<PAGE>
EXECUTION VERSION
CHASE MORTGAGE FINANCE CORPORATION,
DEPOSITOR,
JPMORGAN CHASE BANK, N.A.,
SERVICER
AND
WACHOVIA BANK, N.A.,
TRUSTEE
POOLING AND SERVICING AGREEMENT
Dated as of October 1, 2005
$764,521,120.85
Chase Mortgage Finance Trust
Multi-Class Mortgage Pass-Through Certificates
Series
2005-S3
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ARTICLE I
DEFINITIONS................................................................................1
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; TRUST
FUND..................................................37
Section 2.01
Conveyance of Mortgage
Loans.....................................................37
Section 2.02
Acceptance by
Trustee............................................................41
Section 2.03
Trust Fund; Authentication of
Certificates.......................................42
Section 2.04 REMIC
Elections..................................................................42
Section 2.05
Permitted Activities of
Trust....................................................44
Section 2.06
Qualifying Special Purpose
Entity................................................44
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR AND THE SERVICER;
REPURCHASE OF
MORTGAGE
LOANS............................................................................44
Section 3.01
Representations and Warranties of the Depositor with respect to
the
Mortgage
Loans...................................................................44
Section 3.02
Representations and Warranties of the
Servicer...................................52
Section 3.03
Option to
Substitute.............................................................52
ARTICLE IV
THE
CERTIFICATES..........................................................................53
Section 4.01
The
Certificates.................................................................53
Section 4.02
Registration of Transfer and Exchange of
Certificates............................56
Section 4.03
Mutilated, Destroyed, Lost or Stolen
Certificates................................59
Section 4.04
Persons Deemed
Owners............................................................60
Section 4.05
Appointment of Paying Agent, Certificate Registrar and Backup
Advancer;
Certificate
Account..............................................................60
Section
4.06
Authenticating
Agents............................................................61
ARTICLE V
ADMINISTRATION AND SERVICING OF MORTGAGE
LOANS............................................62
Section 5.01
Servicer to Service
Mortgage Loans...............................................62
Section 5.02
Sub-Servicing Agreements Between Servicer and Sub-Servicers;
Enforcement
of Sub-Servicer's
Obligations....................................................63
Section 5.03
Successor
Sub-Servicers..........................................................63
Section 5.04
Liability of the
Servicer........................................................63
Section 5.05
No Contractual Relationship Between Sub-Servicer and Trustee or
Certificateholders...............................................................64
Section 5.06
Termination of Sub-Servicing
Agreement...........................................64
Section 5.07
Collection of Mortgage Loan
Payments.............................................64
Section 5.08
Establishment of Collection Account; Deposit in Collection
Account...............64
Section 5.09
Permitted Withdrawals from the Collection
Account................................65
Section 5.10
Establishment of Escrow Account; Deposits in Escrow
Account......................66
Section 5.11
Permitted Withdrawals from Escrow
Account........................................66
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Section 5.12
Payment of Taxes, Insurance and Other
Charges....................................67
Section 5.13
Transfer of
Accounts.............................................................67
Section 5.14
[Reserved].......................................................................67
Section 5.15
Maintenance of the Primary Insurance
Policies....................................67
Section 5.16
Maintenance of Standard Hazard
Policies..........................................67
Section 5.17
[Reserved].......................................................................68
Section 5.18
[Reserved].......................................................................68
Section 5.19
Fidelity Bond and Errors and Omissions
Insurance.................................68
Section 5.20
Collections under Insurance Policies; Enforcement of Due-On-Sale
Clauses;
Assumption
Agreements............................................................69
Section 5.21
Income and Realization from Defaulted Mortgage
Loans.............................69
Section 5.22
Trustee to Cooperate; Release of Mortgage
Files..................................71
Section 5.23
Servicing and Other
Compensation.................................................72
Section 5.24
1934 Act
Reports.................................................................72
Section 5.25
Annual Statement as to
Compliance................................................73
Section 5.26
Annual Independent Public Accountants' Servicing
Report..........................73
Section 5.27
Access to Certain Documentation; Rights of the Depositor in Respect
of
the
Servicer.....................................................................73
Section 5.28
REMIC-Related
Covenants..........................................................74
ARTICLE VI
PAYMENTS TO THE
CERTIFICATEHOLDERS........................................................75
Section 6.01
Distributions....................................................................75
Section 6.02
Statements to the
Certificateholders.............................................80
Section 6.03
Advances by the
Servicer.........................................................82
Section 6.04
Allocation of Realized
Losses....................................................82
Section 6.05
Compensating Interest; Allocation of Certain Interest
Shortfalls.................83
Section 6.06
Subordination....................................................................84
Section 6.07
[Reserved].......................................................................85
ARTICLE VII
REPORTS TO BE PREPARED BY THE
SERVICER....................................................85
Section 7.01
Servicer Shall Provide Information as Reasonably
Required........................85
Section 7.02
Federal Information Returns and Reports to
Certificateholders....................85
ARTICLE VIII
THE DEPOSITOR AND THE
SERVICER............................................................86
Section 8.01
Indemnification; Third Party
Claims..............................................86
Section 8.02
Merger or Consolidation of the Depositor or the
Servicer.........................86
Section 8.03
Limitation on Liability of the Depositor, the Servicer, the Trustee
and
Others...........................................................................87
Section 8.04
Depositor and Servicer Not to
Resign.............................................88
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Section 8.05
Successor to the
Servicer........................................................88
Section 8.06
Maintenance of
Ratings...........................................................89
ARTICLE IX
DEFAULT...................................................................................89
Section 9.01
Events of
Default................................................................89
Section 9.02
Waiver of
Defaults...............................................................90
Section 9.03
Trustee to Act; Appointment of
Successor.........................................90
Section 9.04
Notification to Certificateholders and the Rating
Agencies.......................90
ARTICLE X
CONCERNING THE
TRUSTEE....................................................................91
Section 10.01
Duties of
Trustee................................................................91
Section 10.02
Certain Matters Affecting the
Trustee............................................92
Section 10.03
Trustee Not Liable for Certificates or Mortgage
Loans............................92
Section 10.04
Trustee May Own
Certificates.....................................................93
Section 10.05
Fees and
Expenses................................................................93
Section 10.06
Eligibility Requirements for
Trustee.............................................93
Section 10.07
Resignation and Removal of the
Trustee...........................................93
Section 10.08
Successor
Trustee................................................................94
Section 10.09
Merger or Consolidation of
Trustee...............................................95
Section 10.10
Appointment of Co-Trustee or Separate
Trustee....................................95
Section 10.11
Appointment of Office or
Agency..................................................95
ARTICLE XI
TERMINATION...............................................................................96
Section 11.01
Termination......................................................................96
ARTICLE XII
MISCELLANEOUS
PROVISIONS..................................................................97
Section 12.01
Severability of
Provisions.......................................................97
Section 12.02
Limitation on Rights of
Certificateholders.......................................97
Section 12.03
Amendment........................................................................98
Section 12.04
Counterparts.....................................................................99
Section 12.05
Duration of
Agreement............................................................99
Section 12.06
Governing
Law....................................................................99
Section 12.07
Notices..........................................................................99
Section 12.08
Further
Assurances...............................................................99
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EXHIBIT A
MORTGAGE LOAN SCHEDULE
EXHIBIT B
CONTENTS OF MORTGAGE FILE
EXHIBIT C
FORMS OF CLASS A CERTIFICATES
EXHIBIT D FORM
OF CLASS M CERTIFICATE
EXHIBIT E
FORMS OF CLASS B CERTIFICATES
EXHIBIT F FORM
OF CLASS A-R CERTIFICATE
EXHIBIT G FORM
OF TRUSTEE CERTIFICATION
EXHIBIT H FORM
OF INVESTMENT LETTER
EXHIBIT I FORM
OF RULE 144A INVESTMENT LETTER
EXHIBIT J FORM
OF SPECIAL SERVICING AND COLLATERAL FUND AGREEMENT
EXHIBIT K FORM
OF CLASS A-R TRANSFEREE LETTER
EXHIBIT K-1 FORM OF CLASS
A-R TRANSFEROR LETTER
EXHIBIT L
REQUEST FOR RELEASE OF DOCUMENTS
EXHIBIT M FORM
OF ERISA REPRESENTATION LETTER
EXHIBIT N FORM
OF OFFICER'S CERTIFICATE (SERVICER)
EXHIBIT O FORM
OF OFFICER'S CERTIFICATE (PAYING AGENT)
EXHIBIT P
LETTER OF REPRESENTATIONS
iv
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This Pooling and Servicing Agreement, dated as of October 1, 2005,
is
executed among Chase Mortgage Finance
Corporation, as depositor (together with
its permitted successors and assigns, the
"Depositor"), JPMorgan Chase Bank,
N.A. ("Chase"), as servicer (together with
its permitted successors and assigns,
the "Servicer") and Wachovia Bank, N.A., as
trustee (together with its permitted
successors and assigns, the "Trustee").
In consideration of the premises and the mutual agreements
hereinafter
set forth, the Depositor, the Servicer and
the Trustee agree as follows:
ARTICLE I
DEFINITIONS
Whenever used herein, the following words and phrases, unless
the
context otherwise requires, shall have the
following meanings:
ACCEPTED SERVICING PRACTICES: With respect to any Mortgage Loan,
those
mortgage servicing practices (including
collection procedures) of prudent
mortgage banking institutions which service
mortgage loans of the same type as
such Mortgage Loan in the jurisdiction
where the related Mortgaged Property (or
Underlying Mortgaged Property, in the case
of a Co-op Loan) is located, and
which are in accordance with FNMA servicing
practices and procedures for MBS
pool mortgages (as defined in the FNMA
Guides including future updates).
ADVANCE: The aggregate of the advances made by the Servicer
with
respect to a particular Distribution Date
pursuant to Section 6.03.
AFFILIATE: With respect to any specified Person, any other
Person
controlling, controlled by or under common
control with such Person. For the
purposes of this definition, "control"
means the power to direct the management
and policies of a Person, directly or
indirectly, whether through ownership of
voting securities, by contract or
otherwise; and the terms "controlling" and
"controlled" have meanings correlative to
the foregoing.
AGENCY & TRUST OFFICE: The principal office of the Trustee at
which at
any particular time its corporate trust
business shall be administered, which
office at the date of execution of this
instrument is located at 401 South Tryon
Street, 12th Floor NC1179, Charlotte, North
Carolina 28288-1179.
AGGREGATE CLASS A INTEREST ACCRUAL AMOUNT: On any Distribution
Date, an
amount equal to the sum of the Class A-1
Interest Accrual Amount, the Class A-2
Interest Accrual Amount, the Class A-3
Interest Accrual Amount, the Class A-4
Interest Accrual Amount, the Class A-5
Interest Accrual Amount, the Class A-6
Interest Accrual Amount, the Class A-7
Interest Accrual Amount, the Class A-8
Interest Accrual Amount, the Class A-9
Interest Accrual Amount, the Class A-10
Interest Accrual Amount, the Class A-11
Interest Accrual Amount, the Class A-12
Interest Accrual Amount, the Class A-13
Interest Accrual Amount, the Class A-14
Interest Accrual Amount, the Class A-15
Interest Accrual Amount, the Class A-X
Interest Accrual Amount and the Class A-R
Interest Accrual Amount.
AGGREGATE CLASS A INTEREST SHORTFALL: On any Distribution Date,
an
amount equal to the sum of the Class A-1
Shortfall, the Class A-2 Shortfall, the
Class A-3 Shortfall, the Class A-4
Shortfall, the Class A-5 Shortfall, the Class
A-6 Shortfall, the Class A-7 Shortfall, the
Class A-8 Shortfall, the Class A-9
Shortfall, the Class A-10 Shortfall, the
Class A-11 Shortfall, the Class A-12
Shortfall, the Class A-13 Shortfall, the
Class A-14 Shortfall, the Class A-15
Shortfall, the Class A-X Shortfall and the
Class A-R Shortfall.
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AGREEMENT: This Pooling and Servicing Agreement and all
amendments
hereof and supplements hereto.
APPRAISED VALUE: The value set forth in an appraisal or
recertification
document made in connection with the
origination of the related Mortgage Loan as
the value of the Mortgaged Property (or the
related residential dwelling unit in
the Underlying Mortgaged Property, in the
case of a Co-op Loan).
ASSIGNMENT OF MORTGAGE: An assignment of the Mortgage, notice
of
transfer (or UCC-3 assignment (or
equivalent instrument) with respect to each
Co-op Loan) or equivalent instrument, in
recordable form (except in the case of
a Co-op Loan), sufficient under the laws of
the jurisdiction where the related
Mortgaged Property (or Underlying Mortgaged
Property, in the case of a Co-op
Loan) is located to reflect of record the
sale and assignment of the Mortgage
Loan to the Trustee, which assignment,
notice of transfer or equivalent
instrument may, if permitted by law, be in
the form of one or more blanket
assignments covering Mortgages secured by
Mortgaged Properties located in the
same county.
AUTHENTICATING AGENT: The meaning specified in Section 4.06.
AVAILABLE DISTRIBUTION AMOUNT: On any Distribution Date, an
amount
equal to the amount on deposit in the
Collection Account as of the close of
business two Business Days immediately
preceding the related Distribution Date
(but prior to making any deposits into the
Certificate Account on such date)
except:
(a) amounts received on particular Mortgage Loans as late payments
or
other recoveries of principal or interest
(including any Subsequent Recoveries,
Liquidation Proceeds, Insurance Proceeds
and condemnation awards) and respecting
which the Servicer previously made an
unreimbursed Advance of such amounts;
(b) reimbursement for Nonrecoverable Advances and other amounts
permitted to be withdrawn by the Servicer
pursuant to Section 5.09 from, or not
required to be deposited in, the Collection
Account;
(c) amounts representing the Servicing Fee with respect to such
Distribution Date;
(d) amounts representing all or part of a Monthly Payment due (i)
after
the related Due Period or (ii) on or prior
to the Cut-off Date;
(e) all Repurchase Proceeds, Principal Prepayments, Liquidation
Proceeds, Insurance Proceeds, Subsequent
Recoveries and condemnation awards with
respect to Mortgage Loans received after
the related Principal Prepayment
Period, and all related payments of
interest representing interest for any
period of time after the last day of the
related Due Period for such Mortgage
Loans; and
(f) all income from Eligible Investments held in the Collection
Account
for the account of the Servicer.
BACKUP ADVANCER: Initially, the Paying Agent acting with respect to
the
obligation to make Advances under certain
circumstances as set forth in Section
6.03.
BANKRUPTCY
AMOUNT: As of any date of determination, $100,000.00 minus
all Bankruptcy Losses on the Mortgage
Loans, if any, previously allocated to the
Certificates in accordance with Section
6.04.
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BANKRUPTCY
CODE: Title 11 of the United States Code, as the same may be
amended from time to time.
BANKRUPTCY LOSS: With respect to any Mortgage Loan, a Realized
Loss
resulting from a Deficient Valuation or
Debt Service Reduction.
BENEFICIAL HOLDER: A Person holding a beneficial interest in
any
Book-Entry Certificate through a
Participant or an Indirect Participant or a
Person holding a beneficial interest in any
Definitive Certificate.
BOOK-ENTRY CERTIFICATES: The Class A Certificates (other than the
Class
A-R and Class A-X Certificates), Class M
Certificates, Class B-1 Certificates
and Class B-2 Certificates, referred to
collectively.
BUSINESS DAY: Any day other than (a) a Saturday or Sunday, (b) a
legal
holiday in the State of New York or (c) a
day on which banking institutions in
the State of New York are authorized or
obligated by law or executive order to
be closed.
CARRY-OVER SUBORDINATED PRINCIPAL AMOUNT: As of any Distribution
Date,
with respect to any Class of Subordinated
Certificates, an amount, if any, equal
to the amount of principal distributable to
such Class on any prior Distribution
Date that has not been so distributed and
is not attributable to a Realized
Loss.
CASH LIQUIDATION: Recovery of all cash proceeds by the Servicer
with
respect to the liquidation of any Mortgage
Loan, including Insurance Proceeds
and other payments or recoveries (whether
made at one time or over a period of
time) which the Servicer deems to be
finally recoverable, in connection with the
sale, assignment or satisfaction of such
Mortgage Loan, trustee's sale,
foreclosure sale or otherwise, but only if
title to the related Mortgaged
Property (or stock allocated to a dwelling
unit, in the case of a Co-op Loan)
was not acquired by foreclosure or deed in
lieu of foreclosure by the Servicer
pursuant to Section 5.21.
CERTIFICATE: Any Class A, Class M or Class B Certificate.
CERTIFICATE ACCOUNT: The account created and maintained pursuant
to
Section 4.05.
CERTIFICATEHOLDER or HOLDER: The Person in whose name a Certificate
is
registered in the Certificate Register,
except that, solely for the purposes of
giving any consent, waiver, request or
demand pursuant to this Agreement, any
Certificate registered in the name of the
Depositor, the Servicer, any
Sub-Servicer, or any of their respective
Affiliates shall be disregarded and the
undivided Percentage Interest evidenced
thereby shall not be taken into account
in determining whether the requisite amount
of Percentage Interests necessary to
effect any such consent, waiver, request or
demand has been obtained. The
Trustee and the Paying Agent shall be
entitled to conclusively rely upon the
certificate of the Depositor or the
Servicer as to the determination of which
Certificates are registered in the name of
such Affiliates.
CERTIFICATE OWNER: Any Person who is the beneficial owner of a
Book-Entry Certificate registered in the
name of the Depository or its nominee.
CERTIFICATE RATE: The per annum rate of interest borne by each
Class
of Certificates (other than the Class A-P
Certificates), which rate shall equal
5.50%. Interest with respect to each Class
of Certificates (other than the Class
A-P Certificates) shall be calculated based
on a 360 day year comprised of
twelve 30-day months.
3
<PAGE>
CERTIFICATE REGISTER: The register maintained pursuant to Section
4.02.
CERTIFICATE REGISTRAR: The Person appointed by the Trustee as
Certificate Registrar pursuant to Section
4.05.
CHASE: JPMorgan Chase Bank, N.A., a national banking association,
or
its successor in interest.
CHF: Chase Home Finance LLC, a Delaware limited liability company,
or
its successor in interest.
CLASS: Pertaining to the Class A-1, Class A-2, Class A-3, Class
A-4,
Class A-5, Class A-6, Class A-7, Class A-8,
Class A-9, Class A-10, Class A-11,
Class A-12, Class A-13, Class A-14, Class
A-15, Class A-X, Class A-P, Class A-R,
Class M, Class B-1, Class B-2, Class B-3,
Class B-4, Class B-5 Certificates or
any Lower-Tier REMIC Interest, as the case
may be.
CLASS A-1 CERTIFICATE: Any one of the Class A-1 Certificates,
executed
by the Depositor and authenticated by the
Trustee, senior in right of payment to
the Class M and Class B Certificates,
substantially in the form of the Class A
Certificate set forth in Exhibit C
hereto.
CLASS A-1 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
A-1 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class A-1 Certificates on such
Distribution Date pursuant to Section
6.05(b), (ii) any Realized Loss Interest
Shortfall resulting from an Excess Loss
allocated to the Class A-1 Certificates
on such Distribution Date pursuant to
Section 6.05(c), and (iii) any interest
shortfall resulting from the Relief Act
allocated to the Class A-1 Certificates
on such Distribution Date pursuant to
Section 6.05(d).
CLASS A-1 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-1 Interest Accrual Amount over the
amount actually distributed to the Class
A-1 Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(A).
CLASS A-1/A-2 LOCKOUT PERCENTAGE: With respect to any Distribution
Date
through October 2010, 0% and for any
Distribution Date thereafter, the lesser of
(i) the product of (a) the quotient of (I)
the aggregate Outstanding Certificate
Principal Balance of the Class A-1 and
Class A-2 Certificates and (II) the
aggregate Outstanding Certificate Principal
Balance of the Non-PO Class A
Certificates (not including the Class A-R
Certificate), in each case immediately
prior to such Distribution Date and (b) the
Step Down Percentage, and (ii)
100.00%.
CLASS A-1/A-2 LOCKOUT PRINCIPAL DISTRIBUTION AMOUNT: With respect
to
any Distribution Date will equal the
product of the Class A-1/A-2 Lockout
Percentage and the amount with respect to
the Mortgage Loans which is referred
to in clauses (i), (ii), (iii), (iv) and
(v) of the definition of Non-PO Class A
Optimal Principal AMOUNT.
CLASS A-2 CERTIFICATE: Any one of the Class A-2 Certificates,
executed
by the Depositor and authenticated by the
Trustee, senior in right of payment to
the Class M and Class B Certificates,
substantially in the form of the Class A
Certificate set forth in Exhibit C
hereto.
4
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CLASS A-2 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
A-2 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class A-2 Certificates on such
Distribution Date pursuant to Section
6.05(b), (ii) any Realized Loss Interest
Shortfall resulting from an Excess Loss
allocated to the Class A-2 Certificates
on such Distribution Date pursuant to
Section 6.05(c), and (iii) any interest
shortfall resulting from the Relief Act
allocated to the Class A-2 Certificates
on such Distribution Date pursuant to
Section 6.05(d).
CLASS A-2 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-2 Interest Accrual Amount over the
amount actually distributed to the Class
A-2 Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(B).
CLASS A-3 CERTIFICATE: Any one of the Class A-3 Certificates,
executed
by the Depositor and authenticated by the
Trustee, senior in right of payment to
the Class M and Class B Certificates,
substantially in the form of the Class A
Certificate set forth in Exhibit C
hereto.
CLASS A-3 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
A-3 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class A-3 Certificates on such
Distribution Date pursuant to Section
6.05(b), (ii) any Realized Loss Interest
Shortfall resulting from an Excess Loss
allocated to the Class A-3 Certificates
on such Distribution Date pursuant to
Section 6.05(c), and (iii) any interest
shortfall resulting from the Relief Act
allocated to the Class A-3 Certificates
on such Distribution Date pursuant to
Section 6.05(d).
CLASS A-3 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-3 Interest Accrual Amount over the
amount actually distributed to the Class
A-3 Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(C).
CLASS A-4 CERTIFICATE: Any one of the Class A-4 Certificates,
executed
by the Depositor and authenticated by the
Trustee, senior in right of payment to
the Class M and Class B Certificates,
substantially in the form of the Class A
Certificate set forth in Exhibit C
hereto.
CLASS A-4 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
A-4 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class A-4 Certificates on such
Distribution Date pursuant to Section
6.05(b), (ii) any Realized Loss Interest
Shortfall resulting from an Excess Loss
allocated to the Class A-4 Certificates
on such Distribution Date pursuant to
Section 6.05(c), and (iii) any interest
shortfall resulting from the Relief Act
allocated to the Class A-4 Certificates
on such Distribution Date pursuant to
Section 6.05(d).
CLASS A-4 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-4 Interest Accrual Amount over the
amount actually distributed to the Class
A-4 Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(D).
CLASS A-5 CERTIFICATE: Any one of the Class A-5 Certificates,
executed
by the Depositor and authenticated by the
Trustee, senior in right of payment to
the Class M and Class B Certificates,
substantially in the form of the Class A
Certificate set forth in Exhibit C
hereto.
CLASS A-5 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
A-5 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class A-5 Certificates on such
Distribution Date pursuant to Section
6.05(b), (ii) any Realized Loss Interest
Shortfall resulting from an Excess Loss
allocated to the Class A-5 Certificates
on such Distribution Date pursuant to
Section 6.05(c), and (iii) any interest
shortfall resulting from the Relief Act
allocated to the Class A-5 Certificates
on such Distribution Date pursuant to
Section 6.05(d).
5
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CLASS A-5 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-5 Interest Accrual Amount over the
amount actually distributed to the Class
A-5 Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(E).
CLASS A-6 CERTIFICATE: Any one of the Class A-6 Certificates,
executed
by the Depositor and authenticated by the
Trustee, senior in right of payment to
the Class M and Class B Certificates,
substantially in the form of the Class A
Certificate set forth in Exhibit C
hereto.
CLASS A-6 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
A-6 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class A-6 Certificates on such
Distribution Date pursuant to Section
6.05(b), (ii) any Realized Loss Interest
Shortfall resulting from an Excess Loss
allocated to the Class A-6 Certificates
on such Distribution Date pursuant to
Section 6.05(c), and (iii) any interest
shortfall resulting from the Relief Act
allocated to the Class A-6 Certificates
on such Distribution Date pursuant to
Section 6.05(d).
CLASS A-6 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-6 Interest Accrual Amount over the
amount actually distributed to the Class
A-6 Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(F).
CLASS A-7 CERTIFICATE: Any one of the Class A-7 Certificates,
executed
by the Depositor and authenticated by the
Trustee, senior in right of payment to
the Class M and Class B Certificates,
substantially in the form of the Class A
Certificate set forth in Exhibit C
hereto.
CLASS A-7 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
A-7 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class A-7 Certificates on such
Distribution Date pursuant to Section
6.05(b), (ii) any Realized Loss Interest
Shortfall resulting from an Excess Loss
allocated to the Class A-7 Certificates
on such Distribution Date pursuant to
Section 6.05(c), and (iii) any interest
shortfall resulting from the Relief Act
allocated to the Class A-7 Certificates
on such Distribution Date pursuant to
Section 6.05(d).
CLASS A-7 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-7 Interest Accrual Amount over the
amount actually distributed to the Class
A-7 Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(G).
CLASS A-8 CERTIFICATE: Any one of the Class A-8 Certificates,
executed
by the Depositor and authenticated by the
Trustee, senior in right of payment to
the Class M and Class B Certificates,
substantially in the form of the Class A
Certificate set forth in Exhibit C
hereto.
CLASS A-8 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
A-8 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class A-8 Certificates on such
Distribution Date pursuant to Section
6.05(b), (ii) any Realized Loss Interest
Shortfall resulting from an Excess Loss
allocated to the Class A-8 Certificates
on such Distribution Date pursuant to
Section 6.05(c), and (iii) any interest
shortfall resulting from the Relief Act
allocated to the Class A-8 Certificates
on such Distribution Date pursuant to
Section 6.05(d).
CLASS A-8 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-8 Interest Accrual Amount over the
amount actually distributed to the Class
A-8 Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(H).
6
<PAGE>
CLASS A-9 CERTIFICATE: Any one of the Class A-9 Certificates,
executed
by the Depositor and authenticated by the
Trustee, senior in right of payment to
the Class M and Class B Certificates,
substantially in the form of the Class A
Certificate set forth in Exhibit C
hereto.
CLASS A-9 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
A-9 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class A-9 Certificates on such
Distribution Date pursuant to Section
6.05(b), (ii) any Realized Loss Interest
Shortfall resulting from an Excess Loss
allocated to the Class A-9 Certificates
on such Distribution Date pursuant to
Section 6.05(c), and (iii) any interest
shortfall resulting from the Relief Act
allocated to the Class A-9 Certificates
on such Distribution Date pursuant to
Section 6.05(d).
CLASS A-9 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-9 Interest Accrual Amount over the
amount actually distributed to the Class
A-9 Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(I).
CLASS A-10 CERTIFICATE: Any one of the Class A-10 Certificates,
executed by the Depositor and authenticated
by the Trustee, senior in right of
payment to the Class M and Class B
Certificates, substantially in the form of
the Class A Certificate set forth in
Exhibit C hereto.
CLASS A-10 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
A-10 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class A-10 Certificates on such
Distribution Date pursuant to Section
6.05(b), (ii) any Realized Loss Interest
Shortfall resulting from an Excess Loss
allocated to the Class A-10 Certificates
on such Distribution Date pursuant to
Section 6.05(c), and (iii) any interest
shortfall resulting from the Relief Act
allocated to the Class A-10 Certificates
on such Distribution Date pursuant to
Section 6.05(d).
CLASS A-10 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-10 Interest Accrual Amount over the
amount actually distributed to the Class
A-10 Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(J).
CLASS A-11 CERTIFICATE: Any one of the Class A-11 Certificates,
executed by the Depositor and authenticated
by the Trustee, senior in right of
payment to the Class M and Class B
Certificates, substantially in the form of
the Class A Certificate set forth in
Exhibit C hereto.
CLASS A-11 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
A-11 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class A-11 Certificates on such
Distribution Date pursuant to Section
6.05(b), (ii) any Realized Loss Interest
Shortfall resulting from an Excess Loss
allocated to the Class A-11 Certificates
on such Distribution Date pursuant to
Section 6.05(c), and (iii) any interest
shortfall resulting from the Relief Act
allocated to the Class A-11 Certificates
on such Distribution Date pursuant to
Section 6.05(d).
CLASS A-11 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-11 Interest Accrual Amount over the
amount actually distributed to the Class
A-11 Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(K).
CLASS A-12 CERTIFICATE: Any one of the Class A-12 Certificates,
executed by the Depositor and authenticated
by the Trustee, senior in right of
payment to the Class M and Class B
Certificates, substantially in the form of
the Class A Certificate set forth in
Exhibit C hereto.
7
<PAGE>
CLASS A-12 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
A-12 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class A-12 Certificates on such
Distribution Date pursuant to Section
6.05(b), (ii) any Realized Loss Interest
Shortfall resulting from an Excess Loss
allocated to the Class A-12 Certificates
on such Distribution Date pursuant to
Section 6.05(c), and (iii) any interest
shortfall resulting from the Relief Act
allocated to the Class A-12 Certificates
on such Distribution Date pursuant to
Section 6.05(d).
CLASS A-12 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-12 Interest Accrual Amount over the
amount actually distributed to the Class
A-12 Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(L).
CLASS A-13 CERTIFICATE: Any one of the Class A-13 Certificates,
executed by the Depositor and authenticated
by the Trustee, senior in right of
payment to the Class M and Class B
Certificates, substantially in the form of
the Class A Certificate set forth in
Exhibit C hereto.
CLASS A-13 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
A-13 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class A-13 Certificates on such
Distribution Date pursuant to Section
6.05(b), (ii) any Realized Loss Interest
Shortfall resulting from an Excess Loss
allocated to the Class A-13 Certificates
on such Distribution Date pursuant to
Section 6.05(c), and (iii) any interest
shortfall resulting from the Relief Act
allocated to the Class A-13 Certificates
on such Distribution Date pursuant to
Section 6.05(d).
CLASS A-13 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-13 Interest Accrual Amount over the
amount actually distributed to the Class
A-13 Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(M).
CLASS A-14 CERTIFICATE: Any one of the Class A-14 Certificates,
executed by the Depositor and authenticated
by the Trustee, senior in right of
payment to the Class M and Class B
Certificates, substantially in the form of
the Class A Certificate set forth in
Exhibit C hereto.
CLASS A-14 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
A-14 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class A-14 Certificates on such
Distribution Date pursuant to Section
6.05(b), (ii) any Realized Loss Interest
Shortfall resulting from an Excess Loss
allocated to the Class A-14 Certificates
on such Distribution Date pursuant to
Section 6.05(c), and (iii) any interest
shortfall resulting from the Relief Act
allocated to the Class A-14 Certificates
on such Distribution Date pursuant to
Section 6.05(d).
CLASS A-14 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-14 Interest Accrual Amount over the
amount actually distributed to the Class
A-14 Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(N).
CLASS A-15 ACCRETION TERMINATION DATE: The earlier to occur of (i)
the
Distribution Date following the
Distribution Date on which the aggregate
Outstanding Certificate Principal Balance
of the Class A-14 or Class A-15
Certificates has been reduced to zero and
(ii) the Distribution Date following
the Credit Support Depletion Date.
CLASS A-15 CERTIFICATE: Any one of the Class A-15 Certificates,
executed by the Depositor and authenticated
by the Trustee, senior in right of
payment to the Class M and Class B
Certificates, substantially in the form of
the Class A Certificate set forth in
Exhibit C hereto.
8
<PAGE>
CLASS A-15 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
A-15 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class A-15 Certificates on such
Distribution Date pursuant to Section
6.05(b), (ii) any Realized Loss Interest
Shortfall resulting from an Excess Loss
allocated to the Class A-15 Certificates
on such Distribution Date pursuant to
Section 6.05(c), and (iii) any interest
shortfall resulting from the Relief Act
allocated to the Class A-15 Certificates
on such Distribution Date pursuant to
Section 6.05(d).
CLASS A-15 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-15 Interest Accrual Amount over the
amount actually distributed to the Class
A-15 Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(O).
CLASS A-P AMOUNT: With respect to any Distribution Date, the
applicable PO Percentage of (i) all
principal received on or in respect of each
Discount Mortgage Loan (exclusive of any
amounts in respect of any Monthly
Payment) during the related Principal
Prepayment Period and (ii) all principal
received as part of a Monthly Payment on or
in respect of a Discount Mortgage
Loan during the related Due Period.
CLASS A-P CERTIFICATE: Any one of the Class A-P Certificates,
executed
by the Depositor and authenticated by the
Trustee, senior in right of payment to
the Class M and Class B Certificates,
substantially in the form of the Class A
Certificate set forth in Exhibit C
hereto.
CLASS A-P SHORTFALL AMOUNT: With respect to any Distribution
Date
prior to and including the Credit Support
Depletion Date, to the extent of
amounts available to pay the Subordinated
Optimal Principal Amount (without
regard to clause (b)(2) of the definition
of such term), an amount equal to the
sum of (i) the applicable PO Percentage of
the principal portion of any Realized
Loss (other than an Excess Loss) with
respect to a Discount Mortgage Loan and
(ii) the sum of amounts, if any, by which
the amounts specified in clause (i)
with respect to each prior Distribution
Date exceeded the amount actually
distributed in respect thereof on such
prior Distribution Date and not
subsequently distributed to the Class A-P
Certificateholders.
CLASS A-R CERTIFICATE: Any one of the Class A-R Certificates,
executed
by the Depositor and authenticated by the
Trustee, senior in right of payment to
the Class M and Class B Certificates,
substantially in the form of the Class A-R
Certificate set forth in Exhibit F
hereto.
CLASS A-R INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
A-R Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class A-R Certificates on such
Distribution Date pursuant to Section
6.05(b), (ii) any Realized Loss Interest
Shortfall resulting from an Excess Loss
allocated to the Class A-R Certificates
on such Distribution Date pursuant to
Section 6.05(c), and (iii) any interest
shortfall resulting from the Relief Act
allocated to the Class A-R Certificates
on such Distribution Date pursuant to
Section 6.05(d).
CLASS A-R SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
A-R Interest Accrual Amount over the
amount actually distributed to the Class
A-R Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(P).
CLASS A-X CERTIFICATE: Any one of the Class A-X Certificates,
executed
by the Depositor and authenticated by the
Trustee, senior in right of payment to
the Class M and Class B Certificates,
substantially in the form of the Class A
Certificate set forth in Exhibit C
hereto.
9
<PAGE>
CLASS A-X INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Class A-X Notional
Amount minus (i) any Compensating Interest
Shortfall allocated to the Class A-X
Certificates on such Distribution Date
pursuant to Section 6.05(b), (ii) any
Realized Loss Interest Shortfall resulting
from an Excess Loss allocated to the
Class A-X Certificates on such Distribution
Date pursuant to Section 6.05(c),
and (iii) any interest shortfall resulting
from the Relief Act, allocated to the
Class A-X Certificates on such Distribution
Date pursuant to Section 6.05(d).
CLASS A-X NOTIONAL AMOUNT: With respect to any Distribution Date,
an
amount equal to the product of (a) the
aggregate Scheduled Principal Balance of
the Non-Discount Mortgage Loans and (b) a
fraction the numerator of which is the
weighted average of the Stripped Interest
Rates of the Non-Discount Mortgage
Loans and the denominator of which is
5.50%. The Class A-X Notional Amount for
the first Distribution Date will be
$26,364,821.54.
CLASS A-X SHORTFALL: With respect to any Distribution Date the
amount
equal to the excess, if any, of the Class
A-X Interest Accrual Amount over the
amount actually distributed to the Class
A-X Certificateholders on such
Distribution Date pursuant to Section
6.01(b)(i)(Q).
CLASS A CERTIFICATES: The Class A-1, Class A-2, Class A-3, Class
A-4,
Class A-5, Class A-6, Class A-7, Class A-8,
Class A-9, Class A-10, Class A-11,
Class A-12, Class A-13, Class A-14, Class
A-15, Class A-X, Class A-P and Class
A-R Certificates, referred to
collectively.
CLASS A, CLASS M OR CLASS B: Pertaining to Class A Certificates,
Class
M Certificates or Class B Certificates, as
the case may be.
CLASS A PERCENTAGE: As of any Distribution Date, the fraction,
expressed as a percentage (which shall
never exceed 100%), the numerator of
which is the Class A Principal Balance as
of such Distribution Date and the
denominator of which is the outstanding
Principal Balance of the Mortgage Loans
as of the immediately preceding Due
Date.
CLASS A PRINCIPAL BALANCE: As of any Distribution Date, (a) the
Class
A Principal Balance for the immediately
preceding Distribution Date less
(b)amounts distributed to the Class A
Certificateholders on such preceding
Distribution Date allocable to principal
(including the principal portion of
Advances of the Servicer made pursuant to
Section 6.03 and Realized Losses
allocated to the Class A Certificates
pursuant to Section 6.04); provided that
the Class A Principal Balance on the first
Distribution Date shall be the
Original Class A Principal Balance.
CLASS B CERTIFICATES: The Class B-1, Class B-2, Class B-3, Class
B-4
and Class B-5 Certificates, referred to
collectively.
CLASS B PERCENTAGE: As of any Distribution Date, the difference
between
100% and the sum of (i) the Class A
Percentage and (ii) the Class M Percentage
for such Distribution Date.
CLASS B PRINCIPAL BALANCE: As of any Distribution Date, the excess
of
the Mortgage Pool Principal Balance
(together with the principal portion of any
Monthly Payment due but not paid with
respect to which an Advance has not been
made) over the sum of (i) the Class A
Principal Balance and (ii) the Class M
Principal Balance.
CLASS B-1 CERTIFICATE: Any one of the Class B-1 Certificates
executed
by the Depositor and authenticated by the
Trustee, subordinated in right of
payment to the Class A and Class M
Certificates, substantially in the form of
the Class B Certificate set forth in
Exhibit E hereto.
10
<PAGE>
CLASS B-1 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
B-1 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class B-1 Certificates on such
Distribution Date pursuant to Section
6.05(b), (ii) any Realized Loss Interest
Shortfall resulting from an Excess Loss
allocated to the Class B-1 Certificates
on such Distribution Date pursuant to
Section 6.05(c) and (iii) any interest
shortfall resulting from the Relief Act
allocated to the Class B-1 Certificates
on such Distribution Date pursuant to
Section 6.05(d).
CLASS B-1 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
B-1 Interest Accrual Amount over the
amount actually distributed to the Class
B-1 Certificates on such Distribution
Date pursuant to Section 6.01(d)(1) (A) and
(B).
CLASS B-2 CERTIFICATE: Any one of the Class B-2 Certificates
executed
by the Depositor and authenticated by the
Trustee, subordinated in right of
payment to the Class A, Class M and Class
B-1 Certificates, substantially in the
form of the Class B Certificate set forth
in Exhibit E hereto.
CLASS B-2 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
B-2 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class B-2 Certificates on such
Distribution Date pursuant to Section
6.05(b), (ii) any Realized Loss Interest
Shortfall resulting from an Excess Loss
allocated to the Class B-2 Certificates
on such Distribution Date pursuant to
Section 6.05(c) and (iii) any interest
shortfall resulting from the Relief Act
allocated to the Class B-2 Certificates
on such Distribution Date pursuant to
Section 6.05(d).
CLASS B-2 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
B-2 Interest Accrual Amount over the
amount actually distributed to the Class
B-2 Certificates on such Distribution
Date pursuant to Section 6.01(d)(2) (A) and
(B).
CLASS B-3 CERTIFICATE: Any one of the Class B-3 Certificates
executed
by the Depositor and authenticated by the
Trustee, subordinated in right of
payment to the Class A, Class M, Class B-1
and Class B-2 Certificates,
substantially in the form of the Class B
Certificate set forth in Exhibit E
hereto.
CLASS B-3 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
B-3 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class B-3 Certificates on such
Distribution Date pursuant to Section
6.05(b), (ii) any Realized Loss Interest
Shortfall resulting from an Excess Loss
allocated to the Class B-3 Certificates
on such Distribution Date pursuant to
Section 6.05(c) and (iii) any interest
shortfall resulting from the Relief Act
allocated to the Class B-3 Certificates
on such Distribution Date pursuant to
Section 6.05(d).
CLASS B-3 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
B-3 Interest Accrual Amount over the
amount actually distributed to the Class
B-3 Certificates on such Distribution
Date pursuant to Section 6.01(d)(3) (A) and
(B).
CLASS B-4 CERTIFICATE: Any one of the Class B-4 Certificates
executed
by the Depositor and authenticated by the
Trustee, subordinated in right of
payment to the Class A, Class M, Class B-1,
Class B-2 and Class B-3
Certificates, substantially in the form of
the Class B Certificate set forth in
Exhibit E hereto.
11
<PAGE>
CLASS B-4 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
B-4 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class B-4 Certificates on such
Distribution Date pursuant to Section
6.05(b), (ii) any Realized Loss Interest
Shortfall resulting from an Excess Loss
allocated to the Class B-4 Certificates
on such Distribution Date pursuant to
Section 6.05(c) and (iii) any interest
shortfall resulting from the Relief Act
allocated to the Class B-4 Certificates
on such Distribution Date pursuant to
Section 6.05(d).
CLASS B-4 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
B-4 Interest Accrual Amount over the
amount actually distributed to the Class
B-4 Certificates on such Distribution
Date pursuant to Section 6.01(d)(4) (A) and
(B).
CLASS B-5 CERTIFICATE: Any one of the Class B-5 Certificates
executed
by the Depositor and authenticated by the
Trustee, subordinated in right of
payment to the Class A, Class M, Class B-1,
Class B-2, Class B-3 and Class B-4
Certificates, substantially in the form of
the Class B Certificate set forth in
Exhibit E hereto.
CLASS B-5 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the
Certificate Rate on the Outstanding
Certificate Principal Balance of the Class
B-5 Certificates minus (i) any
Compensating Interest Shortfall allocated
to the Class B-5 Certificates on such
Distribution Date pursuant to Section
6.05(b), (ii) any Realized Loss Interest
Shortfall resulting from an Excess Loss
allocated to the Class B-5 Certificates
on such Distribution Date pursuant to
Section 6.05(c) and (iii) any interest
shortfall resulting from the Relief Act
allocated to the Class B-5 Certificates
on such Distribution Date pursuant to
Section 6.05(d).
CLASS B-5 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class
B-5 Interest Accrual Amount over the
amount actually distributed to the Class
B-5 Certificates on such Distribution
Date pursuant to Section 6.01(d)(5) (A) and
(B).
CLASS M CERTIFICATE: Any one of the Class M Certificates executed
by
the Depositor and authenticated by the
Trustee, subordinated in right of payment
to the Class A Certificates, substantially
in the form of the Class M
Certificate set forth in Exhibit D
hereto.
CLASS M INTEREST ACCRUAL AMOUNT: With respect to any Distribution
Date,
one (1) month's interest at the Certificate
Rate on the Outstanding Certificate
Principal Balance of the Class M
Certificates minus (i) any Compensating
Interest Shortfall allocated to the Class M
Certificates on such Distribution
Date pursuant to Section 6.05(b), (ii) any
Realized Loss Interest Shortfall
resulting from an Excess Loss allocated to
the Class M Certificates on such
Distribution Date pursuant to Section
6.05(c) and (iii) any interest shortfall
resulting from the Relief Act allocated to
the Class M Certificates on such
Distribution Date pursuant to Section
6.05(d).
CLASS M PERCENTAGE: As of any Distribution Date, the percentage
obtained by dividing the Class M Principal
Balance by the Mortgage Pool
Principal Balance, but not more than 100%;
provided, however, that on any
Distribution Date on which the Class B
Percentage equals 0%, the Class M
Percentage shall equal 100% minus the Class
A Percentage.
CLASS M PRINCIPAL BALANCE: As of any Distribution Date, (a) the
Class M
Principal Balance for the immediately
preceding Distribution Date less (b)
amounts distributed to the Class M
Certificateholders on such preceding
Distribution Date allocable to principal
(including the principal portion of
Advances of the Servicer made pursuant to
Section 6.03 and Realized Losses
allocated to the Class M Certificates
pursuant to Section 6.04); provided that
the Class M Principal Balance on the first
Distribution Date shall be the
Original Class M Principal Balance, and
provided further that if the aggregate
Outstanding Certificate Principal Balance
of the Class B Certificates has been
reduced to zero, as of any Distribution
Date, the Class M Principal Balance will
equal the excess of the Mortgage Pool
Principal Balance (together with the
portion of any Monthly Payment due but not
paid with respect to which an Advance
has not been made) over the Class A
Principal Balance.
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<PAGE>
CLASS M SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class M
Interest Accrual Amount over the
amount actually distributed to the Class M
Certificateholders on such
Distribution Date pursuant to Section
6.01(c) (A) and (B).
CLOSING DATE: October 26, 2005.
CODE: The Internal Revenue Code of 1986, as amended from time to
time,
and any successor statutes thereto, and
applicable U.S. Department of Treasury
temporary or final regulations promulgated
thereunder.
COLLECTION ACCOUNT: The account created and maintained pursuant
to
Section 5.08.
COMPENSATING INTEREST: The meaning specified in Section
6.05(a).
COMPENSATING INTEREST SHORTFALL: The meaning specified in
Section
6.05(b).
CO-OP LEASE: With respect to a Co-op Loan, the lease with respect
to a
dwelling unit occupied by the Mortgagor and
relating to the stock allocated to
the related dwelling unit.
CO-OP LOAN: A Mortgage Loan secured by the pledge of stock
allocated to
a dwelling unit in a residential
cooperative housing corporation and a
collateral assignment of the related Co-op
Lease.
CREDIT SUPPORT: With respect to each Class of Subordinated
Certificates
(other than the Class B-5 Certificates),
the level of credit support supporting
such Class, expressed as a percentage of
the aggregate Outstanding Certificate
Principal Balance of all Classes of
Certificates (other than the Class A-P
Certificates). With respect to each
Distribution Date, Credit Support for each
such Class will equal in each case the
percentage, rounded to two decimal
places, obtained by dividing the aggregate
Outstanding Certificate Principal
Balances immediately prior to such
Distribution Date of all Classes of
Subordinated Certificates having higher
numerical class designations than such
Class (for this purpose, the Class M
Certificates shall be deemed to have a
lower numerical class designation than each
Class of Class B Certificates) by
the aggregate Outstanding Certificate
Principal Balance of all Classes of
Certificates (other than the Class A-P
Certificates) immediately prior to such
Distribution Date.
CREDIT SUPPORT DEPLETION DATE: The first Distribution Date on which
the
aggregate Outstanding Certificate Principal
Balance of the Subordinated
Certificates has been or will be reduced to
zero.
CUT-OFF DATE: October 1, 2005.
DEBT SERVICE REDUCTION: With respect to any Mortgage Loan, a
reduction
in the scheduled Monthly Payment for such
Mortgage Loan by a court of competent
jurisdiction in a proceeding under the
Bankruptcy Code, other than such a
reduction resulting from a Deficient
Valuation.
DEFICIENT VALUATION: With respect to any Mortgage Loan, a valuation
of
the related Mortgaged Property (or stock
allocated to a dwelling unit, in the
case of a Co-op Loan) by a court of
competent jurisdiction in an amount less
than the then outstanding Principal Balance
of the Mortgage Loan, which
valuation results from a proceeding
initiated under the Bankruptcy Code.
DEFINITIVE CERTIFICATES: The Certificates referred to in
Section
4.01(c).
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DEPOSITOR: Chase Mortgage Finance Corporation, a Delaware
corporation,
or its successor in interest or any
successor under this Agreement appointed as
herein provided.
DEPOSITORY: The Depository Trust Company, the nominee of which is
Cede
& Co.
DEPOSITORY AGREEMENT: The agreement referred to in Section
4.01(b).
DEPOSITORY PARTICIPANT: A broker, dealer, bank or other
financial
institution or other Person for whom from
time to time the Depository effects
book-entry transfers and pledges of
securities deposited with the Depository.
DETERMINATION DATE: The sixteenth day of the month in which the
related
Distribution Date occurs (or, if such
sixteenth day is not a Business Day, the
preceding Business Day).
DISCOUNT MORTGAGE LOAN: Any Mortgage Loan having a Net Mortgage
Rate
less than the Remittance Rate.
DISQUALIFIED ORGANIZATION: An organization referred to in
Section
860E(e)(5) of the Code.
DISTRIBUTION DATE: The 25th day of any month, or if such 25th day
is
not a Business Day, the first Business Day
immediately following, beginning with
November 25, 2005.
DUE DATE: The first day of each month, being the day of the month
on
which each Monthly Payment is due on a
Mortgage Loan, exclusive of any days of
grace.
DUE PERIOD: With respect to any Distribution Date, the period from
the
second day of the month preceding the month
in which such Distribution Date
occurs through the first day of the month
in which such Distribution Date
occurs.
ELIGIBLE ACCOUNT: An account that is (i) maintained with a
depository
institution the long-term unsecured debt
obligations of which are rated by each
Rating Agency in one of its two highest
rating categories, or (ii) maintained
with the corporate trust department of a
national bank or banking corporation
which (a) has a rating of at least Baa3 or
P-3 by Moody's and (b) is either
Chase or is the corporate trust department
of a national bank or banking
corporation which has a rating of at least
A-1 by S&P or F1 by Fitch Ratings, or
(iii) an account or accounts the deposits
in which are fully insured by the
FDIC, or (iv) an account or accounts in a
depository institution in which such
accounts are insured by the FDIC (to the
limit established by the FDIC), the
uninsured deposits in which accounts are
otherwise secured such that, as
evidenced by an Opinion of Counsel
delivered to and acceptable to the Trustee
and each Rating Agency, the
Certificateholders have a claim with respect to the
funds in such account and a perfected first
security interest against any
collateral (which shall be limited to
Eligible Investments) securing such funds
that is superior to claims of any other
depositors or creditors of the
depository institution with which such
account is maintained, provided, however,
that such uninsured deposits do not result
in the reduction of the ratings
assigned to the Certificates by the Rating
Agencies as evidenced by a letter
from each Rating Agency or (v) otherwise
acceptable to each Rating Agency
without reduction or withdrawal of the
rating of any Class of Certificates, as
evidenced by a letter from each Rating
Agency.
ELIGIBLE INVESTMENTS: One or more of the following:
(i) obligations of, or guaranteed as to principal and interest by,
the
United States or obligations of any agency
or instrumentality thereof when such
obligations are backed by the full faith
and credit of the United States;
provided that any such obligation held as a
"cash flow investment" within the
meaning of section 860G(a)(6) of the Code
shall mature before the next
Distribution Date;
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(ii) repurchase agreements on obligations specified in clause
(i)
maturing not more than two months from the
date of acquisition thereof, provided
that the long-term unsecured obligations of
the party agreeing to repurchase
such obligations are at the time rated by
each Rating Agency with its highest
rating and the short-term debt obligations
of the party agreeing to repurchase
are rated with one of the two highest
ratings by Moody's and A-1+ by S&P;
(iii) federal funds, certificates of deposit, time deposits and
bankers' acceptances (other than bankers'
acceptances issued by Chase or any of
its Affiliates) (which shall each have an
original maturity of not more than 60
days and, in the case of bankers'
acceptances, shall in no event have an
original maturity of more than 365 days) of
any United States depository
institution or trust company incorporated
under the laws of the United States or
any state, provided that the long-term
unsecured debt obligations of such
depository institution or trust company at
the date of acquisition thereof have
been rated by each Rating Agency with its
highest rating and the short-term
obligations of such depository institution
or trust company are rated A-1+ by
S&P and P-1 by Moody's;
(iv) commercial paper (other than commercial paper issued by Chase
or
any of its Affiliates) (having original
maturities of not more than 365 days) of
any corporation incorporated under the laws
of the United States or any state
thereof which on the date of acquisition
has been rated by each Rating Agency in
its highest short-term unsecured commercial
paper rating category; provided that
such commercial paper shall have a
remaining maturity of not more than 45 days;
(v) units of taxable money market funds (including those for which
the
Trustee or the Servicer or any Affiliate
thereof receives compensation with
respect to such investment) which may be
12b-1 funds, as contemplated under the
rules promulgated by the Securities and
Exchange Commission under the Investment
Company Act of 1940, as amended, and which
funds have been rated by each Rating
Agency in its highest rating category or
which have been designated in writing
by each Rating Agency as Eligible
Investments with respect to this definition;
or
(vi) other obligations or securities (other than investments or
obligations of Chase or any of its
Affiliates) acceptable to each Rating Agency
rating the Certificates as an Eligible
Investment hereunder and will not result
in a reduction or withdrawal in the then
current rating of any Class of
Certificates, as evidenced by a letter to
such effect from each Rating Agency;
Provided that no such instrument shall be
an Eligible Investment if such
instrument evidences either (a) a right to
receive only interest payments with
respect to the obligations underlying such
instrument, or (b) both principal and
interest payments derived from obligations
underlying such instrument where the
interest and principal payments with
respect to such instrument provide a yield
to maturity of greater than 120% of the
yield to maturity at par of such
underlying obligations; and provided
further that no such instrument shall be
purchased above par; and provided further
that each Eligible Investment must be
a "permitted investment" within the meaning
of Section 860G(a)(5) of the Code.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended
from time to time, and any successor
statutes thereto, and applicable U.S.
Department of Labor temporary or final
regulations promulgated thereunder.
ERISA QUALIFYING UNDERWRITING: A best efforts or firm
commitment
underwriting or private placement that
would satisfy the requirements of
Prohibited Transaction Exemption 2002-19,
67 Fed. Reg. 14797 (March 28, 2002),
as amended, or any substantially similar
administrative exemption granted by the
U.S. Department of Labor to Chase, except,
in relevant part, for the requirement
that the certificates have received a
rating at the time of acquisition that is
in one of the three (or four, in the case
of a "designated transaction") highest
generic rating categories by at least one
of the Rating Agencies.
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<PAGE>
ERISA RESTRICTED CERTIFICATE: Any Class B-3, Class B-4 or Class
B-5
Certificate and any other Certificate, so
long as the acquisition and holding of
such Certificate is not covered by and
exempt under Prohibited Transaction
Exemption 2002-19, 67 Fed. Reg. 14797
(March 28, 2002), as amended, or any
substantially similar administrative
exemption granted by the U.S. Department of
Labor to Chase.
ESCROW ACCOUNT: The account or accounts created and maintained
pursuant
to Section 5.10.
ESCROW PAYMENTS: The amounts constituting applicable ground
rents,
taxes, assessments, water rates, Standard
Hazard Policy premiums and other
payments required to be escrowed by the
Mortgagor with the mortgagee pursuant to
a Mortgage Loan.
EVENT OF DEFAULT: Any of the events specified in Section 9.01.
EXCEPTION REPORT: The report of the Trustee, or its custodian,
referred
to in Section 2.02.
EXCESS BANKRUPTCY LOSS: Any Bankruptcy Loss, or portion thereof,
which
exceeds the then applicable Bankruptcy
Amount.
EXCESS FRAUD LOSS: Any Fraud Loss, or portion thereof, which
exceeds
the then applicable Fraud Loss Amount.
EXCESS LOSSES: Excess Bankruptcy Losses, Excess Fraud Losses and
Excess
Special Hazard Losses, referred to
collectively.
EXCESS PROCEEDS: All amounts (net of the related Servicing
Advances)
received on any Mortgage Loan (whether as
regular principal payments, Principal
Prepayments, Repurchase Proceeds,
Liquidation Proceeds, Subsequent Recoveries,
Insurance Proceeds, condemnation awards, or
with respect to a disposition of a
Mortgaged Property (or stock allocated to a
dwelling unit, in the case of a
Co-op Loan) which has been acquired by
foreclosure or deed in lieu of
foreclosure or otherwise) in excess of the
Principal Balance at the Cut-off Date
of such Mortgage Loan and accrued interest
thereon at its Mortgage Rate to the
Due Date immediately succeeding the date of
prepayment, repurchase or
liquidation, as the case may be.
EXCESS SPECIAL HAZARD LOSS: Any Special Hazard Loss, or portion
thereof, that exceeds the then applicable
Special Hazard Amount.
FDIC: The Federal Deposit Insurance Corporation or any
successor
organization.
FHLMC: The Federal Home Loan Mortgage Corporation or any
successor
organization.
FIDELITY BOND: The fidelity bond and errors and omissions insurance
to
be maintained by the Servicer pursuant to
Section 5.19.
FINAL SCHEDULED DISTRIBUTION DATE. The Distribution Date in
November
2035.
FITCH RATINGS: Fitch, Inc. or its successor in interest.
FNMA: The Federal National Mortgage Association, or any
successor
organization.
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FNMA GUIDES: The FNMA Sellers' Guide and the FNMA Servicers' Guide,
and
all amendments or additions thereto.
FRAUD LOSS: Any Realized Loss or portion thereof sustained by
reason of
a default arising from fraud, dishonesty or
misrepresentation in connection with
the related Mortgage Loan, including by
reason of the denial of coverage under
any related Primary Insurance Policy.
FRAUD LOSS AMOUNT: As of any date of determination after the
Cut-off
Date, an amount (initially, $22,935,633.63)
equal to (W) prior to the first
anniversary of the Cut-off Date, (a) 3.00%
of the aggregate principal balance of
all of the Mortgage Loans as of the Cut-off
Date minus (b) the aggregate amounts
allocated to the Certificates with respect
to Fraud Losses on the Mortgage Loans
up to such date of determination, (X) prior
to the second anniversary of the
Cut-off Date, (a) 2.00% of the aggregate
principal balance of all of the
Mortgage Loans as of the first anniversary
of the Cut-off Date minus (b) the
aggregate amounts allocated to the
Certificates with respect to Fraud Losses on
the Mortgage Loans since the first
anniversary of the Cut-off Date up to such
date of determination, (Y) from the second
to the fifth anniversary of the
Cut-off Date, (a) 1.00% of the aggregate
principal balance of all of the
Mortgage Loans as of the most recent
anniversary of the Cut-off Date minus (b)
the aggregate amounts allocated to the
Certificates with respect to Fraud Losses
on the Mortgage Loans since the most recent
anniversary of the Cut-off Date up
to such date of determination, or (Z) on
and after the fifth anniversary of the
Cut-off Date, zero.
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,
either directly or indirectly.
INSURANCE PROCEEDS: Proceeds paid by any insurer pursuant to
any
insurance policy covering a Mortgage Loan,
net of costs of collecting such
proceeds and net of amounts released to the
Mortgagor or applied to the
restoration of the Mortgaged Property (or
in the underlying Mortgaged Property,
in the case of a Co-op Loan).
INSURED EXPENSES: Expenses covered by any insurance policy.
INTEREST ACCRUAL PERIOD: With respect to any Distribution Date and
any
Class of Certificates (other than the Class
A-P Certificates), the calendar
month immediately preceding the month in
which the related Distribution Date
occurs, calculated on the basis of a
360-day year of twelve 30-day months.
LATE COLLECTIONS: With respect to any Mortgage Loan, all
amounts
received during any Due Period, whether as
late payments of Monthly Payments or
as Liquidation Proceeds, condemnation
proceeds, Insurance Proceeds, Subsequent
Recoveries or with respect to a disposition
of a Mortgaged Property (or stock
allocated to a dwelling unit, in the case
of a Co-op Loan) which has been
acquired by foreclosure or deed in lieu of
foreclosure or otherwise, which
represent late payments or collections of
Monthly Payments due but delinquent
for a previous Due Period and not
previously recovered.
LIQUIDATED
MORTGAGE LOAN: Any Mortgage Loan (a) as to which the
Servicer has determined that all amounts
which it expects to recover from or on
account of such Mortgage Loan or property
acquired in respect thereof have been
recovered, (b) as to which a Cash
Liquidation has taken place or (c) with
respect to which the Mortgaged Property (or
stock allocated to a dwelling unit,
in the case of a Co-op Loan) has been
acquired by foreclosure or deed in lieu of
foreclosure and a disposition (the term
disposition shall include, for purposes
of a repurchase pursuant to Section 11.01,
any repurchase of a Mortgaged
Property (or stock allocated to a dwelling
unit, in the case of a Co-op Loan)
pursuant to such Section) of such Mortgaged
Property (or stock allocated to a
dwelling unit, in the case of a Co-op Loan)
has occurred.
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LIQUIDATION EXPENSES: Expenses which are incurred by the Servicer
or
any Sub-Servicer in connection with the
liquidation of any defaulted Mortgage
Loan or property acquired in respect
thereof including, without limitation,
legal fees and expenses, any unreimbursed
amount expended by the Servicer
pursuant to Sections 5.16 and 5.21
respecting the related Mortgage Loan and any
related and unreimbursed expenditures for
real estate property taxes or for
property restoration or preservation.
LIQUIDATION PROCEEDS: Cash (including Insurance Proceeds) received
by
the Servicer in connection with the
liquidation of any Mortgage Loan or
Mortgaged Property (or stock allocated to a
dwelling unit, in the case of a
Co-op Loan) acquired in respect thereof,
whether through the sale or assignment
of such Mortgage Loan (other than pursuant
to Section 5.21), trustee's sale,
foreclosure sale or otherwise, or the sale
of the Mortgaged Property (or stock
allocated to a dwelling unit, in the case
of a Co-op Loan) if the Mortgaged
Property (or stock allocated to a dwelling
unit, in the case of a Co-op Loan) is
acquired in satisfaction of the Mortgage
Loan other than amounts required to be
paid to the Mortgagor pursuant to law or
the terms of the applicable Mortgage
Note.
LOAN-TO-VALUE RATIO: The fraction, expressed as a percentage,
the
numerator of which is the principal amount
of the related Mortgage Loan at the
time of origination (or, (i) for purposes
of Section 5.15, at the time of
determination and (ii) for purposes of a
Mortgage Loan with respect to which a
conversion from adjustable rate to fixed
rate has occurred, at the time of
initial origination) and the denominator of
which is the Appraised Value of the
related Mortgaged Property (or applicable
dwelling unit, in the case of a Co-op
Loan) at the time of origination or, in the
case of a Mortgage Loan financing
the acquisition of the Mortgaged Property
(or applicable dwelling unit, in the
case of a Co-op Loan), the sales price of
the Mortgaged Property (or applicable
dwelling unit, in the case of a Co-op
Loan), if such sales price is less than
such appraised value; provided however,
certain Mortgage Loans financing the
acquisition of a Mortgaged Property in New
York will be based solely on the
appraised value.
MERS: Mortgage Electronic Registration Systems, Inc., a
Delaware
corporation, or any successor in interest
thereto.
MERS MORTGAGE LOAN:
Any Mortgage Loan as to which the related Mortgage,
or an Assignment of Mortgage, has been or
will be recorded in the name of MERS
or otherwise assigned to MERS, as agent for
the holder from time to time of the
Mortgage Note.
MODIFIED MORTGAGE
LOAN: Any Mortgage Loan which the Servicer has
modified pursuant to Section 5.01.
MONTHLY PAYMENT: The minimum required monthly payment of principal
and
interest due on a Mortgage Loan as
specified in the Mortgage Note for any Due
Date (before any adjustment to such
scheduled amount by reason of any bankruptcy
or similar proceeding or any moratorium or
similar waiver or grace period).
Monthly Payments shall be deemed due on an
Outstanding Mortgage Loan until such
time as it becomes a Liquidated Mortgage
Loan.
MOODY'S: Moody's Investors Service, Inc. or its successor in
interest.
MORTGAGE: With respect to a Mortgage Loan that is not a Co-op Loan,
the
mortgage, deed of trust or other instrument
creating a first lien or a first
priority ownership interest in an estate in
fee simple in real property securing
a Mortgage Note. With respect to a Co-op
Loan, the security agreement creating a
security interest in the stock allocated to
a dwelling unit in a residential
cooperative housing corporation and pledged
to secure such Co-op Loan and the
related Co-op Lease.
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MORTGAGE FILE: As to each Mortgage Loan, the items referred to
in
Exhibit B annexed hereto.
MORTGAGE
LOAN: An individual mortgage loan and all rights with respect
thereto, evidenced by a Mortgage and a
Mortgage Note, sold and assigned by the
Depositor to the Trustee and which is
subject to this Agreement and included in
the Trust Fund. The Mortgage Loans
originally sold and subject to this Agreement
are identified on the Mortgage Loan
Schedule.
MORTGAGE LOAN SCHEDULE: The schedule of Mortgage Loans attached
hereto
as Exhibit A as it may be amended in
accordance with Section 3.03, setting forth
the following information as to each
Mortgage Loan: (i) the Mortgage Loan
identifying number; (ii) the city, state
and zip code of the Mortgaged Property
(or Underlying Mortgaged Property, in the
case of a Co-op Loan); (iii) an
indication of whether the Mortgaged
Property (or the related residential
dwelling unit in the Underlying Mortgaged
Property, in the case of a Co-op Loan)
is owner-occupied; (iv) the property type
of the Mortgaged Property (or the
related residential dwelling unit in the
Underlying Mortgaged Property, in the
case of a Co-op Loan); (v) the original
number of months to stated maturity;
(vi) the number of months remaining to
stated maturity from the Cut-off Date;
(vii) the original Loan-to-Value Ratio;
(viii) the original principal balance of
the Mortgage Loan; (ix) the unpaid
principal balance of the Mortgage Loan as of
the close of business on the Cut-off Date;
(x) the Mortgage Rate; (xi) the
amount of the current Monthly Payment; and
(xii) the PO Percentage with respect
to such Mortgage Loan.
MORTGAGE NOTE: The note or other evidence of the indebtedness of
a
Mortgagor secured by a Mortgage.
MORTGAGE POOL: The pool of Mortgage Loans held in the Trust
Fund.
MORTGAGE POOL PRINCIPAL BALANCE: As of any date of determination,
the
aggregate of the Principal Balances of each
Outstanding Mortgage Loan on such
date of determination less the principal
portion of any Monthly Payment due but
not paid with respect to which an Advance
has not been made, initially
$764,521,121.09.
MORTGAGED PROPERTY: The property securing a Mortgage Note.
MORTGAGE RATE: With respect to each Mortgage Loan, the per annum
rate
of interest borne by the Mortgage Loan, as
specified in the Mortgage Note. The
Mortgage Rate for any Mortgage Loan shall
be zero with respect to the period
prior to the period during which interest
accrues with respect to such Mortgage
Loan's first Monthly Payment.
MORTGAGOR: The obligor on a Mortgage Note.
NET LIQUIDATION PROCEEDS: As to any Liquidated Mortgage Loan,
Liquidation Proceeds net of Liquidation
Expenses.
NET MORTGAGE RATE: With respect to each Mortgage Loan, a per annum
rate
of interest for the applicable period equal
to the Mortgage Rate less (i) the
Servicing Fee Rate and (ii) in the case of
a substitute Mortgage Loan, any
excess of the Mortgage Rate on the
substitute Mortgage Loan over the Mortgage
Rate on the removed Mortgage Loan.
NON-DISCOUNT MORTGAGE LOANS: The Mortgage Loans having Net
Mortgage
Rates in excess of the Remittance Rate.
NON-MERS MORTGAGE LOAN: Any Mortgage Loan other than a MERS
Mortgage
Loan.
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NON-PO ALLOCATED AMOUNT: At the time of any determination, the
amount
derived by (i) multiplying the Principal
Balance of each Outstanding Mortgage
Loan on such date of determination by the
Non-PO Percentage with respect to such
Mortgage Loan and (ii) summing the
results.
NON-PO CLASS A CERTIFICATES: The Class A-1, Class A-2, Class A-3,
Class
A-4, Class A-5, Class A-6, Class A-7, Class
A-8, Class A-9, Class A-10, Class
A-11, Class A-12, Class A-13, Class A-14,
Class A-15, Class A-R and Class A-X
Certificates, referred to collectively.
NON-PO CLASS A OPTIMAL PRINCIPAL AMOUNT: With respect to any
Distribution Date, the lesser of (a) the
Non-PO Class A Principal Balance and
(b) the sum of:
(i) the Non-PO Class A Percentage of the applicable
Non-PO Percentage of the principal portion of all Monthly
Payments, whether or not received, which were due during the
related Due Period on Mortgage Loans which were outstanding
during such Due Period;
(ii) the Non-PO Class A Prepayment Percentage of the
applicable Non-PO Percentage of all Principal Prepayments made
on any Mortgage Loan during the related Principal Prepayment
Period;
(iii) with respect to each Mortgage Loan not
described in (iv) below, the Non-PO Class A Percentage of the
applicable Non-PO Percentage of the principal portion of all
Insurance Proceeds, condemnation awards and any other cash
proceeds from a source other than the applicable Mortgagor, to
the extent required to be deposited in the Collection Account
pursuant to Section 5.08(iv) and (v), which were received
during the related Principal Prepayment Period, net of related
unreimbursed Servicing Advances and net of any portion thereof
which, as to any such Mortgage Loan, constitutes Late
Collections that have been the subject of an Advance on any
prior Distribution Date;
(iv) with respect to each Mortgage Loan which has
become a Liquidated Mortgage Loan during the related Principal
Prepayment Period, the lesser of (A) the Non-PO Class A
Percentage of applicable Non-PO Percentage of an amount equal
to the Principal Balance of such Liquidated Mortgage Loan as
of the Due Date immediately preceding the date on which it
became a Liquidated Mortgage Loan and (B) the Non-PO Class A
Prepayment Percentage of the applicable Non-PO Percentage of
the Net
Liquidation Proceeds with respect to such liquidated
Mortgage Loan (net of any unreimbursed Advances);
(v) with respect to each Mortgage Loan repurchased
during the related Principal Prepayment Period pursuant to
Section 2.02, 3.01, 5.01, 5.21 or 11.01, an amount equal to
the Non-PO Class A Prepayment Percentage of the applicable
Non-PO Percentage of the principal portion of the Purchase
Price (net of amounts with respect to which a distribution of
principal has previously been made to the Non-PO Class A
Certificateholders); and
(vi) on or after the Credit Support Depletion Date,
the excess of the Non-PO Class A Principal Balance (calculated
after giving effect to reductions thereof on such Distribution
Date with respect to the amounts described in (i) - (v) above)
over the Non-PO Allocated Amount, if any, as of the preceding
Distribution Date.
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NON-PO CLASS A PERCENTAGE: As of any Distribution Date, the
fraction,
expressed as a percentage (which shall
never exceed 100%), the numerator of
which is the Non-PO Class A Principal
Balance and the denominator of which is
the Non-PO Allocated Amount as of the
immediately preceding Due Date.
NON-PO CLASS A PREPAYMENT PERCENTAGE: As of any Distribution Date
up to
and including the Distribution Date in
October 2010, 100%; as of any
Distribution Date during the first year
thereafter, the Non-PO Class A
Percentage plus 70% of the Subordinated
Percentage for such Distribution Date;
as of any Distribution Date during the
second year thereafter, the Non-PO Class
A Percentage plus 60% of the Subordinated
Percentage for such Distribution Date;
as of any Distribution Date during the
third year thereafter, the Non-PO Class A
Percentage plus 40% of the Subordinated
Percentage for such Distribution Date;
as of any Distribution Date during the
fourth year thereafter, the Non-PO Class
A Percentage plus 20% of the Subordinated
Percentage for such Distribution Date;
and as of any Distribution Date after the
fourth year thereafter, the Non-PO
Class A Percentage; provided that if the
Non-PO Class A Percentage as of any
such Distribution Date is greater than the
Non-PO Class A Percentage on the
first Distribution Date, the Non-PO Class A
Prepayment Percentage shall be 100%;
and provided further that whenever the
Non-PO Class A Percentage equals 0%, the
Non-PO Class A Prepayment Percentage shall
equal 0%; and provided further,
however, that no reduction of the Non-PO
Class A Prepayment Percentage below the
level in effect for the most recent period
shall occur with respect to any
Distribution Date unless, as of the last
day of the month preceding such
Distribution Date, (A) the aggregate
outstanding Principal Balance of the
Outstanding Mortgage Loans 60 days or more
delinquent (including Mortgage Loans
in foreclosure and with respect to which
the related Mortgaged Property (or
stock allocated to a dwelling unit, in the
case of a Co-op Loan) has been
acquired by the Trust Fund) does not exceed
50% of the aggregate Outstanding
Certificate Balance of the Subordinated
Certificates as of such date and (B)
cumulative Realized Losses through the last
day of the month preceding such
Distribution Date (including Nonrecoverable
Advances) do not exceed (i) if such
Distribution Date occurs in the year
beginning with and including the fifth
anniversary of the first Distribution Date,
30% of the Original Subordinated
Principal Balance, (ii) if such
Distribution Date occurs in the year beginning
with and including the sixth anniversary of
the first Distribution Date, 35% of
the Original Subordinated Principal
Balance, (iii) if such Distribution Date
occurs in the year beginning with and
including the seventh anniversary of the
first Distribution Date, 40% of the
Original Subordinated Principal Balance,
(iv) if such Distribution Date occurs in
the year beginning with and including
the eighth anniversary of the first
Distribution Date, 45% of the Original
Subordinated Principal Balance and (v) if
such Distribution Date occurs in the
year beginning with and including the ninth
anniversary of the first
Distribution Date and thereafter, 50% of
the Original Subordinated Principal
Balance.
NON-PO CLASS A PRINCIPAL BALANCE: As of any Distribution Date, (a)
the
Non-PO Class A Principal Balance for the
immediately preceding Distribution Date
less (b) amounts distributed (or deemed
distributed) to the Non-PO Class A
Certificateholders on such preceding
Distribution Date allocable to principal
(including the principal portion of
Advances of the Servicer made pursuant to
Section 6.03 and Realized Losses allocated
to the Non-PO Class A Certificates
pursuant to Section 6.04); provided that
the Non-PO Class A Principal Balance on
the first Distribution Date shall be the
Original Non-PO Class A Principal
Balance.
NON-PO CLASS A PRINCIPAL PAYMENT RULES: With respect to any
Distribution Date, distributions to the
Non-PO Class A Certificateholders
pursuant to Section 6.01(b)(ii)(A) shall be
made in the following amounts and
priority:
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<PAGE>
(I) With respect to any Distribution Date
prior to the Credit Support Depletion
Date, distributions of the Non-PO Class A
Optimal Principal Amount to the Non-PO
Class A Certificateholders pursuant to
Section 6.01(b)(ii)(A) shall be made in
the following amounts and priority:
First, to the Class A-R Certificate, until
the Outstanding Certificate Principal
Balance of such Class has been reduced to
zero;
Second, to the Class A-1 and the Class A-2
Certificates, pro rata based upon
their Outstanding Certificate Principal
Balances, up to the Class A-1/A-2
Lockout Principal Distribution Amount,
until the Outstanding Certificate
Principal Balance of each such Class has
been reduced to zero;
Third, concurrently:
69.7026160276% to the Class A-3, Class A-4,
Class A-5, Class A-6, Class A-7,
Class A-8, Class A-9 and Class A-10, as
follows:
(a) first, concurrently:
(i)
38.9629618085% to the Class A-3 Certificates, until
the Outstanding Certificate Principal Balance of
such Class has been reduced to zero; and
(ii)
61.0370381915% as follows:
(A) first, to the Class A-4, Class A-5
and Class
A-6 Certificates, pro rata based upon their
Outstanding Certificate Principal Balances,
until the Outstanding Certificate Principal
Balance of each such Class has been reduced
to zero; and
(B) second, to
the Class A-7 Certificates, until
the Outstanding Certificate Principal Balance
of such Class has been reduced to zero; and
(b) second, sequentially, to the Class A-7, Class A-8, Class A-9
and
Class A-10 Certificates, until the Outstanding Certificate
Principal
Balance of each such Class has been reduced to zero; and:
30.2973839724% as follows:
(a) first,
beginning on the Distribution Date occurring in November
2008, to the Class A-11 Certificates, until the Outstanding
Certificate Principal Balance of such Class has been reduced to
zero;
(b)
second, beginning on the Distribution Date occurring in
November
2009, to the Class A-12 Certificates, until the Outstanding
Certificate Principal Balance of such Class has been reduced to
zero;
(c) third,
beginning on the Distribution Date occurring in November
2010, to the Class A-13 Certificates, until the Outstanding
Certificate Principal Balance of such Class has been reduced to
zero;
(d)
fourth, sequentially, to the Class A-14 and Class A-15
Certificates, until the Outstanding Certificate Principal
Balance of each such Class has been reduced to zero; and
(e) fifth,
sequentially, to the Class A-11, Class A-12 and Class
A-13 Certificates, until the Outstanding Certificate Principal
Balance of each such Class has been reduced to zero; and
Fourth, to the Class A-1 and the Class A-2
Certificates, pro rata without regard
to the Class A-1/A-2 Lockout Principal
Distribution Amount, until the
Outstanding Certificate Principal Balance
of each such Class has been reduced to
zero.
22
<PAGE>
(II) With respect to any Distribution Date
on or after the Credit Support
Depletion Date, distributions pursuant to
Section 6.01(b)(ii)(A) shall be made
pro rata among the outstanding Classes of
Non-PO Class A Certificates in
relation to the respective Outstanding
Certificate Principal Balances of such
outstanding Classes, and not in accordance
with the priority of payments among
such Classes set forth in clause (I)
above.
NON-PO PERCENTAGE: With respect to each Mortgage Loan, the
fraction,
expressed as a percentage (but not greater
than 100%), the numerator of which
equals the applicable Net Mortgage Rate and
the denominator of which equals the
Remittance Rate.
NONRECOVERABLE ADVANCE: Any Advance previously made or proposed to
be
made in respect of a Mortgage Loan by the
Servicer pursuant to Section 6.03
which, in the good faith judgment of the
Servicer, will not or, in the case of a
proposed Advance, would not, ultimately be
recoverable by the Servicer from Late
Collections or otherwise. The determination
by the Servicer that it has made, or
would be making, a Nonrecoverable Advance
shall be evidenced by a certificate of
a Servicing Officer of the Servicer
delivered to the Trustee, any co-trustee and
the Depositor and detailing the reasons for
such determination.
OFFICERS' CERTIFICATE: A certificate signed by two of the Chairman
of
the Board, the Vice Chairman of the Board,
the President or a Vice President,
the Treasurer or the Secretary or one of
the Assistant Treasurers or Assistant
Secretaries or any other duly authorized
officer of the Depositor or the
Servicer, and delivered to the Trustee.
OPINION OF COUNSEL: A written opinion of counsel, who may be
counsel
for the Depositor or the Servicer and who
is reasonably acceptable to the
Trustee.
ORIGINAL CERTIFICATE PRINCIPAL BALANCE: With respect to any Class
of
Certificates, the amount specified for such
Class in Section 4.01(d).
ORIGINAL CLASS A PRINCIPAL BALANCE:
$738,909,652.00.
ORIGINAL CLASS M PRINCIPAL BALANCE:
$13,761,000.00.
ORIGINAL CLASS B PRINCIPAL BALANCE:
$11,850,468.85.
ORIGINAL CREDIT SUPPORT: With respect to any Class of
Subordinated
Certificates (other than the Class B-5
Certificates), the level of Credit
Support indicated below:
Class M:
1.55%
Class B-1:
0.90%
Class B-2:
0.55%
Class B-3:
0.35%
Class B-4:
0.20%
ORIGINAL NON-PO CLASS A PRINCIPAL BALANCE:
$737,123,100.00.
ORIGINAL SUBORDINATED PRINCIPAL BALANCE: The aggregate of the
Original
Class M Principal Balance and the Original
Class B Principal Balance.
23
<PAGE>
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE: With respect to any
Class
(other than the Class A-X) of Certificates
and any Distribution Date, the
Original Certificate Principal Balance of
such Class minus the sum of (i) any
distributions of principal made on such
Class prior to such Distribution Date
and (ii) any Realized Losses allocated to
such Class prior to such Distribution
Date plus, in the case of Class A-15
Certificates, on each Distribution Date
prior to the Class A-15 Accretion
Termination Date, the amounts calculated for
such Distribution Date pursuant to Section
6.01(b)(i)(R); provided, further,
however, that on any Distribution Date on
which a Subsequent Recovery is
distributed, the Outstanding Certificate
Principal Balance of any Class of
Certificates then outstanding for which any
Realized Loss has been applied will
be increased, in order of seniority, by an
amount equal to the lesser of (i) the
amount the Class of Certificates has been
reduced by any Realized Losses which
have not been previously offset by any
Subsequent Recovery pursuant to this
proviso and (ii) the total amount of any
Subsequent Recovery distributed on such
date to Certificateholders (as reduced (x)
by increases in the Outstanding
Certificate Principal Balance of more
senior Classes of Certificates on such
Distribution Date and (y) to reflect a
proportionate amount of what would (but
for this clause (y)) have been the
increases in the Outstanding Certificate
Principal Balance of Classes of
Certificates of equal seniority on such
Distribution Date); provided, further,
however, that (I) with respect to the
Class of Class B Certificates then
outstanding having the highest numerical
class designation, the Outstanding
Certificate Principal Balance of such Class
shall equal the excess of the Mortgage Pool
Principal Balance (together with the
principal portion of any Monthly Payment
due but not paid with respect to which
an Advance has not been made) over the sum
of the Outstanding Certificate
Principal Balances of all Classes of
Certificates (other than the Class of Class
B Certificates then outstanding having the
highest numerical class designation);
and (II) during such time as the
Outstanding Certificate Principal Balance of
the Class B-1 Certificates equals zero,
with respect to the Class M
Certificates, the Outstanding Certificate
Principal Balance of such Class shall
equal the excess of the Mortgage Pool
Principal Balance (together with the
principal portion of any Monthly Payment
due but not paid with respect to which
an Advance has not been made) over the
Class A Principal Balance.
OUTSTANDING MORTGAGE LOAN: As to any Distribution Date, a Mortgage
Loan
which was not paid in full during the
related or any previous Principal
Prepayment Period, which did not become a
Liquidated Mortgage Loan during the
related or any previous Principal
Prepayment Period and which was not
repurchased under Section 2.02, 3.01, 5.01,
5.21 or 11.01 during the related or
any previous Principal Prepayment
Period.
PASS-THRU ENTITY: A "Pass-Thru Entity" as defined in Section
860E(e)(6)
of the Code.
PAYING AGENT: The Person appointed by the Trustee as Paying
Agent
pursuant to Section 4.05.
PERCENTAGE INTEREST: As to any Certificate, the percentage
interest
evidenced thereby in distributions required
to be made hereunder, such
percentage interest being equal, with
respect to any Class, to the percentage
obtained by dividing the Outstanding
Certificate Principal Balance (or the Class
A-X Notional Amount in the case of the
Class A-X Certificates) of such
Certificate by the aggregate of the
Outstanding Certificate Principal Balances
(or Class A-X Notional Amount in the case
of the Class A-X Certificates) of all
the Certificates of such Class and with
respect to all Certificates, the
percentage obtained by dividing the
Outstanding Certificate Principal Balance of
such Certificate by the aggregate of the
Outstanding Certificate Principal
Balances of all the Certificates.
24
<PAGE>
PERMITTED ACTIVITIES: The primary activities of the Trust
created
pursuant to this Agreement which shall be:
(i) holding Mortgage Loans
transferred from the Depositor and other
assets of the Trust Fund, including any
credit enhancement and passive derivative
financial instruments that pertain to
beneficial interests issued or sold to
parties other than the Depositor, its
Affiliates, or its agents; (ii) issuing
certificates and other interests in the
assets of the Trust Fund; (iii) receiving
collections on the Mortgage Loans and
making payments on such certificates and
interests in accordance with the terms
of this Agreement; and (iv) engaging in
other activities that are necessary or
incidental to accomplish these limited
purposes, which activities cannot be
contrary to the status of the Trust Fund as
a qualified special purpose entity
under existing accounting literature.
PERSON: Any individual, corporation, partnership, limited
liability
company, limited liability partnership,
joint venture, association, joint-stock
company, trust, unincorporated organization
or government or any agency or
political subdivision thereof.
PO PERCENTAGE: The PO Percentage with respect to each Mortgage Loan
as
identified on the Mortgage Loan Schedule,
such percentage being equal to the
fraction, expressed as a percentage (but
not less than 0%), the numerator of
which equals the excess of the Remittance
Rate over the applicable Net Mortgage
Rate and the denominator of which equals
the Remittance Rate.
PRIMARY INSURANCE POLICY: Each primary policy of mortgage
guaranty
insurance or any replacement policy
therefor referred to in Section 5.15 hereof.
PRINCIPAL BALANCE: At the time of any determination, the
principal
balance of a Mortgage Loan remaining to be
paid at the close of business on the
Cut-off Date (after deduction of all
principal payments due on or before the
Cut-off Date whether or not paid) (or, in
the case of a substitute Mortgage Loan
included in the Trust Fund pursuant to
Section 3.04, the close of business as of
the date of substitution) reduced by all
amounts previously distributed to
Certificateholders that are allocable to
payments of principal on such Mortgage
Loan (including the principal portion of
Advances of the Servicer made pursuant
to Section 6.03).
PRINCIPAL PREPAYMENT: Any payment or other recovery of principal on
a
Mortgage Loan (other than Late Collections)
which is received other than as part
of a monthly payment; provided, however,
that the term Principal Prepayment does
not include Insurance Proceeds, Liquidation
Proceeds, Subsequent Recoveries,
condemnation awards or other cash proceeds
from a source other than the
applicable Mortgagor.
PRINCIPAL PREPAYMENT PERIOD: With respect to any Distribution Date,
the
period beginning on the first day of the
month preceding the month in which such
Distribution Date occurs and ending on the
last day of such month.
PURCHASE PRICE: With respect to any Mortgage Loan required to
be
purchased on any date pursuant to Section
2.02, 3.01, 5.01, 5.21 or 11.01, an
amount equal to the sum of (a) 100% of the
Principal Balance thereof, (b) unpaid
accrued interest at the Mortgage Rate
thereon from the Due Date on which
interest was last paid by the Mortgagor or
Advanced by the Servicer to the Due
Date next following the date of repurchase,
(c) the aggregate of any
unreimbursed Advances and any unreimbursed
Servicing Advances and (d) any
unreimbursed costs, penalties and/or
damages incurred by the Trust Fund and/or
the Trustee in connection with any
violation relating to such Mortgage Loan of
any predatory or abusive lending law.
QUALIFIED INSURER: An insurance company duly qualified as such
under
the laws of the states in which the
Mortgaged Properties are located, duly
authorized and licensed in such states to
transact the applicable insurance
business and to write the insurance
provided, approved as an insurer by FNMA and
FHLMC and whose claims-paying ability is
rated in the two highest rating
categories by S&P and Moody's with
respect to primary mortgage insurance and in
the two highest rating categories for
general policyholder rating and financial
performance index rating by A.M. Best
Company or its successor in interest with
respect to hazard and flood insurance.
25
<PAGE>
RATING AGENCY: Any nationally recognized statistical rating
organization, or its successor, that rated
one or more Classes of Certificates
at the request of the Depositor at the time
of the initial issuance of the
Certificates. If such organization or a
successor is no longer in existence,
"Rating Agency" shall be such nationally
recognized statistical rating
organization, or other comparable Person,
designated by the Depositor, notice of
which designation shall be given to the
Trustee and the Servicer. References
herein to the two highest long-term debt
rating categories of a Rating Agency
shall mean AA or better, in the case of
S&P and Fitch Ratings and Aa or better
in the case of Moody's.
REALIZED LOSS:
With respect to (i) a Liquidated Mortgage Loan, the
amount, if any, by which the unpaid
Principal Balance and accrued interest
thereon at a rate equal to the Net Mortgage
Rate exceeds the amount actually
recovered by the Servicer with respect
thereto (net of reimbursement of Advances
and Servicing Advances) at the time such
Mortgage Loan became a Liquidated
Mortgage Loan or (ii) with respect to a
Mortgage Loan which is not a Liquidated
Mortgage Loan, any amount of principal that
the Mortgagor is no longer legally
required to pay (except for the
extinguishment of debt that results from the
exercise of remedies due to default by the
Mortgagor).
REALIZED LOSS INTEREST SHORTFALL: The meaning specified in
Section
6.05(c).
RECORD DATE: The close of business of the last Business Day of
the
month preceding the month of the related
Distribution Date.
RELEVANT MORTGAGE LOAN: The meaning specified in Section 5.01.
RELIEF ACT: The Servicemembers Civil Relief Act or the
California
Military and Veterans Code, as amended, or
any other similar state or local law.
REMIC: A "real estate mortgage investment conduit," as such term
is
defined in Section 860D of the Code.
References herein to "a REMIC" or "the
REMICs" shall mean one or all, as the
context requires, of the REMICs created
hereunder.
REMIC POOL: The REMIC created hereunder.
REMIC PROVISIONS: Provisions of the federal income tax law relating
to
REMICs which appear at Sections 860A
through 860G of Part IV of Subchapter M of
Chapter 1 of Subtitle A of the Code, and
related provisions, and U.S. Department
of the Treasury temporary, proposed or
final regulations and rulings promulgated
thereunder, as the foregoing are in effect
(or with respect to proposed
regulations, are proposed to be in effect)
from time to time.
REMITTANCE RATE: 5.50% per annum.
REPURCHASE PROCEEDS: All proceeds of any Mortgage Loan or
property
acquired in respect thereof repurchased
pursuant to Section 2.02, 3.01, 5.01,
5.21 or 11.01.
RESIDUAL INTEREST: The interest represented by (i) amounts, if
any,
remaining in the Collection Account
following termination of the Trust Fund
after payments to the Class A
Certificateholders (other than the Class A-R
Certificateholders), the Class M
Certificateholders and the Class B
Certificateholders and (ii) amounts paid in
respect of principal and accrued
interest on the Class A-R Certificates,
other than, in the case of both (i) and
(ii), amounts attributable to the Class
LT-R Interest.
26
<PAGE>
RESPONSIBLE OFFICER: When used with respect to the Trustee, any
senior
vice president, any vice president, any
assistant vice president, any senior
trust officer, any trust officer or any
other officer of the Trustee in its
Agency & Trust Office customarily
performing functions similar to those
performed by any of the above designated
officers and also, with respect to a
particular matter, any other officer in its
Agency & Trust Office to whom such
matter is referred because of such
officer's knowledge of and familiarity with
the particular subject.
S&P: Standard & Poor's, a division of The McGraw-Hill
Companies, Inc.
or its successor in interest.
SALE AGREEMENT:
The Mortgage Loan Sale Agreement dated as of October 1,
2005 between the Depositor and CHF.
SCHEDULED PRINCIPAL BALANCE: With respect to any Mortgage Loan as
of
any Distribution Date, the unpaid principal
balance of such Mortgage Loan as
specified in the amortization schedule at
the time relating thereto (before any
adjustment to such schedule by reason of
bankruptcy or similar proceeding or any
moratorium or similar waiver or grace
period) as of the Due Date in the month
preceding the month of such Distribution
Date, or as the Cut-off Date, with
respect to the first (1st) Distribution
Date, after giving effect to any
previously applied prepayments, the payment
of principal due on such first day
of the month and any reduction of the
principal balance of such Mortgage Loan by
a bankruptcy court, irrespective of any
delinquency in payment by the related
Mortgagor.
SECTION 302 REQUIREMENTS: Any rules or regulations promulgated
pursuant
to the Sarbanes-Oxley Act of 2002 (as such
may be amended from time to time).
SELLER: CHF.
SERVICER: Chase or any successor under this Agreement as herein
provided.
SERVICING ADVANCES: All customary, reasonable and necessary "out
of
pocket" costs and expenses incurred in the
performance by the Servicer of its
servicing obligations and which are
"unanticipated expenses" (within the meaning
of Treasury regulations section
1.860G-1(b)(3)(ii)) including, but not limited
to, the cost of (i) the preservation,
restoration and protection of the
Mortgaged Property (or Underlying Mortgaged
Property, in the case of a Co-op
Loan), (ii) any enforcement or judicial
proceedings, including foreclosures,
(iii) the management and liquidation of the
Mortgaged Property (or stock
allocated to a dwelling unit, in the case
of a Co-op Loan) if the Mortgaged
Property (or stock allocated to a dwelling
unit, in the case of a Co-op Loan) is
acquired in satisfaction of the Mortgage,
(iv) taxes and assessments on the
Mortgaged Properties subject to the
Mortgage Loans and (v) compliance with the
obligations under Section 5.21.
SERVICING FEE: The amount of the monthly fee paid for the servicing
of
the Mortgage Loans, equal to, as of any
Distribution Date, with respect to each
Mortgage Loan, one-twelfth of the Servicing
Fee Rate of the Principal Balance
thereof as of the Determination Date in the
preceding month, subject to
adjustment as provided in Section 6.05. The
Servicing Fee shall be payable only
at the time of and with respect to those
Mortgage Loans for which payment is in
fact made of the entire amount of the
Monthly Payments that shall have come due
and only at the time such Monthly Payment
shall be made. The right to receive
the Servicing Fee is limited to, and the
Servicing Fee is payable solely from,
the interest portion of such Monthly
Payments (or the interest portion of any
Principal Prepayment in full) collected by
the Servicer, or as otherwise
provided under Section 5.09 or 5.23.
SERVICING FEE RATE: 0.2660% per annum.
SERVICING OFFICER: Any officer of the Servicer or any
Sub-Servicer
involved in, or responsible for, the
administration and servicing of the
Mortgage Loans whose name appears on a
written certificate listing servicing
officers furnished to the Trustee by the
Servicer on or prior to the Closing
Date, and signed on behalf of the Servicer
or any Sub-Servicer by its President,
any Vice President or its Treasurer, as
such certificate may from time to time
be amended.
27
<PAGE>
SFAS 140: Statement of Financial Accounting Standard No. 140,
Accounting for Transfers and Servicing of
Financial Assets and Extinguishment of
Liabilities dated September 2000, published
by the Financial Accounting
Standards Board of the Financial Accounting
Foundation.
SIMILAR LAW: The
meaning specified in Section 4.02(d).
SINGLE CERTIFICATE: A Certificate of any Class that evidences
the
smallest permissible original denomination
for such Class of Certificates as
specified in Section 4.01(d).
SPECIAL HAZARD AMOUNT: Initially, $7,645,211.00. As of the
first
anniversary of the Cut-off Date, the
Special Hazard Amount shall be reduced, but
not increased, to the lesser of (i) the
initial Special Hazard Amount less the
sum of all amounts allocated to the
Subordinated Certificates in respect of
Special Hazard Losses on the Mortgage Loans
during such year or (ii) the
Adjustment Amount for such anniversary. As
of each subsequent anniversary of the
Cut-off Date, the Special Hazard Amount
shall be reduced, but not increased, to
the lesser of (i) the Special Hazard Amount
on the immediately preceding
anniversary of the Cut-off Date less the
sum of all amounts allocated to the
Subordinated Certificates in respect of
Special Hazard Losses on the Mortgage
Loans during such year and (ii) the
Adjustment Amount for such anniversary. The
"Adjustment Amount" with respect to each
anniversary of the Cut-off Date will be
equal to 1.00% multiplied by the aggregate
outstanding Principal Balance of the
Mortgage Loans.
SPECIAL HAZARD LOSS: With respect to any Mortgage Loan, any
Realized
Loss or portion thereof resulting from
direct physical loss or damage to the
related Mortgaged Property (or Underlying
Mortgaged Property, in the case of a
Co-op Loan), which is not insured against
under the Standard Hazard Policy
required to be maintained hereunder.
STANDARD HAZARD POLICY: Each standard hazard insurance policy
or
replacement therefor referred to in Section
5.16.
STARTUP DAY: The meaning specified in Section 2.04(a).
STEP DOWN PERCENTAGE: With respect to any Distribution Date,
the
percentage indicated below:
Distribution Date Occurring in
Step Down Percentage
------------------------------
--------------------
November 2005 through October
2010..................
0%
0%
November 2010 through October
2011..................
30%
30%
November 2011 through October
2012..................
40%
40%
November 2012 through October
2013..................
60%
60%
November 2013 through October
2014..................
80%
80%
November 2014 and
thereafter........................
100%
100%
28
<PAGE>
STRIPPED INTEREST RATE: The excess of the weighted average Net
Mortgage
Rate of the Non-Discount Mortgage Loans
over the Remittance Rate.
SUBORDINATED CERTIFICATES: The Class M and Class B
Certificates,
referred to collectively.
SUBORDINATED OPTIMAL PRINCIPAL AMOUNT: With respect to any
Distribution
Date, the lesser of (a) the aggregate
Outstanding Certificate Principal Balance
of the Subordinated Certificates (before
giving effect to any distributions of
principal on such Distribution Date) and
(b)(i) the sum of the Subordinated
Percentage of the applicable Non-PO
Percentage of the principal portion of all
Monthly Payments, whether or not received,
which were due during the related Due
Period on Mortgage Loans in which were
outstanding during such Due Period; (ii)
the Subordinated Prepayment Percentage of
the applicable Non-PO Percentage of
all Principal Prepayments made on any
Mortgage Loans during the related
Principal Prepayment Period; (iii) with
respect to each Mortgage Loan not
described in (iv) below, the Subordinated
Percentage of the applicable Non-PO
Percentage of the principal portion of all
Insurance Proceeds, condemnation
awards and any other cash proceeds from a
source other than the applicable
Mortgagor, to the extent required to be
deposited in the Collection Account
pursuant to Section 5.08(iv) and (v), which
were received during the related
Principal Prepayment Period, net of related
unreimbursed Servicing Advances and
net of any portion thereof which, as to any
such Mortgage Loan, constitutes Late
Collections that have been the subject of
an Advance on any prior Distribution
Date; (iv) with respect to each Mortgage
Loan which has become a Liquidated
Mortgage Loan during the related Principal
Prepayment Period, an amount equal to
the portion (if any) of the Net Liquidation
Proceeds with respect to such
Liquidated Mortgage Loan (net of any
unreimbursed Advances) that was not
included in the Class A-P Amount or the
Non-PO Class A Optimal Principal Amount
with respect to such Distribution Date; and
(v) with respect to each Mortgage
Loan repurchased or purchased during the
related Principal Prepayment Period
pursuant to Section 2.02, 3.01, 5.01, 5.21
or 11.01, an amount equal to the
Subordinated Prepayment Percentage of the
applicable Non-PO Percentage of the
principal portion of the Purchase Price
(net of amounts with respect to which a
distribution of principal has previously
been made to the Subordinated
Certificateholders) minus (2) the Class A-P
Shortfall Amount with respect to
such Distribution Date.
SUBORDINATED PERCENTAGE: As of any Distribution Date, the
difference
between 100% and the Non-PO Class A
Percentage.
SUBORDINATED PREPAYMENT PERCENTAGE: As of any Distribution Date,
the
difference between 100% and the Non-PO
Class A Prepayment Percentage.
SUB-SERVICER: Any Person with whom the Servicer enters into a
Sub-Servicing Agreement.
SUB-SERVICING
AGREEMENT: Any agreement between the Servicer and any
Sub-Servicer, relating to servicing or
administration of certain Mortgage Loans
as provided in Section 5.02, in such form
as has been approved by the Servicer
and the Depositor.
29
<PAGE>
SUBSEQUENT RECOVERY: The amount, if any, recovered by the Servicer
with
respect to a Liquidated Mortgage Loan with
respect to which a Realized Loss has
been incurred after liquidation and
disposition of such Mortgage Loan.
SUBSTITUTE EXCESS INTEREST: As defined in Section 3.03.
TRUST: The Trust created pursuant to this Agreement.
TRUST FUND: The corpus of the Trust consisting of (i) the
Mortgage
Loans, (ii) such assets as shall from time
to time be identified as deposited in
the Collection Account and the Certificate
Account, (iii) property which secured
a Mortgage Loan and which has been acquired
by foreclosure or deed in lieu of
foreclosure, (iv) Standard Hazard Policies
and any other insurance policies, and
the proceeds thereof and (v) any proceeds
of any of the foregoing.
TRUSTEE: Wachovia Bank, N.A., a national banking association and
its
successors and any corporation resulting
from or surviving any consolidation or
merger to which it or its successors may be
a party, and any successor trustee
at the time serving as successor trustee
hereunder, appointed as herein
provided.
UNCERTIFICATED PRINCIPAL BALANCE: With respect to any Lower-Tier
REMIC
Regular Interest as of any Distribution
Date, the initial principal amount of
such regular interest, reduced by (i) all
amounts distributed on previous
Distribution Dates on such regular interest
with respect to principal and (ii)
the principal portion of all Realized
Losses allocated prior to such
Distribution Date to such regular interest,
and increased with respect to
Subsequent Recoveries as provided in
Section 2.04
U.S. PERSON: A "United States Person" as defined in Section
7701(a)(30)
of the Code.
[END OF ARTICLE I]
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; TRUST FUND
Section 2.01 Conveyance of Mortgage Loans.
The Depositor, concurrently with the
execution and delivery hereof, does hereby
sell, transfer, assign, set over and
convey to the Trustee without recourse all
the right, title and interest of the
Depositor in and to the Mortgage Loans,
including all interest and principal
received on or with respect to the Mortgage
Loans on or after the Cut-off Date
(other than Monthly Payments due on the
Mortgage Loans on or before the Cut-off
Date).
In connection with such assignment, the Depositor does hereby
deliver
to, and deposit with, the Trustee the
following documents or instruments with
respect to each Mortgage Loan so
assigned:
(i) With respect to each Mortgage Loan
which is not a Co-op Loan:
(A) Original Mortgage Note (or a lost note affidavit (including a
copy
of the original Mortgage Note)) or (II)
original consolidation, extension and
modification agreement (or a lost note
affidavit (including a copy of the
original consolidation, extension and
modification agreement)), in either case
endorsed "Pay to the order of Wachovia
Bank, N.A., as trustee, without
recourse".
(B) The original Mortgage (including all riders thereto) with
evidence
of recording thereon, or a copy thereof
certified by the public recording office
in which such Mortgage has been recorded
or, if the original Mortgage has not
been returned from the applicable public
recording office, a true certified
copy, certified by the Seller, of the
original Mortgage together with a
certificate of the Seller certifying that
the original Mortgage has been
delivered for recording in the appropriate
public recording office of the
jurisdiction in which the Mortgaged
Property is located.
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(ii) With respect to each Non-MERS Mortgage
Loan which is not a Co-op Loan:
(A) The original Assignment of Mortgage to "Wachovia Bank, N.A.,
as
trustee (Chase Mortgage Finance
Corporation)," which assignment shall be in form
and substance acceptable for recording, or
a copy certified by the Seller as a
true and correct copy of the original
Assignment of Mortgage which has been sent
for recordation. Subject to the foregoing,
such assignments may, if permitted by
law, be by blanket assignments for Mortgage
Loans covering Mortgaged Properties
situated within the same county. If the
Assignment of Mortgage is in blanket
form, a copy of the Assignment of Mortgage
shall be included in the related
individual Mortgage File.
(B) The original policy of title insurance, including riders
and
endorsements thereto, or if the policy has
not yet been issued, a written
commitment or interim binder or preliminary
report of title issued by the title
insurance or escrow company.
(C) Originals of all recorded intervening Assignments of Mortgage,
or
copies thereof, certified by the public
recording office in which such
Assignments or Mortgage have been recorded
showing a complete chain of title
from the originator to the Depositor, with
evidence of recording, thereon, or a
copy thereof certified by the public
recording office in which such Assignment
of Mortgage has been recorded or, if the
original Assignment of Mortgage has not
been returned from the applicable public
recording office, a true certified
copy, certified by the Seller of the
original Assignment of Mortgage together
with a certificate of the Seller certifying
that the original Assignment of
Mortgage has been delivered for recording
in the appropriate public recording
office of the jurisdiction in which the
Mortgaged Property is located.
(D) Originals, or copies thereof certified by the public
recording
office in which such documents have been
recorded, of each assumption,
extension, modification, written assurance
or substitution agreements, if
applicable, or if the original of such
document has not been returned from the
applicable public recording office, a true
certified copy, certified by the
Seller, of such original document together
with certificate of Seller certifying
the original of such document has been
delivered for recording in the
appropriate recording office of the
jurisdiction in which the Mortgaged Property
is located.
(E) If the Mortgage Note or Mortgage or any other material document
or
instrument relating to the Mortgage Loan
has been signed by a Person on behalf
of the Mortgagor, the original power of
attorney or other instrument that
authorized and empowered such Person to
sign bearing evidence that such
instrument has been recorded, if so
required in the appropriate jurisdiction
where the Mortgaged Property is located
(or, in lieu thereof, a duplicate or
conformed copy of such instrument, together
with a certificate of receipt from
the recording office, certifying that such
copy represents a true and complete
copy of the original and that such original
has been or is currently submitted
to be recorded in the appropriate
governmental recording office of the
jurisdiction where the Mortgaged Property
is located), or if the original power
of attorney or other such instrument has
been delivered for recording in the
appropriate public recording office of the
jurisdiction in which the Mortgaged
Property is located.
(iii) With respect to each Co-op Loan:
(A) (I) The
original Mortgage Note (or a lost note affidavit
(including a copy of the original Mortgage Note)) or (II)
original consolidation, extension and modification agreement
(or a lost note affidavit (including a copy of the original
consolidation, extension and modification agreement)), in
either case endorsed "Pay to the order of Wachovia Bank, N.A.,
as trustee, without recourse."
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<PAGE>
(B) The
original Mortgage entered into by the Mortgagor with
respect to such Co-Op Loan.
(C) The
original Assignment of Mortgage to "Wachovia Bank, N.A. as
trustee (Chase Mortgage Finance Corporation)".
(D) Original
assignments of Mortgage showing a complete chain of
assignment from the
originator of the related Co-Op Loan to
the Seller.
(E) Original
Form UCC-1 and any continuation statements with
evidence of filing thereon entered into by the Mortgagor with
respect to such Co-Op Loan.
(F) Form UCC-3
(or copy thereof) by the applicable Mortgage Loan
Seller or its agent assigning the security interest covered by
such Form UCC-1 to "Wachovia Bank, N.A. as trustee", together
with all Forms UCC-3 (or copies thereof) showing a complete
chain of assignment from the originator of the related Co-op
Loan to the Seller, with evidence of recording thereon.
(G) Stock
certificate representing the stock allocated to the
related dwelling unit in the related residential cooperative
housing corporation and pledged by the related Mortgagor to
the originator of such Co-op Loan with a stock power in blank
attached.
(H) Original
proprietary lease.
(I) Original
assignment of proprietary lease, to the Trustee, and
all intervening assignments thereof.
(J) Original
recognition agreement of the interests of the
mortgagee with respect to the Co-op Loan by the residential
cooperative housing corporation, the stock of which was
pledged by the related Mortgagor to the originator of such
Co-op Loan.
(K) Originals
of any assumption, consolidation or modification
agreements relating to any of the items specified in (A)
through (F)
above with respect to such Co-op Loan.
If in connection with any Mortgage Loan which is not a Co-op Loan
the
Depositor cannot deliver the Mortgage,
Assignments of Mortgage, or assumption,
consolidation or modification agreement, as
the case may be, with evidence of
recording thereon concurrently with the
execution and delivery of this Agreement
solely because of a delay caused by the
public recording office where such
Mortgage, Assignments of Mortgage, or
assumption, consolidation or modification
agreement, as the case may be, has been
delivered for recordation, the Depositor
shall deliver or cause to be delivered to
the Trustee written notice stating
that such Mortgage, Assignments of
Mortgage, or assumption, consolidation or
modification agreement, as the case may be,
has been delivered to the
appropriate public recording office for
recordation. Thereafter, the Depositor
shall deliver or cause to be delivered to
the Trustee such Mortgage, Assignments
of Mortgage, or assumption, consolidation
or modification agreement, as the case
may be, with evidence of recording
indicated thereon upon receipt thereof from
the public recording office.
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<PAGE>
With respect to any Non-MERS Mortgage Loans which are not Co-op
Loans,
and as to which the related Mortgaged
Property is located in Florida, the
Servicer shall cause to be recorded in the
appropriate public recording office
for real property records each Assignment
of Mortgage referred to in this
Section 2.01 as soon as practicable. With
respect to any Non-MERS Mortgage Loans
which are not Co-op Loans as to which the
related Mortgaged Property is located
outside of Florida, the Servicer shall not
be obligated to cause to be recorded
the Assignment of Mortgage referred to in
this Section 2.01. With respect to
Co-op Loans as to which the related
dwelling unit is located in Florida, the
Servicer shall cause to be filed in the
appropriate filing office the Form UCC-3
referred to in this Section 2.01 as soon as
practicable. With respect to any
Co-op Loans as to which the related
dwelling unit is located outside Florida,
the Servicer shall not be obligated to
cause to be filed the Form UCC-3 referred
to in this Section 2.01. While each such
Assignment of Mortgage or Form UCC-3 is
being recorded or filed, as applicable, the
Servicer shall deliver to the
Trustee a photocopy of such document. If
any such Assignment of Mortgage or Form
UCC-3 is returned unrecorded or unfiled to
the Servicer because of any defect
therein, the Servicer shall cause such
defect to be cured and such document to
be recorded or filed in accordance with
this paragraph. The Depositor shall
deliver or cause to be delivered each such
original recorded or filed Assignment
of Mortgage and intermediate assignment or
Form UCC-3 to the Trustee within 270
days of the Closing Date or shall deliver
to the Trustee on or before such date
an Officer's Certificate stating that such
document has been delivered to the
appropriate public recording or filing
office for recording or filing, but has
not been returned solely because of a delay
caused by such recording or filing
office. In any event, the Depositor shall
use all reasonable efforts to cause
each such document with evidence of
recording or filing thereon to be delivered
to the Trustee within 300 days of the
Closing Date.
With respect to each MERS Mortgage Loan, the Trustee, at the
expense of
the Depositor and at the direction and with
the cooperation of the Servicer,
shall cause to be taken such actions as are
necessary to cause the Trustee to be
clearly identified as the owner of each
such Mortgage Loan on the records of
MERS for purposes of the system of
recording transfers of beneficial ownership
of mortgages maintained by MERS.
The ownership of
each Mortgage Note, the Mortgage and the contents of
the related Mortgage File is vested in the
Trustee. Neither the Depositor nor
the Servicer shall take any action
inconsistent with such ownership and shall
not claim any ownership interest therein.
The Depositor and the Servicer shall
respond to any third party inquiries with
respect to ownership of the Mortgage
Loans by stating that such ownership is
held by the Trustee on behalf of the
Certificateholders. Mortgage documents
relating to the Mortgage Loans not
delivered to the Trustee are and shall be
held in trust by the Servicer or any
Sub-Servicer, for the benefit of the
Trustee as the owner thereof, and the
Servicer's or such Sub-Servicer's
possession of the contents of each Mortgage
File so retained is for the sole purpose of
servicing the related Mortgage Loan,
and such retention and possession by the
Servicer or such Sub-Servicer is in a
custodial capacity only. The Depositor
agrees to take no action inconsistent
with the Trustee's ownership of the
Mortgage Loans, to promptly indicate to all
inquiring parties that the Mortgage Loans
have been sold and to claim no
ownership interest in the Mortgage Loans.
Each Mortgage File and the mortgage
documents relating to the Mortgage Loans
contain proprietary business
information of the Servicer and its
customers. The Trustee and the Depositor
agree that they will not use such
information for business purposes without the
express written consent of the Servicer and
that all such information shall be
kept strictly confidential.
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<PAGE>
It is the intention of this Agreement that the conveyance of
the
Depositor's right, title and interest in
and to the Trust Fund pursuant to this
Agreement shall constitute a purchase and
sale and not a loan. If a conveyance
of Mortgage Loans from the Seller to the
Depositor is characterized as a pledge
and not a sale, then the Depositor shall be
deemed to have transferred to the
Trustee all of the Depositor's right, title
and interest in, to and under the
obligations of the Seller deemed to be
secured by said pledge; and it is the
intention of this Agreement that the
Depositor shall also be deemed to have
granted to the Trustee a first priority
security interest in all of the
Depositor's right, title, and interest in,
to and under the obligations of the
Seller to the Depositor deemed to be
secured by said pledge and that the Trustee
shall be deemed to be an independent
custodian for purposes of perfection of the
security interest granted to the Depositor.
If the conveyance of the Mortgage
Loans from the Depositor to the Trustee is
characterized as a pledge, it is the
intention of this Agreement that this
Agreement shall constitute a security
agreement under applicable law, and that
the Depositor shall be deemed to have
granted to the Trustee a first priority
security interest in all of the
Depositor's right, title and interest in,
to and under the Mortgage Loans, all
payments of principal of or interest on
such Mortgage Loans, all other rights
relating to and payments made in respect of
the Trust Fund, and all proceeds of
any thereof. If the trust created by this
Agreement terminates prior to the
satisfaction of the claims of any Person in
any Certificates, the security
interest created hereby shall continue in
full force and effect and the Trustee
shall be deemed to be the collateral agent
for the benefit of such Person.
In addition to the conveyance made in the first paragraph of
this
Section 2.01, the Depositor does hereby
convey, assign and set over to the
Trustee all of its right, title and
interest in that portion of the Trust Fund
described in items (ii), (iii), (iv) and
(v) of the definition thereof and
further assigns to the Trustee for the
benefit of the Certificateholders those
representations and warranties of the
Seller contained in the Sale Agreement and
described in Section 3.01 hereof and the
benefit of the repurchase obligations
of the Seller described in Sections 2.02
and 3.01 hereof and the obligations of
the Seller contained in the Sale Agreement
to take, at the request of the
Depositor or the Trustee, all action on its
part which is reasonably necessary
to ensure the enforceability of a Mortgage
Loan.
The parties hereto agree and understand that it is not intended
that
any mortgage loan be included in the Trust
that is any of (i) a "High-Cost Home
Loan" as defined in the New Jersey Home
Ownership Act effective November 27,
2003, (ii) a "High-Cost Home Loan" as
defined in the New Mexico Home Loan
Protection Act effective January 1, 2004,
(iii) a "High-Cost Home Mortgage Loan"
as defined in the Massachusetts Predatory
Home Loan Practices Act effective
November 7, 2004 or (iv) a "High-Cost Home
Loan" as defined by the Indiana High
Cost Home Loan Law effective January 1,
2005.
Section 2.02 Acceptance by Trustee. Except as set forth in the
Exception Report delivered
contemporaneously herewith (the "Exception Report"),
the Trustee acknowledges receipt of the
Mortgage Note for each Mortgage Loan and
delivery of a Mortgage File (but does not
acknowledge receipt of all documents
required to be included in such Mortgage
File) with respect to each Mortgage
Loan and declares that it holds and will
hold such documents and any other
documents constituting a part of the
Mortgage Files delivered to it in trust for
the use and benefit of all present and
future Certificateholders. The Depositor
will cause the Seller to repurchase any
Mortgage Loans to which an exception was
taken in the Exception Report unless such
exception is cured to the satisfaction
of the Trustee within 45 Business Days of
the Closing Date.
The Trustee agrees, for the benefit of Certificateholders, to
review
each Mortgage File delivered to it within
270 days after the Closing Date to
ascertain that all documents required by
Section 2.01 have been executed and
received, and that such documents relate to
the Mortgage Loans identified in
Exhibit A that have been conveyed to it. If
the Trustee finds any document or
documents constituting a part of a Mortgage
File to be missing or defective
(that is, mutilated, damaged, defaced or
unexecuted) in any material respect,
the Trustee shall promptly (and in any
event within no more than five Business
Days) after such finding so notify the
Servicer, the Seller and the Depositor.
In addition, the Trustee shall also notify
the Servicer, the Seller and the
Depositor, if (a) in examining the Mortgage
Files, the documentation shows on
its face (i) any adverse claim, lien or
encumbrance, (ii) that any Mortgage Note
was overdue or had been dishonored, (iii)
any evidence on the face of any
Mortgage Note or Mortgage of any security
interest or other right or interest
therein, or (iv) any defense against or
claim to the Mortgage Note by any party
or (b) the original Mortgage with evidence
of recording thereon with respect to
34
<PAGE>
a Mortgage Loan is not received within 270
days of the Closing Date; provided,
however, that if the Depositor cannot
deliver the original Mortgage with
evidence of recording thereon because of a
delay caused by the public recording
office where such Mortgage has been
delivered for recordation, the Depositor
shall deliver or cause to be delivered to
the Trustee written notice stating
that such Mortgage has been delivered to
the appropriate public recording
officer for recordation and thereafter the
Depositor shall deliver or cause to
be delivered such Mortgage with evidence of
recording thereon upon receipt
thereof from the public recording office.
The Trustee shall request that the
Seller correct or cure such omission,
defect or other irregularity, or
substitute a Mortgage Loan pursuant to the
provisions of Section 3.03, within 60
days from the date the Seller was notified
of such omission or defect and, if
the Seller does not correct or cure such
omission or defect within such period,
that the Seller purchase such Mortgage Loan
from the Trustee within 90 days from
the date the Trustee notified the Seller of
such omission, defect or other
irregularity at the Purchase Price of such
Mortgage Loan. The Purchase Price for
any Mortgage Loan purchased pursuant to
this Section 2.02 shall be paid to the
Servicer and deposited by the Servicer in
the Collection Account promptly upon
receipt, and, upon receipt by the Trustee
of written notification of such
deposit signed by a Servicing Officer, the
Trustee shall promptly release to the
Seller the related Mortgage File and the
Trustee shall execute and deliver such
instruments of transfer or assignment,
without recourse, as shall be necessary
to vest in the Seller or its designee, as
the case may be, any Mortgage Loan
released pursuant hereto, and the Trustee
shall have no further responsibility
with regard to such Mortgage Loan. It is
understood and agreed that the
obligation of the Seller to purchase, cure
or substitute any Mortgage Loan as to
which a material defect in or omission of a
constituent document exists shall
constitute the sole remedy respecting such
defect or omission available to the
Trustee on behalf of Certificateholders.
The Trustee shall be under no duty or
obligation to inspect, review and examine
such documents, instruments,
certificates or other papers to determine
that they are genuine, enforceable or
appropriate to the represented purpose, or
that they have actually been
recorded, or that they are other than what
they purport to be on their face. The
Trustee shall keep confidential the name of
each Mortgagor and shall not solicit
any such Mortgagor for the purpose of
refinancing the related Mortgage Loan.
Within 280 days of the Closing Date, the Trustee shall deliver to
the
Depositor and the Servicer the Trustee's
Certification, substantially in the
form of Exhibit G attached hereto, setting
forth the status of the Mortgage
Files as of such date.
Section 2.03 Trust Fund; Authentication of Certificates. The
Trustee
acknowledges and accepts the assignment to
it of the Trust Fund created pursuant
to this Agreement in trust for the use and
benefit of all present and future
Certificateholders. The Trustee
acknowledges the assignment to it for the
benefit of the Trust Fund of the Mortgage
Loans and has caused to be
authenticated and delivered to or upon the
order of the Depositor, in exchange
for the Mortgage Loans, Certificates duly
authenticated by the Trustee or, if an
Authenticating Agent has been appointed
pursuant to Section 4.06, the
Authenticating Agent in authorized
denominations evidencing ownership of the
entire Trust Fund.
Section 2.04 REMIC Elections.
(a) The Depositor hereby instructs and authorizes the Servicer,
on
behalf of the Trust Fund, to make
appropriate elections to treat the Trust Fund
as comprising a REMIC. This Agreement shall
be construed so as to carry out the
intention of the parties that each REMIC
created hereunder be treated as a REMIC
at all times prior to the date on which the
Trust Fund is terminated. The
Closing Date is hereby designated as the
"startup day" of each REMIC created
hereunder within the meaning of Section
860G(a)(9) of the Code. The REMIC shall
hold as assets all property of the Trust
Fund. Each of the Classes of
Certificates (other than the Class A-R
Certificates) is hereby designated as a
"regular interest" (within the meaning of
Section 860G(a)(1) of the Code) in the
REMIC. The Residual Interest is hereby
designated as the sole residual interest
(within the meaning of Section 860G(a)(2)
of the Code) in the REMIC. The Class
A-R Certificate evidences ownership of the
Residual Interest. All interests
described in this Section 2.04(a) shall be
designated as such on the Startup
Day.
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<PAGE>
(b) Solely for the purposes of Section 1.860G-1(a)(4)(iii) of
the
Treasury Regulations, the "latest possible
maturity date" of each "regular
interest" in each REMIC created hereunder
is the Distribution Date immediately
following the latest scheduled maturity of
any Mortgage Loan.
(c) The "tax matters person" with respect to each REMIC created
hereunder for purposes of the REMIC
Provisions shall be the beneficial owner of
the Class A-R Certificate having the
largest Percentage Interest of such Class;
provided, however, that such largest
beneficial owner and, to the extent
relevant, each other Holder of a Class A-R
Certificate, by its acceptance
thereof, irrevocably appoints the Servicer
as its agent and attorney-in-fact to
act as "tax matters person" with respect to
each REMIC created hereunder for
purposes of the REMIC provisions.
(d) It is intended that each REMIC created hereunder shall
constitute,
and that the affairs of the Trust Fund
shall be conducted so as to qualify each
REMIC created hereunder as, a "real estate
mortgage investment conduit" as
defined in and in accordance with the REMIC
Provisions. In furtherance of such
intention, the Servicer covenants and
agrees that it shall act as agent (and the
Servicer is hereby appointed to act as
agent) on behalf of the Trust Fund, each
REMIC created hereunder and the Holder of
the Class A-R Certificate and that in
such capacity it shall:
(i) prepare and file, or cause to be prepared and filed, in a
timely manner, a U.S. Real Estate Mortgage Investment Conduit
Income
Tax Return (Form 1066) for each REMIC created hereunder and prepare
and
file or cause to be prepared and filed with the Internal
Revenue
Service and applicable state or local tax authorities income tax
or
information returns for each taxable year with respect to each
REMIC
created hereunder, using the calendar year as the taxable year and
the
accrual method of accounting, containing such information and at
the
times and in the manner as may be required by the Code or state
or
local tax laws, regulations, or rules, and shall furnish or cause
to be
furnished to Certificateholders the schedules, statements or
information at such times and in such manner as may be required
thereby;
(ii) within thirty days of the Closing Date, shall furnish or
cause to be furnished to the Internal Revenue Service, on Form 8811
or
as otherwise may be required by the Code, the name, title, address,
and
telephone number of the person that the holders of the Certificates
may
contact for tax information relating thereto (and the Servicer
shall
act as the representative of the Trust Fund for this purpose),
together
with such additional information as may be required by such Form,
and
shall update such information at the time or times in the
manner
required by the Code;
(iii) make or cause to be made an election, on behalf of each
REMIC created hereunder, to be treated as a REMIC, and make the
appropriate designations, if applicable, in accordance with
this
Section 2.04 on the federal tax return of each REMIC hereunder for
its
first taxable year (and, if necessary, under applicable state
law);
(iv) prepare and forward, or cause to be prepared and
forwarded, to the Certificateholders and to the Internal
Revenue
Service and, if necessary, state tax authorities, all
information
returns or reports, or furnish or cause to be furnished by
telephone,
mail, publication or other appropriate method such information, as
and
when required to be provided to them in accordance with the
REMIC
Provisions, including without limitation, the calculation of
any
original issue discount;
(v) provide information necessary for the computation of tax
imposed on the transfer of the Class A-R Certificate to a
Disqualified
Organization, or an agent (including a broker, nominee or other
middleman) of a Disqualified Organization, or a pass-through entity
in
which a Disqualified Organization is the record holder of an
interest
(the reasonable cost of computing and furnishing such information
may
be charged to the Person liable for such tax);
36
<PAGE>
(vi) ensure that federal, state or local income tax or
information returns shall be signed by the Trustee or such other
Person
as may be required to sign such returns by the Code or state or
local
laws, regulations or rules; and
(vii) maintain such records relating to each REMIC created
hereunder as may be required by the Code and as may be necessary
to
prepare the foregoing returns, schedules, statements or
information.
(e) Pursuant to Section 6.02(b), the Servicer, with the consent of
the
Trustee, hereby appoints the Institution
Trust Services Department of Chase to
perform the duties enumerated in (d)
above.
Section 2.05 Permitted Activities of Trust. The Trust is created
for
the object and purpose of engaging in the
Permitted Activities.
Section 2.06 Qualifying Special Purpose Entity. For purposes of
SFAS
140, the parties hereto intend that the
Trust shall be treated as a "qualifying
special purpose entity" as such term is
used in SFAS 140 and any successor rule
thereto and its power and authority as
stated in Section 2.05 of this Agreement
shall be limited in accordance with
paragraph 35 thereof.
[END OF ARTICLE II]
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR AND
THE SERVICER; REPURCHASE OF MORTGAGE LOANS
Section 3.01 Representations and Warranties of the Depositor
with
respect to the Mortgage Loans.
The Depositor hereby represents and warrants to the Trustee for
the
benefit of the Certificateholders that on
the Closing Date it has entered into
the Sale Agreement with CHF as Seller, that
the Seller has made the following
representations and warranties with respect
to each Mortgage Loan in the Sale
Agreement as of the Closing Date, which
representations and warranties run to
and are for the benefit of the Depositor
and the Trustee for the benefit of the
Certificateholders, and as to which the
Depositor has assigned to the Trustee
for the benefit of the Certificateholders,
pursuant to Section 2.01 hereof, the
right to cause the Seller to repurchase a
Mortgage Loan as to which there has
occurred an uncured breach of
representations and warranties in accordance with
the provisions of the Sale Agreement.
(a) The information set forth in the Mortgage Loan Schedule is
complete, true and correct in all material
respects;
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<PAGE>
(b) With respect to a Mortgage Loan which is not a Co-op Loan,
the
Mortgage creates a first lien or a first
priority ownership interest in an
estate in fee simple in real property
securing the related Mortgage Note. With
respect to a Co-op Loan, the related
Mortgage is a valid, enforceable and
subsisting first security interest on the
related cooperative shares securing
the related Mortgage Note, subject only to
(a) liens of the related residential
cooperative housing corporation for unpaid
assessments representing the
Mortgagor's pro rata share of the related
residential cooperative housing
corporation's payments for its blanket
mortgage, current and future real
property taxes, insurance premiums,
maintenance fees and other assessments to
which like collateral is commonly subject
and (b) other matters to which like
collateral is commonly subject which do not
materially interfere with the
benefits of the security intended to be
provided by the related security
agreement. There are no liens against or
security interest in the cooperative
shares relating to each Co-op Loan (except
for unpaid maintenance, assessments
and other amounts owed to the related
cooperative which individually or in the
aggregate will not have a material adverse
effect on such Co-op Loan), which
have priority over the Trustee's security
interest in such cooperative shares;
(c) All payments due prior to the Cut-off Date for such Mortgage
Loan
have been made as of the Closing Date, the
Mortgage Loan is not delinquent in
payment more than 30 days and has not been
dishonored; to the best of the
Seller's knowledge, there are no material
defaults under the terms of the
Mortgage Loan; the Seller has not advanced
funds, or induced, solicited or
knowingly received any advance of funds
from a party other than the owner of the
Mortgaged Property subject to the Mortgage
(or, with respect to a Co-op Loan,
the related Mortgagor), directly or
indirectly, for the payment of any amount
required by the Mortgage Loan; there has
been no more than one delinquency in
excess of 30 days during the preceding
twelve-month period;
(d) To the best of the Seller's knowledge, all taxes,
governmental
assessments, insurance premiums, water,
sewer and municipal charges, leasehold
payments or ground rents which previously
became due and owing have been paid,
or escrow funds have been established in an
amount sufficient to pay for every
such escrowed item which remains unpaid and
which has been assessed but is not
yet due and payable;
(e) The terms of the Mortgage Note and the Mortgage have not
been
impaired, waived, altered or modified in
any respect, except by written
instruments. No Mortgagor has been
released, in whole or in part, from the terms
thereof except in connection with an
assumption agreement and which assumption
agreement is part of the Mortgage File and
the terms of which are reflected in
the Mortgage Loan Schedule;
(f) The Mortgage Note and the Mortgage are not subject to any right
of
rescission, set-off, counterclaim or
defense, including, without limitation, the
defense of usury, nor will the operation of
any of the terms of the Mortgage
Note or Mortgage, or the exercise of any
right thereunder, render the Mortgage
Note or Mortgage unenforceable, in whole or
in part, or subject to any right of
rescission, set-off, counterclaim or
defense, including the defense of usury,
and no such right of rescission, set-off,
counterclaim or defense has been
asserted with respect thereto, and the
Mortgagor was not a debtor in any state
or federal bankruptcy or insolvency
proceeding at the time the Mortgage Loan was
originated;
(g) With respect to a Mortgage Loan which is not a Co-op Loan,
all
buildings or other customarily insured
improvements upon the Mortgaged Property
are insured by an insurer acceptable under
the FNMA Guides against loss by fire,
hazards of extended coverage and such other
hazards as are provided for in the
FNMA Guides or by FHLMC. All such standard
hazard policies are in full force and
effect and on the date of origination
contained a standard mortgagee clause
naming the Seller and its successors in
interest and assigns as loss payee and
such clause is still in effect and all
premiums due thereon have been paid. If
required by the Flood Disaster Protection
Act of 1973, as amended, the Mortgaged
Property is covered by a flood insurance
policy meeting the requirements of the
current guidelines of the Federal Insurance
Administration which policy conforms
to FNMA and FHLMC requirements. The
Mortgage obligates the Mortgagor thereunder
to maintain all such insurance at the
Mortgagor's cost and expense, and on the
Mortgagor's failure to do so, authorizes
the holder of the Mortgage to maintain
such insurance at the Mortgagor's cost and
expense and to seek reimbursement
therefor from the Mortgagor;
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(h) Any and all requirements of any federal, state or local laws
and
all applicable predatory and abusive
lending laws, including, without
limitation, usury, truth-in-lending, real
estate settlement procedures, consumer
credit protection, equal credit opportunity
or disclosure laws applicable to the
Mortgage Loan have been complied with in
all material respects;
(i) The Mortgage has not been satisfied, canceled or subordinated,
in
whole or in part, or rescinded, and the
Mortgaged Property has not been released
from the lien of the Mortgage, in whole or
in part nor has any instrument been
executed that would effect any such
release, cancellation, subordination or
rescission;
(j) With respect to a Mortgage Loan which is not a Co-op Loan,
the
Mortgage is a valid, subsisting,
enforceable and perfected first lien on the
Mortgaged Property, including, all
buildings on the Mortgaged Property. The
Mortgage and the Mortgage Note do not
contain any evidence of any security
interest or other interest or right
thereto. Such lien is free and clear of all
adverse claims, liens and encumbrances
having priority over the first lien of
the Mortgage subject only to (1) the lien
of non-delinquent current real
property taxes and assessments not yet due
and payable, (2) covenants,
conditions and restrictions, rights of way,
easements and other matters of the
public record as of the date of recording
which are acceptable to mortgage
lending institutions generally and either
(A) which are referred to or otherwise
considered in the appraisal made for the
originator of the Mortgage Loan, or (B)
which do not adversely affect the Appraised
Value of the Mortgaged Property as
set forth in such appraisal, and (3) other
matters to which like properties are
commonly subject which do not materially
interfere with the benefits of the
security intended to be provided by the
Mortgage or the use, enjoyment, value or
marketability of the related Mortgaged
Property. Any security agreement, chattel
mortgage or equivalent document related to
and delivered in connection with the
Mortgage Loan establishes and creates a
valid, subsisting, enforceable and
perfected first lien and first priority
security interest on the property
described therein, and the Depositor has
the full right to sell and assign the
same to the Trustee for the benefit of the
Certificateholders;
(k) The Mortgage Note and the related Mortgage are original and
genuine
and each is the legal, valid and binding
obligation of the maker thereof,
enforceable in all respects in accordance
with its terms subject to bankruptcy,
insolvency and other laws of general
application affecting the rights of
creditors and the Depositor has taken all
action necessary to transfer such
rights of enforceability to the Trustee for
the benefit of the
Certificateholders. All parties to the
Mortgage Note and the Mortgage had the
legal capacity to enter into the Mortgage
Loan and to execute and deliver the
Mortgage Note and the Mortgage. The
Mortgage Note and the Mortgage have been
duly and property executed by such parties.
The proceeds of the Mortgage Loan
have been fully disbursed and there is no
requirement for future advances
thereunder, and any and all requirements as
to completion of any on-site or
off-site improvements and as to
disbursements of any escrow funds therefor have
been complied with;
(l) The Seller is the sole owner and holder of the Mortgage Loan
and
the indebtedness evidenced by the Mortgage
Note, except for the Assignments of
Mortgage which have been sent for
recording, and upon recordation the Seller
will be the owner of record of the Mortgage
and the indebtedness evidenced by
the Mortgage Note, and upon the sale of the
Mortgage Loan to the Trust for the
benefit of the Certificateholders, the
Seller will retain the Mortgage File or
any part thereof with respect thereto not
delivered to the Trust for the benefit
of the Certificateholders or its designee
in trust only for the purpose of
servicing and supervising the servicing of
the Mortgage Loan. Immediately prior
to the transfer and assignment to the Trust
for the benefit of the
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Certificateholders, the Mortgage Loan,
including the Mortgage Note and the
Mortgage, were not subject to an assignment
or pledge, and the Depositor had
good and marketable title to and was the
sole owner thereof and had full right
to transfer and sell the Mortgage Loan to
the Trustee for the benefit of the
Certificateholders free and clear of any
encumbrance, equity, lien, pledge,
charge, claim or security interest and has
the full right and authority subject
to no interest or participation of, or
agreement with, any other party, to sell
and assign the Mortgage Loan pursuant to
this Agreement and following the sale
of the Mortgage Loan, the Trustee for the
benefit of the Certificateholders will
own such Mortgage Loan free and clear of
any encumbrance, equity, participation
interest, lien, pledge, charge, claim or
security interest;
(m) With respect to a Mortgage Loan which is not a Co-op Loan,
the
Mortgage Loan is covered by an ALTA
lender's title insurance policy or other
generally acceptable form of policy or
insurance acceptable to FNMA or FHLMC,
issued by a title insurer acceptable to
FNMA or FHLMC and qualified to do
business in the jurisdiction where the
Mortgaged Property is located, insuring
(subject to the exceptions contained in (j)
(1), (2) and (3) above) the Seller,
its successors and assigns, as to the first
priority lien of the Mortgage in the
original principal amount of the Mortgage
Loan. Such lender's title insurance
policy insures ingress and egress by or
upon the Mortgaged Property or any
interest therein. Where required by state
law or regulation, the Mortgagor has
been given the opportunity to choose the
carrier of the required mortgage title
insurance. The Seller, its successors and
assigns, are the sole insureds of such
lender's title insurance policy, and such
lender's title insurance policy is in
full force and effect and will be in full
force and effect upon the consummation
of the transactions contemplated by this
Agreement. No claims have been made
under such lender's title insurance policy,
and no prior holder of the related
Mortgage, including the Seller, has done,
by act or omission, anything which
would impair the coverage of such lender's
title insurance policy;
(n) There is no default, breach, violation or event of
acceleration
existent, under the Mortgage or the related
Mortgage Note and no event which,
with the passage of time or with notice and
the expiration of any grace or cure
period, would constitute a default, breach,
violation or event permitting
acceleration; and neither the Seller nor
any prior mortgagee has waived any
default, breach, violation or event
permitting acceleration;
(o) There are no mechanics', or similar liens or claims which have
been
filed for work, labor or material (and no
rights are outstanding that under law
could give rise to such liens) affecting
the related Mortgaged Property (or the
related residential dwelling unit in the
Underlying Mortgage Property, in the
case of a Co-op Loan) which are or may be
liens prior to or equal to the lien of
the related Mortgage;
(p) With respect to a Mortgage Loan which is not a Co-op Loan,
all
improvements subject to the Mortgage which
were considered in determining the
Appraised Value of the Mortgaged Property
lie wholly within the boundaries and
building restriction lines of the Mortgaged
Property (and wholly within the
project with respect to a condominium unit)
and no improvements on adjoining
properties encroach upon the Mortgaged
Property except those which are insured
against by the title insurance policy
referred to in clause (m) above and all
improvements on the property comply with
all applicable zoning and subdivision
laws and ordinances; the Mortgaged Property
is lawfully occupied under
applicable law;
(q) The Mortgage Loan complies in all material respects with all
the
terms, conditions and requirements of the
Seller's underwriting standards in
effect at the time of origination of such
Mortgage Loan. The Mortgage Notes and
Mortgages (exclusive of any riders) are on
forms generally acceptable to FNMA or
FHLMC. Monthly Payments under the Mortgage
Note are due and payable on the first
day of each month. The Mortgage contains
the usual and enforceable provisions of
the originator at the time of origination
for the acceleration of the payment of
the unpaid principal amount of the Mortgage
Loan if the related Mortgaged
Property is sold without the prior consent
of the mortgagee thereunder;
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<PAGE>
(r) The Mortgaged Property (or Underlying Mortgaged Property, in
the
case of a Co-op Loan), is not subject to
any material damage by waste, fire,
earthquake, windstorm, flood or other
casualty. To the best of the Seller's
knowledge, at origination of the Mortgage
Loan there was, and there currently
is, no proceeding pending for the total or
partial condemnation of the Mortgaged
Property (or Underlying Mortgaged Property,
in the case of a Co-op Loan);
(s) The related Mortgage contains customary and enforceable
provisions
such as to render the rights and remedies
of the holder thereof adequate for the
realization against the Mortgaged Property
of the benefits of the security
provided thereby, including, (l) in the
case of a Mortgage designated as a deed
of trust, by trustee's sale, and (2)
otherwise by judicial foreclosure. There is
no homestead or other exemption available
to the Mortgagor which would interfere
with the right to sell the Mortgaged
Property at a trustee's sale or the right
to foreclose the Mortgage subject to
applicable federal and state laws and
judicial precedent with respect to
bankruptcy and right of redemption or similar
law;
(t) If the Mortgage constitutes a deed of trust, a trustee,
authorized
and duly qualified if required under
applicable law to act as such, has been
properly designated and currently so serves
and is named in the Mortgage, and no
fees or expenses, except as may be required
by local law, are or will become
payable by the Purchaser to the trustee
under the deed of trust, except in
connection with a trustee's sale or
attempted sale after default by the
Mortgagor;
(u) The Mortgage File contains an appraisal or a
recertification
document (in the case of a Mortgage Loan
originated under the Seller's
Streamlined Refinance Program) of the
related Mortgaged Property (or the related
residential dwelling unit in the Underlying
Mortgaged Property, in the case of a
Co-op Loan), signed prior to the final
approval of the mortgage loan application
by an appraiser approved by the Seller who
had no interest, direct or indirect,
in the Mortgaged Property (or Underlying
Mortgaged Property, in the case of a
Co-op Loan), or in any loan made on the
security thereof, and whose compensation
is not affected by the approval or
disapproval of the Mortgage Loan. The
appraisal is in a form acceptable to FNMA
or FHLMC; (v) All parties which have
had any interest in the Mortgage, whether
as mortgagee, assignee, pledgee or
otherwise, are (or, during the period in
which they held and disposed of such
interest, were) (A) in substantial
compliance with any and all applicable
licensing requirements of the laws of the
state wherein the Mortgaged Property
(or Underlying Mortgaged Property, in the
case of a Co-op Loan), is located, and
(B) (1) organized under the laws of such
state, or (2) qualified to do business
in such state, or (3) federal savings and
loan associations or national banks or
a Federal Home Loan Bank or savings bank
having principal offices in such state,
or (4) not doing business in such
state;
(w) The related Mortgage Note is not and has not been secured by
any
collateral except the lien of the
corresponding Mortgage and the security
interest of any applicable security
interest of any applicable agreement or
chattel mortgage referred to above and such
collateral does not serve as
security for any other obligation;
(x) The Mortgagor has received all disclosure materials required
by
applicable law with respect to the making
of such mortgage loans;
(y) The Mortgage Loan does not contain "graduated payment"
features;
(z) The Mortgagor is not in bankruptcy and, to the best of the
Seller's
knowledge, the Mortgagor is not
insolvent;
(aa) The Mortgage Loans are fixed rate mortgage loans. Each
Mortgage
Loan has an original term to maturity of
not more than thirty (30) years with
interest payable in arrears on the first
day of each month. Each Mortgage Note
is payable in equal monthly installments of
principal and interest which are
sufficient to amortize the Mortgage Loan
fully by the stated maturity date. No
Mortgage Loan contains terms or provisions
which would result in negative
amortization;
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(bb) Each Mortgage Note, each Mortgage, each Assignment of Mortgage
and
any other documents required pursuant to
this Agreement to be delivered to the
Trustee on behalf of the Certificateholders
or its designee, or its assignee for
each Mortgage Loan, have been, on or before
the Closing Date, delivered to the
Trustee on behalf of the Certificateholders
or its designee, or its assignee;
(cc) All escrow payments have been collected in full compliance
with
state and federal law and the provisions of
the related Mortgage Note and
Mortgage. As to any Mortgage Loan that is
the subject of an escrow, escrow of
funds is not prohibited by applicable law
and has been established in an amount
sufficient to pay for every escrowed item
that remains unpaid and has been
assessed but is not yet due and payable. No
escrow deposits or other charges or
payments due under the Mortgage Note have
been capitalized under any Mortgage or
the related Mortgage Note. Any interest
required to be paid pursuant to state,
federal and local law has been properly
paid and credited;
(dd) [Reserved];
(ee) In the event that at origination the Mortgage Loan has a
Loan-to-Value Ratio greater than 80%, the
excess of the principal balance of the
Mortgage Loan over 75% of the Appraised
Value of the Mortgaged Property, with
respect to a refinanced Mortgage Loan, or
the lesser of the Appraised Value or
the purchase price of the Mortgaged
Property (or Underlying Mortgaged Property,
in the case of a Co-op Loan), with respect
to a purchase money Mortgage Loan, is
and will be insured as to payment defaults
by a Primary Insurance Policy issued
by a Qualified Insurer, except where the
primary mortgage insurance was (i)
impermissible at origination at applicable
law, in which case such Mortgage Loan
was originated in accordance with
applicable law, (ii) cancelled at the request
of the Mortgagor pursuant to the
cancellation requirements of FNMA, FHLMC, state
law or, as applicable the Home Owner and
Equity Protection Act of 1994, as
amended, or (iii) automatically terminated
in accordance with the termination
requirements of FNMA, FHLMC, state law or,
as applicable the Home Owner and
Equity Protection Act of 1994, as amended.
All provisions of such Primary
Insurance Policy have been and are being
complied with, such policy is in full
force and effect, and all premiums due
thereunder have been paid. No action,
inaction, or event has occurred and no
state of facts exists that has, or will
result in the exclusion from, denial of, or
defense to coverage. Any Mortgage
Loan subject to a Primary Insurance Policy
obligates the Mortgagor thereunder to
maintain the Primary Insurance Policy and
to pay all premiums and charges in
connection therewith. The Mortgage Rate for
the Mortgage Loan as set forth on
the Mortgage Loan Schedule is net of any
such insurance premium;
(ff) The Assignment of Mortgage is in recordable form and is
acceptable
for recording (or, in the case of a Co-op
Loan, is in a form acceptable for
filing) under the laws of the jurisdiction
in which the Mortgaged Property (or
underlying Mortgaged Property, in the case
of a Co-op Loan) is located;
(gg) As to Mortgage Loans that are not secured by an interest in
a
leasehold estate, the Mortgaged Property
(or Underlying Mortgaged Property, in
the case of a Co-op Loan), is located in
the state identified in the Mortgage
Loan Schedule and consists of a single
parcel of real property with a detached
single family residence erected thereon, or
a two-to four-family dwelling, or an
individual condominium unit in a
condominium project, or a dwelling unit in a
residential cooperative housing corporation
or an individual unit in an attached
planned unit development or a detached
planned unit development, provided,
however, that no residence or dwelling is a
single parcel of real property with
a mobile home thereon. As of the date of
origination, no portion of the
Mortgaged Property (or Underlying Mortgaged
Property, in the case of a Co-op
Loan), was used for commercial purposes,
and since the date of origination, to
the best of the Seller's knowledge, no
portion of the Mortgaged Property (or
Underlying Mortgaged Property, in the case
of a Co-op Loan), is used for
commercial purposes;
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(hh) If the Mortgaged Property is a condominium unit or a planned
unit
development (other than a de minimis
planned unit development), as of the date
of origination of the related Mortgage
Loan, such condominium or planned unit
development project met the Seller's
eligibility requirements, as set forth in
the Seller's underwriting guidelines as of
such date; in the case of each Co-op
Loan, the related residential cooperative
housing corporation complied in all
material respects with the Seller's
requirements as set forth in the Seller's
underwriting guidelines as of such
date;
(ii) To the best of the Seller's knowledge, there is no pending
action
or proceeding directly involving the
Mortgaged Property (or Underlying Mortgaged
Property, in the case of a Co-op Loan), in
which compliance with any
environmental law, rule or regulation is an
issue;
(jj) As of the Cut-off Date, the Seller has not granted any
interest
rate relief to the Mortgagor under the
Relief Act;
(kk) No Mortgage Loan was made in connection with the construction
or
rehabilitation of a Mortgaged Property (or
Underlying Mortgaged Property, in the
case of a Co-op Loan), or facilitating the
trade-in or exchange of a Mortgaged
Property (or Underlying Mortgaged Property,
in the case of a Co-op Loan);
(ll) No action has been taken or failed to be taken by Depositor,
on or
prior to the Closing Date, which has
resulted or will result in an exclusion
from, denial of, or defense to coverage
under any Primary Insurance Policy
(including, without limitation, any
exclusions, denials or defenses which would
limit or reduce the availability of the
timely payment of the full amount of the
loss otherwise due thereunder to the
insured) whether arising out of actions,
representations, errors, omissions,
negligence, or fraud of the Depositor, or
for any other reason under such
coverage;
(mm) The Mortgage Loan was originated by a mortgagee approved by
the
Secretary of Housing and Urban Development
pursuant to Sections 203 and 211 of
the National Housing Act, as amended, a
savings and loan association, a savings
bank, a commercial bank, credit union,
insurance company or similar institution
which is supervised and examined by a
federal or state authority;
(nn) Principal payments on the Mortgage Loan commenced no more
than
sixty (60) days after funds were disbursed
in connection with the Mortgage Loan.
The Mortgage Note is payable on the first
day of each month in equal monthly
installments of principal and interest,
with interest calculated and payable in
arrears, sufficient to amortize the
Mortgage Loan fully by the stated maturity
date, over an original term of not more
than thirty years from commencement of
amortization;
(oo) As of the Closing Date, the Mortgage Loan is a "qualified
mortgage" within the meaning of Section
860G(a)(3) of the Code (without regard
to Treasury Regulations ss.1.860G-2(f) or
any similar rule that provides that a
defective obligation is a qualified
mortgage for a temporary period);
(pp) With respect to a Mortgage Loan that is a Co-op Loan, the
stock
that is pledged as security for the
Mortgage Loan is held by a Person as a
tenant-stockholder (as defined in Section
216 of the Code) in a cooperative
housing corporation (as defined in Section
216 of the Code);
(qq) As of the Closing Date, the Mortgage Loan is not the subject
of
pending or final foreclosure proceedings
and the Seller would not, based on the
delinquency status of the Mortgage Loan,
institute foreclosure proceedings with
respect to the Mortgage Loan prior to the
next scheduled payment for the
Mortgage Loan;
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(rr) As of the Closing Date, the Mortgage Loan does not provide
for
interest other than at either (i) a single
fixed rate in effect throughout the
term of the Mortgage Loan or (ii) a
"variable rate" (within the meaning of
Treasury Regulation Section 1.860G-1(a)(3))
in effect throughout the term of the
Mortgage Loan;
(ss) No Mortgage Loan is a "covered loan" within the meaning of
the
Georgia Fair Lending Act of 2002, as
amended;
(tt) None of the Mortgage Loans are (a) covered by the Home
Ownership
and Equity Protection Act of 1994 or (b)
classified as a "high cost" loan or
similarly classified using different
terminology under any federal, state or
local law imposing heightened regulatory
scrutiny or additional legal liability
for residential mortgage loans having high
interest rates, points and/or fees
such as predatory lending laws; None of the
Mortgage Loans are "high cost" loans
as defined by the applicable federal, state
or local predatory and abusive
lending laws nor is any Mortgage Loan a
"High Cost Loan" or "Covered Loan," as
applicable (as such terms are defined in
the current Standard & Poor's LEVELS(R)
Glossary which is now version 5.6 revised,
appendix E) and no Mortgage Loan
originated on or after October 1, 2002
through March 6, 2003 is governed by the
Georgia Fair Lending Act of 2002, as
amended; and
(uu) As to each Mortgage Loan that is secured by an interest in
a
leasehold estate, (i) the use of a
leasehold estate for residential properties
is an accepted practice in the area where
the related Mortgaged Property is
located, (ii) residential property
consisting of leasehold estates is marketable
in the area where the related Mortgaged
Property is located, (iii) the related
lease has been recorded in the applicable
land records, (iv) the lease is valid
and in good standing and is not subject to
any prior lien by which the lease
could be terminated or subject to any
charge or penalty, and (v) the remaining
term of the lease does not terminate less
than five years after the maturity
date of such Mortgage Loan.
Upon discovery by any of the Depositor, the Servicer or the Trustee
of
a breach of any of the foregoing
representations and warranties which materially
and adversely affects the value of a
Mortgage Loan or the interest of the
Certificateholders (or which materially and
adversely affects the interests of
the Certificateholders in the related
Mortgage Loan in the case of a
representation and warranty relating to a
particular Mortgage Loan), the party
discovering such breach shall give prompt
written notice to the other parties
and to the Seller, which notice shall
specify the date of discovery. Pursuant to
the Sale Agreement, the Seller shall within
90 days from the earlier of (i) the
date of receipt of notice of such breach or
(ii) the date the Seller otherwise
discovers such breach, cure such breach,
substitute a Mortgage Loan pursuant to
the provisions of Section 3.03 or, if the
breach relates to a particular
Mortgage Loan, purchase such Mortgage Loan
from the Trustee at the Purchase
Price. The Purchase Price for the purchased
Mortgage Loan shall be paid to the
Servicer and shall be deposited by the
Servicer in the Collection Account
promptly upon receipt, and, upon receipt by
the Trustee of written notification
of such deposit signed by a Servicing
Officer, the Trustee shall promptly
release to the Seller the related Mortgage
File, and the Trustee shall execute
and deliver such instruments of transfer or
assignment as may be provided to it
by the Servicer, without recourse, as shall
be necessary to vest in the Seller
or its designee, as the case may be, any
Mortgage Loan released pursuant hereto,
and the Trustee shall have no further
responsibility with regard to such
Mortgage Loan. It is understood and agreed
that the obligation of the Seller to
cure, substitute or purchase any Mortgage
Loan as to which such a breach has
occurred shall constitute the sole remedy
respecting such breach available to
Certificateholders or the Trustee on behalf
of Certificateholder.
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Section 3.02 Representations and Warranties of the Servicer.
The
Servicer represents and warrants to, and
covenants with, the Trustee for the
benefit of the Certificateholders that as
of the Closing Date:
(a) The Servicer is a national banking association duly chartered
and
validly existing in good standing under the
laws of the United States, and the
Servicer is duly qualified or registered as
a foreign corporation in good
standing in each jurisdiction in which the
ownership or lease or its properties
or the conduct of its business requires
such qualification;
(b) The execution and delivery of this Agreement by the Servicer
and
its performance and compliance with the
terms of this Agreement will not violate
the Servicer's articles of association or
by-laws or constitute a default (or an
event which, with notice or lapse of time,
or both, would constitute a default)
under, or result in the breach of, any
material contract, agreement or other
instrument to which the Servicer is a party
or which may be applicable to the
Servicer or any of its assets;
(c) This Agreement, assuming due authorization, execution and
delivery
by the Trustee and the Depositor,
constitutes a valid, legal and binding
obligation of the Servicer, enforceable
against it in accordance with the terms
hereof subject to applicable bankruptcy,
insolvency, reorganization, moratorium
and other laws affecting the enforcement of
creditors' rights generally and to
general principles of equity, regardless of
whether such enforcement is
considered in a proceeding in equity or at
law;
(d) The Servicer is not in default with respect to any order or
decree
of any court or any order, regulation or
demand of any federal, state, municipal
or governmental agency, which default might
have consequences that would
materially and adversely affect the
condition (financial or other) or operations
of the Servicer or its properties or might
have consequences that would affect
its performance hereunder; and
(e) No litigation is pending or, to the best of the Servicer's
knowledge, threatened against the Servicer
which would prohibit its entering
into this Agreement or performing its
obligations under this Agreement. It is
understood and agreed that the
representations and warranties set forth in this
Section 3.02 shall survive the issuance and
delivery of the Certificates and
shall be continuing as long as any
Certificate shall be outstanding or this
Agreement has been terminated.
Section 3.03 Option to Substitute. If Seller is required to
repurchase
any Mortgage Loan pursuant to Section 2.02
or 3.01, the Seller may, at its
option, within two years from the Closing
Date, remove such defective Mortgage
Loan from the terms of this Agreement and
substitute another mortgage loan for
such defective Mortgage Loan, in lieu of
repurchasing such defective Mortgage
Loan. Any substitute Mortgage Loan shall
(a) have a Principal Balance at the
time of substitution not in excess of the
Principal Balance of the removed
Mortgage Loan (the amount of any
difference, plus one month's interest thereon
at the Mortgage Rate borne by the removed
Mortgage Loan, being paid by the
Seller and deemed to be a Principal
Prepayment to be deposited by the Servicer
in the Collection Account), (b) have a
Mortgage Rate not less than, and not more
than one percentage point greater than, the
Mortgage Rate of the removed
Mortgage Loan (provided, however, that if
the Mortgage Rate on the substitute
Mortgage Loan exceeds the Mortgage Rate on
the removed Mortgage Loan, the amount
of that excess interest (the "Substitute
Excess Interest") shall be payable to
the Class A-R Certificate), (c) have a
remaining term to stated maturity not
later than, and not more than one year less
than, the remaining term to stated
maturity of the removed Mortgage Loan, (d)
be, in the reasonable determination
of the Servicer, of the same type, quality
and character (including location of
the Mortgaged Property (or underlying
Mortgaged Property, in the case of a Co-op
Loan)) as the removed Mortgage Loan as if
the breach had not occurred, (e) have
a Loan-to-Value Ratio at origination no
greater than that of the removed
Mortgage Loan and (f) be, in the reasonable
determination of the Seller, in
material compliance with the
representations and warranties contained in the
Sale Agreement and described in Section
3.01, as of the date of substitution.
45
<PAGE>
The Seller shall amend the Mortgage Loan Schedule to reflect
the
withdrawal of the removed Mortgage Loan
from this Agreement and the substitution
of such substitute Mortgage Loan therefor
and shall send a copy of such amended
Mortgage Loan Schedule to the Trustee. The
Sale Agreement provides that upon
such amendment the Seller shall be deemed
to have made as to such substitute
Mortgage Loan the representations and
warranties set forth in Section 3.01 as of
the date of such substitution, which shall
be continuing as long as any
Certificate shall be outstanding or this
Agreement has not been terminated, and
the remedies for breach of any such
representation or warranty shall be as set
forth in Section 3.01. Upon such amendment,
the Trustee shall review the
Mortgage File delivered to it relating to
the substitute Mortgage Loan, within
the time and in the manner and with the
remedies specified in Section 2.02,
except that for purposes of this Section
3.03 (other than the two-year period
specified in the first sentence of this
Section), such time shall be measured
from the date of the applicable
substitution. In the event of such a
substitution, accrued interest on the
substitute Mortgage Loan for the month in
which the substitution occurs and any
Principal Prepayments made thereon during
such month shall be the property of the
Trust Fund, and accrued interest for
such month on the Mortgage Loan for which
the substitution is made and any
Principal Prepayments made thereon during
such month shall be the property of
the Seller. The principal payment on a
substitute Mortgage Loan due on the Due
Date in the month of substitution shall be
the property of the Seller, and the
principal payment on the Mortgage Loan for
which the substitution is made due on
such date shall be the property of the
Trust Fund.
[END OF ARTICLE
III]
ARTICLE IV
THE CERTIFICATES
Section 4.01 The Certificates.
(a) The Class A, Class M and Class B Certificates shall be
substantially in the forms thereof included
within Exhibits C, D, E and F and
shall, on original issue, be executed by
the Depositor and authenticated by the
Trustee (or, if an Authenticating Agent has
been appointed pursuant to Section
4.06, the Authenticating Agent) upon
receipt by the Trustee of the documents
specified in Section 2.01, delivered to or
upon the order of the Depositor.
(b) The Depository and the Trustee have entered into a
Depository
Agreement dated as of October 25, 2005 (the
"Depository Agreement"). Except as
provided in paragraph (c) below, the
Book-Entry Certificates shall at all times
remain registered in the name of the
Depository or its nominee and at all times:
(i) registration of the Book-Entry
Certificates may not be transferred as
provided in Section 4.02 except to a
successor to the Depository; (ii) ownership
and transfers of registration of the
Book-Entry Certificates on the books of the
Depository shall be governed by applicable
rules established by the Depository;
(iii) the Depository may collect its usual
and customary fees, charges and
expenses from its Depository Participants;
(iv) the Trustee shall deal with the
Depository, Depository Participants and
Indirect Participants as representatives
of the Certificate Owners of the Book-Entry
Certificates for purposes of
exercising the rights of such Holders under
this Agreement, and requests and
directions for and votes of such
representatives shall not be deemed to be
inconsistent if they are made with respect
to different Certificate Owners; and
(v) the Trustee may rely and shall be fully
protected in relying upon
information furnished by the Depository
with respect to its Depository
Participants and furnished by the
Depository Participants with respect to
Indirect Participants and persons shown on
the books of such Indirect
Participants as direct or indirect
Certificate Owners. The Depository Agreement
provides that the Depository shall maintain
book-entry records with respect to
the Certificate Owners and with respect to
ownership and transfers of such
Certificates.
46
<PAGE>
All transfers by Certificate Owners of Book-Entry Certificates
shall be
made in accordance with the procedures
established by the Depository Participant
or brokerage firm representing such
Certificate Owners. Each Depository
Participant shall only transfer Book-Entry
Certificates of Certificate Owners it
represents or of brokerage firms for which
it acts as agent in accordance with
the Depository's normal procedures.
(c) If (i)(A) the
Depository advises the Depositor, the Paying Agent or
the Trustee in writing that the Depository
is no longer willing or able to
properly discharge its responsibilities as
Depository and (B) the Trustee, the
Paying Agent or the Depositor are unable
after exercise of their reasonable best
efforts to locate a qualified successor or
(ii) the Depositor at its option
advises the Trustee in writing that it
elects to terminate the book-entry system
through the Depository, the Trustee or, if
a Paying Agent has been appointed
under Section 4.05, the Paying Agent, shall
notify all Certificate Owners,
through the Depository, of the occurrence
of any such event and of the
availability of definitive, fully
registered Certificates (the "Definitive
Certificates") to Certificate Owners
requesting the same. Upon surrender to the
Trustee or, if a Paying Agent has been
appointed under Section 4.05, the Paying
Agent, of the Book-Entry Certificates by
the Depository for registration and
receipt by the Trustee or, if a Paying
Agent has been appointed under Section
4.05, the Paying Agent, of an adequate
supply of certificates from the
Depositor, the Trustee or if the Paying
Agent is appointed under Section 4.05,
the Paying Agent shall issue the Definitive
Certificates based on information
received from the Depository. Neither the
Depositor, the Servicer, the Paying
Agent nor the Trustee shall be liable for
any delay in delivery of such
instructions and may conclusively rely on,
and shall be protected in relying on,
such instructions.
(d) The Certificates (other than the Class A-R Certificate) shall
be
issuable in the minimum original dollar
denominations (and integral multiples of
$1,000.00 in excess of such amount) and
aggregate original dollar denominations
per Class (or in the case of the Class A-X,
in the minimum denominations based
on the Class A-X Notional Amount) as set
forth in the following table (except
that, if necessary, in order to aggregate
the Original Certificate Principal
Balance of a Class, one Certificate of such
Class will be issued in a different
denomination). A single Class A-R
Certificate will be issued in definitive form
in a $100 denomination.
<TABLE>
<CAPTION>
Aggregate Original Certificate
Minimum
Principal Balance of all
Original
Certificates of the
CUSIP
Class
Denomination
Indicated Class
Number
----------------------
------------
-------------------------------
---------
<S>
<C>
<C>
<C>
Class A-1.............
$
25,000.00
$74,420,500.00
16162WNB1
Class A-2.............
$
25,000.00
$2,579,500.00
16162WNC9
Class A-3.............
$
25,000.00
$150,000,000.00
16162WND7
Class A-4.............
$
25,000.00
$146,886,800.00
16162WNE5
Class A-5.............
$
25,000.00
$40,000,000.00
16162WNF2
Class A-6.............
$
25,000.00
$1,950,700.00
16162WNG0
Class A-7.............
$
1,000.00
$33,900,700.00
16162WNH8
Class A-8.............
$
1,000.00
$36,720,200.00
16162WNJ4
Class A-9.............
$
1,000.00
$31,137,600.00
16162WNK1
Class A-10............
$
1,000.00
$19,527,000.00
16162WNL9
Class A-11............
$
25,000.00
$50,000,000.00
16162WNM7
Class A-12............
$
25,000.00
$38,500,000.00
16162WNN5
</TABLE>
47
<PAGE>
<TABLE>
<CAPTION>
Aggregate Original Certificate
Minimum
Principal Balance of all
Original
Certificates of the
CUSIP
Class
Denomination
Indicated Class
Number
----------------------
------------
-------------------------------
---------
<S>
<C>
<C>
<C>
Class A-13............
$
25,000.00
$33,600,000.00
16162WNP0
Class A-14............ $ 25,000.00
$76,800,000.00
16162WNQ8
Class A-15............
$
25,000.00
$1,100,000.00
16162WNR6
Class A-X(1)..........
$
25,000.00
(1)
16162WNS4
Class A-P(2)..........
$
25,000.00
$1,786,552.00
16162WNT2
Class A-R(3).......
$
100.00
$100.00
16162WNU9
Class M...............
$
25,000.00
$13,761,000.00
16162WNV7
Class B-1.............
$
25,000.00
$4,969,000.00
16162WNW5
Class B-2.............
$
25,000.00
$2,676,000.00
16162WNX3
Class B-3.............
$
25,000.00
$1,529,000.00
16162WNY1
Class B-4.............
$
25,000.00
$1,147,000.00
16162WNZ8
Class B-5.............
$
25,000.00
$1,529,468.85
16162WPA1
</TABLE>
---------------
(1) The Class A-X Certificates are
interest-only certificates, have no principal
balance and will bear
interest on its notional amount. The original notional
amount of the Class
A-X Certificates is $26,364,821.54.
(2) The Class A-P Certificates are
principal-only certificates and are not
entitled to payments
of interest.
(3) The Class A-R Certificate represents
the residual interest in each of the
REMIC Pools.
The Certificates shall be signed by manual or facsimile signature
on
behalf of the Depositor by an officer of
the Depositor. Certificates bearing the
manual or facsimile signatures of
individuals who were at the time of signature
officers of the Depositor shall bind the
Depositor, notwithstanding that such
individuals or any of them have ceased to
be an officer prior to the
authentication and delivery of such
Certificate or did not hold such offices at
the date of such Certificates. No
Certificate shall be entitled to any benefit
under this Agreement, or be valid for any
purpose, unless there appears on such
Certificate a manual authentication by an
officer of the Trustee (or if an
Authenticating Agent has been appointed
pursuant to Section 4.06, the
Authenticating Agent) and such
authentication upon any Certificate shall be
conclusive evidence, and the only evidence,
that such Certificate has been duly
authenticated and delivered hereunder. All
Certificates shall be dated the date
of their authentication.
Section 4.02 Registration of Transfer and Exchange of
Certificates.
(a) The Trustee or, if a Paying Agent has been appointed under
Section
4.05, the Paying Agent, shall cause to be
kept a Certificate Register in which,
subject to such reasonable regulations as
it may prescribe, the Trustee or, if a
Paying Agent has been appointed under
Section 4.05, the Paying Agent, shall
provide for the registration of
Certificates and of transfers and exchanges of
Certificates as herein provided.
(b) Upon surrender for registration of transfer of any Certificate
at
any office or agency of the Trustee, or if
a Paying Agent has been appointed
hereunder pursuant to Section 4.05, the
Paying Agent maintained for such
purpose, the Depositor shall execute and
the Trustee or if an Authenticating
Agent is appointed under Section 4.06, the
Authenticating Agent shall
authenticate and deliver, in the name of
the designated transferee or
transferees, a Certificate of a like Class
and aggregate Percentage Interest and
dated the date of authentication by the
Authenticating Agent.
48
<PAGE>
(c) No transfer of a Class B-3, Class B-4 or Class B-5
Certificate
shall be made unless such transfer is made
pursuant to an effective registration
statement or otherwise in accordance with
the requirements under the Securities
Act of 1933, as amended. If such a transfer
is to be made in reliance upon an
exemption from said Act, (i) the Depositor
may require (except with respect to
the initial transfer of a Class B-3, Class
B-4 or Class B-5 Certificate from
J.P. Morgan Securities Inc. and except if
the transferee executes a certificate
substantially in the form of Exhibit H
hereto) a written opinion of independent
counsel acceptable to and in form and
substance satisfactory to the Depositor
that such transfer may be made pursuant to
an exemption, describing the
applicable exemption and the basis
therefor, from said Act and laws or is being
made pursuant to said Act and laws, which
opinion of counsel shall not be an
expense of the Trust Fund, the Trustee, the
Depositor or the Servicer, and (ii)
the Depositor shall require the transferee
to execute a certification
substantially in the form of Exhibit H or
Exhibit I.
(d) (i) No transfer of an ERISA Restricted Certificate or a Class
A-R
Certificate shall be registered unless the
prospective transferee provides the
Depositor with (A) a representation as set
forth in Exhibit K for the Class A-R
Certificate or Exhibit M for an ERISA
Restricted Certificate to the effect that
such transferee is not an employee benefit
plan subject to Title I of ERISA, a
plan subject to Section 4975 of the Code or
a plan or arrangement subject to any
provisions under any federal, state, local,
non-U.S. or other laws or
regulations that are substantively similar
to the foregoing provisions of ERISA
or the Code ("Similar Law") (collectively,
a "Plan"), or to any Person directly
or indirectly acquiring the ERISA
Restricted Certificate or the Class A-R
Certificate for, on behalf of or with any
assets of any such Plan, or (B) solely
in the case of an ERISA Restricted
Certificate (I) a representation as set forth
in Exhibit M for an ERISA Restricted
Certificate that, if the Certificate has
been the subject of an ERISA-Qualifying
Underwriting, such transferee is an
insurance company that is acquiring the
ERISA-Restricted Certificate with assets
contained in an "insurance company general
account," as defined in Section V(E)
of Prohibited Transaction Class Exemption
("PTCE") 95-60, and the acquisition
and holding of the Certificate are covered
and exempt under Sections I and III
of PTCE 95-60, or (II) solely in the case
of an ERISA Restricted Certificate
that is a Definitive Certificate, an
Opinion of Counsel satisfactory to the
Depositor to the effect that the
acquisition and holding of such Certificate
will not constitute or result in a
nonexempt prohibited transaction under ERISA
or the Code, or a violation of Similar Law,
and will not subject the Depositor,
the Servicer or the Trustee to any
obligation in addition to those expressly
undertaken in this Agreement, which Opinion
of Counsel shall not be an expense
of the Depositor, the Servicer or the
Trustee.
(ii) Except in the case of a Definitive Certificate, the
representations set forth in Section
4.02(d)(i), other than the representation
in Section 4.02(d)(i)(B)(II), shall be
deemed to have been made to Depositor by
the transferee's acceptance of an ERISA
Restricted Certificate or a Class A-R
Certificate (or the acceptance by a
Certificate Owner of the beneficial interest
in any Class of ERISA Restricted
Certificates or a Class A-R Certificate).
Notwithstanding any other provision herein
to the contrary, any purported
transfer of an ERISA Restricted Certificate
to or on behalf of a Plan without
the delivery to the Depositor of a
representation or an Opinion of Counsel
satisfactory to the Depositor as described
above shall be void and of no effect.
None of the Depositor, the Servicer or the
Trustee shall be under any liability
to any Person for any registration or
transfer of any ERISA Restricted
Certificate or Class A-R Certificate that
is in fact not permitted by this
Section 4.02(d) nor shall the Paying Agent
be under any liability for making any
payments due on such Certificate to the
Holder thereof or taking any other
action with respect to such Holder under
the provisions of this Agreement so
long as the transfer was registered in
accordance with the foregoing
requirements. The Depositor, Servicer,
Paying Agent and/or Trustee shall be
entitled, but not obligated, to recover
from any Holder of any ERISA Restricted
Certificate that was in fact a Plan and
that held such Certificate in violation
of this Section 4.02(d) all payments made
on such ERISA Restricted Certificate
at and after the time it commenced such
holding. Any such payments so recovered
shall be paid and delivered to the last
preceding Holder of such Certificate
that is not a Plan. Notwithstanding any
other provision herein to the contrary,
any purported transfer of an ERISA
Restricted Certificate or a Class A-R
Certificate to or on behalf of a Plan
without the delivery to the Depositor of a
representation or an Opinion of Counsel
satisfactory to the Depositor as
described above shall be void and of no
effect. None of the Depositor, the
49
<PAGE>
Servicer or the Trustee shall be under any
liability to any Person for any
registration or transfer of any ERISA
Restricted Certificate or a Class A-R
Certificate that is in fact not permitted
by this Section 4.02(d) nor shall the
Paying Agent be under any liability for
making any payments due on such
Certificate to the Holder thereof or taking
any other action with respect to
such Holder under the provisions of this
Agreement so long as the transfer was
registered in accordance with the foregoing
requirements. The Depositor,
Servicer, Paying Agent and/or Trustee shall
be entitled, but not obligated, to
recover from any Holder of any ERISA
Restricted Certificate or Class A-R
Certificate that was in fact a Plan and
that held such Certificate in violation
of this Section 4.02(d) all payments made
on such ERISA Restricted Certificate
or Class A-R Certificate at and after the
time it commenced such holding. Any
such payments so recovered shall be paid
and delivered to the last preceding
Holder of such Certificate that is not a
Plan.
(e) At the option of a Certificateholder, a Certificate may be
exchanged for another Certificate or
Certificates of authorized denominations of
a like Class, upon surrender of the
Certificate to be exchanged at any office or
agency of the Trustee, or if a Paying Agent
has been appointed under Section
4.05, the Paying Agent, maintained for such
purpose. Whenever the Certificate is
so surrendered for exchange, the Depositor
shall execute and the Authenticating
Agent shall authenticate and deliver, the
Certificate which the
Certificateholder making the exchange is
entitled to receive. Every Certificate
presented or surrendered for transfer or
exchange shall (if so required by the
Authenticating Agent) be duly endorsed by,
or be accompanied by a written
instrument of transfer in the form
satisfactory to the Authenticating Agent duly
executed by, the Holder thereof or his
attorney duly authorized in writing.
(f) No service charge shall be made to the Holder for any transfer
or
exchange of a Certificate, but the Servicer
may require payment by the
Certificateholders of a sum sufficient to
cover any tax or governmental charge
that may be imposed in connection with any
transfer or exchange of such
Certificate.
(g) All Certificates surrendered for transfer or exchange shall
be
destroyed by the Trustee or if a Paying
Agent has been appointed under Section
4.05, the Paying Agent, in accordance with
the Trustee's or, if a Paying Agent
has been appointed under Section 4.05, the
Paying Agent's, standard procedures.
(h) [Reserved].
(i) A Disqualified Organization is prohibited from acquiring
beneficial
ownership of a Class A-R Certificate.
Notwithstanding anything to the contrary
contained herein, (i) unless and until the
Servicer shall have received an
Opinion of Counsel, satisfactory to it in
form and substance, to the effect that
the absence of the conditions contained in
this Section 4.02(i) would not result
in the imposition of federal tax upon any
REMIC created hereunder or cause any
REMIC created hereunder to fail to qualify
as a REMIC, no transfer, sale or
other disposition of the Class A-R
Certificate (including for purposes of this
section any beneficial interest therein)
may be made without the express written
consent of the Certificate Registrar or, if
no Certificate Registrar is
appointed, the Trustee, which consent is to
be granted by the Certificate
Registrar or, if no Certificate Registrar
is appointed, the Trustee only upon
compliance with the requirements of this
Section and (ii) no transfer, sale or
other disposition of the Class A-R
Certificate (or any beneficial interest
therein) may be made to a Person who is not
a U.S. Person unless such Person
furnishes the transferor and the
Certificate Registrar or, if no Certificate
Registrar is appointed, the Trustee, with a
duly completed and effective Form
W-8ECI (or any successor thereto) or an
Opinion of Counsel to the effect that
such transfer is in accordance with the
requirements of the Code and that the
transfer will not be disregarded for
federal income tax purposes. As a condition
to granting its consent to a transfer of a
Class A-R Certificate, the
50
<PAGE>
Certificate Registrar or, if no Certificate
Registrar is appointed, the Trustee,
shall require the proposed transferee of
such Certificate (including, in the
case of the initial issuance of the Class
A-R Certificate, the initial Holder
thereof) to execute a letter and affidavit
substantially in the form attached
hereto as Exhibit K and shall require the
proposed transferor (other than in the
case of the transfer to the initial holder)
of such Certificate to execute a
letter substantially in the form attached
hereto as Exhibit K-1. In the absence
of a contrary instruction from the
transferor of such Certificate, declaration
(11) in the affidavit in Exhibit K may be
left blank. If the transferor requests
by written notice to the Certificate
Registrar or, if no Certificate Registrar
is appointed, the Trustee, prior to the
date of the proposed transfer that one
of the two other forms of declaration (11)
of such affidavit be used, then the
Certificate Registrar or, if no Certificate
Registrar is appointed, the Trustee,
shall require that such form of declaration
(11) be included in such affidavit.
As a condition to the granting of the consent referred to in
this
Section 4.02(i), prior to the transfer,
sale, pledge, hypothecation or other
disposition of the Class A-R Certificate or
any interest therein, the
Certificate Registrar or, if no Certificate
Registrar is appointed, the Trustee
shall require that (1) the proposed
transferee deliver to the Trustee or
Certificate Registrar, as applicable, its
taxpayer identification number and
state, under penalties of perjury that such
number is the social security or
employer identification number, as the case
may be, of the transferee or provide
an affidavit under penalties of perjury
stating that as of the date of such
transfer such transferee is not and has no
intention of becoming a Disqualified
Organization; (2) the proposed transferee
deliver to the Trustee or Certificate
Registrar, as applicable, an affidavit
stating (i) that such transferee is not
acquiring such Class A-R Certificate as an
agent, broker, nominee, or middleman
for a Disqualified Organization, (ii) if
the Class A-R Certificate is a
"non-economic residual interest" within the
meaning of Treas. Reg.
ss.1.860E-1(c)(2), (X) that no purpose of
the acquisition of the Class A-R
Certificate is to avoid or impede the
assessment or collection of tax, (Y) that
such transferee has historically paid its
debts as they came due and will
continue to pay its debts as they come due,
and (Z) that such transferee
represents that it understands that, as the
holder of the non-economic residual
interest, the transferee may incur tax
liabilities in excess of any cash flows
generated by the interest and that the
transferee intends to pay taxes
associated with holding the residual
interest, and (iii) unless the Certificate
Registrar or, if no Certificate Registrar
is appointed, the Trustee consents to
the transfer of the Class A-R Certificate
to a Person who is not a U.S. Person
and who has furnished either a duly
completed and effective Form W-8ECI (or any
successor thereto) or an Opinion of Counsel
to the effect that the transfer will
not be disregarded for federal income tax
purposes, that it is a U.S. Person;
(3) if so requested by the transferor in
written notice provided to the
Certificate Registrar or, if no Certificate
Registrar is appointed, the Trustee,
prior to the date of the proposed transfer,
the proposed transferee deliver to
the Trustee or Certificate Registrar, as
applicable, an affidavit that includes
a declaration made in the form of
declaration (11) in the affidavit set forth in
Exhibit K requested by the transferor; and
(4) the transferor deliver to the
Certificate Registrar or, if no Certificate
Registrar is appointed, the Trustee
a written certification that as of the date
of such transfer it has no knowledge
and no reason to know that the affirmations
described in clauses (1), (2) and
(3) were false. The Certificate Registrar
or, if no Certificate Registrar is
appointed, the Trustee shall not grant the
consent referred to in this Section
4.02(i) if it has actual knowledge that any
statement made in the affidavit
issued pursuant to the preceding sentence
is not true. Notwithstanding any
purported transfer, sale or other
disposition of the Class A-R Certificate to a
Disqualified Organization or in violation
of the provisions of this Section
4.02(i), such transfer, sale or other
disposition shall be deemed to be of no
legal force or effect whatsoever and such
Disqualified Organization shall not be
deemed to be a Class A-R Certificateholder
for any purpose hereunder, including,
but not limited to, the receipt of
distributions on such Class A-R Certificate.
If any purported transfer shall be in
violation of the provisions of this
Section 4.02(i) then the prior holder of
the Class A-R Certificate shall, upon
51
<PAGE>
discovery that the transfer of such Class
A-R Certificate was not in fact
permitted by this Section 4.02(i), be
restored to all rights and obligations as
a Holder thereof retroactive to the date of
the purported transfer of such Class
A-R Certificate. The Trustee, the Servicer
and the Certificate Registrar shall
be under no liability to any Person for any
registration or transfer of a Class
A-R Certificate that is not permitted by
this Section 4.02(i) or for making
payments due on such Class A-R Certificate
to the purported Holder thereof or
taking any other action with respect to
such purported Holder under the
provisions of this Agreement so long as the
transfer was not registered under
the written certification of the
Certificate Registrar or, if no Certificate
Registrar is appointed, the Trustee as
described in this Section 4.02(i). The
prior Holder shall be entitled to recover
from any purported Holder of a Class
A-R Certificate that was in fact not a
permitted purported transferee under this
Section 4.02(i) at the time it became a
purported Holder all payments made to
such purported Holder on such Class A-R
Certificate; provided that the Servicer
shall not be responsible for such recovery.
Each Class A-R Certificateholder, by
the acceptance of the Class A-R
Certificate, shall be deemed for all purposes to
have consented to the provisions of this
Section 4.02(i) and to any amendment to
this Agreement deemed necessary by counsel
of the Trustee or the Servicer to
ensure that the Class A-R Certificate is
not transferred to a Disqualified
Organization and that any transfer of such
Class A-R Certificate will not cause
the imposition of a tax upon any REMIC
created hereunder or cause any REMIC
created hereunder to fail to qualify as a
REMIC. The restrictions on transfer of
the Class A-R Certificate will cease to
apply and be void upon receipt by the
Certificate Registrar or, if no Certificate
Registrar is appointed, the Trustee
of an Opinion of Counsel to the effect that
such restrictions on transfer are no
longer necessary to avoid the risk of
material federal taxation to any REMIC
created hereunder or prevent any REMIC
created hereunder from qualifying as a
REMIC.
(j) The Servicer shall make available upon written request to
each
Holder and each proposed transferee of a
Class B-3, Class B-4 or Class B-5
Certificate such information as may be
required to permit the proposed transfer
to be effected pursuant to Rule 144A under
the Securities Act of 1933.
Section 4.03 Mutilated, Destroyed, Lost or Stolen Certificates. If
(a)
any mutilated Certificate is surrendered to
the Trustee or, if a Paying Agent
has been appointed under Section 4.05, the
Paying Agent, or the Trustee or, if a
Paying Agent has been appointed under
Section 4.05, the Paying Agent, receives
evidence to its satisfaction of the
destruction, loss or theft of any
Certificate, and (b) there is delivered to
the Trustee or, if a Paying Agent has
been appointed under Section 4.05, the
Paying Agent, such security or indemnity
as may be required by it to save it
harmless, then, in the absence of notice to
the Trustee or, if a Paying Agent has been
appointed under Section 4.05, the
Paying Agent, that such Certificate has
been acquired by a bona fide purchaser,
the Trustee or, if a Paying Agent has been
appointed under Section 4.05, the
Paying Agent, shall authenticate and
deliver, in exchange for or in lieu of any
such mutilated, destroyed, lost or stolen
Certificate, a new Certificate of like
tenor and Class. Upon the issuance of any
new Certificate under this Section,
the Trustee or, if a Paying Agent has been
appointed under Section 4.05, the
Paying Agent, may require of the
Certificateholder the payment of a sum
sufficient to cover any tax or other
governmental charge that may be imposed in
relation thereto and any other expenses
connected therewith. Any replacement
Certificate of any Class issued pursuant to
this Section shall constitute
complete and indefeasible evidence of
ownership of the Percentage Interest in
the distributions to which the
Certificateholders of such Class are entitled, as
if originally issued, whether or not the
mutilated, destroyed, lost or stolen
Certificate shall be found at any time, and
such mutilated, destroyed, lost or
stolen Certificate shall be of no force or
effect under this Agreement, to the
extent permitted by law.
Section 4.04 Persons Deemed Owners. Prior to due presentation of
a
Certificate of any Class for registration
of transfer, the Depositor, the
Servicer, the Paying Agent and the Trustee
may treat the Person in whose name
any Certificate is registered on the Record
Date as the owner of such
Certificate and the Percentage Interest in
the distributions to which the
Certificateholders of such Class are
entitled on the relevant date as the Holder
of such Certificate and the Percentage
Interest represented by such Certificate
for the purpose of receiving remittances
pursuant to Section 6.01 and for all
other purposes whatsoever, and neither the
Depositor, the Servicer, the Paying
Agent nor the Trustee shall be affected by
notice to the contrary.
52
<PAGE>
Section 4.05 Appointment of Paying Agent, Certificate Registrar
and
Backup Advancer; Certificate Account. The
Trustee may appoint a Paying Agent and
a Certificate Registrar hereunder, but such
Paying Agent and such Certificate
Registrar shall not be the Depositor, the
Seller, or an Affiliate of the
Depositor or the Seller unless such Paying
Agent or such Certificate Registrar
is the Global Debt Department of Chase. In
the event of an appointment of such
Paying Agent, no later than two Business
Days prior to each Distribution Date,
the Servicer shall deposit or cause to be
deposited with the Paying Agent from
funds on deposit in the Collection Account
a sum up to the Available
Distribution Amount, such sum to be held in
trust for the benefit of
Certificateholders in a segregated account
(the "Certificate Account") which
shall be an Eligible Account in the name of
"Wachovia Bank, N.A., as Trustee, in
trust for and for the benefit of the
Certificateholders of Multi-Class Mortgage
Pass-Through Certificates, Chase Mortgage
Finance Corporation, Series 2005-S3 -
Certificate Account". The Paying Agent
shall establish such Certificate Account
with a commercial bank, a savings bank or a
savings and loan association. The
Paying Agent may invest moneys in the
Certificate Account in Eligible
Investments, which shall mature not later
than a date sufficient to make payment
on the Distribute Date next following the
date of such investment and shall not
be sold or disposed of prior to maturity.
All income and gain realized from any
such investment shall be for the benefit of
the Paying Agent as additional
compensation and shall be subject to its
withdrawal or order from time to time.
The amount of any losses incurred in
respect of any such investments (to the
extent not offset by income from other such
investments) shall be deposited in
the Certificate Account by the Paying Agent
out of its own funds immediately as
realized. The Servicer shall cause the
Paying Agent to perform each of the
obligations of the Paying Agent set forth
herein and shall be liable to the
Trustee and the Certificateholders for
failure of the Paying Agent to perform
such obligations. If the Paying Agent is a
party other than the Trustee, the
Trustee shall have no liability in
connection with the performance or failure of
performance of the Paying Agent. The
Trustee designates the Global Debt
Department of Chase as the initial Paying
Agent and initial Certificate
Registrar. Only the Trustee may remove the
Paying Agent and Certificate
Registrar and may do so at will, provided
that the Trustee gives 20 days' prior
written notice of such removal to the
Paying Agent and Certificate Registrar and
the Rating Agencies. The Paying Agent is
designated the Backup Advancer. The
Paying Agent may not be removed as Backup
Advancer nor resign as Backup Advancer
unless (a) Chase is removed or resigns as
Servicer or (b) it has been removed as
Paying Agent. Thereafter, provided that the
Paying Agent gives written notice to
the Rating Agencies and the Trustee of its
resignation as Backup Advancer, the
Paying Agent will no longer be obligated to
provide Advances 20 or more days
from the date of such notice.
If, on any Distribution Date, the Paying Agent fails to distribute
to
Certificateholders the amounts then on
deposit in the Certificate Account for
the purposes specified herein, the Trustee
shall be obligated promptly upon its
knowledge thereof to distribute such
amounts to Certificateholders in the manner
and in such amounts based upon information
provided by the Servicer; provided
that in no event shall the Trustee be
obligated for purposes of this paragraph
to distribute to Certificateholders any
amounts other than those on deposit in
the Certificate Account or expend any funds
not reimbursable pursuant to Section
10.05 hereof, except as otherwise provided
herein. Notwithstanding anything in
this Agreement to the contrary, the Trustee
shall be liable to the Servicer and
the Certificateholders only for its
negligence in connection with the withdrawal
of funds from the Certificate Account by
the Trustee and the distribution of
such funds by the Trustee to
Certificateholders pursuant to this paragraph.
The Servicer shall cause each Pa
