FINANCIAL ASSET SECURITIES CORP.,
Depositor
OCWEN LOAN SERVICING, LLC
Servicer
and
DEUTSCHE BANK NATIONAL TRUST COMPANY,
Trustee
POOLING AND SERVICING AGREEMENT
Dated as of November 1, 2005
Meritage Mortgage Loan Trust 2005-3
Asset-Backed Certificates, Series 2005-3
Table of Contents
ARTICLE I
DEFINITIONS
|
Section 1.01.
|
Defined Terms.
|
|
Section 1.02.
|
Accounting.
|
|
Section 1.03.
|
Allocation of Certain Interest
Shortfalls.
|
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
|
Section 2.01.
|
Conveyance of Mortgage Loans.
|
|
Section 2.02.
|
Acceptance by Trustee.
|
|
Section 2.03.
|
Repurchase or Substitution of Mortgage Loans by
the Originator or the Seller.
|
|
Section 2.04.
|
Intentionally Omitted.
|
|
Section 2.05.
|
Representations, Warranties and Covenants of the
Servicer.
|
|
Section 2.06.
|
Representations and Warranties of the
Depositor.
|
|
Section 2.07.
|
Issuance of Certificates.
|
|
Section 2.08.
|
Conveyance of Subsequent Mortgage
Loans.
|
|
Section 2.09.
|
Conveyance of REMIC Regular Interests and
Acceptance of REMIC 2, REMIC 3, REMIC 4 and REMIC 5 by the
Trustee; Issuance of Certificates.
|
ARTICLE III
ADMINISTRATION AND SERVICING OF THE
MORTGAGE LOANS
|
Section 3.01.
|
Servicer to Act as Servicer.
|
|
Section 3.02.
|
Sub-Servicing Agreements Between Servicer and
Sub-Servicers.
|
|
Section 3.03.
|
Successor Sub-Servicers.
|
|
Section 3.04.
|
Liability of the Servicer.
|
|
Section 3.05.
|
No Contractual Relationship Between
Sub-Servicers and the Trustee or Certificateholders.
|
|
Section 3.06.
|
Assumption or Termination of Sub-Servicing
Agreements by Trustee.
|
|
Section 3.07.
|
Collection of Certain Mortgage Loan
Payments.
|
|
Section 3.08.
|
Sub-Servicing Accounts.
|
|
Section 3.09.
|
Collection of Taxes, Assessments and Similar
Items; Servicing Accounts.
|
|
Section 3.10.
|
Collection Account and Distribution
Account.
|
|
Section 3.11.
|
Withdrawals from the Collection Account and
Distribution Account.
|
|
Section 3.12.
|
Investment of Funds in the Collection Account
and the Distribution Account.
|
|
Section 3.13.
|
[Reserved].
|
|
Section 3.14.
|
Maintenance of Hazard Insurance and Errors and
Omissions and Fidelity Coverage.
|
|
Section 3.15.
|
Enforcement of Due-On-Sale Clauses; Assumption
Agreements.
|
|
Section 3.16.
|
Realization Upon Defaulted Mortgage
Loans.
|
|
Section 3.17.
|
Trustee to Cooperate; Release of Mortgage
Files.
|
|
Section 3.18.
|
Servicing Compensation.
|
|
Section 3.19.
|
Reports to the Trustee; Collection Account
Statements.
|
|
Section 3.20.
|
Statement as to Compliance.
|
|
Section 3.21.
|
Independent Public Accountants’ Servicing
Report.
|
|
Section 3.22.
|
Access to Certain Documentation; Filing of
Reports by Trustee.
|
|
Section 3.23.
|
Title, Management and Disposition of REO
Property.
|
|
Section 3.24.
|
Obligations of the Servicer in Respect of
Prepayment Interest Shortfalls.
|
|
Section 3.25.
|
[Reserved].
|
|
Section 3.26.
|
Obligations of the Servicer in Respect of
Mortgage Rates and Monthly Payments.
|
|
Section 3.27.
|
[Reserved].
|
|
Section 3.28.
|
[Reserved].
|
|
Section 3.29.
|
Advance Facility.
|
ARTICLE IV
FLOW OF FUNDS
|
Section 4.01.
|
Distributions.
|
|
Section 4.02.
|
Reserved.
|
|
Section 4.03.
|
Statements.
|
|
Section 4.04.
|
Remittance Reports; Advances.
|
|
Section 4.05.
|
The Pre-Funding Account.
|
|
Section 4.06.
|
Interest Coverage Account.
|
|
Section 4.07.
|
Net WAC Rate Carryover Reserve
Account.
|
|
Section 4.08.
|
Distributions on the REMIC 1 Regular
Interests.
|
|
Section 4.09.
|
Allocation of Realized Losses.
|
ARTICLE V
THE CERTIFICATES
|
Section 5.01.
|
The Certificates.
|
|
Section 5.02.
|
Registration of Transfer and Exchange of
Certificates.
|
|
Section 5.03.
|
Mutilated, Destroyed, Lost or Stolen
Certificates.
|
|
Section 5.04.
|
Persons Deemed Owners.
|
|
Section 5.05.
|
Appointment of Paying Agent.
|
ARTICLE VI
THE SERVICER AND THE
DEPOSITOR
|
Section 6.01.
|
Liability of the Servicer and the
Depositor.
|
|
Section 6.02.
|
Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer or the Depositor.
|
|
Section 6.03.
|
Limitation on Liability of the Servicer and
Others.
|
|
Section 6.04.
|
Servicer Not to Resign.
|
|
Section 6.05.
|
Delegation of Duties.
|
|
Section 6.06.
|
[Reserved].
|
|
Section 6.07.
|
Inspection.
|
ARTICLE VII
DEFAULT
|
Section 7.01.
|
Servicer Events of Termination.
|
|
Section 7.02.
|
Trustee to Act; Appointment of
Successor.
|
|
Section 7.03.
|
Waiver of Defaults.
|
|
Section 7.04.
|
Notification to Certificateholders.
|
|
Section 7.05.
|
Survivability of Servicer
Liabilities.
|
ARTICLE VIII
THE TRUSTEE
|
Section 8.01.
|
Duties of Trustee.
|
|
Section 8.02.
|
Certain Matters Affecting the
Trustee.
|
|
Section 8.03.
|
Trustee Not Liable for Certificates or Mortgage
Loans.
|
|
Section 8.04.
|
Trustee May Own Certificates.
|
|
Section 8.05.
|
Trustee Fee and Expenses.
|
|
Section 8.06.
|
Eligibility Requirements for Trustee.
|
|
Section 8.07.
|
Resignation or Removal of Trustee.
|
|
Section 8.08.
|
Successor Trustee.
|
|
Section 8.09.
|
Merger or Consolidation of Trustee.
|
|
Section 8.10.
|
Appointment of Co-Trustee or Separate
Trustee.
|
|
Section 8.11.
|
Limitation of Liability.
|
|
Section 8.12.
|
Trustee May Enforce Claims Without Possession of
Certificates.
|
|
Section 8.13.
|
Suits for Enforcement.
|
|
Section 8.14.
|
Waiver of Bond Requirement.
|
|
Section 8.15.
|
Waiver of Inventory, Accounting and Appraisal
Requirement.
|
ARTICLE IX
REMIC ADMINISTRATION
|
Section 9.01.
|
REMIC Administration.
|
|
Section 9.02.
|
Prohibited Transactions and
Activities.
|
|
Section 9.03.
|
Indemnification with Respect to Certain Taxes
and Loss of REMIC Status.
|
ARTICLE X
TERMINATION
|
Section 10.01.
|
Termination.
|
|
Section 10.02.
|
Additional Termination Requirements.
|
ARTICLE XI
MISCELLANEOUS PROVISIONS
|
Section 11.01.
|
Amendment.
|
|
Section 11.02.
|
Recordation of Agreement;
Counterparts.
|
|
Section 11.03.
|
Limitation on Rights of
Certificateholders.
|
|
Section 11.04.
|
Governing Law; Jurisdiction.
|
|
Section 11.05.
|
Notices.
|
|
Section 11.06.
|
Severability of Provisions.
|
|
Section 11.07.
|
Article and Section References.
|
|
Section 11.08.
|
Notice to the Rating Agencies.
|
|
Section 11.09.
|
Further Assurances.
|
|
Section 11.10.
|
Benefits of Agreement.
|
|
Section 11.11.
|
Acts of Certificateholders.
|
Exhibits :
|
Exhibit A-1
|
Form of Class A-1 Certificates
|
|
Exhibit A-2
|
Form of Class A-2 Certificates
|
|
Exhibit A-3
|
Form of Class A-3 Certificates
|
|
Exhibit A-4
|
Form of Class A-4 Certificates
|
|
Exhibit A-5
|
Form of Class A-5 Certificates
|
|
Exhibit A-6
|
Form of Class M-1 Certificates
|
|
Exhibit A-7
|
Form of Class M-2 Certificates
|
|
Exhibit A-8
|
Form of Class M-3 Certificates
|
|
Exhibit A-9
|
Form of Class M-4 Certificates
|
|
Exhibit A-10
|
Form of Class M-5 Certificates
|
|
Exhibit A-11
|
Form of Class M-6 Certificates
|
|
Exhibit A-12
|
Form of Class M-7 Certificates
|
|
Exhibit A-13
|
Form of Class M-8 Certificates
|
|
Exhibit A-14
|
Form of Class M-9 Certificates
|
|
Exhibit A-15
|
Form of Class B-1 Certificates
|
|
Exhibit A-16
|
Form of Class B-2 Certificates
|
|
Exhibit A-17
|
Form of Class C Certificates
|
|
Exhibit A-18
|
Form of Class P Certificates
|
|
Exhibit A-19
|
Form of Class R Certificates
|
|
Exhibit A-20
|
Form of Class R-X Certificates
|
|
Exhibit B
|
[Reserved]
|
|
Exhibit C
|
Form of Mortgage Loan Purchase
Agreement
|
|
Exhibit D
|
Mortgage Loan Schedule
|
|
Exhibit E
|
Request for Release
|
|
Exhibit F-1
|
Form of Trustee’s Initial
Certification
|
|
Exhibit F-2
|
Form of Trustee’s Final
Certification
|
|
Exhibit F-3
|
Form of Receipt of Mortgage Note
|
|
Exhibit G
|
Form of Compliance Certificate
|
|
Exhibit H
|
Form of Lost Note Affidavit
|
|
Exhibit I
|
Form of Limited Power of Attorney
|
|
Exhibit J
|
Form of Investment Letter
|
|
Exhibit K
|
Form of Transfer Affidavit for Residual
Certificates
|
|
Exhibit L
|
Form of Transferor Certificate
|
|
Exhibit M
|
Form of ERISA Representation Letter
|
|
Exhibit N-1
|
Form of Depositor’s
Certification
|
|
Exhibit N-2
|
Form of Trustee’s Certification
|
|
Exhibit N-3
|
Form of Servicer’s
Certification
|
|
Exhibit O
|
Form of Cap Contract
|
|
Exhibit P
|
Form of Addition Notice
|
|
Exhibit Q
|
Form of Subsequent Transfer
Instrument
|
|
Schedule I
|
Prepayment Charge Schedule
|
This Pooling and Servicing Agreement
is dated as of November 1, 2005 (the “Agreement”),
among FINANCIAL ASSET SECURITIES CORP., as depositor (the
“Depositor”), OCWEN LOAN SERVICING, LLC, as servicer
(the “Servicer”) and DEUTSCHE BANK NATIONAL TRUST
COMPANY, as trustee (the “Trustee”).
PRELIMINARY STATEMENT:
The Depositor intends to sell
pass-through certificates (collectively, the
“Certificates”), to be issued hereunder in multiple
classes, which in the aggregate will evidence the entire beneficial
ownership interest in the Trust Fund created hereunder. The
Certificates will consist of twenty classes of
certificates,designated as (i) the Class A-1 Certificates, (ii) the
Class A-2 Certificates, (iii) the Class A-3 Certificates, (iv) the
Class A-4 Certificates, (v) the Class A-5 Certificates, (vi) the
Class M-1 Certificates, (vii) the Class M-2 Certificates, (viii)
the Class M-3 Certificates, (ix) the Class M-4 Certificates, (x)
the Class M-5 Certificates, (xi) the Class M-6 Certificates, (xii)
the Class M-7 Certificates, (xiii) the Class M-8 Certificates,
(xiv) the Class M-9 Certificates, (xv) the Class B-1 Certificates,
(xvi) the Class B-2 Certificates, (xvii) the Class C Certificates,
(xviii) the Class P Certificates, (xix) the Class R Certificates
and (xx) the Class R-X Certificates.
REMIC 1
As provided herein, the Trustee will
make an election to treat the segregated pool of assets consisting
of the Mortgage Loans and certain other related assets subject to
this Agreement (exclusive of the Pre-Funding Account, the Interest
Coverage Account, any Subsequent Mortgage Loan Interest, the Net
WAC Rate Carryover Reserve Account, any Servicer Prepayment Charge
Payment Amounts and the Cap Contract) as a real estate mortgage
investment conduit (a “REMIC”) for federal income tax
purposes, and such segregated pool of assets will be designated as
“REMIC 1.” The Class R-1 Interest will represent the
sole class of “residual interests” in REMIC 1 for
purposes of the REMIC Provisions (as defined herein) under federal
income tax law. The following table irrevocably sets forth the
designation, the Uncertificated REMIC 1 Pass-Through Rate, the
initial Uncertificated Principal Balance, and for purposes of
satisfying Treasury Regulation Section 1.860G-1(a)(4)(iii), the
“latest possible maturity date” for each of the REMIC 1
Regular Interests. None of the REMIC 1 Regular Interests will be
certificated.
REMIC 1
|
Designation
|
|
Uncertificated REMIC 1
Pass-Through Rate
|
|
Initial Uncertificated Principal
Balance
|
|
Assumed Final
Maturity Date
(1)
|
|
LT1
|
|
Variable (2)
|
|
$
|
515,098,276.74
|
|
January 2036
|
|
LT1PF
|
|
Variable (2)
|
|
$
|
54,601,623.26
|
|
January 2036
|
|
LTP
|
|
Variable (2)
|
|
$
|
100.00
|
|
January 2036
|
________________
|
(1)
|
For purposes of Section
1.860G-1(a)(4)(iii) of the Treasury regulations, the Distribution
Date in the month immediately following the maturity date for the
Mortgage Loan with the latest possible maturity date has been
designated as the “latest possible maturity date” for
each REMIC 1 Regular Interest.
|
|
(2)
|
Calculated in accordance with the
definition of “Uncertificated REMIC 1 Pass-Through
Rate” herein.
|
REMIC 2
As provided herein, the Trustee will
make an election to treat the segregated pool of assets consisting
of the REMIC 1 Regular Interests as a REMIC for federal income tax
purposes, and such segregated pool of assets will be designated as
“REMIC 2.” The Class R-2 Interest will represent the
sole class of “residual interests” in REMIC 2 for
purposes of the REMIC Provisions (as defined herein) under federal
income tax law. The following table irrevocably sets forth the
designation, the Uncertificated REMIC 2 Pass-Through Rate, the
initial Uncertificated Principal Balance, and for purposes of
satisfying Treasury Regulation Section 1.860G-1(a)(4)(iii), the
“latest possible maturity date” for each of the REMIC 2
Regular Interests. None of the REMIC 2 Regular Interests will be
certificated.
|
Designation
|
|
Uncertificated REMIC 2
Pass-Through Rate
|
|
Initial Uncertificated Principal
Balance
|
|
Assumed Final
Maturity Date
(1)
|
|
LTAA
|
|
Variable (2)
|
|
$
|
558,305,902.00
|
|
January 2036
|
|
LTA1
|
|
Variable (2)
|
|
$
|
2,272,970.00
|
|
January 2036
|
|
LTA2
|
|
Variable (2)
|
|
$
|
1,062,090.00
|
|
January 2036
|
|
LTA3
|
|
Variable (2)
|
|
$
|
714,460.00
|
|
January 2036
|
|
LTA4
|
|
Variable (2)
|
|
$
|
194,160.00
|
|
January 2036
|
|
LTA5
|
|
Variable (2)
|
|
$
|
108,810.00
|
|
January 2036
|
|
LTM1
|
|
Variable (2)
|
|
$
|
193,700.00
|
|
January 2036
|
|
LTM2
|
|
Variable (2)
|
|
$
|
199,400.00
|
|
January 2036
|
|
LTM3
|
|
Variable (2)
|
|
$
|
139,580.00
|
|
January 2036
|
|
LTM4
|
|
Variable (2)
|
|
$
|
108,240.00
|
|
January 2036
|
|
LTM5
|
|
Variable (2)
|
|
$
|
102,550.00
|
|
January 2036
|
|
LTM6
|
|
Variable (2)
|
|
$
|
91,150.00
|
|
January 2036
|
|
LTM7
|
|
Variable (2)
|
|
$
|
99,700.00
|
|
January 2036
|
|
LTM8
|
|
Variable (2)
|
|
$
|
76,910.00
|
|
January 2036
|
|
LTM9
|
|
Variable (2)
|
|
$
|
68,360.00
|
|
January 2036
|
|
LTB1
|
|
Variable (2)
|
|
$
|
65,520.00
|
|
January 2036
|
|
LTB2
|
|
Variable (2)
|
|
$
|
59,820.00
|
|
January 2036
|
|
LTZZ
|
|
Variable (2)
|
|
$
|
5,836,578.00
|
|
January 2036
|
|
LTP
|
|
Variable (2)
|
|
$
|
100.00
|
|
January 2036
|
________________
|
( 1)
|
For purposes of Section
1.860G-1(a)(4)(iii) of the Treasury regulations, the Distribution
Date in the month immediately following the maturity date for the
Mortgage Loan with the latest possible maturity date has been
designated as the “latest possible maturity date” for
each REMIC 2 Regular Interest.
|
|
(2)
|
Calculated in accordance with the
definition of “Uncertificated REMIC 2 Pass-Through
Rate” herein.
|
REMIC 3
As provided herein, the Trustee
shall make an election to treat the segregated pool of assets
consisting of the REMIC 2 Regular Interests as a REMIC for federal
income tax purposes, and such segregated pool of assets will be
designated as “REMIC 3.” The Class R-3 Interest
represents the sole class of “residual interests” in
REMIC 3 for purposes of the REMIC Provisions.
The following table sets forth (or
describes) the Class designation, Pass-Through Rate and Original
Class Certificate Principal Balance for each Class of Certificates
that represents one or more of the “regular interests”
in REMIC 3 created hereunder and REMIC 3 Regular Interests C and
P:
|
Class Designation
|
|
Original Class Certificate
Principal Balance
|
|
Pass-Through Rate
|
|
Assumed Final
Maturity Date
(1)
|
|
Class A-1
|
|
$
|
227,297,000.00
|
|
Variable (2)
|
|
January 2036
|
|
Class A-2
|
|
$
|
106,209,000.00
|
|
Variable (2)
|
|
January 2036
|
|
Class A-3
|
|
$
|
71,446,000.00
|
|
Variable (2)
|
|
January 2036
|
|
Class A-4
|
|
$
|
19,416,000.00
|
|
Variable (2)
|
|
January 2036
|
|
Class A-5
|
|
$
|
10,881,000.00
|
|
Variable (2)
|
|
January 2036
|
|
Class M-1
|
|
$
|
19,370,000.00
|
|
Variable (2)
|
|
January 2036
|
|
Class M-2
|
|
$
|
19,940,000.00
|
|
Variable (2)
|
|
January 2036
|
|
Class M-3
|
|
$
|
13,958,000.00
|
|
Variable (2)
|
|
January 2036
|
|
Class M-4
|
|
$
|
10,824,000.00
|
|
Variable (2)
|
|
January 2036
|
|
Class M-5
|
|
$
|
10,255,000.00
|
|
Variable (2)
|
|
January 2036
|
|
Class M-6
|
|
$
|
9,115,000.00
|
|
Variable (2)
|
|
January 2036
|
|
Class M-7
|
|
$
|
9,970,000.00
|
|
Variable (2)
|
|
January 2036
|
|
Class M-8
|
|
$
|
7,691,000.00
|
|
Variable (2)
|
|
January 2036
|
|
Class M-9
|
|
$
|
6,836,000.00
|
|
Variable (2)
|
|
January 2036
|
|
Class B-1
|
|
$
|
6,552,000.00
|
|
Variable (2)
|
|
January 2036
|
|
Class B-2
|
|
$
|
5,982,000.00
|
|
Variable (2)
|
|
January 2036
|
|
Class C Interest
|
|
$
|
13,957,900.00
|
|
Variable (2)
|
|
January 2036
|
|
Class P Interest
|
|
$
|
100.00
|
|
N/A (4)
|
|
January 2036
|
________________
|
( 1)
|
For purposes of Section
1.860G-1(a)(4)(iii) of the Treasury regulations, the Distribution
Date in the month immediately following the maturity date for the
Mortgage Loan with the latest maturity date has been designated as
the “latest possible maturity date” for each Class of
Certificates that represents one or more of the “regular
interests” in REMIC 3.
|
|
(2)
|
Calculated in accordance with the
definition of “Pass-Through Rate” herein.
|
|
(3)
|
The Class C Interest will accrue
interest based only on clause (i) of the then applicable
Pass-Through Rate on the Notional Amount of the Class C Interest
outstanding from time to time which shall equal the aggregate of
the Uncertificated Principal Balances of the REMIC 2 Regular
Interests (other than REMIC 2 Regular Interest LTP) and at the Net
WAC Rate on $100.00. The Class C Interest will not accrue interest
on its Certificate Principal Balance.
|
|
(4)
|
The Class P Interest will not accrue
interest.
|
REMIC 4
As provided herein, the Trustee
shall make an election to treat the segregated pool of assets
consisting of the Class C Interest as a REMIC for federal income
tax purposes, and such segregated pool of assets will be designated
as “REMIC 4.” The Class R-4 Interest represents the
sole class of “residual interests” in REMIC 4 for
purposes of the REMIC Provisions.
The following table sets forth (or
describes) the Class designation, Pass-Through Rate and Original
Class Certificate Principal Balance for the indicated Class of
Certificates that represents a “regular interest” in
REMIC 4 created hereunder:
|
Class Designation
|
|
Initial
Aggregate Certificate Principal
Balance
|
|
Pass-Through Rate
|
|
Assumed Final
Maturity Date
(1)
|
|
Class C Certificates
|
|
$
|
13,957,900.00
|
|
Variable (2)
|
|
January 2036
|
|
|
|
|
|
|
|
|
|
_______________
|
(1)
|
For purposes of Section
1.860G-1(a)(4)(iii) of the Treasury regulations, the Distribution
Date immediately following the maturity date for the Mortgage Loans
with the latest maturity date has been designated as the
“latest possible maturity date” for the Class C
Certificates.
|
|
(2)
|
The Class C Certificates will
receive 100% of amounts received in respect of the Class C
Interest. The Class C Certificates will also be entitled to
Subsequent Mortgage Loan Interest, as a right with respect to a
component of the Class C Certificates that will not be treated as a
REMIC regular interest but rather as separate interest strips from
the Subsequent Mortgage Loans for a specified period of
time.
|
REMIC 5
As provided herein, the Trustee
shall make an election to treat the segregated pool of assets
consisting of the Class P Interest as a REMIC for federal income
tax purposes, and such segregated pool of assets will be designated
as “REMIC 5.” The Class R-5 Interest represents the
sole class of “residual interests” in REMIC 5 for
purposes of the REMIC Provisions.
The following table sets forth (or
describes) the Class designation, Pass-Through Rate and Original
Class Certificate Principal Balance for the indicated Class of
Certificates that represents a “regular interest” in
REMIC 5 created hereunder:
|
Class Designation
|
|
Initial
Aggregate Certificate Principal
Balance
|
|
Pass-Through Rate
|
|
Assumed Final
Maturity Date
(1)
|
|
Class P Certificates
|
|
$
|
100.00
|
|
Variable (2)
|
|
January 2036
|
|
|
|
|
|
|
|
|
|
_______________
|
(1)
|
For purposes of Section
1.860G-1(a)(4)(iii) of the Treasury regulations, the Distribution
Date immediately following the maturity date for the Mortgage Loans
with the latest maturity date has been designated as the
“latest possible maturity date” for the Class P
Certificates.
|
|
(2)
|
The Class P Certificates will
receive 100% of amounts received in respect of the Class P
Interest.
|
ARTICLE I
DEFINITIONS
|
|
SECTION 1.01.
|
Defined Terms.
|
Whenever used in this Agreement or
in the Preliminary Statement, the following words and phrases,
unless the context otherwise requires, shall have the meanings
specified in this Article. Unless otherwise specified, all
calculations in respect of interest on the Floating Rate
Certificates shall be made on the basis of the actual number of
days elapsed and a 360-day year and all other calculations of
interest described herein shall be made on the basis of a 360-day
year consisting of twelve 30-day months. The Class P Certificates
and the Residual Certificates are not entitled to distributions in
respect of interest and, accordingly, will not accrue
interest.
“1933 Act”: The
Securities Act of 1933, as amended.
“Account”: Either of the
Collection Account or the Distribution Account.
“Accrual Period”: With
respect to the Fixed Rate Certificates and the Class C Certificates
and each Distribution Date, the calendar month prior to the month
of such Distribution Date. With respect to the Floating Rate
Certificates and each Distribution Date, the period commencing on
the preceding Distribution Date (or in the case of the first such
Accrual Period, commencing on the Closing Date) and ending on the
day preceding the current Distribution Date. With respect to the
Class C Certificates and each Distribution Date, the calendar month
prior to the month of such Distribution Date.
“Addition Notice”: With
respect to the transfer of Subsequent Mortgage Loans to the Trust
Fund pursuant to Section 2.08, a notice of the Depositor’s
designation of the Subsequent Mortgage Loans to be sold to the
Trust Fund and the aggregate principal balance of such Subsequent
Mortgage Loans as of the Subsequent Cut-off Date. The Addition
Notice shall be given not later than three Business Days prior to
the related Subsequent Transfer Date and shall be substantially in
the form attached hereto as Exhibit P.
“Adjustable-Rate Mortgage
Loan”: A first lien Mortgage Loan which provides at any
period during the life of such loan for the adjustment of the
Mortgage Rate payable in respect thereto.
“Adjusted Net Maximum Mortgage
Rate”: With respect to any Mortgage Loan (or the related REO
Property), as of any date of determination, a per annum rate of
interest equal to the applicable Maximum Mortgage Rate for such
Mortgage Loan (or the Mortgage Rate in the case of any Fixed-Rate
Mortgage Loan) as of the first day of the month preceding the month
in which the related Distribution Date occurs minus the sum of (i)
the Trustee Fee Rate and (ii) the Servicing Fee Rate.
“Adjustment Date”: With
respect to each Adjustable-Rate Mortgage Loan, each adjustment date
on which the Mortgage Rate of such Adjustable-Rate Mortgage Loan
changes
pursuant to the related Mortgage
Note. The first Adjustment Date following the Cut-off Date as to
each Adjustable-Rate Mortgage Loan is set forth in the Mortgage
Loan Schedule.
“Advance”: As to any
Mortgage Loan or REO Property, any advance made by the Servicer in
respect of any Distribution Date pursuant to Section
4.04.
“Advance Facility”: As
defined in Section 3.29 hereof.
“Advance Facility
Trustee”: As defined in Section 3.29 hereof.
“Advancing Person”: As
defined in Section 3.29 hereof.
“Advance Reimbursement
Amounts”: As defined in Section 3.29 hereof.
“Adverse REMIC Event”:
As defined in Section 9.01(f) hereof.
“Affiliate”: With
respect to any Person, any other Person controlling, controlled by
or under common control with such Person. For purposes of this
definition, “control” means the power to direct the
management and policies of a Person, directly or indirectly,
whether through ownership of voting securities, by contract or
otherwise and “controlling” and
“controlled” shall have meanings correlative to the
foregoing.
“Agreement”: This
Pooling and Servicing Agreement and all amendments hereof and
supplements hereto.
“Allocated Realized Loss
Amount”: With respect to any Distribution Date and any Class
of Mezzanine Certificates or the Class B Certificates, the sum of
(i) any Realized Losses allocated to such Class of Certificates on
such Distribution Date and (ii) the amount of any Allocated
Realized Loss Amounts for such Class of Certificates remaining
unpaid from the previous Distribution Date and reduced by the
amount of any Subsequent Recoveries added to the Certificate
Principal Balance of such Class of Certificates.
“Assignment”: An
assignment of Mortgage, notice of transfer or equivalent
instrument, in recordable form, which is sufficient under the laws
of the jurisdiction wherein the related Mortgaged Property is
located to reflect or record the sale of the Mortgage.
“Assumed Final Maturity
Date”: As to each Class of Certificates, the date set forth
as such in the Preliminary Statement.
“Available Funds”: With
respect to any Distribution Date, an amount equal to the excess of
(i) the sum of (a) the aggregate of the related Monthly Payments
received on the Mortgage Loans on or prior to the related
Determination Date, (b) Net Liquidation Proceeds, Insurance
Proceeds, Principal Prepayments, Subsequent Recoveries, proceeds
from repurchases of and substitutions for such Mortgage Loans and
other unscheduled recoveries of principal and interest in respect
of the Mortgage Loans received during the related Prepayment
Period, (c) the aggregate of any amounts received in respect of a
related REO Property withdrawn from any REO Account and deposited
in the Collection Account for such Distribution Date, (d) the
aggregate of any amounts deposited in the Collection Account by the
Servicer in respect of
related Prepayment Interest
Shortfalls for such Distribution Date, (e) the aggregate of any
Advances made by the Servicer for such Distribution Date in respect
of the Mortgage Loans, (f) the aggregate of any related advances
made by the Trustee in respect of the Mortgage Loans for such
Distribution Date pursuant to Section 7.02; (g) the amount of any
Prepayment Charges collected by the Servicer in connection with the
full or partial prepayment of any of the Mortgage Loans and any
Servicer Prepayment Charge Payment Amount; (h) with respect to the
Distribution Date in the month following the end of the Funding
Period, any amounts in the Pre-Funding Account (exclusive of any
investment income therein) after giving effect to any purchase of
Subsequent Mortgage Loans and (i) with respect to each Distribution
Date during the Funding Period and on the two Distribution Dates
immediately following the end of the Funding Period, any amounts
withdrawn by the Trustee from the Interest Coverage Accounts for
distribution on the Certificates on such Distribution Date over
(ii) the sum of (a) amounts reimbursable or payable to the Servicer
pursuant to Section 3.11(a) or the Trustee pursuant to Section
3.11(b), (b) amounts deposited in the Collection Account or the
Distribution Account pursuant to clauses (a) through (g) above, as
the case may be, in error, (c) the amount of any Prepayment Charges
collected by the Servicer in connection with the full or partial
prepayment of any of the Mortgage Loans and any Servicer Prepayment
Charge Payment Amount, (d) the Trustee Fee payable from the
Distribution Account pursuant to Section 8.05 and (e) any
indemnification payments or expense reimbursements made by the
Trust Fund pursuant to Section 6.03 or Section 8.05.
“Balloon Mortgage Loan”:
A Fixed-Rate Mortgage Loan that provides for the payment of the
unamortized Stated Principal Balance of such Mortgage Loan in a
single payment at the maturity of such Fixed-Rate Mortgage Loan
that is substantially greater than the preceding monthly
payment.
“Balloon Payment”: A
payment of the unamortized Stated Principal Balance of a Fixed-Rate
Mortgage Loan in a single payment at the maturity of such
Fixed-Rate Mortgage Loan that is substantially greater than the
preceding Monthly Payment.
“Bankruptcy Code”: The
Bankruptcy Reform Act of 1978 (Title 11 of the United States Code),
as amended.
“Base Rate”: For any
Distribution Date and the Floating Rate Certificates, the sum of
(i) LIBOR plus (ii) the related Certificate Margin.
“Basic Principal Distribution
Amount”: With respect to any Distribution Date, the excess of
(i) the Principal Remittance Amount for such Distribution Date over
(ii) the Overcollateralization Release Amount, if any, for such
Distribution Date.
“Book-Entry
Certificates”: Any of the Certificates that shall be
registered in the name of the Depository or its nominee, the
ownership of which is reflected on the books of the Depository or
on the books of a Person maintaining an account with the Depository
(directly, as a “Depository Participant”, or
indirectly, as an indirect participant in accordance with the rules
of the Depository and as described in Section 5.02 hereof). On the
Closing Date, the Class A Certificates, the Mezzanine Certificates
and the Class B Certificates shall be Book-Entry
Certificates.
“Business Day”: Any day
other than a Saturday, a Sunday or a day on which banking or
savings institutions in the State of Delaware, the State of New
York, the State of California or in the city in which the Corporate
Trust Office of the Trustee is located are authorized or obligated
by law or executive order to be closed.
“Cap Amount”: The Cap
Amount for the Floating Rate Certificates is equal to (i) the
aggregate amount received by the Trust from the Cap Contract
multiplied by (ii) a fraction equal to (a) the Certificate
Principal Balance of such Class immediately prior to the applicable
Distribution Date divided by (b) the aggregate Certificate
Principal Balance of the Floating Rate Certificates immediately
prior to the applicable Distribution Date.
“Cap Contract”: The Cap
Contract between the cap counterparty and the Trustee, a form of
which is attached hereto as Exhibit O.
“Certificate”: Any
Regular Certificate or Residual Certificate.
“Certificateholder” or
“Holder”: The Person in whose name a Certificate is
registered in the Certificate Register, except that a Disqualified
Organization or non-U.S. Person shall not be a Holder of a Residual
Certificate for any purpose hereof and, solely for the purposes of
giving any consent pursuant to this Agreement, any Certificate
registered in the name of the Depositor or the Servicer or any
Affiliate thereof shall be deemed not to be outstanding and the
Voting Rights to which it is entitled shall not be taken into
account in determining whether the requisite percentage of Voting
Rights necessary to effect any such consent has been obtained,
except as otherwise provided in Section 11.01. The Trustee may
conclusively rely upon a certificate of the Depositor or the
Servicer in determining whether a Certificate is held by an
Affiliate thereof. All references herein to “Holders”
or “Certificateholders” shall reflect the rights of
Certificate Owners as they may indirectly exercise such rights
through the Depository and participating members thereof, except as
otherwise specified herein; provided, however, that the Trustee
shall be required to recognize as a “Holder” or
“Certificateholder” only the Person in whose name a
Certificate is registered in the Certificate Register.
“Certificate Margin”:
With respect to each of the Floating Rate Certificates, the
following percentage:
|
|
|
|
|
|
|
|
M-1
|
0.4500%
|
0.6750%
|
|
M-2
|
0.4700%
|
0.7050%
|
|
M-3
|
0.4900%
|
0.7350%
|
|
M-4
|
0.6200%
|
0.9300%
|
|
M-5
|
0.6800%
|
1.0200%
|
|
M-6
|
0.7500%
|
1.1250%
|
|
M-7
|
1.3500%
|
2.0250%
|
|
M-8
|
1.6500%
|
2.4750%
|
|
M-9
|
2.4000%
|
3.6000%
|
|
B-2
|
3.0000%
|
4.5000%
|
__________________
|
(1)
|
On or prior to the Optional
Termination Date.
|
|
(2)
|
After the Optional Termination
Date.
|
“Certificate Owner”:
With respect to each Book-Entry Certificate, any beneficial owner
thereof.
“Certificate Principal
Balance”: With respect to any Class of Regular Certificates
(other than the Class C Certificates) immediately prior to any
Distribution Date plus any Subsequent Recoveries added to the
Certificate Principal Balance of such Certificate pursuant to
Section 4.01, will be equal to the Initial Certificate Principal
Balance thereof reduced by the sum of all amounts actually
distributed in respect of principal of such Class and, in the case
of a Mezzanine Certificate or a Class B Certificate, Realized
Losses allocated thereto on all prior Distribution Dates. With
respect to the Class C Certificates as of any date of
determination, an amount equal to the excess, if any, of (A) the
then aggregate Uncertificated Principal Balance of the REMIC 2
Regular Interests over (B) the then aggregate Certificate Principal
Balance of the Class A Certificates, the Mezzanine Certificates,
the Class B Certificates and the Class P Certificates then
outstanding.
“Certificate Register”
and “Certificate Registrar”: The register maintained
and registrar appointed pursuant to Section 5.02 hereof.
“Class”: Collectively,
Certificates which have the same priority of payment and bear the
same class designation and the form of which is identical except
for variation in the Percentage Interest evidenced
thereby.
“Class A Certificates”:
Any Class A-1 Certificate, Class A-2 Certificate, Class A-3
Certificate, Class A-4 Certificate or Class A-5
Certificate.
“Class B Certificates”:
Any Class B-1 Certificate or Class B-2 Certificate.
“Class B-1 Certificate”:
Any one of the Class B-1 Certificates executed by the Trustee, and
authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit A-17,
representing the right to distributions as set forth herein and
therein and evidencing a regular interest in REMIC 3.
“Class B-1 Principal
Distribution Amount”: The excess of (x) the sum of (i) the
aggregate Certificate Principal Balance of the Class A Certificates
(after taking into account the distribution of the Senior Principal
Distribution Amount on such Distribution Date), (ii) the
Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution Amount on such Distribution Date), (iii) the
Certificate Principal Balance of the Class M-2 Certificates (after
taking into account the distribution of the Class M-2 Principal
Distribution Amount on such Distribution Date), (iv) the
Certificate Principal Balance of the Class M-3 Certificates (after
taking into account the distribution of the Class M-3 Principal
Distribution Amount on such Distribution Date), (v) the Certificate
Principal Balance of the Class M-4 Certificates (after taking into
account the distribution of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Certificate Principal
Balance of the Class M-5 Certificates (after taking into account
the distribution of the Class M-5 Principal Distribution Amount on
such Distribution Date), (vii) the Certificate Principal Balance of
the Class M-6 Certificates (after taking into account the
distribution of the Class M-6 Principal Distribution Amount on such
Distribution Date), (viii) the
Certificate Principal Balance of the
Class M-7 Certificates (after taking into account the distribution
of the Class M-7 Principal Distribution Amount on such Distribution
Date), (ix) the Certificate Principal Balance of the Class M-8
Certificates (after taking into account the distribution of the
Class M-8 Principal Distribution Amount on such Distribution Date),
(x) the Certificate Principal Balance of the Class M-9 Certificates
(after taking into account the distribution of the Class M-9
Principal Distribution Amount on such Distribution Date) and (xi)
the Certificate Principal Balance of the Class B-1 Certificates
immediately prior to such Distribution Date over (y) the lesser of
(A) the product of (i) 93.00% and (ii) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the
related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received
during the related Prepayment Period) and (B) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the
related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received
during the related Prepayment Period) minus the related
Overcollateralization Floor.
“Class B-2 Certificate”:
Any one of the Class B-2 Certificates executed by the Trustee, and
authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit A-18,
representing the right to distributions as set forth herein and
therein and evidencing a regular interest in REMIC 3.
“Class B-2 Principal
Distribution Amount”: The excess of (x) the sum of (i) the
aggregate Certificate Principal Balance of the Class A Certificates
(after taking into account the distribution of the Senior Principal
Distribution Amount on such Distribution Date), (ii) the
Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution Amount on such Distribution Date), (iii) the
Certificate Principal Balance of the Class M-2 Certificates (after
taking into account the distribution of the Class M-2 Principal
Distribution Amount on such Distribution Date), (iv) the
Certificate Principal Balance of the Class M-3 Certificates (after
taking into account the distribution of the Class M-3 Principal
Distribution Amount on such Distribution Date), (v) the Certificate
Principal Balance of the Class M-4 Certificates (after taking into
account the distribution of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Certificate Principal
Balance of the Class M-5 Certificates (after taking into account
the distribution of the Class M-5 Principal Distribution Amount on
such Distribution Date), (vii) the Certificate Principal Balance of
the Class M-6 Certificates (after taking into account the
distribution of the Class M-6 Principal Distribution Amount on such
Distribution Date), (viii) the Certificate Principal Balance of the
Class M-7 Certificates (after taking into account the distribution
of the Class M-7 Principal Distribution Amount on such Distribution
Date), (ix) the Certificate Principal Balance of the Class M-8
Certificates (after taking into account the distribution of the
Class M-8 Principal Distribution Amount on such Distribution Date),
(x) the Certificate Principal Balance of the Class M-9 Certificates
(after taking into account the distribution of the Class M-9
Principal Distribution Amount on such Distribution Date), (xi) the
Certificate Principal Balance of the Class B-1 Certificates (after
taking into account the distribution of the Class B-1 Principal
Distribution Amount on such Distribution Date) and (xii) the
Certificate Principal Balance of the Class B-2 Certificates
immediately prior to such Distribution Date over (y) the lesser of
(A) the product of (i) 95.10% and (ii) the aggregate
Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after
giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced, and
unscheduled collections of principal received during the related
Prepayment Period) and (B) the aggregate Stated Principal Balance
of the Mortgage Loans as of the last day of the related Due Period
(after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced, and
unscheduled collections of principal received during the related
Prepayment Period) minus the related Overcollateralization
Floor.
“Class C Certificates”:
Any one of the Class C Certificates executed by the Trustee, and
authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit A-19,
representing the right to distributions as set forth herein and
therein and evidencing a regular interest in REMIC 4.
“Class C Interest”: An
uncertificated interest in the Trust Fund held by the Trustee on
behalf of the Holders of the Class C Certificates, evidencing a
Regular Interest in REMIC 3 for purposes of the REMIC
Provisions.
“Class A-1 Certificate”:
Any one of the Class A-1 Certificates executed by the Trustee, and
authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit A-1,
representing the right to distributions as set forth herein and
therein and evidencing a regular interest in REMIC 3.
“Class A-2 Certificate”:
Any one of the Class A-2 Certificates executed by the Trustee, and
authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit A-2,
representing the right to distributions as set forth herein and
therein and evidencing a regular interest in REMIC 3.
“Class A-3 Certificate”:
Any one of the Class A-3 Certificates executed by the Trustee, and
authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit A-3,
representing the right to distributions as set forth herein and
therein and evidencing a regular interest in REMIC 3.
“Class A-4 Certificate”:
Any one of the Class A-4 Certificates executed by the Trustee, and
authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit A-4,
representing the right to distributions as set forth herein and
therein and evidencing a regular interest in REMIC 3.
“Class A-5 Certificate”:
Any one of the Class A-5 Certificates executed by the Trustee, and
authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit A-5,
representing the right to distributions as set forth herein and
therein and evidencing a regular interest in REMIC 3.
“Class M-1 Certificate”:
Any one of the Class M-1 Certificates executed by the Trustee, and
authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit A-6,
representing the right to distributions as set forth herein and
therein and evidencing a regular interest in REMIC 3.
“Class M-1 Principal
Distribution Amount”: The excess of (x) the sum of (i) the
aggregate Certificate Principal Balance of the Class A Certificates
(after taking into account the distribution of the Senior Principal
Distribution Amount on such Distribution Date) and (ii) the
Certificate Principal Balance of the Class M-1 Certificates
immediately prior to such Distribution Date over (y) the lesser of
(A) the product of (i) 59.60% and (ii) the Stated Principal Balance
of the Mortgage Loans as of the last day of the related Due Period
(after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced, and
unscheduled collections of principal received during the related
Prepayment Period) and (B) the aggregate Stated Principal Balance
of the Mortgage Loans as of the last day of the related Due Period
(after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced, and
unscheduled collections of principal received during the related
Prepayment Period) minus the related Overcollateralization
Floor.
“Class M-2 Certificate”:
Any one of the Class M-2 Certificates executed by the Trustee, and
authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit A-7,
representing the right to distributions as set forth herein and
therein and evidencing a regular interest in REMIC 3.
“Class M-2 Principal
Distribution Amount”: The excess of (x) the sum of (i) the
aggregate Certificate Principal Balance of the Class A Certificates
(after taking into account the distribution of the Senior Principal
Distribution Amount on such Distribution Date), (ii) the
Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution Amount on such Distribution Date) and (iii) the
Certificate Principal Balance of the Class M-2 Certificates
immediately prior to such Distribution Date over (y) the lesser of
(A) the product of (i) 66.60% and (ii) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the
related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received
during the related Prepayment Period) and (B) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the
related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received
during the related Prepayment Period) minus the related
Overcollateralization Floor.
“Class M-3 Certificate”:
Any one of the Class M-3 Certificates executed by the Trustee, and
authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit A-8,
representing the right to distributions as set forth herein and
therein and evidencing a regular interest in REMIC 3.
“Class M-3 Principal
Distribution Amount”: The excess of (x) the sum of (i) the
aggregate Certificate Principal Balance of the Class A Certificates
(after taking into account the distribution of the Senior Principal
Distribution Amount on such Distribution Date), (ii) the
Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution Amount on such Distribution Date), (iii) the
Certificate Principal Balance of the Class M-2 Certificates (after
taking into account the distribution of the Class M-2 Principal
Distribution Amount on such Distribution Date) and (iv) the
Certificate Principal Balance of the Class M-3 Certificates
immediately prior to such
Distribution Date over (y) the
lesser of (A) the product of (i) 71.50% and (ii) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day
of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the
extent received or advanced, and unscheduled collections of
principal received during the related Prepayment Period) and (B)
the aggregate Stated Principal Balance of the Mortgage Loans as of
the last day of the related Due Period (after giving effect to
scheduled payments of principal due during the related Due Period,
to the extent received or advanced, and unscheduled collections of
principal received during the related Prepayment Period) minus the
related Overcollateralization Floor.
“Class M-4 Certificate”:
Any one of the Class M-4 Certificates executed by the Trustee, and
authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit A-9,
representing the right to distributions as set forth herein and
therein and evidencing a regular interest in REMIC 3.
“Class M-4 Principal
Distribution Amount”: The excess of (x) the sum of (i) the
aggregate Certificate Principal Balance of the Class A Certificates
(after taking into account the distribution of the Senior Principal
Distribution Amount on such Distribution Date), (ii) the
Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution Amount on such Distribution Date), (iii) the
Certificate Principal Balance of the Class M-2 Certificates (after
taking into account the distribution of the Class M-2 Principal
Distribution Amount on such Distribution Date), (iv) the
Certificate Principal Balance of the Class M-3 Certificates (after
taking into account the distribution of the Class M-3 Principal
Distribution Amount on such Distribution Date) and (v) the
Certificate Principal Balance of the Class M-4 Certificates
immediately prior to such Distribution Date over (y) the lesser of
(A) the product of (i) 75.30% and (ii) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the
related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received
during the related Prepayment Period) and (B) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the
related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received
during the related Prepayment Period) minus the related
Overcollateralization Floor.
“Class M-5 Certificate”:
Any one of the Class M-5 Certificates executed by the Trustee, and
authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit A-10,
representing the right to distributions as set forth herein and
therein and evidencing a regular interest in REMIC 3.
“Class M-5 Principal
Distribution Amount”: The excess of (x) the sum of (i) the
aggregate Certificate Principal Balance of the Class A Certificates
(after taking into account the distribution of the Senior Principal
Distribution Amount on such Distribution Date), (ii) the
Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution Amount on such Distribution Date), (iii) the
Certificate Principal Balance of the Class M-2 Certificates (after
taking into account the distribution of the Class M-2 Principal
Distribution Amount on such Distribution Date), (iv) the
Certificate Principal Balance of the
Class M-3 Certificates (after taking into account the distribution
of the Class M-3 Principal Distribution Amount on such Distribution
Date), (v) the Certificate Principal Balance of the Class M-4
Certificates (after taking into account the distribution of the
Class M-4 Principal Distribution Amount on such Distribution Date)
and (vi) the Certificate Principal Balance of the Class M-5
Certificates immediately prior to such Distribution Date over (y)
the lesser of (A) the product of (i) 78.90% and (ii) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day
of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the
extent received or advanced, and unscheduled collections of
principal received during the related Prepayment Period) and (B)
the aggregate Stated Principal Balance of the Mortgage Loans as of
the last day of the related Due Period (after giving effect to
scheduled payments of principal due during the related Due Period,
to the extent received or advanced, and unscheduled collections of
principal received during the related Prepayment Period) minus the
related Overcollateralization Floor.
“Class M-6 Certificate”:
Any one of the Class M-6 Certificates executed by the Trustee, and
authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit A-11,
representing the right to distributions as set forth herein and
therein and evidencing a regular interest in REMIC 3.
“Class M-6 Principal
Distribution Amount”: The excess of (x) the sum of (i) the
aggregate Certificate Principal Balance of the Class A Certificates
(after taking into account the distribution of the Senior Principal
Distribution Amount on such Distribution Date), (ii) the
Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution Amount on such Distribution Date), (iii) the
Certificate Principal Balance of the Class M-2 Certificates (after
taking into account the distribution of the Class M-2 Principal
Distribution Amount on such Distribution Date), (iv) the
Certificate Principal Balance of the Class M-3 Certificates (after
taking into account the distribution of the Class M-3 Principal
Distribution Amount on such Distribution Date), (v) the Certificate
Principal Balance of the Class M-4 Certificates (after taking into
account the distribution of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Certificate Principal
Balance of the Class M-5 Certificates (after taking into account
the distribution of the Class M-5 Principal Distribution Amount on
such Distribution Date) and (vii) the Certificate Principal Balance
of the Class M-6 Certificates immediately prior to such
Distribution Date over (y) the lesser of (A) the product of (i)
82.10% and (ii) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after
giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced, and
unscheduled collections of principal received during the related
Prepayment Period) and (B) the aggregate Stated Principal Balance
of the Mortgage Loans as of the last day of the related Due Period
(after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced, and
unscheduled collections of principal received during the related
Prepayment Period) minus the related Overcollateralization
Floor.
“Class M-7 Certificate”:
Any one of the Class M-7 Certificates executed by the Trustee, and
authenticated and delivered by the Certificate Registrar,
substantially in the form
annexed hereto as Exhibit A-12,
representing the right to distributions as set forth herein and
therein and evidencing a regular interest in REMIC 3.
“Class M-7 Principal
Distribution Amount”: The excess of (x) the sum of (i) the
aggregate Certificate Principal Balance of the Class A Certificates
(after taking into account the distribution of the Senior Principal
Distribution Amount on such Distribution Date), (ii) the
Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution Amount on such Distribution Date), (iii) the
Certificate Principal Balance of the Class M-2 Certificates (after
taking into account the distribution of the Class M-2 Principal
Distribution Amount on such Distribution Date), (iv) the
Certificate Principal Balance of the Class M-3 Certificates (after
taking into account the distribution of the Class M-3 Principal
Distribution Amount on such Distribution Date), (v) the Certificate
Principal Balance of the Class M-4 Certificates (after taking into
account the distribution of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Certificate Principal
Balance of the Class M-5 Certificates (after taking into account
the distribution of the Class M-5 Principal Distribution Amount on
such Distribution Date), (vii) the Certificate Principal Balance of
the Class M-6 Certificates (after taking into account the
distribution of the Class M-6 Principal Distribution Amount on such
Distribution Date) and (viii) the Certificate Principal Balance of
the Class M-7 Certificates immediately prior to such Distribution
Date over (y) the lesser of (A) the product of (i) 85.60% and (ii)
the aggregate Stated Principal Balance of the Mortgage Loans as of
the last day of the related Due Period (after giving effect to
scheduled payments of principal due during the related Due Period,
to the extent received or advanced, and unscheduled collections of
principal received during the related Prepayment Period) and (B)
the aggregate Stated Principal Balance of the Mortgage Loans as of
the last day of the related Due Period (after giving effect to
scheduled payments of principal due during the related Due Period,
to the extent received or advanced, and unscheduled collections of
principal received during the related Prepayment Period) minus the
related Overcollateralization Floor.
“Class M-8 Certificate”:
Any one of the Class M-8 Certificates executed by the Trustee, and
authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit A-13,
representing the right to distributions as set forth herein and
therein and evidencing a regular interest in REMIC 3.
“Class M-8 Principal
Distribution Amount”: The excess of (x) the sum of (i) the
aggregate Certificate Principal Balance of the Class A Certificates
(after taking into account the distribution of the Senior Principal
Distribution Amount on such Distribution Date), (ii) the
Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution Amount on such Distribution Date), (iii) the
Certificate Principal Balance of the Class M-2 Certificates (after
taking into account the distribution of the Class M-2 Principal
Distribution Amount on such Distribution Date), (iv) the
Certificate Principal Balance of the Class M-3 Certificates (after
taking into account the distribution of the Class M-3 Principal
Distribution Amount on such Distribution Date), (v) the Certificate
Principal Balance of the Class M-4 Certificates (after taking into
account the distribution of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Certificate Principal
Balance of the Class M-5 Certificates (after taking into account
the distribution of the Class M-5 Principal Distribution Amount on
such Distribution Date), (vii) the
Certificate Principal Balance of the
Class M-6 Certificates (after taking into account the distribution
of the Class M-6 Principal Distribution Amount on such Distribution
Date), (viii) the Certificate Principal Balance of the Class M-7
Certificates (after taking into account the distribution of the
Class M-7 Principal Distribution Amount on such Distribution Date)
and (ix) the Certificate Principal Balance of the Class M-8
Certificates immediately prior to such Distribution Date over (y)
the lesser of (A) the product of (i) 88.30% and (ii) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day
of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the
extent received or advanced, and unscheduled collections of
principal received during the related Prepayment Period) and (B)
the aggregate Stated Principal Balance of the Mortgage Loans as of
the last day of the related Due Period (after giving effect to
scheduled payments of principal due during the related Due Period,
to the extent received or advanced, and unscheduled collections of
principal received during the related Prepayment Period) minus the
related Overcollateralization Floor.
“Class M-9 Certificate”:
Any one of the Class M-9 Certificates executed by the Trustee, and
authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit A-14,
representing the right to distributions as set forth herein and
therein and evidencing a regular interest in REMIC 3.
“Class M-9 Principal
Distribution Amount”: The excess of (x) the sum of (i) the
aggregate Certificate Principal Balance of the Class A Certificates
(after taking into account the distribution of the Senior Principal
Distribution Amount on such Distribution Date), (ii) the
Certificate Principal Balance of the Class M-1 Certificates (after
taking into account the distribution of the Class M-1 Principal
Distribution Amount on such Distribution Date), (iii) the
Certificate Principal Balance of the Class M-2 Certificates (after
taking into account the distribution of the Class M-2 Principal
Distribution Amount on such Distribution Date), (iv) the
Certificate Principal Balance of the Class M-3 Certificates (after
taking into account the distribution of the Class M-3 Principal
Distribution Amount on such Distribution Date), (v) the Certificate
Principal Balance of the Class M-4 Certificates (after taking into
account the distribution of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Certificate Principal
Balance of the Class M-5 Certificates (after taking into account
the distribution of the Class M-5 Principal Distribution Amount on
such Distribution Date), (vii) the Certificate Principal Balance of
the Class M-6 Certificates (after taking into account the
distribution of the Class M-6 Principal Distribution Amount on such
Distribution Date), (viii) the Certificate Principal Balance of the
Class M-7 Certificates (after taking into account the distribution
of the Class M-7 Principal Distribution Amount on such Distribution
Date), (ix) the Certificate Principal Balance of the Class M-8
Certificates (after taking into account the distribution of the
Class M-8 Principal Distribution Amount on such Distribution Date)
and (x) the Certificate Principal Balance of the Class M-9
Certificates immediately prior to such Distribution Date over (y)
the lesser of (A) the product of (i) 90.70% and (ii) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day
of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the
extent received or advanced, and unscheduled collections of
principal received during the related Prepayment Period) and (B)
the aggregate Stated Principal Balance of the Mortgage Loans as of
the last day of the related Due Period (after giving effect to
scheduled payments of principal due during the related Due Period,
to the extent received or advanced, and unscheduled collections
of
principal received during the
related Prepayment Period) minus the related Overcollateralization
Floor.
“Class P Certificate”:
Any one of the Class P Certificates executed by the Trustee, and
authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit A-18,
representing the right to distributions as set forth herein and
therein and evidencing a regular interest in REMIC 5.
“Class P Interest”: An
uncertificated interest in the Trust Fund held by the Trustee on
behalf of the Holders of the Class P Certificates, evidencing a
Regular Interest in REMIC 3 for purposes of the REMIC
Provisions.
“Class R Certificate”:
The Class R Certificate executed by the Trustee, and authenticated
and delivered by the Certificate Registrar, substantially in the
form annexed hereto as Exhibit A-19 and evidencing the ownership of
the Class R-1 Interest, the Class R-2 Interest and the Class R-3
Interest.
“Class R-1 Interest”:
The uncertificated Residual Interest in REMIC 1.
“Class R-2 Interest”:
The uncertificated Residual Interest in REMIC 2.
“Class R-3 Interest”:
The uncertificated Residual Interest in REMIC 3.
“Class R-4 Interest”:
The uncertificated Residual Interest in REMIC 4.
“Class R-5 Interest”:
The uncertificated Residual Interest in REMIC 5.
“Class R-X Certificate”:
The Class R-X Certificate executed by the Trustee, and
authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit A-20 and
evidencing the ownership of the Class R-4 Interest and the Class
R-5 Interest.
“Close of Business”: As
used herein, with respect to any Business Day, 5:00 p.m. (New York
time).
“Closing Date”: November
21, 2005.
“Code”: The Internal
Revenue Code of 1986, as amended.
“Collection Account”:
The segregated account or accounts created and maintained by the
Servicer pursuant to Section 3.10(a), which shall be entitled
“Ocwen Loan Servicing, LLC, as servicer for Deutsche Bank
National Trust Company, as Trustee, in trust for registered Holders
of Meritage Mortgage Loan Trust 2005-3, Asset-Backed Certificates,
Series 2005-3,” which must be an Eligible Account.
“Compensating Interest”:
As defined in Section 3.24 hereof.
“Corporate Trust
Office”: The principal corporate trust office of the Trustee
at which at any particular time its corporate trust business in
connection with this Agreement shall be administered, which office
at the date of the execution of this instrument is located at 1761
East St. Andrew Place, Santa Ana, CA 92705-4934, Attention: Trust
Administration GC05M3 or at such other address as the Trustee may
designate from time to time by notice to the Certificateholders,
the Depositor, the Servicer, the Originator and the
Seller.
“Corresponding
Certificate”: With respect to each REMIC 2 Regular Interest
set forth below, the corresponding Regular Certificate set forth in
the table below:
|
REMIC 2 Regular
Interest
|
|
Regular
Certificate
|
|
LTA1
|
|
Class A-1
|
|
LTA2
|
|
Class A-2
|
|
LTA3
|
|
Class A-3
|
|
LTA4
|
|
Class A-4
|
|
LTA5
|
|
Class A-5
|
|
LTM1
|
|
Class M-1
|
|
LTM2
|
|
Class M-2
|
|
LTM3
|
|
Class M-3
|
|
LTM4
|
|
Class M-4
|
|
LTM5
|
|
Class M-5
|
|
LTM6
|
|
Class M-6
|
|
LTM7
|
|
Class M-7
|
|
LTM8
|
|
Class M-8
|
|
LTM9
|
|
Class M-9
|
|
LTB1
|
|
Class B-1
|
|
LTB2
|
|
Class B-2
|
|
LTP
|
|
Class P
|
“Credit Enhancement
Percentage”: For any Distribution Date, the percentage
equivalent of a fraction, the numerator of which is the sum of the
aggregate Certificate Principal Balance of the Mezzanine
Certificates, the Class B Certificates and the Class C
Certificates, and the denominator of which is the sum of (x) the
aggregate Stated Principal Balance of the Mortgage Loans and (y)
any amounts remaining on deposit in the Pre-Funding Account
(exclusive of any investment income therein), calculated prior to
taking into account payments of principal on the Mortgage Loans and
distribution of the Principal Distribution Amount to the Holders of
the Certificates then entitled to distributions of principal on
such Distribution Date.
“Custodian”: Deutsche
Bank National Trust Company, as custodian of the Mortgage Files, or
any successor thereto.
“Cut-off Date”: With
respect to each Initial Mortgage Loan, the later of (i) the date of
origination of such Mortgage Loan or (ii) the Close of Business on
November 1, 2005.
“Cut-off Date Principal
Balance”: With respect to any Mortgage Loan, the unpaid
Stated Principal Balance thereof as of the Cut-off Date of such
Mortgage Loan (or as of the applicable date of substitution with
respect to a Qualified Substitute Mortgage Loan), after giving
effect to scheduled payments due on or before the Cut-off Date,
whether or not received.
“DBRS”: Dominion Bond
Ratings Service, or its successor in interest.
“Debt Service
Reduction”: With respect to any Mortgage Loan, a reduction in
the scheduled Monthly Payment for such Mortgage Loan by a court of
competent jurisdiction in a proceeding under the Bankruptcy Code,
except such a reduction resulting from a Deficient
Valuation.
“Deficient Valuation”:
With respect to any Mortgage Loan, a valuation of the related
Mortgaged Property by a court of competent jurisdiction in an
amount less than the then outstanding Stated Principal Balance of
the Mortgage Loan, which valuation results from a proceeding
initiated under the Bankruptcy Code.
“Definitive
Certificates”: As defined in Section 5.02(c)
hereof.
“Deleted Mortgage Loan”:
A Mortgage Loan replaced or to be replaced by one or more Qualified
Substitute Mortgage Loans.
“Delinquency
Percentage”: For any Distribution Date, the percentage
obtained by dividing (x) the aggregate Stated Principal Balance of
Mortgage Loans that are Delinquent 60 days or more, that are in
foreclosure, in bankruptcy (and Delinquent 60 days or more) or that
are REO Properties, as of the last day of the previous calendar
month by (y) the sum of (i) the aggregate Stated Principal Balance
of the Mortgage Loans, as of the last day of the previous calendar
month and (ii) any amounts remaining on deposit in the Pre-Funding
Account.
“Delinquent”: With
respect to any Mortgage Loan and related Monthly Payment, the
Monthly Payment due on a Due Date which is not made by the Close of
Business on the next scheduled Due Date for such Mortgage Loan. For
example, a Mortgage Loan is 60 or more days Delinquent if the
Monthly Payment due on a Due Date is not made by the Close of
Business on the second scheduled Due Date after such Due
Date.
“Depositor”: Financial
Asset Securities Corp., a Delaware corporation, or any successor in
interest.
“Depository”: The
initial Depository shall be The Depository Trust Company, whose
nominee is Cede & Co., or any other organization registered as
a “clearing agency” pursuant to Section 17A of the
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. Upon request, the
Depository may also be Clearstream Banking Luxembourg and the
Euroclear System.
“Depository
Participant”: A broker, dealer, bank or other financial
institution or other person for whom from time to time a Depository
effects book-entry transfers and pledges of securities deposited
with the Depository.
“Determination Date”:
With respect to any Distribution Date, the 15 th day of
the calendar month in which such Distribution Date occurs or, if
such 15 th day is not a Business Day, the Business Day
immediately preceding such 15 th day.
“Directly Operate”: With
respect to any REO Property, the furnishing or rendering of
services to the tenants thereof, the management or operation of
such REO Property, the holding of such REO Property primarily for
sale to customers, the performance of any construction work thereon
or any use of such REO Property in a trade or business conducted by
the REMIC other than through an Independent Contractor; provided,
however, that the Trustee (or the Servicer on behalf of the
Trustee) shall not be considered to Directly Operate an REO
Property solely because the Trustee (or the Servicer on behalf of
the Trustee) establishes rental terms, chooses tenants, enters into
or renews leases, deals with taxes and insurance, or makes
decisions as to repairs or capital expenditures with respect to
such REO Property.
“Disqualified
Organization”: A “disqualified organization”
under Section 860E of the Code, which as of the Closing Date is any
of: (i) the United States, any state or political subdivision
thereof, any foreign government, any international organization, or
any agency or instrumentality of any of the foregoing, (ii) any
organization (other than a cooperative described in Section 521 of
the Code) which is exempt from the tax imposed by Chapter 1 of the
Code unless such organization is subject to the tax imposed by
Section 511 of the Code, (iii) any organization described in
Section 1381(a)(2)(C) of the Code or (iv) an “electing large
partnership” within the meaning of Section 775 of the Code. A
corporation will not be treated as an instrumentality of the United
States or of any state or political subdivision thereof, if all of
its activities are subject to tax and, a majority of its board of
directors is not selected by a governmental unit. The term
“United States”, “state” and
“international organizations” shall have the meanings
set forth in Section 7701 of the Code.
“Distribution Account”:
The segregated trust account or accounts created and maintained by
the Trustee pursuant to Section 3.10(b) which shall be entitled
“Distribution Account, Deutsche Bank National Trust Company,
as Trustee, in trust for the registered Certificateholders of
Meritage Mortgage Loan Trust 2005-3, Asset-Backed Certificates,
Series 2005-3” and which must be an Eligible
Account.
“Distribution Date”: The
25 th day of any calendar month, or if such 25
th day is not a Business Day, the Business Day
immediately following such 25 th day, commencing in
December 2005.
“Due Date”: With respect
to each Mortgage Loan and any Distribution Date, the day of the
calendar month in which such Distribution Date occurs on which the
Monthly Payment for such Mortgage Loan was due (or, in the case of
any Mortgage Loan under the terms of which the Monthly Payment for
such Mortgage Loan was due on a day other than the first day of the
calendar month in which such Distribution Date occurs, the day
during the related Due Period on which such Monthly Payment was
due), exclusive of any days of grace.
“Due Period”: With
respect to any Distribution Date, the period commencing on the
second day of the month preceding the month in which such
Distribution Date occurs and ending on the first day of the month
in which such Distribution Date occurs.
“Eligible Account”: Any
of (i) an account or accounts maintained with a federal or state
chartered depository institution or trust company the short-term
unsecured debt obligations of which (or, in the case of a
depository institution or trust company that is the
principal subsidiary of a holding
company, the short-term unsecured debt obligations of such holding
company) are rated A-1 by S&P, F-1 by Fitch and P-1 by
Moody’s (or comparable ratings if S&P, Fitch and
Moody’s are not the Rating Agencies) at the time any amounts
are held on deposit therein, (ii) an account or accounts the
deposits in which are fully insured by the FDIC (to the limits
established by such corporation), the uninsured deposits in which
account are otherwise secured such that, as evidenced by an Opinion
of Counsel delivered to the Trustee and to each Rating Agency, the
Certificateholders will have a claim with respect to the funds in
such account or a perfected first priority security interest
against such 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, (iii) a trust account or accounts
maintained with the trust department of a federal or state
chartered depository institution, national banking association or
trust company acting in its fiduciary capacity or (iv) an account
otherwise acceptable to each Rating Agency without reduction or
withdrawal of their then current ratings of the Certificates as
evidenced by a letter from each Rating Agency to the Trustee.
Eligible Accounts may bear interest.
“ERISA”: The Employee
Retirement Income Security Act of 1974, as amended.
“Escrow Account”: The
account or accounts created and maintained pursuant to Section
3.09.
“Escrow Payments”: The
amounts constituting ground rents, taxes, assessments, water rates,
fire and hazard insurance premiums and other payments required to
be escrowed by the Mortgagor with the mortgagee pursuant to any
Mortgage Loan.
“Excess Overcollateralized
Amount”: With respect to the Class A Certificates, the
Mezzanine Certificates and the Class B Certificates and any
Distribution Date, the excess, if any, of (i) the
Overcollateralized Amount for such Distribution Date, assuming that
100% of the Principal Remittance Amount is applied as a principal
payment on such Distribution Date over (ii) the
Overcollateralization Target Amount for such Distribution
Date.
“Extra Principal Distribution
Amount”: With respect to any Distribution Date, the lesser of
(x) the Monthly Interest Distributable Amount payable on the Class
C Certificates on such Distribution Date as reduced by Realized
Losses allocated thereto with respect to such Distribution Date
pursuant to Section 4.08 and (y) the Overcollateralization
Deficiency Amount for such Distribution Date.
“Fannie Mae”: Federal
National Mortgage Association or any successor thereto.
“FDIC”: Federal Deposit
Insurance Corporation or any successor thereto.
“Final Recovery
Determination”: With respect to any defaulted Mortgage Loan
or any REO Property (other than a Mortgage Loan or REO Property
purchased by the Seller, the Originator or the Servicer pursuant to
or as contemplated by Section 2.03, 3.16(c) or 10.01), a
determination made by the Servicer that all Insurance Proceeds, Net
Liquidation Proceeds and other payments or recoveries which the
Servicer, in its reasonable good faith judgment, expects to be
finally recoverable in respect thereof have been so recovered. The
Servicer shall maintain records, prepared by a Servicing Officer,
of each Final Recovery Determination made thereby.
“Fitch”: Fitch Ratings,
or its successor in interest.
“Fixed-Rate Mortgage
Loan”: A first or second lien Mortgage Loan which provides
for a fixed Mortgage Rate payable with respect thereto.
“Fixed Rate
Certificates”: The Class A Certificates and the Class B-1
Certificates.
“Floating Rate
Certificates”: The Mezzanine Certificates and the Class B-2
Certificates.
“Formula Rate”: For any
Distribution Date and the Floating Rate Certificates, the lesser of
(i) the Base Rate and (ii) the Maximum Cap Rate.
“Freddie Mac”: The
Federal Home Loan Mortgage Corporation, or any successor
thereto.
“Funding Period”: The
period beginning on the Closing Date and ending on the earlier to
occur of the date upon which (i) the amount on deposit in the
Pre-Funding Account (exclusive of any investment income therein)
has been reduced to $10,000 or less or (ii) February 18,
2006.
“Gross Margin”: With
respect to each Adjustable-Rate Mortgage Loan, the fixed percentage
set forth in the related Mortgage Note that is added to the Index
on each Adjustment Date in accordance with the terms of the related
Mortgage Note used to determine the Mortgage Rate for such
Adjustable-Rate Mortgage Loan.
“Highest Priority”: As
of any date of determination, the Class of Mezzanine Certificates
or Class B Certificates then outstanding with a Certificate
Principal Balance greater than zero, with the highest priority for
payments pursuant to Section 4.01, in the following order: Class
M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class
M-7, Class M-8, Class M-9, Class B-1 and Class B-2
Certificates.
“Indenture”: An
indenture relating to the issuance of notes secured by the Class C
Certificates, the Class P Certificates and/or the Class R
Certificates (or any portion thereof).
“Independent”: When used
with respect to any specified Person, any such Person who (a) is in
fact independent of the Depositor, the Servicer and their
respective Affiliates, (b) does not have any direct financial
interest in or any material indirect financial interest in the
Depositor or the Servicer or any Affiliate thereof, and (c) is not
connected with the Depositor or the Servicer or any Affiliate
thereof as an officer, employee, promoter, underwriter, trustee,
partner, director or Person performing similar functions; provided,
however, that a Person shall not fail to be Independent of the
Depositor or the Servicer or any Affiliate thereof merely because
such Person is the beneficial owner of 1% or less of any class of
securities issued by the Depositor or the Servicer or any Affiliate
thereof, as the case may be.
“Independent
Contractor”: Either (i) any Person (other than the Servicer)
that would be an “independent contractor” with respect
to any of the REMICs created hereunder
within the meaning of Section
856(d)(3) of the Code if such REMIC were a real estate investment
trust (except that the ownership tests set forth in that section
shall be considered to be met by any Person that owns, directly or
indirectly, 35% or more of any Class of Certificates), so long as
each such REMIC does not receive or derive any income from such
Person and provided that the relationship between such Person and
such REMIC is at arm’s length, all within the meaning of
Treasury Regulation Section 1.856-4(b)(5), or (ii) any other Person
(including the Servicer) if the Trustee has received an Opinion of
Counsel to the effect that the taking of any action in respect of
any REO Property by such Person, subject to any conditions therein
specified, that is otherwise herein contemplated to be taken by an
Independent Contractor will not cause such REO Property to cease to
qualify as “foreclosure property” within the meaning of
Section 860G(a)(8) of the Code (determined without regard to the
exception applicable for purposes of Section 860D(a) of the Code),
or cause any income realized in respect of such REO Property to
fail to qualify as Rents from Real Property.
“Index”: With respect to
each Adjustable-Rate Mortgage Loan and with respect to each related
Adjustment Date, the index as specified in the related Mortgage
Note.
“Initial Certificate Principal
Balance”: With respect to any Regular Certificate, the amount
designated “Initial Certificate Principal Balance” on
the face thereof.
“Initial Mortgage Loan”:
Any of the Mortgage Loans included in the Trust Fund as of the
Closing Date. The aggregate principal balance of the Initial
Mortgage Loans as of the Cut-off Date is equal to
$515,098,376.74.
“Insurance Proceeds”:
Proceeds of any title policy, hazard policy or other insurance
policy covering a Mortgage Loan, to the extent such proceeds are
received by the Servicer and are not to be applied to the
restoration of the related Mortgaged Property or released to the
Mortgagor in accordance with the procedures that the Servicer would
follow in servicing mortgage loans held for its own account,
subject to the terms and conditions of the related Mortgage Note
and Mortgage.
“Interest Coverage
Account”: The account established and maintained pursuant to
Section 4.06, which account contains an amount, to be paid by the
Depositor to the Trustee on the Closing Date, that equals
$0.00.
“Interest Determination
Date”: With respect to the Floating Rate Certificates and
each Accrual Period, the second LIBOR Business Day preceding the
commencement of such Accrual Period.
“Interest Remittance
Amount”: With respect to any Distribution Date, that portion
of the Available Funds for such Distribution Date attributable to
interest received or advanced with respect to the Mortgage Loans or
amounts withdrawn from the Interest Coverage Account.
“Late Collections”: With
respect to any Mortgage Loan, all amounts received subsequent to
the Determination Date immediately following any related Due
Period, whether as late payments of Monthly Payments or as
Insurance Proceeds, Liquidation Proceeds or otherwise, which
represent late payments or collections of principal and/or interest
due (without
regard to any acceleration of
payments under the related Mortgage and Mortgage Note) but
delinquent on a contractual basis for such Due Period and not
previously recovered.
“LIBOR”: With respect to
each Accrual Period, the rate determined by the Trustee on the
related Interest Determination Date on the basis of the London
interbank offered rate for one-month United States dollar deposits,
as such rate appears on the Telerate Page 3750, as of 11:00 a.m.
(London time) on such Interest Determination Date. If such rate
does not appear on Telerate Page 3750, the rate for such Interest
Determination Date will be determined on the basis of the offered
rates of the Reference Banks for one-month United States dollar
deposits, as of 11:00 a.m. (London time) on such Interest
Determination Date. The Trustee will request the principal London
office of each of the Reference Banks to provide a quotation of its
rate. On such Interest Determination Date, LIBOR for the related
Accrual Period will be established by the Trustee as
follows:
(i) If
on such Interest Determination Date two or more Reference Banks
provide such offered quotations, 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 1/16
of 1%); and
(ii) If
on such Interest Determination Date fewer than two Reference Banks
provide such offered quotations, LIBOR for the related Accrual
Period shall be the higher of (i) LIBOR as determined on the
previous Interest Determination Date and (ii) the Reserve Interest
Rate.
“LIBOR Business Day”:
Any day on which banks in London, England and The City of New York
are open and conducting transactions in foreign currency and
exchange.
“Liquidated Mortgage
Loan”: As to any Distribution Date, any Mortgage Loan in
respect of which the Servicer has determined, in its reasonable
judgment, as of the end of the related Prepayment Period, that all
Liquidation Proceeds which it expects to recover with respect to
the liquidation of the Mortgage Loan or disposition of the related
REO Property have been recovered.
“Liquidation Event”:
With respect to any Mortgage Loan, any of the following events: (i)
such Mortgage Loan is paid in full, (ii) a Final Recovery
Determination is made as to such Mortgage Loan or (iii) such
Mortgage Loan is removed from the Trust Fund by reason of its being
purchased, sold or replaced pursuant to or as contemplated by
Section 2.03, Section 3.16(c) or Section 10.01. With respect to any
REO Property, either of the following events: (i) a Final Recovery
Determination is made as to such REO Property or (ii) such REO
Property is removed from the Trust Fund by reason of its being sold
or purchased pursuant to Section 3.23 or Section 10.01.
“Liquidation Proceeds”:
The amount (other than amounts received in respect of the rental of
any REO Property prior to REO Disposition) received by the Servicer
in connection with (i) the taking of all or a part of a Mortgaged
Property by exercise of the power of eminent domain or
condemnation, (ii) the liquidation of a defaulted Mortgage Loan by
means of a trustee’s sale, foreclosure sale or otherwise or
(iii) the repurchase, substitution or sale of a
Mortgage Loan or an REO Property
pursuant to or as contemplated by Section 2.03, Section 3.16(c),
Section 3.23 or Section 10.01.
“Loan-to-Value Ratio”:
As of any date and as to any Mortgage Loan, the fraction, expressed
as a percentage, the numerator of which is the Stated Principal
Balance of the Mortgage Loan and the denominator of which is the
Value of the related Mortgaged Property.
“Lockout Certificate
Percentage”: With respect to the Class A-5 Certificates and
any Distribution Date, a percentage equal to the Certificate
Principal Balance of the Class A-5 Certificates immediately prior
to such Distribution Date divided by the aggregate Certificate
Principal Balance of the Class A Certificates immediately prior to
such Distribution Date.
“Lockout Distribution
Percentage”: With respect to the Class A-5 Certificates and
any Distribution Date, the indicated percentage of the Lockout
Certificate Percentage for such Distribution Date:
|
Distribution Date Occurring
In
|
Percentage
|
|
December 2005 through November 2008
|
0%
|
|
December 2008 through November 2010
|
45%
|
|
December 2010 through November 2011
|
80%
|
|
December 2011 through November 2012
|
100%
|
|
December 2012 and thereafter
|
300%
|
“Losses”: As defined in
Section 9.03.
“Lost Note Affidavit”:
With respect to any Mortgage Loan as to which the original Mortgage
Note has been permanently lost, misplaced or destroyed and has not
been replaced, an affidavit from the Originator certifying that the
original Mortgage Note has been lost, misplaced or destroyed
(together with a copy of the related Mortgage Note) and
indemnifying the Trust against any loss, cost or liability
resulting from the failure to deliver the original Mortgage Note in
the form of Exhibit H hereto.
“Majority
Certificateholders”: The Holders of Certificates evidencing
at least 51% of the Voting Rights.
“Marker Rate”: With
respect to the Class C Interest and any Distribution Date, a per
annum rate equal to two (2) times the weighted average of the
Uncertificated REMIC 2 Pass-Through Rates for REMIC 2 Regular
Interest LTA1, REMIC 2 Regular Interest LTA2, REMIC 2 Regular
Interest LTA3, REMIC 2 Regular Interest LTA4, REMIC 2 Regular
Interest LTA5, REMIC 2 Regular Interest LTM1, REMIC 2 Regular
Interest LTM2, REMIC 2 Regular Interest LTM3, REMIC 2 Regular
Interest LTM4, REMIC 2 Regular Interest LTM5, REMIC 2 Regular
Interest LTM6, REMIC 2 Regular Interest LTM7, REMIC 2 Regular
Interest LTM8, REMIC 2 Regular Interest LTM9, REMIC 2 Regular
Interest LTB1, REMIC 2 Regular Interest LTB2 and REMIC 2 Regular
Interest LTZZ, with the rate on each such REMIC 2 Regular Interest
(other than REMIC 2 Regular Interest LTZZ) subject to a cap equal
to the lesser of (i) the Pass-Through Rate for the related
Corresponding Certificate (without regard to the Net WAC Rate) and
(ii) the Net WAC Rate for the purpose of this calculation; and with
the rate on REMIC 2 Regular Interest LTZZ subject to a cap of zero
for the purpose of this calculation; provided,
however, that for this purpose,
calculations of the Uncertificated REMIC 2 Pass-Through Rate and
the related caps with respect to REMIC 2 Regular Interest LTM1,
REMIC 2 Regular Interest LTM2, REMIC 2 Regular Interest LTM3, REMIC
2 Regular Interest LTM4, REMIC 2 Regular Interest LTM5, REMIC 2
Regular Interest LTM6, REMIC 2 Regular Interest LTM7, REMIC 2
Regular Interest LTM8, REMIC 2 Regular Interest LTM9 and REMIC 2
Regular Interest LTB2 shall be multiplied by a fraction, the
numerator of which is the actual number of days elapsed in the
related Accrual Period and the denominator of which is
30.
“Maximum Cap Rate”: For
any Distribution Date, a per annum rate equal to the product of (x)
the weighted average of the Adjusted Net Maximum Mortgage Rates of
the Mortgage Loans, weighted on the basis of the outstanding Stated
Principal Balances of the Mortgage Loans as of the first day of the
month preceding the month of such Distribution Date and (y) a
fraction, the numerator of which is 30 and the denominator of which
is the actual number of days elapsed in the related Accrual
Period.
“Maximum Uncertificated
Accrued Interest Deferral Amount”: With respect to any
Distribution Date, the excess of (a) accrued interest at the
Uncertificated REMIC 2 Pass-Through Rate applicable to REMIC 2
Regular Interest LTZZ for such Distribution Date on a balance equal
to the Uncertificated Principal Balance of REMIC 2 Regular Interest
LTZZ minus the REMIC 2 Overcollateralization Amount, in each case
for such Distribution Date, over (b) the sum of the Uncertificated
Accrued Interest on REMIC 2 Regular Interest LTA1, REMIC 2 Regular
Interest LTA2, REMIC 2 Regular Interest LTA3, REMIC 2 Regular
Interest LTA4, REMIC 2 Regular Interest LTA5, REMIC 2 Regular
Interest LTM1, REMIC 2 Regular Interest LTM2, REMIC 2 Regular
Interest LTM3, REMIC 2 Regular Interest LTM4, REMIC 2 Regular
Interest LTM5, REMIC 2 Regular Interest LTM6, REMIC 2 Regular
Interest LTM7, REMIC 2 Regular Interest LTM8, REMIC 2 Regular
Interest LTM9, REMIC 2 Regular Interest LTB1 and REMIC 2 Regular
Interest LTB2 with the rate on each such REMIC 2 Regular Interest
subject to a cap equal to the lesser of (i) the Pass-Through Rate
for the related Corresponding Certificate (without regard to the
Net WAC Rate) and (ii) the Net WAC Rate for the purpose of this
calculation; provided, however, that for this purpose, calculations
of the Uncertificated REMIC 2 Pass-Through Rate and the related
caps with respect to REMIC 2 Regular Interest LTM1, REMIC 2 Regular
Interest LTM2, REMIC 2 Regular Interest LTM3, REMIC 2 Regular
Interest LTM4, REMIC 2 Regular Interest LTM5, REMIC 2 Regular
Interest LTM6, REMIC 2 Regular Interest LTM7, REMIC 2 Regular
Interest LTM8, REMIC 2 Regular Interest LTM9 and REMIC 2 Regular
Interest LTB2 shall be multiplied by a fraction, the numerator of
which is the actual number of days elapsed in the related Accrual
Period and the denominator of which is 30.
“Maximum Mortgage Rate”:
With respect to each Adjustable-Rate Mortgage Loan, the percentage
set forth in the related Mortgage Note as the maximum Mortgage Rate
thereunder.
“MERS”: Mortgage
Electronic Registration Systems, Inc., a corporation organized and
existing under the laws of the State of Delaware, or any successor
thereto.
“MERS® System”: The
system of recording transfers of Mortgages electronically
maintained by MERS.
“Mezzanine Certificate”:
Any Class M-1 Certificate, Class M-2 Certificate, Class M-3
Certificate, Class M-4 Certificate, Class M-5 Certificate, Class
M-6 Certificate, Class M-7 Certificate, Class M-8 Certificate or
Class M-9 Certificate.
“MIN”: The Mortgage
Identification Number for Mortgage Loans registered with MERS on
the MERS® System.
“Minimum Mortgage Rate”:
With respect to each Adjustable-Rate Mortgage Loan, the percentage
set forth in the related Mortgage Note as the minimum Mortgage Rate
thereunder.
“MOM Loan”: MERS acting
as the mortgagee of such Mortgage Loan, solely as nominee for the
originator of such Mortgage Loan and its successors and assigns, at
the origination thereof.
“Monthly Interest
Distributable Amount”: With respect to the Class A
Certificates, the Mezzanine Certificates, the Class B Certificates
and the Class C Certificates and any Distribution Date, the amount
of interest accrued during the related Accrual Period at the
related Pass-Through Rate on the Certificate Principal Balance (or
at the related Pass-Through Rate in the case of the Class C
Certificates) of such Class immediately prior to such Distribution
Date, in each case, reduced by any Net Prepayment Interest
Shortfalls and Relief Act Interest Shortfalls allocated to such
Certificate as provided in Section 1.03.
“Monthly Payment”: With
respect to any Mortgage Loan, the scheduled monthly payment of
principal and interest on such Mortgage Loan which is payable by
the related Mortgagor from time to time under the related Mortgage
Note, determined: (a) after giving effect to (i) any Deficient
Valuation and/or Debt Service Reduction with respect to such
Mortgage Loan and (ii) any reduction in the amount of interest
collectible from the related Mortgagor pursuant to the Relief Act;
(b) without giving effect to any extension granted or agreed to by
the Servicer pursuant to Section 3.07; and (c) on the assumption
that all other amounts, if any, due under such Mortgage Loan are
paid when due.
“Moody’s”:
Moody’s Investors Service, Inc., or its successor in
interest.
“Mortgage”: The
mortgage, deed of trust or other instrument creating a first or
second lien on, or first or second priority security interest in, a
Mortgaged Property securing a Mortgage Note.
“Mortgage File”: The
mortgage documents listed in Section 2.01 pertaining to a
particular Mortgage Loan and any additional documents required to
be added to the Mortgage File pursuant to this
Agreement.
“Mortgage Loan”: Each
mortgage loan transferred and assigned to the Trustee pursuant to
Section 2.01 or Section 2.03(d) as from time to time held as a part
of the Trust Fund, the Mortgage Loans so held being identified in
the Mortgage Loan Schedule.
“Mortgage Loan Purchase
Agreement”: The agreement among the Originator, the Seller
and the Depositor, regarding the transfer of the Mortgage Loans by
the Seller to or at the direction of the Depositor, substantially
in the form attached hereto as Exhibit C.
“Mortgage Loan
Schedule”: As of any date, the list of Mortgage Loans
included in REMIC 1 on such date, separately identifying the
Mortgage Loans, attached hereto as Exhibit D, as supplemented by
each schedule of Subsequent Mortgage Loans. The Mortgage Loan
Schedule shall be prepared by the Seller and shall set forth the
following information with respect to each Mortgage Loan, as
applicable:
|
|
(1)
|
the Mortgage Loan identifying
number;
|
|
|
|
(2)
|
[reserved];
|
|
|
|
(3)
|
the state and zip code of the
Mortgaged Property;
|
|
|
|
|
|
|
(4) a
code indicating whether the Mortgaged Property was represented by
the borrower, at the time of origination, as being
owner-occupied;
|
|
(5)
|
the type of Residential Dwelling
constituting the Mortgaged Property;
|
|
|
(6)
|
the original months to
maturity;
|
|
(7) the
stated remaining months to maturity from the Cut-off Date (or
Subsequent Cut-off Date, with respect to a Subsequent Mortgage
Loan) based on the original amortization schedule;
|
|
(8)
|
the Loan-to-Value Ratio at
origination;
|
(9) the
Mortgage Rate in effect immediately following the Cut-off Date (or
Subsequent Cut-off Date, with respect to a Subsequent Mortgage
Loan);
(10) the
date on which the first Monthly Payment was due on the Mortgage
Loan;
|
|
(11)
|
the stated maturity date;
|
|
|
|
(12)
|
the amount of the Monthly Payment at
origination;
|
(13) the
amount of the Monthly Payment due on the first Due Date after the
Cut- off Date (or Subsequent Cut-off Date, with respect to a
Subsequent Mortgage Loan);
(14) the
last Due Date on which a Monthly Payment was actually applied to
the unpaid Stated Principal Balance;
|
|
(15)
|
the original principal amount of the
Mortgage Loan;
|
(16) the
Stated Principal Balance of the Mortgage Loan as of the Close of
Business on the Cut-off Date (or Subsequent Cut-off Date, with
respect to a Subsequent Mortgage Loan);
(17) a
code indicating the purpose of the Mortgage Loan (i.e., purchase
financing, rate/term refinancing, cash-out refinancing);
|
|
(18)
|
the Mortgage Rate at
origination;
|
(19) a
code indicating the documentation program (i.e., full
documentation, limited income verification, no income verification,
alternative income verification);
|
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(20)
|
the risk grade;
|
|
|
|
(21)
|
the Value of the Mortgaged
Property;
|
|
|
|
(22)
|
the sale price of the Mortgaged
Property, if applicable;
|
|
|
|
|
|
|
(23) the
actual unpaid Stated Principal Balance of the Mortgage Loan as of
the Cut-off Date (or Subsequent Cut-off Date, with respect to a
Subsequent Mortgage Loan);
|
|
(24)
|
the type and term of the related
Prepayment Charge;
|
(25) with
respect to any Adjustable-Rate Mortgage Loan, the rounding code,
the minimum Mortgage Rate, the maximum Mortgage Rate, the Gross
Margin, the next Adjustment Date and the Periodic Rate Cap;
and
The Mortgage Loan Schedule shall set
forth the following information, with respect to the Mortgage Loans
in the aggregate as of the Cut-off Date (or Subsequent Cut-off
Date, with respect to a Subsequent Mortgage Loan): (1) the number
of Mortgage Loans; (2) the current Stated Principal Balance of the
Mortgage Loans; (3) the weighted average Mortgage Rate of the
Mortgage Loans and (4) the weighted average remaining term to
maturity of the Mortgage Loans. The Mortgage Loan Schedule shall be
amended from time to time by the Servicer in accordance with the
provisions of this Agreement. With respect to any Qualified
Substitute Mortgage Loan, Cut-off Date shall refer to the related
Cut-off Date for such Mortgage Loan, determined in accordance with
the definition of Cut-off Date herein.
“Mortgage Note”: The
original executed note or other evidence of indebtedness evidencing
the indebtedness of a Mortgagor under a Mortgage Loan.
“Mortgage Pool”: The
pool of Mortgage Loans, identified on Exhibit D from time to time,
and any REO Properties acquired in respect thereof and as
supplemented by any Subsequent Mortgage Loans identified on each
schedule of Subsequent Mortgage Loans attached to a Subsequent
Transfer Instrument.
“Mortgage Rate”: With
respect to each Fixed-Rate Mortgage Loan, the rate set forth in the
related Mortgage Note. With respect to each Adjustable-Rate
Mortgage Loan, the annual rate at which interest accrues on such
Mortgage Loan from time to time in accordance with the provisions
of the related Mortgage Note, which rate (A) as of any date of
determination until the first Adjustment Date following the Cut-off
Date (or Subsequent Cut-off Date, with respect to a Subsequent
Mortgage Loan) shall be the rate set forth in the Mortgage Loan
Schedule as the Mortgage Rate in effect immediately following the
Cut-off Date (or Subsequent Cut-off Date, with respect to a
Subsequent Mortgage Loan) and (B) as of any date of determination
thereafter shall be the rate as adjusted on the most recent
Adjustment Date, to equal the sum, rounded to the next highest or
nearest 0.125% (as provided in the Mortgage Note), of the Index,
determined as set forth in the related Mortgage Note, plus the
related Gross Margin subject to the limitations set forth in the
related Mortgage Note. With respect to each Mortgage Loan that
becomes an REO Property, as of any date of determination, the
annual rate determined in accordance with the immediately preceding
sentence as of the date such Mortgage Loan became an REO
Property.
“Mortgaged Property”:
The underlying property securing a Mortgage Loan, including any REO
Property, consisting of a fee simple estate in a parcel of real
property improved by a Residential Dwelling.
“Mortgagor”: The obligor
on a Mortgage Note.
“Net Liquidation
Proceeds”: With respect to any Liquidated Mortgage Loan or
any other disposition of related Mortgaged Property (including REO
Property), the related Liquidation Proceeds and Insurance Proceeds
net of Advances, Servicing Advances, Servicing Fees and any other
accrued and unpaid servicing fees or ancillary income received and
retained in connection with the liquidation of such Mortgage Loan
or Mortgaged Property.
“Net Monthly Excess
Cashflow”: With respect to each Distribution Date, the sum of
(a) any Overcollateralization Release Amount for such Distribution
Date and (b) the excess of (x) Available Funds for such
Distribution Date over (y) the sum for such Distribution Date of
(A) the Monthly Interest Distributable Amounts for the Class A
Certificates, the Mezzanine Certificates and the Class B
Certificates, (B) the Unpaid Interest Shortfall Amounts for the
Class A Certificates and (C) the Principal Remittance
Amount.
“Net Mortgage Rate”:
With respect to any Mortgage Loan (or the related REO Property), as
of any date of determination, a per annum rate of interest equal to
the then applicable Mortgage Rate for such Mortgage Loan minus the
Servicing Fee Rate.
“Net Prepayment Interest
Shortfall”: With respect to any Distribution Date, the
excess, if any, of any Prepayment Interest Shortfalls for such date
over the related Compensating Interest.
“Net WAC Rate”: For any
Distribution Date and the Floating Rate Certificates, a per annum
rate equal to the product of (1) (a) a fraction, expressed as a
percentage, the numerator of which is the amount of interest which
accrued on the Mortgage Loans in the prior calendar month for such
Distribution Date minus the sum of the Trustee Fee and the
aggregate
Servicing Fees accrued for the
Mortgage Loans and the denominator of which is the sum of (i) the
aggregate Principal Balance of the Mortgage Loans as of the first
day of the month preceding the month of such Distribution Date (or
as of the Cut-off Date with respect to the first Distribution Date)
and (ii) any amounts on deposit in the Pre-Funding Account and (b)
12 and (2) 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 any Distribution Date and the
Fixed Rate Certificates, a per annum rate equal to the product of
(a) a fraction, expressed as a percentage, the numerator of which
is the amount of interest which accrued on the Mortgage Loans in
the prior calendar month for such Distribution Date minus the
aggregate Servicing Fees accrued for the Mortgage Loans and the
denominator of which is the sum of (i) the aggregate Principal
Balance of the Mortgage Loans as of the first day of the month
preceding the month of such Distribution Date (or as of the Cut-off
Date with respect to the first Distribution Date) and (ii) any
amounts on deposit in the Pre-Funding Account and (b)
12.
For federal income tax purposes, the
economic equivalent of such rate shall be expressed as the weighted
average of the Uncertificated REMIC 2 Pass-Through Rates on the
REMIC 2 Regular Interests, weighted on the basis of the
Uncertificated Principal Balances of such REMIC 2 Regular
Interests.
“Net WAC Rate Carryover
Amount”: With respect to the Class A Certificates, the
Mezzanine Certificates and the Class B Certificates and any
Distribution Date, the sum of (A) the positive excess of (i) the
amount of interest accrued on such Class of Certificates on such
Distribution Date calculated at the related Pass-Through Rate
(without regard to the Net WAC Rate), over (ii) the amount of
interest accrued on such Class of Certificates at the Net WAC Rate
for such Distribution Date and (B) the Net WAC Rate Carryover
Amount for the previous Distribution Date not previously paid,
together with interest thereon at a rate equal to the related
Pass-Through Rate (without regard to the Net WAC Rate) for such
Class of Certificates for such Distribution Date and for such
Accrual Period.
“Net WAC Rate Carryover
Reserve Account”: The account established and maintained
pursuant to Section 4.06.
“New Lease”: Any lease
of REO Property entered into on behalf of the Trust, including any
lease renewed or extended on behalf of the Trust if the Trust has
the right to renegotiate the terms of such lease.
“Nonrecoverable
Advance”: Any Advance or Servicing Advance previously made or
proposed to be made in respect of a Mortgage Loan or REO Property
that, in the good faith business judgment of the Servicer, will not
be ultimately recoverable from Late Collections, Insurance
Proceeds, Liquidation Proceeds or condemnation proceeds of such
Mortgage Loan or REO Property as provided herein.
“Notional Amount”:
Immediately prior to any Distribution Date with respect to the
Class C Interest, the aggregate Uncertificated Principal Balance of
the REMIC 2 Regular Interests (other than REMIC 2 Regular Interest
LTP).
“Officers’
Certificate”: A certificate signed by the Chairman of the
Board, the Vice Chairman of the Board, the President or a vice
president (however denominated), and by the Treasurer, the
Secretary, or one of the assistant treasurers or assistant
secretaries of the Servicer, the Seller or the Depositor, as
applicable.
“Opinion of Counsel”: A
written opinion of counsel, who may, without limitation, be a
salaried counsel for the Depositor or the Servicer, acceptable to
the Trustee, except that any opinion of counsel relating to (a) the
qualification of any REMIC as a REMIC or (b) compliance with the
REMIC Provisions must be an opinion of Independent
counsel.
“Optional Termination
Date”: The first Distribution Date on which the Terminator
may opt to terminate the Trust Fund pursuant to Section
10.01.
“Original Class Certificate
Principal Balance”: With respect to the Regular Certificates,
the Class C Interest and the Class P Interest, the corresponding
amounts set forth opposite such Class above in the Preliminary
Statement.
“Original Pre-Funded
Amount”: The amount deposited by the Depositor in the
Pre-Funding Account on the Closing Date, which amount is
$54,601,623.26.
“Original Notional
Amount”: With respect to the Class C Interest,
$569,699,900.00.
“Originator”: Meritage
Mortgage Corporation, an Oregon corporation, or its successor in
interest.
“Overcollateralization
Deficiency Amount”: With respect to any Distribution Date,
the amount, if any, by which the Overcollateralization Target
Amount exceeds the Overcollateralized Amount on such Distribution
Date (assuming that 100% of the Principal Remittance Amount is
applied as a principal distribution on such Distribution
Date).
“Overcollateralization
Floor”: With respect to the Class A Certificates, the
Mezzanine Certificates and the Class B Certificates,
$2,848,500.
“Overcollateralization Release
Amount”: With respect to any Distribution Date, the lesser of
(x) the Principal Remittance Amount for such Distribution Date and
(y) the Excess Overcollateralized Amount.
“Overcollateralization Target
Amount” means, with respect to any Distribution Date, (i)
prior to the Stepdown Date, 2.45% of the sum of the aggregate
Principal Balance of the Initial Mortgage Loans as of the Cut-off
Date and the Original Pre-Funded Amount, (ii) on or after the
Stepdown Date, provided a Trigger Event is not in effect, the
greater of (x) 4.90% of the then current aggregate outstanding
Principal Balance of the Mortgage Loans as of the last day of the
related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received
during the related Prepayment Period) and (y) 0.50% of the sum of
the aggregate Principal Balance of the Initial Mortgage Loans as of
the Cut-off Date and the Original Pre-Funded Amount or (iii) on or
after the Stepdown Date and if a Trigger Event is in effect,
the
Overcollateralization Target Amount
for the immediately preceding Distribution Date (the
“Overcollateralization Floor”). Notwithstanding the
foregoing, on and after any Distribution Date following the
reduction of the aggregate Certificate Principal Balance of the
Fixed Rate Certificates and the Floating Rate Certificates to zero,
the Overcollateralization Target Amount will be zero.
“Overcollateralized
Amount”: For any Distribution Date, the amount equal to (i)
the sum of (a) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after
giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced, and
unscheduled collections of principal received during the related
Prepayment Period) and (b) any funds on deposit in the Pre-Funding
Account as of the related Determination Date (exclusive of any
investment income therein) minus (ii) the sum of the aggregate
Certificate Principal Balance of the Class A Certificates, the
Mezzanine Certificates, the Class B Certificates and the Class P
Certificates as of such Distribution Date after giving effect to
distributions to be made on such Distribution Date.
“Ownership Interest”: As
to any Certificate, any ownership or security interest in such
Certificate, including any interest in such Certificate as the
Holder thereof and any other interest therein, whether direct or
indirect, legal or beneficial, as owner or as pledgee.
“Pass-Through Rate”:
With respect to the Fixed Rate Certificates and any Distribution
Date, the lesser of (x) the related fixed rate per annum set forth
below for such Distribution Date and (y) the Net WAC Rate for such
Distribution Date.
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A-1
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4.7900% per annum
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5.2900% per annum
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A-2
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5.2700% per annum
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5.7700% per annum
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A-3
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5.4950% per annum
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5.9950% per annum
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A-4
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5.8530% per annum
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6.3530% per annum
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A-5
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5.7030% per annum
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6.2030% per annum
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B-1
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7.0000% per annum
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7.5000% per annum
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__________
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(1)
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For the Accrual Period for each
Distribution Date on or prior to the Optional Termination
Date.
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(2)
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For each other Accrual
Period.
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With respect to the Floating Rate
Certificates and any Distribution Date, the lesser of (x) the
related Formula Rate for such Distribution Date and (y) the Net WAC
Rate for such Distribution Date. With respect to the Class C
Interest and any Distribution Date, (i) a per annum rate equal to
the percentage equivalent of a fraction, the numerator of which is
(x) the interest on the Uncertificated Principal Balance of each
REMIC 2 Regular Interest listed in clause (y) below at a rate equal
to the related Uncertificated REMIC 2 Pass-Through Rate minus the
Marker Rate and the denominator of which is (y) the aggregate
Uncertificated Principal Balance of REMIC 2 Regular Interests LTAA,
LTA1, LTA2, LTA3, LTA4, LTA5, LTM1, LTM2, LTM3, LTM4, LTM5, LTM6,
LTM7, LTM8, LTM9, LTB1, LTB2 and LTZZ and (ii) 100% of the interest
on REMIC 2 Regular Interest LTP, expressed as a per annum
rate.
With respect to the Class C
Certificates, 100% of the interest distributable to the Class C
Interest, expressed as a per annum rate.
“Paying Agent”: Any
paying agent appointed pursuant to Section 5.05.
“Percentage Interest”:
With respect to any Certificate (other than a Residual
Certificate), a fraction, expressed as a percentage, the numerator
of which is the Initial Certificate Principal Balance represented
by such Certificate and the denominator of which is the Original
Class Certificate Principal Balance of the related Class. With
respect to a Residual Certificate, the portion of the Class
evidenced thereby, expressed as a percentage, as stated on the face
of such Certificate; provided, however, that the sum of all such
percentages for each such Class totals 100%.
“Periodic Rate Cap”:
With respect to each Adjustable-Rate Mortgage Loan and any
Adjustment Date therefor, the fixed percentage set forth in the
related Mortgage Note, which is the maximum amount by which the
Mortgage Rate for such Mortgage Loan may increase or decrease
(without regard to the Maximum Mortgage Rate or the Minimum
Mortgage Rate) on such Adjustment Date from the Mortgage Rate in
effect immediately prior to such Adjustment Date.
“Permitted Investments”:
Any one or more of the following obligations or securities acquired
at a purchase price of not greater than par, regardless of whether
issued or managed by the Depositor, the Servicer, the Trustee or
any of their respective Affiliates or for which an Affiliate of the
Trustee, serves as an advisor:
(i) direct
obligations of, or obligations fully guaranteed as to timely
payment of principal and interest by, the United States or any
agency or instrumentality thereof, provided such obligations are
backed by the full faith and credit of the United
States;
(ii) (A)
demand and time deposits in, certificates of deposit of,
bankers’ acceptances issued by or federal funds sold by any
depository institution or trust company (including the Trustee or
its agent acting in their respective commercial capacities)
incorporated under the laws of the United States of America or any
state thereof and subject to supervision and examination by federal
and/or state authorities, so long as, at the time of such
investment or contractual commitment providing for such investment,
such depository institution or trust company (or, if the only
Rating Agency is S&P, in the case of the principal depository
institution in a depository institution holding company, debt
obligations of the depository institution holding company) or its
ultimate parent has a short-term uninsured debt rating in one of
the two highest available ratings of Moody’s and the highest
available rating category of Fitch and S&P and provided that
each such investment has an original maturity of no more than 365
days; and provided further that, if the only Rating Agency is
S&P and if the depository or trust company is a principal
subsidiary of a bank holding company and the debt obligations of
such subsidiary are not separately rated, the applicable rating
shall be that of the bank holding company; and, provided further
that, if the original maturity of such short- term obligations of a
domestic branch of a foreign depository institution or trust
company shall exceed 30 days, the short-term rating of such
institution shall be A-1+ in the case of S&P if S&P is the
Rating Agency; and (B) any other demand or time deposit or deposit
which is fully insured by the FDIC;
(iii) repurchase
obligations with a term not to exceed 30 days with respect to any
security described in clause (i) above and entered into with a
depository institution or trust company (acting as principal) rated
F-1+ or higher by Fitch, P-1 by Moody’s and rated A-1+ or
higher by S&P, provided, however, that collateral transferred
pursuant to such repurchase obligation must be of the type
described in clause (i) above and must (A) be valued daily at
current market prices plus accrued interest, (B) pursuant to such
valuation, be equal, at all times, to 105% of the cash transferred
by the Trustee in exchange for such collateral and (C) be delivered
to the Trustee or, if the Trustee is supplying the collateral, an
agent for the Trustee, in such a manner as to accomplish perfection
of a security interest in the collateral by possession of
certificated securities;
(iv) securities
bearing interest or sold at a discount that are issued by any
corporation incorporated under the laws of the United States of
America or any State thereof and that are rated by a Rating Agency
in its highest long-term unsecured rating category at the time of
such investment or contractual commitment providing for such
investment;
(v) commercial
paper (including both non-interest-bearing discount obligations and
interest-bearing obligations payable on demand or on a specified
date not more than 30 days after the date of acquisition thereof)
that is rated by a Rating Agency in its highest short-term
unsecured debt rating available at the time of such
investment;
(vi) units
of money market funds, including those money market funds managed
or advised by the Trustee or its Affiliates, that have been rated
“AAA” by Fitch (if rated by Fitch), “Aaa”
by Moody’s and “AAA” by S&P; and
(vii) if
previously confirmed in writing to the Trustee, any other demand,
money market or time deposit, or any other obligation, security or
investment, as may be acceptable to the Rating Agencies in writing
as a permitted investment of funds backing securities having
ratings equivalent to its highest initial rating of the Class A
Certificates;
provided, that no instrument
described hereunder shall evidence either the right to receive (a)
only interest with respect to the obligations underlying such
instrument or (b) both principal and interest payments derived from
obligations underlying such instrument and the interest and
principal payments with respect to such instrument provide a yield
to maturity at par greater than 120% of the yield to maturity at
par of the underlying obligations.
“Permitted Transferee”:
Any transferee of a Residual Certificate other than a Disqualified
Organization or a non-U.S. Person.
“Person”: Any
individual, corporation, limited liability company, partnership,
joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or
political subdivision thereof.
“Plan”: Any employee
benefit plan or certain other retirement plans and arrangements,
including individual retirement accounts and annuities, Keogh plans
and bank collective investment funds and insurance company general
or separate accounts in which such
plans, accounts or arrangements are
invested, that are subject to ERISA or Section 4975 of the
Code.
“Pool Balance”: As of
any date of determination, the aggregate Stated Principal Balance
of the Mortgage Loans as of such date.
“Pre-Funding Account”:
The account established and maintained pursuant to Section
4.05.
“Prepayment Assumption”:
As defined in the Prospectus Supplement.
“Prepayment Charge”:
With respect to any Mortgage Loan, the charges or premiums, if any,
due in connection with a full or partial Principal Prepayment of
such Mortgage Loan in accordance with the terms thereof (other than
any Servicer Prepayment Charge Payment Amount).
“Prepayment Charge
Schedule”: As of any date, the list of Prepayment Charges on
the Mortgage Loans included in the Trust Fund on such date,
attached hereto as Schedule I (including the Prepayment Charge
Summary attached thereto). The Prepayment Charge Schedule shall set
forth the following information with respect to each Prepayment
Charge:
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(i)
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the Mortgage Loan identifying
number;
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(ii)
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a code indicating the type of
Prepayment Charge;
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(iii)
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the state of origination of the
related Mortgage Loan;
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(iv) the
date on which the first monthly payment was due on the related
Mortgage Loan;
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(v)
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the term of the related Prepayment
Charge; and
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(vi) the
Stated Principal Balance of the related Mortgage Loan as of the
Cut-off Date (or Subsequent Cut-off Date, with respect to a
Subsequent Mortgage Loan).
The Prepayment Charge Schedule shall
be amended from time to time by the Servicer in accordance with the
provisions of this Agreement and a copy of such amended Prepayment
Charge Schedule shall be furnished by the Servicer.
“Prepayment Interest
Excess”: With respect to any Distribution 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 and the 15 th day of the calendar
month in which such Distribution Date occurs, 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 Distribution Date occurs and ending on the date on which such
prepayment is so applied.
“Prepayment Interest
Shortfall”: With respect to any Distribution Date, for each
Mortgage Loan that was the subject of a Principal Prepayment in
full during the portion of the related Prepayment Period occurring
from the first day of the related Prepayment Period through the
last day of the calendar month preceding the month in which such
Distribution Date occurs, an amount equal to interest on the amount
of such Principal Prepayment for the number of days commencing on
the date such Principal Prepayment was applied and ending on the
last day of the calendar month preceding the month in which such
Distribution Date occurs.
“Prepayment Period”:
With respect to any Distribution Date and Principal Prepayments,
the period commencing on the 16 th day of the calendar
month preceding the month in which the related Distribution Date
occurs and ending on the 15 th day of the calendar month
in which such Distribution Date occurs.
“Principal Balance”: As
to any Mortgage Loan other than a Liquidated Mortgage Loan, and any
day, the related Cut-off Date Principal Balance, minus all
collections credited against the Cut-off Date Principal Balance of
any such Mortgage Loan. For purposes of this definition, a
Liquidated Mortgage Loan shall be deemed to have a Principal
Balance equal to the Principal Balance of the related Mortgage Loan
as of the final recovery of related Liquidation Proceeds and a
Principal Balance of zero thereafter. As to any REO Property and
any day, the Principal Balance of the related Mortgage Loan
immediately prior to such Mortgage Loan becoming REO Property minus
any REO Principal Amortization received with respect thereto on or
prior to such day.
“Principal Distribution
Amount”: With respect to any Distribution Date, the sum of
(i) the Basic Principal Distribution Amount for such Distribution
Date and (ii) the Extra Principal Distribution Amount for such
Distribution Date.
“Principal Prepayment”:
Any payment of principal made by the Mortgagor on a Mortgage Loan
which is received in advance of its scheduled Due Date and which is
not accompanied by an amount of interest representing the full
amount of scheduled interest due with respect to such principal on
any Due Date in any month or months subsequent to the month of
prepayment.
“Principal Remittance
Amount”: With respect to any Distribution Date, that portion
of Available Funds equal to the sum of (i) each scheduled payment
of principal collected or advanced on the Mortgage Loans by the
Servicer that was due during the related Due Period, (ii) the
principal portion of all Principal Prepayments of the Mortgage
Loans applied by the Servicer during the related Prepayment Period,
(iii) the principal portion of all related Net Liquidation
Proceeds, Insurance Proceeds and Subsequent Recoveries received
during the related Prepayment Period with respect to the Mortgage
Loans, (iv) that portion of the Purchase Price, representing
principal of any repurchased Mortgage Loan, deposited in the
Collection Account during the related Prepayment Period, (v) the
principal portion of any related Substitution Adjustments deposited
in the Collection Account during the related Prepayment Period with
respect to the Mortgage Loans, (vi) with respect to the
Distribution Date in the month following the end of the Funding
Period, any remainder amount in the Pre-Funding Account (exclusive
of any investment income therein) after giving effect to the
purchase of any Subsequent Mortgage Loans and (vii) on the
Distribution Date on which the Trust Fund is to be terminated
pursuant to
Section 10.01, that portion of the
Termination Price, in respect of principal on the Mortgage
Loans.
“Prospectus Supplement”:
That certain Prospectus Supplement dated November 17, 2005 relating
to the public offering of the Class A Certificates and the
Mezzanine Certificates.
“Purchase Price”: With
respect to any Mortgage Loan or REO Property to be purchased
pursuant to or as contemplated by Section 2.03, Section 3.16(c) or
Section 10.01, and as confirmed by an Officers’ Certificate
from the party purchasing the Mortgage Loan to the Trustee, an
amount equal to the sum of (i) 100% of the Stated Principal Balance
thereof as of the date of purchase (or such other price as provided
in Section 10.01), (ii) in the case of (x) a Mortgage Loan, accrued
interest on such Stated Principal Balance at the applicable
Mortgage Rate in effect from time to time from the Due Date as to
which interest was last covered by a payment by the Mortgagor or an
advance by the Servicer, which payment or advance had as of the
date of purchase been distributed pursuant to Section 4.01, through
the end of the calendar month in which the purchase is to be
effected, and (y) an REO Property, the sum of (1) accrued interest
on such Stated Principal Balance at the applicable Mortgage Rate in
effect from time to time from the Due Date as to which interest was
last covered by a payment by the Mortgagor or an advance by the
Servicer through the end of the calendar month immediately
preceding the calendar month in which such REO Property was
acquired, plus (2) REO Imputed Interest for such REO Property for
each calendar month commencing with the calendar month in which
such REO Property was acquired and ending with the calendar month
in which such purchase is to be effected, net of the total of all
net rental income, Insurance Proceeds, Liquidation Proceeds and
Advances that as of the date of purchase had been distributed as or
to cover REO Imputed Interest pursuant to Section 4.04, (iii) any
unreimbursed Servicing Advances and Advances and any unpaid
Servicing Fees allocable to such Mortgage Loan or REO Property,
(iv) any amounts previously withdrawn from the Collection Account
in respect of such Mortgage Loan or REO Property pursuant to
Section 3.23 and (v) in the case of a Mortgage Loan required to be
purchased pursuant to Section 2.03, expenses reasonably incurred or
to be incurred by the Servicer or the Trustee in respect of the
breach or defect giving rise to the purchase obligation, including
any costs and damages incurred by the Trust Fund in connection with
any violation by such loan of any predatory or abusive lending
law.
“Qualified Insurer”: Any
insurance company acceptable to Fannie Mae.
“Qualified Substitute Mortgage
Loan”: A mortgage loan substituted for a Deleted Mortgage
Loan pursuant to the terms of this Agreement or the Mortgage Loan
Purchase Agreement which must, on the date of such substitution,
(i) have an outstanding Stated Principal Balance (or in the case of
a substitution of more than one mortgage loan for a Deleted
Mortgage Loan, an aggregate Stated Principal Balance), after
application of all scheduled payments of principal and interest due
during or prior to the month of substitution, not in excess of, and
not more than 5% less than, the outstanding Stated Principal
Balance of the Deleted Mortgage Loan as of the Due Date in the
calendar month during which the substitution occurs, (ii) have a
Mortgage Rate not less than (and not more than one percentage point
in excess of) the Mortgage Rate of the Deleted Mortgage Loan, (iii)
if the Qualified Substitute Mortgage Loan is an Adjustable-Rate
Mortgage Loan, have a Maximum Mortgage Rate not less than the
Maximum
Mortgage Rate on the Deleted
Mortgage Loan, (iv) if the Qualified Substitute Mortgage Loan is an
Adjustable-Rate Mortgage Loan, have a Minimum Mortgage Rate not
less than the Minimum Mortgage Rate of the Deleted Mortgage Loan,
(v) if the Qualified Substitute Mortgage Loan is an Adjustable-Rate
Mortgage Loan, have a Gross Margin equal to or greater than the
Gross Margin of the Deleted Mortgage Loan, (vi) if the Qualified
Substitute Mortgage Loan is an Adjustable-Rate Mortgage Loan, have
a next Adjustment Date not more than two months later than the next
Adjustment Date on the Deleted Mortgage Loan, (vii) [reserved],
(viii) have a remaining term to maturity not greater than (and not
more than one year less than) that of the Deleted Mortgage Loan,
(ix) be current as of the date of substitution, (x) have a
Loan-to-Value Ratio as of the date of substitution equal to or
lower than the Loan-to-Value Ratio of the Deleted Mortgage Loan as
of such date, (xi) have a risk grading determined by the Originator
at least equal to the risk grading assigned on the Deleted Mortgage
Loan, (xii) have been underwritten or reunderwritten by the
Originator in accordance with the same underwriting criteria and
guidelines as the Deleted Mortgage Loan, (xiii) [reserved]; and
(xiv) conform to each representation and warranty set forth in
Section 3.01 of the Mortgage Loan Purchase Agreement applicable to
the Deleted Mortgage Loan. In the event that one or more mortgage
loans are substituted for one or more Deleted Mortgage Loans, the
amounts described in clause (i) hereof shall be determined on the
basis of aggregate Stated Principal Balances, the Mortgage Rates
described in clauses (ii) through (vi) hereof shall be satisfied
for each such mortgage loan, the risk gradings described in clause
(x) hereof shall be satisfied as to each such mortgage loan, the
terms described in clause (viii) hereof shall be determined on the
basis of weighted average remaining term to maturity (provided that
no such mortgage loan may have a remaining term to maturity longer
than the Deleted Mortgage Loan), the Loan-to-Value Ratios described
in clause (x) hereof shall be satisfied as to each such mortgage
loan and, except to the extent otherwise provided in this sentence,
the representations and warranties described in clause (xiv) hereof
must be satisfied as to each Qualified Substitute Mortgage Loan or
in the aggregate, as the case may be.
“Rating Agency or Rating
Agencies”: Moody’s, S&P and DBRS or their
successors. If such agencies or their successors are no longer in
existence, “Rating Agencies” shall be such nationally
recognized statistical rating agencies, or other comparable
Persons, designated by the Depositor, notice of which designation
shall be given to the Trustee and Servicer.
“Realized Loss”: With
respect to any Liquidated Mortgage Loan, the amount of loss
realized equal to the portion of the Stated Principal Balance
remaining unpaid after application of all Net Liquidation Proceeds
in respect of such Mortgage Loan. If the Servicer receives
Subsequent Recoveries with respect to any Mortgage Loan, the amount
of the Realized Loss with respect to that Mortgage Loan will be
reduced to the extent such recoveries are applied to principal
distributions on any Distribution Date.
“Record Date”: With
respect to (i) the Fixed Rate Certificates, Class C Certificates
and the Residual Certificates, the Close of Business on the last
Business Day of the calendar month preceding the month in which the
related Distribution Date occurs and (ii) the Floating Rate
Certificates, the Close of Business on the Business Day immediately
preceding the related Distribution Date; provided, however, that
following the date on which Definitive Certificates for any of the
Mezzanine Certificates or the Class B-2 Certificates are
available
pursuant to Section 5.02, the Record
Date for such Certificates that are Definitive Certificates shall
be the last Business Day of the calendar month preceding the month
in which the related Distribution Date occurs.
“Reference Banks”: Those
banks (i) with an established place of business in London, England,
(ii) not controlling, under the control of or under common control
with the Originator or the Servicer or any affiliate thereof and
(iii) which have been designated as such by the Trustee after
consultation with the Depositor; provided, however, that if fewer
than two of such banks provide a LIBOR rate, then any leading banks
selected by the Trustee after consultation with the Depositor which
are engaged in transactions in United States dollar deposits in the
international Eurocurrency market.
“Refinanced Mortgage
Loan”: A Mortgage Loan the proceeds of which were not used to
purchase the related Mortgaged Property.
“Regular Certificate”:
Any of the Class A Certificates, Mezzanine Certificates, Class B
Certificates, Class C Certificates or Class P
Certificates.
“Reimbursement Amount”:
As defined in Section 3.29.
“Relief Act”: The
Servicemembers Civil Relief Act, as amended, or any similar state
or local laws.
“Relief Act Interest
Shortfall”: With respect to any Distribution Date, for any
Mortgage Loan with respect to which there has been a reduction in
the amount of interest collectible thereon for the most recently
ended Due Period as a result of the application of the Relief Act,
the amount by which (i) interest collectible on such Mortgage Loan
during such Due Period is less than (ii) one month’s interest
on the Stated Principal Balance of such Mortgage Loan at the
Mortgage Rate for such Mortgage Loan before giving effect to the
application of the Relief Act.
“REMIC”: A “real
estate mortgage investment conduit” within the meaning of
Section 860D of the Code.
“REMIC 1”: The
segregated pool of assets subject hereto, constituting the primary
trust created hereby and to be administered hereunder, with respect
to which a REMIC election is to be made consisting of: (i) such
Mortgage Loans as from time to time are subject to this Agreement,
together with the Mortgage Files relating thereto, and together
with all collections thereon and proceeds thereof, (ii) any REO
Property, together with all collections thereon and proceeds
thereof, (iii) the Trustee’s rights with respect to the
Mortgage Loans under all insurance policies required to be
maintained pursuant to this Agreement and any proceeds thereof,
(iv) the Depositor’s rights under the Mortgage Loan Purchase
Agreement (including any security interest created thereby) and (v)
the Collection Account, the Distribution Account (subject to the
last sentence of this definition) and any REO Account and such
assets that are deposited therein from time to time and any
investments thereof, together with any and all income, proceeds and
payments with respect thereto. Notwithstanding the foregoing,
however, a REMIC election will not be made with respect to the
Pre-Funding Account, the Interest
Coverage Account, any Subsequent
Mortgage Loan Interest, the Net WAC Rate Carryover Reserve Account,
the Cap Contract or any Servicer Prepayment Charge Payment
Amounts.
“REMIC 1 Regular
Interest”: One of the separate non-certificated beneficial
ownership interests in REMIC 1 issued hereunder and designated as a
Regular Interest in REMIC 1. Each REMIC 1 Regular Interest shall
accrue interest at the related Uncertificated REMIC 1 Pass-Through
Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal Balance as set forth in the Preliminary Statement hereto.
The following is a list of each of the REMIC 1 Regular Interests:
REMIC 1 Regular Interest LT1, REMIC 1 Regular Interest LT1PF and
REMIC 1 Regular Interest LTP.
“REMIC 2”: The
segregated pool of assets consisting of all of the REMIC 1 Regular
Interests and conveyed in trust to the Trustee, for the benefit of
REMIC 3, as holder of the REMIC 2 Regular Interests, and the Class
R Certificateholders, as Holders of the Class R-2 Interest,
pursuant to Article II hereunder, and all amounts deposited
therein, with respect to which a separate REMIC election is to be
made.
“REMIC 2 Interest Loss
Allocation Amount”: With respect to any Distribution Date, an
amount equal to (a) the product of (i) the aggregate Stated
Principal Balance of the Mortgage Loans and related REO Properties
then outstanding and (ii) the Uncertificated REMIC 2 Pass-Through
Rate for REMIC 2 Regular Interest LTAA minus the Marker Rate,
divided by (b) 12.
“REMIC 2 Overcollateralization
Target Amount”: 1.00% of the Overcollateralization Target
Amount.
“REMIC 2 Overcollateralization
Amount”: With respect to any date of determination, (i) 1.00%
of the aggregate Uncertificated Principal Balance of the REMIC 2
Regular Interests minus (ii) the aggregate Uncertificated Principal
Balance of REMIC 2 Regular Interest LTA1, REMIC 2 Regular Interest
LTA2, REMIC 2 Regular Interest LTA3, REMIC 2 Regular Interest LTA4,
REMIC 2 Regular Interest LTA5, REMIC 2 Regular Interest LTM1, REMIC
2 Regular Interest LTM2, REMIC 2 Regular Interest LTM3, REMIC 2
Regular Interest LTM4, REMIC 2 Regular Interest LTM5, REMIC 2
Regular Interest LTM6, REMIC 2 Regular Interest LTM7, REMIC 2
Regular Interest LTM8, REMIC 2 Regular Interest LTM9, REMIC 2
Regular Interest LTB1, REMIC 2 Regular Interest LTB2 and REMIC 2
Regular Interest LTP, in each case as of such date of
determination.
“REMIC 2 Principal Loss
Allocation Amount”: With respect to any Distribution Date, an
amount equal to the product of (i) the aggregate Stated Principal
Balance of the Mortgage Loans and related REO Properties then
outstanding and the amounts on deposit in the Pre-Funding Account
and (ii) 1 minus a fraction, the numerator of which is the
aggregate Uncertificated Principal Balance of REMIC 2 Regular
Interest LTA1, REMIC 2 Regular Interest LTA2, REMIC 2 Regular
Interest LTA3, REMIC 2 Regular Interest LTA4, REMIC 2 Regular
Interest LTA5, REMIC 2 Regular Interest LTM1, REMIC 2 Regular
Interest LTM2, REMIC 2 Regular Interest LTM3, REMIC 2 Regular
Interest LTM4, REMIC 2 Regular Interest LTM5, REMIC 2 Regular
Interest LTM6, REMIC 2 Regular Interest LTM7, REMIC 2 Regular
Interest
LTM8, REMIC 2 Regular Interest LTM9,
REMIC 2 Regular Interest LTB1 and REMIC 2 Regular Interest LTB2 and
the denominator of which is the aggregate Uncertificated Principal
Balance of REMIC 2 Regular Interest LTA1, REMIC 2 Regular Interest
LTA2, REMIC 2 Regular Interest LTA3, REMIC 2 Regular Interest LTA4,
REMIC 2 Regular Interest LTA5, REMIC 2 Regular Interest LTM1, REMIC
2 Regular Interest LTM2, REMIC 2 Regular Interest LTM3, REMIC 2
Regular Interest LTM4, REMIC 2 Regular Interest LTM5, REMIC 2
Regular Interest LTM6, REMIC 2 Regular Interest LTM7, REMIC 2
Regular Interest LTM8, REMIC 2 Regular Interest LTM9, REMIC 2
Regular Interest LTB1, REMIC 2 Regular Interest LTB2 and REMIC 2
Regular Interest LTZZ.
“REMIC 2 Regular
Interest”: One of the separate non-certificated beneficial
ownership interests in REMIC 2 issued hereunder and designated as a
Regular Interest in REMIC 2. Each REMIC 2 Regular Interest shall
accrue interest at the related Uncertificated REMIC 2 Pass-Through
Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions
hereof, in an aggregate amount equal to its initial Uncertificated
Principal Balance as set forth in the Preliminary Statement hereto.
The following is a list of each of the REMIC 2 Regular Interests:
REMIC 2 Regular Interest LTAA, REMIC 2 Regular Interest LTA1, REMIC
2 Regular Interest LTA2, REMIC 2 Regular Interest LTA3, REMIC 2
Regular Interest LTA4, REMIC 2 Regular Interest LTA5, REMIC 2
Regular Interest LTM1, REMIC 2 Regular Interest LTM2, REMIC 2
Regular Interest LTM3, Regular Interest LTM4, REMIC 2 Regular
Interest LTM5, REMIC 2 Regular Interest LTM6, REMIC 2 Regular
Interest LTM7, REMIC 2 Regular Interest LTM8, REMIC 2 Regular
Interest LTM9, REMIC 2 Regular Interest LTB1, REMIC 2 Regular
Interest LTB2, REMIC 2 Regular Interest LTZZ and REMIC 2 Regular
Interest LTP.
“REMIC 3”: The
segregated pool of assets consisting of all of the REMIC 2 Regular
Interests conveyed in trust to the Trustee, for the benefit of the
Holders of the Regular Certificates and the Class R Certificates
(in respect of the Class R-3 Interest), pursuant to Article II
hereunder, and all amounts deposited therein, with respect to which
a separate REMIC election is to be made.
“REMIC 4”: The
segregated pool of assets consisting of all of the Class C Interest
conveyed in trust to the Trustee, for the benefit of the Holders of
the Regular Certificates and the Class R-X Certificate (in respect
of the Class R-4 Interest), pursuant to Article II hereunder, and
all amounts deposited therein, with respect to which a separate
REMIC election is to be made.
“REMIC 5”: The
segregated pool of assets consisting of all of the Class P Interest
conveyed in trust to the Trustee, for the benefit of the Holders of
the Regular Certificates and the Class R-X Certificate (in respect
of the Class R-5 Interest), pursuant to Article II hereunder, and
all amounts deposited therein, with respect to which a separate
REMIC election is to be made.
“REMIC Provisions”:
Provisions of the federal income tax law relating to real estate
mortgage investment conduits which appear at Section 860A through
860G of Subchapter M of Chapter 1 of the Code, and related
provisions, and regulations and rulings promulgated thereunder, as
the foregoing may be in effect from time to time.
“REMIC Regular
Interests”: The REMIC 1 Regular Interests, the REMIC 2
Regular Interests, the Class C Interest and the Class P
Interest.
“Remittance Report”: A
report prepared by the Servicer and delivered to the Trustee
pursuant to Section 4.04.
“Rents from Real
Property”: With respect to any REO Property, gross income of
the character described in Section 856(d) of the Code.
“REO Account”: The
account or accounts maintained by the Servicer in respect of an REO
Property pursuant to Section 3.23.
“REO Disposition”: The
sale or other disposition of an REO Property on behalf of the Trust
Fund.
“REO Imputed Interest”:
As to any REO Property, for any calendar month during which such
REO Property was at any time part of the Trust Fund, one
month’s interest at the applicable Net Mortgage Rate on the
Stated Principal Balance of such REO Property (or, in the case of
the first such calendar month, of the related Mortgage Loan if
appropriate) as of the Close of Business on the Distribution Date
in such calendar month.
“REO Principal
Amortization”: With respect to any REO Property, for any
calendar month, the excess, if any, of (a) the aggregate of all
amounts received in respect of such REO Property during such
calendar month, whether in the form of rental income, sale proceeds
(including, without limitation, that portion of the Termination
Price paid in connection with a purchase of all of the Mortgage
Loans and REO Properties pursuant to Section 10.01 that is
allocable to such REO Property) or otherwise, net of any portion of
such amounts (i) payable pursuant to Section 3.23 in respect of the
proper operation, management and maintenance of such REO Property
or (ii) payable or reimbursable to the Servicer pursuant to Section
3.23 for unpaid Servicing Fees in respect of the related Mortgage
Loan and unreimbursed Servicing Advances and Advances in respect of
such REO Property or the related Mortgage Loan, over (b) the REO
Imputed Interest in respect of such REO Property for such calendar
month.
“REO Property”: A
Mortgaged Property acquired by the Servicer on behalf of the Trust
Fund through foreclosure or deed-in-lieu of foreclosure, as
described in Section 3.23.
“Request for Release”: A
release signed by a Servicing Officer, in the form of Exhibit E
attached hereto.
“Reserve Interest Rate”:
With respect to any Interest Determination Date, the rate per annum
that the Trustee determines to be either (i) the arithmetic mean
(rounded upwards if necessary to the nearest whole multiple of 1/16
of 1%) of the one-month United States dollar lending rates which
banks in The City of New York selected by the Depositor are quoting
on the relevant Interest Determination Date to the principal London
offices of leading banks in the London interbank market or (ii) in
the event that the Trustee can determine no such arithmetic mean,
in the case of any Interest Determination Date after the initial
Interest Determination Date, the lowest one-month United States
dollar lending rate which such New York banks selected by the
Depositor are quoting on such Interest Determination Date to
leading European banks.
“Residential Dwelling”:
Any one of the following: (i) a detached one-family dwelling, (ii)
a detached two- to four-family dwelling, (iii) a one-family
dwelling unit in a Fannie Mae eligible condominium project, (iv) a
manufactured home, or (v) a detached one-family dwelling in a
planned unit development, none of which is a co-operative or mobile
home.
“Residual Certificate”:
Any Class R Certificates or Class R-X Certificates.
“Residual Interest”: The
sole class of “residual interests” in a REMIC within
the meaning of Section 860G(a)(2) of the Code.
“Responsible Officer”:
When used with respect to the Trustee, any director, any vice
president, any assistant vice president, the Secretary, any
assistant secretary, the Treasurer, any assistant treasurer or any
other officer of the Trustee customarily performing functions
similar to those performed by any of the above designated officers
and, with respect to a particular matter, to whom such matter is
referred because of such officer’s knowledge of and
familiarity with the particular subject.
“S&P”: Standard
& Poor’s Ratings Services, a division of The McGraw-Hill
Companies, Inc., or its successor in interest.
“Seller”: Greenwich
Capital Financial Products, Inc., a Delaware corporation, in its
capacity as Seller under the Mortgage Loan Purchase
Agreement.
“Senior Principal Distribution
Amount”: The excess of (x) the aggregate Certificate
Principal Balance of the Class A Certificates immediately prior to
such Distribution Date over (y) the lesser of (A) the product of
(i) 52.80% and (ii) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after
giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced, and
unscheduled collections of principal received during the related
Prepayment Period) and (B) the aggregate Stated Principal Balance
of the Mortgage Loans as of the last day of the related Due Period
(after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced, and
unscheduled collections of principal received during the related
Prepayment Period) minus the related Overcollateralization
Floor.
“Servicer”: Ocwen Loan
Servicing, LLC, a Delaware limited liability company, or any
successor servicer appointed as herein provided, in its capacity as
Servicer hereunder.
“Servicer
Certification”: As defined in Section 3.22(b)
hereof.
“Servicer Event of
Termination”: One or more of the events described in
Section 7.01.
“Servicer Prepayment Charge
Payment Amount”: The amounts payable by the Servicer in
respect of any waived Prepayment Charges pursuant to Section 2.05
or Section 3.01.
“Servicer Remittance
Date”: With respect to any Distribution Date, one Business
Day prior to such Distribution Date.
“Servicer Termination
Test”: The Servicer Termination Test will be failed with
respect to any Distribution Date if the aggregate amount of
Realized Losses incurred since the Cut-off Date through the last
day of the related Due Period (reduced by the aggregate amount of
Subsequent Recoveries received from the Cut-off Date through the
last day of the related Due Period) divided by aggregate Stated
Principal Balance of the Mortgage Loans as of the Cut-off Date and
the Original Pre-Funded Amounts exceeds the applicable percentages
set forth below with respect to such Payment Date:
Payment Date Occurring
In:
|
|
|
December 2005 through November
2010
|
10.00%
|
|
December 2010 and
thereafter
|
12.25%
|
“Servicing Advance
Reimbursement Amount”: As defined in Section 3.29.
“Servicing Advances”:
All customary, reasonable and necessary “out of pocket”
costs and expenses (including reasonable attorneys’ fees and
expenses) incurred by the Servicer in the performance of its
servicing obligations, including, but not limited to, the cost of
(i) the preservation, restoration, inspection and protection of the
Mortgaged Property, (ii) any enforcement or judicial proceedings,
including foreclosures, (iii) obtaining any legal documentation
required to be included in the Mortgage File and/or correcting any
outstanding title issues (i.e. any lien or encumbrance on the
Mortgaged Property that prevents the effective enforcement of the
intended lien position) reasonably necessary for the Servicer to
perform its obligations under this Agreement, (iv) the management
and liquidation of the REO Property and (v) compliance with the
obligations under Sections 3.01, 3.09, 3.14, 3.16, and 3.23.
Servicing Advances also include any reasonable
“out-of-pocket” costs and expenses (including legal
fees) incurred by the Servicer in connection with executing and
recording instruments of satisfaction, deeds of reconveyance or
Assignments of Mortgage in connection with any foreclosure in
respect of any Mortgage Loan to the extent not recovered from the
related Mortgagor or otherwise payable under this Agreement. The
Servicer shall not be required to make any Servicing Advance that
would be a Nonrecoverable Advance.
“Servicing Fee”: With
respect to each Mortgage Loan and for any calendar month, an amount
equal to the Servicing Fee Rate accrued for such month (or in the
event of any Principal Prepayment in full made by the Mortgagor
during such month, the Servicing Fee Rate accrued for the number of
days covered by the payment of interest accompanying the Principal
Prepayment in full), on the same principal amount on which interest
on such Mortgage Loan accrues for such month. A portion of such
Servicing Fee may be retained by any Sub-Servicer as its servicing
compensation.
“Servicing Fee Rate”:
0.50% per annum.
“Servicing Officer”: Any
officer of the Servicer involved in, or responsible for, the
administration and servicing of Mortgage Loans, whose name and
specimen signature appear on a list of servicing officers furnished
by the Servicer to the Trustee and the Depositor on the Closing
Date, as such list may from time to time be amended.
“Servicing Standard”:
Shall mean the standards set forth in Section 3.01.
“Servicing Transfer
Costs”: Shall mean all reasonable out-of-pocket costs and
expenses incurred by the Trustee in connection with the transfer of
servicing from a predecessor servicer, including, without
limitation, any reasonable out-of-pocket costs or expenses
associated with the complete transfer of all servicing data and the
completion, correction or manipulation of such servicing data as
may be required by the Trustee to correct any errors or
insufficiencies in the servicing data or otherwise to enable the
Trustee (or any successor servicer appointed pursuant to Section
7.02) to service the Mortgage Loans properly and
effectively.
“Startup Day”: As
defined in Section 9.01(b) hereof.
“Stated Principal
Balance”: With respect to any Mortgage Loan: (a) as of any
date of determination up to but not including the Distribution Date
on which the proceeds, if any, of a Liquidation Event with respect
to such Mortgage Loan would be distributed, the outstanding Stated
Principal Balance of such Mortgage Loan as of the Cut-off Date as
shown in the Mortgage Loan Schedule, minus the sum of (i) the
principal portion of each Monthly Payment due on a Due Date
subsequent to the Cut-off Date to the extent received from the
Mortgagor or advanced by the Servicer and distributed pursuant to
Section 4.01 on or before such date of determination, (ii) all
Principal Prepayments received after the Cut-off Date to the extent
distributed pursuant to Section 4.01 on or before such date of
determination, (iii) all Liquidation Proceeds and Insurance
Proceeds to the extent distributed pursuant to Section 4.01 on or
before such date of determination, and (iv) any Realized Loss
incurred with respect thereto as a result of a Deficient Valuation
made during or prior to the Due Period for the most recent
Distribution Date coinciding with or preceding such date of
determination; and (b) as of any date of determination coinciding
with or subsequent to the Distribution Date on which the proceeds,
if any, of a Liquidation Event with respect to such Mortgage Loan
would be distributed, zero. With respect to any REO Property: (a)
as of any date of determination up to but not including the
Distribution Date on which the proceeds, if any, of a Liquidation
Event with respect to such REO Property would be distributed, an
amount (not less than zero) equal to the Stated Principal Balance
of the related Mortgage Loan as of the date on which such REO
Property was acquired on behalf of the Trust Fund, minus the
aggregate amount of REO Principal Amortization in respect of such
REO Property for all previously ended calendar months, to the
extent distributed pursuant to Section 4.01 on or before such date
of determination; and (b) as of any date of determination
coinciding with or subsequent to the Distribution Date on which the
proceeds, if any, of a Liquidation Event with respect to such REO
Property would be distributed, zero.
“Stepdown Date”: The
earlier to occur of (i) the first Distribution Date on which the
aggregate Certificate Principal Balance of the Class A Certificates
has been reduced to zero and (ii) the later to occur of (x) the
Distribution Date occurring in December 2008 and (y) the first
Distribution Date on which the Credit Enhancement Percentage
(calculated for this purpose only after taking into account
payments of principal on the Mortgage Loans but prior to
distribution of the Principal Distribution Amount to the
Certificates then entitled to distributions of principal on such
Distribution Date) is equal to or greater than 47.20%.
“Sub-Servicer”: Any
Person with which the Servicer has entered into a Sub- Servicing
Agreement and which meets the qualifications of a Sub-Servicer
pursuant to Section 3.02.
“Sub-Servicing Account”:
An account established by a Sub-Servicer which meets the
requirements set forth in Section 3.08 and is otherwise acceptable
to the Servicer.
“Sub-Servicing
Agreement”: The written contract between the Servicer and a
Sub- Servicer relating to servicing and administration of certain
Mortgage Loans as provided in Section 3.02.
“Subsequent Cut-off
Date”: With respect to those Mortgage Loans sold to the Trust
Fund pursuant to a Subsequent Transfer Instrument, the earlier of
(i) the first day of the month following the month in which the
related Subsequent Transfer Date occurs (before application of
scheduled payments received with respect to the Subsequent Mortgage
Loans on such date) and (ii) the date specified in the related
Subsequent Transfer Instrument.
“Subsequent Mortgage
Loan”: A Mortgage Loan sold by the Depositor to the Trust
Fund pursuant to Section 2.08, such Mortgage Loan being identified
on the Mortgage Loan Schedule attached to a Subsequent Transfer
Instrument.
“Subsequent Mortgage Loan
Interest”: Any amount constituting a monthly payment of
interest received or advanced at the Net Mortgage Rate (less the
Trustee Fee Rate) with respect to a Subsequent Mortgage Loan during
the Due Period relating to the first three Distribution Dates in
excess of 0.00% per annum. The Subsequent Mortgage Loan Interest
shall be distributable to the Class C Certificates. The Subsequent
Mortgage Loan Interest shall not be an asset of any
REMIC.
“Subsequent Mortgage Loan
Purchase Agreement”: The agreement between the Depositor and
the Seller, regarding the transfer of the Subsequent Mortgage Loans
by the Seller to the Depositor.
“Subsequent Recoveries”:
As of any Distribution Date, unexpected amounts received by the
Servicer (net of any related expenses permitted to be reimbursed
pursuant to Section 3.11) specifically related to a Mortgage Loan
that was the subject of a liquidation or an REO Disposition prior
to the related Prepayment Period that resulted in a Realized
Loss.
“Subsequent Transfer
Date”: With respect to each Subsequent Transfer Instrument,
the date on which the related Subsequent Mortgage Loans are sold to
the Trust Fund.
“Subsequent Transfer
Instrument”: Each Subsequent Transfer Instrument, dated as of
a Subsequent Transfer Date, executed by the Trustee and the
Depositor substantially in the form attached hereto as Exhibit Q,
by which Subsequent Mortgage Loans are transferred to the Trust
Fund.
“Substitution
Adjustment”: As defined in Section 2.03(d) hereof.
“Tax Matters Person”:
The tax matters person appointed pursuant to Section 9.01(e)
hereof.
“Tax Returns”: The
federal income tax return on Internal Revenue Service Form 1066,
U.S. Real Estate Mortgage Investment Conduit Income Tax Return,
including Schedule Q thereto, Quarterly Notice to Residual Interest
Holders of the REMIC Taxable Income or Net Loss Allocation, or any
successor forms, to be filed by the Trustee on behalf of each
REMIC, together with any and all other information reports or
returns that may be required to be furnished to the
Certificateholders or filed with the Internal Revenue Service or
any other governmental taxing authority under any applicable
provisions of federal, state or local tax laws.
“Termination Price”: As
defined in Section 10.01(a) hereof.
“Terminator”: As defined
in Section 10.01(a) hereof.
“Trigger Event”: A
Trigger Event is in effect with respect to any Distribution Date on
or after the Stepdown Date if:
(a) the
Delinquency Percentage exceeds 33.00% of the Credit Enhancement
Percentage; or
(b) the
aggregate amount of Realized Losses incurred since the Cut-off Date
through the last day of the related Due Period (reduced by the
aggregate amount of Subsequent Recoveries received since the
Cut-off Date through the last day of the related Due Period)
divided by the aggregate Stated Principal Balance of the Mortgage
Loans as of the Cut-off Date and the Original Pre-Funded Amounts
exceeds the applicable percentages set forth below with respect to
such Distribution Date:
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Distribution Date Occurring
In
|
|
Percentage
|
|
December 2007 through November
2008
|
|
1.80% for the first month, plus an additional
1/12th of 2.20% for each month thereafter.
|
|
December 2008 through November
2009
|
|
4.00% for the first month, plus an additional
1/12th of 2.20% for each month thereafter.
|
|
December 2009 through November
2010
|
|
6.20% for the first month, plus an additional
1/12th of 1.75% for each month thereafter.
|
|
December 2010 through November
2011
|
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7.95% for the first month, plus an additional
1/12 th of 0.55% for each month thereafter
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December 2011 and
thereafter
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8.50%
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“Trust”: Meritage
Mortgage Loan Trust 2005-3, the trust created hereunder.
“Trust Fund”: All of the
assets of the Trust, which is the trust created hereunder
consisting of REMIC 1, REMIC 2, REMIC 3, REMIC 4, REMIC 5, the
Pre-Funding Account, the Interest Coverage Account, any Subsequent
Mortgage Loan Interest, the Cap Contract and the right to receive
any amounts from the Net WAC Rate Carryover Reserve Account and any
Servicer Prepayment Charge Payment Amounts.
“Trustee”: Deutsche Bank
National Trust Company, a national banking association, or any
successor trustee appointed as herein provided.
“Trustee Fee”:
Compensation consisting of the amount described in Section
3.11(b)(vi), which compensation shall be payable to the Trustee on
each Distribution Date pursuant to Section 8.05 as compensation for
all services rendered by it in the execution of the trust hereby
created and in the exercise and performance of any powers and
duties of the Trustee hereunder, which amount shall equal one
twelfth of the product of (i) the Trustee Fee Rate (without regard
to the words “per annum”), multiplied by (ii) the
aggregate Stated Principal Balance of the Mortgage Loans and any
REO Properties (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received
during the related Prepayment Period) and any amounts in the
Pre-Funding Accounts as of the first day of the calendar month
prior to the month of such Distribution Date (or, in the case of
the initial Distribution Date, as of the Cut-off Date).
“Trustee Fee Rate”:
0.0044% per annum.
“Uncertificated Accrued
Interest”: With respect to each REMIC Regular Interest on
each Distribution Date, an amount equal to one month’s
interest at the related Uncertificated REMIC 1 Pass-Through Rate or
Uncertificated REMIC 2 Pass-Through Rate on the Uncertificated
Principal Balance of such REMIC Regular Interest. In each case,
Uncertificated Accrued Interest will be reduced by any Net
Prepayment Interest Shortfalls and Relief Act Interest Shortfalls
(allocated to such REMIC Regular Interests based on their
respective entitlements to interest irrespective of any Net
Prepayment Interest Shortfalls and Relief Act Interest Shortfalls
for such Distribution Date).
“Uncertificated Principal
Balance”: With respect to each REMIC Regular Interest, the
amount of such REMIC Regular Interest outstanding as of any date of
determination. As of the Closing Date, the Uncertificated Principal
Balance of each REMIC Regular Interest shall equal the amount set
forth in the Preliminary Statement hereto as its initial
Uncertificated Principal Balance. On each Distribution Date, the
Uncertificated Principal Balance of each REMIC Regular Interest
shall be reduced by all distributions of principal made on such
REMIC Regular Interest on such Distribution Date pursuant to
Section 4.08 and, if and to the extent necessary and appropriate,
shall be further reduced on such Distribution Date by Realized
Losses as provided in Section 4.08, and the Uncertificated
Principal Balance of REMIC 2 Regular Interest LTZZ shall be
increased by interest deferrals as provided in Section 4.08. With
respect to the Class C Interest as of any date of determination, an
amount equal to the excess, if any, of (A) the then aggregate
Uncertificated Principal Balance of the REMIC 2 Regular Interests
over (B) the then aggregated Certificate Principal Balance of the
Class A Certificates, the Mezzanine Certificates, the Class B
Certificates and the Class P Certificates then outstanding. The
Uncertificated Principal Balance of each REMIC Regular Interest
that has an Uncertificated Principal Balance shall never be less
than zero.
“Uncertificated REMIC 1
Pass-Through Rate”: With respect to REMIC 1 Regular Interest
LT1 and REMIC 1 Regular Interest LTP, and (i) the first three
Distribution Dates, the weighted average of the Adjusted Net
Mortgage Rates of the Initial Mortgage Loans and (ii) thereafter,
the weighted average of the Adjusted Net Mortgage Rates of the
Mortgage Loans. With respect to REMIC 1 Regular Interest LT1PF and
(i) the first three Distribution Dates, 0.00% and (ii) thereafter,
the weighted average of the Adjusted Net Mortgage Rates of the
Mortgage Loans.
“Uncertificated REMIC 2
Pass-Through Rate”: For any Distribution Date and REMIC 2
Regular Interest LTAA, REMIC 2 Regular Interest LTA1, REMIC 2
Regular Interest LTA2, REMIC 2 Regular Interest LTA3, REMIC 2
Regular Interest LTA4, REMIC 2 Regular Interest LTA5, REMIC 2
Regular Interest LTM1, REMIC 2 Regular Interest LTM2, REMIC 2
Regular Interest LTM3, REMIC 2 Regular Interest LTM4, REMIC 2
Regular Interest LTM5, REMIC 2 Regular Interest LTM6, REMIC 2
Regular Interest LTM7, REMIC 2 Regular Interest LTM8, REMIC 2
Regular Interest LTM9, REMIC 2 Regular Interest LTB1, REMIC 2
Regular Interest LTB2, REMIC 2 Regular Interest LTP and REMIC 2
Regular Interest LTZZ, the weighted average of the Uncertificated
REMIC 1 Pass-Through Rates on the REMIC 1 Regular Interests,
weighted on the basis of the Uncertificated Principal Balance of
each such REMIC I Regular Interest.
“Uninsured Cause”: Any
cause of damage to a Mortgaged Property such that the complete
restoration of such property is not fully reimbursable by the
hazard insurance policies required to be maintained pursuant to
Section 3.14.
“United States Person”
or “U.S. Person”: A citizen or resident of the United
States, a corporation, 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, any state thereof, or the District of Columbia (except in
the case of a partnership, to the extent provided in Treasury
regulations) provided that, for purposes solely of the restrictions
on the transfer of Residual Certificates, no partnership or other
entity treated as a partnership for United States federal income
tax purposes shall be treated as a United States Person unless all
persons that own an interest in such partnership either directly or
through any entity that is not a corporation for United States
federal income tax purposes are required by the applicable
operative agreement to be United States Persons, or an estate the
income of which from sources without the United States is
includible in gross income for United States federal income tax
purposes regardless of its connection with the conduct of a trade
or business within the United States, or a trust if a court within
the United States is able to exercise primary supervision over the
administration of the trust and one or more United States persons
have authority to control all substantial decisions of the trust.
The term “United States” shall have the meaning set
forth in Section 7701 of the Code or successor
provisions.
“Unpaid Interest Shortfall
Amount”: With respect to the Class A Certificates, the
Mezzanine Certificates and the Class B Certificates and (i) the
first Distribution Date, zero, and (ii) any Distribution Date after
the first Distribution Date, the amount, if any, by which (a) the
sum of (1) the Monthly Interest Distributable Amount for such Class
for the immediately preceding Distribution Date and (2) the
outstanding Unpaid Interest Shortfall Amount, if any, for such
Class for such preceding Distribution Date exceeds (b) the
aggregate amount distributed on such Class in respect of interest
pursuant to clause (a) of this definition on such preceding
Distribution Date, plus interest on the amount of interest due but
not paid on the Certificates of such Class on such preceding
Distribution Date, to the extent permitted by law, at the
Pass-Through Rate for such Class for the related Accrual
Period.
“Value”: With respect to
any Mortgaged Property, the lesser of (i) the lesser of (a) the
value thereof as determined by an appraisal made for the originator
of the Mortgage Loan at the time of origination of the Mortgage
Loan by an appraiser who met the minimum
requirements of Fannie Mae and
Freddie Mac, and (b) the value thereof as determined by a review
appraisal conducted by the Originator in the event any such review
appraisal determines an appraised value ten percent or more lower
than the value thereof as determined by the appraisal referred to
in clause (i)(a) above and (ii) the purchase price paid for the
related Mortgaged Property by the Mortgagor with the proceeds of
the Mortgage Loan, provided, however, in the case of a Refinanced
Mortgage Loan, such value of the Mortgaged Property is based solely
upon the lesser of (1) the value determined by an appraisal made
for the Originator of such Refinanced Mortgage Loan at the time of
origination of such Refinanced Mortgage Loan by an appraiser who
met the minimum requirements of Fannie Mae and Freddie Mac and (2)
the value thereof as determined by a review appraisal conducted by
the Originator in the event any such review appraisal determines an
appraised value ten percent or more lower than the value thereof as
determined by the appraisal referred to in clause (ii)(1)
above.
“Voting Rights”: The
portion of the voting rights of all of the Certificates which is
allocated to any Certificate. At all times the Class A
Certificates, the Mezzanine Certificates, the Class B Certificates
and the Class C Certificates shall have 98% of the Voting Rights
(allocated among the Holders of the Class A Certificates, the
Mezzanine Certificates, the Class B Certificates and the Class C
Certificates in proportion to the then outstanding Certificate
Principal Balances of their respective Certificates), the Class P
Certificates shall have 1% of the Voting Rights and the Residual
Certificates shall have 1% of the Voting Rights. The Voting Rights
allocated to any Class of Certificates (other than the Class P
Certificates and the Residual Certificates) shall be allocated
among all Holders of each such Class in proportion to the
outstanding Certificate Principal Balance of such Certificates, and
the Voting Rights allocated to the Class P Certificates and the
Residual Certificates shall be allocated among all Holders of each
such Class in proportion to such Holders’ respective
Percentage Interest; provided, however that when none of the
Regular Certificates are outstanding, 100% of the Voting Rights
shall be allocated among Holders of the Residual Certificates in
accordance with such Holders’ respective Percentage Interests
in the Certificates of such Class.
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SECTION 1.02.
|
Accounting.
|
Unless otherwise specified herein,
for the purpose of any definition or calculation, whenever amounts
are required to be netted, subtracted or added or any distributions
are taken into account such definition or calculation and any
related definitions or calculations shall be determined without
duplication of such functions.
|
|
SECTION 1.03.
|
Allocation of Certain Interest
Shortfalls.
|
For purposes of calculating the
amount of the Monthly Interest Distributable Amount for the Class A
Certificates, Mezzanine Certificates, Class B Certificates and the
Class C Certificates for any Distribution Date, (1) the aggregate
amount of any Net Prepayment Interest Shortfalls and any Relief Act
Interest Shortfalls incurred in respect of the Mortgage Loans for
any Distribution Date shall be allocated first, to the Class C
Interest based on, and to the extent of, one month’s interest
based only on clause (i) of the then applicable Pass-Through Rate
on the Notional Amount of the Class C Interest and, thereafter,
among the Class A Certificates, the Mezzanine Certificates and the
Class B Certificates on a pro rata basis based on, and to the
extent of, one month’s interest at the then applicable
respective Pass-Through Rate on
the respective Certificate Principal
Balance of each such Certificate and (2) the aggregate amount of
any Realized Losses and Net WAC Rate Carryover Amounts incurred for
any Distribution Date shall be allocated to the Class C Interest
based on, and to the extent of, one month’s interest based
only on clause (i) of the then applicable Pass-Through Rate on the
Notional Amount of the Class C Interest.
For purposes of calculating the
amount of the Monthly Interest Distributable Amount for the Class C
Certificates for any Distribution Date, the aggregate amount of any
Net Prepayment Interest Shortfalls and any Relief Act Interest
Shortfalls allocated to the Class C Interest shall be allocated to
the Class C Certificates.
For purposes of calculating the
amount of Uncertificated Accrued Interest for the REMIC 1 Regular
Interests for any Distribution Date, the aggregate amount of any
Net Prepayment Interest Shortfalls and any Relief Act Interest
Shortfalls incurred in respect of the Mortgage Loans for any
Distribution Date shall be allocated with respect to the Mortgage
Loans, to REMIC 1 Regular Interest LT1 and REMIC 1 Regular Interest
LT1PF, in each case to the extent of one month’s interest at
the then applicable respective Uncertificated REMIC 1 Pass-Through
Rate on the respective Uncertificated Principal Balance of each
such Uncertificated REMIC 1 Interest; provided, however, with
respect to the first Distribution Date, such amounts relating to
the Initial Mortgage Loans shall be allocated to REMIC 1 Regular
Interest LT1 and such amounts relating to the Subsequent Mortgage
Loans shall be allocated to REMIC 1 Regular Interest
LT1PF.
For purposes of calculating the
amount of Uncertificated Accrued Interest for the REMIC 2 Regular
Interests for any Distribution Date, the aggregate amount of any
Net Prepayment Interest Shortfalls and any Relief Act Interest
Shortfalls incurred in respect of the Mortgage Loans for any
Distribution Date shall be allocated among REMIC 2 Regular Interest
LTAA, REMIC 2 Regular Interest LTA1, REMIC 2 Regular Interest LTA2,
REMIC 2 Regular Interest LTA3, REMIC 2 Regular Interest LTA4, REMIC
2 Regular Interest LTA5, REMIC 2 Regular Interest LTM1, REMIC 2
Regular Interest LTM2, REMIC 2 Regular Interest LTM3, REMIC 2
Regular Interest LTM4, REMIC 2 Regular Interest LTM5, REMIC 2
Regular Interest LTM6, REMIC 2 Regular Interest LTM7, REMIC 2
Regular Interest LTM8, REMIC 2 Regular Interest LTM9, REMIC 2
Regular Interest LTB1, REMIC 2 Regular Interest LTB2 and REMIC 2
Regular Interest LTZZ on a pro rata basis based on, and to
the extent of, one month’s interest at the then applicable
respective Uncertificated REMIC 2 Pass-Through Rate on the
respective Uncertificated Principal Balance of each such REMIC 2
Regular Interest.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF
CERTIFICATES
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SECTION 2.01.
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Conveyance of Mortgage
Loans.
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The Depositor, concurrently with the
execution and delivery hereof, does hereby transfer, assign, set
over and otherwise convey in trust to the Trustee without recourse
for the benefit of the Certificateholders all the right, title and
interest of the Depositor, including any security interest therein
for the benefit of the Depositor, in and to (i) each Mortgage Loan
identified on the Mortgage Loan Schedule, including the related
Cut-off Date Principal Balance, all interest accruing thereon on
and after the Cut-off Date and all collections in respect of
interest and principal due after the Cut-off Date; (ii) property
which secured each such Mortgage Loan and which has been acquired
by foreclosure or deed in lieu of foreclosure; (iii) its interest
in any insurance policies in respect of the Mortgage Loans; (iv)
the rights of the Depositor under the Mortgage Loan Purchase
Agreement, (v) the right to receive any amounts payable under the
Cap Contract (vi) all other assets included or to be included in
the Trust Fund and (vii) all proceeds of any of the foregoing. Such
assignment includes all interest and principal due and collected by
the Depositor or the Servicer after the Cut-off Date with respect
to the Mortgage Loans.
The Depositor hereby directs the
Trustee to execute, deliver and perform its obligations under the
Cap Contract on the Closing Date and thereafter on behalf of the
Holders of the Floating Rate Certificates. The Seller, the
Depositor, the Servicer and the Holders of the Floating Rate
Certificates by their acceptance of such Certificates acknowledge
and agree that the Trustee shall execute, deliver and perform its
obligations under the Cap Contract and shall do so solely in its
capacity as Trustee of the Trust Fund and not in its individual
capacity.
In connection with such transfer and
assignment, the Depositor, does hereby deliver to, and deposit with
the Trustee, or its designated agent (the “Custodian”),
the following documents or instruments with respect to each Initial
Mortgage Loan so transferred and assigned and shall, in accordance
with Section 2.08, deliver or caused to be delivered to the Trustee
with respect to each Subsequent Mortgage Loan, the following
documents or instruments (with respect to each Mortgage Loan, a
“Mortgage File”):
(i) the
original Mortgage Note, endorsed either (A) in blank, in which case
the Trustee shall cause the endorsement to be completed or (B) in
the following form: “Pay to the order of Deutsche Bank
National Trust Company, as Trustee, without recourse” or with
respect to any lost Mortgage Note, an original Lost Note Affidavit
stating that the original mortgage note was lost, misplaced or
destroyed, together with a copy of the related mortgage note;
provided, however, that such substitutions of Lost Note Affidavits
for original Mortgage Notes may occur only with respect to Mortgage
Loans, the aggregate Cut-off Date Principal Balance of which is
less than or equal to 1.00% of the Pool Balance as of the Cut-off
Date;
(ii) the
original Mortgage, noting the presence of the MIN of the Mortgage
Loan and language indicating that the Mortgage Loan is a MOM Loan
if the Mortgage Loan is a MOM Loan, with evidence of recording
thereon, and the original recorded power of attorney, if the
Mortgage was executed pursuant to a power of attorney, with
evidence of recording thereon or, if such Mortgage or power of
attorney has been submitted for recording but has not been returned
from the applicable public recording office, has been lost or is
not otherwise available, a copy of such Mortgage or power of
attorney, as the case may be, certified to be a true and complete
copy of the original submitted for recording;
(iii) unless
the Mortgage Loan is registered on the MERS® System, an
original Assignment, in form and substance acceptable for
recording. The Mortgage shall be assigned either (A) in blank or
(B) to “Deutsche Bank National Trust Company, as Trustee,
without recourse”
(iv) an
original copy of any intervening assignment of Mortgage showing a
complete chain of assignments (or to MERS, if the Mortgage Loan is
registered on the MERS® System and noting the presence of the
MIN);
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(v)
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the original or a certified copy of
lender’s title insurance policy; and
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(vi) the
original or copies of each assumption, modification, written
assurance or substitution agreement, if any.
The Depositor herewith also delivers
to the Trustee an executed copy of the Mortgage Loan Purchase
Agreement.
If any of the documents referred to
in Section 2.01(ii), (iii) or (iv) above has as of the Closing Date
(or Subsequent Transfer Date, with respect to Subsequent Mortgage
Loans) been submitted for recording but either (x) has not been
returned from the applicable public recording office or (y) has
been lost or such public recording office has retained the original
of such document, the obligations of the Depositor to deliver such
documents shall be deemed to be satisfied upon (1) delivery to the
Trustee or the Custodian no later than the Closing Date (or
Subsequent Transfer Date, with respect to Subsequent Mortgage
Loans), of a copy of each such document certified by the Originator
in the case of (x) above or the applicable public recording office
in the case of (y) above to be a true and complete copy of the
original that was submitted for recording and (2) if such copy is
certified by the Originator, delivery to the Trustee or the
Custodian, promptly upon receipt thereof of either the original or
a copy of such document certified by the applicable public
recording office to be a true and complete copy of the original. If
the original lender’s title insurance policy, or a certified
copy thereof, was not delivered pursuant to Section 2.01(v) above,
the Depositor shall deliver or cause to be delivered to the Trustee
or the Custodian, the original or a copy of a written commitment or
interim binder or preliminary report of title issued by the title
insurance or escrow company, with the original or a certified copy
thereof to be delivered to the Trustee or the Custodian, promptly
upon receipt thereof. The Servicer or the Depositor shall deliver
or cause to be delivered to the Trustee or the Custodian promptly
upon receipt thereof any other documents constituting a part of a
Mortgage
File received with respect to any
Mortgage Loan, including, but not limited to, any original
documents evidencing an assumption or modification of any Mortgage
Loan.
Upon discovery or receipt of notice
of any materially defective document in, or that a document is
missing from, a Mortgage File, the Trustee shall notify the
Servicer and shall enforce the obligations of the Seller or the
Originator, as applicable, under the Mortgage Loan Purchase
Agreement to cure such defect or deliver such missing document to
the Trustee or the Custodian within 90 days. If the Seller or the
Originator, as applicable, does not cure such defect or deliver
such missing document within such time period, the Trustee shall
enforce the obligations of the Seller or the Originator, as
applicable, to either repurchase or substitute for such Mortgage
Loan in accordance with Section 2.03. If the Seller or the
Originator, as applicable, fails to either repurchase or substitute
for such Mortgage Loan in accordance with its respective
obligations under the Mortgage Loan Purchase Agreement, the Trustee
and the Depositor shall consult on further actions to be taken
against the Originator or the Seller, as applicable. In connection
with the foregoing, it is understood that the Trustee shall have no
duty to discover any such defects except in the course of
performing its review of the Mortgage Files to the extent set forth
herein.
Except with respect to any Mortgage
Loan for which MERS is identified on the Mortgage or on a properly
recorded assignment of the Mortgage as the mortgagee of record, the
Trustee shall enforce the obligations of the Originator under the
Mortgage Loan Purchase Agreement to cause the Assignments which
were delivered in blank to be completed and to record all
Assignme
