EXHIBIT 99.1
------------
6
-------------------------------
CWALT, INC.,
Depositor
COUNTRYWIDE HOME LOANS, INC.,
Seller
PARK GRANADA LLC,
Seller
PARK MONACO INC.,
Seller
PARK SIENNA LLC,
Seller
COUNTRYWIDE HOME LOANS SERVICING LP,
Master Servicer
and
THE BANK OF NEW YORK,
Trustee
-----------------------------------
POOLING AND SERVICING AGREEMENT
Dated as of May 1, 2005
----------------------------------
ALTERNATIVE LOAN TRUST 2005-24
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2005-24
----------------------------------
Table of Contents
Page
----
ARTICLE I DEFINITIONS............................................................................................18
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES..........................................58
SECTION 2.01. CONVEYANCE OF MORTGAGE LOANS.............................................................58
SECTION 2.02. ACCEPTANCE BY TRUSTEE OF THE MORTGAGE LOANS..............................................62
SECTION 2.03. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SELLERS AND MASTER
SERVICER.................................................................................64
SECTION 2.04. REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR AS TO THE MORTGAGE LOANS.................66
SECTION 2.05. DELIVERY OF OPINION OF COUNSEL IN CONNECTION WITH SUBSTITUTIONS..........................67
SECTION 2.06. EXECUTION AND DELIVERY OF CERTIFICATES...................................................67
SECTION 2.07. REMIC MATTERS............................................................................68
SECTION 2.08. COVENANTS OF THE MASTER SERVICER.........................................................68
ARTICLE III ADMINISTRATION AND SERVICING OF MORTGAGE LOANS.......................................................69
SECTION 3.01. MASTER SERVICER TO SERVICE MORTGAGE LOANS................................................69
SECTION 3.02. SUBSERVICING; ENFORCEMENT OF THE OBLIGATIONS OF SUBSERVICERS.............................70
SECTION 3.03. RIGHTS OF THE DEPOSITOR AND THE TRUSTEE IN RESPECT OF THE MASTER SERVICER................70
SECTION 3.04. TRUSTEE TO ACT AS MASTER SERVICER........................................................71
SECTION 3.05. COLLECTION OF MORTGAGE LOAN PAYMENTS; CERTIFICATE ACCOUNT; DISTRIBUTION ACCOUNT;
CAPITALIZED INTEREST ACCOUNT; CARRYOVER SHORTFALL RESERVE FUND...........................71
SECTION 3.06. COLLECTION OF TAXES, ASSESSMENTS AND SIMILAR ITEMS; ESCROW ACCOUNTS......................74
SECTION 3.07. ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION REGARDING THE MORTGAGE
LOANS....................................................................................75
SECTION 3.08. PERMITTED WITHDRAWALS FROM THE CERTIFICATE ACCOUNT; THE DISTRIBUTION
ACCOUNT AND THE CARRYOVER SHORTFALL RESERVE FUND.........................................75
SECTION 3.09. MAINTENANCE OF HAZARD INSURANCE; MAINTENANCE OF PRIMARY INSURANCE
POLICIES.................................................................................78
SECTION 3.10. ENFORCEMENT OF DUE-ON-SALE CLAUSES; ASSUMPTION AGREEMENTS................................79
SECTION 3.11. REALIZATION UPON DEFAULTED MORTGAGE LOANS; REPURCHASE OF CERTAIN MORTGAGE
LOANS....................................................................................80
SECTION 3.12. TRUSTEE TO COOPERATE; RELEASE OF MORTGAGE FILES..........................................83
SECTION 3.13. DOCUMENTS, RECORDS AND FUNDS IN POSSESSION OF MASTER SERVICER TO BE HELD FOR
THE TRUSTEE..............................................................................84
SECTION 3.14. SERVICING COMPENSATION...................................................................85
SECTION 3.15. ACCESS TO CERTAIN DOCUMENTATION..........................................................85
SECTION 3.16. ANNUAL STATEMENT AS TO COMPLIANCE........................................................86
SECTION 3.17. ANNUAL INDEPENDENT PUBLIC ACCOUNTANTS' SERVICING STATEMENT; FINANCIAL
STATEMENTS...............................................................................86
SECTION 3.18. ERRORS AND OMISSIONS INSURANCE; FIDELITY BONDS...........................................86
SECTION 3.19. NOTIFICATION OF ADJUSTMENTS..............................................................87
SECTION 3.20. THE CORRIDOR CONTRACTS...................................................................87
ARTICLE IV DISTRIBUTIONS AND ADVANCES BY THE MASTER SERVICER.....................................................89
SECTION 4.01. ADVANCES.................................................................................89
SECTION 4.02. PRIORITIES OF DISTRIBUTION...............................................................90
SECTION 4.03. ALLOCATION OF NET DEFERRED INTEREST......................................................97
SECTION 4.04. ALLOCATION OF REALIZED LOSSES............................................................97
SECTION 4.05. CROSS-COLLATERALIZATION; ADJUSTMENTS TO AVAILABLE FUNDS..................................99
SECTION 4.06. MONTHLY STATEMENTS TO CERTIFICATEHOLDERS................................................100
SECTION 4.07. [RESERVED]..............................................................................102
SECTION 4.08. DETERMINATION OF PASS-THROUGH RATES FOR LIBOR CERTIFICATES..............................102
i
SECTION 4.09. DETERMINATION OF MTA....................................................................104
ARTICLE V THE CERTIFICATES......................................................................................105
SECTION 5.01. THE CERTIFICATES........................................................................105
SECTION 5.02. CERTIFICATE REGISTER; REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES.............105
SECTION 5.03. MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES.......................................110
SECTION 5.04. PERSONS DEEMED OWNERS...................................................................110
SECTION 5.05. ACCESS TO LIST OF CERTIFICATEHOLDERS' NAMES AND ADDRESSES...............................110
SECTION 5.06. MAINTENANCE OF OFFICE OR AGENCY.........................................................111
ARTICLE VI THE DEPOSITOR AND THE MASTER SERVICER................................................................112
SECTION 6.01. RESPECTIVE LIABILITIES OF THE DEPOSITOR AND THE MASTER SERVICER.........................112
SECTION 6.02. MERGER OR CONSOLIDATION OF THE DEPOSITOR OR THE MASTER SERVICER.........................112
SECTION 6.03. LIMITATION ON LIABILITY OF THE DEPOSITOR, THE SELLERS, THE MASTER SERVICER AND
OTHERS..................................................................................112
SECTION 6.04. LIMITATION ON RESIGNATION OF MASTER SERVICER............................................113
ARTICLE VII DEFAULT.............................................................................................114
SECTION 7.01. EVENTS OF DEFAULT.......................................................................114
SECTION 7.02. TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR................................................115
SECTION 7.03. NOTIFICATION TO CERTIFICATEHOLDERS......................................................117
ARTICLE VIII CONCERNING THE TRUSTEE.............................................................................118
SECTION 8.01. DUTIES OF TRUSTEE.......................................................................118
SECTION 8.02. CERTAIN MATTERS AFFECTING THE TRUSTEE...................................................119
SECTION 8.03. TRUSTEE NOT LIABLE FOR CERTIFICATES OR MORTGAGE LOANS...................................120
SECTION 8.04. TRUSTEE MAY OWN CERTIFICATES............................................................120
SECTION 8.05. TRUSTEE'S FEES AND EXPENSES.............................................................120
SECTION 8.06. ELIGIBILITY REQUIREMENTS FOR TRUSTEE....................................................121
SECTION 8.07. RESIGNATION AND REMOVAL OF TRUSTEE......................................................121
SECTION 8.08. SUCCESSOR TRUSTEE.......................................................................122
SECTION 8.09. MERGER OR CONSOLIDATION OF TRUSTEE......................................................122
SECTION 8.10. APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE...........................................123
SECTION 8.11. TAX MATTERS.............................................................................124
ARTICLE IX TERMINATION..........................................................................................126
SECTION 9.01. TERMINATION UPON LIQUIDATION OR PURCHASE OF ALL MORTGAGE LOANS..........................126
SECTION 9.02. FINAL DISTRIBUTION ON THE CERTIFICATES..................................................128
SECTION 9.03. ADDITIONAL TERMINATION REQUIREMENTS.....................................................129
ARTICLE X MISCELLANEOUS PROVISIONS..............................................................................130
SECTION 10.01. AMENDMENT...............................................................................130
SECTION 10.02. RECORDATION OF AGREEMENT; COUNTERPARTS..................................................131
SECTION 10.03. GOVERNING LAW...........................................................................132
SECTION 10.04. INTENTION OF PARTIES....................................................................132
SECTION 10.05. NOTICES.................................................................................132
SECTION 10.06. SEVERABILITY OF PROVISIONS..............................................................134
SECTION 10.07. ASSIGNMENT..............................................................................134
SECTION 10.08. LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS..............................................134
SECTION 10.09. INSPECTION AND AUDIT RIGHTS.............................................................135
SECTION 10.10. CERTIFICATES NONASSESSABLE AND FULLY PAID...............................................135
SECTION 10.11. [RESERVED]..............................................................................135
SECTION 10.12. PROTECTION OF ASSETS....................................................................135
ii
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 Sienna...................................S-II-C-1
Schedule II-D Representations and Warranties of Park Monaco...................................S-II-D-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
EXHIBITS
Exhibit A: Form of Senior Certificate (other than Notional Amount
Certificates)........................................................................A-1
Exhibit B: Form of Subordinated Certificate.....................................................B-1
Exhibit C: Form of Class A-R Certificate........................................................C-1
Exhibit D: Form of Notional Amount Certificate..................................................D-1
Exhibit E: Form of Reverse of Certificates......................................................E-1
Exhibit F: Form of Initial Certification of Trustee.............................................F-1
Exhibit G: Form of Delay Delivery Certification of Trustee......................................G-1
Exhibit H: Form of Final Certification of Trustee...............................................H-1
Exhibit I: Form of Transfer Affidavit...........................................................I-1
Exhibit J-1: Form of Transferor Certificate (Residual)............................................J-1
Exhibit J-2: Form of Transferor Certificate (Private).............................................J-2
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: Standard & Poor's LEVELS(R) Version 5.6b Glossary Revised, Appendix E................O-1
Exhibit P: [Reserved] ..........................................................................P-1
iii
THIS POOLING AND SERVICING AGREEMENT, dated as of May 1, 2005, among
CWALT, INC., a Delaware corporation, as depositor (the "Depositor"),
COUNTRYWIDE HOME LOANS, INC. ("Countrywide"), a New York corporation, as a
seller (a "Seller"), PARK GRANADA LLC ("Park Granada"), a Delaware limited
liability company, as a seller (a "Seller"), PARK MONACO INC. ("Park Monaco"),
a Delaware corporation, as a seller (a "Seller"), PARK SIENNA LLC ("Park
Sienna"), a Delaware limited liability company, as a seller (a "Seller"),
COUNTRYWIDE HOME LOANS SERVICING LP, a Texas limited partnership, as master
servicer (the "Master Servicer"), and THE BANK OF NEW YORK, a banking
corporation organized under the laws of the State of New York, as trustee (the
"Trustee").
WITNESSETH THAT
In consideration of the mutual agreements 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 Corridor Contract and Carryover
Shortfall Reserve Fund) will consist of four real estate mortgage investment
conduits (each a "REMIC" or, in the alternative, "Lower Tier REMIC A," "Lower
Tier REMIC B," the "Middle Tier REMIC" 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 REMIC created hereunder. The Master
REMIC will hold as assets the several classes of uncertificated Middle Tier
REMIC Interests (other than the Class MT-A-R Interest). The Middle Tier REMIC
will hold as assets the several classes of uncertificated Lower Tier REMIC
Interests (other than the Class LTA-A-R and Class LTB-A-R Interests). Lower
Tier REMIC A will hold as assets all property of the Loan Group 1 and Loan
Group 2. Lower Tier REMIC B will hold as assets all property of the Loan Group
3 and Loan Group 4. Each Middle Tier REMIC Interest (other than the Class
MT-A-R Interest) is hereby designated as a regular interest in the Middle Tier
REMIC. Each Lower Tier REMIC Interest (other than the Class LTA-A-R and Class
LTB-A-R Interests) is hereby designated as a regular interest in either Lower
Tier REMIC A or Lower Tier REMIC B as provided in the immediately following
two tables. The latest possible maturity date of all REMIC regular interests
created in this Agreement shall be the Latest Possible Maturity Date.
The following table set forth characteristics of the Interests in the
Lower Tier REMIC A (the "Lower Tier REMIC A Interests"):
----------------------------------------------------------------------------------------------------------------------
The Lower Tier REMIC A Initial Principal Interest Rate Corresponding Loan Aggregate Group
Interests Balance Group
----------------------------------------------------------------------------------------------------------------------
LT-I-A-1................ (1) (2) 1 I
LT-I-B-1................ (1) (2) 1 I
LT-I-C-1................ (1) (2) 1 I
LT-I-A-2................ (1) (2) 2 I
LT-I-B-2................ (1) (2) 2 I
LT-I-C-2................ (1) (2) 2 I
LTA-A-R................. (3) (3) N/A N/A
----------------------------------------------------------------------------------------------------------------------
---------------
(1) Each Class A Lower Tier REMIC Interest will have an Initial Principal
Balance equal to 0.9% of the Subordinated Portion of its
Corresponding Loan Group. Each Class B Lower Tier REMIC Interest will
have an Initial Principal Balance equal to 0.1% of the Subordinated
Portion of its Corresponding Loan Group. Each Class C Lower Tier
REMIC 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 Lower Tier
REMIC Interests corresponding to such Loan Group.
(2) This Lower Tier REMIC 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 LTA-A-R Interest is the sole class of residual interest in
the Lower Tier REMIC. It has no principal balance and pays no
principal or interest.
On each Distribution Date, the Available Funds for Aggregate Loan
Group I shall be distributed with respect to the corresponding Aggregate Group
I Interests in the following manner:
(1) Interest. Interest is to be distributed with respect to each
Aggregate Group I Interest at the rate, or according to the formulas,
described above;
(2) Principal, if no Cross-Over Situation Exists. If no Cross-Over
Situation exists with respect to any Class of Aggregate Group I Interests,
Principal Amounts arising with respect to each of Loan Group 1 through 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 Subordinated
Portion of such Loan Group and 0.1% of the Subordinated Portion of such Loan
Group; and second to the Loan Group's corresponding Class C Interest;
(3) Principal, if a Cross-Over Situation Exists. If a Cross-Over
Situation exists with respect to the Class A and Class B Aggregate Group I
Interests:
(a) If the Calculation Rate in respect of the outstanding Class A and
Class B Interests is less than the Net WAC Cap in respect of the
Group I Subordinated Certificates, 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 Net WAC Cap in respect of the
Group I Subordinated Certificates, 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 Net WAC Cap in respect of the Group I Subordinated
Certificates. With respect to each Corresponding Loan
2
Group, if (and to the extent that) the sum of (a) the principal payments
comprising the Principal Amount received during the Due Period and (b) the
Realized Losses, 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) The outstanding aggregate Class A and Class B Interests for all
Corresponding Loan Groups in Aggregate Loan Group I will not be
reduced below 1% of the excess of (i) the aggregate outstanding
Stated Principal Balances of the Mortgage Loans in Aggregate Loan
Group I as of the end of any Due Period over (ii) the aggregate Class
Certificate Balance of the Group I Senior Certificates as of the
related Distribution Date (after taking into account distributions of
principal on such Distribution Date).
If (and to the extent that) the limitation in paragraph (c) prevents
the distribution of principal to the 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 Groups
in Aggregate Loan Group I, the aggregate Class A and Class B Interests of
which are less than 1% of the Subordinated 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 the Lower Tier REMIC 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 the Lower Tier REMIC as a
reimbursement for prior Realized Losses.
The following table set forth characteristics of the Interests in the
Lower Tier REMIC B (the "Lower Tier REMIC B Interests", and, collectively with
the Lower Tier REMIC A Interests, the "Lower Tier REMIC Interests"):
----------------------------------------------------------------------------------------------------------------------
The Lower Tier REMIC B Initial Principal Interest Rate Corresponding Loan Aggregate Group
Interests Balance Group
----------------------------------------------------------------------------------------------------------------------
LT-I-A-3................ (1) (2) 3 II
LT-I-B-3................ (1) (2) 3 II
LT-I-C-3................ (1) (2) 3 II
LT-I-A-4................ (1) (2) 4 II
LT-I-B-4................ (1) (2) 4 II
LT-I-C-4................ (1) (2) 4 II
LT-A-R.................. (3) (3) N/A N/A
----------------------------------------------------------------------------------------------------------------------
---------------
(1) Each Class A Lower Tier REMIC Interest will have an Initial Principal
Balance equal to 0.9% of the Subordinated Portion of its
Corresponding Loan Group. Each Class B Lower Tier REMIC Interest will
have an Initial Principal Balance equal to 0.1% of the Subordinated
Portion of its Corresponding Loan Group. Each Class C Lower Tier
REMIC 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
3
Group over the initial aggregate principal balances of the Class A
and Class B Lower Tier REMIC Interests corresponding to such Loan
Group.
(2) This Lower Tier REMIC 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 LTB-AR Interest is the sole class of residual interest in
the Lower Tier REMIC. It has no principal balance and pays no
principal or interest.
On each Distribution Date, the Available Funds for Aggregate Loan
Group II shall be distributed with respect to the corresponding Aggregate
Group II Interests in the following manner:
(1) Interest. Interest is to be distributed with respect to each
Aggregate Group II Interest at the rate, or according to the formulas,
described above;
(2) Principal, if no Cross-Over Situation Exists. If no Cross-Over
Situation exists with respect to any Class of Aggregate Group II Interests,
Principal Amounts arising with respect to each of Loan Group 3 through Loan
Group 4 will be allocated: first to cause the Loan Group's corresponding Class
A and Class B Interests to equal, respectively, 0.9% of the Subordinated
Portion of such Loan Group and 0.1% of the Subordinated Portion of such Loan
Group; and second to the Loan Group's corresponding Class C Interest;
(3) Principal, if a Cross-Over Situation Exists. If a Cross-Over
Situation exists with respect to the Class A and Class B Aggregate Group II
Interests:
(a) If the Calculation Rate in respect of the outstanding Class A and
Class B Interests is less than the Net WAC Cap in respect of the
Group II Subordinated Certificates, 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 Net WAC Cap in respect of the
Group II Subordinated Certificates, 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 Net WAC Cap in respect of the Group II Subordinated
Certificates. With respect to each Corresponding Loan Group, if (and to the
extent that) the sum of (a) the principal payments comprising the Principal
Amount received during the Due Period and (b) the Realized Losses, 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) The outstanding aggregate Class A and Class B Interests for all
Corresponding Loan Groups in Aggregate Loan Group II will not be
reduced below 1% of the excess of (i) the aggregate outstanding
Stated Principal Balances of the Mortgage Loans in Aggregate Loan
Group II as of the end of any Due Period over (ii) the aggregate
Class Certificate
4
Balance of the Group II Senior Certificates as of the related
Distribution Date (after taking into account distributions of
principal on such Distribution Date).
If (and to the extent that) the limitation in paragraph (c) prevents
the distribution of principal to the 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 Groups
in Aggregate Loan Group II, the aggregate Class A and Class B Interests of
which are less than 1% of the Subordinated 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 the Lower Tier REMIC 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 the Lower Tier REMIC as a
reimbursement for prior Realized Losses.
The following table set forth characteristics of the
Interests in the Middle Tier REMIC (the "Middle Tier REMIC Interests"):
------------------------------------------------------------------------------------------------
The Middle Tier REMIC Initial Principal Interest Corresponding Related Loan
Interests Balance Rate Certificates Group
------------------------------------------------------------------------------------------------
MT-1-A-1 (1) (2) 1-A-1 1
MT-1-A-2 (1) (2) 1-A-2 1
MT-1-Accrual (1) (2) N/A 1
MT-2-A-1A (1) (2) 2-A-1A 2
MT-2-A-1B (1) (2) 2-A-1B 2
MT-2-A-1C (1) (2) 2-A-1C 2
MT-2-A-2 (1) (2) 2-A-2 2
MT-2-Accrual (1) (2) N/A 2
MT-3-A-1 $217,448,000 (2) 3-A-1 3
MT-3-A-2 $24,161,000 (2) 3-A-2 3
MT-4-A-1 $334,556,000 (2) 4-A-1 4
MT-4-A-2 $139,398,000 (2) 4-A-2 4
5
MT-4-A-3 $83,640,000 (2) 4-A-3 4
MT-$100 $100 (2) A-R 1
MT-I-M-1 $27,228,000 (3) I-M-1 1 through 2
MT-I-B-1 $7,242,000 (3) I-B-1 1 through 2
MT-I-B-2 $4,924,000 (3) I-B-2 1 through 2
MT-I-B-3 $4,635,000 (3) I-B-3 1 through 2
MT-I-B-4 $3,476,000 (3) I-B-4 1 through 2
MT-I-B-5 $2,896,818.12 (3) I-B-5 1 through 2
MT-II-M $38,954,000 (4) II-M 3 through 4
MT-II-B-1 $11,817,000 (4) II-B-1 3 through 4
MT-II-B-2 $7,003,000 (4) II-B-2 3 through 4
MT-II-B-3 $7,878,000 (4) II-B-3 3 through 4
MT-II-B-4 $6,128,000 (4) II-B-4 3 through 4
MT-II-B-5 $4,376,710.20 (4) II-B-5 3 through 4
MT-A-R (5) (5) A-R N/A
MT-1-A-1 (6) (7) N/A 1
MT-1-B-1 (6) (7) N/A 1
MT-1-C-1 (6) (7) N/A 1
MT-1-A-2 (6) (7) N/A 2
MT-1-B-2 (6) (7) N/A 2
MT-1-C-2 (6) (7) N/A 2
------------------------------------------------------------------------------------------------
-------------
(1) On each Distribution Date, Principal Amounts, Net Deferred Interest and
Realized Losses will be allocated to the Class MT-1-A-1, Class MT-1-A-2, Class
MT-1-Accrual, Class MT-2-A-1A, Class MT-2-A-1B, Class MT-2-A-1C, Class
MT-2-A-2 and Class MT-2-Accrual Interests in such a manner that, following
such allocations: (i) the principal balances of the Class MT-1-A-1, Class
MT-1-A-2 and Class MT-2-A Interests will equal 25% of the Class Certificate
Balance of their Corresponding Certificates for such Distribution Date, (ii)
the Class MT-1-Accrual Interest
6
will have a principal balance equal to 25% of the aggregate of the principal
balances of Class MT-1-A-1 and Class MT-1-A-2 Interests plus 50% of all Net
Deferred Interest in respect of the Mortgage Loans of Loan Group 1, and (iii)
the Class MT-2-Accrual Interest will have a principal balance equal to 25% the
principal balances of Class MT-2-A-1A, Class MT-2-A-1B, Class MT-2-A-1C and
Class MT-2-A-2 Interest plus 50% of all Net Deferred Interest in respect of
the Mortgage Loans of Loan Group 2.
(2) The Weighted Average Adjusted Net Mortgage Rate in respect of the Related
Loan Group.
(3) For each Interest Accrual Period, the interest rate for this Middle Tier
REMIC Interest will be the Subordinate Pass-Through Rate for Aggregate Loan
Group I.
(4) For each Interest Accrual Period, the interest rate for this Middle Tier
REMIC Interest will be the Subordinate Pass-Through Rate for Aggregate Loan
Group II.
(5) The MT-A-R is the sole Class of residual interest in the Middle Tier
REMIC. It pays no interest or principal.
(6) Each Class A and Class B Middle REMIC Interest will have an Initial
Principal Balance equal to 0.5% of the principal balance of the Mortgage Loans
in its Related Loan Group. Each Class C Middle REMIC Interest will have an
Initial Principal Balance equal to 49% of the initial aggregate Stated
Principal Balance of the Mortgage Loans in its Related Loan Group.
(7) This Middle REMIC Interest will have an Interest Rate equal to the
weighted average of the Adjusted Net Mortgage Rates of the Mortgage Loans in
the Related Loan Group.
On each Distribution Date, the available funds shall be distributed
with respect to the Middle Tier REMIC Interests in the following manner:
(1) Interest is to be distributed with respect to each Middle Tier
REMIC Interest at the rate, or according to the formulas, described above; and
(2) Principal, Realized Losses (and increases in Principal Balances
attributable to Subsequent Recoveries) in respect of the Class MT-1-A-1, Class
MT-1-A-2, Class MT-1-Accrual, Class MT-2-A-1A, Class MT-2-A-1B, Class
MT-2-A-1C, Class MT-2-A-2 and Class MT-2-Accrual Interests shall be allocated
as provided in Note (1) to the immediately preceding table. The Class
MT-3-A-1, Class MT-4-A-1, Class MT-4-A-2, Class MT-4-A-3, Class MT-I-M, Class
MT-I-B-1, Class MT-I-B-2, Class MT-I-B-3, Class MT-I-B-4, Class MT-I-B-5,
Class MT-II-M, Class MT-II-B-1, Class MT-II-B-2, Class MT-II-B-3, Class
MT-II-B-4 and Class MT-II-B-5 Interests shall be allocated with respect to
each Middle Tier REMIC Interest in an amount equal to 50% of the amount of
principal that is distributed with respect to each Middle Tier REMIC
Interest's Corresponding Class or Classes of Certificates.
For each Distribution Date: Scheduled and unscheduled principal and
Realized Losses from Loan Group 1 shall be allocated to: (a) the Class
MT-1-A-1 Interest, if the Class MT-1-A-1 Principal Balance (as calculated for
the Distribution Date) is exceeded by the principal balance of such Interest
for the prior Distribution Date, in such an amount as to cause the principal
7
balance of the Class MT-1-A-1 Interest to equal the Class MT-1-A-1 Principal
Balance (as calculated for the Distribution Date), or (b) the Class MT-1-B-1
Interest, if the the Class MT-1-B-1 Principal Balance (as calculated for the
Distribution Date) is exceeded by the principal balance of such Interest for
the prior Distribution Date, in such an amount as to cause the principal
balance of the Class MT-1-B-1 Interest to equal the Class MT-1-B-1 Principal
Balance (as calculated for the Distribution Date). 50% of any remaining
scheduled and unscheduled principal and Realized Losses from Loan Group 1
shall be allocated to the Class MT-1-C-1 Interest.
Scheduled and unscheduled principal and Realized Losses from Loan
Group 2 shall be allocated to: (a) the Class MT-1-A-2 Interest, if the Class
MT-1-A-2 Principal Balance (as calculated for the Distribution Date) is
exceeded by the principal balance of such Interest for the prior Distribution
Date, in such an amount as to cause the principal balance of the Class
MT-1-A-2 Interest to equal the Class MT-1-A-2 Principal Balance (as calculated
for the Distribution Date), or (b) the Class MT-1-B-2 Interest, if the the
Class MT-1-B-2 Principal Balance (as calculated for the Distribution Date) is
exceeded by the principal balance of such Interest for the prior Distribution
Date, in such an amount as to cause the principal balance of the Class
MT-1-B-2 Interest to equal the Class MT-1-B-2 Principal Balance. 50% of any
remaining scheduled and unscheduled principal and Realized Losses from Loan
Group 2 shall be allocated to the Class MT-1-C-2 Interest.
The following table sets forth characteristics of the Certificates,
together with minimum denominations and integral multiples in excess thereof
in which such Classes shall be issued (except that one Certificate of each
Class of Certificates may be issuable in a different amount and, in addition,
one Residual Certificate representing the Tax Matters Person Certificate may
be issued in a different amount for each class of REMIC Interest):
8
==============================================================================================
Integral
Initial Class Pass-Through Multiples
Class Certificate Rate Minimum in Excess of
Designation Balance (per annum) Denomination Minimum
----------------------------------------------------------------------------------------------
Class 1-A-1 $250,652,000 (1) $25,000.00 $1,000.00
Class 1-A-2 $50,273,000 (1) $25,000.00 $1,000.00
Class 1-A-X (6) (7) $25,000.00(12) $1,000.00(12)
Class A-R $100 (4) (5) (5)
Class 2-A-1A $110,000,000 (1) $25,000.00 $1,000.00
Class 2-A-1B $72,000,000 (1) $25,000.00 $1,000.00
Class 2-A-1C $7,820,000 (1) $25,000.00 $1,000.00
Class 2-A-2 $38,188,000 (1) $25,000.00 $1,000.00
Class 2-A-X (6) (8) $25,000.00(12) $1,000.00(12)
Class 3-A-1 $217,448,000 (2) $25,000.00 $1,000.00
Class 3-A-2 $24,161,000 (3) $25,000.00 $1,000.00
Class 4-A-1 $334,556,000 (3) $25,000.00 $1,000.00
Class 4-A-2 $139,398,000 (3) $25,000.00 $1,000.00
Class 4-A-3 $83,640,000 (3) $25,000.00 $1,000.00
Class II-A-X (6) (9) $25,000.00(12) $1,000.00(12)
Class I-M $27,228,000 (10) $25,000.00 $1,000.00
Class I-B-1 $7,242,000 (10) $25,000.00 $1,000.00
Class I-B-2 $4,924,000 (10) $25,000.00 $1,000.00
Class I-B-3 $4,635,000 (10) $100,000.00 $1,000.00
Class I-B-4 $3,476,000 (10) $100,000.00 $1,000.00
Class I-B-5 $2,896,818.12 (10) $100,000.00 $1,000.00
Class II-M $38,954,000 (11) $25,000.00 $1,000.00
Class II-B-1 $11,817,000 (11) $25,000.00 $1,000.00
Class II-B-2 $7,003,000 (11) $25,000.00 $1,000.00
Class II-B-3 $7,878,000 (11) $100,000.00 $1,000.00
Class II-B-4 $6,128,000 (11) $100,000.00 $1,000.00
Class II-B-5 $4,376,710.20 (11) $100,000.00 $1,000.00
----------------------------------------------------------------------------------------------
------------------------------------------
(1) For each Interest Accrual Period for any Distribution Date, the
Pass-Through Rates for the Class 1-A-1, Class 1-A-2, Class 2-A-1A,
Class 2-A-1B, Class 2-A-1C and Class 2-A-2 Certificates will be equal
to the lesser of (a) MTA plus the applicable Pass-Through Margin and
(b) the related Net WAC Cap. The Pass-Through Rates for the Class
1-A-1,
9
Class 1-A-2, Class 2-A-1A, Class 2-A-1B, Class 2-A-1C and Class 2-A-2
Certificates for the Interest Accrual Period for the first
Distribution Date will be 3.8140%, 3.9340%, 3.8140%, 3.8140%, 3.8140%
and 3.9340% per annum, respectively.
(2) For each Interest Accrual Period for any Distribution Date, the
Pass-Through Rate for the Class 3-A-1 Certificates will be equal to
the lesser of (a) LIBOR plus the applicable Pass-Through Margin and
(b) the related Net WAC Cap. The Pass-Through Rate for the Class
3-A-1 Certificates for the Interest Accrual Period for the first
Distribution Date will be 3.3400% per annum.
(3) For each Interest Accrual Period for any Distribution Date, the
Pass-Through Rates for the Class 3-A-2, Class 4-A-1, Class 4-A-2 and
Class 4-A-3 Certificates will be equal to the least of (a) 11.00%,
(b) LIBOR plus the applicable Pass-Through Margin and (c) the related
Net WAC Cap. The Pass-Through Rates for the Class 3-A-2, Class 4-A-1,
Class 4-A-2 and Class 4-A-3 Certificates for the Interest Accrual
Period for the first Distribution Date will be 3.4800%, 3.3100%,
3.3800% and 3.4500% per annum, respectively.
(4) For each Interest Accrual Period for any Distribution Date, the
Pass-Through Rate for the Class A-R Certificates will be the Weighted
Average Adjusted Net Mortgage Rate of the Mortgage Loans in Loan
Group 1. The Pass-Through Rate for the Class A-R Certificates for the
Interest Accrual Period for the first Distribution Date will be
0.8072% per annum.
(5) The Class A-R Certificate will be issued as two separate
certificates, one with an initial Certificate Balance of $99.99 and
the Tax Matters Person Certificate with an initial Certificate
Balance of $0.01.
(6) The Class 1-A-X, Class 2-A-X and Class II-A-X Certificates initially
will have no Class Certificate Balances and will bear interest on the
Component Notional Amounts of their respective Notional Amount
Components. Solely for federal income tax purposes: (i) the Class
1-A-X IO-2 Component will have a notional balance equal to the sum of
the principal balances in respect of the Class MT-1-A-1, Class
MT-1-Accrual, Class MT-1-A-1, Class MT-1-B-1-1 and Class MT-1-C-1-1
Interests, (ii) the Class 2-A-X IO-2 Component will have a notional
balance equal to the sum of the principal balances in respect of the
Class XX-0-X-0X, XX-0-X-0X, XX-0-X-0X, Class MT 2-A-2, Class
MT-2-Accrual, Class MT-2-A-2, Class MT-2-B-2-2 and Class MT-2-C-2
Interests.
(7) Interest will accrue with respect to the Class 1-A-X Certificates for
each Interest Accrual Period related to each Distribution Date in an
amount equal to the sum of the interest accrued on the Class 1-A-X
IO-1 and Class 1-A-X IO-2 Components at their respective Pass-Through
Rates for that Distribution Date.
(8) Interest will accrue with respect to the Class 2-A-X Certificates for
each Interest Accrual Period related to each Distribution Date in an
amount equal to the sum of the interest accrued on the Class 2-A-X
IO-1 and Class 2-A-X IO-2 Components at their respective Pass-Through
Rates for that Distribution Date.
(9) Interest will accrue with respect to the Class II-A-X Certificates
for each Interest Accrual Period related to each Distribution Date in
an amount equal to the sum of the interest accrued on the Class 3-A-X
IO-1, Class 3-A-X IO-2, Class 4-A-X IO-1, Class 4-A-X IO-2 Components
at their respective Pass-Through Rates for that Distribution Date.
(10) The Pass-Through Rate for each Class of Group I Subordinated
Certificates for each Interest Accrual Period for any Distribution
Date will be a per annum rate equal to the lesser of (a) MTA plus the
applicable Pass-Through Margin and (b) the related Net WAC Cap. The
Pass-Through Rates for the Class I-M, Class I-B-1, Class I-B-2, Class
I-B-3,
10
Class I-B-4 and Class I-B-5 Certificates for the Interest Accrual
Period for the first Distribution Date will be 3.6940%, 4.1940%,
4.5040%, 4.5040%, 4.5040% and 4.5040% per annum, respectively.
(11) The Pass-Through Rate for each Class of Group II Subordinated
Certificates for each Interest Accrual Period for any Distribution
Date will be a per annum rate equal to the lesser of (a) LIBOR plus
the applicable Pass-Through Margin and (b) the related Net WAC Cap.
The Pass-Through Rates for the Class II-M, Class II-B-1, Class
II-B-2, Class II-B-3, Class II-B-4 and Class II-B-5 Certificates for
the Interest Accrual Period for the first Distribution Date will be
3.5800%, 3.8300%, 4.3300%, 4.3300%, 4.3300% and 4.3300% per annum,
respectively.
(12) Based on Notional Amount.
The Trustee will treat the following items as being paid pursuant to
a limited recourse interest rate cap agreement as described in Section 8.11
herein: (i) any shortfall in respect of current interest to the Class 1-A-1 or
Class 1-A-2 Certificates as a result of Net Deferred Interest that is added to
the Component Principal Balance of the Class 1-A-X PO Component, (ii) any
shortfall in respect of current interest to the Class 2-A-1 Certificates as a
result of Net Deferred Interest that is added to the Component Principal
Balance of the Class 2-A-X PO Component, (iii) any excess of the Class Optimal
Interest Distribution Amount for the Class 1-A-X IO-1 and Class 1-A-X IO-2
Components over the amounts to which the Class 1-A-X Certificates would be
entitled based on the product of the notional balance and Pass-Through Rate of
the Class 1-A-X Certificates for federal income tax purposes provided in Note
(6) under the immediately preceding table, and (iv) any excess of the Class
Optimal Interest Distribution Amount for the Class 2-A-X IO-1 and Class 2-A-X
IO-2 Components over the amounts to which the Class 2-A-X Certificates would
be entitled based on the product of the notional balance and Pass-Through Rate
of the Class 2-A-X Certificates for federal income tax purposes provided in
Note (6) under the immediately preceding table. In the case of items (i) and
(ii) in the immediately preceding sentence, the payor in respect of the cap
agreement will be the Class 1-A-1 and Class 1-A-2 Certificates and the Class
2-A-1 Certificates, respectively. In the case of items (iii) and (iv) of the
second preceding sentence, the Class 2-A-X and Class 1-A-X Certificates,
respectively, will be the payor under the cap agreement.
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. It is not
intended that the Class A-R Certificates be entitled to any cash flow pursuant
to this Agreement except as provided in Section 4.02(a)(1)(iv)(A) hereunder.
For any purpose for which the Pass-Through Rates is calculated, the
interest rate on the Mortgage Loans shall be appropriately adjusted to account
for the difference between the monthly day count convention of the Mortgage
Loans and the monthly day count convention of the regular interests issued by
each of the REMICs. For purposes of calculating the Pass-Through Rates for
each of the interests issued by REMIC, such rates shall be adjusted to equal a
monthly day count convention based on a 30 day month for each Due Period and a
360-day year so that the Mortgage Loans and all regular interests will be
using the same monthly day count convention.
11
Set forth below are designations of Classes or Components of
Certificates 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.
Class X Certificates................ Class 1-A-X, Class 2-A-X and Class
II-A-X Certificates.
COFI Certificates................... None.
Combined Certificates............... None.
Component Certificates.............. Class 1-A-X, Class 2-A-X and Class
II-A-X Certificates. The Class
1-A-X Certificates are comprised
of the Class 1-A-X IO-1, Class
1-A-X IO-2 and Class 1-A-X PO
Components; the Class 2-A-X
Certificates are comprised of the
Class 2-A-X IO-1, Class 2-A-X IO-2
and Class 2-A-X PO Components; and
the Class II-A-X Certificates are
comprised of the Class 3-A-X IO-1,
Class 3-A-X IO-2, Class 3-A-X PO,
Class 4-A-X IO-1, Class 4-A-X IO-2
and Class 4-A-X PO Components.
For purposes of calculating
distributions of principal and/or
interest, the Component
Certificates, will be comprised of
multiple payment components having
the Designations, Initial
Component Principal Balances and
Component Notional Amounts, as
applicable, and Pass-Through Rates
set forth below:
Initial Closing Date
Component Component Pass-
Principal Notional Through
Designation Balance Amount Rate
------------------------------- ---------- ------------ ---------
Class 1-A-X IO-1 Component N/A $300,925,000 (1)
Class 1-A-X IO-2 Component N/A $28,675,215 (2)
Class 1-A-X PO Component $0 N/A 0%
12
Class 2-A-X IO-1 Component N/A $228,008,000 (3)
Class 2-A-X IO-2 Component N/A $21,726,702 (4)
Class 2-A-X PO Component $0 N/A 0%
Class 3-A-X IO-1 Component N/A $241,609,000 (5)
Class 3-A-X IO-2 Component N/A $23,023,523 (6)
Class 3-A-X PO Component $0 N/A 0%
Class 4-A-X IO-1 Component N/A $557,594,000 (7)
Class 4-A-X IO-2 Component N/A $53,133,187 (8)
Class 4-A-X PO Component $0 N/A 0%
------------------
(1) For the Interest Accrual
Period related to each
Distribution Date, a per annum
rate equal to, if greater than
zero, the Weighted Average
Adjusted Net Mortgage Rate of the
Mortgage Loans in Loan Group 1
minus the weighted average of the
Pass-Through Rates of the Class
1-A-1 and Class 1-A-2 Certificates
for that Distribution Date
(weighted on the basis of the
Class Certificate Balances of the
Class 1-A-1 and Class 1-A-2
Certificates and adjusted to a
rate calculated on the basis of a
360-day year comprised of twelve
30-day months).
(2) For the Interest Accrual
Period related to each
Distribution Date, a per annum
rate equal to, if greater than
zero, the excess of (i) the Net
WAC Cap for the Group I
Subordinated Certificates for that
Distribution Date over (ii) the
weighed average of the
Pass-Through Rates of the Group I
Subordinated Certificates for that
Distribution Date (weighted on the
basis of the respective Class
Certificate Balances of the Group
I Subordinated Certificates and
adjusted to a rate calculated on
the basis of a 360-day year
comprised of twelve 30-day
months).
(3) For the Interest Accrual
Period related to each
Distribution Date, a per annum
rate equal to, if greater than
zero, the Weighted Average
Adjusted Net Mortgage Rate of the
Mortgage Loans in Loan Group 2
minus the weighted average of the
Pass-Through Rates of the Class
2-A-1A, Class 2-A-1B, Class 2-A-1C
and Class 2-A-2 Certificates for
that Distribution Date (weighted
on the basis of the Class
Certificate Balances of the Class
2-A-1A, Class 2-A-1B, Class 2-A-1C
and Class 2-A-2 Certificates and
adjusted to a rate calculated on
the basis of a 360-day year
comprised of twelve 30-day
months).
(4) For the Interest Accrual
Period related to each
Distribution Date, a per annum
rate equal to, if greater than
zero, the excess of (i) the Net
WAC Cap for the Group I
Subordinated Certificates for that
Distribution Date over (ii) the
weighed average of the
Pass-Through Rates of the Group I
Subordinated Certificates for that
Distribution Date (weighted on the
basis of the respective Class
Certificate Balances of the Group
I Subordinated Certificates and
adjusted to a rate calculated on
the basis of a 360-day year
comprised of twelve 30-day
months).
13
(5) For the Interest Accrual
Period related to each
Distribution Date, a per annum
rate equal to, if greater than
zero, the Weighted Average
Adjusted Net Mortgage Rate of the
Mortgage Loans in Loan Group 3
minus the weighted average of the
Pass-Through Rates of the Class
3-A-1 and Class 3-A-2 Certificates
for that Distribution Date
(weighted on the basis of the
Class Certificate Balances of the
Class 3-A-1 and Class 3-A-2
Certificates and adjusted to a
rate calculated on the basis of a
360-day year comprised of twelve
30-day months).
(6) For the Interest Accrual
Period related to each
Distribution Date, a per annum
rate equal to, if greater than
zero, the excess of (i) the Net
WAC Cap for the Group II
Subordinated Certificates for that
Distribution Date over (ii) the
weighed average of the
Pass-Through Rates of the Group II
Subordinated Certificates for that
Distribution Date (weighted on the
basis of the respective Class
Certificate Balances of the Group
II Subordinated Certificates and
adjusted to a rate calculated on
the basis of a 360-day year
comprised of twelve 30-day
months).
(7) For the Interest Accrual
Period related to each
Distribution Date, a per annum
rate equal to, if greater than
zero, the Weighted Average
Adjusted Net Mortgage Rate of the
Mortgage Loans in Loan Group 4
minus the weighted average of the
Pass-Through Rates of the Class
4-A-1, Class 4-A-2 and Class 4-A-3
Certificates for that Distribution
Date (weighted on the basis of the
Class Certificate Balances of the
Class 4-A-1, Class 4-A-2 and Class
4-A-3 Certificates and adjusted to
a rate calculated on the basis of
a 360-day year comprised of twelve
30-day months).
(8) For the Interest Accrual
Period related to each
Distribution Date, a per annum
rate equal to, if greater than
zero, the excess of (i) the Net
WAC Cap for the Group II
Subordinated Certificates for that
Distribution Date over (ii) the
weighed average of the
Pass-Through Rates of the Group II
Subordinated Certificates for that
Distribution Date (weighted on the
basis of the respective Class
Certificate Balances of the Group
II Subordinated Certificates and
adjusted to a rate calculated on
the basis of a 360-day year
comprised of twelve 30-day
months).
Components................................ Class 1-A-X IO-1, Class 1-A-X
IO-2, Class 1-A-X PO, Class 2-A-X
IO-1, Class 2-A-X IO-2, Class
2-A-X PO, Class 3-A-X IO-1, Class
3-A-X IO-2, Class 3-A-X PO, Class
4-A-X IO-1, Class 4-A-X IO-2 and
Class 4-A-X PO Components. The
Components are not separately
transferable from the related
Class of Certificates.
Delay Certificates........................ All interest-bearing Classes of
Certificates other than the
Non-Delay Certificates, if any.
ERISA-Restricted
Certificates........................ The Residual Certificates, the
Private Certificates and any
Certificate that does not or no
longer satisfies the applicable
rating requirement under the
Underwriter's Exemption.
14
Group 1 Senior Certificates......... Class 1-A-1, Class 1-A-2, Class
1-A-X and Class A-R Certificates.
Group 1 Certificates................ Group 1 Senior Certificates and
the Subordinated Portion related
to Loan Group 1.
Group 2 Senior Certificates......... Class 2-A-1A, Class 2-A-1B, Class
2-A-1C, Class 2-A-2 and Class
2-A-X Certificates.
Group 2 Certificates................ Group 2 Senior Certificates and
the Subordinated Portion related
to Loan Group 2.
Group 3 Senior Certificates......... Class 3-A-1 and Class 3-A-2
Certificates.
Group 3 Certificates................ Group 3 Senior Certificates and
the Subordinated Portion related
to Loan Group 3.
Group 4 Senior Certificates......... Class 4-A-1, Class 4-A-2 and Class
4-A-3 Certificates.
Group 4 Certificates................ Group 4 Senior Certificates and
the Subordinated Portion related
to Loan Group 4.
Group I Senior Certificates......... Group 1 Senior Certificates and
Group 2 Senior Certificates.
Group I Subordinated Certificates... Class I-M, Class I-B-1, Class
I-B-2, Class I-B-3, Class I-B-4
and Class I-B-5 Certificates.
Group I Certificates................ Group I Senior Certificates and
Group I Subordinated Certificates.
Group II
Senior Certificates................. Group 3 Senior Certificates and
Group 4 Senior Certificates.
Group II
Subordinated Certificates........... Class II-M, Class II-B-1, Class
II-B-2, Class II-B-3, Class II-B-4
and Class II-B-5 Certificates.
Group II Certificates............... Group II Senior Certificates and
Group II Subordinated
Certificates.
LIBOR Certificates.................. Class 3-A-1, Class 3-A-2, Class
4-A-1, Class 4-A-2, Class 4-A-3
and the Group II Subordinated
Certificates.
15
MTA Certificates.................... Class 1-A-1, Class 1-A-2, Class
2-A-1A, Class 2-A-1B, Class
2-A-1C, Class 2-A-2 and the Group
I Subordinated Certificates.
Non-Delay Certificates.............. None.
Notional Amount
Certificates........................ None.
Notional Amount
Components.......................... Class 1-A-X IO-1, Class 1-A-X
IO-2, Class 2-A-X IO-1, Class
2-A-X IO-2, Class 3-A-X IO-1,
Class 3-A-X IO-2, Class 4-A-X IO-1
and Class 4-A-X IO-2 Components.
Offered Certificates................ All Classes of Certificates other
than the Private Certificates.
Physical Certificates............... Private Certificates and the
Residual Certificates.
Planned Principal Classes........... None.
Planned Principal
Components.......................... None.
Principal Only Components........... Class 1-A-X PO, Class 2-A-X PO,
Class 3-A-X PO and Class 4-A-X PO
Components.
Private Certificates................ Class I-B-3, Class I-B-4, Class
I-B-5, Class II-B-3, Class II-B-4
and Class II-B-5 Certificates.
Rating Agencies..................... S&P and Xxxxx'x.
Regular Certificates................ All Classes of Certificates, other
than the Residual Certificates.
Residual Certificates............... Class A-R Certificates.
Senior Certificate Group............ Group 1 Senior Certificates, Group
2 Senior Certificates, Group 3
Senior Certificates and Group 4
Senior Certificates, as
applicable.
Senior Certificates................. Class 1-A-1, Class 1-A-2, Class
1-A-X, Class 2-A-1A, Class 2-A-1B,
Class 2-A-1C, Class 2-A-2, Class
2-A-X, Class 3-A-1, Class 3-A-2,
Class 4-A-1, Class 4-A-2, Class
4-A-3, Class II-A-X and Class A-R
Certificates.
Subordinated Certificates .......... Class I-M, Class I-B-1, Class
I-B-2, Class I-B-3, Class I-B-4,
Class I-B-5, Class II-M, Class
II-B-1, Class II-B-2, Class
II-B-3, Class II-B-4 and Class
II-B-5 Certificates.
16
Targeted Principal Classes.......... None.
Underwriter......................... Countrywide Securities Corporation.
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.
17
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and phrases, unless the
context otherwise requires, shall have the following meanings:
Accretion Directed Certificates: As specified in the Preliminary
Statement.
Accretion Direction Rule: Not applicable.
Accrual Amount: Not applicable.
Accrual Certificates: As specified in the Preliminary Statement.
Accrual Components: As specified in the Preliminary Statement.
Accrual Termination Date: Not applicable.
Adjusted Cap Rate: With respect to the Class 1-A-1 and Class 1-A-2
Certificates for any Distribution Date, the excess, if any, of the related Net
WAC Cap for such Distribution Date, over a fraction expressed as a percentage,
the numerator of which is equal to the product of (i) 12 and (ii) the amount
of Net Deferred Interest for the Mortgage Loans in Loan Group 1 for that
Distribution Date, and the denominator of which is the aggregate Stated
Principal Balance of the Mortgage Loans in Loan Group 1 at the end of the
Prepayment Period related to the immediately preceding Distribution Date.
With respect to the Class 2-A-1A, Class 2-A-1B, Class 2-A-1C and
Class 2-A-2 Certificates for any Distribution Date, the excess, if any, of the
related Net WAC Cap for such Distribution Date, over a fraction expressed as a
percentage, the numerator of which is equal to the product of (i) 12 and (ii)
the amount of Net Deferred Interest for the Mortgage Loans in Loan Group 2 for
that Distribution Date, and the denominator of which is the aggregate Stated
Principal Balance of the Mortgage Loans in Loan Group 2 at the end of the
Prepayment Period related to the immediately preceding Distribution Date.
With respect to the Class 3-A-1 and Class 3-A-2 Certificates for any
Distribution Date, the excess, if any, of the related Net WAC Cap for such
Distribution Date, over a fraction expressed as a percentage, the numerator of
which is equal to the product of (i) a fraction, the numerator of which is 360
and the denominator of which is the actual number of
days in the related Interest Accrual Period, and (ii) the amount of Net
Deferred Interest for the Mortgage Loans in Loan Group 3 for that Distribution
Date, and the denominator of which is the aggregate Stated Principal Balance
of the Mortgage Loans in Loan Group 3 at the end of the Prepayment Period
related to the immediately preceding Distribution Date.
With respect to the Class 4-A-1, Class 4-A-2 and Class 4-A-3
Certificates for any Distribution Date, the excess, if any, of the related Net
WAC Cap for such Distribution Date, over a fraction expressed as a percentage,
the numerator of which is equal to the product of (i) a fraction, the
numerator of which is 360 and the denominator of which is the actual number of
18
days in the related Interest Accrual Period, and (ii) the amount of Net
Deferred Interest for the Mortgage Loans in Loan Group 4 for that Distribution
Date, and the denominator of which is the aggregate Stated Principal Balance
of the Mortgage Loans in Loan Group 4 at the end of the Prepayment Period
related to the immediately preceding Distribution Date.
With respect to the Group I Subordinated Certificates for any
Distribution Date, the excess, if any, of the related Net WAC Cap for such
Distribution Date, over a fraction expressed as a percentage, the numerator of
which is equal to the product of (i) 12 and (ii) the amount of Net Deferred
Interest for the Mortgage Loans in Aggregate Loan Group I for that
Distribution Date, and the denominator of which is the aggregate Stated
Principal Balance of the Mortgage Loans in Aggregate Loan Group I at the end
of the Prepayment Period related to the immediately preceding Distribution
Date.
With respect to the Group II Subordinated Certificates for any
Distribution Date, the excess, if any, of the related Net WAC Cap for such
Distribution Date, over a fraction expressed as a percentage, the numerator of
which is equal to the product of (i) a fraction, the numerator of which is 360
and the denominator of which is the actual number of days in the related
Interest Accrual Period, and (ii) the amount of Net Deferred Interest for the
Mortgage Loans in Aggregate Loan Group II for that Distribution Date, and the
denominator of which is the aggregate Stated Principal Balance of the Mortgage
Loans in Aggregate Loan Group II at the end of the Prepayment Period related
to the immediately preceding Distribution Date.
With respect to the Class 1-A-X IO-1 Component for any Distribution
Date, the Pass-Through Rate for the Class 1-A-X IO-1 Component computed for
this purpose by (A) reducing the Weighted Average Adjusted Net Mortgage Rates
of the Group 1 Mortgage Loans by a per annum rate equal to (i) the product of
(a) the Net Deferred Interest for the Group 1 Mortgage Loans for such
Distribution Date, and (b) 12, divided by (ii) the aggregate Stated Principal
Balance of the Group 1 Mortgage Loans as of the first day of the month prior
to such Distribution Date and (B) computing the Pass-Through Rates of the
Class 1-A-1 and Class 1-A-2 Certificates by substituting "Adjusted Cap Rate"
for "Net WAC Cap" in the calculation thereof.
With respect to the Class 2-A-X IO-1 Component for any Distribution
Date, the Pass-Through Rate for the Class 2-A-X IO-1 Component computed for
this purpose by (A) reducing the Weighted Average Adjusted Net Mortgage Rates
of the Group 2 Mortgage Loans by a per annum rate equal to (i) the product of
(a) the Net Deferred Interest for the Group 2 Mortgage Loans for such
Distribution Date, and (b) 12, divided by (ii) the aggregate Stated Principal
Balance of the Group 2 Mortgage Loans as of the first day of the month prior
to such Distribution Date and (B) computing the Pass-Through Rates of the
Class 2-A-1A, Class 2-A-1B, Class 2-A-1C and Class 2-A-2 Certificates by
substituting "Adjusted Cap Rate" for "Net WAC Cap" in the calculation thereof.
With respect to the Class 3-A-X IO-1 Component for any Distribution
Date, the Pass-Through Rate for the Class 3-A-X IO-1 Component computed for
this purpose by (A) reducing the Weighted Average Adjusted Net Mortgage Rates
of the Group 3 Mortgage Loans by a per annum rate equal to (i) the product of
(a) the Net Deferred Interest for the Group 3 Mortgage Loans for such
Distribution Date, and (b) 12, divided by (ii) the aggregate Stated Principal
Balance of the Group 3 Mortgage Loans as of the first day of the month prior
to such
19
Distribution Date and (B) computing the Pass-Through Rates of the Class 3-A-1
and Class 3-A-2 Certificates by substituting "Adjusted Cap Rate" for "Net WAC
Cap" in the calculation thereof.
With respect to the Class 4-A-X IO-1 Component for any Distribution
Date, the Pass-Through Rate for the Class 4-A-X IO-1 Component computed for
this purpose by (A) reducing the Weighted Average Adjusted Net Mortgage Rates
of the Group 4 Mortgage Loans by a per annum rate equal to (i) the product of
(a) the Net Deferred Interest for the Group 4 Mortgage Loans for such
Distribution Date, and (b) 12, divided by (ii) the aggregate Stated Principal
Balance of the Group 4 Mortgage Loans as of the first day of the month prior
to such Distribution Date and (B) computing the Pass-Through Rates of the
Class 4-A-1, Class 4-A-2 and Class 4-A-3 Certificates by substituting
"Adjusted Cap Rate" for "Net WAC Cap" in the calculation thereof.
With respect to the Class 1-A-X IO-2 and Class 2-A-X IO-2 Components
for any Distribution Date, the Pass-Through Rate for such component computed
for this purpose by (A) reducing the Weighted Average Adjusted Net Mortgage
Rates of the Mortgage Loans in Aggregate Loan Group I by a per annum rate
equal to: (i) the product of (a) the Net Deferred Interest for the Mortgage
Loans in Aggregate Loan Group I for such Distribution Date, and (b) 12,
divided by (ii) the aggregate Stated Principal Balance of the Mortgage Loans
in Aggregate Loan Group I as of the first day of the month prior to such
Distribution Date and (B) computing the Pass-Through Rates of the Group I
Subordinated Certificates by substituting "Adjusted Cap Rate" for "Net WAC
Cap" in the calculation thereof.
With respect to the Class 3-A-X IO-2 and Class 4-A-X IO-2 Components
for any Distribution Date, the Pass-Through Rate for such component computed
for this purpose by (A) reducing the Weighted Average Adjusted Net Mortgage
Rates of the Mortgage Loans in Aggregate Loan Group II by a per annum rate
equal to: (i) the product of (a) the Net Deferred Interest for the Mortgage
Loans in Aggregate Loan Group II for such Distribution Date, and (b) 12,
divided by (ii) the aggregate Stated Principal Balance of the Mortgage Loans
in Aggregate Loan Group II as of the first day of the month prior to such
Distribution Date and (B) computing the Pass-Through Rates of the Group II
Subordinated Certificates by substituting "Adjusted Cap Rate" for "Net WAC
Cap" in the calculation thereof.
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 (as of the first day of
the related Due Period) less the 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 a 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 in the related Due Period and not
received by the Master Servicer as of the close of business on the related
Determination Date,
20
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
on such REO Property), less the aggregate amount of any such delinquent
payments that the Master Servicer has determined would constitute a
Nonrecoverable Advance, if advanced.
Aggregate Loan Group: Aggregate Loan Group I or Aggregate Loan Group
II, as the context requires.
Aggregate Loan Group I: Collectively, Loan Group 1 and Loan Group 2.
Aggregate Loan Group II: Collectively, Loan Group 3 and Loan Group 4.
Aggregate Subordinated Percentage: As to any Distribution Date and
either Aggregate Loan Group, the fraction, expressed as a percentage, the
numerator of which is equal to the aggregate Class Certificate Balance of the
related Subordinated Certificates immediately prior to such Distribution Date
and the denominator of which is the aggregate Stated Principal Balance of all
the Mortgage Loans in such Aggregate Loan Group as of the first day of the
related Due Period.
Agreement: This Pooling and Servicing Agreement and all amendments or
supplements to this Pooling and Servicing Agreement.
Allocable Share: As to any Distribution Date, any Loan Group and any
Class of Certificates or any interest-bearing Component thereof, the ratio
that the amount calculated with respect to such Distribution Date (A) with
respect to either of the Group I Senior Certificates or Group II Senior
Certificates, pursuant to clause (i) of the definition of Class Optimal
Interest Distribution Amount (without giving effect to any reduction of such
amount pursuant to Section 4.02(d)) and (B) with respect to the Group I
Subordinated Certificates or Group II Subordinated Certificates, pursuant to
the definition of Assumed Interest Amount for such Class or after the (x)
first related Senior Termination Date, with respect to the Group I Senior
Certificates, and (y) first related Senior Termination Date, with respect to
the Group II Senior Certificates, pursuant to clause (i) of the definition of
Class Optimal Interest Distribution Amount (without giving effect to any
reduction of such amount pursuant to Section 4.02(d)) bears to the aggregate
amount calculated with respect to such Distribution Date for each such related
Class of Certificates pursuant to clause (i) of the definition of Class
Optimal Interest Distribution Amount (without giving effect to any reduction
of such amounts pursuant to Section 4.02(d)) or the definition of Assumed
Interest Amount for such Loan Group and Class, as applicable.
Amount Held for Future Distribution: As to any Distribution Date and
Mortgage Loans in a 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 Mortgage Loans in that Loan Group and (ii) all
Scheduled Payments due in the related Due Period relating to Mortgage Loans in
that Loan Group.
Applicable Credit Support Percentage: As defined in Section 4.02(e).
21
Appraised Value: 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. 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. 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.
Assumed Interest Amount: With respect to any Distribution Date, any
Class of Subordinated Certificates and the related Loan Group, one month's
interest accrued during the related Interest Accrual Period at the
Pass-Through Rate for such Class on the related Subordinated Portion
immediately prior to that Distribution Date.
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 in respect of the related
Mortgage Loans pursuant to Section 3.05(b) net of the related Amount Held for
Future Distribution and net of amounts permitted to be withdrawn from the
Certificate Account pursuant to clauses (i) - (viii), inclusive, of Section
3.08(a) in respect of the Mortgage Loans in that Loan Group and amounts
permitted to be withdrawn from the Distribution Account pursuant to clauses
(i) - (iii), inclusive, of Section 3.08(b) in respect of the Mortgage Loans in
that Loan Group, (b) the amount of the related Advance, (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, (d) the Transfer Payment Received
plus interest thereon as provided in Section 4.05 for such Loan Group less the
Transfer Payment Made plus interest thereon as provided in Section 4.05 for
such Loan Group and (e) any amount on deposit in related subaccount of the
Capitalized Interest Account; provided, however, that (x) with respect to any
Loan Group in Aggregate Loan Group I, on the first related Senior Termination
Date, Available Funds with respect to the Loan Group relating to the remaining
Senior Certificate Group shall include the Available Funds from the other Loan
Groups in Aggregate Loan Group I after all distributions are made on the Group
I Senior Certificates of the other Senior Certificate Groups, and on any
Distribution Date thereafter, Available Funds shall be calculated based on all
the Mortgage Loans in Aggregate Loan Group I, as opposed to the Mortgage Loans
in the related Loan Group and (y) with respect to any Loan Group in Aggregate
Loan Group II, on the first related Senior Termination Date, Available Funds
with respect to the Loan Group relating to the remaining Senior Certificate
Group shall include the Available Funds from the other Loan Groups in
Aggregate Loan Group II after all distributions are made on the Group II
Senior Certificates of the other Senior Certificate Group, and on any
Distribution Date thereafter, Available Funds
22
shall be calculated based on all the Mortgage Loans in Aggregate Loan Group
II, as opposed to the Mortgage Loans in the related Loan Group.
Bankruptcy Code: Title 11 of the United States Code, as amended.
Benefit Plan Opinion: As defined in Section 5.02(b).
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, in the case of the
Class A and Class B Lower Tier REMIC I Interests and the Class A and Class B
Lower Tier REMIC II Interests, the product of (i) 10 and (ii) the weighted
average rate of the outstanding Class A and Class B Interests, treating each
Class A Interest as capped at zero or reduced by a fixed percentage of 100% of
the interest accruing on such Class.
Capitalized Interest Account: The separate Eligible Account
designated as such and created and maintained by the Trustee pursuant to
Section 3.05(h) hereof. The Capitalized Interest Account shall be treated as
an "outside reserve fund" under applicable Treasury regulations and shall not
be part of any REMIC. Except as provided in Section 3.05(h) hereof, any
investment earnings on the amounts on deposit in the Capitalized Interest
Account shall be treated as owned by the Depositor and will be taxable to the
Depositor. On the Closing Date, the aggregate amount deposited in the
Capitalized Interest Account shall be $2,861,759.77.
Carryover Shortfall Amount: For any Class of LIBOR Certificates and
any Distribution Date, the sum of (a) the excess, if any, of (i) the amount of
interest such Class of Certificates would have been entitled to receive on
such Distribution Date pursuant to clause (i) of the definition of Class
Optimal Interest Distribution Amount (prior to any reductions pursuant to
Section 4.02(d) and any reduction due to the allocation of Net Deferred
Interest) had the applicable Pass-Through Rate not been limited to the related
Net WAC Cap up to but not exceeding a per annum rate of 11.00% (other than in
the case of the Class 3-A-1 Certificates), over (ii) the amount of interest
such Class of Certificates is entitled to receive on such Distribution Date
pursuant to clause (i) of the definition of Class Optimal Interest
Distribution Amount (prior to any reductions pursuant to Section 4.02(d) and
any reduction due to the allocation of Net Deferred Interest) and (b) with
respect to each Class of LIBOR Certificates (other than the Class II-B-3,
Class II-B-4 and Class II-B-5 Certificates), the unpaid portion of any such
excess from prior Distribution Dates (and interest accrued thereon at the then
applicable Pass-Through Rate on such Class of Certificates, without giving
effect to the related Net WAC Cap (up to a rate of 11.00% per annum other than
in the case of the Class 3-A-1 Certificates)).
Carryover Shortfall Reserve Fund: The separate fund 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 LIBOR Certificates and the
Class II-A-X Certificates and designated "The Bank of New York in trust for
registered holders of CWALT, Inc., Alternative Loan Trust 2005-24, Mortgage
23
Pass-Through Certificates, Series 2005-24." Funds in the Carryover Shortfall
Reserve Fund shall be held in trust for the Holders of the LIBOR Certificates
and the Class II-A-X 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 2005-24, Mortgage Pass-Through Certificates Series 2005-24."
Certificate Balance: With respect to any Certificate (other than the
Notional Amount 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 any
increase in the Certificate Balance of such Certificate pursuant to Section
4.02 due to the receipt of Subsequent Recoveries (B) minus the sum of (i) all
distributions of principal previously made with respect to that Certificate
and (ii) all Realized Losses allocated to that Certificate and, in the case of
any Subordinated Certificates, all other reductions in Certificate Balance
previously allocated to that Certificate pursuant to Section 4.04 without
duplication, and (C) increased by the amount of Net Deferred Interest incurred
by the Mortgage Loans and allocated to the applicable Class or Component
pursuant to Section 4.04. With respect to the Class X Certificates at any
date, the maximum dollar amount of principal to which the Holder thereof is
entitled under this Agreement, such amount being equal to the Component
Principal Balances of the related Principal Only Component or Principal Only
Components, as applicable, as of such date.
Certificate Group: The Group 1 Certificates, Group 2 Certificates,
Group 3 Certificates and Group 4 Certificates, as the context requires.
Certificate Owner: With respect to a Book-Entry Certificate, the
Person who is the beneficial owner of such Book-Entry Certificate. For the
purposes of this Agreement, in order for a Certificate Owner to enforce any of
its rights 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.
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
24
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.
Class: All Certificates bearing the same class designation as set
forth in the Preliminary Statement.
Class 1-A-1 Principal Balance: The quotient of: (a) product of: (i)
the Group 1-X Subordinate Allocation Rate and (ii) the principal balance of
the Class 1-B-1 Interests for the immediately preceding Distribution Date and
(b) two times the Weighted Average Adjusted Net Mortgage Rate for Loan Group 1
less the Group 1-X Subordinate Allocation Rate.
Class 1-A-2 Principal Balance: The quotient of: (a) product of: (i)
the Group 2-X Subordinate Allocation Rate and (ii) the principal balance of
the Class 1-B-2 Interests for the immediately preceding Distribution Date and
(b) two times the Weighted Average Adjusted Net Mortgage Rate for Loan Group 2
less the Group 2-X Subordinate Allocation Rate.
Class 1-B-1 Principal Balance: The quotient of: (a) product of: (i)
two times the Weighted Average Adjusted Net Mortgage Rate for Loan Group 1
less the Group 1-X Subordinate Allocation Rate and (ii) the principal balance
of the Class 1-A-1 Interests for the immediately preceding Distribution Date
and (b) the Group 1-X Subordinate Allocation Rate.
Class 1-B-2 Principal Balance: The quotient of: (a) product of: (i)
two times the Weighted Average Adjusted Net Mortgage Rate for Loan Group 2
less the Group 2-X Subordinate Allocation Rate and (ii) the principal balance
of the Class 1-A-2 Interests for the immediately preceding Distribution Date
and (b) the Group 2-X Subordinate Allocation Rate.
Class Certificate Balance: With respect to any Class and as to any
date of determination, the aggregate of the Certificate Balances of all
Certificates of such Class as of such date.
Class Interest Shortfall: As to any Distribution Date and Class, the
amount by which the amount described in clause (i) of the definition of Class
Optimal Interest Distribution Amount for such Class exceeds the amount of
interest actually distributed on such Class on such Distribution Date pursuant
to such clause (i).
Class LTI-A-R Interest: The sole class of "residual interest" in the
Lower Tier REMIC I.
Class LTII-A-R Interest: The sole class of "residual interest" in the
Lower Tier REMIC II.
Class MT-A-R Interest: The sole class of "residual interest" in the
Middle Tier REMIC.
Class Optimal Interest Distribution Amount: With respect to any
Distribution Date and interest-bearing Class or Component, the sum of (i) one
month's interest accrued during the related Interest Accrual Period at the
Pass-Through Rate for such Class or Component on the related Class Certificate
Balance, Component Principal Balance, Notional Amount or Component Notional
Amount, as applicable, immediately prior to such Distribution Date, subject to
reduction as provided in Section 4.02(d) reduced by, any Net Deferred Interest
on the
25
Mortgage Loans for the related Distribution Date allocated to their respective
Class Certificate Balances or Component Principal Balances, as applicable, as
described in Section 4.03 and (ii) any Class Unpaid Interest Amounts for such
Class or Component.
Class Subordination Percentage: With respect to any Distribution Date
and each Class of Group I Subordinated Certificates, the quotient (expressed
as a percentage) of (a) the Class Certificate Balance of such Class of Group I
Subordinated Certificates immediately prior to such Distribution Date, divided
by (b) the aggregate of the Class Certificate Balances of all Classes of Group
I Certificates (other than the related Notional Amount Certificates)
immediately prior to such Distribution Date. With respect to any Distribution
Date and each Class of Group II Subordinated Certificates, the quotient
(expressed as a percentage) of (a) the Class Certificate Balance of such Class
of Group II Subordinated Certificates immediately prior to such Distribution
Date, divided by (b) the aggregate of the Class Certificate Balances of all
Classes of Group II Certificates (other than the related Notional Amount
Certificates) immediately prior to such Distribution Date.
Class Unpaid Interest Amounts: As to any Distribution Date and Class
of interest-bearing Certificates or any interest-bearing Component, the amount
by which the aggregate Class Interest Shortfalls for such Class or Component
on prior Distribution Dates exceeds the amount distributed on such Class or
Component on prior Distribution Dates pursuant to clause (ii) of the
definition of Class Optimal Interest Distribution Amount.
Closing Date: May 27, 2005.
Code: The Internal Revenue Code of 1986, including any successor or
amendatory provisions.
COFI: The Monthly Weighted Average Cost of Funds Index for the
Eleventh District Savings Institutions published by the Federal Home Loan Bank
of San Francisco.
COFI Certificates: As specified in the Preliminary Statement.
Compensating Interest: As to any Distribution Date and Loan Group, an
amount equal to one-half of the Master Servicing Fee for that Loan Group for
the related Due Period.
Component: As specified in the Preliminary Statement.
Component Certificates: As specified in the Preliminary Statement.
Component Notional Amount: With respect to any date and the Class
1-A-X IO-1 Component, the sum of (x) the aggregate Class Certificate Balance
of the Class 1-A-1 and Class 1-A-2 Certificates as of such date and (y) the
Component Principal Balance of the Class 1-A-X PO Component as of such date.
With respect to an Interest Accrual Period related to a Distribution
Date and the Class 1-A-X IO-2 Component, the Subordinated Portion for the
Group I Subordinated Certificates related to Loan Group 1 for that
Distribution Date.
26
With respect to any date and the Class 2-A-X IO-1 Component, the sum
of (x) the aggregate Class Certificate Balance of the Class 2-A-1A, Class
2-A-1B, Class 2-A-1C and Class 2-A-2 Certificates and (y) the Component
Principal Balance of the Class 2-A-X PO Component immediately prior to such
Distribution Date.
With respect to an Interest Accrual Period related to a Distribution
Date and the Class 2-A-X IO-2 Component, the Subordinated Portion for the
Group I Subordinated Certificates related to Loan Group 2 for that
Distribution Date.
With respect to any date and the Class 3-A-X IO-1 Component, the sum
of (x) the aggregate Class Certificate Balance of the Class 3-A-1 and Class
3-A-2 Certificates and (y) the Component Principal Balance of the Class 3-A-X
PO Component immediately prior to such Distribution Date.
With respect to an Interest Accrual Period related to a Distribution
Date and the Class 3-A-X IO-2 Component, the Subordinated Portion for the
Group II Subordinated Certificates related to Loan Group 3 for that
Distribution Date.
With respect to any date and the Class 4-A-X IO-1 Component, the sum
of (x) the aggregate Class Certificate Balance of the Class 4-A-1, Class 4-A-2
and Class 4-A-3 Certificates and (y) the Component Principal Balance of the
Class 4-A-X PO Component immediately prior to such Distribution Date.
With respect to an Interest Accrual Period related to a Distribution
Date and the Class 4-A-X IO-2 Component, the Subordinated Portion for the
Group II Subordinated Certificates related to Loan Group 4 for that
Distribution Date.
Component Principal Balance: With respect to any date and the Class
1-A-X PO Component, an amount equal to (i) the aggregate Net Deferred Interest
allocated to the Class 1-A-X IO-1 and Class 1-A-X IO-2 Components pursuant to
Section 4.03 on all prior Distribution Dates minus (ii) all amounts actually
distributed as principal of the Class 1-A-X PO Component and all Realized
Losses applied in reduction of principal of the Class 1-A-X PO Component on
all prior Distribution Dates plus (iii) any increase in the Component
Principal Balance of the Class 1-A-X PO Component pursuant to Section 4.02 on
all prior Distribution Dates due to the receipt of Subsequent Recoveries.
With respect to any date and the Class 2-A-X PO Component, an amount
equal to (i) the aggregate Net Deferred Interest allocated to the Class 2-A-X
IO-1 and Class 2-A-X IO-2 Components pursuant to Section 4.03 on all prior
Distribution Dates minus (ii) all amounts actually distributed as principal of
the Class 2-A-X PO Component and all Realized Losses applied in reduction of
principal of the Class 2-A-X PO Component on all prior Distribution Dates plus
(iii) any increase in the Component Principal Balance of the Class 2-A-X PO
Component pursuant to Section 4.02 on all prior Distribution Dates due to the
receipt of Subsequent Recoveries.
With respect to any date and the Class 3-A-X PO Component, an amount
equal to (i) the aggregate Net Deferred Interest allocated to the Class 3-A-X
IO-1 and Class 3-A-X IO-2 Components pursuant to Section 4.03 on all prior
Distribution Dates minus (ii) all amounts
27
actually distributed as principal of the Class 3-A-X PO Component and all
Realized Losses applied in reduction of principal of the Class 3-A-X PO
Component on all prior Distribution Dates plus (iii) any increase in the
Component Principal Balance of the Class 3-A-X PO Component pursuant to
Section 4.02 on all prior Distribution Dates due to the receipt of Subsequent
Recoveries.
With respect to any date and the Class 4-A-X PO Component, an amount
equal to (i) the aggregate Net Deferred Interest allocated to the Class 4-A-X
IO-1 and Class 4-A-X IO-2 Components pursuant to Section 4.03 on all prior
Distribution Dates minus (ii) all amounts actually distributed as principal of
the Class 4-A-X PO Component and all Realized Losses applied in reduction of
principal of the Class 4-A-X PO Component on all prior Distribution Dates plus
(iii) any increase in the Component Principal Balance of the Class 4-A-X PO
Component pursuant to Section 4.02 on all prior Distribution Dates due to the
receipt of Subsequent Recoveries.
Confirmation: With respect to the LIBOR Certificates (other than the
Class 3-A-1 Certificates), the Confirmation (reference # FXNEC7072) dated May
27, 2005, evidencing a transaction between the applicable Corridor Contract
Counterparty and Countrywide Home Loans, Inc.
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 2005-24, facsimile no. (000) 000-0000, and which is the address to
which notices to and correspondence with the Trustee should be directed.
Corridor Contract: With respect to the LIBOR Certificates (other than
the Class 3-A-1 Certificates), the transaction evidenced by the Confirmation
(as assigned to the Corridor Contract Administrator pursuant to the Corridor
Contract Assignment Agreement).
Corridor Contract Administration Agreement: The corridor contract
administration agreement dated as of the Closing Date among Countrywide, the
Trustee and the Corridor Contract Administrator.
28
Corridor Contract Administrator: The Bank of New York, in its
capacity as corridor contract administrator under the Corridor Contract
Administration Agreement.
Corridor Contract Assignment Agreements: With respect to the LIBOR
Certificates (other than the Class 3-A-1 Certificates), the agreement, dated
as of the Closing Date, among Countrywide Home Loans, Inc., the Trustee and
each Corridor Contract Counterparty.
Corridor Contract Counterparties: Bear Xxxxxxx Financial Products
Inc.
Corridor Contract Scheduled Termination Date: The Distribution Date
in December 2015.
Countrywide: Countrywide Home Loans, Inc., a New York corporation and
its successors and assigns, in its capacity as the seller of the Countrywide
Mortgage Loans to the Depositor.
Countrywide Mortgage Loans: The Mortgage Loans identified as such on
the Mortgage Loan Schedule for which Countrywide is the applicable Seller.
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 Cross-Over Situation shall exist with respect to the Class A and
Class B Lower Tier REMIC I Interests or the Class A and Class B Lower Tier
REMIC II Interests, if the Class A and Class B Lower Tier REMIC I Interests or
Class A and Class B Lower Tier REMIC II Interests, as applicable,
corresponding to any Aggregate Loan Group are in the aggregate less than 1% of
the Subordinate Component Principal Balance of the Aggregate Loan Group to
which they correspond.
Cut-off Date: As to any Mortgage Loan, the later of the date of
origination of that Mortgage Loan and May 1, 2005.
Cut-off Date Pool Principal Balance: With respect to Aggregate Loan
Group I, $579,334,918, and with respect to Aggregate Loan Group II,
$875,359,710.
Cut-off Date Principal Balance: As to any Mortgage Loan, the Stated
Principal Balance thereof as of the close of business on the applicable
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.
Deferred Interest: With respect to each Negative Amortization Loan
and each related Due Period, the amount of interest accrued on such Negative
Amortization Loan at the
29
applicable Mortgage Rate from the Due Date in the preceding Due Period to the
Due Date in such Due Period that is greater than the Scheduled Payment due on
such Negative Amortization Loan for such Due Period and that is added to the
principal balance of such Negative Amortization Mortgage Loan in accordance
with the terms of the related Mortgage Note.
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).
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 of
that Certificate.
Depositor: CWALT, Inc., a Delaware corporation, or its successor in
interest.
Depository: The initial Depository shall be The Depository Trust
Company, the nominee of which is CEDE & Co., as the registered Holder of the
Book-Entry Certificates. The Depository shall at all times be a "clearing
corporation" as defined in Section 8-102(a)(5) of the Uniform Commercial Code
of the State of New York.
Depository Participant: A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
Determination Date: As to any Distribution Date, the 15th day of each
month or, if such 15th day is not a Business Day, the preceding Business Day;
provided, however, that if such 15th day or such Business Day, whichever is
applicable, is less than two Business Days prior to the
30
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 2005-24
Mortgage Pass-Through Certificates, Series 2005-24." 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 Business Day immediately following the Master
Servicer Remittance Date, commencing in June 2005.
Due Date: With respect to any Distribution Date, the first day of the
month in which that Distribution Date occurs.
Due Period: With respect to any Distribution Date, the period
beginning on the second day of the calendar month preceding the month in which
such Distribution Date occurs and ending on the first day of the calendar
month in which such Distribution Date occurs.
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 Xxxxx'x or Fitch and one of the two highest
short-term ratings of S&P, if S&P is a Rating Agency at the time any amounts
are held on deposit therein, or (ii) an account or accounts in a depository
institution or trust company in which such accounts are insured by the FDIC
(to the limits established by the FDIC) and the uninsured deposits in which
accounts are otherwise secured such that, as evidenced by an Opinion of
Counsel delivered to the Trustee and to each Rating Agency, the
Certificateholders have a claim with respect to the funds in such account or a
perfected first priority security interest against any collateral (which shall
be limited to Permitted Investments) securing such funds that is superior to
claims of any other depositors or creditors of the depository institution or
trust company in which such account is maintained, or (iii) a trust account or
accounts maintained with (a) the trust department of a federal or state
chartered depository institution or (b) a trust company, acting in its
fiduciary capacity or (iv) any other account acceptable to each Rating Agency.
Eligible Accounts may bear interest, and may include, if otherwise qualified
under this definition, accounts maintained with the Trustee.
Eligible Repurchase Month: As defined in Section 3.11.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA-Qualifying Underwriting: A best efforts or firm commitment
underwriting or private placement that meets the requirements of an
Underwriter's Exemption.
31
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.
Excess Proceeds: With respect to any Liquidated Mortgage Loan, the
amount, if any, by which the sum of any Liquidation Proceeds received with
respect to such Mortgage Loan during the calendar month in which such Mortgage
Loan became a Liquidated Mortgage Loan plus any Subsequent Recoveries received
with respect to such Mortgage Loan, net of any amounts previously reimbursed
to the Master Servicer as Nonrecoverable Advance(s) with respect to such
Mortgage Loan pursuant to Section 3.08(a)(iii), exceeds (i) the unpaid
principal balance of such Liquidated Mortgage Loan as of the Due Date in the
month in which such Mortgage Loan became a Liquidated Mortgage Loan plus (ii)
accrued interest at the Mortgage Rate from the Due Date as to which interest
was last paid or advanced (and not reimbursed) to Certificateholders up to the
Due Date applicable to the Distribution Date immediately following the
calendar month during which such liquidation occurred.
Expense Fee: As to each Mortgage Loan and any Distribution Date, the
product of the 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.
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.
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.
Gross Margin: With respect to each Mortgage Loan, the fixed
percentage set forth in the related Mortgage Note that is added to the
Mortgage Index on each Adjustment Date in accordance with the terms of the
related Mortgage Note used to determine the Mortgage Rate for such Mortgage
Loan.
32
Group 1 Senior Certificates: As specified in the Preliminary
Statement.
Group 1-X Subordinate Allocation Rate: The per annum rate equal to
the Weighted Average Adjusted Net Mortgage Rate of the Group 1 Mortgage Loans
minus the product of (x) 12 and (y) the Class Optimal Interest Distribution
Amount in respect of the Class 1-A-X-IO-2 Component, divided by the aggregate
Stated Principal Balance of the Group 1 Mortgage Loans. For federal income tax
purposes, the Group 1-X Subordinate Allocation Rate will equal the weighted
average of the Class MT-1-A-1 and Class MT-1-B-1 Interests, subjecting the
Class MT-1-B-1 Interests to a cap equal to zero.
Group 2 Senior Certificates: As specified in the Preliminary
Statement.
Group 2-X Subordinate Allocation Rate: The per annum rate equal to
the Weighted Average Adjusted Net Mortgage Rate of the Group 2 Mortgage Loans
minus the product of (x) 12 and (y) the Class Optimal Interest Distribution
Amount in respect of the Class 2-A-X-IO-2 Component, divided by the aggregate
Stated Principal Balance of the Group 2 Mortgage Loans. For federal income tax
purposes, the Group 2-X Subordinate Allocation Rate will equal the weighted
average of the Class MT-1-A-2 and Class MT-1-B-2 Interests, subjecting the
Class MT-1-B-2 Interests to a cap equal to zero.
Group 3 Senior Certificates: As specified in the Preliminary
Statement.
Group 4 Senior Certificates: As specified in the Preliminary
Statement.
Group I Certificates: As specified in the Preliminary Statement.
Group I Senior Certificates: As specified in the Preliminary
Statement.
Group I Subordinated Certificates: As specified in the Preliminary
Statement.
Group II Certificates: As specified in the Preliminary Statement.
Group II Senior Certificates: As specified in the Preliminary
Statement.
Group II Subordinated Certificates: As specified in the Preliminary
Statement.
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 Principal Balance: As set forth in the Preliminary
Statement.
Insurance Policy: With respect to any Mortgage Loan included in the
Trust Fund, any insurance policy, including all riders and endorsements
thereto in effect, including any replacement policy or policies for any
Insurance Policies.
33
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 any interest-bearing Class
of Certificates, other than any Class of LIBOR Certificates, and any
Distribution Date, the calendar month prior to the month of such Distribution
Date. With respect to any Class of LIBOR Certificates 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
immediately preceding that Distribution Date. Interest on any interest-bearing
Class of Certificates, other than any Class of LIBOR Certificates, shall be
calculated on the basis of a 360-day year consisting of twelve 30-day months.
Interest on any Class of LIBOR Certificates shall be calculated on the basis
of a 360-day year and the actual number of days elapsed.
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.
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, Loan Group 2, Loan Group 3 and Loan
Group 4, as applicable.
34
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 Group 3: All Mortgage Loans identified as Loan Group 3 Mortgage
Loans on the Mortgage Loan Schedule.
Loan Group 4: All Mortgage Loans identified as Loan Group 4 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.
Lower Tier REMIC: As described in the Preliminary Statement.
Lower Tier REMIC Regular Interest: As described in the Preliminary
Statement.
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 Servicing, a Texas limited partnership,
and its successors and assigns, in its capacity as master servicer hereunder.
Master Servicer Advance Date: As to any Distribution Date, 12:30 p.m.
Pacific time on the Business Day immediately preceding such Distribution Date.
Master Servicer Remittance Date: The 19th day of each calendar month,
or if such 19th day is not a Business Day, the next succeeding Business Day,
commencing in June 2005.
Master Servicing Fee: As to each Mortgage Loan and any Distribution
Date, an amount payable out of each full payment of interest received on such
Mortgage Loan and equal to one-twelfth of the Master Servicing Fee Rate
multiplied by the Stated Principal Balance of such Mortgage Loan as of the Due
Date in the month of such Distribution Date (prior to giving effect to any
Scheduled Payments due on such Mortgage Loan on such Due Date), subject to
reduction as provided in Section 3.14.
35
Master Servicing Fee Rate: With respect to each Mortgage Loan and Due
Date, the amount set forth in the Mortgage Loan Schedule for such Due Date.
Maximum Mortgage Rate: With respect to each Mortgage Loan, the
percentage set forth in the related Mortgage Note as the maximum Mortgage Rate
thereunder.
Maximum Negative Amortization: With respect to each Mortgage Loan,
the percentage set forth in the related Mortgage Note as the percentage of the
original principal balance of Mortgage Note, that if exceeded due to Deferred
Interest, will result in a recalculation of the Scheduled Payment so that the
then unpaid principal balance of the Mortgage Note will be fully amortized
over the Mortgage Loan's remaining term to maturity.
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.
Middle Tier REMIC: As described in the Preliminary Statement.
Middle Tier REMIC Regular Interest: As described in the Preliminary
Statement.
MIN: The Mortgage Identification Number for any MERS Mortgage Loan.
Minimum Mortgage Rate: With respect to each Mortgage Loan, the
greater of (a) the Gross Margin set forth in the related Mortgage Note and (b)
the percentage set forth in the related Mortgage Note as the minimum Mortgage
Rate thereunder.
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.
36
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 Index: As to each Mortgage Loan, the index from time to time
in effect for adjustment of the Mortgage Rate as set forth as such on the
related Mortgage Note.
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
Agreement as Schedule I, setting forth the following information with respect
to each Mortgage Loan by Loan Group:
(i) the loan number;
(ii) the Mortgagor's name and the street address of the
Mortgaged Property, including the ZIP code;
(iii) the maturity date;
(iv) the original principal balance;
(v) the Cut-off Date Principal Balance;
(vi) the first payment date of the Mortgage Loan;
(vii) the Scheduled Payment in effect as of the Cut-off
Date;
(viii) the Loan-to-Value Ratio at origination;
(ix) a code indicating whether the residential dwelling at
the time of origination was represented to be
owner-occupied;
(x) a code indicating whether the residential dwelling is
either (a) a detached 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), (d) a two- to
four-unit residential property or (e) a Cooperative Unit;
(xi) the Mortgage Rate in effect as of the Cut-off Date;
(xii) the Master Servicing Fee Rate both before and after
the initial Adjustment Date for each Mortgage Loan;
(xiii) a code indicating whether the Mortgage Loan is a
Lender PMI Mortgage Loan and, in the case of any Lender PMI
Mortgage Loan, a percentage representing the amount of the
related interest premium charged to the borrower;
(xiv) the purpose for the Mortgage Loan;
37
(xv) the type of documentation program pursuant to which the
Mortgage Loan was originated;
(xvi) 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;
(xvii) a code indicating whether the Mortgage Loan is a MERS
Mortgage Loan; and
(xviii) with respect to each Mortgage Loan, the Gross
Margin, the Mortgage Index, the Maximum Mortgage Rate, the
Minimum Mortgage Rate, the Payment Adjustment Date and the
Maximum Negative Amortization.
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 transferred and assigned
to the Trustee pursuant to the provisions of this Agreement as from time to
time 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 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.
MTA: The twelve-month moving average monthly yield on United States
Treasury Securities adjusted to a constant maturity of one year as published
by the Federal Reserve Board in the Federal Reserve Statistical Release
"Selected Interest Rates (H.15)", determined by averaging the monthly yields
for the most recently available twelve months.
National Cost of Funds Index: The National Monthly Median Cost of
Funds Ratio to SAIF-Insured Institutions published by the Office of Thrift
Supervision.
Negative Amortization Loans: Collectively, all of the Mortgage Loans.
Net Deferred Interest: With respect to any Loan Group and each
Distribution Date, an amount equal to the excess, if any, of the Deferred
Interest that accrued on the Mortgage Loans in that Loan Group for the related
Due Period over the Principal Prepayment Amount for the Mortgage Loans in that
Loan Group received during the related Prepayment Period.
38
Net Prepayment Interest Shortfalls: As to any Distribution Date and
Loan Group in an Aggregate Loan Group, the amount by which the aggregate of
Prepayment Interest Shortfalls for such Loan Group exceeds an amount equal to
the sum of (a) the Compensating Interest for such Loan Group for such
Distribution Date and (b) the excess, if any, of the Compensating Interest
with respect to the Mortgage Loans of each other Loan Group in the same
Aggregate Loan Group for such Distribution Date over the Prepayment Interest
Shortfalls experienced by the Mortgage Loans in such other Loan Groups.
Net Prepayments: As to any Distribution Date and any Loan Groups, the
amount equal to the excess, if any, of the (i) Principal Prepayment Amount for
that Loan Group over (ii) the aggregate amount of Deferred Interest accrued on
the Mortgage Loans in that Loan Group from the preceding Due Date to the Due
Date related to that Distribution Date.
Non-Delay Certificates: As specified in the Preliminary Statement.
Net WAC Cap: With respect to any Class of Senior Certificates in a
Senior Certificate Group for any Distribution Date will be the sum of (i) the
Weighted Average Adjusted Net Mortgage Rate of the Mortgage Loans in the
related Loan Group, adjusted for the related Interest Accrual Period in the
case of the Group 3 and Group 4 Senior Certificates and (ii) for the initial
Distribution Date, the product of (x) a percentage represented by a fraction,
the numerator of which is the amount on deposit in the related Capitalized
Interest Account and the denominator of which is the aggregate Stated
Principal Balance of the Mortgage Loans in the related Loan Group and (y) a
fraction, the numerator of which is 360 and the denominator of which is (1) in
the case of the Group 1 and Group 2 Senior Certificates, 30 and (2) in the
case of Group 3 and Group 4 Senior Certificates, the actual number of days in
the related Interest Accrual Period.
With respect to the Group I Subordinated Certificates for any
Distribution Date will be the sum of the following for each Loan Group in
Aggregate Loan Group I: the product of (x) the sum of (i) the Weighted Average
Adjusted Net Mortgage Rate of the Mortgage Loans in such Loan Group and (ii)
for the initial Distribution Date, the product of (1) a percentage represented
by a fraction, the numerator of which is the amount on deposit in the related
Capitalized Interest Account and the denominator of which is the aggregate
Stated Principal Balance of the Mortgage Loans in the related Loan Group and
(2) 12 and (y) a fraction, the numerator of which is the related Subordinated
Portion immediately prior to that Distribution Date, and the denominator of
which is the aggregate Class Certificate Balance of the Group I Subordinated
Certificates immediately prior to that Distribution Date.
With respect to the Group II Subordinated Certificates for any
Distribution Date will be the sum of the following for each Loan Group in
Aggregate Loan Group II: the product of (x) the sum of (i) the Weighted
Average Adjusted Net Mortgage Rate of the Mortgage Loans in such Loan Group
adjusted for the related Interest Accrual Period and (ii) for the initial
Distribution Date, the product of (1) a percentage represented by a fraction,
the numerator of which is the amount on deposit in the related Capitalized
Interest Account and the denominator of which is the aggregate Stated
Principal Balance of the Mortgage Loans in the related Loan Group and (2) a
fraction, the numerator of which is 360 and the denominator of which is the
actual number of days in the related Interest Accrual Period and (y) a
fraction, the numerator of which is the related Subordinated Portion
immediately prior to that Distribution Date, and the denominator of
39
which is the aggregate Class Certificate Balance of the Group II Subordinated
Certificates immediately prior to that Distribution Date.
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.
Offered Certificates: As specified in the Preliminary Statement.
Officer's Certificate: A certificate (i) in the case of the
Depositor, signed by the Chairman of the Board, the Vice Chairman of the
Board, the President, a Managing Director, a Vice President (however
denominated), an Assistant Vice President, the Treasurer, the Secretary, or
one of the Assistant Treasurers or Assistant Secretaries of the Depositor,
(ii) in the case of the Master Servicer, signed by the President, an Executive
Vice President, a Vice President, an Assistant Vice President, the Treasurer,
or one of the Assistant Treasurers or Assistant Secretaries of Countrywide GP,
Inc. (its general partner) or (iii) if provided for in this Agreement, signed
by a Servicing Officer, as the case may be, and delivered to the Depositor and
the Trustee, as the case may be, as required by this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be counsel
for the Depositor, any Seller 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 the Depositor, any Seller and the
Master Servicer, (ii) not have any direct financial interest in the Depositor,
any Seller or the Master Servicer or in any affiliate of either, and (iii) not
be connected with the Depositor, any Seller or the Master Servicer as an
officer, employee, promoter, underwriter, trustee, partner, director or person
performing similar functions.
Optional Termination: As to the Aggregate Loan Group I or Aggregate
Loan Group II, the termination of the related portion of the trust created
under this Agreement in connection with the purchase of the related Mortgage
Loans pursuant to Section 9.01.
Optional Termination Date: With respect to an Aggregate Loan Group,
the Distribution Date on which the Pool Stated Principal Balance of such
Aggregate Loan Group is less than or equal to 10% of the aggregate Cut-off
Date Principal Balance of the Mortgage Loans in such Aggregate Loan Group.
40
Original Applicable Credit Support Percentage: With respect to each
of the following Classes of Subordinated Certificates, the corresponding
percentage described below, as of the Closing Date:
Group I Subordinated Certificates
-----------------------------------------------------
Class I-M............................ 8.70%
Class I-B-1.......................... 4.00%
Class I-B-2.......................... 2.75%
Class I-B-3.......................... 1.90%
Class I-B-4.......................... 1.10%
Class I-B-5.......................... 0.50%
Group II Subordinated Certificates
-----------------------------------------------------
Class II-M-1......................... 8.70%
Class II-B-1......................... 4.25%
Class II-B-2......................... 2.90%
Class II-B-3......................... 2.10%
Class II-B-4......................... 1.20%
Class II-B-5......................... 0.50%
Original Mortgage Loan: The mortgage loan refinanced in connection
with the origination of a Refinancing Mortgage Loan.
Original Subordinate Principal Balance: For the Group I Certificates
and a Loan Group in Aggregate Loan Group I, (a) if such date is on or prior to
the first related Senior Termination Date, the Subordinated Percentage for
such Loan Group of the aggregate Stated Principal Balances of the Mortgage
Loans in that Loan Group, in each case, as of the Cut-off Date or (b) if such
date is after the first related Senior Termination Date, the aggregate Class
Certificate Balance of the Group I Subordinated Certificates as of the Closing
Date. For the Group II Certificates and a Loan Group in Aggregate Loan Group
II, (a) if such date is on or prior to the first related Senior Termination
Date, the Subordinated Percentage for such Loan Group of the aggregate Stated
Principal Balances of the Mortgage Loans in that Loan Group, in each case, as
of the Cut-off Date or (b) if such date is after the first related Senior
Termination Date, the aggregate Class Certificate Balance of the Group II
Subordinated Certificates as of the Closing Date.
OTS: The Office of Thrift Supervision.
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.
41
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 such Due Date and which did not become a
Liquidated Mortgage Loan prior to such Due Date.
Overcollateralized Group: As defined in Section 4.05.
Ownership Interest: As to any Residual Certificate, any ownership
interest in such Certificate including any interest in such Certificate as the
Holder thereof and any other interest therein, whether direct or indirect,
legal or beneficial.
Park Granada: Park Granada LLC, a Delaware limited liability company,
and its successors and assigns, in its capacity as the seller of the Park
Granada Mortgage Loans to the Depositor.
Park Granada Mortgage Loans: The Mortgage Loans identified as such on
the Mortgage Loan Schedule for which Park Granada is the applicable Seller.
Park Monaco: Park Monaco Inc., a Delaware corporation, and its
successors and assigns, in its capacity as the seller of the Park Monaco
Mortgage Loans to the Depositor.
Park Monaco Mortgage Loans: The Mortgage Loans identified as such on
the Mortgage Loan Schedule for which Park Monaco is the applicable Seller.
Park Sienna: Park Sienna LLC, a Delaware limited liability company,
and its successors and assigns, in its capacity as the seller of the Park
Sienna Mortgage Loans to the Depositor.
Park Sienna Mortgage Loans: The Mortgage Loans identified as such on
the Mortgage Loan Schedule for which Park Sienna is the applicable Seller.
Pass-Through Margin: With respect to any Distribution Date and each
Class of LIBOR Certificates and MTA Certificates, the per annum rate indicated
in the following table:
42
Pass-Through Pass-Through
Class Margin (1) Margin (2)
------------------------ ------------------ --------------------
Class 1-A-1............. 1.31% 1.31%
Class 1-A-2............. 1.43% 1.43%
Class 2-A-1A............ 1.31% 1.31%
Class 2-A-1B............ 1.31% 1.31%
Class 2-A-1C............ 1.31% 1.31%
Class 2-A-2............. 1.43% 1.43%
Class 3-A-1............. 0.26% 0.52%
Class 3-A-2............. 0.40% 0.80%
Class 4-A-1............. 0.23% 0.46%
Class 4-A-2............. 0.30% 0.60%
Class 4-A-3............. 0.37% 0.74%
Class I-M............... 1.19% 1.19%
Class I-B-1............. 1.69% 1.69%
Class I-B-2............. 2.00% 2.00%
Class I-B-3............. 2.00% 2.00%
Class I-B-4............. 2.00% 2.00%
Class I-B-5............. 2.00% 2.00%
Class II-M.............. 0.50% 0.750%
Class II-B-1............ 0.75% 1.125%
Class II-B-2............ 1.25% 1.875%
Class II-B-3............ 1.25% 1.875%
Class II-B-4............ 1.25% 1.875%
Class II-B-5............ 1.25% 1.875%
(1) For the Interest Accrual Period related to any
Distribution Date occurring on or prior to the
first possible Optional Termination Date for the
Aggregate Loan Group related to such Class of
Certificates.
(2) For each other Interest Accrual Period.
Pass-Through Rate: For any interest-bearing Class of Certificates or
Component, the per annum rate set forth or calculated in the manner described
in the Preliminary Statement.
Payment Adjustment Date: For each Mortgage Loan, the date specified
in the related Mortgage Note as the annual date on which the Mortgage Rate on
the related Scheduled Payment will be adjusted.
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.
Periodic Rate Cap: With respect to each Mortgage Loan (other than
Negative Amortization Loans) and any Adjustment Date therefor, the fixed
percentage set forth in the related Mortgage Note, which is the maximum amount
by which the Mortgage Rate for such Mortgage Loan may increase or decrease
(without regard to the Maximum Mortgage Rate or the
43
Minimum Mortgage Rate) on such Adjustment Date from the Mortgage Rate in
effect immediately prior to such Adjustment Date.
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
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
44
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.
Planned Balance: With respect to any Planned Principal Class or
Component and any Distribution Date appearing in Schedule V, the amount
appearing opposite such Distribution Date for such Class or Component.
Planned Principal Classes: As specified in the Preliminary Statement.
Planned Principal Components: As specified in the Preliminary
Statement.
Pool Stated Principal Balance: As to any Distribution Date and an
Aggregate Loan Group, the aggregate of the Stated Principal Balances of the
Mortgage Loans in such Aggregate
45
Loan Group that were Outstanding Mortgage Loans on the Due Date in the month
preceding the month of such Distribution Date and, as to any other date of
determination, the aggregate of the Stated Principal Balances of the
Outstanding Mortgage Loans in such Aggregate Loan Group as of such date.
Prepayment Interest Shortfall: As to any Distribution Date, any
Mortgage Loan and any Principal Prepayment received during the portion of the
related Prepayment Period occurring in the calendar 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 Mortgage Loan, the
period beginning on the second day of the calendar month preceding the month
in which such Distribution Date occurs and ending on the first day of the
calendar month in which such Distribution Date occurs.
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 Amount: As to any Distribution Date and any Loan Group, the
sum 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 (other than a Liquidated
Mortgage Loan) in that Loan Group during the related Due Period, (b) the
principal portion of the Purchase Price of each Mortgage Loan in the related
Loan Group that was repurchased by a Seller or purchased by the Master
Servicer pursuant to this Agreement as of such Distribution Date, (c) the
Substitution Adjustment Amount in connection with any Deleted Mortgage Loan in
such 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 the related 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 a
Loan Group that became a Liquidated Mortgage Loan during the calendar month
preceding the month of such Distribution Date, the amount of the Net
Liquidation Proceeds allocable to principal received during the calendar month
preceding the month of such Distribution Date with respect to such Mortgage
Loan, (f) Net Prepayments on the Mortgage Loans in that Loan Group received
during the related Prepayment Period and (g) the principal portion of any
Transfer Payments Received for such Loan Group, minus the principal portion of
any Transfer Payments Made for such Loan Group and Distribution Date in
accordance with Section 4.05.
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
46
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 Amount: As to any Distribution Date and each
Loan Group, an amount equal to the sum of all voluntary Principal Prepayments
received on the Mortgage Loans in that Loan Group during the related
Prepayment Period and the amount of any Subsequent Recoveries received in the
prior calendar month with respect to Mortgage Loans in that Loan Group.
Principal Prepayment in Full: Any Principal Prepayment made by a
Mortgagor of the entire principal balance of a Mortgage Loan.
Principal Relocation Payment: A payment from any Lower Tier REMIC
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 Amount from a Loan
Group and shall also consist of a proportionate allocation of Realized Losses
from the Mortgage Loans of a Loan Group.
Private Certificate: As specified in the Preliminary Statement.
Pro Rata Share: As to any Distribution Date, the Subordinated
Principal Distribution Amount for an Aggregate Loan Group and any related
Class of Subordinated Certificates, the portion of the related Subordinated
Principal Distribution Amount allocable to such Class, equal to the product of
the related Subordinated Principal Distribution Amount on such Distribution
Date and a fraction, the numerator of which is the related Class Certificate
Balance thereof and the denominator of which is the aggregate of the Class
Certificate Balances of the Group I Subordinated Certificates or Group II
Subordinated Certificates, as applicable.
Pro Rata Subordinated Percentage: As to any Distribution Date and
Loan Group, 100% minus the related Senior Percentage for such Distribution
Date.
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 April 21, 2005 generally relating to
mortgage-pass through certificates to be sold by the Depositor.
Prospectus Supplement: The prospectus supplement dated May 26, 2005
relating to the Offered Certificates.
PUD: Planned Unit Development.
Purchase Price: With respect to any Mortgage Loan required to be
purchased by a Seller pursuant to Section 2.02 or 2.03 of this Agreement 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
47
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 of this Agreement 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 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 that 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 that 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 those 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.
48
Record Date: With respect to any Distribution Date, (i) in the case
of the LIBOR Certificates represented by Book-Entry Certificates, the Business
Day immediately preceding such Distribution Date and (ii) in the case of LIBOR
Certificates represented by Definitive Certificates and in the case of all
other Certificates, the close of business on the last Business Day of the
month preceding the month in which such Distribution Date occurs.
Reference Bank: As defined in Section 4.08(b).
Refinancing Mortgage Loan: Any Mortgage Loan originated in connection
with the refinancing of an existing mortgage loan.
Regular Certificates: As specified in the Preliminary Statement.
Relief Act: The Servicemembers' Civil Relief Act or any similar state
laws.
Relief Act Reductions: With respect to any Distribution Date and any
Mortgage Loan as to which there has been a reduction in the amount of interest
collectible thereon for the most recently ended calendar month as a result of
the application of the Relief Act, the amount, if any, by which (i) interest
collectible on such Mortgage Loan for the most recently ended calendar month
is less than (ii) interest accrued thereon for such month pursuant to the
Mortgage Note.
REMIC: A "real estate mortgage investment conduit" within the meaning
of section 860D of the Code.
REMIC Change of Law: Any proposed, temporary or final regulation,
revenue ruling, revenue procedure or other official announcement or
interpretation relating to REMICs and the REMIC Provisions issued after the
Closing Date.
REMIC Provisions: Provisions of the federal income tax law relating
to real estate mortgage investment conduits, which appear at Sections 860A
through 860G of Subchapter M of Chapter 1 of the Code, and related provisions,
and regulations promulgated thereunder, as the foregoing may be in effect from
time to time as well as provisions of applicable state laws.
REO Property: A Mortgaged Property acquired by the Trust Fund through
foreclosure or deed-in-lieu of foreclosure in connection with a defaulted
Mortgage Loan.
Request for Release: The Request for Release submitted by the Master
Servicer to the Trustee, substantially in the form of Exhibits M and N to this
Agreement, as appropriate.
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.
49
Restricted Classes: As defined in Section 4.02(e).
Scheduled Payment: The scheduled monthly payment on a Mortgage Loan
due in the related Due Period 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 Certificate Group: As specified in the Preliminary Statement.
Senior Certificates: As specified in the Preliminary Statement.
Senior Credit Support Depletion Date: With respect to the Group I
Senior Certificates and the Group II Senior Certificates, as applicable, the
date on which the aggregate Class Certificate Balance of the Group I
Subordinated Certificates and Group II Subordinated Certificates,
respectively, has been reduced to zero.
Senior Percentage: As to any Senior Certificate Group and
Distribution Date, the percentage equivalent of a fraction the numerator of
which is the aggregate Class Certificate Balance of each Class of Senior
Certificates of such Senior Certificate Group (other than the Notional Amount
Certificates) immediately prior to such Distribution Date and the denominator
of which is the aggregate of the Stated Principal Balance of each Mortgage
Loan in the related Loan Group as of the first day of the related Due Period;
provided, however, that, (x) with respect to the Group I Senior Certificates,
on any Distribution Date after the first related Senior Termination Date, the
Senior Percentage for the Senior Certificates of the related remaining Senior
Certificate Group is the percentage equivalent of a fraction, the numerator of
which is the aggregate of the Class Certificate Balances of each such Class of
Senior Certificates (other than the Notional Amount Certificates) immediately
prior to such Distribution Date and the denominator of which is the aggregate
of the Class Certificate Balances of all Classes of Group I Certificates
(other than the Notional Amount Certificates) immediately prior to such
Distribution Date and (y) with respect to the Group II Senior Certificates, on
any Distribution Date after the first related Senior Termination Date, the
Senior Percentage for the Senior Certificates of the related remaining Senior
Certificate Group is the percentage equivalent of a fraction, the numerator of
which is the aggregate of the Class Certificate Balances of each such Class of
Senior Certificates (other than the Notional Amount Certificates) immediately
prior to such Distribution Date and the denominator of which is the aggregate
of the Class Certificate Balances of the Group II Certificates immediately
prior to such Distribution Date. In no event will any Senior Percentage be
greater than 100%.
Senior Prepayment Percentage: As to the Group I Senior Certificates
and any Distribution Date during the ten years beginning on the first
Distribution Date, 100%. The related Senior Prepayment Percentage for any
Distribution Date occurring on or after the tenth anniversary of the first
Distribution Date will, except as provided in this Agreement, be as follows:
for any Distribution Date in the first year thereafter, the related Senior
Percentage plus 70% of the
50
related Subordinated Percentage for such Distribution Date; for any
Distribution Date in the second year thereafter, the related Senior Percentage
plus 60% of the related Subordinated Percentage for such Distribution Date;
for any Distribution Date in the third year thereafter, the related Senior
Percentage plus 40% of the related Subordinated Percentage for such
Distribution Date; for any Distribution Date in the fourth year thereafter,
the related Senior Percentage plus 20% of the related Subordinated Percentage
for such Distribution Date; and for any Distribution Date thereafter, the
related Senior Percentage for such Distribution Date (unless on any
Distribution Date the related Senior Percentage exceeds the Senior Percentage
of such Senior Certificate Group as of the Closing Date, in which case the
related Senior Prepayment Percentage for such Distribution Date will once
again equal 100%). Notwithstanding the foregoing, no decrease in the related
Senior Prepayment Percentage will occur unless both of the Senior Step Down
Conditions are satisfied with respect to each Loan Group in Aggregate Loan
Group I. Notwithstanding the foregoing, if the Two Times Test is satisfied
with respect to the Group I Certificates on a Distribution Date, the Senior
Prepayment Percentage for each Loan Group in Aggregate Loan Group I will equal
(x) if such Distribution Date is on or prior to the Distribution Date in May
2008, the related Senior Percentage for such Distribution Date plus 50% of the
related Subordinated Percentage for the Distribution Date and (y) if such
Distribution Date is after the Distribution Date in May 2008, the related
Senior Percentage.
As to the Group II Senior Certificates and any Distribution Date
during the ten years beginning on the first Distribution Date, 100%. The
related Senior Prepayment Percentage for any Distribution Date occurring on or
after the tenth anniversary of the first Distribution Date will, except as
provided in this Agreement, be as follows: for any Distribution Date in the
first year thereafter, the related Senior Percentage plus 70% of the related
Subordinated Percentage for such Distribution Date; for any Distribution Date
in the second year thereafter, the related Senior Percentage plus 60% of the
related Subordinated Percentage for such Distribution Date; for any
Distribution Date in the third year thereafter, the related Senior Percentage
plus 40% of the related Subordinated Percentage for such Distribution Date;
for any Distribution Date in the fourth year thereafter, the related Senior
Percentage plus 20% of the related Subordinated Percentage for such
Distribution Date; and for any Distribution Date thereafter, the related
Senior Percentage for such Distribution Date (unless on any Distribution Date
the related Senior Percentage exceeds the Senior Percentage of such Senior
Certificate Group as of the Closing Date, in which case the related Senior
Prepayment Percentage for such Distribution Date will once again equal 100%).
Notwithstanding the foregoing, no decrease in the related Senior Prepayment
Percentage will occur unless both of the Senior Step Down Conditions are
satisfied with respect to each Loan Group in Aggregate Loan Group II.
Notwithstanding the foregoing, if the Two Times Test is satisfied with respect
to the Group II Certificates on a Distribution Date, the Senior Prepayment
Percentage for each Loan Group in Aggregate Loan Group II will equal (x) if
such Distribution Date is on or prior to the Distribution Date in May 2008,
the related Senior Percentage for such Distribution Date plus 50% of the
related Subordinated Percentage for the Distribution Date and (y) if such
Distribution Date is after the Distribution Date in May 2008, the related
Senior Percentage.
Senior Principal Distribution Amount: As to any Distribution Date and
Senior Certificate Group, the sum of (i) the related Senior Percentage of all
amounts described in clauses (a) through (d) of the definition of "Principal
Amount" with respect to the related Loan Group for such Distribution Date,
(ii) with respect to any Mortgage Loan in the related Loan Group that
51
became a Liquidated Mortgage Loan during the calendar month preceding the
month of such Distribution Date, the lesser of (x) the related Senior
Percentage of the Stated Principal Balance of such Mortgage Loan as of the
first day of the related Due Period and (y) the related Senior Prepayment
Percentage of the amount of the Net Liquidation Proceeds allocable to
principal received on the Mortgage Loan, (iii) the related Senior Prepayment
Percentage of the Net Prepayments for such Distribution Date; (iv) the
principal portion of any Transfer Payments Received for that Loan Group and
Distribution Date; provided, however, on any Distribution Date after (x) the
first related Senior Termination Date, with respect to the Group I Senior
Certificates, and (y) the first related Senior Termination Date, with respect
to the Group II Certificates, the Senior Principal Distribution Amount for the
related remaining Senior Certificate Group will be calculated pursuant to the
above formula based on all the Mortgage Loans in the related Aggregate Loan
Group, as opposed to the Mortgage Loans in the related Loan Group.
Senior Step Down Conditions: With respect to each Loan Group in
Aggregate Loan Group I and after the first Senior Termination Date, with
respect to all Mortgage Loans in Aggregate Loan Group I: (i) the outstanding
principal balance of such Mortgage Loans delinquent 60 days or more (including
Mortgage Loans in foreclosure, REO Property and Mortgage Loans the Mortgagors
of which are in bankruptcy) (averaged over the preceding six month period),
does not exceed 50% of (a) if such date is on or prior to the first related
Senior Termination Date, the Subordinated Percentage for such Loan Group of
the aggregate Stated Principal Balances of the Mortgage Loans in that Loan
Group, or (b) if such date is after the first related Senior Termination Date,
the aggregate Class Certificate Balance of the Group I Subordinated
Certificates for such Distribution Date does not equal or exceed 50%, and (ii)
cumulative Realized Losses on such Mortgage Loans do not exceed: (a)
commencing with the Distribution Date on the tenth anniversary of the first
Distribution Date, 30% of the related Original Subordinate Principal Balance,
(b) commencing with the Distribution Date on the eleventh anniversary of the
first Distribution Date, 35% of the related Original Subordinate Principal
Balance, (c) commencing with the Distribution Date on the twelfth anniversary
of the first Distribution Date, 40% of the related Original Subordinate
Principal Balance, (d) commencing with the Distribution Date on the thirteenth
anniversary of the first Distribution Date, 45% of the related Original
Subordinate Principal Balance and (e) commencing with the Distribution Date on
the fourteenth anniversary of the first Distribution Date, 50% of the related
Original Subordinate Principal Balance.
With respect to each Loan Group in Aggregate Loan Group II and after
the first Senior Termination Date, with respect to all Mortgage Loans in
Aggregate Loan Group II (i) the outstanding principal balance of such Mortgage
Loans delinquent 60 days or more (including Mortgage Loans in foreclosure, REO
Property and Mortgage Loans the Mortgagors of which are in bankruptcy)
(averaged over the preceding six month period), does not exceed 50% of (a) if
such date is on or prior to the first related Senior Termination Date, the
Subordinated Percentage for such Loan Group of the aggregate Stated Principal
Balances of the Mortgage Loans in that Loan Group, or (b) if such date is
after the first related Senior Termination Date, the aggregate Class
Certificate Balance of the Group II Subordinated Certificates for such
Distribution Date does not equal or exceed 50%, and (ii) cumulative Realized
Losses on such Mortgage Loans do not exceed: (a) commencing with the
Distribution Date on the tenth anniversary of the first Distribution Date, 30%
of the related Original Subordinate Principal Balance, (b) commencing
52
with the Distribution Date on the eleventh anniversary of the first
Distribution Date, 35% of the related Original Subordinate Principal Balance,
(c) commencing with the Distribution Date on the twelfth anniversary of the
first Distribution Date, 40% of the related Original Subordinate Principal
Balance, (d) commencing with the Distribution Date on the thirteenth
anniversary of the first Distribution Date, 45% of the related Original
Subordinate Principal Balance and (e) commencing with the Distribution Date on
the fourteenth anniversary of the first Distribution Date, 50% of the related
Original Subordinate Principal Balance.
Senior Termination Date: For each Senior Certificate Group, the
Distribution Date on which the aggregate Class Certificate Balance of the
related Classes of Senior Certificates have 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 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.
S&P: Standard & Poor's Ratings Services, 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 Ratings Services, 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.
Startup Day: The Closing Date.
Stated Principal Balance: As to any Mortgage Loan and Due Date, the
unpaid principal balance of such Mortgage Loan as of such Due Date as
specified in 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, (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, and (iii)
with respect to any Negative Amortization Loan, any Deferred Interest added to
the principal balance of that Mortgage Loan pursuant to the terms of the
related Mortgage Note on or prior to that Due Date.
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
53
Loan Documentation Program if that Mortgagor is refinancing an existing
mortgage loan that was originated or acquired by Countrywide where, among
other things, the mortgage loan has not been more than 30 days delinquent in
payment during the previous twelve month period.
Subordinate Pass-Through Rate: For the Interest Accrual Period
related to each Distribution Date and each Aggregate Loan Group, a per annum
rate equal to (1) the sum of the following for each Loan Group in the
applicable Aggregate Loan Group: the product of (x) the Weighted Average
Adjusted Net Mortgage Rate of the related Mortgage Loans and (y) the related
Subordinated Portion immediately prior to that Distribution Date, divided by
(2) the aggregate Class Certificate Balance of the related Subordinated
Certificates immediately prior to that Distribution Date.
Subordinated Certificates: As specified in the Preliminary Statement.
Subordinated Percentage: As to any Distribution Date and Loan Group
on or prior to (x) the first related Senior Termination Date, with respect to
the Group I Senior Certificates and (y) the first related Senior Termination
Date, with respect to the Group II Senior Certificates, 100% minus the Senior
Percentage for the Senior Certificate Group relating to such Loan Group for
such Distribution Date. As to any Distribution Date after (x) the first
related Senior Termination Date, with respect to the Group I Senior
Certificates and (y) the first related Senior Termination Date, with respect
to the Group II Senior Certificates, 100% minus the related Senior Percentage
for such Certificates for such Distribution Date.
Subordinated Portion: For any Distribution Date and a Loan Group in
an Aggregate Loan Group, an amount equal to the aggregate Stated Principal
Balance of the Mortgage Loans in that Loan Group as of the first day of the
related Due Period minus the sum of the Class Certificate Balances of the
related Classes of Senior Certificates immediately prior to such Distribution
Date.
Subordinated Prepayment Percentage: As to any Distribution Date and
Loan Group, 100% minus the related Senior Prepayment Percentage for such
Distribution Date.
Subordinated Principal Distribution Amount: With respect to any
Distribution Date and the Group I Subordinated Certificates, the sum of the
following amounts for each Loan Group in Aggregate Loan Group I: an amount
equal to the excess of (A) the sum of (i) the Subordinated Percentage of all
amounts described in clauses (a) through (d) of the definition of "Principal
Amount" for that Loan Group and that Distribution Date, (ii) with respect to
each Mortgage Loan in that Loan Group that became a Liquidated Mortgage Loan
during the calendar month preceding the month of such Distribution Date, the
Liquidation Proceeds allocated to principal received with respect thereto
remaining after application thereof pursuant to clause (ii) of the definition
of "Senior Principal Distribution Amount", up to the related Subordinated
Percentage for such Loan Group of the Stated Principal Balance of that
Mortgage Loan as of the first day of the related Due Period, and (iii) the
related Subordinated Prepayment Percentage for that Loan Group of the Net
Prepayments for such Loan Group and Distribution Date over (B) the principal
portion of any Transfer Payments Made for such Loan Group; provided, however,
that on any Distribution Date after the first related Senior Termination Date,
the Subordinated Principal Distribution Amount will not be calculated by Loan
Group but will equal the amount calculated pursuant to the formula set forth
above based on the applicable Subordinated Percentage and
54
Subordinated Prepayment Percentage, as applicable, for the Group I
Subordinated Certificates for such Distribution Date with respect to all of
the Mortgage Loans in Aggregate Loan Group I as opposed to the Mortgage Loans
only in the related Loan Group.
With respect to any Distribution Date and the Group II Subordinated
Certificates, the sum of the following amounts for each Loan Group in
Aggregate Loan Group II, an amount equal to the excess of (A) the sum of (i)
the Subordinated Percentage of all amounts described in clauses (a) through
(d) of the definition of "Principal Amount" for that Loan Group and that
Distribution Date, (ii) with respect to each Mortgage Loan in that Loan Group
that became a Liquidated Mortgage Loan during the calendar month preceding the
month of such Distribution Date, the Liquidation Proceeds allocated to
principal received with respect thereto remaining after application thereof
pursuant to clause (ii) of the definition of "Senior Principal Distribution
Amount", up to the related Subordinated Percentage for such Loan Group of the
Stated Principal Balance of that Mortgage Loan, and (iii) the related
Subordinated Prepayment Percentage for that Loan Group of the Net Prepayments
for such Loan Group and Distribution Date over (B) the principal portion of
any Transfer Payments Made for such Loan Group; provided, however, that on any
Distribution Date after the first related Senior Termination Date, the
Subordinated Principal Distribution Amount will not be calculated by Loan
Group but will equal the amount calculated pursuant to the formula set forth
above based on the applicable Subordinated Percentage and Subordinated
Prepayment Percentage, as applicable, for the Group II Subordinated
Certificates for such Distribution Date with respect to all of the Mortgage
Loans in Aggregate Loan Group II as opposed to the Mortgage Loans only in the
related Loan Group.
Subsequent Recoveries: As to any Distribution Date, with respect to a
Liquidated Mortgage Loan that resulted in a Realized Loss in a prior calendar
month, unexpected amounts received by the Master Servicer (net of any related
expenses permitted to be reimbursed pursuant to Section 3.08) specifically
related to such Liquidated Mortgage Loan.
Subservicer: Any person to whom the Master Servicer has contracted
for the servicing of all or a portion of the Mortgage Loans pursuant to
Section 3.02.
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 Mortgage Rate not more than 1% per annum higher or lower than, that of
the Deleted Mortgage Loan; (vi) have a Minimum Mortgage Rate 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, 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
or a Negative Amortization Mortgage Loan unless the Deleted Mortgage Loan was
a Cooperative Loan or a Negative Amortization Loan, as applicable; (ix) if the
Deleted Mortgage Loan is a Negative Amortization
55
Loan, have the same Maximum Negative Amortization, payment cap and recast
provisions as the Deleted Mortgage Loan; and (x) 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.
Tax Matters Person: The person designated as "tax matters person" in
the manner provided under Treasury regulation ss. 1.860F-4(d) and temporary
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.
Transfer: Any direct or indirect transfer or sale of any Ownership
Interest in a Residual Certificate.
Transfer Payment Made: As defined in Section 4.05.
Transfer Payment Received: As defined in Section 4.05.
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 Carryover Shortfall Reserve Fund, the Capitalized
Interest Account and the Distribution Account and all amounts deposited
therein pursuant to the applicable provisions of this Agreement; (iii)
property that secured a Mortgage Loan and has been acquired by foreclosure,
deed-in-lieu of foreclosure or otherwise; (iv) the rights to receive certain
proceeds of the Corridor Contract as provided in the Corridor Contract
Administration Agreement; and (v) all proceeds of the conversion, voluntary or
involuntary, of any of the foregoing.
Trustee: The Bank of New York and its successors and, if a successor
trustee is appointed 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 of each Aggregate Loan Group with respect to such Distribution Date.
Trustee Fee Rate: With respect to each Mortgage Loan, the per annum
rate agreed upon in writing on or prior to the Closing Date by the Trustee and
the Depositor.
Two Times Test: As to any Distribution Date and the Group I
Subordinated Certificates, if (i) the Aggregate Subordinated Percentage for
the Group I Subordinated Certificates is at least 200% of the related
Aggregate Subordinated Percentage as of the Closing Date, (ii) clause (i) of
56
the Senior Step Down Conditions is satisfied with respect to Aggregate Loan
Group I and (iii) the cumulative Realized Losses on all the Mortgage Loans in
Aggregate Loan Group I do not exceed (x) with respect to any Distribution Date
on or prior to May 2008, 20% of the aggregate Class Certificate Balance of the
Group I Subordinated Certificates as of the Closing Date or (y) with respect
to any Distribution Date after May 2008, 30% of the aggregate Class
Certificate Balance of the Group I Subordinated Certificates as of the Closing
Date.
As to any Distribution Date and the Group II Subordinated
Certificates, if (i) the Aggregate Subordinated Percentage for the Group II
Subordinated Certificates is at least 200% of the related Aggregate
Subordinated Percentage as of the Closing Date, (ii) clause (i) of the Senior
Step Down Conditions is satisfied with respect to Aggregate Loan Group II,
(iii) the cumulative Realized Losses on all the Mortgage Loans in Aggregate
Loan Group II do not exceed (x) with respect to any Distribution Date on or
prior to May 2008, 20% of the aggregate Class Certificate Balance of the Group
II Subordinated Certificates as of the Closing Date or (y) with respect to any
Distribution Date after May 2008, 30% of the aggregate Class Certificate
Balance of the Group II Subordinated Certificates as of the Closing Date.
Undercollateralized Group: As defined in Section 4.05.
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.
Underwriter: As specified in the Preliminary Statement.
Voting Rights: The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. As of any date of
determination, (a) 1% of all Voting Rights shall be allocated to each Class of
Notional Amount Certificates, if any (such Voting Rights to be allocated among
the holders of Certificates of each such Class in accordance with their
respective Percentage Interests), and (b) the remaining Voting Rights (or 100%
of the Voting Rights if there is no Class of Notional Amount Certificates)
shall be allocated among Holders of the remaining Classes of Certificates in
proportion to the Certificate Balances of their respective Certificates on
such date.
Weighted Average Adjusted Net Mortgage Rate: As to any Distribution
Date and for each Loan Group, the average of the Adjusted Net Mortgage Rate of
each Mortgage Loan in that Loan Group, weighted on the basis of its Stated
Principal Balance as of the first day of the related Due Period.
Yield Supplement Amount: For any Distribution Date, on or prior to
the Corridor Contract Termination Date, on which LIBOR exceeds the applicable
Strike Rate, the related Yield Supplement Amount will equal an amount equal to
interest for the related Interest Accrual Period on the Class Certificate
Balance of the applicable Class of Certificates immediately prior to such
Distribution Date at a rate equal to the excess of (i) the lesser of LIBOR and
11.00% over (ii) the applicable Strike Rate. The Strike Rate for each
applicable Distribution Date is set forth on page S-96 of the Prospectus
Supplement.
57
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
SECTION 2.01. Conveyance of Mortgage Loans
(a) Each Seller concurrently with the execution and delivery hereof,
hereby sells, transfers, assigns, sets over and otherwise conveys to the
Depositor, without recourse, all its respective right, title and interest in
and to the related Mortgage Loans, including all interest and principal
received or receivable by such Seller, on or with respect to the 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 both 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 Distribution Date, Countrywide shall deposit
into the Distribution Account on or before the Distribution Account Deposit
Date relating to the first applicable Distribution Date, an amount equal to
one month's interest at the related Adjusted Mortgage Rate on the Cut-off Date
Principal Balance of such Mortgage Loan.
Countrywide further agrees (x) to cause The Bank of New York to enter
into the Corridor Contract Administration Agreement as Corridor Contract
Administrator and (y) to assign all of its right, title and interest in and to
the interest rate corridor transaction evidenced by the Confirmation, and to
cause all of its obligations in respect of such transaction to be assumed by,
the Corridor Contract Administrator, on the terms and conditions set forth in
the Corridor Contract Assignment Agreement.
(b) Immediately upon the conveyance of the Mortgage Loans referred to
in clause (a), the Depositor sells, transfers, assigns, sets over and
otherwise conveys to the Trustee for the benefit of the Certificateholders,
without recourse, all the right, title and interest of the Depositor in and to
the Trust Fund together with the Depositor's right to require each Seller to
cure any breach of a representation or warranty made herein by such Seller, or
to repurchase or substitute for any affected Mortgage Loan in accordance
herewith.
(c) In connection with the transfer and assignment set forth in
clause (b) above, the Depositor has delivered or caused to be delivered to the
Trustee (or, in the case of the Delay Delivery Mortgage Loans, will deliver or
cause to be delivered to the Trustee) within thirty (30) days following the
Closing Date for the benefit of the Certificateholders the following documents
or instruments with respect to each Mortgage Loan so assigned:
58
(i) (A) the original Mortgage Note endorsed by manual
or facsimile signature in blank in the following form: "Pay
to the order of ____________ without recourse," with all
intervening endorsements showing a complete chain of
endorsement from the originator to the Person endorsing the
Mortgage Note (each such endorsement being sufficient to
transfer all right, title and interest of the party so
endorsing, as noteholder or assignee thereof, in and to that
Mortgage Note); or
(B) with respect to any Lost Mortgage Note, a
lost note affidavit from Countrywide stating that the
original Mortgage Note was lost or destroyed, together with
a copy of such Mortgage Note;
(ii) except as provided below and for each Mortgage
Loan that is not a MERS Mortgage Loan, the original recorded
Mortgage or a copy of such Mortgage certified by Countrywide
as being a true and complete copy of the Mortgage (or, in
the case of a Mortgage for which the related Mortgaged
Property is located in the Commonwealth of Puerto Rico, a
true copy of the Mortgage certified as such by the
applicable notary) and in the case of each MERS Mortgage
Loan, the original Mortgage, noting the presence of the MIN
of the Mortgage Loans and either language indicating that
the Mortgage Loan is a MOM Loan if the Mortgage Loan is a
MOM Loan or if the Mortgage Loan was not a MOM Loan at
origination, the original Mortgage and the assignment
thereof to MERS, with evidence of recording indicated
thereon, or a copy of the Mortgage certified by the public
recording office in which such Mortgage has been recorded;
(iii) in the case of each Mortgage Loan that is not a
MERS Mortgage Loan, a duly executed assignment of the
Mortgage (which may be included in a blanket assignment or
assignments), together with, except as provided below, all
interim recorded assignments of such mortgage (each such
assignment, when duly and validly completed, to be in
recordable form and sufficient to effect the assignment of
and transfer to the assignee thereof, under the Mortgage to
which the assignment relates); provided that, if the related
Mortgage has not been returned from the applicable public
recording office, such assignment of the Mortgage may
exclude the information to be provided by the recording
office; provided, further, that such assignment of Mortgage
need not be delivered in the case of a Mortgage for which
the related Mortgaged Property is located in the
Commonwealth of Puerto Rico;
(iv) the original or copies of each assumption,
modification, written assurance or substitution agreement,
if any;
(v) except as provided below, the original or
duplicate original lender's title policy or a printout of
the electronic equivalent and all riders thereto; and
(vi) in the case of a Cooperative Loan, the originals
of the following documents or instruments:
(A) The Coop Shares, together with a stock power in
blank;
59
(B) The executed Security Agreement;
(C) The executed Proprietary Lease;
(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, (b) all interim recorded assignments or (c) the lender's title
policy (together with all riders thereto) satisfying the requirements of
clause (ii), (iii) or (v) above, respectively, concurrently with the execution
and delivery hereof because such document or documents have not been returned
from the applicable public recording office in the case of clause (ii) or
(iii) above, or because the title policy has not been delivered to either the
Master Servicer or the Depositor by the applicable title insurer in the case
of clause (v) above, the Depositor shall promptly deliver to the Trustee, in
the case of clause (ii) or (iii) above, such original Mortgage or such interim
assignment, as the case may be, with evidence of recording indicated thereon
upon receipt thereof from the public recording office, or a copy thereof,
certified, if appropriate, by the relevant recording office, but in no event
shall any such delivery of the original Mortgage and each such interim
assignment or a copy thereof, certified, if appropriate, by the relevant
recording office, be made later than one year following the Closing Date, or,
in the case of clause (v) above, no later than 120 days following the Closing
Date; provided, however, in the event the Depositor is unable to deliver by
such date each Mortgage and each such interim assignment by reason of the fact
that any such documents have not been returned by the appropriate recording
office, or, in the case of each such interim assignment, because the related
Mortgage has not been returned by the appropriate recording office, the
Depositor shall deliver such documents to the Trustee as promptly as possible
upon receipt thereof and, in any event, within 720 days following the Closing
Date. The Depositor
60
shall forward or cause to be forwarded to the Trustee (a) from time to time
additional original documents evidencing an assumption or modification of a
Mortgage Loan and (b) any other documents required to be delivered by the
Depositor or the Master Servicer to the Trustee. In the event that the
original Mortgage is not delivered and in connection with the payment in full
of the related Mortgage Loan and the public recording office requires the
presentation of a "lost instruments affidavit and indemnity" or any equivalent
document, because only a copy of the Mortgage can be delivered with the
instrument of satisfaction or reconveyance, the Master Servicer shall execute
and deliver or cause to be executed and delivered such a document to the
public recording office. In the case where a public recording office retains
the original recorded Mortgage or in the case where a Mortgage is lost after
recordation in a public recording office, Countrywide shall deliver to the
Trustee a copy of such Mortgage certified by such public recording office to
be a true and complete copy of the original recorded Mortgage.
As promptly as practicable subsequent to such transfer and
assignment, and in any event, within thirty (30) days thereafter, the Trustee
shall (i) as the assignee thereof, affix the following language to each
assignment of Mortgage: "CWALT Series 2005-24, 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
61
shall not apply to the initial delivery of the Mortgage File for such Delay
Delivery Mortgage Loan, but rather Countrywide (on its own behalf and on
behalf of Park Granada, Park Monaco and Park Sienna) shall have five (5)
Business Days to cure such failure to deliver. At the end of such thirty (30)
day period the Trustee shall send a Delay 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 clauses (50) and (51) 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 hereto 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
62
of the party so endorsing, as noteholder or assignee thereof, in and to that
Mortgage Note or (ii) any assignment is in recordable form or is sufficient to
effect the assignment of and transfer to 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.
63
(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 that 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.
64
(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. 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 hereof, if any, and any such substitution
pursuant to (i) above shall not be effected prior to the additional delivery
to the Trustee of a Request for Release substantially in the form of Exhibit N
and the Mortgage File for any such Substitute Mortgage Loan. The Seller
repurchasing a Mortgage Loan pursuant to this Section 2.03(c) shall promptly
reimburse the Master Servicer and the Trustee for any expenses reasonably
incurred by the Master Servicer or the Trustee in respect of enforcing the
remedies for such breach. With respect to the representations and warranties
described in this Section which are made to the best of a Seller's knowledge,
if it is discovered by either the Depositor, a Seller or the Trustee that the
substance of such representation and warranty is inaccurate and such
inaccuracy materially and adversely affects the value of the related Mortgage
Loan or the interests of the Certificateholders therein, notwithstanding that
Seller's lack of knowledge with respect to the substance of such
representation or warranty, such inaccuracy shall be deemed a breach of the
applicable representation or warranty. Any breach of a representation set
forth in clauses (45), (47), (48), (49), (50), (51), (52), (53), (54), (56),
(57), (58) or (59) of Schedule III-A with respect to a Mortgage Loan in Loan
Group 3 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 such substitution, the Substitute Mortgage Loan
or Loans shall be subject to the terms of this
65
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 Stated Principal
Balance of all Substitute Mortgage Loans sold to the Depositor by that Seller
as of the date of substitution is less than the aggregate Stated Principal
Balance of all Deleted Mortgage Loans repurchased by that Seller (after
application of the scheduled principal portion of the monthly payments due in
the month of substitution). The amount of such shortage (the "Substitution
Adjustment Amount") plus an amount equal to the aggregate of any unreimbursed
Advances with respect to such Deleted Mortgage Loans shall be deposited in the
Certificate Account by Countrywide (on its own behalf and on behalf of Park
Granada, Park Monaco and Park Sienna) on or before the Distribution Account
Deposit Date for the Distribution Date in the month succeeding the calendar
month during which the related Mortgage Loan became required to be purchased
or replaced hereunder.
In the event that a Seller shall have repurchased a Mortgage Loan,
the Purchase Price therefor shall be deposited in the Certificate Account
pursuant to Section 3.05 on or before the Distribution Account Deposit Date
for the Distribution Date in the month following the month during which that
Seller became obligated hereunder to repurchase or replace such Mortgage Loan
and upon such deposit of the Purchase Price, the delivery of the Opinion of
Counsel required by Section 2.05 and receipt of a Request for Release in the
form of Exhibit N hereto, the Trustee shall release the related Mortgage File
held for the benefit of the Certificateholders to such Person, and the Trustee
shall execute and deliver at such Person's direction such instruments of
transfer or assignment prepared by such Person, in each case without recourse,
as shall be necessary to transfer title from the Trustee. It is understood and
agreed that the obligation under this Agreement of any Person to cure,
repurchase or replace any Mortgage Loan as to which a breach has occurred and
is continuing shall constitute the sole remedy against such Persons respecting
such breach available to Certificateholders, the Depositor or the Trustee on
their behalf.
The representations and warranties made pursuant to this Section 2.03
shall survive delivery of the respective Mortgage Files to the Trustee for the
benefit of the Certificateholders.
SECTION 2.04. Representations and Warranties of the Depositor as to
the Mortgage Loans.
The Depositor hereby represents and warrants to the Trustee with
respect to each Mortgage Loan as of the date of this Agreement or such other
date set forth in this Agreement
66
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) hereof, 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.
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.
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 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
67
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 best of its ability, 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 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.
68
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.
69
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. Unless the context otherwise requires, references in this Agreement
to actions taken or to be taken by the Master Servicer in servicing the
Mortgage Loans include actions taken or to be taken by a Subservicer on behalf
of the Master Servicer. Notwithstanding the provisions of any subservicing
agreement, any of the provisions of this Agreement relating to agreements or
arrangements between the Master Servicer and a Subservicer or reference to
actions taken through a Subservicer or otherwise, the Master Servicer shall
remain obligated and liable to the Depositor, the Trustee and the
Certificateholders for the servicing and administration of the Mortgage Loans
in accordance with the provisions of this Agreement without diminution of such
obligation or liability by virtue of such subservicing agreements or
arrangements or by virtue of indemnification from the Subservicer and to the
same extent and under the same terms and conditions as if the Master Servicer
alone were servicing and administering the Mortgage Loans. All actions of each
Subservicer performed pursuant to the related subservicing agreement shall be
performed as an agent of the Master Servicer with the same force and effect as
if performed directly by the Master Servicer.
(b) For purposes of this Agreement, the Master Servicer shall be
deemed to have received any collections, recoveries or payments with respect
to the Mortgage Loans that are received by a Subservicer regardless of whether
such payments are remitted by the Subservicer to the Master Servicer.
SECTION 3.03. Rights of the Depositor and the Trustee in Respect of
the Master Servicer.
The Depositor may, but is not obligated to, enforce the obligations
of the Master Servicer 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. Neither the Trustee nor the Depositor shall have
any responsibility or liability for any action or failure to act by the Master
Servicer nor shall the Trustee or the Depositor be obligated to supervise the
performance of the Master Servicer under this Agreement or otherwise.
70
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), 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), 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; Capitalized Interest Account; Carryover
Shortfall 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 any prepayment charge or
penalty interest in connection with the prepayment of a Mortgage Loan and (ii)
extend the due dates for payments due on a Mortgage Note for a period not
greater than 180 days; provided, however, that the Master Servicer cannot
extend the maturity of any such Mortgage Loan past the date on which the final
payment is due on the latest maturing Mortgage Loan as of the Cut-off Date. In
the event of any such arrangement, the Master Servicer shall make Advances on
the related Mortgage Loan in accordance with the provisions of Section 4.01
during the scheduled period in accordance with the amortization schedule of
such Mortgage Loan without modification thereof by reason of such
arrangements. The Master Servicer shall not be required to institute or join
in litigation with respect to collection of any payment (whether under a
Mortgage, Mortgage Note or otherwise or against any public or governmental
authority with respect to a taking or condemnation) if it 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
71
receipt (or, if the current long-term credit rating of Countrywide is reduced
below "A-" by S&P or Fitch 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 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 pursuant to Section 3.05(e) in connection with any losses on
Permitted Investments;
(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; and
(viii) 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 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
72
Certificate Account. The Master Servicer shall maintain adequate records with
respect to all withdrawals made pursuant to this Section. All funds deposited
in the Certificate Account shall be held in trust for the Certificateholders
until withdrawn in accordance with Section 3.08.
(c) [Reserved].
(d) The Trustee shall establish and maintain, on behalf of the
Certificateholders, the Distribution Account. The Trustee shall, promptly upon
receipt, deposit in the Distribution Account and retain 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 pursuant to
Section 3.05(e) in connection with any losses on Permitted
Investments; 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.
(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
73
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 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 LIBOR Certificates
and the Class 1-A-X and Class 2-A-X Certificates, the Carryover Shortfall
Reserve Fund and shall deposit $1,000 therein upon receipt from or on behalf
of the Depositor of such amount. All funds on deposit in the Carryover
Shortfall Reserve Fund shall (x) 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 and (y) remain
uninvested.
On each Distribution Date, the Trustee shall deposit into the
Carryover Shortfall Reserve Fund all amounts otherwise distributable to the
Class 1-A-X IO-1, Class 1-A-X IO-2 and Class 2-A-X IO-1 and Class 2-A-X IO-2
Components on such Distribution Date. On each Distribution Date, the Trustee
shall also deposit into the Carryover Shortfall Reserve Fund all amounts
received in respect of the Corridor Contract for the related Interest Accrual
Period.
The Trustee shall make withdrawals from the Carryover Shortfall
Reserve Fund to make distributions pursuant to Section 4.02(a)(8). Upon the
earlier of (i) the retirement of the LIBOR Certificates and (ii) the
termination of the Trust Fund in accordance with Section 9.01, the Trustee
shall distribute to the Depositor all monies remaining on deposit in the
Carryover Shortfall Reserve Fund after making the distributions specified in
Section 4.02(a)(8).
(h) On the Closing Date, the Trustee shall establish and maintain in
its name, in trust for the benefit of the Holders of the Certificates, the
Capitalized Interest Account and shall deposit $2,861,759.77 therein upon
receipt from or on behalf of the Depositor of such amount. All funds on
deposit in the Capitalized Interest Account shall (x) 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 and (y) remain uninvested. The Capitalized Interest Account shall
consist of four subaccounts, each of which relates to a Loan Group, and the
Trustee shall deposit (i) $648,408.69 into the subaccount related to Loan
Group 1, (ii) $491,292.61 into the subaccount related to Loan Group 2, (iii)
$520,600.47 into the subaccount related to Loan Group 3, and (iv)
$1,201,458.00 into the subaccount related to Loan Group 4.
On the first Distribution Date, the Trustee shall deposit all amounts
on deposit in the Capitalized Interest Account into the Distribution Account
to be included in the Available Funds for the related Loan Group and
distributed to the Certificates.
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
74
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 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 or Certificate Owner that 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 or Certificate Owner to comply
with applicable regulations of the OTS or other regulatory authorities with
respect to investment in the Certificates; provided that the Master Servicer
shall be entitled to be reimbursed by each such Certificateholder or
Certificate Owner for actual expenses incurred by the Master Servicer in
providing such reports and access.
SECTION 3.08. Permitted Withdrawals from the Certificate Account; the
Distribution Account and the Carryover Shortfall Reserve Fund.
(a) The Master Servicer may from time to time make withdrawals from
the Certificate Account for the following purposes:
75
(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 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;
(ix) on or prior to the Distribution Account Deposit Date,
to withdraw an amount equal to the related Available Funds 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.
76
(b) The Trustee shall withdraw funds from the Distribution Account
for distributions to Certificateholders in the manner specified in this
Agreement (and to withhold from the amounts so withdrawn, the amount of any
taxes that it is authorized to withhold pursuant to the second to last
paragraph of Section 8.11). In addition, the Trustee may from time to time
make withdrawals from the Distribution Account for the following purposes:
(i) 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 the 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 Shortfall
Reserve Fund for distribution to the LIBOR Certificates and the Class X
Certificates in the manner specified in Section 4.02(a)(8) (and to withhold
from the amounts so withdrawn the amount of any taxes that it is authorized to
retain pursuant to the last paragraph of Section 8.11). In addition, the
Trustee may from time to time make withdrawals from the Carryover Shortfall
Reserve Fund for the following purposes:
(i) to withdraw any amount deposited in the Carryover
Shortfall Reserve Fund and not required to be deposited therein; and
(ii) to clear and terminate the Carryover Shortfall Reserve
Fund upon the retirement of LIBOR Certificates and the Class X
Certificates pursuant to Section 9.01.
(d) On the first Distribution Date, the Trustee shall withdraw funds
from the Capitalized Interest Account for addition to the Available Funds in
the Distribution Account. In addition, the Trustee may from time to time make
withdrawals from the Capitalized Interest Account for the following purposes:
(i) to withdraw any amount deposited in the Capitalized
Interest Account and not required to be deposited therein; and
77
(ii) to clear and terminate the Capitalized Interest Account
upon the earlier of (i) the second Distribution Date and (ii) the
termination of this Agreement pursuant to Section 9.01.
SECTION 3.09. Maintenance of Hazard Insurance; Maintenance of Primary
Insurance Policies.
(a) The Master Servicer shall cause to be maintained, for each
Mortgage Loan, hazard insurance with extended coverage in an amount that is at
least equal to the lesser of (i) the maximum insurable value of the
improvements securing such Mortgage Loan or (ii) the greater of (y) the
outstanding principal balance of the Mortgage Loan, including, with respect to
any Negative Amortization Mortgage Loan, any Deferred Interest, 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 liquidation
proceeds 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) 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
78
appraised value or (ii) if maintaining such Primary Insurance Policy is
prohibited by applicable law. With respect to the Lender PMI Mortgage Loans,
the Master Servicer shall maintain the Primary Insurance Policy for the life
of such Mortgage Loans, unless otherwise provided for in the related Mortgage
Note or prohibited by law.
The Master Servicer agrees to effect the timely payment of the
premiums on each Primary Insurance Policy, and such costs not otherwise
recoverable shall be recoverable by the Master Servicer from the related
liquidation proceeds and Subsequent Recoveries.
(c) In connection with its activities as Master Servicer of the
Mortgage Loans, the Master Servicer agrees to present on behalf of itself, the
Trustee and Certificateholders, claims to the insurer under any Primary
Insurance Policies and, in this regard, to take such reasonable action as
shall be necessary to permit recovery under any Primary Insurance Policies
respecting defaulted Mortgage Loans. Any amounts collected by the Master
Servicer under any Primary Insurance Policies shall be deposited in the
Certificate Account.
SECTION 3.10. Enforcement of Due-on-Sale Clauses; Assumption
Agreements.
(a) Except as otherwise provided in this Section, when any property
subject to a Mortgage has been conveyed by the Mortgagor, the Master Servicer
shall to the extent that it has knowledge of such conveyance, enforce any
due-on-sale clause contained in any Mortgage Note or Mortgage, to the extent
permitted under applicable law and governmental regulations, but only to the
extent that such enforcement will not adversely affect or jeopardize coverage
under any Required Insurance Policy. Notwithstanding the foregoing, the Master
Servicer is not required to exercise such rights with respect to a Mortgage
Loan if the Person to whom the related Mortgaged Property has been conveyed or
is proposed to be conveyed satisfies the terms and conditions contained in the
Mortgage Note and Mortgage related thereto and the consent of the mortgagee
under such Mortgage Note or Mortgage is not otherwise so required under such
Mortgage Note or Mortgage as a condition to such transfer. In the event that
the Master Servicer is prohibited by law from enforcing any such due-on-sale
clause, or if coverage under any Required Insurance Policy would be adversely
affected, or if nonenforcement is otherwise permitted hereunder, the Master
Servicer is authorized, subject to Section 3.10(b), to take or enter into an
assumption and modification agreement from or with the person to whom such
property has been or is about to be conveyed, pursuant to which such person
becomes liable under the Mortgage Note and, unless prohibited by applicable
state law, the Mortgagor remains liable thereon, provided that the Mortgage
Loan shall continue to be covered (if so covered before the Master Servicer
enters such agreement) by the applicable Required Insurance Policies. The
Master Servicer, subject to Section 3.10(b), is also authorized with the prior
approval of the insurers under any Required Insurance Policies to enter into a
substitution of liability agreement with such Person, pursuant to which the
original Mortgagor is released from liability and such Person is substituted
as Mortgagor and becomes liable under the Mortgage Note. Notwithstanding the
foregoing, the Master Servicer shall not be deemed to be in default under this
Section by reason of any transfer or assumption which the Master Servicer
reasonably believes it is restricted by law from preventing, for any reason
whatsoever.
(b) Subject to the Master Servicer's duty to enforce any due-on-sale
clause to the extent set forth in Section 3.10(a), 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
79
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 to itself of such expenses and (ii) that
such expenses will be recoverable to it through Liquidation Proceeds 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 of
such costs and expenses from the liquidation proceeds and Subsequent
Recoveries with respect to the related Mortgaged Property, as provided in the
definition of Liquidation Proceeds. If the Master Servicer has knowledge that
a Mortgaged Property which the Master Servicer is contemplating acquiring in
foreclosure or by deed in lieu of foreclosure is located within a one-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
80
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
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.
81
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 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 end of the Due Period concluding 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 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 that 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 that 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
82
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, (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 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
83
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.
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
84
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 for each
Aggregate Loan Group, if any, with respect to such Distribution Date, but not
to exceed the related Compensating Interest for each Aggregate Loan Group for
such 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 penalties, 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.
SECTION 3.15. Access to Certain Documentation.
The Master Servicer shall provide to the OTS and the FDIC and to
comparable regulatory authorities supervising Certificateholders 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.
The Master Servicer acknowledges that as part of its servicing
activities, the Master Servicer shall fully furnish, 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 related to the Mortgage Loans in Loan Group 3 to Equifax, Experian and
85
Trans Union Credit Information Company (three of the nationally recognized
credit bureaus) on a monthly basis.
SECTION 3.16. Annual Statement as to Compliance.
The Master Servicer shall deliver to the Depositor and the Trustee on
or before 80 days after the end of the Master Servicer's fiscal year,
commencing with its 2005 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 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
throughout such year, or, if there has been a default in the fulfillment of
any such obligation, specifying each such default known to such officer and
the nature and status thereof. The Trustee shall forward a copy of each such
statement to each Rating Agency.
SECTION 3.17. Annual Independent Public Accountants' Servicing
Statement; Financial Statements.
On or before 80 days after the end of the Master Servicer's fiscal
year, commencing with its 2005 fiscal year, the Master Servicer at its expense
shall cause a nationally or regionally recognized firm of independent public
accountants (who may also render other services to the Master Servicer, a
Seller or any affiliate thereof) which is a member of the American Institute
of Certified Public Accountants to furnish a statement to the Trustee and the
Depositor to the effect that such firm has examined certain documents and
records relating to the servicing of the Mortgage Loans under this Agreement
or of mortgage loans under pooling and servicing agreements substantially
similar to this Agreement (such statement to have attached thereto a schedule
setting forth the pooling and servicing agreements covered thereby) and that,
on the basis of such examination, conducted substantially in compliance with
the Uniform Single Attestation Program for Mortgage Bankers or the Audit
Program for Mortgages serviced for FNMA and FHLMC, such servicing has been
conducted in compliance with such pooling and servicing agreements except for
such significant exceptions or errors in records that, in the opinion of such
firm, the Uniform Single Attestation Program for Mortgage Bankers or the Audit
Program for Mortgages serviced for FNMA and FHLMC requires it to report. In
rendering such statement, such firm may rely, as to matters relating to direct
servicing of mortgage loans by Subservicers, upon comparable statements for
examinations conducted substantially in compliance with the Uniform Single
Attestation Program for Mortgage Bankers or the Audit Program for Mortgages
serviced for FNMA and FHLMC (rendered within one year of such statement) of
independent public accountants with respect to the related Subservicer. Copies
of such statement shall be provided by the Trustee to any Certificateholder
upon request at the Master Servicer's expense, provided that such statement is
delivered by the Master Servicer to the Trustee.
SECTION 3.18. 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 the performance of its obligations
as Master Servicer hereunder and (b) a fidelity bond in respect
86
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 3.19. Notification of Adjustments.
On each Adjustment Date, the Master Servicer shall make interest rate
and/or monthly payment 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 and/or monthly payment adjustments. The Master
Servicer also shall provide timely notification to the Trustee of all
applicable data and information regarding such interest rate or monthly
payment adjustments and the Master Servicer's methods of implementing such
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 and/or principal loss
caused thereby without reimbursement therefor; provided, however, the Master
Servicer shall be held harmless with respect to any interest rate and/or
monthly payment adjustments made by any servicer prior to the Master Servicer.
SECTION 3.20. The Corridor Contracts
Countrywide shall cause The Bank of New York to enter into the
Corridor Contract Administration Agreement and shall assign all of its right,
title and interest in and to the interest rate corridor transactions evidenced
by the Corridor Contract to, and shall cause all of its obligations in respect
of such transactions to be assumed by, the Corridor Contract Administrator, on
the terms and conditions set forth in the Corridor Contract Assignment
Agreement. The Trustee's rights to receive certain proceeds of the Corridor
Contract as provided in the Corridor Contract Administration Agreement will be
assets of the Trust Fund but will not be assets of any REMIC. The Trustee
shall deposit any amounts received from time to time with respect to the
Corridor Contract into the Carryover Shortfall Reserve Fund. The Master
Servicer shall deposit any amounts received on behalf of the Trustee from time
to time with respect to the Corridor Contract into the Carryover Shortfall
Reserve Fund.
No later than two Business Days following each Distribution Date, the
Trustee shall provide the Corridor Contract Administrator with information
regarding the aggregate Class Certificate Balance of the Class(es) of
Certificates related to the Corridor Contract after all distributions on such
Distribution Date.
The Corridor Contract Administrator shall, upon receipt of direction
from Countrywide, terminate the Corridor Contract upon the occurrence of
certain events of default or termination events to the extent specified
thereunder. Upon any such termination, the applicable Corridor Contract
Counterparty will be obligated to pay the Corridor Contract Administrator an
amount in respect of such termination, and the portion of such amount that is
distributable to the Trust Fund pursuant to the Corridor Contract
Administration Agreement and received by the Trustee or the
87
Master Servicer for the benefit of the Trust Fund, as the case may be, in
respect of such termination shall be deposited and held in the Carryover
Shortfall Reserve Fund and applied on future Distribution Dates to pay any
related Yield Supplement Amount on the LIBOR Certificates (other than the
Class 3-A-1 Certificates).
88
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), the Master Servicer 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 will not be
deposited by the Master Servicer (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.
89
(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) (1) With respect to the Available Funds for Loan Group 1, on each
Distribution Date, the Trustee shall withdraw such Available Funds from the
Distribution Account and apply such funds to distributions on the specified
Classes of Group 1 Senior Certificates in the following order and priority
and, in each case, to the extent of such funds remaining:
(i) [Reserved];
(ii) concurrently, to each interest-bearing Class of Group 1
Senior Certificates and the Class 1-A-X IO-1 and Class 1-A-X IO-2
Components, an amount allocable to interest equal to the related
Class Optimal Interest Distribution Amount for such Distribution
Date, any shortfall being allocated among such Classes and Components
in proportion to the amount of the Class Optimal Interest
Distribution Amount that would have been distributed in the absence
of such shortfall;
(iii) [Reserved];
(iv) to each Class of Group 1 Senior Certificates and the
Class 1-A-X PO Component, concurrently as follows:
(x) [Reserved]; and
(y) the related Principal Amount, up to the amount
of the Senior Principal Distribution Amount for Loan Group 1
for such Distribution Date will be distributed,
sequentially;
(A) to the Class A-R Certificates, until
its Class Certificate Balance is reduced to zero;
and
(B) concurrently, to the Class 1-A-1 and
Class 1-A-2 Certificates and the Class 1-A-X PO
Component, pro rata, until their respective Class
Certificate Balances or Component Principal
Balance, as applicable, are reduced to zero.
(2) With respect to the Available Funds for Loan Group 2, on each
Distribution Date, the Trustee shall withdraw such Available Funds from the
Distribution Account and apply such funds to distributions on the specified
Classes of Group 2 Senior Certificates in the following order and priority
and, in each case, to the extent of such funds remaining:
90
(i) [Reserved];
(ii) concurrently, to each interest-bearing Class of Group 2
Senior Certificates and the Class 2-A-X IO-1 and Class 2-A-X IO-2
Components, an amount allocable to interest equal to the related
Class Optimal Interest Distribution Amount for such Distribution
Date, any shortfall being allocated among such Classes and Components
in proportion to the amount of the Class Optimal Interest
Distribution Amount that would have been distributed in the absence
of such shortfall;
(iii) [Reserved];
(iv) to each Class of Group 2 Senior Certificates and the
Class 2-A-X PO Component, concurrently, as follows:
(x) [Reserved]; and
(y) the related Principal Amount, up to the amount
of the Senior Principal Distribution Amount for Loan Group 2
for such Distribution Date will be distributed,
concurrently, to the Class 2-A-1A, Class 2-A-1B and Class
2-A-1C Certificates and the Class 2-A-X PO Component, pro
rata, until their respective Class Certificate Balances or
Component Principal Balance, as applicable, are reduced to
zero.
(3) With respect to the Available Funds for Loan Group 3, on each
Distribution Date, the Trustee shall withdraw such Available Funds from the
Distribution Account and apply such funds to distributions on the specified
Classes of Group 3 Senior Certificates in the following order and priority
and, in each case, to the extent of such funds remaining:
(i) [Reserved];
(ii) concurrently, to each interest-bearing Class of Group 3
Senior Certificates and the Class 3-A-X IO-1 and Class 3-A-X IO-2
Components, an amount allocable to interest equal to the related
Class Optimal Interest Distribution Amount for such Distribution
Date, any shortfall being allocated among such Classes and Components
in proportion to the amount of the Class Optimal Interest
Distribution Amount that would have been distributed in the absence
of such shortfall; provided, however, that the amount of interest
otherwise distributable to the Class 3-A-X IO and Class 3-A-X IO-2
Components shall be deposited into the Carryover Shortfall Reserve
Fund and shall be distributed in accordance with Section 4.02(a)(8);
(iii) [Reserved];
(iv) to each Class of Group 3 Senior Certificates and the
Class 3-A-X PO Component, concurrently as follows:
(x) [Reserved]; and
(y) the related Principal Amount, up to the amount
of the Senior Principal Distribution Amount for Loan Group 3
for such Distribution Date will be
91
distributed, concurrently, to the Class 3-A-1 and Class
3-A-2 Certificates and the Class 3-A-X PO Component, pro
rata, until their respective Class Certificate Balances or
Component Principal Balance, as applicable, are reduced to
zero.
(4) With respect to the Available Funds for Loan Group 4, on each
Distribution Date, the Trustee shall withdraw such Available Funds from the
Distribution Account and apply such funds to distributions on the specified
Classes of Group 4 Senior Certificates in the following order and priority
and, in each case, to the extent of such funds remaining:
(i) [Reserved];
(ii) concurrently, to each interest-bearing Class of Group 4
Senior Certificates and the Class 4-A-X IO-1 and Class 4-A-X IO-2
Components, an amount allocable to interest equal to the related
Class Optimal Interest Distribution Amount for such Distribution
Date, any shortfall being allocated among such Classes and Components
in proportion to the amount of the Class Optimal Interest
Distribution Amount that would have been distributed in the absence
of such shortfall; provided, however, that the amount of interest
otherwise distributable to the Class 4-A-X IO and Class 4-A-X IO-2
Components shall be deposited into the Carryover Shortfall Reserve
Fund and shall be distributed in accordance with Section 4.02(a)(8);
(iii) [Reserved];
(iv) to each Class of Group 4 Senior Certificates and the
Class 4-A-X PO Component, concurrently as follows:
(x) [Reserved]; and
(y) the related Principal Amount, up to the amount
of the Senior Principal Distribution Amount for Loan Group 4
for such Distribution Date will be distributed,
concurrently, to the Class 4-A-1 and Class 4-A-2
Certificates and the Class 4-A-X PO Component, pro rata,
until their respective Class Certificate Balances or
Component Principal Balance, as applicable, are reduced to
zero.
(5) On each Distribution Date, Available Funds from each Loan Group
in an Aggregate Loan Group remaining after making the distributions described
in Section 4.02(a)(1) through Section 4.02(a)(4) above, shall be distributed
to each Class and Component of the related Senior Certificates to the extent
provided in Section 4.05 hereof.
(6) On each Distribution Date, Available Funds from Loan Group 1 and
2 remaining after making the distributions described in Section 4.02(a)(1),
Section 4.02(a)(2) and Section 4.02(a)(5) above, shall be distributed to the
Group I Subordinated Certificates and the Class A-R Certificates in the
following order and priority and, in each case, to the extent of such funds
remaining:
(A) to the Class I-M Certificates, an amount
allocable to interest equal to the Class Optimal Interest
Distribution Amount for such Class for such Distribution
Date;
92
(B) to the Class I-M Certificates, an amount
allocable to principal equal to its Pro Rata Share for such
Distribution Date until the Class Certificate Balance
thereof is reduced to zero;
(C) to the Class I-B-1 Certificates, an amount
allocable to interest equal to the Class Optimal Interest
Distribution Amount for such Class for such Distribution
Date;
(D) to the Class I-B-1 Certificates, an amount
allocable to principal equal to its Pro Rata Share for such
Distribution Date until the Class Certificate Balance
thereof is reduced to zero;
(E) to the Class I-B-2 Certificates, an amount
allocable to interest equal to the Class Optimal Interest
Distribution Amount for such Class for such Distribution
Date;
(F) to the Class I-B-2 Certificates, an amount
allocable to principal equal to its Pro Rata Share for such
Distribution Date until the Class Certificate Balance
thereof is reduced to zero;
(G) to the Class I-B-3 Certificates, an amount
allocable to interest equal to the Class Optimal Interest
Distribution Amount for such Class for such Distribution
Date;
(H) to the Class I-B-3 Certificates, an amount
allocable to principal equal to its Pro Rata Share for such
Distribution Date until the Class Certificate Balance
thereof is reduced to zero;
(I) to the Class I-B-4 Certificates, an amount
allocable to interest equal to the Class Optimal Interest
Distribution Amount for such Class for such Distribution
Date;
(J) to the Class I-B-4 Certificates, an amount
allocable to principal equal to its Pro Rata Share for such
Distribution Date until the Class Certificate Balance
thereof is reduced to zero;
(K) to the Class I-B-5 Certificates, an amount
allocable to interest equal to the Class Optimal Interest
Distribution Amount for such Class for such Distribution
Date;
(L) to the Class I-B-5 Certificates, an amount
allocable to principal equal to its Pro Rata Share for such
Distribution Date until the Class Certificate Balance
thereof is reduced to zero; and
(M) to the Class A-R Certificates, any remaining
funds related to Aggregate Loan Group I.
(7) On each Distribution Date, Available Funds from Loan Groups 3 and
4 remaining after making the distributions described in Section 4.02(a)(3),
Section 4.02(a)(4) and Section
93
4.02(a)(5) above, shall be distributed to the Group II Subordinated
Certificates and the Class A-R Certificates in the following order and
priority and, in each case, to the extent of such funds remaining:
(A) to the Class II-M Certificates, an amount
allocable to interest equal to the Class Optimal Interest
Distribution Amount for such Class for such Distribution
Date;
(B) to the Class II-M Certificates, an amount
allocable to principal equal to its Pro Rata Share for such
Distribution Date until the Class Certificate Balance
thereof is reduced to zero;
(C) to the Class II-B-1 Certificates, an amount
allocable to interest equal to the Class Optimal Interest
Distribution Amount for such Class for such Distribution
Date;
(D) to the Class II-B-1 Certificates, an amount
allocable to principal equal to its Pro Rata Share for such
Distribution Date until the Class Certificate Balance
thereof is reduced to zero;
(E) to the Class II-B-2 Certificates, an amount
allocable to interest equal to the Class Optimal Interest
Distribution Amount for such Class for such Distribution
Date;
(F) to the Class II-B-2 Certificates, an amount
allocable to principal equal to its Pro Rata Share for such
Distribution Date until the Class Certificate Balance
thereof is reduced to zero;
(G) to the Class II-B-3 Certificates, an amount
allocable to interest equal to the Class Optimal Interest
Distribution Amount for such Class for such Distribution
Date;
(H) to the Class II-B-3 Certificates, an amount
allocable to principal equal to its Pro Rata Share for such
Distribution Date until the Class Certificate Balance
thereof is reduced to zero;
(I) to the Class II-B-4 Certificates, an amount
allocable to interest equal to the Class Optimal Interest
Distribution Amount for such Class for such Distribution
Date; and
(J) to the Class II-B-4 Certificates, an amount
allocable to principal equal to its Pro Rata Share for such
Distribution Date until the Class Certificate Balance
thereof is reduced to zero;
(K) to the Class II-B-5 Certificates, an amount
allocable to interest equal to the Class Optimal Interest
Distribution Amount for such Class for such Distribution
Date;
94
(L) to the Class II-B-5 Certificates, an amount
allocable to principal equal to its Pro Rata Share for such
Distribution Date until the Class Certificate Balance
thereof is reduced to zero; and
(M) to the Class A-R Certificates, any remaining
funds related to Aggregate Loan Group II.
(8) On each Distribution Date, any amounts deposited in the Carryover
Shortfall Reserve Fund pursuant to Sections 4.02(a)(3)(ii) and Section
4.02(a)(4)(ii) and from amounts received by the Trustee in respect of the
Corridor Contract shall be distributed as follows:
(i) on each Distribution Date on or prior to the earlier of
(i) the Corridor Contract Scheduled Termination Date and (ii) the
date on which the aggregate Class Certificate Balance of the LIBOR
Certificates (other than the Class 3-A-1 Certificates) is reduced to
zero, the Trustee shall (a) withdraw from the Carryover Shortfall
Reserve Fund the lesser of the Yield Supplement Amount and the
amount actually deposited in the Carryover Shortfall Reserve Fund by
the Corridor Contract Administrator for such Distribution Date and
(b) distribute such amount, concurrently, to the LIBOR Certificates
(other than the Class 3-A-1 Certificates), proportionately based on
the Carryover Shortfall Amount with respect to each such Class of
Certificates for that Distribution Date, up to the amount of any
Carryover Shortfall Amount with respect to each such Class of
Certificates for that Distribution Date.
(ii) from amounts otherwise distributable to the Class 3-A-X
IO-1 Component, sequentially, as follows:
(A) first, to the Class 3-A-1 and Class 3-A-2
Certificates, in an amount up to such Class' Carryover
Shortfall Amount for such Distribution Date; and
(B) second, to the Class II-A-X Certificates;
(iii) from amounts otherwise distributable to the Class
4-A-X IO-1 Component, sequentially, as follows:
(A) first, to the Class 4-A-1, Class 4-A-2 and
Class 4-A-3 Certificates, in an amount up to such Class'
Carryover Shortfall Amount for such Distribution Date; and
(B) second, to the Class II-A-X Certificates; and
(iv) from amounts otherwise distributable to the Class 3-A-X
IO-2 and Class 4-A-X IO-2 Components, sequentially, as follows:
(A) first, concurrently, to the Class II-M, Class
II-B-1, Class II-B-2 Certificates, pro rata, based on such
Class' entitlements to receive Carryover Shortfall Amounts
on such Distribution Date, in an amount up to their
respective Carryover Shortfall Amounts for such Distribution
Date;
95
(B) second, sequentially, to the Class II-B-3,
Class II-B-4 and Class II-B-5 Certificates, in that order,
in each case up to the amount of such Class' Carryover
Shortfall Amounts for such Distribution Date; and
(C) third, to the Class II-A-X Certificates.
(b) [Reserved].
(c) [Reserved].
(d) On each Distribution Date, the amount referred to in clause (i)
of the definition of Class Optimal Interest Distribution Amount for each Class
of Certificates or Component thereof for such Distribution Date shall be
reduced for each Class or Component of Senior Certificates of a Senior
Certificate Group and each related Class of Subordinated Certificates by (i)
the related Class' pro rata share of the Net Prepayment Interest Shortfalls
for the related Loan Group based (x) with respect to a Class of Senior
Certificates or Component thereof, on the related Class Optimal Interest
Distribution Amount for such Distribution Date, and (y) (1) with respect to
the Group I Subordinated Certificates on and prior to the first related Senior
Termination Date on the Assumed Interest Amount or after such Senior
Termination Date, the related Class Optimal Interest Distribution Amount for
such Distribution Date in the absence of such Net Prepayment Interest
Shortfalls and (2) with respect to the Group II Subordinated Certificates on
and prior to the first related Senior Termination Date on the Assumed Interest
Amount or after such Senior Termination Date, the related Class Optimal
Interest Distribution Amount for such Distribution Date in the absence of such
Net Prepayment Interest Shortfalls, and (ii) the related Class' Allocable
Share of (A) with respect to each Mortgage Loan in the related Loan Group that
became subject to a Debt Service Reduction during the calendar month preceding
the month of such Distribution Date, the interest portion of the related Debt
Service Reduction and (B) each Relief Act Reduction for the Mortgage Loans in
the related Loan Group incurred during the calendar month preceding the month
of such Distribution Date.
(e) Notwithstanding the priority and allocation contained in Section
4.02(a)(6), if, on any Distribution Date, with respect to any Class of Group I
Subordinated Certificates (other than the Class of Group I Subordinated
Certificates then outstanding with the highest priority of distribution), the
sum of the related Class Subordination Percentages of such Class and of all
Classes of Group I Subordinated Certificates which have a higher numerical
Class designation than such Class (the "Applicable Credit Support Percentage")
is less than the Original Applicable Credit Support Percentage for such Class,
no distribution of Net Prepayments will be made to any such Classes (the
"Restricted Classes") and the amount of such Net Prepayments otherwise
distributable to the Restricted Classes shall be distributed to any Classes of
Group I Subordinated Certificates having lower numerical Class designations
than such Class, pro rata, based on their respective Class Certificate
Balances immediately prior to such Distribution Date and shall be distributed
in the sequential order provided in Section 4.02(a)(6). Notwithstanding
anything in this Agreement to the contrary, the Class of Group I Subordinated
Certificates then outstanding with the highest distribution priority shall not
be a Restricted Class.
Notwithstanding the priority and allocation contained in
Section 4.02(a)(7), if, on any Distribution Date, with respect to any Class of
Group II Subordinated Certificates (other than the Class of Group II
Subordinated Certificates then outstanding with the highest priority of
96
distribution), the Applicable Credit Support Percentage for a Class of Group
II Subordinated Certificates is less than the Original Applicable Credit
Support Percentage for such Class, no distribution Principal Prepayments will
be made to any such Classes (the "Restricted Classes") and the amount of such
Principal Prepayments otherwise distributable to the Restricted Classes shall
be distributed to any Classes of Group II Subordinated Certificates having
lower numerical Class designations than such Class, pro rata, based on their
respective Class Certificate Balances immediately prior to such Distribution
Date and shall be distributed in the sequential order provided in Section
4.02(a)(7). Notwithstanding anything in this Agreement to the contrary, the
Class of Group II Subordinated Certificates then outstanding with the highest
distribution priority shall not be a Restricted Class.
(f) If Subsequent Recoveries have been received with respect to a
Liquidated Mortgage Loan in an Aggregate Loan Group, the amount of such
Subsequent Recoveries will be applied sequentially, in the order of payment
priority, to increase the Class Certificate Balance or Component Principal
Balance of each Class of Certificates or Component thereof related to that
Aggregate Loan Group to which Realized Losses have been allocated, but in each
case by not more than the amount of Realized Losses previously allocated to
that Class of Certificates or Component pursuant to Section 4.04. Holders of
such Certificates will not be entitled to any payment in respect of the Class
Optimal Interest Distribution Amount 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 or Component Balance of each Certificate of such Class or Component
thereof.
SECTION 4.03. Allocation of Net Deferred Interest.
(a) For any Distribution Date, Net Deferred Interest on the Mortgage
Loans in a Loan Group will be allocated to the related Certificates in an
amount equal to the excess, if any, of (i) the amount of interest that accrued
on such Class of Certificates or its related Notional Amount Components at its
respective Pass-Through Rate during the Interest Accrual Period related to
that Distribution Date over (ii) the amount of interest that accrued on such
Class of Certificates or its related Notional Amount Components at the related
Adjusted Cap Rate during the Interest Accrual Period related to that
Distribution Date.
(b) Any Net Deferred Interest allocated to a Class of Certificates
will be added to the Class of Certificate Balance of such Class of
Certificates, except that in the case of the Class X Certificates, the amount
of Net Deferred Interest allocated to a Notional Amount Component shall be
added to the Component Principal Balance of the Principal Only Component of
that Class of Certificates.
SECTION 4.04. Allocation of Realized Losses.
(a) On or prior to each Determination Date, the Trustee shall
determine the total amount of Realized Losses, with respect to the related
Distribution Date.
Realized Losses with respect to any Distribution Date shall be
allocated as follows:
(i) [Reserved];
97
(ii) Any Realized Loss on the Mortgage Loans in a Loan Group
in Aggregate Loan Group I and Aggregate Loan Group II shall be
allocated first, to the Group I or Group II Subordinated
Certificates, as applicable, in reverse order of their respective
numerical Class designations (beginning with the Class of Group I or
Group II Subordinated Certificates then outstanding with the highest
numerical Class designation) until the respective Class Certificate
Balance of each such Class is reduced to zero, and second, to the
Senior Certificates of the related Senior Certificate Group (other
than any Notional Amount Certificates, if applicable), pro rata, on
the basis of their respective Class Certificate Balances immediately
prior to the related Distribution Date until the respective Class
Certificate Balance of each such Class is reduced to zero; provided,
however, (i) any Realized Losses in Loan Group 1 that would otherwise
be allocated to the Class 1-A-1 Certificates will instead be
allocated to the Class 1-A-2 Certificates until its Class Certificate
Balances is reduced to zero; (ii) any Realized Losses in Loan Group 2
that would otherwise be allocated to the Class 2-A-1A, Class 2-A-1B
and Class 2-A-1C Certificates will be allocated first to the Class
2-A-2 Certificates until its Class Certificate Balance is reduced to
zero, and any Realized Losses in Loan Group 2 that would otherwise be
allocated to the Class 2-A-1B Certificates will be allocated to the
Class 2-A-1C Certificates until its Class Certificate Balance is
reduced to zero; (iii) any Realized Losses in Loan Group 3 and Loan
Group 4 that would otherwise be allocated to the Class 3-A-1 and
Class 4-A-2 Certificates, respectively, will instead be allocated to
the Class 3-A-2 and Class 4-A-3 Certificates, respectively, until
their respective Class Certificate Balances are reduced to zero; and
(iv) any Realized Losses in Loan Group 4 that would otherwise be
allocated to the Class 4-A-1 Certificates will instead be allocated
first to the Class 4-A-3 Certificates until its Class Certificate
Balance is reduced to zero and then to the Class 4-A-2 Certificates
until its Class Certificate Balance is reduced to zero. For purposes
of allocating losses to the Group I Subordinated Certificates and
Group II Subordinated Certificates, the Class I-M Certificates and
Class II-M Certificates, respectively, will be considered to have a
lower numerical class designation than each other class of Group I
Subordinated Certificates and Group II Subordinated Certificates,
respectively.
(b) The Class Certificate Balance of the Class of Group I
Subordinated Certificates and Group II Subordinated Certificates, as
applicable, then outstanding with the highest numerical Class designation
shall be reduced on each Distribution Date by the amount, if any, by which the
aggregate Class Certificate Balance of all outstanding Classes of Group I
Certificates or Group II Certificates, as applicable, (after giving effect to
the distribution of principal and the allocation of Realized Losses on such
Distribution Date) exceeds the Pool Stated Principal Balance of the applicable
Aggregate Loan Group as of the last day of the Due Period related to such
Distribution Date.
(c) Any Realized Loss allocated to a Class of Certificates or any
reduction in the Class Certificate Balance of a Class of Certificates pursuant
to Section 4.04(b) above shall be allocated among the Certificates of such
Class in proportion to their respective Certificate Balances.
(d) Any allocation of Realized Losses to a Certificate or to any
Component or any reduction in the Certificate Balance of a Certificate,
pursuant to Section 4.04(b) above shall be accomplished by reducing the
Certificate Balance, Component Balance or Subordinated Portion thereof, as
applicable, immediately following the distributions made on the related
Distribution
98
Date in accordance with the definition of "Certificate Balance", "Component
Balance," or "Subordinated Portion," as the case may be.
SECTION 4.05. Cross-Collateralization; Adjustments to Available Funds
(a) If on any Distribution Date the aggregate Class Certificate
Balance of the Senior Certificates in a Senior Certificate Group related to a
Loan Group in Aggregate Loan Group I is greater than the aggregate Stated
Principal Balance of the Mortgage Loans in that Loan Group as of the first day
of the related Due Period (the "Undercollateralized Group"), then the Trustee
shall reduce the Available Funds of the other related Loan Groups in Aggregate
Loan Group I that are not undercollateralized (the "Overcollateralized
Groups"), as follows:
(1) to add to the Available Funds of each Undercollateralized Group
in Aggregate Loan Group I an amount equal to the lesser of (a) one
month's interest on the Transfer Payment of each Undercollateralized
Group at the Weighted Average Adjusted Net Mortgage Rate applicable
to the Undercollateralized Group(s) and (b) Available Funds of the
Overcollateralized Group(s) in Aggregate Loan Group I remaining after
making distributions to the Certificates of such Overcollateralized
Group(s) on such Distribution Date pursuant to Section 4.02; and
(2) to the related Senior Certificates of each Undercollateralized
Group in Aggregate Loan Group I, to the extent of the principal
portion of Available Funds of the Overcollateralized Group(s) in
Aggregate Loan Group I remaining after making distributions to the
Senior Certificates of such Overcollateralized Group(s) on such
Distribution Date pursuant to Section 4.02, until the aggregate Class
Certificate Balance of the Senior Certificates of each such
Undercollateralized Group(s) equals the aggregate Stated Principal
Balance of the Mortgage Loans in the related Loan Group(s).
The amount of principal from the Mortgage Loans in a Loan Group in an
Aggregate Loan Group that is distributed to the Holders of Senior Certificates
of an unrelated Loan Group in the same Aggregate Loan Group is referred to as
a "Transfer Payment." The Transfer Payment received by the Undercollateralized
Group is referred to as a "Transfer Payment Received." The Transfer Payment
made by the Overcollateralized Group is referred to as a "Transfer Payment
Made."
(b) If on any Distribution Date the aggregate Class Certificate
Balance of the Senior Certificates in a Senior Certificate Group related to a
Loan Group in Aggregate Loan Group II is greater than the aggregate Stated
Principal Balance of the Mortgage Loans in that Loan Group as of the first day
of the related Due Period (the "Undercollateralized Group"), then the Trustee
shall reduce the Available Funds of the other related Loan Groups in Aggregate
Loan Group II that are not undercollateralized (the "Overcollateralized
Groups"), as follows:
(1) to add to the Available Funds of each Undercollateralized Group
in Aggregate Loan Group II an amount equal to the lesser of (a) one
month's interest on the Transfer Payment of each Undercollateralized
Group at the Weighted Average Adjusted Net Mortgage Rate applicable
to the Undercollateralized Group(s) and (b) Available Funds of the
Overcollateralized Group(s) in Aggregate Loan Group II remaining
after making
99
distributions to the Certificates of such Overcollateralized Group(s)
on such Distribution Date pursuant to Section 4.02; and
(2) to the related Senior Certificates of each Undercollateralized
Group in Aggregate Loan Group II, to the extent of the principal
portion of Available Funds of the Overcollateralized Group(s) in
Aggregate Loan Group II remaining after making distributions to the
Senior Certificates of such Overcollateralized Group(s) on such
Distribution Date pursuant to Section 4.02, until the aggregate Class
Certificate Balance of the Senior Certificates of each such
Undercollateralized Group(s) equals the aggregate Stated Principal
Balance of the Mortgage Loans in the related Loan Group(s).
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
following information:
(i) the amount thereof allocable to principal, separately
identifying the aggregate amount of any Principal Prepayments,
Liquidation Proceeds and Subsequent Recoveries included therein;
(ii) the amount thereof allocable to interest, any Class
Unpaid Interest Amounts included in such distribution and any
remaining Class Unpaid Interest Amounts after giving effect to such
distribution;
(iii) if the distribution to the Holders of such Class of
Certificates is less than the full amount that would be distributable
to such Holders if there were sufficient funds available therefor,
the amount of the shortfall and the allocation thereof as between
principal and interest;
(iv) the Class Certificate Balance, Notional Amount,
Component Principal Balance or Component Notional Amount of each
Class of Certificates and any Component thereof after giving effect
to the distribution of principal on such Distribution Date;
(v) the Pool Stated Principal Balance of each Aggregate Loan
Group for the following Distribution Date;
(vi) the Senior Percentage and Subordinated Percentage for
each Loan Group for the following Distribution Date;
(vii) the amount of the Master Servicing Fees paid to or
retained by the Master Servicer with respect to such Distribution
Date;
(viii) the Pass-Through Rate for each Class of Certificates
and any Component thereof with respect to such Distribution Date;
100
(ix) the amount of Advances included in the distribution on
such Distribution Date and the aggregate amount of Advances
outstanding as of the close of business on such Distribution Date;
(x) the number and aggregate principal amounts of Mortgage
Loans in each Loan Group and in the related Aggregate Loan Group (A)
delinquent (exclusive of Mortgage Loans in foreclosure) (1) 1 to 30
days (2) 31 to 60 days (3) 61 to 90 days and (4) 91 or more days and
(B) in foreclosure and delinquent (1) 1 to 30 days (2) 31 to 60 days
(3) 61 to 90 days and (4) 91 or more days, as of the close of
business on the last day of the calendar month preceding such
Distribution Date;
(xi) with respect to any Mortgage Loan that became an REO
Property during the preceding calendar month, the loan number and
Stated Principal Balance of such Mortgage Loan as of the close of
business on the Determination Date preceding such Distribution Date
and the date of acquisition thereof;
(xii) the total number and principal balance of any REO
Properties in each Loan Group and in the related Aggregate Loan Group
(and market value, if available) as of the close of business on the
Determination Date preceding such Distribution Date;
(xiii) the Senior Prepayment Percentage and Subordinated
Prepayment Percentage for each Loan Group for the following
Distribution Date;
(xiv) the aggregate amount of Realized Losses in each Loan
Group and in the related Aggregate Loan Group incurred during the
preceding calendar month and the aggregate amount of Subsequent
Recoveries, if any, reducing the Realized Losses from the preceding
calendar months;
(xv) the amount of Carryover Shortfall Amounts paid on each
Class of LIBOR Certificates on such Distribution Date and the amount
of unpaid Carryover Shortfall Amounts on each Class of LIBOR
Certificates after giving effect to all distributions on such
Distribution Date;
(xvi) with respect to the second Distribution Date, the
number and aggregate balance of any Delay Delivery Mortgage Loans not
delivered within thirty days after the Closing Date;
(xvii) with respect to the Negative Amortization Mortgage
Loans, the amount of Net Deferred Interest added to the Class
Certificate Balance or Component Principal Balance of any related
Class of Certificates or any Component thereof;
(xviii) the amount due, and the amount received, in respect
of the Corridor Contract;
(xix) the amount paid to each Class of the LIBOR
Certificates (other than the Class 3-A-1 Certificates) from the
Carryover Shortfall Reserve Fund; and
(xx) the amount on deposit in the Carryover Shortfall
Reserve Fund for the following Distribution Date.
101
(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 to this Agreement.
(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 clauses (a)(i), (a)(ii) and (a)(vii) of this Section
4.06 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 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. [Reserved].
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 found on Telerate page 3750 as of 11:00
a.m. London time on each LIBOR Determination Date. "Telerate Page 3750" means
the display page currently so designated on the Moneyline Telerate Service
(formerly the Dow Xxxxx Markets) (or such other page as may replace that page
on that service for the purpose of displaying comparable rates or prices).
(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
102
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 or, in the case of the first
Interest Determination Date, 3.080%.
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 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.
103
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. Determination of MTA.
(a) On each related Interest Determination Date, so long as any Class
of MTA Certificates are outstanding, the Trustee shall determine MTA on the
basis of the most recent MTA figure available as of such related Interest
Determination Date, or in the case of the first Distribution Date 2.504%.
(b) If on any Interest Determination Date, MTA is no longer
available, the Trustee shall select a new index for the MTA Certificates that
is based on comparable information. When the Trustee selects a new index for
the MTA Certificates, the Pass-Through Margin for the MTA Certificates will
increase or decrease by the difference between the average MTA for the final
three years it was in effect and the average of the most recent three years
for the replacement index. The Pass-Through Margin for the MTA Certificates
will be increased by that difference if the average MTA is greater than the
average replacement index, and the Pass-Through Margin for the MTA
Certificates will be decreased by that difference if the replacement index is
greater than the average MTA.
(c) The Pass-Through Rate for the MTA Certificates for each Interest
Accrual Period shall be determined by the Trustee on each Interest
Determination Date so long as any class of MTA Certificates are outstanding on
the basis of MTA and the respective formulae appearing in footnotes
corresponding to the MTA Certificates in the table relating to the
Certificates in the Preliminary Statement.
The determination of MTA and the Pass-Through Rate for the MTA
Certificates by the Trustee shall (in the absence of manifest error) be final,
conclusive and binding upon each Holder of an MTA Certificate and the Trustee.
104
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 denominations, integral multiples in excess thereof (except that one
Certificate in each Class may be issued in a different amount which must be in
excess of the applicable minimum denomination) and aggregate denominations per
Class set forth in the Preliminary Statement.
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 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.
105
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 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. 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 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
106
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 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 the Code without the delivery to the Trustee of a Benefit Plan Opinion
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.
(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.
107
(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 to this
Agreement as Exhibit I.
(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 and Transferor
Certificate. 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
108
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.
(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
109
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 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 Trustee and any agent of the Master Servicer
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 Trustee nor any agent of the
Master Servicer 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
110
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.
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.
111
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.
SECTION 6.03. Limitation on Liability of the Depositor, the Sellers,
the Master Servicer and Others.
None of the Depositor, the Master Servicer or any Seller or any of
the directors, officers, employees or agents of the Depositor, the Master
Servicer 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 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, each
Seller and any director, officer, employee or agent of the Depositor, the
Master Servicer 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, each
Seller and
112
any director, officer, employee or agent of the Depositor, the Master Servicer
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 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
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 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 and
receipt by the Trustee of a letter from each Rating Agency that such a
resignation and appointment will not result in a downgrade or withdrawal of
the rating of any 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 such resignation shall become effective until the Trustee
or a successor master servicer shall have assumed the Master Servicer's
responsibilities, duties, liabilities and obligations under this Agreement.
113
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 or the Depositor or to the Master Servicer 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, 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 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
(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.
114
If (a) an Event of Default described in clauses (i) to (vi) of this
Section shall occur with respect to an Aggregate Loan Group, then, and in each
and every such case, so long as such Event of Default shall not have been
remedied, the Trustee may, or (b) 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 the Holders of Certificates related to that Aggregate Loan Group evidencing
not less than 66 2/3% of the Voting Rights evidenced by such Certificates, the
Trustee shall:
by notice in writing to the Master Servicer (with a copy to each
Rating Agency), terminate all of the rights and obligations of the Master
Servicer under this Agreement with respect to that Aggregate Loan Group and in
and to the related Mortgage Loans and the proceeds thereof, other than its
rights as a Certificateholder hereunder. On and after the receipt by the
Master Servicer of such written notice, all authority and power of the Master
Servicer hereunder with respect to that Aggregate Loan Group, whether with
respect to the related Mortgage Loans or otherwise, shall pass to and be
vested in the Trustee. The Trustee shall thereupon make any Advance related to
that Aggregate Loan Group which the Master Servicer failed to make subject to
Section 4.01 whether or not the obligations of the Master Servicer with
respect to that Aggregate Loan Group have been terminated pursuant to this
Section. With respect to such Aggregate Loan Group, 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 related 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 with respect to the
related Aggregate Loan Group, including, without limitation, the transfer to
the Trustee of all related cash amounts which shall at the time be credited to
the Certificate Account, or thereafter be received with respect to the related
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 with respect to that Aggregate Loan Group 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 (viii), and
any other amounts payable to such Master Servicer hereunder the entitlement to
which arose prior to the termination of its activities with respect to that
Aggregate Loan Group under this Agreement.
SECTION 7.02. Trustee to Act; Appointment of Successor.
On and after the time the Master Servicer receives a notice of
termination with respect to an Aggregate Loan Group 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 for
such Aggregate Loan Group 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
115
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 in that Aggregate Loan
Group 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, appoint, or 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 related Certificates 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 with respect to
that Aggregate Loan Group 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 related Mortgage Loans and 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
with respect to that Aggregate Loan Group (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 related Certificates in effect immediately
prior to such assignment and delegation will not be qualified or reduced as a
result of such assignment and delegation. 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
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 the related Mortgage Loans as it and such
successor shall agree; provided, however, that no such compensation shall be
in excess of the related Master Servicing Fee permitted to be paid to 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 with respect
to an Aggregate Loan Group shall give notice to the related 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
116
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 with respect to an Aggregate Loan Group, the Trustee shall
give prompt written notice thereof to the related Certificateholders and to
each Rating Agency.
(b) Within 60 days after the occurrence of any Event of Default with respect
to an Aggregate Loan Group, the Trustee shall transmit by mail to all related
Certificateholders notice of each such Event of Default hereunder known to the
Trustee, unless such Event of Default shall have been cured or waived.
117
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
118
by the Master Servicer in a Trustee Advance Notice in determining
whether it is required 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 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 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);
119
(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 any of the
Certificateholders, pursuant to the provisions of this Agreement,
unless 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.
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 and expenses) (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 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 or (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
120
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 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.
If at any time the Trustee shall cease to be eligible in accordance
with the provisions of Section 8.06 and shall fail to resign after written
request thereto by the Depositor, or if at any time 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, or a
tax is imposed with respect to the Trust Fund by any state in which the
Trustee or the Trust Fund is located and the imposition of such tax would be
avoided by the appointment of a different trustee, then the Depositor or the
Master Servicer may remove
121
the Trustee and appoint a successor trustee 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 and one copy 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, in triplicate, 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 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,
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 Corridor 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 Corridor
Contract Administrator under the Corridor 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 and its appointment
shall not adversely affect the then current rating of the Certificates.
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 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
122
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.
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 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
123
(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 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
124
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 REMIC 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 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
125
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 Shortfall Reserve Fund
as an outside reserve fund within the meaning of Treasury Regulation
1.860G-2(h) (a) a portion of which is owned by the holders of the Class II-A-X
Certificates and (b) a portion of which is owned by the Underwriter, and that
is not an asset of any REMIC created hereunder. The Trustee shall treat the
rights of the holders of the Class II-A-X Certificates to receive payments as
provided in the third to last paragraph of the Preliminary Statement as rights
in an interest rate cap contract written by the Holders of the LIBOR
Certificates. Thus, the Class II-A-X Certificates shall be treated as
representing ownership of not only a Master REMIC regular interest, but also
ownership of an interest in an interest rate cap contract, and the Class
II-A-X Certificates will be treated as having assumed the obligation to make
payments under an interest rate cap agreement. For purposes of determining the
issue price of the Master REMIC regular interests, the Trustee shall assume
that the cap contract obligations assumed by the Class II-A-X Certificates
have a value of $1,000. The Trustee shall treat the rights of the Holders of
the LIBOR Certificates (other than the Class 3-A-1 Certificates) to receive
payments from amounts on deposit in the Carryover Shortfall Reserve Fund in
respect of the Corridor Contract as rights in an interest rate corridor
contract written by the related Corridor Contract Counterparty. Thus, the
LIBOR Certificates (other than the Class 3-A-1 Certificates) shall be treated
as representing ownership of not only a Master REMIC regular interest, but
also ownership of an interest in an interest rate corridor contract. For
purposes of determining the issue price of the Master REMIC regular interests,
the Trustee shall assume that the Corridor Contract entered into by the
Corridor Contract Counterparty in respect of the LIBOR Certificates (other
than the Class 3-A-1 Certificates) has a value of $590,000.
ARTICLE IX
TERMINATION
SECTION 9.01. Termination upon Liquidation or Purchase of all
Mortgage Loans.
(1) 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 portion of the Trust Fund relating to Aggregate Loan Group
I shall terminate upon the earlier of: (a) the purchase by the Master Servicer
of all Mortgage Loans (and REO Properties) in Aggregate Loan Group I 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 Aggregate Loan Group I plus one
month's accrued interest thereon at the applicable Adjusted Mortgage Rate and
(ii) the lesser of (x) the appraised value of any REO Property as determined
by the higher of two appraisals completed by two independent appraisers
selected by the Master Servicer at the expense of the Master Servicer and
126
(y) the Stated Principal Balance of each Mortgage Loan in Aggregate Loan Group
I related to any REO Property and (iii) any remaining unpaid costs and damages
incurred by the Trust Fund with respect to Aggregate Loan Group I that arises
out of an actual violation of any predatory or abusive lending law that also
constitutes an actual breach of clause (50) on Schedule III-A, in all cases
plus accrued and unpaid interest thereon at the applicable Adjusted Mortgage
Rate; and (b) the later of (i) the maturity or other liquidation (or any
Advance with respect thereto) of the last Mortgage Loan in Aggregate Loan
Group I remaining in the Trust Fund and the disposition of all REO Property in
Aggregate Loan Group I and (ii) the distribution to the Certificateholders of
the Group I Certificates of all amounts required to be distributed to them
pursuant to this Agreement. In no event shall the trusts created hereby
continue beyond the earlier of (i) the expiration of 21 years from the death
of the 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 Master Servicer shall have the right to purchase all Mortgage
Loans and REO Properties relating to Aggregate Loan Group I pursuant to clause
(a) in the preceding paragraph of this Section 9.01(1); provided, however,
that in no event shall the Master Servicer exercise its right to purchase all
Mortgage Loans and REO Properties relating to Aggregate Loan Group I pursuant
to clause (a) in the preceding paragraph of this Section 9.01(1) before the
date on which the Pool Stated Principal Balance of Aggregate Loan Group I, at
the time of any such repurchase, is less than or equal to ten percent (10%) of
the Pool Stated Principal Balance of Aggregate Loan Group I as of the Cut-off
Date.
(2) 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 portion of the Trust Fund relating to Aggregate Loan Group
II shall terminate upon the earlier of: (a) the purchase by the Master
Servicer of all Mortgage Loans (and REO Properties) in Aggregate Loan Group II
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 Aggregate Loan Group II plus
one month's accrued interest thereon at the applicable Mortgage Rate and (ii)
the lesser of (x) the appraised value of any REO Property as determined by the
higher of two appraisals completed by two independent appraisers selected by
the Master Servicer at the expense of the Master Servicer and (y) the Stated
Principal Balance of each Mortgage Loan in Aggregate Loan Group II related to
any REO Property and (iii) any remaining unpaid costs and damages incurred by
the Trust Fund with respect to Aggregate Loan Group II that arises out of a
violation of any predatory or abusive lending law that also constitutes an
actual breach of clause (50) on Schedule III-A, in all cases plus accrued and
unpaid interest thereon at the applicable Adjusted Mortgage Rate; and (b) the
later of (i) the maturity or other liquidation (or any Advance with respect
thereto) of the last Mortgage Loan in Aggregate Loan Group II remaining in the
Trust Fund and the disposition of all REO Property in Aggregate Loan Group II
and (ii) the distribution to the Certificateholders of the Group II
Certificates of all amounts required to be distributed to them pursuant to
this Agreement. In no event shall the trusts created hereby continue beyond
the earlier of (i) the expiration of 21 years from the death of the 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 Master Servicer shall have the right to purchase all Mortgage
Loans and REO Properties relating to Aggregate Loan Group II pursuant to
clause (a) in the preceding paragraph
127
of this Section 9.01(2); provided, however, that in no event shall the Master
Servicer exercise its right to purchase all Mortgage Loans and REO Properties
relating to Aggregate Loan Group II pursuant to clause (a) in the preceding
paragraph of this Section 9.01(2) before the date on which the Pool Stated
Principal Balance of Aggregate Loan Group II, at the time of any such
repurchase, is less than or equal to ten percent (10%) of the Pool Stated
Principal Balance of Aggregate Loan Group II as of the Cut-off Date.
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 in the Certificate Account, the Master
Servicer shall direct the Trustee promptly to send a final distribution notice
to each Certificateholder. If the Master Servicer elects to terminate the
related portion of the Trust Fund pursuant to Section 9.01(1) or Section
9.01(2), as applicable, at least 20 days prior to the date notice is to be
mailed to the affected Certificateholders, the Master Servicer shall notify
the Depositor and the Trustee of the date the Master Servicer intends to cause
a termination pursuant to Section 9.01(1) or Section 9.01(2), as applicable,
and of the applicable repurchase price of the related Mortgage Loans and REO
Properties.
Notice of any termination of the Trust Fund relating to either
Aggregate Loan Group I or Aggregate Loan Group II, specifying the Distribution
Date on which related Certificateholders may surrender their Certificates for
payment of the final distribution and cancellation, shall be given promptly by
the Trustee by letter to such 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 related Certificates will be made
upon presentation and surrender of such 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
such Certificates at the office therein specified. The Master Servicer will
give such notice to each Rating Agency at the time such notice is given to the
related Certificateholders.
In the event such notice is given, the Master Servicer shall cause
all related 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 related Classes of Certificates. Upon such final deposit with
respect to the related Mortgage Loans and REO Properties 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 related Mortgage
Loans.
Upon presentation and surrender of the related Certificates, the
Trustee shall cause to be distributed to the Certificateholders of each
related 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
128
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
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 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, the Master Servicer 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 Master Servicer exercises its purchase option or
options as provided in Section 9.01, the related Mortgage Loans and REO
Properties then remaining in 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 Master Servicer 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 to fail to qualify as a REMIC at any time that any
Certificates are outstanding:
(1) Within 90 days prior to the final Distribution
Date set forth in the notice given by the Master Servicer under
Section 9.02, the Master Servicer shall prepare and the Trustee, at
the expense of the "tax matters person," shall adopt a plan of
complete liquidation of Aggregate Loan Group I and/or Aggregate Loan
Group II within the meaning of section 860F(a)(4) of the Code which,
as evidenced by an Opinion of Counsel (which opinion shall not be an
expense of the Trustee or the Tax Matters Person), meets the
requirements of a qualified liquidation; and
(2) Within 90 days after the time of adoption of
such a plan of complete liquidation with respect to Aggregate Loan
Group I and/or Aggregate Loan Group II, the Trustee shall sell the
related assets of the Trust Fund to the Master Servicer for cash in
accordance with Section 9.01.
(b) The Trustee as agent for any REMIC created under this Agreement
hereby agrees to adopt and sign such a plan of complete liquidation with
respect to Aggregate Loan Group I and/or Aggregate Loan Group II 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 Master Servicer.
129
(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 with respect to Aggregate Loan Group I
and/or Aggregate Loan Group II.
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
130
each Class of Certificates related to the applicable Aggregate Loan Group
adversely 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 such 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 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 related to the applicable Aggregate Loan Group the
Holders of which are required to consent to any such amendment, without the
consent of the Holders of all such Certificates related to the applicable
Aggregate Loan Group then outstanding.
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 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
131
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.
It is the express intent of the parties hereto that the conveyance of
the (i) of the 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 any 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, 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 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.
SECTION 10.05. Notices.
(a) The Trustee shall use its best efforts to promptly provide notice
to each Rating Agency 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;
132
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 3.17; 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 (1) in the case of the
Depositor, CWALT, Inc., 0000 Xxxx Xxxxxxx, Xxxxxxxxx, Xxxxxxxxxx 00000,
facsimile number: (000) 000-0000, Attention: Xxxxx X. Xxxxxxx, (2) 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, (3) 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, (4) 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, (5) 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, (6) 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, (7) 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 2005-24, or such other address as the
Trustee may hereafter furnish to the Depositor or Master Servicer, and (8) in
the case of the Rating Agencies, the address specified therefor in the
definition corresponding to the name of such Rating Agency. Notices to
Certificateholders shall be deemed given when mailed, first class postage
prepaid, to their respective addresses appearing in the Certificate Register.
133
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
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 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
134
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.
* * * * * *
135
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/ Xxxxx Xxxxxx
------------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
THE BANK OF NEW YORK,
as Trustee
By: /s/ Xxxxxxxx X. Xxxxxxxxxxx
--------------------------------------
Name: Xxxxxxxx X. Xxxxxxxxxxx
Title: Vice President
COUNTRYWIDE HOME LOANS, INC.,
as a Seller
By: /s/ Xxxxx Xxxxxx
------------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
PARK GRANADA LLC,
as a Seller
By: /s/ Xxxxx Xxxxxx
------------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
PARK SIENNA LLC,
as a Seller
By: /s/ Xxxxx Xxxxxx
------------------------------------
Name: Xxxxx Xxxxxx
Title: Assistant Vice President
PARK MONACO INC.,
as a Seller
By: /s/ Xxxxx Xxxxxx
------------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
COUNTRYWIDE HOME LOANS SERVICING LP,
as Master Servicer
By: COUNTRYWIDE GP, INC.
By: /s/ Xxxxx Xxxxxx
------------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
X-2
Acknowledged solely with respect to its
obligations under Section 4.01(b)
THE BANK OF NEW YORK, in its individual
capacity
By: /s/ Xxxx Xxxxxxxx
-----------------------------------
Name: Xxxx Xxxxxxxx
Title: Vice President
X-3
SCHEDULE I
Mortgage Loan Schedule
[Delivered at Closing to Trustee]
S-I-1
SCHEDULE II-A
CWALT, Inc.
Mortgage Pass-Through Certificates
Series 2005-24
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, 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 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-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
S-II-A-1
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 2005-24
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, 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 2005-24
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 certificate of formation or the limited liability
company agreement 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
S-II-C-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 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 2005-24
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 2005-24
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 in this Agreement,
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.
(1) 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.
(2) 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.
(3) No Mortgage Loan had a Loan-to-Value Ratio at
origination in excess of 100.00%.
(4) 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.
(5) [Reserved].
(6) There is no delinquent tax or assessment lien against
any Mortgaged Property.
S-III-A-1
(7) 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.
(8) 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.
(9) As of the Closing Date with respect to the Mortgage
Loans, to the best of Countrywide's knowledge, each Mortgaged Property is free
of material damage and in good repair.
(10) 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.
(11) As of the Closing Date in the case of the Mortgage
Loans, 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.
(12) A lender's policy of title insurance together with a
condominium endorsement, negative amortization 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 the unenforceability of the lien resulting
from the provisions of the Mortgage providing for adjustment of the mortgage
interest rate and/or the monthly payment including any negative amortization
thereunder. 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.
S-III-A-2
(13) 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.
(14) 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.
(15) 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.
(16) 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.
(17) 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.
(18) 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.
(19) 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.
(20) 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.
S-III-A-3
(21) 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.
(22) 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.
(23) 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.
(24) There is no pledged account or other security other
than real estate securing the Mortgagor's obligations.
(25) No Mortgage Loan has a shared appreciation feature, or
other contingent interest feature.
(26) Each Mortgage Loan contains a customary "due on sale"
clause.
(27) As of the Closing Date, 49.92%, 79.95%, 70.10% and
71.84% of the Mortgage Loans in Loan Group 1, Loan Group 2, Loan Group 3 and
Loan Group 4, respectively, in each case by aggregate Stated Principal Balance
of the Mortgage Loans in such Loan Group as of the Cut-off Date, provide for a
prepayment charge.
(28) 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% to 85.00%, from 12% to 20% for
Loan-to-Value Ratios between 85.01% to 90.00% and 20% to 25% for Loan-to-Value
Ratios between 90.01% to 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.
(29) As of the Cut-off Date, the improvements upon each
Mortgaged Property are covered by a valid and existing hazard insurance policy
with a generally acceptable carrier
S-III-A-4
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 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.
(30) 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.
(31) 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.
(32) 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.
(33) 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.
(34) Each Mortgage Loan is being master serviced by the
Master Servicer.
(35) 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
S-III-A-5
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.
(36) 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 Period 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.
(37) Each Mortgage Loan was underwritten in all material
respects in accordance with the underwriting guidelines described in the
Prospectus Supplement.
(38) 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.
(39) 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.
(40) 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.
(41) 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-A
can be made. Such selection was not made in a manner intended to adversely
affect the interests of Certificateholders.
(42) Except for 217 Mortgage Loans, each Mortgage Loan has a
payment date on or before the Due Date in the month of the first Distribution
Date.
(43) 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
S-III-A-6
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.
(44) The Mortgage Loans, individually and in the aggregate,
conform in all material respects to the descriptions thereof in the Prospectus
Supplement.
(45) No Mortgage Loan originated on or after October 1, 2002
through March 6, 2003 is governed by the Georgia Fair Lending Act.
(46) None of the Mortgage Loans are "high cost" loans as
defined by applicable predatory and abusive lending laws.
(47) None of the Mortgage Loans are covered by the Home
Ownership and Equity Protection Act of 1994 ("HOEPA").
(48) 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.).
(49) 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.).
(50) 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.
(51) 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 O (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 High 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.
(52) No Mortgagor related to a Mortgage Loan in Loan Group 3
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 3 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 3 were used to purchase single premium credit insurance policies or debt
cancellation agreements as part of the origination of, or as a condition to
closing, such Mortgage Loan.
S-III-A-7
(53) No Mortgage Loan in Loan Group 3 originated prior to
October 1, 2002 will impose prepayment charges for a term in excess of five
years after origination.
(54) The Master Servicer for each Mortgage Loan in Loan
Group 3 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.
(55) Each Mortgage Loan in Loan Group 3 had an original
principal balance that conforms to Xxxxxxx Mac guidelines concerning original
principal balance limits at the time of the origination of such Mortgage Loan.
(56) With respect to (a) any Mortgage Loan in Loan Group 3
originated by Countrywide from August 1, 2004 through April 30, 2005 and (b)
any Mortgage Loan in the Loan Group 3 originated by any other entity through
April 30, 2005, Countrywide represents, warrants and covenants that if the
related mortgage or the related Mortgage Note, or any document relating to the
loan transaction, contains a mandatory arbitration clause (that is, a clause
that requires the Mortgagor to submit to arbitration to resolve any dispute
arising out of or relating in any way to the mortgage loan transaction),
Countrywide (i) shall notify the related Mortgagor in writing within 60 days
after the issuance of the Certificates that none of the Sellers, the Master
Servicer or any subsequent party that acquires an interest in such Mortgage
Loan or services such arbitration clause against the Mortgagor, but that the
Mortgagor will continue to have the right to submit a dispute to arbitration
and (ii) will place a copy of such notice in the Mortgage File.
(57) Each Mortgage Loan in Loan Group 3 is a "qualified
mortgage" under Section 860G(a)(3) of the Code.
(58) No Mortgage Loan was originated on or after March 7,
2003, which is a "high cost home loan" as defined under the Georgia Fair
Lending Act.
(59) No Mortgage Loan is a "high cost home," "covered"
(excluding home loans defined as "covered home loans" in the New Jersey Home
Ownership Security Act of 2002 that were originated between November 26, 2003
and July 7, 2004), "high risk home" or "predatory" loan under any applicable
state, federal or local law (or a similarly classified loan using different
terminology under a law imposing heightened regulatory scrutiny or additional
legal liability for residential mortgage loans having high interest rates,
points and/or fees).
S-III-A-8
SCHEDULE III-B
CWALT, Inc.
Mortgage Pass-Through Certificates
Series 2005-24
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 that are 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-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 2005-24
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 that
are 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-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, 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.
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 2005-24
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 2005-24
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 2005-24
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
S-IV-1
(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's Servicing 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 Balance Schedules
*[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
[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
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-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-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-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-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
[FORM OF] INITIAL CERTIFICATION OF TRUSTEE
(INITIAL MORTGAGE LOANS)
[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. 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
F-2-1
Mortgage Loans identified on the Mortgage Loan Schedule, or (ii) the
collectability, insurability, effectiveness or suitability of any such Initial
Mortgage Loan.
F-2-2
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-2-3
EXHIBIT G
[FORM OF] DELAY DELIVERY CERTIFICATION
(INITIAL MORTGAGE LOANS)
[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;
G-2-1
(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
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
G-2-2
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 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-2-3
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-2-4
EXHIBIT H
[FORM OF] FINAL CERTIFICATION OF TRUSTEE
(INITIAL MORTGAGE LOANS)
[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-2-1
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 "Mortgage Loan
Schedule" in Article I of the Pooling and Servicing Agreement accurately
reflects information set forth in the Mortgage File.
H-2-2
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-2-3
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:
H-2-4
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 proposed
Treasury regulations promulgated pursuant to the Code 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,
I-2
as the Holder of a 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) on or about the Closing Date, 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 Master Servicer 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
STANDARD & POOR'S LEVELS(R) VERSION 5.6b GLOSSARY REVISED, APPENDIX E
APPENDIX E - Standard & Poor's Anti-Predatory Lending Categorization
--------------------------------------------------------------------
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
--------------
State/Jurisdiction Name of Anti-Predatory Lending Applicable Anti-
------------------ ------------------------------ ----------------
Law/Effective Date Predatory Lending Law
------------------ ---------------------
---------------------------------------------------------------------------------------------------------------------
Arkansas Arkansas Home Loan Protection Act, Ark. Code High Cost Home Loan
Xxx. 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 Lending Practices High Cost Home Loan
Act, Conn. Gen. Stat. xx.xx. 36a-746 et seq.
Effective October 1, 2001
---------------------------------------------------------------------------------------------------------------------
District of Columbia Home Loan Protection Act, D.C. Code xx.xx. Covered Loan
26-1151.01 et seq.
Effective for loans closed on or after January
28, 2003
---------------------------------------------------------------------------------------------------------------------
O-1
Standard & Poor's High Cost Loan Categorization
-----------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Category under
--------------
State/Jurisdiction Name of Anti-Predatory Lending Applicable Anti-
------------------ ------------------------------ ----------------
Law/Effective Date Predatory Lending Law
------------------ ---------------------
---------------------------------------------------------------------------------------------------------------------
Florida Fair Lending Act, Fla. Stat. Xxx. High Cost Home Loan
xx.xx. 494.0078 et seq.
Effective October 2, 2002
---------------------------------------------------------------------------------------------------------------------
Georgia (Oct. 1, 2002 - Georgia Fair Lending Act, Ga. Code High Cost Home Loan
Mar. 6, 2003) Xxx. xx.xx. 7-6A-1 et seq.
Effective October 1, 2002 - March 6, 2003
---------------------------------------------------------------------------------------------------------------------
Georgia as amended Georgia Fair Lending Act, Ga. Code High Cost Home Loan
(Mar. 7, 2003 - 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)
---------------------------------------------------------------------------------------------------------------------
Indiana Indiana Home Loan Practices Act, Ind. High Cost Home Loan
Code Xxx. xx.xx. 24-9-1-1 et seq.
Effective for loans originated on or after
January 1, 2005.
---------------------------------------------------------------------------------------------------------------------
O-2
Standard & Poor's High Cost Loan Categorization
-----------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Category under
--------------
State/Jurisdiction Name of Anti-Predatory Lending Applicable Anti-
------------------ ------------------------------ ----------------
Law/Effective Date Predatory Lending Law
------------------ ---------------------
---------------------------------------------------------------------------------------------------------------------
Kansas Consumer Credit Code, Kan. Stat. Xxx. xx.xx. High Loan to Value Consumer
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 16a-3-308a
became effective July 1, 1999
---------------------------------
High APR Consumer Loan (id. 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
---------------------------------------------------------------------------------------------------------------------
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
---------------------------------------------------------------------------------------------------------------------
Massachusetts Predatory Home Loan High Cost Home Mortgage Loan
Practices Act
Mass. Gen. Laws ch. 183C, xx.xx. 1 et seq.
Effective November 7, 2004
---------------------------------------------------------------------------------------------------------------------
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 High Cost Home Loan
Act of 2002, N.J. Rev. Stat. xx.xx. 46:10B
O-3
Standard & Poor's High Cost Loan Categorization
-----------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Category under
--------------
State/Jurisdiction Name of Anti-Predatory Lending Applicable Anti-
------------------ ------------------------------ ----------------
Law/Effective Date Predatory Lending Law
------------------ ---------------------
---------------------------------------------------------------------------------------------------------------------
22 et seq.
Effective for loans closed on or after
November 27, 2003
---------------------------------------------------------------------------------------------------------------------
New Mexico Home Loan Protection Act, N.M. Rev. High Cost Home Loan
Stat. xx.xx. 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 High Cost Home Loan
Cost Home 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 Covered Loan
the Ohio Code), Ohio Rev. Code Xxx. xx.xx.
1349.25 et seq.
Effective May 24, 2002
---------------------------------------------------------------------------------------------------------------------
Oklahoma Consumer Credit Code (codified in Subsection 10 Mortgage
various sections of Title 14A)
Effective July 1, 2000; amended
effective January 1, 2004
---------------------------------------------------------------------------------------------------------------------
South Carolina South Carolina High Cost and High Cost Home Loan
Consumer Home Loans 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 West Virginia Mortgage
Lender, Broker and Servicer Act, W. Loan Act Loan
Va. Code Xxx. xx.xx. 31-17-1 et seq.
---------------------------------------------------------------------------------------------------------------------
O-4
Standard & Poor's High Cost Loan Categorization
-----------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Category under
--------------
State/Jurisdiction Name of Anti-Predatory Lending Applicable Anti-
------------------ ------------------------------ ----------------
Law/Effective Date Predatory Lending Law
------------------ ---------------------
---------------------------------------------------------------------------------------------------------------------
Effective June 5, 2002
---------------------------------------------------------------------------------------------------------------------
Standard & Poor's Covered Loan Categorization
---------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Category under
--------------
State/Jurisdiction Name of Anti-Predatory Lending Applicable Anti-
------------------ ------------------------------ ----------------
Law/Effective Date Predatory Lending Law
------------------ ---------------------
---------------------------------------------------------------------------------------------------------------------
Georgia (Oct. 1, 2002 - Georgia Fair Lending Act, Ga. Code Covered Loan
Mar. 6, 2003) Xxx. xx.xx. 7-6A-1 et seq.
Effective October 1, 2002 - March 6,
2003
---------------------------------------------------------------------------------------------------------------------
New Jersey New Jersey Home Ownership Security Covered Home Loan
Act of 2002, N.J. Rev. Stat. xx.xx. 46:10B-
22 et seq.
Effective November 27, 2003 - July 5,
2004
---------------------------------------------------------------------------------------------------------------------
Standard & Poor's Home Loan Categorization
------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Category under
--------------
State/Jurisdiction Name of Anti-Predatory Lending Applicable Anti-
------------------ ------------------------------ ----------------
Law/Effective Date Predatory Lending Law
------------------ ---------------------
---------------------------------------------------------------------------------------------------------------------
Georgia (Oct. 1, 2002 - Georgia Fair Lending Act, Ga. Code Home Loan
Mar. 6, 2003) Xxx. xx.xx. 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
---------------------------------------------------------------------------------------------------------------------
O-5
Standard & Poor's Home Loan Categorization
------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Category under
--------------
State/Jurisdiction Name of Anti-Predatory Lending Applicable Anti-
------------------ ------------------------------ ----------------
Law/Effective Date Predatory Lending Law
------------------ ---------------------
---------------------------------------------------------------------------------------------------------------------
New Mexico Home Loan Protection Act, N.M. Rev. Home Loan
Stat. xx.xx. 58-21A-1 et seq.
Effective as of January 1, 2004; Revised
as of February 26, 2004
---------------------------------------------------------------------------------------------------------------------
North Carolina Restrictions and Limitations on High Consumer Home Loan
Cost Home 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 Loan
Consumer Home Loans Act, S.C. Code
Xxx. xx.xx. 37-23-10 et seq.
Effective for loans taken on or after
January 1, 2004
---------------------------------------------------------------------------------------------------------------------
O-6
EXHIBIT P
[Reserved]
P-1
