitrator or arbitration
to which the Trustee, a Servicer, the
Master Servicer, the Securities
Administrator or the Custodian or any
Affiliate or an officer, director,
employer or shareholder thereof is a party
or (D) to any Affiliate, independent
or internal auditor, agent, employee or
attorney of the Trustee, a Servicer, the
Master Servicer, the Securities
Administrator or the Custodian having a need to
know the same, provided that the Trustee,
such Servicer, the Master Servicer,
the Securities Administrator or the
Custodian, as applicable, advises such
recipient of the confidential nature of the
information being disclosed, or
(iii) any other disclosure authorized by
the Depositor.
Within 70 days of the Closing Date, the Custodian shall deliver to
the
Depositor, the Master Servicer, the Trustee
and the Servicers the Custodian
Certification, substantially in the form of
Exhibit D attached hereto,
evidencing the completeness of the Mortgage
Files, with any exceptions noted
thereto.
SECTION 2.03. Representations, Warranties and Covenants of the
Depositor.
(a) The Depositor hereby represents and warrants to the
Servicers, the Master Servicer, the
Securities Administrator and the Trustee as
follows, as of the date hereof:
(i) The Depositor is duly organized and is validly existing as
a corporation in good standing under the laws of the State of
Delaware
and has full power and authority (corporate and other) necessary to
own
or hold its properties and to conduct its business as now conducted
by
it and to enter into and perform its obligations under this
Agreement
and the Sale Agreements.
(ii) The Depositor has the full corporate power and authority
to execute, deliver and perform, and to enter into and consummate
the
transactions contemplated by, this Agreement and the Sale
Agreements
and has duly authorized, by all necessary corporate action on its
part,
the execution, delivery and performance of this Agreement and the
Sale
Agreements; and this Agreement and the Sale Agreements, assuming
the
due authorization, execution and delivery hereof by the other
parties
hereto, constitutes a legal, valid and binding obligation of
the
Depositor, enforceable against the Depositor in accordance with
its
terms, subject, as to enforceability, to (i) bankruptcy,
insolvency,
reorganization, moratorium and other similar laws affecting
creditors'
rights generally and (ii) general principles of equity, regardless
of
whether enforcement is sought in a proceeding in equity or at
law.
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<PAGE>
(iii) The execution and delivery of this Agreement and the
Sale Agreements by the Depositor, the consummation of the
transactions
contemplated by this Agreement and the Sale Agreements, and the
fulfillment of or compliance with the terms hereof are in the
ordinary
course of business of the Depositor and will not (A) result in
a
material breach of any term or provision of the charter or by-laws
of
the Depositor or (B) materially conflict with, result in a
violation or
acceleration of, or result in a material default under, the terms
of
any other material agreement or instrument to which the Depositor
is a
party or by which it may be bound or (C) constitute a material
violation of any statute, order or regulation applicable to the
Depositor of any court, regulatory body, administrative agency
or
governmental body having jurisdiction over the Depositor; and
the
Depositor is not in breach or violation of any material indenture
or
other material agreement or instrument, or in violation of any
statute,
order or regulation of any court, regulatory body,
administrative
agency or governmental body having jurisdiction over it which
breach or
violation may materially impair the Depositor's ability to perform
or
meet any of its obligations under this Agreement.
(iv) No litigation is pending, or, to the best of the
Depositor's knowledge, threatened, against the Depositor that
would
materially and adversely affect the execution, delivery or
enforceability of this Agreement and the Sale Agreements or the
ability
of the Depositor to perform its obligations under this Agreement
and
the Sale Agreements in accordance with the terms hereof.
(v) No consent, approval, authorization or order of any court
or governmental agency or body is required for the execution,
delivery
and performance by the Depositor of, or compliance by the
Depositor
with, this Agreement and the Sale Agreements or the consummation of
the
transactions contemplated hereby, or if any such consent,
approval,
authorization or order is required, the Depositor has obtained
the
same. The Depositor hereby represents and warrants to the Trustee
with
respect to each Mortgage Loan as of the Closing Date, and following
the
transfer of the Mortgage Loans to it by the related Seller, the
Depositor had good title to the Mortgage Loans and the Mortgage
Notes
were subject to no offsets, claims, liens, mortgage, pledge,
charge,
security interest, defenses or counterclaims.
(b) The representations and warranties of each Transferor with
respect to the related Mortgage Loans in
the applicable Transfer Agreement,
which have been assigned to the Trustee
hereunder, were made as of the date
specified in the applicable Transfer
Agreement and brought forward to the
Closing Date pursuant to the related Bring
Down Letter, except as otherwise
noted on Exhibit J-1 or Exhibit J-2. The
representations and warranties of each
Transferor with respect to the Mortgage
Loans contained in the Bring Down Letter
were made as of the Closing Date, except as
otherwise noted on Exhibit J-1 or
Exhibit J-2. The representations and
warranties of the related Seller with
respect to the Mortgage Loans contained in
the related Sale Agreement were made
as of the Closing Date. To the extent that
any fact, condition or event with
respect to a Mortgage Loan constitutes a
breach of both (i) a representation or
warranty of the applicable Transferor under
the applicable Transfer Agreement
and (ii) a representation or warranty of
the related Seller under the related
Sale Agreement, the obligations of the
related Seller under the related Sale
Agreement shall be enforced against the
Transferor or such Seller, as
applicable, as set forth in such Sale
Agreement. The Trustee acknowledges that
the related Seller shall have no obligation
or liability with respect to any
breach of a representation or warranty made
by it with respect to any related
Mortgage Loans, except as otherwise set
forth in the related Sale Agreement, if
the fact, condition or event constituting
such breach also constitutes a breach
of a representation or warranty made by the
related Transferor in the related
Transfer Agreement, without regard to
whether the related Transferor fulfills
its contractual obligations in respect of
such representation or warranty. The
Trustee also acknowledges that the related
Seller shall have no obligation or
liability with respect to any breach of a
representation or warranty made solely
by the Transferors with respect to the
Mortgage
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<PAGE>
Loans, without regard to whether the
related Transferor fulfills its contractual
obligations in respect of such
representation or warranty. The Trustee further
acknowledges that the Depositor shall have
no obligation or liability with
respect to any breach of any representation
or warranty with respect to the
Mortgage Loans (except as set forth in
Section 2.03(a)(v)) under any
circumstances.
In addition to the representations and warranties of the
Transferors in
the Transfer Agreements that were brought
forward to the Closing Date pursuant
to the Bring Down Letter, with respect to
each Mortgage Loan, each Transferor
made certain additional covenants regarding
such Mortgage Loan, as set forth in
the related Transfer Agreement. With
respect to any breach of such additional
covenants that materially and adversely
affects the interests of the
Certificateholders in such Mortgage Loan,
the related Seller shall (1) use
reasonable efforts to enforce such covenant
against the related Transferor and
(2) if the related Seller successfully
enforces any obligation of the related
Transferor to repurchase such Mortgage
Loan, the related Seller shall repurchase
such Mortgage Loan in accordance with this
Section 2.03. If the related Seller
does not successfully enforce the
obligation, if any, of the Transferor to
repurchase a Mortgage Loan with respect to
any breach of any such additional
covenants, the related Seller shall have no
obligation or right to repurchase or
cure such Mortgage Loan.
(c) Upon discovery by any of the Depositor, the Master
Servicer, the Securities Administrator, a
Servicer or the Trustee of a breach of
any of such representations and warranties
that adversely and materially affects
the value of the related Mortgage Loan,
Prepayment Charges or the interests of
the Certificateholders, the party
discovering such breach shall give prompt
written notice to the other parties. Within
90 days of the discovery of such
breach of any representation or warranty,
the applicable Transferor or the
related Seller, as applicable, shall either
(a) cure such breach in all material
respects, (b) repurchase such Mortgage Loan
or any property acquired in respect
thereof from the Trustee at the Purchase
Price or (c) within the two year period
following the Closing Date, substitute a
Replacement Mortgage Loan for the
affected Mortgage Loan. In the event of
discovery of a breach of any
representation and warranty of any
Transferor or the related Seller, the
Trustee's rights shall be enforced under
the applicable Transfer Agreement and
the related Sale Agreement for the benefit
of Certificateholders. If a breach of
the representations and warranties set
forth in the Transfer Agreement hereof
exists solely due to the unenforceability
of a Prepayment Charge, the Trustee or
the other party having notice thereof shall
notify the related Servicer thereof
and not seek to enforce the repurchase
remedy provided for herein unless such
Mortgage Loan is not current. In the event
of a breach of the representations
and warranties with respect to the Mortgage
Loans set forth in a Transfer
Agreement, the Trustee shall enforce the
right of the Trust Fund to be
indemnified for such breach of
representation and warranty. In the event that
such breach relates solely to the
unenforceability of a Prepayment Charge,
amounts received in respect of such
indemnity up to the amount of such
Prepayment Charge shall be distributed
pursuant to Section 4.04(b)(i). As
provided in each Sale Agreement, if a
Seller substitutes for a Mortgage Loan for
which there is a breach of any
representations and warranties in the related
Transfer Agreement which adversely and
materially affects the value of such
Mortgage Loan and such substitute mortgage
loan is not a Replacement Mortgage
Loan, under the terms of each Sale
Agreement, the applicable Seller will, in
exchange for such substitute Mortgage Loan,
(i) provide the applicable Purchase
Price for the affected Mortgage Loan or
(ii) within two years of the Closing
Date, substitute such affected Mortgage
Loan with a Replacement Mortgage Loan.
Any such substitution shall not be effected
prior to the additional delivery to
the Custodian of a Request for Release
substantially in the form of Exhibit I
and shall not be effected unless it is
within two years of the Startup Day. Each
Seller indemnifies and holds the Trust
Fund, the Trustee, the Depositor, the
Master Servicer, the Securities
Administrator, the Servicers and each
Certificateholder harmless against any and
all taxes, claims, losses, penalties,
fines, forfeitures, reasonable legal fees
and related costs, judgments, and any
other costs, fees and expenses that the
Trust Fund, the Trustee, the Depositor,
the Master Servicer, the Securities
Administrator, the Servicers and any
Certificateholder may sustain in connection
with any actions of such Seller
relating to a repurchase of a Mortgage Loan
other than in compliance with the
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<PAGE>
terms of this Section 2.03 and the related
Sale Agreement, to the extent that
any such action causes (i) any federal or
state tax to be imposed on the Trust
Fund or any REMIC provided for herein,
including without limitation, any federal
tax imposed on "prohibited transactions"
under Section 860F(a)(1) of the Code or
on "contributions after the startup day"
under Section 860G(d)(1) of the Code,
or (ii) any REMIC created hereunder to fail
to qualify as a REMIC at any time
that any Certificate is outstanding. In
furtherance of the foregoing, if the
Transferor or a Seller, as applicable, is
not a member of MERS and repurchases a
Mortgage Loan which is registered on the
MERS System, the Transferor or the
related Seller, as applicable, at its own
expense and without any right of
reimbursement, shall cause MERS to execute
and deliver an assignment of the
Mortgage in recordable form to transfer the
Mortgage from MERS to the Transferor
or the related Seller, as applicable, and
shall cause such Mortgage to be
removed from registration on the MERS
System in accordance with MERS' rules and
regulations.
With respect to any Mortgage Loan repurchased by a Seller pursuant
to
the related Sale Agreement or by any
Transferor pursuant to the applicable
Transfer Agreement, the principal portion
of the funds received by the
Securities Administrator in respect of such
repurchase of a Mortgage Loan will
be considered a Principal Prepayment and
shall be deposited in the Certificate
Account pursuant to Section 3.05. Upon
receipt by the Custodian of notice from
the Securities Administrator of receipt by
the Securities Administrator of the
full amount of the Purchase Price for a
Deleted Mortgage Loan, and upon receipt
by the Custodian of the Mortgage File for a
Replacement Mortgage Loan
substituted for a Deleted Mortgage Loan,
the Custodian shall release and the
Trustee shall reassign to the related
Seller or the applicable Transferor, as
applicable, the related Mortgage File for
the Deleted Mortgage Loan and the
Trustee shall execute and deliver such
instruments of transfer or assignment, in
each case without recourse, representation
or warranty, as shall be necessary to
vest in such party or its designee or
assignee title to any Deleted Mortgage
Loan released pursuant hereto, free and
clear of all security interests, liens
and other encumbrances created by this
Agreement, which instruments shall be
prepared by the Depositor, the related
Seller or the related Transferor, and the
Trustee, the Securities Administrator and
the Custodian shall have no further
responsibility with respect to the Mortgage
File relating to such Deleted
Mortgage Loan.
With respect to each Replacement Mortgage Loan to be delivered to
the
Custodian pursuant to the terms of this
Article II in exchange for a Deleted
Mortgage Loan: (i) the applicable
Transferor or the related Seller, as
applicable, must deliver to the Custodian
the Mortgage File for the Replacement
Mortgage Loan containing the documents set
forth in Section 2.01 along with a
written certification certifying as to the
Mortgage Loan satisfying all
requirements under the definition of
Replacement Mortgage Loan and the delivery
of such Mortgage File and containing the
granting language set forth in Section
2.01; and (ii) the Depositor will be deemed
to have made, with respect to such
Replacement Mortgage Loan, each of the
representations and warranties made by it
with respect to the related Deleted
Mortgage Loan. The Custodian shall review
the Mortgage File with respect to each
Replacement Mortgage Loan and certify to
the Depositor that all documents required
by Section 2.01(A)-(B), (C) (if
applicable), and (D)-(E) have been executed
and received.
For any month in which a Seller substitutes one or more
Replacement
Mortgage Loans for one or more Deleted
Mortgage Loans, such Seller will
determine the amount (if any) by which the
aggregate principal balance of all
such Replacement Mortgage Loans as of the
date of substitution and the aggregate
Prepayment Charges with respect to such
Replacement Mortgage Loans is less than
the aggregate Stated Principal Balance
(after application of the principal
portion of the Scheduled Payment due in the
month of substitution) and aggregate
Prepayment Charges of all such Deleted
Mortgage Loans. An amount equal to the
aggregate of the deficiencies described in
the preceding sentence (such amount,
the "Substitution Adjustment Amount") plus
an amount equal to any unreimbursed
costs, penalties and/or damages incurred by
the Trust Fund in connection with
any violation relating to such Deleted
Mortgage Loan of any predatory or abusive
lending law shall be remitted by such
Seller to the Securities Administrator for
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deposit into the Certificate Account by
such Seller on the Determination Date
for the Distribution Date relating to the
Prepayment Period during which the
related Mortgage Loan became required to be
purchased or replaced hereunder.
Notwithstanding any other provision of this Agreement, the right
to
substitute Mortgage Loans pursuant to this
Article II shall be subject to the
additional limitations that no substitution
of a Replacement Mortgage Loan for a
Deleted Mortgage Loan shall be made unless
the Trustee and the Securities
Administrator shall have received an
Opinion of Counsel (at the expense of the
party seeking to make the substitution)
that, under current law, such
substitution will not (A) affect adversely
the status of any REMIC established
hereunder as a REMIC, or of the related
"regular interests" as "regular
interests" in any such REMIC, or (B) cause
any such REMIC to engage in a
"prohibited transaction" or prohibited
contribution pursuant to the REMIC
Provisions.
The Depositor shall amend the Mortgage Loan Schedule to reflect
the
removal of such Deleted Mortgage Loan from
the terms of this Agreement and the
substitution of the Replacement Mortgage
Loan or Replacement Mortgage Loans.
Upon such substitution by a Seller, such
Replacement Mortgage Loan or
Replacement Mortgage Loans shall constitute
part of the Mortgage Pool and shall
be subject in all respects to the terms of
this Agreement and the applicable
Sale Agreement, including all applicable
representations and warranties thereof
included in the applicable Sale Agreement
as of the date of substitution.
(d) It is understood and agreed that the representations,
warranties and indemnification (i) set
forth in this Section 2.03, (ii) of the
related Seller and the Depositor set forth
in the related Sale Agreement and
assigned to the Trustee by the Depositor
hereunder and (iii) of each Transferor,
assigned by the related Seller to the
Depositor pursuant to the related Sale
Agreement and assigned to the Trustee by
the Depositor hereunder shall each
survive delivery of the Mortgage Files and
the Assignment of Mortgage of each
Mortgage Loan to the Trustee and shall
continue throughout the term of this
Agreement.
(e) The Depositor shall deliver a copy of the Mortgage Loan
Schedule to the Servicer on the Closing
Date.
SECTION 2.04. Representations and Warranties of the Master
Servicer;
Representations and Warranties of the
Servicers; Representations and Warranties
of the Securities Administrator.
(a) The Master Servicer hereby represents and warrants to the
Depositor, the Servicers and the Trustee as
follows, as of the date hereof:
(i) The Master Servicer is duly organized and is
validly existing as a national banking
association and is duly authorized and
qualified to transact any and all business
contemplated by this Agreement to be
conducted by the Master Servicer.
(ii) The Master Servicer has the power and authority
to master service each Mortgage Loan, and
to execute, deliver and perform, and
to enter into and consummate, the
transactions contemplated by this Agreement
and has duly authorized by all necessary
action on the part of the Master
Servicer the execution, delivery and
performance of this Agreement; and this
Agreement, assuming the due authorization,
execution and delivery hereof by the
other parties hereto, constitutes a legal,
valid and binding obligation of the
Master Servicer, enforceable against the
Master Servicer in accordance with its
terms, except that (A) the enforceability
hereof may be limited by bankruptcy,
insolvency, moratorium, receivership and
other similar laws relating to
creditors' rights generally and (B) the
remedy of specific
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performance and injunctive and other forms
of equitable relief may be subject to
equitable defenses and to the discretion of
the court before which any
proceeding hereunder may be brought.
(iii) The execution and delivery of this Agreement by
the Master Servicer, the master servicing
of the Mortgage Loans under this
Agreement, the consummation of any other of
the transactions contemplated by
this Agreement, and the fulfillment of or
compliance with the terms hereof are
in the ordinary course of business of the
Master Servicer and will not (A)
result in a material breach of any term or
provision of the charter or by-laws
of the Master Servicer or (B) materially
conflict with, result in a material
breach, violation or acceleration of, or
result in a material default under, the
terms of any other material agreement or
instrument to which the Master Servicer
is a party or by which it may be bound, or
(C) constitute a material violation
of any statute, order or regulation
applicable to the Master Servicer of any
court, regulatory body, administrative
agency or governmental body having
jurisdiction over the Master Servicer; and
the Master Servicer is not in breach
or violation of any material indenture or
other material agreement or
instrument, or in violation of any statute,
order or regulation of any court,
regulatory body, administrative agency or
governmental body having jurisdiction
over it which breach or violation may
materially impair the Master Servicer's
ability to perform or meet any of its
obligations under this Agreement.
(iv) The Master Servicer, or an Affiliate thereof, is
an approved servicer of mortgage loans for
Fannie Mae and for Freddie Mac.
(v) No litigation is pending or, to the best of the
Master Servicer's knowledge, threatened,
against the Master Servicer that would
materially and adversely affect the
execution, delivery or enforceability of
this Agreement or its performance of any of
its other obligations under this
Agreement in accordance with the terms
hereof.
(vi) No consent, approval, authorization or order of
any court or governmental agency or body is
required for the execution, delivery
and performance by the Master Servicer of,
or compliance by the Master Servicer
with, this Agreement or the consummation of
the transactions contemplated
hereby, or if any such consent, approval,
authorization or order is required,
the Master Servicer has obtained the same,
except for approvals, authorizations
or orders that may be required for
performance with regard to individual
Mortgage Loans.
(b) Wilshire hereby represents and warrants to the Depositor,
the Master Servicer, the Securities
Administrator and the Trustee as follows, as
of the date hereof:
(i) Wilshire is duly organized and is validly
existing as a corporation in good standing
under the laws of the State of Nevada
and is duly authorized and qualified to
transact any and all business
contemplated by this Agreement to be
conducted by Wilshire in any state in which
a Mortgaged Property is located or is
otherwise not required under applicable
law to effect such qualification and, in
any event, is in compliance with the
doing business laws of any such state, to
the extent necessary to ensure its
ability to enforce each Mortgage Loan, to
service the Mortgage Loans in
accordance with the terms of this Agreement
and to perform any of its other
obligations under this Agreement in
accordance with the terms hereof.
(ii) Wilshire has the corporate power and authority
and to service each Mortgage Loan, and to
execute, deliver and perform, and to
enter into and consummate the transactions
contemplated by this Agreement and
has duly authorized by all necessary
corporate action on the part of Wilshire
the execution, delivery and performance of
this Agreement; and this Agreement,
assuming the due authorization, execution
and delivery hereof by the other
parties hereto, constitutes a legal, valid
and binding obligation of Wilshire,
enforceable against Wilshire in accordance
with its terms, except that (a)
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the enforceability hereof may be limited by
bankruptcy, insolvency, moratorium,
receivership and other similar laws
relating to creditors' rights generally and
(b) the remedy of specific performance and
injunctive and other forms of
equitable relief may be subject to
equitable defenses and to the discretion of
the court before which any proceeding
therefor may be brought.
(iii) The execution and delivery of this Agreement by
Wilshire, the servicing of the Mortgage
Loans under this Agreement, the
consummation of any other of the
transactions contemplated by this Agreement,
and the fulfillment of or compliance with
the terms hereof are in the ordinary
course of business of Wilshire and will not
(A) result in a material breach of
any term or provision of the charter or
by-laws of Wilshire or (B) materially
conflict with, result in a material breach,
violation or acceleration of, or
result in a material default under, the
terms of any other material agreement or
instrument to which Wilshire is a party or
by which it may be bound, or (C)
constitute a material violation of any
statute, order or regulation applicable
to Wilshire of any court, regulatory body,
administrative agency or governmental
body having jurisdiction over Wilshire; and
Wilshire is not in breach or
violation of any material indenture or
other material agreement or instrument,
or in violation of any statute, order or
regulation of any court, regulatory
body, administrative agency or governmental
body having jurisdiction over it
which breach or violation may materially
impair Wilshire's ability to perform or
meet any of its obligations under this
Agreement.
(iv) Wilshire is an approved servicer of mortgage
loans for Fannie Mae and is an approved
servicer of mortgage loans for Freddie
Mac.
(v) No litigation is pending or, to the best of
Wilshire's knowledge, threatened, against
Wilshire that would materially and
adversely affect the execution, delivery or
enforceability of this Agreement or
the ability of Wilshire to service the
Mortgage Loans or to perform any of its
other obligations under this Agreement in
accordance with the terms hereof.
(vi) No consent, approval, authorization or order of
any court or governmental agency or body is
required for the execution, delivery
and performance by Wilshire of, or
compliance by Wilshire with, this Agreement
or the consummation of the transactions
contemplated hereby, or if any such
consent, approval, authorization or order
is required, Wilshire has obtained the
same.
(vii) Wilshire has fully furnished and will fully
furnish (for the period it serviced the
Mortgage Loans), in accordance with the
Fair Credit Reporting Act and its
implementing regulations, accurate and
complete information (e.g., favorable and
unfavorable) on its borrower credit
files to Equifax, Experian and Trans Union
Credit Information Company on a
monthly basis.
(c) PHH hereby represents and warrants to the Depositor, the
Master Servicer, the Securities
Administrator and the Trustee as follows, as of
the date hereof:
(i) PHH is duly organized and is validly existing as
a corporation in good standing under the
laws of the State of New Jersey and is
duly authorized and qualified to transact
any and all business contemplated by
this Agreement to be conducted by PHH in
any state in which a Mortgaged Property
is located or is otherwise not required
under applicable law to effect such
qualification and, in any event, is in
compliance with the doing business laws
of any such state, to the extent necessary
to ensure its ability to enforce each
Mortgage Loan, to service the Mortgage
Loans in accordance with the terms of
this Agreement and to perform any of its
other obligations under this Agreement
in accordance with the terms hereof.
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(ii) PHH has the corporate power and authority and to
service each Mortgage Loan, and to execute,
deliver and perform, and to enter
into and consummate the transactions
contemplated by this Agreement and has duly
authorized by all necessary corporate
action on the part of PHH the execution,
delivery and performance of this Agreement;
and this Agreement, assuming the due
authorization, execution and delivery
hereof by the other parties hereto,
constitutes a legal, valid and binding
obligation of PHH, enforceable against
PHH in accordance with its terms, except
that (a) the enforceability hereof may
be limited by bankruptcy, insolvency,
moratorium, receivership and other similar
laws relating to creditors' rights
generally and (b) the remedy of specific
performance and injunctive and other forms
of equitable relief may be subject to
equitable defenses and to the discretion of
the court before which any
proceeding therefor may be brought.
(iii) The execution and delivery of this Agreement by
PHH, the servicing of the Mortgage Loans
under this Agreement, the consummation
of any other of the transactions
contemplated by this Agreement, and the
fulfillment of or compliance with the terms
hereof are in the ordinary course of
business of PHH and will not (A) result in
a material breach of any term or
provision of the charter or by-laws of PHH
or (B) materially conflict with,
result in a material breach, violation or
acceleration of, or result in a
material default under, the terms of any
other material agreement or instrument
to which PHH is a party or by which it may
be bound, or (C) constitute a
material violation of any statute, order or
regulation applicable to PHH of any
court, regulatory body, administrative
agency or governmental body having
jurisdiction over PHH; and PHH is not in
breach or violation of any material
indenture or other material agreement or
instrument, or in violation of any
statute, order or regulation of any court,
regulatory body, administrative
agency or governmental body having
jurisdiction over it which breach or
violation may materially impair PHH's
ability to perform or meet any of its
obligations under this Agreement.
(iv) PHH is an approved servicer of mortgage loans
for Fannie Mae and is an approved servicer
of mortgage loans for Freddie Mac.
(v) No litigation is pending or, to the best of PHH's
knowledge, threatened, against PHH that
would materially and adversely affect
the execution, delivery or enforceability
of this Agreement or the ability of
PHH to service the Mortgage Loans or to
perform any of its other obligations
under this Agreement in accordance with the
terms hereof.
(vi) No consent, approval, authorization or order of
any court or governmental agency or body is
required for the execution, delivery
and performance by PHH of, or compliance by
PHH with, this Agreement or the
consummation of the transactions
contemplated hereby, or if any such consent,
approval, authorization or order is
required, PHH has obtained the same.
(vii) PHH has fully furnished and will fully furnish
(for the period it serviced the Mortgage
Loans), in accordance with the Fair
Credit Reporting Act and its implementing
regulations, accurate and complete
information (e.g., favorable and
unfavorable) on its borrower credit files to
Equifax, Experian and Trans Union Credit
Information Company on a monthly basis.
(d) The Securities Administrator hereby represents and
warrants to the Depositor, the Master
Servicer, the Servicers and the Trustee as
of the date hereof:
(i) The Securities Administrator is duly organized
and is validly existing as a national
banking association and is duly authorized
and qualified to transact any and all
business contemplated by this Agreement to
be conducted by the Securities
Administrator.
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(ii) The Securities Administrator has the full
corporate power and authority to execute,
deliver and perform, and to enter into
and consummate, the transactions
contemplated by this Agreement and has duly
authorized by all necessary corporate
action on the part of the Securities
Administrator the execution, delivery and
performance of this Agreement; and
this Agreement, assuming the due
authorization, execution and delivery hereof by
the other parties hereto, constitutes a
legal, valid and binding obligation of
the Securities Administrator, enforceable
against the Securities Administrator
in accordance with its terms, except that
(a) the enforceability hereof may be
limited by bankruptcy, insolvency,
moratorium, receivership and other similar
laws relating to creditors' rights
generally and (b) the remedy of specific
performance and injunctive and other forms
of equitable relief may be subject to
equitable defenses and to the discretion of
the court before which any
proceeding hereunder may be brought.
(iii) The execution and delivery of this Agreement by
the Securities Administrator, the
consummation of any other of the transactions
contemplated by this Agreement, and the
fulfillment of or compliance with the
terms hereof are in the ordinary course of
business of the Securities
Administrator and will not (A) result in a
material breach of any term or
provision of the charter or by-laws of the
Securities Administrator or (B)
materially conflict with, result in a
material breach, violation or acceleration
of, or result in a material default under,
the terms of any other material
agreement or instrument to which the
Securities Administrator is a party or by
which it may be bound, or (C) constitute a
material violation of any statute,
order or regulation applicable to the
Securities Administrator of any court,
regulatory body, administrative agency or
governmental body having jurisdiction
over the Securities Administrator; and the
Securities Administrator is not in
breach or violation of any material
indenture or other material agreement or
instrument, or in violation of any statute,
order or regulation of any court,
regulatory body, administrative agency or
governmental body having jurisdiction
over it which breach or violation may
materially impair the Securities
Administrator's ability to perform or meet
any of its obligations under this
Agreement.
(iv) No litigation is pending or, to the best of the
Securities Administrator's knowledge,
threatened, against the Securities
Administrator that would materially and
adversely affect the execution, delivery
or enforceability of this Agreement or the
ability of the Securities
Administrator to perform any of its other
obligations under this Agreement in
accordance with the terms hereof.
(v) No consent, approval, authorization or order of
any court or governmental agency or body is
required for the execution, delivery
and performance by the Securities
Administrator of, or compliance by the
Securities Administrator with, this
Agreement or the consummation of the
transactions contemplated hereby, or if any
such consent, approval,
authorization or order is required, the
Securities Administrator has obtained
the same.
SECTION 2.05. Substitutions and Repurchases of Mortgage Loans which
are
not "Qualified Mortgages".
Upon discovery by the Depositor, the Master Servicer, a Servicer,
the
Securities Administrator or the Trustee
that any Mortgage Loan does not
constitute a "qualified mortgage" within
the meaning of section 860G(a)(3) of
the Code, the party discovering such fact
shall promptly (and in any event
within 5 Business Days of discovery) give
written notice thereof to the other
parties. In connection therewith, the
Depositor shall, at the Depositor's
option, either (i) substitute, if the
conditions in Section 2.03(c) with respect
to substitutions are satisfied, a
Replacement Mortgage Loan for the affected
Mortgage Loan, or (ii) repurchase the
affected Mortgage Loan within 90 days of
such discovery in the same manner as it
would a Mortgage Loan for a breach of
representation or warranty contained in
Section 2.03. The Trustee, upon the
written direction of the Depositor, shall
reconvey to the Depositor the Mortgage
Loan to
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be released pursuant hereto in the same
manner, and on the same terms and
conditions, as it would a Mortgage Loan
repurchased for breach of a
representation or warranty contained in
Section 2.03.
SECTION 2.06. Authentication and Delivery of Certificates.
The Trustee acknowledges the transfer and assignment to it of the
Trust
Fund and, concurrently with such transfer
and assignment, the Securities
Administrator has caused to be
authenticated and delivered to or upon the order
of the Depositor, in exchange for the
Mortgage Loans, Certificates duly
authenticated by the Authenticating Agent
in authorized denominations evidencing
ownership of the entire Trust Fund. The
Trustee agrees to hold the Trust Fund
and exercise the rights referred to above
for the benefit of all present and
future Holders of the Certificates and to
perform its duties set forth in this
Agreement in accordance with the provisions
hereof.
SECTION 2.07. REMIC Elections.
(a) The Depositor hereby instructs and authorizes the
Securities Administrator to make an
appropriate election to treat each of the
Upper Tier REMIC and the Lower Tier REMIC
as a REMIC. The Trustee, upon written
direction of, and submission of such
returns to the Trustee by the Securities
Administrator, shall sign the returns
providing for such elections and such
other tax or information returns which are
required to be signed by the Trustee
under applicable law. This Agreement shall
be construed so as to carry out the
intention of the parties that each of the
Upper Tier REMIC and the Lower Tier
REMIC be treated as a REMIC at all times
prior to the date on which the Trust
Fund is terminated.
(b) The Preliminary Statement sets forth the designations and
"latest possible maturity date" for federal
income tax purposes of all interests
created hereby. The "Startup Day" for
purposes of the REMIC Provisions shall be
the Closing Date. Each REMIC's fiscal year
shall be the calendar year.
The Lower Tier REMIC shall consist of all of the assets of the
Trust Fund (other than (i) amounts
distributable to the Class P Certificates
pursuant to Section 4.04(b)(i) hereof, (ii)
the interests issued by the Lower
Tier REMIC and (iii) the grantor trusts
described in Section 2.07 hereof. The
Lower Tier REMIC shall issue the Class
LTA-1A Interest, Class LTA-1B Interest,
Class LTB-1 Interest, Class LTB-2 Interest,
Class LTB-3 Interest, Class LTB-4
Interest, Class LTB-5 Interest, Class LTM-1
Interest, Class LTM-2 Interest and
Class LTX Interest which shall be
designated as regular interests of such REMIC
and shall issue the Class LTR Interest that
shall be designated as the sole
class of residual interest in the Lower
Tier REMIC. Each of the Lower Tier REMIC
Regular Interests shall have the
characteristics set forth in its definition.
The assets of the Upper Tier REMIC shall be the Lower Tier
REMIC Regular Interests. The REMIC Regular
Interests shall be designated as the
regular interests in the Upper Tier REMIC
and the Residual Interest shall be
designated as the sole class of residual
interest in the Upper Tier REMIC. For
federal income tax purposes, the
pass-through rate on each REMIC Regular
Interest (other than the Uncertificated
Class C Interest) and on the sole class
of residual interest in the Upper Tier
REMIC shall be subject to a cap equal to
the Net Rate.
The beneficial ownership of the Class LTR Interest and the
Residual Interest shall be represented by
the Class R Certificate. The Class LTR
Interest shall not have a principal balance
or bear interest.
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(c) The
"tax matters person" with respect to each REMIC for
purposes of the REMIC Provisions shall be
the beneficial owner of the Class R
Certificate; provided, however, that the
Holder of a Class R Certificate, by its
acceptance thereof, irrevocably appoints
the Securities Administrator as its
agent and attorney-in-fact to act as "tax
matters person" with respect to each
REMIC for purposes of the REMIC Provisions.
If there is more than one beneficial
owner of the Class R Certificate, the "tax
matters person" shall be the Person
with the greatest percentage interest in
the Class R Certificate and, if there
is more than one such Person, shall be
determined under Treasury regulation
Section 1.860F-4(d) and Treasury regulation
Section 301.6231(a)(7)-1.
(d) It is intended that the rights of each Class of the Class
A, Class M and Class B Certificates to
receive payments in respect of Excess
Interest shall be treated as a right in
interest rate cap contracts written by
the Class C Certificateholders in favor of
the holders of each Class of the
Class A, Class M and Class B Certificates
and such shall be accounted for as
property held separate and apart from the
regular interests in the Upper Tier
REMIC held by the holders of the Class A
(other than the Class R Certificate),
Class M and Class B Certificates and the
residual interest in the Upper Tier
REMIC held by the holder of the Class R
Certificate. For information reporting
requirements, the rights of the Class A,
Class M and Class B Certificates to
receive payments in respect of Excess
Interest shall be assumed to have zero
value or a de minimis value. This provision
is intended to satisfy the
requirements of Treasury Regulations
Section 1.860G-2(i) for the treatment of
property rights coupled with REMIC
interests to be separately respected and
shall be interpreted consistently with such
regulation. On each Distribution
Date, to the extent that any of the Class
A, Class M and Class B Certificates
receive payments of Excess Interest, such
amounts will be treated as distributed
by the Upper-Tier REMIC to the Class C
Certificates pro rata in payment of the
amounts specified in Section 4.04(g) and
then paid to the relevant Class of
Certificates pursuant to the related
interest rate cap agreement.
(e) The parties intend that the portion of the Trust Fund
consisting of the Uncertificated Class C
Interest and the obligation of the
holders of the Class C Certificates to pay
amounts of Excess Interest to the
holders of the Class A, Class M and Class B
Certificates shall be treated as a
"grantor trust" under the Code, and the
provisions hereof shall be interpreted
consistently with this intention. In
furtherance of such intention, the
Securities Administrator shall (i) furnish
or cause to be furnished to the
holders of the Class C Certificates
information regarding their allocable share,
if any, of the income with respect to such
grantor trust, (ii) file or cause to
be filed with the Internal Revenue Service
Form 1041 (together with any
necessary attachments) and such other forms
as may be applicable and (iii)
comply with such information reporting
obligations with respect to payments from
such grantor trust to the holders of Class
A, Class M, Class B and Class C
Certificates as may be applicable under the
Code.
(f) The parties intend that the portion of the Trust Fund
consisting of the right to receive payments
distributable to the Class P
Certificates pursuant to Section 4.04(b)(i)
hereof shall be treated as a
"grantor trust" under the Code, and the
provisions hereof shall be interpreted
consistently with this intention. In
furtherance of such intention, the
Securities Administrator shall (i) furnish
or cause to be furnished to the
holders of the Class P Certificates
information regarding their allocable share
of the income with respect to such grantor
trust and (ii) file or cause to be
filed with the Internal Revenue Service
Form 1041 (together with any necessary
attachments) and such other forms as may be
applicable.
(g) [RESERVED]
(h) All payments of principal and interest at the Net Mortgage
Rate on each of the Mortgage Loans (other
than payments distributable to the
Class P Certificates pursuant to Section
4.04(b)(i) hereof) received from the
Mortgage Loans shall be paid to the Lower
Tier REMIC Regular
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Interests until the principal balance of
all such interests have been reduced to
zero and any losses allocated to such
interests have been reimbursed. Any excess
amounts shall be distributed to the Class
LTR Interest. On each Distribution
Date, an amount equal to 50% of the
increase in the Overcollateralization Amount
shall be payable as a reduction of the
principal amounts of the Lower Tier REMIC
Marker Classes (with such amount allocated
among the Lower Tier REMIC Marker
Classes so that each Lower Tier REMIC
Marker Class will have its principal
reduced by an amount equal to 50% of any
increase in the Overcollateralization
Amount that results in a reduction in the
principal balance of its Related
Certificates) and will be accrued and added
to the principal balance of the
Class LTX Interest. All payments of
scheduled principal and prepayments of
principal on the Mortgage Loans shall be
allocated 50% to the Class LTX Interest
and 50% to the Lower Tier REMIC Marker
Classes (with principal payments
allocated to each of the Lower Tier REMIC
Marker Classes in an amount equal to
50% of the principal amounts distributed to
the Related Certificates in
reduction of their principal amounts).
Notwithstanding the preceding sentence,
an amount equal to the principal payments
that result in a reduction in the
Overcollateralization Amount shall be
treated as payable entirely to the Class
LTX Interest. Realized Losses that are
allocated to the Certificates shall be
applied to the Lower Tier REMIC Marker
Classes and the Class LTX Interest so
that after all distributions have been made
on each Distribution Date (i) the
principal balance of each of the Lower Tier
REMIC Marker Classes is equal to 50%
of the principal balance of the Related
Certificates and (ii) the principal
balance of the Class LTX Interest is equal
to the sum of (x) 50% of the
aggregate Stated Principal Balance of the
Mortgage Loans and (y) 50% of the
Overcollateralization Amount. Each Lower
Tier REMIC Marker Class shall be
entitled to receive an amount equal to 50%
of all amounts distributed to the
Related Certificates in respect of
unreimbursed amounts of Realized Losses. The
Class LTX Interest shall be entitled to
receive all other amounts distributed to
the Certificates in respect of unreimbursed
amounts of Realized Losses.
If on any Distribution Date the Certificate Principal Balance
of any Class of Certificates is increased
pursuant to the last sentence of the
definition of "Certificate Principal
Balance", then there shall be an equivalent
increase in the principal amounts of the
Lower Tier REMIC Regular Interests,
with such increase allocated (before the
making of distributions and the
allocation of losses on the Lower Tier
REMIC Regular Interests on such
Distribution Date) among the Lower Tier
REMIC Regular Interests so that (i) each
of the Lower Tier Marker Classes has a
principal balance equal to 50% of the
principal balance of the Related
Certificates, (ii) the Class LTX Interest has a
principal balance equal to the sum of (x)
50% of the aggregate Stated Principal
Balance of the Mortgage Loans and (y) 50%
of the Overcollateralization Amount.
(i) In the event that any REMIC provided for herein fails to
qualify as a REMIC, loses its status as a
REMIC or incurs federal, state or
local taxes as a result of a prohibited
transaction or prohibited contribution
under the REMIC Provisions due to the
negligent performance by a Servicer of its
duties and obligations set forth herein,
each Servicer shall indemnify the
Trustee, the Securities Administrator, the
Master Servicer and the Trust Fund
against any and all Losses resulting from
such negligence; provided, however,
that a Servicer shall not be liable for any
such Losses attributable to the
action or inaction of the Trustee, the
Securities Administrator, the Master
Servicer, the Depositor or the Holder of a
Class R Certificate, as applicable,
nor for any such Losses resulting from
misinformation provided by the Holder of
such Class R Certificate on which such
Servicer has relied. The foregoing shall
not be deemed to limit or restrict the
rights and remedies of the Holder of such
Class R Certificate now or hereafter
existing at law or in equity.
Notwithstanding the foregoing, however, in
no event shall a Servicer have any
liability (1) for any action or omission
that is taken in accordance with and in
compliance with the express terms of, or
which is expressly permitted by the
terms of, this Agreement, (2) for any
Losses other than those arising out of a
negligent performance by such Servicer of
its duties and obligations set forth
herein, and (3) for any special or
consequential damages to Certificateholders
(in addition to payment of principal and
interest on the Certificates).
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(j) In the event that any REMIC provided for herein fails to
qualify as a REMIC, loses its status as a
REMIC or incurs federal, state or
local taxes as a result of a prohibited
transaction or prohibited contribution
under the REMIC Provisions due to the
negligent performance by the Securities
Administrator of its duties and obligations
set forth herein, the Securities
Administrator shall indemnify the Servicers
and the Trust Fund against any and
all Losses resulting from such negligence;
provided, however, that the
Securities Administrator shall not be
liable for any such Losses attributable to
the action or inaction of a Servicer, the
Master Servicer, the Depositor, the
Trustee or the Holder of a Class R
Certificate, as applicable, nor for any such
Losses resulting from misinformation
provided by the Holder of such Class R
Certificate on which the Securities
Administrator has relied. The foregoing
shall not be deemed to limit or restrict
the rights and remedies of the Holder
of such Class R Certificate now or
hereafter existing at law or in equity.
Notwithstanding the foregoing, however, in
no event shall the Securities
Administrator have any liability (1) for
any action or omission that is taken in
accordance with and in compliance with the
express terms of, or which is
expressly permitted by the terms of, this
Agreement, (2) for any Losses other
than those arising out of a negligent
performance by the Securities
Administrator of its duties and obligations
set forth herein, and (3) for any
special or consequential damages to
Certificateholders (in addition to payment
of principal and interest on the
Certificates).
SECTION 2.08. [RESERVED]
SECTION 2.09. Covenants of the Servicers.
Each Servicer hereby covenants to each of the other parties to
this
Agreement as follows:
(a) such Servicer shall comply in the performance of its
obligations under this Agreement with all
reasonable rules and requirements of
the insurer under each Required Insurance
Policy;
(b) no written information, certificate of an officer,
statement furnished in writing or written
report delivered to the Depositor, the
Master Servicer, the Securities
Administrator or the Trustee, any Affiliate of
the Depositor, the Master Servicer, the
Securities Administrator, or the Trustee
and prepared by a Servicer pursuant to this
Agreement will be inaccurate in any
material respect, provided, however, that
such Servicer shall not be responsible
for inaccurate information provided to it
by third parties.
SECTION 2.10. [RESERVED]
SECTION 2.11. Permitted Activities of the Trust. The Trust is
created
for the object and purpose of engaging in
the Permitted Activities.
SECTION 2.12. Qualifying Special Purpose Entity. For purposes of
SFAS
140, the parties hereto intend that the
Trust Fund shall be treated as a
"qualifying special purpose entity" as such
term is used in SFAS 140 and any
successor rule thereto and its power and
authority as stated in Section 2.11 of
this Agreement shall be limited in
accordance with paragraph 35 or SFAS 140.
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
SECTION 3.01. Servicers to Service Mortgage Loans.
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For and on behalf of the Certificateholders, each Servicer
shall
service and administer the Mortgage Loans
for which it is responsible in
accordance with its respective Accepted
Servicing Practices. In connection with
such servicing and administration, each
Servicer shall have full power and
authority, acting alone and/or through
subservicers as provided in Section 3.02
hereof, to do or cause to be done any and
all things that it may deem necessary
or desirable in connection with such
servicing and administration, including but
not limited to, the power and authority,
subject to the terms hereof (i) to
execute and deliver, on behalf of the
Certificateholders and the Trustee,
customary consents or waivers and other
instruments and documents, (ii) to
consent to transfers of any Mortgaged
Property and assumptions of the Mortgage
Notes and related Mortgages (but only in
the manner provided in this Agreement),
(iii) to collect any Insurance Proceeds and
other Liquidation Proceeds and (iv)
subject to Section 3.12(a), to effectuate
foreclosure or other conversion of the
ownership of the Mortgaged Property
securing any Mortgage Loan; provided that,
subject to Section 6.03, no Servicer shall
take any action that is inconsistent
with or prejudices the interests of the
Trust Fund or the Certificateholders in
any Mortgage Loan serviced by it under this
Agreement or the rights and
interests of the other parties to this
Agreement except as otherwise required by
this Agreement or by law. Notwithstanding
anything in this Agreement to the
contrary, no Servicer shall make or permit
any modification, waiver or amendment
of any term of any Mortgage Loan which
would cause any of the REMICs provided
for herein to fail to qualify as a REMIC or
result in the imposition of any tax
under Section 860G(a) or 860G(d) of the
Code. Each Servicer shall represent and
protect the interest of the Trust Fund in
the same manner as it currently
protects its own interest in mortgage loans
in its own portfolio in any claim,
proceeding or litigation regarding a
Mortgage Loan, but in any case not in any
manner that is a lesser standard than that
provided in the first sentence of
this Section 3.01. Without limiting the
generality of the foregoing, each
Servicer, in its own name or in the name of
the Depositor and the Trustee, is
hereby authorized and empowered by the
Depositor and the Trustee, when such
Servicer believes it appropriate in its
reasonable judgment, to execute and
deliver, on behalf of the Trustee, the
Depositor, the Certificateholders or any
of them, any and all instruments of
satisfaction or cancellation, or of partial
or full release or discharge,
subordinations and all other comparable
instruments, with respect to the Mortgage
Loans, and with respect to the
Mortgaged Properties held for the benefit
of the Certificateholders. Each
Servicer shall prepare and deliver to the
Depositor, the Securities
Administrator and/or the Trustee such
documents requiring execution and delivery
by any or all of them as are necessary or
appropriate to enable such Servicer to
service and administer the Mortgage Loans,
to the extent that such Servicer is
not permitted to execute and deliver such
documents pursuant to the preceding
sentence. Upon receipt of such documents,
the Depositor, the Securities
Administrator and/or the Trustee shall
execute such documents and deliver them
to the related Servicer. For purposes of
this Section 3.01, the Trustee hereby
grants to each Servicer a limited power of
attorney to execute and file any and
all documents necessary to fulfill the
obligations of such Servicer under this
Section 3.01.
No Servicer shall be required to make any Servicing Advance
with
respect to a Mortgage Loan that is 150 days
or more delinquent.
Each Servicer shall deliver a list of Servicing Officers to the
Master
Servicer and the Trustee by the Closing
Date.
Each Servicer will transmit full-file credit reporting data for
each
Mortgage Loan pursuant to Fannie Mae Guide
Announcement 97-02 and that for each
Mortgage Loan, such Servicer agrees that it
shall report one of the following
statuses each month as follows: current,
delinquent (30-, 60-, 90-days, etc.),
foreclosed or charged-off.
Each Servicer further is authorized and empowered by the Trustee,
on
behalf of the Certificateholders and the
Trustee, in its own name or in the name
of the Sub-Servicer, when such Servicer or
the Sub-Servicer, as the case may be,
believes it is appropriate in its best
judgment to register
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any Mortgage Loan on the MERS System, or
cause the removal from the registration
of any Mortgage Loan on the MERS System, to
execute and deliver, on behalf of
the Trustee and the Certificateholders or
any of them, any and all instruments
of assignment and other comparable
instruments with respect to such assignment
or re-recording of a Mortgage in the name
of MERS, solely as nominee for the
Trustee and its successors and assigns. Any
reasonable expenses incurred in
connection with the actions described in
the preceding sentence or as a result
of MERS discontinuing or becoming unable to
continue operations in connection
with the MERS System, shall be subject to
withdrawal by such Servicer from the
