EXHIBIT 99.1
------------
6
<PAGE>
EXECUTION COPY
====================
CWALT, INC.,
Depositor
COUNTRYWIDE HOME LOANS, INC.,
Seller
PARK GRANADA LLC,
Seller
PARK MONACO INC.,
Seller
PARK SIENNA LLC,
Seller
COUNTRYWIDE HOME LOANS
SERVICING LP,
Master Servicer
and
THE BANK OF NEW YORK,
Trustee
-----------------------------------
POOLING AND SERVICING AGREEMENT
Dated as of September 1, 2005
-----------------------------------
ALTERNATIVE LOAN TRUST 2005-53T2
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2005-53T2
====================
<PAGE>
<TABLE>
<CAPTION>
Table of Contents
Page
ARTICLE I
DEFINITIONS
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES
<S>
<C>
SECTION 2.01. Conveyance of Mortgage
Loans...............................................................47
SECTION 2.02. Acceptance by Trustee of the
Mortgage
Loans................................................51
SECTION 2.03. Representations, Warranties
and Covenants of the Sellers and the Master
Servicer...........53
SECTION 2.04. Representations and
Warranties of the Depositor as to the Mortgage
Loans...................55
SECTION 2.05. Delivery of Opinion of
Counsel in Connection with
Substitutions............................56
SECTION 2.06. Execution and Delivery of
Certificates.....................................................56
SECTION 2.07. REMIC
Matters..............................................................................57
SECTION 2.08. Covenants of the Master
Servicer...........................................................57
ARTICLE III
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
SECTION 3.01. Master Servicer to Service
Mortgage
Loans..................................................58
SECTION 3.02. Subservicing; Enforcement of
the Obligations of
Subservicers...............................59
SECTION 3.03. Rights of the Depositor and
the Trustee in Respect of the Master
Servicer..................59
SECTION 3.04. Trustee to Act as Master
Servicer..........................................................60
SECTION 3.05. Collection of Mortgage Loan
Payments; Certificate Account; Distribution Account;
Corridor Contract Reserve Fund; Class C Distribution
Account...............................60
SECTION 3.06. Collection of Taxes,
Assessments and Similar Items; Escrow
Accounts........................64
SECTION 3.07. Access to Certain
Documentation and Information Regarding the Mortgage
Loans...............65
SECTION 3.08. Permitted Withdrawals from
the Certificate Account, the Distribution Account and
the Corridor Contract Reserve
Fund.........................................................65
SECTION 3.09. Maintenance of Hazard
Insurance; Maintenance of Primary Insurance
Policies.................67
SECTION 3.10. Enforcement of Due-on-Sale
Clauses; Assumption
Agreements..................................69
SECTION 3.11. Realization Upon Defaulted
Mortgage Loans; Repurchase of Certain Mortgage
Loans............70
SECTION 3.12. Trustee to Cooperate;
Release of Mortgage
Files............................................73
SECTION 3.13. Documents, Records and Funds
in Possession of Master Servicer to be Held for the
Trustee....................................................................................74
ii
<PAGE>
SECTION 3.14. Servicing
Compensation.....................................................................75
SECTION 3.15. Access to Certain
Documentation............................................................75
SECTION 3.16. Annual Statement as to
Compliance..........................................................75
SECTION 3.17. Annual Independent Public
Accountants' Servicing Statement; Financial
Statements...........76
SECTION 3.18. Errors and Omissions
Insurance; Fidelity
Bonds.............................................76
SECTION 3.19. The Corridor
Contract......................................................................77
ARTICLE IV
DISTRIBUTIONS AND ADVANCES BY THE MASTER SERVICER
SECTION 4.01.
Advances...................................................................................78
SECTION 4.02. Priorities of
Distribution.................................................................79
SECTION 4.03.
[Reserved].................................................................................84
SECTION 4.04. Allocation of Realized
Losses..............................................................84
SECTION 4.05.
[Reserved].................................................................................85
SECTION 4.06. Monthly Statements to
Certificateholders...................................................85
SECTION 4.07. Determination of
Pass-Through Rates for COFI
Certificates..................................87
SECTION 4.08. Determination of
Pass-Through Rates for LIBOR
Certificates.................................88
SECTION 4.09. Distributions for the
Corridor Contract Reserve
Fund.......................................90
ARTICLE V
THE CERTIFICATES
SECTION 5.01. The
Certificates...........................................................................91
SECTION 5.02. Certificate Register;
Registration of Transfer and Exchange of
Certificates................91
SECTION 5.03. Mutilated, Destroyed, Lost
or Stolen
Certificates..........................................96
SECTION 5.04. Persons Deemed
Owners......................................................................96
SECTION 5.05. Access to List of
Certificateholders' Names and
Addresses..................................96
SECTION 5.06. Maintenance of Office or
Agency............................................................97
ARTICLE VI
THE DEPOSITOR AND THE MASTER SERVICER
SECTION 6.01. Respective Liabilities of
the Depositor and the Master
Servicer............................98
SECTION 6.02. Merger or Consolidation of
the Depositor or the Master
Servicer............................98
SECTION 6.03. Limitation on Liability of
the Depositor, the Sellers, the Master Servicer and
Others.....................................................................................98
SECTION 6.04. Limitation on Resignation of
Master
Servicer...............................................99
ARTICLE VII
DEFAULT
SECTION 7.01. Events of
Default.........................................................................100
SECTION 7.02. Trustee to Act; Appointment
of
Successor..................................................101
SECTION 7.03. Notification to
Certificateholders........................................................103
iii
<PAGE>
ARTICLE VIII
CONCERNING THE TRUSTEE
SECTION 8.01. Duties of
Trustee.........................................................................104
SECTION 8.02. Certain Matters Affecting
the
Trustee.....................................................105
SECTION 8.03. Trustee Not Liable for
Certificates or Mortgage
Loans.....................................106
SECTION 8.04. Trustee May Own
Certificates..............................................................106
SECTION 8.05. Trustee's Fees and
Expenses...............................................................106
SECTION 8.06. Eligibility Requirements for
Trustee......................................................107
SECTION 8.07. Resignation and Removal of
Trustee........................................................107
SECTION 8.08. Successor
Trustee.........................................................................108
SECTION 8.09. Merger or Consolidation of
Trustee........................................................108
SECTION 8.10. Appointment of Co-Trustee or
Separate
Trustee.............................................109
SECTION 8.11. Tax
Matters...............................................................................110
ARTICLE IX
TERMINATION
SECTION 9.01. Termination upon Liquidation
or Purchase of all Mortgage
Loans............................113
SECTION 9.02. Final Distribution on the
Certificates....................................................113
SECTION 9.03. Additional Termination
Requirements.......................................................115
SECTION 9.04. Auction of the Mortgage
Loans and REO
Properties..........................................116
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.01.
Amendment.................................................................................118
SECTION 10.02. Recordation of Agreement;
Counterparts....................................................119
SECTION 10.03. Governing
Law.............................................................................120
SECTION 10.04. Intention of
Parties......................................................................120
SECTION 10.05.
Notices...................................................................................120
SECTION 10.06. Severability of
Provisions................................................................122
SECTION 10.07.
Assignment................................................................................122
SECTION 10.08. Limitation on Rights of
Certificateholders................................................122
SECTION 10.09. Inspection and Audit
Rights...............................................................123
SECTION 10.10. Certificates Nonassessable and
Fully Paid.................................................123
SECTION 10.11.
[Reserved]................................................................................123
SECTION 10.12. Protection of
Assets......................................................................123
iv
<PAGE>
SCHEDULES
Schedule I: Mortgage Loan
Schedule..................................................................S-I-1
Schedule II-A: Representations and Warranties of
Countrywide........................................S-II-A-1
Schedule II-B: Representations and Warranties of
Park Granada.......................................S-II-B-1
Schedule II-C: Representations and Warranties of
Park Monaco Inc....................................S-II-C-1
Schedule II-D: Representations and Warranties of
Park Sienna LLC....................................S-II-D-1
Schedule III-A: Representations and
Warranties of Countrywide as to the
Mortgage
Loans......................................................................S-III-A-1
Schedule III-B: Representations and
Warranties of Countrywide as to the
Countrywide Mortgage
Loans..........................................................S-III-B-1
Schedule III-C: Representations and
Warranties of Park Granada as to the Park
Granada Mortgage
Loans..............................................................S-III-C-1
Schedule III-D: Representations and
Warranties of Park Monaco Inc.
as to the Park Monaco Inc. Mortgage
Loans...........................................S-III-D-1
Schedule III-E: Representations and
Warranties of Park Sienna LLC
as to the Park Sienna LLC Mortgage
Loans............................................S-III-E-1
Schedule IV: Representations and
Warranties of the Master
Servicer..................................S-IV-1
Schedule V: Principal
Balance Schedules (if
applicable).............................................S-V-1
Schedule VI: Form of Monthly Master
Servicer
Report.................................................S-VI-I
EXHIBITS
Exhibit A: Form of
Senior Certificate (excluding Notional Amount
Certificates).......................A-1
Exhibit B: Form of
Subordinated
Certificate..........................................................B-1
Exhibit C-1: Form of Class A-R
Certificate...........................................................C-1-1
Exhibit C-2:
[Reserved]..............................................................................C-2-1
Exhibit D: Form of
Notional Amount
Certificate.......................................................D-1
Exhibit E: Form of
Reverse of
Certificates...........................................................E-1
Exhibit F-1: Form of Initial
Certification of
Trustee................................................F-1-1
Exhibit F-2:
[Reserved]..............................................................................F-2-1
Exhibit G-1: Form of Delay Delivery
Certification of
Trustee.........................................G-1-1
Exhibit G-2:
[Reserved]..............................................................................G-2-1
Exhibit H-1: Form of Final
Certification of
Trustee..................................................H-1-1
Exhibit H-2:
[Reserved]..............................................................................H-2-1
Exhibit I: Form of
Transfer
Affidavit................................................................I-1
Exhibit J-1: Form of Transferor
Certificate
(Residual)...............................................J-1-1
Exhibit J-2: Form of Transferor
Certificate
(Private)................................................J-2-1
Exhibit K: Form of
Investment Letter [Non-Rule
144A].................................................K-1
Exhibit L: Form of
Rule 144A
Letter..................................................................L-1
Exhibit M: Form of
Request for Release (for
Trustee).................................................M-1
Exhibit N: Form of
Request for Release of Documents (Mortgage Loan - Paid
in Full, Repurchased and
Replaced)........................................................N-1
Exhibit O:
[Reserved]................................................................................O-1
Exhibit P:
[Reserved]................................................................................P-1
Exhibit Q: Standard
& Poor's LEVELS(R) Version 5.6c Glossary Revised,
Appendix
E................................................................................Q-1
v
<PAGE>
Exhibit R: Form of
Corridor
Contract.................................................................R-1
Exhibit S: Form of
Assignment
Agreement..............................................................S-1
</TABLE>
vi
<PAGE>
THIS POOLING AND
SERVICING AGREEMENT, dated as of September 1, 2005,
among CWALT, INC., a Delaware corporation,
as depositor (the "Depositor"),
COUNTRYWIDE HOME LOANS, INC.
("Countrywide"), a New York corporation, as a
seller (a "Seller"), PARK GRANADA LLC
("Park Granada"), a Delaware limited
liability company, as a seller (a
"Seller"), PARK MONACO INC. ("Park Monaco"),
a Delaware corporation, as a seller (a
"Seller"), PARK SIENNA LLC ("Park
Sienna"), a Delaware limited liability
company, as a seller (a "Seller")
COUNTRYWIDE HOME LOANS SERVICING LP, a
Texas limited partnership, as master
servicer (the "Master Servicer"), and THE
BANK OF NEW YORK, a banking
corporation organized under the laws of the
State of New York, as trustee (the
"Trustee").
WITNESSETH THAT
In consideration
of the mutual agreements herein contained, the parties
hereto agree as follows:
PRELIMINARY STATEMENT
The Depositor is
the owner of the Trust Fund that is hereby conveyed to
the Trustee in return for the Certificates.
For federal income tax purposes,
the Trust Fund (other than the Corridor
Contract and the Corridor Contract
Reserve Fund) will consist of five real
estate mortgage investment conduits
(each a "REMIC" or, in the alternative,
"REMIC 1," "REMIC 2," the "REMIC 3",
the "REMIC 4" and the "Master REMIC,"
respectively). Each Certificate, other
than the Class A-R Certificate, will
represent ownership of one or more
regular interests in the Master REMIC for
purposes of the REMIC Provisions.
The Class A-R Certificate will represent
ownership of the sole class of
residual interest in each REMIC created
hereunder. The Master REMIC will hold
as assets the several classes of
uncertificated REMIC 4 Interests (other than
the Class R-4 Interest). The REMIC 4 will
hold as assets the several classes
of uncertificated REMIC 3 Interests (other
than the Class R-3 Interest). The
REMIC 3 will hold as assets the several
classes of uncertificated REMIC 2
Interests (other than the Class R-2
Interest). The REMIC 2 will hold as assets
the several classes of uncertificated REMIC
1 Interests (other than the Class
R-1 Interest). REMIC 1 will hold as assets
all property of the Trust Fund
(other than the Corridor Contract and the
Corridor Contract Reserve Fund).
Each REMIC 4 Interest (other than the Class
R-4 Interest) is hereby designated
as a regular interest in the Master REMIC.
Each REMIC 3 Interest (other than
the Class R-3 Interest) is hereby
designated as a regular interest in REMIC 4.
Each REMIC 2 Interest (other than the Class
R-2 Interest) is hereby designated
as a regular interest in REMIC 2 and each
REMIC 1 Interest (other than the
Class R-1 Interest) is hereby designated as
a regular interest in REMIC 1. The
latest possible maturity date of all REMIC
regular interests created herein
shall be the Latest Possible Maturity
Date.
1
<PAGE>
The following
table sets forth characteristics of the Master REMIC
Certificates, together with the minimum
denominations and integral multiples
in excess thereof in which such Classes
shall be issuable (except that one
Certificate of each Class of Certificates
may be issued in a different amount
and, in addition, one Residual Certificate
representing the Tax Matters Person
Certificate may be issued in a different
amount):
<TABLE>
<CAPTION>
=================================================================================================
Integral
Pass-Through
Multiples in
Class
Initial Class
Rate
Minimum
Excess of
Designation
Certificate Balance (per
annum) Denomination
Minimum
-------------------------------------------------------------------------------------------------
<S>
<C>
<C>
<C>
<C>
Class 1-A-1
$19,914,960.00
5.00%
$25,000.00
$1,000.00
-------------------------------------------------------------------------------------------------
Class 2-A-1
$160,500,000.00
(1)
$25,000.00
$1,000.00
-------------------------------------------------------------------------------------------------
Class 2-A-2
$13,525,251.00
5.50%
$25,000.00
$1,000.00
-------------------------------------------------------------------------------------------------
Class 2-A-3
$3,000,000.00
5.50%
$1,000.00
$1,000.00
-------------------------------------------------------------------------------------------------
Class 2-A-4
$1,699,000.00
5.50%
$1,000.00
$1,000.00
-------------------------------------------------------------------------------------------------
Class 2-A-5
$751,000.00
5.50%
$1,000.00
$1,000.00
-------------------------------------------------------------------------------------------------
Class 2-A-6
$113,698,000.00
(2)
$25,000.00
$1,000.00
-------------------------------------------------------------------------------------------------
Class 2-A-7
(3)
(4)
$25,000.00(5)
$1,000.00
-------------------------------------------------------------------------------------------------
Class 2-A-8
(6)
0.50%
$25,000.00(5)
$1,000.00
-------------------------------------------------------------------------------------------------
Class X
(7)
(8)
$25,000.00(5)
$1,000.00
-------------------------------------------------------------------------------------------------
Class PO
$16,000.00
(9)
$25,000.00
$1,000.00
-------------------------------------------------------------------------------------------------
Class A-R(10)
$100.00
5.00%
$100.00(11)
$100.00(11)
-------------------------------------------------------------------------------------------------
Class M
$13,759,139.00
(12)
$25,000.00
$1,000.00
-------------------------------------------------------------------------------------------------
Class B-1
$3,020,298.00
(12)
$25,000.00
$1,000.00
-------------------------------------------------------------------------------------------------
Class B-2
$2,013,532.00
(12)
$25,000.00
$1,000.00
-------------------------------------------------------------------------------------------------
Class B-3
$1,677,943.00
(12)
$100,000.00
$1,000.00
-------------------------------------------------------------------------------------------------
Class B-4
$1,174,560.00
(12)
$100,000.00
$1,000.00
-------------------------------------------------------------------------------------------------
Class B-5
$838,971.00
(12)
$100,000.00
$1,000.00
-------------------------------------------------------------------------------------------------
Class C
$100.00
(13)
$100.00
N/A
=================================================================================================
</TABLE>
---------------------------------
(1) The Class 2-A-1 Certificates will
bear interest during each Interest
Accrual Period
for each Distribution Date at a per annum rate equal to
the lesser of
(i) 6.00% and (ii) the product of (x) 6.00% minus the
Available Funds
Rate and (y) a fraction, the numerator of which is the
principal
balance of Collateral Allocation Group 2 and the denominator of
which is the
Class Certificate Balance of the Class 2-A-1 Certificates
immediately
prior to such Distribution Date.
(2) The Class 2-A-6 Certificates will
bear interest during each Interest
Accrual Period
at a per annum rate of LIBOR plus 0.50%, subject to a
maximum and
minimum Pass-Through Rate of 6.00% and 0.50% per annum,
respectively.
The Pass-Through Rate for the Class 2-A-6 Certificates
during the
initial Interest Accrual Period is 4.22% per annum.
(3) The Class 2-A-7 Certificates will
bear interest during each Interest
Accrual Period
at a per annum rate of 5.50% minus LIBOR, subject to a
maximum and
minimum Pass-
2
<PAGE>
Through Rate of
5.50% and 0.00% per annum, respectively. The Pass-Through
Rate for the
Class 2-A-7 Certificates during the initial Interest Accrual
Period is 1.78%
per annum.
(4) The Class 2-A-7 Certificates will
be Notional Amount Certificates, will
have no Class
Certificate Balance and will bear interest on its Notional
Amount
(initially, $113,698,000).
(5) Minimum denomination is based on
the Notional Amount of such Class.
(6) The Class 2-A-8 Certificates will
be Notional Amount Certificates, will
have no Class
Certificate Balance and will bear interest on its Notional
Amount
(initially, $18,975,251).
(7) The Class X Certificates will be
Notional Amount Certificates, will have
no Class
Certificate Balance and will bear interest on its Notional
Amount
(initially, $249,570,674).
(8) The Pass-Through Rate for the
Class X Certificates for the Interest
Accrual Period
for any Distribution Date will be equal to (i) the excess
of (a) the
weighted average of the Adjusted Net Mortgage Rates of the
Mortgage Loans
with an Adjusted Net Mortgage Rate greater than or equal
to 6.00%,
weighted on the basis of the Stated Principal Balance thereof
as of the Due
Date in the month preceding the month of that Distribution
Date (after
giving effect to Principal Prepayments received in the
Prepayment
Period related to that Due Date) over (b) 6.00%, minus (ii)
the product of
1% and a fraction, the numerator of which is equal to the
Aggregate Net
Cross Payment and the denominator of which is equal to the
Notional Amount
of the Class X Certificates immediately prior to such
Distribution
Date. The Pass-Through Rate for the Class X Certificates
during the
initial Interest Accrual Period is 0.4256% per annum.
(9) This Class of Certificates will be
Principal Only Certificates and will
not receive any
distributions of interest.
(10) The Class A-R Certificates represent
the sole Class of residual interest
in each REMIC.
(11) The Class A-R Certificates shall be
issued as two separate certificates,
one with an
initial Certificate Balance of $99.99 and the Tax Matters
Person
Certificate with an initial Certificate Balance of $0.01.
(12) The Pass-Through Rate for each Class
of Subordinated Certificates for the
Interest Accrual
Period related to any Distribution Date will be a per
annum rate equal
to (a) the sum of the following for each Collateral
Allocation
Group: the related Required Coupon multiplied by the greater
of (y) zero and
(z) the excess of (i) the Collateral Allocation Group
Principal
Balance of that Collateral Allocation Group as of the Due Date
in the month
preceding the month of that Distribution Date (after giving
effect to
Principal Prepayments received in the Prepayment Period related
to that prior
Due Date) over (ii) the aggregate Class Certificate Balance
of the related
Senior Certificate Group (other than the Class PO
Certificates)
immediately prior to that Distribution Date, plus with
respect to Loan
Group 1 and minus with respect to Loan Group 2 the
Aggregate Net
Cross Payment, if any, divided by (b) the aggregate of the
Class
Certificate Balances of the Subordinated Certificates
immediately
prior to that
Distribution Date. The Pass-Through Rate for each Class of
Subordinated
Certificates for the Interest Accrual Period related to the
first
Distribution Date will be 5.9364% per annum.
3
<PAGE>
(13) The Class C Certificates will not be
entitled to payments of interest but
will be entitled
to receive any Auction Excess Proceeds in connection
with any
Successful Auction conducted pursuant to the terms hereof. The
Class C
Certificates will be issued as a single certificate with an
initial
Certificate Balance of $100.00.
4
<PAGE>
The following table specifies the class
designation, interest rate, and
principal amount for each class of REMIC 4
Interests:
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------
REMIC 4 Interest
Initial Principal Interest Rate
Corresponding Master
Balance
REMIC Certificate
------------------------------------------------------------------------------------------------
<S>
<C>
<C>
<C>
4-1-A-1
$19,914,960.00
5.00%
Class 1-A-1
------------------------------------------------------------------------------------------------
4-2-A-1
$160,500,000.00
(1)
Class 2-A-1
------------------------------------------------------------------------------------------------
4-2-A-2
$13,525,251.00
5.50%
Class 2-A-2, Class 2-A-8(2)
------------------------------------------------------------------------------------------------
4-2-A-3
$3,000,000.00
5.50%
Class 2-A-3, Class 2-A-8(2)
------------------------------------------------------------------------------------------------
4-2-A-4
$1,699,000.00
5.50%
Class 2-A-4, Class 2-A-8(2)
------------------------------------------------------------------------------------------------
4-2-A-5
$751,000.00
5.50%
Class 2-A-5, Class 2-A-8(2)
------------------------------------------------------------------------------------------------
4-2-A-6
$113,698,000.00
6.00%
Class 2-A-6, Class 2-A-7(3)
------------------------------------------------------------------------------------------------
4-1-$100
$100.00
5.00%
Class A-R
------------------------------------------------------------------------------------------------
4-X
(4)
(5)
Class X
------------------------------------------------------------------------------------------------
4-PO
$16,000.00
(6)
Class PO
------------------------------------------------------------------------------------------------
4-M
$13,759,139.00
(7)
Class M
------------------------------------------------------------------------------------------------
4-B-1
$3,020,298.00
(7)
Class B-1
------------------------------------------------------------------------------------------------
4-B-2
$2,013,532.00
(7)
Class B-2
------------------------------------------------------------------------------------------------
4-B-3
$1,677,943.00
(7)
Class B-3
------------------------------------------------------------------------------------------------
4-B-4
$1,174,560.00
(7)
Class B-4
------------------------------------------------------------------------------------------------
4-B-5
$838,971.00
(7)
Class B-5
------------------------------------------------------------------------------------------------
R-4
(8)
(8)
N/A
------------------------------------------------------------------------------------------------
</TABLE>
-----------------------
(1) The excess of 6% over the product
of two and the weighted average of the
Pass-Through
Rates of the Accretion Directed Classes and the Class
3-2-A-1 Interest
(i) subjecting each Accretion Directed Class to a cap
and a floor
equal to 6% and the Class 3-2-A-1 Interest to a cap equal to
zero.
(2) For each Distribution Date, the
Class 2-A-8 Certificates are entitled to
a portion of the
interest payable on the Class 4-2-A-2, Class 4-2-A-3,
Class 4-2-A-4
and Class 4-2-A-5 Interests. Specifically, for each such
Distribution Date, the
Class 2-A-7 Certificates are entitled to the
interest payable
on the Class 4-2-A-2, Class 4-2-A-3, Class 4-2-A-4 and
Class 4-2-A-5
Interests at a per annum rate equal to 0.50%.
(3) For each Distribution Date, the
Class 2-A-7 Certificates are entitled to
a portion of the
interest payable on the Class 4-2-A-6 Interest.
Specifically,
for each such Distribution Date, the Class 2-A-7
Certificates are
entitled to the interest payable on the Class 4-2-A-6
Interest at a
per annum rate equal to 5.50% minus LIBOR, but not less
than 0.00%.
(4) The Class 4-X Interest makes no
principal payments.
(5) For each Distribution Date, the
Class X Certificates are entitled to 100%
of the cash flow
in respect of the Class 3-X Interest.
(6) The Class 4-PO Interest makes no
interest payments. For each Distribution
Date it is
entitled to the principal distributions made with respect to
the Class 3-PO
Interest.
(7) The Calculation Rate.
5
<PAGE>
(8) The R-4 is the sole class of
residual interest in REMIC 4. It pays no
interest or
principal.
6
<PAGE>
REMIC 3
The following table specifies the class
designation, interest rate, and
principal amount for each class of REMIC 3
Interests:
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------
IO REMIC Interest
Initial Principal Interest Rate Corresponding
Master
Balance
REMIC Certificate
---------------------------------------------------------------------------------------
<S>
<C>
<C>
<C>
3-1-A-1
(1)
5.00%
Class 1-A-1
---------------------------------------------------------------------------------------
3-2-A-1
(2)
6.00%
N/A
---------------------------------------------------------------------------------------
3-2-A-2
(1)
6.00%
Class 2-A-2
---------------------------------------------------------------------------------------
3-2-A-3
(1)
6.00%
Class 2-A-3
---------------------------------------------------------------------------------------
3-2-A-4
(1)
6.00%
Class 2-A-4
---------------------------------------------------------------------------------------
3-2-A-5
(1)
6.00%
Class 2-A-5
---------------------------------------------------------------------------------------
3-2-A-6
(1)
6.00%
Class 2-A-6
---------------------------------------------------------------------------------------
3-X
(3)
(3)
Class X
---------------------------------------------------------------------------------------
3-PO
(4)
(4)
Class PO
---------------------------------------------------------------------------------------
3-M
(5)
(5)
Class M
---------------------------------------------------------------------------------------
3-B-1
(5)
(5)
Class B-1
---------------------------------------------------------------------------------------
3-B-2
(5)
(5)
Class B-2
---------------------------------------------------------------------------------------
3-B-3
(5)
(5)
Class B-3
---------------------------------------------------------------------------------------
3-B-4
(5)
(5)
Class B-4
---------------------------------------------------------------------------------------
3-B-5
(5)
(5)
Class B-5
---------------------------------------------------------------------------------------
R-3
(6)
(6)
N/A
---------------------------------------------------------------------------------------
</TABLE>
-----------------------
(1) For each Distribution Date, following
the allocation of scheduled
principal, prepayments and Realized Losses,
the principal balance will equal
50% of the principal balance for such
Distribution Date of the Corresponding
Master REMIC Certificate Class. These
Interests are referred to as the
"Accretion Directed Classes".
(2) For each Distribution Date, following
the allocation of scheduled
principal, prepayments and Realized Losses,
the principal balance will equal
the excess of the Principal Balance of the
Class 1-A-1, Class 2-A-1, Class
2-A-2, Class 2-A-3, Class 2-A-4, Class
2-A-5 and Class 2-A-6 Certificates over
the principal balance of the Accretion
Directed Classes.
(3) The Class 3-X Interest is entitled to
all cash flow in respect of the
Class X-2 Interests.
(4) The Class 3-PO Interest is entitled to
all cash flow in respect of the
Class PO-1 Interests.
(5) For each Distribution Date, following
the allocation of scheduled
principal, prepayments and Realized Losses,
the principal balance will equal
100% of the principal balance for such
Distribution Date of the Corresponding
Master REMIC Certificate Class. Their pass
through rate will be the
Calculation Rate.
(6) The R-3 is the sole class of residual
interest in the IO REMIC. It pays no
interest or principal.
7
<PAGE>
REMIC 2
The REMIC 2
Regular Interests will have the initial principal balance,
Pass-Through Rates and corresponding Loan
Groups as set forth in the following
table:
Collateral
Initial Principal Pass-Through Allocation
REMIC 2 Interests
Balance
Rate
Group
-----------------
-------
----
-----
A-1 (0.9% of AB Loan Group 1)
(1)
5.00%
1
B-1 (0.1% of AB Loan Group 1)
(1)
5.00%
1
C-1 (Excess of Loan Group 1)
(1)
5.00%
1
PO-1
(1)
0.00%
1
A-2 (0.9% of AB Loan Group 2)
(1)
6.00%
2
B-2 (0.1% of AB Loan Group 2)
(1)
6.00%
2
C-2 (Excess of Loan Group 2)
(1)
6.00%
2
X-2
(1)
(1)
2
R-2
(2)
(2)
N/A
---------------
(1) Each Class A Interest will have a
principal balance initially equal to
0.9% of the Assumed Balance ("AB") of its
corresponding Loan Group. Each Class
B Interest will have a principal balance
initially equal to 0.1% of the AB of
its corresponding Loan Group. The initial
principal balance of each Class C
Interest will equal the excess of the
Non-PO Percentage of the initial
aggregate principal balance of its
corresponding Collateral Allocation Group
over the initial aggregate principal
balances of the Class A and Class B
Interests corresponding to such Collateral
Allocation Group. On each
Distribution Date following the allocation
of scheduled principal, prepayments
and Realized Losses, the Class X-2
Interests will have the notional balance
and pass through rate of the Class X
Certificates and the Class PO-1 Interests
will have the principal balances of the
Class PO Certificates.
(2) The Class R-2 Interest is the sole
class of residual interest in REMIC 2.
It has no principal balance and pays no
principal or interest.
On each
Distribution Date, interest and the Non-PO Percentage of
principal collections shall be distributed
with respect to the REMIC 2
Interests in the following manner:
(1) Interest is to be distributed with
respect to each REMIC 2 Interest
according to the formulas described
above;
(2) If a Cross-Over Situation does not
exist with respect to any Class of
Interests, then Principal Amounts and
Realized Losses arising with respect to
each Collateral Allocation Group will be
allocated: first to cause the
Collateral Allocation Group's corresponding
Class A and Class B to equal,
respectively, 0.9% of the AB and 0.1% of
the AB; and second to the Collateral
Allocation Group's corresponding Class C
Interest;
(3) If a Cross-Over Situation exists with
respect to the Class A and B
Interests then:
8
<PAGE>
(a) if the
Calculation Rate in respect of such Class A and Class B
Interests is
less than the Pass Through Rate in respect of the
Subordinate
Certificates, Principal Relocation Payments will be made
proportionately
to the outstanding Class A Interests prior to any other
distributions of
principal from each such Collateral Allocation Group;
and
(b) if the
Calculation Rate in respect of such outstanding Class A and
Class B
Interests is greater than the Pass Through Rate in respect of
the
Subordinate
Certificates, Principal Relocation Payments will be made
proportionately
to the outstanding Class B Interests prior to any other
distributions of
principal from each such Collateral Allocation Group.
In case of either (a) or (b), Principal
Relocation Payments will be made so as
to cause the Calculation Rate in respect of
the outstanding Class A and B
Interests to equal the Pass Through Rate in
respect of the Subordinate
Certificates. With respect to each
Collateral Allocation Group, if (and to the
extent that) the sum of (a) the principal
payments comprising the Principal
Amount received during the Due Period and
(b) the Realized Losses on the
Mortgage Loans in that Collateral
Allocation Group, are insufficient to make
the necessary reductions of principal on
the Class A and B Interests, then
interest will be added to the Collateral
Allocation Group's other REMIC 1
Interests that are not receiving Principal
Relocation Payments, in proportion
to their principal balances.
(c) The
outstanding aggregate Class A and B Interests will not be
reduced
below 1% of the
excess of (i) the aggregate Stated Principal Balance of
the Mortgage
Loans as of the end of any Due Period over (ii) the
Certificate
Balance of the Senior Certificates (excluding the Class A-R
Certificates) as
of the related Distribution Date (after taking into
account
distributions of principal on such Distribution Date).
If (and to the
extent that) the limitation in paragraph (c) prevents the
distribution of
principal to the Class A and Class B Interests of a
Collateral
Allocation Group, and if the Collateral Allocation Group's
Class C Interest
has already been reduced to zero, then the excess
principal from
that Collateral Allocation Group will be paid to the Class
C Interests of
the other Collateral Allocation Group, the aggregate Class
A and Class B
Interests of which are less than 1% of the AB. If the
Mortgage Loans
in the Collateral Allocation Group of the Class C Interest
that receives
such payment has a Weighted Average Adjusted Net Mortgage
Rate below the
Weighted Average Adjusted Net Mortgage Rate of the
Mortgage Loans
in the Collateral Allocation Group making the payment,
then the payment
will be treated by the REMIC 2 as a Realized Loss.
Conversely, if
the Mortgage Loans in the Loan Group of the Class C
Interest that
receives such payment have a Weighted Average Adjusted Net
Mortgage Rate
above the Weighted Average Adjusted Net Mortgage Rate of
the Mortgage
Loans in the Collateral Allocation Group making the payment,
then the payment
will be treated by the REMIC 2 as a reimbursement for
prior Realized
Losses.
9
<PAGE>
REMIC 1 will
issue a single regular interest corresponding to each
Mortgage Loan having a Net Mortgage Rate
less than or equal to 5.00% and two
regular interests (referred to collectively
herein as the "Class 1-A
Interests" and the "Class 1-B Interests")
for each Mortgage Loan having a Net
Mortgage Rate greater than 5.00% and less
than 6.00%.
Each REMIC 1
Regular Interest corresponding to a Mortgage Loan having a
Net Mortgage Rate less than or equal to
5.00% will have a Pass Through Rate of
5.00% and a principal balance, following
the allocation of scheduled
principal, prepayments of principal and
Realized Losses, equal to the product
of: (i) the Non-PO Percentage of the
related Mortgage Loan and (ii) the
related Mortgage Loan's principal balance.
For purposes of the calculating the
Calculation Rate, each of the foregoing
REMIC 1 Regular Interest will be
treated as part of Collateral Allocation
Group 1.
Each of the
Class 1-A Interests will have a Pass Through Rate of 5.00%
and a principal balance, following the
allocation of scheduled principal,
prepayments of principal and Realized
Losses, equal to the product of: (i)
6.00% minus the Net Mortgage Rate in
respect of the related Mortgage Loan,
divided by 1.00%, and (ii) the related
Mortgage Loan's principal balance. For
purposes of the calculating the Calculation
Rate, each Class 1-A Interest will
be treated as part of Collateral Allocation
Group 1.
Each of the
Class 1-B Interests will have a Pass Through Rate of 6.00%
and a principal balance, following the
allocation of scheduled principal,
prepayments of principal and Realized
Losses, equal to the product of: (i) the
Net Mortgage Rate in respect of the related
Mortgage Loan minus 5.00%, divided
by 1.00%, and (ii) the related Mortgage
Loan's principal balance. For purposes
of the calculating the Calculation Rate,
each Class 1-B Interest will be
treated as part of Collateral Allocation
Group 2.
REMIC 1 also
will issue the Class 1-PO Interest and the Class R-1
Interest. The Class 1-PO Interest will have
a principal balance, following the
allocation of scheduled principal,
prepayments of principal and Realized
Losses, equal to the principal balance in
respect of the Class PO Certificates
and will not be entitled to receive
distributions of interest. The Class R-1
Interest is the residual interest and will
not be entitled to any
distributions of interest or principal.
The following table specifies the class
designation, interest rate, and
principal amount for each class of IO REMIC
Interests:
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------
IO REMIC
Interest Initial
Principal
Interest Rate
Corresponding Master
Balance
REMIC Certificate
-----------------------------------------------------------------------------------------------
<S>
<C>
<C>
<C>
IO-1-A-1
$19,914,960.00
5.00% Class
1-A-1
-----------------------------------------------------------------------------------------------
IO-2-A-1
$160,500,000.00
6.00% Class
2-A-1
-----------------------------------------------------------------------------------------------
IO-2-A-2
$13,525,251.00
5.50% Class
2-A-2, Class 2-A-8(1)
-----------------------------------------------------------------------------------------------
IO-2-A-3
$3,000,000.00
5.50% Class
2-A-3, Class 2-A-8(1)
-----------------------------------------------------------------------------------------------
IO-2-A-4
$1,699,000.00
5.50% Class
2-A-4, Class 2-A-8(1)
-----------------------------------------------------------------------------------------------
IO-2-A-5
$751,000.00
5.50% Class
2-A-5, Class 2-A-8(1)
-----------------------------------------------------------------------------------------------
10
<PAGE>
-----------------------------------------------------------------------------------------------
IO-2-A-6
$113,698,000.00
6.00% Class
2-A-6, Class 2-A-7(2)
-----------------------------------------------------------------------------------------------
IO-1-$100
$100.00
5.00% Class
A-R
-----------------------------------------------------------------------------------------------
IO-X
(3)
(4) Class X
-----------------------------------------------------------------------------------------------
IO-PO
$16,000.00
(5)
Class PO
-----------------------------------------------------------------------------------------------
IO-M
$13,759,139.00
(6)
Class M
-----------------------------------------------------------------------------------------------
IO-B-1
$3,020,298.00
(6)
Class B-1
-----------------------------------------------------------------------------------------------
IO-B-2
$2,013,532.00
(6)
Class B-2
-----------------------------------------------------------------------------------------------
IO-B-3
$1,677,943.00
(6)
Class B-3
-----------------------------------------------------------------------------------------------
IO-B-4
$1,174,560.00
(6)
Class B-4
-----------------------------------------------------------------------------------------------
IO-B-5
$838,971.00
(6)
Class B-5
-----------------------------------------------------------------------------------------------
IO-A-R
(7)
(7)
N/A
-----------------------------------------------------------------------------------------------
</TABLE>
-----------------------
(1) For each Distribution Date, the
Class 2-A-8 Certificates are entitled to
a portion of the
interest payable on the Class IO-2-A-2, Class IO-2-A-3,
Class IO-2-A-4
and Class IO-2-A-5 Interests. Specifically, for each such
Distribution
Date, the Class 2-A-7 Certificates are entitled to the
interest payable
on the Class IO-2-A-2, Class IO-2-A-3, Class IO-2-A-4
and Class
IO-2-A-5 Interests at a per annum rate equal to 0.50%.
(2) For each Distribution Date, the
Class 2-A-7 Certificates are entitled to
a portion of the
interest payable on the Class IO-2-A-6 Interest.
Specifically,
for each such Distribution Date, the Class 2-A-7
Certificates are
entitled to the interest payable on the Class IO-2-A-8
Interest at a
per annum rate equal to 5.50% minus LIBOR, but not less
than 0.00%.
(3) The Class IO-X Interest makes no
principal payments.
(4) For each Distribution Date, the
Class X Certificates are entitled to a
portion of the
interest payable on the Mortgage Loans in Collateral
Allocation Group
2. Specifically, for each related Distribution Date, the
Class X
Certificates is entitled to interest accruals on the Mortgage
Loans in
Collateral Allocation Group 2 equal to the excess of (a) the
Available Funds
Rate, over (b) the weighted average of the Pass-Through
Rates in respect
of the Group 2 Senior Certificates and the Subordinated
Certificates,
multiplying each of the Class Certificate Balances of the
Subordinated
Certificates by a fraction, the numerator of which is the
Collateral
Allocation Group 2 Portion, and the denominator of which is
the aggregate
Class Certificate Balance of the Subordinated Certificates.
(5) The Class IO-PO Interest makes no
interest payments. For each
Distribution
Date it is entitled to the principal distributions made with
respect to the
Class SW-PO Subordinate WAC REMIC Interest.
(6) The Subordinate Pass-Through
Rate.
(7) The IO-A-R is the sole class of
residual interest in the IO REMIC. It
pays no interest
or principal.
On each
Distribution Date, interest shall be payable on the IO REMIC
Interests according the formulas described
above, and principal, Realized
Losses and Subsequent Recoveries shall be
allocated among the IO REMIC
Interests in the same manner that such
items are allocated among their
corresponding Certificate Classes.
11
<PAGE>
Set forth below
are designations of Classes or Components of Certificates
and other defined terms to the categories
used herein:
<TABLE>
<CAPTION>
<S>
<C>
Accretion Directed
Certificates.............None.
Accretion Directed
Components...............None.
Accrual
Certificates........................None.
Accrual
Components..........................None.
Book-Entry
Certificates.....................All Classes of Certificates other
than the Physical Certificates.
COFI
Certificates...........................None.
Component
Certificates......................None.
Components..................................For purposes of
calculating distributions of principal and/or
interest, the Component Certificates, if any, will be comprised
of
multiple payment components having the designations, Initial
Component Balances or Notional Amounts, as applicable, and
Pass-Through Rates set forth below:
Initial
Designation
Component Balance Pass-Through Rate
-----------
----------------- -----------------
N/A
N/A
N/A
Delay
Certificates..........................All interest-bearing Classes
of Certificates other than the
Non-Delay Certificates, if any.
ERISA-Restricted
Certificates...............The Residual Certificates and Private
Certificates; and any
Certificate of a Class that ceases to satisfy the applicable
rating requirement under an Underwriter's Exemption.
Floating Rate
Certificates..................Class 2-A-6 Certificates.
Group 1
Certificates........................Group 1 Senior Certificates and
the portions of the Subordinated
Certificates related to Collateral Allocation Group 1.
Group 1 Senior
Certificates.................Class 1-A-1, Class A-R and Class PO
Certificates.
Group 2
Certificates........................Group 2 Senior Certificates and
the portions of the Subordinated
Certificates related to Collateral Allocation Group 2.
12
<PAGE>
Group 2 Senior
Certificates.................Class 2-A-1, Class 2-A-2, Class 2-A-3,
Class 2-A-4, Class 2-A-5,
Class 2-A-6, Class 2-A-7, Class 2-A-8 and Class X Certificates.
Inverse Floating Rate
Certificates..........Class 2-A-7 Certificates.
LIBOR
Certificates..........................Floating Rate Certificates
and Inverse Floating Rate Certificates.
Non-Delay
Certificates......................LIBOR Certificates.
Notional Amount
Certificates................Class 2-A-6, Class 2-A-7 and Class X
Certificates.
Notional Amount
Components..................None.
Offered
Certificates........................All Classes of Certificates
other than the Private Certificates.
Physical
Certificates.......................Private Certificates and the
Residual Certificates.
Planned Principal
Classes...................None.
Principal Only
Certificates.................Class PO Certificates.
Private
Certificates........................Class C, Class B-3, Class B-4
and Class B-5 Certificates.
Rating
Agencies.............................S&P and Moody's.
Regular
Certificates........................All Classes of Certificates,
other than the Residual Certificates.
Residual
Certificates.......................Class A-R Certificates.
Senior Certificate
Group....................The Group 1 Senior Certificates or the
Group 2 Senior Certificates,
as applicable.
Senior
Certificates.........................Class 1-A-1, Class 2-A-1,
Class 2-A-2, Class 2-A-3, Class 2-A-4,
Class 2-A-5, Class 2-A-6, Class 2-A-7, Class 2-A-8, Class X,
Class
PO and Class A-R Certificates.
Subordinated
Certificates...................Class M, Class B-1, Class B-2, Class
B-3, Class B-4 and Class B-5
Certificates.
Targeted Principal Classes
.................Class 2-A-1, Class 2-A-2, Class 2-A-3, Class
2-A-4, Class 2-A-5 and
Class 2 A-8 Certificates.
Underwriter
................................Bear, Stearns & Co. Inc.
</TABLE>
13
<PAGE>
With respect to
any of the foregoing designations as to which the
corresponding reference is "None," all
defined terms and provisions herein
relating solely to such designations shall
be of no force or effect, and any
calculations herein incorporating
references to such designations shall be
interpreted without reference to such
designations and amounts. Defined terms
and provisions herein relating to
statistical rating agencies not designated
above as Rating Agencies shall be of no
force or effect.
14
<PAGE>
ARTICLE I
DEFINITIONS
Whenever used in
this Agreement, the following words and phrases, unless
the context otherwise requires, shall have
the following meanings:
Accretion
Directed Certificates: As specified in the Preliminary
Statement.
Accretion
Direction Rule: Not applicable.
Accrual Amount:
With respect to any Class of Accrual Certificates or any
Accrual Component and any Distribution Date
prior to the related Accrual
Termination Date, the amount allocable to
interest on such Class of Accrual
Certificates or Accrual Component with
respect to such Distribution Date
pursuant to Section 4.02(a).
Accrual
Certificates: As specified in the Preliminary Statement.
Accrual
Components: As specified in the Preliminary Statement.
Accrual
Termination Date: Not applicable.
Adjusted
Mortgage Rate: As to each Mortgage Loan, and at any time, the
per annum rate equal to the Mortgage Rate
less the Master Servicing Fee Rate.
Adjusted Net
Mortgage Rate: As to each Mortgage Loan, and at any time,
the per annum rate equal to the Mortgage
Rate less the Master Servicing Fee
Rate. For purposes of determining whether
any Substitute Mortgage Loan is a
Discount Mortgage Loan or a Non-Discount
Mortgage Loan and for purposes of
calculating the applicable PO Percentage,
the applicable Non-PO Percentage and
the Applicable Fraction with respect to
each Mortgage Loan, each Substitute
Mortgage Loan shall be deemed to have an
Adjusted Net Mortgage Rate equal to
the Adjusted Net Mortgage Rate of the
Deleted Mortgage Loan for which it is
substituted.
Advance: The
payment required to be made by the Master Servicer with
respect to any Distribution Date pursuant
to Section 4.01, the amount of any
such payment being equal to the aggregate
of payments of principal and
interest (net of the Master Servicing Fee)
on the Mortgage Loans that were due
on the related Due Date and not received by
the Master Servicer as of the
close of business on the related
Determination Date, together with an amount
equivalent to interest on each Mortgage
Loan as to which the related Mortgaged
Property is an REO Property net of any net
income from such REO Property, less
the aggregate amount of any such delinquent
payments that the Master Servicer
has determined would constitute a
Nonrecoverable Advance, if advanced.
Aggregate Net
Cross Payment: For any Distribution Date, an amount equal
to the excess, if any, of (x) the total
amount of principal distributed to the
Class 1-A-1 Certificates on all prior
Distribution Dates from payments
received in respect of Collateral
Allocation Group 2, over (y) the total
amount of principal distributed to the
Group 2 Senior Certificates on all
prior Distribution Dates from payments
received in respect of Collateral
Allocation Group 1.
15
<PAGE>
Aggregate
Planned Balance: With respect to any group of Planned Principal
Classes or Components and any Distribution
Date, the amount set forth for such
group for such Distribution Date in
Schedule V hereto.
Aggregate
Targeted Balance: With respect to any group of Targeted
Principal Classes or Components and any
Distribution Date, the amount set
forth for such group for such Distribution
Date in Schedule V hereto.
Agreement: This
Pooling and Servicing Agreement and all amendments or
supplements hereto.
Allocable Share:
As to any Distribution Date and any Mortgage Loan (i)
with respect to the Class PO Certificates,
zero, (ii) with respect to the
Class X Certificates, (a) the excess of (x)
the Available Funds Rate, over (y)
the weighted average of the Pass-Through
Rates in respect of the Group 2
Senior Certificates and the Subordinated
Certificates, multiplying each of the
Class Certificate Balances of the
Subordinated Certificates by a fraction, the
numerator of which is the Collateral
Allocation Group 2 Portion, and the
denominator of which is the aggregate Class
Certificate Balance of the
Subordinated Certificates or (b) if the
Available Funds Rate does not exceed
the rate calculated pursuant to clause (y),
zero, and (iii) with respect to
each other Class of Certificates, the
product of (a) the lesser of (I) the
ratio that the related Required Coupon
bears to the Adjusted Net Mortgage Rate
of such Mortgage Loan and (II) one,
multiplied by (b) the ratio that the
amount calculated with respect to such
Distribution Date for such Class
pursuant to clause (i) of the definition of
Class Optimal Interest
Distribution Amount (without giving effect
to any reduction of such amount
pursuant to Section 4.02(e)) bears to the
amount calculated with respect to
such Distribution Date for each Class of
Certificates pursuant to clause (i)
of the definition of Class Optimal Interest
Distribution Amount (without
giving effect to any reduction of such
amount pursuant to Section 4.02(e)).
Amount Available
for Senior Principal: As to any Distribution Date and
any Collateral Allocation Group, Available
Funds for such Distribution Date
and Collateral Allocation Group, reduced by
the aggregate amount distributable
(or allocable to a related Accrual Amount,
if applicable) on such Distribution
Date in respect of interest on the related
Senior Certificates pursuant to
Section 4.02(a).
Amount Held for
Future Distribution: As to any Distribution Date and the
Mortgage Loans, the aggregate amount held
in the Certificate Account at the
close of business on the related
Determination Date on account of (i)
Principal Prepayments received after the
related Prepayment Period and
Liquidation Proceeds and Subsequent
Recoveries received in the month of such
Distribution Date and (ii) all Scheduled
Payments due after the related Due
Date.
Applicable
Credit Support Percentage: As defined in Section 4.02(f).
Applicable
Fraction: With respect to any Mortgage Loan and a Collateral
Allocation Group, the percentage for such
Mortgage Loan and Collateral
Allocation Group set forth on the Mortgage
Loan Schedule and calculated as
follows:
16
<PAGE>
<TABLE>
<CAPTION>
Net Mortgage Rate of the
Collateral
Collateral Allocation
Mortgage Loan
Allocation Group 1
Group 2
--------------------------------------
--------------------
-------------------------
<S>
<C>
<C>
less than or equal to 5.00%............
100.00%
0.00%
6.00% - Net
6.00% -
Net
Mortgage Rate 100.00% -
Mortgage Rate
greater than 5.00% and less
---------------
-----------------------
than 6.00%.............................
1.00%
1.00%
greater than or equal to 6.00%.........
0.00%
100.00%
</TABLE>
Appraised Value:
With respect to any Mortgage Loan, the Appraised Value
of the related Mortgaged Property shall be:
(i) with respect to a Mortgage
Loan other than a Refinancing Mortgage
Loan, the lesser of (a) the value of
the Mortgaged Property based upon the
appraisal made at the time of the
origination of such Mortgage Loan and (b)
the sale price of the Mortgaged
Property at the time of the origination of
such Mortgage Loan; (ii) with
respect to a Refinancing Mortgage Loan
other than a Streamlined Documentation
Mortgage Loan, the value of the Mortgaged
Property based upon the appraisal
made-at the time of the origination of such
Refinancing Mortgage Loan; and
(iii) with respect to a Streamlined
Documentation Mortgage Loan, (a) if the
loan-to-value ratio with respect to the
Original Mortgage Loan at the time of
the origination thereof was 80% or less and
the loan amount of the new
mortgage loan is $650,000 or less, the
value of the Mortgaged Property based
upon the appraisal made at the time of the
origination of the Original
Mortgage Loan and (b) if the loan-to-value
ratio with respect to the Original
Mortgage Loan at the time of the
origination thereof was greater than 80% or
the loan amount of the new loan being
originated is greater than $650,000, the
value of the Mortgaged Property based upon
the appraisal (which may be a
drive-by appraisal) made at the time of the
origination of such Streamlined
Documentation Mortgage Loan.
Assignment
Agreement: With respect to the Class 2-A-6 Certificates and
the Corridor Contract, the agreement, dated
as of the Closing Date, among
Countrywide Home Loans, Inc., the Trustee
and the Corridor Contract
Counterparty, a form of which is attached
hereto as Exhibit S.
Assumed Balance:
With respect to any Distribution Date, Class of
Subordinated Certificates and Collateral
Allocation Group, each such Class'
pro rata interest (based on their
respective Class Certificate Balances) in
such Collateral Allocation Group equal to
the product of the Subordinated
Percentage for such Collateral Allocation
Group as of such Distribution Date
and the aggregate of the applicable Non-PO
Percentage of the Applicable
Fraction of the Stated Principal Balance of
each Mortgage Loan related to that
Collateral Allocation Group as of the Due
Date occurring in the month
preceding the month of such Distribution
Date (after giving effect to
Principal Prepayments received in the
Prepayment Period related to that Due
Date).
Assumed Interest
Amount: With respect to any Distribution Date and Class
of Subordinated Certificates, one month's
interest accrued during the related
Interest Accrual
17
<PAGE>
Period at the Pass-Through Rate for such
Class on the applicable Assumed
Balance immediately prior to that
Distribution Date.
Auction Excess
Proceeds: With respect to a Successful Auction, the excess
of the purchase price paid by the Winning
Bidder over the Minimum Bid Price.
Available Funds:
As to any Distribution Date and the Mortgage Loans
related to a Collateral Allocation Group,
the sum of the related Applicable
Fractions of each of the following amounts:
(a) the aggregate amount held in
the Certificate Account at the close of
business on the related Determination
Date, including any Subsequent Recoveries,
in respect of such Mortgage Loans,
net of the related Amount Held for Future
Distribution and net of amounts
permitted to be withdrawn from the
Certificate Account pursuant to clauses (i)
- (viii), inclusive, of Section 3.08(a) in
respect of such Mortgage Loans and
amounts permitted to be withdrawn from the
Distribution Account pursuant to
clauses (i) - (v), inclusive, of Section
3.08(b) in respect of such Mortgage
Loans, (b) the amount of the related
Advance, (c) in connection with Defective
Mortgage Loans, the aggregate of the
Purchase Prices and Substitution
Adjustment Amounts deposited on the related
Distribution Account Deposit Date,
(d) with respect to Collateral Allocation
Group 2, plus any Transfer Payment
received for such Collateral Allocation
Group, and (e) with respect to
Collateral Allocation Group 1, minus any
Transfer Payment made from such
Collateral Allocation Group.
Available Funds
Rate: For the Interest Accrual Period for each
Distribution Date, the weighted average of
the Adjusted Net Mortgage Rates of:
(i) Collateral Allocation Group 2 and (ii)
a portion of Collateral Allocation
Group 1 equal to the excess of the amount
of principal distributed to the
Class 1-A-1 Certificates from principal
payments received in respect of
Collateral Allocation Group 2 on all prior
Distribution Dates over the amount
of principal distributed to the Group 2
Senior Certificates from principal
payments received in respect of Collateral
Allocation Group 1, assuming for
its purpose of this clause (ii) that the
Mortgage Loans have Adjusted Net
Mortgage Rates equal to 5.00%.
Bankruptcy Code:
The United States Bankruptcy Reform Act of 1978, as
amended.
Basis Risk
Shortfall Amounts: With respect to the Class 2-A-1
Certificates, any excess of the Class
Optimal Interest Distribution Amount
over the interest accrued on the Class
4-2-A-1 Interest for such Distribution
Date.
Bid Date: As
specified in Section 9.04(b).
Blanket
Mortgage: The mortgage or mortgages encumbering the Cooperative
Property.
Book-Entry
Certificates: As specified in the Preliminary Statement.
Business Day:
Any day other than (i) a Saturday or a Sunday, or (ii) a
day on which banking institutions in the
City of New York, New York, or the
State of California or the city in which
the Corporate Trust Office of the
Trustee is located are authorized or
obligated by law or executive order to be
closed.
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<PAGE>
Calculation
Rate: For each Distribution Date, the product of (i) 10 and
(ii) the weighted average rate of the
outstanding Class A and Class B
Interests, treating each Class A Interest
as capped at zero or reduced by a
fixed percentage of 100% of the interest
accruing on such Class A Interest.
Certificate: Any
one of the Certificates executed by the Trustee in
substantially the forms attached hereto as
exhibits.
Certificate
Account: The separate Eligible Account or Accounts created
and maintained by the Master Servicer
pursuant to Section 3.05 with a
depository institution in the name of the
Master Servicer for the benefit of
the Trustee on behalf of Certificateholders
and designated "Countrywide Home
Loans Servicing LP, in trust for the
registered holders of Alternative Loan
Trust 2005-53T2, Mortgage Pass-Through
Certificates Series 2005-53T2."
Certificate
Balance: With respect to any Certificate, other than a
Notional Amount Certificates, at any date,
the maximum dollar amount of
principal to which the Holder thereof is
then entitled hereunder, such amount
being equal to the Denomination thereof (A)
plus any increase in the
Certificate Balance of such Certificate
pursuant to Section 4.02 due to the
receipt of Subsequent Recoveries, (B) minus
the sum of (i) all distributions
of principal previously made with respect
thereto and (ii) all Realized Losses
allocated thereto and, in the case of any
Subordinated Certificates, all other
reductions in Certificate Balance
previously allocated thereto pursuant to
Section 4.04 and (C) in the case of any
Class of Accrual Certificates,
increased by the Accrual Amount added to
the Class Certificate Balance of such
Class prior to such date. The Notional
Amount Certificates have no Certificate
Balances.
Certificate
Group: The Group 1 Certificates or Group 2 Certificates, as
the context requires.
Certificate
Owner: With respect to a Book-Entry Certificate, the Person
who is the beneficial owner of such
Book-Entry Certificate. For the purposes
of this Agreement, in order for a
Certificate Owner to enforce any of its
rights hereunder, it shall first have to
provide evidence of its beneficial
ownership interest in a Certificate that is
reasonably satisfactory to the
Trustee, the Depositor, and/or the Master
Servicer, as applicable.
Certificate
Register: The register maintained pursuant to Section 5.02
hereof.
Certificateholder or Holder: The person in whose name a Certificate
is
registered in the Certificate Register,
except that, solely for the purpose of
giving any consent pursuant to this
Agreement, any Certificate registered in
the name of the Depositor or any affiliate
of the Depositor shall be deemed
not to be Outstanding and the Percentage
Interest evidenced thereby shall not
be taken into account in determining
whether the requisite amount of
Percentage Interests necessary to effect
such consent has been obtained;
provided, however, that if any such Person
(including the Depositor) owns 100%
of the Percentage Interests evidenced by a
Class of Certificates, such
Certificates shall be deemed to be
Outstanding for purposes of any provision
hereof (other than the second sentence of
Section 10.01 hereof) that requires
the consent of the Holders of Certificates
of a particular Class as a
condition to the taking of any action
hereunder. The Trustee is entitled to
rely conclusively on a certification of the
Depositor or any affiliate of
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<PAGE>
the Depositor in determining which
Certificates are registered in the name of
an affiliate of the Depositor.
Class: All
Certificates bearing the same Class designation as set forth
in the Preliminary Statement.
Class C
Distribution Account: The separate Eligible Account created and
maintained by the Trustee pursuant to
Section 3.05 in the name of the Trustee
for the benefit of the Certificateholders
and designated "The Bank of New York
in trust for registered holders of
Alternative Loan Trust 2005-53T2 Mortgage
Pass-Through Certificates, Series
2005-53T2." Funds in the Class C
Distribution Account shall be held in trust
for the Class C Certificateholders
for the uses and purposes set forth in this
Agreement.
Class
Certificate Balance: With respect to any Class and as to any
date
of determination, the aggregate of the
Certificate Balances of all
Certificates of such Class as of such
date.
Class Interest
Shortfall: As to any Distribution Date and Class, the
amount by which the amount described in
clause (i) of the definition of Class
Optimal Interest Distribution Amount for
such Class exceeds the amount of
interest actually distributed on such Class
on such Distribution Date pursuant
to such clause (i).
Class Optimal
Interest Distribution Amount: With respect to any
Distribution Date and interest bearing
Class or Component, the sum of (i) one
month's interest accrued during the related
Interest Accrual Period at the
Pass-Through Rate for such Class on the
related Class Certificate Balance,
Component Balance, Notional Amount or
Component Notional Amount, as
applicable, subject to reduction as
provided in Section 4.02(e) and (ii) any
Class Unpaid Interest Amounts for such
Class or Component.
Class PO
Deferred Amount: As to any Distribution Date, the aggregate of
the applicable PO Percentage of each
Realized Loss on a Discount Mortgage Loan
to be allocated to the Class PO
Certificates on such Distribution Date on or
prior to the Senior Credit Support
Depletion Date or previously allocated to
the Class PO Certificates and not yet paid
to the Holders of the Class PO
Certificates.
Class
Subordination Percentage: With respect to any Distribution Date
and
each Class of Subordinated Certificates,
the quotient (expressed as a
percentage) of (a) the Class Certificate
Balance of such Class of Certificates
immediately prior to such Distribution Date
divided by (b) the aggregate of
the Class Certificate Balances immediately
prior to such Distribution Date of
all Classes of Certificates.
Class Unpaid
Interest Amounts: As to any Distribution Date and Class of
interest bearing Certificates, the amount
by which the aggregate Class
Interest Shortfalls for such Class on prior
Distribution Dates exceeds the
amount distributed on such Class on prior
Distribution Dates pursuant to
clause (ii) of the definition of Class
Optimal Interest Distribution Amount.
Closing Date:
September 29, 2005.
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<PAGE>
Code: The
Internal Revenue Code of 1986, including any successor or
amendatory provisions.
COFI: The
Monthly Weighted Average Cost of Funds Index for the Eleventh
District Savings Institutions published by
the Federal Home Loan Bank of San
Francisco.
COFI
Certificates: As specified in the Preliminary Statement.
Collateral
Allocation Group: Either of Collateral Allocation Group 1 or
Collateral Allocation Group 2, as
applicable.
Collateral
Allocation Group 1: The respective Applicable Fractions of the
Mortgage Loans so identified on the
Mortgage Loan Schedule.
Collateral
Allocation Group 1 Mortgage Loans: The Mortgage Loans or
Applicable Fractions thereof in Collateral
Allocation Group 1.
Collateral
Allocation Group 2: The respective Applicable Fractions of the
Mortgage Loans so identified on the
Mortgage Loan Schedule.
Collateral
Allocation Group 2 Mortgage Loans: The Mortgage Loans or
Applicable Fractions thereof in Collateral
Allocation Group 2.
Collateral
Allocation Group Principal Balance: As to any Distribution
Date and Collateral Allocation Group, the
aggregate of the Applicable
Fractions of the Stated Principal Balances
of the Mortgage Loans related to
that Collateral Allocation Group as of the
Due Date in the month preceding the
month of the Distribution Date, after
giving effect to Principal Prepayments
received in the Prepayment Period related
to such Due Date.
Compensating
Interest: As to any Distribution Date, an amount equal to
the product of one-twelfth of 0.125% and
the aggregate Stated Principal
Balance of the Mortgage Loans as of the Due
Date in the prior calendar month.
Component: As
specified in the Preliminary Statement.
Component
Balance: With respect to any Component and any Distribution
Date, the Initial Component Balance thereof
on the Closing Date, (A) plus any
increase in the Component Balance of such
Component pursuant to Section 4.02
due to the receipt of Subsequent
Recoveries, (B) minus the sum of all amounts
applied in reduction of the principal
balance of such Component and Realized
Losses allocated thereto on previous
Distribution Dates.
Component
Certificates: As specified in the Preliminary Statement.
Component
Notional Amount: Not applicable.
Confirmation:
With respect to the Class 2-A-6 Certificates, the
Confirmation (reference #FXNEC7402) dated
September 29, 2005, evidencing a
transaction between the applicable Corridor
Contract Counterparty and
Countrywide Home Loans, Inc.
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<PAGE>
Coop Shares:
Shares issued by a Cooperative Corporation.
Cooperative
Corporation: The entity that holds title (fee or an
acceptable leasehold estate) to the real
property and improvements
constituting the Cooperative Property and
which governs the Cooperative
Property, which Cooperative Corporation
must qualify as a Cooperative Housing
Corporation under Section 216 of the
Code.
Cooperative
Loan: Any Mortgage Loan secured by Coop Shares and a
Proprietary Lease.
Cooperative
Property: The real property and improvements owned by the
Cooperative Corporation, including the
allocation of individual dwelling units
to the holders of the Coop Shares of the
Cooperative Corporation.
Cooperative
Unit: A single family dwelling located in a Cooperative
Property.
Corporate Trust
Office: The designated office of the Trustee in the State
of New York at which at any particular time
its corporate trust business with
respect to this Agreement shall be
administered, which office at the date of
the execution of this Agreement is located
at 101 Barclay Street, 8W, New
York, New York 10286 (Attn: Mortgage-Backed
Securities Group, CWALT, Inc.
Series 2005-53T2, facsimile no. (212)
815-3986), and which is the address to
which notices to and correspondence with
the Trustee should be directed.
Corridor
Contract: With respect to the Class 2-A-6 Certificates, the
transaction evidenced by the Confirmation
(assigned to the Trustee pursuant to
the Assignment Agreement), a form of which
is attached hereto as Exhibit R.
Corridor
Contract Counterparty: Bear Stearns Financial Products, Inc.
Corridor
Contract Reserve Fund: The separate fund created and initially
maintained by the Trustee pursuant to
Section 3.05(i) in the name of the
Trustee for the benefit of the Holders of
the Class 2-A-6 Certificates and
designated "The Bank of New York in trust
for registered holders of CWALT,
Inc., Alternative Loan Trust 2005-53T2,
Mortgage Pass-Through Certificates,
Series 2005-53T2." Funds in the Corridor
Contract Reserve Fund shall be held
in trust for the Holders of the Class 2-A-6
Certificates for the uses and
purposes set forth in this Agreement. For
all federal income tax purposes, the
Corridor Contract Reserve Fund will be
beneficially owned by Bear, Stearns &
Co. Inc.
Corridor
Contract Scheduled Termination Date: With respect to the Class
2-A-6 Certificates, the Distribution Date
in April 2014.
Countrywide:
Countrywide Home Loans, Inc., a New York corporation, and
its successors and assigns in its capacity
as the seller of the Countrywide
Mortgage Loans to the Depositor.
Countrywide
Mortgage Loans: The Mortgage Loans identified as such on the
Mortgage Loan Schedule for which
Countrywide is the applicable Seller.
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<PAGE>
Countrywide
Servicing: Countrywide Home Loans Servicing LP, a Texas
limited partnership, and its successors and
assigns.
Cross-Over
Situation: For any Distribution Date and for each Collateral
Allocation Group (after taking into account
principal distributions on such
Distribution Date) a situation in which the
Class A and Class B Interests
corresponding to any Collateral Allocation
Group are in the aggregate less
than 1% of the Subordinate Portion of the
Collateral Allocation Group to which
they correspond.
Cut-off Date:
With respect to any Mortgage Loan, the later of (i) the
date of origination of such Mortgage Loan
and (ii) September 1, 2005.
Cut-off Date
Pool Principal Balance: $335,588,757.99.
Cut-off Date
Principal Balance: As to any Mortgage Loan, the Stated
Principal Balance thereof as of the close
of business on the Cut-off Date.
Debt Service
Reduction: With respect to any Mortgage Loan, a reduction by
a court of competent jurisdiction in a
proceeding under the Bankruptcy Code in
the Scheduled Payment for such Mortgage
Loan which became final and
non-appealable, except such a reduction
resulting from a Deficient Valuation
or any reduction that results in a
permanent forgiveness of principal.
Deceased Holder:
Not applicable.
Defective
Mortgage Loan: Any Mortgage Loan which is required to be
repurchased pursuant to Section 2.02 or
2.03.
Deficient
Valuation: With respect to any Mortgage Loan, a valuation by a
court of competent jurisdiction of the
Mortgaged Property in an amount less
than the then-outstanding indebtedness
under the Mortgage Loan, or any
reduction in the amount of principal to be
paid in connection with any
Scheduled Payment that results in a
permanent forgiveness of principal, which
valuation or reduction results from an
order of such court which is final and
non-appealable in a proceeding under the
Bankruptcy Code.
Definitive
Certificates: Any Certificate evidenced by a Physical
Certificate and any Certificate issued in
lieu of a Book-Entry Certificate
pursuant to Section 5.02(e).
Delay
Certificates: As specified in the Preliminary Statement.
Delay Delivery
Certification: As defined in Section 2.02(a) hereof.
Delay Delivery
Mortgage Loans: The Mortgage Loans for which all or a
portion of a related Mortgage File is not
delivered to Trustee on the Closing
Date. The number of Delay Delivery Mortgage
Loans shall not exceed 50% of the
aggregate number of Mortgage Loans as of
the Closing Date. To the extent that
Countrywide Home Loans Servicing LP shall
be in possession of any Mortgage
Files with respect to any Delay Delivery
Mortgage Loan, until delivery of such
Mortgage File to the Trustee as provided in
Section 2.01, Countrywide Home
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<PAGE>
Loans Servicing LP shall hold such files as
Master Servicer hereunder, as
agent and in trust for the Trustee.
Deleted Mortgage
Loan: As defined in Section 2.03(c) hereof.
Denomination:
With respect to each Certificate, the amount set forth on
the face thereof as the "Initial
Certificate Balance of this Certificate" or
the "Initial Notional Amount of this
Certificate" or, if neither of the
foregoing, the Percentage Interest
appearing on the face thereof.
Depositor:
CWALT, Inc., a Delaware corporation, or its successor in
interest.
Depository: The
initial Depository shall be The Depository Trust Company,
the nominee of which is CEDE & Co., as
the registered Holder of the Book-Entry
Certificates. The Depository shall at all
times be a "clearing corporation" as
defined in Section 8-102(a)(5) of the
Uniform Commercial Code of the State of
New York.
Depository
Participant: A broker, dealer, bank or other financial
institution or other Person for whom from
time to time a Depository effects
book-entry transfers and pledges of
securities deposited with the Depository.
Determination
Date: As to any Distribution Date, the 15th day of the
month in which such Distribution Date
occurs or, if such 15th day is not a
Business Day, the immediately preceding
Business Day.
Discount
Mortgage Loan: Any Mortgage Loan with an Adjusted Net Mortgage
Rate that is less than the Required Coupon
for Collateral Allocation Group 1.
Distribution
Account: The separate Eligible Account created and
maintained by the Trustee pursuant to
Section 3.05 in the name of the Trustee
for the benefit of the Certificateholders
and designated "The Bank of New York
in trust for registered holders of
Alternative Loan Trust 2005-53T2 Mortgage
Pass-Through Certificates, Series
2005-53T2." Funds in the Distribution
Account shall be held in trust for the
Certificateholders for the uses and
purposes set forth in this Agreement.
Distribution
Account Deposit Date: As to any Distribution Date, 12:30
p.m. Pacific time on the Business Day
immediately preceding such Distribution
Date.
Distribution
Date: The 25th day of each calendar month after the initial
issuance of the Certificates, or if such
25th day is not a Business Day, the
next succeeding Business Day, commencing in
October 2005.
Due Date: With
respect to any Distribution Date, the first day of the
calendar month in which that Distribution
Date occurs.
Due Period: With
respect to a Mortgage Loan, the period beginning on the
second day of the calendar month preceding
the month in which such
Distribution Date occurs and ending on the
first day of the calendar month in
which such Distribution Date occurs.
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<PAGE>
Eligible
Account: Any of (i) an account or accounts maintained with a
federal or state chartered depository
institution or trust company, the
short-term unsecured debt obligations of
which (or, in the case of a
depository institution or trust company
that is the principal subsidiary of a
holding company, the debt obligations of
such holding company) have the
highest short-term ratings of Moody's or
Fitch and one of the two highest
short-term ratings of S&P, if S&P
is a Rating Agency, at the time any amounts
are held on deposit therein, or (ii) an
account or accounts in a depository
institution or trust company in which such
accounts are insured by the FDIC
(to the limits established by the FDIC) and
the uninsured deposits in which
accounts are otherwise secured such that,
as evidenced by an Opinion of
Counsel delivered to the Trustee and to
each Rating Agency, the
Certificateholders have a claim with
respect to the funds in such account or a
perfected first priority security interest
against any collateral (which shall
be limited to Permitted Investments)
securing such funds that is superior to
claims of any other depositors or creditors
of the depository institution or
trust company in which such account is
maintained, or (iii) a trust account or
accounts maintained with (a) the trust
department of a federal or state
chartered depository institution or (b) a
trust company, acting in its
fiduciary capacity or (iv) any other
account acceptable to each Rating Agency.
Eligible Accounts may bear interest, and
may include, if otherwise qualified
under this definition, accounts maintained
with the Trustee.
Eligible
Repurchase Month: As defined in Section 3.11 hereof.
ERISA: The
Employee Retirement Income Security Act of 1974, as amended.
ERISA-Qualifying
Underwriting: A best efforts or firm commitment
underwriting or private placement that
meets the requirements of an
Underwriter's Exemption.
ERISA-Restricted
Certificate: As specified in the Preliminary Statement.
Escrow Account:
The Eligible Account or Accounts established and
maintained pursuant to Section 3.06(a)
hereof.
Event of
Default: As defined in Section 7.01 hereof.
Excess Proceeds:
With respect to any Liquidated Mortgage Loan, the
amount, if any, by which the sum of any
Liquidation Proceeds received with
respect to such Mortgage Loan during the
calendar month in which such Mortgage
Loan became a Liquidated Mortgage Loan plus
any Subsequent Recoveries received
with respect to such Mortgage Loan, net of
any amounts previously reimbursed
to the Master Servicer as Nonrecoverable
Advance(s) with respect to such
Mortgage Loan pursuant to Section
3.08(a)(iii), exceeds (i) the unpaid
principal balance of such Liquidated
Mortgage Loan as of the Due Date in the
month in which such Mortgage Loan became a
Liquidated Mortgage Loan plus (ii)
accrued interest at the Mortgage Rate from
the Due Date as to which interest
was last paid or advanced (and not
reimbursed) to Certificateholders up to the
Due Date applicable to the Distribution
Date immediately following the
calendar month during which such
liquidation occurred.
Expense Rate: As
to each Mortgage Loan, the Master Servicing Fee Rate.
FDIC: The
Federal Deposit Insurance Corporation, or any successor
thereto.
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<PAGE>
FHLMC: The
Federal Home Loan Mortgage Corporation, a corporate
instrumentality of the United States
created and existing under Title III of
the Emergency Home Finance Act of 1970, as
amended, or any successor thereto.
Final
Certification: As defined in Section 2.02(a) hereof.
FIRREA: The
Financial Institutions Reform, Recovery, and Enforcement Act
of 1989.
Fitch: Fitch,
Inc., or any successor thereto. If Fitch is designated as a
Rating Agency in the Preliminary Statement,
for purposes of Section 10.05(b)
the address for notices to Fitch shall be
Fitch, Inc., One State Street Plaza,
New York, New York 10004, Attention:
Residential Mortgage Surveillance Group,
or such other address as Fitch may
hereafter furnish to the Depositor and the
Master Servicer.
FNMA: The
Federal National Mortgage Association, a federally chartered
and privately owned corporation organized
and existing under the Federal
National Mortgage Association Charter Act,
or any successor thereto.
Group 1 Senior
Certificates: As specified in the Preliminary Statement.
Group 2 Senior
Certificates: As specified in the Preliminary Statement.
Index: With
respect to any Interest Accrual Period for the COFI
Certificates, if any, the then-applicable
index used by the Trustee pursuant
to Section 4.07 to determine the applicable
Pass-Through Rate for such
Interest Accrual Period for the COFI
Certificates.
Indirect
Participant: A broker, dealer, bank or other financial
institution or other Person that clears
through or maintains a custodial
relationship with a Depository
Participant.
Initial
Certification: As defined in Section 2.02(a) hereof.
Initial
Component Balance: As specified in the Preliminary Statement.
Insurance
Policy: With respect to any Mortgage Loan included in the Trust
Fund, any insurance policy, including all
riders and endorsements thereto in
effect, including any replacement policy or
policies for any Insurance
Policies.
Insurance
Proceeds: Proceeds paid by an insurer pursuant to any Insurance
Policy, in each case other than any amount
included in such Insurance Proceeds
in respect of Insured Expenses.
Insured
Expenses: Expenses covered by an Insurance Policy or any other
insurance policy with respect to the
Mortgage Loans.
Interest Accrual
Period: With respect to each Class of Delay
Certificates, its corresponding REMIC
Regular Interest(s) and any Distribution
Date, the calendar month prior to the month
of such Distribution Date. With
respect to any Class of Non-Delay
Certificates, its corresponding REMIC
Regular Interest(s) and any Distribution
Date, the one month period
26
<PAGE>
commencing on the 25th day of the month
preceding the month in which such
Distribution Date occurs and ending on the
24th day of the month in which such
Distribution Date occurs.
Interest
Determination Date: With respect to (a) any Interest Accrual
Period for any LIBOR Certificates and (b)
any Interest Accrual Period for the
COFI Certificates for which the applicable
Index is LIBOR, the second Business
Day prior to the first day of such Interest
Accrual Period.
Latest Possible
Maturity Date: The Distribution Date following the third
anniversary of the scheduled maturity date
of the Mortgage Loan having the
latest scheduled maturity date as of the
Cut-off Date.
Lender PMI
Mortgage Loan: Certain Mortgage Loans as to which the lender
(rather than the borrower) acquires the
Primary Insurance Policy and charges
the related borrower an interest
premium.
LIBOR: The
London interbank offered rate for one-month United States
dollar deposits calculated in the manner
described in Section 4.08.
LIBOR
Certificates: As specified in the Preliminary Statement.
Liquidated
Mortgage Loan: With respect to any Distribution Date, a
defaulted Mortgage Loan (including any REO
Property) which was liquidated in
the calendar month preceding the month of
such Distribution Date and as to
which the Master Servicer has determined
(in accordance with this Agreement)
that it has received all amounts it expects
to receive in connection with the
liquidation of such Mortgage Loan,
including the final disposition of an REO
Property.
Liquidation
Proceeds: Amounts, including Insurance Proceeds, received in
connection with the partial or complete
liquidation of defaulted Mortgage
Loans, whether through trustee's sale,
foreclosure sale or otherwise or
amounts received in connection with any
condemnation or partial release of a
Mortgaged Property and any other proceeds
received in connection with an REO
Property, less the sum of related
unreimbursed Master Servicing Fees,
Servicing Advances and Advances.
Living Holders:
Not applicable.
Loan-to-Value
Ratio: With respect to any Mortgage Loan and as to any date
of determination, the fraction (expressed
as a percentage) the numerator of
which is the principal balance of the
related Mortgage Loan at such date of
determination and the denominator of which
is the Appraised Value of the
related Mortgaged Property.
Lost Mortgage
Note: Any Mortgage Note the original of which was
permanently lost or destroyed and has not
been replaced.
Maintenance:
With respect to any Cooperative Unit, the rent paid by the
Mortgagor to the Cooperative Corporation
pursuant to the Proprietary Lease.
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Majority in
Interest: As to any Class of Regular Certificates, the
Holders of Certificates of such Class
evidencing, in the aggregate, at least
51% of the Percentage Interests evidenced
by all Certificates of such Class.
Master REMIC: As
described in the Preliminary Statement.
Master Servicer:
Countrywide Home Loans Servicing LP, a Texas limited
partnership, and its successors and
assigns, in its capacity as master
servicer hereunder.
Master Servicer
Advance Date: As to any Distribution Date, 12:30 p.m.
Pacific time on the Business Day
immediately preceding such Distribution Date.
Master Servicer
Remittance Date: As to any Distribution Date, the 18th
day of the calendar month in which such
Distribution Date occurs, or if such
18th day is not a Business Day, the next
succeeding Business Day.
Master Servicing
Fee: As to each Mortgage Loan and any Distribution Date,
an amount payable out of each full payment
of interest received on such
Mortgage Loan and equal to one-twelfth of
the Master Servicing Fee Rate
multiplied by the Stated Principal Balance
of such Mortgage Loan as of the Due
Date in the month preceding the month of
such Distribution Date, subject to
reduction as provided in Section 3.14.
Master Servicing
Fee Rate: With respect to each Mortgage Loan, 0.20% per
annum.
MERS: Mortgage
Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of
the State of Delaware, or any
successor thereto.
MERS Mortgage
Loan: Any Mortgage Loan registered with MERS on the MERS
System.
MERS(R) System:
The system of recording transfers of mortgages
electronically maintained by MERS.
MIN: The
Mortgage Identification Number for any MERS Mortgage Loan.
Minimum Bid
Price: An amount equal to (1) the aggregate Class Certificate
Balance of the Certificates, (2) interest
accrued and unpaid on the
Certificates and (3) any unreimbursed
Advances, Servicing Advances, fees and
expenses of the Master Servicer and the
Trustee (including any expenses
related to any auctions).
MOM Loan: Any
Mortgage Loan as to which MERS is acting as mortgagee,
solely as nominee for the originator of
such Mortgage Loan and its successors
and assigns.
Monthly
Statement: The statement delivered to the Certificateholders
pursuant to Section 4.06.
Moody's: Moody's
Investors Service, Inc., or any successor thereto. If
Moody's is designated as a Rating Agency in
the Preliminary Statement, for
purposes of Section 10.05(b) the
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address for notices to Moody's shall be
Moody's Investors Service, Inc., 99
Church Street, New York, New York 10007,
Attention: Residential Pass-Through
Monitoring, or such other address as
Moody's may hereafter furnish to the
Depositor or the Master Servicer.
Mortgage: The
mortgage, deed of trust or other instrument creating a
first lien on an estate in fee simple or
leasehold interest in real property
securing a Mortgage Note.
Mortgage File:
The mortgage documents listed in Section 2.01 hereof
pertaining to a particular Mortgage Loan
and any additional documents
delivered to the Trustee to be added to the
Mortgage File pursuant to this
Agreement.
Mortgage Loan
Schedule: The list of Mortgage Loans (as from time to time
amended by the Master Servicer to reflect
the addition of Substitute Mortgage
Loans and the deletion of Deleted Mortgage
Loans pursuant to the provisions of
this Agreement) transferred to the Trustee
as part of the Trust Fund and from
time to time subject to this Agreement,
attached hereto as Schedule I, setting
forth the following information with
respect to each Mortgage Loan:
(i)
the loan number;
(ii)
the Mortgagor's name and the street address of the Mortgaged
Property, including the zip code;
(iii) the maturity date;
(iv)
the original principal balance;
(v)
the Cut-off Date Principal Balance;
(vi)
the first payment date of the Mortgage Loan;
(vii) the Scheduled Payment in effect as of the Cut-off Date;
(viii) the Loan-to-Value Ratio at origination;
(ix)
a code indicating whether the residential dwelling at the time
of
origination was represented to be owner-occupied;
(x)
a code indicating whether the residential dwelling is either (a)
a
detached single family dwelling (b) a dwelling in a de minimis PUD,
(c)
a
condominium unit or PUD (other than a de minimis PUD), (d) a two-
to
four-unit residential property or (e) a Cooperative Unit;
(xi)
the Mortgage Rate;
(xii) a code indicating whether the Mortgage Loan is a
Countrywide
Mortgage Loan, a Park Granada Mortgage Loan, a Park Monaco
Mortgage
Loan
or a Park Sienna Mortgage Loan;
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(xiii) a code indicating whether the Mortgage Loan is a Lender
PMI
Mortgage Loan and, in the case of any Lender PMI Mortgage Loan,
a
percentage representing the amount of the related interest
premium
charged to the borrower;
(xiv) the purpose for the Mortgage Loan;
(xv)
the type of documentation program pursuant to which the
Mortgage
Loan
was originated;
(xvi) a code indicating whether the Mortgage Loan is a MERS
Mortgage
Loan; and
(xvii) a code identifying the related Collateral Allocation Group
or
Collateral Allocation Groups for such Mortgage Loan and the
Applicable
Fraction(s) of such Mortgage Loan in the applicable Collateral
Allocation Group(s).
Mortgage Loans:
Such of the mortgage loans as from time to time are
transferred and assigned to the Trustee
pursuant to the provisions hereof and
that are held as a part of the Trust Fund
(including any REO Property), the
mortgage loans so held being identified in
the Mortgage Loan Schedule,
notwithstanding foreclosure or other
acquisition of title of the related
Mortgaged Property.
Mortgage Note:
The original executed note or other evidence of
indebtedness evidencing the indebtedness of
a Mortgagor under a Mortgage Loan.
Mortgage Pool:
The aggregate of the Mortgage Loans identified in the
Mortgage Loan Schedule.
Mortgage Rate:
The annual rate of interest borne by a Mortgage Note from
time to time, net of any interest premium
charged by the mortgagee to obtain
or maintain any Primary Insurance
Policy.
Mortgaged
Property: The underlying property securing a Mortgage Loan,
which, with respect to a Cooperative Loan,
is the related Coop Shares and
Proprietary Lease.
Mortgagor: The
obligor(s) on a Mortgage Note.
National Cost of
Funds Index: The National Monthly Median Cost of Funds
Ratio to SAIF-Insured Institutions
published by the Office of Thrift
Supervision.
Net Prepayment
Interest Shortfalls: As to any Distribution Date, the
amount by which the aggregate of Prepayment
Interest Shortfalls during the
related Prepayment Period exceeds an amount
equal to the Compensating Interest
and Distribution Date.
Non-Delay
Certificates: As specified in the Preliminary Statement.
Non-Discount
Mortgage Loan: Any Mortgage Loan with an Adjusted Net
Mortgage Rate that is greater than or equal
to the Required Coupon for
Collateral Allocation Group 1.
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Non-PO Formula
Principal Amount: As to any Distribution Date and
Collateral Allocation Group, the sum of (i)
the applicable Non-PO Percentage
of the Applicable Fraction of each of the
following: (a) the principal portion
of each Scheduled Payment (without giving
effect to any reductions thereof
caused by any Debt Service Reductions or
Deficient Valuations) due on each
Mortgage Loan on the related Due Date, (b)
the Stated Principal Balance of
each Mortgage Loan that was repurchased by
a Seller or purchased by the Master
Servicer pursuant to this Agreement as of
such Distribution Date, (c) the
Substitution Adjustment Amount in
connection with any Deleted Mortgage Loan
received with respect to such Distribution
Date, (d) any Insurance Proceeds or
Liquidation Proceeds allocable to
recoveries of principal of Mortgage Loans
that are not yet Liquidated Mortgage Loans
received during the calendar month
preceding the month of such Distribution
Date, (e) with respect to each
Mortgage Loan that became a Liquidated
Mortgage Loan during the calendar month
preceding the month of such Distribution
Date, the amount of the Liquidation
Proceeds allocable to principal received
during the calendar month preceding
the month of such Distribution Date, and
(f) all Principal Prepayments
received during the related Prepayment
Period, and (ii) (A) any Subsequent
Recoveries received on the Mortgage Loans
during the calendar month preceding
the month of such Distribution Date, or (B)
with respect to Subsequent
Recoveries attributable to a Discount
Mortgage Loan which incurred a Realized
Loss after the Senior Credit Support
Depletion Date, the Non-PO Percentage of
any Subsequent Recoveries received during
the calendar month preceding the
month of such Distribution Date.
Non-PO
Percentage: As to any Discount Mortgage Loan, a fraction
(expressed as a percentage) the numerator
of which is the Adjusted Net
Mortgage Rate of such Discount Mortgage
Loan and the denominator of which is
the Required Coupon for Collateral
Allocation Group 1. As to any Non-Discount
Mortgage Loan, 100%.
Non-PO Pool
Balance: As to any Collateral Allocation Group and Due Date,
the amount equal to the excess, if any, of
(i) the aggregate of the Applicable
Fractions of the Stated Principal Balance
of all Mortgage Loans related to
that Collateral Allocation Group over (ii)
in the case of Collateral
Allocation Group 1, the sum of the PO
Percentage of the Stated Principal
Balance of each Discount Mortgage Loan.
Nonrecoverable
Advance: Any portion of an Advance previously made or
proposed to be made by the Master Servicer
that, in the good faith judgment of
the Master Servicer, will not be ultimately
recoverable by the Master Servicer
from the related Mortgagor, related
Liquidation Proceeds, Subsequent
Recoveries or otherwise.
Notice of Final
Distribution: The notice to be provided pursuant to
Section 9.02 to the effect that final
distribution on any of the Certificates
shall be made only upon presentation and
surrender thereof.
Notional Amount:
With respect to any Distribution Date and (i) the Class
2-A-7 Certificates, an amount equal to the
Class Certificate Balance of the
Class 2-A-6 Certificates immediately prior
to such Distribution Date, (ii) the
Class 2-A-8 Certificates, an amount equal
to the aggregate Class Certificate
Balance of the Class 2 A 2, Class 2-A-3,
Class 2-A-4 and Class 2-A-5
Certificates immediately prior to such
Distribution Date, and (iii) the Class
X Certificates, an amount equal to the
aggregate of the Stated Principal
Balance of each Mortgage Loan with an
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Adjusted Net Mortgage Rate greater than or
equal to 6.00% as of the Due Date
in the month preceding the month of that
Distribution Date (after giving
effect to Principal Prepayments received in
the Prepayment Period related to
that Due Date).
Notional Amount
Certificates: As specified in the Preliminary Statement.
Offered
Certificates: As specified in the Preliminary Statement.
Officer's
Certificate: A certificate (i) in the case of the Depositor,
signed by the Chairman of the Board, the
Vice Chairman of the Board, the
President, a Managing Director, a Vice
President (however denominated), an
Assistant Vice President, the Treasurer,
the Secretary, or one of the
Assistant Treasurers or Assistant
Secretaries of the Depositor, (ii) in the
case of the Master Servicer, signed by the
President, an Executive Vice
President, a Vice President, an Assistant
Vice President, the Treasurer, or
one of the Assistant Treasurers or
Assistant Secretaries of Countrywide GP,
Inc., its general partner or (iii) if
provided for in this Agreement, signed
by a Servicing Officer, as the case may be,
and delivered to the Depositor and
the Trustee, as the case may be, as
required by this Agreement.
Opinion of
Counsel: A written opinion of counsel, who may be counsel for
a Seller, the Depositor or the Master
Servicer, including, in-house counsel,
reasonably acceptable to the Trustee;
provided, however, that with respect to
the interpretation or application of the
REMIC Provisions, such counsel must
(i) in fact be independent of a Seller, the
Depositor and the Master Servicer,
(ii) not have any direct financial interest
in a Seller, the Depositor or the
Master Servicer or in any affiliate
thereof, and (iii) not be connected with a
Seller, the Depositor or the Master
Servicer as an officer, employee,
promoter, underwriter, trustee, partner,
director or person performing similar
functions.
Optional
Termination: The termination of the trust created hereunder in
connection with the purchase of the
Mortgage Loans pursuant to Section 9.01(a)
hereof.
Original
Applicable Credit Support Percentage: With respect to each of
the following Classes of Subordinated
Certificates, the corresponding
percentage described below, as of the
Closing Date:
Class M.......................6.70%
Class B-1.....................2.60%
Class B-2.....................1.70%
Class B-3.....................1.10%
Class B-4.....................0.60%
Class B-5.....................0.25%
Original
Mortgage Loan: The mortgage loan refinanced in connection with
the origination of a Refinancing Mortgage
Loan.
Original
Subordinate Principal Balance: The aggregate of the Class
Certificate Balances of the Subordinated
Certificates as of the Closing Date.
OTS: The Office
of Thrift Supervision.
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Outside
Reference Date: As to any Interest Accrual Period for the COFI
Certificates, the close of business on the
tenth day thereof.
Outstanding:
With respect to the Certificates as of any date of
determination, all Certificates theretofore
executed and authenticated under
this Agreement except:
(i)
Certificates theretofore canceled by the Trustee or delivered
to
the
Trustee for cancellation; and
(ii)
Certificates in exchange for which or in lieu of which other
Certificates have been executed and delivered by the Trustee
pursuant
to
this Agreement.
Outstanding
Mortgage Loan: As of any Due Date, a Mortgage Loan with a
Stated Principal Balance greater than zero,
which was not the subject of a
Principal Prepayment in Full as of the last
day of the Prepayment Period
related to such Due Date and which did not
become a Liquidated Mortgage Loan
prior to such Due Date.
Overcollateralized Group: Not applicable.
Ownership
Interest: As to any Residual Certificate, any ownership
interest in such Certificate including any
interest in such Certificate as the
Holder thereof and any other interest
therein, whether direct or indirect,
legal or beneficial.
Park Granada:
Park Granada LLC, a Delaware limited liability company, and
its successors and assigns, in its capacity
as the seller of the Park Granada
Mortgage Loans to the Depositor.
Park Granada
Mortgage Loans: The Mortgage Loans identified as such on the
Mortgage Loan Schedule for which Park
Granada is the applicable Seller.
Park Monaco:
Park Monaco Inc., a Delaware corporation, and its successors
and assigns, in its capacity as the seller
of the Park Monaco Mortgage Loans
to the Depositor.
Park Monaco
Mortgage Loans: The Mortgage Loans identified as such on the
Mortgage Loan Schedule for which Park
Monaco is the applicable Seller.
Park Sienna:
Park Sienna LLC, a Delaware limited liability company, and
its successors and assigns, in its capacity
as the seller of the Park Sienna
Mortgage Loans to the Depositor.
Park Sienna
Mortgage Loans: The Mortgage Loans identified as such on the
Mortgage Loan Schedule for which Park
Sienna is the applicable Seller.
Pass-Through
Rate: For any interest bearing Class of Certificates or
Component, the per annum rate set forth or
calculated in the manner described
in the Preliminary Statement.
Percentage
Interest: As to any Certificate, the percentage interest
evidenced thereby in distributions required
to be made on the related Class,
such percentage interest being set forth
on
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the face thereof or equal to the percentage
obtained by dividing the
Denomination of such Certificate by the
aggregate of the Denominations of all
Certificates of the same Class.
Permitted
Investments: At any time, any one or more of the following
obligations and securities:
(i)
obligations of the United States or any agency thereof,
provided
such
obligations are backed by the full faith and credit of the
United
States;
(ii)
general obligations of or obligations guaranteed by any state
of
the
United States or the District of Columbia receiving the highest
long-term debt rating of each Rating Agency, or such lower rating
as
will
not result in the downgrading or withdrawal of the ratings then
assigned to the Certificates by each Rating Agency;
(iii) commercial or finance company paper which is then receiving
the
highest commercial or finance company paper rating of each
Rating
Agency, or such lower rating as will not result in the downgrading
or
withdrawal of the ratings then assigned to the Certificates by
each
Rating Agency;
(iv) certificates of
deposit, demand or time deposits, or bankers'
acceptances issued by any depository institution or trust
company
incorporated under the laws of the United States or of any
state
thereof and subject to supervision and examination by federal
and/or
state banking authorities, provided that the commercial paper
and/or
long
term unsecured debt obligations of such depository institution
or
trust company (or in the case of the principal depository
institution
in a
holding company system, the commercial paper or long-term
unsecured debt obligations of such holding company, but only if
Moody's
is
not a Rating Agency) are then rated one of the two highest
long-term
and
the highest short-term ratings of each Rating Agency for such
securities, or such lower ratings as will not result in the
downgrading
or
withdrawal of the rating then assigned to the Certificates by
either
Rating Agency;
(v)
repurchase obligations with respect to any security described
in
clauses (i) and (ii) above, in either case entered into with a
depository institution or trust company (acting as principal)
described
in
clause (iv) above;
(vi)
units of a taxable money-market portfolio having the highest
rating assigned by each Rating Agency (except if Fitch is a
Rating
Agency and has not rated the portfolio, the highest rating assigned
by
Moody's) and restricted to obligations issued or guaranteed by
the
United States of America or entities whose obligations are backed
by
the
full faith and credit of the United States of America and
repurchase agreements collateralized by such obligations; and
(vii) such other relatively risk free investments bearing interest
or
sold
at a discount acceptable to each Rating Agency as will not
result
in
the downgrading or withdrawal of the rating then assigned to
the
Certificates by either Rating Agency, as evidenced by a signed
writing
delivered by each Rating Agency
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provided, that no such instrument shall be
a Permitted Investment if such
instrument evidences the right to receive
interest only payments with respect
to the obligations underlying such
instrument.
Permitted
Transferee: Any person other than (i) the United States, any
State or political subdivision thereof, or
any agency or instrumentality of
any of the foregoing, (ii) a foreign
government, International Organization or
any agency or instrumentality of either of
the foregoing, (iii) an
organization (except certain farmers'
cooperatives described in section 521 of
the Code) which is exempt from tax imposed
by Chapter 1 of the Code (including
the tax imposed by section 511 of the Code
on unrelated business taxable
income) on any excess inclusions (as
defined in section 860E(c)(1) of the
Code) with respect to any Residual
Certificate, (iv) rural electric and
telephone cooperatives described in section
1381(a)(2)(C) of the Code, (v) an
"electing large partnership" as defined in
Section 775 of the Code, (vi) a
Person that is not a citizen or resident of
the United States, a corporation,
partnership, or other entity created or
organized in or under the laws of the
United States, any state thereof or the
District of Columbia, or an estate or
trust whose income from sources without the
United States is includible in
gross income for United States federal
income tax purposes regardless of its
connection with the conduct of a trade or
business within the United States or
a trust if a court within the United States
is able to exercise primary
supervision over the administration of the
trust and one or more United States
persons have the authority to control all
substantial decisions of the trust
unless such Person has furnished the
transferor and the Trustee with a duly
completed Internal Revenue Service Form
W-8ECI or any applicable successor
form, and (vii) any other Person so
designated by the Depositor based upon an
Opinion of Counsel that the Transfer of an
Ownership Interest in a Residual
Certificate to such Person may cause any
REMIC hereunder to fail to qualify as
a REMIC at any time that the Certificates
are outstanding. The terms "United
States," "State" and "International
Organization" shall have the meanings set
forth in section 7701 of the Code or
successor provisions. A corporation will
not be treated as an instrumentality of the
United States or of any State or
political subdivision thereof for these
purposes if all of its activities are
subject to tax and, with the exception of
the Federal Home Loan Mortgage
Corporation, a majority of its board of
directors is not selected by such
government unit.
Person: Any
individual, corporation, partnership, joint venture,
association, limited liability company,
joint-stock company, trust,
unincorporated organization or government,
or any agency or political
subdivision thereof.
Physical
Certificate: As specified in the Preliminary Statement.
Planned Balance:
With respect to any group of Planned Principal Classes
or Components in the aggregate and any
Distribution Date appearing in Schedule
V hereto, the Aggregate Planned Balance for
such group and Distribution Date.
With respect to any other Planned Principal
Class or Component and any
Distribution Date appearing in Schedule V
hereto, the applicable amount
appearing opposite such Distribution Date
for such Class or Component.
Planned
Principal Classes: As specified in the Preliminary Statement.
Planned
Principal Components: As specified in the Preliminary
Statement.
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PO Formula
Principal Amount: As to any Distribution Date and the Class PO
Certificates, the sum of (i) the applicable
PO Percentage of the Applicable
Fraction with respect to Collateral
Allocation Group 1 of each of the
following: (a) the principal portion of
each Scheduled Payment (without giving
effect to any reductions thereof caused by
any Debt Service Reductions or
Deficient Valuations) due on each Mortgage
Loan on the related Due Date, (b)
the Stated Principal Balance of each
Mortgage Loan that was repurchased by a
Seller or purchased by the Master Servicer
pursuant to this Agreement as of
such Distribution Date, (c) the
Substitution Adjustment Amount in connection
with any Deleted Mortgage Loan received
with respect to such Distribution
Date, (d) any Insurance Proceeds or
Liquidation Proceeds allocable to
recoveries of principal of Mortgage Loans
that are not yet Liquidated Mortgage
Loans received during the calendar month
preceding the month of such
Distribution Date, (e) with respect to each
Mortgage Loan that became a
Liquidated Mortgage Loan during the month
preceding the calendar month of such
Distribution Date, the amount of
Liquidation Proceeds allocable to principal
received with respect to such Mortgage Loan
during the month preceding the
month of such Distribution Date with
respect to such Mortgage Loan, and (f)
all Principal Prepayments with respect to
the Mortgage Loans received during
the related Prepayment Period, and (ii)
with respect to Subsequent Recoveries
attributable to a Discount Mortgage Loan
which incurred a Realized Loss after
the Senior Credit Support Depletion Date,
the PO Percentage of any such
Subsequent Recoveries received during the
calendar month preceding the month
of such Distribution Date.
PO Percentage:
As to any Discount Mortgage Loan, a fraction (expressed as
a percentage) the numerator of which is the
excess of the Required Coupon for
Collateral Allocation Group 1 over the
Adjusted Net Mortgage Rate of such
Discount Mortgage Loan and the denominator
of which is such Required Coupon.
As to any Non-Discount Mortgage Loan,
0%.
Pool Stated
Principal Balance: The aggregate of the Stated Principal
Balances of the Outstanding Mortgage
Loans.
Prepayment
Interest Shortfall: As to any Distribution Date, any Mortgage
Loan and any Principal Prepayment received
in the portion of the Prepayment
Period occurring in the calendar month
prior to the month of such Distribution
Date, the amount, if any, by which one
month's interest at the related
Mortgage Rate, net of the related Master
Servicing Fee Rate, on such Principal
Prepayment exceeds the amount of interest
paid in connection with such
Principal Prepayment.
Prepayment
Period: As to any Distribution Date, the period beginning on
the second day of the calendar month
preceding the month in which such
Distribution Date occurs and ending on the
first day of the calendar month in
which such Distribution Date occurs.
Prepayment Shift
Percentage: Not applicable.
Primary
Insurance Policy: Each policy of primary mortgage guaranty
insurance or any replacement policy
therefor with respect to any Mortgage
Loan.
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Prime Rate: The
prime commercial lending rate of The Bank of New York, as
publicly announced to be in effect from
time to time. The Prime Rate shall be
adjusted automatically, without notice, on
the effective date of any change in
such prime commercial lending rate. The
Prime Rate is not necessarily The Bank
of New York's lowest rate of interest.
Principal
Prepayment: Any payment of principal by a Mortgagor on a
Mortgage Loan that is received in advance
of its scheduled Due Date and is not
accompanied by an amount representing
scheduled interest due on any date or
dates in any month or months subsequent to
the month of prepayment. Partial
Principal Prepayments shall be applied by
the Master Servicer in accordance
with the terms of the related Mortgage
Note.
Principal
Prepayment in Full: Any Principal Prepayment made by a
Mortgagor of the entire principal balance
of a Mortgage Loan.
Principal
Relocation Payment: A payment from any Collateral Allocation
Group to a Subsidiary REMIC Regular
Interest other than a Regular Interest
corresponding to that Collateral Allocation
Group as provided in the
Preliminary Statement. Principal Relocation
Payments from a Collateral
Allocation Group shall be made of the
amounts in respect of principal from the
Mortgage Loans of the Collateral Allocation
Group and shall include a
proportionate allocation of the Realized
Losses from the Mortgage Loans of the
Collateral Allocation Group.
Priority Amount:
Not applicable.
Priority
Percentage: Not applicable.
Private
Certificate: As specified in the Preliminary Statement.
Pro Rata Share:
As to any Distribution Date, the Subordinated Principal
Distribution Amount and any Class of
Subordinated Certificates, the portion of
the Subordinated Principal Distribution
Amount allocable to such Class, equal
to the product of the Subordinated
Principal Distribution Amount on such
Distribution Date and a fraction, the
numerator of which is the related Class
Certificate Balance thereof and the
denominator of which is the aggregate of
the Class Certificate Balances of the
Subordinated Certificates.
Proprietary
Lease: With respect to any Cooperative Unit, a lease or
occupancy agreement between a Cooperative
Corporation and a holder of related
Coop Shares.
Prospectus: The
Prospectus dated July 25, 2005 generally relating to
mortgage pass-through certificates to be
sold by the Depositor.
Prospectus
Supplement: The Prospectus Supplement dated September 28, 2005
relating to the Offered Certificates.
PUD: Planned
Unit Development.
Purchase Price:
With respect to any Mortgage Loan required to be
purchased by a Seller pursuant to Section
2.02 or 2.03 hereof or purchased at
the option of the Master Servicer pursuant
to Section 3.11, an amount equal to
the sum of (i) 100% of the unpaid principal
balance
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of the Mortgage Loan on the date of such
purchase, (ii) accrued interest
thereon at the applicable Mortgage Rate (or
at the applicable Adjusted
Mortgage Rate if (x) the purchaser is the
Master Servicer or (y) if the
purchaser is Countrywide and Countrywide is
an affiliate of the Master
Servicer) from the date through which
interest was last paid by the Mortgagor
to the Due Date in the month in which the
Purchase Price is to be distributed
to Certificateholders and (iii) costs and
damages incurred by the Trust Fund
in connection with a repurchase pursuant to
Section 2.03 hereof that arises
out of a violation of any predatory or
abusive lending law with respect to the
related Mortgage Loan.
Qualified
Bidder: Any nationally-recognized broker dealer other than a
Seller, the Master Servicer and any of
their respective Affiliates.
Qualified
Insurer: A mortgage guaranty insurance company duly qualified
as such under the laws of the state of its
principal place of business and
each state having jurisdiction over such
insurer in connection with the
insurance policy issued by such insurer,
duly authorized and licensed in such
states to transact a mortgage guaranty
insurance business in such states and
to write the insurance provided by the
insurance policy issued by it, approved
as a FNMA-approved mortgage insurer and
having a claims paying ability rating
of at least "AA" or equivalent rating by a
nationally recognized statistical
rating organization. Any replacement
insurer with respect to a Mortgage Loan
must have at least as high a claims paying
ability rating as the insurer it
replaces had on the Closing Date.
Rating Agency:
Each of the Rating Agencies specified in the Preliminary
Statement. If any such organization or a
successor is no longer in existence,
"Rating Agency" shall be such nationally
recognized statistical rating
organization, or other comparable Person,
as is designated by the Depositor,
notice of which designation shall be given
to the Trustee. References herein
to a given rating category of a Rating
Agency shall mean such rating category
without giving effect to any modifiers.
Realized Loss:
With respect to each Liquidated Mortgage Loan, an amount
(not less than zero or more than the Stated
Principal Balance of the Mortgage
Loan) as of the date of such liquidation,
equal to (i) the Stated Principal
Balance of the Liquidated Mortgage Loan as
of the date of such liquidation,
plus (ii) interest at the Adjusted Net
Mortgage Rate from the Due Date as to
which interest was last paid or advanced
(and not reimbursed) to
Certificateholders up to the Due Date in
the month in which Liquidation
Proceeds are required to be distributed on
the Stated Principal Balance of
such Liquidated Mortgage Loan from time to
time, minus (iii) the Liquidation
Proceeds, if any, received during the month
in which such liquidation
occurred, to the extent applied as
recoveries of interest at the Adjusted Net
Mortgage Rate and to principal of the
Liquidated Mortgage Loan. With respect
to each Mortgage Loan which has become the
subject of a Deficient Valuation,
if the principal amount due under the
related Mortgage Note has been reduced,
the difference between the principal
balance of the Mortgage Loan outstanding
immediately prior to such Deficient
Valuation and the principal balance of the
Mortgage Loan as reduced by the Deficient
Valuation. With respect to each
Mortgage Loan which has become the subject
of a Debt Service Reduction and any
Distribution Date, the amount, if any, by
which the principal portion of the
related Scheduled Payment has been
reduced.
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To the extent
the Master 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 by such
Subsequent Recoveries.
Recognition
Agreement: With respect to any Cooperative Loan, an agreement
between the Cooperative Corporation and the
originator of such Mortgage Loan
which establishes the rights of such
originator in the Cooperative Property.
Record Date:
With respect to any Distribution Date, the close of business
on the last Business Day of the month
preceding the month in which such
Distribution Date occurs.
Reference Bank:
As defined in Section 4.08(b).
Refinancing
Mortgage Loan: Any Mortgage Loan originated in connection
with the refinancing of an existing
mortgage loan.
Regular
Certificates: As specified in the Preliminary Statement.
Relief Act: The
Servicemembers Civil Relief Act.
Relief Act
Reductions: With respect to any Distribution Date and any
Mortgage Loan as to which there has been a
reduction in the amount of interest
collectible thereon for the most recently
ended calendar month as a result of
the application of the Relief Act or
similar state or local laws, the amount,
if any, by which (i) interest collectible
on such Mortgage Loan for the most
recently ended calendar month is less than
(ii) interest accrued thereon for
such month pursuant to the Mortgage
Note.
REMIC: A "real
estate mortgage investment conduit" within the meaning of
section 860D of the Code.
REMIC Change of
Law: Any proposed, temporary or final regulation, revenue
ruling, revenue procedure or other official
announcement or interpretation
relating to REMICs and the REMIC Provisions
issued after the Closing Date.
REMIC
Provisions: Provisions of the federal income tax law relating
to
real estate mortgage investment conduits,
which appear at sections 860A
through 860G of Subchapter M of Chapter 1
of the Code, and related provisions,
and regulations promulgated thereunder, as
the foregoing may be in effect from
time to time as well as provisions of
applicable state laws.
REO Property: A
Mortgaged Property acquired by the Trust Fund through
foreclosure or deed-in-lieu of foreclosure
in connection with a defaulted
Mortgage Loan.
Request for
Release: The Request for Release submitted by the Master
Servicer to the Trustee, substantially in
the form of Exhibits M and N, as
appropriate.
Required Coupon:
With respect to Collateral Allocation Group 1, 5.00% per
annum, and with respect to Collateral
Allocation Group 2, the lesser of 6.00%
per annum and the Available Funds Rate.
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Required
Insurance Policy: With respect to any Mortgage Loan, any
insurance policy that is required to be
maintained from time to time under
this Agreement.
Residual
Certificates: As specified in the Preliminary Statement.
Responsible
Officer: When used with respect to the Trustee, any Vice
President, any Assistant Vice President,
the Secretary, any Assistant
Secretary, any Trust Officer or any other
officer of the Trustee customarily
performing functions similar to those
performed by any of the above designated
officers and also to whom, with respect to
a particular matter, such matter is
referred because of such officer's
knowledge of and familiarity with the
particular subject.
Restricted
Classes: As defined in Section 4.02(f).
S&P:
Standard & Poor's Ratings Services, a division of The
McGraw-Hill
Companies, Inc. If S&P is designated as
a Rating Agency in the Preliminary
Statement, for purposes of Section 10.05(b)
the address for notices to S&P
shall be Standard & Poor's, 55 Water
Street, New York, New York 10041,
Attention: Mortgage Surveillance
Monitoring, or such other address as S&P may
hereafter furnish to the Depositor and the
Master Servicer.
Scheduled
Balances: With respect to any Planned Principal Classes or
Components and Targeted Principal Classes
or Components set forth in the
Preliminary Statement and any Distribution
Date, the amount set forth on
Schedule V hereto for those Classes or
Components and Distribution Date.
Scheduled
Classes: As specified in the Preliminary Statement.
Scheduled
Payment: The scheduled monthly payment on a Mortgage Loan due
on any Due Date allocable to principal
and/or interest on such Mortgage Loan
which, unless otherwise specified herein,
shall give effect to any related
Debt Service Reduction and any Deficient
Valuation that affects the amount of
the monthly payment due on such Mortgage
Loan.
Scheduled
Principal Distribution Amount: Not applicable.
Securities Act:
The Securities Act of 1933, as amended.
Seller:
Countrywide, Park Granada, Park Monaco or Park Sienna, as
applicable.
Senior
Certificate Group: As specified in the Preliminary Statement.
Senior
Certificates: As specified in the Preliminary Statement.
Senior Credit
Support Depletion Date: The date on which the Class
Certificate Balance of each Class of
Subordinated Certificates has been
reduced to zero.
Senior
Percentage: For any Distribution Date and the Senior
Certificates
related to Collateral Allocation Group 1,
the percentage equivalent of a
fraction, not in excess of 100%, the
numerator of which is the Class
Certificate Balance of such Class of Senior
Certificates (other than the Class
PO Certificates) immediately prior to such
Distribution Date plus the
Aggregate
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Net Cross Payment, if any, and the
denominator of which is the aggregate of
the Applicable Fraction for Collateral
Allocation Group 1 of the Stated
Principal Balance of each Mortgage Loan as
of the Due Date in the month
preceding the month of that Distribution
Date (after giving effect to
Principal Prepayments received in the
Prepayment Period related to that
preceding Due Date). For any Distribution
Date and the Senior Certificates
related to Collateral Allocation Group 2,
the percentage equivalent of a
fraction, not in excess of 100%, the
numerator of which is the aggregate of
the Class Certificate Balances of such
Class of Senior Certificates
immediately prior to such Distribution Date
minus the Aggregate Net Cross
Payment, if any, and the denominator of
which is the aggregate of the
Applicable Fraction for Collateral
Allocation Group 2 of the Stated Principal
Balance of each Mortgage Loan as of the Due
Date in the month preceding the
month of that Distribution Date (after
giving effect to Principal Prepayments
received in the Prepayment Period related
to that preceding Due Date).
Senior
Prepayment Percentage: For any Distribution Date during the
five
years beginning on the first Distribution
Date, 100%. The Senior Prepayment
Percentage for any Distribution Date
occurring on or after the fifth
anniversary of the first Distribution Date
will, except as provided herein, be
as follows: for any Distribution Date in
the first year thereafter, the Senior
Percentage plus 70% of the Subordinated
Percentage for such Distribution Date;
for any Distribution Date in the second
year thereafter, the Senior Percentage
plus 60% of the Subordinated Percentage for
such Distribution Date; for any
Distribution Date in the third year
thereafter, the Senior Percentage plus 40%
of the Subordinated Percentage for such
Distribution Date; for any
Distribution Date in the fourth year
thereafter, the Senior Percentage plus
20% of the Subordinated Percentage for such
Distribution Date; and for any
Distribution Date thereafter, the Senior
Percentage for such Distribution Date
(unless on any Distribution Date the Senior
Percentage exceeds the initial
Senior Percentage, in which case the Senior
Prepayment Percentage for such
Distribution Date will once again equal
100%). Notwithstanding the foregoing,
no decrease in the Senior Prepayment
Percentage will occur unless both of the
Senior Step Down Conditions are
satisfied.
Senior Principal
Distribution Amount: As to any Distribution Date and
Collateral Allocation Group, the sum of (i)
the related Senior Percentage of
the applicable Non-PO Percentage of the
Applicable Fraction of all amounts
described in subclauses (a) through (d) of
clause (i) of the definition of
"Non-PO Formula Principal Amount" with
respect to that Collateral Allocation
Group for such Distribution Date, (ii) with
respect to any Mortgage Loan
related to Collateral Allocation Group that
became a Liquidated Mortgage Loan
during the calendar month preceding the
month of such Distribution Date, the
portion (by Applicable Fraction) allocable
to that Collateral Allocation Group
of the lesser of (x) the related Senior
Percentage of the applicable Non-PO
Percentage of the Stated Principal Balance
of such Mortgage Loan and (y) the
related Senior Prepayment Percentage of the
applicable Non-PO Percentage of
the amount of the Liquidation Proceeds
allocable to principal received with
respect to such Mortgage Loan, and (iii)
the related Senior Prepayment
Percentage of the applicable Non-PO
Percentage of the Applicable Fractions of
the amounts described in subclause (f) of
clause (i) of the definition of
"Non-PO Formula Principal Amount" with
respect to that Collateral Allocation
Group for such Distribution Date plus (y)
the Senior Prepayment Percentage for
the related Senior Certificate Group of any
Subsequent Recoveries on the
Mortgage Loans allocable (based on the
Applicable Fraction) to that Collateral
Allocation Group
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described in clause (ii) of the definition
of "Non-PO Formula Principal
Amount" for such Distribution Date.
Senior Step Down
Conditions: As of the first Distribution Date as to
which any decrease in the Senior Prepayment
Percentage applies, (i) the
outstanding principal balance of all
Mortgage Loans delinquent 60 days or more
(including Mortgage Loans in foreclosure,
REO Property and Mortgage Loans the
mortgagors of which are in bankruptcy)
(averaged over the preceding six month
period), as a percentage of the aggregate
Class Certificate Balance of the
Subordinated Certificates on such
Distribution Date, does not equal or exceed
50% and (ii) cumulative Realized Losses
with respect to the Mortgage Loans do
not exceed (a) commencing with the
Distribution Date on the fifth anniversary
of the first Distribution Date, 30% of the
Original Subordinate Principal
Balance, (b) commencing with the
Distribution Date on the sixth anniversary of
the first Distribution Date, 35% of the
Original Subordinate Principal
Balance, (c) commencing with the
Distribution Date on the seventh anniversary
of the first Distribution Date, 40% of the
Original Subordinate Principal
Balance, (d) commencing with the
Distribution Date on the eighth anniversary
of the first Distribution Date, 45% of the
Original Subordinate Principal
Balance and (e) commencing with the
Distribution Date on the ninth anniversary
of the first Distribution Date, 50% of the
Original Subordinate Principal
Balance.
Servicing
Advances: All customary, reasonable and necessary "out of
pocket" costs and expenses incurred in the
performance by the Master Servicer
of its servicing obligations, including,
but not limited to, the cost of (i)
the preservation, restoration and
protection of a Mortgaged Property, (ii) any
expenses reimbursable to the Master
Servicer pursuant to Section 3.11 and any
enforcement or judicial proceedings,
including foreclosures, (iii) the
management and liquidation of any REO
Property and (iv) compliance with the
obligations under Section 3.09.
Servicing
Officer: Any officer of the Master Servicer involved in, or
responsible for, the administration and
servicing of the Mortgage Loans whose
name and facsimile signature appear on a
list of servicing officers furnished
to the Trustee by the Master Servicer on
the Closing Date pursuant to this
Agreement, as such list may from time to
time be amended.
Shift
Percentage: Not applicable.
Startup Day: The
Closing Date.
Stated Principal
Balance: As to any Mortgage Loan and Due Date, the
unpaid principal balance of such Mortgage
Loan as of such Due Date, as
specified in its amortization schedule at
that time relating thereto (before
any adjustment to the amortization schedule
by reason of any moratorium or
similar waiver or grace period) after
giving effect to the sum of: (i) any
previous partial Principal Prepayments and
the payment of principal due on
such Due Date, irrespective of any
delinquency in payment by the related
Mortgagor and (ii) Liquidation Proceeds
allocable to principal (other than
with respect to any Liquidated Mortgage
Loan) received in the prior calendar
month and Principal Prepayments received
through the last day of the related
Prepayment Period, in each case, with
respect to that Mortgage Loan.
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<PAGE>
Streamlined
Documentation Mortgage Loan: Any Mortgage Loan originated
pursuant to Countrywide's Streamlined Loan
Documentation Program then in
effect. For the purposes of this Agreement,
a Mortgagor is eligible for a
mortgage pursuant to Countrywide's
Streamlined Loan Documentation Program if
that Mortgagor is refinancing an existing
mortgage loan that was originated or
acquired by Countrywide where, among other
things, the mortgage loan has not
been more than 30 days delinquent in
payment during the previous twelve-month
period.
Subordinate
Pass-Through Rate: As described in the Preliminary Statement.
Subordinated
Certificates: As specified in the Preliminary Statement.
Subordinated
Portion: For any Distribution Date and for each Collateral
Allocation Group, the excess of the
Collateral Allocation Group Principal
Balance of such Collateral Allocation Group
for such Distribution Date over
the aggregate Class Certificate Balance of
the Senior Certificates in the
related Senior Certificate Group
immediately prior to such Distribution Date.
Subordinated Percentage: As
to any Distribution Date, 100% minus the
Senior Percentage for such Distribution
Date.
Subordinated
Prepayment Percentage: As to any Distribution Date, 100%
minus the Senior Prepayment Percentage for
such Distribution Date.
Subordinated
Principal Distribution Amount: With respect to any
Distribution Date and Collateral Allocation
Group, an amount equal to the
excess of (A) the sum, not less than zero,
of (i) the related Subordinated
Percentage of the applicable Non-PO
Percentage of the Applicable Fractions of
all amounts described in subclauses (a)
through (d) of clause (i) of the
definition of "Non-PO Formula Principal
Amount" for such Collateral Allocation
Group and Distribution Date, (ii) with
respect to each Mortgage Loan related
to that Collateral Allocation Group that
became a Liquidated Mortgage Loan
during the calendar month preceding the
month of such Distribution Date, the
portion (by Applicable Fraction) allocable
to that Collateral Allocation Group
of the applicable Non-PO Percentage of the
amount of the Liquidation Proceeds
allocated to principal received with
respect thereto remaining after
application thereof pursuant to clause (ii)
of the definition of Senior
Principal Distribution Amount, up to the
related Subordinated Percentage for
such Collateral Allocation Group of the
applicable Non-PO Percentage of the
Stated Principal Balance of such Mortgage
Loan, (iii) the related Subordinated
Prepayment Percentage for that Collateral
Allocation Group of the applicable
Non-PO Percentage of the Applicable
Fractions of all amounts described in
subclause (f) of clause (i) of the
definition of "Non-PO Formula Principal
Amount" for such Collateral Allocation
Group and Distribution Date, and (iv)
the related Subordinated Prepayment
Percentage for that Collateral Allocation
Group of any Subsequent Recoveries
allocable (based upon the Applicable
Fraction) to that Collateral Allocation
Group described in clause (ii) of the
definition of "Non-PO Formula Principal
Amount" for such Collateral Allocation
Group and Distribution Date, over (B) the
amount of any payments in respect of
Class PO Deferred Amounts for the Class PO
Certificates, if applicable, on the
related Distribution Date.
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<PAGE>
Subsequent
Recoveries: As to any Distribution Date, with respect to a
Liquidated Mortgage Loan that resulted in a
Realized Loss in a prior calendar
month, unexpected amounts received by the
Master Servicer (net of any related
expenses permitted to be reimbursed
pursuant to Section 3.08) specifically
related to such Liquidated Mortgage
Loan.
Subservicer: Any
person to whom the Master Servicer has contracted for
the servicing of all or a portion of the
Mortgage Loans pursuant to Section
3.02 hereof.
Substitute
Mortgage Loan: A Mortgage Loan substituted by the applicable
Seller for a Deleted Mortgage Loan which
must, on the date of such
substitution, as confirmed in a Request for
Release, substantially in the form
of Exhibit M, (i) have a Stated Principal
Balance, after deduction of the
principal portion of the Scheduled Payment
due in the month of substitution,
not in excess of, and not more than 10%
less than the Stated Principal Balance
of the Deleted Mortgage Loan; (ii) be
accruing interest at a rate no lower
than and not more than 1% per annum higher
than, that of the Deleted Mortgage
Loan; (iii) have a Loan-to-Value Ratio no
higher than that of the Deleted
Mortgage Loan; (iv) have a remaining term
to maturity no greater than (and not
more than one year less than that of) the
Deleted Mortgage Loan; (v) not be a
Cooperative Loan unless the Deleted
Mortgage Loan was a Cooperative Loan and
(vi) comply with each representation and
warranty set forth in Section 2.03
hereof.
Substitution
Adjustment Amount: The meaning ascribed to such term
pursuant to Section 2.03.
Successful
Auction: An auction held pursuant to Section 9.04 hereof at
which at least three Qualified Bidders
submitted bids and at least the Minimum
Bid Price was bid as the purchase price for
the Mortgage Loans and any related
REO Properties by a Qualified Bidder.
Targeted
Balance: With respect to any group of Targeted Principal
Classes
or Components in the aggregate and any
Distribution Date appearing in Schedule
V hereto, the Aggregate Targeted Balance
for such group and Distribution Date.
With respect to any other Targeted
Principal Class or Component and any
Distribution Date appearing in Schedule V
hereto, the applicable amount
appearing opposite such Distribution Date
for such Class or Component.
Targeted
Principal Classes: As specified in the Preliminary Statement.
Tax Matters
Person: The person designated as "tax matters person" in the
manner provided under Treasury regulation
ss. 1.860F-4(d) and Treasury
regulation ss. 301.6231(a)(7)-1. Initially,
the Tax Matters Person shall be
the Trustee.
Tax Matters
Person Certificate: The Class A-R Certificate with a
Denomination of $0.01.
Transfer: Any
direct or indirect transfer or sale of any Ownership
Interest in a Residual Certificate.
Transfer
Payment: For any Distribution Date, an amount equal to the
product of (i) a fraction, the numerator of
which is the excess, if any, of
the amount of principal distributed on
all
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prior Distribution Dates to the Class 1-A-1
Certificates from payments
received in respect of Collateral
Allocation Group 2 over the amount of
principal distributed on all prior
Distribution Dates to the Group 2 Senior
Certificates from payments received in
respect of Collateral Allocation Group
1, and the denominator of which is the
aggregate Stated Principal Balance of
the Applicable Fractions of the Mortgage
Loans in Collateral Group 1 as of the
Due Date in the preceding calendar month
(after giving effect to Principal
Prepayments received in the Prepayment
Period related to that preceding Due
Date), and (ii) the amount of interest
collected on the Applicable Fractions
of the Mortgage Loans in Collateral
Allocation Group 1 due on the Due Date in
the month in which the Distribution Date
occurs.
Trust Fund: The
corpus of the trust created hereunder consisting of (i)
the Mortgage Loans and all interest and
principal received on or with respect
thereto after the Cut-off Date to the
extent not applied in computing the
Cut-off Date Principal Balance thereof;
(ii) the Certificate Account, the
Distribution Account, the Corridor Contract
Reserve Fund, the Corridor
Contract and all amounts deposited therein
pursuant to the applicable
provisions of this Agreement; (iii)
property that secured a Mortgage Loan and
has been acquired by foreclosure,
deed-in-lieu of foreclosure or otherwise;
(iv) the Corridor Contract and (v) all
proceeds of the conversion, voluntary
or involuntary, of any of the
foregoing.
Trustee: The
Bank of New York and its successors and, if a successor
trustee is appointed hereunder, such
successor.
Trustee Advance
Rate: With respect to any Advance made by the Trustee
pursuant to Section 4.01(b), a per annum
rate of interest determined as of the
date of such Advance equal to the Prime
Rate in effect on such date plus
5.00%.
Undercollateralized Group: Not applicable.
Underwriter's
Exemption: Prohibited Transaction Exemption 2002-41, 67
Fed. Reg. 54487 (2002), as amended (or any
successor thereto), or any
substantially similar administrative
exemption granted by the U.S. Department
of Labor.
Underwriters: As
specified in the Preliminary Statement.
Unscheduled
Principal Distribution Amount: Not applicable.
Voting Rights:
The portion of the voting rights of all of the
Certificates which is allocated to any
Certificate. As of any date of
determination, (a) 1% of all Voting Rights
shall be allocated to each Class of
Notional Amount Certificates, if any (such
Voting Rights to be allocated among
the holders of Certificates of each such
Class in accordance with their
respective Percentage Interests), and (b)
the remaining Voting Rights (or 100%
of the Voting Rights if there is no Class
of Notional Amount Certificates)
shall be allocated among Holders of the
remaining Classes of Certificates in
proportion to the Certificate Balances of
their respective Certificates on
such date.
Winning Bidder:
With respect to a Successful Auction, the Qualified
Bidder offering to pay the highest price
(but in no event less than the
Minimum Bid Price) for the assets of the
Trust Fund.
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Yield Supplement
Amount: As to the Class 2-A-6 Certificates and any
Distribution Date on or prior to the April
2014 Distribution Date for which
LIBOR (as determined by the Corridor
Contract Counterparty) exceeds 5.50%, an
amount equal to interest for the related
Interest Accrual Period on the Class
Certificate Balance of the Class 2-A-6
Certificates immediately prior to such
Distribution Date at a rate equal to the
excess of (i) the lesser of LIBOR (as
determined by the applicable Corridor
Contract Counterparty) and 9.00% over
(ii) 5.50%.
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ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
SECTION 2.01.
Conveyance of Mortgage Loans
(a) Each Seller,
concurrently with the execution and delivery hereof,
hereby sells, transfers, assigns, sets over
and otherwise conveys to the
Depositor, without recourse, all its
respective right, title and interest in
and to the related Mortgage Loans,
including all interest and principal
received or receivable by such Seller on or
with respect to the Mortgage Loans
after the Cut-off Date and all interest and
principal payments on the related
Mortgage Loans received prior to the
Cut-off Date in respect of installments
of interest and principal due thereafter,
but not including payments of
principal and interest due and payable on
such Mortgage Loans on or before the
Cut-off Date. On or prior to the Closing
Date, Countrywide shall deliver to
the Depositor or, at the Depositor's
direction, to the Trustee or other
designee of the Depositor, the Mortgage
File for each Mortgage Loan listed in
the Mortgage Loan Schedule (except that, in
the case of the Delay Delivery
Mortgage Loans (which may include
Countrywide Mortgage Loans, Park Granada
Mortgage Loans, Park Monaco Mortgage Loans
and Park Sienna Mortgage Loans),
such delivery may take place within thirty
(30) days following the Closing
Date). Such delivery of the Mortgage Files
shall be made against payment by
the Depositor of the purchase price,
previously agreed to by the Sellers and
Depositor, for the Mortgage Loans. With
respect to any Mortgage Loan that does
not have a first payment date on or before
the Due Date in the month of the
first Distribution Date, Countrywide shall
deposit into the Distribution
Account on or before the Distribution
Account Deposit Date relating to the
first applicable Distribution Date, an
amount equal to one month's interest at
the related Adjusted Mortgage Rate on the
Cut-off Date Principal Balance of
such Mortgage Loan. In addition, on the
Closing Date, the Depositor shall
cause $100.00 to be deposited into the
Class C Distribution Account.
(b) Immediately
upon the conveyance of the Mortgage Loans referred to in
clause (a), the Depositor sells, transfers,
assigns, sets over and otherwise
conveys to the Trustee for the benefit of
the Certificateholders, without
recourse, all the right, title and interest
of the Depositor in and to the
Trust Fund together with the Depositor's
right to require each Seller to cure
any breach of a representation or warranty
made herein by such Seller or to
repurchase or substitute for any affected
Mortgage Loan in accordance
herewith.
(c) In
connection with the transfer and assignment set forth in clause
(b) above, the Depositor has delivered or
caused to be delivered to the
Trustee (or, in the case of the Delay
Delivery Mortgage Loans, will deliver or
cause to be delivered to the Trustee within
thirty (30) days following the
Closing Date) for the benefit of the
Certificateholders the following
documents or instruments with respect to
each Mortgage Loan so assigned:
(i) (A) the original Mortgage Note endorsed by manual or
facsimile
signature in blank in the following form: "Pay to the order of
____________ without recourse," with all intervening
endorsements
showing a complete chain of endorsement from the originator to
the
Person endorsing the Mortgage Note (each such endorsement being
sufficient to transfer all right, title and interest of the party
so
endorsing, as noteholder or assignee thereof, in and to that
Mortgage
Note); or
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(B) with respect to any Lost Mortgage Note, a lost note
affidavit
from
Countrywide stating that the original Mortgage Note was lost or
destroyed, together with a copy of such Mortgage Note;
(ii) except as provided below and for each Mortgage Loan that is
not
a
MERS Mortgage Loan, the original recorded Mortgage or a copy of
such
Mortgage certified by Countrywide as being a true and complete copy
of
the
Mortgage (or, in the case of a Mortgage for which the related
Mortgaged Property is located in the Commonwealth of Puerto Rico,
a
true
copy of the Mortgage certified as such by the applicable
notary)
and
in the case of each MERS Mortgage Loan, the original Mortgage,
noting the presence of the MIN of the Mortgage Loans and either
language indicating that the Mortgage Loan is a MOM Loan if the
Mortgage Loan is a MOM Loan or if the Mortgage Loan was not a MOM
Loan
at
origination, the original Mortgage and the assignment thereof
to
MERS, with evidence of recording indicated thereon, or a copy of
the
Mortgage certified by the public recording office in which such
Mortgage has been recorded;
(iii) in the case of each Mortgage Loan that is not a MERS
Mortgage
Loan, a duly executed assignment of the Mortgage (which may be
included
in a
blanket assignment or assignments), together with, except as
provided below, all interim recorded assignments of such mortgage
(each
such
assignment, when duly and validly completed, to be in
recordable
form
and sufficient to effect the assignment of and transfer to the
assignee thereof, under the Mortgage to which the assignment
relates);
provided that, if the related Mortgage has not been returned from
the
applicable public recording office, such assignment of the Mortgage
may
exclude the information to be provided by the recording office;
provided, further, that such assignment of Mortgage need not be
delivered in the case of a Mortgage for which the related
Mortgaged
Property is located in the Commonwealth of Puerto Rico;
(iv) the original or copies of each assumption, modification,
written assurance or substitution agreement, if any;
(v) except as provided below, the original or duplicate
original
lender's title policy or a printout of the electronic equivalent
and
all
riders thereto; and
(vi) in the case of a Cooperative Loan, the originals of the
following documents or instruments:
(A) The Coop Shares, together with a stock power in blank;
(B) The executed Security Agreement;
(C) The executed Proprietary Lease;
(D) The executed Recognition Agreement;
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(E) The executed UCC-1 financing statement with evidence of
recording thereon which have been filed in all places required
to
perfect the Seller's interest in the Coop Shares and the
Proprietary
Lease; and
(F) The executed UCC-3 financing statements or other
appropriate
UCC
financing statements required by state law, evidencing a complete
and
unbroken line from the mortgagee to the Trustee with evidence
of
recording thereon (or in a form suitable for recordation).
In addition, in
connection with the assignment of any MERS Mortgage Loan,
each Seller agrees that it will cause, at
the Trustee's expense, the MERS(R)
System to indicate that the Mortgage Loans
sold by such Seller to the
Depositor have been assigned by that Seller
to the Trustee in accordance with
this Agreement for the benefit of the
Certificateholders by including (or
deleting, in the case of Mortgage Loans
which are repurchased in accordance
with this Agreement) in such computer files
the information required by the
MERS(R) System to identify the series of
the Certificates issued in connection
with such Mortgage Loans. Each Seller
further agrees that it will not, and
will not permit the Master Servicer to, and
the Master Servicer agrees that it
will not, alter the information referenced
in this paragraph with respect to
any Mortgage Loan sold by such Seller to
the Depositor during the term of this
Agreement unless and until such Mortgage
Loan is repurchased in accordance
with the terms of this Agreement.
In the event
that in connection with any Mortgage Loan that is not a MERS
Mortgage Loan the Depositor cannot deliver
(a) the original recorded Mortgage,
(b) all interim recorded assignments or (c)
the lender's title policy
(together with all riders thereto)
satisfying the requirements of clause (ii),
(iii) or (v) above, respectively,
concurrently with the execution and delivery
hereof because such document or documents
have not been returned from the
applicable public recording office in the
case of clause (ii) or (iii) above,
or because the title policy has not been
delivered to either the Master
Servicer or the Depositor by the applicable
title insurer in the case of
clause (v) above, the Depositor shall
promptly deliver to the Trustee, in the
case of clause (ii) or (iii) above, such
original Mortgage or such interim
assignment, as the case may be, with
evidence of recording indicated thereon
upon receipt thereof from the public
recording office, or a copy thereof,
certified, if appropriate, by the relevant
recording office, but in no event
shall any such delivery of the original
Mortgage and each such interim
assignment or a copy thereof, certified, if
appropriate, by the relevant
recording office, be made later than one
year following the Closing Date, or,
in the case of clause (v) above, no later
than 120 days following the Closing
Date; provided, however, in the event the
Depositor is unable to deliver by
such date each Mortgage and each such
interim assignment by reason of the fact
that any such documents have not been
returned by the appropriate recording
office, or, in the case of each such
interim assignment, because the related
Mortgage has not been returned by the
appropriate recording office, the
Depositor shall deliver such documents to
the Trustee as promptly as possible
upon receipt thereof and, in any event,
within 720 days following the Closing
Date. The Depositor shall forward or cause
to be forwarded to the Trustee (a)
from time to time additional original
documents evidencing an assumption or
modification of a Mortgage Loan and (b) any
other documents required to be
delivered by the Depositor or the Master
Servicer to the Trustee. In the event
that the original Mortgage is not delivered
and in connection with the payment
in full of the related Mortgage Loan and
the public recording office requires
the presentation of a "lost instruments
affidavit and indemnity" or any
equivalent document, because only a copy of
the
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Mortgage can be delivered with the
instrument of satisfaction or reconveyance,
the Master Servicer shall execute and
deliver or cause to be executed and
delivered such a document to the public
recording office. In the case where a
public recording office retains the
original recorded Mortgage or in the case
where a Mortgage is lost after recordation
in a public recording office,
Countrywide shall deliver to the Trustee a
copy of such Mortgage certified by
such public recording office to be a true
and complete copy of the original
recorded Mortgage.
As promptly as
practicable subsequent to such transfer and assignment,
and in any event, within thirty (30) days
thereafter, the Trustee shall (i) as
the assignee thereof, affix the following
language to each assignment of
Mortgage: "CWALT Series 2005-53T2, The Bank
of New York, as trustee", (ii)
cause such assignment to be in proper form
for recording in the appropriate
public office for real property records and
(iii) cause to be delivered for
recording in the appropriate public office
for real property records the
assignments of the Mortgages to the
Trustee, except that, with respect to any
assignments of Mortgage as to which the
Trustee has not received the
information required to prepare such
assignment in recordable form, the
Trustee's obligation to do so and to
deliver the same for such recording shall
be as soon as practicable after receipt of
such information and in any event
within thirty (30) days after receipt
thereof and that the Trustee need not
cause to be recorded any assignment which
relates to a Mortgage Loan (a) the
Mortgaged Property and Mortgage File
relating to which are located in
California or (b) in any other jurisdiction
(including Puerto Rico) under the
laws of which in the opinion of counsel the
recordation of such assignment is
not necessary to protect the Trustee's and
the Certificateholders' interest in
the related Mortgage Loan.
In the case of
Mortgage Loans that have been prepaid in full as of the
Closing Date, the Depositor, in lieu of
delivering the above documents to the
Trustee, will deposit in the Certificate
Account the portion of such payment
that is required to be deposited in the
Certificate Account pursuant to
Section 3.05 hereof.
Notwithstanding
anything to the contrary in this Agreement, within thirty
(30) days after the Closing Date with
respect to the Mortgage Loans,
Countrywide (on its own behalf and on
behalf of Park Granada, Park Monaco and
Park Sienna) shall either (i) deliver to
the Depositor, or at the Depositor's
direction, to the Trustee or other designee
of the Depositor the Mortgage File
as required pursuant to this Section 2.01
for each Delay Delivery Mortgage
Loan or (ii) either (A) substitute a
Substitute Mortgage Loan for the Delay
Delivery Mortgage Loan or (B) repurchase
the Delay Delivery Mortgage Loan,
which substitution or repurchase shall be
accomplished in the manner and
subject to the conditions set forth in
Section 2.03 (treating each Delay
Delivery Mortgage Loan as a Deleted
Mortgage Loan for purposes of such Section
2.03); provided, however, that if
Countrywide fails to deliver a Mortgage File
for any Delay Delivery Mortgage Loan within
the thirty (30) day period
provided in the prior sentence, Countrywide
(on its own behalf and on behalf
of Park Granada, Park Monaco and Park
Sienna) shall use its best reasonable
efforts to effect a substitution, rather
than a repurchase of, such Deleted
Mortgage Loan and provided further that the
cure period provided for in
Section 2.02 or in Section 2.03 shall not
apply to the initial delivery of the
Mortgage File for such Delay Delivery
Mortgage Loan, but rather Countrywide
(on its own behalf and on behalf of Park
Granada, Park Monaco and Park Sienna)
shall have five (5) Business Days to cure
such failure to deliver. At the end
of such thirty (30) day period the Trustee
shall send a Delay
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Delivery Certification for the Delay
Delivery Mortgage Loans delivered during
such thirty (30) day period in accordance
with the provisions of Section 2.02.
(d) Neither the
Depositor nor the Trust will acquire or hold any Mortgage
Loan that would violate the representations
made by Countrywide set forth in
clause (48) of Schedule III-A hereto.
SECTION 2.02.
Acceptance by Trustee of the Mortgage Loans.
(a) The Trustee
acknowledges receipt of the documents identified in the
Initial Certification in the form annexed
hereto as Exhibit F and declares
that it holds and will hold such documents
and the other documents delivered
to it constituting the Mortgage Files, and
that it holds or will hold such
other assets as are included in the Trust
Fund, in trust for the exclusive use
and benefit of all present and future
Certificateholders. The Trustee
acknowledges that it will maintain
possession of the Mortgage Notes in the
State of California, unless otherwise
permitted by the Rating Agencies.
The Trustee
agrees to execute and deliver on the Closing Date to the
Depositor, the Master Servicer and
Countrywide (on its own behalf and on
behalf of Park Granada, Park Monaco and
Park Sienna) an Initial Certification
in the form annexed hereto as Exhibit F-1.
Based on its review and
examination, and only as to the documents
identified in such Initial
Certification, the Trustee acknowledges
that such documents appear regular on
their face and relate to such Mortgage
Loan. The Trustee shall be under no
duty or obligation to inspect, review or
examine said documents, instruments,
certificates or other papers to determine
that the same are genuine,
enforceable or appropriate for the
represented purpose or that they have
actually been recorded in the real estate
records or that they are other than
what they purport to be on their face.
On or about the
thirtieth (30th) day after the Closing Date, the Trustee
shall deliver to the Depositor, the Master
Servicer and Countrywide (on its
own behalf and on behalf of Park Granada,
Park Monaco and Park Sienna) a Delay
Delivery Certification with respect to the
Mortgage Loans in the form annexed
hereto as Exhibit G-1, with any applicable
exceptions noted thereon. Not later
than 90 days after the Closing Date, the
Trustee shall deliver to the
Depositor, the Master Servicer and the
Seller a Final Certification with
respect to the Mortgage Loans in the form
annexed hereto as Exhibit H, with
any applicable exceptions noted
thereon.
Not later than
90 days after the Closing Date, the Trustee shall deliver
to the Depositor, the Master Servicer and
Countrywide (on its own behalf and
on behalf of Park Granada, Park Monaco and
Park Sienna) a Final Certification
with respect to the Mortgage Loans in the
form annexed hereto as Exhibit H-1,
with any applicable exceptions noted
thereon.
If, in the
course of such review, the Trustee finds any document
constituting a part of a Mortgage File
which does not meet the requirements of
Section 2.01, the Trustee shall list such
as an exception in the Final
Certification; provided, however that the
Trustee shall not make any
determination as to whether (i) any
endorsement is sufficient to transfer all
right, title and interest of the party so
endorsing, as noteholder or assignee
thereof, in and to that Mortgage Note or
(ii) any assignment is in recordable
form or is sufficient to effect the
assignment of and transfer to
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the assignee thereof under the mortgage to
which the assignment relates.
Countrywide (on its own behalf and on
behalf of Park Granada, Park Monaco and
Park Sienna) shall promptly correct or cure
such defect within 90 days from
the date it was so notified of such defect
and, if Countrywide does not
correct or cure such defect within such
period, Countrywide (on its own behalf
and on behalf of Park Granada, Park Monaco
and Park Sienna) shall either (a)
substitute for the related Mortgage Loan a
Substitute Mortgage Loan, which
substitution shall be accomplished in the
manner and subject to the conditions
set forth in Section 2.03, or (b) purchase
such Mortgage Loan from the Trustee
within 90 days from the date Countrywide
(on its own behalf and on behalf of
Park Granada, Park Monaco and Park Sienna)
was notified of such defect in
writing at the Purchase Price of such
Mortgage Loan; provided, however, that
in no event shall such substitution or
purchase occur more than 540 days from
the Closing Date, except that if the
substitution or purchase of a Mortgage
Loan pursuant to this provision is required
by reason of a delay in delivery
of any documents by the appropriate
recording office, and there is a dispute
between either the Master Servicer or
Countrywide (on its own behalf and on
behalf of Park Granada, Park Monaco and
Park Sienna) and the Trustee over the
location or status of the recorded
document, then such substitution or
purchase shall occur within 720 days from
the Closing Date. The Trustee shall
deliver written notice to each Rating
Agency within 270 days from the Closing
Date indicating each Mortgage Loan (a)
which has not been returned by the
appropriate recording office or (b) as to
which there is a dispute as to
location or status of such Mortgage Loan.
Such notice shall be delivered every
90 days thereafter until the related
Mortgage Loan is returned to the Trustee.
Any such substitution pursuant to (a) above
or purchase pursuant to (b) above
shall not be effected prior to the delivery
to the Trustee of the Opinion of
Counsel required by Section 2.05 hereof, if
any, and any substitution pursuant
to (a) above shall not be effected prior to
the additional delivery to the
Trustee of a Request for Release
substantially in the form of Exhibit N. No
substitution is permitted to be made in any
calendar month after the
Determination Date for such month. The
Purchase Price for any such Mortgage
Loan shall be deposited by Countrywide (on
its own behalf and on behalf of
Park Granada, Park Monaco and Park Sienna)
in the Certificate Account on or
prior to the Distribution Account Deposit
Date for the Distribution Date in
the month following the month of repurchase
and, upon receipt of such deposit
and certification with respect thereto in
the form of Exhibit N hereto, the
Trustee shall release the related Mortgage
File to Countrywide (on its own
behalf and on behalf of Park Granada, Park
Monaco and Park Sienna) and shall
execute and deliver at Countrywide's (on
its own behalf and on behalf of Park
Granada, Park Monaco and Park Sienna)
request such instruments of transfer or
assignment prepared by Countrywide, in each
case without recourse, as shall be
necessary to vest in Countrywide (on its
own behalf and on behalf of Park
Granada, Park Monaco and Park Sienna), or
its designee, the Trustee's interest
in any Mortgage Loan released pursuant
hereto. If pursuant to the foregoing
provisions Countrywide (on its own behalf
and on behalf of Park Granada, Park
Monaco and Park Sienna) repurchases an
Mortgage Loan that is a MERS Mortgage
Loan, the Master Servicer shall either (i)
cause MERS to execute and deliver
an assignment of the Mortgage in recordable
form to transfer the Mortgage from
MERS to Countrywide (on its own behalf and
on behalf of Park Granada, Park
Monaco and Park Sienna) or its designee and
shall cause such Mortgage to be
removed from registration on the MERS(R)
System in accordance with MERS' rules
and regulations or (ii) cause MERS to
designate on the MERS(R) System
Countrywide (on its own behalf and on
behalf of Park Granada, Park Monaco and
Park Sienna) or its designee as the
beneficial holder of such Mortgage Loan.
(b)
[Reserved].
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(c)
[Reserved].
(d) The Trustee
shall retain possession and custody of each Mortgage File
in accordance with and subject to the terms
and conditions set forth herein.
The Master Servicer shall promptly deliver
to the Trustee, upon the execution
or receipt thereof, the originals of such
other documents or instruments
constituting the Mortgage File as come into
the possession of the Master
Servicer from time to time.
(e) (d) It is
understood and agreed that the respective obligations of
each Seller to substitute for or to
purchase any Mortgage Loan sold to the
Depositor by it which does not meet the
requirements of Section 2.01 above
shall constitute the sole remedy respecting
such defect available to the
Trustee, the Depositor and any
Certificateholder against that Seller.
SECTION 2.03.
Representations, Warranties and Covenants of the Sellers
and the Master Servicer.
(a) Countrywide
hereby makes the representations and warranties set forth
in (i) Schedule II-A, Schedule II-B,
Schedule II-C and Schedule II-D hereto,
and by this reference incorporated herein,
to the Depositor, the Master
Servicer and the Trustee, as of the Closing
Date, (ii) Schedule III-A hereto,
and by this reference incorporated herein,
to the Depositor, the Master
Servicer and the Trustee, as of the Closing
Date, or if so specified therein,
as of the Cut-off Date with respect to all
of the Mortgage Loans, and (iii)
Schedule III-B hereto, and by this
reference incorporated herein, to the
Depositor, the Master Servicer and the
Trustee, as of the Closing Date, or if
so specified therein, as of the Cut-off
Date with respect to the Mortgage
Loans that are Countrywide Mortgage Loans.
Park Granada hereby makes the
representations and warranties set forth in
(i) Schedule II-B hereto, and by
this reference incorporated herein, to the
Depositor, the Master Servicer and
the Trustee, as of the Closing Date and
(ii) Schedule III-C hereto, and by
this reference incorporated herein, to the
Depositor, the Master Servicer and
the Trustee, as of the Closing Date, or if
so specified therein, as of the
Cut-off Date with respect to the Mortgage
Loans that are Park Granada Mortgage
Loans. Park Monaco hereby makes the
representations and warranties set forth
in (i) Schedule II-C hereto, and by this
reference incorporated herein, to the
Depositor, the Master Servicer and the
Trustee, as of the Closing Date and
(ii) Schedule III-D hereto, and by this
reference incorporated herein, to the
Depositor, the Master Servicer and the
Trustee, as of the Closing Date, or if
so specified therein, as of the Cut-off
Date with respect to the Mortgage
Loans that are Park Monaco Mortgage Loans.
Park Sienna hereby makes the
representations and warranties set forth in
(i) Schedule II-D hereto, and by
this reference incorporated herein, to the
Depositor, the Master Servicer and
the Trustee, as of the Closing Date and
(ii) Schedule III-E hereto, and by
this reference incorporated herein, to the
Depositor, the Master Servicer and
the Trustee, as of the Closing Date, or if
so specified therein, as of the
Cut-off Date with respect to the Mortgage
Loans that are Park Sienna Mortgage
Loans.
(b) The Master
Servicer hereby makes the representations and warranties
set forth in Schedule IV hereto, and by
this reference incorporated herein to
the Depositor and the Trustee as of the
Closing Date.
(c) Upon
discovery by any of the parties hereto of a breach of a
representation or warranty with respect to
a Mortgage Loan made pursuant to
Section 2.03(a) that materially and
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adversely affects the interests of the
Certificateholders in that Mortgage
Loan, the party discovering such breach
shall give prompt notice thereof to
the other parties. Each Seller hereby
covenants that within 90 days of the
earlier of its discovery or its receipt of
written notice from any party of a
breach of any representation or warranty
with respect to a Mortgage Loan sold
by it pursuant to Section 2.03(a) which
materially and adversely affects the
interests of the Certificateholders in that
Mortgage Loan, it shall cure such
breach in all material respects, and if
such breach is not so cured, shall,
(i) if such 90-day period expires prior to
the second anniversary of the
Closing Date, remove such Mortgage Loan (a
"Deleted Mortgage Loan") from the
Trust Fund and substitute in its place a
Substitute Mortgage Loan, in the
manner and subject to the conditions set
forth in this Section; or (ii)
repurchase the affected Mortgage Loan or
Mortgage Loans from the Trustee at
the Purchase Price in the manner set forth
below; provided, however, that any
such substitution pursuant to (i) above
shall not be effected prior to the
delivery to the Trustee of the Opinion of
Counsel required by Section 2.05
hereof, if any, and any such substitution
pursuant to (i) above shall not be
effected prior to the additional delivery
to the Trustee of a Request for
Release substantially in the form of
Exhibit N and the Mortgage File for any
such Substitute Mortgage Loan. The Seller
repurchasing a Mortgage Loan
pursuant to this Section 2.03(c) shall
promptly reimburse the Master Servicer
and the Trustee for any expenses reasonably
incurred by the Master Servicer or
the Trustee in respect of enforcing the
remedies for such breach. With respect
to the representations and warranties
described in this Section which are made
to the best of a Seller's knowledge, if it
is discovered by either the
Depositor, a Seller or the Trustee that the
substance of such representation
and warranty is inaccurate and such
inaccuracy materially and adversely
affects the value of the related Mortgage
Loan or the interests of the
Certificateholders therein, notwithstanding
that Seller's lack of knowledge
with respect to the substance of such
representation or warranty, such
inaccuracy shall be deemed a breach of the
applicable representation or
warranty.
With respect to
any Substitute Mortgage Loan or Loans, sold to the
Depositor by a Seller, Countrywide (on its
own behalf and on behalf of Park
Granada, Park Monaco and Park Sienna) shall
deliver to the Trustee for the
benefit of the Certificateholders the
Mortgage Note, the Mortgage, the related
assignment of the Mortgage, and such other
documents and agreements as are
required by Section 2.01, with the Mortgage
Note endorsed and the Mortgage
assigned as required by Section 2.01. No
substitution is permitted to be made
in any calendar month after the
Determination Date for such month. Scheduled
Payments due with respect to Substitute
Mortgage Loans in the month of
substitution shall not be part of the Trust
Fund and will be retained by the
related Seller on the next succeeding
Distribution Date. For the month of
substitution, distributions to
Certificateholders will include the monthly
payment due on any Deleted Mortgage Loan
for such month and thereafter that
Seller shall be entitled to retain all
amounts received in respect of such
Deleted Mortgage Loan. The Master Servicer
shall amend the Mortgage Loan
Schedule for the benefit of the
Certificateholders to reflect the removal of
such Deleted Mortgage Loan and the
substitution of the Substitute Mortgage
Loan or Loans and the Master Servicer shall
deliver the amended Mortgage Loan
Schedule to the Trustee. Upon such
substitution, the Substitute Mortgage Loan
or Loans shall be subject to the terms of
this Agreement in all respects, and
the related Seller shall be deemed to have
made with respect to such
Substitute Mortgage Loan or Loans, as of
the date of substitution, the
representations and warranties made
pursuant to Section 2.03(a) with respect
to such Mortgage Loan. Upon any such
substitution and the deposit to the
Certificate Account of the amount required
to be deposited therein in
connection with such substitution as
described in the following paragraph,
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the Trustee shall release the Mortgage File
held for the benefit of the
Certificateholders relating to such Deleted
Mortgage Loan to the related
Seller and shall execute and deliver at
such Seller's direction such
instruments of transfer or assignment
prepared by Countrywide (on its own
behalf and on behalf of Park Granada, Park
Monaco and Park Sienna), in each
case without recourse, as shall be
necessary to vest title in that Seller, or
its designee, the Trustee's interest in any
Deleted Mortgage Loan substituted
for pursuant to this Section 2.03.
For any month in
which a Seller substitutes one or more Substitute
Mortgage Loans for one or more Deleted
Mortgage Loans, the Master Servicer
will determine the amount (if any) by which
the aggregate principal balance of
all Substitute Mortgage Loans sold to the
Depositor by that Seller as of the
date of substitution is less than the
aggregate Stated Principal Balance of
all Deleted Mortgage Loans repurchased by
that Seller (after application of
the scheduled principal portion of the
monthly payments due in the month of
substitution). The amount of such shortage
(the "Substitution Adjustment
Amount") plus an amount equal to the
aggregate of any unreimbursed Advances
with respect to such Deleted Mortgage Loans
shall be deposited in the
Certificate Account by Countrywide (on its
own behalf and on behalf of Park
Granada, Park Monaco and Park Sienna) on or
before the Distribution Account
Deposit Date for the Distribution Date in
the month succeeding the calendar
month during which the related Mortgage
Loan became required to be purchased
or replaced hereunder.
In the event
that a Seller shall have repurchased a Mortgage Loan, the
Purchase Price therefor shall be deposited
in the Certificate Account pursuant
to Section 3.05 on or before the
Distribution Account Deposit Date for the
Distribution Date in the month following
the month during which that Seller
became obligated hereunder to repurchase or
replace such Mortgage Loan and
upon such deposit of the Purchase Price,
the delivery of the Opinion of
Counsel required by Section 2.05 and
receipt of a Request for Release in the
form of Exhibit N hereto, the Trustee shall
release the related Mortgage File
held for the benefit of the
Certificateholders to such Person, and the Trustee
shall execute and deliver at such Person's
direction such instruments of
transfer or assignment prepared by such
Person, in each case without recourse,
as shall be necessary to transfer title
from the Trustee. It is understood and
agreed that the obligation under this
Agreement of any Person to cure,
repurchase or replace any Mortgage Loan as
to which a breach has occurred and
is continuing shall constitute the sole
remedy against such Persons respecting
such breach available to
Certificateholders, the Depositor or the Trustee on
their behalf.
The
representations and warranties made pursuant to this Section
2.03
shall survive delivery of the respective
Mortgage Files to the Trustee for the
benefit of the Certificateholders.
SECTION 2.04.
Representations and Warranties of the Depositor as to the
Mortgage Loans.
The Depositor
hereby represents and warrants to the Trustee with respect
to each Mortgage Loan as of the date hereof
or such other date set forth
herein that as of the Closing Date, and
following the transfer of the Mortgage
Loans to it by each Seller, the Depositor
had good title to the Mortgage Loans
and the Mortgage Notes were subject to no
offsets, defenses or counterclaims.
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The Depositor
hereby assigns, transfers and conveys to the Trustee all of
its rights with respect to the Mortgage
Loans including, without limitation,
the representations and warranties of each
Seller made pursuant to Section
2.03(a)(ii) hereof, together with all
rights of the Depositor to require each
Seller to cure any breach thereof or to
repurchase or substitute for any
affected Mortgage Loan in accordance with
this Agreement.
It is understood
and agreed that the representations and warranties set
forth in this Section 2.04 shall survive
delivery of the Mortgage Files to the
Trustee. Upon discovery by the Depositor or
the Trustee of a breach of any of
the foregoing representations and
warranties set forth in this Section 2.04
(referred to herein as a "breach"), which
breach materially and adversely
affects the interest of the
Certificateholders, the party discovering such
breach shall give prompt written notice to
the others and to each Rating
Agency.
SECTION 2.05.
Delivery of Opinion of Counsel in Connection with
Substitutions.
(a)
Notwithstanding any contrary provision of this Agreement, no
substitution pursuant to Section 2.02 or
Section 2.03 shall be made more than
90 days after the Closing Date unless
Countrywide delivers to the Trustee an
Opinion of Counsel, which Opinion of
Counsel shall not be at the expense of
either the Trustee or the Trust Fund,
addressed to the Trustee, to the effect
that such substitution will not (i) result
in the imposition of the tax on
"prohibited transactions" on the Trust Fund
or contributions after the Startup
Date, as defined in Sections 860F(a)(2) and
860G(d) of the Code, respectively,
or (ii) cause each REMIC created hereunder
to fail to qualify as a REMIC at
any time that any Certificates are
outstanding.
(b) Upon
discovery by the Depositor, a Seller, the Master Servicer, or
the Trustee that any Mortgage Loan does not
constitute a "qualified mortgage"
within the meaning of Section 860G(a)(3) of
the Code, the party discovering
such fact shall promptly (and in any event
within five (5) Business Days of
discovery) give written notice thereof to
the other parties. In connection
therewith, the Trustee shall require
Countrywide (on its own behalf and on
behalf of Park Granada, Park Monaco and
Park Sienna), at its option, to either
(i) substitute, if the conditions in
Section 2.03(c) with respect to
substitutions are satisfied, a Substitute
Mortgage Loan for the affected
Mortgage Loan, or (ii) repurchase the
affected Mortgage Loan within 90 days of
such discovery in the same manner as it
would a Mortgage Loan for a breach of
representation or warranty made pursuant to
Section 2.03. The Trustee shall
reconvey to Countrywide the Mortgage Loan
to be released pursuant hereto in
the same manner, and on the same terms and
conditions, as it would a Mortgage
Loan repurchased for breach of a
representation or warranty contained in
Section 2.03.
SECTION 2.06.
Execution and Delivery of Certificates.
The Trustee
acknowledges the transfer and assignment to it of the Trust
Fund and, concurrently with such transfer
and assignment, has executed and
delivered to or upon the order of the
Depositor, the Certificates in
authorized denominations evidencing
directly or indirectly the entire
ownership of the Trust Fund. The Trustee
agrees to hold the Trust Fund and
exercise the rights referred to above for
the benefit of all present and
future Holders of the Certificates and to
perform the duties set forth in this
Agreement, to the end that the interests of
the Holders of the Certificates
may be adequately and effectively
protected.
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SECTION 2.07.
REMIC Matters.
The Preliminary
Statement sets forth the designations and "latest
possible maturity date" for federal income
tax purposes of all interests
created hereby. The "Startup Day" for
purposes of the REMIC Provisions shall
be the Closing Date. The "tax matters
person" with respect to each REMIC
hereunder shall be the Trustee and the
Trustee shall hold the Tax Matters
Person Certificate. Each REMIC's fiscal
year shall be the calendar year.
SECTION 2.08.
Covenants of the Master Servicer.
The Master
Servicer hereby covenants to the Depositor and the Trustee as
follows:
(a) the Master
Servicer shall comply in the performance of its
obligations under this Agreement with all
reasonable rules and requirements of
the insurer under each Required Insurance
Policy; and
(b) no written
information, certificate of an officer, statement
furnished in writing or written report
delivered to the Depositor, any
affiliate of the Depositor or the Trustee
and prepared by the Master Servicer
pursuant to this Agreement will contain any
untrue statement of a material
fact or omit to state a material fact
necessary to make such information,
certificate, statement or report not
misleading.
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ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
SECTION 3.01.
Master Servicer to Service Mortgage Loans.
For and on
behalf of the Certificateholders, the Master Servicer shall
service and administer the Mortgage Loans
in accordance with the terms of this
Agreement and customary and usual standards
of practice of prudent mortgage
loan servicers. In connection with such
servicing and administration, the
Master Servicer shall have full power and
authority, acting alone and/or
through Subservicers as provided in Section
3.02 hereof, subject to the terms
hereof (i) to execute and deliver, on
behalf of the Certificateholders and the
Trustee, customary consents or waivers and
other instruments and documents,
(ii) to consent to transfers of any
Mortgaged Property and assumptions of the
Mortgage Notes and related Mortgages (but
only in the manner provided in this
Agreement), (iii) to collect any Insurance
Proceeds and other Liquidation
Proceeds (which for the purpose of this
Section includes any Subsequent
Recoveries), and (iv) to effectuate
foreclosure or other conversion of the
ownership of the Mortgaged Property
securing any Mortgage Loan; provided that
the Master Servicer shall not take any
action that is inconsistent with or
prejudices the interests of the Trust Fund
or the Certificateholders in any
Mortgage Loan or the rights and interests
of the Depositor, the Trustee and
the Certificateholders under this
Agreement. The Master Servicer shall
represent and protect the interests of the
Trust Fund in the same manner as it
protects its own interests in mortgage
loans in its own portfolio in any
claim, proceeding or litigation regarding a
Mortgage Loan, and shall not make
or permit any modification, waiver or
amendment of any Mortgage Loan which
would cause any REMIC created hereunder to
fail to qualify as a REMIC or
result in the imposition of any tax under
Section 860F(a) or Section 860G(d)
of the Code. Without limiting the
generality of the foregoing, the Master
Servicer, in its own name or in the name of
the Depositor and the Trustee, is
hereby authorized and empowered by the
Depositor and the Trustee, when the
Master Servicer believes it appropriate in
its reasonable judgment, to execute
and deliver, on behalf of the Trustee, the
Depositor, the Certificateholders
or any of them, any and all instruments of
satisfaction or cancellation, or of
partial or full release or discharge and
all other comparable instruments,
with respect to the Mortgage Loans, and
with respect to the Mortgaged
Properties held for the benefit of the
Certificateholders. The Master Servicer
shall prepare and deliver to the Depositor
and/or the Trustee such documents
requiring execution and delivery by either
or both of them as are necessary or
appropriate to enable the Master Servicer
to service and administer the
Mortgage Loans to the extent that the
Master Servicer is not permitted to
execute and deliver such documents pursuant
to the preceding sentence. Upon
receipt of such documents, the Depositor
and/or the Trustee shall execute such
documents and deliver them to the Master
Servicer. The Master Servicer further
is authorized and empowered by the Trustee,
on behalf of the
Certificateholders and the Trustee, in its
own name or in the name of the
Subservicer, when the Master Servicer or
the Subservicer, as the case may be,
believes it appropriate in its best
judgment to register any Mortgage Loan on
the MERS(R) System, or cause the removal
from the registration of any Mortgage
Loan on the MERS(R) System, to execute and
deliver, on behalf of the Trustee
and the Certificateholders or any of them,
any and all instruments of
assignment and other comparable instruments
with respect to such assignment or
re-recording of a Mortgage in the name of
MERS, solely as nominee for the
Trustee and its successors and assigns.
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In accordance
with the standards of the preceding paragraph, the Master
Servicer shall advance or cause to be
advanced funds as necessary for the
purpose of effecting the payment of taxes
and assessments on the Mortgaged
Properties, which advances shall be
reimbursable in the first instance from
related collections from the Mortgagors
pursuant to Section 3.06, and further
as provided in Section 3.08. The costs
incurred by the Master Servicer, if
any, in effecting the timely payments of
taxes and assessments on the
Mortgaged Properties and related insurance
premiums shall not, for the purpose
of calculating monthly distributions to the
Certificateholders, be added to
the Stated Principal Balances of the
related Mortgage Loans, notwithstanding
that the terms of such Mortgage Loans so
permit.
SECTION 3.02.
Subservicing; Enforcement of the Obligations of
Subservicers.
(a) The Master
Servicer may arrange for the subservicing of any Mortgage
Loan by a Subservicer pursuant to a
subservicing agreement; provided, however,
that such subservicing arrangement and the
terms of the related subservicing
agreement must provide for the servicing of
such Mortgage Loans in a manner
consistent with the servicing arrangements
contemplated hereunder. Unless the
context otherwise requires, references in
this Agreement to actions taken or
to be taken by the Master Servicer in
servicing the Mortgage Loans include
actions taken or to be taken by a
Subservicer on behalf of the Master
Servicer. Notwithstanding the provisions of
any subservicing agreement, any of
the provisions of this Agreement relating
to agreements or arrangements
between the Master Servicer and a
Subservicer or reference to actions taken
through a Subservicer or otherwise, the
Master Servicer shall remain obligated
and liable to the Depositor, the Trustee
and the Certificateholders for the
servicing and administration of the
Mortgage Loans in accordance with the
provisions of this Agreement without
diminution of such obligation or
liability by virtue of such subservicing
agreements or arrangements or by
virtue of indemnification from the
Subservicer and to the same extent and
under the same terms and conditions as if
the Master Servicer alone were
servicing and administering the Mortgage
Loans. All actions of each
Subservicer performed pursuant to the
related subservicing agreement shall be
performed as an agent of the Master
Servicer with the same force and effect as
if performed directly by the Master
Servicer.
(b) For purposes
of this Agreement, the Master Servicer shall be deemed
to have received any collections,
recoveries or payments with respect to the
Mortgage Loans that are received by a
Subservicer regardless of whether such
payments are remitted by the Subservicer to
the Master Servicer.
SECTION 3.03.
Rights of the Depositor and the Trustee in Respect of the
Master Servicer.
The Depositor
may, but is not obligated to, enforce the obligations of
the Master Servicer hereunder and may, but
is not obligated to, perform, or
cause a designee to perform, any defaulted
obligation of the Master Servicer
hereunder and in connection with any such
defaulted obligation to exercise the
related rights of the Master Servicer
hereunder; provided that the Master
Servicer shall not be relieved of any of
its obligations hereunder by virtue
of such performance by the Depositor or its
designee. Neither the Trustee nor
the Depositor shall have any responsibility
or liability for any action or
failure to act by the Master Servicer nor
shall the
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Trustee or the Depositor be obligated to
supervise the performance of the
Master Servicer hereunder or otherwise.
SECTION 3.04.
Trustee to Act as Master Servicer.
In the event
that the Master Servicer shall for any reason no longer be
the Master Servicer hereunder (including by
reason of an Event of Default),
the Trustee or its successor shall
thereupon assume all of the rights and
obligations of the Master Servicer
hereunder arising thereafter (except that
the Trustee shall not be (i) liable for
losses of the Master Servicer pursuant
to Section 3.09 hereof or any acts or
omissions of the predecessor Master
Servicer hereunder), (ii) obligated to make
Advances if it is prohibited from
doing so by applicable law, (iii) obligated
to effectuate repurchases or
substitutions of Mortgage Loans hereunder
including, but not limited to,
repurchases or substitutions of Mortgage
Loans pursuant to Section 2.02 or
2.03 hereof, (iv) responsible for expenses
of the Master Servicer pursuant to
Section 2.03 or (v) deemed to have made any
representations and warranties of
the Master Servicer hereunder). Any such
assumption shall be subject to
Section 7.02 hereof. If the Master Servicer
shall for any reason no longer be
the Master Servicer (including by reason of
any Event of Default), the Trustee
or its successor shall succeed to any
rights and obligations of the Master
Servicer under each subservicing
agreement.
The Master
Servicer shall, upon request of the Trustee, but at the
expense of the Master Servicer, deliver to
the assuming party all documents
and records relating to each subservicing
agreement or substitute subservicing
agreement and the Mortgage Loans then being
serviced thereunder and an
accounting of amounts collected or held by
it and otherwise use its best
efforts to effect the orderly and efficient
transfer of the substitute
subservicing agreement to the assuming
party.
SECTION 3.05.
Collection of Mortgage Loan Payments; Certificate Account;
Distribution Account; Corridor Contract
Reserve Fund; Class C Distribution
Account.
(a) The Master
Servicer shall make reasonable efforts in accordance with
the customary and usual standards of
practice of prudent mortgage servicers to
collect all payments called for under the
terms and provisions of the Mortgage
Loans to the extent such procedures shall
be consistent with this Agreement
and the terms and provisions of any related
Required Insurance Policy.
Consistent with the foregoing, the Master
Servicer may in its discretion (i)
waive any late payment charge or any
prepayment charge or penalty interest in
connection with the prepayment of a
Mortgage Loan and (ii) extend the due
dates for payments due on a Mortgage Note
for a period not greater than 180
days; provided, however, that the Master
Servicer cannot extend the maturity
of any such Mortgage Loan past the date on
which the final payment is due on
the latest maturing Mortgage Loan as of the
Cut-off Date. In the event of any
such arrangement, the Master Servicer shall
make Advances on the related
Mortgage Loan in accordance with the
provisions of Section 4.01 during the
scheduled period in accordance with the
amortization schedule of such Mortgage
Loan without modification thereof by reason
of such arrangements. The Master
Servicer shall not be required to institute
or join in litigation with respect
to collection of any payment (whether under
a Mortgage, Mortgage Note or
otherwise or against any public or
governmental authority with respect to a
taking or condemnation) if it
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reasonably believes that enforcing the
provision of the Mortgage or other
instrument pursuant to which such payment
is required is prohibited by
applicable law.
(b) The Master
Servicer shall establish and maintain a Certificate
Account into which the Master Servicer
shall deposit or cause to be deposited
no later than two Business Days after
receipt (or, if the current long-term
credit rating of Countrywide is reduced
below "A-" by S&P or "A3" by Moody's,
the Master Servicer shall deposit or cause
to be deposited on a daily basis
within one Business Day of receipt), except
as otherwise specifically provided
herein, the following payments and
collections remitted by Subservicers or
received by it in respect of Mortgage Loans
subsequent to the Cut-off Date
(other than in respect of principal and
interest due on the Mortgage Loans on
or before the Cut-off Date) and the
following amounts required to be deposited
hereunder:
(i) all payments
on account of principal on the Mortgage Loans, including
Principal Prepayments;
(ii) all
payments on account of interest on the Mortgage Loans, net of
the Master Servicing Fee and any
lender-paid mortgage insurance premiums;
(iii) all
Insurance Proceeds, Subsequent Recoveries and Liquidation
Proceeds, other than proceeds to be applied
to the restoration or repair of
the Mortgaged Property or released to the
Mortgagor in accordance with the
Master Servicer's normal servicing
procedures;
(iv) any amount
required to be deposited by the Master Servicer or the
Depositor pursuant to Section 3.05(e) in
connection with any losses on
Permitted Investments for which it is
responsible;
(v) any amounts
required to be deposited by the Master Servicer pursuant
to Section 3.09(c) and in respect of net
monthly rental income from REO
Property pursuant to Section 3.11
hereof;
(vi) all
Substitution Adjustment Amounts;
(vii) all
Advances made by the Master Servicer pursuant to Section 4.01;
and
(viii) any other
amounts required to be deposited hereunder.
In addition,
with respect to any Mortgage Loan that is subject to a
buydown agreement, on each Due Date for
such Mortgage Loan, in addition to the
monthly payment remitted by the Mortgagor,
the Master Servicer shall cause
funds to be deposited into the Certificate
Account in an amount required to
cause an amount of interest to be paid with
respect to such Mortgage Loan
equal to the amount of interest that has
accrued on such Mortgage Loan from
the preceding Due Date at the Mortgage Rate
net of the Master Servicing Fee.
The foregoing
requirements for remittance by the Master Servicer shall be
exclusive, it being understood and agreed
that, without limiting the
generality of the foregoing, payments in
the nature of prepayment penalties,
late payment charges or assumption fees, if
collected, need not be remitted by
the Master Servicer. In the event that the
Master Servicer shall remit any
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amount not required to be remitted, it may
at any time withdraw or direct the
institution maintaining the Certificate
Account to withdraw such amount from
the Certificate Account, any provision
herein to the contrary notwithstanding.
Such withdrawal or direction may be
accomplished by delivering written notice
thereof to the Trustee or such other
institution maintaining the Certificate
Account which describes the amounts
deposited in error in the Certificate
Account. The Master Servicer shall maintain
adequate records with respect to
all withdrawals made pursuant to this
Section. All funds deposited in the
Certificate Account shall be held in trust
for the Certificateholders until
withdrawn in accordance with Section
3.08.
(c)
[Reserved].
(d) The Trustee
shall establish and maintain, on behalf of the
Certificateholders, the Distribution
Account. The Trustee shall, promptly upon
receipt, deposit in the Distribution
Account and retain therein the following:
(i)
the aggregate amount remitted by the Master Servicer to the
Trustee
pursuant to Section
3.08(a)(ix);
(ii)
any amount deposited by the Master Servicer pursuant to Section
3.05(e) in connection with
any losses on Permitted Investments for which it
is responsible; and
(iii) any other amounts deposited hereunder which are required to
be
deposited in the
Distribution Account.
In the event
that the Master Servicer shall remit any amount not required
to be remitted, it may at any time direct
the Trustee to withdraw such amount
from the Distribution Account, any
provision herein to the contrary
notwithstanding. Such direction may be
accomplished by delivering an Officer's
Certificate to the Trustee which describes
the amounts deposited in error in
the Distribution Account. All funds
deposited in the Distribution Account
shall be held by the Trustee in trust for
the Certificateholders until
disbursed in accordance with this Agreement
or withdrawn in accordance with
Section 3.08. In no event shall the Trustee
incur liability for withdrawals
from the Distribution Account at the
direction of the Master Servicer.
(e) Each
institution at which the Certificate Account or the
Distribution
Account is maintained shall invest the
funds therein as directed in writing by
the Master Servicer, in the case of the
Certificate Account, or by the
Trustee, in the case of the Distribution
Account, in Permitted Investments,
which shall mature not later than (i) in
the case of the Certificate Account,
the second Business Day next preceding the
related Master Servicer Remittance
Date (except that if such Permitted
Investment is an obligation of the
institution that maintains such account,
then such Permitted Investment shall
mature not later than the Business Day next
preceding such Master Servicer
Remittance Date) and (ii) in the case of
the Distribution Account, the
Business Day next preceding the
Distribution Date (except that if such
Permitted Investment is an obligation of
the institution that maintains such
fund or account, then such Permitted
Investment shall mature not later than
such Distribution Date) and, in each case,
shall not be sold or disposed of
prior to its maturity. All such Permitted
Investments shall be made in the
name of the Trustee, for the benefit of the
Certificateholders. All income and
gain net of any losses realized from any
such investment of funds on deposit
in the Certificate Account shall be
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for the benefit of the Master Servicer as
servicing compensation and shall be
remitted to it monthly as provided herein.
All income and gain net of any
losses realized from any such investment of
funds on deposit in the
Distribution Account shall be distributed
in accordance with the following
paragraph for the benefit of the Trustee,
as compensation for its duties
hereunder, or the Master Servicer, as
servicing compensation, and the
respective portions to which each shall be
entitled shall be remitted to them
monthly as provided herein. The amount of
any realized losses in the
Certificate Account incurred in any such
account in respect of any such
investments shall promptly be deposited by
the Master Servicer in the
Certificate Account. The Trustee in its
fiduciary capacity shall not be liable
for the amount of any loss incurred in
respect of any investment or lack of
investment of funds held in the Certificate
Account and made in accordance
with this Section 3.05.
With respect to
each Distribution Date, (1) all income and gain net of
the Trustee's portion of any losses
realized from any such investment of funds
on deposit in the Distribution Account
during the seven (7) calendar days
immediately following the related Master
Servicer Remittance Date and (2) the
excess of (x) all investment income and
gain net of the Master Servicer's
portion of any losses realized from any
such investment of funds on deposit in
the Distribution Account over (y) the
amount paid to the Trustee pursuant to
clause (1) of this sentence shall be for
the benefit of the Master Servicer as
compensation and such amounts shall be
remitted to the Trustee and Master
Servicer, respectively, monthly as provided
herein. In the event that there
are any realized losses from the investment
of funds on deposit in the
Distribution Account, the proportion of
such realized loss payable by the
Trustee and the Master Servicer shall be
allocated pursuant to the following
formula: (i) with respect to the Trustee,
the product of (x) the amount of the
realized loss and (y) a fraction, the
numerator of which is 5 and the
denominator of which is the actual number
of days from the Master Servicer
Remittance Date to and including the
Distribution Date and (ii) with respect
to the Master Servicer, the product of (x)
the amount of the realized loss and
(y) a fraction, not less than zero, the
numerator of which is the excess, if
any, of (a) the actual number of days from
the Master Servicer Remittance Date
to and including the Distribution Date
minus (b) 7, and the denominator of
which is the actual number of days from the
Master Servicer Remittance Date to
and including the Distribution Date. Each
of the Trustee and the Master
Servicer shall promptly deposit in the
Distribution Account their respective
portion of any realized loss calculated
pursuant to the preceding sentence.
(f) The Master
Servicer shall give notice to the Trustee, each Seller,
each Rating Agency and the Depositor of any
proposed change of the location of
the Certificate Account prior to any change
thereof. The Trustee shall give
notice to the Master Servicer, each Seller,
each Rating Agency and the
Depositor of any proposed change of the
location of the Distribution Account
prior to any change thereof.
(g) The Trustee
shall establish and maintain the Class C Distribution
Account and shall administer it in
accordance with this Agreement. On the
Closing Date, the Trustee shall deposit
$100 into the Class C Distribution
Account. The institution at which the Class
C Distribution Account is
maintained shall hold such funds on deposit
uninvested.
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All funds
deposited in the Class C Distribution Account shall be held by
the Trustee in trust for the Holder of the
Class C Certificates until
disbursed in accordance with Section
4.02(b) hereof.
(h) On the
Closing Date, the Trustee shall establish and maintain in its
name, in trust for the benefit of the
Holders of the Class 2-A-6 Certificates,
the Corridor Contract Reserve Fund, and
shall deposit $1,000 therein upon
receipt of such amount from or on behalf of
the Depositor. The Corridor
Contract Reserve Fund shall be an Eligible
Account and all funds on deposit in
the Corridor Contract Reserve Fund shall be
held separate and apart from, and
shall not be commingled with, any other
moneys, including without limitation,
other moneys held by the Trustee pursuant
to this Agreement.
On each
Distribution Date, the Trustee shall deposit into the Corridor
Contract Reserve Fund all amounts received
in respect of the Corridor Contract
for the related Interest Accrual Period.
The Trustee shall make withdrawals
from the Corridor Contract Reserve Fund to
make distributions pursuant to
Section 4.09 exclusively (other than as
expressly provided for in Section
3.08).
Funds in the
Corridor Contract Reserve Fund may be invested in Permitted
Investments at the direction of Bear,
Stearns & Co. Inc., which Permitted
Investments shall mature not later than the
Business Day immediately preceding
the first Distribution Date that follows
the date of such investment (except
that if such Permitted Investment is an
obligation of the institution that
maintains the Corridor Contract Reserve
Fund, then such Permitted Investment
shall mature not later than such
Distribution Date) and shall not be sold or
disposed of prior to maturity. All such
Permitted Investments shall be made in
the name of the Trustee, for the benefit of
the Holders of the Class 2-A-6
Certificates. In the absence of such
written direction, all funds in the
Corridor Contract Reserve Fund shall be
invested by the Trustee in The Bank of
New York cash reserves. Any net investment
earnings on such amounts shall be
retained therein until withdrawn as
provided in Section 3.08. Any losses
incurred in the Corridor Contract Reserve
Fund in respect of any such
investments shall be charged against
amounts on deposit in the Corridor
Contract Reserve Fund (or such investments)
immediately as realized. The
Trustee shall not be liable for the amount
of any loss incurred in respect of
any investment or lack of investment of
funds held in the Corridor Contract
Reserve Fund and made in accordance with
this Section 3.05. The Corridor
Contract Reserve Fund will not constitute
an asset of any REMIC created
hereunder. The Class 2-A-6 Certificates
shall evidence ownership of the
Corridor Contract Reserve Fund for federal
income tax purposes.
SECTION 3.06.
Collection of Taxes, Assessments and Similar Items; Escrow
Accounts.
(a) To the
extent required by the related Mortgage Note and not violative
of current law, the Master Servicer shall
establish and maintain one or more
accounts (each, an "Escrow Account") and
deposit and retain therein all
collections from the Mortgagors (or
advances by the Master Servicer) for the
payment of taxes, assessments, hazard
insurance premiums or comparable items
for the account of the Mortgagors. Nothing
herein shall require the Master
Servicer to compel a Mortgagor to establish
an Escrow Account in violation of
applicable law.
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(b) Withdrawals
of amounts so collected from the Escrow Accounts may be
made only to effect timely payment of
taxes, assessments, hazard insurance
premiums, condominium or PUD association
dues, or comparable items, to
reimburse the Master Servicer out of
related collections for any payments made
pursuant to Sections 3.01 hereof (with
respect to taxes and assessments and
insurance premiums) and 3.09 hereof (with
respect to hazard insurance), to
refund to any Mortgagors any sums
determined to be overages, to pay interest,
if required by law or the terms of the
related Mortgage or Mortgage Note, to
Mortgagors on balances in the Escrow
Account or to clear and terminate the
Escrow Account at the termination of this
Agreement in accordance with Section
9.01 hereof. The Escrow Accounts shall not
be a part of the Trust Fund.
(c) The Master
Servicer shall advance any payments referred to in Section
3.06(a) that are not timely paid by the
Mortgagors on the date when the tax,
premium or other cost for which such
payment is intended is due, but the
Master Servicer shall be required so to
advance only to the extent that such
advances, in the good faith judgment of the
Master Servicer, will be
recoverable by the Master Servicer out of
Insurance Proceeds, Liquidation
Proceeds or otherwise.
SECTION 3.07.
Access to Certain Documentation and Information Regarding
the Mortgage Loans.
The Master
Servicer shall afford each Seller, the Depositor and the
Trustee reasonable access to all records
and documentation regarding the
Mortgage Loans and all accounts, insurance
information and other matters
relating to this Agreement, such access
being afforded without charge, but
only upon reasonable request and during
normal business hours at the office
designated by the Master Servicer.
Upon reasonable
advance notice in writing, the Master Servicer will
provide to each Certificateholder and/or
Certificate Owner which is a savings
and loan association, bank or insurance
company certain reports and reasonable
access to information and documentation
regarding the Mortgage Loans
sufficient to permit such Certificateholder
and/or Certificate Owner to comply
with applicable regulations of the OTS or
other regulatory authorities with
respect to investment in the Certificates;
provided that the Master Servicer
shall be entitled to be reimbursed by each
such Certificateholder and/or
Certificate Owner for actual expenses
incurred by the Master Servicer in
providing such reports and access.
SECTION 3.08.
Permitted Withdrawals from the Certificate Account, the
Distribution Account and the Corridor
Contract Reserve Fund.
(a) The Master
Servicer may from time to time make withdrawals from the
Certificate Account for the following
purposes:
(i)
to pay to the Master Servicer (to the extent not previously
retained by the Master
Servicer) the servicing compensation to which it is
entitled pursuant to Section
3.14, and to pay to the Master Servicer, as
additional servicing
compensation, earnings on or investment income with
respect to funds in or
credited to the Certificate Account;
(ii)
to reimburse each of the Master Servicer and the Trustee for
unreimbursed Advances made
by it, such right of reimbursement pursuant to
this subclause (ii)
being
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limited to amounts received
on the Mortgage Loan(s) in respect of which any
such Advance was made;
(iii) to reimburse each of the Master Servicer and the Trustee for
any
Nonrecoverable Advance
previously made by it;
(iv)
to reimburse the Master Servicer for Insured Expenses from the
related Insurance
Proceeds;
(v)
to reimburse the Master Servicer for (a) unreimbursed Servicing
Advances, the Master
Servicer's right to reimbursement pursuant to this
clause (a) with respect to
any Mortgage Loan being limited to amounts
received on such Mortgage
Loan(s) which represent late recoveries of the
payments for which such
advances were made pursuant to Section 3.01 or
Section 3.06 and (b) for
unpaid Master Servicing Fees as provided in
Section 3.11 hereof;
(vi)
to pay to the purchaser, with respect to each Mortgage Loan or
property acquired in respect
thereof that has been purchased pursuant to
Section 2.02, 2.03 or 3.11,
all amounts received thereon after the date of
such purchase;
(vii) to reimburse the Sellers, the Master Servicer or the
Depositor
for expenses incurred by any
of them and reimbursable pursuant to Section
6.03 hereof;
(viii) to withdraw any amount deposited in the Certificate Account
and
not required to be deposited
therein;
(ix)
on or prior to the Master Servicer Remittance Date, to withdraw
an
amount equal to the related
Available Funds for such Distribution Date and
remit such amount to the
Trustee for deposit in the Distribution Account;
and
(x)
to clear and terminate the Certificate Account upon termination
of
this Agreement pursuant to
Section 9.01 hereof.
The Master
Servicer shall keep and maintain separate accounting, on a
Mortgage Loan by Mortgage Loan basis, for
the purpose of justifying any
withdrawal from the Certificate Account
pursuant to such subclauses (i), (ii),
(iv), (v) and (vi). Prior to making any
withdrawal from the Certificate
Account pursuant to subclause (iii), the
Master Servicer shall deliver to the
Trustee an Officer's Certificate of a
Servicing Officer indicating the amount
of any previous Advance determined by the
Master Servicer to be a
Nonrecoverable Advance and identifying the
related Mortgage Loans(s), and
their respective portions of such
Nonrecoverable Advance.
(b) The Trustee
shall withdraw funds from the Distribution Account for
distributions to Certificateholders, in the
manner specified in this Agreement
(and to withhold from the amounts so
withdrawn, the amount of any taxes that
it is authorized to withhold pursuant to
the second to last paragraph of
Section 8.11). In addition, the Trustee may
from time to time make withdrawals
from the Distribution Account for the
following purposes:
(i)
with respect to each Distribution Date, to pay to itself as
compensation for its
services hereunder any investment income earned on
amounts on deposit in the
Distribution
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Account during the seven (7)
calendar days immediately following the
related Master Servicer
Remittance Date;
(ii)
with respect to each Distribution Date, to pay to the Master
Servicer as additional
servicing compensation the excess, if any, of the
investment income earned on
amounts on deposit in the Distribution Account
over the amount paid to the
Trustee pursuant to clause (i) above;
(iii) to withdraw and return to the Master Servicer any amount
deposited in the
Distribution Account and not required to be deposited
therein;
(iv)
to reimburse the Trustee for any unreimbursed Advances made by
it
pursuant to Section 4.01(b)
hereof, such right of reimbursement pursuant to
this subclause (iv) being
limited to (x) amounts received on the related
Mortgage Loan(s) in respect
of which any such Advance was made and (y)
amounts not otherwise
reimbursed to the Trustee pursuant to Section
3.08(a)(ii) hereof;
(v)
to reimburse the Trustee for any Nonrecoverable Advance
previously
made by the Trustee pursuant
to Section 4.01(b) hereof, such right of
reimbursement pursuant to
this subclause (v) being limited to amounts not
otherwise reimbursed to the
Trustee pursuant to Section 3.08(a)(iii)
hereof; and
(vi)
to clear and terminate the Distribution Account upon
termination
of the Agreement pursuant to
Section 9.01 hereof.
(c) The Trustee
shall withdraw funds from the Corridor Contract Reserve
Fund for distribution to the Class 2-A-6
Certificates in the manner specified
in Section 4.09 (and to withhold from the
amounts so withdrawn the amount of
any taxes that it is authorized to retain
pursuant to the last paragraph of
Section 8.11). In addition, the Trustee may
from time to time make withdrawals
from the Corridor Contract Reserve Fund for
the following purposes:
(i)
to withdraw any amount deposited in the Corridor Contract
Reserve
Fund and not required to be
deposited therein; and
(ii)
to clear and terminate the Corridor Contract Reserve Fund upon
the
earliest of (x) the
reduction of the Class Certificate Balance of the Class
2-A-6 Certificates to zero,
(y) the scheduled termination date of the
Corridor Contract and (z)
the termination of this Agreement pursuant to
Section 9.01.
SECTION 3.09.
Maintenance of Hazard Insurance; Maintenance of Primary
Insurance Policies.
(a) The Master
Servicer shall cause to be maintained, for each Mortgage
Loan, hazard insurance with extended
coverage in an amount that is at least
equal to the lesser of (i) the maximum
insurable value of the improvements
securing such Mortgage Loan or (ii) the
greater of (y) the outstanding
principal balance of the Mortgage Loan and
(z) an amount such that the
proceeds of such policy shall be sufficient
to prevent the Mortgagor and/or
the mortgagee from becoming a co-insurer.
Each such policy of standard hazard
insurance shall contain, or have an
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accompanying endorsement that contains, a
standard mortgagee clause. Any
amounts collected by the Master Servicer
under any such policies (other than
the amounts to be applied to the
restoration or repair of the related
Mortgaged Property or amounts released to
the Mortgagor in accordance with the
Master Servicer's normal servicing
procedures) shall be deposited in the
Certificate Account. Any cost incurred by
the Master Servicer in maintaining
any such insurance shall not, for the
purpose of calculating monthly
distributions to the Certificateholders or
remittances to the Trustee for
their benefit, be added to the principal
balance of the Mortgage Loan,
notwithstanding that the terms of the
Mortgage Loan so permit. Such costs
shall be recoverable by the Master Servicer
out of late payments by the
related Mortgagor or out of Liquidation
Proceeds or Subsequent Recoveries to
the extent permitted by Section 3.08
hereof. It is understood and agreed that
no earthquake or other additional insurance
is to be required of any Mortgagor
or maintained on property acquired in
respect of a Mortgage other than
pursuant to such applicable laws and
regulations as shall at any time be in
force and as shall require such additional
insurance. If the Mortgaged
Property is located at the time of
origination of the Mortgage Loan in a
federally designated special flood hazard
area and such area is participating
in the national flood insurance program,
the Master Servicer shall cause flood
insurance to be maintained with respect to
such Mortgage Loan. Such flood
insurance shall be in an amount equal to
the least of (i) the outstanding
principal balance of the related Mortgage
Loan, (ii) the replacement value of
the improvements which are part of such
Mortgaged Property, and (iii) the
maximum amount of such insurance available
for the related Mortgaged Property
under the national flood insurance
program.
(b) The Master
Servicer shall not take any action which would result in
non-coverage under any applicable Primary
Insurance Policy of any loss which,
but for the actions of the Master Servicer,
would have been covered
thereunder. The Master Servicer shall not
cancel or refuse to renew any such
Primary Insurance Policy that is in effect
at the date of the initial issuance
of the Certificates and is required to be
kept in force hereunder unless the
replacement Primary Insurance Policy for
such canceled or non-renewed policy
is maintained with a Qualified Insurer.
Except with
respect to any Lender PMI Mortgage Loans, the Master Servicer
shall not be required to maintain any
Primary Insurance Policy (i) with
respect to any Mortgage Loan with a
Loan-to-Value Ratio less than or equal to
80% as of any date of determination or,
based on a new appraisal, the
principal balance of such Mortgage Loan
represents 80% or less of the new
appraised value or (ii) if maintaining such
Primary Insurance Policy is
prohibited by applicable law. With respect
to the Lender PMI Mortgage Loans,
the Master Servicer shall maintain the
Primary Insurance Policy for the life
of such Mortgage Loans, unless otherwise
provided for in the related Mortgage
Note or prohibited by law.
The Master
Servicer agrees to effect the timely payment of the premiums
on each Primary Insurance Policy, and such
costs not otherwise recoverable
shall be recoverable by the Master Servicer
from the related liquidation
proceeds and Subsequent Recoveries.
(c) In
connection with its activities as Master Servicer of the
Mortgage
Loans, the Master Servicer agrees to
present on behalf of itself, the Trustee
and Certificateholders, claims to the
insurer under any Primary Insurance
Policies and, in this regard, to take such
reasonable action as shall be
necessary to permit recovery under any
Primary Insurance Policies respecting
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defaulted Mortgage Loans. Any amounts
collected by the Master Servicer under
any Primary Insurance Policies shall be
deposited in the Certificate Account.
SECTION 3.10.
Enforcement of Due-on-Sale Clauses; Assumption Agreements.
(a) Except as
otherwise provided in this Section, when any property
subject to a Mortgage has been conveyed by
the Mortgagor, the Master Servicer
shall to the extent that it has knowledge
of such conveyance, enforce any
due-on-sale clause contained in any
Mortgage Note or Mortgage, to the extent
permitted under applicable law and
governmental regulations, but only to the
extent that such enforcement will not
adversely affect or jeopardize coverage
under any Required Insurance Policy.
Notwithstanding the foregoing, the Master
Servicer is not required to exercise such
rights with respect to a Mortgage
Loan if the Person to whom the related
Mortgaged Property has been conveyed or
is proposed to be conveyed satisfies the
terms and conditions contained in the
Mortgage Note and Mortgage related thereto
and the consent of the mortgagee
under such Mortgage Note or Mortgage is not
otherwise so required under such
Mortgage Note or Mortgage as a condition to
such transfer. In the event that
the Master Servicer is prohibited by law
from enforcing any such due-on-sale
clause, or if coverage under any Required
Insurance Policy would be adversely
affected, or if nonenforcement is otherwise
permitted hereunder, the Master
Servicer is authorized, subject to Section
3.10(b), to take or enter into an
assumption and modification agreement from
or with the person to whom such
property has been or is about to be
conveyed, pursuant to which such person
becomes liable under the Mortgage Note and,
unless prohibited by applicable
state law, the Mortgagor remains liable
thereon, provided that the Mortgage
Loan shall continue to be covered (if so
covered before the Master Servicer
enters such agreement) by the applicable
Required Insurance Policies. The
Master Servicer, subject to Section
3.10(b), is also authorized with the prior
approval of the insurers under any Required
Insurance Policies to enter into a
substitution of liability agreement with
such Person, pursuant to which the
original Mortgagor is released from
liability and such Person is substituted
as Mortgagor and becomes liable under the
Mortgage Note. Notwithstanding the
foregoing, the Master Servicer shall not be
deemed to be in default under this
Section by reason of any transfer or
assumption which the Master Servicer
reasonably believes it is restricted by law
from preventing, for any reason
whatsoever.
(b) Subject to
the Master Servicer's duty to enforce any due-on-sale
clause to the extent set forth in Section
3.10(a) hereof, in any case in which
a Mortgaged Property has been conveyed to a
Person by a Mortgagor, and such
Person is to enter into an assumption
agreement or modification agreement or
supplement to the Mortgage Note or Mortgage
that requires the signature of the
Trustee, or if an instrument of release
signed by the Trustee is required
releasing the Mortgagor from liability on
the Mortgage Loan, the Master
Servicer shall prepare and deliver or cause
to be prepared and delivered to
the Trustee for signature and shall direct,
in writing, the Trustee to execute
the assumption agreement with the Person to
whom the Mortgaged Property is to
be conveyed and such modification agreement
or supplement to the Mortgage Note
or Mortgage or other instruments as are
reasonable or necessary to carry out
the terms of the Mortgage Note or Mortgage
or otherwise to comply with any
applicable laws regarding assumptions or
the transfer of the Mortgaged
Property to such Person. In connection with
any such assumption, no material
term of the Mortgage Note may be changed.
In addition, the substitute
Mortgagor and the Mortgaged Property must
be acceptable to the Master Servicer
in accordance with its underwriting
standards as then in effect. Together with
each such
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substitution, assumption or other agreement
or instrument delivered to the
Trustee for execution by it, the Master
Servicer shall deliver an Officer's
Certificate signed by a Servicing Officer
stating that the requirements of
this subsection have been met in connection
therewith. The Master Servicer
shall notify the Trustee that any such
substitution or assumption agreement
has been completed by forwarding to the
Trustee the original of such
substitution or assumption agreement, which
in the case of the original shall
be added to the related Mortgage File and
shall, for all purposes, be
considered a part of such Mortgage File to
the same extent as all other
documents and instruments constituting a
part thereof. Any fee collected by
the Master Servicer for entering into an
assumption or substitution of
liability agreement will be retained by the
Master Servicer as additional
servicing compensation.
SECTION 3.11.
Realization Upon Defaulted Mortgage Loans; Repurchase of
Certain Mortgage Loans.
(a) The Master
Servicer shall use reasonable efforts to foreclose upon or
otherwise comparably convert the ownership
of properties securing such of the
Mortgage Loans as come into and continue in
default and as to which no
satisfactory arrangements can be made for
collection of delinquent payments.
In connection with such foreclosure or
other conversion, the Master Servicer
shall follow such practices and procedures
as it shall deem necessary or
advisable and as shall be normal and usual
in its general mortgage servicing
activities and meet the requirements of the
insurer under any Required
Insurance Policy; provided, however, that
the Master Servicer shall not be
required to expend its own funds in
connection with any foreclosure or towards
the restoration of any property unless it
shall determine (i) that such
restoration and/or foreclosure will
increase the proceeds of liquidation of
the Mortgage Loan after reimbursement to
itself of such expenses and (ii) that
such expenses will be recoverable to it
through Liquidation Proceeds
(respecting which it shall have priority
for purposes of withdrawals from the
Certificate Account). The Master Servicer
shall be responsible for all other
costs and expenses incurred by it in any
such proceedings; provided, however,
that it shall be entitled to reimbursement
thereof from the liquidation
proceeds and Subsequent Recoveries with
respect to the related Mortgaged
Property, as provided in the definition of
Liquidation Proceeds. If the Master
Servicer has knowledge that a Mortgaged
Property which the Master Servicer is
contemplating acquiring in foreclosure or
by deed in lieu of foreclosure is
located within a 1 mile radius of any site
listed in the Expenditure Plan for
the Hazardous Substance Clean Up Bond Act
of 1984 or other site with
environmental or hazardous waste risks
known to the Master Servicer, the
Master Servicer will, prior to acquiring
the Mortgaged Property, consider such
risks and only take action in accordance
with its established environmental
review procedures.
With respect to
any REO Property, the deed or certificate of sale shall
be taken in the name of the Trustee for the
benefit of the Certificateholders,
or its nominee, on behalf of the
Certificateholders. The Trustee's name shall
be placed on the title to such REO Property
solely as the Trustee hereunder
and not in its individual capacity. The
Master Servicer shall ensure that the
title to such REO Property references the
Pooling and Servicing Agreement and
the Trustee's capacity thereunder. Pursuant
to its efforts to sell such REO
Property, the Master Servicer shall either
itself or through an agent selected
by the Master Servicer protect and conserve
such REO Property in the same
manner and to such extent as is customary
in the locality where such REO
Property is located and may, incident to
its conservation and protection of
the interests of the Certificateholders,
rent the same, or any part thereof,
as the Master Servicer deems to be in
the
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best interest of the Certificateholders for
the period prior to the sale of
such REO Property. The Master Servicer
shall prepare for and deliver to the
Trustee a statement with respect to each
REO Property that has been rented
showing the aggregate rental income
received and all expenses incurred in
connection with the maintenance of such REO
Property at such times as is
necessary to enable the Trustee to comply
with the reporting requirements of
the REMIC Provisions. The net monthly
rental income, if any, from such REO
Property shall be deposited in the
Certificate Account no later than the close
of business on each Determination Date. The
Master Servicer shall perform the
tax reporting and withholding required by
Sections 1445 and 6050J of the Code
with respect to foreclosures and
abandonments, the tax reporting required by
Section 6050H of the Code with respect to
the receipt of mortgage interest
from individuals and any tax reporting
required by Section 6050P of the Code
with respect to the cancellation of
indebtedness by certain financial
entities, by preparing such tax and
information returns as may be required, in
the form required, and delivering the same
to the Trustee for filing.
In the event
that the Trust Fund acquires any Mortgaged Property as
aforesaid or otherwise in connection with a
default or imminent default on a
Mortgage Loan, the Master Servicer shall
dispose of such Mortgaged Property as
soon as practicable in a manner that
maximizes the Liquidation Proceeds
thereof, but in no event later than three
years after its acquisition by the
Trust Fund. In that event, the Trustee
shall have been supplied with an
Opinion of Counsel to the effect that the
holding by the Trust Fund of such
Mortgaged Property subsequent to a
three-year period, if applicable, will not
result in the imposition of taxes on
"prohibited transactions" of any REMIC
hereunder as defined in section 860F of the
Code or cause any REMIC hereunder
to fail to qualify as a REMIC at any time
that any Certificates are
outstanding, the Trust Fund may continue to
hold such Mortgaged Property
(subject to any conditions contained in
such Opinion of Counsel) after the
expiration of such three-year period.
Notwithstanding any other provision of
this Agreement, no Mortgaged Property
acquired by the Trust Fund shall be
rented (or allowed to continue to be
rented) or otherwise used for the
production of income by or on behalf of the
Trust Fund in such a manner or
pursuant to any terms that would (i) cause
such Mortgaged Property to fail to
qualify as "foreclosure property" within
the meaning of section 860G(a)(8) of
the Code or (ii) subject any REMIC he
