EXHIBIT 99.1
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The Pooling and Servicing Agreement
EXECUTION COPY
====================
CWALT, INC.,
Depositor
COUNTRYWIDE HOME LOANS, INC.,
Seller
PARK GRANADA LLC,
Seller
PARK MONACO INC.,
Seller
PARK SIENNA LLC,
Seller
COUNTRYWIDE HOME LOANS SERVICING LP,
Master Servicer
and
THE BANK OF NEW YORK,
Trustee
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POOLING AND SERVICING AGREEMENT
Dated as of January 1, 2006
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ALTERNATIVE LOAN TRUST 2006-OC1
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2006-OC1
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TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS.......................................................12
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES.....49
SECTION 2.01. Conveyance of Mortgage Loans...........................49
SECTION 2.02. Acceptance by Trustee of the Mortgage Loans............53
SECTION 2.03. Representations, Warranties and Covenants of the
Sellers and Master Servicer............................55
SECTION 2.04. Representations and Warranties of the Depositor
as to the Mortgage Loans...............................57
SECTION 2.05. Delivery of Opinion of Counsel in Connection with
Substitutions..........................................58
SECTION 2.06. Execution and Delivery of Certificates.................58
SECTION 2.07. REMIC Matters..........................................59
SECTION 2.08. Covenants of the Master Servicer.......................59
ARTICLE III ADMINISTRATION AND SERVICING OF MORTGAGE LOANS..................60
SECTION 3.01. Master Servicer to Service Mortgage Loans..............60
SECTION 3.02. Subservicing; Enforcement of the Obligations
of Subservicers........................................61
SECTION 3.03. Rights of the Depositor, the NIM Insurer and the
Trustee in Respect of the Master Servicer..............61
SECTION 3.04. Trustee to Act as Master Servicer......................62
SECTION 3.05. Collection of Mortgage Loan Payments; Certificate
Account; Distribution Account; Carryover Reserve
Fund; Principal Reserve Fund...........................62
SECTION 3.06. Collection of Taxes, Assessments and Similar Items;
Escrow Accounts........................................66
SECTION 3.07. Access to Certain Documentation and Information
Regarding the Mortgage Loans...........................66
SECTION 3.08. Permitted Withdrawals from the Certificate Account,
the Distribution Account, the Carryover Reserve
Fund and the Principal Reserve Fund....................67
SECTION 3.09. Maintenance of Hazard Insurance; Maintenance of
Primary Insurance Policies.............................69
SECTION 3.10. Enforcement of Due-on-Sale Clauses; Assumption
Agreements.............................................70
SECTION 3.11. Realization Upon Defaulted Mortgage Loans; Repurchase
of Certain Mortgage Loans..............................71
SECTION 3.12. Trustee to Cooperate; Release of Mortgage Files........75
SECTION 3.13. Documents, Records and Funds in Possession of
Master Servicer to be Held for the Trustee.............76
SECTION 3.14. Servicing Compensation.................................76
SECTION 3.15. Access to Certain Documentation........................77
i
SECTION 3.16. Annual Statement as to Compliance......................77
SECTION 3.17. Errors and Omissions Insurance; Fidelity Bonds.........77
SECTION 3.18. Notification of Adjustments............................78
SECTION 3.19. The Swap Contract......................................78
SECTION 3.20. Prepayment Charges.....................................80
ARTICLE IV DISTRIBUTIONS AND ADVANCES BY THE MASTER SERVICER................81
SECTION 4.01. Advances...............................................81
SECTION 4.02. Priorities of Distribution.............................82
SECTION 4.03. [Reserved].............................................88
SECTION 4.04. [Reserved].............................................88
SECTION 4.05. [Reserved].............................................88
SECTION 4.06. Monthly Statements to Certificateholders...............88
SECTION 4.07. Determination of Pass-Through Rates for COFI
Certificates...........................................89
SECTION 4.08. Determination of Pass-Through Rates for LIBOR
Certificates...........................................90
SECTION 4.09. Swap Trust and Swap Account............................91
ARTICLE V THE CERTIFICATES..................................................93
SECTION 5.01. The Certificates.......................................93
SECTION 5.02. Certificate Register; Registration of Transfer
and Exchange of Certificates...........................94
SECTION 5.03. Mutilated, Destroyed, Lost or Stolen Certificates......99
SECTION 5.04. Persons Deemed Owners..................................99
SECTION 5.05. Access to List of Certificateholders' Names and
Addresses..............................................99
SECTION 5.06. Maintenance of Office or Agency.......................100
ARTICLE VI THE DEPOSITOR AND THE MASTER SERVICER...........................101
SECTION 6.01. Respective Liabilities of the Depositor and
the Master Servicer...................................101
SECTION 6.02. Merger or Consolidation of the Depositor or
the Master Servicer...................................101
SECTION 6.03. Limitation on Liability of the Depositor, the
Sellers, the Master Servicer, the NIM Insurer
and Others............................................101
SECTION 6.04. Limitation on Resignation of Master Servicer..........102
ARTICLE VII DEFAULT........................................................103
SECTION 7.01. Events of Default.....................................103
SECTION 7.02. Trustee to Act; Appointment of Successor..............105
SECTION 7.03. Notification to Certificateholders....................106
ARTICLE VIII CONCERNING THE TRUSTEE........................................107
SECTION 8.01. Duties of Trustee.....................................107
SECTION 8.02. Certain Matters Affecting the Trustee.................108
SECTION 8.03. Trustee Not Liable for Certificates or Mortgage
Loans.................................................109
SECTION 8.04. Trustee May Own Certificates..........................109
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SECTION 8.05. Trustee's Fees and Expenses...........................109
SECTION 8.06. Eligibility Requirements for Trustee..................110
SECTION 8.07. Resignation and Removal of Trustee....................110
SECTION 8.08. Successor Trustee.....................................111
SECTION 8.09. Merger or Consolidation of Trustee....................112
SECTION 8.10. Appointment of Co-Trustee or Separate Trustee.........112
SECTION 8.11. Tax Matters...........................................114
ARTICLE IX TERMINATION.....................................................117
SECTION 9.01. Termination upon Liquidation or Purchase of all
Mortgage Loans........................................117
SECTION 9.02. Final Distribution on the Certificates................117
SECTION 9.03. Additional Termination Requirements...................119
ARTICLE X MISCELLANEOUS PROVISIONS.........................................120
SECTION 10.01. Amendment.............................................120
SECTION 10.02. Recordation of Agreement; Counterparts................121
SECTION 10.03. Governing Law.........................................122
SECTION 10.04. Intention of Parties..................................122
SECTION 10.05. Notices...............................................123
SECTION 10.06. Severability of Provisions............................125
SECTION 10.07. Assignment............................................125
SECTION 10.08. Limitation on Rights of Certificateholders............125
SECTION 10.09. Inspection and Audit Rights...........................126
SECTION 10.10. Certificates Nonassessable and Fully Paid.............126
SECTION 10.11. [Reserved]............................................126
SECTION 10.12. Protection of Assets..................................126
SECTION 10.13. Rights of NIM Insurer.................................126
ARTICLE XI EXCHANGE ACT REPORTING..........................................127
SECTION 11.01. Filing Obligations....................................127
SECTION 11.02. Form 10-D Filings.....................................128
SECTION 11.03. Form 8-K Filings......................................129
SECTION 11.04. Form 10-K Filings.....................................129
SECTION 11.05. Xxxxxxxx-Xxxxx Certification..........................130
SECTION 11.06. Form 15 Filing........................................130
SECTION 11.07. Report on Assessment of Compliance and Attestation....130
SECTION 11.08. Use of Subservicers and Subcontractors................132
SECTION 11.09. Amendments............................................133
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SCHEDULES
Schedule I: Mortgage Loan Schedule..................................S-I-1
Schedule II-A: Representations and Warranties of Countrywide........S-II-A-1
Schedule II-B: Representations and Warranties of Park Granada.......S-II-B-1
Schedule II-C: Representations and Warranties of Park Monaco........S-II-C-1
Schedule III-A: Representations and Warranties of Countrywide
as to all of the Mortgage Loans.....................S-III-A-1
Schedule III-B: Representations and Warranties of Countrywide
as to the Countrywide Mortgage Loans................S-III-B-1
Schedule III-C: Representations and Warranties of Park Granada
as to the Park Granada Mortgage Loans...............S-III-C-1
Schedule III-D: Representations and Warranties of Park Monaco
as to the Park Monaco Mortgage Loans................S-III-D-1
Schedule III-E: Representations and Warranties of Park Sienna
as to the Park Sienna Mortgage Loans................S-III-E-1
Schedule IV: Representations and Warranties of the Master
Servicer...............................................S-IV-1
Schedule V: Principal Balance Schedules [if applicable].............S-V-1
Schedule VI: Form of Monthly Master Servicer Report.................S-VI-1
Schedule VII: Prepayment Charge Schedule............................S-VII-1
EXHIBITS
Exhibit A: Form of Senior Certificate (excluding Notional
Amount Certificates)......................................A-1
Exhibit B: Form of Subordinated Certificate..........................B-1
Exhibit C-1: Form of Class A-R Certificate...........................C-1-1
Exhibit C-2: Form of Class P Certificate.............................C-2-1
Exhibit C-3 Form of Class C Certificate.............................C-3-1
Exhibit D: Form of Notional Amount Certificate.......................D-1
Exhibit E: Form of Reverse of Certificates...........................E-1
Exhibit F-1: Form of Initial Certification of Trustee................F-1-1
Exhibit F-2: [Reserved]..............................................F-2-1
Exhibit G-1: Form of Delay Delivery Certification of Trustee.........G-1-1
Exhibit G-2: [Reserved]..............................................G-2-1
Exhibit H-1: Form of Final Certification of Trustee..................H-1-1
Exhibit H-2: [Reserved]..............................................H-2-1
Exhibit I: Form of Transfer Affidavit................................I-1
Exhibit J-1: Form of Transferor Certificate (Residual................J-1-1
Exhibit J-2: Form of Transferor Certificate (Private)................J-2-1
Exhibit K: Form of Investment Letter [Non-Rule 144A].................K-1
Exhibit L: Form of Rule 144A Letter..................................L-1
Exhibit M: Form of Request for Release (for Trustee).................M-1
Exhibit N: Form of Request for Release of Documents (Mortgage
Loan - Paid in Full, Repurchased and Replaced)............N-1
Exhibit O: [Reserved]................................................O-1
Exhibit P: [Reserved]................................................P-1
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Exhibit Q: Standard & Poor's LEVELS(r) Version 5.6c Glossary Revised,
Appendix E................................................Q-1
Exhibit R: Form of Swap Contract.....................................R-1
Exhibit S-1: Form of Swap Contract Assignment Agreement..............S-1-1
Exhibit S-2: Form of Swap Contract Administration Agreement..........S-2-1
Exhibit T: Form of Officer's Certificate with respect to
Prepayments...............................................T-1
Exhibit U: Monthly Statement.........................................U-1
Exhibit V-1: Form of Performance Certification (Subservicer).........V-1-1
Exhibit V-2: Form of Performance Certification (Trustee).............V-2-1
Exhibit W: Form of Servicing Criteria to be Addressed in
Assessment of Compliance Statement........................W-1
Exhibit X: List of Item 1119 Parties.................................X-1
Exhibit Y: Form of Xxxxxxxx-Xxxxx Certification (Replacement
Master Servicer)..........................................Y-1
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THIS POOLING AND SERVICING AGREEMENT, dated as of January 1, 2006, among
CWALT, INC., a Delaware corporation, as depositor (the "Depositor"),
COUNTRYWIDE HOME LOANS, INC. ("Countrywide"), a New York corporation, as a
seller (a "Seller"), PARK GRANADA LLC ("Park Granada"), a Delaware limited
liability company, as a seller (a "Seller"), PARK MONACO INC. ("Park Monaco"),
a Delaware corporation, as a seller (a "Seller"), PARK SIENNA LLC ("Park
Sienna"), a Delaware limited liability company, as a seller (a "Seller"),
COUNTRYWIDE HOME LOANS SERVICING LP, a Texas limited partnership, as master
servicer (the "Master Servicer"), and THE BANK OF NEW YORK, a banking
corporation organized under the laws of the State of New York, as trustee (the
"Trustee").
WITNESSETH THAT
In consideration of the mutual agreements contained in this Agreement,
the parties to this Agreement agree as follows:
PRELIMINARY STATEMENT
The Depositor is the owner of the Trust Fund that is hereby conveyed to
the Trustee in return for the Certificates. For federal income tax purposes,
the Trust Fund (excluding the Carryover Reserve Fund), will consist of four
real estate mortgage investment conduits (each a "REMIC" or, in the
alternative, "REMIC 1," "REMIC 2," "REMIC 3" and the "Master REMIC,"
respectively). Each Certificate, other than the Class A-R Certificate, will
represent ownership of one or more regular interests in the Master REMIC for
purposes of the REMIC Provisions. The Class A-R Certificate represents
ownership of the sole class of residual interest in each of REMIC 1, REMIC 2,
REMIC 3 and the Master REMIC. The Master REMIC will hold as assets the several
classes of uncertificated REMIC 3 Interests (other than the R3-A-R Interest).
REMIC 3 will hold as assets the several classes of uncertificated REMIC 2
Interests (other than the R2-A-R Interest). REMIC 2 will hold as assets the
several classes of uncertificated REMIC 1 Interests (other than the R1-A-R
Interest). REMIC 1 will hold as assets all the property of the Trust Fund
(excluding the Carryover Reserve Fund). For federal income tax purposes, each
REMIC 1 Interest, REMIC 2 Interest and REMIC 3 Interest (except the R1-A-R
Interest, the R2-A-R Interest and the R3-A-R Interest) is hereby designated as
a regular interest in REMIC 1, REMIC 2 and REMIC 3, respectively. The latest
possible maturity date of all REMIC regular interests created hereby shall be
the Latest Possible Maturity Date.
1
REMIC 1:
The REMIC 1 Interests will have the initial balances, pass-through rates
and corresponding Class of Certificates as set forth in the following table:
Initial Principal Corresponding Loan
The REMIC 1 Interests Balance Pass-Through Rate roup
R1-A-1 (1) (2) 1
R1-B-1 (1) (2) 1
R1-C-1 (1) (2) 1
R1-A-2 (1) (2) 2
R1-B-2 (1) (2) 2
R1-C-2 (1) (2) 2
R1-P $100.00 (3) N/A
R1-A-R (4) (4) N/A
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(1) Each Class A REMIC 1 Interest will have an Initial Principal Balance equal
to 0.9% of the Subordinate Portion of its Corresponding Loan Group. Each
Class B REMIC 1 Interest will have an Initial Principal Balance equal to
0.1% of the Subordinate Portion of its Corresponding Loan Group. Each
Class C REMIC 1 Interest will have an Initial Principal Balance equal
to the excess of the initial aggregate Stated Principal Balance of the
Mortgage Loans in its Corresponding Loan Group over the initial aggregate
principal balances of the Class A and Class B REMIC 1 Interests
corresponding to such Loan Group.
(2) This REMIC 1 Interest will have an interest rate equal to the weighted
average of the Adjusted Net Mortgage Rates of the Mortgage Loans in the
Corresponding Loan Group.
(3) The Class R1-P Interest does not pay any interest. All Prepayment Charges
will be allocated to the Class R1-P Interest.
(4) The Class R1-A-R Interest is the sole class of residual interest in REMIC 1
It has no principal balance and pays no principal or interest.
On each Distribution Date, the Available Funds (including Prepayment
Charges) for each Loan Group shall be distributed with respect to its
corresponding REMIC 1 Interests in the following manner:
(1) Interest. Interest is to be distributed with respect to each REMIC 1
Interest at the rate, or according to the formulas, described above;
(2) Prepayment Charges. All Prepayment Charges will be allocated to the
Class R1-P Interest.
(3) Principal, if no Cross-Over Situation Exists. If no Cross-Over
Situation exists with respect to any Class of REMIC 1 Interests, pincipal
aounts arising with respect to each of Loan Group 1 and Loan Group 2 will be
allocated: first to cause the Loan Group's corresponding Class A and Class B
Interests to equal, respectively, 0.9% of the Subordinate Portion of such Loan
Group and 0.1% of the Subordinate Portion of such Loan Group; and second to
the Loan Group's corresponding Class C Interest;
2
(4) Principal, if a Cross-Over Situation Exists. If a Cross-Over
Situation exists with respect to the Class A and Class B Interests:
(a) If the Calculation Rate in respect of the outstanding Class A and
Class B Interests is less than the Subordinate Tax Net Rate Cap, then
Principal Relocation Payments will be made proportionately to the
outstanding Class A Interests prior to any other principal distributions
from each such Loan Group.
(b) If the Calculation Rate in respect of the outstanding Class A and
Class B Interests is greater than the Subordinate Tax Net Rate Cap, then
Principal Relocation Payments will be made to the outstanding Class B
Interests prior to any other principal distributions from each such Loan
Group.
In each case, Principal Relocation Payments will be made so as to cause
the Calculation Rate in respect of the outstanding Class A and Class B
Interests to equal the Subordinate Tax Net Rate Cap. With respect to each
Corresponding Loan Group, if (and to the extent that) the sum of (a) the
principal payments received during the Due Period and (b) the Realized Losses,
are insufficient to make the necessary reductions of principal on the Class A
and Class B Interests, then interest will be added to the Loan Group's Class C
Interest.
(c) Unless required to achieve the Calculation Rate, the outstanding
aggregate Class A and Class B Tracking Interests for all Loan Groups
will not be reduced below 1 percent of the excess of (i) the aggregate
outstanding Principal Balances of all Loan Groups as of the end of any
Due Period (reduced by principal prepayments received after the Due
Period that are to to be distributed on the Disribution Date related to
the Due Period) over (ii) the aggregate Class Certificate Balance of the
Senior Certificates for all Loan Groups as of the related Distribution
Date (after taking into account distributions of principal on such
Distribution Date).
If (and to the extent that) the limitation in paragraph (c) prevents the
distribution of principal to the corresponding Class A and Class B Interests
of a Loan Group, and if the Loan Group's Class C Interest has already been
reduced to zero, then the excess principal from that Loan Group will be paid
to the Class C Interests of the other Corresponding Loan Group, the aggregate
Class A and Class B Interests of which are less than 1% of the Subordinate
Portion of such Loan Groups. If the Loan Group corresponding to the Class C
Interest that receives such payment has a weighted average Adjusted Net
Mortgage Rate below the weighted average Adjusted Net Mortgage Rate of the
Loan Group making the payment, then the payment will be treated by REMIC 1 as
a Realized Loss. Conversely, if a Loan Group corresponding to the Class C
Interest that receives such payment has a weighted average Adjusted Net
Mortgage Rate above the weighted average Adjusted Net Mortgage Rate of the
Loan Group making the payment, then the payment will be treated by REMIC 1 as
a reimbursement for prior Realized Losses.
3
REMIC 2:
The following table specifies the Class designation, interest rate, and
principal amount for each Class of REMIC 2 Interests:
Initial Principal Interest Corresponding REMIC 3 Designated Termination
REMIC 2 Interest Balance Rate Interest Date (8)
R2-1-1 (1) (4) N/A N/A
R2-1-2 $37,826,463.63 (4) (7) February 2006
R2-1-3 $34,652,613.09 (4) (7) March 2006
R2-1-4 $31,744,961.09 (4) (7) April 2006
R2-1-5 $29,081,338.07 (4) (7) May 2006
R2-1-6 $26,641,188.03 (4) (7) June 2006
R2-1-7 $24,405,763.86 (4) (7) July 2006
R2-1-8 $22,357,524.67 (4) (7) August 2006
R2-1-9 $20,481,530.40 (4) (7) September 2006
R2-1-10 $18,762,931.75 (4) (7) October 2006
R2-1-11 $17,188,524.55 (4) (7) November 2006
R2-1-12 $15,746,212.28 (4) (7) December 2006
R2-1-13 $171,882,722.55 (4) (7) January 2007
R2-2-1 (2) (5) N/A N/A
R2-2-2 $63,058,881.24 (5) (7) February 2006
R2-2-3 $57,756,288.93 (5) (7) March 2006
R2-2-4 $52,899,476.82 (5) (7) April 2006
R2-2-5 $48,450,977.71 (5) (7) May 2006
R2-2-6 $44,376,472.74 (5) (7) June 2006
R2-2-7 $40,644,526.96 (5) (7) July 2006
R2-2-8 $37,226,347.00 (5) (7) August 2006
R2-2-9 $34,095,559.13 (5) (7) September 2006
R2-2-10 $31,227,811.40 (5) (7) October 2006
R2-2-11 $28,601,398.25 (5) (7) November 2006
R2-2-12 $26,195,391.11 (5) (7) December 2006
R2-2-13 $285,165,407.62 (5) (7) January 2007
R2-P $100.00 (6) R3-P N/A
R2-A-R (3) (3) N/A N/A
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(1) The Initial Principal Balance of the Class R2-1-1 REMIC Interest is equal
to the difference between (a) the aggregate Stated Principal Balance
of the Mortgage Loans in Loan Group 1 and the sum of the other Class
R2-1 REMIC Interests.
(2) The Initial Principal Balance of the Class R2-2-1 REMIC Interest is equal
to the difference between (a) the aggregate Stated Principal Balance of
the Mortgage Loans in Loan Group 2 and the sum of the other Class R2-2
REMIC Interests.
(3) The Class R2-A-R REMIC Interest is the sole class of residual interest
in the REMIC. It has no principal balance and pays no principal or
interest.
4
(4) A Rate equal to the Weighted Average Adjusted Net Mortgage Rate
of Loan Group 1. This Class of REMIC Interest corresponds to Loan Group 1.
(5) A Rate equal to the Weighted Average Adjusted Net Mortgage Rate of Loan
Group 2. This Class of REMIC Interest corresponds to Loan Group 2.
(6) The Class R2-P Interest does not pay any interest. All Prepayment Charges
allocated to the Class R1-P Interest will be allocated to the Class
R2-P Interest.
(7) For each Distribution Date occurring before the Designated Termination
Date, the Class A-I0 REMIC 3 Interest is entitled to a specified portion
of the interest payable on this REMIC Interest. Specifically, for each
Distribution Date, the Class A-I0 REMIC 3 Interest is entitled to interest
on this REMIC Interest at a rate equal to 1.10% per annum (the aggregate
of all such entitlements, the "A-IO Strip Amount").
(8) The Designated Termination Date for any R2 REMIC Interest is the day after
the Distribution Date for the listed month and year.
On each Distribution Date, the Available Funds from the REMIC 1
corresponding interest of each Loan Group shall be distributed with respect to
its corresponding REMIC 2 Interests in the following manner:
(1) Interest. Interest is to be distributed with respect to each REMIC
Interest at the rate, or according to the formulas, described above;
(2) Prepayment. All Prepayment Charges allocated to the Class R1-P
Interest will be allocated to the Class R2-P Interest.
(3) Principal. Principal Amounts arising with respect to each of Loan
Group 1 and Loan Group 2, will be allocated with respect to its corresponding
REMIC Interest having the lowest numeric value until its Principal Balance is
reduced to zero and thereafter shall be allocated to the next corresponding
REMIC Interest having the lowest numeric value.
REMIC 3:
The REMIC 3 Interests will have the initial balances, pass-through rates
and corresponding Class of Certificates as set forth in the following table:
Corresponding Class
The REMIC 3 Interests Initial Balance Pass-Through Rate of Certificates
R3-1-A-1 (1) (3) Class 1-A-1
R3-1-A-2 (1) (3) Class 1-A-2
R3-2-A-1 (1) (4) Class 2-A-1
R3-2-A-2 (1) (4) Class 2-A-2
R3-2-A-3A (1) (4) Class 2-A-3A
R3-2-A-3B (1) (4) Class 2-A-3B
R3-A-IO (2) (5) Class A-IO
R3-$100 $100 (6) Class A-R
R3-M-1 (1) (7) Class M-1
5
Corresponding Class
The REMIC 3 Interests Initial Balance Pass-Through Rate of Certificates
R3-M-2 (1) (7) Class M-2
R3-M-3 (1) (7) Class M-3
R3-M-4 (1) (7) Class M-4
R3-M-5 (1) (7) Class M-5
R3-M-6 (1) (7) Class M-6
R3-M-7 (1) (7) Class M-7
R3-M-8 (1) (7) Class M-8
R3-P $100 (6) Class P
R3-C (1) (7) Class C
R3-A-R (8) (8) N/A
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(1) On each Distribution Date, following the allocation of scheduled
principal, principal prepayments and Realized Losses, the Class R3-1-A-1
Interest, Class R3-1-A-2 Interest, Class R3-2-A-1 Interest, Class R3-2-A-1
Interest, Class R3-2-A-2 Interest, Class R3-2-A-3A, Class R3-2-A-3B, Class
R3-$100, Class R3-M-1 Interest, Class R3-M-2 Interest, Class R3-M-3
Interest, Class R3-M-4 Interest, Class R3-M-5 Interest, Class R3-M-6
Interest, Class R3-M-7 Interest and Class R3-M-8 Interest will each have
a principal balance that is equal to 100% of its corresponding Certificate
Class issued by the Master REMIC, and the Class R3-C Interest will have a
principal balance that is equal to the Overcollateralized Amount.
(2) The Class R3-A-IO Interest has no principle balance.
(3) The interest rate with respect to any Distribution Date (and the related
Interest Accrual Period) for this REMIC 3 Interest is a per annum rate
equal to the Weighted Average Adjusted Net Mortgage Rate of the Group 1
Mortgage Loans minus the weighted average of the interest payable on
the Group 1 REMIC 2 Interests having Designated Termination Dates with
each such interest capped at an interest rate of 0.00% after the Designated
Termination Date and each such interest capped at 1.10% before the
Designated Termination Date (the "Group 1 Tax Net Rate Cap").
(4) The interest rate with respect to any Distribution Date (and the related
Interest Accrual Period) for this REMIC 3 Interest is a per annum rate
equal to the Weighted Average Adjusted Net Mortgage Rate of the Group 2
Mortgage Loans minus the weighted average of the interest payable on the
Group 2 REMIC 2 Interests having Designated Termination Dates with each
such interest capped at an interest rate of 0.00% after the Designated
Termination Date and each such interest capped at 1.10% before the
Designated Termination Date (the "Group 2 Tax Net Rate Cap").
(5) The Class R3-A-IO Interest is entitled to the A-IO Strip Amount.
(6) The R3-$100 Interest and the Class R3-P Interest do not pay any interest.
All Prepayment Charges allocated to the Class R2-P Interest will be
allocated to the Class R3-P Interest.
6
(7) On each Distribution Date, the Subordinate Tax Net Rate Cap.
(8) The Class R3-A-R Interest is the sole class of residual interest in REMIC
3. It has no principal balance and pays no principal or interest.
On each Distribution Date, the Available Funds payable with respect to
the REMIC 2 Regular Interests (including Prepayment Charges) will be payable
with respect to the REMIC 3 Interests in the following manner:
(1) Interest. Interest is to be distributed with respect to each REMIC 3
Interest at the rate, or according to the formulas, described above.
(2) Prepayment Charges. All Prepayment Charges allocated to the Class
R2-P Interest will be allocated to the Class R3-P Interest.
(3) Principal. Principal shall be allocated among the REMIC 3 Interests
in the same manner that such items are allocated among their
corresponding Certificate Classes.
On each Distribution Date, Realized Losses (and increases in Principal
Balances attributable to Subsequent Recoveries) shall be allocated among the
REMIC 3 Interests in the same manner that Realized Losses (and increases in
Class Certificate Balances attributable to Subsequent Recoveries) are
allocated among each REMIC 3 Interest's Corresponding Class or Classes of
Certificates.
Master REMIC:
The Master REMIC Certificates will have the original certificate
principal balances and pass-through rates as set forth in the following table:
Original Class Certificate
Class Balance Pass-Through Rate
Class 1-A-1 $373,442,000.00 (1)
Class 1-A-2 $41,493,000.00 (1)
Class 2-A-1 $373,818,000.00 (1)
Class 2-A-2 $151,496,000.00 (1)
Class 2-A-3A $148,305,000.00 (1)
Class 2-A-3B $16,478,000.00 (1)
Class A-IO $1,200,470,312 (2) (1)
Class M-1 $20,407,000.00 (1)
Class M-2 $18,007,000.00 (1)
Class M-3 $11,404,000.00 (1)
Class M-4 $9,003,000.00 (1)
Class M-5 $9,603,000.00 (1)
Class M-6 $8,403,000.00 (1)
Class M-7 $8,403,000.00 (1)
Class M-8 $6,002,000.00 (1)
Class C (3) (4)
7
Original Class Certificate
Class Balance Pass-Through Rate
Class P $100.00 (5)
Class A-R $100.00 (6)
---------------
(1) The Certificates will accrue interest at the related Pass-Through Rates
identified in this Agreement. For federal income tax purposes, including
the computation of the Class C Distributable Amount, the Net Rate Cap for
the Class 1-A, Class 2-A and Subordinate Certificates shall be the Group 1
Tax Net Rate Cap, the Group 2 Tax Net Rate Cap and the Subordinate Tax Net
Rate Cap, respectively.
(2) The Class A-IO Certificates are interest only notional amount certificates.
(3) For federal income tax purposes, the Class C Certificates have an Original
Class Certificate Balance equal to the Overcollateralization Amount.
(4) For each Accrual Period the Class C Certificates are entitled to the
"Class C Distributable Amount," which shall consist of (i) a specified
portion of the interest on each of the REMIC 3 Regular Interests (excluding
the R3-P, R3-$100 and the R3 A-IO Interests) in an amount equal to the
excess of the pass-through rate in respect of the REMIC 3 Regular Interest
over the pass-through rate in respect of the Corresponding Class
Certificate of each such REMIC 3 Regular Interest, and (ii) all accruals
of interest and collections of scheduled principal and principal
prepayments allocated to the R3-C Interest.
(5) For each Distribution Date the Class P Certificates are entitled to all
Prepayment Charges distributed with respect to the Class R3-P
Interests.
(6) The Class A-R Certificates represent the sole class of residual interest
in each REMIC created hereunder. The Class A-R Certificates are not
entitled to distributions of interest.
It is not intended that the Class A-R Certificates be entitled to any
cash flows pursuant to this agreement except as provided in Section 3.08(d)
hereunder (that is, its entitlement to $100.00).
The foregoing REMIC structure is intended to cause all of the cash from
the Mortgage Loans to flow through to the Master REMIC as cash flow on a REMIC
regular interest, without creating any shortfall-actual or potential (other
than for credit losses)-to any REMIC regular interest. To the extent that the
structure is believed to diverge from such intention the Trustee will resolve
ambiguities to accomplish such result and will to the extent necessary rectify
any drafting errors or seek clarification to the structure without
Certificateholder approval (but with guidance of counsel selected by it with
due care and which has substantial experience with similar REMIC structures)
to accomplish such intention.
8
Set forth below are designations of Classes or Components of
Certificates and other defined terms to the categories used in this Agreement:
Accretion Directed
Certificates................ None.
Accretion Directed
Components.................. None.
Accrual Certificates........ None.
Accrual Components.......... None.
Book-Entry Certificates..... All Classes of Certificates other than the
Physical Certificates.
COFI Certificates........... None.
Component Certificates...... Class A-IO Certificates.
Components.................. For purposes of calculating distributions of
principal and/or interest, the Component
Certificates, if any, will be comprised of
multiple payment components having the
designations, Initial Component Balances or
Notional Amounts, as applicable, and Pass-
Through Rates set forth below:
Initial Component Pass-Through
Designation Principal Balance Rate
----------- ----------------- ------------
Class A-IO-1 $450,771,773 1.10%
Class A-IO-2 $749,698,538 1.10%
Delay Certificates.......... All interest-bearing Classes of Certificates
other than the Non-Delay Certificates, if any.
ERISA-Restricted
Certificates................ The Residual Certificates and the Private
Certificates; until they have been the subject
of an ERISA-Qualifying Underwriting, the Class
A-IO Certificates; and any Certificate of a
Class that does not or no longer satisfies the
applicable rating requirement under the
Underwriter's Exemption.
Group 1
Senior Certificates......... The Class 1-A-1 and Class 1-A-2 Certificates.
Group 2
Senior Certificates......... The Class 2-A-1, Class 2-A-2, Class 2-A-3A and
Class 2-A-3B Certificates.
9
Inverse Floating Rate
Certificates................ None.
LIBOR Certificates.......... The Class 1-A-1, Class 1-A-2, Class 2-A-1, Class
2-A-2, Class 2-A-3A, Class 2-A-3B, Class M-1,
Class M-2, Class M-3, Class M-4, Class M-5,
Class M-6, Class M-7 and Class M-8 Certificates.
Non-Delay Certificates...... The LIBOR Certificates.
Notional Amount
Certificates................ Class A-IO Certificates.
Offered Certificates........ All Classes of Certificates other than the
Private Certificates.
Physical Certificates....... The Private Certificates and the Residual
Certificates.
Planned Principal Classes... None.
Planned Principal
Components.................. None.
Principal Only Certificates. None.
Private Certificates........ The Class C and Class P Certificates.
Rating Agencies............. S&P and Xxxxx'x.
Regular Certificates........ All Classes of Certificates, other than the
Residual Certificates.
Residual Certificates....... The Class A-R Certificates.
Scheduled Principal
Classes..................... None.
Senior Certificates......... The Class 1-A-1, Class 1-A-2, Class 2-A-1,
Class 2-A-2, Class 2-A-3A and Class 2-A-3B
Certificates. Subordinated Certificates . The
Class M-1, Class M-2, Class M-3, Class M-4,
Class M-5, Class M-6, Class M-7 and Class M-8
Certificates.
Targeted Principal
Classes..................... None.
Underwriter................. Countrywide Securities Corporation.
10
With respect to any of the foregoing designations as to which the
corresponding reference is "None," all defined terms and provisions in this
Agreement relating solely to such designations shall be of no force or effect,
and any calculations in this Agreement incorporating references to such
designations shall be interpreted without reference to such designations and
amounts. Defined terms and provisions in this Agreement relating to
statistical rating agencies not designated above as Rating Agencies shall be
of no force or effect.
11
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and phrases, unless the
context otherwise requires, shall have the following meanings:
Accretion Directed Classes: As specified in the Preliminary Statement.
Additional Designated Information: As defined in Section 11.02.
Adjusted Mortgage Rate: As to each Mortgage Loan, and at any time, the
per annum rate equal to the Mortgage Rate less the Master Servicing Fee Rate.
Adjusted Net Mortgage Rate: As to each Mortgage Loan, and at any time,
the per annum rate equal to the Mortgage Rate less the related Expense Fee
Rate.
Adjustment Date: A date specified in each Mortgage Note as a date on
which the Mortgage Rate on the related Mortgage Loan will be adjusted.
Advance: As to each Loan Group, the payment required to be made by the
Master Servicer with respect to any Distribution Date pursuant to Section
4.01, the amount of any such payment being equal to the aggregate of payments
of principal and interest (net of the Master Servicing Fee) on the Mortgage
Loans in such Loan Group that were due on the related Due Date and not
received by the Master Servicer as of the close of business on the related
Determination Date, together with an amount equivalent to interest on each
Mortgage Loan as to which the related Mortgaged Property is an REO Property,
net of any net income from such REO Property, less the aggregate amount of any
such delinquent payments that the Master Servicer has determined would
constitute a Nonrecoverable Advance if advanced.
Agreement: This Pooling and Servicing Agreement and all amendments or
supplements this Pooling and Servicing Agreement.
Amount Held for Future Distribution: As to any Distribution Date and
each Loan Group, the aggregate amount held in the Certificate Account at the
close of business on the related Determination Date on account of (i)
Principal Prepayments received after the related Prepayment Period and
Liquidation Proceeds and Subsequent Recoveries received in the month of such
Distribution Date relating to such Loan Group and (ii) all Scheduled Payments
due after the related Due Date relating to such Loan Group.
Applied Realized Loss Amount: With respect to any Distribution Date and
the LIBOR Certificates, the sum of the Realized Losses with respect to the
Mortgage Loans which are to be applied in reduction of the Class Certificate
Balances of any such Class of Certificates pursuant to this Agreement, which,
in the case of the Subordinated Certificates, shall equal the amount, if any,
by which the aggregate Class Certificate Balance of all LIBOR Certificates
(after all distributions of principal on such Distribution Date) exceeds the
aggregate Stated Principal Balance of the Mortgage Loans as of the Due Date in
the month in which such Distribution Date occurs (after giving effect to
Principal Prepayments and Liquidation Proceeds allocated to principal and
Subsequent Recoveries received in the related Prepayment Period). With respect
to
12
each Class of Group 1 Senior Certificates and any Distribution Date on or
after which the aggregate Class Certificate Balance of the Subordinated
Certificates and Class C Certificates is equal to zero, the pro rata share
(based on the Class Certificate Balance of each such Class) of the amount, if
any, by which the aggregate Class Certificate Balance of the Group 1 Senior
Certificates (after all distributions of principal on such Distribution Date)
exceeds the aggregate Stated Principal Balance of the Group 1 Mortgage Loans
as of the Due Date in the month in which such Distribution Date occurs (after
giving effect to Principal Prepayments and Liquidation Proceeds allocated to
principal and Subsequent Recoveries received in the related Prepayment
Period). With respect to each Class of Group 2 Senior Certificates and any
Distribution Date on or after which the aggregate Class Certificate Balance of
the Subordinated Certificates and Class C Certificates is equal to zero, the
pro rata share (based on the Class Certificate Balance of each such Class) of
the amount, if any, by which the aggregate Class Certificate Balance of the
Group 2 Senior Certificates (after all distributions of principal on such
Distribution Date) exceeds the aggregate Stated Principal Balance of the Group
2 Mortgage Loans as of the Due Date in the month in which such Distribution
Date occurs (after giving effect to Principal Prepayments and Liquidation
Proceeds allocated to principal and Subsequent Recoveries received in the
related Prepayment Period).
Appraised Value: With respect to any Mortgage Loan, the Appraised Value
of the related Mortgaged Property shall be: (i) with respect to a Mortgage
Loan other than a Refinancing Mortgage Loan, the lesser of (a) the value of
the Mortgaged Property based upon the appraisal made at the time of the
origination of such Mortgage Loan and (b) the sales price of the Mortgaged
Property at the time of the origination of such Mortgage Loan; (ii) with
respect to a Refinancing Mortgage Loan other than a Streamlined Documentation
Mortgage Loan, the value of the Mortgaged Property based upon the appraisal
made-at the time of the origination of such Refinancing Mortgage Loan; and
(iii) with respect to a Streamlined Documentation Mortgage Loan, (a) if the
loan-to-value ratio with respect to the Original Mortgage Loan at the time of
the origination thereof was 80% or less and the loan amount of the new
mortgage loan is $650,000 or less, the value of the Mortgaged Property based
upon the appraisal made at the time of the origination of the Original
Mortgage Loan and (b) if the loan-to-value ratio with respect to the Original
Mortgage Loan at the time of the origination thereof was greater than 80% or
the loan amount of the new mortgage loan being originated is greater than
$650,000, the value of the Mortgaged Property based upon the appraisal (which
may be a drive-by appraisal) made at the time of the origination of such
Streamlined Documentation Mortgage Loan.
Available Funds: As to any Distribution Date and each Loan Group, the
sum of (a) the aggregate amount held in the Certificate Account at the close
of business on the related Determination Date, including any Subsequent
Recoveries, in respect of such Mortgage Loans net of the related Amount Held
for Future Distribution and net of Prepayment Charges and amounts permitted to
be withdrawn from the Certificate Account pursuant to clauses (i) - (viii) of
Section 3.08(a) in respect of such Mortgage Loans and amounts permitted to be
withdrawn from the Distribution Account pursuant to clauses (i) - (iii) of
Section 3.08(b) in respect of such Mortgage Loans, (b) the amount of the
related Advance and (c) in connection with Defective Mortgage Loans in such
Loan Group, as applicable, the aggregate of the Purchase Prices and
Substitution Adjustment Amounts deposited on the related Distribution Account
Deposit Date; provided, however, that after a Senior Termination Date,
Available Funds with respect to the Loan Group relating to the remaining
Senior Certificate Group shall include the Available Funds
13
from the other Loan Group after all distributions are made on the Senior
Certificates of the other related Senior Certificate Group and on any
Distribution Date thereafter, Available Funds shall be calculated based on all
the Mortgage Loans in the Mortgage Pool, as opposed to the Mortgage Loans in
the related Loan Group.
Bankruptcy Code: The United States Bankruptcy Reform Act of 1978, as
amended.
Book-Entry Certificates: As specified in the Preliminary Statement.
Business Day: Any day other than (i) a Saturday or a Sunday or (ii) a
day on which banking institutions in the City of New York, New York, or the
States of California or Texas or the city in which the Corporate Trust Office
of the Trustee is located are authorized or obligated by law or executive
order to be closed.
Calculation Rate: For each Distribution Date, the product of (i) 10 and
(ii) the weighted average rate of the outstanding Class A and Class B
Interests, treating each Class A Interest as having an interest rate of 0.00%
per annum.
Carryover Reserve Fund: The separate Eligible Account created and
initially maintained by the Trustee pursuant to Section 3.05(g) in the name of
the Trustee for the benefit of the Holders of the Offered Certificates and
designated "The Bank of New York in trust for registered holders of CWALT,
Inc., Alternative Loan Trust 2006-OC1, Mortgage Pass-Through Certificates,
Series 2006-OC1." Funds in the Carryover Reserve Fund shall be held in trust
for the Holders of the Offered Certificates for the uses and purposes set
forth in this Agreement.
Certificate: Any one of the Certificates executed by the Trustee in
substantially the forms attached this Agreement as exhibits.
Certificate Account: The separate Eligible Account or Accounts created
and maintained by the Master Servicer pursuant to Section 3.05 with a
depository institution in the name of the Master Servicer for the benefit of
the Trustee on behalf of Certificateholders and designated "Countrywide Home
Loans Servicing LP in trust for the registered holders of Alternative Loan
Trust 2006-OC1, Mortgage Pass-Through Certificates Series 2006-OC1."
Certificate Balance: With respect to any Certificate (other than the
Class C Certificates) at any date, the maximum dollar amount of principal to
which the Holder thereof is then entitled under this Agreement, such amount
being equal to the Denomination of that Certificate (A) plus, with respect to
the LIBOR Certificates, any increase to the Certificate Balance of such
Certificate pursuant to Section 4.02 due to the receipt of Subsequent
Recoveries and (B) minus the sum of (i) all distributions of principal
previously made with respect to that Certificate and (ii) with respect to the
LIBOR Certificates, any Applied Realized Loss Amounts allocated to such
Certificate on previous Distribution Dates pursuant to Section 4.02 without
duplication.
Certificate Owner: With respect to a Book-Entry Certificate, the Person
who is the beneficial owner of such Book-Entry Certificate. For the purposes
of this Agreement, in order for a Certificate Owner to enforce any of its
rights under this Agreement, it shall first have to provide evidence of its
beneficial ownership interest in a Certificate that is reasonably satisfactory
to the Trustee, the Depositor, and/or the Master Servicer, as applicable.
14
Certificate Register: The register maintained pursuant to Section 5.02.
Certificateholder or Holder: The person in whose name a Certificate is
registered in the Certificate Register, except that, solely for the purpose of
giving any consent pursuant to this Agreement, any Certificate registered in
the name of the Depositor or any affiliate of the Depositor shall be deemed
not to be Outstanding and the Percentage Interest evidenced thereby shall not
be taken into account in determining whether the requisite amount of
Percentage Interests necessary to effect such consent has been obtained;
provided, however, that if any such Person (including the Depositor) owns 100%
of the Percentage Interests evidenced by a Class of Certificates, such
Certificates shall be deemed to be Outstanding for purposes of any provision
of this Agreement (other than the second sentence of Section 10.01) that
requires the consent of the Holders of Certificates of a particular Class as a
condition to the taking of any action under this Agreement. The Trustee is
entitled to rely conclusively on a certification of the Depositor or any
affiliate of the Depositor in determining which Certificates are registered in
the name of an affiliate of the Depositor.
Certification Party: As defined in Section 11.05.
Certifying Person: As defined in Section 11.05.
Class: All Certificates bearing the same class designation as set forth
in the Preliminary Statement.
Class C Distributable Amount: As defined in the Preliminary Statement.
Class Certificate Balance: With respect to any Class of Certificates
other than the Class C Certificates and as to any date of determination, the
aggregate of the Certificate Balances of all Certificates of such Class as of
such date. With respect to the Class C Certificates and any Distribution Date,
the excess, if any, of the aggregate Stated Principal Balance of the Mortgage
Loans as of the Due Date in the prior calendar month (after giving effect to
Principal Prepayments, the principal portion of any Liquidation Proceeds and
any Subsequent Recoveries received in the Prepayment Period related to that
prior Due Date) over the aggregate Class Certificate Balance of the Offered
Certificates and the Class P Certificates immediately prior to that
Distribution Date.
Class P Certificate: Any Certificate designated as a "Class P
Certificate" on the face thereof, in the form of Exhibit C-3 hereto,
representing the right to distributions as set forth herein.
Class P Principal Distribution Date: The first Distribution Date that
occurs after the end of the latest Prepayment Charge Period for all Mortgage
Loans that have a Prepayment Charge.
Closing Date: January 30, 2006.
Code: The Internal Revenue Code of 1986, including any successor or
amendatory provisions.
COFI: The Monthly Weighted Average Cost of Funds Index for the Eleventh
District Savings Institutions published by the Federal Home Loan Bank of San
Francisco.
15
COFI Certificates: As specified in the Preliminary Statement.
Commission: The U.S. Securities and Exchange Commission.
Compensating Interest: As to any Distribution Date, an amount equal to
the product of 50% and the aggregate Master Servicing Fee payable to the
Master Servicer for that Distribution Date.
Component: As specified in the Preliminary Statement. Component Balance:
Not applicable.
Component Certificates: As specified in the Preliminary Statement.
Component Notional Amount: With respect to each Class A-IO Component and
Distribution Date, the lesser of (a) the amount in the table on Schedule VIII
attached hereto for such Component and Distribution Date and (b) (i) with
respect to the Class A-IO-1 Component, the aggregate Stated Principal Balance
of the Mortgage Loans in Loan Group 1 as of the Due Date in the month
preceding the month of that Distribution Date (after giving effect to
Principal Prepayments received in the related Prepayment Period) and (ii) with
respect to the Class A-IO-2 Component, the aggregate Stated Principal Balance
of the Mortgage Loans in Loan Group 2 as of the Due Date in the month
preceding the month of that Distribution Date (after giving effect to
Principal Prepayments received in the related Prepayment Period).
Coop Shares: Shares issued by a Cooperative Corporation.
Cooperative Corporation: The entity that holds title (fee or an
acceptable leasehold estate) to the real property and improvements
constituting the Cooperative Property and which governs the Cooperative
Property, which Cooperative Corporation must qualify as a Cooperative Housing
Corporation under Section 216 of the Code.
Cooperative Loan: Any Mortgage Loan secured by Coop Shares and a
Proprietary Lease.
Cooperative Property: The real property and improvements owned by the
Cooperative Corporation, including the allocation of individual dwelling units
to the holders of the Coop Shares of the Cooperative Corporation.
Cooperative Unit: A single family dwelling located in a Cooperative
Property.
Corporate Trust Office: The designated office of the Trustee in the
State of New York at which at any particular time its corporate trust business
with respect to this Agreement shall be administered, which office at the date
of the execution of this Agreement is located at 000 Xxxxxxx Xxxxxx, 0X, Xxx
Xxxx, Xxx Xxxx 00000 (Attn: Mortgage-Backed Securities Group, CWALT, Inc.
Series 2006-OC1, facsimile no. (000) 000-0000), and which is the address to
which notices to and correspondence with the Trustee should be directed.
Countrywide: Countrywide Home Loans, Inc., a New York corporation and
its successors and assigns, in its capacity as the seller of the Countrywide
Mortgage Loans to the Depositor.
16
Countrywide Mortgage Loans: The Mortgage Loans identified as such on the
Mortgage Loan Schedule for which Countrywide is the applicable Seller.
Countrywide Servicing: Countrywide Home Loans Servicing LP, a Texas
limited partnership and its successors and assigns.
Cross-Over Situation: For any Distribution Date and for each Loan Group
(after taking into account principal distributions on such Distribution Date),
a situation in which the Class A and Class B Interests corresponding to any
Loan Group are in the aggregate less than 1% of the Subordinate Component
Balance of the Loan Group to which they correspond.
Cumulative Loss Trigger Event: With respect to a Distribution Date on or
after the Stepdown Date, if the aggregate amount of Realized Losses on the
Mortgage Loans from (and including) the Cut-off Date to (and including) the
related Due Date (reduced by the aggregate amount of Subsequent Recoveries
received from the Cut-off Date through the Prepayment Period related to that
Due Date) exceeds the applicable percentage, for such Distribution Date, of
the Cut-off Date Pool Principal Balance as set forth below:
Distribution Date Percentage
February 2008 - January 2009................... 0.10% with respect to February 2008, plus an additional 1/12th of
0.40% for each month thereafter through January 2009
February 2009 - January 2010................... 0.50% with respect to February 2009, plus an additional 1/12th of
0.60% for each month thereafter through January 2010
February 2010 - January 2011................... 1.10% with respect to February 2010, plus an additional 1/12th of
0.60% for each month thereafter through January 2011
February 2011 - January 2012................... 1.70% with respect to February 2011, plus an additional 1/12th of
0.50% for each month thereafter through January 2012
February 2012 - January 2013................... 2.20% with respect to February 2012, plus an additional 1/12th of
0.40% for each month thereafter through January 2013
February 2013 and thereafter................... 2.60%
Current Interest: With respect to each Class of Offered Certificates and
each Distribution Date, the interest accrued at the applicable Pass-Through
Rate for the applicable Interest Accrual Period on the Class Certificate
Balance and Component Notional Amount of such Class immediately prior to such
Distribution Date.
17
Cut-off Date: As to any Mortgage Loan, the later of the date of
origination of that Mortgage Loan and January 1, 2006.
Cut-off Date Pool Principal Balance: $1,200,470,312.88.
Cut-off Date Principal Balance: As to any Mortgage Loan, the Stated
Principal Balance thereof as of the close of business on the Cut-off Date.
Debt Service Reduction: With respect to any Mortgage Loan, a reduction
by a court of competent jurisdiction in a proceeding under the Bankruptcy Code
in the Scheduled Payment for such Mortgage Loan that became final and
non-appealable, except such a reduction resulting from a Deficient Valuation
or any reduction that results in a permanent forgiveness of principal.
Defective Mortgage Loan: Any Mortgage Loan that is required to be
repurchased pursuant to Section 2.02 or 2.03. Deficient Valuation: With
respect to any Mortgage Loan, a valuation by a court of competent jurisdiction
of the Mortgaged Property in an amount less than the then-outstanding
indebtedness under the Mortgage Loan, or any reduction in the amount of
principal to be paid in connection with any Scheduled Payment that results in
a permanent forgiveness of principal, which valuation or reduction results
from an order of such court which is final and non-appealable in a proceeding
under the Bankruptcy Code.
Definitive Certificates: Any Certificate evidenced by a Physical
Certificate and any Certificate issued in lieu of a Book-Entry Certificate
pursuant to Section 5.02(e).
Delay Certificates: As specified in the Preliminary Statement.
Delay Delivery Certification: As defined in Section 2.02(a).
Delay Delivery Mortgage Loans: The Mortgage Loans for which all or a
portion of a related Mortgage File is not delivered to Trustee on the Closing
Date. With respect to up to 50% of the Mortgage Loans in each Loan Group, the
Depositor may deliver all or a portion of each related Mortgage File to the
Trustee not later than thirty days after the Closing Date. To the extent that
Countrywide Servicing shall be in possession of any Mortgage Files with
respect to any Delay Delivery Mortgage Loan, until delivery of such Mortgage
File to the Trustee as provided in Section 2.01, Countrywide Servicing shall
hold such files as Master Servicer hereunder, as agent and in trust for the
Trustee.
Deleted Mortgage Loan: As defined in Section 2.03(C).
Delinquency Trigger Event: With respect to a Distribution Date on or
after the Stepdown Date exists if the Rolling Sixty-Day Delinquency Rate
equals or exceeds the product of (x) the Senior Enhancement Percentage for
such Distribution Date and (y) the applicable percentage listed below for the
most senior class of outstanding LIBOR Certificates:
18
Class Percentage
Group 1 Senior Certificates and
--------------------------------------------------------------------
Group 2 Senior Certificates................ 43.60%
M-1........................................ 55.25%
M-2........................................ 72.75%
M-3........................................ 91.00%
M-4........................................ 113.50%
M-5........................................ 154.00%
M-6........................................ 223.50%
M-7........................................ 407.75%
M-8........................................ 990.25%
Delinquent: A Mortgage Loan is "delinquent" if any payment due thereon
is not made pursuant to the terms of such Mortgage Loan by the close of
business on the day such payment is scheduled to be due. A Mortgage Loan is
"30 days delinquent" if such payment has not been received by the close of
business on the corresponding day of the month immediately succeeding the
month in which such payment was due, or, if there is no such corresponding day
(e.g., as when a 30-day month follows a 31-day month in which a payment was
due on the 31st day of such month), then on the last day of such immediately
succeeding month. Similarly for "60 days delinquent," "90 days delinquent" and
so on.
Denomination: With respect to each Certificate, the amount set forth on
the face of that Certificate as the "Initial Certificate Balance of this
Certificate" or the "Initial Notional Amount of this Certificate" or, if
neither of the foregoing, the Percentage Interest appearing on the face
thereof.
Depositor: CWALT, Inc., a Delaware corporation, or its successor in
interest.
Depository: The initial Depository shall be The Depository Trust
Company, the nominee of which is CEDE & Co., as the registered Holder of the
Book-Entry Certificates. The Depository shall at all times be a "clearing
corporation" as defined in Section 8-102(a)(5) of the Uniform Commercial Code
of the State of New York.
Depository Participant: A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
Determination Date: As to any Distribution Date, the 22nd day of each
month or, if such 22nd day is not a Business Day, the next preceding Business
Day; provided, however, that if such 22nd day or such Business Day, whichever
is applicable, is less than two Business Days prior to the related
Distribution Date, the Determination Date shall be the first Business Day that
is two Business Days preceding such Distribution Date.
Distribution Account: The separate Eligible Account created and
maintained by the Trustee pursuant to Section 3.05(d) in the name of the
Trustee for the benefit of the Certificateholders and designated "The Bank of
New York in trust for registered holders of Alternative Loan Trust 2006-OC1,
Mortgage Pass-Through Certificates, Series 2006-OC1."
19
Funds in the Distribution Account shall be held in trust for the
Certificateholders for the uses and purposes set forth in this Agreement.
Distribution Account Deposit Date: As to any Distribution Date, 12:30
p.m. Pacific time on the Business Day immediately preceding such Distribution
Date.
Distribution Date: The 25th day of each calendar month after the initial
issuance of the Certificates, or if such 25th day is not a Business Day, the
next succeeding Business Day, commencing in February 2006.
Due Date: With respect to a Mortgage Loan, the date on which Scheduled
Payments are due on that Mortgage Loan. With respect to any Distribution Date,
the related Due Date is the first day of the calendar month in which that
Distribution Date occurs.
Due Period: Not applicable.
XXXXX: The Commission's Electronic Data Gathering, Analysis and
Retrieval system.
Eligible Account: Any of (i) an account or accounts maintained with a
federal or state chartered depository institution or trust company the
short-term unsecured debt obligations of which (or, in the case of a
depository institution or trust company that is the principal subsidiary of a
holding company, the debt obligations of such holding company) have the
highest short-term ratings of Moody's and one of the two highest short-term
ratings of S&P, if S&P is a Rating Agency at the time any amounts are held on
deposit therein, or (ii) an account or accounts in a depository institution or
trust company in which such accounts are insured by the FDIC (to the limits
established by the FDIC) and the uninsured deposits in which accounts are
otherwise secured such that, as evidenced by an Opinion of Counsel delivered
to the Trustee and to each Rating Agency, the Certificateholders have a claim
with respect to the funds in such account or a perfected first priority
security interest against any collateral (which shall be limited to Permitted
Investments) securing such funds that is superior to claims of any other
depositors or creditors of the depository institution or trust company in
which such account is maintained, or (iii) a trust account or accounts
maintained with (a) the trust department of a federal or state chartered
depository institution or (b) a trust company, acting in its fiduciary
capacity or (iv) any other account acceptable to each Rating Agency. Eligible
Accounts may bear interest, and may include, if otherwise qualified under this
definition, accounts maintained with the Trustee.
Eligible Repurchase Month: As defined in Section 3.11.
ERISA: The Employee Retirement Income Security Act of 1974, as amended.
ERISA-Qualifying Underwriting: A best efforts or firm commitment
underwriting or private placement that meets the requirements of the
Underwriter's Exemption.
ERISA-Restricted Certificate: As specified in the Preliminary Statement.
Escrow Account: The Eligible Account or Accounts established and
maintained pursuant to Section 3.06(a).
Event of Default: As defined in Section 7.01.
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Excess Cashflow: With respect to any Distribution Date the sum of (i)
the amount remaining as set forth in Section 4.02(a)(iii)(B) and (ii) the
amount remaining as set forth in Section 4.02(b)(i)(B)(2) or 4.02(b)(ii)(C),
as applicable, in each case for such Distribution Date.
Excess Proceeds: With respect to any Liquidated Mortgage Loan, the
amount, if any, by which the sum of any Liquidation Proceeds received with
respect to such Mortgage Loan during the calendar month in which such Mortgage
Loan became a Liquidated Mortgage Loan plus any Subsequent Recoveries received
with respect to such Mortgage Loan, net of any amounts previously reimbursed
to the Master Servicer as Nonrecoverable Advance(s) with respect to such
Mortgage Loan pursuant to Section 3.08(a)(iii), exceeds (i) the unpaid
principal balance of such Liquidated Mortgage Loan as of the Due Date in the
month in which such Mortgage Loan became a Liquidated Mortgage Loan plus (ii)
accrued interest at the Mortgage Rate from the Due Date as to which interest
was last paid or advanced (and not reimbursed) to Certificateholders up to the
Due Date applicable to the Distribution Date immediately following the
calendar month during which such liquidation occurred.
Exchange Act: The Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.
Exchange Act Reports: Any reports on Form 10-D, Form 8-K and Form 10-K
required to be filed by the Depositor with respect to the Trust Fund under the
Exchange Act.
Expense Fee: As to each Mortgage Loan and any Distribution Date, the
product of the related Expense Fee Rate and its Stated Principal Balance as of
that Distribution Date.
Expense Fee Rate: As to each Mortgage Loan and any date of
determination, the sum of (a) the related Master Servicing Fee Rate and (b)
the Trustee Fee Rate.
Extra Principal Distribution Amount: With respect to any Distribution
Date and Loan Group, the product of (a) the lesser of (1) the
Overcollateralization Deficiency Amount and (2) the Excess Cashflow available
for payment pursuant to Section 4.02(c) and (b) a fraction, the numerator of
which is the Principal Remittance Amount for such Loan Group and the
denominator of which is the sum of the Principal Remittance Amounts for both
Loan Groups.
FDIC: The Federal Deposit Insurance Corporation, or any successor
thereto.
FHLMC: The Federal Home Loan Mortgage Corporation, a corporate
instrumentality of the United States created and existing under Title III of
the Emergency Home Finance Act of 1970, as amended, or any successor to the
Federal Home Loan Mortgage Corporation.
Final Certification: As defined in Section 2.02(a).
FIRREA: The Financial Institutions Reform, Recovery, and Enforcement Act
of 1989.
Fitch: Fitch, Inc., or any successor thereto. If Fitch is designated as
a Rating Agency in the Preliminary Statement, for purposes of Section 10.05(b)
the address for notices to Fitch shall be Fitch, Inc., Xxx Xxxxx Xxxxxx Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Residential Mortgage Surveillance Group,
or such other address as Fitch may hereafter furnish to the Depositor and the
Master Servicer.
21
FNMA: The Federal National Mortgage Association, a federally chartered
and privately owned corporation organized and existing under the Federal
National Mortgage Association Charter Act, or any successor to the Federal
National Mortgage Association.
Form 10-D Disclosure Item: With respect to any Person, any material
litigation or governmental proceedings pending (a) against such Person, or (b)
against any of the Trust Fund, the Depositor, the Trustee, any co-trustee, the
Master Servicer or any Subservicer, if such Person has actual knowledge
thereof.
Form 10-K Disclosure Item: With respect to any Person, (a) any Form 10-D
Disclosure Item, and (b) any affiliations or relationships between such Person
and any Item 1119 Party.
Gross Margin: The percentage set forth in the related Mortgage Note for
the Mortgage Loans to be added to One-Year LIBOR for use in determining the
Mortgage Rate on each Adjustment Date, and which is set forth in the Mortgage
Loan Schedule.
Group 1 Mortgage Loans: The Mortgage Loans in Loan Group 1. Group 1
Principal Distribution Amount: For any Distribution Date, the product of (x)
the Senior Principal Distribution Target Amount and (y) a fraction, the
numerator of which is the Group 1 Principal Distribution Target Amount and the
denominator of which is the sum of the Group 1 Principal Distribution Target
Amount and the Group 2 Principal Distribution Target Amount.
Group 1 Principal Distribution Target Amount: For any Distribution Date,
the excess of:
(1) the aggregate Class Certificate Balance of the Group 1 Senior
Certificates immediately prior to such Distribution Date, over
(2) the lesser of (x) 84.10% of the aggregate Stated Principal Balance
of the Group 1 Mortgage Loans as of the Due Date in the month of that
Distribution Date (after giving effect to Principal Prepayments, the principal
portion of any Liquidation Proceeds and any Subsequent Recoveries received in
the related Prepayment Period) and (y) the aggregate Stated Principal Balance
of the Group 1 Mortgage Loans as of the Due Date in the month of that
Distribution Date (after giving effect to Principal Prepayments, the principal
portion of any Liquidation Proceeds and any Subsequent Recoveries received in
the related Prepayment Period) minus 0.35% of the aggregate Stated Principal
Balance of the Group 1 Mortgage Loans as of the Cut-Off Date.
Group 2 Mortgage Loans: The Mortgage Loans in Loan Group 2.
Group 2 Principal Distribution Amount: For any Distribution Date, the
product of (x) the Senior Principal Distribution Target Amount and (y) a
fraction, the numerator of which is the Group 2 Principal Distribution Target
Amount and the denominator of which is the sum of Group 1 Principal
Distribution Target Amount and the Group 2 Principal Distribution Target
Amount.
Group 2 Principal Distribution Target Amount: For any Distribution Date,
the excess of:
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(1) the aggregate Class Certificate Balance of the Group 2 Senior
Certificates immediately prior to such Distribution Date, over
(2) the lesser of (x) 84.10% of the aggregate Stated Principal Balance
of the Group 2 Mortgage Loans as of the Due Date in the month of that
Distribution Date (after giving effect to Principal Prepayments, the principal
portion of any Liquidation Proceeds and any Subsequent Recoveries received in
the related Prepayment Period) and (y) the aggregate Stated Principal Balance
of the Group 2 Mortgage Loans as of the Due Date in the month of that
Distribution Date (after giving effect to Principal Prepayments, the principal
portion of any Liquidation Proceeds and any Subsequent Recoveries received in
the related Prepayment Period) minus 0.35% of the aggregate Stated Principal
Balance of the Mortgage Loans in Loan Group 2 as of the Cut-Off Date.
Index: With respect to any Interest Accrual Period for the COFI
Certificates, if any, the then-applicable index used by the Trustee pursuant
to Section 4.07 to determine the applicable Pass-Through Rate for such
Interest Accrual Period for the COFI Certificates.
Indirect Participant: A broker, dealer, bank or other financial
institution or other Person that clears through or maintains a custodial
relationship with a Depository Participant.
Initial Certification: As defined in Section 2.02(a).
Initial Component Balance: As specified in the Preliminary Statement.
Initial Periodic Rate Cap: As to each Mortgage Loan and the related
Mortgage Note, the provision therein that limits permissible increases and
decreases in the Mortgage Rate on the first Adjustment Date for that Mortgage
Loan to not more than the amount set forth therein.
Insurance Policy: With respect to any Mortgage Loan included in the
Trust Fund, any insurance policy, including all riders and endorsements
thereto in effect, including any replacement policy or policies for any
Insurance Policies.
Insurance Proceeds: Proceeds paid by an insurer pursuant to any
Insurance Policy, in each case other than any amount included in such
Insurance Proceeds in respect of Insured Expenses.
Insured Expenses: Expenses covered by an Insurance Policy or any other
insurance policy with respect to the Mortgage Loans.
Interest Accrual Period: With respect to each Class of Delay
Certificates, its corresponding REMIC Regular Interest and any Distribution
Date, the calendar month prior to the month of such Distribution Date. With
respect to any Class of Non-Delay Certificates, its corresponding REMIC
Regular Interest and any Distribution Date, the period commencing on the
Distribution Date in the month preceding the month in which such Distribution
Date occurs (other than the first Distribution Date, for which it is the
Closing Date) and ending on the day preceding such Distribution Date.
Interest Carry Forward Amount: With respect to each Class of Offered
Certificates and each Distribution Date, the excess of (i) the Current
Interest for such Class with respect to prior
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Distribution Dates over (ii) the amount actually distributed to such Class
with respect to interest on such prior Distribution Dates.
Interest Determination Date: With respect to (a) any Interest Accrual
Period for any LIBOR Certificates and (b) any Interest Accrual Period for the
COFI Certificates for which the applicable Index is LIBOR, the second Business
Day prior to the first day of such Interest Accrual Period.
Interest Funds: With respect to any Distribution Date and Loan Group,
the excess of the Interest Remittance Amount for that Loan Group over the
portion of the Trustee Fee for such Distribution Date allocable to such Loan
Group.
Interest Remittance Amount: With respect to the Mortgage Loans in a Loan
Group and any Distribution Date, (x) the sum, without duplication, of (i) all
scheduled interest on the Mortgage Loans in that Loan Group due on the related
Due Date and received on or prior to the related Determination Date, less the
related Master Servicing Fees and any payments made in respect of premiums on
Lender PMI Mortgage Loans, (ii) all interest on prepayments on the Mortgage
Loans in that Loan Group, other than Prepayment Interest Excess, (iii) all
Advances relating to interest with respect to the Mortgage Loans in that Loan
Group, (iv) all Compensating Interest with respect to such Mortgage Loans in
that Loan Group and (v) Liquidation Proceeds with respect to the Mortgage
Loans in that Loan Group during the related Prepayment Period (to the extent
such Liquidation Proceeds relate to interest), less (y) all reimbursements to
the Master Servicer since the immediately preceding Due Date for Advances of
interest previously made allocable to such Loan Group.
Investment Letter: As defined in Section 5.02(b).
Item 1119 Party: The Depositor, any Seller, the Master Servicer, the
Trustee, any Subservicer, any originator identified in the Prospectus
Supplement, the Swap Counterparty and any other material transaction party, as
identified in Exhibit X hereto, as updated pursuant to Section 11.04.
Latest Possible Maturity Date: The Distribution Date following the third
anniversary of the scheduled maturity date of the Mortgage Loan having the
latest scheduled maturity date as of the Cut-off Date.
Lender PMI Mortgage Loan: Certain Mortgage Loans as to which the lender
(rather than the Mortgagor) acquires the Primary Insurance Policy and charges
the related Mortgagor an interest premium.
LIBOR: The London interbank offered rate for one-month United States
dollar deposits calculated in the manner described in Section 4.08. LIBOR
Certificates: As specified in the Preliminary Statement.
Limited Exchange Act Reporting Obligations: The obligations of the
Master Servicer under Section 3.16(b), Section 6.02 and Section 6.04 with
respect to notice and information to be provided to the Depositor and Article
XI (except Section 11.07(a)(1) and (2)).
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Liquidated Mortgage Loan: With respect to any Distribution Date, a
defaulted Mortgage Loan (including any REO Property) that was liquidated in
the calendar month preceding the month of such Distribution Date and as to
which the Master Servicer has determined (in accordance with this Agreement)
that it has received all amounts it expects to receive in connection with the
liquidation of such Mortgage Loan, including the final disposition of an REO
Property.
Liquidation Proceeds: Amounts, including Insurance Proceeds, received in
connection with the partial or complete liquidation of defaulted Mortgage
Loans, whether through trustee's sale, foreclosure sale or otherwise or
amounts received in connection with any condemnation or partial release of a
Mortgaged Property and any other proceeds received in connection with an REO
Property, less the sum of related unreimbursed Master Servicing Fees,
Servicing Advances and Advances.
Loan Group: Any of Loan Group 1 and Loan Group 2, as applicable.
Loan Group 1: All Mortgage Loans identified as Loan Group 1 Mortgage
Loans on the Mortgage Loan Schedule.
Loan Group 2: All Mortgage Loans identified as Loan Group 2 Mortgage
Loans on the Mortgage Loan Schedule.
Loan-to-Value Ratio: With respect to any Mortgage Loan and as to any
date of determination, the fraction (expressed as a percentage) the numerator
of which is the principal balance of the related Mortgage Loan at that date of
determination and the denominator of which is the Appraised Value of the
related Mortgaged Property.
Lost Mortgage Note: Any Mortgage Note the original of which was
permanently lost or destroyed and has not been replaced.
Maintenance: With respect to any Cooperative Unit, the rent paid by the
Mortgagor to the Cooperative Corporation pursuant to the Proprietary Lease.
Majority in Interest: As to any Class of Regular Certificates, the
Holders of Certificates of such Class evidencing, in the aggregate, at least
51% of the Percentage Interests evidenced by all Certificates of such Class.
Master REMIC: As described in the Preliminary Statement.
Master Servicer: Countrywide Home Loans Servicing LP, a Texas limited
partnership, and its successors and assigns, in its capacity as master
servicer hereunder.
Master Servicer Advance Date: As to any Distribution Date, 12:30 p.m.
Pacific time on the Business Day immediately preceding such Distribution Date.
Master Servicing Fee: As to each Mortgage Loan and any Distribution
Date, an amount payable out of each full payment of interest received on such
Mortgage Loan and equal to one-twelfth of the Master Servicing Fee Rate
multiplied by the Stated Principal Balance of such
25
Mortgage Loan as of the Due Date in the month preceding the month of such
Distribution Date, subject to reduction as provided in Section 3.14.
Master Servicing Fee Rate: With respect to each Mortgage Loan, the per
annum rate set forth on the Mortgage Loan Schedule for such Mortgage Loan.
Maximum Mortgage Rate: With respect to each Mortgage Loan, the maximum
rate of interest set forth as such in the related Mortgage Note.
MERS: Mortgage Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of the State of Delaware, or any
successor to Mortgage Electronic Registration Systems, Inc.
MERS Mortgage Loan: Any Mortgage Loan registered with MERS on the
MERS(r) System.
MERS(r) System: The system of recording transfers of mortgages
electronically maintained by MERS.
MIN: The mortgage identification number for any MERS Mortgage Loan.
Minimum Mortgage Rate: With respect to each Mortgage Loan, the minimum
rate of interest set forth as such in the related Mortgage Note, which, with
respect to certain Mortgage Loans is equal to the related Gross Margin.
MOM Loan: Any Mortgage Loan as to which MERS is acting as mortgagee,
solely as nominee for the originator of such Mortgage Loan and its successors
and assigns.
Monthly Statement: The statement delivered to the Certificateholders
pursuant to Section 4.06.
Moody's: Xxxxx'x Investors Service, Inc., or any successor thereto. If
Xxxxx'x is designated as a Rating Agency in the Preliminary Statement, for
purposes of Section 10.05(b) the address for notices to Moody's shall be
Xxxxx'x Investors Service, Inc., 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Residential Pass-Through Monitoring, or such other address as
Moody's may hereafter furnish to the Depositor or the Master Servicer.
Mortgage: The mortgage, deed of trust or other instrument creating a
first lien on an estate in fee simple or leasehold interest in real property
securing a Mortgage Note.
Mortgage File: The mortgage documents listed in Section 2.01 pertaining
to a particular Mortgage Loan and any additional documents delivered to the
Trustee to be added to the Mortgage File pursuant to this Agreement.
Mortgage Loan Schedule: The list of Mortgage Loans (as from time to time
amended by the Master Servicer to reflect the addition of Substitute Mortgage
Loans and the deletion of Deleted Mortgage Loans pursuant to the provisions of
this Agreement) transferred to the Trustee as part of the Trust Fund and from
time to time subject to this Agreement, attached to this
26
Agreement as Schedule I, setting forth the following information with respect
to each Mortgage Loan:
(i) the loan number;
(ii) the Loan Group;
(iii) the Mortgagor's name and the street address of the Mortgaged
Property, including the zip code;
(iv) the maturity date;
(v) the original principal balance;
(vi) the Cut-off Date Principal Balance;
(vii) the first payment date of the Mortgage Loan;
(viii) the Scheduled Payment in effect as of the Cut-off Date;
(ix) the Loan-to-Value Ratio at origination;
(x) a code indicating whether the residential dwelling at the time
of origination was represented to be owner-occupied;
(xi) a code indicating whether the residential dwelling is either
(a) a detached or attached single family dwelling, (b) a dwelling
in a de minimis PUD, (c) a condominium unit or PUD (other than a
de minimis PUD) or (d) a two- to four-unit residential property or
(e) a Cooperative Unit;
(xii) the Mortgage Rate as of the Cut-off Date, the Gross Margin,
the Initial Periodic Rate Cap, the Subsequent Periodic Rate Cap,
the Maximum Mortgage Rate and the Minimum Mortgage Rate;
(xiii) the initial Adjustment Date and the Master Servicing Fee
Rate both before and after the initial Adjustment Date for each
Mortgage Loan;
(xiv) a code indicating whether the Mortgage Loan is a Lender PMI
Mortgage Loan and, in the case of any Lender PMI Mortgage Loan, a
percentage representing the amount of the related interest premium
charged to the borrower;
(xv) the purpose for the Mortgage Loan;
(xvi) the type of documentation program pursuant to which the
Mortgage Loan was originated;
(xvii) a code indicating whether the Mortgage Loan is a
Countrywide Mortgage Loan, a Park Granada Mortgage Loan, a Park
Monaco Mortgage Loan or a Park Sienna Mortgage Loan;
27
(xviii) the direct servicer of such Mortgage Loan as of the
Cut-off Date; and
(xix) a code indicating whether the Mortgage Loan is a MERS
Mortgage Loan.
Such schedule shall also set forth the total of the amounts described
under (iv) and (v) above for all of the Mortgage Loans and for each Loan
Group.
Mortgage Loans: Such of the mortgage loans as from time to time are
transferred and assigned to the Trustee pursuant to the provisions of this
Agreement and that are held as a part of the Trust Fund (including any REO
Property), the mortgage loans so held being identified in the Mortgage Loan
Schedule, notwithstanding foreclosure or other acquisition of title of the
related Mortgaged Property.
Mortgage Note: The original executed note or other evidence of
indebtedness evidencing the indebtedness of a Mortgagor under a Mortgage Loan.
Mortgage Pool: The aggregate of the Mortgage Loans identified in the
Mortgage Loan Schedule.
Mortgage Rate: The annual rate of interest borne by a Mortgage Note from
time to time, net of any interest premium charged by the mortgagee to obtain
or maintain any Primary Insurance Policy.
Mortgaged Property: The underlying property securing a Mortgage Loan,
which, with respect to a Cooperative Loan, is the related Coop Shares and
Proprietary Lease.
Mortgagor: The obligor(s) on a Mortgage Note.
National Cost of Funds Index: The National Monthly Median Cost of Funds
Ratio to SAIF-Insured Institutions published by the Office of Thrift
Supervision.
Net Prepayment Interest Shortfalls: As to any Distribution Date and Loan
Group, the excess of the amount of the aggregate Prepayment Interest
Shortfalls for that Loan Group during the related Prepayment Period over the
sum of (i) the Compensating Interest for such Loan Group and Distribution Date
and (ii) the excess, if any, of the Compensating Interest for the other Loan
Group for such Distribution Date over the Prepayment Interest Shortfall for
such other Loan Group.
Net Rate Cap: For each Distribution Date and the Group 1 Senior
Certificates, the weighted average Adjusted Net Mortgage Rate on the Group 1
Mortgage Loans as of the Due Date in the prior calendar month (after giving
effect to Principal Prepayments received in the Prepayment Period related to
that prior Due Date), adjusted to an effective rate reflecting the accrual of
interest on the basis of a 360-day year and the actual number of days that
elapsed in the related Interest Accrual Period, minus (B) the sum of (i) the
product of (a) a fraction, the numerator of which is the Class A-IO-1
Component Notional Amount and, the denominator of which is the aggregate
Stated Principal Balance of the Group 1 Mortgage Loans as of the Due Date in
the prior calendar month (after giving effect to Principal Prepayments
received in the Prepayment Period related to that prior Due Date) adjusted to
an effective rate reflecting the accrual of interest on the basis of a 360-day
year and the actual number of days that elapsed in the related Interest
Accrual Period, and (b) the Pass-Through Rate on the Class A-IO-1 Component,
adjusted to an effective rate reflecting the accrual of interest on the basis
of a 360-day year and the actual number of days that elapsed in
28
the related Interest Accrual Period, and (ii) the Swap Adjustment Rate for
such Distribution Date and Loan Group 1. For each Distribution Date and the
Group 2 Senior Certificates, the weighted average Adjusted Net Mortgage Rate
on the Group 2 Mortgage Loans as of the Due Date in the prior calendar month
(after giving effect to Principal Prepayments received in the Prepayment
Period related to that prior Due Date), adjusted to an effective rate
reflecting the accrual of interest on the basis of a 360-day year and the
actual number of days that elapsed in the related Interest Accrual Period,
minus the sum of (i) the product of (a) a fraction, the numerator of which is
the Class A-IO-2 Component Notional Balance and, the denominator of which is
the aggregate Stated Principal Balance of the Group 2 Mortgage Loans as of the
Due Date in the prior calendar month (after giving effect to Principal
Prepayments received in the Prepayment Period related to that prior Due Date)
adjusted to an effective rate reflecting the accrual of interest on the basis
of a 360-day year and the actual number of days that elapsed in the related
Interest Accrual Period, and (b) the Pass-Through Rate on the Class A-IO-2
Component, adjusted to an effective rate reflecting the accrual of interest on
the basis of a 360-day year and the actual number of days that elapsed in the
related Interest Accrual Period, and (ii) the Swap Adjustment Rate for such
Distribution Date and Loan Group 2. For each Distribution Date and the
Subordinated Certificates, the weighted average of the Net Rate Caps for the
Group 1 Senior Certificates and the Group 2 Senior Certificates, in each case,
weighted on the basis of the excess of the aggregate Stated Principal Balance
of the Group 1 Mortgage Loans and the Group 2 Mortgage Loans, respectively, in
each case as of the Due Date in the prior calendar month (after giving effect
to Principal Prepayments, the principal portion of Liquidation Proceeds and
any Subsequent Recoveries received in the Prepayment Period related to that
prior Due Date), over the aggregate Class Certificate Balance of the Group 1
Senior Certificates and the aggregate Class Certificate Balance of the Group 2
Senior Certificates, respectively.
Net Rate Carryover: For any Class of Offered Certificates and any
Distribution Date, the sum of (A) the excess of (i) the amount of interest
that such Class would otherwise have accrued for such Distribution Date had
the applicable Pass-Through Rate for such Class not been determined based on
the applicable Net Rate Cap, over (ii) the amount of interest accrued on such
Class at the applicable Net Rate Cap for such Distribution Date and (B) the
Net Rate Carryover for such Class for all previous Distribution Dates not
previously paid pursuant to Section 4.02, together with interest thereon at
the then applicable Pass-Through Rate for such Class, without giving effect to
the applicable Net Rate Cap.
Net Swap Payment: With respect to any Distribution Date and payment by
the Swap Contract Administrator to the Swap Counterparty, the excess, if any,
of the "Fixed Amount" (as defined in the Swap Contract) with respect to such
Distribution Date over the "Floating Amount" (as defined in the Swap Contract)
with respect to such Distribution Date. With respect to any Distribution Date
and payment by the Swap Counterparty to the Swap Contract Administrator, the
excess, if any, of the "Floating Amount" (as defined in the Swap Contract)
with respect to such Distribution Date over the "Fixed Amount" (as defined in
the Swap Contract) with respect to such Distribution Date.
NIM Insurer: Any insurer guarantying at the request of Countrywide
certain payments under notes backed or secured by the Class C or Class P
Certificates.
29
Non-Delay Certificates: As specified in the Preliminary Statement.
Nonrecoverable Advance: Any portion of an Advance previously made or
proposed to be made by the Master Servicer that, in the good faith judgment of
the Master Servicer, will not be ultimately recoverable by the Master Servicer
from the related Mortgagor, related Liquidation Proceeds or otherwise.
Notice of Final Distribution: The notice to be provided pursuant to
Section 9.02 to the effect that final distribution on any of the Certificates
shall be made only upon presentation and surrender thereof.
Notional Amount: Not applicable.
Notional Amount Certificates: As specified in the Preliminary Statement.
OC Floor: An amount equal to 0.35% of the Cut-off Date Pool Principal
Balance of the Mortgage Loans.
Offered Certificates: As specified in the Preliminary Statement.
Officer's Certificate: A certificate (i) in the case of the Depositor,
signed by the Chairman of the Board, the Vice Chairman of the Board, the
President, a Managing Director, a Vice President (however denominated), an
Assistant Vice President, the Treasurer, the Secretary, or one of the
Assistant Treasurers or Assistant Secretaries of the Depositor, (ii) in the
case of the Master Servicer, signed by the President, an Executive Vice
President, a Vice President, an Assistant Vice President, the Treasurer, or
one of the Assistant Treasurers or Assistant Secretaries of Countrywide GP,
Inc., its general partner, (iii) if provided for in this Agreement, signed by
a Servicing Officer, as the case may be, and delivered to the Depositor and
the Trustee, as the case may be, as required by this Agreement or (iv) in the
case of any other Person, signed by an authorized officer of such Person.
One-Year LIBOR: As of any date of determination, the per annum rate
equal to the average of the London interbank offered rates for one-year U.S.
dollar deposits in the London market, generally as set forth in either The
Wall Street Journal or some other source generally accepted in the residential
mortgage loan origination business and specified in the related Mortgage Note,
or, if such rate ceases to be published in The Wall Street Journal or becomes
unavailable for any reason, then based upon a new index selected by the Master
Servicer, based on comparable information, in each case, as most recently
announced as of either 45 days prior to, or the first business day of the
month immediately preceding the month of, such Adjustment Date.
Opinion of Counsel: A written opinion of counsel, who may be counsel for
a Seller, the Depositor or the Master Servicer, including, in-house counsel,
reasonably acceptable to the Trustee; provided, however, that with respect to
the interpretation or application of the REMIC Provisions, such counsel must
(i) in fact be independent of a Seller, the Depositor and the Master Servicer,
(ii) not have any direct financial interest in a Seller, the Depositor or the
30
Master Servicer or in any affiliate thereof, and (iii) not be connected with a
Seller, the Depositor or the Master Servicer as an officer, employee,
promoter, underwriter, trustee, partner, director or person performing similar
functions.
Optional Termination Date: The first Distribution Date on which the
aggregate Stated Principal Balance of the Mortgage Loans is less than or equal
to 10% of the aggregate Stated Principal Balance of the Mortgage Loans as of
the Cut-off Date.
Original Mortgage Loan: The mortgage loan refinanced in connection with
the origination of a Refinancing Mortgage Loan.
OTS: The Office of Thrift Supervision.
Outside Reference Date: As to any Interest Accrual Period for the COFI
Certificates, the close of business on the tenth day thereof.
Outstanding: With respect to the Certificates as of any date of
determination, all Certificates theretofore executed and authenticated under
this Agreement except:
(i) Certificates theretofore canceled by the Trustee or delivered
to the Trustee for cancellation; and
(ii) Certificates in exchange for which or in lieu of which other
Certificates have been executed and delivered by the Trustee
pursuant to this Agreement.
Outstanding Mortgage Loan: As of any Due Date, a Mortgage Loan with a
Stated Principal Balance greater than zero, which was not the subject of a
Principal Prepayment in Full prior to the end of the related Prepayment Period
and which did not become a Liquidated Mortgage Loan prior to the end of the
related Prepayment Period.
Overcollateralization Deficiency Amount: With respect to any
Distribution Date, the amount, if any, by which the Overcollateralization
Target Amount exceeds the Overcollateralized Amount on such Distribution Date
(after giving effect to distributions in respect of the Principal Remittance
Amount for each Loan Group on such Distribution Date).
Overcollateralization Target Amount: With respect to any Distribution
Date the OC Floor.
Overcollateralized Amount: For any Distribution Date, the amount, if
any, by which (x) the aggregate Stated Principal Balance of the Mortgage Loans
(after giving effect to Principal Prepayments, the principal portion of any
Liquidation Proceeds and any Subsequent Recoveries received in the related
Prepayment Period) as of the Due Date in the month of that Distribution Date
exceeds (y) the aggregate Class Certificate Balance of the Offered
Certificates as of such Distribution Date (after giving effect to
distributions of the Principal Remittance Amount for each Loan Group to be
made on such Distribution Date).
Ownership Interest: As to any Residual Certificate, any ownership
interest in such Certificate including any interest in such Certificate as the
Holder thereof and any other interest therein, whether direct or indirect,
legal or beneficial.
00
Xxxx Xxxxxxx: Xxxx Xxxxxxx LLC, a Delaware limited liability company,
and its successors and assigns, in its capacity as the seller of the Park
Granada Mortgage Loans to the Depositor.
Park Granada Mortgage Loans: The Mortgage Loans identified as such on
the Mortgage Loan Schedule for which Park Granada is the applicable Seller.
Park Monaco: Park Monaco Inc., a Delaware corporation, and its
successors and assigns, in its capacity as the seller of the Park Monaco
Mortgage Loans to the Depositor.
Park Monaco Mortgage Loans: The Mortgage Loans identified as such on the
Mortgage Loan Schedule for which Park Monaco is the applicable Seller.
Park Sienna: Park Sienna LLC, a Delaware limited liability company, and
its successors and assigns, in its capacity as the seller of the Park Sienna
Mortgage Loans to the Depositor.
Park Sienna Mortgage Loans: The Mortgage Loans identified as such on the
Mortgage Loan Schedule for which Park Sienna is the applicable Seller.
Pass-Through Margin: With respect to the Interest Accrual Period for any
Distribution Date and Class of LIBOR Certificates, the per annum rate
indicated in the following table:
Class Pass-Through Margin (1) Pass-Through Margin (2)
Class 1-A-1............. 0.230% 0.460%
Class 1-A-2............. 0.290% 0.580%
Class 2-A-1............. 0.090% 0.180%
Class 2-A-2............. 0.200% 0.400%
Class 2-A-3A............ 0.320% 0.640%
Class 2-A-3B............ 0.380% 0.760%
Class M-1............... 0.390% 0.585%
Class M-2............... 0.410% 0.615%
Class M-3............... 0.430% 0.645%
Class M-4............... 0.550% 0.825%
Class M-5............... 0.590% 0.885%
Class M-6............... 0.700% 1.050%
Class M-7............... 1.450% 2.175%
Class M-8............... 1.600% 2.400%
---------------
(1) For the Interest Accrual Period related to any Distribution Date occurring on or prior to the Optional
Termination Date.
(2) For the Interest Accrual Period related to any Distribution Date occurring after the Optional Termination
Date.
Pass-Through Rate: With respect to any Interest Accrual Period and each
Class of LIBOR Certificates the lesser of (x) LIBOR for such Interest Accrual
Period plus the Pass-Through Margin for such Class and Interest Accrual Period
and (y) the applicable Net Rate Cap for such Class and the related
Distribution Date. With respect to the Class A-IO Certificates and
32
any Interest Accrual Period related to each Distribution Date on or before the
Distribution Date in January 2007, 1.10%, and thereafter, 0%.
Percentage Interest: As to any Certificate, the percentage interest
evidenced thereby in distributions required to be made on the related Class,
such percentage interest being set forth on the face thereof or equal to the
percentage obtained by dividing the Denomination of such Certificate by the
aggregate of the Denominations of all Certificates of the same Class. With
respect to the Class C, Class P and Class A-R Certificates, the portion of the
Class evidenced thereby, expressed as a percentage, as stated on the face of
such Certificate.
Performance Certification: As defined in Section 11.05.
Permitted Investments: At any time, any one or more of the following
obligations and securities:
(i) obligations of the United States or any agency thereof,
provided such obligations are backed by the full faith and credit
of the United States;
(ii) general obligations of or obligations guaranteed by any state
of the United States or the District of Columbia receiving the
highest long-term debt rating of each Rating Agency, or such lower
rating as will not result in the downgrading or withdrawal of the
ratings then assigned to the Certificates by each Rating Agency;
(iii) commercial or finance company paper which is then receiving
the highest commercial or finance company paper rating of each
Rating Agency, or such lower rating as will not result in the
downgrading or withdrawal of the ratings then assigned to the
Certificates by each Rating Agency;
(iv) certificates of deposit, demand or time deposits, or bankers'
acceptances issued by any depository institution or trust company
incorporated under the laws of the United States or of any state
thereof and subject to supervision and examination by federal
and/or state banking authorities, provided that the commercial
paper and/or long term unsecured debt obligations of such
depository institution or trust company (or in the case of the
principal depository institution in a holding company system, the
commercial paper or long-term unsecured debt obligations of such
holding company, but only if Xxxxx'x is not a Rating Agency) are
then rated one of the two highest long-term and the highest
short-term ratings of each Rating Agency for such securities, or
such lower ratings as will not result in the downgrading or
withdrawal of the rating then assigned to the Certificates by
either Rating Agency;
(v) repurchase obligations with respect to any security described
in clauses (i) and (ii) above, in either case entered into with a
depository institution or trust company (acting as principal)
described in clause (iv) above;
(vi) units of a taxable money-market portfolio having the highest
rating assigned by each Rating Agency (except if Fitch is a Rating
Agency and has not rated the portfolio, the highest rating
assigned by Moody's) and restricted to
33
obligations issued or guaranteed by the United States of America
or entities whose obligations are backed by the full faith and
credit of the United States of America and repurchase agreements
collateralized by such obligations; and
(vii) such other relatively risk free investments bearing interest
or sold at a discount acceptable to each Rating Agency as will not
result in the downgrading or withdrawal of the rating then
assigned to the Certificates by either Rating Agency, as evidenced
by a signed writing delivered by each Rating Agency, and
reasonably acceptable to the NIM Insurer, as evidenced by a signed
writing delivered by the NIM Insurer;
provided, that no such instrument shall be a Permitted Investment if such
instrument evidences the right to receive interest only payments with respect
to the obligations underlying such instrument.
Permitted Transferee: Any person other than (i) the United States, any
State or political subdivision thereof, or any agency or instrumentality of
any of the foregoing, (ii) a foreign government, International Organization or
any agency or instrumentality of either of the foregoing, (iii) an
organization (except certain farmers' cooperatives described in Section 521 of
the Code) which is exempt from tax imposed by Chapter 1 of the Code (including
the tax imposed by Section 511 of the Code on unrelated business taxable
income) on any excess inclusions (as defined in Section 860E(c)(1) of the
Code) with respect to any Residual Certificate, (iv) rural electric and
telephone cooperatives described in Section 1381(a)(2)(C) of the Code, (v) an
"electing large partnership" as defined in Section 775 of the Code, (vi) a
Person that is not a citizen or resident of the United States, a corporation,
partnership, or other entity created or organized in or under the laws of the
United States, any state thereof or the District of Columbia, or an estate or
trust whose income from sources without the United States is includible in
gross income for United States federal income tax purposes regardless of its
connection with the conduct of a trade or business within the United States or
a trust if a court within the United States is able to exercise primary
supervision over the administration of the trust and one or more United States
persons have the authority to control all substantial decisions of the trust
unless such Person has furnished the transferor and the Trustee with a duly
completed Internal Revenue Service Form W-8ECI or any applicable successor
form, and (vii) any other Person so designated by the Depositor based upon an
Opinion of Counsel that the Transfer of an Ownership Interest in a Residual
Certificate to such Person may cause any REMIC created under this Agreement to
fail to qualify as a REMIC at any time that the Certificates are outstanding.
The terms "United States," "State" and "International Organization" shall have
the meanings set forth in Section 7701 of the Code or successor provisions. A
corporation will not be treated as an instrumentality of the United States or
of any State or political subdivision thereof for these purposes if all of its
activities are subject to tax and, with the exception of the Federal Home Loan
Mortgage Corporation, a majority of its board of directors is not selected by
such government unit.
Person: Any individual, corporation, partnership, joint venture,
association, limited liability company, joint-stock company, trust,
unincorporated organization or government, or any agency or political
subdivision thereof.
Physical Certificate: As specified in the Preliminary Statement.
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Pool Stated Principal Balance: The aggregate of the Stated Principal
Balances of the Outstanding Mortgage Loans.
Prepayment Charge: With respect to any Mortgage Loan, the charges or
premiums, if any, due in connection with a full or partial prepayment of such
Mortgage Loan within the related Prepayment Charge Period in accordance with
the terms thereof.
Prepayment Charge Period: With respect to any Mortgage Loan, the period
of time during which a Prepayment Charge may be imposed.
Prepayment Charge Schedule: As of the Cut off Date with respect to each
Mortgage Loan, a list attached hereto as Schedule VII (including the
prepayment charge summary attached thereto), setting forth the following
information with respect to each Prepayment Charge:
(i) the Mortgage Loan identifying number;
(ii) a code indicating the type of Prepayment Charge;
(iii) the state of origination of the related Mortgage Loan;
(iv) the date on which the first monthly payment was due on the
related Mortgage Loan;
(v) the term of the related Prepayment Charge; and
(vi) the principal balance of the related Mortgage Loan as of
the Cut off Date.
As of the Closing Date, the Prepayment Charge Schedule shall contain the
necessary information for each Mortgage Loan. The Prepayment Charge Schedule
shall be amended from time to time by the Master Servicer in accordance with
the provisions of this Agreement and a copy of each related amendment shall be
furnished by the Master Servicer to the Class P and Class C Certificateholders
and the NIM Insurer.
Prepayment Interest Excess: As to any Principal
Prepayment received by the Master Servicer from the first day through the
fifteenth day of any calendar month (other than the calendar month in which
the Cut-off Date occurs), all amounts paid by the related Mortgagor in respect
of interest on such Principal Prepayment. All Prepayment Interest Excess shall
be paid to the Master Servicer as additional master servicing compensation.
Prepayment Interest Shortfall: As to any Distribution Date, Mortgage Loan and
Principal Prepayment received on or after the sixteenth day of the month
preceding the month of such Distribution Date (or, in the case of the first
Distribution Date, on or after January 1, 2006) and on or before the last day
of the month preceding the month of such Distribution Date, the amount, if
any, by which one month's interest at the related Mortgage Rate, net of the
related Master Servicing Fee Rate, on such Principal Prepayment exceeds the
amount of interest paid in connection with such Principal Prepayment.
Prepayment Period: As to any Distribution Date and the related Due Date, the
period from the 16th day of the calendar month immediately preceding the month
in which the
35
Distribution Date occurs (or, in the case of the first Distribution Date, from
January 1, 2006) through the 15th day of the calendar month in which the
Distribution Date occurs.
Primary Insurance Policy: Each policy of primary mortgage guaranty
insurance or any replacement policy therefor with respect to any Mortgage
Loan.
Prime Rate: The prime commercial lending rate of The Bank of New York,
as publicly announced to be in effect from time to time. The Prime Rate shall
be adjusted automatically, without notice, on the effective date of any change
in such prime commercial lending rate. The Prime Rate is not necessarily The
Bank of New York's lowest rate of interest.
Principal Distribution Amount: With respect to each Distribution Date
and Loan Group, the sum of: (1) the Principal Remittance Amount for such Loan
Group and Distribution Date, less any portion of such amount used to cover any
payment due to the Swap Counterparty with respect to such Distribution Date,
and (2) the Extra Principal Distribution Amount for such Loan Group and
Distribution Date.
Principal Prepayment: Any payment of principal by a Mortgagor on a
Mortgage Loan that is received in advance of its scheduled Due Date and is not
accompanied by an amount representing scheduled interest due on any date or
dates in any month or months subsequent to the month of prepayment. Partial
Principal Prepayments shall be applied by the Master Servicer in accordance
with the terms of the related Mortgage Note.
Principal Prepayment in Full: Any Principal Prepayment made by a
Mortgagor of the entire principal balance of a Mortgage Loan.
Principal Relocation Payments: A payment from any Loan Group to REMIC 2
Regular Interests other than those of their Corresponding Loan Group as
provided in the Preliminary Statement. Principal Relocation Payments shall be
made of principal allocations comprising the Principal Remittance Amount from
a Loan Group.
Principal Remittance Amount: As to any Distribution Date and either Loan
Group, (x) the sum, without duplication, of (a) the principal portion of each
Scheduled Payment (without giving effect to any reductions thereof caused by
any Debt Service Reductions or Deficient Valuations) due on each Mortgage Loan
in that Loan Group (other than a Liquidated Mortgage Loan) on the related Due
Date, (b) the principal portion of the Purchase Price of each Mortgage Loan in
that Loan Group that was repurchased by the applicable Seller or purchased by
the Master Servicer pursuant to this Agreement as of such Distribution Date,
(c) the Substitution Adjustment Amount in connection with any Deleted Mortgage
Loan in that Loan Group received with respect to such Distribution Date, (d)
any Insurance Proceeds or Liquidation Proceeds allocable to recoveries of
principal of Mortgage Loans in that Loan Group that are not yet Liquidated
Mortgage Loans received during the calendar month preceding the month of such
Distribution Date, (e) with respect to each Mortgage Loan in that Loan Group
that became a Liquidated Mortgage Loan during the related Prepayment Period,
the amount of the Liquidation Proceeds allocable to principal received during
such Prepayment Period with respect to such Mortgage Loan, (f) all Principal
Prepayments on the Mortgage Loans in that Loan Group received during the
related Prepayment Period and (g) any Subsequent Recoveries on the Mortgage
Loans in that Loan Group received during the related Prepayment Period minus
(y) all
36
Advances on the Mortgage Loans in that Loan Group relating to principal and
certain expenses reimbursable pursuant to Section 6.03 and reimbursed since
the immediately preceding Due Date.
Principal Reserve Fund: The separate Eligible Account created and
initially maintained by the Trustee pursuant to Section 3.05(c) in the name of
the Trustee for the benefit of the Holders of the Class A-R and Class P
Certificates and designated "The Bank of New York in trust for registered
holders of CWALT, Inc., Alternative Loan Trust 2006-OC1, Mortgage Pass-Through
Certificates, Series 2006-OC1." Funds in the Principal Reserve Fund shall be
held in trust for the Holders of the Class A-R and Class P Certificates for
the uses and purposes set forth in this Agreement.
Priority Amount: Not applicable.
Priority Percentage: Not applicable.
Private Certificate: As specified in the Preliminary Statement.
Proprietary Lease: With respect to any Cooperative Unit, a lease or
occupancy agreement between a Cooperative Corporation and a holder of related
Coop Shares.
Prospectus: The prospectus dated January 27, 2006 generally relating to
mortgage pass-through certificates to be sold by the Depositor.
Prospectus Supplement: The prospectus supplement dated January 27, 2006
relating to the Offered Certificates, as supplemented by the Supplement to the
Prospectus Supplement dated February 8, 2006.
PUD: Planned Unit Development.
Purchase Price: With respect to any Mortgage Loan required to be
purchased by the applicable Seller pursuant to Section 2.02 or 2.03 or
purchased at the option of the Master Servicer pursuant to Section 3.11, an
amount equal to the sum of (i) 100% of the unpaid principal balance of the
Mortgage Loan on the date of such purchase, (ii) accrued interest thereon at
the applicable Mortgage Rate (or at the applicable Adjusted Mortgage Rate if
(x) the purchaser is the Master Servicer or (y) if the purchaser is
Countrywide and Countrywide is an affiliate of the Master Servicer) from the
date through which interest was last paid by the Mortgagor to the Due Date in
the month in which the Purchase Price is to be distributed to
Certificateholders and (iii) costs and damages incurred by the Trust Fund in
connection with a repurchase pursuant to Section 2.03 that arises out of a
violation of any predatory or abusive lending law with respect to the related
Mortgage Loan.
Qualified Insurer: A mortgage guaranty insurance company duly qualified
as such under the laws of the state of its principal place of business and
each state having jurisdiction over such insurer in connection with the
insurance policy issued by such insurer, duly authorized and licensed in such
states to transact a mortgage guaranty insurance business in such states and
to write the insurance provided by the insurance policy issued by it, approved
as a FNMA-approved mortgage insurer and having a claims paying ability rating
of at least "AA" or equivalent rating
37
by a nationally recognized statistical rating organization. Any replacement
insurer with respect to a Mortgage Loan must have at least as high a claims
paying ability rating as the insurer it replaces had on the Closing Date.
Rating Agency: Each of the Rating Agencies specified in the Preliminary
Statement. If any such organization or a successor is no longer in existence,
"Rating Agency" shall be such nationally recognized statistical rating
organization, or other comparable Person, as is designated by the Depositor,
notice of which designation shall be given to the Trustee. References in this
Agreement to a given rating category of a Rating Agency shall mean such rating
category without giving effect to any modifiers.
Realized Loss: With respect to each Liquidated Mortgage Loan, an amount
(not less than zero or more than the Stated Principal Balance of the Mortgage
Loan) as of the date of such liquidation, equal to (i) the Stated Principal
Balance of the Liquidated Mortgage Loan as of the date of such liquidation,
plus (ii) interest at the Adjusted Net Mortgage Rate from the Due Date as to
which interest was last paid or advanced (and not reimbursed) to
Certificateholders up to the Due Date in the month in which Liquidation
Proceeds are required to be distributed on the Stated Principal Balance of
such Liquidated Mortgage Loan from time to time, minus (iii) the Liquidation
Proceeds, if any, received during the month in which such liquidation
occurred, to the extent applied as recoveries of interest at the Adjusted Net
Mortgage Rate and to principal of the Liquidated Mortgage Loan. With respect
to each Mortgage Loan which has become the subject of a Deficient Valuation,
if the principal amount due under the related Mortgage Note has been reduced,
the difference between the principal balance of the Mortgage Loan outstanding
immediately prior to such Deficient Valuation and the principal balance of the
Mortgage Loan as reduced by the Deficient Valuation. With respect to each
Mortgage Loan which has become the subject of a Debt Service Reduction and any
Distribution Date, the amount, if any, by which the principal portion of the
related Scheduled Payment has been reduced.
To the extent the Master Servicer receives Subsequent Recoveries with
respect to any Mortgage Loan, the amount of Realized Losses with respect to
that Mortgage Loan will be reduced by the amount of such Subsequent
Recoveries.
Recognition Agreement: With respect to any Cooperative Loan, an
agreement between the Cooperative Corporation and the originator of such
Mortgage Loan which establishes the rights of such originator in the
Cooperative Property.
Record Date: With respect to any Distribution Date and the Certificates
other than the LIBOR Certificates, the last Business Day of the month
preceding the month of a Distribution Date. With respect to any Distribution
Date and the LIBOR Certificates, the Business Day immediately preceding such
Distribution Date, or if such Certificates are no longer Book-Entry
Certificates, the last Business Day of the month preceding the month of such
Distribution Date.
Reference Bank: As defined in Section 4.08(b).
Refinancing Mortgage Loan: Any Mortgage Loan originated in connection
with the refinancing of an existing mortgage loan.
Regular Certificates: As specified in the Preliminary Statement.
38
Regulation AB: Subpart 229.1100 - Asset Backed Securities (Regulation
AB), 17 C.F.R. ss.ss.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.
Relief Act: The Servicemembers Civil Relief Act and any similar state or
local laws.
REMIC: A "real estate mortgage investment conduit" within the meaning of
Section 860D of the Code.
REMIC 1: As described in the Preliminary Statement.
REMIC 1 Interest: Any one of the REMIC Interests.
REMIC 1 Regular Interest: Any one of the "regular interests" in the
REMIC 1 described in the Preliminary Statement.
REMIC 2: As described in the Preliminary Statement.
REMIC 2 Interest: Any one of the REMIC 2 Interests or the R-2 Interest.
REMIC 2 Regular Interest: Any one of the "regular interests" in REMIC 2
described in the Preliminary Statement.
REMIC 3: As described in the Preliminary Statement.
REMIC 3 Interest: Any one of the REMIC 3 Interests or the R-3 Interest.
REMIC 3 Regular Interest: Any one of the "regular interests" in REMIC 3
described in the Preliminary Statement.
REMIC Change of Law: Any proposed, temporary or final regulation,
revenue ruling, revenue procedure or other official announcement or
interpretation relating to REMICs and the REMIC Provisions issued after the
Closing Date.
REMIC Provisions: Provisions of the federal income tax law relating to
real estate mortgage investment conduits, which appear at Sections 860A
through 860G of Subchapter M of Chapter 1 of the Code, and related provisions,
and regulations promulgated thereunder, as the foregoing may be in effect from
time to time as well as provisions of applicable state laws.
REO Property: A Mortgaged Property acquired by the Trust Fund through
foreclosure or deed-in-lieu of foreclosure in connection with a defaulted
Mortgage Loan.
Reportable Event: Any event required to be reported on Form 8-K, and in
any event, the following:
39
(a) entry into a definitive agreement related to the Trust Fund,
the Certificates or the Mortgage Loans, or an amendment to a Transaction
Document, even if the Depositor is not a party to such agreement (e.g.,
a servicing agreement with a servicer contemplated by Item 1108(a)(3) of
Regulation AB);
(b) termination of a Transaction Document (other than by
expiration of the agreement on its stated termination date or as a
result of all parties completing their obligations under such
agreement), even if the Depositor is not a party to such agreement
(e.g., a servicing agreement with a servicer contemplated by Item
1108(a)(3) of Regulation AB);
(c) with respect to the Master Servicer only, if the Master
Servicer becomes aware of any bankruptcy or receivership with respect to
Countrywide, the Depositor, the Master Servicer, any Subservicer, the
Trustee, the Swap Counterparty, any enhancement or support provider
contemplated by Items 1114(b) or 1115 of Regulation AB, or any other
material party contemplated by Item 1101(d)(1) of Regulation AB;
(d) with respect to the Trustee, the Master Servicer and the
Depositor only, the occurrence of an early amortization, performance
trigger or other event, including an Event of Default under this
Agreement;
(e) the resignation, removal, replacement, substitution of the
Master Servicer, any Subservicer or the Trustee;
(f) with respect to the Master Servicer only, if the Master
Servicer becomes aware that (i) any material enhancement or support
specified in Item 1114(a)(1) through (3) of Regulation AB or Item 1115
of Regulation AB that was previously applicable regarding one or more
classes of the Certificates has terminated other than by expiration of
the contract on its stated termination date or as a result of all
parties completing their obligations under such agreement; (ii) any
material enhancement specified in Item 1114(a)(1) through (3) of
Regulation AB or Item 1115 of Regulation AB has been added with respect
to one or more classes of the Certificates; or (iii) any existing
material enhancement or support specified in Item 1114(a)(1) through (3)
of Regulation AB or Item 1115 of Regulation AB with respect to one or
more classes of the Certificates has been materially amended or
modified; and
(g) with respect to the Trustee, the Master Servicer and the
Depositor only, a required distribution to Holders of the Certificates
is not made as of the required Distribution Date under this Agreement.
Reporting Subcontractor: With respect to the Master Servicer or the
Trustee, any Subcontractor determined by such Person pursuant to Section
11.08(b) to be "participating in the servicing function" within the meaning of
Item 1122 of Regulation AB. References to a Reporting Subcontractor shall
refer only to the Subcontractor of such Person and shall not refer to
Subcontractors generally
Request for Release: The Request for Release submitted by the Master
Servicer to the Trustee, substantially in the form of Exhibits M and N to this
Agreement, as appropriate.
40
Required Insurance Policy: With respect to any Mortgage Loan, any
insurance policy that is required to be maintained from time to time under
this Agreement.
Residual Certificates: As specified in the Preliminary Statement.
Responsible Officer: When used with respect to the Trustee, any Vice
President, any Assistant Vice President, the Secretary, any Assistant
Secretary, any Trust Officer or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also to whom, with respect to a particular matter, such matter is
referred because of such officer's knowledge of and familiarity with the
particular subject.
Rolling Sixty-Day Delinquency Rate: With respect to any Distribution
Date on or after the Stepdown Date, the average of the Sixty-Day Delinquency
Rates for such Distribution Date and the two immediately preceding
Distribution Dates.
S&P: Standard & Poor's, a division of The XxXxxx-Xxxx Companies, Inc. If
S&P is designated as a Rating Agency in the Preliminary Statement, for
purposes of Section 10.05(b) the address for notices to S&P shall be Standard
& Poor's, 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Mortgage
Surveillance Monitoring, or such other address as S&P may hereafter furnish to
the Depositor and the Master Servicer.
Xxxxxxxx-Xxxxx Certification: As defined in Section 11.05.
Scheduled Balances: Not applicable.
Scheduled Classes: As specified in the Preliminary Statement.
Scheduled Payment: The scheduled monthly payment on a Mortgage Loan due
on any Due Date allocable to principal and/or interest on such Mortgage Loan
which, unless otherwise specified in this Agreement, shall give effect to any
related Debt Service Reduction and any Deficient Valuation that affects the
amount of the monthly payment due on such Mortgage Loan.
Securities Act: The Securities Act of 1933, as amended.
Seller: Countrywide, Park Granada, Park Monaco or Park Sienna, as
applicable.
Senior Certificates: As specified in the Preliminary Statement.
Senior Enhancement Percentage: With respect to a Distribution Date on
and after the Stepdown Date, the fraction (expressed as a percentage) (1) the
numerator of which is the excess of (a) the aggregate Stated Principal Balance
of the Mortgage Loans for the preceding Distribution Date over (b) (i) before
the Class Certificate Balances of the Senior Certificates have been reduced to
zero, the sum of the Class Certificate Balances of the Senior Certificates, or
(ii) after the Class Certificate Balances of the Senior Certificates have been
reduced to zero, the Class Certificate Balance of the most senior Class of
Subordinate Certificates outstanding as of the preceding Master Servicer
Advance Date and (2) the denominator of which is the aggregate Stated
Principal Balance of the Mortgage Loans for the preceding Distribution Date.
41
Senior Principal Distribution Amount: As to any Distribution Date, the
sum of the Group 1 Principal Distribution Amount and the Group 2 Principal
Distribution Amount, in each case for such Distribution Date.
Senior Principal Distribution Target Amount: As to any Distribution
Date, the excess of (x) the aggregate Class Certificate Balance of the Senior
Certificates immediately prior to such Distribution Date, over (y) the lesser
of (i) 84.10% of the aggregate Stated Principal Balance of the Mortgage Loans
as of the Due Date in the month of such Distribution Date (after giving effect
to Principal Prepayments, the principal portion of any Liquidation Proceeds
and any Subsequent Recoveries received in the related Prepayment Period) and
(ii) the aggregate Stated Principal Balance of the Mortgage Loans as of the
Due Date in the month of such Distribution Date (after giving effect to
Principal Prepayments, the principal portion of any Liquidation Proceeds and
any Subsequent Recoveries received in the related Prepayment Period), minus
the OC Floor.
Senior Termination Date: For Senior Certificate Group 1, the
Distribution Date on which the aggregate Class Certificate Balance of the
Group 1 Senior Certificates has been reduced to zero. For Senior Certificate
Group 2, the Distribution Date on which the aggregate Class Certificate
Balance of the Group 2 Senior Certificates has been reduced to zero.
Servicing Advances: All customary, reasonable and necessary "out of
pocket" costs and expenses incurred in the performance by the Master Servicer
of its servicing obligations, including, but not limited to, the cost of (i)
the preservation, restoration and protection of a Mortgaged Property, (ii) any
expenses reimbursable to the Master Servicer pursuant to Section 3.11 and any
enforcement or judicial proceedings, including foreclosures, (iii) the
management and liquidation of any REO Property and (iv) compliance with the
obligations under Section 3.09.
Servicing Criteria: The "servicing criteria" set forth in Item 1122(d)
of Regulation AB.
Servicing Officer: Any officer of the Master Servicer involved in, or
responsible for, the administration and servicing of the Mortgage Loans whose
name and facsimile signature appear on a list of servicing officers furnished
to the Trustee by the Master Servicer on the Closing Date pursuant to this
Agreement, as such list may from time to time be amended.
Shift Percentage: Not applicable.
Sixty-Day Delinquency Rate: With respect to any Distribution Date on or
after the Stepdown Date, a fraction, expressed as a percentage, the numerator
of which is the aggregate Stated Principal Balance of all Mortgage Loans 60 or
more days delinquent as of the close of business on the last day of the
calendar month preceding such Distribution Date (including Mortgage Loans in
foreclosure, bankruptcy and REO Properties) and the denominator of which is
the aggregate Stated Principal Balance for such Distribution Date of the
Mortgage Loans as of the related Due Date (after giving effect to Principal
Prepayments, the principal portion of any Liquidation Proceeds and any
Subsequent Recoveries received in the related Prepayment Period).
Startup Day: The Closing Date.
42
Stated Principal Balance: As to any Mortgage Loan and Due Date, the
unpaid principal balance of such Mortgage Loan as of such Due Date, as
specified in the amortization schedule at the time relating thereto (before
any adjustment to such amortization schedule by reason of any moratorium or
similar waiver or grace period) after giving effect to the sum of: (i) any
previous partial Principal Prepayments and the payment of principal due on
such Due Date, irrespective of any delinquency in payment by the related
Mortgagor, and (ii) Liquidation Proceeds allocable to principal (other than
with respect to any Liquidated Mortgage Loan) received in the prior calendar
month and Principal Prepayments received through the last day of the related
Prepayment Period, in each case, with respect to that Mortgage Loan.
Stepdown Date: The earlier to occur of: (1) the Distribution Date on
which the aggregate Class Certificate Balance of the Senior Certificates is
reduced to zero, and (2) the later to occur of (x) the Distribution Date in
February 2009 and (y) the first Distribution Date on which the aggregate Class
Certificate Balance of the Senior Certificates (after calculating anticipated
distributions on such Distribution Date) is less than or equal to 84.10% of
the aggregate Stated Principal Balance of the Mortgage Loans as of the Due
Date in the month of that Distribution Date (after giving effect to Principal
Prepayments, the principal portion of any Liquidation Proceeds and any
Subsequent Recoveries received in the Prepayment Period related to that prior
Due Date).
Stepdown Target Subordination Percentage: With respect to any Class of
Subordinated Certificates, the respective percentage indicated in the
following table:
Stepdown Target
Subordination
Percentage
------------------
Class M-1..................................... 12.50%
Class M-2..................................... 9.50%
Class M-3..................................... 7.60%
Class M-4..................................... 6.10%
Class M-5..................................... 4.50%
Class M-6..................................... 3.10%
Class M-7..................................... 1.70%
Class M-8..................................... 0.70%
Streamlined Documentation Mortgage Loan: Any Mortgage Loan originated
pursuant to Countrywide's Streamlined Loan Documentation Program then in
effect. For the purposes of this Agreement, a Mortgagor is eligible for a
mortgage pursuant to Countrywide's Streamlined Loan Documentation Program if
that Mortgagor is refinancing an existing mortgage loan that was originated or
acquired by Countrywide where, among other things, the mortgage loan has not
been more than 30 days delinquent in payment during the previous twelve month
period.
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 1122(d) of
Regulation AB with respect to the Mortgage Loans under the direction or
authority of the Master Servicer or a Subservicer or the Trustee, as the case
may be.
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Subordinated Certificates: As specified in the Preliminary Statement.
Subordinated Class Principal Distribution Target Amount: With respect to
any Distribution Date and any Class of Subordinated Certificates and
Distribution Date will equal the excess of: (1) the sum of: (a) the aggregate
Class Certificate Balance of the Senior Certificates (after taking into
account the distribution of the Senior Principal Distribution Amount for such
Distribution Date), (b) the aggregate Class Certificate Balance of any
Class(es) of Subordinated Certificates that are senior to the subject Class
(in each case, after taking into account distribution of the Subordinated
Class Principal Distribution Target Amount(s) for such more senior Class(es)
of Certificates for such Distribution Date), and (c) the Class Certificate
Balance of the subject Class of Subordinated Certificates immediately prior to
such Distribution Date over (2) the lesser of (a) the product of (x) 100%
minus the Stepdown Target Subordination Percentage for the subject Class of
Certificates and (y) the aggregate Stated Principal Balance of the Mortgage
Loans in the Mortgage Pool for such Distribution Date and (b) the aggregate
Stated Principal Balance of the Mortgage Loans in the Mortgage Pool for such
Distribution Date minus the OC Floor; provided, however, that if such Class of
Subordinated Certificates is the only Class of Subordinated Certificates
outstanding on such Distribution Date, that Class will be entitled to receive
the entire remaining Principal Distribution Amount until its Class Certificate
Balance is reduced to zero.
Subordinate Net Rate Cap: For each Distribution Date, the weighted
average of the Group 1 Net Rate Cap and the Group 2 Net Rate Cap weighted on
the basis of the respective Subordinate Portion of their corresponding Loan
Groups. For federal income tax purposes, the Subordinate Net Rate Cap will be
the Calculation Rate in respect of the Class A and Class B Interests in REMIC
1.
Subordinate Portion: For any Distribution Date and for each Loan Group,
the excess of the aggregate Stated Principal Balance of such Loan Group as of
the first day of the related Due Period (after giving effect to Principal
Prepayments received in the related Prepayment Period) over the aggregate
Class Certificate Balance of the Group 1 Senior Certificates in the case of
Loan Group 1 and the aggregate Class Certificate Balance of the Group 2 Senior
Certificates in the case of Loan Group 2.
Subordinate Tax Net Rate Cap: With respect to any Distribution Date and
each Class of Subordinate Certificates, the weighted average of the Group 1
Tax Net Rate Cap for that Distribution Date and the Group 2 Tax Net Rate Cap
for that Distribution Date, weighted on the basis of the excess (if any) of
the sum of the aggregate Stated Principal Balance of the Mortgage Loans in the
related Loan Group over the outstanding Certificate Principal Balance of the
related Class A Certificates.
Subsequent Periodic Rate Cap: As to each Mortgage Loan and the related
Mortgage Note, the provision therein that limits permissible increases and
decreases in the Mortgage Rate on the each Adjustment Date after the first
Adjustment Date for that Mortgage Loan to not more than the amount set forth
therein.
Subsequent Recoveries: As to any Distribution Date and Loan Group, with
respect to a Liquidated Mortgage Loan in that Loan Group that resulted in a
Realized Loss in a prior calendar month, unexpected amounts received by the
Master Servicer (net of any related expenses
44
permitted to be reimbursed pursuant to Section 3.08) specifically related to
such Liquidated Mortgage Loan after the classification of such Mortgage Loan
as a Liquidated Mortgage Loan.
Subservicer: Any person to whom the Master Servicer has contracted for
the servicing of all or a portion of the Mortgage Loans pursuant to Section
3.02.
Substitute Mortgage Loan: A Mortgage Loan substituted by the applicable
Seller for a Deleted Mortgage Loan which must, on the date of such
substitution, as confirmed in a Request for Release, substantially in the form
of Exhibit M, (i) have a Stated Principal Balance, after deduction of the
principal portion of the Scheduled Payment due in the month of substitution,
not in excess of, and not more than 10% less than the Stated Principal Balance
of the Deleted Mortgage Loan; (ii) be accruing interest at a rate no lower
than and not more than 1% per annum higher than, that of the Deleted Mortgage
Loan; (iii) have a Loan-to-Value Ratio no higher than that of the Deleted
Mortgage Loan; (iv) have a remaining term to maturity no greater than (and not
more than one year less than that of) the Deleted Mortgage Loan; (v) have a
maximum interest rate no lower than and not more than 1% per annum higher
than, that of the Deleted Mortgage Loan; (vi) have a minimum interest
specified in its related mortgage note not more than 1% per annum higher or
lower than the minimum mortgage rate of the Deleted Mortgage Loan; (vii) have
the same mortgage index reset period and periodic rate cap as the Deleted
Mortgage Loan and a gross margin not more than 1% per annum higher or lower
than that of the Deleted Mortgage Loan; (viii) not be a Cooperative Loan
unless the Deleted Mortgage Loan was a Cooperative Loan; and (ix) comply with
each representation and warranty set forth in Section 2.03.
Substitution Adjustment Amount: The meaning ascribed to such term
pursuant to Section 2.03.
Swap Account: The separate Eligible Account created and initially
maintained by the Swap Trustee pursuant to Section 4.09.
Swap Adjustment Rate: For any Distribution Date, a fraction, the
numerator of which is the sum of (a) the Net Swap Payment payable to the Swap
Counterparty with respect to such Distribution Date times a fraction, the
numerator of which is equal to 360 and the denominator of which is equal to
the actual number of days in the related Interest Accrual Period and (b) any
Swap Termination Payment payable to the Swap Counterparty for such
Distribution Date (other than a Swap Termination Payment due to a Swap
Counterparty Trigger Event), and the denominator of which is equal to the
aggregate Stated Principal Balance of the Mortgage Loans as of the Due Date in
the prior calendar month (after giving effect to Principal Prepayments, the
principal portion of Liquidation Proceeds and any Subsequent Recoveries
received in the Prepayment Period related to that prior Due Date).
Swap Certificates: The LIBOR Certificates.
Swap Contract: With respect to the LIBOR Certificates, the transaction
evidenced by the related Confirmation (as assigned to the Swap Contract
Administrator pursuant to the Swap Contract Assignment Agreement), a form of
which is attached hereto as Exhibit Q.
45
Swap Contract Administration Agreement: The swap contract administration
agreement dated as of the Closing Date among Countrywide, the Trustee and the
Swap Contract Administrator, a form of which is attached hereto as Exhibit O.
Swap Contract Administrator: The Bank of New York, in its capacity as
swap contract administrator under the Swap Contract Administration Agreement.
Swap Contract Assignment Agreement: The Assignment Agreement dated as of
the Closing Date among Countrywide, the Swap Contract Administrator and the
Swap Counterparty, a form of which is attached hereto as Exhibit R.
Swap Counterparty: Bear Xxxxxxx Financial Products, Inc. and its
successors.
Swap Contract Termination Date: The Distribution Date in January 2009.
Swap Counterparty Trigger Event: A Swap Termination Payment that is
triggered upon (i) an "Event of Default" under the Swap Contract with respect
to which the Swap Counterparty is the sole "Defaulting Party" (as defined in
the Swap Contract) or (ii) a "Termination Event" or "Additional Termination
Event" under the Swap Contract with respect to which the Swap Counterparty is
the sole "Affected Party" (as defined in the Swap Contract).
Swap Termination Payment: The payment payable to either party under the
Swap Contract due to an early termination of the Swap Contract.
Swap Trust: The trust fund established by Section 4.09.
Swap Trustee: The Bank of New York, a New York banking corporation, not
in its individual capacity, but solely in its capacity as trustee for the
benefit of the Holders of the LIBOR Certificates under this Agreement, and any
successor thereto, and any corporation or national banking association
resulting from or surviving any consolidation or merger to which it or its
successors may be a party and any successor trustee as may from time to time
be serving as successor trustee hereunder.
Tax Matters Person: The person designated as "tax matters person" in the
manner provided under Treasury regulation ss. 1.860F-4(d) and Treasury
regulation ss. 301.6231(a)(7)1T. Initially, the Tax Matters Person shall be
the Trustee.
Tax Matters Person Certificate: The Class A-R Certificate with a
Denomination of $0.01.
Terminator: As defined in Section 9.01.
Transaction Documents: This Agreement, the Swap Contract, the Swap
Administration Agreement and any other document or agreement entered into in
connection with the Trust Fund, the Certificates or the Mortgage Loans.
Transfer: Any direct or indirect transfer or sale of any Ownership
Interest in a Residual Certificate.
46
Trigger Event: With respect to a Distribution Date on or after the
Stepdown Date, either a Delinquency Trigger Event or a Cumulative Loss Trigger
Event is in effect with respect to that Distribution Date.
Trust Fund: The corpus of the trust created under this Agreement
consisting of (i) the Mortgage Loans and all interest and principal received
on or with respect thereto after the Cut-off Date to the extent not applied in
computing the Cut-off Date Principal Balance of the Mortgage Loans; (ii) the
Certificate Account, the Distribution Account and the Carryover Reserve Fund
and all amounts deposited therein pursuant to the applicable provisions of
this Agreement; (iii) property that secured a Mortgage Loan and has been
acquired by foreclosure, deed-in-lieu of foreclosure or otherwise; and (iv)
all proceeds of the conversion, voluntary or involuntary, of any of the
foregoing.
Trustee: The Bank of New York and its successors and, if a successor
trustee is appointed under this Agreement, such successor.
Trustee Advance Rate: With respect to any Advance made by the Trustee
pursuant to Section 4.01(b), a per annum rate of interest determined as of the
date of such Advance equal to the Prime Rate in effect on such date plus
5.00%.
Trustee Fee: As to any Distribution Date, an amount equal to one-twelfth
of the Trustee Fee Rate multiplied by the Pool Stated Principal Balance with
respect to such Distribution Date.
Trustee Fee Rate: With respect to each Mortgage Loan, 0.009% per annum.
Underwriters: As specified in the Preliminary Statement.
Underwriter's Exemption: Prohibited Transaction Exemption 2002-41, 67
Fed. Reg. 54487 (2002), as amended (or any successor thereto), or any
substantially similar administrative exemption granted by the U.S. Department
of Labor.
Unpaid Realized Loss Amount: For any Class of LIBOR Certificates, (x)
the portion of the aggregate Applied Realized Loss Amount previously allocated
to that Class remaining unpaid from prior Distribution Dates minus (y) any
increase in the Class Certificate Balance of that Class of Subsequent
Recoveries to the Class Certificate Balance of that Class pursuant to Section
4.02(h).
Voting Rights: The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. As of any date of
determination, (a) 1% of all Voting Rights shall be allocated to each Class of
Notional Amount Certificates, if any (such Voting Rights to be allocated among
the holders of Certificates of each such Class in accordance with their
respective Percentage Interests), (b) 1% of all Voting Rights shall be
allocated to each of the Class A-R, Class C and Class P Certificates, and (c)
the remaining Voting Rights (or 100% of the Voting Rights if there is no Class
of Notional Amount Certificates) shall be allocated among Holders of the
remaining Classes of Certificates in proportion to the Certificate Balances of
their respective Certificates on such date.
47
Weighted Average Mortgage Rate: As to any Distribution Date, the average
of the Mortgage Rate of each Mortgage Loan, weighted on the basis of its
Stated Principal Balance as of the end of the Prepayment Period related to the
immediately preceding Distribution Date.
48
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
SECTION 2.01. Conveyance of Mortgage Loans
(a) Each Seller, concurrently with the execution and delivery of this
Agreement, hereby sells, transfers, assigns, sets over and otherwise conveys
to the Depositor, without recourse, all its respective right, title and
interest in and to the related Mortgage Loans, including all interest and
principal received or receivable by such Seller, on or with respect to the
applicable Mortgage Loans after the Cut-off Date and all interest and
principal payments on the related Mortgage Loans received prior to the Cut-off
Date in respect of installments of interest and principal due thereafter, but
not including payments of principal and interest due and payable on such
Mortgage Loans on or before the Cut-off Date. On or prior to the Closing Date,
Countrywide shall deliver to the Depositor or, at the Depositor's direction,
to the Trustee or other designee of the Depositor, the Mortgage File for each
Mortgage Loan listed in the Mortgage Loan Schedule (except that, in the case
of the Delay Delivery Mortgage Loans (which may include Countrywide Mortgage
Loans, Park Granada Mortgage Loans, Park Monaco Mortgage Loans or Park Sienna
Mortgage Loans), such delivery may take place within thirty (30) days
following the Closing Date). Such delivery of the Mortgage Files shall be made
against payment by the Depositor of the purchase price, previously agreed to
by the Sellers and Depositor, for the Mortgage Loans. With respect to any
Mortgage Loan that does not have a first payment date on or before the Due
Date in the month of the first applicable Distribution Date, Countrywide shall
deposit into the Distribution Account on or before the Distribution Account
Deposit Date relating to the first Distribution Date, an amount equal to one
month's interest at the related Adjusted Mortgage Rate on the Cut-off Date
Principal Balance of such Mortgage Loan. On the Closing Date, Countrywide, as
Seller, shall deposit $7,938.19 into the Distribution Account, $7,460.58 of
which shall be allocated to Loan Group 1 and $477.61 of which shall be
allocated to Loan Group 2.
(b) Immediately upon the conveyance of the Mortgage Loans referred to in
clause (a), the Depositor sells, transfers, assigns, sets over and otherwise
conveys to the Trustee for the benefit of the Certificateholders, without
recourse, all the right, title and interest of the Depositor in and to the
Trust Fund together with the Depositor's right to require each Seller to cure
any breach of a representation or warranty made in this Agreement by such
Seller or to repurchase or substitute for any affected Mortgage Loan in
accordance herewith.
(c) In connection with the transfer and assignment set forth in clause
(b) above, the Depositor has delivered or caused to be delivered to the
Trustee (or, in the case of the Delay Delivery Mortgage Loans, will deliver or
cause to be delivered to the Trustee within thirty (30) days following the
Closing Date) for the benefit of the Certificateholders the following
documents or instruments with respect to each Mortgage Loan so assigned:
(i) (A) the original Mortgage Note endorsed by manual or
facsimile signature in blank in the following form: "Pay to the
order of ____________ without recourse," with all intervening
endorsements showing a complete chain of endorsement from the
originator to the Person endorsing the Mortgage Note (each such
endorsement being sufficient to transfer all right, title and
interest of the
49
party so endorsing, as noteholder or assignee thereof, in and to
that Mortgage Note); or
(B) with respect to any Lost Mortgage Note, a lost note
affidavit from Countrywide stating that the original Mortgage Note
was lost or destroyed, together with a copy of such Mortgage Note;
(ii) except as provided below and for each Mortgage Loan
that is not a MERS Mortgage Loan, the original recorded Mortgage
or a copy of such Mortgage, with recording information, (or, in
the case of a Mortgage for which the related Mortgaged Property is
located in the Commonwealth of Puerto Rico, a true copy of the
Mortgage certified as such by the applicable notary) and in the
case of each MERS Mortgage Loan, the original Mortgage or a copy
of such mortgage, with recording information, noting the presence
of the MIN of the Mortgage Loans and either language indicating
that the Mortgage Loan is a MOM Loan if the Mortgage Loan is a MOM
Loan or if the Mortgage Loan was not a MOM Loan at origination,
the original Mortgage and the assignment thereof to MERS, with
evidence of recording indicated thereon, or a copy of the Mortgage
certified by the public recording office in which such Mortgage
has been recorded;
(iii) in the case of each Mortgage Loan that is not a MERS
Mortgage Loan, a duly executed assignment of the Mortgage or a
copy of such assignment, with recording information, (which may be
included in a blanket assignment or assignments), together with,
except as provided below, all interim recorded assignments of such
mortgage or a copy of such assignment, with recording information,
(each such assignment, when duly and validly completed, to be in
recordable form and sufficient to effect the assignment of and
transfer to the assignee thereof, under the Mortgage to which the
assignment relates); provided that, if the related Mortgage has
not been returned from the applicable public recording office,
such assignment of the Mortgage may exclude the information to be
provided by the recording office; provided, further, that such
assignment of Mortgage need not be delivered in the case of a
Mortgage for which the related Mortgaged Property is located in
the Commonwealth of Puerto Rico;
(iv) the original or copies of each assumption,
modification, written assurance or substitution agreement, if any;
(v) except as provided below, the original or a copy of
lender's title policy or a printout of the electronic equivalent
and all riders thereto; and
(vi) in the case of a Cooperative Loan, the originals of the
following documents or instruments:
(A) The Coop Shares, together with a stock power in
blank;
(B) The executed Security Agreement;
(C) The executed Proprietary Lease;
50
(D) The executed Recognition Agreement;
(E) The executed UCC-1 financing statement with
evidence of recording thereon which have been filed in all
places required to perfect the applicable Seller's interest
in the Coop Shares and the Proprietary Lease; and
(F) The executed UCC-3 financing statements or other
appropriate UCC financing statements required by state law,
evidencing a complete and unbroken line from the mortgagee
to the Trustee with evidence of recording thereon (or in a
form suitable for recordation).
In addition, in connection with the assignment of any MERS Mortgage
Loan, each Seller agrees that it will cause, at the Trustee's expense, the
MERS(R) System to indicate that the Mortgage Loans sold by such Seller to the
Depositor have been assigned by that Seller to the Trustee in accordance with
this Agreement for the benefit of the Certificateholders by including (or
deleting, in the case of Mortgage Loans which are repurchased in accordance
with this Agreement) in such computer files the information required by the
MERS(R) System to identify the series of the Certificates issued in connection
with such Mortgage Loans. Each Seller further agrees that it will not, and
will not permit the Master Servicer to, and the Master Servicer agrees that it
will not, alter the information referenced in this paragraph with respect to
any Mortgage Loan sold by such Seller to the Depositor during the term of this
Agreement unless and until such Mortgage Loan is repurchased in accordance
with the terms of this Agreement.
In the event that in connection with any Mortgage Loan that is not a
MERS Mortgage Loan the Depositor cannot deliver (a) the original recorded
Mortgage or a copy of such mortgage, with recording information, or (b) all
interim recorded assignments or a copy of such assignments, with recording
information, or (c) the lender's title policy or a copy of lender's title
policy (together with all riders thereto) satisfying the requirements of
clause (ii), (iii) or (v) above, respectively, concurrently with the execution
and delivery of this Agreement because such document or documents have not
been returned from the applicable public recording office in the case of
clause (ii) or (iii) above, or because the title policy has not been delivered
to either the Master Servicer or the Depositor by the applicable title insurer
in the case of clause (v) above, the Depositor shall promptly deliver to the
Trustee, in the case of clause (ii) or (iii) above, such original Mortgage or
a copy of such mortgage, with recording information, or such interim
assignment or a copy of such assignments, with recording information, as the
case may be, with evidence of recording indicated thereon upon receipt thereof
from the public recording office, or a copy thereof, certified, if
appropriate, by the relevant recording office, but in no event shall any such
delivery of the original Mortgage and each such interim assignment or a copy
thereof, certified, if appropriate, by the relevant recording office, be made
later than one year following the Closing Date, or, in the case of clause (v)
above, no later than 120 days following the Closing Date; provided, however,
in the event the Depositor is unable to deliver by such date each Mortgage and
each such interim assignment by reason of the fact that any such documents
have not been returned by the appropriate recording office, or, in the case of
each such interim assignment, because the related Mortgage has not been
returned by the appropriate recording office, the Depositor shall deliver such
documents to the Trustee as promptly as possible upon receipt thereof and, in
any event, within 720 days following the Closing Date. The Depositor shall
forward or cause to be forwarded to the Trustee (a) from time to time
additional original
51
documents evidencing an assumption or modification of a Mortgage Loan and (b)
any other documents required to be delivered by the Depositor or the Master
Servicer to the Trustee. In the event that the original Mortgage is not
delivered and in connection with the payment in full of the related Mortgage
Loan and the public recording office requires the presentation of a "lost
instruments affidavit and indemnity" or any equivalent document, because only
a copy of the Mortgage can be delivered with the instrument of satisfaction or
reconveyance, the Master Servicer shall execute and deliver or cause to be
executed and delivered such a document to the public recording office. In the
case where a public recording office retains the original recorded Mortgage or
in the case where a Mortgage is lost after recordation in a public recording
office, Countrywide shall deliver to the Trustee a copy of such Mortgage
certified by such public recording office to be a true and complete copy of
the original recorded Mortgage.
As promptly as practicable subsequent to such transfer and assignment,
and in any event, within thirty (30) days thereafter, the Trustee shall (i) as
the assignee thereof, affix the following language to each assignment of
Mortgage: "CWALT, Inc., Series 2006-OC1, The Bank of New York, as trustee",
(ii) cause such assignment to be in proper form for recording in the
appropriate public office for real property records and (iii) cause to be
delivered for recording in the appropriate public office for real property
records the assignments of the Mortgages to the Trustee, except that, with
respect to any assignments of Mortgage as to which the Trustee has not
received the information required to prepare such assignment in recordable
form, the Trustee's obligation to do so and to deliver the same for such
recording shall be as soon as practicable after receipt of such information
and in any event within thirty (30) days after receipt thereof and that the
Trustee need not cause to be recorded any assignment which relates to a
Mortgage Loan (a) the Mortgaged Property and Mortgage File relating to which
are located in California or (b) in any other jurisdiction (including Puerto
Rico) under the laws of which in the opinion of counsel the recordation of
such assignment is not necessary to protect the Trustee's and the
Certificateholders' interest in the related Mortgage Loan.
In the case of Mortgage Loans that have been prepaid in full as of the
Closing Date, the Depositor, in lieu of delivering the above documents to the
Trustee, will deposit in the Certificate Account the portion of such payment
that is required to be deposited in the Certificate Account pursuant to
Section 3.05.
Notwithstanding anything to the contrary in this Agreement, within
thirty (30) days after the Closing Date with respect to the Mortgage Loans,
Countrywide (on its own behalf and on behalf of Park Granada, Park Monaco and
Park Sienna) shall either (i) deliver to the Depositor, or at the Depositor's
direction, to the Trustee or other designee of the Depositor the Mortgage File
as required pursuant to this Section 2.01 for each Delay Delivery Mortgage
Loan or (ii) either (A) substitute a Substitute Mortgage Loan for the Delay
Delivery Mortgage Loan or (B) repurchase the Delay Delivery Mortgage Loan,
which substitution or repurchase shall be accomplished in the manner and
subject to the conditions set forth in Section 2.03 (treating each Delay
Delivery Mortgage Loan as a Deleted Mortgage Loan for purposes of such Section
2.03); provided, however, that if Countrywide fails to deliver a Mortgage File
for any Delay Delivery Mortgage Loan within the thirty (30)-day period
provided in the prior sentence, Countrywide (on its own behalf and on behalf
of Park Granada, Park Monaco and Park Sienna) shall use its best reasonable
efforts to effect a substitution, rather than a repurchase of, such Deleted
Mortgage Loan and provided further that the cure period provided for in
Section 2.02 or in Section 2.03 shall not apply to the initial delivery of the
Mortgage File for such Delay Delivery Mortgage
52
Loan, but rather Countrywide (on its own behalf and on behalf of Park Granada,
Park Monaco and Park Sienna) shall have five (5) Business Days to cure such
failure to deliver. At the end of such thirty (30)-day period the Trustee
shall send a Delay Delivery Certification for the Delay Delivery Mortgage
Loans delivered during such thirty (30)-day period in accordance with the
provisions of Section 2.02.
(d) Neither the Depositor nor the Trust will acquire or hold any
Mortgage Loan that would violate the representations made by Countrywide set
forth in clause (49) of Schedule III-A hereto.
SECTION 2.02. Acceptance by Trustee of the Mortgage Loans.
(a) The Trustee acknowledges receipt of the documents identified in the
Initial Certification in the form annexed hereto as Exhibit F (an "Initial
Certification") and declares that it holds and will hold such documents and
the other documents delivered to it constituting the Mortgage Files, and that
it holds or will hold such other assets as are included in the Trust Fund, in
trust for the exclusive use and benefit of all present and future
Certificateholders. The Trustee acknowledges that it will maintain possession
of the Mortgage Notes in the State of California, unless otherwise permitted
by the Rating Agencies.
The Trustee agrees to execute and deliver on the Closing Date to the
Depositor, the Master Servicer and Countrywide (on its own behalf and on
behalf of Park Granada, Park Monaco and Park Sienna) an Initial Certification
in the form annexed to this Agreement as Exhibit F. Based on its review and
examination, and only as to the documents identified in such Initial
Certification, the Trustee acknowledges that such documents appear regular on
their face and relate to the Mortgage Loans. The Trustee shall be under no
duty or obligation to inspect, review or examine said documents, instruments,
certificates or other papers to determine that the same are genuine,
enforceable or appropriate for the represented purpose or that they have
actually been recorded in the real estate records or that they are other than
what they purport to be on their face.
On or about the thirtieth (30th) day after the Closing Date, the Trustee
shall deliver to the Depositor, the Master Servicer and Countrywide (on its
own behalf and on behalf of Park Granada, Park Monaco and Park Sienna) a Delay
Delivery Certification with respect to the Mortgage Loans in the form annexed
hereto as Exhibit G (a "Delay Delivery Certification"), with any applicable
exceptions noted thereon.
Not later than 90 days after the Closing Date, the Trustee shall deliver
to the Depositor, the Master Servicer and Countrywide (on its own behalf and
on behalf of Park Granada, Park Monaco and Park Sienna) a Final Certification
with respect to the Mortgage Loans in the form annexed hereto as Exhibit H (a
"Final Certification"), with any applicable exceptions noted thereon.
If, in the course of such review, the Trustee finds any document
constituting a part of a Mortgage File that does not meet the requirements of
Section 2.01, the Trustee shall list such as an exception in the Final
Certification; provided, however that the Trustee shall not make any
determination as to whether (i) any endorsement is sufficient to transfer all
right, title and interest of the party so endorsing, as noteholder or assignee
thereof, in and to that Mortgage Note or
53
(ii) any assignment is in recordable form or is sufficient to effect the
assignment of and transfer to the assignee thereof under the mortgage to which
the assignment relates. Countrywide (on its own behalf and on behalf of Park
Granada, Park Monaco and Park Sienna) shall promptly correct or cure such
defect within 90 days from the date it was so notified of such defect and, if
Countrywide does not correct or cure such defect within such period,
Countrywide (on its own behalf and on behalf of Park Granada, Park Monaco and
Park Sienna) shall either (a) substitute for the related Mortgage Loan a
Substitute Mortgage Loan, which substitution shall be accomplished in the
manner and subject to the conditions set forth in Section 2.03, or (b)
purchase such Mortgage Loan from the Trustee within 90 days from the date
Countrywide (on its own behalf and on behalf of Park Granada, Park Monaco and
Park Sienna) was notified of such defect in writing at the Purchase Price of
such Mortgage Loan; provided, however, that in no event shall such
substitution or purchase occur more than 540 days from the Closing Date,
except that if the substitution or purchase of a Mortgage Loan pursuant to
this provision is required by reason of a delay in delivery of any documents
by the appropriate recording office, and there is a dispute between either the
Master Servicer or Countrywide (on its own behalf and on behalf of Park
Granada, Park Monaco and Park Sienna) and the Trustee over the location or
status of the recorded document, then such substitution or purchase shall
occur within 720 days from the Closing Date. The Trustee shall deliver written
notice to each Rating Agency within 270 days from the Closing Date indicating
each Mortgage Loan (a) that has not been returned by the appropriate recording
office or (b) as to which there is a dispute as to location or status of such
Mortgage Loan. Such notice shall be delivered every 90 days thereafter until
the related Mortgage Loan is returned to the Trustee. Any such substitution
pursuant to (a) above or purchase pursuant to (b) above shall not be effected
prior to the delivery to the Trustee of the Opinion of Counsel required by
Section 2.05, if any, and any substitution pursuant to (a) above shall not be
effected prior to the additional delivery to the Trustee of a Request for
Release substantially in the form of Exhibit N. No substitution is permitted
to be made in any calendar month after the Determination Date for such month.
The Purchase Price for any such Mortgage Loan shall be deposited by
Countrywide (on its own behalf and on behalf of Park Granada, Park Monaco and
Park Sienna) in the Certificate Account on or prior to the Distribution
Account Deposit Date for the Distribution Date in the month following the
month of repurchase and, upon receipt of such deposit and certification with
respect thereto in the form of Exhibit N hereto, the Trustee shall release the
related Mortgage File to Countrywide (on its own behalf and on behalf of Park
Granada, Park Monaco and Park Sienna) and shall execute and deliver at
Countrywide's (on its own behalf and on behalf of Park Granada, Park Monaco
and Park Sienna) request such instruments of transfer or assignment prepared
by Countrywide, in each case without recourse, as shall be necessary to vest
in Countrywide (on its own behalf and on behalf of Park Granada, Park Monaco
and Park Sienna), or its designee, the Trustee's interest in any Mortgage Loan
released pursuant hereto. If pursuant to the foregoing provisions Countrywide
(on its own behalf and on behalf of Park Granada, Park Monaco and Park Sienna)
repurchases a Mortgage Loan that is a MERS Mortgage Loan, the Master Servicer
shall either (i) cause MERS to execute and deliver an assignment of the
Mortgage in recordable form to transfer the Mortgage from MERS to Countrywide
(on its own behalf and on behalf of Park Granada, Park Monaco and Park Sienna)
or its designee and shall cause such Mortgage to be removed from registration
on the MERS(R) System in accordance with MERS' rules and regulations or (ii)
cause MERS to designate on the MERS(R) System Countrywide (on its own behalf
and on behalf of Park Granada, Park Monaco and Park Sienna) or its designee as
the beneficial holder of such Mortgage Loan.
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(b) [Reserved].
(c) [Reserved].
(d) The Trustee shall retain possession and custody of each Mortgage
File in accordance with and subject to the terms and conditions set forth in
this Agreement. The Master Servicer shall promptly deliver to the Trustee,
upon the execution or receipt thereof, the originals of such other documents
or instruments constituting the Mortgage File as come into the possession of
the Master Servicer from time to time.
(e) It is understood and agreed that the respective obligations of each
Seller to substitute for or to purchase any Mortgage Loan sold to the
Depositor by it which does not meet the requirements of Section 2.01 above
shall constitute the sole remedy respecting such defect available to the
Trustee, the Depositor and any Certificateholder against that Seller.
SECTION 2.03. Representations, Warranties and Covenants of the Sellers
and Master Servicer.
(a) Countrywide hereby makes the representations and warranties set
forth in (i) Schedule II-A, Schedule II-B, Schedule II-C and Schedule II-D
hereto, and by this reference incorporated herein, to the Depositor, the
Master Servicer and the Trustee, as of the Closing Date, (ii) Schedule III-A
hereto, and by this reference incorporated herein, to the Depositor, the
Master Servicer and the Trustee, as of the Closing Date, or if so specified
therein, as of the Cut-off Date with respect to the Mortgage Loans, and (iii)
Schedule III-B hereto, and by this reference incorporated herein, to the
Depositor, the Master Servicer and the Trustee, as of the Closing Date, or if
so specified therein, as of the Cut-off Date with respect to the Mortgage
Loans that are Countrywide Mortgage Loans. Park Granada hereby makes the
representations and warranties set forth in (i) Schedule II-B hereto, and by
this reference incorporated herein, to the Depositor, the Master Servicer and
the Trustee, as of the Closing Date and (ii) Schedule III-C hereto, and by
this reference incorporated herein, to the Depositor, the Master Servicer and
the Trustee, as of the Closing Date, or if so specified therein, as of the
Cut-off Date with respect to the Mortgage Loans that are Park Granada Mortgage
Loans. Park Monaco hereby makes the representations and warranties set forth
in (i) Schedule II-C hereto, and by this reference incorporated herein, to the
Depositor, the Master Servicer and the Trustee, as of the Closing Date and
(ii) Schedule III-D hereto, and by this reference incorporated herein, to the
Depositor, the Master Servicer and the Trustee, as of the Closing Date, or if
so specified therein, as of the Cut-off Date with respect to the Mortgage
Loans that are Park Monaco Mortgage Loans. Park Sienna hereby makes the
representations and warranties set forth in (i) Schedule II-D hereto, and by
this reference incorporated herein, to the Depositor, the Master Servicer and
the Trustee, as of the Closing Date and (ii) Schedule III-E hereto, and by
this reference incorporated herein, to the Depositor, the Master Servicer and
the Trustee, as of the Closing Date, or if so specified therein, as of the
Cut-off Date with respect to the Mortgage Loans that are Park Sienna Mortgage
Loans.
(b) The Master Servicer hereby makes the representations and warranties
set forth in Schedule IV hereto, and by this reference incorporated herein, to
the Depositor and the Trustee, as of the Closing Date.
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(c) Upon discovery by any of the parties hereto of a breach of a
representation or warranty with respect to a Mortgage Loan made pursuant to
Section 2.03(a) that materially and adversely affects the interests of the
Certificateholders in that Mortgage Loan, the party discovering such breach
shall give prompt notice thereof to the other parties, the NIM Insurer and the
Swap Counterparty. Each Seller hereby covenants that within 90 days of the
earlier of its discovery or its receipt of written notice from any party of a
breach of any representation or warranty with respect to a Mortgage Loan sold
by it pursuant to Section 2.03(a) that materially and adversely affects the
interests of the Certificateholders in that Mortgage Loan, it shall cure such
breach in all material respects, and if such breach is not so cured, shall,
(i) if such 90-day period expires prior to the second anniversary of the
Closing Date, remove such Mortgage Loan (a "Deleted Mortgage Loan") from the
Trust Fund and substitute in its place a Substitute Mortgage Loan, in the
manner and subject to the conditions set forth in this Section; or (ii)
repurchase the affected Mortgage Loan or Mortgage Loans from the Trustee at
the Purchase Price in the manner set forth below; provided, however, that any
such substitution pursuant to (i) above shall not be effected prior to the
delivery to the Trustee of the Opinion of Counsel required by Section 2.05, if
any, and any such substitution pursuant to (i) above shall not be effected
prior to the additional delivery to the Trustee of a Request for Release
substantially in the form of Exhibit N and the Mortgage File for any such
Substitute Mortgage Loan. The Seller repurchasing a Mortgage Loan pursuant to
this Section 2.03(c) shall promptly reimburse the Master Servicer and the
Trustee for any expenses reasonably incurred by the Master Servicer or the
Trustee in respect of enforcing the remedies for such breach. With respect to
the representations and warranties described in this Section which are made to
the best of a Seller's knowledge, if it is discovered by either the Depositor,
a Seller or the Trustee that the substance of such representation and warranty
is inaccurate and such inaccuracy materially and adversely affects the value
of the related Mortgage Loan or the interests of the Certificateholders
therein, notwithstanding that Seller's lack of knowledge with respect to the
substance of such representation or warranty, such inaccuracy shall be deemed
a breach of the applicable representation or warranty. Any breach of a
representation set forth in clauses (46), (47), (48), (49), (50), (51), (52),
(53), (54), (55) or (56) of Schedule III-A with respect to a Mortgage Loan in
Loan Group 1 or Loan Group 2 shall be deemed to materially and adversely
affect the Certificateholders.
With respect to any Substitute Mortgage Loan or Loans sold to the
Depositor by a Seller, Countrywide (on its own behalf and on behalf of Park
Granada, Park Monaco and Park Sienna) shall deliver to the Trustee for the
benefit of the Certificateholders the Mortgage Note, the Mortgage, the related
assignment of the Mortgage, and such other documents and agreements as are
required by Section 2.01, with the Mortgage Note endorsed and the Mortgage
assigned as required by Section 2.01. No substitution is permitted to be made
in any calendar month after the Determination Date for such month. Scheduled
Payments due with respect to Substitute Mortgage Loans in the month of
substitution shall not be part of the Trust Fund and will be retained by the
related Seller on the next succeeding Distribution Date. For the month of
substitution, distributions to Certificateholders will include the monthly
payment due on any Deleted Mortgage Loan for such month and thereafter that
Seller shall be entitled to retain all amounts received in respect of such
Deleted Mortgage Loan. The Master Servicer shall amend the Mortgage Loan
Schedule for the benefit of the Certificateholders to reflect the removal of
such Deleted Mortgage Loan and the substitution of the Substitute Mortgage
Loan or Loans and the Master Servicer shall deliver the amended Mortgage Loan
Schedule to the Trustee. Upon
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such substitution, the Substitute Mortgage Loan or Loans shall be subject to
the terms of this Agreement in all respects, and the related Seller shall be
deemed to have made with respect to such Substitute Mortgage Loan or Loans, as
of the date of substitution, the representations and warranties made pursuant
to Section 2.03(a) with respect to such Mortgage Loan. Upon any such
substitution and the deposit to the Certificate Account of the amount required
to be deposited therein in connection with such substitution as described in
the following paragraph, the Trustee shall release the Mortgage File held for
the benefit of the Certificateholders relating to such Deleted Mortgage Loan
to the related Seller and shall execute and deliver at such Seller's direction
such instruments of transfer or assignment prepared by Countrywide (on its own
behalf and on behalf of Park Granada, Park Monaco and Park Sienna), in each
case without recourse, as shall be necessary to vest title in that Seller, or
its designee, the Trustee's interest in any Deleted Mortgage Loan substituted
for pursuant to this Section 2.03.
For any month in which a Seller substitutes one or more Substitute
Mortgage Loans for one or more Deleted Mortgage Loans, the Master Servicer
will determine the amount (if any) by which the aggregate principal balance of
all Substitute Mortgage Loans sold to the Depositor by that Seller as of the
date of substitution is less than the aggregate Stated Principal Balance of
all Deleted Mortgage Loans repurchased by that Seller (after application of
the scheduled principal portion of the monthly payments due in the month of
substitution). The amount of such shortage (the "Substitution Adjustment
Amount") plus an amount equal to the aggregate of any unreimbursed Advances
with respect to such Deleted Mortgage Loans shall be deposited in the
Certificate Account by Countrywide (on its own behalf and on behalf of Park
Granada, Park Monaco and Park Sienna) on or before the Distribution Account
Deposit Date for the Distribution Date in the month succeeding the calendar
month during which the related Mortgage Loan became required to be purchased
or replaced hereunder.
In the event that a Seller shall have repurchased a Mortgage Loan, the
Purchase Price therefor shall be deposited in the Certificate Account pursuant
to Section 3.05 on or before the Distribution Account Deposit Date for the
Distribution Date in the month following the month during which that Seller
became obligated hereunder to repurchase or replace such Mortgage Loan and
upon such deposit of the Purchase Price, the delivery of the Opinion of
Counsel required by Section 2.05 and receipt of a Request for Release in the
form of Exhibit N hereto, the Trustee shall release the related Mortgage File
held for the benefit of the Certificateholders to such Person, and the Trustee
shall execute and deliver at such Person's direction such instruments of
transfer or assignment prepared by such Person, in each case without recourse,
as shall be necessary to transfer title from the Trustee. It is understood and
agreed that the obligation under this Agreement of any Person to cure,
repurchase or replace any Mortgage Loan as to which a breach has occurred and
is continuing shall constitute the sole remedy against such Persons respecting
such breach available to Certificateholders, the Depositor or the Trustee on
their behalf.
The representations and warranties made pursuant to this Section 2.03
shall survive delivery of the respective Mortgage Files to the Trustee for the
benefit of the Certificateholders.
SECTION 2.04. Representations and Warranties of the Depositor as to the
Mortgage Loans.
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The Depositor hereby represents and warrants to the Trustee with respect
to each Mortgage Loan as of the date of this Agreement or such other date set
forth in this Agreement that as of the Closing Date, and following the
transfer of the Mortgage Loans to it by each Seller, the Depositor had good
title to the Mortgage Loans and the Mortgage Notes were subject to no offsets,
defenses or counterclaims.
The Depositor hereby assigns, transfers and conveys to the Trustee all
of its rights with respect to the Mortgage Loans including, without
limitation, the representations and warranties of each Seller made pursuant to
Section 2.03(a), together with all rights of the Depositor to require a Seller
to cure any breach thereof or to repurchase or substitute for any affected
Mortgage Loan in accordance with this Agreement.
It is understood and agreed that the representations and warranties set
forth in this Section 2.04 shall survive delivery of the Mortgage Files to the
Trustee. Upon discovery by the Depositor or the Trustee of a breach of any of
the foregoing representations and warranties set forth in this Section 2.04
(referred to herein as a "breach"), which breach materially and adversely
affects the interest of the Certificateholders, the party discovering such
breach shall give prompt written notice to the others and to each Rating
Agency and the NIM Insurer.
SECTION 2.05. Delivery of Opinion of Counsel in Connection with
Substitutions.
(a) Notwithstanding any contrary provision of this Agreement, no
substitution pursuant to Section 2.02 or Section 2.03 shall be made more than
90 days after the Closing Date unless Countrywide delivers to the Trustee an
Opinion of Counsel, which Opinion of Counsel shall not be at the expense of
either the Trustee or the Trust Fund, addressed to the Trustee, to the effect
that such substitution will not (i) result in the imposition of the tax on
"prohibited transactions" on the Trust Fund or contributions after the Startup
Date, as defined in Sections 860F(a)(2) and 860G(d) of the Code, respectively,
or (ii) cause any REMIC created under this Agreement to fail to qualify as a
REMIC at any time that any Certificates are outstanding.
(b) Upon discovery by the Depositor, a Seller, the Master Servicer, or
the Trustee that any Mortgage Loan does not constitute a "qualified mortgage"
within the meaning of Section 860G(a)(3) of the Code, the party discovering
such fact shall promptly (and in any event within five (5) Business Days of
discovery) give written notice thereof to the other parties and the NIM
Insurer. In connection therewith, the Trustee shall require Countrywide (on
its own behalf and on behalf of Park Granada, Park Monaco and Park Sienna) at
its option, to either (i) substitute, if the conditions in Section 2.03(c)
with respect to substitutions are satisfied, a Substitute Mortgage Loan for
the affected Mortgage Loan, or (ii) repurchase the affected Mortgage Loan
within 90 days of such discovery in the same manner as it would a Mortgage
Loan for a breach of representation or warranty made pursuant to Section 2.03.
The Trustee shall reconvey to Countrywide the Mortgage Loan to be released
pursuant to this Section in the same manner, and on the same terms and
conditions, as it would a Mortgage Loan repurchased for breach of a
representation or warranty contained in Section 2.03.
SECTION 2.06. Execution and Delivery of Certificates.
The Trustee acknowledges the transfer and assignment to it of the Trust
Fund and, concurrently with such transfer and assignment, has executed and
delivered to or upon the order
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of the Depositor, the Certificates in authorized denominations evidencing
directly or indirectly the entire ownership of the Trust Fund. The Trustee
agrees to hold the Trust Fund and exercise the rights referred to above for
the benefit of all present and future Holders of the Certificates and to
perform the duties set forth in this Agreement, to the end that the interests
of the Holders of the Certificates may be adequately and effectively
protected.
SECTION 2.07. REMIC Matters.
The Preliminary Statement sets forth the designations and "latest
possible maturity date" for federal income tax purposes of all interests
created hereby. The "Startup Day" for purposes of the REMIC Provisions shall
be the Closing Date. The "tax matters person" with respect to each REMIC
hereunder shall be the Trustee and the Trustee shall hold the Tax Matters
Person Certificate. Each REMIC's fiscal year shall be the calendar year.
SECTION 2.08. Covenants of the Master Servicer.
The Master Servicer hereby covenants to the Depositor and the Trustee as
follows:
(a) the Master Servicer shall comply in the performance of its
obligations under this Agreement with all reasonable rules and requirements of
the insurer under each Required Insurance Policy; and
(b) no written information, certificate of an officer, statement
furnished in writing or written report delivered to the Depositor, any
affiliate of the Depositor or the Trustee and prepared by the Master Servicer
pursuant to this Agreement will contain any untrue statement of a material
fact or omit to state a material fact necessary to make such information,
certificate, statement or report not misleading.
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ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
SECTION 3.01. Master Servicer to Service Mortgage Loans.
For and on behalf of the Certificateholders, the Master Servicer shall
service and administer the Mortgage Loans in accordance with the terms of this
Agreement and customary and usual standards of practice of prudent mortgage
loan servicers. In connection with such servicing and administration, the
Master Servicer shall have full power and authority, acting alone and/or
through Subservicers as provided in Section 3.02, subject to the terms of this
Agreement (i) to execute and deliver, on behalf of the Certificateholders and
the Trustee, customary consents or waivers and other instruments and
documents, (ii) to consent to transfers of any Mortgaged Property and
assumptions of the Mortgage Notes and related Mortgages (but only in the
manner provided in this Agreement), (iii) to collect any Insurance Proceeds
and other Liquidation Proceeds (which for the purpose of this Section 3.01
includes any Subsequent Recoveries), and (iv) to effectuate foreclosure or
other conversion of the ownership of the Mortgaged Property securing any
Mortgage Loan; provided that the Master Servicer shall not take any action
that is inconsistent with or prejudices the interests of the Trust Fund or the
Certificateholders in any Mortgage Loan or the rights and interests of the
Depositor, the Trustee and the Certificateholders under this Agreement. The
Master Servicer shall represent and protect the interests of the Trust Fund in
the same manner as it protects its own interests in mortgage loans in its own
portfolio in any claim, proceeding or litigation regarding a Mortgage Loan,
and shall not make or permit any modification, waiver or amendment of any
Mortgage Loan which would cause any REMIC created under this Agreement to fail
to qualify as a REMIC or result in the imposition of any tax under section
860F(a) or section 860G(d) of the Code. Without limiting the generality of the
foregoing, the Master Servicer, in its own name or in the name of the
Depositor and the Trustee, is hereby authorized and empowered by the Depositor
and the Trustee, when the Master Servicer believes it appropriate in its
reasonable judgment, to execute and deliver, on behalf of the Trustee, the
Depositor, the Certificateholders or any of them, any and all instruments of
satisfaction or cancellation, or of partial or full release or discharge and
all other comparable instruments, with respect to the Mortgage Loans, and with
respect to the Mortgaged Properties held for the benefit of the
Certificateholders. The Master Servicer shall prepare and deliver to the
Depositor and/or the Trustee such documents requiring execution and delivery
by either or both of them as are necessary or appropriate to enable the Master
Servicer to service and administer the Mortgage Loans to the extent that the
Master Servicer is not permitted to execute and deliver such documents
pursuant to the preceding sentence. Upon receipt of such documents, the
Depositor and/or the Trustee shall execute such documents and deliver them to
the Master Servicer. The Master Servicer further is authorized and empowered
by the Trustee, on behalf of the Certificateholders and the Trustee, in its
own name or in the name of the Subservicer, when the Master Servicer or the
Subservicer, as the case may be, believes it appropriate in its best judgment
to register any Mortgage Loan on the MERS(R) System, or cause the removal from
the registration of any Mortgage Loan on the MERS(R) System, to execute and
deliver, on behalf of the Trustee and the Certificateholders or any of them,
any and all instruments of assignment and other comparable instruments with
respect to such assignment or re-recording of a Mortgage in the name of MERS,
solely as nominee for the Trustee and its successors and assigns.
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In accordance with the standards of the preceding paragraph, the Master
Servicer shall advance or cause to be advanced funds as necessary for the
purpose of effecting the payment of taxes and assessments on the Mortgaged
Properties, which advances shall be reimbursable in the first instance from
related collections from the Mortgagors pursuant to Section 3.06, and further
as provided in Section 3.08. The costs incurred by the Master Servicer, if
any, in effecting the timely payments of taxes and assessments on the
Mortgaged Properties and related insurance premiums shall not, for the purpose
of calculating monthly distributions to the Certificateholders, be added to
the Stated Principal Balances of the related Mortgage Loans, notwithstanding
that the terms of such Mortgage Loans so permit.
SECTION 3.02. Subservicing; Enforcement of the Obligations of
Subservicers.
(a) The Master Servicer may arrange for the subservicing of any Mortgage
Loan by a Subservicer pursuant to a subservicing agreement; provided, however,
that such subservicing arrangement and the terms of the related subservicing
agreement must provide for the servicing of such Mortgage Loans in a manner
consistent with the servicing arrangements contemplated under this Agreement;
provided, however, that the NIM Insurer shall have consented to such
subservicing agreements (which consent shall not be unreasonably withheld).
Unless the context otherwise requires, references in this Agreement to actions
taken or to be taken by the Master Servicer in servicing the Mortgage Loans
include actions taken or to be taken by a Subservicer on behalf of the Master
Servicer. Notwithstanding the provisions of any subservicing agreement, any of
the provisions of this Agreement relating to agreements or arrangements
between the Master Servicer and a Subservicer or reference to actions taken
through a Subservicer or otherwise, the Master Servicer shall remain obligated
and liable to the Depositor, the Trustee and the Certificateholders for the
servicing and administration of the Mortgage Loans in accordance with the
provisions of this Agreement without diminution of such obligation or
liability by virtue of such subservicing agreements or arrangements or by
virtue of indemnification from the Subservicer and to the same extent and
under the same terms and conditions as if the Master Servicer alone were
servicing and administering the Mortgage Loans. All actions of each
Subservicer performed pursuant to the related subservicing agreement shall be
performed as an agent of the Master Servicer with the same force and effect as
if performed directly by the Master Servicer.
(b) For purposes of this Agreement, the Master Servicer shall be deemed
to have received any collections, recoveries or payments with respect to the
Mortgage Loans that are received by a Subservicer regardless of whether such
payments are remitted by the Subservicer to the Master Servicer.
SECTION 3.03. Rights of the Depositor, the NIM Insurer and the Trustee
in Respect of the Master Servicer.
The Depositor may, but is not obligated to, enforce the obligations of
the Master Servicer under this Agreement and may, but is not obligated to,
perform, or cause a designee to perform, any defaulted obligation of the
Master Servicer under this Agreement and in connection with any such defaulted
obligation to exercise the related rights of the Master Servicer under this
Agreement; provided that the Master Servicer shall not be relieved of any of
its obligations under this Agreement by virtue of such performance by the
Depositor or its designee. None of the Trustee, the NIM Insurer or the
Depositor shall have any responsibility or liability for any action
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or failure to act by the Master Servicer nor shall the Trustee or the
Depositor be obligated to supervise the performance of the Master Servicer
under this Agreement or otherwise.
SECTION 3.04. Trustee to Act as Master Servicer.
In the event that the Master Servicer shall for any reason no longer be
the Master Servicer under this Agreement (including by reason of an Event of
Default or termination by the Depositor), the Trustee or its successor shall
then assume all of the rights and obligations of the Master Servicer under
this Agreement arising thereafter (except that the Trustee shall not be (i)
liable for losses of the Master Servicer pursuant to Section 3.09 or any acts
or omissions of the predecessor Master Servicer under this Agreement), (ii)
obligated to make Advances if it is prohibited from doing so by applicable
law, (iii) obligated to effectuate repurchases or substitutions of Mortgage
Loans under this Agreement including, but not limited to, repurchases or
substitutions of Mortgage Loans pursuant to Section 2.02 or 2.03, (iv)
responsible for expenses of the Master Servicer pursuant to Section 2.03 or
(v) deemed to have made any representations and warranties of the Master
Servicer under this Agreement). Any such assumption shall be subject to
Section 7.02. If the Master Servicer shall for any reason no longer be the
Master Servicer (including by reason of any Event of Default or termination by
the Depositor), the Trustee or its successor shall succeed to any rights and
obligations of the Master Servicer under each subservicing agreement.
The Master Servicer shall, upon request of the Trustee, but at the
expense of the Master Servicer, deliver to the assuming party all documents
and records relating to each subservicing agreement or substitute subservicing
agreement and the Mortgage Loans then being serviced thereunder and an
accounting of amounts collected or held by it and otherwise use its best
efforts to effect the orderly and efficient transfer of the substitute
subservicing agreement to the assuming party.
SECTION 3.05. Collection of Mortgage Loan Payments; Certificate Account;
Distribution Account; Carryover Reserve Fund; Principal
Reserve Fund.
(a) The Master Servicer shall make reasonable efforts in accordance with
the customary and usual standards of practice of prudent mortgage servicers to
collect all payments called for under the terms and provisions of the Mortgage
Loans to the extent such procedures shall be consistent with this Agreement
and the terms and provisions of any related Required Insurance Policy.
Consistent with the foregoing, the Master Servicer may in its discretion (i)
waive any late payment charge or, subject to Section 3.20, any Prepayment
Charge or penalty interest in connection with the prepayment of a Mortgage
Loan and (ii) extend the due dates for payments due on a Mortgage Note for a
period not greater than 180 days; provided, however, that the Master Servicer
cannot extend the maturity of any such Mortgage Loan past the date on which
the final payment is due on the latest maturing Mortgage Loan as of the
Cut-off Date. In the event of any such arrangement, the Master Servicer shall
make Advances on the related Mortgage Loan in accordance with the provisions
of Section 4.01 during the scheduled period in accordance with the
amortization schedule of such Mortgage Loan without modification thereof by
reason of such arrangements. In addition, the NIM Insurer's prior written
consent shall be required for any waiver of Prepayment Charges or for the
extension of the due dates for payments due on a Mortgage Note, if the
aggregate number of outstanding Mortgage Loans that
62
have been granted such waivers or extensions exceeds 5% of the aggregate
number of Mortgage Loans. The Master Servicer shall not be required to
institute or join in litigation with respect to collection of any payment
(whether under a Mortgage, Mortgage Note or otherwise or against any public or
governmental authority with respect to a taking or condemnation) if it
reasonably believes that enforcing the provision of the Mortgage or other
instrument pursuant to which such payment is required is prohibited by
applicable law.
(b) The Master Servicer shall establish and maintain a Certificate
Account into which the Master Servicer shall deposit or cause to be deposited
no later than two Business Days after receipt (or, if the current long-term
credit rating of Countrywide is reduced below "A-" by S&P or "A3" by Xxxxx'x,
the Master Servicer shall deposit or cause to be deposited on a daily basis
within one Business Day of receipt), except as otherwise specifically provided
in this Agreement, the following payments and collections remitted by
Subservicers or received by it in respect of Mortgage Loans subsequent to the
Cut-off Date (other than in respect of principal and interest due on the
Mortgage Loans on or before the Cut-off Date) and the following amounts
required to be deposited under this Agreement:
(i) all payments on account of principal on the Mortgage Loans,
including Principal Prepayments;
(ii) all payments on account of interest on the Mortgage Loans,
net of the related Master Servicing Fee, Prepayment Interest Excess and
any lender paid mortgage insurance premiums;
(iii) all Insurance Proceeds, Subsequent Recoveries and
Liquidation Proceeds, other than proceeds to be applied to the
restoration or repair of a Mortgaged Property or released to the
Mortgagor in accordance with the Master Servicer's normal servicing
procedures;
(iv) any amount required to be deposited by the Master Servicer or
the Depositor in connection with any losses on Permitted Investments for
which it is responsible;
(v) any amounts required to be deposited by the Master Servicer
pursuant to Section 3.09(c) and in respect of net monthly rental income
from REO Property pursuant to Section 3.11;
(vi) all Substitution Adjustment Amounts;
(vii) all Advances made by the Master Servicer pursuant to Section
4.01;
(viii) all payments on account of Prepayment Charges on the
Mortgage Loans; and
(ix) any other amounts required to be deposited under this
Agreement.
In addition, with respect to any Mortgage Loan that is subject to a
buydown agreement, on each Due Date for such Mortgage Loan, in addition to the
monthly payment remitted by the Mortgagor, the Master Servicer shall cause
funds to be deposited into the Certificate Account in
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an amount required to cause an amount of interest to be paid with respect to
such Mortgage Loan equal to the amount of interest that has accrued on such
Mortgage Loan from the preceding Due Date at the Mortgage Rate net of the
related Master Servicing Fee.
The foregoing requirements for remittance by the Master Servicer shall
be exclusive, it being understood and agreed that, without limiting the
generality of the foregoing, payments in the nature of prepayment penalties,
late payment charges or assumption fees, if collected, need not be remitted by
the Master Servicer. In the event that the Master Servicer shall remit any
amount not required to be remitted, it may at any time withdraw or direct the
institution maintaining the Certificate Account to withdraw such amount from
the Certificate Account, any provision in this Agreement to the contrary
notwithstanding. Such withdrawal or direction may be accomplished by
delivering written notice thereof to the Trustee or such other institution
maintaining the Certificate Account which describes the amounts deposited in
error in the Certificate Account. The Master Servicer shall maintain adequate
records with respect to all withdrawals made pursuant to this Section. All
funds deposited in the Certificate Account shall be held in trust for the
Certificateholders until withdrawn in accordance with Section 3.08.
(c) The Trustee shall establish and maintain, on behalf of the
Certificateholders, a Principal Reserve Fund in the name of the Trustee. On
the Closing Date, the Depositor shall deposit into the Principal Reserve Fund
$100. Funds on deposit in the Principal Reserve Fund shall not be invested.
The Principal Reserve Fund shall be treated as an "outside reserve fund" under
applicable Treasury regulations and shall not be part of any REMIC created
under this Agreement. Amounts on deposit in the Principal Reserve Fund shall
not be invested.
(d) The Trustee shall establish and maintain, on behalf of the
Certificateholders, the Distribution Account. The Trustee shall, promptly upon
receipt, deposit in the Distribution Account and retain in the Distribution
Account the following:
(i) the aggregate amount remitted by the Master Servicer to the
Trustee pursuant to Section 3.08(a)(ix);
(ii) any amount deposited by the Master Servicer or the Depositor
pursuant to Section 3.05(e) in connection with any losses on Permitted
Investments for which it is responsible; and
(iii) any other amounts deposited hereunder which are required to
be deposited in the Distribution Account.
In the event that the Master Servicer shall remit any amount not
required to be remitted, it may at any time direct the Trustee to withdraw
such amount from the Distribution Account, any provision in this Agreement to
the contrary notwithstanding. Such direction may be accomplished by delivering
an Officer's Certificate to the Trustee which describes the amounts deposited
in error in the Distribution Account. All funds deposited in the Distribution
Account shall be held by the Trustee in trust for the Certificateholders until
disbursed in accordance with this Agreement or withdrawn in accordance with
Section 3.08. In no event shall the Trustee incur liability for withdrawals
from the Distribution Account at the direction of the Master Servicer.
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(e) Each institution at which the Certificate Account or the
Distribution Account is maintained shall invest the funds therein as directed
in writing by the Master Servicer in Permitted Investments, which shall mature
not later than (i) in the case of the Certificate Account, the second Business
Day next preceding the related Distribution Account Deposit Date (except that
if such Permitted Investment is an obligation of the institution that
maintains such account, then such Permitted Investment shall mature not later
than the Business Day next preceding such Distribution Account Deposit Date)
and (ii) in the case of the Distribution Account, the Business Day next
preceding the Distribution Date (except that if such Permitted Investment is
an obligation of the institution that maintains such fund or account, then
such Permitted Investment shall mature not later than such Distribution Date)
and, in each case, shall not be sold or disposed of prior to its maturity. All
such Permitted Investments shall be made in the name of the Trustee, for the
benefit of the Certificateholders. All income and gain net of any losses
realized from any such investment of funds on deposit in the Certificate
Account, or the Distribution Account shall be for the benefit of the Master
Servicer as servicing compensation and shall be remitted to it monthly as
provided in this Agreement. The amount of any realized losses in the
Certificate Account or the Distribution Account incurred in any such account
in respect of any such investments shall promptly be deposited by the Master
Servicer in the Certificate Account or paid to the Trustee for deposit into
the Distribution Account, as applicable. The Trustee in its fiduciary capacity
shall not be liable for the amount of any loss incurred in respect of any
investment or lack of investment of funds held in the Certificate Account or
the Distribution Account and made in accordance with this Section 3.05.
(f) The Master Servicer shall give notice to the Trustee, each Seller,
each Rating Agency and the Depositor of any proposed change of the location of
the Certificate Account prior to any change thereof. The Trustee shall give
notice to the Master Servicer, each Seller, each Rating Agency and the
Depositor of any proposed change of the location of the Distribution Account
or the Carryover Reserve Fund prior to any change thereof.
(g) On the Closing Date, the Trustee shall establish and maintain in its
name, in trust for the benefit of the Holders of the Offered Certificates, the
Carryover Reserve Fund and shall deposit $1,000 therein upon receipt from or
on behalf of the Depositor of such amount. The Carryover Reserve Fund shall be
an Eligible Account, and funds on deposit therein shall be held separate and
apart from, and shall not be commingled with, any other moneys, including
without limitation, other moneys held by the Trustee pursuant to this
Agreement.
Funds in the Carryover Reserve Fund may be invested in Permitted
Investments at the direction of the Majority of the Holders of the Class C
Certificates, which Permitted Investments shall mature not later than the
Business Day immediately preceding the first Distribution Date that follows
the date of such investment (except that if such Permitted Investment is an
obligation of the institution that maintains the Carryover Reserve Fund, then
such Permitted Investment shall mature not later than such Distribution Date)
and shall not be sold or disposed of prior to maturity. All such Permitted
Investments shall be made in the name of the Trustee, for the benefit of the
Holders of the Class C Certificates. In the absence of such written direction,
all funds in the Carryover Reserve Fund shall be invested by the Trustee in
The Bank of New York cash reserves. Any net investment earnings on such
amounts shall be retained therein until withdrawn as provided in Section 3.08.
Any losses incurred in the Carryover Reserve Fund in respect of any such
investments shall be charged against amounts on deposit in the Carryover
Reserve Fund (or such investments) immediately as realized. The Trustee shall
not be liable for
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the amount of any loss incurred in respect of any investment or lack of
investment of funds held in the Carryover Reserve Fund and made in accordance
with this Section 3.05. The Carryover Reserve Fund will not constitute an
asset of any REMIC created hereunder. The Class C Certificates shall evidence
ownership of the Carryover Reserve Fund for federal tax purposes.
SECTION 3.06. Collection of Taxes, Assessments and Similar Items; Escrow
Accounts.
(a) To the extent required by the related Mortgage Note and not
violative of current law, the Master Servicer shall establish and maintain one
or more accounts (each, an "Escrow Account") and deposit and retain therein
all collections from the Mortgagors (or advances by the Master Servicer) for
the payment of taxes, assessments, hazard insurance premiums or comparable
items for the account of the Mortgagors. Nothing in this Agreement shall
require the Master Servicer to compel a Mortgagor to establish an Escrow
Account in violation of applicable law.
(b) Withdrawals of amounts so collected from the Escrow Accounts may be
made only to effect timely payment of taxes, assessments, hazard insurance
premiums, condominium or PUD association dues, or comparable items, to
reimburse the Master Servicer out of related collections for any payments made
pursuant to Sections 3.01 (with respect to taxes and assessments and insurance
premiums) and 3.09 (with respect to hazard insurance), to refund to any
Mortgagors any sums determined to be overages, to pay interest, if required by
law or the terms of the related Mortgage or Mortgage Note, to Mortgagors on
balances in the Escrow Account or to clear and terminate the Escrow Account at
the termination of this Agreement in accordance with Section 9.01. The Escrow
Accounts shall not be a part of the Trust Fund.
(c) The Master Servicer shall advance any payments referred to in
Section 3.06(a) that are not timely paid by the Mortgagors on the date when
the tax, premium or other cost for which such payment is intended is due, but
the Master Servicer shall be required so to advance only to the extent that
such advances, in the good faith judgment of the Master Servicer, will be
recoverable by the Master Servicer out of Insurance Proceeds, Liquidation
Proceeds or otherwise.
SECTION 3.07. Access to Certain Documentation and Information Regarding
the Mortgage Loans.
The Master Servicer shall afford each Seller, the Depositor, the NIM
Insurer and the Trustee reasonable access to all records and documentation
regarding the Mortgage Loans and all accounts, insurance information and other
matters relating to this Agreement, such access being afforded without charge,
but only upon reasonable request and during normal business hours at the
office designated by the Master Servicer.
Upon reasonable advance notice in writing, the Master Servicer will
provide to each Certificateholder and/or Certificate Owner which is a savings
and loan association, bank or insurance company certain reports and reasonable
access to information and documentation regarding the Mortgage Loans
sufficient to permit such Certificateholder and/or Certificate Owner to comply
with applicable regulations of the OTS or other regulatory authorities with
respect to investment in the Certificates; provided that the Master Servicer
shall be entitled to be
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reimbursed by each such Certificateholder and/or Certificate Owner for actual
expenses incurred by the Master Servicer in providing such reports and access.
Upon request, the Master Servicer shall furnish to the Trustee and the NIM
Insurer its most recent publicly available financial statements and any other
information relating to its capacity to perform its obligations under this
Agreement reasonably requested by the NIM Insurer.
SECTION 3.08. Permitted Withdrawals from the Certificate Account, the
Distribution Account, the Carryover Reserve Fund and the
Principal Reserve Fund.
(a) The Master Servicer may from time to time make withdrawals from the
Certificate Account for the following purposes:
(i) to pay to the Master Servicer (to the extent not previously
retained by the Master Servicer) the servicing compensation to which it
is entitled pursuant to Section 3.14 and to pay to the Master Servicer,
as additional servicing compensation, earnings on or investment income
with respect to funds in or credited to the Certificate Account;
(ii) to reimburse each of the Master Servicer and the Trustee for
unreimbursed Advances made by it, such right of reimbursement pursuant
to this subclause (ii) being limited to amounts received on the Mortgage
Loan(s) in respect of which any such Advance was made;
(iii) to reimburse each of the Master Servicer and the Trustee for
any Nonrecoverable Advance previously made by it;
(iv) to reimburse the Master Servicer for Insured Expenses from
the related Insurance Proceeds;
(v) to reimburse the Master Servicer for (a) unreimbursed
Servicing Advances, the Master Servicer's right to reimbursement
pursuant to this clause (a) with respect to any Mortgage Loan being
limited to amounts received on such Mortgage Loan(s) that represent late
recoveries of the payments for which such advances were made pursuant to
Section 3.01 or Section 3.06 and (b) for unpaid Master Servicing Fees as
provided in Section 3.11;
(vi) to pay to the purchaser, with respect to each Mortgage Loan
or property acquired in respect thereof that has been purchased pursuant
to Section 2.02, 2.03 or 3.11, all amounts received on such Mortgage
Loan after the date of such purchase;
(vii) to reimburse the Sellers, the Master Servicer, the NIM
Insurer or the Depositor for expenses incurred by any of them and
reimbursable pursuant to Section 6.03;
(viii) to withdraw any amount deposited in the Certificate Account
and not required to be deposited in the Certificate Account;
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(ix) on or prior to the Distribution Account Deposit Date, to
withdraw an amount equal to the related Available Funds, Prepayment
Charges collected and the Trustee Fee for such Distribution Date and
remit such amount to the Trustee for deposit in the Distribution
Account; and
(x) to clear and terminate the Certificate Account upon
termination of this Agreement pursuant to Section 9.01.
The Master Servicer shall keep and maintain separate accounting, on a
Mortgage Loan by Mortgage Loan basis, for the purpose of justifying any
withdrawal from the Certificate Account pursuant to such subclauses (i), (ii),
(iv), (v) and (vi). Prior to making any withdrawal from the Certificate
Account pursuant to subclause (iii), the Master Servicer shall deliver to the
Trustee an Officer's Certificate of a Servicing Officer indicating the amount
of any previous Advance determined by the Master Servicer to be a
Nonrecoverable Advance and identifying the related Mortgage Loans(s), and
their respective portions of such Nonrecoverable Advance.
(b) The Trustee shall withdraw funds from the Distribution Account for
distributions to Certificateholders and remittance to the Swap Account, in the
manner specified in this Agreement (and to withhold from the amounts so
withdrawn, the amount of any taxes that it is authorized to withhold pursuant
to the last paragraph of Section 8.11). In addition, the Trustee may from time
to time make withdrawals from the Distribution Account for the following
purposes:
(i) to pay to itself the Trustee Fee for the related Distribution
Date;
(ii) to pay to the Master Servicer as additional servicing
compensation earnings on or investment income with respect to funds in
the Distribution Account;
(iii) to withdraw and return to the Master Servicer any amount
deposited in the Distribution Account and not required to be deposited
therein;
(iv) to reimburse the Trustee for any unreimbursed Advances made
by it pursuant to Section 4.01(b) hereof, such right of reimbursement
pursuant to this subclause (iv) being limited to (x) amounts received on
the related Mortgage Loan(s) in respect of which any such Advance was
made and (y) amounts not otherwise reimbursed to the Trustee pursuant to
Section 3.08(a)(ii) hereof;
(v) to reimburse the Trustee for any Nonrecoverable Advance
previously made by the Trustee pursuant to Section 4.01(b) hereof, such
right of reimbursement pursuant to this subclause (v) being limited to
amounts not otherwise reimbursed to the Trustee pursuant to Section
3.08(a)(iii) hereof; and
(vi) to clear and terminate the Distribution Account upon
termination of the Agreement pursuant to Section 9.01.
(c) The Trustee shall withdraw funds from the Carryover Reserve Fund for
distribution to the LIBOR Certificates and the Class C Certificates in the
manner specified in Section 4.02(e) (and to withhold from the amounts so
withdrawn the amount of any taxes that it
69
is authorized to retain pursuant to the last paragraph of Section 8.11). In
addition, the Trustee may from time to time make withdrawals from the
Carryover Reserve Fund for the following purposes:
(i) to withdraw any amount deposited in the Carryover Reserve Fund
and not required to be deposited therein; and
(ii) to clear and terminate the Carryover Reserve Fund upon the
termination of this Agreement pursuant to Section 9.01.
(d) On the Business Day before the Class P Principal Distribution Date,
the Trustee shall transfer $100.00 from the Principal Reserve Fund to the
Distribution Account and shall distribute such amount to the Class P
Certificates on the Class P Principal Distribution Date. Following the
distributions to be made in accordance with the preceding sentence, the
Trustee shall then terminate the Principal Reserve Fund.
SECTION 3.09. Maintenance of Hazard Insurance; Maintenance of Primary
Insurance Policies.
(a) The Master Servicer shall cause to be maintained, for each Mortgage
Loan, hazard insurance with extended coverage in an amount that is at least
equal to the lesser of (i) the maximum insurable value of the improvements
securing such Mortgage Loan or (ii) the greater of (y) the outstanding
principal balance of the Mortgage Loan and (z) an amount such that the
proceeds of such policy shall be sufficient to prevent the Mortgagor and/or
the mortgagee from becoming a co-insurer. Each such policy of standard hazard
insurance shall contain, or have an accompanying endorsement that contains, a
standard mortgagee clause. Any amounts collected by the Master Servicer under
any such policies (other than the amounts to be applied to the restoration or
repair of the related Mortgaged Property or amounts released to the Mortgagor
in accordance with the Master Servicer's normal servicing procedures) shall be
deposited in the Certificate Account. Any cost incurred by the Master Servicer
in maintaining any such insurance shall not, for the purpose of calculating
monthly distributions to the Certificateholders or remittances to the Trustee
for their benefit, be added to the principal balance of the Mortgage Loan,
notwithstanding that the terms of the Mortgage Loan so permit. Such costs
shall be recoverable by the Master Servicer out of late payments by the
related Mortgagor or out of proceeds of liquidation of the Mortgage Loan or
Subsequent Recoveries to the extent permitted by Section 3.08. It is
understood and agreed that no earthquake or other additional insurance is to
be required of any Mortgagor or maintained on property acquired in respect of
a Mortgage other than pursuant to such applicable laws and regulations as
shall at any time be in force and as shall require such additional insurance.
If the Mortgaged Property is located at the time of origination of the
Mortgage Loan in a federally designated special flood hazard area and such
area is participating in the national flood insurance program, the Master
Servicer shall cause flood insurance to be maintained with respect to such
Mortgage Loan. Such flood insurance shall be in an amount equal to the least
of (i) the outstanding principal balance of the related Mortgage Loan, (ii)
the replacement value of the improvements which are part of such Mortgaged
Property, and (iii) the maximum amount of such insurance available for the
related Mortgaged Property under the national flood insurance program.
(b) [Reserved].
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(c) The Master Servicer shall not take any action which would result in
non-coverage under any applicable Primary Insurance Policy of any loss which,
but for the actions of the Master Servicer, would have been covered
thereunder. The Master Servicer shall not cancel or refuse to renew any such
Primary Insurance Policy that is in effect at the date of the initial issuance
of the Certificates and is required to be kept in force hereunder unless the
replacement Primary Insurance Policy for such canceled or non-renewed policy
is maintained with a Qualified Insurer.
Except with respect to any Lender PMI Mortgage Loans, the Master
Servicer shall not be required to maintain any Primary Insurance Policy (i)
with respect to any Mortgage Loan with a Loan-to-Value Ratio less than or
equal to 80% as of any date of determination or, based on a new appraisal, the
principal balance of such Mortgage Loan represents 80% or less of the new
appraised value or (ii) if maintaining such Primary Insurance Policy is
prohibited by applicable law. With respect to the Lender PMI Mortgage Loans,
the Master Servicer shall maintain the Primary Insurance Policy for the life
of such Mortgage Loans, unless otherwise provided for in the related Mortgage
Note or prohibited by law.
The Master Servicer agrees to effect the timely payment of the premiums
on each Primary Insurance Policy, and such costs not otherwise recoverable
shall be recoverable by the Master Servicer from the related proceeds of
liquidation and Subsequent Recoveries.
(d) In connection with its activities as Master Servicer of the Mortgage
Loans, the Master Servicer agrees to present on behalf of itself, the Trustee
and Certificateholders, claims to the insurer under any Primary Insurance
Policies and, in this regard, to take such reasonable action as shall be
necessary to permit recovery under any Primary Insurance Policies respecting
defaulted Mortgage Loans. Any amounts collected by the Master Servicer under
any Primary Insurance Policies shall be deposited in the Certificate Account.
SECTION 3.10. Enforcement of Due-on-Sale Clauses; Assumption Agreements.
(a) Except as otherwise provided in this Section, when any property
subject to a Mortgage has been conveyed by the Mortgagor, the Master Servicer
shall to the extent that it has knowledge of such conveyance, enforce any
due-on-sale clause contained in any Mortgage Note or Mortgage, to the extent
permitted under applicable law and governmental regulations, but only to the
extent that such enforcement will not adversely affect or jeopardize coverage
under any Required Insurance Policy. Notwithstanding the foregoing, the Master
Servicer is not required to exercise such rights with respect to a Mortgage
Loan if the Person to whom the related Mortgaged Property has been conveyed or
is proposed to be conveyed satisfies the terms and conditions contained in the
Mortgage Note and Mortgage related thereto and the consent of the mortgagee
under such Mortgage Note or Mortgage is not otherwise so required under such
Mortgage Note or Mortgage as a condition to such transfer. In the event that
the Master Servicer is prohibited by law from enforcing any such due-on-sale
clause, or if coverage under any Required Insurance Policy would be adversely
affected, or if nonenforcement is otherwise permitted hereunder, the Master
Servicer is authorized, subject to Section 3.10(b), to take or enter into an
assumption and modification agreement from or with the person to whom such
property has been or is about to be conveyed, pursuant to which such person
becomes liable under the Mortgage Note and, unless prohibited by applicable
state law, the Mortgagor remains liable thereon, provided that the Mortgage
Loan shall continue to be covered (if so covered
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before the Master Servicer enters such agreement) by the applicable Required
Insurance Policies. The Master Servicer, subject to Section 3.10(b), is also
authorized with the prior approval of the insurers under any Required
Insurance Policies to enter into a substitution of liability agreement with
such Person, pursuant to which the original Mortgagor is released from
liability and such Person is substituted as Mortgagor and becomes liable under
the Mortgage Note. Notwithstanding the foregoing, the Master Servicer shall
not be deemed to be in default under this Section by reason of any transfer or
assumption which the Master Servicer reasonably believes it is restricted by
law from preventing, for any reason whatsoever.
(b) Subject to the Master Servicer's duty to enforce any due-on-sale
clause to the extent set forth in Section 3.10(a), in any case in which a
Mortgaged Property has been conveyed to a Person by a Mortgagor, and such
Person is to enter into an assumption agreement or modification agreement or
supplement to the Mortgage Note or Mortgage that requires the signature of the
Trustee, or if an instrument of release signed by the Trustee is required
releasing the Mortgagor from liability on the Mortgage Loan, the Master
Servicer shall prepare and deliver or cause to be prepared and delivered to
the Trustee for signature and shall direct, in writing, the Trustee to execute
the assumption agreement with the Person to whom the Mortgaged Property is to
be conveyed and such modification agreement or supplement to the Mortgage Note
or Mortgage or other instruments as are reasonable or necessary to carry out
the terms of the Mortgage Note or Mortgage or otherwise to comply with any
applicable laws regarding assumptions or the transfer of the Mortgaged
Property to such Person. In connection with any such assumption, no material
term of the Mortgage Note may be changed. In addition, the substitute
Mortgagor and the Mortgaged Property must be acceptable to the Master Servicer
in accordance with its underwriting standards as then in effect. Together with
each such substitution, assumption or other agreement or instrument delivered
to the Trustee for execution by it, the Master Servicer shall deliver an
Officer's Certificate signed by a Servicing Officer stating that the
requirements of this subsection have been met in connection therewith. The
Master Servicer shall notify the Trustee that any such substitution or
assumption agreement has been completed by forwarding to the Trustee the
original of such substitution or assumption agreement, which in the case of
the original shall be added to the related Mortgage File and shall, for all
purposes, be considered a part of such Mortgage File to the same extent as all
other documents and instruments constituting a part thereof. Any fee collected
by the Master Servicer for entering into an assumption or substitution of
liability agreement will be retained by the Master Servicer as additional
servicing compensation.
SECTION 3.11. Realization Upon Defaulted Mortgage Loans; Repurchase of
Certain Mortgage Loans.
(a) The Master Servicer shall use reasonable efforts to foreclose upon
or otherwise comparably convert the ownership of properties securing such of
the Mortgage Loans as come into and continue in default and as to which no
satisfactory arrangements can be made for collection of delinquent payments.
In connection with such foreclosure or other conversion, the Master Servicer
shall follow such practices and procedures as it shall deem necessary or
advisable and as shall be normal and usual in its general mortgage servicing
activities and meet the requirements of the insurer under any Required
Insurance Policy; provided, however, that the Master Servicer shall not be
required to expend its own funds in connection with any foreclosure or towards
the restoration of any property unless it shall determine (i) that such
restoration and/or foreclosure will increase the proceeds of liquidation of the
Mortgage Loan after reimbursement
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to itself of such expenses and (ii) that such expenses will be recoverable to
it through the proceeds of liquidation of the Mortgage Loan and Subsequent
Recoveries (respecting which it shall have priority for purposes of withdrawals
from the Certificate Account). The Master Servicer shall be responsible for all
other costs and expenses incurred by it in any such proceedings; provided,
however, that it shall be entitled to reimbursement thereof from the proceeds
of liquidation of the Mortgage Loan and Subsequent Recoveries with respect to
the related Mortgaged Property, as provided in the definition of Liquidation
Proceeds. If the Master Servicer has knowledge that a Mortgaged Property which
the Master Servicer is contemplating acquiring in foreclosure or by deed in
lieu of foreclosure is located within a 1 mile radius of any site listed in
the Expenditure Plan for the Hazardous Substance Clean Up Bond Act of 1984 or
other site with environmental or hazardous waste risks known to the Master
Servicer, the Master Servicer will, prior to acquiring the Mortgaged Property,
consider such risks and only take action in accordance with its established
environmental review procedures.
With respect to any REO Property, the deed or certificate of sale shall
be taken in the name of the Trustee for the benefit of the Certificateholders,
or its nominee, on behalf of the Certificateholders. The Trustee's name shall
be placed on the title to such REO Property solely as the Trustee hereunder
and not in its individual capacity. The Master Servicer shall ensure that the
title to such REO Property references the Pooling and Servicing Agreement and
the Trustee's capacity thereunder. Pursuant to its efforts to sell such REO
Property, the Master Servicer shall either itself or through an agent selected
by the Master Servicer protect and conserve such REO Property in the same
manner and to such extent as is customary in the locality where such REO
Property is located and may, incident to its conservation and protection of
the interests of the Certificateholders, rent the same, or any part thereof,
as the Master Servicer deems to be in the best interest of the
Certificateholders for the period prior to the sale of such REO Property. The
Master Servicer shall prepare for and deliver to the Trustee a statement with
respect to each REO Property that has been rented showing the aggregate rental
income received and all expenses incurred in connection with the maintenance
of such REO Property at such times as is necessary to enable the Trustee to
comply with the reporting requirements of the REMIC Provisions. The net
monthly rental income, if any, from such REO Property shall be deposited in
the Certificate Account no later than the close of business on each
Determination Date. The Master Servicer shall perform the tax reporting and
withholding required by Sections 1445 and 6050J of the Code with respect to
foreclosures and abandonments, the tax reporting required by Section 6050H of
the Code with respect to the receipt of mortgage interest from individuals and
any tax reporting required by Section 6050P of the Code with respect to the
cancellation of indebtedness by certain financial entities, by preparing such
tax and information returns as may be required, in the form required, and
delivering the same to the Trustee for filing.
In the event that the Trust Fund acquires any Mortgaged Property as
aforesaid or otherwise in connection with a default or imminent default on a
Mortgage Loan, the Master Servicer shall dispose of such Mortgaged Property as
soon as practicable in a manner that maximizes the Liquidation Proceeds
thereof, but in no event later than three years after its acquisition by the
Trust Fund. In that event, the Trustee shall have been supplied with an
Opinion of Counsel to the effect that the holding by the Trust Fund of such
Mortgaged Property subsequent to a three-year period, if applicable, will not
result in the imposition of taxes on "prohibited transactions" of any REMIC
hereunder as defined in Section 860F of the Code or cause any REMIC hereunder
to fail to qualify as a REMIC at any time that any Certificates are
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outstanding, and that the Trust Fund may continue to hold such Mortgaged
Property (subject to any conditions contained in such Opinion of Counsel)
after the expiration of such three-year period. Notwithstanding any other
provision of this Agreement, no Mortgaged Property acquired by the Trust Fund
shall be rented (or allowed to continue to be rented) or otherwise used for
the production of income by or on behalf of the Trust Fund in such a manner or
pursuant to any terms that would (i) cause such Mortgaged Property to fail to
qualify as "foreclosure property" within the meaning of Section 860G(a)(8) of
the Code or (ii) subject any REMIC hereunder to the imposition of any federal,
state or local income taxes on the income earned from such Mortgaged Property
under Section 860G(c) of the Code or otherwise, unless the Master Servicer has
agreed to indemnify and hold harmless the Trust Fund with respect to the
imposition of any such taxes.
In the event of a default on a Mortgage Loan one or more of whose
obligor is not a United States Person, as that term is defined in Section
7701(a)(30) of the Code, in connection with any foreclosure or acquisition of
a deed in lieu of foreclosure (together, "foreclosure") in respect of such
Mortgage Loan, the Master Servicer will cause compliance with the provisions
of Treasury Regulation Section 1.1445-2(d)(3) (or any successor thereto)
necessary to assure that no withholding tax obligation arises with respect to
the proceeds of such foreclosure except to the extent, if any, that proceeds
of such foreclosure are required to be remitted to the obligors on such
Mortgage Loan.
The decision of the Master Servicer to foreclose on a defaulted Mortgage
Loan shall be subject to a determination by the Master Servicer that the
proceeds of such foreclosure would exceed the costs and expenses of bringing
such a proceeding. The income earned from the management of any REO
Properties, net of reimbursement to the Master Servicer for expenses incurred
(including any property or other taxes) in connection with such management and
net of unreimbursed Master Servicing Fees, Advances and Servicing Advances,
shall be applied to the payment of principal of and interest on the related
defaulted Mortgage Loans (with interest accruing as though such Mortgage Loans
were still current) and all such income shall be deemed, for all purposes in
this Agreement, to be payments on account of principal and interest on the
related Mortgage Notes and shall be deposited into the Certificate Account. To
the extent the net income received during any calendar month is in excess of
the amount attributable to amortizing principal and accrued interest at the
related Mortgage Rate on the related Mortgage Loan for such calendar month,
such excess shall be considered to be a partial prepayment of principal of the
related Mortgage Loan.
The proceeds from any liquidation of a Mortgage Loan, as well as any
income from an REO Property, will be applied in the following order of
priority: first, to reimburse the Master Servicer for any related unreimbursed
Servicing Advances and Master Servicing Fees; second, to reimburse the Master
Servicer or the Trustee for any unreimbursed Advances; third, to reimburse the
Certificate Account for any Nonrecoverable Advances (or portions thereof) that
were previously withdrawn by the Master Servicer or the Trustee pursuant to
Section 3.08(a)(iii) that related to such Mortgage Loan; fourth, to accrued
and unpaid interest (to the extent no Advance has been made for such amount or
any such Advance has been reimbursed) on the Mortgage Loan or related REO
Property, at the Adjusted Net Mortgage Rate to the Due Date occurring in the
month in which such amounts are required to be distributed; and fifth, as a
recovery of principal of the Mortgage Loan. Excess Proceeds, if any, from the
liquidation of a Liquidated
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Mortgage Loan will be retained by the Master Servicer as additional servicing
compensation pursuant to Section 3.14.
The Master Servicer, in its sole discretion, shall have the right to
purchase for its own account from the Trust Fund any Mortgage Loan which is
151 days or more delinquent at a price equal to the Purchase Price; provided,
however, that the Master Servicer may only exercise this right on or before
the next to the last day of the calendar month in which such Mortgage Loan
became 151 days delinquent (such month, the "Eligible Repurchase Month");
provided further, that any such Mortgage Loan which becomes current but
thereafter becomes delinquent may be purchased by the Master Servicer pursuant
to this Section in any ensuing Eligible Repurchase Month. The Purchase Price
for any Mortgage Loan purchased under this Section 3.11 shall be deposited in
the Certificate Account and the Trustee, upon receipt of a certificate from
the Master Servicer in the form of Exhibit N to this Agreement, shall release
or cause to be released to the purchaser of such Mortgage Loan the related
Mortgage File and shall execute and deliver such instruments of transfer or
assignment prepared by the purchaser of such Mortgage Loan, in each case
without recourse, as shall be necessary to vest in the purchaser of such
Mortgage Loan any Mortgage Loan released pursuant hereto and the purchaser of
such Mortgage Loan shall succeed to all the Trustee's right, title and
interest in and to such Mortgage Loan and all security and documents related
thereto. Such assignment shall be an assignment outright and not for security.
The purchaser of such Mortgage Loan shall thereupon own such Mortgage Loan,
and all security and documents, free of any further obligation to the Trustee
or the Certificateholders with respect thereto.
(b) The Master Servicer may agree to a modification of any Mortgage Loan
(the "Modified Mortgage Loan") if (i) the modification is in lieu of a
refinancing and (ii) the Mortgage Rate on the Modified Mortgage Loan is
approximately a prevailing market rate for newly-originated mortgage loans
having similar terms and (iii) the Master Servicer purchases the Modified
Mortgage Loan from the Trust Fund as described below. Effective immediately
after the modification, and, in any event, on the same Business Day on which
the modification occurs, all interest of the Trustee in the Modified Mortgage
Loan shall automatically be deemed transferred and assigned to the Master
Servicer and all benefits and burdens of ownership thereof, including the
right to accrued interest thereon from the date of modification and the risk
of default thereon, shall pass to the Master Servicer. The Master Servicer
shall promptly deliver to the Trustee a certification of a Servicing Officer
to the effect that all requirements of this paragraph have been satisfied with
respect to the Modified Mortgage Loan. For federal income tax purposes, the
Trustee shall account for such purchase as a prepayment in full of the
Modified Mortgage Loan.
The Master Servicer shall deposit the Purchase Price for any Modified
Mortgage Loan in the Certificate Account pursuant to Section 3.05 within one
Business Day after the purchase of the Modified Mortgage Loan. Upon receipt by
the Trustee of written notification of any such deposit signed by a Servicing
Officer, the Trustee shall release to the Master Servicer the related Mortgage
File and shall execute and deliver such instruments of transfer or assignment,
in each case without recourse, as shall be necessary to vest in the Master
Servicer any Modified Mortgage Loan previously transferred and assigned
pursuant hereto. The Master Servicer covenants and agrees to indemnify the
Trust Fund against any liability for any "prohibited transaction" taxes and
any related interest, additions, and penalties imposed on the Trust Fund
established hereunder as a result of any modification of a Mortgage Loan
effected pursuant to
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this subsection (b), any holding of a Modified Mortgage Loan by the Trust Fund
or any purchase of a Modified Mortgage Loan by the Master Servicer (but such
obligation shall not prevent the Master Servicer or any other appropriate
Person from in good faith contesting any such tax in appropriate proceedings
and shall not prevent the Master Servicer from withholding payment of such
tax, if permitted by law, pending the outcome of such proceedings). The Master
Servicer shall have no right of reimbursement for any amount paid pursuant to
the foregoing indemnification, except to the extent that the amount of any
tax, interest, and penalties, together with interest thereon, is refunded to
the Trust Fund or the Master Servicer.
SECTION 3.12. Trustee to Cooperate; Release of Mortgage Files.
Upon the payment in full of any Mortgage Loan, or the receipt by the
Master Servicer of a notification that payment in full will be escrowed in a
manner customary for such purposes, the Master Servicer will immediately
notify the Trustee by delivering, or causing to be delivered a "Request for
Release" substantially in the form of Exhibit N of this Agreement. Upon
receipt of such request, the Trustee shall promptly release the related
Mortgage File to the Master Servicer, and the Trustee shall at the Master
Servicer's direction execute and deliver to the Master Servicer the request
for reconveyance, deed of reconveyance or release or satisfaction of mortgage
or such instrument releasing the lien of the Mortgage in each case provided by
the Master Servicer, together with the Mortgage Note with written evidence of
cancellation on the Mortgage Note. The Master Servicer is authorized to cause
the removal from the registration on the MERS(R) System of such Mortgage and
to execute and deliver, on behalf of the Trustee and the Certificateholders or
any of them, any and all instruments of satisfaction or cancellation or of
partial or full release. Expenses incurred in connection with any instrument
of satisfaction or deed of reconveyance shall be chargeable to the related
Mortgagor. From time to time and as shall be appropriate for the servicing or
foreclosure of any Mortgage Loan, including for such purpose, collection under
any policy of flood insurance, any fidelity bond or errors or omissions
policy, or for the purposes of effecting a partial release of any Mortgaged
Property from the lien of the Mortgage or the making of any corrections to the
Mortgage Note or the Mortgage or any of the other documents included in the
Mortgage File, the Trustee shall, upon delivery to the Trustee of a Request
for Release in the form of Exhibit M signed by a Servicing Officer, release
the Mortgage File to the Master Servicer. Subject to the further limitations
set forth below, the Master Servicer shall cause the Mortgage File or
documents so released to be returned to the Trustee when the need therefor by
the Master Servicer no longer exists, unless the Mortgage Loan is liquidated
and the proceeds thereof are deposited in the Certificate Account, in which
case the Master Servicer shall deliver to the Trustee a Request for Release in
the form of Exhibit N, signed by a Servicing Officer.
If the Master Servicer at any time seeks to initiate a foreclosure
proceeding in respect of any Mortgaged Property as authorized by this
Agreement, the Master Servicer shall deliver or cause to be delivered to the
Trustee, for signature, as appropriate, any court pleadings, requests for
trustee's sale or other documents necessary to effectuate such foreclosure or
any legal action brought to obtain judgment against the Mortgagor on the
Mortgage Note or the Mortgage or to obtain a deficiency judgment or to enforce
any other remedies or rights provided by the Mortgage Note or the Mortgage or
otherwise available at law or in equity.
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SECTION 3.13. Documents, Records and Funds in Possession of Master
Servicer to be Held for the Trustee.
Notwithstanding any other provisions of this Agreement, the Master
Servicer shall transmit to the Trustee as required by this Agreement all
documents and instruments in respect of a Mortgage Loan coming into the
possession of the Master Servicer from time to time and shall account fully to
the Trustee for any funds received by the Master Servicer or which otherwise
are collected by the Master Servicer as Liquidation Proceeds, Insurance
Proceeds or Subsequent Recoveries in respect of any Mortgage Loan. All
Mortgage Files and funds collected or held by, or under the control of, the
Master Servicer in respect of any Mortgage Loans, whether from the collection
of principal and interest payments or from Liquidation Proceeds and any
Subsequent Recoveries, including but not limited to, any funds on deposit in
the Certificate Account, shall be held by the Master Servicer for and on
behalf of the Trustee and shall be and remain the sole and exclusive property
of the Trustee, subject to the applicable provisions of this Agreement. The
Master Servicer also agrees that it shall not create, incur or subject any
Mortgage File or any funds that are deposited in the Certificate Account,
Distribution Account or any Escrow Account, or any funds that otherwise are or
may become due or payable to the Trustee for the benefit of the
Certificateholders, to any claim, lien, security interest, judgment, levy,
writ of attachment or other encumbrance, or assert by legal action or
otherwise any claim or right of setoff against any Mortgage File or any funds
collected on, or in connection with, a Mortgage Loan, except, however, that
the Master Servicer shall be entitled to set off against and deduct from any
such funds any amounts that are properly due and payable to the Master
Servicer under this Agreement.
SECTION 3.14. Servicing Compensation.
As compensation for its activities hereunder, the Master Servicer shall
be entitled to retain or withdraw from the Certificate Account an amount equal
to the Master Servicing Fee; provided, that the aggregate Master Servicing Fee
with respect to any Distribution Date shall be reduced (i) by an amount equal
to the aggregate of the Prepayment Interest Shortfalls, if any, with respect
to such Distribution Date, but not by more than the Compensating Interest for
that Distribution Date, and (ii) with respect to the first Distribution Date,
an amount equal to any amount to be deposited into the Distribution Account by
the Depositor pursuant to Section 2.01(a) and not so deposited.
Additional servicing compensation in the form of Excess Proceeds,
Prepayment Interest Excess, assumption fees, late payment charges and all
income and gain net of any losses realized from Permitted Investments shall be
retained by the Master Servicer to the extent not required to be deposited in
the Certificate Account pursuant to Section 3.05. The Master Servicer shall be
required to pay all expenses incurred by it in connection with its master
servicing activities hereunder (including payment of any premiums for hazard
insurance and any Primary Insurance Policy and maintenance of the other forms
of insurance coverage required by this Agreement) and shall not be entitled to
reimbursement therefor except as specifically provided in this Agreement.
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SECTION 3.15. Access to Certain Documentation.
The Master Servicer shall provide to the OTS and the FDIC and to
comparable regulatory authorities supervising Holders and/or Certificate
Owners and the examiners and supervisory agents of the OTS, the FDIC and such
other authorities, access to the documentation regarding the Mortgage Loans
required by applicable regulations of the OTS and the FDIC. Such access shall
be afforded without charge, but only upon reasonable and prior written request
and during normal business hours at the offices designated by the Master
Servicer. Nothing in this Section shall limit the obligation of the Master
Servicer to observe any applicable law prohibiting disclosure of information
regarding the Mortgagors and the failure of the Master Servicer to provide
access as provided in this Section as a result of such obligation shall not
constitute a breach of this Section.
As part of its servicing activities, the Master Servicer shall furnish
in accordance with the Fair Credit Reporting Act and its implementing
regulations, accurate and complete information (i.e., favorable or
unfavorable) on its borrower credit files related to the Mortgage Loans to the
nationally recognized credit bureaus on a monthly basis.
SECTION 3.16. Annual Statement as to Compliance.
(a) The Master Servicer shall deliver to the Depositor and the Trustee
on or before March 15 of each year, commencing with its 2007 fiscal year, an
Officer's Certificate stating, as to the signer thereof, that (i) a review of
the activities of the Master Servicer during the preceding calendar year (or
applicable portion thereof) and of the performance of the Master Servicer
under this Agreement has been made under such officer's supervision and (ii)
to the best of such officer's knowledge, based on such review, the Master
Servicer has fulfilled all its obligations under this Agreement in all
material respects throughout such year (or applicable portion thereof), or, if
there has been a failure to fulfill any such obligation in any material
respect, specifying each such failure known to such officer and the nature and
status thereof.
(b) The Master Servicer shall cause each Subservicer to deliver to the
Depositor and the Trustee on or before March 15 of each year, commencing with
its 2007 fiscal year, an Officer's Certificate stating, as to the signer
thereof, that (i) a review of the activities of such Subservicer during the
preceding calendar year (or applicable portion thereof) and of the performance
of the Subservicer under the applicable Subservicing Agreement or primary
servicing agreement, has been made under such officer's supervision and (ii)
to the best of such officer's knowledge, based on such review, such
Subservicer has fulfilled all its obligations under the applicable
Subservicing Agreement or primary servicing agreement, in all material
respects throughout such year (or applicable portion thereof), or, if there
has been a failure to fulfill any such obligation in any material respect,
specifying each such failure known to such officer and the nature and status
thereof.
(c) The Trustee shall forward a copy of each such statement to each
Rating Agency.
SECTION 3.17. Errors and Omissions Insurance; Fidelity Bonds.
The Master Servicer shall for so long as it acts as master servicer
under this Agreement, obtain and maintain in force (a) a policy or policies of
insurance covering errors and omissions in
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the performance of its obligations as Master Servicer hereunder and (b) a
fidelity bond in respect of its officers, employees and agents. Each such
policy or policies and bond shall, together, comply with the requirements from
time to time of FNMA or FHLMC for persons performing servicing for mortgage
loans purchased by FNMA or FHLMC. In the event that any such policy or bond
ceases to be in effect, the Master Servicer shall obtain a comparable
replacement policy or bond from an insurer or issuer, meeting the requirements
set forth above as of the date of such replacement.
SECTION 3.18. Notification of Adjustments.
On each Adjustment Date, the Master Servicer shall make interest rate
adjustments for each Mortgage Loan in compliance with the requirements of the
related Mortgage and Mortgage Note and applicable regulations. The Master
Servicer shall execute and deliver the notices required by each Mortgage and
Mortgage Note and applicable regulations regarding interest rate adjustments.
The Master Servicer also shall provide timely notification to the Trustee of
all applicable data and information regarding such interest rate adjustments
and the Master Servicer's methods of implementing such interest rate
adjustments. Upon the discovery by the Master Servicer or the Trustee that the
Master Servicer has failed to adjust or has incorrectly adjusted a Mortgage
Rate or a monthly payment pursuant to the terms of the related Mortgage Note
and Mortgage, the Master Servicer shall immediately deposit in the Certificate
Account from its own funds the amount of any interest loss caused thereby
without reimbursement therefor; provided, however, the Master Servicer shall
be held harmless with respect to any interest rate adjustments made by any
servicer prior to the Master Servicer.
SECTION 3.19. The Swap Contract.
Countrywide shall cause The Bank of New York to enter into the Swap
Contract Administration Agreement and shall assign all of its right, title and
interest in and to the interest rate swap transaction evidenced by the Swap
Contract to, and shall cause all of its obligations in respect of such
transaction to be assumed by, the Swap Contract Administrator, on the terms
and conditions set forth in the Swap Contract Assignment Agreement. The
Trustee's rights to receive certain proceeds of the Swap Contract as provided
in the Swap Contract Administration Agreement shall be rights of the Trustee
as Swap Trustee hereunder, shall be an asset of the Swap Trust and shall not
be an asset of the Trust Fund nor of any REMIC. The Swap Trustee shall deposit
any amounts received from time to time from the Swap Contract Administrator
with respect to the Swap Contract into the Swap Account. The Master Servicer
shall deposit any amounts received on behalf of the Swap Trustee from time to
time with respect to the Swap Contract into the Swap Account.
On the Business Day preceding each Distribution Date, the Swap Trustee
shall notify the Swap Contract Administrator of any amounts distributable to
the Swap Certificates pursuant to Section 4.02(h)(iii) through (viii) that
will remain unpaid following all distributions to be made on such Distribution
Date pursuant to Section 4.02(a) through (c).
No later than two Business Days following each Distribution Date, the
Trustee shall provide the Swap Contract Administrator with information
regarding the aggregate Class Certificate Balance of the LIBOR Certificates
after all distributions on such Distribution Date.
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Upon the Swap Contract Administrator obtaining actual knowledge of the
rating of the Swap Counterparty falling below the Approved Rating Thresholds
(as defined in the Swap Contract), the Swap Trustee shall direct the Swap
Contract Administrator to negotiate an ISDA Credit Support Annex with the Swap
Counterparty that meets the terms of the Swap Contract. If an ISDA Credit
Support Annex is negotiated, the Swap Trustee shall direct the Swap Contract
Administrator to demand payment of the Delivery Amount (as defined in the ISDA
Credit Support Annex). In addition, if an ISDA Credit Support Annex is
negotiated, the Swap Trustee shall set up an account in accordance with
Section 4.09 to hold cash or other eligible investments pledged under such
ISDA Credit Support Annex. Any cash or other eligible investments pledged
under an ISDA Credit Support Annex shall not be part of the Swap Account or
the Distribution Account unless they are applied in accordance with such ISDA
Credit Support Annex to make a payment due to the Swap Contract Administrator
pursuant to the Swap Contract.
Upon the Swap Trustee obtaining actual knowledge of an Event of Default
(as defined in the Swap Contract) or Termination Event (as defined in the Swap
Contract) for which the Swap Contract Administrator has the right to designate
an Early Termination Date (as defined in the Swap Contract), the Swap Trustee
shall act at the written direction of the Depositor as to whether to direct
the Swap Contract Administrator to designate an Early Termination Date;
provided, however, that the Swap Trustee shall provide written notice to each
Rating Agency following the Event of Default or Termination Event. Upon the
termination of the Swap Contract under the circumstances contemplated by this
Section 3.19, the Swap Trustee shall use its reasonable best efforts to
enforce the rights of the Swap Contract Administrator as may be permitted by
the terms of the Swap Contract and consistent with the terms hereof, and
Countrywide shall assist the Swap Contract Administrator in procuring a
replacement swap contract with terms approximating those of the original Swap
Contract.
In the event that the swap counterparty in respect of a replacement swap
contract pays any upfront amount to the Swap Contract Administrator in
connection with entering into the replacement swap contract, the Swap Trustee
shall notify the Swap Contract Administrator of the amount of Interest Funds
for each Loan Group and the Principal Distribution Amounts for each Loan Group
that were used on prior Distribution Dates to cover any Swap Termination
Payment due to the Swap Counterparty under the original Swap Contract, and any
portion of such upfront amount paid by a swap counterparty in respect of a
replacement swap contract that is remitted by the Swap Contract Administrator
to the Swap Trustee shall be available, to the extent and in the respective
amounts that Interest Funds for each Loan Group and Principal Distribution
Amounts for each Loan Group were used on prior Distribution Dates to cover any
Swap Termination Payments due to the Swap Counterparty under the original Swap
Contract, for distribution on each succeeding Distribution Date in the manner
described in Section 4.02(d).
Any portion of any Net Swap Payment or Swap Termination Payment payable
by the Swap Counterparty and not remitted by the Swap Contract Administrator
to the Swap Trustee with respect to any Distribution Date will be remitted to
Countrywide and will not be available to make distributions in respect of any
Class of Certificates.
The Swap Counterparty shall be an express third party beneficiary of
this Agreement for the purpose of enforcing the provisions hereof to the
extent of the Swap Counterparty's rights explicitly specified herein as if a
party hereto.
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SECTION 3.20. Prepayment Charges.
(a) Notwithstanding anything in this Agreement to the contrary, in the
event of a Principal Prepayment in full or in part of a Mortgage Loan, the
Master Servicer may not waive any Prepayment Charge or portion thereof
required by the terms of the related Mortgage Note unless (i) such Mortgage
Loan is in default or the Master Servicer believes that such a default is
imminent, and the Master Servicer determines that such waiver would maximize
recovery of Liquidation Proceeds for such Mortgage Loan, taking into account
the value of such Prepayment Charge, or (ii) (A) the enforceability thereof is
limited (1) by bankruptcy, insolvency, moratorium, receivership, or other
similar law relating to creditors' rights generally or (2) due to acceleration
in connection with a foreclosure or other involuntary payment, or (B) the
enforceability is otherwise limited or prohibited by applicable law. In the
event of a Principal Prepayment in full or in part with respect to any
Mortgage Loan, the Master Servicer shall deliver to the Trustee an Officer's
Certificate substantially in the form of Exhibit S no later than the third
Business Day following the immediately succeeding Determination Date with a
copy to the Class P Certificateholders. If the Master Servicer has waived or
does not collect all or a portion of a Prepayment Charge relating to a
Principal Prepayment in full or in part due to any action or omission of the
Master Servicer, other than as provided above, the Master Servicer shall
deliver to the Trustee, together with the Principal Prepayment in full or in
part, the amount of such Prepayment Charge (or such portion thereof as had
been waived) for deposit into the Certificate Account (not later than 1:00
p.m. Pacific time on the immediately succeeding Master Servicer Advance Date,
in the case of such Prepayment Charge) for distribution in accordance with the
terms of this Agreement.
(b) Upon discovery by the Master Servicer or a Responsible Officer of
the Trustee of a breach of the foregoing subsection (a), the party discovering
the breach shall give prompt written notice to the other parties.
(c) Countrywide represents and warrants to the Depositor and the
Trustee, as of the Closing Date, that the information in the Prepayment Charge
Schedule (including the attached prepayment charge summary) is complete and
accurate in all material respects at the dates as of which the information is
furnished and each Prepayment Charge is permissible and enforceable in
accordance with its terms under applicable state law, except as the
enforceability thereof is limited due to acceleration in connection with a
foreclosure or other involuntary payment.
(d) Upon discovery by the Master Servicer or a Responsible Officer of
the Trustee of a breach of the foregoing clause (c) that materially and
adversely affects right of the Holders of the Class P Certificates to any
Prepayment Charge, the party discovering the breach shall give prompt written
notice to the other parties. Within 60 days of the earlier of discovery by the
Master Servicer or receipt of notice by the Master Servicer of breach, the
Master Servicer shall cure the breach in all material respects or shall pay
into the Certificate Account the amount of the Prepayment Charge that would
otherwise be due from the Mortgagor, less any amount representing such
Prepayment Charge previously collected and paid by the Master Servicer into
the Certificate Account.
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ARTICLE IV
DISTRIBUTIONS AND
ADVANCES BY THE MASTER SERVICER
SECTION 4.01. Advances.
(a) The Master Servicer shall determine on or before each Master
Servicer Advance Date whether it is required to make an Advance pursuant to
the definition thereof. If the Master Servicer determines it is required to
make an Advance, it shall, on or before the Master Servicer Advance Date,
either (i) deposit into the Certificate Account an amount equal to the Advance
or (ii) make an appropriate entry in its records relating to the Certificate
Account that any Amount Held for Future Distribution has been used by the
Master Servicer in discharge of its obligation to make any such Advance. Any
funds so applied shall be replaced by the Master Servicer by deposit in the
Certificate Account no later than the close of business on the next Master
Servicer Advance Date. The Master Servicer shall be entitled to be reimbursed
from the Certificate Account for all Advances of its own funds made pursuant
to this Section as provided in Section 3.08. The obligation to make Advances
with respect to any Mortgage Loan shall continue if such Mortgage Loan has
been foreclosed or otherwise terminated and the related Mortgaged Property has
not been liquidated.
(b) If the Master Servicer determines that it will be unable to comply
with its obligation to make the Advances as and when described in the second
sentence of Section 4.01(a), it shall use its best efforts to give written
notice thereof to the Trustee (each such notice a "Trustee Advance Notice";
and such notice may be given by telecopy), not later than 3:00 P.M., New York
time, on the Business Day immediately preceding the related Master Servicer
Advance Date, specifying the amount that it will be unable to deposit (each
such amount an "Advance Deficiency") and certifying that such Advance
Deficiency constitutes an Advance hereunder and is not a Nonrecoverable
Advance. If the Trustee receives a Trustee Advance Notice on or before 3:30
P.M., New York time on a Master Servicer Advance Date, the Trustee shall, not
later than 3:00 P.M., New York time, on the related Distribution Date, deposit
in the Distribution Account an amount equal to the Advance Deficiency
identified in such Trustee Advance Notice unless it is prohibited from so
doing by applicable law. Notwithstanding the foregoing, the Trustee shall not
be required to make such deposit if the Trustee shall have received written
notification from the Master Servicer that the Master Servicer has deposited
or caused to be deposited in the Certificate Account an amount equal to such
Advance Deficiency. All Advances made by the Trustee pursuant to this Section
4.01(b) shall accrue interest on behalf of the Trustee at the Trustee Advance
Rate from and including the date such Advances are made to but excluding the
date of repayment, with such interest being an obligation of the Master
Servicer and not the Trust Fund. The Master Servicer shall reimburse the
Trustee for the amount of any Advance made by the Trustee pursuant to this
Section 4.01(b) together with accrued interest, not later than the fifth day
following the related Master Servicer Advance Date. In the event that the
Master Servicer does not reimburse the Trustee in accordance with the
requirements of the preceding sentence, the Trustee shall have the right, but
not the obligation, to immediately (a) terminate all of the rights and
obligations of the Master Servicer under this Agreement in accordance with
Section 7.01 and (b) subject to the limitations set forth in Section 3.04,
assume all of the rights and obligations of the Master Servicer hereunder.
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(c) The Master Servicer shall, not later than the close of business on
the second Business Day immediately preceding each Distribution Date, deliver
to the Trustee a report (in form and substance reasonably satisfactory to the
Trustee) that indicates (i) the Mortgage Loans with respect to which the
Master Servicer has determined that the related Scheduled Payments should be
advanced and (ii) the amount of the related Scheduled Payments. The Master
Servicer shall deliver to the Trustee on the related Master Servicer Advance
Date an Officer's Certificate of a Servicing Officer indicating the amount of
any proposed Advance determined by the Master Servicer to be a Nonrecoverable
Advance.
SECTION 4.02. Priorities of Distribution.
(a) Distributions of Interest Funds. On each Distribution Date, the
Interest Funds for such Distribution Date shall be allocated by the Trustee
from the Distribution Account in the following order of priority:
(i) from Interest Funds for Loan Group 1 and Loan Group 2, pro rata
based on the Interest Funds for each such Loan Group, to the Swap Account, the
amount of any Net Swap Payment and any Swap Termination Payment (other than a
Swap Termination Payment due to a Swap Counterparty Trigger Event) payable to
the Swap Counterparty with respect to such Distribution Date;
(ii) concurrently:
(A) from Interest Funds for Loan Group 1, concurrently, to each
Class of Group 1 Senior Certificates, the Current Interest and Interest
Carry Forward Amount for each such Class and Distribution Date, pro
rata, based on their respective entitlements; and
(B) from Interest Funds for Loan Group 2, concurrently, to each
Class of Group 2 Senior Certificates, the Current Interest and Interest
Carry Forward Amount for each such Class and Distribution Date, pro
rata, based on their respective entitlements;
(iii) from the remaining Interest Funds for both Loan Groups to each
Class of Senior Certificates, any remaining Current Interest and Interest
Carry Forward Amount not paid pursuant to clauses (a)(ii)(A) or (a)(ii)(B)
above, pro rata, based on their respective Class Certificate Balances, to the
extent needed to pay any Current Interest and Interest Carry Forward Amount
for each such Class; provided that Interest Funds remaining after such
allocation to pay any Current Interest and Interest Carry Forward Amount based
on their respective Class Certificate Balances, will be distributed to each
Class of Senior Certificates with respect to which there remains any unpaid
Current Interest and Interest Carry Forward Amount (after the distribution
based on their respective Class Certificate Balances, pro rata, based on the
amount of such remaining unpaid Current Interest and Interest Carry Forward
Amount;
(iv) from the remaining Interest Funds from both Loan Groups in the
following order of priority:
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(A) sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class
M-4, Class M-5, Class M-6, Class M-7 and Class M-8, Certificates, in
that order, the Current Interest for each such Class and such
Distribution Date; and
(B) any remainder as part of the Excess Cashflow.
(b) Distributions of Principal Distribution Amount. On each Distribution
Date, the Principal Distribution Amount for such Distribution Date shall be
allocated by the Trustee from the Distribution Account in the following order
of priority with all distributions pursuant to this clause (b) being made
first from the Principal Remittance Amount:
(i) For each Distribution Date prior to the Stepdown Date or on which a
Trigger Event is in effect:
(A) concurrently:
(1) from the Principal Distribution Amount for Loan Group 1,
sequentially:
(a) sequentially,
(i) to the Class A-R Certificates, until its
Class Certificate Balance is reduced to zero, and
(ii) concurrently, to the Class 1-A-1 and
Class 1-A-2 Certificates, pro rata, until their
respective Class Certificate Balances are reduced to
zero;
(b) from any remaining Principal Distribution Amount
for Loan Group 1, to the Group 2 Senior Certificates (after
the distribution of the Principal Distribution Amount from
Loan Group 2 as provided in clause (b)(i)(A)(2)(a) below),
to be allocated among such Classes of Certificates in the
order and priorities described in clause (b)(iii) below,
until their respective Class Certificate Balances are
reduced to zero; and
(2) from the Principal Distribution Amount for Loan Group 2,
sequentially:
(a) to the Group 2 Senior Certificates, to be
allocated among such Classes of Certificates in the order
and priorities described in clause (b)(iii) below, until
their respective Class Certificate Balances are reduced to
zero; and
(b) from any remaining Principal Distribution Amount
for Loan Group 2, concurrently, to the Class 1-A-1 and Class
1-A-2 Certificates (after the distribution of the Principal
Distribution Amount from Loan Group 1 as provided in clause
(b)(i)(A)(1)(a) above), pro rata, until their respective
Class Certificate Balances are reduced to zero; and
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(B) from the remaining Principal Distribution Amounts for both
Loan Groups, sequentially:
(1) sequentially, to the Class X-0, Xxxxx X-0, Class M-3,
Class M-4, Class M-5, Class M-6, Class M-7 and Class M-8
Certificates, in that order, until their respective Class
Certificate Balances are reduced to zero; and
(2) any remainder as part of the Excess Cashflow.
(ii) For each Distribution Date on or after the Stepdown Date and so
long as a Trigger Event is not in effect, from the Principal Distribution
Amounts from both Loan Groups, sequentially:
(A) concurrently:
(1) from the Group 1 Principal Distribution Amount,
sequentially:
(a) in an amount up to the Group 1 Principal
Distribution Target Amount, concurrently, to the Class 1-A-1
and Class 1-A-2 Certificates, pro rata, until their
respective Class Certificate Balances are reduced to zero;
and
(b) from any remaining Group 1 Principal Distribution
Amount, to the Group 2 Senior Certificates (up to the Group
2 Principal Distribution Target Amount remaining unpaid,
after the distribution of the Group 2 Principal Distribution
Amount as provided in clause (b)(ii)(A)(2)(a) below), to be
allocated among such Classes of Certificates in the order
and priorities described in clause (b)(iii) below, until
their respective Class Certificate Balances are reduced to
zero; and
(2) from the Group 2 Principal Distribution Amount,
sequentially:
(a) in an amount up to the Group 2 Principal
Distribution Target Amount, to the Group 2 Senior
Certificates, to be allocated among such Classes of
Certificates in the order and priorities described in clause
(b)(iii) below, until their respective Class Certificate
Balances are reduced to zero; and
(b) from any remaining Group 2 Principal Distribution
Amount, concurrently, to the Class 1-A-1 and Class 1-A-2
Certificates (up to the Group 1 Principal Distribution
Target Amount remaining unpaid, after the distribution of
the Group 1 Principal Distribution Amount as provided in
clause (b)(ii)(A)(1)(a) above), pro rata, until their
respective Class Certificate Balances are reduced to zero;
and
(B) from the remaining Principal Distribution Amounts for both
Loan Groups, sequentially to the Class X-0, Xxxxx X-0, Class M-3, Class
M-4, Class M-5, Class M-6, Class M-7 and Class M-8 Certificates, in that
order, the Subordinated Class Principal
84
Distribution Target Amount for each such Class, in each case until its
Class Certificate Balance is reduced to zero; and
(C) any remainder as part of the Excess Cashflow.
(iii) For each Distribution Date on which any principal amounts are to
be distributed to the Group 2 Senior Certificates pursuant to clause (b)(i)(A)
or (b)(ii)(A) above, such amounts will be distributed sequentially:
(i) sequentially, to the Class 2-A-1 and Class 2-A-2
Certificates, in that order, until their respective Class
Certificate Balances are reduced to zero; and
(ii) concurrently, to the Class 2-A-3A and Class 2-A-3B
Certificates, pro rata, until their respective Class Certificate
Balances are reduced to zero.
(c) Distributions of Excess Cashflow. With respect to any Distribution
Date, any Excess Cashflow will be paid to the Classes of Certificates in the
following order of priority, in each case to the extent of remaining Excess
Cashflow:
(i) to the Classes of Offered Certificates then entitled to
receive distributions in respect of principal, in an aggregate amount
equal to the Extra Principal Distribution Amount for the Loan Groups
payable to such Classes of Certificates as part of the Principal
Distribution Amount pursuant to Section 4.02(b) hereof;
(ii) concurrently, to the Holders of the Senior Certificates, pro
rata based on the amount of Unpaid Realized Loss Amounts for each such
Class, in each case in an amount equal to the Unpaid Realized Loss
Amount for each such Class; provided, however, that any amounts
allocable to the Class 1-A-1 and Class 1-A-2 Certificates will be
allocated first, to the Class 1-A-1 Certificates, in an amount up to the
Unpaid Realized Loss Amount for such Class, and then to the Class 1-A-2
Certificates and any amounts allocable to the Class 2-A-3A and Class
2-A-3B Certificates will be allocated first, to the Class 2-A-3A
Certificates, in an amount up to the Unpaid Realized Loss Amount for
such Class, and then to the Class 2-A-3B Certificates;
(iii) sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class
M-4, Class M-5, Class M-6, Class M-7 and Class M-8 Certificateholders,
in that order, in each case first in an amount equal to any Interest
Carry Forward Amount for such Class and then in an amount equal to the
Unpaid Realized Loss Amount for such Class;
(iv) to the Carryover Reserve Fund and then from the Carryover
Reserve Fund, concurrently, to the Classes of Offered Certificates, pro
rata based on their respective Class Certificate Balances to the extent
needed to pay any unpaid Net Rate Carryover for each such Class; and
then any Excess Cashflow remaining after such allocation to pay Net Rate
Carryover based on Class Certificate Balances of the Certificates will
be distributed to each Class of Offered Certificates with respect to
which there remains any unpaid Net Rate Carryover, pro rata, based on
the amount of such unpaid Net Rate Carryover;
85
(v) to the Swap Account in an amount equal to any Swap Termination
Payment due to the Swap Counterparty as a result of a Swap Counterparty
Trigger Event;
(vi) to the Class C Certificateholders, an amount up to the Class
C Distributable Amount for such Distribution Date; and
(vii) to the Class A-R Certificates.
(d) On each Distribution Date on or prior to the Swap Contract
Termination Date, following the deposits to the Swap Account pursuant to
4.02(a)(i) and Section 4.09 and the distributions described under Section
4.02(c)(i) through (iii), the Swap Trustee shall distribute amounts on deposit
in the Swap Account in the following amounts and order of priority:
(i) to the Swap Contract Administrator for payment to the Swap
Counterparty, any Net Swap Payment payable to the Swap Counterparty with
respect to such Distribution Date;
(ii) to the Swap Contract Administrator for payment to the Swap
Counterparty, any Swap Termination Payment (other than a Swap
Termination Payment due to a Swap Counterparty Trigger Event) payable to
the Swap Counterparty with respect to such Distribution Date;
(iii) concurrently to the Holders of each Class of Senior
Certificates, any remaining Current Interest and Interest Carry Forward
Amount, pro rata based on their respective entitlements;
(iv) sequentially, to the Holders of the Class M-1, Class M-2,
Class M-3, Class M-4, Class M-5, Class M-6, Class M-7 and Class M-8
Certificates, in that order, in each case in an amount equal to any
remaining Current Interest and Interest Carry Forward Amount for each
such Class;
(v) to the Holders of the Class or Classes of LIBOR Certificates
then entitled to receive distributions in respect of principal, in an
aggregate amount equal to the Overcollateralization Deficiency Amount
remaining unpaid following the distributions described under Section
4.02(c), payable to such Holders of each such Class in the same manner
in which the Extra Principal Distribution Amount in respect of Loan
Group 1 and Loan Group 2 would be distributed to such Classes as
described under Section 4.02(c);
(vi) to the Holders of each Class of LIBOR Certificates, to the
extent needed to pay any remaining Net Rate Carryover for each such
Class, pro rata, based on the amount of such remaining Net Rate
Carryover;
(vii) concurrently, to the Holders of each Class of Senior
Certificates, pro rata, based on the remaining Unpaid Realized Loss
Amounts for such Classes, in each case in an amount equal to the
remaining Unpaid Realized Loss Amount for each such Class; provided,
however, that (i) any amounts allocable to the Class 1-A-1 and Class
1-A-2 Certificates will be allocated first to the Class 1-A-1
Certificates, in an amount up to the remaining Unpaid Realized Loss
Amount for such Class, and then to the Class 1-A-2
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Certificates and (ii) any amounts allocable to the Class 2-A-3A and
Class 2-A-3B Certificates will be allocated first to the Class 2-A-3A
Certificates, in an amount up to the remaining Unpaid Realized Loss
Amount for such Class, and then to the Class 2-A-3B Certificates; and
(viii) sequentially, to the Holders of the Class M-1, Class M-2,
Class M-3, Class M-4, Class M-5, Class M-6, Class M-7 and Class M-8
Certificates, in that order, in each case in an amount equal to the
remaining Unpaid Realized Loss Amount for each such Class.
On each Distribution Date on or prior to the Swap Contract
Termination Date, following the deposit to the Swap Account pursuant to
Section 4.02(c)(v), the Swap Trustee shall distribute amounts on deposit in
the Swap Account to the Swap Contract Administrator for payment to the Swap
Counterparty, any Swap Termination Payment due to a Swap Counterparty Trigger
Event payable to the Swap Counterparty with respect to such Distribution Date.
(e) To the extent that a Class of LIBOR Certificates receives interest
in excess of the related Net Rate Cap, such interest shall be deemed to have
been paid to the Carryover Reserve Fund and then paid by the Carryover Reserve
Fund to those Certificateholders. For purposes of the Code, amounts deemed
deposited in the Carryover Reserve Fund shall be deemed to have first been
distributed to the Class C Certificates. To the extent that a Class of LIBOR
Certificates receives interest in excess of the related Net Rate Cap and such
interest is paid pursuant to Section 4.02(d), such interest shall be deemed to
have been paid to the Swap Account and then paid by the Swap Account to those
Certificateholders.
(f) On each Distribution Date, all Prepayment Charges (including amounts
deposited in connection with the full or partial waiver of such Prepayment
Charges pursuant to Section 3.20) shall be allocated and paid to the Class P
Certificates. On the Class P Principal Distribution Date, the Trustee shall
make the $100.00 distribution to the Class P Certificates as specified in
Section 3.08.
(g) Application of Applied Realized Loss Amounts. On each Distribution
Date, the Trustee shall allocate the Applied Realized Loss Amount to reduce
the Class Certificate Balances of the Subordinated Certificates, sequentially,
to the Class X-0, Xxxxx X-0, Class M-6, Class M-5, Class M-4, Class M-3, Class
M-2 and Class M-1 Certificates, in that order, until their respective Class
Certificate Balances are reduced to zero. Thereafter, (i) if the aggregate
Class Certificate Balance of the Group 1 Senior Certificates exceeds the
aggregate Stated Principal Balance of the Group 1 Mortgage Loans, the amount
of such excess will be applied to reduce the Class Certificate Balance of the
Class 1-A-2 and Class 1-A-1 Certificates, in that order, until their
respective Class Certificate Balances have been reduced to zero, and (ii) if
the aggregate Class Certificate Balance of the Group 2 Senior Certificates
exceeds the aggregate Stated Principal Balance of the Group 2 Mortgage Loans,
the amount of such excess will be applied to reduce the Class Certificate
Balance of each Class of Group 2 Senior Certificates, on a pro rata basis
according to their respective Class Certificate Balances, until the Class
Certificate Balances of such Classes have been reduced to zero, except that
any such excess otherwise allocable to the Class 2-A-3A Certificates will
instead be allocated to the Class 2-A-3B Certificates, until its Class
Certificate Balance has been reduced to zero.
87
(h) Application of Subsequent Recoveries. First, if Subsequent
Recoveries have been received with respect to a Liquidated Mortgage Loan, the
amount of such Subsequent Recoveries will be applied pro rata based on the
Unpaid Realized Loss Amounts for each Class, to increase the Class Certificate
Balance of the Senior Certificates in an amount up to the amount of Unpaid
Realized Losses on each such Class of Certificates; provided, however that (i)
any amounts allocable to the Class 1-A-1 and Class 1-A-2 Certificates will be
allocated first, to the Class 1-A-1 Certificates in an amount up to the Unpaid
Realized Loss Amount for that Class, and then to the Class 1-A-2 Certificates
and (ii) any amounts allocable to the Class 2-A-3A and Class 2-A-3B
Certificates will be allocated first, to the Class 2-A-3A Certificates in an
amount up to the Unpaid Realized Loss Amount for that Class, and then to the
Class 2-A-3B Certificates. Second, if Subsequent Recoveries have been received
with respect to a Liquidated Mortgage Loan the amount of such Subsequent
Recoveries will be applied sequentially, in the order of payment priority, to
increase the Class Certificate Balance of each Class of Subordinated
Certificates to which Realized Losses have been allocated, but in each case by
not more than the amount of Unpaid Realized Losses on that Class of
Certificates. Holders of such Certificates will not be entitled to any payment
in respect of Current Interest on the amount of such increases for any
Interest Accrual Period preceding the Distribution Date on which such increase
occurs. Any such increases shall be applied pro rata to the Certificate
Balance of each Certificate of such Class.
SECTION 4.03. [Reserved].
SECTION 4.04. [Reserved].
SECTION 4.05. [Reserved].
SECTION 4.06. Monthly Statements to Certificateholders.
(a) Concurrently with each distribution on a Distribution Date, the
Trustee will forward by mail to each Rating Agency and make available to
Certificateholders on the Trustee's website
(xxxx://xxx.xxxxxxxxxxxxxxxxxxxx.xxx) a statement generally setting forth the
information contained in Exhibit U.
(b) The Trustee's responsibility for disbursing the above information to
the Certificateholders is limited to the availability, timeliness and accuracy
of the information provided by the Master Servicer.
(c) On or before the fifth Business Day following the end of each
Prepayment Period (but in no event later than the third Business Day prior to
the related Distribution Date), the Master Servicer shall deliver to the
Trustee (which delivery may be by electronic data transmission) a report in
substantially the form set forth as Schedule VI hereto.
(d) Within a reasonable period of time after the end of each calendar
year, the Trustee shall cause to be furnished to each Person who at any time
during the calendar year was a Certificateholder, a statement containing the
information set forth in items (1), (2) and (7) of Exhibit U aggregated for
such calendar year or applicable portion thereof during which such Person was
a Certificateholder. Such obligation of the Trustee shall be deemed to have
been
88
satisfied to the extent that substantially comparable information shall be
provided by the Trustee pursuant to any requirements of the Code as from time
to time in effect.
SECTION 4.07. Determination of Pass-Through Rates for COFI Certificates.
The Pass-Through Rate for each Class of COFI Certificates for each
Interest Accrual Period after the initial Interest Accrual Period shall be
determined by the Trustee as provided below on the basis of the Index and the
applicable formulae appearing in footnotes corresponding to the COFI
Certificates in the table relating to the Certificates in the Preliminary
Statement.
Except as provided below, with respect to each Interest Accrual Period
following the initial Interest Accrual Period, the Trustee shall not later
than two Business Days prior to such Interest Accrual Period but following the
publication of the applicable Index determine the Pass-Through Rate at which
interest shall accrue in respect of the COFI Certificates during the related
Interest Accrual Period.
Except as provided below, the Index to be used in determining the
respective Pass-Through Rates for the COFI Certificates for a particular
Interest Accrual Period shall be COFI for the second calendar month preceding
the Outside Reference Date for such Interest Accrual Period. If at the Outside
Reference Date for any Interest Accrual Period, COFI for the second calendar
month preceding such Outside Reference Date has not been published, the
Trustee shall use COFI for the third calendar month preceding such Outside
Reference Date. If COFI for neither the second nor third calendar months
preceding any Outside Reference Date has been published on or before the
related Outside Reference Date, the Index for such Interest Accrual Period and
for all subsequent Interest Accrual Periods shall be the National Cost of
Funds Index for the third calendar month preceding such Interest Accrual
Period (or the fourth preceding calendar month if such National Cost of Funds
Index for the third preceding calendar month has not been published by such
Outside Reference Date). In the event that the National Cost of Funds Index
for neither the third nor fourth calendar months preceding an Interest Accrual
Period has been published on or before the related Outside Reference Date,
then for such Interest Accrual Period and for each succeeding Interest Accrual
Period, the Index shall be LIBOR, determined in the manner set forth below.
With respect to any Interest Accrual Period for which the applicable
Index is LIBOR, LIBOR for such Interest Accrual Period will be established by
the Trustee on the related Interest Determination Date as provided in Section
4.08.
In determining LIBOR and any Pass-Through Rate for the COFI Certificates
or any Reserve Interest Rate, the Trustee may conclusively rely and shall be
protected in relying upon the offered quotations (whether written, oral or on
the Reuters Screen) from the Reference Banks or the New York City banks as to
LIBOR or the Reserve Interest Rate, as appropriate, in effect from time to
time. The Trustee shall not have any liability or responsibility to any Person
for (i) the Trustee's selection of New York City banks for purposes of
determining any Reserve Interest Rate or (ii) its inability, following a
good-faith reasonable effort, to obtain such quotations from the Reference
Banks or the New York City banks or to determine such arithmetic mean, all as
provided for in this Section 4.07.
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The establishment of LIBOR and each Pass-Through Rate for the COFI
Certificates by the Trustee shall (in the absence of manifest error) be final,
conclusive and binding upon each Holder of a Certificate and the Trustee.
SECTION 4.08. Determination of Pass-Through Rates for LIBOR
Certificates.
(a) On each Interest Determination Date so long as any LIBOR
Certificates are outstanding, the Trustee will determine LIBOR on the basis of
the British Bankers' Association ("BBA") "Interest Settlement Rate" for
one-month deposits in U.S. dollars as quoted on the Bloomberg Terminal as of
each LIBOR Determination Date.
(b) If on any Interest Determination Date, LIBOR cannot be determined as
provided in paragraph (A) of this Section 4.08, the Trustee shall either (i)
request each Reference Bank to inform the Trustee of the quotation offered by
its principal London office for making one-month United States dollar deposits
in leading banks in the London interbank market, as of 11:00 a.m. (London
time) on such Interest Determination Date or (ii) in lieu of making any such
request, rely on such Reference Bank quotations that appear at such time on
the Reuters Screen LIBO Page (as defined in the International Swap Dealers
Association Inc. Code of Standard Wording, Assumptions and Provisions for
Swaps, 1986 Edition), to the extent available. LIBOR for the next Interest
Accrual Period will be established by the Trustee on each interest
Determination Date as follows:
(i) If on any Interest Determination Date two or more Reference
Banks provide such offered quotations, LIBOR for the next applicable
Interest Accrual Period shall be the arithmetic mean of such offered
quotations (rounding such arithmetic mean upwards if necessary to the
nearest whole multiple of 1/32%).
(ii) If on any Interest Determination Date only one or none of the
Reference Banks provides such offered quotations, LIBOR for the next
Interest Accrual Period shall be whichever is the higher of (i) LIBOR as
determined on the previous Interest Determination Date or (ii) the
Reserve Interest Rate. The "Reserve Interest Rate" shall be the rate per
annum which the Trustee determines to be either (i) the arithmetic mean
(rounded upwards if necessary to the nearest whole multiple of 1/32%) of
the one-month United States dollar lending rates that New York City
banks selected by the Trustee are quoting, on the relevant Interest
Determination Date, to the principal London offices of at least two of
the Reference Banks to which such quotations are, in the opinion of the
Trustee, being so made, or (ii) in the event that the Trustee can
determine no such arithmetic mean, the lowest one-month United States
dollar lending rate which New York City banks selected by the Trustee
are quoting on such Interest Determination Date to leading European
banks.
(iii) If on any Interest Determination Date the Trustee is
required but is unable to determine the Reserve Interest Rate in the
manner provided in paragraph (b) above, LIBOR for the related Classes of
Certificates shall be LIBOR as determined on the preceding applicable
Interest Determination Date.
Until all of the LIBOR Certificates are paid in full, the Trustee will
at all times retain at least four Reference Banks for the purpose of
determining LIBOR with respect to each Interest
90
Determination Date. The Master Servicer initially shall designate the
Reference Banks. Each "Reference Bank" shall be a leading bank engaged in
transactions in Eurodollar deposits in the international Eurocurrency market,
shall not control, be controlled by, or be under common control with, the
Trustee and shall have an established place of business in London. If any such
Reference Bank should be unwilling or unable to act as such or if the Master
Servicer should terminate its appointment as Reference Bank, the Trustee shall
promptly appoint or cause to be appointed another Reference Bank. The Trustee
shall have no liability or responsibility to any Person for (i) the selection
of any Reference Bank for purposes of determining LIBOR or (ii) any inability
to retain at least four Reference Banks which is caused by circumstances
beyond its reasonable control.
(c) The Pass-Through Rate for each Class of LIBOR Certificates for each
Interest Accrual Period shall be determined by the Trustee on each Interest
Determination Date so long as the LIBOR Certificates are outstanding on the
basis of LIBOR and the respective formulae appearing in footnotes
corresponding to the LIBOR Certificates in the table relating to the
Certificates in the Preliminary Statement.
In determining LIBOR, any Pass-Through Rate for the LIBOR Certificates,
any Interest Settlement Rate, or any Reserve Interest Rate, the Trustee may
conclusively rely and shall be protected in relying upon the offered
quotations (whether written, oral or on the Dow Xxxxx Markets) from the BBA
designated banks, the Reference Banks or the New York City banks as to LIBOR,
the Interest Settlement Rate or the Reserve Interest Rate, as appropriate, in
effect from time to time. The Trustee shall not have any liability or
responsibility to any Person for (i) the Trustee's selection of New York City
banks for purposes of determining any Reserve Interest Rate or (ii) its
inability, following a good-faith reasonable effort, to obtain such quotations
from, the BBA designated banks, the Reference Banks or the New York City banks
or to determine such arithmetic mean, all as provided for in this Section
4.08.
The establishment of LIBOR and each Pass-Through Rate for the LIBOR
Certificates by the Trustee shall (in the absence of manifest error) be final,
conclusive and binding upon each Holder of a Certificate and the Trustee.
SECTION 4.09. Swap Trust and Swap Account.
On the Closing Date, there is hereby established a separate trust (the
"Swap Trust"), the assets of which shall consist of the Trustee's rights and
obligations under the Swap Administration Agreement. The Swap Trust shall be
maintained by the Swap Trustee, who initially, shall be the Trustee. The Swap
Trustee shall hold the assets of the Swap Trust in trust for the benefit of
the Holders of the LIBOR Certificates and the Swap Counterparty. No later than
the Closing Date, the Swap Trustee shall establish and maintain a separate,
segregated trust account to be held in the Swap Trust, titled, "Swap Account,
The Bank of New York, as Swap Trustee, in trust for the Swap Counterparty and
the registered holders of CWALT, Inc., Mortgage Pass-Through Certificates,
Series 2006-OC1." Such account shall be an Eligible Account and funds on
deposit therein shall be held separate and apart from, and shall not be
commingled with, any other moneys, including, without limitation, other moneys
of the Trustee held pursuant to this Agreement. Amounts therein shall be held
uninvested. Funds on deposit in the Swap Account shall be distributed in the
amounts and in the order of priority described under
91
Section 4.02(d). For federal income tax purposes, the Swap Trust, including
the Swap Account, shall be owned by the Class C Certificates.
On each Distribution Date, the Trustee shall make a deposit to the Swap
Account pursuant to Section 4.02(a)(i), and to the extent that the amount of
such deposit is insufficient to pay any Net Swap Payment and/or Swap
Termination Payment (other than a Swap Termination Payment due to a Swap
Counterparty Trigger Event) due to the Swap Counterparty with respect to such
Distribution Date, the Trustee shall withdraw, out of amounts on deposit in
the Distribution Account in respect of the Principal Remittance Amount for
each Loan Group, pro rata on the basis of those respective Principal
Remittance Amounts, such additional amount as is necessary to cover the
remaining portion of any such Net Swap Payment and/or Swap Termination Payment
(other than a Swap Termination Payment due to a Swap Counterparty Trigger
Event) due to the Swap Counterparty with respect to such Distribution Date.
92
ARTICLE V
THE CERTIFICATES
SECTION 5.01. The Certificates.
The Certificates shall be substantially in the forms attached hereto as
exhibits. The Certificates shall be issuable in registered form, in the
minimum dollar denominations, integral dollar multiples in excess thereof and
aggregate dollar denominations set forth in the following table:
Original Class
Integral Multiples in Certificate Balance
Class Minimum Denomination Excess of Minimum or Notional Amount
------------------------- ----------------------- ----------------------- -----------------------
1-A-1 $25,000 $1,000 $373,442,000.00
1-A-2 $25,000 $1,000 $41,493,000.00
2-A-1 $25,000 $1,000 $373,818,000.00
2-A-2 $25,000 $1,000 $151,496,000.00
2-A-3A $25,000 $1,000 $148,305,000.00
2-A-3B $25,000 $1,000 $16,478,000.00
A-IO $25,000(1) $1,000 $1,200,470,312.00
M-1 $25,000 $1,000 $20,407,000.00
M-2 $25,000 $1,000 $18,007,000.00
M-3 $25,000 $1,000 $11,404,000.00
M-4 $25,000 $1,000 $9,003,000.00
M-5 $25,000 $1,000 $9,603,000.00
M-6 $25,000 $1,000 $8,403,000.00
M-7 $25,000 $1,000 $8,403,000.00
M-8 $25,000 $1,000 $6,002,000.00
A-R $99.95(2) N/A $100
C N/A N/A N/A
P N/A N/A $100
(1) Minimum denomination is based on the Notional Amount of such Class.
(2) The Tax Matters Person Certificate may be issued in a denomination of $0.05.
Subject to Section 9.02 respecting the final distribution on the
Certificates, on each Distribution Date the Trustee shall make distributions
to each Certificateholder of record on the preceding Record Date either (x) by
wire transfer in immediately available funds to the account of such holder at
a bank or other entity having appropriate facilities therefor, if (i) such
Holder has so notified the Trustee at least five Business Days prior to the
related Record Date and (ii) such Holder shall hold (A) a Notional Amount
Certificate, (B) 100% of the Class Certificate Balance of any Class of
Certificates or (C) Certificates of any Class with aggregate principal
Denominations of not less than $1,000,000 or (y) by check mailed by first
class mail to such Certificateholder at the address of such holder appearing
in the Certificate Register.
The Certificates shall be executed by manual or facsimile signature on
behalf of the Trustee by an authorized officer. Certificates bearing the
manual or facsimile signatures of individuals who were, at the time when such
signatures were affixed, authorized to sign on behalf of the Trustee shall
bind the Trustee, notwithstanding that such individuals or any of them
93
have ceased to be so authorized prior to the countersignature and delivery of
such Certificates or did not hold such offices at the date of such
Certificate. No Certificate shall be entitled to any benefit under this
Agreement, or be valid for any purpose, unless countersigned by the Trustee by
manual signature, and such countersignature upon any Certificate shall be
conclusive evidence, and the only evidence, that such Certificate has been
duly executed and delivered hereunder. All Certificates shall be dated the
date of their countersignature. On the Closing Date, the Trustee shall
countersign the Certificates to be issued at the direction of the Depositor,
or any affiliate of the Depositor.
The Depositor shall provide, or cause to be provided, to the Trustee on
a continuous basis, an adequate inventory of Certificates to facilitate
transfers.
SECTION 5.02. Certificate Register; Registration of Transfer and
Exchange of Certificates.
(a) The Trustee shall maintain, or cause to be maintained in accordance
with the provisions of Section 5.06, a Certificate Register for the Trust Fund
in which, subject to the provisions of subsections (b) and (c) below and to
such reasonable regulations as it may prescribe, the Trustee shall provide for
the registration of Certificates and of transfers and exchanges of
Certificates as provided in this Agreement. Upon surrender for registration of
transfer of any Certificate, the Trustee shall execute and deliver, in the
name of the designated transferee or transferees, one or more new Certificates
of the same Class and aggregate Percentage Interest.
At the option of a Certificateholder, Certificates may be exchanged for
other Certificates of the same Class in authorized denominations and
evidencing the same aggregate Percentage Interest upon surrender of the
Certificates to be exchanged at the office or agency of the Trustee. Whenever
any Certificates are so surrendered for exchange, the Trustee shall execute,
authenticate, and deliver the Certificates which the Certificateholder making
the exchange is entitled to receive. Every Certificate presented or
surrendered for registration of transfer or exchange shall be accompanied by a
written instrument of transfer in form satisfactory to the Trustee duly
executed by the holder thereof or his attorney duly authorized in writing.
No service charge to the Certificateholders shall be made for any
registration of transfer or exchange of Certificates, but payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates may be required.
All Certificates surrendered for registration of transfer or exchange
shall be cancelled and subsequently destroyed by the Trustee in accordance
with the Trustee's customary procedures.
(b) No transfer of a Private Certificate shall be made unless such
transfer is made pursuant to an effective registration statement under the
Securities Act and any applicable state securities laws or is exempt from the
registration requirements under said Act and such state securities laws. In
the event that a transfer is to be made in reliance upon an exemption from the
Securities Act and such laws, in order to assure compliance with the
Securities Act and such laws, the Certificateholder desiring to effect such
transfer and such Certificateholder's prospective transferee shall each
certify to the Trustee in writing the facts surrounding the
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transfer in substantially the forms set forth in Exhibit J (the "Transferor
Certificate") and (i) deliver a letter in substantially the form of either
Exhibit K (the "Investment Letter") or Exhibit L (the "Rule 144A Letter") or
(ii) there shall be delivered to the Trustee at the expense of the transferor
an Opinion of Counsel that such transfer may be made pursuant to an exemption
from the Securities Act; provided, however, that in the case of the delivery
of an Investment Letter in connection with the transfer of any Class C or
Class P Certificate to a transferee that is formed with the purpose of issuing
notes backed by such Class C or Class P Certificate, as the case may be,
clause (b) and (c) of the form of Investment Letter shall not be applicable
and shall be deleted by such transferee. The Depositor shall provide to any
Holder of a Private Certificate and any prospective transferee designated by
any such Holder, information regarding the related Certificates and the
Mortgage Loans and such other information as shall be necessary to satisfy the
condition to eligibility set forth in Rule 144A(d)(4) for transfer of any such
Certificate without registration thereof under the Securities Act pursuant to
the registration exemption provided by Rule 144A. The Trustee and the Master
Servicer shall cooperate with the Depositor in providing the Rule 144A
information referenced in the preceding sentence, including providing to the
Depositor such information regarding the Certificates, the Mortgage Loans and
other matters regarding the Trust Fund as the Depositor shall reasonably
request to meet its obligation under the preceding sentence. Each Holder of a
Private Certificate desiring to effect such transfer shall, and does hereby
agree to, indemnify the Trustee and the Depositor, the Sellers, the NIM
Insurer and the Master Servicer against any liability that may result if the
transfer is not so exempt or is not made in accordance with such federal and
state laws.
No transfer of an ERISA-Restricted Certificate shall be made unless the
Trustee shall have received either (i) a representation from the transferee of
such Certificate acceptable to and in form and substance satisfactory to the
Trustee (in the event such Certificate is a Private Certificate, such
requirement is satisfied only by the Trustee's receipt of a representation
letter from the transferee substantially in the form of Exhibit K or Exhibit
L, or in the event such Certificate is a Residual Certificate, such
requirement is satisfied only by the Trustee's receipt of a representation
letter from the transferee substantially in the form of Exhibit I), to the
effect that (x) such transferee is not an employee benefit plan or arrangement
subject to Section 406 of ERISA or a plan or arrangement subject to Section
4975 of the Code, nor a person acting on behalf of any such plan or
arrangement or using the assets of any such plan or arrangement to effect such
transfer or (y) in the case of a Certificate that is an ERISA-Restricted
Certificate and that has been the subject of an ERISA-Qualifying Underwriting,
a representation that the transferee is an insurance company which is
purchasing such Certificates with funds contained in an "insurance company
general account" (as such term is defined in Section V(e) of Prohibited
Transaction Class Exemption 95-60 ("PTCE 95-60")) and that the purchase and
holding of such Certificates satisfy the requirements for exemptive relief
under Sections I and III of PTCE 95-60 or (ii) in the case of any
ERISA-Restricted Certificate presented for registration in the name of an
employee benefit plan or arrangement subject to ERISA or a plan or arrangement
subject to Section 4975 of the Code (or comparable provisions of any
subsequent enactments), or a trustee or any other person acting on behalf of
any such plan or arrangement, or using such plan's or arrangement's assets, an
Opinion of Counsel satisfactory to the Trustee, which Opinion of Counsel shall
not be an expense of the Trustee, the Master Servicer or the Trust Fund,
addressed to the Trustee and the Master Servicer to the effect that the
purchase and holding of such ERISA-Restricted Certificate will not result in a
non-exempt prohibited transaction under Section 406 of ERISA or Section 4975
of the Code and will not subject the Trustee or the Master
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Servicer to any obligation in addition to those expressly undertaken in this
Agreement or to any liability (such Opinion of Counsel, a "Benefit Plan
Opinion"). For purposes of the preceding sentence, with respect to an
ERISA-Restricted Certificate that is not a Residual Certificate, in the event
the representation letter or Benefit Plan Opinion referred to in the preceding
sentence is not so furnished, one of the representations in clause (i), as
appropriate, shall be deemed to have been made to the Trustee by the
transferee's (including an initial acquiror's) acceptance of the
ERISA-Restricted Certificates. Notwithstanding anything else to the contrary
in this Agreement, any purported transfer of an ERISA-Restricted Certificate
to or on behalf of an employee benefit plan or arrangement subject to ERISA or
to Section 4975 of the Code without the delivery to the Trustee of a Benefit
Plan Opinion of Counsel satisfactory to the Trustee as described above shall
be void and of no effect.
To the extent permitted under applicable law (including, but not limited
to, ERISA), the Trustee shall be under no liability to any Person for any
registration of transfer of any ERISA-Restricted Certificate that is in fact
not permitted by this Section 5.02(b) or 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 by the Trustee in accordance with the foregoing requirements.
No transfer of a LIBOR Certificate (other than a transfer of a LIBOR
Certificate to an affiliate of the Depositor (either directly or through a
nominee) in connection with the initial issuance of the Certificates) shall be
made unless the Trustee shall have received either (i) a representation from
the transferee of such LIBOR Certificate acceptable to and in form and
substance satisfactory to the Trustee to the effect that such transferee is
not a Plan, or (ii) a representation that the purchase and holding of the
LIBOR Certificate satisfies the requirements for exemptive relief under XXXX
00-00, XXXX 00-0, XXXX 00-00, XXXX 00-00, XXXX 96-23 or a similar exemption.
In the event that such representation letter is not delivered, one of the
foregoing representations, as appropriate, shall be deemed to have been made
by the transferee's (including an initial acquiror's) acceptance of the LIBOR
Certificate. In the event that such representation is violated, such transfer
or acquisition shall be void and of no effect.
(c) Each Person who has or who acquires any Ownership Interest in a
Residual Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions, and
the rights of each Person acquiring any Ownership Interest in a Residual
Certificate are expressly subject to the following provisions:
(i) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall be a Permitted Transferee and shall promptly
notify the Trustee of any change or impending change in its status as a
Permitted Transferee.
(ii) Except in connection with (i) the registration of the Tax
Matters Person Certificate in the name of the Trustee or (ii) any
registration in the name of, or transfer of a Residual Certificate to,
an affiliate of the Depositor (either directly or through a nominee) on
or about the Closing Date, no Ownership Interest in a Residual
Certificate may be registered on the Closing Date or thereafter
transferred, and the Trustee shall not register the Transfer of any
Residual Certificate unless the Trustee shall have been furnished with
an affidavit (a "Transfer Affidavit") of the initial owner or the
proposed transferee in the form attached hereto as Exhibit I.
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(iii) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall agree (A) to obtain a Transfer Affidavit from
any other Person to whom such Person attempts to Transfer its Ownership
Interest in a Residual Certificate, (B) to obtain a Transfer Affidavit
from any Person for whom such Person is acting as nominee, trustee or
agent in connection with any Transfer of a Residual Certificate and (C)
not to Transfer its Ownership Interest in a Residual Certificate or to
cause the Transfer of an Ownership Interest in a Residual Certificate to
any other Person if it has actual knowledge that such Person is not a
Permitted Transferee.
(iv) Any attempted or purported Transfer of any Ownership Interest
in a Residual Certificate in violation of the provisions of this Section
5.02(c) shall be absolutely null and void and shall vest no rights in
the purported Transferee. If any purported transferee shall become a
Holder of a Residual Certificate in violation of the provisions of this
Section 5.02(c), then the last preceding Permitted Transferee shall be
restored to all rights as Holder thereof retroactive to the date of
registration of Transfer of such Residual Certificate. The Trustee shall
be under no liability to any Person for any registration of Transfer of
a Residual Certificate that is in fact not permitted by Section 5.02(b)
and this Section 5.02(c) or 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 after receipt of the related Transfer
Affidavit, Transferor Certificate and either the Rule 144A Letter or the
Investment Letter, if required. The Trustee shall be entitled but not
obligated to recover from any Holder of a Residual Certificate that was
in fact not a Permitted Transferee at the time it became a Holder or, at
such subsequent time as it became other than a Permitted Transferee, all
payments made on such Residual Certificate at and after either such
time. Any such payments so recovered by the Trustee shall be paid and
delivered by the Trustee to the last preceding Permitted Transferee of
such Certificate.
(v) The Depositor shall use its best efforts to make available,
upon receipt of written request from the Trustee, all information
necessary to compute any tax imposed under Section 860E(e) of the Code
as a result of a Transfer of an Ownership Interest in a Residual
Certificate to any Holder who is not a Permitted Transferee.
The restrictions on Transfers of a Residual Certificate set forth in
this Section 5.02(c) shall cease to apply (and the applicable portions of the
legend on a Residual Certificate may be deleted) with respect to Transfers
occurring after delivery to the Trustee of an Opinion of Counsel, which
Opinion of Counsel shall not be an expense of the Trust Fund, the Trustee, the
Master Servicer or any Seller, to the effect that the elimination of such
restrictions will not cause any REMIC hereunder to fail to qualify as a REMIC
at any time that the Certificates are outstanding or result in the imposition
of any tax on the Trust Fund, a Certificateholder or another Person. Each
Person holding or acquiring any Ownership Interest in a Residual Certificate
hereby consents to any amendment of this Agreement which, based on an Opinion
of Counsel furnished to the Trustee, is reasonably necessary (a) to ensure
that the record ownership of, or any beneficial interest in, a Residual
Certificate is not transferred, directly or indirectly, to a Person that is
not a Permitted Transferee and (b) to provide for a means to compel the
Transfer of a Residual Certificate which is held by a Person that is not a
Permitted Transferee to a Holder that is a Permitted Transferee.
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(d) The preparation and delivery of all certificates and opinions
referred to above in this Section 5.02 in connection with transfer shall be at
the expense of the parties to such transfers.
(e) Except as provided 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 Certificates may not be transferred by the
Trustee except to another Depository; (ii) the Depository shall maintain
book-entry records with respect to the Certificate Owners and with respect to
ownership and transfers of such Book-Entry Certificates; (iii) 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; (iv) the Depository may collect its usual and customary fees,
charges and expenses from its Depository Participants; (v) the Trustee shall
deal with the Depository, Depository Participants and indirect participating
firms as representatives of the Certificate Owners of the Book-Entry
Certificates for purposes of exercising the rights of 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 (vi) 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 participating firms and persons shown on the books of
such indirect participating firms as direct or indirect Certificate Owners.
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 Owner. 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.
If (x) (i) the Depository or the Depositor advises the Trustee in
writing that the Depository is no longer willing or able to properly discharge
its responsibilities as Depository, and (ii) the Trustee or the Depositor is
unable to locate a qualified successor or (y) after the occurrence of an Event
of Default, Certificate Owners representing at least 51% of the Certificate
Balance of the Book-Entry Certificates together advise the Trustee and the
Depository through the Depository Participants in writing that the
continuation of a book-entry system through the Depository is no longer in the
best interests of the Certificate Owners, the Trustee shall notify all
Certificate Owners, through the Depository, of the occurrence of any such
event and of the availability of definitive, fully-registered Certificates
(the "Definitive Certificates") to Certificate Owners requesting the same.
Upon surrender to the Trustee of the related Class of Certificates by the
Depository, accompanied by the instructions from the Depository for
registration, the Trustee shall issue the Definitive Certificates. Neither the
Master Servicer, the Depositor nor the Trustee shall be liable for any delay
in delivery of such instruction and each may conclusively rely on, and shall
be protected in relying on, such instructions. The Master Servicer shall
provide the Trustee with an adequate inventory of certificates to facilitate
the issuance and transfer of Definitive Certificates. Upon the issuance of
Definitive Certificates all references in this Agreement to obligations
imposed upon or to be performed by the Depository shall be deemed to be
imposed upon and performed by the Trustee, to the extent applicable with
respect to such Definitive Certificates and the Trustee shall recognize the
Holders of the Definitive Certificates as Certificateholders hereunder;
provided that the Trustee shall not by
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virtue of its assumption of such obligations become liable to any party for
any act or failure to act of the Depository.
SECTION 5.03. Mutilated, Destroyed, Lost or Stolen Certificates.
If (a) any mutilated Certificate is surrendered to the Trustee, or the
Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Certificate and (b) there is delivered to the Master Servicer and
the Trustee such security or indemnity as may be required by them to save each
of them harmless, then, in the absence of notice to the Trustee that such
Certificate has been acquired by a bona fide purchaser, the Trustee shall
execute, countersign and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
Class, tenor and Percentage Interest. In connection with the issuance of any
new Certificate under this Section 5.03, the Trustee may require 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 (including the fees and
expenses of the Trustee) connected therewith. Any replacement Certificate
issued pursuant to this Section 5.03 shall constitute complete and
indefeasible evidence of ownership, as if originally issued, whether or not
the lost, stolen or destroyed Certificate shall be found at any time.
SECTION 5.04. Persons Deemed Owners.
The Master Servicer, the NIM Insurer, the Trustee and any agent of the
Master Servicer, the NIM Insurer or the Trustee may treat the Person in whose
name any Certificate is registered as the owner of such Certificate for the
purpose of receiving distributions as provided in this Agreement and for all
other purposes whatsoever, and neither the Master Servicer, the NIM Insurer,
the Trustee nor any agent of the Master Servicer, the NIM Insurer or the
Trustee shall be affected by any notice to the contrary.
SECTION 5.05. Access to List of Certificateholders' Names and Addresses.
If three or more Certificateholders and/or Certificate Owners (a)
request such information in writing from the Trustee, (b) state that such
Certificateholders and/or Certificate Owners desire to communicate with other
Certificateholders and/or Certificate Owners with respect to their rights
under this Agreement or under the Certificates, and (c) provide a copy of the
communication which such Certificateholders and/or Certificate Owners propose
to transmit, or if the Depositor or Master Servicer shall request such
information in writing from the Trustee, then the Trustee shall, within ten
Business Days after the receipt of such request, (x) provide the Depositor,
the Master Servicer or such Certificateholders and/or Certificate Owners at
such recipients' expense the most recent list of the Certificateholders of
such Trust Fund held by the Trustee, if any, and (y) assist the Depositor, the
Master Servicer or such Certificateholders and/or Certificate Owners at such
recipients' expense with obtaining from the Depository a list of the related
Depository Participants acting on behalf of Certificate Owners of Book Entry
Certificates. The Depositor and every Certificateholder and Certificate Owner,
by receiving and holding a Certificate or beneficial interest therein, agree
that the Trustee shall not be held accountable by reason of the disclosure of
any such information as to the list of the Certificateholders and/or
Depository Participants hereunder, regardless of the source from which such
information was derived.
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SECTION 5.06. Maintenance of Office or Agency.
The Trustee will maintain or cause to be maintained at its expense an
office or offices or agency or agencies in New York City where Certificates
may be surrendered for registration of transfer or exchange. The Trustee
initially designates its Corporate Trust Office for such purposes. The Trustee
will give prompt written notice to the Certificateholders of any change in
such location of any such office or agency.
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ARTICLE VI
THE DEPOSITOR AND THE MASTER SERVICER
SECTION 6.01. Respective Liabilities of the Depositor and the Master
Servicer.
The Depositor and the Master Servicer shall each be liable in accordance
with this Agreement only to the extent of the obligations specifically and
respectively imposed upon and undertaken by them in this Agreement.
SECTION 6.02. Merger or Consolidation of the Depositor or the Master
Servicer.
The Depositor will keep in full effect its existence, rights and
franchises as a corporation under the laws of the United States or under the
laws of one of the states thereof and will obtain and preserve its
qualification to do business as a foreign corporation in each jurisdiction in
which such qualification is or shall be necessary to protect the validity and
enforceability of this Agreement, or any of the Mortgage Loans and to perform
its duties under this Agreement. The Master Servicer will keep in effect its
existence, rights and franchises as a limited partnership under the laws of
the United States or under the laws of one of the states thereof and will
obtain and preserve its qualification or registration to do business as a
foreign partnership in each jurisdiction in which such qualification or
registration is or shall be necessary to protect the validity and
enforceability of this Agreement or any of the Mortgage Loans and to perform
its duties under this Agreement.
Any Person into which the Depositor or the Master Servicer may be merged
or consolidated, or any Person resulting from any merger or consolidation to
which the Depositor or the Master Servicer shall be a party, or any person
succeeding to the business of the Depositor or the Master Servicer, shall be
the successor of the Depositor or the Master Servicer, as the case may be,
hereunder, without the execution or filing of any paper or any further act on
the part of any of the parties hereto, anything in this Agreement to the
contrary notwithstanding; provided, however, that the successor or surviving
Person to the Master Servicer shall be qualified to service mortgage loans on
behalf of, FNMA or FHLMC.
As a condition to the effectiveness of any merger or consolidation, at
least 15 calendar days prior to the effective date of any merger or
consolidation of the Master Servicer, the Master Servicer shall provide (x)
written notice to the Depositor of any successor pursuant to this Section and
(y) in writing and in form and substance reasonably satisfactory to the
Depositor, all information reasonably requested by the Depositor in order to
comply with its reporting obligation under Item 6.02 of Form 8-K with respect
to a replacement Master Servicer.
SECTION 6.03. Limitation on Liability of the Depositor, the Sellers, the
Master Servicer, the NIM Insurer and Others.
None of the Depositor, the Master Servicer, the NIM Insurer or any
Seller or any of the directors, officers, employees or agents of the
Depositor, the Master Servicer, the NIM Insurer or any Seller shall be under
any liability to the Certificateholders for any action taken or for refraining
from the taking of any action in good faith pursuant to this Agreement, or for
errors in judgment; provided, however, that this provision shall not protect
the Depositor, the Master Servicer, any Seller or any such Person against any
breach of representations or warranties made
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by it in this Agreement or protect the Depositor, the Master Servicer, any
Seller or any such Person from any liability which would otherwise be imposed
by reasons of willful misfeasance, bad faith or gross negligence in the
performance of duties or by reason of reckless disregard of obligations and
duties hereunder. The Depositor, the Master Servicer, the NIM Insurer, each
Seller and any director, officer, employee or agent of the Depositor, the
Master Servicer, the NIM Insurer or each Seller may rely in good faith on any
document of any kind prima facie properly executed and submitted by any Person
respecting any matters arising under this Agreement. The Depositor, the Master
Servicer, the NIM Insurer, each Seller and any director, officer, employee or
agent of the Depositor, the Master Servicer, the NIM Insurer or any Seller
shall be indemnified by the Trust Fund and held harmless against any loss,
liability or expense incurred in connection with any audit, controversy or
judicial proceeding relating to a governmental taxing authority or any legal
action relating to this Agreement or the Certificates, other than any loss,
liability or expense related to any specific Mortgage Loan or Mortgage Loans
(except as any such loss, liability or expense shall be otherwise reimbursable
pursuant to this Agreement) and any loss, liability or expense incurred by
reason of willful misfeasance, bad faith or gross negligence in the
performance of duties hereunder or by reason of reckless disregard of
obligations and duties hereunder. None of the Depositor, the Master Servicer,
the NIM Insurer or any Seller shall be under any obligation to appear in,
prosecute or defend any legal action that is not incidental to its respective
duties hereunder and which in its opinion may involve it in any expense or
liability; provided, however, that any of the Depositor, the Master Servicer,
the NIM Insurer or any Seller may in its discretion undertake any such action
that it may deem necessary or desirable in respect of this Agreement and the
rights and duties of the parties hereto and interests of the Trustee and the
Certificateholders hereunder. In such event, the legal expenses and costs of
such action and any liability resulting therefrom shall be expenses, costs and
liabilities of the Trust Fund, and the Depositor, the Master Servicer, the NIM
Insurer and each Seller shall be entitled to be reimbursed therefor out of the
Certificate Account.
SECTION 6.04. Limitation on Resignation of Master Servicer.
The Master Servicer shall not resign from the obligations and duties
hereby imposed on it except (a) upon appointment of a successor servicer that
is reasonably acceptable to the Trustee and the NIM Insurer and the written
confirmation from each Rating Agency (which confirmation shall be furnished to
the Depositor, the Trustee and the NIM Insurer) that such resignation will not
cause such Rating Agency to reduce the then-current rating of the Certificates
or (b) upon determination that its duties hereunder are no longer permissible
under applicable law. Any such determination under clause (b) permitting the
resignation of the Master Servicer shall be evidenced by an Opinion of Counsel
to such effect delivered to the Trustee. No resignation of the Master Servicer
shall become effective until the Trustee or a successor master servicer shall
have assumed the Master Servicer's responsibilities, duties, liabilities
(other than those liabilities arising prior to the appointment of such
successor) and obligations under this Agreement and the Depositor shall have
received the information described in the following sentence. As a condition
to the effectiveness of any such resignation, at least 15 calendar days prior
to the effective date of such resignation, the Master Servicer shall provide
(x) written notice to the Depositor of any successor pursuant to this Section
and (y) in writing and in form and substance reasonably satisfactory to the
Depositor, all information reasonably requested by the Depositor in order to
comply with its reporting obligation under Item 6.02 of Form 8-K with respect
to the resignation of the Master Servicer.
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ARTICLE VII
DEFAULT
SECTION 7.01. Events of Default.
"Event of Default," wherever used in this Agreement, means any one of
the following events:
(i) any failure by the Master Servicer to deposit in the
Certificate Account or remit to the Trustee any payment required to be
made under the terms of this Agreement, which failure shall continue
unremedied for five days after the date upon which written notice of
such failure shall have been given to the Master Servicer by the
Trustee, the NIM Insurer or the Depositor or to the Master Servicer, the
NIM Insurer and the Trustee by the Holders of Certificates having not
less than 25% of the Voting Rights evidenced by the Certificates; or
(ii) any failure by the Master Servicer to observe or perform in
any material respect any other of the covenants or agreements on the
part of the Master Servicer contained in this Agreement (except with
respect to a failure related to a Limited Exchange Act Reporting
Obligation), which failure materially affects the rights of
Certificateholders, that failure continues unremedied for a period of 60
days after the date on which written notice of such failure shall have
been given to the Master Servicer by the Trustee, the NIM Insurer or the
Depositor, or to the Master Servicer and the Trustee by the Holders of
Certificates evidencing not less than 25% of the Voting Rights evidenced
by the Certificates; provided, however, that the sixty day cure period
shall not apply to the initial delivery of the Mortgage File for Delay
Delivery Mortgage Loans nor the failure to substitute or repurchase in
lieu of delivery; or
(iii) a decree or order of a court or agency or supervisory
authority having jurisdiction in the premises for the appointment of a
receiver or liquidator in any insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings, or for the
winding-up or liquidation of its affairs, shall have been entered
against the Master Servicer and such decree or order shall have remained
in force undischarged or unstayed for a period of 60 consecutive days;
or
(iv) the Master Servicer shall consent to the appointment of a
receiver or liquidator in any insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings of or
relating to the Master Servicer or all or substantially all of the
property of the Master Servicer; or
(v) the Master Servicer shall admit in writing its inability to
pay its debts generally as they become due, file a petition to take
advantage of, or commence a voluntary case under, any applicable
insolvency or reorganization statute, make an assignment for the benefit
of its creditors, or voluntarily suspend payment of its obligations; or
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(vi) the Master Servicer shall fail to reimburse in full the
Trustee within five days of the Master Servicer Advance Date for any
Advance made by the Trustee pursuant to Section 4.01(b) together with
accrued and unpaid interest.
If an Event of Default described in clauses (i) to (vi) of this Section
shall occur, then, and in each and every such case, so long as such Event of
Default shall not have been remedied, the Trustee may, or, if an Event of
Default described in clauses (i) to (v) of this Section shall occur, then, and
in each and every such case, so long as such Event of Default shall not have
been remedied, at the direction of either the NIM Insurer or the Holders of
Certificates evidencing not less than 66-2/3% of the Voting Rights, evidenced
by the Certificates; the Trustee shall by notice in writing to the Master
Servicer (with a copy to each Rating Agency and the Depositor), terminate all
of the rights and obligations of the Master Servicer under this Agreement and
in and to the Mortgage Loans and the proceeds thereof, other than its rights
as a Certificateholder hereunder. In addition, if during the period that the
Depositor is required to file Exchange Act Reports with respect to the Trust
Fund, the Master Servicer shall fail to observe or perform any of the
obligations that constitute a Limited Exchange Act Reporting Obligation or the
obligations set forth in Section 3.16(a) or Section 11.01(a)(1) and (2), and
such failure continues for the lesser of 10 calendar days or such period in
which the applicable Exchange Act Report can be filed timely (without taking
into account any extensions), so long as such failure shall not have been
remedied, the Trustee shall, but only at the direction of the Depositor,
terminate all of the rights and obligations of the Master Servicer under this
Agreement and in and to the Mortgage Loans and the proceeds thereof, other
than its rights as a Certificateholder hereunder. The Depositor shall not be
entitled to terminate the rights and obligations of the Master Servicer if a
failure of the Master Servicer to identify a Subcontractor "participating in
the servicing function" within the meaning of Item 1122 of Regulation AB was
attributable solely to the role or functions of such Subcontractor with
respect to mortgage loans other than the Mortgage Loans.
On and after the receipt by the Master Servicer of such written notice,
all authority and power of the Master Servicer hereunder, whether with respect
to the Mortgage Loans or otherwise, shall pass to and be vested in the
Trustee. The Trustee shall thereupon make any Advance which the Master
Servicer failed to make subject to Section 4.01 whether or not the obligations
of the Master Servicer have been terminated pursuant to this Section. The
Trustee is hereby authorized and empowered to execute and deliver, on behalf
of the Master Servicer, as attorney-in-fact or otherwise, any and all
documents and other instruments, and to do or accomplish all other acts or
things necessary or appropriate to effect the purposes of such notice of
termination, whether to complete the transfer and endorsement or assignment of
the Mortgage Loans and related documents, or otherwise. Unless expressly
provided in such written notice, no such termination shall affect any
obligation of the Master Servicer to pay amounts owed pursuant to Article
VIII. The Master Servicer agrees to cooperate with the Trustee in effecting
the termination of the Master Servicer's responsibilities and rights
hereunder, including, without limitation, the transfer to the Trustee of all
cash amounts which shall at the time be credited to the Certificate Account,
or thereafter be received with respect to the Mortgage Loans.
Notwithstanding any termination of the activities of the Master Servicer
hereunder, the Master Servicer shall be entitled to receive, out of any late
collection of a Scheduled Payment on a Mortgage Loan which was due prior to
the notice terminating such Master Servicer's rights and obligations as Master
Servicer hereunder and received after such notice, that portion thereof to
which such Master Servicer would have been entitled pursuant to Sections
3.08(a)(i) through
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(viii), and any other amounts payable to such Master Servicer hereunder the
entitlement to which arose prior to the termination of its activities under
this Agreement.
If the Master Servicer is terminated, the Trustee shall provide the
Depositor in writing and in form and substance reasonably satisfactory to the
Depositor, all information reasonably requested by the Depositor in order to
comply with its reporting obligation under Item 6.02 of Form 8-K with respect
to a successor master servicer in the event the Trustee should succeed to the
duties of the Master Servicer as set forth herein.
SECTION 7.02. Trustee to Act; Appointment of Successor.
On and after the time the Master Servicer receives a notice of
termination pursuant to Section 7.01, the Trustee shall, subject to and to the
extent provided in Section 3.04, be the successor to the Master Servicer in
its capacity as master servicer under this Agreement and the transactions set
forth or provided for in this Agreement and shall be subject to all the
responsibilities, duties and liabilities relating thereto placed on the Master
Servicer by the terms and provisions of this Agreement and applicable law
including the obligation to make Advances pursuant to Section 4.01. As
compensation therefor, the Trustee shall be entitled to all funds relating to
the Mortgage Loans that the Master Servicer would have been entitled to charge
to the Certificate Account or Distribution Account if the Master Servicer had
continued to act hereunder. Notwithstanding the foregoing, if the Trustee has
become the successor to the Master Servicer in accordance with Section 7.01,
the Trustee may, if it shall be unwilling to so act, or shall, if it is
prohibited by applicable law from making Advances pursuant to Section 4.01 or
if it is otherwise unable to so act, (i) appoint any established mortgage loan
servicing institution reasonably acceptable to the NIM Insurer (as evidenced
by the prior written consent of the NIM Insurer), or (ii) if it is unable for
60 days to appoint a successor servicer reasonably acceptable to the NIM
Insurer, petition a court of competent jurisdiction to appoint any established
mortgage loan servicing institution, the appointment of which does not
adversely affect the then-current rating of the Certificates and the NIM
Insurer guaranteed notes (without giving any effect to any policy or guaranty
provided by the NIM Insurer) by each Rating Agency as the successor to the
Master Servicer hereunder in the assumption of all or any part of the
responsibilities, duties or liabilities of the Master Servicer hereunder. Any
successor to the Master Servicer shall be an institution which is a FNMA and
FHLMC approved seller/servicer in good standing, which has a net worth of at
least $15,000,000, and which is willing to service the Mortgage Loans and (i)
executes and delivers to the Depositor and the Trustee an agreement accepting
such delegation and assignment, which contains an assumption by such Person of
the rights, powers, duties, responsibilities, obligations and liabilities of
the Master Servicer (other than liabilities of the Master Servicer under
Section 6.03 incurred prior to termination of the Master Servicer under
Section 7.01), with like effect as if originally named as a party to this
Agreement; and provided further that each Rating Agency acknowledges that its
rating of the Certificates in effect immediately prior to such assignment and
delegation will not be qualified or reduced as a result of such assignment and
delegation and (ii) provides to the Depositor in writing, fifteen (15) days
prior to the effective date of such appointment, and in form and substance
reasonably satisfactory to the Depositor, all information reasonably requested
by the Depositor in order to comply with its reporting obligation under Item
6.02 of Form 8-K with respect to a replacement master servicer. The Trustee
shall provide written notice to the Depositor of such successor pursuant to
this Section. Pending appointment of a successor to the Master Servicer
hereunder, the Trustee, unless the Trustee is prohibited by law from so
acting, shall, subject to Section 3.04, act in such
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capacity as hereinabove provided. In connection with such appointment and
assumption, the Trustee may make such arrangements for the compensation of
such successor out of payments on Mortgage Loans as it and such successor
shall agree; provided, however, that no such compensation shall be in excess
of the Master Servicing Fee permitted the Master Servicer hereunder. The
Trustee and such successor shall take such action, consistent with this
Agreement, as shall be necessary to effectuate any such succession. Neither
the Trustee nor any other successor master servicer shall be deemed to be in
default hereunder by reason of any failure to make, or any delay in making,
any distribution hereunder or any portion thereof or any failure to perform,
or any delay in performing, any duties or responsibilities hereunder, in
either case caused by the failure of the Master Servicer to deliver or
provide, or any delay in delivering or providing, any cash, information,
documents or records to it.
Any successor to the Master Servicer as master servicer shall give
notice to the NIM Insurer and the Mortgagors of such change of servicer and
shall, during the term of its service as master servicer maintain in force the
policy or policies that the Master Servicer is required to maintain pursuant
to Section 3.09.
In connection with the termination or resignation of the Master Servicer
hereunder, either (i) the successor Master Servicer, including the Trustee if
the Trustee is acting as successor Master Servicer, shall represent and
warrant that it is a member of MERS in good standing and shall agree to comply
in all material respects with the rules and procedures of MERS in connection
with the servicing of the Mortgage Loans that are registered with MERS, or
(ii) the predecessor Master Servicer shall cooperate with the successor Master
Servicer either (x) in causing MERS to execute and deliver an assignment of
Mortgage in recordable form to transfer the Mortgage from MERS to the Trustee
and to execute and deliver such other notices, documents and other instruments
as may be necessary or desirable to effect a transfer of such Mortgage Loan or
servicing of such Mortgage Loan on the MERS(R) System to the successor Master
Servicer or (y) in causing MERS to designate on the MERS(R) System the
successor Master Servicer as the servicer of such Mortgage Loan. The
predecessor Master Servicer shall file or cause to be filed any such
assignment in the appropriate recording office. The successor Master Servicer
shall cause such assignment to be delivered to the Trustee promptly upon
receipt of the original with evidence of recording thereon or a copy certified
by the public recording office in which such assignment was recorded.
SECTION 7.03. Notification to Certificateholders.
(a) Upon any termination of or appointment of a successor to the Master
Servicer, the Trustee shall give prompt written notice thereof to
Certificateholders and to each Rating Agency.
(b) Within 60 days after the occurrence of any Event of Default, the
Trustee shall transmit by mail to all Certificateholders notice of each such
Event of Default hereunder known to the Trustee, unless such Event of Default
shall have been cured or waived.
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ARTICLE VIII
CONCERNING THE TRUSTEE
SECTION 8.01. Duties of Trustee.
The Trustee, prior to the occurrence of an Event of Default and after
the curing of all Events of Default that may have occurred, shall undertake to
perform such duties and only such duties as are specifically set forth in this
Agreement. In case an Event of Default has occurred and remains uncured, the
Trustee shall exercise such of the rights and powers vested in it by this
Agreement, and use the same degree of care and skill in their exercise as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs.
The Trustee, upon receipt of all resolutions, certificates, statements,
opinions, reports, documents, orders or other instruments furnished to the
Trustee that are specifically required to be furnished pursuant to any
provision of this Agreement shall examine them to determine whether they are
in the form required by this Agreement; provided, however, that the Trustee
shall not be responsible for the accuracy or content of any such resolution,
certificate, statement, opinion, report, document, order or other instrument.
No provision of this Agreement shall be construed to relieve the Trustee
from liability for its own negligent action, its own negligent failure to act
or its own willful misconduct; provided, however, that:
(i) unless an Event of Default known to the Trustee shall have
occurred and be continuing, the duties and obligations of the Trustee
shall be determined solely by the express provisions of this Agreement,
the Trustee shall not be liable except for the performance of such
duties and obligations as are specifically set forth in this Agreement,
no implied covenants or obligations shall be read into this Agreement
against the Trustee and the Trustee may conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed
therein, upon any certificates or opinions furnished to the Trustee and
conforming to the requirements of this Agreement which it believed in
good faith to be genuine and to have been duly executed by the proper
authorities respecting any matters arising hereunder;
(ii) the Trustee shall not be liable for an error of judgment made
in good faith by a Responsible Officer or Responsible Officers of the
Trustee, unless it shall be finally proven that the Trustee was
negligent in ascertaining the pertinent facts;
(iii) the Trustee shall not be liable with respect to any action
taken, suffered or omitted to be taken by it in good faith in accordance
with the direction of Holders of Certificates evidencing not less than
25% of the Voting Rights of Certificates relating to the time, method
and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred upon the Trustee
under this Agreement; and
(iv) without in any way limiting the provisions of this Section
8.01 or Section 8.02, the Trustee shall be entitled to rely conclusively
on the information delivered to it by the Master Servicer in a Trustee
Advance Notice in determining whether it is required
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to make an Advance under Section 4.01(b), shall have no responsibility
to ascertain or confirm any information contained in any Trustee Advance
Notice, and shall have no obligation to make any Advance under Section
4.01(b) in the absence of a Trustee Advance Notice or actual knowledge
of a Responsible Officer of the Trustee that (A) such Advance was not
made by the Master Servicer and (B) such Advance is not a Nonrecoverable
Advance.
SECTION 8.02. Certain Matters Affecting the Trustee.
Except as otherwise provided in Section 8.01:
(i) the Trustee may request and rely upon and shall be protected
in acting or refraining from acting upon any resolution, Officers'
Certificate, certificate of auditors or any other certificate,
statement, instrument, opinion, report, notice, request, consent, order,
appraisal, bond or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties and
the Trustee shall have no responsibility to ascertain or confirm the
genuineness of any signature of any such party or parties;
(ii) the Trustee may consult with counsel, financial advisers or
accountants of its selection and the advice of any such counsel,
financial advisers or accountants and any Opinion of Counsel shall be
full and complete authorization and protection in respect of any action
taken or suffered or omitted by it hereunder in good faith and in
accordance with such Opinion of Counsel;
(iii) the Trustee shall not be liable for any action taken,
suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers conferred upon
it by this Agreement;
(iv) the Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval,
bond or other paper or document, unless requested in writing so to do by
the NIM Insurer or Holders of Certificates evidencing not less than 25%
of the Voting Rights allocated to each Class of Certificates;
(v) the Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through agents,
accountants or attorneys;
(vi) the Trustee shall not be required to risk or expend its own
funds or otherwise incur any financial liability in the performance of
any of its duties or in the exercise of any of its rights or powers
hereunder if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or
liability is not assured to it;
(vii) the Trustee shall not be liable for any loss on any
investment of funds pursuant to this Agreement (other than as issuer of
the investment security);
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(viii) the Trustee shall not be deemed to have knowledge of an
Event of Default until a Responsible Officer of the Trustee shall have
received written notice thereof; and
(ix) the Trustee shall be under no obligation to exercise any of
the trusts, rights or powers vested in it by this Agreement or to
institute, conduct or defend any litigation hereunder or in relation
hereto at the request, order or direction of the NIM Insurer or any of
the Certificateholders, pursuant to the provisions of this Agreement,
unless the NIM Insurer or such Certificateholders shall have offered to
the Trustee reasonable security or indemnity satisfactory to the Trustee
against the costs, expenses and liabilities which may be incurred
therein or thereby.
The Depositor hereby directs the Trustee to execute, deliver
and perform its obligations under the Swap Administration Agreement (in its
capacity as Swap Trustee). The Sellers, the Depositor, the Master Servicer and
the Holders of the LIBOR Certificates by their acceptance of such Certificates
acknowledge and agree that the Trustee shall execute, deliver and perform its
obligations under the Swap Administration Agreement and shall do so solely in
its capacity as Swap Trustee, as the case may be, and not in its individual
capacity. Every provision of this Agreement relating to the conduct or
affecting the liability of or affording protection to the Trustee shall apply
to the Trustee's execution of the Swap Administration Agreement in its
capacity as Swap Trustee, and the performance of its duties and satisfaction
of its obligations thereunder.
SECTION 8.03. Trustee Not Liable for Certificates or Mortgage Loans.
The recitals contained in this Agreement and in the Certificates shall
be taken as the statements of the Depositor or a Seller, as the case may be,
and the Trustee assumes no responsibility for their correctness. The Trustee
makes no representations as to the validity or sufficiency of this Agreement
or of the Certificates or of any Mortgage Loan or related document or of MERS
or the MERS(R) System other than with respect to the Trustee's execution and
counter-signature of the Certificates. The Trustee shall not be accountable
for the use or application by the Depositor or the Master Servicer of any
funds paid to the Depositor or the Master Servicer in respect of the Mortgage
Loans or deposited in or withdrawn from the Certificate Account by the
Depositor or the Master Servicer.
SECTION 8.04. Trustee May Own Certificates.
The Trustee in its individual or any other capacity may become the owner
or pledgee of Certificates with the same rights as it would have if it were
not the Trustee.
SECTION 8.05. Trustee's Fees and Expenses.
The Trustee, as compensation for its activities hereunder, shall be
entitled to withdraw from the Distribution Account on each Distribution Date
an amount equal to the Trustee Fee for such Distribution Date. The Trustee and
any director, officer, employee or agent of the Trustee shall be indemnified
by the Master Servicer and held harmless against any loss, liability or
expense (including reasonable attorney's fees) (i) incurred in connection with
any claim or legal action relating to (a) this Agreement, (b) the Certificates
or (c) in connection with the performance of any of the Trustee's duties
hereunder, other than any loss, liability or expense
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incurred by reason of willful misfeasance, bad faith or negligence in the
performance of any of the Trustee's duties hereunder or incurred by reason of
any action of the Trustee taken at the direction of the Certificateholders and
(ii) resulting from any error in any tax or information return prepared by the
Master Servicer. Such indemnity shall survive the termination of this
Agreement or the resignation or removal of the Trustee hereunder. Without
limiting the foregoing, the Master Servicer covenants and agrees, except as
otherwise agreed upon in writing by the Depositor and the Trustee, and except
for any such expense, disbursement or advance as may arise from the Trustee's
negligence, bad faith or willful misconduct, to pay or reimburse the Trustee,
for all reasonable expenses, disbursements and advances incurred or made by
the Trustee in accordance with any of the provisions of this Agreement with
respect to: (A) the reasonable compensation and the expenses and disbursements
of its counsel not associated with the closing of the issuance of the
Certificates, (B) the reasonable compensation, expenses and disbursements of
any accountant, engineer or appraiser that is not regularly employed by the
Trustee, to the extent that the Trustee must engage such persons to perform
acts or services hereunder and (C) printing and engraving expenses in
connection with preparing any Definitive Certificates. Except as otherwise
provided in this Agreement, the Trustee shall not be entitled to payment or
reimbursement for any routine ongoing expenses incurred by the Trustee in the
ordinary course of its duties as Trustee, Registrar, Tax Matters Person or
Paying Agent hereunder or for any other expenses.
SECTION 8.06. Eligibility Requirements for Trustee.
The Trustee hereunder shall at all times be a corporation or association
organized and doing business under the laws of a state or the United States of
America, authorized under such laws to exercise corporate trust powers, having
a combined capital and surplus of at least $50,000,000, subject to supervision
or examination by federal or state authority and with a credit rating which
would not cause either of the Rating Agencies to reduce or withdraw their
respective then current ratings of the Certificates (or having provided such
security from time to time as is sufficient to avoid such reduction) as
evidenced in writing by each Rating Agency. If such corporation or association
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the
purposes of this Section 8.06 the combined capital and surplus of such
corporation or association shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section 8.06, the Trustee shall resign immediately in the
manner and with the effect specified in Section 8.07. The entity serving as
Trustee may have normal banking and trust relationships with the Depositor and
its affiliates or the Master Servicer and its affiliates; provided, however,
that such entity cannot be an affiliate of the Master Servicer other than the
Trustee in its role as successor to the Master Servicer.
SECTION 8.07. Resignation and Removal of Trustee.
The Trustee may at any time resign and be discharged from the trusts
hereby created by giving written notice of resignation to the Depositor, the
Master Servicer and each Rating Agency not less than 60 days before the date
specified in such notice when, subject to Section 8.08, such resignation is to
take effect, and acceptance by a successor trustee in accordance with Section
8.08 meeting the qualifications set forth in Section 8.06. If no successor
trustee meeting such qualifications shall have been so appointed and have
accepted appointment
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within 30 days after the giving of such notice or resignation, the resigning
Trustee may petition any court of competent jurisdiction for the appointment
of a successor trustee.
As a condition to the effectiveness of any such resignation, at least 15
calendar days prior to the effective date of such resignation, the Trustee
shall provide (x) written notice to the Depositor of any successor pursuant to
this Section and (y) in writing and in form and substance reasonably
satisfactory to the Depositor, all information reasonably requested by the
Depositor in order to comply with its reporting obligation under Item 6.02 of
Form 8-K with respect to the resignation of the Trustee.
If at any time (i) the Trustee shall cease to be eligible in accordance
with the provisions of Section 8.06 hereof and shall fail to resign after
written request thereto by the NIM Insurer or the Depositor, (ii) the Trustee
shall become incapable of acting, or shall be adjudged as bankrupt or
insolvent, or a receiver of the Trustee or of its property shall be appointed,
or any public officer shall take charge or control of the Trustee or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, (iii)(A) a tax is imposed with respect to the Trust Fund by any
state in which the Trustee or the Trust Fund is located, (B) the imposition of
such tax would be avoided by the appointment of a different trustee and (C)
the Trustee fails to indemnify the Trust Fund against such tax, or (iv) during
the period that the Depositor is required to file Exchange Act Reports with
respect to the Trust Fund, the Trustee fails to comply with its obligations
under the last sentence of Section 7.01, in the preceding paragraph, Section
8.09 or Article XI and such failure is not remedied within the lesser of 10
calendar days or such period in which the applicable Exchange Act Report can
be filed timely (without taking into account any extensions), then, in the
case of clauses (i) through (iii), the Depositor, the NIM Insurer or the
Master Servicer, and in the case of clause (iv), the Depositor, may remove the
Trustee and appoint a successor trustee, reasonably acceptable to the NIM
Insurer, by written instrument, in triplicate, one copy of which instrument
shall be delivered to the Trustee, one copy of which shall be delivered to the
Master Servicer, one copy of which shall be delivered to the NIM Insurer and
one copy of which shall be delivered to the successor trustee.
The Holders of Certificates entitled to at least 51% of the Voting
Rights may at any time remove the Trustee and appoint a successor trustee by
written instrument or instruments signed by such Holders or their attorneys-in-
fact duly authorized, one complete set of which instruments shall be delivered
by the successor Trustee to the Master Servicer, one complete set to the Trustee
so removed, one complete set to the NIM Insurer and one complete set to the
successor so appointed. Notice of any removal of the Trustee shall be given to
each Rating Agency by the successor trustee.
Any resignation or removal of the Trustee and appointment of a successor
trustee pursuant to any of the provisions of this Section 8.07 shall become
effective upon acceptance of appointment by the successor trustee as provided
in Section 8.08.
SECTION 8.08. Successor Trustee.
Any successor trustee appointed as provided in Section 8.07 shall
execute, acknowledge and deliver to the Depositor and to its predecessor
trustee and the Master Servicer an instrument accepting such appointment
hereunder and thereupon the resignation or removal of the predecessor trustee
shall become effective and such successor trustee, without any further act,
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deed or conveyance, shall become fully vested with all the rights, powers,
duties and obligations of its predecessor hereunder, with the like effect as
if originally named as trustee in this Agreement. The Depositor, the Master
Servicer and the predecessor trustee shall execute and deliver such
instruments and do such other things as may reasonably be required for more
fully and certainly vesting and confirming in the successor trustee all such
rights, powers, duties, and obligations. In addition, if the Swap Contract is
still outstanding, the Person appointed as successor trustee shall execute,
acknowledge and deliver to the predecessor trustee, Countrywide and the Master
Servicer an instrument accepting the appointment as successor Swap Contract
Administrator under the Swap Contract Administration Agreement.
No successor trustee shall accept appointment as provided in this
Section 8.08 unless at the time of such acceptance such successor trustee
shall be eligible under the provisions of Section 8.06 hereof, is reasonably
acceptable to the NIM Insurer, its appointment shall not adversely affect the
then-current ratings of the Certificates and has provided to the Depositor in
writing and in form and substance reasonably satisfactory to the Depositor,
all information reasonably requested by the Depositor in order to comply with
its reporting obligation under Item 6.02 of Form 8-K with respect to a
replacement Trustee.
Upon acceptance of appointment by a successor trustee as provided in
this Section 8.08, the Depositor shall mail notice of the succession of such
trustee hereunder to the NIM Insurer and all Holders of Certificates. If the
Depositor fails to mail such notice within 10 days after acceptance of
appointment by the successor trustee, the successor trustee shall cause such
notice to be mailed at the expense of the Depositor.
SECTION 8.09. Merger or Consolidation of Trustee.
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any corporation succeeding to the business of the Trustee, shall be the
successor of the Trustee hereunder, provided that such corporation shall be
eligible under the provisions of Section 8.06 without the execution or filing
of any paper or further act on the part of any of the parties hereto, anything
in this Agreement to the contrary notwithstanding.
As a condition to the effectiveness of any merger or consolidation, at
least 15 calendar days prior to the effective date of any merger or
consolidation of the Trustee, the Trustee shall provide (x) written notice to
the Depositor of any successor pursuant to this Section and (y) in writing and
in form and substance reasonably satisfactory to the Depositor, all
information reasonably requested by the Depositor in order to comply with its
reporting obligation under Item 6.02 of Form 8-K with respect to a replacement
Trustee.
SECTION 8.10. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for
the purpose of meeting any legal requirements of any jurisdiction in which any
part of the Trust Fund or property securing any Mortgage Note may at the time
be located, the Master Servicer and the Trustee acting jointly shall have the
power and shall execute and deliver all instruments to appoint one or more
Persons approved by the Trustee and reasonably acceptable to the NIM
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Insurer to act as co-trustee or co-trustees jointly with the Trustee, or
separate trustee or separate trustees, of all or any part of the Trust Fund,
and to vest in such Person or Persons, in such capacity and for the benefit of
the Certificateholders, such title to the Trust Fund or any part thereof,
whichever is applicable, and, subject to the other provisions of this Section
8.10, such powers, duties, obligations, rights and trusts as the Master
Servicer and the Trustee may consider necessary or desirable. If the Master
Servicer shall not have joined in such appointment within 15 days after the
receipt by it of a request to do so, or in the case an Event of Default shall
have occurred and be continuing, the Trustee alone shall have the power to
make such appointment. No co-trustee or separate trustee hereunder shall be
required to meet the terms of eligibility as a successor trustee under Section
8.06 and no notice to Certificateholders of the appointment of any co-trustee
or separate trustee shall be required under Section 8.08.
Every separate trustee and co-trustee shall, to the extent permitted by
law, be appointed and act subject to the following provisions and conditions:
(i) To the extent necessary to effectuate the purposes of this
Section 8.10, all rights, powers, duties and obligations conferred or
imposed upon the Trustee, except for the obligation of the Trustee under
this Agreement to advance funds on behalf of the Master Servicer, shall
be conferred or imposed upon and exercised or performed by the Trustee
and such separate trustee or co-trustee jointly (it being understood
that such separate trustee or co-trustee is not authorized to act
separately without the Trustee joining in such act), except to the
extent that under any law of any jurisdiction in which any particular
act or acts are to be performed (whether as Trustee hereunder or as
successor to the Master Servicer hereunder), the Trustee shall be
incompetent or unqualified to perform such act or acts, in which event
such rights, powers, duties and obligations (including the holding of
title to the applicable Trust Fund or any portion thereof in any such
jurisdiction) shall be exercised and performed singly by such separate
trustee or co-trustee, but solely at the direction of the Trustee;
(ii) No trustee hereunder shall be held personally liable by
reason of any act or omission of any other trustee hereunder and such
appointment shall not, and shall not be deemed to, constitute any such
separate trustee or co-trustee as agent of the Trustee;
(iii) The Trustee may at any time accept the resignation of or
remove any separate trustee or co-trustee; and
(iv) The Master Servicer, and not the Trustee, shall be liable for
the payment of reasonable compensation, reimbursement and
indemnification to any such separate trustee or co-trustee.
Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the separate trustees and co-trustees,
when and as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement
and the conditions of this Article VIII. Each separate trustee and co-trustee,
upon its acceptance of the trusts conferred, shall be vested with the estates
or property specified in its instrument of appointment, either jointly with
the Trustee or separately, as may be provided therein, subject to all the
provisions of this Agreement, specifically including every provision of this
Agreement relating to the conduct of, affecting the liability of, or affording
protection to, the
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Trustee. Every such instrument shall be filed with the Trustee and a copy
thereof given to the Master Servicer and the Depositor.
Any separate trustee or co-trustee may, at any time, constitute the
Trustee its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its
estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
SECTION 8.11. Tax Matters.
It is intended that the assets with respect to which any REMIC
election is to be made, as set forth in the Preliminary Statement, shall
constitute, and that the conduct of matters relating to such assets shall be
such as to qualify such assets as, a "real estate mortgage investment conduit"
as defined in and in accordance with the REMIC Provisions. In furtherance of
such intention, the Trustee covenants and agrees that it shall act as agent
(and the Trustee is hereby appointed to act as agent) on behalf of any such
REMIC and that in such capacity it shall: (a) 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 or any successor form adopted by the
Internal Revenue Service) 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 any such REMIC, 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 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; (b) within thirty days of the
Closing Date, furnish or cause to be furnished to the Internal Revenue
Service, on Forms 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, together with
such additional information as may be required by such Form, and update such
information at the time or times in the manner required by the Code; (c) make
or cause to be made elections that such assets be treated as a REMIC on the
federal tax return for its first taxable year (and, if necessary, under
applicable state law); (d) 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 and reports 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 using the Prepayment Assumption; (e) provide information
necessary for the computation of tax imposed on the transfer of a Residual
Certificate to a Person that is not a Permitted Transferee, or an agent
(including a broker, nominee or other middleman) of a Non-Permitted
Transferee, or a pass-through entity in which a Non-Permitted Transferee 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);
(f) to the extent that they are under its control conduct matters relating to
such assets at all times that any Certificates are outstanding so as to
maintain the status as a REMIC under the REMIC Provisions; (g) not knowingly
or intentionally take any action or omit to take any action that would cause
the termination of the tax status of any REMIC; (h) pay, from the sources
specified in the last paragraph of this Section 8.11, the amount of any
federal or state tax, including prohibited transaction taxes as described
below, imposed on any such REMIC
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prior to its termination when and as the same shall be due and payable (but
such obligation shall not prevent the Trustee or any other appropriate Person
from contesting any such tax in appropriate proceedings and shall not prevent
the Trustee from withholding payment of such tax, if permitted by law, pending
the outcome of such proceedings); (i) 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; (j) maintain records relating to any such REMIC,
including but not limited to the income, expenses, assets and liabilities
thereof and the fair market value and adjusted basis of the assets determined
at such intervals as may be required by the Code, as may be necessary to
prepare the foregoing returns, schedules, statements or information; and (k)
as and when necessary and appropriate, represent any such REMIC in any
administrative or judicial proceedings relating to an examination or audit by
any governmental taxing authority, request an administrative adjustment as to
any taxable year of any such REMIC, enter into settlement agreements with any
governmental taxing agency, extend any statute of limitations relating to any
tax item of any such REMIC, and otherwise act on behalf of any such REMIC in
relation to any tax matter or controversy involving it.
In order to enable the Trustee to perform its duties as set forth
in this Agreement, the Depositor shall provide, or cause to be provided, to
the Trustee within ten (10) days after the Closing Date all information or
data that the Trustee requests in writing and determines to be relevant for
tax purposes to the valuations and offering prices of the Certificates,
including, without limitation, the price, yield, prepayment assumption and
projected cash flows of the Certificates and the Mortgage Loans. Thereafter,
the Depositor shall provide to the Trustee promptly upon written request
therefor, any such additional information or data that the Trustee may, from
time to time, reasonably request in order to enable the Trustee to perform its
duties as set forth in this Agreement. The Depositor hereby indemnifies the
Trustee for any losses, liabilities, damages, claims or expenses of the
Trustee arising from any errors or miscalculations of the Trustee that result
from any failure of the Depositor to provide, or to cause to be provided,
accurate information or data to the Trustee on a timely basis.
In the event that any tax is imposed on "prohibited transactions"
of any REMIC hereunder as defined in Section 860F(a)(2) of the Code, on the
"net income from foreclosure property" of such REMIC as defined in Section
860G(c) of the Code, on any contribution to any REMIC hereunder after the
Startup Day pursuant to Section 860G(d) of the Code, or any other tax is
imposed, including, without limitation, any minimum tax imposed upon any REMIC
hereunder pursuant to Sections 23153 and 24874 of the California Revenue and
Taxation Code, if not paid as otherwise provided for herein, such tax shall be
paid by (i) the Trustee, if any such other tax arises out of or results from a
breach by the Trustee of any of its obligations under this Agreement, (ii) the
Master Servicer, in the case of any such minimum tax, or if such tax arises
out of or results from a breach by the Master Servicer or a Seller of any of
their obligations under this Agreement, (iii) any Seller, if any such tax
arises out of or results from that Seller's obligation to repurchase a
Mortgage Loan pursuant to Section 2.02 or 2.03 or (iv) in all other cases, or
in the event that the Trustee, the Master Servicer or any Seller fails to
honor its obligations under the preceding clauses (i),(ii) or (iii), any such
tax will be paid with amounts otherwise to be distributed to the
Certificateholders, as provided in Section 3.08(b).
The Trustee shall treat the Carryover Reserve Fund and the Swap
Trust, including the Swap Account, as an outside reserve fund within the
meaning of Treasury Regulation
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1.860G-2(h), neither of which is an asset of any REMIC created hereunder. The
Carryover Reserve Fund shall be treated as owned by the holders of the Class C
Certificates, and the Swap Trust, including the Swap Account, shall be treated
as owned by the holders of the Class C Certificates. The Trustee shall treat
the rights of the holders of the LIBOR Certificates and the Class C
Certificates to receive payments from the Carryover Reserve Fund or the Swap
Trust, including the Swap Account, as applicable, as rights and obligations
with respect to notional principal contracts written by (i) the Holders of the
Class C Certificates in respect of any Net Rate Carryover distributed pursuant
to Section 4.02(c)(vi) herein and (ii) the Swap Counterparty in respect of any
Net Rate Carryover funded by the Swap Contract and in respect of any residual
payments from such Swap Contract received by the Class C Certificates. Thus,
the LIBOR Certificates and the Class C Certificates shall be treated as
representing ownership of Master REMIC regular interests coupled with
contractual rights and obligations within the meaning of Treasury Regulation
1.860G-2(i). For purposes of determining the issue price of the various Master
REMIC regular interests, the Trustee shall assume that the Swap Contract has a
value of $2,275,000. The trustee shall treat any amount payable to a Class C
Certificate as first deposited in the Carryover Reserve Fund. In addition, to
the extent the interest otherwise payable to a Certificateholder is reduced
for amounts payable with respect to the Swap Contract, the Trustee, for
federal income tax purposes, shall treat the amount of such reduction as first
payable to the Certificateholder as interest and as then payable by the
Certificateholder with respect to a notional principal contract. To the extent
the amount payable with respect to the Swap Contract exceeds the aggregate of
the reductions described in the immediate sentence, the Trustee, for federal
income tax purposes, shall treat such excess as Realized Losses from Mortgage
Loans and to the extent such Realized Losses (if they had occurred) would be
allocated to a Certificateholder, the Trustee shall treat such amount as first
payable to the Certificateholder as principal and as then payable by the
Certificateholder with respect to a notional principal contract.
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ARTICLE IX
TERMINATION
SECTION 9.01. Termination upon Liquidation or Purchase of all Mortgage
Loans.
Subject to Section 9.03, the obligations and responsibilities of the
Depositor, the Sellers, the Master Servicer and the Trustee created hereby
with respect to the Trust Fund shall terminate upon the earlier of (a) the
purchase by the Master Servicer or NIM Insurer (the party exercising such
purchase option, the "Terminator") of all of the Mortgage Loans (and REO
Properties) remaining in the Trust Fund at the price equal to the sum of (i)
100% of the Stated Principal Balance of each Mortgage Loan in the Trust Fund
(other than in respect of an REO Property), (ii) accrued interest thereon at
the applicable Mortgage Rate (or, if such repurchase is effected by the Master
Servicer, at the applicable Adjusted Mortgage Rate, (iii) the appraised value
of any REO Property in the Trust Fund (up to the Stated Principal Balance of
the related Mortgage Loan), such appraisal to be conducted by an appraiser
mutually agreed upon by the Terminator and the Trustee and (iv) plus, if the
Terminator is the NIM Insurer, any unreimbursed Servicing Advances, and the
principal portion of any unreimbursed Advances, made on the Mortgage Loans
prior to the exercise of such repurchase, and (b) the later of (i) the
maturity or other liquidation (or any Advance with respect thereto) of the
last Mortgage Loan remaining in the Trust Fund and the disposition of all REO
Property and (ii) the distribution to related Certificateholders of all
amounts required to be distributed to them pursuant to this Agreement, as
applicable. In no event shall the trusts created hereby continue beyond the
earlier of (i) the expiration of 21 years from the death of the last survivor
of the descendants of Xxxxxx X. Xxxxxxx, the late Ambassador of the United
States to the Court of St. James's, living on the date hereof and (ii) the
Latest Possible Maturity Date.
The right to purchase all Mortgage Loans and REO Properties by the
Terminator pursuant to clause (a) of the immediately preceding paragraph of
this Section 9.01 shall be conditioned upon (1) the Pool Stated Principal
Balance, at the time of any such repurchase, is less than or equal to ten
percent (10%) of the Cut-off Date Pool Principal Balance and (2) unless the
NIM Insurer otherwise consents, the purchase price for such Mortgage Loans and
REO Properties shall result in a final distribution on any NIM Insurer
guaranteed notes that is sufficient (x) to pay such notes in full and (y) to
pay any amounts due and payable to the NIM Insurer pursuant to the indenture
related to such notes.
The preceding notwithstanding, on any Distribution Date on which each of
the Master Servicer and the NIM Insurer shall have the option to purchase all
the Mortgage Loans (and REO Properties) remaining in the Trust Fund pursuant
to this Section 9.01, the NIM Insurer's purchase option shall require the
prior written consent of the Master Servicer.
The Swap Trust shall terminate on the earlier of (i) the Swap Contract
Termination Date, (ii) the reduction of the aggregate Class Certificate
Balance of the LIBOR Certificates to zero and (iii) the termination of this
Agreement.
SECTION 9.02. Final Distribution on the Certificates.
If on any Determination Date, the Master Servicer determines that there
are no Outstanding Mortgage Loans and no other funds or assets in the Trust
Fund other than the funds
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in the Certificate Account, the Master Servicer shall direct the Trustee
promptly to send a final distribution notice to each Certificateholder. If the
Terminator elects to terminate the Trust Fund pursuant to clause (a) of
Section 9.01, at least 20 days prior to the date notice is to be mailed to the
affected Certificateholders, the Terminator shall notify the Depositor and the
Trustee of the date the Master Servicer intends to terminate the Trust Fund
and of the applicable repurchase price of the Mortgage Loans and REO
Properties.
Notice of any termination of the Trust Fund, specifying the Distribution
Date on which Certificateholders may surrender their Certificates for payment
of the final distribution and cancellation, shall be given promptly by the
Trustee by letter to Certificateholders mailed not earlier than the 10th day
and no later than the 15th day of the month next preceding the month of such
final distribution. Any such notice shall specify (a) the Distribution Date
upon which final distribution on the Certificates will be made upon
presentation and surrender of Certificates at the office therein designated,
(b) the amount of such final distribution, (c) the location of the office or
agency at which such presentation and surrender must be made, and (d) that the
Record Date otherwise applicable to such Distribution Date is not applicable,
distributions being made only upon presentation and surrender of the
Certificates at the office therein specified. The Terminator will give such
notice to each Rating Agency at the time such notice is given to the affected
Certificateholders.
In the event such notice is given, the Master Servicer shall cause all
funds in the Certificate Account to be remitted to the Trustee for deposit in
the Distribution Account on or before the Business Day prior to the applicable
Distribution Date in an amount equal to the final distribution in respect of
the Certificates. Upon such final deposit with respect to the Trust Fund and
the receipt by the Trustee of a Request for Release therefor, the Trustee
shall promptly release to the Master Servicer the Mortgage Files for the
Mortgage Loans.
Upon presentation and surrender of the Certificates, the Trustee shall
cause to be distributed to the Certificateholders of each Class, in each case
on the final Distribution Date and in the order set forth in Section 4.02, in
proportion to their respective Percentage Interests, with respect to
Certificateholders of the same Class, an amount equal to (i) as to each Class
of Regular Certificates, the Certificate Balance thereof plus accrued interest
thereon (or on their Notional Amount, if applicable) in the case of an
interest bearing Certificate and (ii) as to the Residual Certificates, the
amount, if any, which remains on deposit in the Distribution Account (other
than the amounts retained to meet claims) after application pursuant to clause
(i) above. Notwithstanding the reduction of the Class Certificate Balance of
any Class of Certificates to zero, such Class will be outstanding hereunder
(solely for the purpose of receiving distributions and not for any other
purpose) until the termination of the respective obligations and
responsibilities of the Depositor, each Seller, the Master Servicer and the
Trustee hereunder in accordance with Article IX.
In the event that any affected Certificateholders shall not surrender
its Certificates for cancellation within six months after the date specified
in the above mentioned written notice, the Trustee shall give a second written
notice to the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If
within six months after the second notice all the applicable Certificates
shall not have been surrendered for cancellation, the Trustee may take
appropriate steps, or may appoint an agent to take appropriate steps, to
contact the remaining Certificateholders concerning surrender of their
Certificates, and
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the cost thereof shall be paid out of the funds and other assets which remain
a part of the Trust Fund. If within one year after the second notice all
Certificates shall not have been surrendered for cancellation then, the Class
A-R Certificateholders shall be entitled to all unclaimed funds and other
assets of the Trust Fund which remain subject to this Agreement.
SECTION 9.03. Additional Termination Requirements.
(a) In the event the Terminator exercises its purchase option as
provided in Section 9.01, the Trust Fund shall be terminated in accordance
with the following additional requirements, unless the Trustee has been
supplied with an Opinion of Counsel, at the expense of the Terminator, to the
effect that the failure to comply with the requirements of this Section 9.03
will not (i) result in the imposition of taxes on "prohibited transactions" on
any REMIC as defined in section 860F of the Code, or (ii) cause any REMIC
created hereunder to fail to qualify as a REMIC at any time that any
Certificates are outstanding:
(1) The Master Servicer shall establish a 90-day liquidation
period and notify the Trustee thereof, which shall in turn specify the
first day of such period in a statement attached to the Trust Fund's
final Tax Return pursuant to Treasury Regulation Section 1.860F-1. The
Master Servicer shall prepare a plan of complete liquidation and shall
otherwise satisfy all the requirements of a qualified liquidation under
Section 860F of the Code and any regulations thereunder, as evidenced by
an Opinion of Counsel delivered to the Trustee and the Depositor
obtained at the expense of the Terminator; and
(2) Within 90 days after the time of adoption of such a plan
of complete liquidation, the Trustee shall sell all of the assets of the
Trust Fund to the Terminator for cash in accordance with Section 9.01.
(b) The Trustee, as agent for any REMIC created hereunder, hereby agrees
to adopt and sign such a plan of complete liquidation upon the written request
of the Master Servicer, and the receipt of the Opinion of Counsel referred to
in Section 9.03(a)(1) and to take such other action in connection therewith as
may be reasonably requested by the Terminator.
(c) By their acceptance of the Certificates, the Holders thereof hereby
authorize the Master Servicer to prepare and the Trustee to adopt and sign a
plan of complete liquidation.
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ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.01. Amendment.
This Agreement may be amended from time to time by the Depositor, each
Seller, the Master Servicer and the Trustee without the consent of any of the
Certificateholders (i) to cure any ambiguity or mistake, (ii) to correct any
defective provision in this Agreement or to supplement any provision in this
Agreement which may be inconsistent with any other provision in this
Agreement, (iii) to conform this Agreement to the Prospectus and Prospectus
Supplement provided to investors in connection with the initial offering of
the Certificates, (iv) to add to the duties of the Depositor, any Seller or
the Master Servicer, (v) to modify, alter, amend, add to or rescind any of the
terms or provisions contained in this Agreement to comply with any rules or
regulations promulgated by the Securities and Exchange Commission from time to
time, (vi) to add any other provisions with respect to matters or questions
arising hereunder or (vii) to modify, alter, amend, add to or rescind any of
the terms or provisions contained in this Agreement; provided that any action
pursuant to clauses (vi) or (vii) above shall not, as evidenced by an Opinion
of Counsel (which Opinion of Counsel shall not be an expense of the Trustee or
the Trust Fund), adversely affect in any material respect the interests of any
Certificateholder; provided, however, that the amendment shall be deemed not
to adversely affect in any material respect the interests of the
Certificateholders if the Person requesting the amendment obtains a letter
from each Rating Agency stating that the amendment would not result in the
downgrading or withdrawal of the respective ratings then assigned to the
Certificates; it being understood and agreed that any such letter in and of
itself will not represent a determination as to the materiality of any such
amendment and will represent a determination only as to the credit issues
affecting any such rating. Notwithstanding the foregoing, no amendment that
significantly changes the permitted activities of the trust created by this
Agreement may be made without the consent of a Majority in Interest of each
Class of Certificates affected by such amendment. Each party to this Agreement
hereby agrees that it will cooperate with each other party in amending this
Agreement pursuant to clause (v) above. The Trustee, each Seller, the
Depositor and the Master Servicer also may at any time and from time to time
amend this Agreement without the consent of the Certificateholders to modify,
eliminate or add to any of its provisions to such extent as shall be necessary
or helpful to (i) maintain the qualification of any REMIC as a REMIC under the
Code, (ii) avoid or minimize the risk of the imposition of any tax on any
REMIC pursuant to the Code that would be a claim at any time prior to the
final redemption of the Certificates or (iii) comply with any other
requirements of the Code, provided that the Trustee has been provided an
Opinion of Counsel, which opinion shall be an expense of the party requesting
such opinion but in any case shall not be an expense of the Trustee or the
Trust Fund, to the effect that such action is necessary or helpful to, as
applicable, (i) maintain such qualification, (ii) avoid or minimize the risk
of the imposition of such a tax or (iii) comply with any such requirements of
the Code.
This Agreement may also be amended from time to time by the Depositor,
each Seller, the Master Servicer and the Trustee with the consent of the
Holders of a Majority in Interest of each Class of Certificates affected
thereby for the purpose of adding any provisions to or changing in any manner
or eliminating any of the provisions of this Agreement or of modifying in any
manner the rights of the Holders of Certificates; provided, however, that no
such amendment shall (i) reduce in any manner the amount of, or delay the
timing of, payments required to be distributed on any Certificate without the
consent of the Holder of such
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Certificate, (ii) adversely affect in any material respect the interests of
the Holders of any Class of Certificates in a manner other than as described
in (i), without the consent of the Holders of Certificates of such Class
evidencing, as to such Class, Percentage Interests aggregating 66-2/3% or
(iii) reduce the aforesaid percentages of Certificates the Holders of which
are required to consent to any such amendment, without the consent of the
Holders of all such Certificates then outstanding.
Notwithstanding any contrary provision of this Agreement, no amendment
shall adversely affect in any material respect the Swap Counterparty without
the prior written consent of the Swap Counterparty, which consent shall not be
unreasonably withheld. Countrywide shall provide the Swap Counterparty with
prior written notice of any proposed material amendment of this Agreement.
Notwithstanding any contrary provision of this Agreement, the Trustee
shall not consent to any amendment to this Agreement unless it shall have
first received an Opinion of Counsel, which opinion shall not be an expense of
the Trustee or the Trust Fund, to the effect that such amendment will not
cause the imposition of any tax on any REMIC or the Certificateholders or
cause any REMIC to fail to qualify as a REMIC at any time that any
Certificates are outstanding.
Promptly after the execution of any amendment to this Agreement
requiring the consent of Certificateholders, the Trustee shall furnish written
notification of the substance or a copy of such amendment to each
Certificateholder, the Swap Counterparty and each Rating Agency.
It shall not be necessary for the consent of Certificateholders under
this Section to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by Certificateholders shall be subject to such reasonable
regulations as the Trustee may prescribe.
Nothing in this Agreement shall require the Trustee to enter into an
amendment without receiving an Opinion of Counsel (which Opinion shall not be
an expense of the Trustee or the Trust Fund), satisfactory to the Trustee that
(i) such amendment is permitted and is not prohibited by this Agreement and
that all requirements for amending this Agreement have been complied with; and
(ii) either (A) the amendment does not adversely affect in any material
respect the interests of any Certificateholder or (B) the conclusion set forth
in the immediately preceding clause (A) is not required to be reached pursuant
to this Section 10.01.
SECTION 10.02. Recordation of Agreement; Counterparts.
This Agreement is subject to recordation in all appropriate public
offices for real property records in all the counties or other comparable
jurisdictions in which any or all of the properties subject to the Mortgages
are situated, and in any other appropriate public recording office or
elsewhere, such recordation to be effected by the Master Servicer at its
expense, but only upon direction by the Trustee accompanied by an Opinion of
Counsel to the effect that such recordation materially and beneficially
affects the interests of the Certificateholders.
For the purpose of facilitating the recordation of this Agreement as in
this Agreement provided and for other purposes, this Agreement may be executed
simultaneously in any number
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of counterparts, each of which counterparts shall be deemed to be an original,
and such counterparts shall constitute but one and the same instrument.
SECTION 10.03. Governing Law.
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED
BY THE SUBSTANTIVE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE
AND TO BE PERFORMED IN THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HERETO AND THE CERTIFICATEHOLDERS SHALL BE DETERMINED
IN ACCORDANCE WITH SUCH LAWS.
SECTION 10.04. Intention of Parties.
(a) It is the express intent of the parties hereto that the conveyance
of the (i) Mortgage Loans by the Sellers to the Depositor and (ii) Trust Fund
by the Depositor to the Trustee each be, and be construed as, an absolute sale
thereof to the Trustee. It is, further, not the intention of the parties that
such conveyances be deemed a pledge thereof. However, in the event that,
notwithstanding the intent of the parties, such assets are held to be the
property of each Seller or the Depositor, as the case may be, or if for any
other reason this Agreement is held or deemed to create a security interest in
either such assets, then (i) this Agreement shall be deemed to be a security
agreement (within the meaning of the Uniform Commercial Code of the State of
New York) with respect to all such assets and security interests and (ii) the
conveyances provided for in this Agreement shall be deemed to be an assignment
and a grant pursuant to the terms of this Agreement (a) by each Seller to the
Depositor or (b) by the Depositor to the Trustee, for the benefit of the
Certificateholders and the Swap Counterparty, of a security interest in all of
the assets that constitute the Trust Fund, whether now owned or hereafter
acquired.
Each Seller and the Depositor for the benefit of the Certificateholders
and the Swap Counterparty shall, to the extent consistent with this Agreement,
take such actions as may be necessary to ensure that, if this Agreement were
deemed to create a security interest in the Trust Fund, such security interest
would be deemed to be a perfected security interest of first priority under
applicable law and will be maintained as such throughout the term of the
Agreement. The Depositor shall arrange for filing any Uniform Commercial Code
continuation statements in connection with any security interest granted or
assigned to the Trustee for the benefit of the Certificateholders and the Swap
Counterparty.
(b) The Depositor hereby represents that:
(i) This Agreement creates a valid and continuing security
interest (as defined in the Uniform Commercial Code as enacted in the
State of New York (the "NY UCC")) in the Mortgage Notes in favor of the
Trustee, which security interest is prior to all other liens, and is
enforceable as such as against creditors of and purchasers from the
Depositor.
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(ii) The Mortgage Notes constitutes "instruments" within the
meaning of the NY UCC.
(iii) Immediately prior to the assignment of each Mortgage Loan to
the Trustee, the Depositor owns and has good and marketable title to
such Mortgage Loan free and clear of any lien, claim or encumbrance of
any Person.
(iv) The Depositor has received all consents and approvals
required by the terms of the Mortgage Loans to the sale of the Mortgage
Loans hereunder to the Trustee.
(v) All original executed copies of each Mortgage Note that are
required to be delivered to the Trustee pursuant to Section 2.01 have
been delivered to the Trustee.
(vi) Other than the security interest granted to the Trustee
pursuant to this Agreement, the Depositor has not pledged, assigned,
sold, granted a security interest in, or otherwise conveyed any of the
Mortgage Loans. The Depositor has not authorized the filing of and is
not aware of any financing statements against the Depositor that include
a description of collateral covering the Mortgage Loans other than any
financing statement relating to the security interest granted to the
Trustee hereunder or that has been terminated. The Depositor is not
aware of any judgment or tax lien filings against the Depositor.
(c) The Master Servicer shall take such action as is reasonably
necessary to maintain the perfection and priority of the security interest of
the Trustee in the Mortgage Loans; provided, however, that the obligation to
deliver the Mortgage File to the Trustee pursuant to Section 2.01 shall be
solely the Depositor's obligation and the Master Servicer shall not be
responsible for the safekeeping of the Mortgage Files by the Trustee.
(d) It is understood and agreed that the representations and warranties
set forth in subsection (b) above shall survive delivery of the Mortgage Files
to the Trustee. Upon discovery by the Depositor or the Trustee of a breach of
any of the foregoing representations and warranties set forth in subsection
(b) above, which breach materially and adversely affects the interest of the
Certificateholders, the party discovering such breach shall give prompt
written notice to the others and to each Rating Agency.
SECTION 10.05. Notices.
(a) The Trustee shall use its best efforts to promptly provide notice to
each Rating Agency and the Swap Counterparty with respect to each of the
following of which it has actual knowledge:
1. Any material change or amendment to this Agreement;
2. The occurrence of any Event of Default that has not been cured;
3. The resignation or termination of the Master Servicer or the Trustee
and the appointment of any successor;
4. The repurchase or substitution of Mortgage Loans pursuant to Section
2.03;
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5. The final payment to Certificateholders; and
6. Any rating action involving the long-term credit rating of
Countrywide, which notice shall be made by first class mail within two
Business Days after the Trustee gains actual knowledge of such a rating
action.
In addition, the Trustee shall promptly furnish to each Rating Agency
copies of the following:
1. Each report to Certificateholders described in Section 4.06;
2. Each annual statement as to compliance described in Section 3.16;
3. Each annual independent public accountants' servicing report
described in Section 11.07; and
4. Any notice of a purchase of a Mortgage Loan pursuant to Section 2.02,
2.03 or 3.11.
(b) All directions, demands and notices under this Agreement shall be in
writing and shall be deemed to have been duly given when delivered by first
class mail, by courier or by facsimile transmission to (a) in the case of the
Depositor, CWALT, Inc., 0000 Xxxx Xxxxxxx, Xxxxxxxxx, Xxxxxxxxxx 00000,
facsimile number: (000) 000-0000, Attention: Xxxxx X. Xxxxxxx, (b) in the case
of Countrywide, Countrywide Home Loans, Inc., 0000 Xxxx Xxxxxxx, Xxxxxxxxx,
Xxxxxxxxxx 00000, facsimile number: (000) 000-0000, Attention: Xxxxx X.
Xxxxxxx, or such other address as may be hereafter furnished to the Depositor
and the Trustee by Countrywide in writing, (c) in the case of Park Granada,
Park Granada LLC, c/o Countrywide Financial Corporation, 0000 Xxxx Xxxxxxx,
Xxxxxxxxx, Xxxxxxxxxx 00000, facsimile number: (000) 000-0000, Attention:
Xxxxx X. Xxxxxxx or such other address as may be hereafter furnished to the
Depositor and the Trustee by Park Granada in writing, (d) in the case of Park
Monaco Inc., c/o Countrywide Financial Corporation, 0000 Xxxx Xxxxxxx,
Xxxxxxxxx, Xxxxxxxxxx 00000, facsimile number: (000) 000-0000, Attention:
Xxxxx X. Xxxxxxx or such other address as may be hereafter furnished to the
Depositor and the Trustee by Park Monaco in writing, (e) in the case of Park
Sienna LLC, c/o Countrywide Financial Corporation, 0000 Xxxx Xxxxxxx,
Xxxxxxxxx, Xxxxxxxxxx 00000, facsimile number: (000) 000-0000, Attention:
Xxxxx X. Xxxxxxx or such other address as may be hereafter furnished to the
Depositor and the Trustee by Park Sienna in writing, (f) in the case of the
Master Servicer, Countrywide Home Loans Servicing LP, 000 Xxxxxxxxxxx Xxx,
Xxxx Xxxxxx, Xxxxxxxxxx 00000, facsimile number (000) 000-0000, Attention:
Xxxx Xxxx, or such other address as may be hereafter furnished to the
Depositor and the Trustee by the Master Servicer in writing, (g) in the case
of the Trustee, The Bank of New York, 000 Xxxxxxx Xxxxxx, 0X, Xxx Xxxx, Xxx
Xxxx 00000, facsimile number: (000) 000-0000, Attention: Mortgage-Backed
Securities Group, CWALT, Inc. Series 2006-OC1, or such other address as the
Trustee may hereafter furnish to the Depositor or Master Servicer, (h) in the
case of the Rating Agencies, the address specified therefor in the definition
corresponding to the name of such Rating Agency and (i) in the case of the
Swap Counterparty, Bank of America, N.A., 000 X. Xxxxx Xx., Xxxxxxxxx, Xxxxx
Xxxxxxxx 00000, Attention: Capital Markets Documentation, facsimile number
(000) 000-0000, or such other address as may be hereafter furnished by the
Swap Counterparty.
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Notices to Certificateholders shall be deemed given when mailed, first class
postage prepaid, to their respective addresses appearing in the Certificate
Register.
SECTION 10.06. Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall be for any reason whatsoever held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and
shall in no way affect the validity or enforceability of the other provisions
of this Agreement or of the Certificates or the rights of the Holders of the
Certificates.
SECTION 10.07. Assignment.
Notwithstanding anything to the contrary contained in this Agreement,
except as provided in Section 6.02, this Agreement may not be assigned by the
Master Servicer without the prior written consent of the Trustee and the
Depositor.
SECTION 10.08. Limitation on Rights of Certificateholders.
The death or incapacity of any Certificateholder shall not operate to
terminate this Agreement or the trust created hereby, nor entitle such
Certificateholder's legal representative or heirs to claim an accounting or to
take any action or commence any proceeding in any court for a petition or
winding up of the trust created by this Agreement, or otherwise affect the
rights, obligations and liabilities of the parties hereto or any of them.
No Certificateholder shall have any right to vote (except as provided in
this Agreement) or in any manner otherwise control the operation and
management of the Trust Fund, or the obligations of the parties hereto, nor
shall anything set forth in this Agreement or contained in the terms of the
Certificates be construed so as to constitute the Certificateholders from time
to time as partners or members of an association; nor shall any
Certificateholder be under any liability to any third party by reason of any
action taken by the parties to this Agreement pursuant to any provision of
this Agreement.
No Certificateholder shall have any right by virtue or by availing
itself of any provisions of this Agreement to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this
Agreement, unless such Holder previously shall have given to the Trustee a
written notice of an Event of Default and of the continuance thereof, as
provided in this Agreement, and unless the Holders of Certificates evidencing
not less than 25% of the Voting Rights evidenced by the Certificates shall
also have made written request to the Trustee to institute such action, suit
or proceeding in its own name as Trustee hereunder and shall have offered to
the Trustee such reasonable indemnity as it may require against the costs,
expenses, and liabilities to be incurred therein or thereby, and the Trustee,
for 60 days after its receipt of such notice, request and offer of indemnity
shall have neglected or refused to institute any such action, suit or
proceeding; it being understood and intended, and being expressly covenanted
by each Certificateholder with every other Certificateholder and the Trustee,
that no one or more Holders of Certificates shall have any right in any manner
whatever by virtue or by availing itself or themselves of any provisions of
this Agreement to affect, disturb or prejudice the rights of the Holders of
any other of the Certificates, or to obtain or seek to obtain priority over or
preference
125
to any other such Holder or to enforce any right under this Agreement, except
in the manner provided in this Agreement and for the common benefit of all
Certificateholders. For the protection and enforcement of the provisions of
this Section 10.08, each and every Certificateholder and the Trustee shall be
entitled to such relief as can be given either at law or in equity.
SECTION 10.09. Inspection and Audit Rights.
The Master Servicer agrees that, on reasonable prior notice, it will
permit and will cause each Subservicer to permit any representative of the
Depositor or the Trustee during the Master Servicer's normal business hours,
to examine all the books of account, records, reports and other papers of the
Master Servicer relating to the Mortgage Loans, to make copies and extracts
therefrom, to cause such books to be audited by independent certified public
accountants selected by the Depositor or the Trustee and to discuss its
affairs, finances and accounts relating to the Mortgage Loans with its
officers, employees and independent public accountants (and by this provision
the Master Servicer hereby authorizes said accountants to discuss with such
representative such affairs, finances and accounts), all at such reasonable
times and as often as may be reasonably requested. Any out-of-pocket expense
incident to the exercise by the Depositor or the Trustee of any right under
this Section 10.09 shall be borne by the party requesting such inspection; all
other such expenses shall be borne by the Master Servicer or the related
Subservicer.
SECTION 10.10. Certificates Nonassessable and Fully Paid.
It is the intention of the Depositor that Certificateholders shall not
be personally liable for obligations of the Trust Fund, that the interests in
the Trust Fund represented by the Certificates shall be nonassessable for any
reason whatsoever, and that the Certificates, upon due authentication thereof
by the Trustee pursuant to this Agreement, are and shall be deemed fully paid.
SECTION 10.11. [Reserved].
SECTION 10.12. Protection of Assets.
(a) Except for transactions and activities entered into in connection
with the securitization that is the subject of this Agreement, the Trust Fund
created by this Agreement is not authorized and has no power to:
(i) borrow money or issue debt;
(ii) merge with another entity, reorganize, liquidate or sell
assets; or
(iii) engage in any business or activities.
(b) Each party to this Agreement agrees that it will not file an
involuntary bankruptcy petition against the Trustee or the Trust Fund or
initiate any other form of insolvency proceeding until after the Certificates
have been paid.
SECTION 10.13. Rights of NIM Insurer
126
(a) The rights of the NIM Insurer under this Agreement shall exist only
so long as either:
(1) the notes certain, payments on which are guaranteed by the NIM
Insurer, remain outstanding or
(2) the NIM Insurer is owed amounts paid by it with respect to
that guaranty.
(b) The rights of the NIM Insurer under this Agreement are exercisable
by the NIM Insurer only so long as no default by the NIM Insurer under its
guaranty of certain payments under notes backed or secured by the Class C or
Class P Certificates has occurred and is continuing. If the NIM Insurer is the
subject of any insolvency proceeding, the rights of the NIM Insurer under this
Agreement will be exercisable by the NIM Insurer only so long as:
(1) the obligations of the NIM Insurer under its guaranty of notes
backed or secured by the Class C or Class P Certificates have not been
disavowed and
(2) Countrywide and the Trustee have received reasonable
assurances that the NIM Insurer will be able to satisfy its obligations
under its guaranty of notes backed or secured by the Class C or Class P
Certificates.
(c) The NIM Insurer is a third party beneficiary of this Agreement to
the same extent as if it were a party to this Agreement and may enforce any of
those rights under this Agreement.
(d) A copy of any documents of any nature required by this Agreement to
be delivered by the Trustee, or to the Trustee or the Rating Agencies, shall
in each case at the same time also be delivered to the NIM Insurer. Any
notices required to be given by the Trustee, or to the Trustee or the Rating
Agencies, shall in each case at the same time also be given to the NIM
Insurer. If the Trustee receives a notice or document that is required
hereunder to be delivered to the NIM Insurer, and if such notice or document
does not indicate that a copy thereof has been previously sent to the NIM
Insurer, the Trustee shall send the NIM Insurer a copy of such notice or
document. If such document is an Opinion of Counsel, the NIM Insurer shall be
an addressee thereof or such Opinion of Counsel shall contain language
permitting the NIM Insurer to rely thereon as if the NIM Insurer were an
addressee thereof.
(e) Anything in this Agreement that is conditioned on not resulting in
the downgrading or withdrawal of the ratings then assigned to the Certificates
by the Rating Agencies shall also be conditioned on not resulting in the
downgrading or withdrawal of the ratings then assigned by the Rating Agencies
to the notes backed or secured by the Class C or Class P Certificates (without
giving effect to any policy or guaranty provided by the NIM Insurer).
ARTICLE XI
EXCHANGE ACT REPORTING
SECTION 11.01. Filing Obligations.
The Master Servicer, the Trustee and each Seller shall reasonably
cooperate with the Depositor in connection with the satisfaction of the
Depositor's reporting requirements under the
127
Exchange Act with respect to the Trust Fund. In addition to the information
specified below, if so requested by the Depositor for the purpose of
satisfying its reporting obligation under the Exchange Act, the Master
Servicer, the Trustee and each Seller shall (and the Master Servicer shall
cause each Subservicer to) provide the Depositor with (a) such information
which is available to such Person without unreasonable effort or expense and
within such timeframe as may be reasonably requested by the Depositor to
comply with the Depositor's reporting obligations under the Exchange Act and
(b) to the extent such Person is a party (and the Depositor is not a party) to
any agreement or amendment required to be filed, copies of such agreement or
amendment in XXXXX-compatible form.
SECTION 11.02. Form 10-D Filings.
(a) In accordance with the Exchange Act, the Trustee shall prepare for
filing and file within 15 days after each Distribution Date (subject to
permitted extensions under the Exchange Act) with the Commission with respect
to the Trust Fund, a Form 10-D with copies of the Monthly Statement and, to
the extent delivered to the Trustee, no later than 10 days following the
Distribution Date, such other information identified by the Depositor or the
Master Servicer, in writing, to be filed with the Commission (such other
information, the "Additional Designated Information"). If the Depositor or
Master Servicer directs that any Additional Designated Information is to be
filed with any Form 10-D, the Depositor or Master Servicer, as the case may
be, shall specify the Item on Form 10-D to which such information is
responsive and, with respect to any Exhibit to be filed on Form 10-D, the
Exhibit number. Any information to be filed on Form 10-D shall be delivered to
the Trustee in XXXXX-compatible form or as otherwise agreed upon by the
Trustee and the Depositor or the Master Servicer, as the case may be, at the
Depositor's expense, and any necessary conversion to XXXXX-compatible format
will be at the Depositor's expense. At the reasonable request of, and in
accordance with the reasonable directions of, the Depositor or the Master
Servicer, subject to the two preceding sentences, the Trustee shall prepare
for filing and file an amendment to any Form 10-D previously filed with the
Commission with respect to the Trust Fund. The Master Servicer shall sign the
Form 10-D filed on behalf of the Trust Fund.
(b) No later than each Distribution Date, each of the Master Servicer
and the Trustee shall notify (and the Master Servicer shall cause any
Subservicer to notify) the Depositor and the Master Servicer of any Form 10-D
Disclosure Item, together with a description of any such Form 10-D Disclosure
Item in form and substance reasonably acceptable to the Depositor. In addition
to such information as the Master Servicer and the Trustee are obligated to
provide pursuant to other provisions of this Agreement, if so requested by the
Depositor, each of the Master Servicer and the Trustee shall provide such
information which is available to the Master Servicer and the Trustee, as
applicable, without unreasonable effort or expense regarding the performance
or servicing of the Mortgage Loans (in the case of the Trustee, based on the
information provided by the Master Servicer) as is reasonably required to
facilitate preparation of distribution reports in accordance with Item 1121 of
Regulation AB. Such information shall be provided concurrently with the
delivery of the reports specified in Section 4.06(c) in the case of the Master
Servicer and the Monthly Statement in the case of the Trustee, commencing with
the first such report due not less than five Business Days following such
request.
(c) The Trustee shall not have any responsibility to file any items
(other than those generated by it) that have not been received in a format
suitable (or readily convertible into a
128
format suitable) for electronic filing via the XXXXX system and shall not have
any responsibility to convert any such items to such format (other than those
items generated by it or that are readily convertible to such format). The
Trustee shall have no liability to the Certificateholders, the Trust Fund, the
Master Servicer, the Depositor or the NIM Insurer with respect to any failure
to properly prepare or file any of Form 10-D to the extent that such failure
is not the result of any negligence, bad faith or willful misconduct on its
part.
SECTION 11.03. Form 8-K Filings.
The Master Servicer shall prepare and file on behalf of the Trust Fund
any Form 8-K required by the Exchange Act. Each Form 8-K must be signed by the
Master Servicer. Each of the Master Servicer (and the Master Servicer shall
cause any Subservicer to promptly notify), and the Trustee shall promptly
notify the Depositor and the Master Servicer (if the notifying party is not
the Master Servicer), but in no event later than one (1) Business Day after
its occurrence, of any Reportable Event of which it has actual knowledge. Each
Person shall be deemed to have actual knowledge of any such event to the
extent that it relates to such Person or any action or failure to act by such
Person. Concurrently with any Supplemental Transfer, Countrywide shall notify
the Depositor and the Master Servicer, if any material pool characteristic of
the actual asset pool at the time of issuance of the Certificates differs by
5% or more (other than as a result of the pool assets converting into cash in
accordance with their terms) from the description of the asset pool in the
Prospectus Supplement.
SECTION 11.04. Form 10-K Filings.
Prior to March 30th of each year, commencing in 2007 (or such earlier
date as may be required by the Exchange Act), the Depositor shall prepare and
file on behalf of the Trust Fund a Form 10-K, in form and substance as
required by the Exchange Act. A senior officer in charge of the servicing
function of the Master Servicer shall sign each Form 10-K filed on behalf of
the Trust Fund. Such Form 10-K shall include as exhibits each (i) annual
compliance statement described under Section 3.16, (ii) annual report on
assessments of compliance with servicing criteria described under Section
11.07 and (iii) accountant's report described under Section 11.07. Each Form
10-K shall also include any Xxxxxxxx-Xxxxx Certification required to be
included therewith, as described in Section 11.05.
If the Item 1119 Parties listed on Exhibit X have changed since the
Closing Date, no later than March 1 of each year, the Master Servicer shall
provide each of the Master Servicer (and the Master Servicer shall provide any
Subservicer) and the Trustee with an updated Exhibit X setting forth the Item
1119 Parties. No later than March 15 of each year, commencing in 2007, the
Master Servicer and the Trustee shall notify (and the Master Servicer shall
cause any Subservicer to notify) the Depositor and the Master Servicer of any
Form 10-K Disclosure Item, together with a description of any such Form 10-K
Disclosure Item in form and substance reasonably acceptable to the Depositor.
Additionally, each of the Master Servicer and the Trustee shall provide, and
shall cause each Reporting Subcontractor retained by the Master Servicer or
the Trustee, as applicable, and in the case of the Master Servicer shall cause
each Subservicer, to provide, the following information no later than March 15
of each year in which a Form 10-K is required to be filed on behalf of the
Trust Fund: (i) if such Person's report on assessment of compliance with
servicing criteria described under Section 11.07 or related registered public
accounting firm attestation report described under Section 11.07 identifies
any material instance
129
of noncompliance, notification of such instance of noncompliance and (ii) if
any such Person's report on assessment of compliance with the Servicing
Criteria or related registered public accounting firm attestation report is
not provided to be filed as an exhibit to such Form 10-K, information
detailing the explanation why such report is not included.
SECTION 11.05. Xxxxxxxx-Xxxxx Certification.
Each Form 10-K shall include a certification (the "Xxxxxxxx-Xxxxx
Certification") required by Rules 13a-14(d) and 15d-14(d) under the Exchange
Act (pursuant to Section 302 of the Xxxxxxxx-Xxxxx Act of 2002 and the rules
and regulations of the Commission promulgated thereunder (including any
interpretations thereof by the Commission's staff)). No later than March 15 of
each year, beginning in 2007, the Master Servicer and the Trustee shall
(unless such person is the Certifying Person), and the Master Servicer shall
cause each Subservicer to, provide to the Person who signs the Xxxxxxxx-Xxxxx
Certification (the "Certifying Person") a certification (each, a "Performance
Certification"), in the form attached hereto as Exhibit V-1 (in the case of a
Subservicer) and Exhibit V-2 (in the case of the Trustee), on which the
Certifying Person, the entity for which the Certifying Person acts as an
officer, and such entity's officers, directors and Affiliates (collectively
with the Certifying Person, "Certification Parties") can reasonably rely. The
senior officer in charge of the servicing function of the Master Servicer
shall serve as the Certifying Person on behalf of the Trust Fund. Neither the
Master Servicer nor the Depositor will request delivery of a certification
under this clause unless the Depositor is required under the Exchange Act to
file an annual report on Form 10-K with respect to the Trust Fund. In the
event that prior to the filing date of the Form 10-K in March of each year,
the Trustee or the Depositor has actual knowledge of information material to
the Xxxxxxxx-Xxxxx Certification, the Trustee or the Depositor, as the case
may be, shall promptly notify the Master Servicer and the Depositor. The
respective parties hereto agree to cooperate with all reasonable requests made
by any Certifying Person or Certification Party in connection with such
Person's attempt to conduct any due diligence that such Person reasonably
believes to be appropriate in order to allow it to deliver any Xxxxxxxx-Xxxxx
Certification or portion thereof with respect to the Trust Fund.
SECTION 11.06. Form 15 Filing.
Prior to January 30 of the first year in which the Depositor is able to
do so under applicable law, the Depositor shall file a Form 15 relating to the
automatic suspension of reporting in respect of the Trust Fund under the
Exchange Act.
SECTION 11.07. Report on Assessment of Compliance and Attestation.
(a) On or before March 15 of each calendar year, commencing in 2007:
(1) Each of the Master Servicer and the Trustee shall deliver to the
Depositor and the Master Servicer a report (in form and substance reasonably
satisfactory to the Depositor) regarding the Master Servicer's or the
Trustee's, as applicable, assessment of compliance with the Servicing Criteria
during the immediately preceding calendar year, as required under Rules 13a-18
and 15d-18 of the Exchange Act and Item 1122 of Regulation AB. Such report
shall be signed by an authorized officer of such Person and shall address each
of the Servicing Criteria specified on a certification substantially in the
form of Exhibit W hereto delivered to the
130
Depositor concurrently with the execution of this Agreement. To the extent any
of the Servicing Criteria are not applicable to such Person, with respect to
asset-backed securities transactions taken as a whole involving such Person
and that are backed by the same asset type backing the Certificates, such
report shall include such a statement to that effect. The Depositor and the
Master Servicer, and each of their respective officers and directors shall be
entitled to rely on upon each such servicing criteria assessment.
(2) Each of the Master Servicer and the Trustee shall deliver to the
Depositor and the Master Servicer a report of a registered public accounting
firm reasonably acceptable to the Depositor that attests to, and reports on,
the assessment of compliance made by Master Servicer or the Trustee, as
applicable, and delivered pursuant to the preceding paragraphs. Such
attestation shall be in accordance with Rules 1-02(a)(3) and 2-02(g) of
Regulation S-X under the Securities Act and the Exchange Act, including,
without limitation that in the event that an overall opinion cannot be
expressed, such registered public accounting firm shall state in such report
why it was unable to express such an opinion. Such report must be available
for general use and not contain restricted use language. To the extent any of
the Servicing Criteria are not applicable to such Person, with respect to
asset-backed securities transactions taken as a whole involving such Person
and that are backed by the same asset type backing the Certificates, such
report shall include such a statement that that effect.
(3) The Master Servicer shall cause each Subservicer and each Reporting
Subcontractor to deliver to the Depositor an assessment of compliance and
accountant's attestation as and when provided in paragraphs (a) and (b) of
this Section 11.07.
(4) The Trustee shall cause each Reporting Subcontractor to deliver to
the Depositor and the Master Servicer an assessment of compliance and
accountant's attestation as and when provided in paragraphs (a) and (b) of
this Section.
(5) The Master Servicer and the Trustee shall execute (and the Master
Servicer shall cause each Subservicer to execute, and the Master Servicer and
the Trustee shall cause each Reporting Subcontractor to execute) a reliance
certificate to enable the Certification Parties to rely upon each (i) annual
compliance statement provided pursuant to Section 3.16, (ii) annual report on
assessments of compliance with servicing criteria provided pursuant to this
Section 11.07 and (iii) accountant's report provided pursuant to this Section
11.07 and shall include a certification that each such annual compliance
statement or report discloses any deficiencies or defaults described to the
registered public accountants of such Person to enable such accountants to
render the certificates provided for in this Section 11.07. In the event the
Master Servicer, any Subservicer, the Trustee or Reporting Subcontractor is
terminated or resigns during the term of this Agreement, such Person shall
provide a certification to the Certifying Person pursuant to this Section
11.07 with respect to the period of time it was subject to this Agreement or
provided services with respect to the Trust Fund, the Certificates or the
Mortgage Loans.
(b) In the event the Master Servicer, any Subservicer, the Trustee or
Reporting Subcontractor is terminated or resigns during the term of this
Agreement, such Person shall provide documents and information required by
this Section 11.07 with respect to the period of time it was subject to this
Agreement or provided services with respect to the Trust Fund, the
Certificates or the Mortgage Loans.
131
(c) Each assessment of compliance provided by a Subservicer pursuant to
Section 11.07(a)(3) shall address each of the Servicing Criteria specified on
a certification substantially in the form of Exhibit W hereto delivered to the
Depositor concurrently with the execution of this Agreement or, in the case of
a Subservicer subsequently appointed as such, on or prior to the date of such
appointment. An assessment of compliance provided by a Subcontractor pursuant
to Section 11.07(a)(3) or (4) need not address any elements of the Servicing
Criteria other than those specified by the Master Servicer or the Trustee, as
applicable, pursuant to Section 11.07(a)(1).
SECTION 11.08. Use of Subservicers and Subcontractors.
(a) The Master Servicer shall cause any Subservicer used by the Master
Servicer (or by any Subservicer) for the benefit of the Depositor to comply
with the provisions of Section 3.16 and this Article XI to the same extent as
if such Subservicer were the Master Servicer (except with respect to the
Master Servicer's duties with respect to preparing and filing any Exchange Act
Reports or as the Certifying Person). The Master Servicer shall be responsible
for obtaining from each Subservicer and delivering to the Depositor any
servicer compliance statement required to be delivered by such Subservicer
under Section 3.16, any assessment of compliance and attestation required to
be delivered by such Subservicer under Section 11.07 and any certification
required to be delivered to the Certifying Person under Section 11.05 as and
when required to be delivered. As a condition to the succession to any
Subservicer as subservicer under this Agreement by any Person (i) into which
such Subservicer may be merged or consolidated, or (ii) which may be appointed
as a successor to any Subservicer, the Master Servicer shall provide to the
Depositor, at least 15 calendar days prior to the effective date of such
succession or appointment, (x) written notice to the Depositor of such
succession or appointment and (y) in writing and in form and substance
reasonably satisfactory to the Depositor, all information reasonably requested
by the Depositor in order to comply with its reporting obligation under Item
6.02 of Form 8-K.
(b) It shall not be necessary for the Master Servicer, any Subservicer
or the Trustee to seek the consent of the Depositor or any other party hereto
to the utilization of any Subcontractor. The Master Servicer or the Trustee,
as applicable, shall promptly upon request provide to the Depositor (or any
designee of the Depositor, such as the Master Servicer or administrator) a
written description (in form and substance satisfactory to the Depositor) of
the role and function of each Subcontractor utilized by such Person (or in the
case of the Master Servicer or any Subservicer), specifying (i) the identity
of each such Subcontractor, (ii) which (if any) of such Subcontractors are
"participating in the servicing function" within the meaning of Item 1122 of
Regulation AB, and (iii) which elements of the Servicing Criteria will be
addressed in assessments of compliance provided by each Subcontractor
identified pursuant to clause (ii) of this paragraph.
As a condition to the utilization of any Subcontractor determined to be
a Reporting Subcontractor, the Master Servicer or the Trustee, as applicable,
shall cause any such Subcontractor used by such Person (or in the case of the
Master Servicer or any Subservicer) for the benefit of the Depositor to comply
with the provisions of Sections 11.07 and 11.09 of this Agreement to the same
extent as if such Subcontractor were the Master Servicer (except with respect
to the Master Servicer's duties with respect to preparing and filing any
Exchange Act Reports or as the Certifying Person) or the Trustee, as
applicable. The Master Servicer or the
132
Trustee, as applicable, shall be responsible for obtaining from each
Subcontractor and delivering to the Depositor and the Master Servicer, any
assessment of compliance and attestation required to be delivered by such
Subcontractor under Section 11.05 and Section 11.07, in each case as and when
required to be delivered.
SECTION 11.09. Amendments.
In the event the parties to this Agreement desire to further clarify or
amend any provision of this Article XI, this Agreement shall be amended to
reflect the new agreement between the parties covering matters in this Article
XI pursuant to Section 10.01, which amendment shall not require any Opinion of
Counsel or Rating Agency confirmations or the consent of any Certificateholder
or the NIM Insurer. If, during the period that the Depositor is required to
file Exchange Act Reports with respect to the Trust Fund, the Master Servicer
is no longer an Affiliate of the Depositor, the Depositor shall assume the
obligations and responsibilities of the Master Servicer in this Article XI
with respect to the preparation and filing of the Exchange Act Reports and/or
acting as the Certifying Person, if the Depositor has received indemnity from
such successor Master Servicer satisfactory to the Depositor, and such Master
Servicer has agreed to provide a Xxxxxxxx-Xxxxx Certification to the Depositor
substantially in the form of Exhibit Y and the certifications referred to in
Section 11.07.
* * * * * *
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IN WITNESS WHEREOF, the Depositor, the Trustee, the Sellers and the
Master Servicer have caused their names to be signed hereto by their
respective officers thereunto duly authorized as of the day and year first
above written.
CWALT, INC.,
as Depositor
By: /s/ Xxxxxxx Xxxxxxxxxxxx
---------------------------------------
Name: Xxxxxxx Xxxxxxxxxxxx
Title: Vice President
THE BANK OF NEW YORK,
as Trustee
By: /s/ Xxxxxx Xxxxxxxx
---------------------------------------
Name: Xxxxxx Xxxxxxxx
Title: Assistant Vice President
COUNTRYWIDE HOME LOANS, INC.,
as a Seller
By: /s/ Xxxxxxx Xxxxxxxxxxxx
---------------------------------------
Name: Xxxxxxx Xxxxxxxxxxxx
Title: Senior Vice President
PARK GRANADA LLC,
as a Seller
By: /s/ Xxxxxxx Xxxxxxxxxxxx
---------------------------------------
Name: Xxxxxxx Xxxxxxxxxxxx
Title: Assistant Vice President
1
PARK MONACO INC.,
as a Seller
By: /s/ Xxxxxxx Xxxxxxxxxxxx
---------------------------------------
Name: Xxxxxxx Xxxxxxxxxxxx
Title: Vice President
PARK SIENNA LLC,
as a Seller
By: /s/ Xxxxxxx Xxxxxxxxxxxx
---------------------------------------
Name: Xxxxxxx Xxxxxxxxxxxx
Title: Assistant Vice President
COUNTRYWIDE HOME LOANS SERVICING LP,
as Master Servicer
By: COUNTRYWIDE GP, INC.
By: /s/ Xxxxxxx Xxxxxxxxxxxx
---------------------------------------
Name: Xxxxxxx Xxxxxxxxxxxx
Title: Senior Vice President
Acknowledged solely with respect to the Trustee's
obligations under Section 4.01(b):
THE BANK OF NEW YORK, in its individual capacity
By: /s/ Xxxx Xxxxxxxx
---------------------------------------
Name: Xxxx Connnolly
Title: Vice President
SCHEDULE I
Mortgage Loan Schedule
[Delivered at Closing to Trustee]
S-I-1
SCHEDULE II-A
CWALT, Inc.
Mortgage Pass-Through Certificates
Series 2006-OC1
Representations and Warranties of Countrywide
---------------------------------------------
Countrywide Home Loans, Inc. ("Countrywide") hereby makes the
representations and warranties set forth in this Schedule II-A to the
Depositor, the Master Servicer and the Trustee, as of the Closing Date.
Capitalized terms used but not otherwise defined in this Schedule II-A shall
have the meanings ascribed thereto in the Pooling and Servicing Agreement (the
"Pooling and Servicing Agreement") relating to the above-referenced Series,
among Countrywide Home Loans, Inc., as a seller, Park Granada LLC, as a
seller, Park Monaco Inc., as a seller, Park Sienna LLC, as a seller, CWALT,
Inc., as depositor, Countrywide Home Loans Servicing LP, as master servicer
and The Bank of New York, as trustee.
(1) Countrywide is duly organized as a New York corporation
and is validly existing and in good standing under the laws of the State
of New York and is duly authorized and qualified to transact any and all
business contemplated by the Pooling and Servicing Agreement to be
conducted by Countrywide in any state in which a Mortgaged Property is
located or is otherwise not required under applicable law to effect such
qualification and, in any event, is in compliance with the doing
business laws of any such state, to the extent necessary to perform any
of its obligations under the Pooling and Servicing Agreement in
accordance with the terms thereof.
(2) Countrywide has the full corporate power and authority
to sell each Countrywide Mortgage Loan, and to execute, deliver and
perform, and to enter into and consummate the transactions contemplated
by the Pooling and Servicing Agreement and has duly authorized by all
necessary corporate action on the part of Countrywide the execution,
delivery and performance of the Pooling and Servicing Agreement; and the
Pooling and Servicing Agreement, assuming the due authorization,
execution and delivery thereof by the other parties thereto, constitutes
a legal, valid and binding obligation of Countrywide, enforceable
against Countrywide in accordance with its terms, except that (a) the
enforceability thereof may be limited by bankruptcy, insolvency,
moratorium, receivership and other similar laws relating to creditors'
rights generally and (b) the remedy of specific performance and
injunctive and other forms of equitable relief may be subject to
equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought.
(3) The execution and delivery of the Pooling and Servicing
Agreement by Countrywide , the sale of the Countrywide Mortgage Loans by
Countrywide under the Pooling and Servicing Agreement, the consummation
of any other of the transactions contemplated by the Pooling and
Servicing Agreement, and the fulfillment of or compliance with the terms
thereof are in the ordinary course of business of Countrywide and will
not (A) result in a material breach of any term or provision of the
charter or by-
S-II-A-1
laws of Countrywide or (B) materially conflict with, result in a
material breach, violation or acceleration of, or result in a material
default under, the terms of any other material agreement or instrument
to which Countrywide is a party or by which it may be bound, or (C)
constitute a material violation of any statute, order or regulation
applicable to Countrywide of any court, regulatory body, administrative
agency or governmental body having jurisdiction over Countrywide; and
Countrywide is not in breach or violation of any material indenture or
other material agreement or instrument, or in violation of any statute,
order or regulation of any court, regulatory body, administrative agency
or governmental body having jurisdiction over it which breach or
violation may materially impair Countrywide's ability to perform or meet
any of its obligations under the Pooling and Servicing Agreement.
(4) Countrywide is an approved servicer of conventional
mortgage loans for FNMA or FHLMC and is a mortgagee approved by the
Secretary of Housing and Urban Development pursuant to Sections 203 and
211 of the National Housing Act.
(5) No litigation is pending or, to the best of
Countrywide's knowledge, threatened, against Countrywide that would
materially and adversely affect the execution, delivery or
enforceability of the Pooling and Servicing Agreement or the ability of
Countrywide to sell the Countrywide Mortgage Loans or to perform any of
its other obligations under the Pooling and Servicing Agreement in
accordance with the terms thereof.
(6) No consent, approval, authorization or order of any
court or governmental agency or body is required for the execution,
delivery and performance by Countrywide of, or compliance by Countrywide
with, the Pooling and Servicing Agreement or the consummation of the
transactions contemplated thereby, or if any such consent, approval,
authorization or order is required, Countrywide has obtained the same.
(7) Countrywide intends to treat the transfer of the
Countrywide Mortgage Loans to the Depositor as a sale of the Countrywide
Mortgage Loans for all tax, accounting and regulatory purposes.
(8) Countrywide is a member of MERS in good standing, and
will comply in all material respects with the rules and procedures of
MERS in connection with the servicing of the MERS Mortgage Loans in the
Trust Fund for as long as such Mortgage Loans are registered with MERS.
S-II-A-2
SCHEDULE II-B
CWALT, Inc.
Mortgage Pass-Through Certificates
Series 2006-OC1
Representations and Warranties of Park Granada
----------------------------------------------
Park Granada LLC ("Park Granada") and Countrywide Home Loans, Inc.
("Countrywide"), each hereby makes the representations and warranties set
forth in this Schedule II-B to the Depositor, the Master Servicer and the
Trustee, as of the Closing Date. Capitalized terms used but not otherwise
defined in this Schedule II-B shall have the meanings ascribed thereto in the
Pooling and Servicing Agreement (the "Pooling and Servicing Agreement")
relating to the above-referenced Series, among Park Granada, as a seller, Park
Monaco Inc., as a seller, Park Sienna LLC, as a seller, Countrywide Home
Loans, Inc., as a seller, Countrywide Home Loans Servicing LP, as master
servicer, CWALT, Inc., as depositor, and The Bank of New York, as trustee.
(1) Park Granada is a limited liability company duly formed and validly
existing and in good standing under the laws of the State of Delaware.
(2) Park Granada has the full corporate power and authority to sell each
Park Granada Mortgage Loan, and to execute, deliver and perform, and to enter
into and consummate the transactions contemplated by the Pooling and Servicing
Agreement and has duly authorized by all necessary corporate action on the
part of Park Granada the execution, delivery and performance of the Pooling
and Servicing Agreement; and the Pooling and Servicing Agreement, assuming the
due authorization, execution and delivery thereof by the other parties
thereto, constitutes a legal, valid and binding obligation of Park Granada,
enforceable against Park Granada in accordance with its terms, except that (a)
the enforceability thereof may be limited by bankruptcy, insolvency,
moratorium, receivership and other similar laws relating to creditors' rights
generally and (b) the remedy of specific performance and injunctive and other
forms of equitable relief may be subject to equitable defenses and to the
discretion of the court before which any proceeding therefor may be brought.
(3) The execution and delivery of the Pooling and Servicing Agreement by
Park Granada, the sale of the Park Granada Mortgage Loans by Park Granada
under the Pooling and Servicing Agreement, the consummation of any other of
the transactions contemplated by the Pooling and Servicing Agreement, and the
fulfillment of or compliance with the terms thereof are in the ordinary course
of business of Park Granada and will not (A) result in a material breach of
any term or provision of the certificate of formation or the limited liability
company agreement of Park Granada or (B) materially conflict with, result in a
material breach, violation or acceleration of, or result in a material default
under, the terms of any other material agreement or instrument to which Park
Granada is a party or by which it may be bound, or (C) constitute a material
violation of any statute, order or regulation applicable to Park Granada of
any court, regulatory body, administrative agency or governmental body having
jurisdiction over Park Granada; and Park Granada is not in breach or violation
of any material indenture or other
S-II-B-1
material agreement or instrument, or in violation of any statute, order or
regulation of any court, regulatory body, administrative agency or
governmental body having jurisdiction over it which breach or violation may
materially impair Park Granada's ability to perform or meet any of its
obligations under the Pooling and Servicing Agreement.
(4) No litigation is pending or, to the best of Park Granada's
knowledge, threatened, against Park Granada that would materially and
adversely affect the execution, delivery or enforceability of the Pooling and
Servicing Agreement or the ability of Park Granada to sell the Park Granada
Mortgage Loans or to perform any of its other obligations under the Pooling
and Servicing Agreement in accordance with the terms thereof.
(5) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by Park Granada of, or compliance by Park Granada with, the
Pooling and Servicing Agreement or the consummation of the transactions
contemplated thereby, or if any such consent, approval, authorization or order
is required, Park Granada has obtained the same.
(6) Park Granada intends to treat the transfer of the Park Granada
Mortgage Loans to the Depositor as a sale of the Park Granada Mortgage Loans
for all tax, accounting and regulatory purposes.
S-II-B-2
SCHEDULE II-C
CWALT, Inc.
Mortgage Pass-Through Certificates
Series 2006-OC1
Representations and Warranties of Park Monaco
---------------------------------------------
Park Monaco Inc. ("Park Monaco") and Countrywide Home Loans, Inc.
("Countrywide"), each hereby makes the representations and warranties set
forth in this Schedule II-C to the Depositor, the Master Servicer and the
Trustee, as of the Closing Date. Capitalized terms used but not otherwise
defined in this Schedule II-C shall have the meanings ascribed thereto in the
Pooling and Servicing Agreement (the "Pooling and Servicing Agreement")
relating to the above-referenced Series, among Park Monaco, as a seller,
Countrywide, as a seller, Park Granada LLC, as a seller, Park Sienna LLC, as a
seller, Countrywide Home Loans Servicing LP, as master servicer, CWALT, Inc.,
as depositor, and The Bank of New York, as trustee.
(1) Park Monaco is a corporation duly formed and validly existing and in
good standing under the laws of the State of Delaware.
(2) Park Monaco has the full corporate power and authority to sell each
Park Monaco Mortgage Loan, and to execute, deliver and perform, and to enter
into and consummate the transactions contemplated by the Pooling and Servicing
Agreement and has duly authorized by all necessary corporate action on the
part of Park Monaco the execution, delivery and performance of the Pooling and
Servicing Agreement; and the Pooling and Servicing Agreement, assuming the due
authorization, execution and delivery thereof by the other parties thereto,
constitutes a legal, valid and binding obligation of Park Monaco, enforceable
against Park Monaco in accordance with its terms, except that (a) the
enforceability thereof may be limited by bankruptcy, insolvency, moratorium,
receivership and other similar laws relating to creditors' rights generally
and (b) the remedy of specific performance and injunctive and other forms of
equitable relief may be subject to equitable defenses and to the discretion of
the court before which any proceeding therefor may be brought.
(3) The execution and delivery of the Pooling and Servicing Agreement by
Park Monaco, the sale of the Park Monaco Mortgage Loans by Park Monaco under
the Pooling and Servicing Agreement, the consummation of any other of the
transactions contemplated by the Pooling and Servicing Agreement, and the
fulfillment of or compliance with the terms thereof are in the ordinary course
of business of Park Monaco and will not (A) result in a material breach of any
term or provision of the charter or by-laws of Park Monaco or (B) materially
conflict with, result in a material breach, violation or acceleration of, or
result in a material default under, the terms of any other material agreement
or instrument to which Park Monaco is a party or by which it may be bound, or
(C) constitute a material violation of any statute, order or regulation
applicable to Park Monaco of any court, regulatory body, administrative agency
or governmental body having jurisdiction over Park Monaco; and Park Monaco is
not in breach or violation of any material indenture or other material
agreement or instrument, or in violation of any statute,
S-II-C-1
order or regulation of any court, regulatory body, administrative agency or
governmental body having jurisdiction over it which breach or violation may
materially impair Park Monaco's ability to perform or meet any of its
obligations under the Pooling and Servicing Agreement.
(4) No litigation is pending or, to the best of Park Monaco's knowledge,
threatened, against Park Monaco that would materially and adversely affect the
execution, delivery or enforceability of the Pooling and Servicing Agreement
or the ability of Park Monaco to sell the Park Monaco Mortgage Loans or to
perform any of its other obligations under the Pooling and Servicing Agreement
in accordance with the terms thereof.
(5) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by Park Monaco of, or compliance by Park Monaco with, the Pooling
and Servicing Agreement or the consummation of the transactions contemplated
thereby, or if any such consent, approval, authorization or order is required,
Park Monaco has obtained the same.
(6) Park Monaco intends to treat the transfer of the Park Monaco
Mortgage Loans to the Depositor as a sale of the Park Monaco Mortgage Loans
for all tax, accounting and regulatory purposes.
S-II-C-2
SCHEDULE II-D
CWALT, Inc.
Mortgage Pass-Through Certificates
Series 2006-OC1
Representations and Warranties of Park Sienna
---------------------------------------------
Park Sienna LLC ("Park Sienna") and Countrywide Home Loans, Inc.
("Countrywide"), each hereby makes the representations and warranties set
forth in this Schedule II-D to the Depositor, the Master Servicer and the
Trustee, as of the Closing Date. Capitalized terms used but not otherwise
defined in this Schedule II-D shall have the meanings ascribed thereto in the
Pooling and Servicing Agreement (the "Pooling and Servicing Agreement")
relating to the above-referenced Series, among Park Sienna, as a seller,
Countrywide, as a seller, Park Granada LLC, as a seller, Park Monaco Inc., as
a seller, Countrywide Home Loans Servicing LP, as master servicer, CWALT,
Inc., as depositor, and The Bank of New York, as trustee.
(1) Park Sienna is a limited liability company duly formed and validly
existing and in good standing under the laws of the State of Delaware.
(2) Park Sienna has the full corporate power and authority to sell each
Park Sienna Mortgage Loan, and to execute, deliver and perform, and to enter
into and consummate the transactions contemplated by the Pooling and Servicing
Agreement and has duly authorized by all necessary corporate action on the
part of Park Sienna the execution, delivery and performance of the Pooling and
Servicing Agreement; and the Pooling and Servicing Agreement, assuming the due
authorization, execution and delivery thereof by the other parties thereto,
constitutes a legal, valid and binding obligation of Park Sienna, enforceable
against Park Sienna in accordance with its terms, except that (a) the
enforceability thereof may be limited by bankruptcy, insolvency, moratorium,
receivership and other similar laws relating to creditors' rights generally
and (b) the remedy of specific performance and injunctive and other forms of
equitable relief may be subject to equitable defenses and to the discretion of
the court before which any proceeding therefor may be brought.
(3) The execution and delivery of the Pooling and Servicing Agreement by
Park Sienna, the sale of the Park Sienna Mortgage Loans by Park Sienna under
the Pooling and Servicing Agreement, the consummation of any other of the
transactions contemplated by the Pooling and Servicing Agreement, and the
fulfillment of or compliance with the terms thereof are in the ordinary course
of business of Park Sienna and will not (A) result in a material breach of any
term or provision of the certificate of formation or the limited liability
company agreement of Park Sienna or (B) materially conflict with, result in a
material breach, violation or acceleration of, or result in a material default
under, the terms of any other material agreement or instrument to which Park
Sienna is a party or by which it may be bound, or (C) constitute a material
violation of any statute, order or regulation applicable to Park Sienna of any
court, regulatory body, administrative agency or governmental body having
jurisdiction over Park Sienna; and Park Sienna is not in breach or violation
of any material indenture or other material agreement or instrument, or in
violation of any statute, order or regulation of any court,
S-II-D-1
regulatory body, administrative agency or governmental body having
jurisdiction over it which breach or violation may materially impair Park
Sienna's ability to perform or meet any of its obligations under the Pooling
and Servicing Agreement.
(4) No litigation is pending or, to the best of Park Sienna's knowledge,
threatened, against Park Sienna that would materially and adversely affect the
execution, delivery or enforceability of the Pooling and Servicing Agreement
or the ability of Park Sienna to sell the Park Sienna Mortgage Loans or to
perform any of its other obligations under the Pooling and Servicing Agreement
in accordance with the terms thereof.
(5) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by Park Sienna of, or compliance by Park Sienna with, the Pooling
and Servicing Agreement or the consummation of the transactions contemplated
thereby, or if any such consent, approval, authorization or order is required,
Park Sienna has obtained the same.
(6) Park Sienna intends to treat the transfer of the Park Sienna
Mortgage Loans to the Depositor as a sale of the Park Sienna Mortgage Loans
for all tax, accounting and regulatory purposes.
S-II-D-2
SCHEDULE III-A
CWALT, Inc.
Mortgage Pass-Through Certificates
Series 2006-OC1
Representations and Warranties of Countrywide as to all of the Mortgage Loans
-----------------------------------------------------------------------------
Countrywide Home Loans, Inc. ("Countrywide") hereby makes the
representations and warranties set forth in this Schedule III-A to the
Depositor, the Master Servicer and the Trustee, with respect to all of the
Mortgage Loans as of the Closing Date, or if so specified herein, as of the
Cut-off Date. Capitalized terms used but not otherwise defined in this
Schedule III-A shall have the meanings ascribed thereto in the Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement") relating to the
above-referenced Series, among Countrywide, as a seller, Park Granada LLC, as
a seller, Park Monaco Inc., as a seller, Park Sienna LLC, as a seller,
Countrywide Home Loans Servicing LP, as master servicer, CWALT, Inc., as
depositor, and The Bank of New York, as trustee.
The information set forth on Schedule I to the Pooling and Servicing
Agreement with respect to each Mortgage Loan is true and correct in all
material respects as of the Closing Date.
(1) As of the Closing Date, all payments due with respect to each
Mortgage Loan prior to the Cut-off Date have been made; and as of the Cut-off
Date, no Mortgage Loan has been contractually delinquent for 30 or more days
more than once during the twelve months prior to the Cut-off Date.
(2) No Mortgage Loan had a Loan-to-Value Ratio at origination in excess
of 100.00%.
(3) Each Mortgage is a valid and enforceable first lien on the Mortgaged
Property subject only to (a) the lien of non delinquent current real property
taxes and assessments, (b) covenants, conditions and restrictions, rights of
way, easements and other matters of public record as of the date of recording
of such Mortgage, such exceptions appearing of record being acceptable to
mortgage lending institutions generally or specifically reflected in the
appraisal made in connection with the origination of the related Mortgage
Loan, and (c) 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 such Mortgage.
(4) [Reserved].
(5) There is no delinquent tax or assessment lien against any Mortgaged
Property.
(6) There is no valid offset, defense or counterclaim to any Mortgage
Note or Mortgage, including the obligation of the Mortgagor to pay the unpaid
principal of or interest on such Mortgage Note.
S-III-A-1
(7) There are no mechanics' liens or claims for work, labor or material
affecting any Mortgaged Property which are or may be a lien prior to, or equal
with, the lien of such Mortgage, except those which are insured against by the
title insurance policy referred to in item (12) below.
(8) As of the Closing Date, to the best of Countrywide's knowledge, each
Mortgaged Property is free of material damage and in good repair.
(9) Each Mortgage Loan at origination complied in all material respects
with applicable local, state and federal laws, including, without limitation,
usury, equal credit opportunity, predatory and abusive lending laws, real
estate settlement procedures, truth-in-lending and disclosure laws, and
consummation of the transactions contemplated hereby will not involve the
violation of any such laws.
(10) As of the Closing Date, neither Countrywide nor any prior holder of
any Mortgage has modified the Mortgage in any material respect (except that a
Mortgage Loan may have been modified by a written instrument which has been
recorded or submitted for recordation, if necessary, to protect the interests
of the Certificateholders and the original or a copy of which has been
delivered to the Trustee); satisfied, cancelled or subordinated such Mortgage
in whole or in part; released the related Mortgaged Property in whole or in
part from the lien of such Mortgage; or executed any instrument of release,
cancellation, modification or satisfaction with respect thereto.
(11) A lender's policy of title insurance together with a condominium
endorsement and extended coverage endorsement, if applicable, in an amount at
least equal to the Cut-off Date Stated Principal Balance of each such Mortgage
Loan or a commitment (binder) to issue the same was effective on the date of
the origination of each Mortgage Loan, each such policy is valid and remains
in full force and effect, and each such policy was issued by a title insurer
qualified to do business in the jurisdiction where the Mortgaged Property is
located and acceptable to FNMA or FHLMC and is in a form acceptable to FNMA or
FHLMC, which policy insures Countrywide and successor owners of indebtedness
secured by the insured Mortgage, as to the first priority lien of the Mortgage
subject to the exceptions set forth in paragraph (4) above and against any
loss by reason of the invalidity or unenforceability of the lien resulting
from the provisions of the Mortgage providing for adjustment in the mortgage
interest rate and/or monthly payment; to the best of Countrywide's knowledge,
no claims have been made under such mortgage title insurance policy and no
prior holder of the related Mortgage, including Countrywide, has done, by act
or omission, anything which would impair the coverage of such mortgage title
insurance policy.
(12) With respect to each Mortgage Loan, all mortgage rate and payment
adjustments, if any, made on or prior to the Cut-off Date have been made in
accordance with the terms of the related Mortgage Note or subsequent
modifications, if any, and applicable law.
(13) Each Mortgage Loan was originated (within the meaning of Section
3(a)(41) of the Securities Exchange Act of 1934, as amended) by an entity that
satisfied at the time of origination the requirements of Section 3(a)(41) of
the Securities Exchange Act of 1934, as amended.
S-III-A-2
(14) To the best of Countrywide's knowledge, all of the improvements
which were included for the purpose of determining the Appraised Value of the
Mortgaged Property lie wholly within the boundaries and building restriction
lines of such property, and no improvements on adjoining properties encroach
upon the Mortgaged Property.
(15) To the best of Countrywide's knowledge, no improvement located on
or being part of the Mortgaged Property is in violation of any applicable
zoning law or regulation. To the best of Countrywide's knowledge, all
inspections, licenses and certificates required to be made or issued with
respect to all occupied portions of the Mortgaged Property and, with respect
to the use and occupancy of the same, including but not limited to
certificates of occupancy and fire underwriting certificates, have been made
or obtained from the appropriate authorities, unless the lack thereof would
not have a material adverse effect on the value of such Mortgaged Property,
and the Mortgaged Property is lawfully occupied under applicable law.
(16) Each Mortgage Note and the related Mortgage are genuine, and each
is the legal, valid and binding obligation of the maker thereof, enforceable
in accordance with its terms and under applicable law. To the best of
Countrywide's knowledge, all parties to the Mortgage Note and the Mortgage had
legal capacity to execute the Mortgage Note and the Mortgage and each Mortgage
Note and Mortgage have been duly and properly executed by such parties.
(17) The proceeds of the Mortgage Loans have been fully disbursed, 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. All costs,
fees and expenses incurred in making, or closing or recording the Mortgage
Loans were paid.
(18) The related Mortgage contains customary and enforceable provisions
which render the rights and remedies of the holder thereof adequate for the
realization against the Mortgaged Property of the benefits of the security,
including, (i) in the case of a Mortgage designated as a deed of trust, by
trustee's sale, and (ii) otherwise by judicial foreclosure.
(19) With respect to each Mortgage constituting a deed of trust, a
trustee, duly qualified under applicable law to serve as such, has been
properly designated and currently so serves and is named in such Mortgage, and
no fees or expenses are or will become payable by the Certificateholders to
the trustee under the deed of trust, except in connection with a trustee's
sale after default by the Mortgagor.
(20) Each Mortgage Note and each Mortgage is in substantially one of the
forms acceptable to FNMA or FHLMC, with such riders as have been acceptable to
FNMA or FHLMC, as the case may be.
(21) There exist no deficiencies with respect to escrow deposits and
payments, if such are required, for which customary arrangements for repayment
thereof have not been made, and no escrow deposits or payments of other
charges or payments due Countrywide have been capitalized under the Mortgage
or the related Mortgage Note.
S-III-A-3
(22) The origination, underwriting and collection practices used by
Countrywide with respect to each Mortgage Loan have been in all respects
legal, prudent and customary in the mortgage lending and servicing business.
(23) There is no pledged account or other security other than real
estate securing the Mortgagor's obligations in respect of any Mortgage Loan.
(24) No Mortgage Loan has a shared appreciation feature, or other
contingent interest feature.
(25) Each Mortgage Loan contains a customary "due on sale" clause.
(26) As of the Closing Date, 73.83% and 58.17% of the Mortgage Loans in
Loan Group 1 and Loan Group 2, respectively, provide for a prepayment penalty.
(27) Except for 13 Mortgage Loans in Loan Group 1 and 16 Mortgage Loans
in Loan Group 2, each Mortgage Loan that had a Loan-to-Value Ratio at
origination in excess of 80% is the subject of a Primary Insurance Policy that
insures that portion of the principal balance equal to a specified percentage
times the sum of the remaining principal balance of the related Mortgage Loan,
the accrued interest thereon and the related foreclosure expenses. The
specified coverage percentage for mortgage loans with terms to maturity
between 25 and 30 years is 12% for Loan-to-Value Ratios between 80.01% and
85.00%, 25% for Loan-to-Value Ratios between 85.01% and 90.00%, 30% for
Loan-to-Value Ratios between 90.01% and 95.00% and 35% for Loan-to-Value
Ratios between 95.01% and 100%. The specified coverage percentage for mortgage
loans with terms to maturity of up to 20 years ranges from 6% to 12% for
Loan-to-Value Ratios between 80.01% and 85.00%, from 12% to 20% for
Loan-to-Value Ratios between 85.01% and 90.00% and from 20% to 25% for
Loan-to-Value Ratios between 90.01% and 95.00%. Each such Primary Insurance
Policy is issued by a Qualified Insurer. All provisions of any such Primary
Insurance Policy have been and are being complied with, any such policy is in
full force and effect, and all premiums due thereunder have been paid. Any
Mortgage subject to any such Primary Insurance Policy obligates either the
Mortgagor or the mortgagee thereunder to maintain such insurance and to pay
all premiums and charges in connection therewith, subject, in each case, to
the provisions of Section 3.09(b) of the Pooling and Servicing Agreement. The
Mortgage Rate for each Mortgage Loan is net of any such insurance premium.
(28) As of the Closing Date, the improvements upon each Mortgaged
Property are covered by a valid and existing hazard insurance policy with a
generally acceptable carrier that provides for fire and extended coverage and
coverage for such other hazards as are customary in the area where the
Mortgaged Property is located in an amount which is at least equal to the
lesser of (i) the maximum insurable value of the improvements securing such
Mortgage Loan or (ii) the greater of (a) the outstanding principal balance of
the Mortgage Loan and (b) an amount such that the proceeds of such policy
shall be sufficient to prevent the Mortgagor and/or the mortgagee from
becoming a co-insurer. If the Mortgaged Property is a condominium unit, it is
included under the coverage afforded by a blanket policy for the condominium
unit. All such individual insurance policies and all flood policies referred
to in item (30) below contain a standard mortgagee clause naming Countrywide
or the original mortgagee, and its successors in interest, as mortgagee, and
Countrywide has received no notice that any premiums due and
S-III-A-4
payable thereon have not been paid; the Mortgage obligates the Mortgagor
thereunder to maintain all such insurance including flood insurance at the
Mortgagor's cost and expense, and upon the Mortgagor's failure to do so,
authorizes the holder of the Mortgage to obtain and maintain such insurance at
the Mortgagor's cost and expense and to seek reimbursement therefor from the
Mortgagor.
(29) If the Mortgaged Property is in an area identified in the Federal
Register by the Federal Emergency Management Agency as having special flood
hazards, a flood insurance policy in a form meeting the requirements of the
current guidelines of the Flood Insurance Administration is in effect with
respect to such Mortgaged Property with a generally acceptable carrier in an
amount representing coverage not less than the least of (A) the original
outstanding principal balance of the Mortgage Loan, (B) the minimum amount
required to compensate for damage or loss on a replacement cost basis, or (C)
the maximum amount of insurance that is available under the Flood Disaster
Protection Act of 1973, as amended.
(30) To the best of Countrywide's knowledge, there is no proceeding
occurring, pending or threatened for the total or partial condemnation of the
Mortgaged Property.
(31) There is no material monetary default existing under any Mortgage
or the related Mortgage Note and, to the best of Countrywide's knowledge,
there is no material 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 of acceleration under the Mortgage or the related
Mortgage Note; and Countrywide has not waived any default, breach, violation
or event of acceleration.
(32) Each Mortgaged Property is improved by a one- to four-family
residential dwelling including condominium units and dwelling units in PUDs,
which, to the best of Countrywide's knowledge, does not include cooperatives
or mobile homes and does not constitute other than real property under state
law.
(33) Each Mortgage Loan is being master serviced by the Master Servicer.
(34) Any future advances made prior to the Cut-off Date have been
consolidated with the outstanding principal amount secured by the Mortgage,
and the secured principal amount, as consolidated, bears a single interest
rate and single repayment term reflected on the Mortgage Loan Schedule. The
consolidated principal amount does not exceed the original principal amount of
the Mortgage Loan. The Mortgage Note does not permit or obligate the Master
Servicer to make future advances to the Mortgagor at the option of the
Mortgagor.
(35) 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 an escrow of funds has been
established in an amount sufficient to pay for every such item which remains
unpaid and which has been assessed, but is not yet due and payable. Except for
(A) payments in the nature of escrow payments, and (B) interest accruing from
the date of the Mortgage Note or date of disbursement of the Mortgage
proceeds, whichever is later, to the day which precedes by one month the Due
Date of the first installment of principal and interest, including without
limitation, taxes and insurance payments, the Master
Servicer has not advanced funds, or induced, solicited or knowingly received
any advance of funds by a party other than the Mortgagor, directly or
indirectly, for the payment of any amount required by the Mortgage.
(36) Approximately 6.42% of the Mortgage Loans in Loan Group 1 and 9.63%
of the Mortgage Loans in Loan Group 2 were underwritten in all material
respects in accordance with Countrywide's underwriting guidelines as set forth
in the Prospectus Supplement. Approximately 47.48% of the Mortgage Loans in
Loan Group 1 and 47.53% of the Mortgage Loans in Loan Group 2 were
underwritten in all material respects in accordance with Decision One Mortgage
Company LLC's underwriting guidelines as set forth in the Prospectus
Supplement. Each of the remaining Mortgage Loans were underwritten in all
material respects in accordance with the procedures set forth in the
Prospectus under "The Mortgage Pool - Underwriting Process".
(37) Other than with respect to any Streamlined Documentation Mortgage
Loan as to which the loan-to-value ratio of the related Original Mortgage Loan
was less than 90% at the time of the origination of such Original Mortgage
Loan, prior to the approval of the Mortgage Loan application, an appraisal of
the related Mortgaged Property was obtained from a qualified appraiser, duly
appointed by the originator, who had no interest, direct or indirect, in the
Mortgaged Property or in any loan made on the security thereof, and whose
compensation is not affected by the approval or disapproval of the Mortgage
Loan; such appraisal is in a form acceptable to FNMA and FHLMC.
(38) None of the Mortgage Loans is a graduated payment mortgage loan or
a growing equity mortgage loan, and none of the Mortgage Loans is subject to a
buydown or similar arrangement.
(39) Any leasehold estate securing a Mortgage Loan has a term of not
less than five years in excess of the term of the related Mortgage Loan.
(40) The Mortgage Loans were selected from among the outstanding
adjustable-rate one- to four-family mortgage loans in the portfolios of the
Sellers at the Closing Date as to which the representations and warranties
made as to the Mortgage Loans set forth in this Schedule III can be made. Such
selection was not made in a manner intended to adversely affect the interests
of Certificateholders.
(41) Each Mortgage Loan has a payment date on or before the Due Date in
the month of the first Distribution Date.
(42) With respect to any Mortgage Loan as to which an affidavit has been
delivered to the Trustee certifying that the original Mortgage Note is a Lost
Mortgage Note, if such Mortgage Loan is subsequently in default, the
enforcement of such Mortgage Loan or of the related Mortgage by or on behalf
of the Trustee will not be materially adversely affected by the absence of the
original Mortgage Note. A "Lost Mortgage Note" is a Mortgage Note the original
of which was permanently lost or destroyed and has not been replaced.
(43) The Mortgage Loans, individually and in the aggregate, conform in
all material respects to the descriptions thereof in the Prospectus
Supplement.
S-III-A-6
(44) No proceeds from any Mortgage Loan underlying the Certificates were
used to finance single-premium credit insurance policies.
(45) The master servicer has furnished, in accordance with the Fair
Credit Reporting Act and its implementing regulations, accurate and complete
information on its borrower credit files related to the mortgage loans to
Equifax, Experian and Trans Union Credit Information Company on a monthly
basis.
(46) The original principal balance of each Mortgage Loan in Loan Group
1 is within the dollar amount limits of Xxxxxxx Mac and Xxxxxx Mae for
conforming one- to four-family mortgage loans.
(47) No Mortgage Loan originated between October 1, 2002 and March 7,
2003 is subject to the Georgia Fair Lending Act, as amended. No Mortgage Loan
originated between October 1, 2002 and March 7, 2003 is secured by a Mortgaged
Property located in the state of Georgia, and there is no Mortgage Loan
originated on or after March 7, 2003 that is a "high cost home loan" as
defined under the Georgia Fair Lending Act.
(48) None of the Mortgage Loans are "high cost" loans as defined by
applicable predatory and abusive lending laws.
(49) None of the Mortgage Loans are covered by the Home Ownership and
Equity Protection Act of 1994 ("HOEPA").
(50) No Mortgage Loan is a "High-Cost Home Loan" as defined in the New
Jersey Home Ownership Act effective November 27, 2003 (N.J.S.A. 46:10B-22 et
seq.).
(51) No Mortgage Loan is a "High-Cost Home Loan" as defined in the New
Mexico Home Loan Protection Act effective January 1, 2004 (N.M. Stat. Xxx.
xx.xx. 58-21a-1 et seq.).
(52) All of the Mortgage Loans were originated in compliance with all
applicable laws, including, but not limited to, all applicable anti-predatory
and abusive lending laws.
(53) No Mortgage Loan is a High Cost Loan or Covered Loan, as
applicable, and with respect to the foregoing, the terms "High Cost Loan" and
"Covered Loan" have the meaning assigned to them in the then current Standard
& Poor's LEVELS(R) Version 5.6b Glossary Revised, Appendix E which is attached
hereto as Exhibit Q (the "Glossary") where (x) a "High Cost Loan" is each loan
identified in the column "Category under applicable anti-predatory lending
law" of the table entitled "Standard & Poor's High Cost Loan Categorization"
in the Glossary as each such loan is defined in the applicable anti-predatory
lending law of the State or jurisdiction specified in such table and (y) a
"Covered Loan" is each loan identified in the column "Category under
applicable anti-predatory lending law" of the table entitled "Standard &
Poor's Covered Loan Categorization" in the Glossary as each such loan is
defined in the applicable anti-predatory lending law of the State or
jurisdiction specified in such table.
(54) No Mortgage Loan originated on or after October 1, 2002 through
March 6, 2003 is governed by the Georgia Fair Lending Act.
S-III-A-7
(55) No Mortgagor related to a Mortgage Loan in Loan Group 1 was
required to purchase any single premium credit insurance policy (e.g., life,
disability, accident, unemployment, or health insurance product) or debt
cancellation agreement as a condition of obtaining the extension of credit; no
Mortgagor related to a Mortgage Loan in Loan Group 1 obtained a prepaid
single-premium credit insurance policy (e.g., life, disability, accident,
unemployment, mortgage or health insurance) in connection with the origination
of such Mortgage Loan; no proceeds from any Mortgage Loan in Loan Group 1 were
used to purchase single premium credit insurance policies or debt cancellation
agreements as part of the origination or, or as a condition to closing, such
Mortgage Loan.
(56) No Mortgage Loan originated prior to October 1, 2002 will impose
prepayment penalties for a term in excess of five years after origination.
(57) The Master Servicer for each Mortgage Loan has fully furnished, in
accordance with the Fair Credit Reporting Act and its implementing
regulations, accurate and complete information (i.e., favorable and
unfavorable) on its borrower credit files to Equifax, Experian and Trans Union
Credit Information Company (three of the credit repositories) on a monthly
basis.
S-III-A-8
SCHEDULE III-B
CWALT, Inc.
Mortgage Pass-Through Certificates
Series 2006-OC1
Representations and Warranties of Countrywide as to the
-------------------------------------------------------
Countrywide Mortgage Loans
--------------------------
Countrywide Home Loans, Inc. ("Countrywide") hereby makes the
representations and warranties set forth in this Schedule III-B to the
Depositor, the Master Servicer and the Trustee, with respect to the
Countrywide Mortgage Loans as of the Closing Date. Capitalized terms used but
not otherwise defined in this Schedule III-B shall have the meanings ascribed
thereto in the Pooling and Servicing Agreement (the "Pooling and Servicing
Agreement") relating to the above-referenced Series, among Countrywide, as a
seller, Park Granada LLC, as a seller, Park Monaco Inc., as a seller, Park
Sienna LLC, as a seller, Countrywide Home Loans Servicing LP, as master
servicer, CWALT, Inc., as depositor, and The Bank of New York, as trustee.
(1) Immediately prior to the assignment of each Countrywide Mortgage
Loan to the Depositor, Countrywide had good title to, and was the sole owner
of, such Countrywide Mortgage Loan free and clear of any pledge, lien,
encumbrance or security interest and had full right and authority, subject to
no interest or participation of, or agreement with, any other party, to sell
and assign the same pursuant to the Pooling and Servicing Agreement.
S-III-B-1
SCHEDULE III-C
CWALT, Inc.
Mortgage Pass-Through Certificates
Series 2006-OC1
Representations and Warranties of Park Granada as to the Park
-------------------------------------------------------------
Granada Mortgage Loans
----------------------
Park Granada LLC ("Park Granada") hereby makes the representations and
warranties set forth in this Schedule III-C to the Depositor, the Master
Servicer and the Trustee, with respect to the Park Granada Mortgage Loans as
of the Closing Date. Capitalized terms used but not otherwise defined in this
Schedule III-C shall have the meanings ascribed thereto in the Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement") relating to the
above-referenced Series, among Countrywide Home Loans, Inc., as a seller, Park
Granada LLC, as a seller, Park Monaco Inc., as a seller, Park Sienna LLC, as a
seller, Countrywide Home Loans Servicing LP, as master servicer, CWALT, Inc.,
as depositor, and The Bank of New York, as trustee.
(2) Immediately prior to the assignment of each Park Granada Mortgage
Loan to the Depositor, Park Granada had good title to, and was the sole owner
of, such Park Granada Mortgage Loan free and clear of any pledge, lien,
encumbrance or security interest and had full right and authority, subject to
no interest or participation of, or agreement with, any other party, to sell
and assign the same pursuant to the Pooling and Servicing Agreement.
S-III-C-1
SCHEDULE III-D
CWALT, Inc.
Mortgage Pass-Through Certificates
Series 2006-OC1
Representations and Warranties of Park Monaco as to the
-------------------------------------------------------
Park Monaco Mortgage Loans
--------------------------
Park Monaco Inc. ("Park Monaco") hereby makes the representations and
warranties set forth in this Schedule III-D to the Depositor, the Master
Servicer and the Trustee, with respect to the Park Monaco Mortgage Loans as of
the Closing Date, or if so specified herein, as of the Cut-off Date.
Capitalized terms used but not otherwise defined in this Schedule III-D shall
have the meanings ascribed thereto in the Pooling and Servicing Agreement (the
"Pooling and Servicing Agreement") relating to the above-referenced Series,
among Countrywide Home Loans, Inc., as a seller, Park Monaco, as a seller,
Park Granada LLC, as a seller, Park Sienna LLC, as a seller, Countrywide Home
Loans Servicing LP, as master servicer, CWALT, Inc., as depositor, and The
Bank of New York, as trustee.
(1) Immediately prior to the assignment of each Park Monaco Mortgage
Loan to the Depositor, Park Monaco had good title to, and was the sole owner
of, such Park Monaco Mortgage Loan free and clear of any pledge, lien,
encumbrance or security interest and had full right and authority, subject to
no interest or participation of, or agreement with, any other party, to sell
and assign the same pursuant to the Pooling and Servicing Agreement.
S-III-D-1
SCHEDULE III-E
CWALT, Inc.
Mortgage Pass-Through Certificates
Series 2006-OC1
Representations and Warranties of Park Sienna as to the
-------------------------------------------------------
Park Sienna Mortgage Loans
--------------------------
Park Sienna LLC ("Park Sienna") hereby makes the representations and
warranties set forth in this Schedule III-E to the Depositor, the Master
Servicer and the Trustee, with respect to the Park Sienna Mortgage Loans as of
the Closing Date, or if so specified herein, as of the Cut-off Date.
Capitalized terms used but not otherwise defined in this Schedule III-E shall
have the meanings ascribed thereto in the Pooling and Servicing Agreement (the
"Pooling and Servicing Agreement") relating to the above-referenced Series,
among Countrywide Home Loans, Inc., as a seller, Park Sienna LLC, as a seller,
Park Monaco Inc., as a seller, Park Granada LLC, as a seller, Countrywide Home
Loans Servicing LP, as master servicer, CWALT, Inc., as depositor, and The
Bank of New York, as trustee.
(1) Immediately prior to the assignment of each Park Sienna Mortgage
Loan to the Depositor, Park Sienna had good title to, and was the sole owner
of, such Park Sienna Mortgage Loan free and clear of any pledge, lien,
encumbrance or security interest and had full right and authority, subject to
no interest or participation of, or agreement with, any other party, to sell
and assign the same pursuant to the Pooling and Servicing Agreement.
S-III-E-1
SCHEDULE IV
CWALT, Inc.
Mortgage Pass-Through Certificates
Series 2006-OC1
Representations and Warranties of the Master Servicer
-----------------------------------------------------
Countrywide Home Loans Servicing LP ("Countrywide Servicing") hereby
makes the representations and warranties set forth in this Schedule IV to the
Depositor, the Sellers and the Trustee, as of the Closing Date. Capitalized
terms used but not otherwise defined in this Schedule IV shall have the
meanings ascribed thereto in the Pooling and Servicing Agreement (the "Pooling
and Servicing Agreement") relating to the above-referenced Series, among
Countrywide Home Loans, Inc., as a seller, Park Granada LLC, as a seller, Park
Monaco Inc., as a seller, Park Sienna LLC, as a seller, Countrywide Home Loans
Servicing LP, as master servicer, CWALT, Inc., as depositor, and The Bank of
New York, as trustee.
(1) Countrywide Servicing is duly organized as a limited
partnership and is validly existing and in good standing under the laws of the
State of Texas and is duly authorized and qualified to transact any and all
business contemplated by the Pooling and Servicing Agreement to be conducted
by Countrywide Servicing in any state in which a Mortgaged Property is located
or is otherwise not required under applicable law to effect such qualification
and, in any event, is in compliance with the doing business laws of any such
state, to the extent necessary to perform any of its obligations under the
Pooling and Servicing Agreement in accordance with the terms thereof.
(2) Countrywide Servicing has the full partnership power and
authority to service each Mortgage Loan, and to execute, deliver and perform,
and to enter into and consummate the transactions contemplated by the Pooling
and Servicing Agreement and has duly authorized by all necessary partnership
action on the part of Countrywide Servicing the execution, delivery and
performance of the Pooling and Servicing Agreement; and the Pooling and
Servicing Agreement, assuming the due authorization, execution and delivery
thereof by the other parties thereto, constitutes a legal, valid and binding
obligation of Countrywide Servicing, enforceable against Countrywide Servicing
in accordance with its terms, except that (a) the enforceability thereof may
be limited by bankruptcy, insolvency, moratorium, receivership and other
similar laws relating to creditors' rights generally and (b) the remedy of
specific performance and injunctive and other forms of equitable relief may be
subject to equitable defenses and to the discretion of the court before which
any proceeding therefor may be brought.
(3) The execution and delivery of the Pooling and Servicing
Agreement by Countrywide Servicing, the servicing of the Mortgage Loans by
Countrywide Servicing under the Pooling and Servicing Agreement, the
consummation of any other of the transactions contemplated by the Pooling and
Servicing Agreement, and the fulfillment of or compliance with the terms
thereof are in the ordinary course of business of Countrywide Servicing and
will not (A) result in a material breach of any term or provision of the
certificate of limited partnership, partnership agreement or other
organizational document of Countrywide Servicing or
(B) materially conflict with, result in a material breach, violation or
acceleration of, or result in a material default under, the terms of any other
material agreement or instrument to which Countrywide Servicing is a party or
by which it may be bound, or (C) constitute a material violation of any
statute, order or regulation applicable to Countrywide Servicing of any court,
regulatory body, administrative agency or governmental body having
jurisdiction over Countrywide Servicing; and Countrywide Servicing is not in
breach or violation of any material indenture or other material agreement or
instrument, or in violation of any statute, order or regulation of any court,
regulatory body, administrative agency or governmental body having
jurisdiction over it which breach or violation may materially impair the
ability of Countrywide Servicing to perform or meet any of its obligations
under the Pooling and Servicing Agreement.
(4) Countrywide Servicing is an approved servicer of conventional
mortgage loans for FNMA or FHLMC and is a mortgagee approved by the Secretary
of Housing and Urban Development pursuant to sections 203 and 211 of the
National Housing Act.
(5) No litigation is pending or, to the best of Countrywide
Servicing's knowledge, threatened, against Countrywide Servicing that would
materially and adversely affect the execution, delivery or enforceability of
the Pooling and Servicing Agreement or the ability of Countrywide Servicing to
service the Mortgage Loans or to perform any of its other obligations under
the Pooling and Servicing Agreement in accordance with the terms thereof.
(6) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by Countrywide Servicing of, or compliance by Countrywide
Servicing with, the Pooling and Servicing Agreement or the consummation of the
transactions contemplated thereby, or if any such consent, approval,
authorization or order is required, Countrywide Servicing has obtained the
same.
(7) Countrywide Servicing is a member of MERS in good standing,
and will comply in all material respects with the rules and procedures of MERS
in connection with the servicing of the MERS Mortgage Loans for as long as
such Mortgage Loans are registered with MERS.
S-IV-2
SCHEDULE V
Principal Balances Schedule
*[Attached to Prospectus Supplement, if applicable.]
S-V-1
SCHEDULE VI
Form of Monthly Master Servicer Report
===========================================================================================================
LOAN LEVEL REPORTING SYSTEM
-----------------------------------------------------------------------------------------------------------
DATABASE STRUCTURE
-----------------------------------------------------------------------------------------------------------
[MONTH, YEAR]
-----------------------------------------------------------------------------------------------------------
Field Number Field Name Field Type Field Width Dec
-----------------------------------------------------------------------------------------------------------
1 INVNUM Numeric 4
-----------------------------------------------------------------------------------------------------------
2 INVBLK Numeric 4
-----------------------------------------------------------------------------------------------------------
3 INACNU Character 8
-----------------------------------------------------------------------------------------------------------
4 BEGSCH Numeric 15 2
-----------------------------------------------------------------------------------------------------------
5 SCHPRN Numeric 13 2
-----------------------------------------------------------------------------------------------------------
6 TADPRN Numeric 11 2
-----------------------------------------------------------------------------------------------------------
7 LIQEPB Numeric 11 2
-----------------------------------------------------------------------------------------------------------
8 ACTCOD Numeric 11
-----------------------------------------------------------------------------------------------------------
9 ACTDAT Numeric 4
-----------------------------------------------------------------------------------------------------------
10 INTPMT Numeric 8
-----------------------------------------------------------------------------------------------------------
11 PRNPMT Numeric 13 2
-----------------------------------------------------------------------------------------------------------
12 ENDSCH Numeric 13 2
-----------------------------------------------------------------------------------------------------------
13 SCHNOT Numeric 13 2
-----------------------------------------------------------------------------------------------------------
14 SCHPAS Numeric 7 3
-----------------------------------------------------------------------------------------------------------
15 PRINPT Numeric 7 3
-----------------------------------------------------------------------------------------------------------
16 PRIBAL Numeric 11 2
-----------------------------------------------------------------------------------------------------------
17 LPIDTE Numeric 13 2
-----------------------------------------------------------------------------------------------------------
18 DELPRN Numeric 7
-----------------------------------------------------------------------------------------------------------
19 PPDPRN Numeric 11 2
-----------------------------------------------------------------------------------------------------------
20 DELPRN Numeric 11 2
-----------------------------------------------------------------------------------------------------------
21 NXTCHG Numeric 8
-----------------------------------------------------------------------------------------------------------
22 ARMNOT Numeric 7 3
-----------------------------------------------------------------------------------------------------------
23 ARMPAS Numeric 7 3
-----------------------------------------------------------------------------------------------------------
24 ARMPMT Numeric 11 2
-----------------------------------------------------------------------------------------------------------
25 ZZTYPE Character 2
-----------------------------------------------------------------------------------------------------------
26 ISSUID Character 1
-----------------------------------------------------------------------------------------------------------
27 KEYNAME Character 8
-----------------------------------------------------------------------------------------------------------
TOTAL 240
-----------------------------------------------------------------------------------------------------------
Suggested Format: DBASE file
Modem transmission
===========================================================================================================
S-VI-1
EXHIBIT A
[FORM OF SENIOR CERTIFICATE]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
[SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE").]
[UNTIL THIS CERTIFICATE HAS BEEN THE SUBJECT OF AN ERISA-QUALIFYING
UNDERWRITING, NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE
TRANSFERRED UNLESS THE TRANSFEREE DELIVERS TO THE TRUSTEE EITHER (A) A
REPRESENTATION LETTER TO THE EFFECT THAT SUCH TRANSFEREE IS NOT, AND IS NOT
INVESTING ASSETS OF, AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR A PLAN OR
ARRANGEMENT SUBJECT TO SECTION 4975 OF THE CODE, OR (B) AN OPINION OF COUNSEL
IN ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN. SUCH
REPRESENTATION SHALL BE DEEMED TO HAVE BEEN MADE TO THE TRUSTEE BY THE
TRANSFEREE'S ACCEPTANCE OF A CERTIFICATE OF THIS CLASS AND BY A BENEFICIAL
OWNER'S ACCEPTANCE OF ITS INTEREST IN A CERTIFICATE OF THIS CLASS.
NOTWITHSTANDING ANYTHING ELSE TO THE CONTRARY HEREIN, UNTIL THIS CERTIFICATE
HAS BEEN THE SUBJECT OF AN ERISA-QUALIFYING UNDERWRITING, ANY PURPORTED
TRANSFER OF THIS CERTIFICATE TO, OR TO A PERSON INVESTING ASSETS OF, AN
EMPLOYEE BENEFIT PLAN SUBJECT TO ERISA OR A PLAN OR ARRANGEMENT SUBJECT TO
SECTION 4975 OF THE CODE WITHOUT THE OPINION OF COUNSEL SATISFACTORY TO THE
TRUSTEE AS DESCRIBED ABOVE SHALL BE VOID AND OF NO EFFECT.]
A-1
Certificate No. :
Cut-off Date :
First Distribution Date :
Initial Certificate Balance
of this Certificate
("Denomination") : $
Initial Certificate Balance
of all Certificates of
this Class : $
CUSIP :
Interest Rate :
Maturity Date :
CWALT, INC.
Mortgage Pass-Through Certificates, Series 200____-____
Class [ ]
evidencing a percentage interest in the distributions allocable to
the Certificates of the above-referenced Class with respect to a
Trust Fund consisting primarily of a pool of conventional mortgage
loans (the "Mortgage Loans") secured by first liens on one- to
four-family residential properties
CWALT, Inc., as Depositor
Principal in respect of this Certificate is distributable monthly as
set forth herein. Accordingly, the Certificate Balance at any time may be less
than the Certificate Balance as set forth herein. This Certificate does not
evidence an obligation of, or an interest in, and is not guaranteed by the
Depositor, the Sellers, the Master Servicer or the Trustee referred to below
or any of their respective affiliates. Neither this Certificate nor the
Mortgage Loans are guaranteed or insured by any governmental agency or
instrumentality.
This certifies that_________ is the registered owner of the Percentage
Interest evidenced by this Certificate (obtained by dividing the denomination
of this Certificate by the aggregate Initial Certificate Balance of all
Certificates of the Class to which this Certificate belongs) in certain
monthly distributions with respect to a Trust Fund consisting primarily of the
Mortgage
A-2
Loans deposited by CWALT, Inc. (the "Depositor"). The Trust Fund was created
pursuant to a Pooling and Servicing Agreement dated as of the Cut-off Date
specified above (the "Agreement") among the Depositor, Countrywide Home Loans,
Inc., as a seller ("CHL"), Park Granada LLC, as a seller ("Park Granada"),
Park Monaco, Inc., as a seller ("Park Monaco"), and Park Sienna LLC, as a
seller ("Park Sienna" and, together with CHL, Park Granada and Park Monaco,
the "Sellers"), Countrywide Home Loans Servicing LP, as master servicer (the
"Master Servicer"), and The Bank of New York, as trustee (the "Trustee"). To
the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
[Until this certificate has been the subject of an ERISA-Qualifying
Underwriting, no transfer of a Certificate of this Class shall be made unless
the Trustee shall have received either (i) a representation letter from the
transferee of such Certificate, acceptable to and in form and substance
satisfactory to the Trustee, to the effect that such transferee is not an
employee benefit plan subject to Section 406 of ERISA or a plan or arrangement
subject to Section 4975 of the Code, or a person acting on behalf of or
investing plan assets of any such benefit plan or arrangement, which
representation letter shall not be an expense of the Trustee, the Master
Servicer or the Trust Fund, or (ii) in the case of any such Certificate
presented for registration in the name of an employee benefit plan subject to
ERISA or a plan or arrangement subject to Section 4975 of the Code (or
comparable provisions of any subsequent enactments), a trustee of any such
benefit plan or arrangement or any other person acting on behalf of any such
benefit plan or arrangement, an Opinion of Counsel satisfactory to the Trustee
to the effect that the purchase and holding of such Certificate will not
result in a non-exempt prohibited transaction under Section 406 of ERISA or
Section 4975 of the Code, and will not subject the Trustee or the Master
Servicer to any obligation in addition to those undertaken in the Agreement,
which Opinion of Counsel shall not be an expense of the Trustee, the Master
Servicer or the Trust Fund. Unless the transferee delivers the Opinion of
Counsel described above, such representation shall be deemed to have been made
to the Trustee by the Transferee's acceptance of a Certificate of this Class
and by a beneficial owner's acceptance of its interest in a Certificate of
this Class. Notwithstanding anything else to the contrary herein, until such
certificate has been the subject of an ERISA-Qualifying Underwriting, any
purported transfer of a Certificate of this Class to, or to a person investing
assets of, an employee benefit plan subject to ERISA or a plan or arrangement
subject to Section 4975 of the Code without the opinion of counsel
satisfactory to the Trustee as described above shall be void and of no
effect.]
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall
for all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.
* * *
A-3
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: ____________, 20__
THE BANK OF NEW YORK,
as Trustee
By ______________________
Countersigned:
By _____________________________
Authorized Signatory of
THE BANK OF NEW YORK,
as Trustee
A-4
EXHIBIT B
[FORM OF SUBORDINATED CERTIFICATE]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE").
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO CERTAIN CERTIFICATES
AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT
REGISTRATION THEREOF UNDER THE ACT MAY ONLY BE MADE IN A TRANSACTION EXEMPTED
FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH THE
PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.
[NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS
THE TRANSFEREE DELIVERS TO THE TRUSTEE EITHER (A) A REPRESENTATION LETTER TO
THE EFFECT THAT (i) SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), A
PLAN OR ARRANGEMENT SUBJECT TO SECTION 4975 OF THE CODE, OR A PERSON ACTING ON
BEHALF OF OR INVESTING THE ASSETS OF SUCH A BENEFIT PLAN OR ARRANGEMENT TO
EFFECT THE TRANSFER, OR (ii) IF SUCH CERTIFICATE HAS BEEN THE SUBJECT OF AN
ERISA-QUALIFYING UNDERWRITING AND THE TRANSFEREE IS AN INSURANCE COMPANY, A
REPRESENTATION THAT THE TRANSFEREE IS PURCHASING SUCH CERTIFICATE WITH FUNDS
CONTAINED IN AN "INSURANCE COMPANY GENERAL ACCOUNT" AS SUCH TERM IS DEFINED IN
SECTION V(e) OF PROHIBITED TRANSACTION CLASS EXEMPTION ("PTCE") 95-60, AND THE
B-1
PURCHASE AND HOLDING OF THE CERTIFICATE SATISFY THE REQUIREMENTS FOR EXEMPTIVE
RELIEF UNDER SECTIONS I AND III OF PTCE 95-60, OR (B) AN OPINION OF COUNSEL IN
ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.
NOTWITHSTANDING ANYTHING ELSE TO THE CONTRARY HEREIN, ANY PURPORTED TRANSFER
OF THIS CERTIFICATE TO OR ON BEHALF OF AN EMPLOYEE BENEFIT PLAN SUBJECT TO
ERISA OR A PLAN OR ARRANGEMENT SUBJECT TO SECTION 4975 OF THE CODE WITHOUT THE
OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE AS DESCRIBED ABOVE SHALL BE
VOID AND OF NO EFFECT.]
B-2
Certificate No. :
Cut-off Date :
First Distribution Date :
Initial Certificate Balance
of this Certificate
("Denomination") : $
Initial Certificate Balance
of all Certificates of
this Class : $
CUSIP :
Interest Rate :
Maturity Date :
CWALT, INC.
Mortgage Pass-Through Certificates, Series 200____-____
Class [ ]
evidencing a percentage interest in the distributions allocable to
the Certificates of the above-referenced Class with respect to a
Trust Fund consisting primarily of a pool of conventional mortgage
loans (the "Mortgage Loans") secured by first liens on one- to
four-family residential properties
CWALT, Inc., as Depositor
Principal in respect of this Certificate is distributable monthly as
set forth herein. Accordingly, the Certificate Balance at any time may be less
than the Certificate Balance as set forth herein. This Certificate does not
evidence an obligation of, or an interest in, and is not guaranteed by the
Depositor, the Sellers, the Master Servicer or the Trustee referred to below
or any of their respective affiliates. Neither this Certificate nor the
Mortgage Loans are guaranteed or insured by any governmental agency or
instrumentality.
This certifies that ____________ is the registered owner of the
Percentage Interest evidenced by this Certificate (obtained by dividing the
denomination of this Certificate by the aggregate Initial Certificate Balance
of all Certificates of the Class to which this Certificate
B-3
belongs) in certain monthly distributions with respect to a Trust Fund
consisting primarily of the Mortgage Loans deposited by CWALT, Inc. (the
"Depositor"). The Trust Fund was created pursuant to a Pooling and Servicing
Agreement dated as of the Cut-off Date specified above (the "Agreement") among
the Depositor, Countrywide Home Loans, Inc., as a seller ("CHL"), Park Granada
LLC, as a seller ("Park Granada"), Park Monaco, Inc., as a seller ("Park
Monaco"), and Park Sienna LLC, as a seller ("Park Sienna" and, together with
CHL, Park Granada and Park Monaco, the "Sellers"), Countrywide Home Loans
Servicing LP, as master servicer (the "Master Servicer"), and The Bank of New
York, as trustee (the "Trustee"). To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
[No transfer of a Certificate of this Class shall be made unless such
transfer is made pursuant to an effective registration statement under the
Securities Act and any applicable state securities laws or is exempt from the
registration requirements under said Act and such laws. In the event that a
transfer is to be made in reliance upon an exemption from the Securities Act
and such laws, in order to assure compliance with the Securities Act and such
laws, the Certificateholder desiring to effect such transfer and such
Certificateholder's prospective transferee shall each certify to the Trustee
in writing the facts surrounding the transfer. In the event that such a
transfer is to be made within three years from the date of the initial
issuance of Certificates pursuant hereto, there shall also be delivered
(except in the case of a transfer pursuant to Rule 144A of the Securities Act)
to the Trustee an Opinion of Counsel that such transfer may be made pursuant
to an exemption from the Securities Act and such state securities laws, which
Opinion of Counsel shall not be obtained at the expense of the Trustee, the
Sellers, the Master Servicer or the Depositor. The Holder hereof desiring to
effect such transfer shall, and does hereby agree to, indemnify the Trustee
and the Depositor against any liability that may result if the transfer is not
so exempt or is not made in accordance with such federal and state laws.]
[No transfer of a Certificate of this Class shall be made unless the
Trustee shall have received either (i) a representation letter from the
transferee of such Certificate, acceptable to and in form and substance
satisfactory to the Trustee, to the effect that such transferee is not an
employee benefit plan subject to Section 406 of ERISA or a plan or arrangement
subject to Section 4975 of the Code, or a person acting on behalf of or
investing plan assets of any such benefit plan or arrangement, which
representation letter shall not be an expense of the Trustee, the Master
Servicer or the Trust Fund, (ii) if such certificate has been the subject of
an ERISA-Qualifying Underwriting and the transferee is an insurance company, a
representation that the transferee is purchasing such Certificate with funds
contained in an "insurance company general account" (as such term is defined
in Section V(e) of Prohibited Transaction Class Exemption 95-60 ("PTCE
95-60")) and that the purchase and holding of such Certificate satisfy the
requirements for exemptive relief under Sections I and III of PTCE 95-60, or
(iii) in the case of any such Certificate presented for registration in the
name of an employee benefit plan subject to ERISA or a plan or arrangement
subject to Section 4975 of the Code (or comparable provisions
B-4
of any subsequent enactments), a trustee of any such benefit plan or
arrangement or any other person acting on behalf of any such benefit plan or
arrangement, an Opinion of Counsel satisfactory to the Trustee to the effect
that the purchase and holding of such Certificate will not result in a
prohibited transaction under Section 406 of ERISA or Section 4975 of the Code,
and will not subject the Trustee or the Master Servicer to any obligation in
addition to those undertaken in the Agreement, which Opinion of Counsel shall
not be an expense of the Trustee, the Master Servicer or the Trust Fund.
Notwithstanding anything else to the contrary herein, any purported transfer
of a Certificate of this Class to or on behalf of an employee benefit plan
subject to ERISA or a plan or arrangement subject to Section 4975 of the Code
without the opinion of counsel satisfactory to the Trustee as described above
shall be void and of no effect.]
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall
for all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.
* * *
B-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: ____________, 20__
THE BANK OF NEW YORK,
as Trustee
By ______________________
Countersigned:
By ______________________________
Authorized Signatory of
THE BANK OF NEW YORK,
as Trustee
B-6
EXHIBIT C-1
[FORM OF RESIDUAL CERTIFICATE]
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE").
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED TRANSFEREE DELIVERS TO THE TRUSTEE A TRANSFER AFFIDAVIT IN ACCORDANCE
WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
TRANSFEREE DELIVERS TO THE TRUSTEE EITHER (A) A REPRESENTATION LETTER TO THE
EFFECT THAT (i) SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), A PLAN
OR ARRANGEMENT SUBJECT TO SECTION 4975 OF THE CODE, OR A PERSON ACTING ON
BEHALF OF OR INVESTING THE ASSETS OF SUCH A BENEFIT PLAN OR ARRANGEMENT TO
EFFECT THE TRANSFER, OR (ii) IF SUCH CERTIFICATE HAS BEEN THE SUBJECT OF AN
ERISA-QUALIFYING UNDERWRITING AND THE TRANSFEREE IS AN INSURANCE COMPANY, A
REPRESENTATION THAT THE TRANSFEREE IS PURCHASING SUCH CERTIFICATE WITH FUNDS
CONTAINED IN AN "INSURANCE COMPANY GENERAL ACCOUNT" AS SUCH TERM IS DEFINED IN
SECTION V(e) OF PROHIBITED TRANSACTION CLASS EXEMPTION ("PTCE") 95-60, AND THE
PURCHASE AND HOLDING OF THE CERTIFICATE SATISFY THE REQUIREMENTS FOR EXEMPTIVE
RELIEF UNDER SECTIONS I AND III OF PTCE 95-60, OR (B) AN OPINION OF COUNSEL IN
ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.
NOTWITHSTANDING ANYTHING ELSE TO THE CONTRARY HEREIN, ANY PURPORTED TRANSFER
OF THIS CERTIFICATE TO OR ON BEHALF OF AN EMPLOYEE BENEFIT PLAN SUBJECT TO
ERISA OR A PLAN OR ARRANGEMENT SUBJECT TO SECTION 4975 OF THE CODE WITHOUT THE
OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE AS DESCRIBED ABOVE SHALL BE
VOID AND OF NO EFFECT.
[THIS CERTIFICATE REPRESENTS THE "TAX MATTERS PERSON RESIDUAL INTEREST" ISSUED
UNDER THE POOLING AND SERVICING AGREEMENT REFERRED TO BELOW AND MAY NOT BE
TRANSFERRED TO ANY PERSON EXCEPT IN CONNECTION WITH THE ASSUMPTION BY THE
TRANSFEREE OF THE DUTIES OF THE SERVICER UNDER SUCH AGREEMENT.]
C-1-1
Certificate No. :
Cut-off Date :
First Distribution Date :
Initial Certificate Balance
of this Certificate
("Denomination") : $
Initial Certificate Balance
of all Certificates of
this Class : $
CUSIP :
Interest Rate :
Maturity Date :
CWALT, INC.
Mortgage Pass-Through Certificates, Series 200____-____
Class A-R
evidencing the distributions allocable to the Class A-R Certificates
with respect to a Trust Fund consisting primarily of a pool of
conventional mortgage loans (the "Mortgage Loans") secured by first
liens on one- to four-family residential properties
CWALT, Inc., as Depositor
Principal in respect of this Certificate is distributable monthly as
set forth herein. Accordingly, the Certificate Balance at any time may be less
than the Certificate Balance as set forth herein. This Certificate does not
evidence an obligation of, or an interest in, and is not guaranteed by the
Depositor, the Sellers, the Master Servicer or the Trustee referred to below
or any of their respective affiliates. Neither this Certificate nor the
Mortgage Loans are guaranteed or insured by any governmental agency or
instrumentality.
This certifies that______________ is the registered owner of the
Percentage Interest (obtained by dividing the Denomination of this Certificate
by the aggregate Initial Certificate Balance of all Certificates of the Class
to which this Certificate belongs) in certain monthly distributions with
respect to a Trust Fund consisting of the Mortgage Loans deposited by CWALT,
Inc. (the
C-1-2
"Depositor"). The Trust Fund was created pursuant to a Pooling and Servicing
Agreement dated as of the Cut-off Date specified above (the "Agreement") among
the Depositor, Countrywide Home Loans, Inc., as a seller ("CHL"), Park Granada
LLC, as a seller ("Park Granada"), Park Monaco, Inc., as a seller ("Park
Monaco"), and Park Sienna LLC, as a seller ("Park Sienna" and, together with
CHL, Park Granada and Park Monaco, the "Sellers"), Countrywide Home Loans
Servicing LP, as master servicer (the "Master Servicer"), and The Bank of New
York, as trustee (the "Trustee"). To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Any distribution of the proceeds of any remaining assets of the Trust
Fund will be made only upon presentment and surrender of this Class A-R
Certificate at the Corporate Trust Office or the office or agency maintained
by the Trustee in New York, New York.
No transfer of a Class A-R Certificate shall be made unless the
Trustee shall have received either (i) a representation letter from the
transferee of such Certificate, acceptable to and in form and substance
satisfactory to the Trustee, to the effect that such transferee is not an
employee benefit plan subject to Section 406 of ERISA or a plan or arrangement
subject to Section 4975 of the Code, or a person acting on behalf of or
investing plan assets of any such benefit plan or arrangement, which
representation letter shall not be an expense of the Trustee, the Master
Servicer or the Trust Fund, (ii) if such certificate has been the subject of
an ERISA-Qualifying Underwriting and the transferee is an insurance company, a
representation that the transferee is purchasing such Certificate with funds
contained in an "insurance company general account" (as such term is defined
in Section V(e) of Prohibited Transaction Class Exemption 95-60 ("PTCE
95-60")) and that the purchase and holding of such Certificate satisfy the
requirements for exemptive relief under Sections I and III of PTCE 95-60, or
(iii) in the case of any such Certificate presented for registration in the
name of an employee benefit plan subject to ERISA or a plan or arrangement
subject to Section 4975 of the Code (or comparable provisions of any
subsequent enactments), a trustee of any such benefit plan or arrangement or
any other person acting on behalf of any such benefit plan or arrangement, an
Opinion of Counsel satisfactory to the Trustee to the effect that the purchase
and holding of such Certificate will not result in a prohibited transaction
under Section 406 of ERISA or Section 4975 of the Code, and will not subject
the Trustee or the Master Servicer to any obligation in addition to those
undertaken in the Agreement, which Opinion of Counsel shall not be an expense
of the Trustee, the Master Servicer or the Trust Fund. Notwithstanding
anything else to the contrary herein, any purported transfer of a Class A-R
Certificate to or on behalf of an employee benefit plan subject to ERISA or a
plan or arrangement subject to Section 4975 of the Code without the opinion of
counsel satisfactory to the Trustee as described above shall be void and of no
effect.
Each Holder of this Class A-R Certificate will be deemed to have
agreed to be bound by the restrictions of the Agreement, including but not
limited to the restrictions that (i) each person holding or acquiring any
Ownership Interest in this Class A-R Certificate must be a Permitted
Transferee, (ii) no Ownership Interest in this Class A-R Certificate may be
transferred without
C-1-3
delivery to the Trustee of (a) a transfer affidavit of the proposed transferee
and (b) a transfer certificate of the transferor, each of such documents to be
in the form described in the Agreement, (iii) each person holding or acquiring
any Ownership Interest in this Class A-R Certificate must agree to require a
transfer affidavit and to deliver a transfer certificate to the Trustee as
required pursuant to the Agreement, (iv) each person holding or acquiring an
Ownership Interest in this Class A-R Certificate must agree not to transfer an
Ownership Interest in this Class A-R Certificate if it has actual knowledge
that the proposed transferee is not a Permitted Transferee and (v) any
attempted or purported transfer of any Ownership Interest in this Class A-R
Certificate in violation of such restrictions will be absolutely null and void
and will vest no rights in the purported transferee.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall
for all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.
* * *
C-1-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: ____________, 20__
THE BANK OF NEW YORK,
as Trustee
By ______________________
Countersigned:
By ___________________________
Authorized Signatory of
THE BANK OF NEW YORK,
as Trustee
C-1-5
EXHIBIT C-2
[FORM OF CLASS P CERTIFICATE]
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986 (THE "CODE").
THIS CLASS P CERTIFICATE IS SUBORDINATE TO THE OFFERED CERTIFICATES TO THE
EXTENT DESCRIBED HEREIN AND IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
THIS CLASS P CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS UNTIL SUCH TIME AS
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CLASS P CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES LAWS OF
ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE
WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION
THAT DOES NOT REQUIRE SUCH REGISTRATION OR QUALIFICATION AND IN ACCORDANCE
WITH THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
TRANSFEREE DELIVERS TO THE TRUSTEE EITHER (A) A REPRESENTATION LETTER TO THE
EFFECT THAT (i) SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), A PLAN
OR ARRANGEMENT SUBJECT TO SECTION 4975 OF THE CODE, OR A PERSON ACTING ON
BEHALF OF OR INVESTING THE ASSETS OF SUCH A BENEFIT PLAN OR ARRANGEMENT TO
EFFECT THE TRANSFER, OR (ii) IF SUCH CERTIFICATE HAS BEEN THE SUBJECT OF AN
ERISA-QUALIFYING UNDERWRITING AND THE TRANSFEREE IS AN INSURANCE COMPANY, A
REPRESENTATION THAT THE TRANSFEREE IS PURCHASING SUCH CERTIFICATE WITH FUNDS
CONTAINED IN AN "INSURANCE COMPANY GENERAL ACCOUNT" AS SUCH TERM IS DEFINED IN
SECTION V(e) OF PROHIBITED TRANSACTION CLASS EXEMPTION ("PTCE") 95-60, AND THE
PURCHASE AND HOLDING OF THE CERTIFICATE SATISFY THE REQUIREMENTS FOR EXEMPTIVE
RELIEF UNDER SECTIONS I AND III OF PTCE 95-60, OR (B) AN OPINION OF COUNSEL IN
ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.
NOTWITHSTANDING ANYTHING ELSE TO THE CONTRARY HEREIN, ANY PURPORTED TRANSFER
OF THIS CERTIFICATE TO OR ON BEHALF OF AN EMPLOYEE BENEFIT PLAN SUBJECT TO
ERISA OR A PLAN
C-2-1
OR ARRANGEMENT SUBJECT TO SECTION 4975 OF THE CODE WITHOUT THE OPINION OF
COUNSEL SATISFACTORY TO THE TRUSTEE AS DESCRIBED ABOVE SHALL BE VOID AND OF NO
EFFECT.
C-2-2
Certificate No. :
Initial Certificate Balance
of this Certificate
("Denomination") : $
Initial Certificate Balance
of all Certificates of
this Class : $
CUSIP :
ISIN :
Interest Rate :
Maturity Date :
CWALT, INC.
Alternative Loan Trust 200____-____
Mortgage Pass-Through Certificates, Series 200____-____
evidencing a percentage interest in the distributions allocable to
the Class P Certificates with respect to a Trust Fund consisting
primarily of a pool of conventional mortgage loans (the "Mortgage
Loans") secured by first and second liens on one- to four-family
residential properties
CWALT, Inc., as Depositor
This Certificate does not evidence an obligation of, or an interest
in, and is not guaranteed by the Depositor, the Master Servicer or the Trustee
referred to below or any of their respective affiliates. Neither this
Certificate nor the Mortgage Loans are guaranteed or insured by any
governmental agency or instrumentality.
This certifies that __________________ is the registered owner of the
Percentage Interest evidenced by this Certificate (obtained by dividing the
denomination of this Certificate by the aggregate Initial Notional Amount of
all Certificates of the Class to which this Certificate belongs) in certain
monthly distributions with respect to a Trust Fund consisting primarily of the
Mortgage Loans deposited by CWALT, Inc. (the "Depositor"). The Trust Fund was
created pursuant to a Pooling and Servicing Agreement dated as of the Cut-off
Date specified above (the "Agreement") among the Depositor, Countrywide Home
Loans, Inc., as a seller ("CHL"), Park
C-2-3
Granada LLC, as a seller ("Park Granada"), Park Monaco, Inc., as a seller
("Park Monaco"), and Park Sienna LLC, as a seller ("Park Sienna" and, together
with CHL, Park Granada and Park Monaco, the "Sellers"), Countrywide Home Loans
Servicing LP, as master servicer (the "Master Servicer"), and The Bank of New
York, as trustee (the "Trustee"). To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the applicable Record
Date in an amount equal to the product of the Percentage Interest evidenced by
this Certificate and the amount required to be distributed to Holders of Class
P Certificates on such Distribution Date pursuant to Section 4.02 of the
Agreement. The Record Date applicable to each Distribution Date is the last
Business Day of the month immediately preceding such Distribution Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days
prior to the related Record Date and such Certificateholder shall hold 100% of
a Class of Regular Certificates or of Certificates with an aggregate Initial
Certificate Balance of $1,000,000 or more, or, if not, by check mailed by
first class mail to the address of such Certificateholder appearing in the
Certificate Register. The final distribution on each Certificate will be made
in like manner, but only upon presentment and surrender of such Certificate at
the Corporate Trust Office or such other location specified in the notice to
Certificateholders of such final distribution.
No transfer of a Class P Certificate shall be made unless such
transfer is made pursuant to an effective registration statement under the Act
and any applicable state securities laws or is exempt from the registration
requirements under the Act and such laws. In the event that a transfer is to
be made in reliance upon an exemption from the Act and such laws, in order to
assure compliance with the Act and such laws, the Certificateholder desiring
to effect such transfer and such Certificateholder's prospective transferee
shall each certify to the Trustee in writing the facts surrounding the
transfer. In the event that such a transfer is to be made within two years
from the date of the initial issuance of Certificates, there shall also be
delivered (except in the case of a transfer pursuant to Rule 144A of the
Regulations promulgated pursuant to the Act) to the Trustee an Opinion of
Counsel that such transfer may be made pursuant to an exemption from the Act
and such state securities laws, which Opinion of Counsel shall not be obtained
at the expense of the Trustee, the Master Servicer or the Depositor. The
Holder hereof desiring to effect such transfer shall, and does hereby agree
to, indemnify the Trustee, the
C-2-4
Certificate and the Depositor against any liability that may result if the
transfer is not so exempt or is not made in accordance with such federal and
state laws.
No transfer of a Class P Certificate shall be made unless the Trustee
shall have received either (i) a representation letter from the transferee of
a Class P Certificate, acceptable to and in form and substance satisfactory to
the Trustee, to the effect that such transferee is not an employee benefit
plan subject to Section 406 of ERISA or a plan or arrangement subject to
Section 4975 of the Code, or a person acting on behalf of or investing plan
assets of any such benefit plan or arrangement, which representation letter
shall not be an expense of the Trustee, the Master Servicer or the Trust Fund,
(ii) if such Class P Certificate has been the subject of an ERISA-Qualifying
Underwriting and the transferee is an insurance company, a representation that
the transferee is purchasing such Class P Certificate with funds contained in
an "insurance company general account" (as such term is defined in Section
V(e) of Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60")) and that
the purchase and holding of such Class P Certificate satisfy the requirements
for exemptive relief under Sections I and III of PTCE 95-60, or (iii) in the
case of a Class P Certificate presented for registration in the name of an
employee benefit plan subject to ERISA or a plan or arrangement subject to
Section 4975 of the Code (or comparable provisions of any subsequent
enactments), a trustee of any such benefit plan or arrangement or any other
person acting on behalf of any such benefit plan or arrangement, an Opinion of
Counsel satisfactory to the Trustee to the effect that the purchase and
holding of such Certificate will not result in a prohibited transaction under
Section 406 of ERISA or Section 4975 of the Code, and will not subject the
Trustee or the Master Servicer to any obligation in addition to those
undertaken in the Agreement, which Opinion of Counsel shall not be an expense
of the Trustee, the Master Servicer or the Trust Fund. Notwithstanding
anything else to the contrary herein, any purported transfer of a Class P
Certificate to or on behalf of an employee benefit plan subject to ERISA or a
plan or arrangement subject to Section 4975 of the Code without the opinion of
counsel satisfactory to the Trustee as described above shall be void and of no
effect.
This Class P Certificate may not be pledged or used as collateral for
any other obligation if it would cause any portion of the Trust Fund to be
treated as a taxable mortgage pool under Section 7701(i) of the Code.
Each Holder of this Class P Certificate will be deemed to have agreed
to be bound by the transfer restrictions set forth in the Agreement and all
other terms and provisions of the Agreement.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless the certificate of authentication
hereon has been manually executed by an authorized officer of the Trustee.
* * *
C-2-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: ____________, 20__
THE BANK OF NEW YORK,
as Trustee
By ______________________
Name:
Title:
Countersigned:
By ___________________________
Authorized Signatory of
THE BANK OF NEW YORK,
as Trustee
C-2-6
EXHIBIT C-3
[FORM OF CLASS C CERTIFICATE]
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986 (THE "CODE").
THIS CLASS C CERTIFICATE IS SUBORDINATE TO THE OFFERED CERTIFICATES TO THE
EXTENT DESCRIBED HEREIN AND IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
THIS CLASS C CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS UNTIL SUCH TIME AS
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CLASS C CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES LAWS OF
ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE
WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION
THAT DOES NOT REQUIRE SUCH REGISTRATION OR QUALIFICATION AND IN ACCORDANCE
WITH THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
TRANSFEREE DELIVERS TO THE TRUSTEE EITHER (A) A REPRESENTATION LETTER TO THE
EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR A
PLAN SUBJECT TO SECTION 4975 OF THE CODE NOR A PERSON ACTING ON BEHALF OF ANY
SUCH PLAN OR ARRANGEMENT OR USING THE ASSETS OF THAT PLAN OR ARRANGEMENT TO
EFFECT THAT TRANSFER, OR (B) AN OPINION OF COUNSEL IN ACCORDANCE WITH THE
PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN. NOTWITHSTANDING ANYTHING ELSE
TO THE CONTRARY HEREIN, ANY PURPORTED TRANSFER OF THIS CERTIFICATE TO OR ON
BEHALF OF AN EMPLOYEE BENEFIT PLAN SUBJECT TO ERISA OR A PLAN SUBJECT TO
SECTION 4975 OF THE CODE WITHOUT THE OPINION OF COUNSEL SATISFACTORY TO THE
TRUSTEE AS DESCRIBED ABOVE SHALL BE VOID AND OF NO EFFECT.
C-3-1
Certificate No. :
Initial Certificate Balance
of this Certificate
("Denomination") : $
Initial Certificate Balance
of all Certificates of
this Class : $
CUSIP :
ISIN :
Interest Rate :
Maturity Date :
CWALT, INC.
Alternative Loan Trust 200____-____
Mortgage Pass-Through Certificates, Series 200____-____
evidencing a percentage interest in the distributions allocable to
the Class C Certificates with respect to a Trust Fund consisting
primarily of a pool of conventional mortgage loans (the "Mortgage
Loans") secured by first and second liens on one- to four-family
residential properties
CWALT, Inc., as Depositor
This Certificate does not evidence an obligation of, or an interest
in, and is not guaranteed by the Depositor, the Master Servicer or the Trustee
referred to below or any of their respective affiliates. Neither this
Certificate nor the Mortgage Loans are guaranteed or insured by any
governmental agency or instrumentality.
This certifies that __________________ is the registered owner of the
Percentage Interest evidenced by this Certificate (obtained by dividing the
denomination of this Certificate by the aggregate Initial Notional Amount of
all Certificates of the Class to which this Certificate belongs) in certain
monthly distributions with respect to a Trust Fund consisting primarily of the
Mortgage Loans deposited by CWALT, Inc. (the "Depositor"). The Trust Fund was
created pursuant to a Pooling and Servicing Agreement dated as of the Cut-off
Date specified above (the "Agreement") among the Depositor, Countrywide Home
Loans, Inc., as a seller ("CHL"), Park Granada LLC, as a seller ("Park
Granada"), Park Monaco, Inc., as a seller ("Park Monaco"), and Park Sienna
LLC, as a seller ("Park Sienna" and,
C-3-2
together with CHL, Park Granada and Park Monaco, the "Sellers"), Countrywide
Home Loans Servicing LP, as master servicer (the "Master Servicer"), and The
Bank of New York, as trustee (the "Trustee"). To the extent not defined
herein, the capitalized terms used herein have the meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the applicable Record
Date in an amount equal to the product of the Percentage Interest evidenced by
this Certificate and the amount required to be distributed to Holders of Class
C Certificates on such Distribution Date pursuant to Section 4.02 of the
Agreement. The Record Date applicable to each Distribution Date is the last
Business Day of the month immediately preceding such Distribution Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days
prior to the related Record Date and such Certificateholder shall hold 100% of
a Class of Regular Certificates or of Certificates with an aggregate Initial
Certificate Balance of $1,000,000 or more, or, if not, by check mailed by
first class mail to the address of such Certificateholder appearing in the
Certificate Register. The final distribution on each Certificate will be made
in like manner, but only upon presentment and surrender of such Certificate at
the Corporate Trust Office or such other location specified in the notice to
Certificateholders of such final distribution.
No transfer of a Class C Certificate shall be made unless such
transfer is made pursuant to an effective registration statement under the Act
and any applicable state securities laws or is exempt from the registration
requirements under the Act and such laws. In the event that a transfer is to
be made in reliance upon an exemption from the Act and such laws, in order to
assure compliance with the Act and such laws, the Certificateholder desiring
to effect such transfer and such Certificateholder's prospective transferee
shall each certify to the Trustee in writing the facts surrounding the
transfer. In the event that such a transfer is to be made within two years
from the date of the initial issuance of Certificates, there shall also be
delivered (except in the case of a transfer pursuant to Rule 144A of the
Regulations promulgated pursuant to the Act) to the Trustee an Opinion of
Counsel that such transfer may be made pursuant to an exemption from the Act
and such state securities laws, which Opinion of Counsel shall not be obtained
at the expense of the Trustee, the Master Servicer or the Depositor. The
Holder hereof desiring to effect such transfer shall, and does hereby agree
to, indemnify the Trustee, the Certificate and the Depositor against any
liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
No transfer of a Class C Certificate shall be made unless the Trustee
shall have received either (i) a representation from the transferee of such
Certificate acceptable to and in form and substance satisfactory to the
Trustee, to the effect that such transferee is not an employee benefit plan
subject to section 406 of ERISA or a plan subject to section 4975 of the Code,
or a Person acting on behalf of any such plan or using the assets of any such
plan, or (ii) in the case of any Class C Certificate presented for
registration in the name of an employee benefit plan subject to ERISA, or a
plan subject to section 4975 of the Code (or comparable provisions of any
subsequent enactments), or a trustee of any such plan or any
C-3-3
other person acting on behalf of or investing plan assets of any such plan, an
Opinion of Counsel satisfactory to the Trustee to the effect that the purchase
or holding of such Class C Certificate will not result in a non-exempt
prohibited transaction under ERISA or Section 4975 of the Code and will not
subject the Trustee to any obligation in addition to those expressly
undertaken in the Agreement, which Opinion of Counsel shall not be an expense
of the Trustee. Notwithstanding anything else to the contrary herein, any
purported transfer of a Class C Certificate to or on behalf of an employee
benefit plan subject to section 406 of ERISA or a plan subject to section 4975
of the Code without the delivery to the Trustee of an Opinion of Counsel
satisfactory to the Trustee as described above shall be void and of no effect.
This Class C Certificate may not be pledged or used as collateral for
any other obligation if it would cause any portion of the Trust Fund to be
treated as a taxable mortgage pool under Section 7701(i) of the Code.
Each Holder of this Class C Certificate will be deemed to have agreed
to be bound by the transfer restrictions set forth in the Agreement and all
other terms and provisions of the Agreement.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless the certificate of authentication
hereon has been manually executed by an authorized officer of the Trustee.
* * *
C-3-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: ____________, 20__
THE BANK OF NEW YORK,
as Trustee
By ______________________
Name:
Title:
Countersigned:
By ___________________________
Authorized Signatory of
THE BANK OF NEW YORK,
as Trustee
C-3-5
EXHIBIT D
[FORM OF NOTIONAL AMOUNT CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE HAS NO PRINCIPAL BALANCE AND IS NOT ENTITLED TO ANY
DISTRIBUTION IN RESPECT OF PRINCIPAL.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE").
[UNTIL THIS CERTIFICATE HAS BEEN THE SUBJECT OF AN ERISA-QUALIFYING
UNDERWRITING, NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE
TRANSFERRED UNLESS THE TRANSFEREE DELIVERS TO THE TRUSTEE EITHER (A) A
REPRESENTATION LETTER TO THE EFFECT THAT SUCH TRANSFEREE IS NOT, AND IS NOT
INVESTING ASSETS OF, AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR A PLAN OR
ARRANGEMENT SUBJECT TO SECTION 4975 OF THE CODE, OR (B) AN OPINION OF COUNSEL
IN ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN. SUCH
REPRESENTATION SHALL BE DEEMED TO HAVE BEEN MADE TO THE TRUSTEE BY THE
TRANSFEREE'S ACCEPTANCE OF A CERTIFICATE OF THIS CLASS AND BY A BENEFICIAL
OWNER'S ACCEPTANCE OF ITS INTEREST IN A CERTIFICATE OF THIS CLASS.
NOTWITHSTANDING ANYTHING ELSE TO THE CONTRARY HEREIN, UNTIL THIS CERTIFICATE
HAS BEEN THE SUBJECT OF AN ERISA-QUALIFYING UNDERWRITING, ANY PURPORTED
TRANSFER OF THIS CERTIFICATE TO, OR A PERSON INVESTING ASSETS OF, AN EMPLOYEE
BENEFIT PLAN SUBJECT TO ERISA OR A PLAN OR ARRANGEMENT SUBJECT TO SECTION 4975
OF THE CODE WITHOUT THE OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE AS
DESCRIBED ABOVE SHALL BE VOID AND OF NO EFFECT.]
D-1
Certificate No. :
Cut-off Date :
First Distribution Date :
Initial Notional Amount
of this Certificate
("Denomination") : $
Initial Notional Amount
of all Certificates
of this Class : $
CUSIP :
Interest Rate : Interest Only
Maturity Date :
CWALT, INC.
Mortgage Pass-Through Certificates, Series 200____-____
Class [ ]
evidencing a percentage interest in the distributions allocable to
the Certificates of the above-referenced Class with respect to a
Trust Fund consisting primarily of a pool of conventional mortgage
loans (the "Mortgage Loans") secured by first liens on one- to
four-family residential properties
CWALT, Inc., as Depositor
The Notional Amount of this certificate at any time, may be less than
the Notional Amount as set forth herein. This Certificate does not evidence an
obligation of, or an interest in, and is not guaranteed by the Depositor, the
Sellers, the Master Servicer or the Trustee referred to below or any of their
respective affiliates. Neither this Certificate nor the Mortgage Loans are
guaranteed or insured by any governmental agency or instrumentality.
This certifies that________________ is the registered owner of the
Percentage Interest evidenced by this Certificate (obtained by dividing the
denomination of this Certificate by the aggregate Initial Notional Amount of
all Certificates of the Class to which this Certificate belongs) in certain
monthly distributions with respect to a Trust Fund consisting primarily of the
Mortgage Loans deposited by CWALT, Inc. (the "Depositor"). The Trust Fund was
created
D-2
pursuant to a Pooling and Servicing Agreement dated as of the Cut-off Date
specified above (the "Agreement") among the Depositor, Countrywide Home Loans,
Inc., as a seller ("CHL"), Park Granada LLC, as a seller ("Park Granada"),
Park Monaco, Inc., as a seller ("Park Monaco"), and Park Sienna LLC, as a
seller ("Park Sienna" and, together with CHL, Park Granada and Park Monaco,
the "Sellers"), Countrywide Home Loans Servicing LP, as master servicer (the
"Master Servicer"), and The Bank of New York, as trustee (the "Trustee"). To
the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
[Until this certificate has been the subject of an ERISA-Qualifying
Underwriting, no transfer of a Certificate of this Class shall be made unless
the Trustee shall have received either (i) a representation letter from the
transferee of such Certificate, acceptable to and in form and substance
satisfactory to the Trustee, to the effect that such transferee is not an
employee benefit plan subject to Section 406 of ERISA or a plan or arrangement
subject to Section 4975 of the Code, or a person acting on behalf of or
investing plan assets of any such benefit plan or arrangement, which
representation letter shall not be an expense of the Trustee, the Master
Servicer or the Trust Fund, or (ii) in the case of any such Certificate
presented for registration in the name of an employee benefit plan subject to
ERISA or a plan or arrangement subject to Section 4975 of the Code (or
comparable provisions of any subsequent enactments), a trustee of any such
benefit plan or arrangement or any other person acting on behalf of any such
benefit plan or arrangement, an Opinion of Counsel satisfactory to the Trustee
to the effect that the purchase and holding of such Certificate will not
result in a non-exempt prohibited transaction under Section 406 of ERISA or
Section 4975 of the Code, and will not subject the Trustee or the Master
Servicer to any obligation in addition to those undertaken in the Agreement,
which Opinion of Counsel shall not be an expense of the Trustee, the Master
Servicer or the Trust Fund. When the transferee delivers the Opinion of
Counsel described above, such representation shall be deemed to have been made
to the Trustee by the Transferee's acceptance of a Certificate of this Class
and by a beneficial owner's acceptance of its interest in a Certificate of
this Class. Notwithstanding anything else to the contrary herein, until such
certificate has been the subject of an ERISA-Qualifying Underwriting, any
purported transfer of a Certificate of this Class to, or a person investing
assets of, an employee benefit plan subject to ERISA or a plan or arrangement
subject to Section 4975 of the Code without the opinion of counsel
satisfactory to the Trustee as described above shall be void and of no
effect.]
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall
for all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.
* * *
D-3
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: ____________, 20__
THE BANK OF NEW YORK,
as Trustee
By __________________________
Countersigned:
By _________________________________
Authorized Signatory of
THE BANK OF NEW YORK,
as Trustee
D-4
EXHIBIT E
[FORM OF] REVERSE OF CERTIFICATES
CWALT, INC.
Mortgage Pass-Through Certificates
This Certificate is one of a duly authorized issue of Certificates
designated as CWALT, Inc. Mortgage Pass-Through Certificates, of the Series
specified on the face hereof (herein collectively called the "Certificates"),
and representing a beneficial ownership interest in the Trust Fund created by
the Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account
for payment hereunder and that the Trustee is not liable to the
Certificateholders for any amount payable under this Certificate or the
Agreement or, except as expressly provided in the Agreement, subject to any
liability under the Agreement.
This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced thereby, and the rights,
duties and immunities of the Trustee.
Pursuant to the terms of the Agreement, a distribution will be made
on the 25th day of each month or, if such day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on
the first Distribution Date specified on the face hereof, to the Person in
whose name this Certificate is registered at the close of business on the
applicable Record Date in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be
distributed to Holders of Certificates of the Class to which this Certificate
belongs on such Distribution Date pursuant to the Agreement. The Record Date
applicable to each Distribution Date is the last Business Day of the month
next preceding the month of such Distribution Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days
prior to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final
distribution on each Certificate will be made in like manner, but only upon
presentment and surrender of such Certificate at the Corporate Trust Office or
such other location specified in the notice to Certificateholders of such
final distribution.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any
time by the Depositor, the Master Servicer and the
E-1
Trustee with the consent of the Holders of Certificates affected by such
amendment evidencing the requisite Percentage Interest, as provided in the
Agreement. Any such consent by the Holder of this Certificate shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange therefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof,
in certain limited circumstances, without the consent of the Holders of any of
the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register of the Trustee upon surrender of this Certificate for
registration of transfer at the Corporate Trust Office or the office or agency
maintained by the Trustee in New York, New York, accompanied by a written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by the holder hereof or such holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations and evidencing the same aggregate Percentage
Interest in the Trust Fund will be issued to the designated transferee or
transferees.
The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations and evidencing the same aggregate Percentage Interest, as
requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange, but the Trustee may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
The Depositor, the Master Servicer, the Sellers and the Trustee and
any agent of the Depositor or the Trustee may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and
neither the Depositor, the Trustee, nor any such agent shall be affected by
any notice to the contrary.
On any Distribution Date on which the Pool Stated Principal Balance
is less than or equal to 10% of the Cut-off Date Pool Principal Balance, the
Master Servicer will have the option, subject to the limitations set forth in
the Agreement, to repurchase, in whole, from the Trust Fund all remaining
Mortgage Loans and all property acquired in respect of the Mortgage Loans at a
purchase price determined as provided in the Agreement. In the event that no
such optional termination occurs, the obligations and responsibilities created
by the Agreement will terminate upon the later of the maturity or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund or the disposition of all property in respect
thereof and the distribution to Certificateholders of all amounts required to
be distributed pursuant to the Agreement. In no event, however, will the trust
created by the Agreement continue beyond the
E-2
expiration of 21 years from the death of the last survivor of the descendants
living at the date of the Agreement of a certain person named in the
Agreement.
Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
E-3
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
unto____________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to
assignee on the Certificate Register of the Trust Fund.
I (We) further direct the Trustee to issue a new Certificate of a
like denomination and Class, to the above named assignee and deliver such
Certificate to the following address:
__________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of assignor
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to,_________________________________________________
________________________________________________________________________________
_______________________________________________________________________________,
for the account of_____________________________________________________________,
account number ________________________, or, if mailed by check, to____________.
Applicable statements should be mailed to______________________________________,
________________________________________________________________________________
_______________________________________________________________________________.
This information is provided by_______________________________________,
the assignee named above, or___________________________________________________,
as its agent.
E-4
STATE OF )
) ss.:
COUNTY OF )
On the _____day of ___________________, 20__ before me, a
notary public in and for said State, personally appeared
_____________________________________, known to me who, being by me duly
sworn, did depose and say that he executed the foregoing instrument.
_______________________________________
Notary Public
[Notarial Seal]
E-5
EXHIBIT F-1
[FORM OF] INITIAL CERTIFICATION OF TRUSTEE
[date]
[Depositor]
[Master Servicer]
[Countrywide]
_________________________
_________________________
Re: Pooling and Servicing Agreement among CWALT, Inc., as
Depositor, Countrywide Home Loans, Inc. ("Countrywide"), as
a Seller, Park Granada LLC, as a Seller, Park Monaco, Inc.,
as a Seller, Park Sienna LLC, as a Seller, Countrywide Home
Loans Servicing LP, as Master Servicer, and The Bank of New
York, as Trustee, Mortgage Pass-Through Certificates,
Series 200_-_ Gentlemen:
-----------------------------------------------------------
In accordance with Section 2.02 of the above-captioned Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement"), the undersigned,
as Trustee, hereby certifies that, as to each Initial Mortgage Loan listed in
the Mortgage Loan Schedule (other than any Initial Mortgage Loan paid in full
or listed on the attached schedule) it has received:
(i) (a) the original Mortgage Note endorsed in the following form:
"Pay to the order of __________, without recourse" or (b) with respect to any
Lost Mortgage Note, a lost note affidavit from Countrywide stating that the
original Mortgage Note was lost or destroyed; and
(ii) a duly executed assignment of the Mortgage (which may be
included in a blanket assignment or assignments).
Based on its review and examination and only as to the foregoing
documents, such documents appear regular on their face and related to such
Mortgage Loan.
The Trustee has made no independent examination of any documents
contained in each Mortgage File beyond the review specifically required in the
Pooling and Servicing Agreement.
F-1-1
The Trustee makes no representations as to: (i) the validity, legality,
sufficiency, enforceability or genuineness of any of the documents contained
in each Mortgage File of any of the Initial Mortgage Loans identified on the
Mortgage Loan Schedule, or (ii) the collectability, insurability,
effectiveness or suitability of any such Initial Mortgage Loan.
F-1-2
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Pooling and Servicing Agreement.
THE BANK OF NEW YORK,
as Trustee
By:______________________________
Name:
Title:
F-1-3
EXHIBIT F-2
[RESERVED]
F-2-1
EXHIBIT G-1
[FORM OF] DELAY DELIVERY CERTIFICATION
[date]
[Depositor]
[Master Servicer]
[Countrywide]
_________________________
_________________________
Re: Pooling and Servicing Agreement among CWALT, Inc., as
Depositor, Countrywide Home Loans, Inc. ("Countrywide"), as
a Seller, Park Granada LLC, as a Seller, Park Monaco, Inc.,
as a Seller, Park Sienna LLC, as a Seller, Countrywide Home
Loans Servicing LP, as Master Servicer, and The Bank of New
York, as Trustee, Mortgage Pass-Through Certificates,
Series 200_-_
-----------------------------------------------------------
Gentlemen:
Reference is made to the Initial Certification of Trustee relating to
the above-referenced series, with the schedule of exceptions attached thereto
(the "Schedule A"), delivered by the undersigned, as Trustee, on the Closing
Date in accordance with Section 2.02 of the above-captioned Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement"). The undersigned
hereby certifies that, as to each Delay Delivery Initial Mortgage Loan listed
on Schedule A attached hereto (other than any Initial Mortgage Loan paid in
full or listed on Schedule B attached hereto) it has received:
(i) the original Mortgage Note, endorsed by Countrywide or the
originator of such Mortgage Loan, without recourse in the
following form: "Pay to the order of _______________ without
recourse", with all intervening endorsements that show a
complete chain of endorsement from the originator to
Countrywide, or, if the original Mortgage Note has been lost
or destroyed and not replaced, an original lost note
affidavit from Countrywide, stating that the original
Mortgage Note was lost or destroyed, together with a copy of
the related Mortgage Note;
(ii) in the case of each Initial Mortgage Loan that is not a MERS
Mortgage Loan, the original recorded Mortgage, [and in the
case of each Initial Mortgage Loan that is a MERS Mortgage
Loan, the original Mortgage, noting thereon the presence of
G-1-1
the MIN of the Initial Mortgage Loan and language indicating
that the Initial Mortgage Loan is a MOM Loan if the Initial
Mortgage Loan is a MOM Loan, with evidence of recording
indicated thereon, or a copy of the Mortgage certified by
the public recording office in which such Mortgage has been
recorded];
(iii) in the case of each Initial Mortgage Loan that is not a MERS
Mortgage Loan, a duly executed assignment of the Mortgage to
"The Bank of New York, as trustee under the Pooling and
Servicing Agreement dated as of [month] 1, 2004, without
recourse", or, in the case of each Initial Mortgage Loan
with respect to property located in the State of California
that is not a MERS Mortgage Loan, a duly executed assignment
of the Mortgage in blank (each such assignment, when duly
and validly completed, to be in recordable form and
sufficient to effect the assignment of and transfer to the
assignee thereof, under the Mortgage to which such
assignment relates);
(iv) the original recorded assignment or assignments of the
Mortgage together with all interim recorded assignments of
such Mortgage [(noting the presence of a MIN in the case of
each MERS Mortgage Loan)];
(v) the original or copies of each assumption, modification,
written assurance or substitution agreement, if any, with
evidence of recording thereon if recordation thereof is
permissible under applicable law; and
(vi) the original or duplicate original lender's title policy or
a printout of the electronic equivalent and all riders
thereto or, in the event such original title policy has not
been received from the insurer, any one of an original title
binder, an original preliminary title report or an original
title commitment, or a copy thereof certified by the title
company, with the original policy of title insurance to be
delivered within one year of the Closing Date.
In the event that in connection with any Mortgage Loan that is not a
MERS Mortgage Loan Countrywide cannot deliver the original recorded Mortgage
or all interim recorded assignments of the Mortgage satisfying the
requirements of clause (ii), (iii) or (iv), as applicable, the Trustee has
received, in lieu thereof, a true and complete copy of such Mortgage and/or
such assignment or assignments of the Mortgage, as applicable, each certified
by Countrywide, the applicable title company, escrow agent or attorney, or the
originator of such Initial Mortgage Loan, as the case may be, to be a true and
complete copy of the original Mortgage or assignment of Mortgage submitted for
recording.
Based on its review and examination and only as to the foregoing
documents, (i) such documents appear regular on their face and related to such
Initial Mortgage Loan, and (ii) the information set forth in items (i), (iv),
(v), (vi), (viii), (xi) and (xiv) of the definition of the "Mortgage Loan
Schedule" in Article I of the Pooling and Servicing Agreement accurately
reflects information set forth in the Mortgage File.
The Trustee has made no independent examination of any documents
contained in each Mortgage File beyond the review specifically required in the
above-referenced Pooling and
G-1-2
Servicing Agreement. The Trustee makes no representations as to: (i) the
validity, legality, sufficiency, enforceability or genuineness of any of the
documents contained in each Mortgage File of any of the Initial Mortgage Loans
identified on the [Mortgage Loan Schedule][Loan Number and Borrower
Identification Mortgage Loan Schedule] or (ii) the collectibility,
insurability, effectiveness or suitability of any such Mortgage Loan.
G-1-3
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Pooling and Servicing Agreement.
THE BANK OF NEW YORK,
as Trustee
By:________________________
Name:
Title:
G-1-4
EXHIBIT G-2
[RESERVED]
G-2-1
EXHIBIT H-1
[FORM OF] FINAL CERTIFICATION OF TRUSTEE
[date]
[Depositor]
[Master Servicer]
[Countrywide]
_________________________
_________________________
Re: Pooling and Servicing Agreement among CWALT, Inc., as
Depositor, Countrywide Home Loans, Inc. ("Countrywide"), as
a Seller, Park Granada LLC, as a Seller, Park Monaco, Inc.,
as a Seller, Park Sienna LLC, as a Seller, Countrywide Home
Loans Servicing LP, as Master Servicer, and The Bank of New
York, as Trustee, Mortgage Pass-Through Certificates,
Series 200_-_
-----------------------------------------------------------
Gentlemen:
In accordance with Section 2.02 of the above-captioned Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement"), the undersigned,
as Trustee, hereby certifies that as to each Initial Mortgage Loan listed in
the Mortgage Loan Schedule (other than any Initial Mortgage Loan paid in full
or listed on the attached Document Exception Report) it has received:
(i) the original Mortgage Note, endorsed by Countrywide or the
originator of such Mortgage Loan, without recourse in the
following form: "Pay to the order of _______________ without
recourse", with all intervening endorsements that show a
complete chain of endorsement from the originator to
Countrywide, or, if the original Mortgage Note has been lost
or destroyed and not replaced, an original lost note
affidavit from Countrywide, stating that the original
Mortgage Note was lost or destroyed, together with a copy of
the related Mortgage Note;
(ii) in the case of each Initial Mortgage Loan that is not a MERS
Mortgage Loan, the original recorded Mortgage, [and in the
case of each Initial Mortgage Loan that is
H-1-1
a MERS Mortgage Loan, the original Mortgage, noting thereon
the presence of the MIN of the Mortgage Loan and language
indicating that the Mortgage Loan is a MOM Loan if the
Mortgage Loan is a MOM Loan, with evidence of recording
indicated thereon, or a copy of the Mortgage certified by
the public recording office in which such Mortgage has been
recorded];
(iii) in the case of each Initial Mortgage Loan that is not a MERS
Mortgage Loan, a duly executed assignment of the Mortgage to
"The Bank of New York, as trustee under the Pooling and
Servicing Agreement dated as of [month] 1, 2004, without
recourse", or, in the case of each Initial Mortgage Loan
with respect to property located in the State of California
that is not a MERS Mortgage Loan, a duly executed assignment
of the Mortgage in blank (each such assignment, when duly
and validly completed, to be in recordable form and
sufficient to effect the assignment of and transfer to the
assignee thereof, under the Mortgage to which such
assignment relates);
(iv) the original recorded assignment or assignments of the
Mortgage together with all interim recorded assignments of
such Mortgage [(noting the presence of a MIN in the case of
each Initial Mortgage Loan that is a MERS Mortgage Loan)];
(v) the original or copies of each assumption, modification,
written assurance or substitution agreement, if any, with
evidence of recording thereon if recordation thereof is
permissible under applicable law; and
(vi) the original or duplicate original lender's title policy or
a printout of the electronic equivalent and all riders
thereto or, in the event such original title policy has not
been received from the insurer, any one of an original title
binder, an original preliminary title report or an original
title commitment, or a copy thereof certified by the title
company, with the original policy of title insurance to be
delivered within one year of the Closing Date.
In the event that in connection with any Initial Mortgage Loan that
is not a MERS Mortgage Loan Countrywide cannot deliver the original recorded
Mortgage or all interim recorded assignments of the Mortgage satisfying the
requirements of clause (ii), (iii) or (iv), as applicable, the Trustee has
received, in lieu thereof, a true and complete copy of such Mortgage and/or
such assignment or assignments of the Mortgage, as applicable, each certified
by Countrywide, the applicable title company, escrow agent or attorney, or the
originator of such Initial Mortgage Loan, as the case may be, to be a true and
complete copy of the original Mortgage or assignment of Mortgage submitted for
recording.
Based on its review and examination and only as to the foregoing
documents, (i) such documents appear regular on their face and related to such
Initial Mortgage Loan, and (ii) the information set forth in items (i), (iv),
(v), (vi), (viii), (xi) and (xiv) of the definition of the
H-1-2
"Mortgage Loan Schedule" in Article I of the Pooling and Servicing Agreement
accurately reflects information set forth in the Mortgage File.
The Trustee has made no independent examination of any documents
contained in each Mortgage File beyond the review specifically required in the
above-referenced Pooling and Servicing Agreement. The Trustee makes no
representations as to: (i) the validity, legality, sufficiency, enforceability
or genuineness of any of the documents contained in each Mortgage File of any
of the Initial Mortgage Loans identified on the [Mortgage Loan Schedule][Loan
Number and Borrower Identification Mortgage Loan Schedule] or (ii) the
collectibility, insurability, effectiveness or suitability of any such Initial
Mortgage Loan.
H-1-3
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Pooling and Servicing Agreement.
THE BANK OF NEW YORK,
as Trustee
By:___________________________
Name:
Title:
X-0-0
XXXXXXX X-0
[RESERVED]
H-2-1
EXHIBIT I
[FORM OF] TRANSFER AFFIDAVIT
CWALT, Inc.
Mortgage Pass-Through Certificates
Series 200_-_
STATE OF )
) ss.:
COUNTY OF )
The undersigned, being first duly sworn, deposes and says as follows:
1. The undersigned is an officer of , the proposed Transferee of an
Ownership Interest in a Class A-R Certificate (the "Certificate") issued
pursuant to the Pooling and Servicing Agreement, dated as of _________ __,
2___ (the "Agreement"), by and among CWALT, Inc., as depositor (the
"Depositor"), Countrywide Home Loans, Inc. (the "Company"), as a Seller, Park
Granada LLC, as a Seller, Park Monaco, Inc., as a Seller, Park Sienna LLC, as
a Seller (and together with the Company, Park Granada and Park Monaco, the
"Sellers"), Countrywide Home Loans Servicing LP, as Master Servicer and The
Bank of New York, as Trustee. Capitalized terms used, but not defined herein
or in Exhibit 1 hereto, shall have the meanings ascribed to such terms in the
Agreement. The Transferee has authorized the undersigned to make this
affidavit on behalf of the Transferee.
2. The Transferee is not an employee benefit plan that is subject to
Title I of ERISA or to section 4975 of the Internal Revenue Code of 1986, nor
is it acting on behalf of or with plan assets of any such plan. The Transferee
is, as of the date hereof, and will be, as of the date of the Transfer, a
Permitted Transferee. The Transferee will endeavor to remain a Permitted
Transferee for so long as it retains its Ownership Interest in the
Certificate. The Transferee is acquiring its Ownership Interest in the
Certificate for its own account.
3. The Transferee has been advised of, and understands that (i) a tax
will be imposed on Transfers of the Certificate to Persons that are not
Permitted Transferees; (ii) such tax will be imposed on the transferor, or, if
such Transfer is through an agent (which includes a broker, nominee or
middleman) for a Person that is not a Permitted Transferee, on the agent; and
(iii) the Person otherwise liable for the tax shall be relieved of liability
for the tax if the subsequent Transferee furnished to such Person an affidavit
that such subsequent Transferee is a Permitted Transferee and, at the time of
Transfer, such Person does not have actual knowledge that the affidavit is
false.
4. The Transferee has been advised of, and understands that a tax
will be imposed on a "pass-through entity" holding the Certificate if at any
time during the taxable year of the pass-through entity a Person that is not a
Permitted Transferee is the record holder of an
I-1
interest in such entity. The Transferee understands that such tax will not be
imposed for any period with respect to which the record holder furnishes to
the pass-through entity an affidavit that such record holder is a Permitted
Transferee and the pass-through entity does not have actual knowledge that
such affidavit is false. (For this purpose, a "pass-through entity" includes a
regulated investment company, a real estate investment trust or common trust
fund, a partnership, trust or estate, and certain cooperatives and, except as
may be provided in Treasury Regulations, persons holding interests in
pass-through entities as a nominee for another Person.)
5. The Transferee has reviewed the provisions of Section 5.02(c) of
the Agreement (attached hereto as Exhibit 2 and incorporated herein by
reference) and understands the legal consequences of the acquisition of an
Ownership Interest in the Certificate including, without limitation, the
restrictions on subsequent Transfers and the provisions regarding voiding the
Transfer and mandatory sales. The Transferee expressly agrees to be bound by
and to abide by the provisions of Section 5.02(c) of the Agreement and the
restrictions noted on the face of the Certificate. The Transferee understands
and agrees that any breach of any of the representations included herein shall
render the Transfer to the Transferee contemplated hereby null and void.
6. The Transferee agrees to require a Transfer Affidavit from any
Person to whom the Transferee attempts to Transfer its Ownership Interest in
the Certificate, and in connection with any Transfer by a Person for whom the
Transferee is acting as nominee, trustee or agent, and the Transferee will not
Transfer its Ownership Interest or cause any Ownership Interest to be
Transferred to any Person that the Transferee knows is not a Permitted
Transferee. In connection with any such Transfer by the Transferee, the
Transferee agrees to deliver to the Trustee a certificate substantially in the
form set forth as Exhibit J-1 to the Agreement (a "Transferor Certificate") to
the effect that such Transferee has no actual knowledge that the Person to
which the Transfer is to be made is not a Permitted Transferee.
7. The Transferee does not have the intention to impede the
assessment or collection of any tax legally required to be paid with respect
to the Class A-R Certificates.
8. The Transferee's taxpayer identification number is ______________.
9. The Transferee is a U.S. Person as defined in Code section
7701(a)(30) and, unless the Transferor (or any subsequent transferor)
expressly waives such requirement, will not cause income from the Certificate
to be attributable to a foreign permanent establishment or fixed base (within
the meaning of an applicable income tax treaty) of the Transferee or another
U.S. taxpayer.
10. The Transferee is aware that the Class A-R Certificates may be
"noneconomic residual interests" within the meaning of Treasury Regulation
Section 1.860E-1(c) and that the transferor of a noneconomic residual interest
will remain liable for any taxes due with respect to the income on such
residual interest, unless no significant purpose of the transfer was to impede
the assessment or collection of tax. In addition, as the Holder of a
I-2
noneconomic residual interest, the Transferee may incur tax liabilities in
excess of any cash flows generated by the interest and the Transferee hereby
represents that it intends to pay taxes associated with holding the residual
interest as they become due.
11. The Transferee has provided financial statements or other
financial information requested by the Transferor in connection with the
transfer of the Certificate to permit the Transferor to assess the financial
capability of the Transferee to pay such taxes. The Transferee historically
has paid its debts as they have come due and intends to pay its debts as they
come due in the future.
12. Unless the Transferor (or any subsequent transferor) expressly
waives such requirement, the Transferee (and any subsequent transferee)
certifies (or will certify), respectively, that the transfer satisfies either
the "Asset Test" imposed by Treasury Regulation ss. 1.860E-1(c)(5) or the
"Formula Test" imposed by Treasury Regulation ss. 1.860E-1(c)(7).
* * *
I-3
IN WITNESS WHEREOF, the Transferee has caused this instrument to be
executed on its behalf by its duly authorized officer, this_____ day of
___________, 2___.
___________________________________
PRINT NAME OF TRANSFEREE
By: _______________________________
Name:
Title:
[Corporate Seal]
ATTEST:
_________________________________
[Assistant] Secretary
Personally appeared before me the above-named___________________ ,
known or proved to me to be the same person who executed the foregoing
instrument and to be the____________________ of the Transferee, and
acknowledged that he executed the same as his free act and deed and the free
act and deed of the Transferee.
Subscribed and sworn before me this______day of___________, 20__.
_______________________________________
NOTARY PUBLIC
My Commission expires the
___ day of________________, 20__
I-4
WAIVER OF REQUIREMENT THAT TRANSFEREE CERTIFIES TRANSFER OF CERTIFICATE
SATISFIES CERTAIN REGULATORY "SAFE HARBORS"
The Transferor hereby waives the requirement that the Transferee
certify that the transfer of the Certificate satisfies either the "Asset Test"
imposed by Treasury Regulation ss. 1.860E-1(c)(5) or the "Formula Test"
imposed by Treasury Regulation ss. 1.860E-1(c)(7).
CWALT, INC.
By: ______________________________
Name:
Title:
I-5
EXHIBIT 1 to
EXHIBIT I
Certain Definitions
"Asset Test": A transfer satisfies the Asset Test if: (i) At the time
of the transfer, and at the close of each of the transferee's two fiscal years
preceding the transferee's fiscal year of transfer, the transferee's gross
assets for financial reporting purposes exceed $100 million and its net assets
for financial reporting purposes exceed $10 million. The gross assets and net
assets of a transferee do not include any obligation of any "related person"
or any other asset if a principal purpose for holding or acquiring the other
asset is to permit the transferee to satisfy such monetary conditions; (ii)
The transferee must be an "eligible corporation" and must agree in writing
that any subsequent transfer of the interest will be to another eligible
corporation in a transaction that satisfies paragraphs 9 through 11 of this
Transfer Affidavit and the Asset Test. A transfer fails to meet the Asset Test
if the transferor knows, or has reason to know, that the transferee will not
honor the restrictions on subsequent transfers of the Certificate; and (iii) A
reasonable person would not conclude, based on the facts and circumstances
known to the transferor on or before the date of the transfer, that the taxes
associated with the Certificate will not be paid. The consideration given to
the transferee to acquire the Certificate is only one factor to be considered,
but the transferor will be deemed to know that the transferee cannot or will
not pay if the amount of consideration is so low compared to the liabilities
assumed that a reasonable person would conclude that the taxes associated with
holding the Certificate will not be paid. For purposes of applying the Asset
Test, (i) an "eligible corporation" means any domestic C corporation (as
defined in section 1361(a)(2) of the Code) other than (A) a corporation which
is exempt from, or is not subject to, tax under section 11 of the Code, (B) an
entity described in section 851(a) or 856(a) of the Code, (C) A REMIC, or (D)
an organization to which part I of subchapter T of chapter 1 of subtitle A of
the Code applies; (ii) a "related person" is any person that (A) bears a
relationship to the transferee enumerated in section 267(b) or 707(b)(1) of
the Code, using "20 percent" instead of "50 percent" where it appears under
the provisions, or (B) is under common control (within the meaning of section
52(a) and (b)) with the transferee.
"Formula Test": A transfer satisfies the formula test if the present
value of the anticipated tax liabilities associated with holding the
Certificate does not exceed the sum of (i) the present value of any
consideration given to the transferee to acquire the Certificate; (ii) the
present value of the expected future distributions on the Certificate; and
(iii) the present value of the anticipated tax savings associated with holding
the Certificate as the issuing REMIC generates losses. For purposes of
applying the Formula Test: (i) The transferee is assumed to pay tax at a rate
equal to the highest rate of tax specified in section 11(b)(1) of the Code. If
the transferee has been subject to the alternative minimum tax under section
55 of the Code in the preceding two years and will compute its taxable income
in the current taxable year using the alternative minimum tax rate, then the
tax rate specified in section 55(b)(1)(B) of the Code may be used in lieu of
the highest rate specified in section 11(b)(1) of the Code; (ii) The transfer
must satisfy paragraph 9 of the Transfer Affidavit; and (iii) Present values
are computed using a
I-6
discount rate equal to the Federal short-term rate prescribed by section
1274(d) of the Code for the month of the transfer and the compounding period
used by the taxpayer.
"Ownership Interest": As to any Certificate, any ownership interest
in such Certificate, including any interest in such Certificate as the Holder
thereof and any other interest therein, whether direct or indirect, legal or
beneficial.
"Permitted Transferee": Any person other than (i) the United States,
any State or political subdivision thereof, or any agency or instrumentality
of any of the foregoing, (ii) a foreign government, International Organization
or any agency or instrumentality of either of the foregoing, (iii) an
organization (except certain farmers' cooperatives described in section 521 of
the Code) that is exempt from tax imposed by Chapter 1 of the Code (including
the tax imposed by section 511 of the Code on unrelated business taxable
income) on any excess inclusions (as defined in section 860E(c)(1) of the
Code) with respect to any Class A-R Certificate, (iv) rural electric and
telephone cooperatives described in section 1381(a)(2)(C) of the Code, (v) an
"electing large partnership" as defined in section 775 of the Code, (vi) a
Person that is not a citizen or resident of the United States, a corporation,
partnership, or other entity (treated as a corporation or a partnership for
federal income tax purposes) created or organized in or under the laws of the
United States, any state thereof or the District of Columbia, or an estate
whose income from sources without the United States is includible in gross
income for United States federal income tax purposes regardless of its
connection with the conduct of a trade or business within the United States,
or a trust if a court within the United States is able to exercise primary
supervision over the administration of the trust and one or more United States
persons have authority to control all substantial decisions of the trustor
unless such Person has furnished the transferor and the Trustee with a duly
completed Internal Revenue Service Form W-8ECI, and (vii) any other Person so
designated by the Trustee based upon an Opinion of Counsel that the Transfer
of an Ownership Interest in a Class A-R Certificate to such Person may cause
any REMIC formed under the Agreement to fail to qualify as a REMIC at any time
that any Certificates are Outstanding. The terms "United States," "State" and
"International Organization" shall have the meanings set forth in section 7701
of the Code or successor provisions. A corporation will not be treated as an
instrumentality of the United States or of any State or political subdivision
thereof for these purposes if all of its activities are subject to tax and,
with the exception of the Federal Home Loan Mortgage Corporation, a majority
of its board of directors is not selected by such government unit.
"Person": Any individual, corporation, limited liability company,
partnership, joint venture, bank, joint stock company, trust (including any
beneficiary thereof), unincorporated organization or government or any agency
or political subdivision thereof.
"Transfer": Any direct or indirect transfer or sale of any Ownership
Interest in a Certificate, including the acquisition of a Certificate by the
Depositor.
"Transferee": Any Person who is acquiring by Transfer any Ownership
Interest in a Certificate.
I-7
EXHIBIT 2 to
EXHIBIT I
Section 5.02(c) of the Agreement
(c) Each Person who has or who acquires any Ownership Interest in a
Class A-R Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions, and
the rights of each Person acquiring any Ownership Interest in a Class A-R
Certificate are expressly subject to the following provisions:
(1) Each Person holding or acquiring any Ownership Interest
in a Class A-R Certificate shall be a Permitted Transferee and shall
promptly notify the Trustee of any change or impending change in its
status as a Permitted Transferee.
(2) Except in connection with (i) the registration of the
Tax Matters Person Certificate in the name of the Trustee or (ii) any
registration in the name of, or transfer of a Class A-R Certificate
to, an affiliate of the Depositor (either directly or through a
nominee) in connection with the initial issuance of the Certificates,
no Ownership Interest in a Class A-R Certificate may be registered on
the Closing Date or thereafter transferred, and the Trustee shall not
register the Transfer of any Class A-R Certificate unless, the
Trustee shall have been furnished with an affidavit (a "Transfer
Affidavit") of the initial owner or the proposed transferee in the
form attached hereto as Exhibit I.
(3) Each Person holding or acquiring any Ownership Interest
in a Class A-R Certificate shall agree (A) to obtain a Transfer
Affidavit from any other Person to whom such Person attempts to
Transfer its Ownership Interest in a Class A-R Certificate, (B) to
obtain a Transfer Affidavit from any Person for whom such Person is
acting as nominee, trustee or agent in connection with any Transfer
of a Class A-R Certificate and (C) not to Transfer its Ownership
Interest in a Class A-R Certificate, or to cause the Transfer of an
Ownership Interest in a Class A-R Certificate to any other Person, if
it has actual knowledge that such Person is not a Permitted
Transferee.
(4) Any attempted or purported Transfer of any Ownership
Interest in a Class A-R Certificate in violation of the provisions of
this Section 5.02(c) shall be absolutely null and void and shall vest
no rights in the purported Transferee. If any purported transferee
shall become a Holder of a Class A-R Certificate in violation of the
provisions of this Section 5.02(c), then the last preceding Permitted
Transferee shall be restored to all rights as Holder thereof
retroactive to the date of registration of Transfer of such Class A-R
Certificate. The Trustee shall be under no liability to any Person
for any registration of Transfer of a Class A-R Certificate that is
in fact not permitted by Section 5.02(b) and this Section 5.02(c) or
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
after receipt of the related Transfer Affidavit and Transferor
Certificate. The Trustee shall be entitled but not obligated to
recover from any Holder of a Class A-R Certificate that was in fact
not a Permitted
I-8
Transferee at the time it became a Holder or, at such subsequent time
as it became other than a Permitted Transferee, all payments made on
such Class A-R Certificate at and after either such time. Any such
payments so recovered by the Trustee shall be paid and delivered by
the Trustee to the last preceding Permitted Transferee of such
Certificate.
(5) The Depositor shall use its best efforts to make
available, upon receipt of written request from the Trustee, all
information necessary to compute any tax imposed under section
860E(e) of the Code as a result of a Transfer of an Ownership
Interest in a Class A-R Certificate to any Holder who is not a
Permitted Transferee.
The restrictions on Transfers of a Class A-R Certificate set forth in
this section 5.02(c) shall cease to apply (and the applicable portions of the
legend on a Class A-R Certificate may be deleted) with respect to Transfers
occurring after delivery to the Trustee of an Opinion of Counsel, which
Opinion of Counsel shall not be an expense of the Trustee, the Sellers or the
Master Servicer, to the effect that the elimination of such restrictions will
not cause any constituent REMIC of any REMIC formed hereunder to fail to
qualify as a REMIC at any time that the Certificates are outstanding or result
in the imposition of any tax on the Trust Fund, a Certificateholder or another
Person. Each Person holding or acquiring any ownership Interest in a Class A-R
Certificate hereby consents to any amendment of this Agreement that, based on
an Opinion of Counsel furnished to the Trustee, is reasonably necessary (a) to
ensure that the record ownership of, or any beneficial interest in, a Class
A-R Certificate is not transferred, directly or indirectly, to a Person that
is not a Permitted Transferee and (b) to provide for a means to compel the
Transfer of a Class A-R Certificate that is held by a Person that is not a
Permitted Transferee to a Holder that is a Permitted Transferee.
I-9
EXHIBIT J-1
[FORM OF] TRANSFEROR CERTIFICATE
(RESIDUAL)
____________________
Date
CWALT, Inc.
0000 Xxxx Xxxxxxx
Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxx
The Bank of New York
000 Xxxxxxx Xxxxxx - 0X
Xxx Xxxx, Xxx Xxxx 00000
Attention: Mortgage-Backed Securities Group
Series 200_-_
Re:CWALT, Inc. Mortgage Pass-Through Certificates,
Series 200_-_, Class
--------------------------------------------------
Ladies and Gentlemen:
In connection with our disposition of the above Certificates we
certify that to the extent we are disposing of a Class A-R Certificate, we
have no knowledge the Transferee is not a Permitted Transferee.
Very truly yours,
_______________________________________
Print Name of Transferor
By: ___________________________________
Authorized Officer
J-1-1
EXHIBIT J-2
[FORM OF] TRANSFEROR CERTIFICATE
(PRIVATE)
____________________
Date
CWALT, Inc.
0000 Xxxx Xxxxxxx
Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxx
The Bank of New York
000 Xxxxxxx Xxxxxx - 0X
Xxx Xxxx, Xxx Xxxx 00000
Attention: Mortgage-Backed Securities Group
Series 200_-_
Re:CWALT, Inc. Mortgage Pass-Through Certificates,
Series 200_-_, Class
--------------------------------------------------
Ladies and Gentlemen:
In connection with our disposition of the above Certificates we
certify that (a) we understand that the Certificates have not been registered
under the Securities Act of 1933, as amended (the "Act"), and are being
disposed by us in a transaction that is exempt from the registration
requirements of the Act, (b) we have not offered or sold any Certificates to,
or solicited offers to buy any Certificates from, any person, or otherwise
approached or negotiated with any person with respect thereto, in a manner
that would be deemed, or taken any other action which would result in, a
violation of Section 5 of the Act.
Very truly yours,
__________________________________________
Print Name of Transferor
By: ______________________________________
Authorized Officer
J-2-1
EXHIBIT K
[FORM OF] INVESTMENT LETTER (NON-RULE 144A)
________________________
Date
CWALT, Inc.
0000 Xxxx Xxxxxxx
Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxx
The Bank of New York
000 Xxxxxxx Xxxxxx - 0X
Xxx Xxxx, Xxx Xxxx 00000
Attention: Mortgage-Backed Securities Group
Series 200_-_
Re: CWALT, Inc. Mortgage Pass-Through Certificates,
Series 200_-_, Class
-----------------------------------------------
Ladies and Gentlemen:
In connection with our acquisition of the above Certificates we
certify that (a) we understand that the Certificates are not being registered
under the Securities Act of 1933, as amended (the "Act"), or any state
securities laws and are being transferred to us in a transaction that is
exempt from the registration requirements of the Act and any such laws, (b) we
are an "accredited investor," as defined in Regulation D under the Act, and
have such knowledge and experience in financial and business matters that we
are capable of evaluating the merits and risks of investments in the
Certificates, (c) we have had the opportunity to ask questions of and receive
answers from the Depositor concerning the purchase of the Certificates and all
matters relating thereto or any additional information deemed necessary to our
decision to purchase the Certificates, (d) either (i) we are not an employee
benefit plan that is subject to the Employee Retirement Income Security Act of
1974, as amended ("ERISA"), or a plan or arrangement that is subject to
Section 4975 of the Internal Revenue Code of 1986, as amended, nor are we
acting on behalf of or investing the assets of any such benefit plan or
arrangement to effect such acquisition or (ii) if the Certificates have been
the subject of an ERISA-Qualifying Underwriting and we are an insurance
company, we are purchasing such Certificates with funds contained in an
"insurance company general account" (as such term is defined in Section V(e)
of Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60")) and the
purchase and holding of such Certificates satisfy the requirements for
exemptive relief under Sections I and III of PTCE 95-60,
K-1
(e) we are acquiring the Certificates for investment for our own account and
not with a view to any distribution of such Certificates (but without
prejudice to our right at all times to sell or otherwise dispose of the
Certificates in accordance with clause (g) below), (f) we have not offered or
sold any Certificates to, or solicited offers to buy any Certificates from,
any person, or otherwise approached or negotiated with any person with respect
thereto, or taken any other action which would result in a violation of
Section 5 of the Act, and (g) we will not sell, transfer or otherwise dispose
of any Certificates unless (1) such sale, transfer or other disposition is
made pursuant to an effective registration statement under the Act or is
exempt from such registration requirements, and if requested, we will at our
expense provide an opinion of counsel satisfactory to the addressees of this
Certificate that such sale, transfer or other disposition may be made pursuant
to an exemption from the Act, (2) the purchaser or transferee of such
Certificate has executed and delivered to you a certificate to substantially
the same effect as this certificate, and (3) the purchaser or transferee has
otherwise complied with any conditions for transfer set forth in the Pooling
and Servicing Agreement.
Very truly yours,
________________________________________
Print Name of Transferee
By: ____________________________________
Authorized Officer
K-2
EXHIBIT L
[FORM OF] RULE 144A LETTER
________________________
Date
CWALT, Inc.
0000 Xxxx Xxxxxxx
Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxx
The Bank of New York
000 Xxxxxxx Xxxxxx - 0X
Xxx Xxxx, Xxx Xxxx 00000
Attention: Mortgage-Backed Securities Group
Series 200_-_
Re: CWALT, Inc. Mortgage Pass-Through Certificates,
Series 200_-_, Class
-----------------------------------------------
Ladies and Gentlemen:
In connection with our acquisition of the above Certificates we
certify that (a) we understand that the Certificates are not being registered
under the Securities Act of 1933, as amended (the "Act"), or any state
securities laws and are being transferred to us in a transaction that is
exempt from the registration requirements of the Act and any such laws, (b) we
have such knowledge and experience in financial and business matters that we
are capable of evaluating the merits and risks of investments in the
Certificates, (c) we have had the opportunity to ask questions of and receive
answers from the Depositor concerning the purchase of the Certificates and all
matters relating thereto or any additional information deemed necessary to our
decision to purchase the Certificates, (d) either (i) we are not an employee
benefit plan that is subject to the Employee Retirement Income Security Act of
1974, as amended ("ERISA"), or a plan or arrangement that is subject to
Section 4975 of the Internal Revenue Code of 1986, as amended, nor are we
acting on behalf of or investing the assets of any such benefit plan or
arrangement to effect such acquisition or (ii) if the Certificates have been
the subject of an ERISA-Qualifying Underwriting and we are an insurance
company, we are purchasing such Certificates with funds contained in an
"insurance company general account" (as such term is defined in Section V(e)
of Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60")) and the
purchase and holding of such Certificates satisfy the requirements for
exemptive relief under Sections I and III of PTCE 95-60, (e) we have not, nor
has anyone acting on our behalf offered, transferred, pledged, sold or
L-1
otherwise disposed of the Certificates, any interest in the Certificates or
any other similar security to, or solicited any offer to buy or accept a
transfer, pledge or other disposition of the Certificates, any interest in the
Certificates or any other similar security from, or otherwise approached or
negotiated with respect to the Certificates, any interest in the Certificates
or any other similar security with, any person in any manner, or made any
general solicitation by means of general advertising or in any other manner,
or taken any other action, that would constitute a distribution of the
Certificates under the Securities Act or that would render the disposition of
the Certificates a violation of Section 5 of the Securities Act or require
registration pursuant thereto, nor will act, nor has authorized or will
authorize any person to act, in such manner with respect to the Certificates,
(f) we are a "qualified institutional buyer" as that term is defined in Rule
144A under the Securities Act and have completed either of the forms of
certification to that effect attached hereto as Annex 1 or Annex 2. We are
aware that the sale to us is being made in reliance on Rule 144A. We are
acquiring the Certificates for our own account or for resale pursuant to Rule
144A and further, understand that such Certificates may be resold, pledged or
transferred only (i) to a person reasonably believed to be a qualified
institutional buyer that purchases for its own account or for the account of a
qualified institutional buyer to whom notice is given that the resale, pledge
or transfer is being made in reliance on Rule 144A, or (ii) pursuant to
another exemption from registration under the Securities Act.
Very truly yours,
__________________________________________
Print Name of Transferee
By: ______________________________________
Authorized Officer
L-2
ANNEX 1 TO EXHIBIT L
--------------------
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
--------------------------------------------------------
[For Transferees Other Than Registered Investment Companies]
The undersigned (the "Buyer") hereby certifies as follows to the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:
1. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the
Buyer.
2. In connection with purchases by the Buyer, the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("Rule 144A") because (i) the Buyer owned
and/or invested on a discretionary basis either at least $100,000 in
securities or, if Buyer is a dealer, Buyer must own and/or invest on a
discretionary basis at least $10,000,000 in securities (except for the
excluded securities referred to below) as of the end of the Buyer's most
recent fiscal year (such amount being calculated in accordance with Rule 144A
and (ii) the Buyer satisfies the criteria in the category marked below.
___ Corporation, etc. The Buyer is a corporation (other than a
bank, savings and loan association or similar institution),
Massachusetts or similar business trust, partnership, or
charitable organization described in Section 501(c)(3) of
the Internal Revenue Code of 1986, as amended.
___ Bank. The Buyer (a) is a national bank or banking
institution organized under the laws of any State, territory
or the District of Columbia, the business of which is
substantially confined to banking and is supervised by the
State or territorial banking commission or similar official
or is a foreign bank or equivalent institution, and (b) has
an audited net worth of at least $25,000,000 as demonstrated
in its latest annual financial statements, a copy of which
is attached hereto.
___ Savings and Loan. The Buyer (a) is a savings and loan
association, building and loan association, cooperative
bank, homestead association or similar institution, which is
supervised and examined by a State or Federal authority
having supervision over any such institutions or is a
foreign savings and loan association or equivalent
institution and (b) has an audited net worth of at least
$25,000,000 as demonstrated in its latest annual financial
statements, a copy of which is attached hereto.
L-3
___ Broker-dealer. The Buyer is a dealer registered pursuant to
Section 15 of the Securities Exchange Act of 1934.
___ Insurance Company. The Buyer is an insurance company whose
primary and predominant business activity is the writing of
insurance or the reinsuring of risks underwritten by
insurance companies and which is subject to supervision by
the insurance commissioner or a similar official or agency
of a State, territory or the District of Columbia.
___ State or Local Plan. The Buyer is a plan established and
maintained by a State, its political subdivisions, or any
agency or instrumentality of the State or its political
subdivisions, for the benefit of its employees.
___ ERISA Plan. The Buyer is an employee benefit plan within the
meaning of Title I of the Employee Retirement Income
Security Act of 1974.
___ Investment Advisor. The Buyer is an investment advisor
registered under the Investment Advisors Act of 1940.
___ Small Business Investment Company. Buyer is a small business
investment company licensed by the U.S. Small Business
Administration under Section 301(c) or (d) of the Small
Business Investment Act of 1958.
___ Business Development Company. Buyer is a business
development company as defined in Section 202(a)(22) of the
Investment Advisors Act of 1940.
3. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer, (ii) securities that
are part of an unsold allotment to or subscription by the Buyer, if the Buyer
is a dealer, (iii) securities issued or guaranteed by the U.S. or any
instrumentality thereof, (iv) bank deposit notes and certificates of deposit,
(v) loan participations, (vi) repurchase agreements, (vii) securities owned
but subject to a repurchase agreement and (viii) currency, interest rate and
commodity swaps.
4. For purposes of determining the aggregate amount of securities
owned and/or invested on a discretionary basis by the Buyer, the Buyer used
the cost of such securities to the Buyer and did not include any of the
securities referred to in the preceding paragraph, except (i) where the Buyer
reports its securities holdings in its financial statements on the basis of
their market value, and (ii) no current information with respect to the cost
of those securities has been published. If clause (ii) in the preceding
sentence applies, the securities may be valued at market. Further, in
determining such aggregate amount, the Buyer may have included securities
owned by subsidiaries of the Buyer, but only if such subsidiaries are
consolidated with the Buyer in its financial statements prepared in accordance
with generally accepted accounting principles and if the investments of such
subsidiaries are managed under the Buyer's direction. However, such securities
were not included if the Buyer is a majority-owned,
L-4
consolidated subsidiary of another enterprise and the Buyer is not itself a
reporting company under the Securities Exchange Act of 1934, as amended.
5. The Buyer acknowledges that it is familiar with Rule 144A and
understands that the seller to it and other parties related to the Certificates
are relying and will continue to rely on the statements made herein because one
or more sales to the Buyer may be in reliance on Rule 144A.
6. Until the date of purchase of the Rule 144A Securities, the Buyer
will notify each of the parties to which this certification is made of any
changes in the information and conclusions herein. Until such notice is given,
the Buyer's purchase of the Certificates will constitute a reaffirmation of this
certification as of the date of such purchase. In addition, if the Buyer is a
bank or savings and loan is provided above, the Buyer agrees that it will
furnish to such parties updated annual financial statements promptly after
they become available.
___________________________________________
Print Name of Buyer
By: ________________________________________
Name:
Title:
Date: ______________________________________
L-5
ANNEX 2 TO EXHIBIT L
--------------------
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
--------------------------------------------------------
[For Transferees That are Registered Investment Companies]
The undersigned (the "Buyer") hereby certifies as follows to the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:
1. As indicated below, the undersigned is the President,
Chief Financial Officer or Senior Vice President of the Buyer or, if
the Buyer is a "qualified institutional buyer" as that term is
defined in Rule 144A under the Securities Act of 1933, as amended
("Rule 144A") because Buyer is part of a Family of Investment
Companies (as defined below), is such an officer of the Adviser.
2. In connection with purchases by Buyer, the Buyer is a
"qualified institutional buyer" as defined in SEC Rule 144A because
(i) the Buyer is an investment company registered under the
Investment Company Act of 1940, as amended and (ii) as marked below,
the Buyer alone, or the Buyer's Family of Investment Companies, owned
at least $100,000,000 in securities (other than the excluded
securities referred to below) as of the end of the Buyer's most
recent fiscal year. For purposes of determining the amount of
securities owned by the Buyer or the Buyer's Family of Investment
Companies, the cost of such securities was used, except (i) where the
Buyer or the Buyer's Family of Investment Companies reports its
securities holdings in its financial statements on the basis of their
market value, and (ii) no current information with respect to the
cost of those securities has been published. If clause (ii) in the
preceding sentence applies, the securities may be valued at market.
___ The Buyer owned $______ in securities (other than the
excluded securities referred to below) as of the end of the
Buyer's most recent fiscal year (such amount being calculated
in accordance with Rule 144A).
___ The Buyer is part of a Family of Investment Companies which
owned in the aggregate $______ in securities (other than the
excluded securities referred to below) as of the end of the
Buyer's most recent fiscal year (such amount being
calculated in accordance with Rule 144A).
3. The term "Family of Investment Companies" as used herein
means two or more registered investment companies (or series thereof)
that have the same investment adviser or investment advisers that are
affiliated (by virtue of being majority owned subsidiaries of the
same parent or because one investment adviser is a majority owned
subsidiary of the other).
L-6
4. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer or are part
of the Buyer's Family of Investment Companies, (ii) securities issued
or guaranteed by the U.S. or any instrumentality thereof, (iii) bank
deposit notes and certificates of deposit, (iv) loan participations,
(v) repurchase agreements, (vi) securities owned but subject to a
repurchase agreement and (vii) currency, interest rate and commodity
swaps.
5. The Buyer is familiar with Rule 144A and understands that
the parties listed in the Rule 144A Transferee Certificate to which
this certification relates are relying and will continue to rely on
the statements made herein because one or more sales to the Buyer
will be in reliance on Rule 144A. In addition, the Buyer will only
purchase for the Buyer's own account.
6. Until the date of purchase of the Certificates, the
undersigned will notify the parties listed in the Rule 144A
Transferee Certificate to which this certification relates of any
changes in the information and conclusions herein. Until such notice
is given, the Buyer's purchase of the Certificates will constitute a
reaffirmation of this certification by the undersigned as of the date
of such purchase.
__________________________________________
Print Name of Buyer or Adviser
By: ______________________________________
Name:
Title:
IF AN ADVISER:
__________________________________________
Print Name of Buyer
Date: ____________________________________
L-7
EXHIBIT M
[FORM OF] REQUEST FOR RELEASE
(for Trustee)
CWALT, Inc.
Mortgage Pass-Through Certificates
Series 200_-_
Loan Information
Name of Mortgagor: ___________________________________________
Servicer Loan No.: ___________________________________________
Trustee
Name: ___________________________________________
Address: ___________________________________________
___________________________________________
___________________________________________
Trustee
Mortgage File No.:
___________________________________________
The undersigned Master Servicer hereby acknowledges that it has
received from The Bank of New York, as Trustee for the Holders of Mortgage
Pass-Through Certificates, of the above-referenced Series, the documents
referred to below (the "Documents"). All capitalized terms not otherwise
defined in this Request for Release shall have the meanings given them in the
Pooling and Servicing Agreement (the "Pooling and Servicing Agreement")
relating to the above-referenced Series among the Trustee, Countrywide Home
Loans, Inc., as a Seller, Park Granada LLC, as a Seller, Park Monaco, Inc., as
a Seller, Park Sienna LLC, as a Seller, Countrywide Home Loans Servicing LP,
as Master Servicer and CWALT, Inc., as Depositor.
( ) Mortgage Note dated _______________, 20__, in the original principal
sum of $___________, made by ____________________________, payable
to, or endorsed to the order of, the Trustee.
( ) Mortgage recorded on __________________ as instrument no.
______________________ in the County Recorder's Office of the County
of _________________________, State of _______________________ in
book/reel/docket _________________________ of official records at
page/image _______________________________.
M-1
( ) Deed of Trust recorded on ______________________ as instrument no.
___________ in the County Recorder's Office of the County of
__________________________, State of _____________________ in
book/reel/docket _________________________ of official records at
page/image ____________________________.
( ) Assignment of Mortgage or Deed of Trust to the Trustee, recorded on
_____________________ as instrument no. __________________ in the
County Recorder's Office of the County of _____________________,
State of ___________________ in book/reel/docket ________________ of
official records at page/image ______________________.
( ) Other documents, including any amendments, assignments or other
assumptions of the Mortgage Note or Mortgage.
( ) __________________________________________________________________
( ) __________________________________________________________________
( ) __________________________________________________________________
( ) __________________________________________________________________
The undersigned Master Servicer hereby acknowledges and agrees as
follows:
(1) The Master Servicer shall hold and retain possession of
the Documents in trust for the benefit of the Trustee, solely for the
purposes provided in the Agreement.
(2) The Master Servicer shall not cause or knowingly permit
the Documents to become subject to, or encumbered by, any claim,
liens, security interest, charges, writs of attachment or other
impositions nor shall the Servicer assert or seek to assert any
claims or rights of setoff to or against the Documents or any
proceeds thereof.
(3) The Master Servicer shall return each and every Document
previously requested from the Mortgage File to the Trustee when the
need therefor no longer exists, unless the Mortgage Loan relating to
the Documents has been liquidated and the proceeds thereof have been
remitted to the Certificate Account and except as expressly provided
in the Agreement.
(4) The Documents and any proceeds thereof, including any
proceeds of proceeds, coming into the possession or control of the
Master Servicer shall at all times be earmarked for the account of
the Trustee, and the Master Servicer shall keep the Documents and any
proceeds separate and distinct from all other property in the Master
Servicer's possession, custody or control.
M-2
COUNTRYWIDE HOME LOANS
SERVICING LP
By _____________________________
Its ____________________________
Date:_________________, 20__
M-3
EXHIBIT N
[FORM OF] REQUEST FOR RELEASE OF DOCUMENTS
To: The Bank of New York Attn: Mortgage Custody
Services
Re: The Pooling & Servicing Agreement dated [month] 1, 200_, among
Countrywide Home Loans, Inc., as a Seller, Park Granada LLC, as
a Seller, Park Monaco, Inc., as a Seller, Park Sienna LLC, as a
Seller, Countrywide Home Loans Servicing LP, as Master Servicer,
CWALT, Inc. and The Bank of New York, as Trustee
----------------------------------------------------------------
Ladies and Gentlemen:
In connection with the administration of the Mortgage Loans held by
you as Trustee for CWALT, Inc., we request the release of the Mortgage Loan
File for the Mortgage Loan(s) described below, for the reason indicated.
FT Account #: Pool #:
Mortgagor's Name, Address and Zip Code:
Mortgage Loan Number:
Reason for Requesting Documents (check one)
1. Mortgage Loan paid in full (Countrywide Home Loans, Inc.
hereby certifies that all amounts have been received).
2. Mortgage Loan Liquidated (Countrywide Home Loans, Inc.
hereby certifies that all proceeds of foreclosure,
insurance, or other liquidation have been finally received).
3. Mortgage Loan in Foreclosure.
4. Other (explain):
If item 1 or 2 above is checked, and if all or part of the Mortgage
File was previously released to us, please release to us our previous receipt
on file with you, as well as any additional documents in your possession
relating to the above-specified Mortgage Loan. If item 3 or 4 is checked, upon
return of all of the above documents to you as Trustee, please acknowledge
your receipt by signing in the space indicated below, and returning this form.
N-1
COUNTRYWIDE HOME LOANS, INC.
0000 Xxxx Xxxxxxx
Xxxxxxxxx, Xxxxxxxxxx 00000
By: ______________________________
Name: ____________________________
Title: ___________________________
Date: ____________________________
TRUSTEE CONSENT TO RELEASE AND
ACKNOWLEDGEMENT OF RECEIPT
By: ______________________________
Name: ____________________________
Title: ___________________________
Date: ____________________________
N-2
EXHIBIT O
[RESERVED]
O-1
EXHIBIT P
[RESERVED]
P-1
EXHIBIT Q
STANDARD & POOR'S LEVELS(R) VERSION 5.6c GLOSSARY REVISED, APPENDIX E
APPENDIX E - Standard & Poor's Predatory Lending Categories
-----------------------------------------------------------
Standard & Poor's has categorized loans governed by anti-predatory
lending laws in the Jurisdictions listed below into three categories based
upon a combination of factors that include (a) the risk exposure associated
with the assignee liability and (b) the tests and thresholds set forth in
those laws. Note that certain loans classified by the relevant statute as
Covered are included in Standard & Poor's High Cost Loan Category because they
included thresholds and tests that are typical of what is generally considered
High Cost by the industry.
Standard & Poor's High Cost Loan Categorization
-----------------------------------------------
----------------------------------------------------------------------------------------------------------------------
Category under Applicable
State/Jurisdiction Name of Anti-Predatory Lending Law/Effective Date Anti-Predatory Lending Law
----------------------------------------------------------------------------------------------------------------------
Arkansas Arkansas Home Loan Protection Act, Ark. Code Xxx. High Cost Home Loan
xx.xx. 00-00-000 et seq.
Effective July 16, 2003
----------------------------------------------------------------------------------------------------------------------
Cleveland Heights, OH Ordinance No. 72-2003 (PSH), Mun. Code xx.xx. Covered Loan
757.01 et seq.
Effective June 2, 2003
----------------------------------------------------------------------------------------------------------------------
Colorado Consumer Equity Protection, Colo. Stat. Covered Loan
Xxx. xx.xx. 5-3.5-101 et seq.
Effective for covered loans offered or
entered into on or after January 1, 2003.
Other provisions of the Act took effect on
June 7, 2002
----------------------------------------------------------------------------------------------------------------------
Connecticut Connecticut Abusive Home Loan High Cost Home Loan
Lending Practices Act, Conn. Gen. Stat
xx.xx. 36a-746 et seq.
Effective October 1, 2001
----------------------------------------------------------------------------------------------------------------------
District of Columbia Home Loan Protection Act, D.C. Code Covered Loan
xx.xx. 26-1151.01 et seq.
Effective for loans closed on or after January
28, 2003
----------------------------------------------------------------------------------------------------------------------
Q-1
Standard & Poor's High Cost Loan Categorization
-----------------------------------------------
----------------------------------------------------------------------------------------------------------------------
Category under Applicable
State/Jurisdiction Name of Anti-Predatory Lending Law/Effective Date Anti-Predatory Lending Law
----------------------------------------------------------------------------------------------------------------------
Florida Fair Lending Act, Fla. Stat. Xxx. xx.xx. High Cost Home Loan
494.0078 et seq.
Effective October 2, 2002
----------------------------------------------------------------------------------------------------------------------
Georgia (Oct. 1, 2002 - Mar. 0, Xxxxxxx Xxxx Xxxxxxx Xxx, Xx. Code High Cost Home Loan
2003) Xxx. xx.xx. 7-6A-1 et seq.
Effective October 1, 2002 - March 6, 2003
----------------------------------------------------------------------------------------------------------------------
Georgia as amended (Mar. 7, 0000 Xxxxxxx Xxxx Xxxxxxx Xxx, Xx. Code High Cost Home Loan
- current) Xxx. xx.xx. 7-6A-1 et seq.
Effective for loans closed on or after March 7,
2003
----------------------------------------------------------------------------------------------------------------------
HOEPA Section 32 Home Ownership and Equity Protection High Cost Loan
Act of 1994, 15 U.S.C. ss. 1639, 12
C.F.R. xx.xx. 226.32 and 226.34
Effective October 1, 1995, amendments
October 1, 2002
----------------------------------------------------------------------------------------------------------------------
Illinois High Risk Home Loan Act, Ill. Comp. High Risk Home Loan
Stat. tit. 815, xx.xx. 137/5 et seq.
Effective January 1, 2004 (prior to this
date, regulations under Residential
Mortgage License Act effective from May 14,
2001)
----------------------------------------------------------------------------------------------------------------------
Kansas Consumer Credit Code, Kan. Stat. Xxx. High Loan to Value Consumer
xx.xx. 16a-1-101 et seq. Loan (id. ss. 16a-3-207) and;
Sections 16a-1-301 and 16a-3-207 became
effective April 14, 1999; Section High APR Consumer Loan (id.
16a-3-308a became effective July 1, 1999 ss. 16a-3-308a)
----------------------------------------------------------------------------------------------------------------------
Kentucky 2003 KY H.B. 000 - Xxxx Xxxx Xxxx Xxxx Xxx, Xx. High Cost Home Loan
Rev. Stat. xx.xx. 360.100 et seq.
Effective June 24, 2003
----------------------------------------------------------------------------------------------------------------------
Q-2
Standard & Poor's High Cost Loan Categorization
-----------------------------------------------
----------------------------------------------------------------------------------------------------------------------
Category under Applicable
State/Jurisdiction Name of Anti-Predatory Lending Law/Effective Date Anti-Predatory Lending Law
----------------------------------------------------------------------------------------------------------------------
Maine Truth in Lending, Me. Rev. Stat. tit. 9 High Rate High Fee Mortgage
A, xx.xx. 8-101 et seq.
Effective September 29, 1995 and as amended from
time to time
----------------------------------------------------------------------------------------------------------------------
Massachusetts Part 40 and Part 32, 209 C.M.R. xx.xx. High Cost Home Loan
32.00 et seq. and 209 C.M.R. xx.xx. 40.01
et seq.
Effective March 22, 2001 and amended
from time to time
----------------------------------------------------------------------------------------------------------------------
Nevada Assembly Xxxx No. 284, Nev. Rev. Stat. Home Loan
xx.xx. 598D.010 et seq.
Effective October 1, 2003
----------------------------------------------------------------------------------------------------------------------
New Jersey New Jersey Home Ownership Security Act of 2002, High Cost Home Loan
N.J. Rev. Stat. xx.xx. 46:10B 22 et seq.
Effective for loans closed on or after November
27, 2003
----------------------------------------------------------------------------------------------------------------------
New Mexico Home Loan Protection Act, N.M. Rev. Stat. xx.xx. High Cost Home Loan
58-21A-1 et seq.
Effective as of January 1, 2004; Revised as of
February 26, 2004
----------------------------------------------------------------------------------------------------------------------
New York N.Y. Banking Law Article 6-l High Cost Home Loan
Effective for applications made on or
after April 1, 2003
----------------------------------------------------------------------------------------------------------------------
North Carolina Restrictions and Limitations on High Cost Home High Cost Home Loan
Loans, N.C. Gen. Stat. xx.xx. 24-1.1E et seq.
Effective July 1, 2000; amended October 1,
2003 (adding open-end lines of credit)
----------------------------------------------------------------------------------------------------------------------
Ohio H.B. 386 (codified in various sections of the Covered Loan
Ohio Code), Ohio Rev. Code Xxx.
----------------------------------------------------------------------------------------------------------------------
Q-3
Standard & Poor's High Cost Loan Categorization
-----------------------------------------------
----------------------------------------------------------------------------------------------------------------------
Category under Applicable
State/Jurisdiction Name of Anti-Predatory Lending Law/Effective Date Anti-Predatory Lending Law
----------------------------------------------------------------------------------------------------------------------
xx.xx. 1349.25 et seq.
Effective May 24, 2002
----------------------------------------------------------------------------------------------------------------------
Oklahoma Consumer Credit Code (codified in various Subsection 10 Mortgage
sections of Title 14A)
Effective July 1, 2000; amended effective January
1, 2004
----------------------------------------------------------------------------------------------------------------------
South Carolina South Carolina High Cost and Consumer Home Loans High Cost Home Loan
Act, S.C. Code
Xxx. xx.xx. 37-23-10 et seq.
Effective for loans taken on or after January 1,
2004
----------------------------------------------------------------------------------------------------------------------
West Virginia West Virginia Residential Mortgage Lender, Broker West Virginia Mortgage Loan
and Servicer Act, W. Va. Code Xxx. xx.xx. 31-17-1 Act Loan
et seq.
Effective June 5, 2002
----------------------------------------------------------------------------------------------------------------------
Standard & Poor's Covered Loan Categorization
---------------------------------------------
----------------------------------------------------------------------------------------------------------------------
Category under Applicable
State/Jurisdiction Name of Anti-Predatory Lending Law/Effective Date Anti-Predatory Lending Law
----------------------------------------------------------------------------------------------------------------------
Georgia (Oct. 1, 2002 - Mar. 0, Xxxxxxx Xxxx Xxxxxxx Xxx, Xx. Code Covered Loan
2003) Xxx. xx.xx. 7-6A-1 et seq.
Effective October 1, 2002 - March 6, 2003
----------------------------------------------------------------------------------------------------------------------
New Jersey New Jersey Home Ownership Security Act of 2002, Covered Home Loan
N.J. Rev. Stat. xx.xx. 46:10B
22 et seq. Effective November 27, 2003 - July 5,
2004
----------------------------------------------------------------------------------------------------------------------
Q-4
Standard & Poor's Home Loan Categorization
------------------------------------------
----------------------------------------------------------------------------------------------------------------------
Category under Applicable
State/Jurisdiction Name of Anti-Predatory Lending Law/Effective Date Anti-Predatory Lending Law
----------------------------------------------------------------------------------------------------------------------
Georgia (Oct. 1, 2002 - Mar. 0, Xxxxxxx Xxxx Xxxxxxx Xxx, Xx. Code Xxx. xx.xx. Home Loan
2003) 7-6A-1 et seq.
Effective October 1, 2002 - March 6, 2003
----------------------------------------------------------------------------------------------------------------------
New Jersey New Jersey Home Ownership Security Home Loan
Act of 2002, N.J. Rev. Stat. xx.xx. 46:10B 22
et seq.
Effective for loans closed on or after November
27, 2003
----------------------------------------------------------------------------------------------------------------------
New Mexico Home Loan Protection Act, N.M. Rev.Stat. xx.xx. Home Loan
58-21A-1 et seq.
Effective as of January 1, 2004; Revised as of
February 26, 2004
----------------------------------------------------------------------------------------------------------------------
North Carolina Restrictions and Limitations on High Cost Home Consumer Home Loan
Loans, N.C. Gen. Stat. xx.xx. 24-1.1E et seq.
Effective July 1, 2000; amended October 1,
2003 (adding open-end lines of credit)
----------------------------------------------------------------------------------------------------------------------
South Carolina South Carolina High Cost and Consumer Home Loans Consumer Home Loan
Act, S.C. Code
Xxx. xx.xx. 37-23-10 et seq.
Effective for loans taken on or after January 1,
2004
----------------------------------------------------------------------------------------------------------------------
Q-5
EXHIBIT R
[FORM OF] SWAP CONTRACT
Delivered to the Trustee at closing and on file with the Trustee.
R-1
EXHIBIT S-1
[FORM OF] SWAP CONTRACT ASSIGNMENT AGREEMENT
Delivered to the Trustee at closing and on file with the Trustee.
X-0-0
XXXXXXX X-0
[FORM OF] SWAP CONTRACT ADMINISTRATION AGREEMENT
Delivered to the Trustee at closing and on file with the Trustee.
S-2-1
EXHIBIT T
[FORM OF] OFFICER'S CERTIFICATE WITH RESPECT TO PREPAYMENTS
MORTGAGE BACKED CERTIFICATES,
Series 200_-__
[Date]
Via Facsimile
__________________,
as Trustee
_______________
_______________________
Dear Sir or Madam:
Reference is made to the Pooling and Servicing Agreement, dated as of
_________, 200_, (the "Pooling and Servicing Agreement") among [CWALT, Inc.],
as Depositor, [Countrywide Home Loans, Inc.], as a Seller, [Park Granada LLC],
as a Seller, [Park Monaco Inc.], as a Seller, [Park Sienna LLC], as a Seller,
[Countrywide Home Loans Servicing LP], as Master Servicer and
__________________, as Trustee. Capitalized terms used herein shall have the
meanings ascribed to such terms in the Pooling and Servicing Agreement.
__________________ hereby certifies that he/she is a Servicing
Officer, holding the office set forth beneath his/her name and hereby further
certifies as follows:
With respect to the Distribution Date in _________ 200_ and each
Mortgage Loan set forth in the attached schedule:
1. A Principal Prepayment in full or in part was received during the
related Prepayment Period;
2. Any Prepayment Charge due under the terms of the Mortgage Note
with respect to such Principal Prepayment was or was not, as indicated on the
attached schedule using "Yes" or "No", received from the Mortgagor and
deposited in the Certificate Account;
3. As to each Mortgage Loan set forth on the attached schedule for
which all or part of the Prepayment Charge required in connection with the
Principal Prepayment was waived by the Master Servicer, such waiver was, as
indicated on the attached schedule, based upon:
(i) the Master Servicer's determination that such waiver
would maximize recovery of Liquidation Proceeds for such Mortgage
Loan, taking into account the value of such Prepayment Charge, or
(ii)(A) the enforceability thereof is limited (1) by
bankruptcy, insolvency, moratorium, receivership, or other similar
law relating to creditors' rights generally or (2) due to
T-1
acceleration in connection with a foreclosure or other involuntary
payment, or (B) the enforceability is otherwise limited or prohibited
by applicable law; and
4. We certify that all amounts due in connection with the waiver of a
Prepayment Charge inconsistent with clause 3 above which are required to be
deposited by the Master Servicer pursuant to Section 3.19 of the Pooling and
Servicing Agreement, have been or will be so deposited.
[COUNTRYWIDE HOME LOANS, INC.],
as Master Servicer
T-2
SCHEDULE OF MORTGAGE LOANS FOR WHICH A PREPAYMENT WAS RECEIVED DURING THE
RELATED PREPAYMENT PERIOD
----------------------------------------------------------------------------------------------------------------------
Loan Number Clause 2: Yes/No Clause 3: (i) or (ii)
----------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------
T-3
EXHIBIT U
MONTHLY STATEMENT
[On file with Trustee]
U-1
EXHIBIT V-1
[FORM OF] PERFORMANCE CERTIFICATION
(Subservicer)
[On file with Trustee]
V-1-1
EXHIBIT V-2
[FORM OF] PERFORMANCE CERTIFICATION
(Trustee)
[On file with Trustee]
V-2-1
EXHIBIT W
[FORM OF]
SERVICING CRITERIA TO BE ADDRESSED IN
ASSESSMENT OF COMPLIANCE STATEMENT
The assessment of compliance to be delivered by [the Master
Servicer] [Trustee] [Name of Subservicer] shall address, at a minimum, the
criteria identified as below as "Applicable Servicing Criteria":
------------------------------------------------------------------------------------------------------------------
Servicing Criteria Applicable Servicing
Criteria
------------------------------------------------------------------------------------------------------------------
Reference Criteria
------------------------------------------------------------------------------------------------------------------
General Servicing Considerations
--------------------- ----------------------
1122(d)(1)(i) Policies and procedures are instituted to monitor any
performance or other triggers and events of default in
accordance with the transaction agreements.
--------------------- ----------------------
If any material servicing activities are outsourced to
third parties, policies and procedures are instituted to
monitor the third party's performance and compliance
1122(d)(1)(ii) with such servicing activities.
--------------------- ----------------------
Any requirements in the transaction agreements to maintain a
1122(d)(1)(iii) back-up servicer for the mortgage loans are maintained.
--------------------- ----------------------
A fidelity bond and errors and omissions policy is in
effect on the party participating in the servicing
function throughout the reporting period in the amount
of coverage required by and otherwise in accordance with
1122(d)(1)(iv) the terms of the transaction agreements.
--------------------- ----------------------
Cash Collection and Administration
--------------------- ----------------------
Payments on mortgage loans are deposited into the
appropriate custodial bank accounts and related bank
clearing accounts no more than two business days
following receipt, or such other number of
1122(d)(2)(i) days specified in the transaction agreements.
--------------------- ----------------------
Disbursements made via wire transfer on behalf of an obligor
1122(d)(2)(ii) or to an investor are made only by authorized personnel.
--------------------- ----------------------
Advances of funds or guarantees regarding collections,
cash flows or distributions, and any interest or other
fees charged for such advances, are made, reviewed and
approved as specified in the
1122(d)(2)(iii) transaction agreements.
--------------------- ----------------------
The related accounts for the transaction, such as cash
reserve accounts or accounts established as a form of
overcollateralization, are separately maintained (e.g.,
with respect to commingling of cash) as set forth in the
transaction
1122(d)(2)(iv) agreements.
--------------------- ----------------------
W-1
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Servicing Criteria Applicable Servicing
Criteria
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Reference Criteria
------------------------------------------------------------------------------------------------------------------
Each custodial account is maintained at a federally
insured depository institution as set forth in the
transaction agreements. For purposes of this criterion,
"federally insured depository institution" with respect
to a foreign financial institution means a foreign
financial institution that meets the requirements of
1122(d)(2)(v) Rule 13k-1(b)(1) of the Securities Exchange Act.
--------------------- ----------------------
Unissued checks are safeguarded so as to prevent unauthorized
1122(d)(2)(vi) access.
--------------------- ----------------------
Reconciliations are prepared on a monthly basis for all
sset-backed securities related bank accounts, including
ustodial accounts and related bank clearing accounts.
hese reconciliations are (A) mathematically accurate;
B) prepared within 30 calendar days after the bank
tatement cutoff date, or such other number of days
pecified in the transaction agreements; (C) reviewed
nd approved by someone other than the person who
repared the reconciliation; and (D) contain
xplanations for reconciling items. These reconciling
tems are resolved within 90 calendar days of their
riginal identification, or such other number of
1122(d)(2)(vii) days specified in the transaction agreements.
--------------------- ----------------------
Investor Remittances and Reporting
--------------------- ----------------------
Reports to investors, including those to be filed with
the Commission, are maintained in accordance with the
transaction agreements and applicable Commission
requirements. Specifically, such reports (A) are
prepared in accordance with timeframes and other terms
set forth in the transaction agreements; (B) provide
information calculated in accordance with the terms
specified in the transaction agreements; (C) are filed
with the Commission as required by its rules and
regulations; and (D) agree with investors' or the
trustee's records as to the total unpaid principal
balance and number of mortgage loans serviced by the
1122(d)(3)(i) Servicer.
--------------------- ----------------------
Amounts due to investors are allocated and remitted in
accordance with timeframes, distribution priority and
other terms set forth in the transaction agreements.
1122(d)(3)(ii)
--------------------- ----------------------
Disbursements made to an investor are posted within two
business days to the Servicer's investor records, or
such other number of days specified in the transaction
1122(d)(3)(iii) agreements.
--------------------- ----------------------
Amounts remitted to investors per the investor reports
agree with cancelled checks, or other form of payment,
or custodial bank statements.
1122(d)(3)(iv)
--------------------- ----------------------
Pool Asset Administration
--------------------- ----------------------
Collateral or security on mortgage loans is maintained as
required by the transaction agreements or related mortgage
W-2
------------------------------------------------------------------------------------------------------------------
Servicing Criteria Applicable Servicing
Criteria
------------------------------------------------------------------------------------------------------------------
Reference Criteria
------------------------------------------------------------------------------------------------------------------
1122(d)(4)(i) loan documents.
--------------------- ---------------------
Mortgage loan and related documents are safeguarded as
1122(d)(4)(ii) required by the transaction agreements.
--------------------- ----------------------
Any additions, removals or substitutions to the asset pool
are made, reviewed and approved in accordance with any
1122(d)(4)(iii) conditions or requirements in the transaction agreements.
--------------------- ----------------------
Payments on mortgage loans, including any payoffs, made
in accordance with the related mortgage loan documents
are posted to the Servicer's obligor records maintained
no more than two business days after receipt, or such
other number of days specified in the transaction
agreements, and allocated to principal, interest or
other items (e.g., escrow) in accordance
1122(d)(4)(iv) with the related mortgage loan documents.
--------------------- ----------------------
The Servicer's records regarding the mortgage loans
agree with the Servicer's records with respect to an
obligor's unpaid principal balance.
1122(d)(4)(v)
--------------------- ----------------------
Changes with respect to the terms or status of an
obligor's mortgage loans (e.g., loan modifications or
re-agings) are made, reviewed and approved by
authorized personnel in accordance with the
transaction agreements and related pool asset
documents.
1122(d)(4)(vi)
--------------------- ----------------------
Loss mitigation or recovery actions (e.g., forbearance
plans, modifications and deeds in lieu of foreclosure,
foreclosures and repossessions, as applicable) are
initiated, conducted and concluded in accordance with
the timeframes or other requirements
1122(d)(4)(vii) established by the transaction agreements.
--------------------- ----------------------
Records documenting collection efforts are maintained
during the period a mortgage loan is delinquent in
accordance with the transaction agreements. Such records
are maintained on at least a monthly basis, or such
other period specified in the transaction agreements,
and describe the entity's activities in monitoring
delinquent mortgage loans including, for example, phone
calls, letters and payment rescheduling plans in cases
where delinquency is deemed temporary (e.g., illness
or unemployment).
1122(d)(4)(viii)
--------------------- ----------------------
Adjustments to interest rates or rates of return for
mortgage loans with variable rates are computed based on
the related mortgage loan documents.
1122(d)(4)(ix)
--------------------- ----------------------
Regarding any funds held in trust for an obligor (such
as escrow accounts): (A) such funds are analyzed, in
accordance with the obligor's mortgage loan documents,
on at least an annual basis, or such other period
specified in the transaction agreements; (B) interest on
such funds is paid, or credited, to obligors in
accordance with applicable mortgage loan documents and
state laws; and (C) such funds are returned to the
obligor within 30 calendar days of full repayment of the
related mortgage loans, or such
1122(d)(4)(x) other number of days specified in the transaction agreements.
--------------------- ----------------------
W-3
------------------------------------------------------------------------------------------------------------------
Servicing Criteria Applicable Servicing
Criteria
------------------------------------------------------------------------------------------------------------------
Reference Criteria
------------------------------------------------------------------------------------------------------------------
Payments made on behalf of an obligor (such as tax or
insurance payments) are made on or before the related
penalty or expiration dates, as indicated on the
appropriate bills or notices for such payments, provided
that such support has been received by the servicer at
least 30 calendar days prior to these dates, or such
1122(d)(4)(xi) other number of days specified in the transaction agreements.
--------------------- ----------------------
Any late payment penalties in connection with any
payment to be made on behalf of an obligor are paid from
the servicer's funds and not charged to the obligor,
unless the late payment was due to
1122(d)(4)(xii) the obligor's error or omission.
--------------------- ----------------------
Disbursements made on behalf of an obligor are posted
within two business days to the obligor's records
maintained by the servicer, or such other number of days
specified in the transaction
1122(d)(4)(xiii) agreements.
--------------------- ----------------------
Delinquencies, charge-offs and uncollectible accounts are
recognized and recorded in accordance with the transaction
1122(d)(4)(xiv) agreements.
--------------------- ----------------------
Any external enhancement or other support, identified in
Item 1114(a)(1) through (3) or Item 1115 of Regulation
AB, is maintained as set forth in the transaction agreements.
1122(d)(4)(xv)
--------------------- -------------------------------------------------------------------- ----------------------
--------------------- -------------------------------------------------------------------- ----------------------
[NAME OF MASTER SERVICER] [NAME OF
TRUSTEE] [NAME OF CO-TRUSTEE] [NAME
OF SUBSERVICER]
Date: _________________________
By: ________________________________
Name:
Title:
W-4
EXHIBIT X
[FORM OF] LIST OF ITEM 1119 PARTIES
ALTERNATIVE LOAN TRUST 2006-OC1
MORTGAGE PASS-THROUGH CERTIFICATES,
Series 2006-OC1
[Date]
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Party Contact Information
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X-1
EXHIBIT Y
[FORM OF] XXXXXXXX-XXXXX CERTIFICATION
(Replacement Master Servicer)
[On file with Trustee]
Y-1
