<PAGE>
EXECUTION COPY
CHASE MORTGAGE FINANCE CORPORATION,
DEPOSITOR,
JPMORGAN CHASE BANK, N.A.,
SERVICER AND CUSTODIAN,
JPMORGAN CHASE BANK, N.A.,
PAYING AGENT
AND
THE BANK OF NEW YORK,
TRUSTEE
POOLING AND SERVICING AGREEMENT
Dated as of September 1, 2006
$1,024,294,266
Multi-Class Mortgage Pass-Through Certificates
Series 2006-S2
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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.......................... 47
Section 2.06
Qualifying
Special Purpose Entity...................... 47
ARTICLE III REPRESENTATIONS AND
WARRANTIES OF THE DEPOSITOR AND THE
SERVICER; REPURCHASE OF MORTGAGE LOANS.....................
47
Section 3.01
Representations and Warranties of the Depositor with
respect to the Mortgage Loans..........................
47
Section 3.02
Representations and Warranties of the Servicer.........
55
Section 3.03
Option to
Substitute................................... 56
ARTICLE IV THE
CERTIFICATES...........................................
56
Section 4.01
The
Certificates....................................... 58
Section 4.02
Registration of Transfer and Exchange of Certificates..
62
Section 4.03
Mutilated,
Destroyed, Lost or Stolen Certificates...... 62
Section 4.04
Persons
Deemed Owners.................................. 62
Section 4.05
Appointment of Paying Agent and Certificate Registrar;
Certificate Account....................................
62
Section 4.06
Authenticating Agents..................................
63
ARTICLE V
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS.............
64
Section 5.01
Servicer
to Service Mortgage Loans..................... 64
Section 5.02
Sub-Servicing Agreements Between Servicer and
Sub-Servicers; Enforcement of Sub-Servicer's
Obligations............................................
65
Section 5.03
Successor
Sub-Servicers................................ 65
Section 5.04
Liability
of the Servicer.............................. 66
Section 5.05
No
Contractual Relationship Between Sub-Servicer and
Trustee or Certificateholders..........................
66
Section 5.06
Termination of Sub-Servicing Agreement.................
66
Section 5.07
Collection
of Mortgage Loan Payments................... 66
Section 5.08
Establishment of Collection Account; Deposit in
Collection Account.....................................
66
Section 5.09
Permitted
Withdrawals from the Collection Account...... 68
Section 5.10
Establishment of Escrow Account; Deposits in Escrow
Account................................................
68
Section 5.11
Permitted
Withdrawals from Escrow Account.............. 69
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Section 5.12
Payment of
Taxes, Insurance and Other Charges.......... 69
Section 5.13
Transfer
of Accounts................................... 69
Section 5.14
[Reserved].............................................
69
Section 5.15
Maintenance of the Primary Insurance Policies..........
69
Section 5.16
Maintenance of Standard Hazard Policies................
69
Section 5.17
[Reserved].............................................
70
Section 5.18
[Reserved].............................................
70
Section 5.19
Fidelity
Bond and Errors and Omissions Insurance....... 70
Section 5.20
Collections under Insurance Policies; Enforcement of
Due-On-Sale Clauses; Assumption Agreements.............
71
Section 5.21
Income and
Realization from Defaulted Mortgage Loans... 71
Section 5.22
Trustee to
Cooperate; Release of Mortgage Files........ 73
Section 5.23
Servicing
and Other Compensation....................... 74
Section 5.24
1934 Act
Reports....................................... 74
Section 5.25
Annual
Statement as to Compliance...................... 76
Section 5.26
Assessment
of Compliance and Independent Public
Accountants' Attestation; Financial Statements.........
76
Section 5.27
Access to
Certain Documentation; Rights of the
Depositor in Respect of the Servicer...................
78
Section 5.28
REMIC-Related Covenants................................
79
ARTICLE VI PAYMENTS TO THE
CERTIFICATEHOLDERS......................... 80
Section 6.01
Distributions..........................................
80
Section 6.02
Statements
to the Certificateholders................... 87
Section 6.03
Advances
by the Servicer............................... 89
Section 6.04
Allocation
of Realized Losses.......................... 90
Section 6.05
Compensating Interest; Allocation of Certain Interest
Shortfalls.............................................
91
Section 6.06
Subordination..........................................
92
Section 6.07
[Reserved].............................................
92
ARTICLE VII REPORTS TO BE PREPARED
BY THE SERVICER..................... 93
Section 7.01
Servicer
Shall Provide Information as Reasonably
Required...............................................
93
Section 7.02
Federal
Information Returns and Reports to
Certificateholders.....................................
93
ARTICLE VIII THE
DEPOSITOR AND THE SERVICER.............................
94
Section 8.01
Indemnification; Third Party Claims....................
94
Section 8.02
Merger or
Consolidation of the Depositor or the
Servicer...............................................
94
Section 8.03
Limitation
on Liability of the Depositor, the Servicer,
the Trustee and Others.................................
95
ii
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Section 8.04 Depositor and Servicer
Not to Resign................... 95
Section 8.05
Successor
to the Servicer.............................. 95
Section 8.06
Maintenance of Ratings.................................
97
ARTICLE IX
DEFAULT....................................................
97
Section 9.01
Events of
Default...................................... 97
Section 9.02
Waiver of
Defaults..................................... 98
Section 9.03
Trustee to
Act; Appointment of Successor............... 98
Section 9.04
Notification to Certificateholders and the Rating
Agencies...............................................
98
ARTICLE X CONCERNING
THE TRUSTEE..................................... 98
Section 10.01
Duties of
Trustee...................................... 98
Section 10.02
Certain Matters
Affecting the Trustee.................. 99
Section 10.03
Trustee Not
Liable for Certificates or Mortgage Loans.. 100
Section 10.04
Trustee May Own
Certificates........................... 100
Section 10.05
Fees and
Expenses...................................... 100
Section 10.06
Eligibility
Requirements for Trustee................... 101
Section 10.07
Resignation and
Removal of the Trustee................. 101
Section 10.08
Successor
Trustee...................................... 102
Section 10.09
Merger or
Consolidation of Trustee..................... 102
Section 10.10
Appointment of
Co-Trustee or Separate Trustee.......... 102
Section 10.11
Appointment of
Office or Agency........................ 103
Section 10.12
Indemnification........................................
103
ARTICLE XI
TERMINATION................................................
104
Section 11.01
Termination............................................
104
ARTICLE XII MISCELLANEOUS
PROVISIONS................................... 106
Section 12.01
Severability of
Provisions............................. 106
Section 12.02
Limitation on
Rights of Certificateholders............. 106
Section 12.03
Amendment..............................................
107
Section 12.04
Counterparts...........................................
107
Section 12.05
Duration of
Agreement.................................. 107
Section 12.06
Governing
Law.......................................... 107
Section 12.07
Notices................................................
107
Section 12.08
Further
Assurances..................................... 108
iii
<PAGE>
EXHIBIT A MORTGAGE LOAN
SCHEDULES
EXHIBIT A-1
MORTGAGE GROUP ONE MORTGAGE LOAN SCHEDULE
EXHIBIT A-2
MORTGAGE GROUP TWO MORTGAGE LOAN SCHEDULE
EXHIBIT B CONTENTS OF
MORTGAGE FILE
EXHIBIT C FORM OF CLASS A
CERTIFICATE
EXHIBIT D FORM OF CLASS M
CERTIFICATE
EXHIBIT E FORM OF CLASS B
CERTIFICATE
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
TRANSFEREE ERISA REPRESENTATION LETTER
EXHIBIT N [RESERVED]
EXHIBIT O FORM OF
OFFICER'S CERTIFICATE (PAYING AGENT)
EXHIBIT P LETTER OF
REPRESENTATIONS
EXHIBIT Q [RESERVED]
EXHIBIT R SERVICING
CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
EXHIBIT S FORM OF
SARBANES-OXLEY CERTIFICATION
EXHIBIT T FORM OF ITEM
1123 CERTIFICATION OF SERVICER
EXHIBIT U FORM OF CLASS
1-A10 YIELD MAINTENANCE AGREEMENT
EXHIBIT U-1 FORM
OF CLASS 2-A8 YIELD MAINTENANCE AGREEMENT
EXHIBIT V TARGETED
PRINCIPAL BALANCES FOR THE CLASS 2-A8 CERTIFICATES
SCHEDULE X
1934 ACT FORM 8-K REPORTING OBLIGATIONS
SCHEDULE Y
1934 ACT FORM 10-D REPORTING OBLIGATIONS
SCHEDULE Z
1934 ACT FORM 10-K REPORTING OBLIGATIONS
iv
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This Pooling and Servicing Agreement, dated as of September 1,
2006,
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 as custodian (together with its
permitted
successors and assigns, the "Custodian"), JPMorgan Chase Bank,
N.A., as paying
agent (in such capacity, together with its permitted successors and
assigns, the
"Paying Agent") and The Bank of New York, 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).
ACCOUNTANT'S ATTESTATION: As defined in Section 5.26(b).
ADDITIONAL FORM 10-D DISCLOSURE: As defined in Section 5.24(b).
ADDITIONAL FORM 10-K DISCLOSURE: As defined in Section 5.24(d).
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: With respect to the Trustee, the 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 101 Barclay Street, New York, New York 10286; and, with
respect to
the Paying Agent, the office of the Paying Agent 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 600 Travis, 9th Floor,
Houston, Texas
77002.
AGGREGATE SUBORDINATED PERCENTAGE: As defined in Section
6.01(I)(b)(vii)(A).
AGREEMENT: This Pooling and Servicing Agreement and all
amendments
hereof and supplements hereto.
<PAGE>
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).
ASSESSMENT OF COMPLIANCE: As defined in Section 5.26(a).
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(a).
AVAILABLE DISTRIBUTION AMOUNT: As to either Mortgage Group or, as
the
context requires, both Mortgage Groups, on any Distribution Date,
an amount
equal to the amount on deposit in the Collection Account with
respect to such
Mortgage Group 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 in such
Mortgage
Group 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 attributable,
in each case,
to Mortgage Loans in such Mortgage Group;
(c) amounts representing the Servicing Fee attributable in each
case
to the Mortgage Loans in such Mortgage Group with respect to such
Distribution
Date;
(d) amounts representing all or part of a Monthly Payment with
respect
to a Mortgage Loan in such Mortgage Group 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 in such Mortgage Group 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.
BANKRUPTCY AMOUNT: As of any date of determination, $259,896.34
minus
all Bankruptcy Losses on the Mortgage Loans, if any, previously
allocated to the
Certificates in accordance with Section 6.04.
2
<PAGE>
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.
BASIS RISK SHORTFALL CARRYOVER AMOUNT: For any Distribution Date
and
the Class 1-A10 and Class 2-A8 Certificates, an amount equal to the
sum of (i)
the excess of (x) the amount of interest such Class of Certificates
accrued for
such Distribution Date at the related Certificate Rate over (y) the
amount such
Class of Certificates accrued for such Distribution Date at the per
annum rate
of 6.25%, in the case of the Class 1-A10 Certificates, or at the
per annum rate
of 6.00%, in the case of the Class 2-A8 Certificates, and (ii) the
unpaid
portion of any Basis Risk Shortfall Carryover Amount for such Class
of
Certificates from prior Distribution Dates together with interest
accrued on
such unpaid portion for the most recently ended Accrual Period at
the related
Certificate Rate.
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, Class 1-AX and Class 2-AX 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 States of New York and Louisiana 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.
CAP STRIKE RATE: With respect to any Distribution Date and either
of
the Class 1-A10 Yield Maintenance Agreement or Class 2-A8 Yield
Maintenance
Agreement, the rate set forth under the heading "Cap Strike Rate"
in Exhibit U
or Exhibit U-1, respectively.
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
3
<PAGE>
Depositor or the Servicer as to the determination of which
Certificates are
registered in the name of such Affiliates.
CERTIFICATE GROUP: Each of (i) the Class 1-A Certificates,
collectively and (ii) the Class 2-A Certificates, collectively.
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 (i)
in the case
of the Class 1-A1, Class 1-A2, Class 1-A5, Class 1-A6, Class 1-A7,
Class 1-A8,
Class 1-A9, Class 1-A11, Class 1-A12, Class 1-A13, Class 1-A14,
Class 1-A15,
Class 1-A16, Class 1-A17, Class 1-A18, Class 1-A19, Class 1-AX and
Class A-R
Certificates will be 6.25%, (ii) in the case of the Class 1-A3,
2-A1, Class
2-A3, Class 2-A4, Class 2-A5, Class 2-A6, Class 2-A7, Class 2-A9
and Class 2-AX
Certificates will be 6.00%, (iii) in the case of the Class 1-A4
Certificates
will be 6.50% and (iv) in the case of the Class 2-A2 Certificates,
will be
5.75%. In the case of the Class 1-A10 Certificates, the Certificate
Rate with
respect to the first Distribution Date will be 6.25%, and as to any
Distribution
Date thereafter, the Certificate Rate on the Class 1-A10
Certificates will equal
the lesser of (A) 0.60% plus LIBOR and (B) 9.50%, but not less than
6.25%. In
the case of the Class 2-A8 Certificates, the Certificate Rate with
respect to
the first Distribution Date will be 6.00%, and as to any
Distribution Date
thereafter, the Certificate Rate on the Class 2-A8 Certificates
will equal the
lesser of (A) 0.50% plus LIBOR and (B) 9.50%, but not less than
6.00%. With
respect to each Class of Subordinated Certificates, the per annum
rate of
interest will equal the fraction, expressed as a percentage, (I)
the numerator
of which will equal the sum of (i) the product of (x) 6.25% and (y)
the Group
One Subordinated Amount, and (ii) the product of (x) 6.00% and (y)
the Group Two
Subordinated Amount and (II) the denominator of which will equal
the sum of the
Group One Subordinated Amount and the Group Two Subordinated
Amount. For federal
income tax purposes, the Certificate Rate on each Class of
Subordinate
Certificates can be expressed as a per annum rate equal to the
weighted average
of the interest rates on the Lower-Tier REMIC Regular Interests
ending with the
designation "A" weighted on the basis of their principal amounts
immediately
prior to such Distribution Date. Interest with respect to each
Class of
Certificates shall be calculated based on a 360 day year comprised
of twelve
30-day months.
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 1-A1, Class 1-A2, Class 1-A3,
Class
1-A4, Class 1-A5, Class 1-A6, Class 1-A7, Class 1-A8, Class 1-A9,
Class 1-A10,
Class 1-A11, Class 1-A12, Class 1-A13, Class 1-A14, Class 1-A15,
Class 1-A16,
Class 1-A17, Class 1-A18, Class 1-A19, Class 1-AX, Class A-P, Class
A-R, Class
2-A1, Class 2-A2, Class 2-A3, Class 2-A4, Class 2-A5, Class 2-A6,
Class 2-A7,
Class 2-A8, Class 2-A9, Class 2-AX, Class A-M, Class M-1, Class
B-1, Class B-2,
Class B-3, Class B-4, Class B-5 Certificates, any Lower-Tier REMIC
Interest or
any Middle-Tier REMIC Interest, as the case may be.
4
<PAGE>
CLASS 1-A CERTIFICATES: The Class 1-A1, Class 1-A2, Class 1-A3,
Class
1-A4, Class 1-A5, Class 1-A6, Class 1-A7, Class 1-A8, Class 1-A9,
Class 1-A10,
Class 1-A11, Class 1-A12, Class 1-A13, Class 1-A14, Class 1-A15,
Class 1-A16,
Class 1-A17, Class 1-A18, Class 1-A19, Class 1-AX and Class A-R
Certificates,
referred to collectively.
CLASS 1-A DEFICIENCY AMOUNT: As defined in Section
6.01(I)(b)(iii)
hereof.
CLASS 1-A1 CERTIFICATE: Any one of the Class 1-A1 Certificates,
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), 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 1-A1 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 1-A1 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 1-A1
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 1-A1
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 1-A1 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 1-A1 Interest
Accrual Amount
over the amount actually distributed to the Class 1-A1
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(A).
CLASS 1-A2 CERTIFICATE: Any one of the Class 1-A2 Certificates,
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), 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 1-A2 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 1-A2 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A2
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 1-A2
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 1-A2
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 1-A2 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 1-A2 Interest
Accrual Amount
over the amount actually distributed to the Class 1-A2
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(B).
CLASS 1-A3 CERTIFICATE: Any one of the Class 1-A3 Certificates,
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), 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 1-A3 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 1-A3 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A3
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 1-A3
Certificates
on such Distribution Date pursuant to Section
5
<PAGE>
6.05(c), and (iii) any interest shortfall resulting from the Relief
Act
allocated to the Class 1-A3 Certificates on such Distribution Date
pursuant to
Section 6.05(d).
CLASS 1-A3 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 1-A3 Interest
Accrual Amount
over the amount actually distributed to the Class 1-A3
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(C).
CLASS 1-A4 CERTIFICATE: Any one of the Class 1-A4 Certificates,
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), 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 1-A4 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 1-A4 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A4
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 1-A4
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 1-A4
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 1-A4 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 1-A4 Interest
Accrual Amount
over the amount actually distributed to the Class 1-A4
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(D).
CLASS 1-A5 CERTIFICATE: Any one of the Class 1-A5 Certificates,
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), 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 1-A5 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 1-A5 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A5
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 1-A5
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 1-A5
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 1-A5 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 1-A5 Interest
Accrual Amount
over the amount actually distributed to the Class 1-A5
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(E).
CLASS 1-A6 CERTIFICATE: Any one of the Class 1-A6 Certificates,
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), 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 1-A6 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 1-A6 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A6
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 1-A6
Certificates
on such Distribution Date pursuant to Section
6
<PAGE>
6.05(c), and (iii) any interest shortfall resulting from the Relief
Act
allocated to the Class 1-A6 Certificates on such Distribution Date
pursuant to
Section 6.05(d).
CLASS 1-A6 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 1-A6 Interest
Accrual Amount
over the amount actually distributed to the Class 1-A6
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(F).
CLASS 1-A7 CERTIFICATE: Any one of the Class 1-A7 Certificates,
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), 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 1-A7 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 1-A7 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A7
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 1-A7
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 1-A7
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 1-A7 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 1-A7 Interest
Accrual Amount
over the amount actually distributed to the Class 1-A7
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(G).
CLASS 1-A8 CERTIFICATE: Any one of the Class 1-A8 Certificates,
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), 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 1-A8 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 1-A8 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A8
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 1-A8
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 1-A8
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 1-A8 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 1-A8 Interest
Accrual Amount
over the amount actually distributed to the Class 1-A8
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(H).
CLASS 1-A9 CERTIFICATE: Any one of the Class 1-A9 Certificates,
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), 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 1-A9 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 1-A9 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A9
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 1-A9
Certificates
on such Distribution Date pursuant to Section
7
<PAGE>
6.05(c), and (iii) any interest shortfall resulting from the Relief
Act
allocated to the Class 1-A9 Certificates on such Distribution Date
pursuant to
Section 6.05(d).
CLASS 1-A9 LOCKOUT PERCENTAGE: With respect to any Distribution
Date
will equal the Outstanding Certificate Principal Balance
immediately preceding
such Distribution Date of the Class 1-A9 Certificates divided by
the aggregate
Outstanding Certificate Principal Balance of the Class A-R, Class
1-A1, Class
1-A2, Class 1-A3, Class 1-A4, Class 1-A5, Class 1-A6, Class 1-A7,
Class 1-A8,
Class 1-A9, Class 1-A10, Class 1-A11, Class 1-A12, and Class 1-A13
Certificates,
but in no case will the Class 1-A9 Lockout Percentage exceed
100%.
CLASS 1-A9 LOCKOUT PRINCIPAL DISTRIBUTION AMOUNT: With respect to
any
Distribution Date, will equal the product of the (1) Class 1-A9
Lockout
Percentage and (2) the portion of the Non-PO Class 1-A Optimal
Principal Amount
to be distributed pursuant to clause (1)(2) in the definition of
Non-PO Class
1-A Principal Payment Rules and (3) the Lockout Shift
Percentage.
CLASS 1-A9 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 1-A9 Interest
Accrual Amount
over the amount actually distributed to the Class 1-A9
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(I).
CLASS 1-A10 CERTIFICATE: Any one of the Class 1-A10
Certificates,
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), 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 1-A10 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Group One Remittance Rate on the
Outstanding
Certificate Principal Balance of the Class 1-A10 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A10
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 1-A10
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
1-A10 Certificates on such Distribution Date pursuant to Section
6.05(d).
CLASS 1-A10 MAXIMUM YIELD MAINTENANCE AGREEMENT AMOUNT: The
amount
described in Section 5.29(e).
CLASS 1-A10 SCHEDULED NOTIONAL AMOUNT: With respect to any
Distribution Date set forth in Exhibit U hereto, the amount set
forth with
respect to such Distribution Date in Exhibit U under the heading
"Notional."
CLASS 1-A10 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 1-A10 Interest
Accrual Amount
over the amount actually distributed to the Class 1-A10
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(J).
CLASS 1-A10 YIELD MAINTENANCE AGREEMENT: The Yield Maintenance
Agreement set forth on Exhibit U hereto.
CLASS 1-A11 CERTIFICATE: Any one of the Class 1-A11
Certificates,
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), 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 1-A11 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 1-A11 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A11
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 1-A11
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
1-A11 Certificates on such Distribution Date pursuant to Section
6.05(d).
CLASS 1-A11 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 1-A11 Interest
Accrual Amount
over the amount actually distributed to the Class 1-A11
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(K).
CLASS 1-A12 CERTIFICATE: Any one of the Class 1-A12
Certificates,
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), 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 1-A12 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 1-A12 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A12
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 1-A12
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
1-A12 Certificates on such Distribution Date pursuant to Section
6.05(d).
CLASS 1-A12 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 1-A12 Interest
Accrual Amount
over the amount actually distributed to the Class 1-A12
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(L).
CLASS 1-A13 ACCRETION TERMINATION DATE: The earlier to occur of
the
(i) the Distribution Date following the Distribution Date on which
the aggregate
Outstanding Certificate Principal Balance of the Class 1-A12
Certificates has
been reduced to zero and (ii) the Distribution Date following the
Credit Support
Depletion Date.
CLASS 1-A13 CERTIFICATE: Any one of the Class 1-A13
Certificates,
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), 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 1-A13 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 1-A13 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A13
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 1-A13
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
1-A13 Certificates on such Distribution Date pursuant to Section
6.05(d).
CLASS 1-A13 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 1-A13 Interest
Accrual Amount
over the amount actually distributed to the Class 1-A13
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(M).
9
<PAGE>
CLASS 1-A14 CERTIFICATE: Any one of the Class 1-A14
Certificates,
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), 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 1-A14 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 1-A14 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A14
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 1-A14
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
1-A14 Certificates on such Distribution Date pursuant to Section
6.05(d).
CLASS 1-A14 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 1-A14 Interest
Accrual Amount
over the amount actually distributed to the Class 1-A14
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(N).
CLASS 1-A15 CERTIFICATE: Any one of the Class 1-A15
Certificates,
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), 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 1-A15 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 1-A15 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A15
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 1-A15
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
1-A15 Certificates on such Distribution Date pursuant to Section
6.05(d).
CLASS 1-A15 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 1-A15 Interest
Accrual Amount
over the amount actually distributed to the Class 1-A15
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(O).
CLASS 1-A16 CERTIFICATE: Any one of the Class 1-A16
Certificates,
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), 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 1-A16 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 1-A16 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A16
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 1-A16
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
1-A16 Certificates on such Distribution Date pursuant to Section
6.05(d).
CLASS 1-A16 LOCKOUT PERCENTAGE: With respect to any Distribution
Date,
will equal the Outstanding Certificate Principal Balance of the
Class 1-A16
Certificates divided by the aggregate Outstanding Certificate
Principal Balance
immediately preceding such Distribution Date of the Class 1-A14,
Class 1-A15,
Class 1-A16, Class 1-A17, Class 1-A18 and Class 1-A19 Certificates,
but in no
case will the Class 1-A16 Lockout Percentage exceed 100%.
10
<PAGE>
CLASS 1-A16 LOCKOUT PRINCIPAL DISTRIBUTION AMOUNT: With respect to
any
Distribution Date, will equal the product of the (1) Class 1-A16
Lockout
Percentage and (2) the portion of the Non-PO Class 1-A Optimal
Principal Amount
to be distributed pursuant to clause (I)(1) in the definition of
Non-PO Class
1-A Principal Payment Rules and (3) the Lockout Shift
Percentage.
CLASS 1-A16 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 1-A16 Interest
Accrual Amount
over the amount actually distributed to the Class 1-A16
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(P).
CLASS 1-A17 CERTIFICATE: Any one of the Class 1-A17
Certificates,
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), 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 1-A17 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 1-A17 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A17
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 1-A17
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
1-A17 Certificates on such Distribution Date pursuant to Section
6.05(d).
CLASS 1-A17 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 1-A17 Interest
Accrual Amount
over the amount actually distributed to the Class 1-A17
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(Q).
CLASS 1-A18 CERTIFICATE: Any one of the Class 1-A18
Certificates,
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), 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 1-A18 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 1-A18 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A18
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 1-A18
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
1-A18 Certificates on such Distribution Date pursuant to Section
6.05(d).
CLASS 1-A18 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 1-A18 Interest
Accrual Amount
over the amount actually distributed to the Class 1-A18
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(R).
CLASS 1-A19 CERTIFICATE: Any one of the Class 1-A19
Certificates,
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), 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 1-A19 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 1-A19 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 1-A19
Certificates on
such Distribution Date pursuant to Section 6.05(b), (ii) any
Realized Loss
Interest Shortfall resulting
11
<PAGE>
from an Excess Loss allocated to the Class 1-A19 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 1-A19
Certificates on such
Distribution Date pursuant to Section 6.05(d).
CLASS 1-A19 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 1-A19 Interest
Accrual Amount
over the amount actually distributed to the Class 1-A19
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(S).
CLASS 1-AX CERTIFICATE: Any one of the Class 1-AX Certificates,
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), 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 1-AX INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the Class
1-AX Notional
Amount minus (i) any Compensating Interest Shortfall allocated to
the Class 1-AX
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 1-AX 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 1-AX Certificates on such Distribution Date pursuant to
Section 6.05(d).
CLASS 1-AX NOTIONAL AMOUNT: With respect to any Distribution Date,
an
amount equal to the product of the aggregate Scheduled Principal
Balance of the
Non-Discount Mortgage Loans in Mortgage Group One and a fraction
the numerator
of which is the Group One Stripped Interest Rate and the
denominator of which is
6.25%.
CLASS 1-AX SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 1-AX Interest
Accrual Amount
over the amount actually distributed to the Class 1-AX
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(T).
CLASS 2-A CERTIFICATES: The Class 2-A1, Class 2-A2, Class 2-A3,
Class
2-A4, Class 2-A5, Class 2-A6, Class 2-A7, Class 2-A8, Class 2-A9
and Class 2-AX
Certificates, referred to collectively.
CLASS 2-A DEFICIENCY AMOUNT: As defined in Section
6.01(I)(b)(iv)
hereof.
CLASS 2-A1 CERTIFICATE: Any one of the Class 2-A1 Certificates,
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), 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 2-A1 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 2-A1 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 2-A1
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 2-A1
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 2-A1
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 2-A1 LOCKOUT PERCENTAGE: With respect to any Distribution
Date,
the Outstanding Certificate Principal Balance of the Class 2-A1
Certificates
divided by the outstanding principal balance of the Class 2-A
Certificates
immediately preceding such Distribution Date, but in no case will
the Class 2-A1
Lockout Percentage exceed 100%.
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CLASS 2-A1 LOCKOUT PRINCIPAL DISTRIBUTION AMOUNT: With respect to
any
Distribution Date, the product of (1) the Class 2-A1 Lockout
Percentage and (2)
the Non-PO Class 2-A Optimal Principal Amount and (3) the Lockout
Shift
Percentage.
CLASS 2-A-1 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 2-A1 Interest
Accrual Amount
over the amount actually distributed to the Class 2-A1
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(U).
CLASS 2-A2 CERTIFICATE: Any one of the Class 2-A2 Certificates,
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), 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 2-A2 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 2-A2 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 2-A2
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 2-A2
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 2-A2
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 2-A2 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 2-A2 Interest
Accrual Amount
over the amount actually distributed to the Class 2-A2
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(V).
CLASS 2-A3 CERTIFICATE: Any one of the Class 2-A3 Certificates,
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), 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 2-A3 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the Class
2-A3 Notional
Amount minus (i) any Compensating Interest Shortfall allocated to
the Class 2-A3
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 2-A3 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 2-A3 Certificates on such Distribution Date pursuant to
Section 6.05(d).
CLASS 2-A3 NOTIONAL AMOUNT: With respect to any Distribution Date,
an
amount equal to the product of (a) the Outstanding Certificate
Principal Balance
of the Class 2-A2 Certificates immediately prior to such
Distribution Date and
(b) a fraction, the numerator of which is 0.25 and the denominator
of which is
6.
CLASS 2-A3 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 2-A3 Interest
Accrual Amount
over the amount actually distributed to the Class 2-A3
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(W).
CLASS 2-A4 CERTIFICATE: Any one of the Class 2-A4 Certificates,
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), 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.
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<PAGE>
CLASS 2-A4 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 2-A4 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 2-A4
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 2-A4
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 2-A4
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 2-A4 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 2-A4 Interest
Accrual Amount
over the amount actually distributed to the Class 2-A4
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(X).
CLASS 2-A5 CERTIFICATE: Any one of the Class 2-A5 Certificates,
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), 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 2-A5 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 2-A5 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 2-A5
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 2-A5
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 2-A5
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 2-A5 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 2-A5 Interest
Accrual Amount
over the amount actually distributed to the Class 2-A5
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(Y).
CLASS 2-A6 CERTIFICATE: Any one of the Class 2-A6 Certificates,
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), 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 2-A6 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 2-A6 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 2-A6
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 2-A6
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 2-A6
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 2-A6 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 2-A6 Interest
Accrual Amount
over the amount actually distributed to the Class 2-A6
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(Z).
CLASS 2-A7 CERTIFICATE: Any one of the Class 2-A7 Certificates,
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), 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.
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<PAGE>
CLASS 2-A7 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 2-A7 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 2-A7
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 2-A7
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 2-A7
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 2-A7 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 2-A7 Interest
Accrual Amount
over the amount actually distributed to the Class 2-A7
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(AA).
CLASS 2-A8 CERTIFICATE: Any one of the Class 2-A8 Certificates,
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), 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 2-A8 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Group Two Remittance Rate on the
Outstanding
Certificate Principal Balance of the Class 2-A8 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 2-A8
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 2-A8
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 2-A8
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 2-A8 MAXIMUM YIELD MAINTENANCE AGREEMENT AMOUNT: The
amount
described in Section 5.29(f).
CLASS 2-A8 SCHEDULED NOTIONAL AMOUNT: With respect to any
Distribution
Date set forth in Exhibit U-1 hereto, the amount set forth with
respect to such
Distribution Date in Exhibit U-1 under the heading "Notional."
CLASS 2-A8 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 2-A8 Interest
Accrual Amount
over the amount actually distributed to the Class 2-A8
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(BB).
CLASS 2-A8 YIELD MAINTENANCE AGREEMENT: The Yield Maintenance
Agreement set forth on Exhibit U-1 hereto.
CLASS 2-A9 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 2-A8
Certificates has
been reduced to zero and (ii) the Distribution Date following the
Credit Support
Depletion Date.
CLASS 2-A9 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 2-A9 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class 2-A9
Certificates on such
15
<PAGE>
Distribution Date pursuant to Section 6.05(b), (ii) any Realized
Loss Interest
Shortfall resulting from an Excess Loss allocated to the Class 2-A9
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 2-A9
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS 2-A9 SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 2-A9 Interest
Accrual Amount
over the amount actually distributed to the Class 2-A9
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(CC).
CLASS 2-AX CERTIFICATE: Any one of the Class 2-AX Certificates,
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), 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 2-AX INTEREST ACCRUAL AMOUNT: With respect to any
Distribution
Date, one month's interest at the Certificate Rate on the Class
2-AX Notional
Amount minus (i) any Compensating Interest Shortfall allocated to
the Class 2-AX
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 2-AX 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 2-AX Certificates on such Distribution Date pursuant to
Section 6.05(d).
CLASS 2-AX 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 in Mortgage Group Two and (b) a
fraction the
numerator of which is the Group Two Stripped Interest Rate and the
denominator
of which is 6.00%.
CLASS 2-AX SHORTFALL: With respect to any Distribution Date,
the
amount equal to the excess, if any, of the Class 2-AX Interest
Accrual Amount
over the amount actually distributed to the Class 2-AX
Certificateholders on
such Distribution Date pursuant to Section 6.01(I)(b)(i)(DD).
CLASS A CERTIFICATES: The Class 1-A1, Class 1-A2, Class 1-A3,
Class
1-A4, Class 1-A5, Class 1-A6, Class 1-A7, Class 1-A8, Class 1-A9,
Class 1-A10,
Class 1-A11, Class 1-A12, Class 1-A13, Class 1-A14, Class 1-A15,
Class 1-A16,
Class 1-A17, Class 1-A18, Class 1-A19, Class 1-AX, Class A-P, Class
A-R, Class
2-A1, Class 2-A2, Class 2-A3, Class 2-A4, Class 2-A5, Class 2-A6,
Class 2-A7,
Class 2-A8, Class 2-A9 and Class 2-AX Certificates, referred to
collectively.
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 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 (or deemed 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 A-M CERTIFICATE: Any one of the Class A-M Certificates
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),
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 A-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 A-M Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class A-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 A-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 A-M
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS A-M PRINCIPAL BALANCE: As of any Distribution Date, (a)
the
Class A-M Principal Balance for the immediately preceding
Distribution Date less
(b) amounts distributed to the Class A-M Certificateholders on such
preceding
Distribution Date allocable to principal (including the
principal
16
<PAGE>
portion of Advances of the Servicer made pursuant to Section 6.03
and Realized
Losses allocated to the Class A-M Certificates pursuant to Section
6.04);
provided that the Class A-M Principal Balance on the first
Distribution Date
shall be the Original Class A-M Principal Balance, and provided
further that if
the aggregate Outstanding Certificate Principal Balance of the
Class B and Class
M-1 Certificates has been reduced to zero, as of any Distribution
Date, the
Class A-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.
CLASS A-M SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class A-M Interest Accrual
Amount over the
amount actually distributed to the Class A-M Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(c)(I)(A) and
6.01(I)(c)(1)(B).
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 COMPONENT ONE: The portion of the Class A-P Certificates
so
designated in Section 4.01(d).
CLASS A-P COMPONENT TWO: The portion of the Class A-P Certificates
so
designated in Section 4.01(d).
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: The Class A-R Certificates, 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),
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).
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<PAGE>
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(I)(b)(i)(EE).
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 (or, if an
Authenticating
Agent has been appointed pursuant to Section 4.06, the
Authenticating Agent),
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.
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(I)(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 (or, if an
Authenticating
Agent has been appointed pursuant to Section 4.06, the
Authenticating Agent),
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(I)(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 (or, if an
Authenticating
Agent has been appointed pursuant to Section 4.06, the
Authenticating Agent),
subordinated in right of payment to the Class A, Class M, Class
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<PAGE>
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(I)(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 (or, if an
Authenticating
Agent has been appointed pursuant to Section 4.06, the
Authenticating Agent),
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.
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(I)(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 (or, if an
Authenticating
Agent has been appointed pursuant to Section 4.06, the
Authenticating Agent),
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(I)(d)(5) (A) and (B).
CLASS LT-R INTEREST: The sole residual interest in the
Lower-Tier
REMIC.
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<PAGE>
CLASS M CERTIFICATES: The Class A-M and Class M-1 Certificates,
referred to collectively.
CLASS M PERCENTAGE: As of any Distribution Date, the percentage
obtained by dividing (i) the sum of the Class A-M Principal Balance
and the
Class M-1 Principal Balance by (ii) the Mortgage Pool Principal
Balance;
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, the sum of
the
Class A-M Principal Balance and the Class M-1 Principal
Balance.
CLASS M-1 CERTIFICATE: Any one of the Class M-1 Certificates
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),
subordinated in right of payment to the Class A Certificates and
the Class A-M
Certificates, substantially in the form of the Class M Certificate
set forth in
Exhibit D hereto.
CLASS M-1 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-1 Certificates minus
(i) any
Compensating Interest Shortfall allocated to the Class M-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 M-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 M-1
Certificates
on such Distribution Date pursuant to Section 6.05(d).
CLASS M-1 PRINCIPAL BALANCE: As of any Distribution Date, (a)
the
Class M-1 Principal Balance for the immediately preceding
Distribution Date less
(b) amounts distributed to the Class M-1 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-1 Certificates pursuant to Section 6.04);
provided that
the Class M-1 Principal Balance on the first Distribution Date
shall be the
Original Class M-1 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-1
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 sum of the Class A Principal Balance
and the Class
A-M Principal Balance.
CLASS M-1 SHORTFALL: With respect to any Distribution Date, the
amount
equal to the excess, if any, of the Class M-1 Interest Accrual
Amount over the
amount actually distributed to the Class M-1 Certificateholders on
such
Distribution Date pursuant to Section 6.01(I)(c)(2)(A) and
6.01(I)(c)(2)(B).
CLASS MT-R INTEREST: The sole residual interest in the
Middle-Tier
REMIC.
CLOSING DATE: September 26, 2006.
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.
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COMMISSION: The United States Securities and Exchange
Commission.
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.
COUNTERPARTY: JPMorgan Chase Bank, National Association, in its
capacity as cap counterparty under the Yield Maintenance
Agreements, and its
successors in interest.
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 Certficates). 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 and
the Class A-M Certificates shall be deemed to have a lower
numerical class
designation than the Class M-1 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.
CUSTODIAN: JPMorgan Chase Bank, N.A., and its permitted successors
in
interest.
CUT-OFF DATE: September 1, 2006.
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).
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).
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<PAGE>
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 have a Net Mortgage
Rate
less than the applicable 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
October 25, 2006.
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 and 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;
(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, A-1+ by
S&P and, if
rated by Fitch, F+ by Fitch;
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<PAGE>
(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, P-1 by Moody's and, if rated by Fitch, F+ by Fitch;
(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 acts as sponsor,
administrator
or the like and receives compensation with respect to such
investment) which may
be 12b-1 funds, as contemplated under the rules promulgated by the
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.
ERISA RESTRICTED
CERTIFICATE: Any Class B-3, Class B-4 or Class B-5
Certificate and any other Certificate, as 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.
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<PAGE>
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 Custodian or Trustee, as
applicable, 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 SPECIAL HAZARD LOSS: Any Special Hazard Loss, or portion
thereof, that exceeds the then applicable Special Hazard
Amount.
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended.
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
October
2036.
FITCH RATINGS: Fitch, Inc. or its successor in interest.
FNMA: The Federal National Mortgage Association, or any
successor
organization.
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, $30,728,827.98) equal to (X) prior to
the third
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, (Y) from the third
to (but
excluding) the fifth anniversary of the Cut-off Date, (a) 0.50% of
the aggregate
principal balance of all of the Mortgage Loans as of the most
recent anniversary
of the Cut-off Date
24
<PAGE>
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 and (Z) on and after
the fifth
anniversary of the Cut-off Date, zero.
GROUP ONE 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 in Mortgage Group One (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 in Mortgage Group One during the related
Due Period.
GROUP ONE MORTGAGE LOANS: The Mortgage Loans in Mortgage Group
One.
GROUP ONE MORTGAGE POOL PRINCIPAL BALANCE: As of any date of
determination, the aggregate of the Principal Balances of each
Outstanding
Mortgage Loan in Mortgage Group One 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.
GROUP ONE NON-PO ALLOCATED AMOUNT: At the time of any
determination,
the amount derived by (i) multiplying the outstanding Principal
Balance of each
Mortgage Loan in Mortgage Group One on such date of determination
by the Non-PO
Percentage with respect to such Mortgage Loan and (ii) summing the
results.
GROUP ONE REMITTANCE RATE: 6.25% per annum.
GROUP ONE STRIPPED INTEREST RATE: The excess of the weighted
average
Net Mortgage Rate of the Group One Mortgage Loans that are
Non-Discount Mortgage
Loans over the Group One Remittance Rate.
GROUP ONE SUBORDINATED AMOUNT: For any Distribution Date, the
excess
of the Group One Non-PO Allocated Amount immediately following the
preceding
Distribution Date (or as of the Cut-off Date if there is no
preceding
Distribution Date) over the aggregate outstanding Principal Balance
of the Class
1-A Certificates (prior to giving effect to distributions to be
made on such
Distribution Date and allocation of losses to be made on such
Distribution
Date).
GROUP TWO 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 in Mortgage Group Two (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 in Mortgage Group Two during the related
Due Period.
GROUP TWO MORTGAGE LOANS: The Mortgage Loans in Mortgage Group
Two.
GROUP TWO MORTGAGE POOL PRINCIPAL BALANCE: As of any date of
determination, the aggregate of the Principal Balances of each
Outstanding
Mortgage Loan in Mortgage Group Two 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.
GROUP TWO NON-PO ALLOCATED AMOUNT: At the time of any
determination,
the amount derived by (i) multiplying the outstanding Principal
Balance of each
Mortgage Loan in Mortgage Group Two on such date of determination
by the Non-PO
Percentage with respect to such Mortgage Loan and (ii) summing the
results.
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<PAGE>
GROUP TWO REMITTANCE RATE: 6.00% per annum.
GROUP TWO STRIPPED INTEREST RATE: The excess of the weighted
average
Net Mortgage Rate of the Group Two Mortgage Loans that are
Non-Discount Mortgage
Loans over the Group Two Remittance Rate.
GROUP TWO SUBORDINATED AMOUNT: For any Distribution Date, the
excess
of the Group Two Non-PO Allocated Amount immediately following the
preceding
Distribution Date (or as of the Cut-off Date, if there is no
preceding
Distribution Date) over the the aggregate outstanding Principal
Balance of the
Class 2-A Certificates (prior to giving effect to distributions to
be made on
such Distribution Date and allocation of losses to be made on such
Distribution
Date).
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 1-A10, Class 2-A8 and
Class A-P
Certificates), the calendar month immediately preceding the month
in which the
related Distribution Date occurs, in each case calculated on the
basis of a
360-day year of twelve 30-day months. With respect to any
Distribution Date and
the Class 1-A10 and Class 2-A8 Certificates, the period from and
including the
25th day of the month immediately preceding the month in which such
Distribution
Date occurs (or from the Closing Date in the case of the first
Distribution
Date), to but excluding, the 25th day of the month in which such
Distribution
Date occurs, in each case calculated on the basis of a 360-day year
of twelve
30-day months.
JPMMAC: J.P. Morgan Mortgage Acquisition Corp., a Delaware
corporation, and its successor in interest.
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.
LIBOR: With respect to any Distribution Date and the Certificate
Rates
on the Class 1-A10 and Class 2-A8 Certificates, LIBOR as determined
in
accordance with Section 6.07.
LIBOR BUSINESS DAY: Any day other than (i) a Saturday or a Sunday
or
(ii) a day on which banking institutions in the city of London,
England are
required or authorized by law to be closed.
LIBOR CERTIFICATES: The Class 1-A10 and Class 2-A8
Certificates,
collectively.
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
26
<PAGE>
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.
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.
LOCKOUT SHIFT PERCENTAGE: With respect to any Distribution Date,
the
percentage indiated below:
DISTRIBUTION DATE OCCURRING IN
LOCKOUT SHIFT PERCENTAGE
------------------------------
------------------------
October 2006 through September 2011..................
0%
October 2011 through September 2012..................
30%
October 2012 through September 2013..................
40%
October 2013 through September 2014..................
60%
October 2014 through September 2015..................
80%
October 2015 and thereafter..........................
100%
LONDON BUSINESS DAY: Any day on which banks are open for business
in
London and on which dealings in deposits in U.S. dollars are
transacted in the
London interbank market.
LOWER-TIER REMIC: The Lower-Tier REMIC as described in Section
2.04.
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LOWER-TIER REMIC INTEREST: Any one of the Classes of Lower-Tier
REMIC
Interests described in Section 2.04.
LOWER-TIER REMIC REGULAR INTEREST: Any one of the Lower-Tier
REMIC
Interests other than the Class LT-R Interest.
LOWER-TIER REMIC
SUBORDINATED BALANCE RATIO: The ratio among the
Uncertificated Principal Balances of each of the Lower-Tier REMIC
Regular
Interests ending with the designation "A" that is equal to the
ratio among, with
respect to each such Lower-Tier REMIC Regular Interest, the excess
of (x) the
aggregate Non-PO Percentage of the Principal Balance of each of the
Mortgage
Loans in the related Mortgage Group over (y) the aggregate class
principal
amounts of the Certificate Group related to such Mortgage
Group.
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.
MIDDLE-TIER REMIC: The Middle-Tier REMIC as described in Section
2.04.
MIDDLE-TIER REMIC INTEREST: Any one of the Classes of
Middle-Tier
REMIC Interests described in Section 2.04.
MIDDLE-TIER REMIC REGULAR INTEREST: Any one of the Middle-Tier
REMIC
Interests other than the Class MT-R Interest.
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.
MORTGAGE FILE: As to each Mortgage Loan, the items referred to
in
Exhibit B annexed hereto.
MORTGAGE GROUP: Pertaining to Mortgage Group One or Mortgage
Group
Two, as the case may be.
MORTGAGE GROUP ONE: The Mortgage Loans in the Trust Fund that
are
designated in the Mortgage Loan Schedule attached hereto as Exhibit
A-1 as
comprising Mortgage Group One.
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<PAGE>
MORTGAGE GROUP ONE SUBORDINATED PERCENTAGE: As of any
Distribution
Date, the difference between 100% and the Non-PO Class 1-A
Percentage.
MORTGAGE GROUP ONE SUBORDINATED PREPAYMENT PERCENTAGE: As of
any
Distribution Date, the difference between 100% and the Non-PO Class
1-A
Prepayment Percentage.
MORTGAGE GROUP TWO: The Mortgage Loans in the Trust Fund that
are
designated in the Mortgage Loan Schedule attached herero as Exhibit
A-2 as
comprising Mortgage Group Two.
MORTGAGE GROUP TWO SUBORDINATED PERCENTAGE: As of any
Distribution
Date, the difference between 100% and the Non-PO Class 2-A
Percentage.
MORTGAGE GROUP TWO SUBORDINATED PREPAYMENT PERCENTAGE: As of
any
Distribution Date, the difference between 100% and the Non-PO Class
2-A
Prepayment Percentage.
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;
and (xi) the
amount of the current Monthly Payment.
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
$1,024,294,266.
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.
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<PAGE>
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: Any Mortgage Loan having a Net
Mortgage
Rate in excess of the applicable Remittance Rate.
NON-MERS MORTGAGE LOAN: Any Mortgage Loan other than a MERS
Mortgage
Loan.
NON-PO CLASS 1-A OPTIMAL PRINCIPAL AMOUNT: With respect to any
Distribution Date, the lesser of (a) the Non-PO Class 1-A Principal
Balance and
(b) the sum of:
(i) the Non-PO Class 1-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
Group
One Mortgage Loans which were outstanding during such Due
Period;
(ii) the Non-PO Class 1-A Prepayment Percentage of the
applicable Non-PO Percentage of all Principal Prepayments made on
any
Group One Mortgage Loan during the related Principal Prepayment
Period;
(iii) with respect to each Mortgage Loan not described in
(iv) below, the Non-PO Class 1-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
with
respect to a Group One Mortgage Loan, 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 Group One Mortgage Loan which has
become a Liquidated Mortgage Loan during the related Principal
Prepayment Period, the lesser of (A) the Non-PO Class 1-A
Percentage
of the 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 1-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 Group One Mortgage Loan repurchased
during the related Principal Prepayment Period pursuant to
Section
2.02, 3.01, 5.21 or 11.01, an amount equal to the Non-PO Class
1-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 1-A Certificateholders); and
(vi) on or after the Credit Support Depletion Date, the
excess of the Non-PO Class 1-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
Group
One Non-PO Allocated Amount, as of the preceding Distribution
Date.
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<PAGE>
NON-PO CLASS 2-A OPTIMAL PRINCIPAL AMOUNT: With respect to any
Distribution Date, the lesser of (a) the Non-PO Class 2-A Principal
Balance and
(b) the sum of:
(i) the Non-PO Class 2-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
Group
Two Mortgage Loans which were outstanding during such Due
Period;
(ii) the Non-PO Class 2-A Prepayment Percentage of the
applicable Non-PO Percentage of all Principal Prepayments made on
any
Group Two
Mortgage Loan during the related Principal Prepayment
Period;
(iii) with respect to each Mortgage Loan not described in
(iv) below, the Non-PO Class 2-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
with
respect to a Group Two Mortgage Loan, 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 Group Two Mortgage Loan which has
become a Liquidated Mortgage Loan during the related Principal
Prepayment Period, the lesser of (A) the Non-PO Class 2-A
Percentage
of the 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 2-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 Group Two Mortgage Loan repurchased
during the related Principal Prepayment Period pursuant to
Section
2.02, 3.01, 5.21 or 11.01, an amount equal to the Non-PO Class
2-A
Prepayment Percentage of the applicable Non-PO 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 2-A
Certificateholders); and
(vi) on or after the Credit Support Depletion Date, the
excess of the Non-PO Class 2-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
Group
Two Non-PO Allocated Amount, as of the preceding Distribution
Date.
NON-PO CLASS 1-A PERCENTAGE: As of any Distribution Date, a
fraction,
expressed as a percentage (which shall never exceed 100%), the
numerator of
which is the Non-PO Class 1-A Principal Balance and the denominator
of which is
the Group One Non-PO Allocated Amount as of the immediately
preceding Due Date.
NON-PO CLASS 2-A PERCENTAGE: As of any Distribution Date, a
fraction,
expressed as a percentage (which shall never exceed 100%), the
numerator of
which is the Non-PO Class 2-A Principal Balance and the denominator
of which is
the Group Two Non-PO Allocated Amount of the immediately preceding
Due Date.
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<PAGE>
NON-PO CLASS 1-A PREPAYMENT PERCENTAGE: As of any Distribution Date
up
to and including the Distribution Date in September 2011, 100%; as
of any
Distribution Date in the first year thereafter, the Non-PO Class
1-A Percentage
plus 70% of the Mortgage Group One Subordinated Percentage for such
Distribution
Date; as of any Distribution Date in the second year thereafter,
the Non-PO
Class 1-A Percentage plus 60% of the Mortgage Group One
Subordinated Percentage
for such Distribution Date; as of any Distribution Date in the
third year
thereafter, the Non-PO Class 1-A Percentage plus 40% of the
Mortgage Group One
Subordinated Percentage for such Distribution Date; as of any
Distribution Date
in the fourth year thereafter, the Non-PO Class 1-A Percentage plus
20% of the
Mortgage Group One Subordinated Percentage for such Distribution
Date; and as of
any Distribution Date after the fourth year thereafter, the Non-PO
Class 1-A
Percentage; provided that, if the Non-PO Class 1-A Percentage as of
any such
Distribution Date is greater than the Non-PO Class 1-A Percentage
on the first
Distribution Date, the Non-PO Class 1-A Prepayment Percentage shall
be 100%; and
provided further, however, that whenever the Non-PO Class 1-A
Percentage equals
0%, the Non-PO Class 1-A Prepayment Percentage shall equal 0%; and
provided
further that no reduction of the Non-PO Class 1-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, (i) the aggregate outstanding Principal Balance
of Mortgage
Loans with respect to both Mortgage Groups, each taken
individually, delinquent
60 days or more (including for this purpose any Mortgage Loans in
foreclosure
and Mortgage Loans with respect to which the related Mortgaged
Property has been
acquired by the Trust Fund) does not exceed 50% of the Mortgage
Group One
Subordinated Percentage of the Mortgage Pool Principal Balance with
respect to
Mortgage Group One as of such date and (ii) cumulative Realized
Losses with
respect to both Mortgage Groups, each taken individually, do not
exceed (a) 30%
of the related Subordinated Percentage of the Mortgage Pool
Principal Balance
with respect to the related Mortgage Group as of the date of
issuance of the
Certificates (the related "Original Subordinated Principal
Balance") if such
Distribution Date occurs between and including October 2011 and
September 2012,
(b) 35% of the related Original Subordinated Principal Balance if
such
Distribution Date occurs between and including October 2012 and
September 2013,
(c) 40% of the related Original Subordinated Principal Balance if
such
Distribution Date occurs between and including October 2013 and
September 2014,
(d) 45% of the related Original Subordinated Principal Balance if
such
Distribution Date occurs between and including October 2014 and
September 2015,
and (e) 50% of the related Original Subordinated Principal Balance
if such
Distribution Date occurs during or after October 2015.
NON-PO CLASS 2-A PREPAYMENT PERCENTAGE: As of any Distribution Date
up
to and including the Distribution Date in September 2011, 100%; as
of any
Distribution Date in the first year thereafter, the Non-PO Class
2-A Percentage
plus 70% of the Mortgage Group Two Subordinated Percentage for such
Distribution
Date; as of any Distribution Date in the second year thereafter,
the applicable
Non-PO Class 2-A Percentage plus 60% of the Mortgage Group Two
Subordinated
Percentage for such Distribution Date; as of any Distribution Date
in the third
year thereafter, the Non-PO Class 2-A Percentage plus 40% of the
Mortgage Group
Two Subordinated Percentage for such Distribution Date; as of any
Distribution
Date in the fourth year thereafter, the applicable Non-PO Class 2-A
Percentage
plus 20% of the Mortgage Group Two Subordinated Percentage for such
Distribution
Date; and as of any Distribution Date after the fourth year
thereafter, the
Non-PO Class 2-A Percentage; provided that, if the Non-PO Class 2-A
Percentage
on the first Distribution Date is greater than the Non-PO Class 2-A
Percentage,
the Non-PO Class 2-A Prepayment Percentage shall be 100%; and
provided further,
however, that whenever the Non-PO Class 2-A Percentage equals 0%,
the Non-PO
Class 2-A Prepayment Percentage shall equal 0%; and provided
further that no
reduction of the Non-PO Class 2-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,
(i) the aggregate outstanding Principal Balance of Mortgage Loans
with respect
to both Mortgage Groups, each taken individually, delinquent 60
days or more
(including for this purpose any Mortgage Loans in foreclosure and
Mortgage Loans
with respect to which the related Mortgaged Property has been
acquired
32
<PAGE>
by the Trust Fund) does not exceed 50% of the Mortgage Group Two
Subordinated
Percentage of the Mortgage Pool Principal Balance with respect to
Mortgage Group
Two as of such date and (ii) cumulative Realized Losses with
respect to both
Mortgage Groups, each taken individually, do not exceed (a) 30% of
the related
Subordinated Percentage of the Mortgage Pool Principal Balance with
respect to
the related Mortgage Group as of the date of issuance of the
Certificates (the
related "Original Subordinated Principal Balance") if such
Distribution Date
occurs between and including October 2011 and September 2012, (b)
35% of the
related Original Subordinated Principal Balance if such
Distribution Date occurs
between and including October 2012 and September 2013, (c) 40% of
the related
Original Subordinated Principal Balance if such Distribution Date
occurs between
and including October 2013 and September 2014, (d) 45% of the
related Original
Subordinated Principal Balance if such Distribution Date occurs
between and
including October 2014 and September 2015, and (e) 50% of the
related Original
Subordinated Principal Balance if such Distribution Date occurs
during or after
October 2015.
NON-PO CLASS 1-A PRINCIPAL BALANCE: As of any Distribution Date,
(a)
the Non-PO Class 1-A Principal Balance for the immediately
preceding
Distribution Date less (b) amounts distributed (or deemed
distributed) to the
Class 1-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
1-A
Certificates pursuant to Section 6.04); provided that the Non-PO
Class 1-A
Principal Balance on the first Distribution Date shall be the
Original Non-PO
Class 1-A Principal Balance.
NON-PO CLASS 2-A PRINCIPAL BALANCE: As of any Distribution Date,
(a)
the Non-PO Class 2-A Principal Balance for the immediately
preceding
Distribution Date less (b) amounts distributed (or deemed
distributed) to the
Class 2-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
2-A
Certificates pursuant to Section 6.04); provided that the Non-PO
Class 2-A
Principal Balance on the first Distribution Date shall be the
Original Non-PO
Class 2-A Principal Balance.
NON-PO CLASS 1-A PRINCIPAL PAYMENT RULES:
(I) With respect to any Distribution Date up to and including
the
Credit Support Depletion Date, distributions to the Class 1-A
Certificateholders
pursuant to Section 6.01(b)(ii)(A) shall be made in the following
amounts and
priority:
Concurrently:
(1) 38.5362107465% as follows:
(A) first, to the Class 1-A16 Certificates, up to the Class
1-A16 Lockout Principal Distribution Amount;
(B) second, to the Class 1-A17, Class 1-A18 and Class 1-A19
Certificates, concurrently, as follows:
(i) 34.493564146% to the Class 1-A17 Certificates,
until the Outstanding Certificate Principal Balance of such Class
has been
reduced to zero;
(ii) 65.506435854%, sequentially, to the Class
1-A18 Certificates and the Class 1-A19 Certificates, in that order,
until the
Outstanding Certificate Principal Balance of each such Class has
been reduced to
zero;
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<PAGE>
(C) third, to the Class 1-A14 and Class 1-A15 Certificates,
pro rata, based upon their outstanding principal balances, until
the Outstanding
Certificate Principal Balance of each such Class has been reduced
to zero;
(D) fourth, to the Class 1-A16 Certificates, until the
Outstanding Certificate Principal Balance of such Class has been
reduced to
zero;
(2) 61.4637892535% as follows:
(A) first, to the Class 1-A9 Certificates, up to the Class
1-A9 Lockout Principal Distribution Amount;
(B) second, concurrently:
(i) 54.9469372125%, as follows:
(a) first, to the Class 1-A1, Class A-R
and Class 1-A2 Certificates, pro rata, based upon their outstanding
principal
balances, until the Outstanding Certificate Principal Balance of
each such Class
has been reduced to zero;
(b) second, to the Class 1-A3 and Class
1-A4 Certificates, pro rata, based upon their outstanding principal
balances,
until the Outstanding Certificate Principal Balance of each such
Class has been
reduced to zero;
(c) third, sequentially to the Class
1-A5, Class 1-A6, Class 1-A7 and Class 1-A8 Certificates, in that
order, until
the Outstanding Certificate Principal Balance of each such class
has been
reduced to zero;
(ii) 45.0530627875%, as follows:
(a) first, to the Class 1-A10
Certificates, up to an amount equal to 1% of the amount payable
pursuant to this
clause (ii);
(b) second, on or after the Distribution
Date in April 2007, to the Class 1-A11 Certificates, up to an
amount equal to
the lesser of (x) $422,000 and (y) an amount equal to 99% of the
amount
remaining after payments made pursuant to clause (ii)(a) above;
(c) third, on or after the Distribution
Date in October 2007, sequentially, to the Class 1-A12 Certificates
and the
Class 1-A13 Certificates, in that order, up to an aggregate amount
equal to the
lesser of (x) $208,000 and (y) an amount equal to 99% of the amount
remaining
after payments made pursuant to clause (ii)(b) above;
(d) fourth, sequentially, to the Class
1-A10, Class 1-A11, Class 1-A12 and Class 1-A13 Certificates, in
that order,
until the Outstanding Certificate Principal Balance of each such
Class has been
reduced to zero; and
(C) third, to the Class 1-A9 Certificates, until the
Outstanding Certificate Principal Balance of such class has been
reduced to
zero;
(II) With respect to any Distribution Date 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
34
<PAGE>
Class 1-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 CLASS 2-A PRINCIPAL PAYMENT RULES:
(I) With respect to any Distribution Date up to and including
the
Credit Support Depletion Date, distributions to the Class 2-A
Certificateholders
pursuant to Section 6.01(b)(ii)(B) shall be made in the following
amounts and
priority:
first, to the Class 2-A1 Certificates, up to the Class 2-A1
Lockout
Principal Distribution Amount;
second, concurrently:
(1) 20.2792840097%, as follows:
(A) first, to the Class 2-A2 Certificates, until the
Outstanding Certificate Principal Balance of such Class has been
reduced to
zero;
(B) second, to the Class 2-A4 Certificates, until the
Outstanding Certificate Principal Balance of such Class has been
reduced to
zero;
(2) 79.7207159903%, as follows:
(A) first, on or after the Distribution Date in October
2009, to the Class 2-A5 Certificates, up to an amount equal to 99%
of the amount
payable pursuant to this clause (2);
(B)
second, on or after the Distribution Date in October
2010, to the Class 2-A6 Certificates, up to an amount equal to 99%
of the amount
remaining after payments made pursuant to clause (2)(A) above;
(C) third, on or after the Distribution Date in October
2011, to the Class 2-A7 Certificates, up to an amount equal to 99%
of the amount
remaining after payments made pursuant to clause (2)(B) above;
(D) fourth, to the Class 2-A8 Certificates, up to the amount
necessary to reduce the aggregate Outstanding Certificate Principal
Balance of
such Class to its Targeted Principal Balance;
(E) fifth, to the Class 2-A9 Certificates, until the
Outstanding Certificate Principal Balance of such Class has been
reduced to
zero;
(F) sixth, to the Class 2-A8 Certificates, until the
Outstanding Certificate Principal Balance of such Class has been
reduced to
zero;
(G) seventh, sequentially, to the Class 2-A5, Class 2-A6 and
2-A7 Certificates, in that order, until the Outstanding Certificate
Principal
Balance of each such Class has been reduced to zero; and
third, to the Class 2-A1 Certificates, until the Outstanding
Certificate Principal Balance of such Class has been reduced to
zero.
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<PAGE>
(II) With respect to any Distribution Date after the Credit
Support
Depletion Date, distributions pursuant to Section 6.01(b)(ii)(B)
shall be made
pro rata among the outstanding Classes of Class 2-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
applicable Remittance Rate.
NON-PO PRINCIPAL BALANCE: In the case of a Non-Discount Mortgage
Loan,
the Scheduled Principal Balance of such Mortgage Loan and, in the
case of a
Discount Mortgage Loan, the product of (i) the Scheduled Principal
Balance of
such Mortgage Loan and (ii) the Non-PO Percentage for such Mortgage
Loan.
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 or Component in
Section
4.01(d).
ORIGINAL CLASS A PRINCIPAL BALANCE:
$980,761,758.
ORIGINAL NON-PO CLASS 1-A PRINCIPAL BALANCE: $507,501,854.
ORIGINAL NON-PO CLASS 2-A PRINCIPAL BALANCE: $472,011,180.
ORIGINAL CLASS M PRINCIPAL BALANCE:
$ 29,704,500.
ORIGINAL CLASS B PRINCIPAL BALANCE:
$ 13,828,008.
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 A-M:
3.15%
Class M-1:
1.35%
Class B-1:
0.80%
Class B-2:
0.50%
Class B-3:
0.30%
36
<PAGE>
Class B-4:
0.15%
OUTSTANDING CERTIFICATE GROUP: With respect to any Distribution
Date,
any Certificate Group which has not become a Retired Certificate
Group on any
prior Distribution Date.
ORIGINAL SUBORDINATED PRINCIPAL BALANCE: With respect to any
Mortgage
Group, the related Subordinated Amount, as of the date of issuance
of the
Certificates.
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE: With respect to any
Class
of Certificates of Certificates or Component (other than the Class
1-AX, Class
2-A3 and Class 2-AX Certificates) and any Distribution Date, the
Original
Certificate Principal Balance of such Class or Component minus the
sum of (i)
any distributions of principal made on such Class or Component
prior to such
Distribution Date and (ii) any Realized Losses allocated to such
Class prior to
such Distribution Date plus, in the case of the Class 1-A13
Certificates, on
each Distribution Date prior to the Class 1-A13 Accretion
Termination Date, the
amounts calculated for such Distribution Date pursuant to
Section
6.01(I)(b)(i)(FF) and in the case of the 2-A9 Accretion Termination
Date, the
amounts calculated for such Distribution Date pursuant to
Section
6.01(I)(b)(i)(GG); provided, 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 of Class M
Certificates then
outstanding having the highest numerical class designation (for the
purposes of
this paragraph, the Class M-1 Certificates shall be deemed to have
a higher
numerical class designation than the Class A-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 sum of the Outstanding Certificate Principal
Balances of all
Classes of Certificates (other than the Class of Class M
Certificates then
outstanding having the highest numerical class designation).
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.
OVERCOLLATERALIZED GROUP: As defined in Section
6.01(I)(b)(ix)(B).
PASS-THRU ENTITY: A "Pass-Thru Entity" as defined in Section
860E(e)(6) of the Code.
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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
1-AX Notional Amount, Class 2-A3 Notional Amount and Class 2-AX
Notional Amount
in the case of the Class 1-AX, Class 2-A3 and Class 2-AX
Certificates,
respectively) of such Certificate by the aggregate of the
Outstanding
Certificate Principal Balances (or the Class 1-AX Notional Amount,
Class 2-A3
Notional Amount and Class 2-AX Notional Amount in the case of the
Class 1-AX,
Class 2-A3 and Class 2-AX Certificates, respectively) 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.
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 applicable Remittance Rate over the
applicable
Net Mortgage Rate and the denominator of which equals the
applicable Remittance
Rate.
PLAN: As defined in Section 4.02(d)(i).
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 3.03, 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.
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<PAGE>
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.
PTCE: As defined in Section 4.02(d)(i).
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, Moody's and Fitch 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.
RATE ADJUSTMENT DATE: The second LIBOR Business Day prior to the
first
day of each Interest Accrual Period after the initial Interest
Accrual Period.
RATE CAP CEILING: With respect to the Class 1-A10 Yield
Maintenance
Agreement and the applicable Distribution Date, the rate specified
in Exhibit U
under the heading "Ceiling" for that Distribution Date, and with
respect to the
Class 2-A8 Yield Maintenance Agreement and the applicable
Distribution Date, the
rate specified in Exhibit U-1 under the heading "Ceiling" for that
Distribution
Date.
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: With respect to each Class of Certificates (other
than
the Class 1-A10 and Class 2-A8 Certificates), the close of business
of the last
Business Day of the month preceding the month
39
<PAGE>
of the related Distribution Date. With respect to the Class 1-A10
and Class 2-A8
Certificates, the close of business on the business day immediately
preceding
the related Distribution Date.
REFERENCE BANKS: Four majory banks in the London interbank
market
selected by the Counterparty.
REGULATION AB: Subpart 229.1100 - Asset Backed Securities
(Regulation
AB), 17 C.F.R. Sections 229.1100-229.1123, as such may be amended
from time to
time, and subject to such clarification and interpretation as have
been provided
by the Commission in the adopting release (Asset-Backed Securities,
Securities
Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005))
or by the
staff of the Commission, or as may be provided by the Commission or
its staff
from time to time.
RELEVANT MORTGAGE LOAN: The meaning specified in Section 5.01.
RELEVANT SALE AGREEMENT: With respect to any reference to CHF
as
Seller, the Mortgage Loan Sale Agreement dated as of September 1,
2006 between
the Depositor and CHF, and with respect to any reference to JPMMAC
as Seller,
the Mortgage Loan Sale Agreement dated as of September 1, 2006
between the
Depositor and JPMMAC.
RELEVANT SELLER: With respect to the Mortgage Loan Sale
Agreement
dated as of September 1, 2006 between the Depositor and CHF, CHF,
and with
respect to the Mortgage Loan Sale Agreement dated as of September
1, 2006
between the Depositor and JPMMAC, JPMMAC.
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: Each of the Lower-Tier REMIC, the Middle-Tier REMIC
and
the Upper-Tier REMIC.
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.
REMIC REPORTING AGENT: As defined in Section 7.02(b).
REMITTANCE RATE: The Group One Remittance Rate or the Group Two
Remittance Rate, as applicable.
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.
RESERVE FUND: As defined in Section 5.29.
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
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<PAGE>
A-R Certificates, other than, in the case of both (i) and (ii),
amounts
attributable to the Class LT-R Interest or the Class MT-R
Interest.
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.
RETIRED CERTIFICATE GROUP: With respect to any Distribution Date,
any
Certificate Group with respect to which the aggregate Outstanding
Certificate
Principal Balance is reduced to zero on or before such Distribution
Date.
S&P: Standard & Poor's, a division of The McGraw-Hill
Companies, Inc.
or its successor in interest.
SALE AGREEMENTS: The Mortgage Loan Sale Agreement dated as of
September 1, 2006 between the Depositor and CHF and the Mortgage
Loan Sale
Agreement dated as of September 1, 2006 between the Depositor and
JPMMAC.
SARBANES-OXLEY CERTIFICATION: The meaning specified in Section
5.24(f).
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).
SECURITIES ACT: The Securities Act of 1933, as amended.
SELLERS: CHF and JPMMAC, referred to collectively.
SERVICER: Chase or any successor under this Agreement.
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 CRITERIA: The "servicing criteria" set forth in Item
1122(d)
of Regulation AB, as such may be amended from time to time.
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<PAGE>
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: 0.2560% 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.
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, $10,242,942.66. 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).
SUBCONTRACTOR: Any vendor, subcontractor or other Person that is
not
responsible for the overall servicing (as "servicing" is commonly
understood by
participants in the mortgage-backed securities market) of Mortgage
Loans but
performs one or more discrete functions identified in Item
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<PAGE>
1122(d) of Regulation AB with respect to Mortgage Loans as
determined by and
under the direction or authority of the Servicer or a
Sub-Servicer.
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) (1)
the sum of:
(i) the applicable 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 which were
outstanding
during such Due Period; (ii) the applicable Subordinated 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 applicable
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 Mortgage Loan (net of any
unreimbursed
Advances) that was not included in the Group One Class A-P Amount,
the Group Two
Class A-P Amount, the Non-PO Class 1-A Optimal Principal Amount or
Non-PO Class
2-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 applicable Subordinated Prepayment
Percentage of
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: The Mortgage Group One Subordinated
Percentage or the Mortgage Group Two Subordinated Percentage, as
the case may
be.
SUBORDINATED PREPAYMENT PERCENTAGE: The Mortgage Group One
Subordinated Prepayment Percentage or the Mortgage Group Two
Subordinated
Prepayment Percentage, as the case may be.
SUB-SERVICER: Any Person that services Mortgage Loans on behalf of
the
Servicer or any Sub-Servicer and is responsible for the performance
(whether
directly or through Subservicers or Subcontractors) of a
substantial portion of
the material servicing functions required to be performed by the
Servicer under
this Agreement that are identified in Item 1122(d) of Regulation
AB. Any
Sub-Servicer shall meet the qualifications set forth in Section
5.02.
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.
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.
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<PAGE>
SUBSTITUTE EXCESS INTEREST: As defined in Section 3.03.
TARGETED PRINCIPAL BALANCE: With respect to the Class 2-A8
Certificates, the aggregate amount specified for such Class for
such
Distribution Date on Exhibit V hereto.
TELERATE SCREEN PAGE 3750: The display designated as page 3750 on
the
Dow Jones Telerate Service or such other page as may replace page
3750 on that
service for the purpose of displaying London interbank offered
rates of major
banks.
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) the
Trust's rights
under the Yield Maintenance Agreements, (iv) property which secured
a Mortgage
Loan and which has been acquired by foreclosure or deed in lieu of
foreclosure,
(v) Standard Hazard Policies and any other insurance policies, and
the proceeds
thereof and (vi) any proceeds of any of the foregoing.
TRUSTEE: The Bank of New York, a New York banking corporation 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.
UNDERCOLLATERALIZED POOL: As defined in Section
6.01(I)(b)(ix)(B).
UPPER-TIER REMIC: The Upper-Tier REMIC as described in Section
2.04.
UPPER-TIER REMIC
REGULAR INTERESTS: (i) Each of the Classes of
Certificates (other than the Class A-R Certificate, Class A-P
Certificate, Class
1-A10 Certificate and Class 2-A8 Certificate), (ii) each of the
Class A-P
Component One and Class A-P Component Two and (iii) the rights
under each Class
of the Class 1-A10 and Class 2-A8 Certificates other than the
rights with
respect to Basis Risk Shortfall Carryover Amounts.
U.S. PERSON: A "United States Person" as defined in Section
7701(a)(30) of the Code.
YIELD MAINTENANCE AGREEMENTS: The yield maintenance agreements
described in Section 5.29 and set forth in Exhibit U and Exhibit
U-1 hereto.
YIELD MAINTENANCE AGREEMENT REMITTANCE DATE: The day that is two
New
York business days prior to each Distribution Date, provided that
if such day is
not a New York business day, such Yield Maintenance Agreement
Remittance Date
shall be the next preceding New York business day.
[END OF ARTICLE I]
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<PAGE>
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 Custodian on behalf of 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 bearing all intervening
endorsements,
endorsed "Pay to the order of ______, without recourse" and signed
in the name
of the last endorsee by an authorized officer.
(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
of the original that was sent for recording, certified by the
Relevant Seller.
(ii) With respect to each Non-MERS Mortgage Loan which is not a
Co-op Loan:
(A) The original Assignment of Mortgage to "The Bank of New York,
as
trustee (Chase Mortgage Finance Corporation)," which assignment
shall be in form
and substance acceptable for recording, or a copy certified by the
Relevant
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, or in the event
such
original title policy is unavailable a copy of the related policy
(provided that
use of a copy is acceptable to the related title insurance or
escrow company),
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 Relevant Seller of the original Assignment
of Mortgage
together with a certificate of the Relevant 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
45
<PAGE>
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 Relevant Seller, of such original document
together with
certificate of Relevant 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, a copy of any applicable power of
attorney.
(iii) With respect to each Co-op Loan:
(A) (I) The original
Mortgage Note bearing all intervening
endorsements, endorsed "Pay to the order of ________, without
recourse" and signed in the name of the last endorsee by an
authorized
officer.
(B) The original
Mortgage entered into by the Mortgagor with respect
to such Co-Op Loan.
(C) The original
Assignment of Mortgage to "The Bank of New York 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 or if the original of such document has not
been
returned from the applicable public recording office, a true
certified copy of the document sent for recording.
(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 "The Bank of New York as trustee" or to
blank,
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 or to
blank, 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
46
<PAGE>
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.
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
47
<PAGE>
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.
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 any Seller to the Depositor is characterized
as a pledge
and not a sale, then the Depositor shall be deemed to have
transferred to the
Trustee all of the Depositor's right, title and interest in, to and
under the
obligations of such Seller deemed to be secured by said pledge; and
it is the
intention of this Agreement that the Depositor shall also be deemed
to have
granted to the Trustee a first priority security interest in all of
the
Depositor's right, title, and interest in, to and under the
obligations of such
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 Sellers contained in the Sale
Agreements
and described in Section 3.01 hereof and the benefit of the
repurchase
obligations of the Sellers described in Sections 2.02 and 3.01
hereof and the
obligations of the Sellers contained in the Sale Agreements to
take, at the
request of the Depositor or the Trustee, all action on its part
which is
reasonably necessary to ensure the enforceability of a Mortgage
Loan.
The 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 by the
48
<PAGE>
Custodian on the Trustee's behalf 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 the Custodian holds and will hold
on the
Trustee's behalf 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
Relevant
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
may accept
delivery of such Mortgage Files by the Custodian on its behalf. The
Custodian
will deliver a copy of the Exception Report to the Depositor and
the Trustee
The Custodian, on the Trustee's behalf, 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
Custodian on
the Trustee's behalf finds any document or documents constituting a
part of a
Mortgage File to be missing or defective (that is, mutilated,
damaged, defaced
or unexecuted) in any material respect, the Custodian on the
Trustee's behalf
shall promptly (and in any event within no more than five Business
Days) after
such finding so notify the Servicer, the Relevant Seller, the
Trustee and the
Depositor. In addition, the Custodian on the Trustee's behalf shall
also notify
the Servicer, the Relevant Seller, the Trustee 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 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 Custodian and 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 Depositor shall
request that the
Relevant 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 Relevant Seller was notified of such
omission or defect
and, if the Relevant Seller does not correct or cure such omission
or defect
within such period, that the Relevant Seller purchase such Mortgage
Loan from
the Trustee within 90 days from the date the Depositor notified the
Relevant
Seller and the Trustee 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
Relevant 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 Relevant 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 Relevant 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.
49
<PAGE>
Within 280 days of the Closing Date, the Trustee based solely
on
information provided to it by the Custodian 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 Paying Agent
to
make appropriate elections to treat the Trust Fund as comprising
three REMICs
(the Lower-Tier REMIC, the Middle-Tier REMIC and the Upper-Tier
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 Lower-Tier REMIC
shall hold as
assets all property of the Trust Fund other than (i) the Lower-Tier
REMIC
Interests and the Middle-Tier REMIC Interests and (ii) the Yield
Maintenance
Agreements and the Reserve Fund. Each of the Lower-Tier REMIC
Regular Interests
is hereby designated a "regular interest" (within the meaning of
Section
860G(a)(1) of the Code) in the Lower-Tier REMIC. The Middle-Tier
REMIC shall
hold as assets the several classes of uncertificated Lower-Tier
REMIC Regular
Interests. Each of the Middle-Tier REMIC Regular Interests is
hereby designated
a "regular interest" (within the meaning of Section 860G(a)(1) of
the Code) in
the Middle-Tier REMIC. The Upper-Tier REMIC shall hold as assets
the several
classes of uncertificated Middle-Tier REMIC Regular Interests. Each
of the
Upper-Tier REMIC Regular Interests is hereby designated as a
"regular interest"
(within the meaning of Section 860G(a)(1) of the Code) in the
Upper-Tier REMIC.
The Class LT-R Interest is hereby designated as the sole residual
interest
(within the meaning of Section 860G(a)(2) of the Code) in the
Lower-Tier REMIC.
The Class MT-R Interest is hereby designated as the sole residual
interest
(within the meaning of Section 860G(a)(2) of the Code) in the
Middle-Tier 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 Upper-Tier
REMIC. The
Class A-R Certificate evidences ownership of the Class LT-R
Interest, the Class
MT-R Interest and the Residual Interest. All interests described in
this Section
2.04(a) shall be designated as such on the Startup Day.
50
<PAGE>
LOWER-TIER REMIC
The following table specifies the class designation, initial
principal
amount, pass-through rate and related Mortgage Group for each class
of
Lower-Tier REMIC Interest.
<TABLE>
<CAPTION>
Lower-Tier REMIC Interest Initial Principal Amount
Pass-Through
Rate Related
Mortgage Group
------------------------- ------------------------
----------------- ----------------------
<S>
<C>
<C>
<C>
LT-R
(1)
(1)
N/A
LTA-P Component One
$932,875.43
0.00%
N/A
LTA-P Component Two
$315,848.81
0.00%
N/A
LT1-AX
(2)
6.25%
N/A
LT2-AX
(3)
6.00%
N/A
LT1-A
(4)
6.25%
Mortgage Group One
LT1-B
(5)
6.25%
Mortgage Group One
LT2-A
(6)
6.00%
Mortgage Group Two
LT2-B
(5)
6.00%
Mortgage Group Two
</TABLE>
(1) The Class LT-R
Interest shall represent the sole class of residual interest
in
the Lower-Tier REMIC. The Class LT-R Interest will not have a
principal
amount or an interest rate. The Class LT-R Interest shall be
represented by
the
Class A-R Certificate.
(2) The Class LT1A-X
Interest is an interest only interest, has no principal
balance, is not entitled to payments of principal and will bear
interest on
its
notional amount. The notional amount of the Class LT1A-X Interest
shall
equal the Class 1-AX Notional Amount.
(3) The Class LT2A-X
Interest is an interest only interest, has no principal
balance, is not entitled to payments of principal and will bear
interest on
its
notional amount. The notional amount of the Class LT2A-X Interest
shall
equal the Class 2-AX Notional Amount.
(4) The initial
principal amount of the Class LT1-A Interest shall equal 1% of
the
Group One Subordinated Amount as of the first Distribution
Date.
(5) The initial
principal amount of each Lower-Tier REMIC Interest ending with
the
designation "B" shall equal the excess of (i) the initial Group
One
Non-PO Allocated Amount (in the case of the Class LT1-B Interest)
or the
initial Group Two Non-PO Allocated Amount (in the case of the Class
LT2-B
Interest) over (ii) the initial principal amount of the Lower-Tier
REMIC
Interest ending with the designation "A" that is related to the
same
Mortgage Group.
(6) The initial
principal amount of the Class LT2-A Interest shall equal 1% of
the
Group Two Subordinated Amount as of the first Distribution
Date.
Interest shall be payable to, and shortfalls and losses are
allocable
to, the Class LT1-AX Interest as such amounts are payable or
allocable to the
Class 1-AX Certificates. Interest shall be payable to, and
shortfalls and losses
are allocable to, the Class LT2-AX Interest as such amounts are
payable or
allocable to the Class 2-AX Certificates.
Principal shall be payable to, and shortfalls, losses, prepayments
and
increases in principal amount related to Subsequent Recoveries are
allocable to,
the Class LTA-P Component One Interest as such amounts are payable
or allocable
to Class A-P Component One. Principal shall be payable to, and
shortfalls,
losses, prepayments and increases in principal amount related to
Subsequent
Recoveries are allocable to, the Class LTA-P Component Two Interest
as such
amounts are payable or allocable to Class A-P Component Two.
51
<PAGE>
After the foregoing allocations and distributions are made to
the
Class LT1-AX Interest, Class LT2-AX Interest, the Class LTA-P
Component One
Interest and the Class LTA-P Component Two Interest, distributions
shall be
deemed to be made and Realized Losses shall be deemed to be
allocated to the
other Lower-Tier REMIC Regular Interests first, so as to keep the
Uncertificated
Principal Balance of each Lower-Tier REMIC Regular Interest ending
with the
designation "A" equal to 1% of the excess of (x) the Group One
Non-PO Allocated
Amount (in the case of the Class LT1-A Interest) or the Group Two
Non-PO
Allocated Amount (in the case of the Class LT2-A Interest) over (y)
the
aggregate class principal amounts of the Class 1-A Certificates (in
the case of
the Class LT1-A Interest) or the Class 2-A Certificates (in the
case of the
Class LT2-A Interest) (except that if 1% of any such excess is
greater than the
principal amount of the corresponding Lower-Tier REMIC Regular
Interest ending
with the designation "A", the least amount of principal and
Realized Losses
shall be distributed and allocated to such Lower-Tier REMIC Regular
Interests
such that the Lower-Tier REMIC Subordinated Balance Ratio is
maintained); and
second, any remaining principal and Realized Losses to the
Lower-Tier REMIC
Regular Interests ending with the designation "B" in such a manner
that the
remaining principal balance of each such Lower-Tier REMIC Regular
Interest
equals the excess of (x) the Group One Non-PO Allocated Amount (in
the case of
the Class LT1-B Interest) or the Group Two Non-PO Allocated Amount
(in the case
of the Class LT2-B Interest) over (y) the Uncertificated Principal
Balance of
the Lower-Tier REMIC Regular Interest ending with the designation
"A" which is
related to the same Mortgage Group. All computations with respect
to the
Lower-Tier REMIC Interests shall be taken out to eight decimal
places.
If on any Distribution Date there is an increase in the
principal
amount of any Class of Certificates (other than the Class A-P
Certificates)
related to Subsequent Recoveries, then, prior to distributions of
principal and
allocations of losses on such Distribution Date with respect to the
Lower-Tier
REMIC, there shall be a corresponding increase in the
Uncertificated Principal
Balance of the Lower-Tier REMIC Regular Interests, with such
increase allocated
among the Lower-Tier REMIC Regular Interests first, to each
Lower-Tier REMIC
Regular Interest ending with the designation "A", so that the
Uncertificated
Principal Balance of each such Lower-Tier REMIC Regular Interest
continues to
equal the same percentage of the excess of (x) the Group One Non-PO
Allocated
Amount (in the case of the Class LT1-A Interest) or the Group Two
Non-PO
Allocated Amount (in the case of the Class LT2-A Interest) over (y)
the
aggregate class principal amounts of the Class 1-A Certificates (in
the case of
the Class LT1-A Interest) or the Class 2-A Certificates (in the
case of the
Class LT2-A Interest) and so that the Lower-Tier REMIC Subordinated
Balance
Ratio is maintained; and second, any remaining increase allocated
to the
Lower-Tier REMIC Regular Interests ending with the designation "B"
in such a
manner that the principal balance of each such Lower-Tier REMIC
Regular Interest
equals the excess of (x) the Group One Non-PO Allocated Amount (in
the case of
the Class LT1-B Interest) or the Group Two Non-PO Allocated Amount
(in the case
of the Class LT2-B Interest) over (y) the Uncertificated Principal
Balance of
the Lower-Tier REMIC Regular Interest ending with the designation
"A" which is
related to the same Mortgage Group.
52
<PAGE>
MIDDLE TIER REMIC
The following table specifies the class designation, interest
rate,
initial principal amount and Classes of corresponding certificates
for each
class of Middle-Tier REMIC Interest:
53
<PAGE>
Pass-
Middle-Tier REMIC
Through
Corresponding
Interest
Initial Balance Rate
Certificates
------------------- -------------- -------- -----------------------
MT-R
(1)
(1)
N/A
MT1-A1
(2)
6.25%
Class 1-A1
MT1-A2
(2)
6.25%
Class 1-A2
MT1-A3
(2)
6.00%
Class 1-A3
MT1-A4
(2)
6.50%
Class 1-A4
MT1-A5
(2)
6.25%
Class 1-A5
MT1-A6
(2)
6.25%
Class 1-A6
MT1-A7
(2)
6.25%
Class 1-A7
MT1-A8
(2)
6.25%
Class 1-A8
MT1-A9
(2)
6.25%
Class 1-A9
MT1-A10
(2)
6.25%
Class 1-A10
MT1-A11
(2)
6.25%
Class 1-A11
MT1-A12
(2)
6.25%
Class 1-A12
MT1-A13
(2)
6.25%
Class 1-A13
MT1-A14
(2)
6.25%
Class 1-A14
MT1-A15
(2)
6.25%
Class 1-A15
MT1-A16
(2)
6.25%
Class 1-A16
MT1-A17
(2)
6.25%
Class 1-A17
MT1-A18
(2)
6.25%
Class 1-A18
MT1-A19
(2)
6.25%
Class 1-A19
MT1-AX
(3)
6.25%
Class 1-AX
MTA-P Component One $932,875.43
0.00%
Class A-P Component One
MTA-R
(2)
6.25%
Class A-R
MT2-A1
(2)
6.00%
Class 2-A1
MT2-A2
(2)
6.00% Class 2-A2,
Class 2-A3
MT2-A4
(2)
6.00%
Class
2-A4
MT2-A5
(2)
6.00%
Class 2-A5
MT2-A6
(2)
6.00%
Class 2-A6
MT2-A7
(2)
6.00%
Class 2-A7
MT2-A8
(2)
6.00%
Class 2-A8
MT2-A9
(2)
6.00%
Class 2-A9
MT2-AX
(4)
6.00%
Class 2-AX
MTA-P Component Two $315,848.81
0.00%
Class A-P Component Two
MTA-M
(2)
(5)
Class A-M
MTM-1
(2)
(5)
Class M-1
MTB-1
(2)
(5)
Class B-1
MTB-2
(2)
(5)
Class B-2
MTB-3
(2)
(5)
Class B-3
MTB-4
(2)
(5)
Class B-4
MTB-5
(2)
(5)
Class B-5
----------
(1) The Class MT-R
Interest shall represent the sole class of residual interest
in
the Middle-Tier REMIC. The Class MT-R Interest will not have a
principal
amount or an interest rate. The Class MT-R Interest shall be
represented by
the
Class A-R Certificate.
54
<PAGE>
MT-R
Interest shall be represented by the Class A-R Certificate.
(2) The initial
principal amount of each of these interests shall be equal to
the
Original Certificate Principal Balance the Class of
corresponding
Certificates (disregarding the notional amount of any class of
"interest-only" certificates).
(3) The Class MT1-AX
Interest is an interest only interest, has no principal
balance, is not entitled to payments of principal and will bear
interest on
its
notional amount. The notional amount of the Class MT1-AX Interest
shall
equal the Class 1-AX Notional Amount.
(4) The Class MT2-AX
Interest is an interest only interest, has no principal
balance, is not entitled to payments of principal and will bear
interest on
its
notional amount. The notional amount of the Class MT2-AX Interest
shall
equal the Class 2-AX Notional Amount.
(5) For any
Distribution Date, the interest rate for the Class MTA-M
Interest,
Class MTM-1 Interest, Class MTB-1 Interest, Class MTB-2 Interest,
Class
MTB-3 Interest, Class MTB-4 Interest and Class MTB-5 Interest shall
be a
per
annum rate equal to the weighted average of the interest rates on
the
Class LT1-A Interest and the Class LT2-A Interest weighted on the
basis of
their principal amounts immediately prior to such Distribution
Date.
Principal and interest (disregarding payments in respect of Basis
Risk Shortfall
Carryover Amounts) shall be payable to, and shortfalls, losses,
prepayments and
increases in principal amount are allocable to, the Middle-Tier
REMIC Regular
Interests as such amounts are payable and allocable to the
corresponding
certificates under this Agreement (excluding Section 6.01(I)(a)(v)
hereof).
(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;
55
<PAGE>
(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);
(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.
(f) It is intended that the rights of each Class of the Class
1-A10
and Class 2-A8 Certificates to receive payments in respect of Basis
Risk
Shortfall Carryover Amounts shall be treated as a right in interest
rate cap
contracts and such shall be accounted for as property held separate
and apart
from the regular interests in the Upper-Tier REMIC held by the
Holders of the
Class 1-A10 and Class 2-A8 Certificates. This provision is intended
to satisfy
the requirements of Treasury Regulations Section 1.860G-2(i) for
the treatment
of property rights coupled with REMIC interests to be separately
respected and
shall be interpreted consistently with such regulation.
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
56
<PAGE>
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 or before the Closing
Date it has
entered into the Sale Agreements with the Sellers, that the Sellers
have made
the following representations and warranties with respect to each
Mortgage Loan
in the Relevant 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 Relevant 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 Relevant
Sale Agreement.
(a) The information set forth in the Mortgage Loan Schedule is
complete, true and correct in all material respects;
(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
Relevant Seller's knowledge, there are no material defaults under
the terms of
the Mortgage Loan; the Relevant 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;
57
<PAGE>
(d) To the best of the Relevant 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 Relevant 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;
(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
58
<PAGE>
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 Relevant 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 Relevant 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
Relevant 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 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 Relevant
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 Relevant 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
59
<PAGE>
insurance policy, and no prior holder of the related Mortgage,
including the
Relevant 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 Relevant 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 Relevant 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;
(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
Relevant
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;
60
<PAGE>
(u) The Mortgage File contains an appraisal or a
recertification
document (in the case of a Mortgage Loan originated under CHF'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 Relevant 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
Relevant 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. No
Mortgage Loan
contains terms or provisions which would result in negative
amortization;
(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
61
<PAGE>
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 Relevant 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;
(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 the Relevant Seller's eligibility
requirements, as
set forth in the Relevant 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 the Relevant Seller's underwriting guidelines as
of such date;
(ii) To the best of the Relevant 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 Relevant 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
62
<PAGE>
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 Section 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 Relevant 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;
(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
63
<PAGE>
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 Relevant Seller, which notice shall specify the date of
discovery.
Pursuant to the Relevant Sale Agreement, the Relevant Seller shall
within 90
days from the earlier of (i) the date of receipt of notice of such
breach or
(ii) the date the Relevant 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 Relevant 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 Relevant 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 Relevant 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.
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 limited liability company duly chartered
and
validly existing in good standing under the laws of the State of
Delaware, 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 certificate of formation 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
64
<PAGE>
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 either of the Sellers is
required to repurchase any Mortgage Loan pursuant to Section 2.02
or 3.01, that
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 Relevant 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 Relevant 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.
The Relevant 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 Servicer and the
Trustee. The Sale
Agreements provide that upon such amendment the Relevant 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 Custodian on behalf of 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
65
<PAGE>
Prepayments made thereon during such month shall be the property of
the Relevant
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 September 26, 2006 (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 Paying Agent
and 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 Paying Agent and 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.
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
66
<PAGE>
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 1-AX, Class 2-A3 and 2-AX
Certificates,
in the minimum denominations based upon the Class 1-AX Notional
Amount, Class
2-A3 Notional Amount and the Class 2-AX Notional Amount,
respectively) 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 1-A1............ $100,000.00
$113,847,000.00
16163B AA 2
Class 1-A2............ $100,000.00
$ 2,382,770.00
16163B AB 0
Class 1-A3............ $ 1,000.00
$ 3,563,000.00
16163B AC 8
Class 1-A4............ $ 1,000.00
$ 3,563,000.00
16163B AD 6
Class 1-A5............ $ 1,000.00
$ 4,175,000.00
16163B AE 4
Class 1-A6............ $ 1,000.00
$ 6,537,000.00
16163B AF 1
Class 1-A7............ $ 1,000.00
$
482,000.00
16163B AG 9
Class 1-A8............ $ 1,000.00
$ 1,680,000.00
16163B AH 7
Class 1-A9............ $100,000.00
$ 64,000,000.00
16163B AJ 3
Class 1-A10........... $100,000.00
$ 53,540,000.00
16163B AK 0
Class 1-A11........... $100,000.00
$ 31,276,000.00
16163B AL 8
Class 1-A12.......... $100,000.00
$ 26,474,000.00
16163B AM 6
Class 1-A13........... $100,000.00
$
410,000.00
16163B AN 4
Class 1-A14........... $100,000.00
$ 29,500,000.00
16163B AP 9
Class 1-A15........... $100,000.00
$
617,407.00
16163B AQ 7
Class 1-A16........... $100,000.00
$ 20,500,000.00
16163B AR 5
Class 1-A17........... $100,000.00
$ 50,000,000.00
16163B AS 3
Class 1-A18........... $100,000.00
$ 92,639,000.00
16163B AT 1
Class 1-A19........... $100,000.00
$ 2,315,577.00
16163B AU 8
Class 1-AX............ $100,000.00
(1)
16163B AV 6
Class 2-A1............ $100,000.00
$ 98,500,000.00
16163B AW 4
Class 2-A2............ $100,000.00
65,000,000.00
16163B AX 2
Class 2-A3............ $100,000.00
(1)
16163B AY 0
Class 2-A4............ $ 1,000.00
$ 10,745,393.00
16163B AZ 7
Class 2-A5............ $100,000.00
$ 86,054,000.00
16163B BA 1
Class 2-A6............ $100,000.00
$ 65,508,000.00 16163B BB
9
Class 2-A7............ $100,000.00
$ 33,053,000.00
16163B BC 7
Class 2-A8............ $100,000.00
$101,372,000.00
16163B BD 5
</TABLE>
67
<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 2-A9............ $100,000.00
$11,778,787.00
16163B BE 3
Class 2-AX............ $100,000.00
(1)
16163B BF 0
Class A-R(2).......... $ 100.00
$
100.00
16163B BH 6
Class A-P(3).......... $100,000.00
$ 1,248,724.00
16163B BG 8
Class A-M............. $100,000.00
$11,267,200.00
16163B BN 3
Class M-1............. $100,000.00
$18,437,300.00
16163B BK 9
Class B-1............. $100,000.00
$ 5,633,600.00
16163B BP 8
Class B-2............. $100,000.00
$ 3,072,900.00
16163B BQ 6
Class B-3............. $100,000.00
$ 2,048,600.00
16163B BR 4
Class B-4............. $100,000.00
$ 1,536,400.00
16163B BS 2
Class B-5............. $100,000.00
$ 1,536,507.87
16163B BT 0
</TABLE>
-------------
(1) The Class 1-AX,
Class 2-A3 and Class 2-AX Certificates are interest-only
certificates, have no principal balance and will bear interest on
their
notional amounts. The initial notional amounts of the Class 1-AX,
Class
2-A3
and Class 2-AX Certificates are $27,458,235.19, $2,708,333.33
and
$35,644,909.86, respectively.
(2) The Class A-R
Certificate represents the residual interest in each of the
REMIC Pools.
(3) The Class A-P
Certificates consist of two components. The original
principal amount of Class A-P Component One is $932,875.43 and the
original
principal amount of Class A-P Component Two is $315,848.81.
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 (the
"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
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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.
(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. 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 reasonably satisfactory to the Depositor
and the
Trustee 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 made unless the prospective transferee
provides the
Depositor and the Trustee with (I) a representation as set forth in
Exhibit K
for Class A-R Certificates or in Exhibit M for ERISA Restricted
Certificates 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"), and
is not
directly or indirectly acquiring the Certificate for, on behalf of
or with any
assets of any such Plan, or (II) solely in the case of an ERISA
Restricted
Certificate, (A) if the Certificate has been the subject of an
ERISA-Qualifying
Underwriting, a representation as set forth in Exhibit M that 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 (B) solely in the case of a Definitive
Certificate,
an Opinion of Counsel reasonably satisfactory to the Depositor and
the Trustee
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 paragraph (i) of this Subsection
4.02(d), other
than subparagraph (i)(II)(B), shall be deemed to have been made to
the Depositor
and the Trustee 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
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 reasonably
satisfactory to the
Depositor and the Trustee 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 or Class A-R Certificate
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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 and
the Trustee
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, the Certificate
Registrar and 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 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
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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.
Section
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
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
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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.
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.
Section 4.05 Appointment of Paying Agent and Certificate
Registrar;
Certificate Account. The Trustee shall appoint a Paying Agent and a
Certificate
Registrar (the "Certificate Registrar") hereunder, provided such
Paying Agent
and such Certificate Registrar shall not be the Depositor, any
Seller, or an
Affiliate of the Depositor or any Seller unless such Paying Agent
or such
Certificate Registrar is the World Securities Services Department
of Chase. 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")
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which shall be an Eligible Account in the name of "The Bank of New
York, as
Trustee, in trust for and for the benefit of the Certificateholders
of
Multi-Class Mortgage Pass-Through Certificates, Chase Mortgage
Finance
Corporation, Series 2006-S2 - 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 Distribution 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. So long as 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 World Securities Services 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.
Notwithstanding anything to the contrary contained herein, no
approvals or
consent shall be required for the subsequent appointment of The
Bank of New York
as Paying Agent.
The Paying Agent will hold all sums held by it for the payment
to
Certificateholders in trust for the benefit of the
Certificateholders entitled
thereto until such sums shall be paid to such
Certificateholders.
Section 4.06 Authenticating Agents.
(a) The Trustee may appoint one or more Authenticating Agents
(each,
an "Authenticating Agent") which shall be authorized to act on
behalf of the
Trustee in authenticating the Certificates. Wherever reference is
made in this
Agreement to the authentication of Certificates by the Trustee or
the Trustee's
certificate of authentication, such reference shall be deemed to
include
authentication on behalf of the Trustee by an Authenticating Agent
and a
certificate of authentication executed on behalf of the Trustee by
an
Authenticating Agent. Each Authenticating Agent must be an entity
organized and
doing business under the laws of the United States of America or of
any state,
having a combined capital and surplus of at least $15,000,000,
authorized under
such laws to do a trust business and subject to supervision or
examination by
federal or state authorities. So long as the Authenticating 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 Authenticating
Agent. The
Trustee hereby appoints the Paying Agent as the initial
Authenticating Agent.
(b) Any Person into which any Authenticating Agent may be merged
or
converted or with which it may be consolidated, or any Person
resulting from any
merger, conversion or consolidation to which any Authenticating
Agent shall be a
party, or any Person succeeding to the corporate agency business of
any
Authenticating Agent, shall continue to be the Authenticating Agent
without the
execution or filing of any paper or any further act on the part of
the Trustee
or the Authenticating Agent.
(c) Any Authenticating Agent may at any time resign by giving at
least
30 days' advance written notice of resignation to the Trustee and
the Depositor.
The Trustee may at any time terminate the agency of any
Authenticating Agent by
giving written notice of termination to such Authenticating Agent
and the
Depositor. Upon receiving a notice of resignation or upon such a
termination, or
in case at any
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time any Authenticating Agent shall cease to be eligible in
accordance within
the provisions of this Section 4.06, the Trustee may appoint a
successor
Authenticating Agent, shall give written notice of such appointment
to the
Depositor and shall mail notice of such appointment to all Holders
of
Certificates. Any successor Authenticating Agent upon acceptance of
its
appointment hereunder shall become vested with all the rights,
powers, duties
and responsibilities of its predecessor hereunder, with like effect
as if
originally named as Authenticating Agent. No successor
Authenticating Agent
shall be appointed unless eligible under the provisions of this
Section 4.06. No
Authenticating Agent shall have responsibility or liability for any
action taken
by it as such at the direction of the Trustee. Each of the
Authenticating Agent,
Certificate Registrar and Paying Agent shall be afforded the same
rights,
protections and indemnities as the Trustee as set forth under
Article VIII
hereunder.
[END OF ARTICLE IV]
ARTICLE V
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 5.01 Servicer to Service Mortgage Loans. The Servicer
shall
service and administer the Mortgage Loans and shall have full power
and
authority, acting alone or through Sub-Servicers as provided in
Section 5.02, to
do any and all things which it may deem necessary or desirable in
connection
with such servicing and administration, all in accordance with
Accepted
Servicing Practices. Without limiting the generality of the
foregoing, the
Servicer in its own name or in the name of a Sub-Servicer shall,
pursuant to a
power of attorney granted hereby by the Trustee for such purposes,
when the
Servicer or the Sub-Servicer, as the case may be, believes it
appropriate in its
best judgment, to execute and deliver, on behalf of the
Certificateholders and
the Trustee or any of them, any and all instruments of satisfaction
or
cancellation, or of partial or full release or discharge and all
other
comparable instruments, with respect to the Mortgage Loans and with
respect to
the related Mortgaged Properties; provided, however, that subject
to the
provisions of this paragraph, the Servicer may allow a modification
with respect
to a Mortgage Loan if the Servicer would tak
