EXHIBIT 99.1
------------
The Pooling and Servicing Agreement
EXHIBIT 99.1
EXECUTION COPY
==============================
CWALT, INC.,
Depositor
COUNTRYWIDE HOME LOANS, INC.,
Seller
PARK GRANADA LLC,
Seller
PARK MONACO INC.,
Seller
PARK SIENNA LLC,
Seller
COUNTRYWIDE HOME LOANS SERVICING LP,
Master Servicer
and
THE BANK OF NEW YORK,
Trustee
-----------------------------------
POOLING AND SERVICING AGREEMENT
Dated as of February 1, 2007
-----------------------------------
ALTERNATIVE LOAN TRUST 2007-5CB
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2007-5CB
==============================
Table of Contents
Page
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ARTICLE I DEFINITIONS
SECTION 1.01. Defined Terms.............................................I-1
SECTION 1.02. Certain Interpretive Provisions..........................I-35
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES
SECTION 2.01. Conveyance of Mortgage Loans.............................II-1
SECTION 2.02. Acceptance by Trustee of the Mortgage Loans..............II-4
SECTION 2.03. Representations, Warranties and Covenants of the
Sellers and Master Servicer.............................II-6
SECTION 2.04. Representations and Warranties of the Depositor as to
the Mortgage Loans.......................................II-8
SECTION 2.05. Delivery of Opinion of Counsel in Connection with
Substitutions............................................II-9
SECTION 2.06. Execution and Delivery of Certificates...................II-9
SECTION 2.07. REMIC Matters............................................II-9
SECTION 2.08. Covenants of the Master Servicer........................II-10
ARTICLE III ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
SECTION 3.01. Master Servicer to Service Mortgage Loans...............III-1
SECTION 3.02. Subservicing; Enforcement of the Obligations of
Subservicers............................................III-2
SECTION 3.03. Rights of the Depositor and the Trustee in Respect of
the Master Servicer.....................................III-2
SECTION 3.04. Trustee to Act as Master Servicer.......................III-2
SECTION 3.05. Collection of Mortgage Loan Payments; the Certificate
Account; the Distribution Account; the Supplemental
Interest Trust and the Corridor Contract Reserve Fund...III-3
SECTION 3.06. Collection of Taxes, Assessments and Similar Items;
Escrow Accounts.........................................III-6
SECTION 3.07. Access to Certain Documentation and Information
Regarding the Mortgage Loans............................III-6
SECTION 3.08. Permitted Withdrawals from the Certificate Account,
the Distribution Account and the Corridor Contract
Reserve Fund............................................III-7
SECTION 3.09. Maintenance of Hazard Insurance; Maintenance of
Primary Insurance Policies..............................III-9
SECTION 3.10. Enforcement of Due-on-Sale Clauses; Assumption
Agreements.............................................III-10
SECTION 3.11. Realization Upon Defaulted Mortgage Loans; Repurchase
of Certain Mortgage Loans..............................III-11
SECTION 3.12. Trustee to Cooperate; Release of Mortgage Files........III-14
SECTION 3.13. Documents, Records and Funds in Possession of Master
Servicer to be Held for the Trustee....................III-14
SECTION 3.14. Servicing Compensation.................................III-15
SECTION 3.15. Access to Certain Documentation........................III-15
SECTION 3.16. Annual Statement as to Compliance......................III-16
SECTION 3.17. Errors and Omissions Insurance; Fidelity Bonds.........III-16
SECTION 3.18. The Corridor Contracts.................................III-16
i
ARTICLE IV DISTRIBUTIONS AND ADVANCES BY THE MASTER SERVICER
SECTION 4.01. Advances.................................................IV-1
SECTION 4.02. Priorities of Distribution...............................IV-2
SECTION 4.03. [Reserved]...............................................IV-8
SECTION 4.04. Allocation of Realized Losses............................IV-8
SECTION 4.05. Cross-Collateralization; Adjustments to Available
Funds....................................................IV-9
SECTION 4.06. Monthly Statements to Certificateholders.................IV-9
SECTION 4.07. Determination of Pass-Through Rates for COFI
Certificates............................................IV-10
SECTION 4.08. Determination of Pass-Through Rates for LIBOR
Certificates............................................IV-11
SECTION 4.09. Distributions from the Corridor Contract Reserve Fund...IV-12
ARTICLE V THE CERTIFICATES
SECTION 5.01. The Certificates..........................................V-1
SECTION 5.02. Certificate Register; Registration of Transfer and
Exchange of Certificates..................................V-1
SECTION 5.03. Mutilated, Destroyed, Lost or Stolen Certificates.........V-5
SECTION 5.04. Persons Deemed Owners.....................................V-6
SECTION 5.05. Access to List of Certificateholders' Names and
Addresses.................................................V-6
SECTION 5.06. Maintenance of Office or Agency...........................V-6
SECTION 5.07. Depositable and Exchangeable Certificates.................V-6
ARTICLE VI THE DEPOSITOR AND THE MASTER SERVICER
SECTION 6.01. Respective Liabilities of the Depositor and the Master
Servicer.................................................VI-1
SECTION 6.02. Merger or Consolidation of the Depositor or the Master
Servicer.................................................VI-1
SECTION 6.03. Limitation on Liability of the Depositor, the Sellers,
the Master Servicer and Others...........................VI-1
SECTION 6.04. Limitation on Resignation of Master Servicer.............VI-2
ARTICLE VII DEFAULT
SECTION 7.01. Events of Default.......................................VII-1
SECTION 7.02. Trustee to Act; Appointment of Successor................VII-3
SECTION 7.03. Notification to Certificateholders......................VII-4
ARTICLE VIII CONCERNING THE TRUSTEE
SECTION 8.01. Duties of Trustee......................................VIII-1
SECTION 8.02. Certain Matters Affecting the Trustee..................VIII-2
SECTION 8.03. Trustee Not Liable for Certificates or Mortgage Loans..VIII-3
SECTION 8.04. Trustee May Own Certificates...........................VIII-3
SECTION 8.05. Trustee's Fees and Expenses............................VIII-3
SECTION 8.06. Eligibility Requirements for Trustee...................VIII-3
SECTION 8.07. Resignation and Removal of Trustee.....................VIII-4
SECTION 8.08. Successor Trustee......................................VIII-5
SECTION 8.09. Merger or Consolidation of Trustee.....................VIII-5
SECTION 8.10. Appointment of Co-Trustee or Separate Trustee..........VIII-5
SECTION 8.11. Tax Matters............................................VIII-7
SECTION 8.12. Monitoring of Significance Percentage..................VIII-9
ii
ARTICLE IX TERMINATION
SECTION 9.01. Termination upon Liquidation or Purchase of all
Mortgage Loans...........................................IX-1
SECTION 9.02. Final Distribution on the Certificates...................IX-1
SECTION 9.03. Additional Termination Requirements......................IX-2
ARTICLE X MISCELLANEOUS PROVISIONS
SECTION 10.01. Amendment.................................................X-1
SECTION 10.02. Recordation of Agreement; Counterparts....................X-2
SECTION 10.03. Governing Law.............................................X-2
SECTION 10.04. Intention of Parties......................................X-2
SECTION 10.05. Notices...................................................X-4
SECTION 10.06. Severability of Provisions................................X-5
SECTION 10.07. Assignment................................................X-5
SECTION 10.08. Limitation on Rights of Certificateholders................X-5
SECTION 10.09. Inspection and Audit Rights...............................X-6
SECTION 10.10. Certificates Nonassessable and Fully Paid.................X-6
SECTION 10.11. [Reserved]................................................X-6
SECTION 10.12. Protection of Assets......................................X-6
ARTICLE XI EXCHANGE ACT REPORTING
SECTION 11.01. Filing Obligations.......................................XI-1
SECTION 11.02. Form 10-D Filings........................................XI-1
SECTION 11.03. Form 8-K Filings.........................................XI-2
SECTION 11.04. Form 10-K Filings........................................XI-2
SECTION 11.05. Xxxxxxxx-Xxxxx Certification.............................XI-2
SECTION 11.06. Form 15 Filing...........................................XI-3
SECTION 11.07. Report on Assessment of Compliance and Attestation.......XI-3
SECTION 11.08. Use of Subservicers and Subcontractors...................XI-4
SECTION 11.09. Amendments...............................................XI-5
SECTION 11.10. Reconciliation of Accounts...............................XI-5
Available Exchanges of Depositable Certificates for Exchangeable
Certificates(1)(2) 1
SCHEDULES
Schedule I Mortgage Loan Schedule....................................S-I-1
Schedule II-A Representations and Warranties of Countrywide..........S-II-A-1
Schedule II-B Representations and Warranties of Park Granada.........S-II-B-1
Schedule II-C Representations and Warranties of Park Monaco..........S-II-C-1
Schedule II-D Representations and Warranties of Park Sienna..........S-II-D-1
Schedule III-A Representations and Warranties of Countrywide
as to the Mortgage Loans..............................S-III-A-1
Schedule III-B Representations and Warranties of Countrywide
as to the Countrywide Mortgage Loans..................S-III-B-1
Schedule III-C Representations and Warranties of Park Granada
as to the Park Granada Mortgage Loans.................S-III-C-1
iii
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-I
Schedule VII Schedule of Available Exchanges of Depositable
Certificates for Exchangeable Certificates..............S-VII-I
iv
EXHIBITS
Exhibit A: Form of Senior or Exchangeable Certificate (excluding
Notional Amount Certificates)..............................A-1
Exhibit B: Form of Subordinated Certificate...........................B-1
Exhibit C-1: Form of Class A-R Certificate............................C-1-1
Exhibit C-2: [Reserved]...............................................C-2-1
Exhibit C-3: [Reserved]...............................................C-3-1
Exhibit D: Form of Notional Amount Certificate........................D-1
Exhibit E: Form of Reverse of Certificates............................E-1
Exhibit F-1: Form of Initial Certification of Trustee.................F-1-1
Exhibit F-2: [Reserved]...............................................F-2-1
Exhibit G-1: Form of Delay Delivery Certification of Trustee..........G-1-1
Exhibit G-2: [Reserved]...............................................G-2-1
Exhibit H-1: Form of Final Certification of Trustee...................H-1-1
Exhibit H-2: [Reserved]...............................................H-2-1
Exhibit I: Form of Transfer Affidavit.................................I-1
Exhibit J-1: Form of Transferor Certificate (Residual)................J-1-1
Exhibit J-2: Form of Transferor Certificate (Private).................J-2-1
Exhibit K: Form of Investment Letter (Non-Rule 144A)..................K-1
Exhibit L-1: Form of Rule 144A Letter.................................L-1-1
Exhibit L-2: Form of ERISA Letter (Covered Certificates)..............L-2-1
Exhibit M: Form of Request for Release (for Trustee)..................M-1
Exhibit N: Form of Request for Release (Mortgage Loan - Paid
in Full, Repurchased and Replaced).........................N-1
Exhibit O: [Reserved].................................................O-1
Exhibit P: [Reserved].................................................P-1
Exhibit Q: The then current version of Standard & Poor's LEVELS(R) Version
5.7 Glossary Revised, Appendix E...........................Q-1
Exhibit R: Form of Corridor Contract..................................R-1
Exhibit S-1: [Reserved]...............................................S-1-1
Exhibit S-2: [Reserved]...............................................S-2-1
Exhibit T: [Reserved].................................................T-1
Exhibit U: Form of Monthly Statement..................................U-1
Exhibit V-1: Form of Performance Certification (Subservicer)..........V-1-1
Exhibit V-2: Form of Performance Certification (Trustee)..............V-2-1
Exhibit W: Form of Servicing Criteria to be Addressed in Assessment of
Compliance
Statement..................................................W-1
Exhibit X: Form of List of Item 1119 Parties..........................X-1
Exhibit Y: Form of Xxxxxxxx-Xxxxx Certification (Replacement of Master
Servicer)..................................................Y-1
v
THIS POOLING AND SERVICING AGREEMENT, dated as of February 1,
2007, among CWALT, INC., a Delaware corporation, as depositor (the
"Depositor"), COUNTRYWIDE HOME LOANS, INC. ("Countrywide"), a New York
corporation, as a seller (a "Seller"), PARK GRANADA LLC ("Park Granada"), a
Delaware limited liability company, as a seller (a "Seller"), PARK MONACO INC.
("Park Monaco"), a Delaware corporation, as a seller (a "Seller"), PARK SIENNA
LLC ("Park Sienna"), a Delaware limited liability company, as a seller (a
"Seller"), COUNTRYWIDE HOME LOANS SERVICING LP, a Texas limited partnership,
as master servicer (the "Master Servicer"), and THE BANK OF NEW YORK, a
banking corporation organized under the laws of the State of New York, as
trustee (the "Trustee").
WITNESSETH THAT
In consideration of the mutual agreements herein contained, the
parties hereto agree as follows:
PRELIMINARY STATEMENT
The Depositor is the owner of the Trust Fund that is hereby
conveyed to the Trustee in return for the Certificates. For federal income tax
purposes, the Trustee shall treat the Trust Fund as consisting of, among other
things, a trust (the "ES Trust") beneath which are two real estate mortgage
investment conduits (or in the alternative, the "Lower Tier REMIC" and the
"Master REMIC") and shall make all elections as necessary for such treatment.
The Lower Tier REMIC will hold all the assets of the Trust Fund and will issue
several classes of uncertificated Lower Tier REMIC Interests. The Class
LTR-A-R Interest is hereby designated as the residual interest in the Lower
Tier REMIC and each other Lower Tier REMIC Interest is hereby designated as a
regular interest in the Lower Tier REMIC. The Master REMIC will hold all the
regular interests in the Lower Tier REMIC and will issue several classes of
uncertificated Master REMIC Interests. The Class MR-A-R Interest is hereby
designated as the residual interest in the Master REMIC and each other Master
REMIC Interest is hereby designated as a regular interest in the Master REMIC.
The "latest possible maturity date," for federal income tax purposes, of all
REMIC regular interests created hereby will be the Latest Possible Maturity
Date.
The Corridor Contracts, the Supplemental Interest Trust and the
Corridor Contract Reserve Fund will not form part of any REMIC.
1
The following table sets forth characteristics of the ES Trust Certificates,
together with the minimum denominations and integral multiples in excess
thereof in which such Classes shall be issuable (except one Residual
Certificate representing the Tax Matters Person Certificate may be issued in a
different amount):
---------------- ------------------- --------------- ---------------- ------------ -----------------
Integral
Initial Maximum Multiples Classes of
Class Certificate Pass-Through in Excess Master REMIC
Class Balance/Notional Rate Minimum of Interests
Designation Amount (per annum) Denomination Minimum Represented
----------- ------ ----------- ------------ ------- -----------
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-1 $143,325,000 6.00% $25,000.00 $1.00 XX-0-X-0X,
XX-0-X-0X,
XX-0-X-0X,
XX-0-X-0X and
MR-1-A-1E (27)
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-2 $44,773,000 6.00% $25,000.00 $1.00 MR-1-A-2
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-3 $2,900,000 6.00% $25,000.00 $1.00 MR-1-A-3
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-4 $216,407,000 6.00% $25,000.00 $1.00 MR-1-A-4
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-5 $25,000,000(1) (2) $25,000.00(3) $1.00(3) MR-1-A-5
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-6 $25,000,000 (4) $25,000.00 $1.00 MR-1-A-6
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-7 $29,000 6.00% $25,000.00 $1.00 MR-1-A-7
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-8 $29,000 6.00% $25,000.00 $1.00 MR-1-A-8
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-9 $22,415,000 6.00% $25,000.00 $1.00 MR-1-A-9
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-10 $340,743,000 6.00% $25,000.00 $1.00 XX-0-X-00X,
XX-0-X-00X,
XX-0-X-00X,
XX-0-X-00X and
MR-1-A-10E (27)
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-11 $12,240,000 6.00% $25,000.00 $1.00 MR-1-A-11
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-12 $6,190,000 6.00% $25,000.00 $1.00 MR-1-A-12
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-13 $33,540,000 6.00% $25,000.00 $1.00 MR-1-A-13
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-14 $60,000,000(1) (5) $25,000.00(3) $1.00(3) MR-1-A-14
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-15 $60,000,000 (6) $25,000.00 $1.00 MR-1-A-15
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-16 $46,423,000 6.00% $25,000.00 $1.00 MR-1-A-16
---------------- ------------------- --------------- ---------------- ------------ -----------------
2
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-17 $61,000 6.00% $25,000.00 $1.00 MR-1-A-17
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-18 $275,640,000(1) (7) $25,000.00(3) $1.00(3) MR-1-A-18
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-19 $275,640,000 (8) $25,000.00 $1.00 MR-1-A-19
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-20 $100,000,000(1) (9) $25,000.00(3) $1.00(3) MR-1-A-20
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-21 $100,000,000 (10) $25,000.00 $1.00 MR-1-A-21
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-22 $30,000,000(1) (11) $25,000.00(3) $1.00(3) MR-1-A-22
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-23 $30,000,000 (12) $25,000.00 $1.00 MR-1-A-23
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-24 $2,094,000 (13) $25,000.00 $1.00 MR-1-A-24
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-25 $95,550,000 5.50% $25,000.00 $1.00 MR-1-A
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-26 $47,775,000(1) (14) $25,000.00(3) $1.00(3) MR-1-A-1D and
MR-1-A-1E
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-27 $47,775,000 (15) $25,000.00 $1.00 MR-1-A-1B and
MR-1-A-1C
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-28 $114,660,000 5.75% $25,000.00 $1.00 XX-0-X-0X,
XX-0-X-0X and
MR-1-A-1E
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-29 $28,665,000(1) (16) $25,000.00(3) $1.00(3) MR-1-A-1D
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-30 $28,665,000 (17) $25,000.00 $1.00 MR-1-A-1B
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-31 $227,162,000 5.50% $25,000.00 $1.00 MR-1-A-10A
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-32 $113,581,000(1) (18) $25,000.00(3) $1.00(3) MR-1-A-10D and
MR-1-A-10E
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-33 $113,581,000 (19) $25,000.00 $1.00 MR-1-A-10B and
MR-1-A-10C
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-34 $272,595,000 5.75% $25,000.00 $1.00 XX-0-X-00X,
XX-0-X-00X xxx
XX-0-X-00X
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-35 $68,148,000(1) (20) $25,000.00(3) $1.00(3) MR-1-A-10D
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-36 $68,148,000 (21) $25,000.00 $1.00 MR-1-A-10B
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-A-37 $188,098,000 6.00% $25,000.00 $1.00 XX-0-X-0X,
XX-0-X-0X,
XX-0-X-0X,
---------------- ------------------- --------------- ---------------- ------------ -----------------
3
---------------- ------------------- --------------- ---------------- ------------ -----------------
XX-0-X-0X,
XX-0-X-0X,
XX-0-X-00X,
XX-0-X-00X,
XX-0-X-00X,
XX-0-X-00X and
MR-1-A-1E (27)
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 2-A-1 $60,561,000 6.00% $25,000.00 $1.00 MR-2-A-1
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 2-A-2 $950,000 6.00% $25,000.00 $1.00 MR-2-A-2
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 2-A-3 $27,882,000 6.00% $25,000.00 $1.00 MR-2-A-3
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 2-A-4 $50,000,000(1) (22) $25,000.00(3) $1.00(3) MR-2-A-4
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 2-A-5 $50,000,000 (23) $25,000.00 $1.00 MR-2-A-5
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 2-A-6 $10,000 6.00% $10,000.00 $1.00 MR-2-A-6
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 2-A-7 $9,000 6.00% $9,000.00 $1.00 MR-2-A-7
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 1-X $1,336,102,464(1) (24) $25,000.00(3) $1.00(3) MR-1-X
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class 2-X $136,179,076(1) (25) $25,000.00(3) $1.00(3) MR-2-X
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class PO $240,436 (13) $25,000.00 $1.00 MR-PO
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class A-R(26) $100.00 6.00% (26) (26) LTR-A-R and
MR-A-R
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class M $33,927,000 6.00% $25,000.00 $1.00 MR-M
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class B-1 $14,202,000 6.00% $25,000.00 $1.00 MR-B-1
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class B-2 $10,256,900 6.00% $25,000.00 $1.00 MR-B-2
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class B-3 $7,101,000 6.00% $100,000.00 $1.00 MR-B-3
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class B-4 $6,312,000 6.00% $100,000.00 $1.00 MR-B-4
---------------- ------------------- --------------- ---------------- ------------ -----------------
Class B-5 $4,734,029.33 6.00% $100,000.00 $1.00 MR-B-5
---------------- ------------------- --------------- ---------------- ------------ -----------------
_____________________________________________
(1) This Class of Certificates will be a Class of Notional Amount
Certificates, will have no Class Certificate Balance and will bear
interest on its Notional Amount.
(2) The Pass-Through Rate for the Class 1-A-5 Certificates for the Interest
Accrual Period for any Distribution Date will be a per annum rate equal
to 5.40% minus LIBOR, subject to a maximum and
4
minimum Pass-Through Rate of 5.40% and 0.00% per annum, respectively.
The Pass-Through Rate for the Class 1-A-5 Certificates during the
initial Interest Accrual Period is 0.08% per annum.
(3) Minimum denomination is based on the Notional Amount of such Class.
(4) The Pass-Through Rate for the Class 1-A-6 Certificates for the Interest
Accrual Period for any Distribution Date will be a per annum rate equal
to LIBOR plus 0.60%, subject to a maximum and minimum Pass-Through Rate
of 6.00% and 0.60% per annum, respectively. The Pass-Through Rate for
the Class 1-A-6 Certificates during the initial Interest Accrual Period
is 5.92% per annum.
(5) The Pass-Through Rate for the Class 1-A-14 Certificates for the Interest
Accrual Period for any Distribution Date will be a per annum rate equal
to 5.35% minus LIBOR, subject to a maximum and minimum Pass-Through Rate
of 5.35% and 0.00% per annum, respectively. The Pass-Through Rate for
the Class 1-A-14 Certificates during the initial Interest Accrual Period
is 0.03% per annum.
(6) The Pass-Through Rate for the Class 1-A-15 Certificates for the Interest
Accrual Period for any Distribution Date will be a per annum rate equal
to LIBOR plus 0.40%, subject to a maximum and minimum Pass-Through Rate
of 5.75% and 0.40% per annum, respectively. The Pass-Through Rate for
the Class 1-A-15 Certificates during the initial Interest Accrual Period
is 5.72% per annum.
(7) The Pass-Through Rate for the Class 1-A-18 Certificates for the Interest
Accrual Period for any Distribution Date will be a per annum rate equal
to 5.65% minus LIBOR, subject to a maximum and minimum Pass-Through Rate
of 5.65% and 0.00% per annum, respectively. The Pass-Through Rate for
the Class 1-A-18 Certificates during the initial Interest Accrual Period
is 0.33% per annum.
(8) The Pass-Through Rate for the Class 1-A-19 Certificates for the Interest
Accrual Period for any Distribution Date will be a per annum rate equal
to LIBOR plus 0.45%, subject to a maximum and minimum Pass-Through Rate
of 6.10% and 0.45% per annum, respectively. The Pass-Through Rate for
the Class 1-A-19 Certificates during the initial Interest Accrual Period
is 5.77% per annum.
(9) The Pass-Through Rate for the Class 1-A-20 Certificates for the Interest
Accrual Period for any Distribution Date will be a per annum rate equal
to 5.46% minus LIBOR, subject to a maximum and minimum Pass-Through Rate
of 5.46% and 0.00% per annum, respectively. The Pass-Through Rate for
the Class 1-A-20 Certificates during the initial Interest Accrual Period
is 0.14% per annum.
(10) The Pass-Through Rate for the Class 1-A-21 Certificates for the Interest
Accrual Period for any Distribution Date will be a per annum rate equal
to LIBOR plus 0.54%, subject to a maximum and minimum Pass-Through Rate
of 6.00% and 0.54% per annum, respectively. The Pass-Through Rate for
the Class 1-A-21 Certificates during the initial Interest Accrual Period
is 5.86% per annum.
(11) The Pass-Through Rate for the Class 1-A-22 Certificates for the Interest
Accrual Period for any Distribution Date will be a per annum rate equal
to 5.45% minus LIBOR, subject to a maximum and minimum Pass-Through Rate
of 5.45% and 0.00% per annum, respectively. The Pass-Through Rate for
the Class 1-A-22 Certificates during the initial Interest Accrual Period
is 0.13% per annum.
(12) The Pass-Through Rate for the Class 1-A-23 Certificates for the Interest
Accrual Period for any Distribution Date will be a per annum rate equal
to LIBOR plus 0.55%, subject to a maximum and minimum Pass-Through Rate
of 6.00% and 0.55% per annum, respectively. The Pass-Through Rate for
the Class 1-A-23 Certificates during the initial Interest Accrual Period
is 5.87% per annum.
5
(13) This Class of Certificates will be a Class of Principal Only
Certificates and will not receive any distributions of interest.
(14) The Pass-Through Rate for the Class 1-A-26 Certificates for the Interest
Accrual Period for any Distribution Date will be a per annum rate equal
to 6.75% minus LIBOR, subject to a maximum and minimum Pass-Through Rate
of 6.75% and 0.00% per annum, respectively. The Pass-Through Rate for
the Class 1-A-26 Certificates during the initial Interest Accrual Period
is 1.43% per annum.
(15) The Pass-Through Rate for the Class 1-A-27 Certificates for the Interest
Accrual Period for any Distribution Date will be a per annum rate equal
to LIBOR plus 0.25%, subject to a maximum and minimum Pass-Through Rate
of 7.00% and 0.25% per annum, respectively. The Pass-Through Rate for
the Class 1-A-27 Certificates during the initial Interest Accrual Period
is 5.57% per annum.
(16) The Pass-Through Rate for the Class 1-A-29 Certificates for the Interest
Accrual Period for any Distribution Date will be a per annum rate equal
to 6.75% minus LIBOR, subject to a maximum and minimum Pass-Through Rate
of 6.75% and 0.00% per annum, respectively. The Pass-Through Rate for
the Class 1-A-29 Certificates during the initial Interest Accrual Period
is 1.43% per annum.
(17) The Pass-Through Rate for the Class 1-A-30 Certificates for the Interest
Accrual Period for any Distribution Date will be a per annum equal to
LIBOR plus 0.25%, subject to a maximum and minimum Pass-Through Rate of
7.00% and 0.25% per annum, respectively. The Pass-Through Rate for the
Class 1-A-30 Certificates during the initial Interest Accrual Period is
5.57% per annum.
(18) The Pass-Through Rate for the Class 1-A-32 Certificates for the Interest
Accrual Period for any Distribution Date will be a per annum rate equal
to 6.75% minus LIBOR, subject to a maximum and minimum Pass-Through Rate
of 6.75% and 0.00% per annum, respectively. The Pass-Through Rate for
the Class 1-A-32 Certificates during the initial Interest Accrual Period
is 1.43% per annum.
(19) The Pass-Through Rate for the Class 1-A-33 Certificates for the Interest
Accrual Period for any Distribution Date will be a per annum rate equal
to LIBOR plus 0.25%, subject to a maximum and minimum Pass-Through Rate
of 7.00% and 0.25% per annum, respectively. The Pass-Through Rate for
the Class 1-A-33 Certificates during the initial Interest Accrual Period
is 5.57% per annum.
(20) The Pass-Through Rate for the Class 1-A-35 Certificates for the Interest
Accrual Period for any Distribution Date will be a per annum rate equal
to 6.75% minus LIBOR, subject to a maximum and minimum Pass-Through Rate
of 6.75% and 0.00% per annum, respectively. The Pass-Through Rate for
the Class 1-A-35 Certificates during the initial Interest Accrual Period
is 1.43% per annum.
(21) The Pass-Through Rate for the Class 1-A-36 Certificates for the Interest
Accrual Period for any Distribution Date will be a per annum equal to
LIBOR plus 0.25%, subject to a maximum and minimum Pass-Through Rate of
7.00% and 0.25% per annum, respectively. The Pass-Through Rate for the
Class 1-A-36 Certificates during the initial Interest Accrual Period is
5.57% per annum.
(22) The Pass-Through Rate for the Class 2-A-4 Certificates for the Interest
Accrual Period for any Distribution Date will be a per annum rate equal
to 5.48% minus LIBOR, subject to a maximum and minimum Pass-Through Rate
of 5.48% and 0.00% per annum, respectively. The Pass-Through Rate for
the Class 2-A-4 Certificates during the initial Interest Accrual Period
is 0.16% per annum.
(23) The Pass-Through Rate for the Class 2-A-5 Certificates for the Interest
Accrual Period for any Distribution Date will be a per annum rate equal
to LIBOR plus 0.52%, subject to a maximum and
6
minimum Pass-Through Rate of 6.00% and 0.52% per annum, respectively.
The Pass-Through Rate for the Class 2-A-5 Certificates during the
initial Interest Accrual Period is 5.84% per annum.
(24) The Pass-Through Rate for the Class 1-X Certificates for the Interest
Accrual Period for any Distribution Date will equal the excess of (a)
the weighted average of the Adjusted Net Mortgage Rates of the
Non-Discount Mortgage Loans, weighted on the basis of the Stated
Principal Balances thereof as of the Due Date in the preceding calendar
month (after giving effect to Principal Prepayments received in the
Prepayment Period related to such prior Due Date), over (b) 6.00%. The
Pass-Through Rate for the Class 1-X Certificates for the Interest
Accrual Period for the first Distribution Date is 0.3384795% per annum.
(25) The Pass-Through Rate for the Class 2-X Certificates for the Interest
Accrual Period for any Distribution Date will equal the excess of (a)
the weighted average of the Adjusted Net Mortgage Rates of the
Non-Discount Mortgage Loans, weighted on the basis of the Stated
Principal Balances thereof as of the Due Date in the preceding calendar
month (after giving effect to Principal Prepayments received in the
Prepayment Period related to such prior Due Date), over (b) 6.00%. The
Pass-Through Rate for the Class 2-X Certificates for the Interest
Accrual Period for the first Distribution Date is 0.3291238% per annum.
(26) The Class A-R Certificates represent the sole Class of residual interest
in the Master REMIC and in the Lower Tier REMIC. The Class A-R
Certificate shall be issued by the ES Trust 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.
(27) See Schedule VII for information regarding the Recombinations of the
Depositable and Exchangeable Certificates related to these
uncertificated Master REMIC Interests.
7
The following table specifies the class designation, interest rate, and
principal amount for each class of Master REMIC Interest:
------------------------- ----------------------- ----------------------- ---------------------------
Initial Principal Possible Corresponding ES
Master REMIC Interest Balance/Notional -------------------------
Designation Amount Interest Rate Trust Certificate
----------- ------ ------------- -----------------
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-1A $95,550,000 5.50% Class 1-A-1, Class
1-A-25, Class 1-A-28 and
Class 1-A-37
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-1B $28,665,000 LIBOR + .25% Class 1-A-1, Class
1-A-27, Class 1-A-30 and
Class A-37
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-1C $19,110,000 LIBOR + .25% Class 1-A-1, Class
1-A-27, Class 1-A-28 and
Class 1-A-37
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-1D $28,665,000(3) 6.75%-LIBOR Class 1-A-1, Class
1-A-26, Class 1-A-29 and
Class 1-A-37
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-1E $19,110,000(3) 6.75%-LIBOR Class 1-A-1, Class
1-A-26, Class 1-A-28 and
Class 1-A-37
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-2 $44,773,000 6.00% Class 1-A-2
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-3 $2,900,000 6.00% Class 1-A-3
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-4 $216,407,000 6.00% Class 1-A-4
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-5 $25,000,000(3) (6) Class 1-A-5
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-6 $25,000,000 (7) Class 1-A-6
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-7 $29,000 6.00% Class 1-A-7
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-8 $29,000 6.00% Class 1-A-8
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-9 $22,415,000 6.00% Class 1-A-9
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-10A $227,162,000 5.50% Class 1-A-10, Class
1-A-31, Class 1-A-34 and
Class 1-A-37
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-10B $68,148,000 LIBOR + .25% Class 1-A-10, Class
1-A-33, Class 1-A-36 and
Class 1-A-37
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-10C $45,433,000 LIBOR + .25% Class 1-A-10, Class
1-A-33,
------------------------- ----------------------- ----------------------- ---------------------------
8
------------------------- ----------------------- ----------------------- ---------------------------
Class 1-A-34 and
Class 1-A-37
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-10D $68,148,000(3) 6.75%-LIBOR Class 1-A-10, Class
1-A-32, Class 1-A-35 and
Class 1-A-37
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-10E $45,433,000(3) 6.75%-LIBOR Class 1-A-10, Class
1-A-32, Class 1-A-34 and
Class 1-A-37
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-11 $12,240,000 6.00% Class 1-A-11
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-12 $6,190,000 6.00% Class 1-A-12
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-13 $33,540,000 6.00% Class 1-A-13
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-14 $60,000,000(3) (12) Class 1-A-14
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-15 $60,000,000 (13) Class 1-A-15
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-16 $46,423,000 6.00% Class 1-A-16
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-17 $61,000 6.00% Class 1-A-17
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-18 $275,640,000(3) (14) Class 1-A-18
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-19 $275,640,000 (15) Class 1-A-19
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-20 $100,000,000(3) (16) Class 1-A-20
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-21 $100,000,000 (17) Class 1-A-21
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-22 $30,000,000(3) (18) Class 1-A-22
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-23 $30,000,000 (19) Class 1-A-23
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-A-24 $2,094,000 (20) Class 1-A-24
------------------------- ----------------------- ----------------------- ---------------------------
MR-1-X (21) (21) Class 1-X
------------------------- ----------------------- ----------------------- ---------------------------
MR-2-A-1 $60,561,000 6.00% Class 2-A-1
------------------------- ----------------------- ----------------------- ---------------------------
MR-2-A-2 $950,000 6.00% Class 2-A-2
------------------------- ----------------------- ----------------------- ---------------------------
MR-2-A-3 $27,882,000 6.00% Class 2-A-3
------------------------- ----------------------- ----------------------- ---------------------------
MR-2-A-4 $50,000,000(3) (22) Class 2-A-4
------------------------- ----------------------- ----------------------- ---------------------------
MR-2-A-5 $50,000,000 (23) Class 2-A-5
------------------------- ----------------------- ----------------------- ---------------------------
9
------------------------- ----------------------- ----------------------- ---------------------------
MR-2-A-6 $10,000 6.00% Class 2-A-6
------------------------- ----------------------- ----------------------- ---------------------------
MR-2-A-7 $9,000 6.00% Class 2-A-7
------------------------- ----------------------- ----------------------- ---------------------------
MR-2-X (24) (24) Class 2-X
------------------------- ----------------------- ----------------------- ---------------------------
MR-PO $240,436 (20) Class PO
------------------------- ----------------------- ----------------------- ---------------------------
MR-A-R(25) $100.00 6.00% Class A-R
------------------------- ----------------------- ----------------------- ---------------------------
MR-M $33,927,000 6.00% Class M
------------------------- ----------------------- ----------------------- ---------------------------
MR-B-1 $14,202,000 6.00% Class B-1
------------------------- ----------------------- ----------------------- ---------------------------
MR-B-2 $10,256,900 6.00% Class B-2
------------------------- ----------------------- ----------------------- ---------------------------
MR-B-3 $7,101,000 6.00% Class B-3
------------------------- ----------------------- ----------------------- ---------------------------
MR-B-4 $6,312,000 6.00% Class B-4
------------------------- ----------------------- ----------------------- ---------------------------
MR-B-5 $4,734,029.33 6.00% Class B-5
------------------------- ----------------------- ----------------------- ---------------------------
(1) The MR-1-A-1B Master REMIC Interest will bear interest during each
Interest Accrual Period at a per annum rate of LIBOR plus 0.25%, subject
to a maximum and minimum rate of 7.00% and 0.25% per annum,
respectively.
(2) The MR-1-A-1C Master REMIC Interest will bear interest during each
Interest Accrual Period at a per annum rate of LIBOR plus 0.25%, subject
to a maximum and minimum rate of 7.00% and 0.25% per annum,
respectively.
(3) This class of Master REMIC Interest will have no principal balance, pays
no principal and will bear interest on its Notional Amount.
(4) The MR-1-A-1D Master REMIC Interest will bear interest during each
Interest Accrual Period at a per annum rate of 6.75% minus LIBOR,
subject to a maximum and minimum rate of 6.75% and 0.00% per annum,
respectively.
(5) The MR-1-A-1E Master REMIC Interest will bear interest during each
Interest Accrual Period at a per annum rate of 6.75% minus LIBOR,
subject to a maximum and minimum rate of 6.75% and 0.00% per annum,
respectively.
(6) The MR-1-A-5 Master REMIC Interest will bear interest during each
Interest Accrual Period at a per annum rate of 5.40% minus LIBOR,
subject to a maximum and minimum rate of 5.40% and 0.00% per annum,
respectively.
(7) The MR-1-A-6 Master REMIC Interest will bear interest during each
Interest Accrual Period at a per annum rate of LIBOR plus 0.60%, subject
to a maximum and minimum rate of 6.00% and 0.60% per annum,
respectively.
10
(8) The MR-1-A-10B Master REMIC Interest will bear interest during each
Interest Accrual Period at a per annum rate of LIBOR plus 0.25%, subject
to a maximum and minimum rate of 6.00% and 0.25% per annum,
respectively.
(9) The MR-1-A-10C Master REMIC Interest will bear interest during each
Interest Accrual Period at a per annum rate of LIBOR plus 0.25%, subject
to a maximum and minimum rate of 6.00% and 0.25% per annum,
respectively.
(10) The MR-1-A-10D Master REMIC Interest will bear interest during each
Interest Accrual Period at a per annum rate of 6.75% minus LIBOR,
subject to a maximum and minimum rate of 6.75% and 0.00% per annum,
respectively.
(11) The MR-1-A-10E Master REMIC Interest will bear interest during each
Interest Accrual Period at a per annum rate of 6.75% minus LIBOR,
subject to a maximum and minimum rate of 6.75% and 0.00% per annum,
respectively.
(12) The MR-1-A-14 Master REMIC Interest will bear interest during each
Interest Accrual Period at a per annum rate of 5.35% minus LIBOR,
subject to a maximum and minimum rate of 5.35% and 0.00% per annum,
respectively.
(13) The MR-1-A-15 Master REMIC Interest will bear interest during each
Interest Accrual Period at a per annum rate of LIBOR plus 0.40%, subject
to a maximum and minimum rate of 5.75% and 0.40% per annum,
respectively.
(14) The MR-1-A-18 Master REMIC Interest will bear interest during each
Interest Accrual Period at a per annum rate of 5.65% minus LIBOR,
subject to a maximum and minimum rate of 5.65% and 0.00% per annum,
respectively.
(15) The MR-1-A-19 Master REMIC Interest will bear interest during each
Interest Accrual Period at a per annum rate of LIBOR plus 0.45%, subject
to a maximum and minimum rate of 6.10% and 0.45% per annum,
respectively.
(16) The MR-1-A-20 Master REMIC Interest will bear interest during each
Interest Accrual Period at a per annum rate of 5.46% minus LIBOR,
subject to a maximum and minimum rate of 5.46% and 0.00% per annum,
respectively.
(17) The MR-1-A-21 Master REMIC Interest will bear interest during each
Interest Accrual Period at a per annum rate of LIBOR plus 0.54%, subject
to a maximum and minimum rate of 6.00% and 0.54% per annum,
respectively.
(18) The MR-1-A-22 Master REMIC Interest will bear interest during each
Interest Accrual Period at a per annum rate of 5.45% minus LIBOR,
subject to a maximum and minimum rate of 5.45% and 0.00% per annum,
respectively.
(19) The MR-1-A-23 Master REMIC Interest will bear interest during each
Interest Accrual Period at a per annum rate of LIBOR plus 0.55%, subject
to a maximum and minimum rate of 6.00% and 0.55% per annum,
respectively.
(20) This class of Master REMIC Interest pays no interest.
11
(21) The MR-1-X Master REMIC Interest is entitled to receive on each
Distribution Date all amounts payable with respect to the LTR-1-X Lower
Tier REMIC Interest.
(22) The MR-2-A-4 Master REMIC Interest will bear interest during each
Interest Accrual Period at a per annum rate of 5.48% minus LIBOR,
subject to a maximum and minimum rate of 5.48% and 0.00% per annum,
respectively.
(23) The MR-2-A-5 Master REMIC Interest will bear interest during each
Interest Accrual Period at a per annum rate of LIBOR plus 0.52%, subject
to a maximum and minimum rate of 6.00% and 0.52% per annum,
respectively.
(24) The MR-2-X Master REMIC Interest is entitled to receive on each
Distribution Date all amounts payable with respect to the LTR-2-X Lower
Tier REMIC Interest.
(25) The Class MR-A-R Master REMIC Interest represents the sole class of
residual interest in the Master REMIC.
12
The following table specifies the class designation, interest rate, and
principal amount for each class of Lower Tier REMIC Interests:
------------------------- ----------------------- ----------------------- ---------------------------
Lower Tier REMIC Initial Principal Corresponding Master
Interest Designation Balance Interest Rate REMIC Interest
-------------------- ------- ------------- --------------
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-1A $95,550,000 5.50% MR-1-A-1A
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-1B $28,665,000 7.00% MR-A-1B and MR-1-A-1D(1)
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-1C $19,110,000 7.00% MR-A-1C and MR-1-A-1E(2)
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-2 $44,773,000 6.00% MR-1-A-2
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-3 $2,900,000 6.00% MR-1-A-3
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-4 $216,407,000 6.00% MR-1-A-4
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-6 $25,000,000 6.00% MR-1-A-6 and MR-1-A-5(3)
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-7 $29,000 6.00% MR-1-A-7
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-8 $29,000 6.00% MR-1-A-8
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-9 $22,415,000 6.00% MR-1-A-9
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-10A $227,162,000 5.50% MR-1-A-10A
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-10B $68,148,000 7.00% MR-A-10B and MR-1-A-10D(4)
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-10C $45,433,000 7.00% MR-A-10C and MR-1-A-10E(5)
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-11 $12,240,000 6.00% MR-1-A-11
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-12 $6,190,000 6.00% MR-1-A-12
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-13 $33,540,000 6.00% MR-1-A-13
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-15 $60,000,000 6.00% MR-1-A-15 and MR-1-A-14(6)
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-16 $46,423,000 6.00% MR-1-A-16
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-17 $61,000 6.00% MR-1-A-17
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-19 $275,640,000 6.10% MR-1-A-19 and MR-1-A-
------------------------- ----------------------- ----------------------- ---------------------------
13
------------------------- ----------------------- ----------------------- ---------------------------
18(7)
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-21 $100,000,000 6.00% MR-1-A-21 and MR-1-A-20(8)
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-23 $30,000,000 6.00% MR-1-A-23 and MR-1-A-22(9)
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-A-24 $2,094,000 (10) MR-1-A-24
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-X (11) (11) MR-1-X
------------------------- ----------------------- ----------------------- ---------------------------
LTR-1-$100 $100 6.00% MR-A-R
------------------------- ----------------------- ----------------------- ---------------------------
LTR-2-A-1 $60,561,000 6.00% MR-2-A-1
------------------------- ----------------------- ----------------------- ---------------------------
LTR-2-A-2 $950,000 6.00% MR-2-A-2
------------------------- ----------------------- ----------------------- ---------------------------
LTR-2-A-3 $27,882,000 6.00% MR-2-A-3
------------------------- ----------------------- ----------------------- ---------------------------
LTR-2-A-5 $50,000,000 6.00% MR-2-A-5 and MR-2-A-4(12)
------------------------- ----------------------- ----------------------- ---------------------------
LTR-2-A-6 $10,000 6.00% MR-2-A-6
------------------------- ----------------------- ----------------------- ---------------------------
LTR-2-A-7 $9,000 6.00% MR-2-A-7
------------------------- ----------------------- ----------------------- ---------------------------
LTR-2-X (13) (13) MR-2-X
------------------------- ----------------------- ----------------------- ---------------------------
LTR-PO $240,436 (10) MR-PO
------------------------- ----------------------- ----------------------- ---------------------------
LTR-A-R (14) (14) N/A
------------------------- ----------------------- ----------------------- ---------------------------
LTR-M $33,927,000 6.00% MR-M
------------------------- ----------------------- ----------------------- ---------------------------
LTR-B-1 $14,202,000 6.00% MR-B-1
------------------------- ----------------------- ----------------------- ---------------------------
LTR-B-2 $10,256,900 6.00% MR-B-2
------------------------- ----------------------- ----------------------- ---------------------------
LTR-B-3 $7,101,000 6.00% MR-B-3
------------------------- ----------------------- ----------------------- ---------------------------
LTR-B-4 $6,312,000 6.00% MR-B-4
------------------------- ----------------------- ----------------------- ---------------------------
LTR-B-5 $4,734,029.33 6.00% MR-B-5
------------------------- ----------------------- ----------------------- ---------------------------
(1) For each Distribution Date, this class of Master REMIC Interest is
entitled to a portion of the interest payable on the class LTR -1-A-1B
Lower Tier REMIC Interest. Specifically, for each Distribution Date,
this Master REMIC Interest is entitled to the interest payable on the
class LTR -1-A-1B Lower Tier REMIC Interest at a per annum rate equal to
6.75% minus LIBOR.
14
(2) For each Distribution Date, this class of Master REMIC Interest is
entitled to a portion of the interest payable on the class LTR -1-A-1C
Lower Tier REMIC Interest. Specifically, for each Distribution Date,
this Master REMIC Interest is entitled to the interest payable on the
class LTR -1-A-1C Lower Tier REMIC Interest at a per annum rate equal to
6.75% minus LIBOR.
(3) For each Distribution Date, this class of Master REMIC Interest is
entitled to a portion of the interest payable on the class LTR -1-A-6
Lower Tier REMIC Interest. Specifically, for each Distribution Date,
this Master REMIC Interest is entitled to the interest payable on the
class LTR -1-A-6 Lower Tier REMIC Interest at a per annum rate equal to
5.40% minus LIBOR.
(4) For each Distribution Date, this class of Master REMIC Interest is
entitled to a portion of the interest payable on the class LTR -1-A-10B
Lower Tier REMIC Interest. Specifically, for each Distribution Date,
this Master REMIC Interest is entitled to the interest payable on the
class LTR -1-A-10B Lower Tier REMIC Interest at a per annum rate equal
to 6.75% minus LIBOR.
(5) For each Distribution Date, this class of Master REMIC Interest is
entitled to a portion of the interest payable on the class LTR -1-A-10C
Lower Tier REMIC Interest. Specifically, for each Distribution Date,
this Master REMIC Interest is entitled to the interest payable on the
class LTR -1-A-10C Lower Tier REMIC Interest at a per annum rate equal
to 6.75% minus LIBOR.
(6) For each Distribution Date, this class of Master REMIC Interest is
entitled to a portion of the interest payable on the class LTR -1-A-15
Lower Tier REMIC Interest. Specifically, for each Distribution Date,
this Master REMIC Interest is entitled to the interest payable on the
class LTR -1-A-15 Lower Tier REMIC Interest at a per annum rate equal to
5.35% minus LIBOR.
(7) For each Distribution Date, this class of Master REMIC Interest is
entitled to a portion of the interest payable on the class LTR -1-A-18
Lower Tier REMIC Interest. Specifically, for each Distribution Date,
this Master REMIC Interest is entitled to the interest payable on the
class LTR -1-A-18 Lower Tier REMIC Interest at a per annum rate equal to
5.65% minus LIBOR.
(8) For each Distribution Date, this class of Master REMIC Interest is
entitled to a portion of the interest payable on the class LTR -1-A-20
Lower Tier REMIC Interest. Specifically, for each Distribution Date,
this Master REMIC Interest is entitled to the interest payable on the
class LTR -1-A-20 Lower Tier REMIC Interest at a per annum rate equal to
5.46% minus LIBOR.
(9) For each Distribution Date, this class of Master REMIC Interest is
entitled to a portion of the interest payable on the class LTR -1-A-22
Lower Tier REMIC Interest. Specifically, for each Distribution Date,
this Master REMIC Interest is entitled to the interest payable on the
class LTR -1-A-22 Lower Tier REMIC Interest at a per annum rate equal to
5.45% minus LIBOR.
(10) This Class of Lower Tier REMIC Interest pays no interest.
(11) The LTR-1-X Lower Tier REMIC Interest is entitled to receive on each
Distribution Date a specified portion of the interest payable on each
Non-Discount Mortgage Loan in Loan Group 1 equal to all of the interest
payable on such mortgage loan in excess of an Adjusted Net Mortgage Rate
of 6.00%.
(12) For each Distribution Date, this class of Master REMIC Interest is
entitled to a portion of the interest payable on the class LTR -2-A-5
Lower Tier REMIC Interest. Specifically, for each Distribution Date,
this Master REMIC Interest is entitled to the interest payable on the
class LTR -2-A-5 Lower Tier REMIC Interest at a per annum rate equal to
5.48% minus LIBOR.
15
(13) The LTR-2-X Lower Tier REMIC Interest is entitled to receive on each
Distribution Date a specified portion of the interest payable on each
Non-Discount Mortgage Loan in Loan Group 2 equal to all of the interest
payable on such mortgage loan in excess of an Adjusted Net Mortgage Rate
of 6.00%.
(14) The Class LTR-A-R Lower Tier REMIC Interest represents the sole class of
residual interest in the Lower Tier REMIC. It pays no interest or
principal.
On each Distribution Date, the Available Funds shall be distributed with
respect to the Lower Tier REMIC Interests in the following manner:
(1) Interest is to be distributed with respect to each Lower Tier REMIC
Interest at the rate, or according to the formulas, described above; and
(2) Principal is to be distributed with respect to each Lower Tier REMIC
Interest in the same manner and in the same amount as principal is distributed
with respect to its Corresponding Master REMIC Interest.
On each Distribution Date, Realized Losses (and increases in Principal
Balances attributable to Subsequent Recoveries) shall be allocated among the
Lower Tier REMIC Interests in the same manner that Realized Losses (and
increases in Class Certificate Balances attributable to Subsequent Recoveries)
are allocated among each Lower Tier REMIC Interest's Corresponding Class or
Classes of Certificates.
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.
16
Set forth below are designations of Classes or Components of
Certificates and other defined terms to the categories used herein:
Accretion Directed Certificates........... Class 1-A-6, Class 1-A-7, Class 1-A-15, Class 1-A-16, Class 1-A-19,
Class 1-A-21, Class 1-A-23, Class
1-A-24, Class 2-A-5 and Class
2-A-6 Certificates.
Accretion Directed Components............. None.
Accrual Certificates...................... Class 1-A-7, Class 1-A-8, Class 1-A-16, Class 1-A-17, Class 2-A-6 and
Class 2-A-7 Certificates.
Accrual Components........................ None.
Book-Entry Certificates................... All Classes of Certificates other than the Physical Certificates.
COFI Certificates......................... None.
Combined Certificates..................... None.
Component Certificates.................... Class PO Certificates.
Components................................ For purposes of calculating
distributions of principal and/or
interest, the Component
Certificates, if any, will be
comprised of multiple payment
components having the
designations, Initial Component
Balances or Notional Amounts, as
applicable, and Pass-Through Rates
set forth below:
Initial
Designation Component Balance Pass-Through Rate
----------- ----------------- -----------------
Class PO-1 Component $222,403 (1)
Class PO-2 Component $18,033 (1)
(1) This component does not bear interest.
Delay Certificates........................ All interest-bearing Classes of Certificates other than the Non-Delay
Certificates, if any.
Depositable Certificates.................. Class 1-A-1, Class 1-A-2 and Class 1-A-10 Certificates
ERISA-Restricted Certificates............. The Residual Certificates and Private Certificates; until an
ERISA-Qualifying Underwriting has occurred with respect to such
Class, the Class PO, Class 1-X and Class 2-X Certificates; and any
Certificate of a Class that does not have or no longer has a rating
of at least BBB- or its equivalent from at least one Rating Agency.
Exchangeable Certificates................. Class 1-A-25, Class 1-A-26, Class 1-A-27, Class 1-A-28, Class 1-A-29,
Class 1-A-30, Class 1-A-31, Class 1-A-32, Class 1-A-
17
33, Class 1-A-34, Class 1-A-35, Class 1-A-36 and Class 1-A-37
Certificates.
Floating Rate Certificates................ Class 1-A-6, Class 1-A-15, Class 1-A-19, Class 1-A-21, Class 1-A-23,
Class 1-A-27, Class 1-A-30, Class
1-A-33, Class 1-A-36 and Class
2-A-5 Certificates.
Group 1 Certificates...................... Group 1 Senior Certificates and the portions of the Subordinated
Certificates related to Loan Group 1.
Group 1 Senior Certificates............... Class 1-A-1, Class 1-A-2, Class 1-A-3, Class 1-A-4, Class
1-A-5, Class 1-A-6, Class 1-A-7, Class 1-A-8, Class 1-A-9, Class
1-A-10, Class 1-A-11, Class 1-A-12, Class 1-A-13, Class 1-A-14, Class
1-A-15, Class 1-A-16, Class 1-A-17, Class 1-A-18, Class 1-A-19, Class
1-A-20, Class 1-A-21, Class 1-A-22, Class 1-A-23, Class 1-A-24 and
Class 1-X Certificates and Class PO-1 Component.
Group 2 Certificates...................... Group 2 Senior Certificates and the portions of the Subordinated
Certificates related to Loan Group 2.
Group 2 Senior Certificates.................Class 2-A-1, Class 2-A-2, Class 2-A-3, Class 2-A-4, Class 2-A-5,
Class 2-A-6, Class 2-A-7, Class 2-X and Class A-R Certificates and
Class PO-2 Component
Inverse Floating Rate Certificates........ Class 1-A-5, Class 1-A-14, Class
1-A-18, Class 1-A-20, Class
1-A-22, Class 1-A-26, Class
1-A-29, Class 1-A-32, Class 1-A-35
and Class 2-A-4 Certificates.
LIBOR Certificates........................ Floating Rate Certificates and Inverse Floating Rate Certificates.
Non-Delay Certificates.................... LIBOR Certificates.
Notional Amount Certificates.............. Class 1-A-5, Class 1-A-14, Class 1-A-18, Class 1-A-20, Class 1-A-22,
Class 1-A-26, Class 1-A-29, Class 1-A-32, Class 1-A-35, Class 2-A-4,
Class 1-X and Class 2-X Certificates.
Notional Amount Components................ None.
Offered Certificates...................... All Classes of Certificates other than the Private Certificates.
Physical Certificates..................... Private Certificates and the Residual Certificates.
Planned Principal Classes................. Class 1-A-1, Class 1-A-2, Class 1-A-10, Class 1-A-11 and Class 2-A-1
Certificates.
Principal Only Certificates............... Class 1-A-24 and PO Certificates.
Private Certificates...................... Class B-3, Class B-4 and Class B-5 Certificates.
Rating Agencies........................... Fitch, Xxxxx'x and S&P.
18
Regular Certificates...................... All Classes of Certificates, other than the Residual Certificates.
Residual Certificates..................... Class A-R Certificates.
Scheduled Principal Classes............... None.
Senior Certificate Group.................. The Group 1 Senior Certificates and the Group 2 Senior Certificates,
as applicable.
Senior Certificates....................... The Group 1 Senior Certificates and Group 2 Senior Certificates.
Subordinated Certificates ................ Class M, Class B-1, Class B-2, Class B-3, Class B-4 and Class B-5
Certificates.
Targeted Principal Classes................ Class 1-A-6, Class 1-A-15, Class 1-A-19, Class 1-A-21, Class 1-A-23,
Class 1-A-24 and Class 2-A-5 Certificates.
Underwriter............................... Each of Citigroup Global Markets
Inc. (Senior) and Countrywide
Securities Corporation.
With respect to any of the foregoing designations as to which the
corresponding reference is "None," all defined terms and provisions herein
relating solely to such designations shall be of no force or effect, and any
calculations herein incorporating references to such designations shall be
interpreted without reference to such designations and amounts. Defined terms
and provisions herein relating to statistical rating agencies not designated
above as Rating Agencies shall be of no force or effect.
19
ARTICLE I
DEFINITIONS
SECTION 1.01. Defined Terms
Whenever used in this Agreement, the following words and phrases, unless the
context otherwise requires, shall have the following meanings:
Account: Any Escrow Account, the Certificate Account, the
Distribution Account, the Corridor Contract Reserve Fund, the Exchangeable
Certificates Distribution Account or any other account related to the Trust
Fund or the Mortgage Loans.
Accretion Directed Certificates: As specified in the Preliminary
Statement.
Accretion Direction Rule: The Class 1-A-7 Accretion Direction
Rule, the Class 1-A-8 Accretion Direction Rule, the Class 1-A-16 Accretion
Direction Rule, the Class 1-A-17 Accretion Direction Rule, the Class 2-A-6
Accretion Direction Rule or Class 2-A-7 Accretion Direction Rule, as
applicable.
Accrual Amount: With respect to any Class of Accrual Certificates
or any Accrual Component and any Distribution Date prior to the related
Accrual Termination Date, the amount allocable to interest on such Class of
Accrual Certificates or Accrual Component with respect to such Distribution
Date pursuant to Section 4.02(a).
Accrual Certificates: As specified in the Preliminary Statement.
Accrual Components: As specified in the Preliminary Statement.
Accrual Termination Date: The Class 1-A-7 Accrual Termination
Date, the Class 1-A-8 Accrual Termination Date, the Class 1-A-16 Accrual
Termination Date, the Class 1-A-17 Accrual Termination Date, the Class 2-A-6
Accrual Termination Date or the Class 2-A-7 Accrual Termination Date, as
applicable.
Additional Designated Information: As defined in Section 11.02.
Adjusted Mortgage Rate: As to each Mortgage Loan, and at any time,
the per annum rate equal to the Mortgage Rate less the Master Servicing Fee
Rate.
Adjusted Net Mortgage Rate: As to each Mortgage Loan, and at any
time, the per annum rate equal to the Mortgage Rate less the sum of the
Trustee Fee Rate and the Master Servicing Fee Rate. For purposes of
determining whether any Substitute Mortgage Loan is a Discount Mortgage Loan
or a Non-Discount Mortgage Loan and for purposes of calculating the applicable
PO Percentage and the applicable Non-PO Percentage, each Substitute Mortgage
Loan shall be deemed to have an Adjusted Net Mortgage Rate equal to the
Adjusted Net Mortgage Rate of the Deleted Mortgage Loan for which it is
substituted.
Advance: 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 on the related Due Date and not
received by the
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Master Servicer as of the close of business on the related Determination Date,
together with an amount equivalent to interest on each Mortgage Loan as to
which the related Mortgaged Property is an REO Property (net of any net income
from such REO Property), less the aggregate amount of any such delinquent
payments that the Master Servicer has determined would constitute a
Nonrecoverable Advance, if advanced.
Aggregate Planned Balance: With respect to any group of Planned
Principal Classes or Components and any Distribution Date, the amount set
forth for such group for such Distribution Date in Schedule V hereto.
Aggregate Scheduled Balance: With respect to any group of
Scheduled Principal Classes or Components and any Distribution Date, the
amount set forth for such group for such Distribution Date in Schedule V
hereto.
Aggregate Targeted Balance: With respect to any group of Targeted
Principal Classes or Components and any Distribution Date, the amount set
forth for such group for such Distribution Date in Schedule V hereto.
Agreement: This Pooling and Servicing Agreement and all
amendments or supplements hereto.
Allocable Share: As to any Distribution Date and any Mortgage Loan
(i) with respect to each Class PO Component, zero, (ii) with respect to the
Class 1-X and Class 2-X Certificates, (a) the ratio that the excess, if any,
of the Adjusted Net Mortgage Rate with respect to such Mortgage Loan, over the
related Required Coupon bears to such Adjusted Net Mortgage Rate or (b) if the
Adjusted Net Mortgage Rate with respect to such Mortgage Loan does not exceed
the related Required Coupon, zero and (iii) with respect to each other Class
of Certificates the product of (a) the lesser of (I) the ratio that the
related Required Coupon bears to the Adjusted Net Mortgage Rate of such
Mortgage Loan and (II) one, multiplied by (b) the ratio that the amount
calculated with respect to such Distribution Date (A) with respect to the
Senior Certificates of the related Senior Certificate Group (other than the
related Class PO Component), 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
Subordinated Certificates, pursuant to the definition of Assumed Interest
Amount or after a Senior Termination Date 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 amount calculated with respect to such Distribution Date for each Class of
Certificates pursuant to clause (i) of the definition of Class Optimal
Interest Distribution Amount (without giving effect to any reduction of such
amount pursuant to Section 4.02(d)) or the definition of Assumed Interest
Amount, as applicable.
Amount Available for Senior Principal: As to any Distribution Date
and (a) Loan Group 1, the Available Funds for such Distribution Date and Loan
Group, reduced by the aggregate amount distributable (or allocable to the
Accrual Amount, if applicable) on such Distribution Date in respect of
interest on the related Senior Certificates pursuant to Section 4.02(a)(1)(ii)
and (b) Loan Group 2, the Available Funds for such Distribution Date and Loan
Group, reduced by the aggregate amount distributable (or allocable to the
Accrual Amount, if applicable) on such Distribution Date in respect of
interest on the related Senior Certificates pursuant to Section
4.02(a)(2)(ii).
Amount Held for Future Distribution: As to any Distribution Date
and the 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
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Distribution Date relating to such Loan Group and (ii) all Scheduled Payments
due after the related Due Date relating to such Loan Group.
Applicable Credit Support Percentage: As defined in Section
4.02(e).
Appraised Value: With respect to any Mortgage Loan, the Appraised
Value of the related Mortgaged Property shall be: (i) with respect to a
Mortgage Loan other than a Refinancing Mortgage Loan, the lesser of (a) the
value of the Mortgaged Property based upon the appraisal made at the time of
the origination of such Mortgage Loan and (b) the sale price of the Mortgaged
Property at the time of the origination of such Mortgage Loan; (ii) with
respect to a Refinancing Mortgage Loan other than a Streamlined Documentation
Mortgage Loan, the value of the Mortgaged Property based upon the appraisal
made-at the time of the origination of such Refinancing Mortgage Loan; and
(iii) with respect to a Streamlined Documentation Mortgage Loan, (a) if the
loan-to-value ratio with respect to the Original Mortgage Loan at the time of
the origination thereof was 80% or less and the loan amount of the new
mortgage loan is $650,000 or less, the value of the Mortgaged Property based
upon the appraisal made at the time of the origination of the Original
Mortgage Loan and (b) if the loan-to-value ratio with respect to the Original
Mortgage Loan at the time of the origination thereof was greater than 80% or
the loan amount of the new loan being originated is greater than $650,000, the
value of the Mortgaged Property based upon the appraisal (which may be a
drive-by appraisal) made at the time of the origination of such Streamlined
Documentation Mortgage Loan.
Assumed Balance: For a Distribution Date and Loan Group, an amount
equal to the Subordinated Percentage for that Distribution Date relating to
that Loan Group of the aggregate of the applicable Non-PO Percentage of the
Stated Principal Balance of each Mortgage Loan in such Loan Group as of the
Due Date occurring in the month prior to the month of that Distribution Date
(after giving effect to Principal Prepayments received in the Prepayment
Period related to such Due Date).
Assumed Interest Amount: With respect to any Distribution Date and
each Class of Subordinated Certificates, one month's interest accrued during
the related Interest Accrual Period at the Pass-Through Rate for such Class on
the applicable Assumed Balance immediately prior to that Distribution Date.
Available Funds: As to any Distribution Date and the Mortgage
Loans in a Loan Group, the sum of (a) the aggregate amount held in the
Certificate Account at the close of business on the related Determination
Date, including any Subsequent Recoveries, in respect of such Mortgage Loans,
net of the related Amount Held for Future Distribution and net of amounts
permitted to be withdrawn from the Certificate Account pursuant to clauses (i)
- (viii), inclusive, of Section 3.08(a) in respect of such Mortgage Loans and
amounts permitted to be withdrawn from the Distribution Account pursuant to
clauses (i) - (v), inclusive, of Section 3.08(b) in respect of such Mortgage
Loans, (b) the amount of the related Advance and (c) in connection with
Defective Mortgage Loans in such Loan Group, as applicable, the aggregate of
the Purchase Prices and Substitution Adjustment Amounts deposited on the
related Distribution Account Deposit Date; provided, however, that on a 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 Group after all distributions are made on the Senior
Certificates of the other Senior Certificate Group and on any Distribution
Date thereafter, Available Funds shall be calculated based upon all the
Mortgage Loans in the Mortgage Pool, as opposed to the Mortgage Loans in the
related Loan Group.
Bankruptcy Code: The United States Bankruptcy Reform Act of
1978, as amended.
Book-Entry Certificates: As specified in the Preliminary
Statement.
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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.
Ceiling Rate: With respect to each Class of Covered
Certificates, the applicable percentages set forth below:
-------------------------------------------
Class of Certificates Ceiling Rate
--------------------- ------------
-------------------------------------------
Class 1-A-6 8.90%
-------------------------------------------
Class 1-A-15 9.10%
-------------------------------------------
Class 1-A-19 9.05%
-------------------------------------------
Class 1-A-21 8.96%
-------------------------------------------
Class 1-A-23 8.95%
-------------------------------------------
Class 2-A-5 8.98%
-------------------------------------------
Certificate: Any one of the Certificates executed by the Trustee
in substantially the forms attached hereto as exhibits.
Certificate Account: The separate Eligible Account or Accounts
created and maintained by the Master Servicer pursuant to Section 3.05 with a
depository institution, initially Countrywide Bank, N.A., 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 2007-5CB, Mortgage Pass-Through
Certificates, Series 2007-5CB."
Certificate Balance: With respect to any Certificate at any date
(other than the Notional Amount Certificates), the maximum dollar amount of
principal to which the Holder thereof is then entitled hereunder, such amount
being equal to the Denomination thereof (A) plus any increase in the
Certificate Balance of each Certificate pursuant to Section 4.02 due to the
receipt of Subsequent Recoveries, (B) minus the sum of (i) all distributions
of principal previously made with respect thereto and (ii) all Realized Losses
allocated thereto and, in the case of the Subordinated Certificates, all other
reductions in Certificate Balance previously allocated thereto pursuant to
Section 4.04 and (C) in the case of any Class of Accrual Certificates,
increased by the Accrual Amount added to the Class Certificate Balance of such
Class prior to such date. The Notional Amount Certificates have no Certificate
Balances.
Certificate Group: The Group 1 Certificates or the Group 2
Certificates, as the context requires.
Certificate Owner: With respect to a Book-Entry Certificate, the
Person who is the beneficial owner of such Book-Entry Certificate. For the
purposes of this Agreement, in order for a Certificate Owner to enforce any of
its rights hereunder, it shall first have to provide evidence of its
beneficial ownership interest in a Certificate that is reasonably satisfactory
to the Trustee, the Depositor, and/or the Master Servicer, as applicable.
Certificate Register: The register maintained pursuant to
Section 5.02 hereof.
Certificateholder or Holder: The person in whose name a
Certificate is registered in the Certificate Register, except that, solely for
the purpose of giving any consent pursuant to this Agreement, any Certificate
registered in the name of the Depositor or any affiliate of the Depositor
shall be deemed
I-4
not to be Outstanding and the Percentage Interest evidenced thereby shall not
be taken into account in determining whether the requisite amount of
Percentage Interests necessary to effect such consent has been obtained;
provided, however, that if any such Person (including the Depositor) owns 100%
of the Percentage Interests evidenced by a Class of Certificates, such
Certificates shall be deemed to be Outstanding for purposes of any provision
hereof (other than the second sentence of Section 10.01 hereof) that requires
the consent of the Holders of Certificates of a particular Class as a
condition to the taking of any action hereunder. The Trustee is entitled to
rely conclusively on a certification of the Depositor or any affiliate of the
Depositor in determining which Certificates are registered in the name of an
affiliate of the Depositor.
Certification Party: As defined in Section 11.05.
Certifying Person: As defined in Section 11.05.
Class: All Certificates bearing the same class designation as
set forth in the Preliminary Statement.
Class 1-A-7 Accretion Direction Rule: On each Distribution Date up
to and including the Class 1-A-7 Accrual Termination Date, the Accrual Amount
for the Class 1-A-7 Certificates will be distributed as principal in the
following order:
(1) concurrently, to the Class 1-A-6, Class 1-A-21 and Class 1-A-23
Certificates, pro rata, in an amount up to the amount necessary to
reduce their aggregate Class Certificate Balance to the Aggregate
Targeted Balance for that Distribution Date, after giving effect to the
distributions of accrued interest on the Class 1-A-8 Certificates; and
(2) to the Class 1-A-7 Certificates, until its Class Certificate
Balance is reduced to zero.
Class 1-A-7 Accrual Termination Date: The earlier of the Senior
Credit Support Depletion Date and the Distribution Date on which the aggregate
Class Certificate Balance of the Class 1-A-6, Class 1-A-21 and Class 1-A-23
Certificates is reduced to zero.
Class 1-A-8 Accretion Direction Rule: On each Distribution Date up
to and including the Class 1-A-8 Accrual Termination Date, the Accrual Amount
for the Class 1-A-8 Certificates will be distributed as principal in the
following order:
(1) concurrently, to the Class 1-A-6, Class 1-A-21 and Class 1-A-23
Certificates, pro rata, in an amount up to the amount necessary to
reduce their aggregate Class Certificate Balance to the Aggregate
Targeted Balance
for that Distribution Date;
(2) to the Class 1-A-7 Certificates, until its Class Certificate
Balance is reduced to zero;
(3) concurrently, to the Class 1-A-6, Class 1-A-21 and Class 1-A-23
Certificates, pro rata, without regard to their Aggregate Targeted
Balance for that Distribution Date, until their respective Class
Certificate Balances are reduced to zero; and
(4) to the Class 1-A-8 Certificates, until its Class Certificate
Balance is reduced to zero.
Class 1-A-8 Accrual Termination Date: The earlier of the Senior
Credit Support Depletion Date and the Distribution Date on which the aggregate
Class Certificate Balance of the Class 1-A-6, Class 1-A-7, Class 1-A-21 and
Class 1-A-23 Certificates is reduced to zero.
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Class 1-A-16 Accretion Direction Rule: On each Distribution Date
up to and including the Class 1-A-16 Accrual Termination Date, the Accrual
Amount for the Class 1-A-16 Certificates will be distributed as principal in
the following order:
(1) concurrently, to the Class 1-A-15, Class 1-A-19 and Class 1-A-24
Certificates, pro rata, in an amount up to the amount necessary to
reduce their aggregate Class Certificate Balance to the Aggregate
Targeted Balance for that Distribution Date, after giving effect to
distributions of accrued interest on the Class 1-A-17 Certificates; and
(2) to the Class 1-A-16 Certificates, until its Class Certificate
Balance is reduced to zero.
Class 1-A-16 Accrual Termination Date: The earlier of the Senior
Credit Support Depletion Date and the Distribution Date on which the aggregate
Class Certificate Balance of the Class 1-A-15, Class 1-A-19 and Class 1-A-24
Certificates is reduced to zero.
Class 1-A-17 Accretion Direction Rule: On each Distribution Date
up to and including the Class 1-A-17 Accrual Termination Date, the Accrual
Amount for the Class 1-A-17 Certificates will be distributed as principal in
the following order:
(1) concurrently, to the Class 1-A-15, Class 1-A-19 and Class 1-A-24
Certificates, pro rata, in an amount up to the amount necessary to
reduce their aggregate Class Certificate Balance to the Aggregate
Targeted Balance
for that Distribution Date;
(2) to the Class 1-A-16 Certificates, until its Class Certificate
Balance is reduced to zero;
(3) concurrently, to the Class 1-A-15, Class 1-A-19 and Class 1-A-24
Certificates, pro rata, without regard to their Aggregate Targeted
Balance for that Distribution Date, until their respective Class
Certificate Balances are reduced to zero; and
(4) to the Class 1-A-17 Certificates, until its Class Certificate
Balance is reduced to zero.
Class 1-A-17 Accrual Termination Date: The earlier of the Senior
Credit Support Depletion Date and the Distribution Date on which the aggregate
Class Certificate Balance of the Class 1-A-15, Class 1-A-16, Class 1-A-19 and
Class 1-A-24 Certificates is reduced to zero.
Class 2-A-6 Accretion Direction Rule: On each Distribution Date up
to and including the Class 2-A-6 Accrual Termination Date, the Accrual Amount
for the Class 2-A-6 Certificates will be distributed as principal in the
following order:
(1) to the Class 2-A-5 Certificates, in an amount up to the amount
necessary to reduce its Class Certificate Balance to its Targeted
Balance for that Distribution Date, after giving effect to distributions
of accrued interest on the Class 2-A-7 Certificates; and
(2) to the Class 2-A-6 Certificates, until its Class Certificate
Balance is reduced to zero.
Class 2-A-6 Accrual Termination Date: The earlier of the Senior
Credit Support Depletion Date and the Distribution Date on which the aggregate
Class Certificate Balance of the Class 2-A-5 Certificates is reduced to zero.
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Class 2-A-7 Accretion Direction Rule: On each Distribution Date up
to and including the Class 2-A-7 Accrual Termination Date, the Accrual Amount
for the Class 2-A-7 Certificates will be distributed as principal in the
following order:
(1) to the Class 2-A-5, in an amount up to the amount necessary to
reduce its Class Certificate Balance to its Targeted Balance for that
Distribution Date;
(2) to the Class 2-A-6 Certificates, until its Class Certificate
Balance is reduced to zero;
(3) to the Class 2-A-5, without regard to its Targeted Balance for
that Distribution Date, until its Class Certificate Balances is reduced
to zero; and
(4) to the Class 2-A-7 Certificates, until its Class Certificate
Balance is reduced to zero.
Class 2-A-7 Accrual Termination Date: The earlier of the Senior
Credit Support Depletion Date and the Distribution Date on which the aggregate
Class Certificate Balance of the Class 2-A-5 and Class 2-A-6 Certificates is
reduced to zero.
Class Certificate Balance: With respect to any Class and as to any
date of determination, the aggregate of the Certificate Balances of all
Certificates of such Class as of such date.
Class Interest Shortfall: As to any Distribution Date and Class,
the amount by which the amount described in clause (i) of the definition of
Class Optimal Interest Distribution Amount for such Class exceeds the amount
of interest actually distributed on such Class on such Distribution Date
pursuant to such clause (i).
Class Optimal Interest Distribution Amount: With respect to any
Distribution Date and interest bearing Class or, with respect to any interest
bearing Component, the sum of (i) one month's interest accrued during the
related Interest Accrual Period at the Pass-Through Rate for such Class on the
related Class Certificate Balance, Component Balance, Notional Amount or
Component Notional Amount, as applicable, immediately prior to such
Distribution Date subject to reduction as provided in Section 4.02(d) and (ii)
any Class Unpaid Interest Amounts for such Class or Component. Interest on any
Class of Certificates shall be calculated on the basis of a 360-day year
consisting of twelve 30-day months.
Class PO Component: The Class PO-1 or Class PO-2 Component, as
applicable.
Class PO Deferred Amount: As to any Distribution Date and Loan
Group, the aggregate of the applicable PO Percentage of each Realized Loss on
a Discount Mortgage Loan in that Loan Group to be allocated to the related
Class PO Component on such Distribution Date on or prior to the related Senior
Credit Support Depletion Date or previously allocated to such Class PO
Component and not yet paid to the Holders of the Class PO Certificates.
Class Subordination Percentage: With respect to any Distribution
Date and each Class of Subordinated Certificates, the quotient (expressed as a
percentage) of (a) the Class Certificate Balance of such Class of Subordinated
Certificates immediately prior to such Distribution Date divided by (b) the
aggregate of the Class Certificate Balances immediately prior to such
Distribution Date of all Classes of Certificates.
Class Unpaid Interest Amounts: As to any Distribution Date and
Class of interest bearing Certificates, the amount by which the aggregate
Class Interest Shortfalls for such Class on prior
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Distribution Dates exceeds the amount distributed on such Class on prior
Distribution Dates pursuant to clause (ii) of the definition of Class Optimal
Interest Distribution Amount.
Closing Date: February 27, 2007.
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.
Combined Certificates: As specified in the Preliminary Statement.
Combined Certificates Payment Rule: Not applicable.
Commission: The U.S. Securities and Exchange Commission.
Compensating Interest: As to any Distribution Date and Loan Group
an amount equal to the product of one-twelfth of 0.125% and the aggregate
Stated Principal Balance of the Mortgage Loans in such Loan Group as of the
Due Date in the prior calendar month.
Component: As specified in the Preliminary Statement.
Component Balance: With respect to any Component and any
Distribution Date, the Initial Component Balance thereof on the Closing Date,
(A) plus any increase in the Component Balance of such Component pursuant to
Section 4.02 due to the receipt of Subsequent Recoveries, (B) minus the sum of
all amounts applied in reduction of the principal balance of such Component
and Realized Losses allocated thereto on previous Distribution Dates.
Component Certificates: As specified in the Preliminary
Statement.
Component Notional Amount: Not applicable.
Confirmation: With respect to the Class 1-A-6 Certificates, the
confirmation (reference 1286446), dated February 27, 2007, evidencing a
transaction between the Supplemental Interest Trustee and the Corridor
Contract Counterparty. With respect to the Class 1-A-15 Certificates, the
confirmation (reference 1286451), dated February 27, 2007, evidencing a
transaction between the Supplemental Interest Trustee and the Corridor
Contract Counterparty. With respect to the Class 1-A-19 Certificates, the
confirmation (reference 1286456), dated February 27, 2007, evidencing a
transaction between the Supplemental Interest Trustee and the Corridor
Contract Counterparty. With respect to the Class 1-A-21 Certificates, the
confirmation (reference 1286452), dated February 27, 2007, evidencing a
transaction between the Supplemental Interest Trustee and the Corridor
Contract Counterparty. With respect to the Class 1-A-23 Certificates, the
confirmation (reference 1286453), dated February 27, 2007, evidencing a
transaction between the Supplemental Interest Trustee and the Corridor
Contract Counterparty. With respect to the Class 2-A-5 Certificates, the
confirmation (reference 1286447), dated February 27, 2007, evidencing a
transaction between the Supplemental Interest Trustee and the Corridor
Contract Counterparty.
Coop Shares: Shares issued by a Cooperative Corporation.
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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 2007-5CB), 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: (i) the Class 1-A-6
Certificates, (ii) the Class 1-A-15 Certificates, (iii) the Class 1-A-19
Certificates, (iv) the Class 1-A-21 Certificates, (v) the Class 1-A-23
Certificates and (vi) the Class 2-A-5 Certificates, the transaction evidenced
by the related Confirmation, a form of which is attached hereto as Exhibit R.
Corridor Contract Counterparty: Swiss Re Financial Products
Corporation.
Corridor Contract Reserve Fund: The separate fund created and
initially maintained by the Supplemental Interest Trustee pursuant to Section
3.05(g) in the name of the Supplemental Interest Trustee for the benefit of
the Holders of the Covered Certificates and designated "The Bank of New York
in trust for registered holders of CWALT, Inc., Alternative Loan Trust
2007-5CB, Mortgage Pass-Through Certificates, Series 2007-5CB." Funds in the
Corridor Contract Reserve Fund shall be held in trust for the Holders of the
Covered Certificates for the uses and purposes set forth in this Agreement.
For all federal income tax purposes, the Corridor Contract Reserve Fund will
be beneficially owned by the Underwriter (Senior).
Corridor Contract Scheduled Termination Date: With respect to the
Corridor Contract related to each Class of Covered Certificates set forth
below, the applicable date set forth below:
-------------------------------------------- ----------------------
Class of Certificates Scheduled
--------------------- ---------
Termination
-----------
Date
----
-------------------------------------------- ----------------------
Class 1-A-6 June 25, 2009
-------------------------------------------- ----------------------
Class 1-A-15 October 25, 2023
-------------------------------------------- ----------------------
Class 1-A-19 June 25, 2020
-------------------------------------------- ----------------------
Class 1-A-21 January 25, 2011
-------------------------------------------- ----------------------
Class 1-A-23 January 25, 2011
-------------------------------------------- ----------------------
Class 2-A-5 October 25, 2011
-------------------------------------------- ----------------------
I-9
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.
Covered Certificates: The Class 1-A-6, Class 1-A-15, Class
1-A-19, Class 1-A-21, Class 1-A-23 and Class 2-A-5 Certificates.
Cross-Over Situation: For any Distribution Date and for each Loan
Group (after taking into account principal distributions on such Distribution
Date) with respect to the Class A and Class B Lower Tier REMIC Interests, a
situation in which the Class A and Class B Interests corresponding to any Loan
Group are in the aggregate less than 1% of the Subordinated Portion of the
Loan Group to which they correspond.
Cut-off Date: In the case of any Mortgage Loan, the later of (i)
the date of origination of such Mortgage Loan and (ii) February 1, 2007.
Cut-off Date Pool Principal Balance: $1,577,994,465.72.
Cut-off Date Principal Balance: As to any Mortgage Loan, the
Stated Principal Balance thereof as of the close of business on the Cut-off
Date.
Debt Service Reduction: With respect to any Mortgage Loan, a
reduction by a court of competent jurisdiction in a proceeding under the
Bankruptcy Code in the Scheduled Payment for such Mortgage Loan which became
final and non-appealable, except such a reduction resulting from a Deficient
Valuation or any reduction that results in a permanent forgiveness of
principal.
Defective Mortgage Loan: Any Mortgage Loan which is required to be
repurchased pursuant to Section 2.02 or 2.03.
Deficient Valuation: With respect to any Mortgage Loan, a
valuation by a court of competent jurisdiction of the Mortgaged Property in an
amount less than the then-outstanding indebtedness under the Mortgage Loan, or
any reduction in the amount of principal to be paid in connection with any
Scheduled Payment that results in a permanent forgiveness of principal, which
valuation or reduction results from an order of such court which is final and
non-appealable in a proceeding under the Bankruptcy Code.
Definitive Certificates: Any Certificate evidenced by a Physical
Certificate and any Certificate issued in lieu of a Book-Entry Certificate
pursuant to Section 5.02(e).
Delay Certificates: As specified in the Preliminary Statement.
Delay Delivery Certification: As defined in Section 2.02(a)
hereof.
Delay Delivery Mortgage Loans: The Mortgage Loans for which all or
a portion of a related Mortgage File is not delivered to the Trustee on the
Closing Date. The number of Delay Delivery Mortgage Loans shall not exceed 50%
of the aggregate number of Mortgage Loans in each Loan Group as of the Closing
Date. To the extent that Countrywide Home Loans Servicing LP shall be in
possession of any Mortgage Files with respect to any Delay Delivery Mortgage
Loan, until delivery of such
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Mortgage File to the Trustee as provided in Section 2.01, Countrywide Home
Loans Servicing LP shall hold such files as Master Servicer hereunder, as
agent and in trust for the Trustee.
Deleted Mortgage Loan: As defined in Section 2.03(c) hereof.
Denomination: With respect to each Certificate, the amount set
forth on the face thereof as the "Initial Certificate Balance of this
Certificate" or the "Initial Notional Amount of this Certificate" or, if
neither of the foregoing, the Percentage Interest appearing on the face
thereof.
Depositable Certificates: As specified in the Preliminary
Statement.
Depositor: CWALT, Inc., a Delaware corporation, or its successor
in interest.
Depository: The initial Depository shall be The Depository Trust
Company, the nominee of which is CEDE & Co., as the registered Holder of the
Book-Entry Certificates. The Depository shall at all times be a "clearing
corporation" as defined in Section 8-102(a)(5) of the Uniform Commercial Code
of the State of New York.
Depository Participant: A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
Determination Date: As to any Distribution Date, the 22nd day of
each month or if such 22nd day is not a Business Day the next preceding
Business Day; provided, however, that if such 22nd day or such Business Day,
whichever is applicable, is less than two Business Days prior to the related
Distribution Date, the Determination Date shall be the first Business Day
which is two Business Days preceding such Distribution Date.
Discount Mortgage Loan: Any Mortgage Loan in a Loan Group with an
Adjusted Net Mortgage Rate that is less than the Required Coupon for that Loan
Group.
Distribution Account: The separate Eligible Account created and
maintained by the Trustee pursuant to Section 3.05 in the name of the Trustee
for the benefit of the Certificateholders and designated "The Bank of New York
in trust for registered holders of Alternative Loan Trust 2007-5CB, Mortgage
Pass-Through Certificates, Series 2007-5CB." Funds in the Distribution Account
shall be held in trust for the Certificateholders for the uses and purposes
set forth in this Agreement.
Distribution Account Deposit Date: As to any Distribution Date,
12:30 p.m. Pacific time on the Business Day immediately preceding such
Distribution Date.
Distribution Date: The 25th day of each calendar month after the
initial issuance of the Certificates, or if such 25th day is not a Business
Day, the next succeeding Business Day, commencing in March 2007.
Due Date: With respect to any Distribution Date, the related Due
Date is the first day of the month in which that Distribution Date occurs.
XXXXX: The Commission's Electronic Data Gathering, Analysis and
Retrieval system.
Eligible Account: Any of (i) an account or accounts maintained
with a federal or state chartered depository institution or trust company the
short-term unsecured debt obligations of which (or,
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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 hereof.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA-Qualifying Underwriting: A best efforts or firm commitment
underwriting or private placement that meets the requirements of an
Underwriter's Exemption.
ERISA-Restricted Certificate: As specified in the Preliminary
Statement.
ES Trust: The separate trust created under this Agreement pursuant
to Section 5.07.
ES Trust Certificate: Any Class of Certificates issued by the ES
Trust and representing beneficial ownership of one or more uncertificated
Master REMIC Interests held by such ES Trust.
Escrow Account: The Eligible Account or Accounts established and
maintained pursuant to Section 3.06(a) hereof.
Event of Default: As defined in Section 7.01 hereof.
Excess Proceeds: With respect to any Liquidated Mortgage Loan, the
amount, if any, by which the sum of any Liquidation Proceeds received with
respect to such Mortgage Loan during the calendar month in which such Mortgage
Loan became a Liquidated Mortgage Loan plus any Subsequent Recoveries received
with respect to such Mortgage Loan, net of any amounts previously reimbursed
to the Master Servicer as Nonrecoverable Advance(s) with respect to such
Mortgage Loan pursuant to Section 3.08(a)(iii), exceeds (i) the unpaid
principal balance of such Liquidated Mortgage Loan as of the Due Date in the
month in which such Mortgage Loan became a Liquidated Mortgage Loan plus (ii)
accrued interest at the Mortgage Rate from the Due Date as to which interest
was last paid or advanced (and not reimbursed) to Certificateholders up to the
Due Date applicable to the Distribution Date immediately following the
calendar month during which such liquidation occurred.
Exchange Act: The Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder.
Exchange Act Reports: Any reports on Form 10-D, Form 8-K and Form
10-K required to be filed by the Depositor with respect to the Trust Fund
under the Exchange Act.
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Exchange Fee: As defined in Section 5.07(e).
Exchangeable Certificates: As specified in the Preliminary
Statement.
Exchangeable Certificates Distribution Account: The separate
Eligible Account created and maintained by the Trustee on behalf of the ES
Trust pursuant to Section 5.07(a) in the name of the Trustee for the benefit
of the Holders of the Exchangeable Certificates and designated "The Bank of
New York in trust for registered Holders of Alternative Loan Trust 2007-5CB,
Mortgage Pass-Through Certificates, Series 2007-5CB." Funds in the
Exchangeable Certificates Distribution Account shall be held in trust for the
Certificateholders for the uses and purposes set forth in this Agreement.
Expense Rate: As to each Mortgage Loan, the sum of the Master
Servicing Fee Rate and 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 thereto.
Final Certification: As defined in Section 2.02(a) hereof.
FIRREA: The Financial Institutions Reform, Recovery, and
Enforcement Act of 1989.
Fitch: Fitch, Inc., or any successor thereto. If Fitch is
designated as a Rating Agency in the Preliminary Statement, for purposes of
Section 10.05(b) the address for notices to Fitch shall be Fitch, Inc., 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 thereto.
Form 10-D Disclosure Item: With respect to any Person, any
material litigation or governmental proceedings pending (a) against such
Person, or (b) against any of the Trust Fund, the Depositor, the Trustee, the
co-trustee, the Master Servicer or any Subservicer if such Person has actual
knowledge thereof.
Form 10-K Disclosure Item: With respect to any Person, (a) any
Form 10-D Disclosure Item and (b) any affiliations or relationships between
such Person and any Item 1119 Party.
Grantor Trust: A trust described in Section 671 of the Code, the
items of income, deductions and credits of which must be included in computing
the taxable income and credits of the person treated as the owner of such
trust (either the grantor or other person designated under the Code).
Group 1 Mortgage Loans: The Mortgage Loans in Loan Group 1.
Group 1 Priority Amount : As to any Distribution Date, an amount
equal to the sum of (i) the product of (A) the Scheduled Principal
Distribution Amount for Loan Group 1, (B) the Shift Percentage, (C) the Group
1 Priority Percentage and (D) the Senior Percentage for Loan Group 1 and (ii)
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the product of (A) the Unscheduled Principal Distribution Amount for loan
group 1, (B) the Shift Percentage, (C) the Group 1 Priority Percentage and (D)
the Senior Prepayment Percentage for Loan Group 1.
Group 1 Priority Percentage: As to any Distribution Date, an
amount equal to the percentage equivalent of a fraction, the numerator of
which is the aggregate Class Certificate Balance of the Class 1-A-4, Class
1-A-9 and Class 1-A-13 Certificates immediately prior to such Distribution
Date, and the denominator of which is the aggregate Class Certificate Balance
of the Group 1 Senior Certificates (other than the related Class PO Component)
immediately prior to that Distribution Date.
Group 1 Senior Certificates: As specified in the Preliminary
Statement.
Group 2 Mortgage Loans: The Mortgage Loans in Loan Group 2.
Group 2 Priority Amount: As to any Distribution Date, an amount
equal to the sum of (i) the product of (A) the Scheduled Principal
Distribution Amount for Loan Group 2, (B) the Shift Percentage, (C) the Group
2 Priority Percentage and (D) the Senior Percentage for Loan Group 2 and (ii)
the product of (A) the Unscheduled Principal Distribution Amount for Loan
Group 2, (B) the Shift Percentage, (C) the Group 2 Priority Percentage and (D)
the Senior Prepayment Percentage for Loan Group 2.
Group 2 Priority Percentage: As to any Distribution Date will
equal the percentage equivalent of a fraction, the numerator of which is the
Class Certificate Balance of the Class 2-A-3 Certificates immediately prior to
such Distribution Date, and the denominator of which is the aggregate Class
Certificate Balance of the Group 2 Senior Certificates (other than the related
Class PO Component) immediately prior to that Distribution Date.
Group 2 Senior Certificates: As specified in the Preliminary
Statement.
Index: With respect to any Interest Accrual Period for the COFI
Certificates, if any, the then-applicable index used by the Trustee pursuant
to Section 4.07 to determine the applicable Pass-Through Rate for such
Interest Accrual Period for the COFI Certificates.
Indirect Participant: A broker, dealer, bank or other financial
institution or other Person that clears through or maintains a custodial
relationship with a Depository Participant.
Initial Certification: As defined in Section 2.02(a) hereof.
Initial Component Balance: As specified in the Preliminary
Statement.
Initial LIBOR Rate: 5.32% per annum.
Insurance Policy: With respect to any Mortgage Loan included in
the Trust Fund, any insurance policy, including all riders and endorsements
thereto in effect, including any replacement policy or policies for any
Insurance Policies.
Insurance Proceeds: Proceeds paid by an insurer pursuant to any
Insurance Policy, in each case other than any amount included in such
Insurance Proceeds in respect of Insured Expenses.
Insured Expenses: Expenses covered by an Insurance Policy or any
other insurance policy with respect to the Mortgage Loans.
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Interest Accrual Period: With respect to each Class of Delay
Certificates, its corresponding Lower Tier REMIC Regular Interest and any
Distribution Date, the calendar month prior to the month of such Distribution
Date. With respect to any Class of Non-Delay Certificates, its corresponding
Lower Tier REMIC Regular Interest and any Distribution Date, the one month
period commencing on the 25th day of the month preceding the month in which
such Distribution Date occurs and ending on the 24th day of the month in which
such Distribution Date occurs.
Interest Determination Date: With respect to (a) any Interest
Accrual Period for any LIBOR Certificates and (b) any Interest Accrual Period
for the COFI Certificates for which the applicable Index is LIBOR, the second
Business Day prior to the first day of such Interest Accrual Period.
Item 1119 Party: The Depositor, any Seller, the Master Servicer,
the Trustee, any Subservicer, any originator identified in the Prospectus
Supplement, the Corridor Contract Counterparty and any other material
transaction party, as identified in Exhibit X hereto, as updated pursuant to
Section 11.04.
Latest Possible Maturity Date: The Distribution Date following the
third anniversary of the scheduled maturity date of the Mortgage Loan having
the latest scheduled maturity date as of the Cut-off Date.
Lender PMI Mortgage Loan: Certain Mortgage Loans as to which the
lender (rather than the borrower) acquires the Primary Insurance Policy and
charges the related borrower an interest premium.
LIBOR: The London interbank offered rate for one-month United
States dollar deposits calculated in the manner described in Section 4.08.
LIBOR Certificates: As specified in the Preliminary Statement.
Limited Exchange Act Reporting Obligations: The obligations of the
Master Servicer under Section 3.16(b), Section 6.02 and Section 6.04 with
respect to notice and information to be provided to the Depositor and Article
XI (except Section 11.07(a)(1) and (2)).
Liquidated Mortgage Loan: With respect to any Distribution Date, a
defaulted Mortgage Loan (including any REO Property) which was liquidated in
the calendar month preceding the month of such Distribution Date and as to
which the Master Servicer has determined (in accordance with this Agreement)
that it has received all amounts it expects to receive in connection with the
liquidation of such Mortgage Loan, including the final disposition of an REO
Property.
Liquidation Proceeds: Amounts, including Insurance Proceeds,
received in connection with the partial or complete liquidation of defaulted
Mortgage Loans, whether through trustee's sale, foreclosure sale or otherwise
or amounts received in connection with any condemnation or partial release of
a Mortgaged Property and any other proceeds received in connection with an REO
Property, less the sum of related unreimbursed Master Servicing Fees,
Servicing Advances and Advances.
Loan Group: Any of Loan Group 1 or Loan Group 2, as applicable.
Loan Group 1: All Mortgage Loans identified as Group 1 Mortgage
Loans on the Mortgage Loan Schedule.
I-15
Loan Group 2: All Mortgage Loans identified as Group 2 Mortgage
Loans on the Mortgage Loan Schedule.
Loan Group Principal Balance: As to any Distribution Date and Loan
Group, the aggregate Stated Principal Balance of the Mortgage Loans in that
Loan Group as of the Due Date in the month preceding the month of the
Distribution Date (after giving effect to Principal Prepayments received in
the Prepayment Period related to such prior Due Date).
Loan-to-Value Ratio: With respect to any Mortgage Loan and as to
any date of determination, the fraction (expressed as a percentage) the
numerator of which is the principal balance of the related Mortgage Loan at
such date of determination and the denominator of which is the Appraised Value
of the related Mortgaged Property.
Lost Mortgage Note: Any Mortgage Note the original of which was
permanently lost or destroyed and has not been replaced.
Lower Tier REMIC: As specified in the Preliminary Statement.
Lower Tier REMIC Interest: As specified in the Preliminary
Statement.
Lower Tier REMIC Regular Interest: As specified in the Preliminary
Statement.
LTR-A-R Interest: As specified 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 Home Loans Servicing LP, a Texas
limited partnership, and its successors and assigns, in its capacity as master
servicer hereunder.
Master Servicer Advance Date: As to any Distribution Date, 12:30
p.m. Pacific time on the Business Day immediately preceding such Distribution
Date.
Master Servicing Fee: As to each Mortgage Loan and any
Distribution Date, an amount payable out of each full payment of interest
received on such Mortgage Loan and equal to one-twelfth of the Master
Servicing Fee Rate multiplied by the Stated Principal Balance of such Mortgage
Loan as of the Due Date in the month preceding the month of such Distribution
Date, subject to reduction as provided in Section 3.14.
Master Servicing Fee Rate: With respect to each Mortgage Loan,
0.250% per annum.
MERS: Mortgage Electronic Registration Systems, Inc., a
corporation organized and existing under the laws of the State of Delaware,
or any successor thereto.
MERS Mortgage Loan: Any Mortgage Loan registered with MERS on
the MERS System.
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MERS (R) System: The system of recording transfers of mortgages
electronically maintained by MERS.
MIN: The Mortgage Identification Number for any MERS Mortgage
Loan.
MOM Loan: Any Mortgage Loan as to which MERS is acting as
mortgagee, solely as nominee for the originator of such Mortgage Loan and its
successors and assigns.
Monthly Statement: The statement delivered to the
Certificateholders pursuant to Section 4.06.
Moody's: Xxxxx'x Investors Service, Inc., or any successor
thereto. If Xxxxx'x is designated as a Rating Agency in the Preliminary
Statement, for purposes of Section 10.05(b) the address for notices to
Moody's shall be Xxxxx'x Investors Service, Inc., 00 Xxxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attention: Residential Pass-Through Monitoring, or such other
address as Moody's may hereafter furnish to the Depositor or the Master
Servicer.
Mortgage: The mortgage, deed of trust or other instrument creating
a first lien on an estate in fee simple or leasehold interest in real property
securing a Mortgage Note.
Mortgage File: The mortgage documents listed in Section 2.01
hereof pertaining to a particular Mortgage Loan and any additional documents
delivered to the Trustee to be added to the Mortgage File pursuant to this
Agreement.
Mortgage Loans: Such of the mortgage loans as from time to time
are transferred and assigned to the Trustee pursuant to the provisions hereof
and that are held as a part of the Trust Fund (including any REO Property),
the mortgage loans so held being identified in the Mortgage Loan Schedule,
notwithstanding foreclosure or other acquisition of title of the related
Mortgaged Property.
Mortgage Loan Schedule: The list of Mortgage Loans (as from time
to time amended by the Master Servicer to reflect the addition of Substitute
Mortgage Loans and the deletion of Deleted Mortgage Loans pursuant to the
provisions of this Agreement) transferred to the Trustee as part of the Trust
Fund and from time to time subject to this Agreement, attached hereto as
Schedule I, setting forth the following information with respect to each
Mortgage Loan 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;
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(ix) a code indicating whether the residential dwelling at the time of
origination was represented to be owner-occupied;
(x) a code indicating whether the residential dwelling is either (a) a
detached single family dwelling (b) a dwelling in a de minimis
PUD, (c) a condominium unit or PUD (other than a de minimis PUD),
(d) a two- to four-unit residential property or (e) a Cooperative
Unit;
(xi) the Mortgage Rate;
(xii) a code indicating whether the Mortgage Loan is a Countrywide
Mortgage Loan, a Park Granada Mortgage Loan, a Park Monaco
Mortgage Loan or a Park Sienna Mortgage Loan;
(xiii) a code indicating whether the Mortgage Loan is a Lender PMI
Mortgage Loan and, in the case of any Lender PMI Mortgage Loan, a
percentage representing the amount of the related interest premium
charged to the borrower;
(xiv) the purpose for the Mortgage Loan;
(xv) the type of documentation program pursuant to which the Mortgage
Loan was originated;
(xvi) [Reserved]; and
(xvii) a code indicating whether the Mortgage Loan is a MERS Mortgage
Loan.
Such schedule shall also set forth the total of the amounts
described under (iv) and (v) above for all of the Mortgage Loans and for each
Loan Group.
Mortgage 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.
MTR-A-R Interest: As specified in the Preliminary Statement.
National Cost of Funds Index: The National Monthly Median Cost
of Funds Ratio to SAIF-Insured Institutions published by the Office of Thrift
Supervision.
Net Prepayment Interest Shortfalls: As to any Distribution Date
and Loan Group, the amount by which the aggregate of the Prepayment Interest
Shortfalls for such Loan Group and Distribution Date exceeds an amount equal
to the sum of (a) the Compensating Interest for such Loan Group and
Distribution Date and (b) the excess, if any, of the Compensating Interest for
the other Loan Group for such Distribution Date over the Prepayment Interest
Shortfalls for such other Loan Group and Distribution Date.
Non-Delay Certificates: As specified in the Preliminary
Statement.
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Non-Discount Mortgage Loan: Any Mortgage Loan in a Loan Group with
an Adjusted Net Mortgage Rate that is greater than or equal to the Required
Coupon for such Loan Group.
Non-PO Formula Principal Amount: As to any Distribution Date and
Loan Group, the sum of (i) the sum of the applicable Non-PO Percentage of (a)
the principal portion of each Scheduled Payment (without giving effect to any
reductions thereof caused by any Debt Service Reductions or Deficient
Valuations) due on each Mortgage Loan in the related Loan Group on the related
Due Date, (b) the Stated Principal Balance 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 Liquidation
Proceeds allocable to principal received during the calendar month preceding
the month of such Distribution Date with respect to such Mortgage Loan and (f)
all Principal Prepayments for such Loan Group received during the related
Prepayment Period and (ii) (A) any Subsequent Recoveries received on the
Mortgage Loans in that Loan Group during the calendar month preceding the
month of such Distribution Date, or (B) with respect to Subsequent Recoveries
attributable to a Discount Mortgage Loan in such Loan Group which incurred a
Realized Loss after the Senior Credit Support Depletion Date, the Non-PO
Percentage of any such Subsequent Recoveries received during the calendar
month preceding the month of such Distribution Date.
Non-PO Percentage: As to any Discount Mortgage Loan in a Loan
Group, a fraction (expressed as a percentage) the numerator of which is the
Adjusted Net Mortgage Rate of such Discount Mortgage Loan and the denominator
of which is the Required Coupon for such Loan Group. As to any Non-Discount
Mortgage Loan, 100%.
Non-PO Pool Balance: As to any Loan Group and any Due Date, the
amount equal to the excess, if any, of (i) the aggregate Stated Principal
Balance of all Mortgage Loans in that Loan Group over (ii) the sum of the PO
Percentage of the Stated Principal Balance of each Discount Mortgage Loan in
that Loan Group.
Nonrecoverable Advance: Any portion of an Advance previously made
or proposed to be made by the Master Servicer that, in the good faith judgment
of the Master Servicer, will not be ultimately recoverable by the Master
Servicer from the related Mortgagor, related Liquidation Proceeds, Subsequent
Recoveries or otherwise.
Notice of Final Distribution: The notice to be provided pursuant
to Section 9.02 to the effect that final distribution on any of the
Certificates shall be made only upon presentation and surrender thereof.
Notional Amount: With respect to any Distribution Date and:
(i) the Class 1-A-5 Certificates, an amount equal to the Class
Certificate Balance of the Class 1-A-6 Certificates immediately prior to such
Distribution Date;
(ii) the Class 1-A-14 Certificates, an amount equal to the Class
Certificate Balance of the Class 1-A-15 Certificates immediately prior to such
Distribution Date;
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(iii) the Class 1-A-18 Certificates, an amount equal to the Class
Certificate Balance of the Class 1-A-19 Certificates immediately prior to such
Distribution Date;
(iv) the Class 1-A-20 Certificates, an amount equal to the Class
Certificate Balance of the Class 1-A-21 Certificates immediately prior to such
Distribution Date;
(v) the Class 1-A-22 Certificates, an amount equal to the Class
Certificate Balance of the Class 1-A-23 Certificates immediately prior to such
Distribution Date;
(vi) the Class 1-A-26 Certificates, an amount equal to the Class
Certificate Balance of the Class 1-A-27 Certificates immediately prior to such
Distribution Date;
(vii) the Class 1-A-29 Certificates, an amount equal to the Class
Certificate Balance of the Class 1-A-30 Certificates immediately prior to such
Distribution Date;
(viii) the Class 1-A-32 Certificates, an amount equal to the Class
Certificate Balance of the Class 1-A-33 Certificates immediately prior to such
Distribution Date;
(ix) the Class 1-A-35 Certificates, an amount equal to the Class
Certificate Balance of the Class 1-A-36 Certificates immediately prior to such
Distribution Date;
(x) the Class 2-A-4 Certificates, an amount equal to the Class
Certificate Balance of the Class 2-A-5 Certificates immediately prior to such
Distribution Date;
(xi) the Class 1-X Certificates, an amount equal to the aggregate Stated
Principal Balance of the Non-Discount Mortgage Loans in Loan Group 1 as of the
Due Date in the preceding calendar month (after giving effect to Principal
Prepayments received in the Prepayment Period related to such prior Due Date);
and
(xii) the Class 2-X Certificates, an amount equal to the aggregate
Stated Principal Balance of the Non-Discount Mortgage Loans in Loan Group 2 as
of the Due Date in the preceding calendar month (after giving effect to
Principal Prepayments received in the Prepayment Period related to such prior
Due Date).
Notional Amount Certificates: As specified in the Preliminary
Statement.
Offered Certificates: As specified in the Preliminary Statement.
Officer's Certificate: A certificate (i) in the case of the
Depositor, signed by the Chairman of the Board, the Vice Chairman of the
Board, the President, a Managing Director, a Vice President (however
denominated), an Assistant Vice President, the Treasurer, the Secretary, or
one of the Assistant Treasurers or Assistant Secretaries of the Depositor,
(ii) in the case of the Master Servicer, signed by the President, an Executive
Vice President, a Vice President, an Assistant Vice President, the Treasurer,
or one of the Assistant Treasurers or Assistant Secretaries of Countrywide GP,
Inc., its general partner, (iii) if provided for in this Agreement, signed by
a Servicing Officer, as the case may be, and delivered to the Depositor and
the Trustee, as the case may be, as required by this Agreement or (iv) in the
case of any other Person, signed by an authorized officer of such Person.
Opinion of Counsel: A written opinion of counsel, who may be
counsel for a Seller, the Depositor or the Master Servicer, including,
in-house counsel, reasonably acceptable to the Trustee; provided, however,
that with respect to the interpretation or application of the REMIC
Provisions, such
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counsel must (i) in fact be independent of a Seller, the Depositor and the
Master Servicer, (ii) not have any direct financial interest in a Seller, the
Depositor or the Master Servicer or in any affiliate thereof, and (iii) not be
connected with a Seller, the Depositor or the Master Servicer as an officer,
employee, promoter, underwriter, trustee, partner, director or person
performing similar functions.
Optional Termination: The termination of the trust created
hereunder in connection with the purchase of the Mortgage Loans pursuant to
Section 9.01(a) hereof.
Original Applicable Credit Support Percentage: With respect to
each of the following Classes of Certificates, the corresponding percentage
described below, as of the Closing Date:
Class M...........4.85%
Class B-1.........2.70%
Class B-2.........1.80%
Class B-3.........1.15%
Class B-4.........0.70%
Class B-5.........0.30%
Original Mortgage Loan: The mortgage loan refinanced in
connection with the origination of a Refinancing Mortgage Loan.
Original Subordinate Principal Balance: For any Distribution Date
(a) on or prior to a Senior Termination Date, the Subordinated Percentage for
a Loan Group of the aggregate of the applicable Non-PO Percentage of the
Stated Principal Balances of the Mortgage Loans in such Loan Group, in each
case as of the Cut-off Date; or (b) is after a Senior Termination Date, the
aggregate of the Class Certificate Balances of the Subordinated Certificates
as of the Closing Date.
OTS: The Office of Thrift Supervision.
Outside Reference Date: As to any Interest Accrual Period for
the COFI Certificates, the close of business on the tenth day thereof.
Outstanding: With respect to the Certificates as of any date of
determination, all Certificates theretofore executed and authenticated under
this Agreement except:
(i) Certificates theretofore canceled by the Trustee or delivered to
the Trustee for cancellation; and
(ii) Certificates in exchange for which or in lieu of which other
Certificates have been executed and delivered by the Trustee
pursuant to this Agreement.
Outstanding Mortgage Loan: As of any Due Date, a Mortgage Loan
with a Stated Principal Balance greater than zero, which was not the subject
of a Principal Prepayment in Full prior to such Due Date or during the
Prepayment Period related 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.
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Xxxx Xxxxxxx: Xxxx Xxxxxxx LLC, a Delaware limited liability
company, and its successors and assigns, in its capacity as the seller of the
Park Granada Mortgage Loans to the Depositor.
Park Granada Mortgage Loans: The Mortgage Loans identified as
such on the Mortgage Loan Schedule for which Park Granada is the applicable
Seller.
Park Monaco: Park Monaco Inc., a Delaware corporation, and its
successors and assigns, in its capacity as the seller of the Park Monaco
Mortgage Loans to the Depositor.
Park Monaco Mortgage Loans: The Mortgage Loans identified as
such on the Mortgage Loan Schedule for which Park Monaco is the applicable
Seller.
Park Sienna: Park Sienna LLC, a Delaware limited liability
company, and its successors and assigns, in its capacity as the seller of the
Park Sienna Mortgage Loans to the Depositor.
Park Sienna Mortgage Loans: The Mortgage Loans identified as
such on the Mortgage Loan Schedule for which Park Sienna is the applicable
Seller.
Pass-Through Rate: For any interest bearing Class of Certificates
or Component, the per annum rate set forth or calculated in the manner
described in the Preliminary Statement.
Percentage Interest: As to any Certificate, the percentage
interest evidenced thereby in distributions required to be made on the related
Class, such percentage interest being set forth on 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.
Performance Certification: As defined in Section 11.05.
Permitted Investments: At any time, any one or more of the
following obligations and securities:
(i) obligations of the United States or any agency thereof,
provided such obligations are backed by the full faith and
credit of the United States;
(ii) general obligations of or obligations guaranteed by any
state of the United States or the District of Columbia
receiving the highest long-term debt rating of each Rating
Agency, or such lower rating as will not result in the
downgrading or withdrawal of the ratings then assigned to
the Certificates by each Rating Agency;
(iii) commercial or finance company paper which is then receiving
the highest commercial or finance company paper rating of
each Rating Agency, or such lower rating as will not result
in the downgrading or withdrawal of the ratings then
assigned to the Certificates by each Rating Agency;
(iv) certificates of deposit, demand or time deposits, or
bankers' acceptances issued by any depository institution or
trust company incorporated under the laws of the United
States or of any state thereof and subject to supervision
and examination by federal and/or state banking authorities,
provided that the commercial paper and/or long term
unsecured debt obligations of such depository institution or
trust company (or in the case of the principal depository
institution in a holding
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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 Xxxxx'x) 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;
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)(l) of the
Code) with respect to any Residual Certificate, (iv) rural electric and
telephone cooperatives described in section 1381(a)(2)(C) of the Code, (v) an
"electing large partnership" as defined in Section 775 of the Code, (vi) a
Person that is not a citizen or resident of the United States, a corporation,
partnership, or other entity created or organized in or under the laws of the
United States, any State thereof or the District of Columbia, or an estate or
trust whose income from sources without the United States is includible in
gross income for United States federal income tax purposes regardless of its
connection with the conduct of a trade or business within the United States or
a trust if a court within the United States is able to exercise primary
supervision over the administration of the trust and one or more United States
persons have the authority to control all substantial decisions of the trust
unless such Person has furnished the transferor and the Trustee with a duly
completed Internal Revenue Service Form W-8ECI or any applicable successor
form, and (vii) any other Person so designated by the Depositor based upon an
Opinion of Counsel that the Transfer of an Ownership Interest in a Residual
Certificate to such Person may cause any REMIC hereunder to fail to qualify as
a REMIC at any time that the Certificates are outstanding. The terms "United
States," "State" and "International Organization" shall have the meanings set
forth in section 7701 of the Code or successor provisions. A corporation will
not be treated as an instrumentality of the United States or of any State or
political subdivision thereof for these purposes if all of its activities are
subject to tax and, with the exception of the Federal Home Loan Mortgage
Corporation, a majority of its board of directors is not selected by such
government unit.
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Person: Any individual, corporation, partnership, association,
joint venture, 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.
Plan: An "employee benefit plan" as defined in section 3(3) of
ERISA that is subject to Title I of ERISA, a "plan" as defined in section 4975
of the Code that is subject to section 4975 of the Code, or any Person
investing on behalf of or with plan assets (as defined in 29 CFR ss.2510.3-101
or otherwise under ERISA) of such an employee benefit plan or plan.
Planned Balance: With respect to any group of Planned Principal
Classes or Components in the aggregate and any Distribution Date appearing in
Schedule V hereto, the Aggregate Planned Balance for such group and
Distribution Date. With respect to any other Planned Principal Class or
Component and any Distribution Date appearing in Schedule V hereto, the
applicable amount appearing opposite such Distribution Date for such Class or
Component.
Planned Principal Classes: As specified in the Preliminary
Statement.
PO Formula Principal Amount: As to any Distribution Date and Class
PO Component, the sum of (i) the sum of the applicable PO Percentage of (a)
the principal portion of each Scheduled Payment (without giving effect to any
reductions thereof caused by any Debt Service Reductions or Deficient
Valuations) due on each Mortgage Loan in the related Loan Group on the related
Due Date, (b) the Stated Principal Balance 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
the related 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 the
related Loan Group that became a Liquidated Mortgage Loan during the calendar
month preceding the month of such Distribution Date, the amount of Liquidation
Proceeds allocable to principal received with respect to such Mortgage Loan
during the calendar month preceding the month of such Distribution Date with
respect to such Mortgage Loan, and (f) all Principal Prepayments with respect
to the Mortgage Loans in the related Loan Group received during the related
Prepayment Period and (ii) with respect to Subsequent Recoveries attributable
to a Discount Mortgage Loan in the related Loan Group which incurred a
Realized Loss after the Senior Credit Support Depletion Date, the PO
Percentage of any such Subsequent Recoveries on the Mortgage Loans in such
Loan Group received during the calendar month preceding the month of such
Distribution Date.
PO Percentage: As to any Discount Mortgage Loan in a Loan Group, a
fraction (expressed as a percentage) the numerator of which is the excess of
the Required Coupon for such Loan Group over the Adjusted Net Mortgage Rate of
such Discount Mortgage Loan and the denominator of which is such Required
Coupon. As to any Non-Discount Mortgage Loan, 0%.
Pool Stated Principal Balance: As of any date of determination,
the aggregate of the Stated Principal Balances of the Outstanding Mortgage
Loans.
Prepayment Charge: With respect to any Mortgage Loan, the charges
or premiums, if any, due in connection with a full or partial Principal
Prepayment of such Mortgage Loan within the related Prepayment Charge Period
in accordance with the terms thereof.
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Prepayment Charge Amount: Not applicable.
Prepayment Charge Period: With respect to any Mortgage Loan, the
period of time during which a Prepayment Charge may be imposed.
Prepayment Interest Excess: As to any Principal Prepayment
received by the Master Servicer from the first day through the fifteenth day
of any calendar month (other than the calendar month in which the Cut-off Date
occurs), all amounts paid by the related Mortgagor in respect of interest on
such Principal Prepayment. All Prepayment Interest Excess shall be paid to the
Master Servicer as additional master servicing compensation.
Prepayment Interest Shortfall: As to any Distribution Date,
Mortgage Loan and Principal Prepayment received on or after the sixteenth day
of the month preceding the month of such Distribution Date (or, in the case of
the first Distribution Date, on or after February 1, 2007) and on or before
the last day of the month preceding the month of such Distribution Date, the
amount, if any, by which one month's interest at the related Mortgage Rate,
net of the Master Servicing Fee Rate, on such Principal Prepayment exceeds the
amount of interest paid in connection with such Principal Prepayment.
Prepayment Period: As to any Distribution Date and the related Due
Date, the period from the 16th day of the calendar month immediately preceding
the month of such Distribution Date (or, in the case of the first Distribution
Date, from February 1, 2007) through the 15th day of the calendar month of
such Distribution Date.
Prepayment Shift Percentage: Not applicable.
Primary Insurance Policy: Each policy of primary mortgage
guaranty insurance or any replacement policy therefor with respect to any
Mortgage Loan.
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 Only Certificates: As specified in the Preliminary
Statement.
Principal Prepayment: Any payment of principal by a Mortgagor on a
Mortgage Loan that is received in advance of its scheduled Due Date and is not
accompanied by an amount representing scheduled interest due on any date or
dates in any month or months subsequent to the month of prepayment. Partial
Principal Prepayments shall be applied by the Master Servicer in accordance
with the terms of the related Mortgage Note.
Principal Prepayment in Full: Any Principal Prepayment made by a
Mortgagor of the entire principal balance of a Mortgage Loan.
Principal Relocation Payment: A payment from any Loan Group to an
Lower Tier REMIC Regular Interest other than a Regular Interest corresponding
to that Loan Group as provided in the Preliminary Statement. Principal
Relocation Payments from a Loan Group shall be made of the amounts in respect
of principal from the Mortgage Loans of the Loan Group and shall include a
proportionate allocation of the Realized Losses from the Mortgage Loans of the
Loan Group.
Private Certificate: As specified in the Preliminary Statement.
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Pro Rata Share: As to any Distribution Date, the Subordinated
Principal Distribution Amount and any Class of Subordinated Certificates, the
portion of the Subordinated Principal Distribution Amount allocable to such
Class, equal to the product of the Subordinated Principal Distribution Amount
on such Distribution Date and a fraction, the numerator of which is the
related Class Certificate Balance thereof and the denominator of which is the
aggregate of the Class Certificate Balances of the Subordinated Certificates.
Proprietary Lease: With respect to any Cooperative Unit, a lease
or occupancy agreement between a Cooperative Corporation and a holder of
related Coop Shares.
Prospectus: The Prospectus dated November 14, 2006 generally
relating to mortgage pass-through certificates to be sold by the Depositor.
Prospectus Supplement: The Prospectus Supplement, dated February
26, 2007, relating to the Offered Certificates.
PUD: Planned Unit Development.
Purchase Price: With respect to any Mortgage Loan required to be
purchased by a Seller pursuant to Section 2.02 or 2.03 hereof or purchased at
the option of the Master Servicer pursuant to Section 3.11, an amount equal to
the sum of (i) 100% of the unpaid principal balance of the Mortgage Loan on
the date of such purchase, (ii) accrued interest thereon at the applicable
Mortgage Rate (or at the applicable Adjusted Mortgage Rate if (x) the
purchaser is the Master Servicer or (y) if the purchaser is Countrywide and
Countrywide is an affiliate of the Master Servicer) from the date through
which interest was last paid by the Mortgagor to the Due Date in the month in
which the Purchase Price is to be distributed to Certificateholders and (iii)
costs and damages incurred by the Trust Fund in connection with a repurchase
pursuant to Section 2.03 hereof that arises out of a violation of any
predatory or abusive lending law with respect to the related Mortgage Loan.
Qualified 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, identified as a rating agency
under the Underwriter's Exemption, as is designated by the Depositor, notice
of which designation shall be given to the Trustee. References herein to a
given rating category of a Rating Agency shall mean such rating category
without giving effect to any modifiers.
Realized Loss: With respect to each Liquidated Mortgage Loan, an
amount (not less than zero or more than the Stated Principal Balance of the
Mortgage Loan) as of the date of such liquidation, equal to (i) the Stated
Principal Balance of the Liquidated Mortgage Loan as of the date of such
liquidation, plus (ii) interest at the Adjusted Net Mortgage Rate from the Due
Date as to which interest was last paid or advanced (and not reimbursed) to
Certificateholders up to the Due Date in the month in which Liquidation
Proceeds are required to be distributed on the Stated Principal Balance of
such
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Liquidated Mortgage Loan from time to time, minus (iii) the Liquidation
Proceeds, if any, received during the month in which such liquidation
occurred, to the extent applied as recoveries of interest at the Adjusted Net
Mortgage Rate and to principal of the Liquidated Mortgage Loan. With respect
to each Mortgage Loan which has become the subject of a Deficient Valuation,
if the principal amount due under the related Mortgage Note has been reduced,
the difference between the principal balance of the Mortgage Loan outstanding
immediately prior to such Deficient Valuation and the principal balance of the
Mortgage Loan as reduced by the Deficient Valuation.
To the extent the Master Servicer receives Subsequent Recoveries
with respect to any Liquidated Mortgage Loan, the amount of the Realized Loss
with respect to that Mortgage Loan will be reduced by such Subsequent
Recoveries.
Recognition Agreement: With respect to any Cooperative Loan, an
agreement between the Cooperative Corporation and the originator of such
Mortgage Loan which establishes the rights of such originator in the
Cooperative Property.
Recombination Group: The Class or Classes of Depositable
Certificates and the related Class or Classes of Exchangeable Certificates
included within any particular "Recombination" specified in Schedule VII.
Record Date: As to any Distribution Date, the close of business on
the last Business Day of the month preceding the month of such Distribution
Date.
Reference Bank: As defined in Section 4.08(b).
Refinancing Mortgage Loan: Any Mortgage Loan originated in
connection with the refinancing of an existing mortgage loan.
Regular Certificates: As specified in the Preliminary Statement.
Regulation AB: Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. ss.ss.229.1100-229.1123, as such may be amended from
time to time, and subject to such clarification and interpretation as have
been provided by the Commission in the adopting release (Asset-Backed
Securities, Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531
(Jan. 7, 2005)) or by the staff of the Commission, or as may be provided by
the Commission or its staff from time to time.
Relief Act: The Servicemembers Civil Relief Act.
Relief Act Reductions: With respect to any Distribution Date and
any Mortgage Loan as to which there has been a reduction in the amount of
interest collectible thereon for the most recently ended calendar month as a
result of the application of the Relief Act or any similar state laws, the
amount, if any, by which (i) interest collectible on such Mortgage Loan for
the most recently ended calendar month is less than (ii) interest accrued
thereon for such month pursuant to the Mortgage Note.
REMIC: A "real estate mortgage investment conduit" within the
meaning of section 860D of the Code.
REMIC Change of Law: Any proposed, temporary or final regulation,
revenue ruling, revenue procedure or other official announcement or
interpretation relating to REMICs and the REMIC Provisions issued after the
Closing Date.
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REMIC Provisions: Provisions of the federal income tax law
relating to real estate mortgage investment conduits, which appear at sections
860A through 860G of Subchapter M of Chapter 1 of the Code, and related
provisions, and regulations promulgated thereunder, as the foregoing may be in
effect from time to time as well as provisions of applicable state laws.
REO Property: A Mortgaged Property acquired by the Trust Fund
through foreclosure or deed-in-lieu of foreclosure in connection with a
defaulted Mortgage Loan.
Reportable Event: Any event required to be reported on Form 8-K,
and in any event, the following:
(a) entry into a definitive agreement related to the Trust Fund,
the Certificates or the Mortgage Loans, or an amendment to a Transaction
Document, even if the Depositor is not a party to such agreement (e.g., a
servicing agreement with a servicer contemplated by Item 1108(a)(3) of
Regulation AB);
(b) termination of a Transaction Document (other than by
expiration of the agreement on its stated termination date or as a result of
all parties completing their obligations under such agreement), even if the
Depositor is not a party to such agreement (e.g., a servicing agreement with a
servicer contemplated by Item 1108(a)(3) of Regulation AB);
(c) with respect to the Master Servicer only, if the Master
Servicer becomes aware of any bankruptcy or receivership with respect to
Countrywide, the Depositor, the Master Servicer, any Subservicer, the Trustee,
any enhancement or support provider contemplated by Items 1114(b) or 1115 of
Regulation AB, or any other material party contemplated by Item 1101(d)(1) of
Regulation AB;
(d) with respect to the Trustee, the Master Servicer and the
Depositor only, the occurrence of an early amortization, performance trigger
or other event, including an Event of Default under this Agreement;
(e) the resignation, removal, replacement, substitution of the
Master Servicer, any Subservicer or the Trustee;
(f) with respect to the Master Servicer only, if the Master
Servicer becomes aware that (i) any material enhancement or support specified
in Item 1114(a)(1) through (3) of Regulation AB or Item 1115 of Regulation AB
that was previously applicable regarding one or more Classes of the
Certificates has terminated other than by expiration of the contract on its
stated termination date or as a result of all parties completing their
obligations under such agreement; (ii) any material enhancement specified in
Item 1114(a)(1) through (3) of Regulation AB or Item 1115 of Regulation AB has
been added with respect to one or more Classes of the Certificates; or (iii)
any existing material enhancement or support specified in Item 1114(a)(1)
through (3) of Regulation AB or Item 1115 of Regulation AB with respect to one
or more Classes of the Certificates has been materially amended or modified;
and
(g) with respect to the Trustee, the Master Servicer and the
Depositor only, a required distribution to Holders of the Certificates is not
made as of the required Distribution Date under this Agreement.
Reporting Subcontractor: With respect to the Master Servicer or
the Trustee, any Subcontractor determined by such Person pursuant to Section
11.08(b) to be "participating in the servicing function" within the meaning of
Item 1122 of Regulation AB. References to a Reporting
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Subcontractor shall refer only to the Subcontractor of such Person and shall
not refer to Subcontractors generally.
Request for Release: The Request for Release submitted by the
Master Servicer to the Trustee, substantially in the form of Exhibits M and N,
as appropriate.
Required Coupon: With respect to the Mortgage Loans in both Loan
Group 1 and Loan Group 2, 6.00% per annum.
Required Insurance Policy: With respect to any Mortgage Loan, any
insurance policy that is required to be maintained from time to time under
this Agreement.
Residual Certificates: As specified in the Preliminary Statement.
Responsible Officer: When used with respect to the Trustee, any
Vice President, any Assistant Vice President, the Secretary, any Assistant
Secretary, any Trust Officer or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also to whom, with respect to a particular matter, such matter is
referred because of such officer's knowledge of and familiarity with the
particular subject.
Restricted Classes: As defined in Section 4.02(e).
Xxxxxxxx-Xxxxx Certification: As defined in Section 11.05.
S&P: Standard & Poor's, a division of The XxXxxx-Xxxx Companies,
Inc. If S&P is designated as a Rating Agency in the Preliminary Statement, for
purposes of Section 10.05(b) the address for notices to S&P shall be Standard
& Poor's, 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Mortgage
Surveillance Monitoring, or such other address as S&P may hereafter furnish to
the Depositor and the Master Servicer.
Schedule: The Schedule set forth in Schedule V hereto.
Scheduled Balances: With respect to any group of Scheduled
Principal Classes or Components in the aggregate and any Distribution Date
appearing in Schedule V hereto, the Aggregate Scheduled Balance for such group
and Distribution Date. With respect to any other Scheduled Principal Class or
Component and any Distribution Date appearing in Schedule V hereto, the
applicable amount appearing opposite such Distribution Date for such Class or
Component.
Scheduled Payment: The scheduled monthly payment on a Mortgage
Loan due on any Due Date allocable to principal and/or interest on such
Mortgage Loan which, unless otherwise specified herein, shall give effect to
any related Debt Service Reduction and any Deficient Valuation that affects
the amount of the monthly payment due on such Mortgage Loan.
Scheduled Principal Classes: As specified in the Preliminary
Statement.
Scheduled Principal Distribution Amount: As to any Distribution
Date and Loan Group, an amount equal to the Non-PO Percentage of all amounts
described in subclauses (a) through (d) of clause (i) of the definition of
Non-PO Formula Principal Amount for such Loan Group and Distribution Date.
Securities Act: The Securities Act of 1933, as amended.
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Seller: Countrywide, Park Granada, Park Monaco or Park Sienna,
as applicable.
Senior Certificate Group: As specified in the Preliminary
Statement.
Senior Certificates: As specified in the Preliminary Statement.
Senior Credit Support Depletion Date: The date on which the
Class Certificate Balance of each Class of Subordinated Certificates has been
reduced to zero.
Senior Percentage: 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 the Senior Certificates of
such Senior Certificate Group (other than the related Class PO Component and
Notional Amount Certificates) immediately prior to such Distribution Date and
the denominator of which is the aggregate of the applicable Non-PO Percentage
of the Stated Principal Balance of each Mortgage Loan in the related Loan
Group as of the Due Date occurring in the month prior to the month of such
Distribution Date (after giving effect to Principal Prepayments received in
the Prepayment Period related to such prior Due Date); provided, however, that
on any Distribution Date after a Senior Termination Date, the Senior
Percentage for the Senior Certificates of the remaining Senior Certificate
Group is the percentage equivalent of a fraction, the numerator of which is
the aggregate Class Certificate Balance of the Senior Certificates of such
remaining Senior Certificate Group (other than the related Class PO Component
and Notional Amount Certificates) immediately prior to such Distribution Date
and the denominator is the aggregate Class Certificate Balance of all Classes
of Certificates (other than the Class PO Certificates and the Notional Amount
Certificates), immediately prior to such Distribution Date.
Senior Prepayment Percentage: As to a Senior Certificate Group and
any Distribution Date during the five years beginning on the first
Distribution Date, 100%. The Senior Prepayment Percentage for any Distribution
Date occurring on or after the fifth anniversary of the first Distribution
Date will, except as provided herein, be as follows: for any Distribution Date
in the first year thereafter, the 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 Senior Percentage exceeds the initial Senior Percentage
of such Senior Certificate Group, in which case the Senior Prepayment
Percentage for each Senior Certificate Group for such Distribution Date will
once again equal 100%). Notwithstanding the foregoing, no decrease in any
Senior Prepayment Percentage will occur unless both of the Senior Step Down
Conditions are satisfied with respect to all of the Loan Groups.
Senior Principal Distribution Amount: As to any Distribution Date
and Senior Certificate Group, the sum of (i) the related Senior Percentage of
the applicable Non-PO Percentage of all amounts described in subclauses (a)
through (d) of clause (i) of the definition of "Non-PO Formula 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 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
applicable Non-PO Percentage of the Stated Principal Balance of such Mortgage
Loan and (y) the related Senior Prepayment Percentage of the applicable Non-PO
Percentage of the amount of the Liquidation Proceeds allocable to principal
received with respect to the Mortgage Loan and (iii) the sum of (x) the
related Senior Prepayment Percentage of the applicable Non-PO Percentage of
the amounts
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described in subclause (f) of clause (i) of the definition of "Non-PO Formula
Principal Amount" with respect to the related Loan Group for such Distribution
Date plus (y) the related Senior Prepayment Percentage of any Subsequent
Recoveries described in clause (ii) of the definition of "Non-PO Formula
Principal Amount" for such Distribution Date ; provided, however, on any
Distribution Date after a Senior Termination Date, the Senior Principal
Distribution Amount for the remaining Senior Certificate Group will be
calculated pursuant to the above formula based on all the Mortgage Loans in
the Mortgage Pool, as opposed to the Mortgage Loans in the related Loan Group
and, if such Distribution Date is a Senior Termination Date, shall be reduced
by the amount of the principal distribution made pursuant to (a) if the Group
1 Senior Certificates are reduced to zero on such date, Section
4.02(a)(1)(iv)(y) and (b) if the Group 2 Senior Certificates are reduced to
zero on such date, Section 4.02(a)(2)(iv)(y).
Senior Step Down Conditions: With respect to the Mortgage Loans in
a Loan Group: (i) the outstanding principal balance of all Mortgage Loans
delinquent 60 days or more (including Mortgage Loans in foreclosure, REO
Property and Mortgage Loans the mortgagors of which are in bankruptcy)
(averaged over the preceding six month period), as a percentage of (a) if such
date is on or prior to a Senior Termination Date, the Subordinated Percentage
for such Loan Group of the aggregate of the applicable Non-PO Percentage of
the Stated Principal Balance of each Mortgage Loan in that Loan Group, or (b)
if such date is after a Senior Termination Date, the aggregate Class
Certificate Balance of the Subordinated Certificates, does not equal or exceed
50%, and (ii) cumulative Realized Losses on the Mortgage Loans in such Loan
Group do not exceed: (a) commencing with the Distribution Date on the fifth
anniversary of the first Distribution Date, 30% of the Original Subordinate
Principal Balance, (b) commencing with the Distribution Date on the sixth
anniversary of the first Distribution Date, 35% of the Original Subordinate
Principal Balance, (c) commencing with the Distribution Date on the seventh
anniversary of the first Distribution Date, 40% of the Original Subordinate
Principal Balance, (d) commencing with the Distribution Date on the eighth
anniversary of the first Distribution Date, 45% of the Original Subordinate
Principal Balance, and (e) commencing with the Distribution Date on the ninth
anniversary of the first Distribution Date, 50% of the Original Subordinate
Principal Balance.
Senior Termination Date: For any Senior Certificate Group, the
Distribution Date on which the aggregate Class Certificate Balance of the
Senior Certificates in such Senior Certificate Group (other than the related
Class PO Component) has been reduced to zero.
Servicing Advances: All customary, reasonable and necessary "out
of pocket" costs and expenses incurred in the performance by the Master
Servicer of its servicing obligations, including, but not limited to, the cost
of (i) the preservation, restoration and protection of a Mortgaged Property,
(ii) any expenses reimbursable to the Master Servicer pursuant to Section 3.11
and any enforcement or judicial proceedings, including foreclosures, (iii) the
management and liquidation of any REO Property and (iv) compliance with the
obligations under Section 3.09.
Servicing Criteria: The "servicing criteria" set forth in Item
1122(d) of Regulation AB.
Servicing Officer: Any officer of the Master Servicer involved in,
or responsible for, the administration and servicing of the Mortgage Loans
whose name and facsimile signature appear on a list of servicing officers
furnished to the Trustee by the Master Servicer on the Closing Date pursuant
to this Agreement, as such list may from time to time be amended.
Shift Percentage: As to any Distribution Date occurring during the
five years beginning on the first Distribution Date, 0%. For any Distribution
Date occurring on or after the fifth anniversary of the first Distribution
Date as follows: for any Distribution Date in the first year thereafter, 30%;
for any Distribution Date in the second year thereafter, 40%; for any
Distribution Date in the third year thereafter,
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60%; for any Distribution Date in the fourth year thereafter, 80%; and for any
Distribution Date thereafter, 100%.
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) minus 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) any Realized Loss
previously incurred in connection with a Deficient Valuation. The Stated
Principal Balance of any Mortgage Loan that becomes a Liquidated Mortgage Loan
will be zero on each date following the Due Period in which such Mortgage Loan
becomes a Liquidated Mortgage Loan.
Streamlined Documentation Mortgage Loan: Any Mortgage Loan
originated pursuant to Countrywide's Streamlined Loan Documentation Program
then in effect. For the purposes of this Agreement, a Mortgagor is eligible
for a mortgage pursuant to Countrywide's Streamlined Loan Documentation
Program if that Mortgagor is refinancing an existing mortgage loan that was
originated or acquired by Countrywide where, among other things, the mortgage
loan has not been more than 30 days delinquent in payment during the previous
twelve-month period.
Strike Rate: With respect to each Class of Covered Certificates,
the applicable percentage set forth below:
-------------------------------------------
Class of Certificates Strike Rate
--------------------- -----------
-------------------------------------------
Class 1-A-6 5.40%
-------------------------------------------
Class 1-A-15 5.35%
-------------------------------------------
Class 1-A-19 5.65%
-------------------------------------------
Class 1-A-21 5.46%
-------------------------------------------
Class 1-A-23 5.45%
-------------------------------------------
Class 2-A-5 5.48%
-------------------------------------------
Subcontractor: Any vendor, subcontractor or other Person that is
not responsible for the overall servicing (as "servicing" is commonly
understood by participants in the mortgage-backed securities market) of
Mortgage Loans but performs one or more discrete functions identified in Item
1122(d) of Regulation AB with respect to Mortgage Loans under the direction or
authority of the Master Servicer or a Subservicer or the Trustee, as the case
may be.
Subordinated Certificates: As specified in the Preliminary
Statement.
Subordinated Percentage: As to any Loan Group and Distribution
Date on or prior to a Senior Termination Date, 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 a Senior Termination
Date, 100% minus the Senior Percentage for such Distribution Date.
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Subordinated Portion: For any Distribution Date, an amount equal
to the aggregate Stated Principal Balance of the Mortgage Loans in the related
Loan Group as of the end of the Prepayment Period related to the immediately
preceding Distribution Date, minus the aggregate Class Certificate Balance of
the related 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 Loan Group, an amount equal to the excess of (A) the
sum, not less than zero, of (i) the Subordinated Percentage of the applicable
Non-PO Percentage for such Loan Group of all amounts described in subclauses
(a) through (d) of clause (i) of the definition of "Non-PO Formula Principal
Amount" for such Distribution Date, (ii) with respect to each Mortgage Loan
that became a Liquidated Mortgage Loan during the calendar month preceding the
month of such Distribution Date, the applicable Non-PO Percentage of the
amount of the Liquidation Proceeds allocated to principal received with
respect thereto remaining after application thereof pursuant to clause (ii) of
the definition of Senior Principal Distribution Amount, up to the Subordinated
Percentage for such Loan Group of the applicable Non-PO Percentage of the
Stated Principal Balance of such Mortgage Loan, (iii) the Subordinated
Prepayment Percentage of the applicable Non-PO Percentage of all amounts
described in subclause (f) of clause (i) of the definition of "Non-PO Formula
Principal Amount" for such Loan Group and Distribution Date, and (iv) the
related Subordinated Prepayment Percentage of any Subsequent Recoveries
described in clause (ii) of the definition of "Non-PO Formula Principal
Amount" for such Distribution Date, over (B) the amount of any payments in
respect of Class PO Deferred Amounts for the related Class PO Component on the
related Distribution Date, provided, however, that on any Distribution Date
after a 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 or Subordinated Prepayment Percentage, as applicable,
for the Subordinated Certificates for such Distribution Date with respect to
all of the Mortgage Loans as opposed to the Mortgage Loans 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 hereof.
Substitute Mortgage Loan: A Mortgage Loan substituted by a Seller
for a Deleted Mortgage Loan which must, on the date of such substitution, as
confirmed in a Request for Release, substantially in the form of Exhibit M,
(i) have a Stated Principal Balance, after deduction of the principal portion
of the Scheduled Payment due in the month of substitution, not in excess of,
and not more than 10% less than the Stated Principal Balance of the Deleted
Mortgage Loan; (ii) be accruing interest at a rate no lower than and not more
than 1% per annum higher than, that of the Deleted Mortgage Loan; (iii) have a
Loan-to-Value Ratio no higher than that of the Deleted Mortgage Loan; (iv)
have a remaining term to maturity no greater than (and not more than one year
less than that of) the Deleted Mortgage Loan; (v) not be a Cooperative Loan
unless the Deleted Mortgage Loan was a Cooperative Loan and (vi) comply with
each representation and warranty set forth in Section 2.03 hereof.
Substitution Adjustment Amount: The meaning ascribed to such term
pursuant to Section 2.03.
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Supplemental Interest Trust: The separate trust created under this
Agreement pursuant to Section 3.05(g).
Supplemental Interest Trustee: The Bank of New York, a New York
banking corporation, not in its individual capacity, but solely in its
capacity as trustee of the Supplemental Interest Trust for the benefit of the
Holders of the Covered Certificates under this Agreement, and any successor
thereto, and any corporation or national banking association resulting from or
surviving any consolidation or merger to which it or its successors may be a
party and any successor trustee as may from time to time be serving as
successor trustee hereunder.
Targeted Balance: With respect to any group of Targeted Principal
Classes or Components in the aggregate and any Distribution Date appearing in
Schedule V hereto, the Aggregate Targeted Balance for such group and
Distribution Date. With respect to any other Targeted Principal Class or
Component and any Distribution Date appearing in Schedule V hereto, the
applicable amount appearing opposite such Distribution Date for such Class or
Component.
Targeted Principal Classes: As specified in the Preliminary
Statement.
Tax Matters Person: The person designated as "tax matters
person" in the manner provided under Treasury regulation ss. 1.860F-4(d) and
Treasury regulation ss. 301.6231(a)(7)-1. Initially, the Tax Matters Person
shall be the Trustee.
Tax Matters Person Certificate: The Class A-R Certificate with a
Denomination of $0.01.
Transaction Documents: This Agreement, the Corridor Contracts, and
any other document or agreement entered into in connection with the Trust
Fund, the Certificates or the Mortgage Loans.
Transfer: Any direct or indirect transfer or sale of any
Ownership Interest in a Residual Certificate.
Trust Fund: The corpus of the trust created hereunder consisting
of (i) the Mortgage Loans and all interest and principal received on or with
respect thereto after the Cut-off Date to the extent not applied in computing
the Cut-off Date Principal Balance thereof; (ii) the Certificate Account, the
Distribution Account, the Exchangeable Certificates 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; and (iv) all
proceeds of the conversion, voluntary or involuntary, of any of the foregoing.
For the avoidance of doubt, the ES Trust, the Master REMIC and the Lower Tier
REMIC and the assets held or deemed held thereby shall constitute a part of
the Trust Fund.
Trustee: The Bank of New York and its successors and, if a
successor trustee is appointed hereunder, such successor.
Trustee Advance Rate: With respect to any Advance made by the
Trustee pursuant to Section 4.01(b), a per annum rate of interest determined
as of the date of such Advance equal to the Prime Rate in effect on such date
plus 5.00%.
Trustee Fee: As to any Distribution Date, an amount equal to
one-twelfth of the Trustee Fee Rate multiplied by the Pool Stated Principal
Balance with respect to such Distribution Date.
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Trustee Fee Rate: With respect to each Mortgage Loan, 0.009% per
annum.
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(s): As specified in the Preliminary Statement.
Unscheduled Principal Distribution Amount: With respect to any
Distribution Date, an amount equal to the sum of (i) with respect to each
Mortgage Loan that became a Liquidated Mortgage Loan during the calendar month
preceding the month of such Distribution Date, the applicable Non-PO
Percentage of the Liquidation Proceeds allocable to principal received with
respect to such Mortgage Loan and (ii) the applicable Non-PO Percentage of the
amount described in subclause (f) of clause (i) of the definition of Non-PO
Formula Principal Amount for such Distribution Date and (iii) any Subsequent
Recoveries described in clause (ii) of the definition of Non-PO Formula
Principal Amount for such Distribution Date.
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
Senior Certificates that are 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 such Class of
Notional Amount Certificates) shall be allocated among Holders of the
remaining Classes of Senior and Subordinated Certificates in proportion to the
Certificate Balances of their respective Certificates on such date. Each Class
of Exchangeable Certificates will be allocated a proportionate share of the
Voting Rights allocated to the related Class or Classes of Depositable
Certificates that have been surrendered as provided in Section 5.07(e).
Yield Supplement Amount: For any Distribution Date and Class of
Covered Certificates on or prior to the applicable Corridor Contract
Termination Date, interest for the related Interest Accrual Period on the
Class Certificate Balance of such Class of Covered Certificates immediately
prior to such Distribution Date at a rate equal to the excess, if any, of (i)
the lesser of LIBOR and the applicable Ceiling Rate over (ii) the applicable
Strike Rate.
SECTION 1.02. Certain Interpretive Provisions
All terms defined in this Agreement shall have the defined
meanings when used in any certificate, agreement or other document delivered
pursuant hereto unless otherwise defined therein. For purposes of this
Agreement and all such certificates and other documents, unless the context
otherwise requires: (a) accounting terms not otherwise defined in this
Agreement, and accounting terms partly defined in this Agreement to the extent
not defined, shall have the respective meanings given to them under generally
accepted accounting principles; (b) the words "hereof," "herein" and
"hereunder" and words of similar import refer to this Agreement (or the
certificate, agreement or other document in which they are used) as a whole
and not to any particular provision of this Agreement (or such certificate,
agreement or document); (c) references to any Section, Schedule or Exhibit are
references to Sections, Schedules and Exhibits in or to this Agreement, and
references to any paragraph, subsection, clause or other subdivision within
any Section or definition refer to such paragraph, subsection, clause or other
subdivision of such Section or definition; (d) the term "including" means
"including without limitation"; (e) references to any law or regulation refer
to that law or regulation as amended from time to time and
I-35
include any successor law or regulation; (f) references to any agreement refer
to that agreement as amended from time to time; (g) references to any Person
include that Person's permitted successors and assigns; and (h) a Mortgage
Loan is "30 days delinquent" if any Scheduled Payment has not been received by
the close of business on the day immediately preceding the Due Date on which
the next Scheduled Payment is due. Similarly for "60 days delinquent," "90
days delinquent" and so on.
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ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
SECTION 2.01. Conveyance of Mortgage Loans.
(a) Each Seller concurrently with the execution and delivery
hereof, hereby sells, transfers, assigns, sets over and otherwise conveys to
the Depositor, without recourse, all its respective right, title and interest
in and to the related Mortgage Loans, including all interest and principal
received or receivable by such Seller, on or with respect to the Mortgage
Loans after the Cut-off Date and all interest and principal payments on the
related Mortgage Loans received prior to the Cut-off Date in respect of
installments of interest and principal due thereafter, but not including
payments of principal and interest due and payable on such Mortgage Loans, on
or before the Cut-off Date. On or prior to the Closing Date, Countrywide shall
deliver to the Depositor or, at the Depositor's direction, to the Trustee or
other designee of the Depositor, the Mortgage File for each Mortgage Loan
listed in the Mortgage Loan Schedule (except that, in the case of the Delay
Delivery Mortgage Loans (which may include Countrywide Mortgage Loans, Park
Granada Mortgage Loans, Park Monaco Mortgage Loans and Park Sienna Mortgage
Loans), such delivery may take place within thirty (30) days following the
Closing Date). Such delivery of the Mortgage Files shall be made against
payment by the Depositor of the purchase price, previously agreed to by the
Sellers and Depositor, for the Mortgage Loans. With respect to any Mortgage
Loan that does not have a first payment date on or before the Due Date in the
month of the first Distribution Date, Countrywide shall deposit into the
Distribution Account on or before the Distribution Account Deposit Date
relating to the first 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.
(b) Immediately upon the conveyance of the Mortgage Loans referred
to in clause (a), the Depositor sells, transfers, assigns, sets over and
otherwise conveys to the Trustee for the benefit of the Certificateholders,
without recourse, all the right, title and interest of the Depositor in and to
the Trust Fund together with the Depositor's right to require each Seller to
cure any breach of a representation or warranty made herein by such Seller, or
to repurchase or substitute for any affected Mortgage Loan in accordance
herewith.
(c) In connection with the transfer and assignment set forth in
clause (b) above, the Depositor has delivered or caused to be delivered to the
Trustee (or, in the case of the Delay Delivery Mortgage Loans, will deliver or
cause to be delivered to the Trustee within thirty (30) days following the
Closing Date) for the benefit of the Certificateholders the following
documents or instruments with respect to each Mortgage Loan so assigned:
(i) (A) the original Mortgage Note endorsed by manual or facsimile
signature in blank in the following form: "Pay to the order of
____________ without recourse," with all intervening endorsements
showing a complete chain of endorsement from the originator to the
Person endorsing the Mortgage Note (each such endorsement being
sufficient to transfer all right, title and interest of the party so
endorsing, as noteholder or assignee thereof, in and to that Mortgage
Note); or
(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;
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(ii) except as provided below and for each Mortgage Loan
that is not a MERS Mortgage Loan, the original recorded Mortgage
or a copy of such Mortgage, with recording information, 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,
or a copy of such mortgage, with recording information, noting the
presence of the MIN of the Mortgage Loans and either language
indicating that the Mortgage Loan is a MOM Loan if the Mortgage
Loan is a MOM Loan or if the Mortgage Loan was not a MOM Loan at
origination, the original Mortgage and the assignment thereof to
MERS, with evidence of recording indicated thereon, or a copy of
the Mortgage certified by the public recording office in which
such Mortgage has been recorded;
(iii) in the case of each Mortgage Loan that is not a MERS
Mortgage Loan, a duly executed assignment of the Mortgage, or a
copy of such assignment, with recording information, (which may be
included in a blanket assignment or assignments), together with,
except as provided below, all interim recorded assignments of such
mortgage or a copy of such assignment, with recording information,
(each such assignment, when duly and validly completed, to be in
recordable form and sufficient to effect the assignment of and
transfer to the assignee thereof, under the Mortgage to which the
assignment relates); provided that, if the related Mortgage has
not been returned from the applicable public recording office,
such assignment of the Mortgage may exclude the information to be
provided by the recording office; provided, further, that such
assignment of Mortgage need not be delivered in the case of a
Mortgage for which the related Mortgaged Property is located in
the Commonwealth of Puerto Rico;
(iv) the original or copies of each assumption,
modification, written assurance or substitution agreement, if any;
(v) except as provided below, the original or duplicate
original lender's title policy or a printout of the electronic
equivalent and all riders thereto; and
(vi) in the case of a Cooperative Loan, the originals of the
following documents or instruments:
(A) The Coop Shares, together with a stock power in
blank;
(B) The executed Security Agreement;
(C) The executed Proprietary Lease;
(D) The executed Recognition Agreement;
(E) The executed UCC-1 financing statement with
evidence of recording thereon which have been filed in all
places required to perfect the Seller's interest in the Coop
Shares and the Proprietary Lease; and
(F) The executed UCC-3 financing statements or other
appropriate UCC financing statements required by state law,
evidencing a complete and unbroken line from the mortgagee
to the Trustee with evidence of recording thereon (or in a
form suitable for recordation).
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In addition, in connection with the assignment of any MERS
Mortgage Loan, each Seller agrees that it will cause, at the Trustee's
expense, the MERS(R) System to indicate that the Mortgage Loans sold by such
Seller to the Depositor have been assigned by that Seller to the Trustee in
accordance with this Agreement for the benefit of the Certificateholders by
including (or deleting, in the case of Mortgage Loans which are repurchased in
accordance with this Agreement) in such computer files the information
required by the MERS(R) System to identify the series of the Certificates
issued in connection with such Mortgage Loans. Each Seller further agrees that
it will not, and will not permit the Master Servicer to, and the Master
Servicer agrees that it will not, alter the information referenced in this
paragraph with respect to any Mortgage Loan sold by such Seller to the
Depositor during the term of this Agreement unless and until such Mortgage
Loan is repurchased in accordance with the terms of this Agreement.
In the event that in connection with any Mortgage Loan that is not
a MERS Mortgage Loan the Depositor cannot deliver (a) the original recorded
Mortgage, or a copy of such Mortgage, with recording information, (b) all
interim recorded assignments, or a copy of such assignments, with recording
information or (c) the lender's title policy or a copy of 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 of this Agreement because such document or documents have not
been returned from the applicable public recording office in the case of
clause (ii) or (iii) above, or because the title policy has not been delivered
to either the Master Servicer or the Depositor by the applicable title insurer
in the case of clause (v) above, the Depositor shall promptly deliver to the
Trustee, in the case of clause (ii) or (iii) above, such original Mortgage or
a copy of such Mortgage, with recording information, or such interim
assignment or a copy of such assignment, with recording information, as the
case may be, with evidence of recording indicated thereon upon receipt thereof
from the public recording office, or a copy thereof, certified, if
appropriate, by the relevant recording office, but in no event shall any such
delivery of the original Mortgage and each such interim assignment or a copy
thereof, certified, if appropriate, by the relevant recording office, be made
later than one year following the Closing Date, or, in the case of clause (v)
above, no later than 120 days following the Closing Date; provided, however,
in the event the Depositor is unable to deliver by such date each Mortgage and
each such interim assignment by reason of the fact that any such documents
have not been returned by the appropriate recording office, or, in the case of
each such interim assignment, because the related Mortgage has not been
returned by the appropriate recording office, the Depositor shall deliver such
documents to the Trustee as promptly as possible upon receipt thereof and, in
any event, within 720 days following the Closing Date. The Depositor shall
forward or cause to be forwarded to the Trustee (a) from time to time
additional original 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 one-hundred and twenty (120) days after
such transfer and assignment, the Trustee shall (A) as the assignee thereof,
affix the following language to each assignment of Mortgage: "CWALT Series
2007-5CB, The Bank of New York, as trustee", (B) cause such assignment to be
in proper form for recording in the appropriate public office for real
property records and (C) cause to be delivered for recording in the
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appropriate public office for real property records the assignments of the
Mortgages to the Trustee, except that, (i) 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 (ii) the Trustee need not cause to be recorded any
assignment which relates to a Mortgage Loan, the Mortgaged Property and
Mortgage File relating to which are located in any jurisdiction (including
Puerto Rico) under the laws of which the recordation of such assignment is not
necessary to protect the Trustee's and the Certificateholders' interest in the
related Mortgage Loan as evidenced by an opinion of counsel delivered by
Countrywide to the Trustee within 90 days of the Closing Date (which opinion
may be in the form of a "survey" opinion and is not required to be delivered
by counsel admitted to practice law in the jurisdiction as to which such legal
opinion applies).
In the case of Mortgage Loans that have been prepaid in full as of
the Closing Date, the Depositor, in lieu of delivering the above documents to
the Trustee, will deposit in the Certificate Account the portion of such
payment that is required to be deposited in the Certificate Account pursuant
to Section 3.05 hereof.
Notwithstanding anything to the contrary in this Agreement, within
thirty (30) days after the Closing Date, Countrywide (on its own behalf and on
behalf of Park Granada, Park Monaco and Park Sienna) shall either (i) deliver
to the Depositor, or at the Depositor's direction, to the Trustee or other
designee of the Depositor the Mortgage File as required pursuant to this
Section 2.01 for each Delay Delivery Mortgage Loan or (ii) either (A)
substitute a Substitute Mortgage Loan for the Delay Delivery Mortgage Loan or
(B) repurchase the Delay Delivery Mortgage Loan, which substitution or
repurchase shall be accomplished in the manner and subject to the conditions
set forth in Section 2.03 (treating each Delay Delivery Mortgage Loan as a
Deleted Mortgage Loan for purposes of such Section 2.03); provided, however,
that if Countrywide fails to deliver a Mortgage File for any Delay Delivery
Mortgage Loan within the thirty (30) day period provided in the prior
sentence, Countrywide (on its own behalf and on behalf of Park Granada, Park
Monaco and Park Sienna) shall use its best reasonable efforts to effect a
substitution, rather than a repurchase of, such Deleted Mortgage Loan and
provided further that the cure period provided for in Section 2.02 or in
Section 2.03 shall not apply to the initial delivery of the Mortgage File for
such Delay Delivery Mortgage Loan, but rather Countrywide (on its own behalf
and on behalf of Park Granada, Park Monaco and Park Sienna) shall have five
(5) Business Days to cure such failure to deliver. At the end of such thirty
(30) day period the Trustee shall send a Delay Delivery Certification for the
Delay Delivery Mortgage Loans delivered during such thirty (30) day period in
accordance with the provisions of Section 2.02.
(d) Neither the Depositor nor the Trust will acquire or hold any
Mortgage Loan that would violate the representations made by Countrywide set
forth in clause (49) of Schedule III-A hereto.
SECTION 2.02. Acceptance by Trustee of the Mortgage Loans.
(a) The Trustee acknowledges receipt of the documents identified
in the Initial Certification in the form annexed hereto as Exhibit F-1 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
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Park Sienna) an Initial Certification in the form annexed hereto as Exhibit
F-1. Based on its review and examination, and only as to the documents
identified in such Initial Certification, the Trustee acknowledges that such
documents appear regular on their face and relate to such Mortgage Loan. The
Trustee shall be under no duty or obligation to inspect, review or examine
said documents, instruments, certificates or other papers to determine that
the same are genuine, enforceable or appropriate for the represented purpose
or that they have actually been recorded in the real estate records or that
they are other than what they purport to be on their face.
On or about the thirtieth (30th) day after the Closing Date, the
Trustee shall deliver to the Depositor, the Master Servicer and Countrywide
(on its own behalf and on behalf of Park Granada, Park Monaco and Park Sienna)
a Delay Delivery Certification with respect to the Mortgage Loans in the form
annexed hereto as Exhibit G-1, with any applicable exceptions noted thereon.
Not later than 90 days after the Closing Date, the Trustee shall
deliver to the Depositor, the Master Servicer and Countrywide (on its own
behalf and on behalf of Park Granada, Park Monaco and Park Sienna) a Final
Certification with respect to the Mortgage Loans in the form annexed hereto as
Exhibit H-1, with any applicable exceptions noted thereon. If, in the course
of such review, the Trustee finds any document constituting a part of a
Mortgage File which does not meet the requirements of Section 2.01, the
Trustee shall list such as an exception in the Final Certification; provided,
however that the Trustee shall not make any determination as to whether (i)
any endorsement is sufficient to transfer all right, title and interest of the
party so endorsing, as noteholder or assignee thereof, in and to that Mortgage
Note or (ii) any assignment is in recordable form or is sufficient to effect
the assignment of and transfer to the assignee thereof under the mortgage to
which the assignment relates. Countrywide (on its own behalf and on behalf of
Park Granada, Park Monaco and Park Sienna) shall promptly correct or cure such
defect within 90 days from the date it was so notified of such defect and, if
Countrywide does not correct or cure such defect within such period,
Countrywide (on its own behalf and on behalf of Park Granada, Park Monaco and
Park Sienna) shall either (a) substitute for the related Mortgage Loan a
Substitute Mortgage Loan, which substitution shall be accomplished in the
manner and subject to the conditions set forth in Section 2.03, or (b)
purchase such Mortgage Loan from the Trustee within 90 days from the date
Countrywide (on its own behalf and on behalf of Park Granada, Park Monaco and
Park Sienna) was notified of such defect in writing at the Purchase Price of
such Mortgage Loan; provided, however, that in no event shall such
substitution or purchase occur more than 540 days from the Closing Date,
except that if the substitution or purchase of a Mortgage Loan pursuant to
this provision is required by reason of a delay in delivery of any documents
by the appropriate recording office, and there is a dispute between either the
Master Servicer or Countrywide (on its own behalf and on behalf of Park
Granada, Park Monaco and Park Sienna) and the Trustee over the location or
status of the recorded document, then such substitution or purchase shall
occur within 720 days from the Closing Date. The Trustee shall deliver written
notice to each Rating Agency within 270 days from the Closing Date indicating
each Mortgage Loan (a) which has not been returned by the appropriate
recording office or (b) as to which there is a dispute as to location or
status of such Mortgage Loan. Such notice shall be delivered every 90 days
thereafter until the related Mortgage Loan is returned to the Trustee. Any
such substitution pursuant to (a) above or purchase pursuant to (b) above
shall not be effected prior to the delivery to the Trustee of the Opinion of
Counsel required by Section 2.05 hereof, if any, and any substitution pursuant
to (a) above shall not be effected prior to the additional delivery to the
Trustee of a Request for Release substantially in the form of Exhibit N. No
substitution is permitted to be made in any calendar month after the
Determination Date for such month. The Purchase Price for any such Mortgage
Loan shall be deposited by Countrywide (on its own behalf and on behalf of
Park Granada, Park Monaco and Park Sienna) in the Certificate Account on or
prior to the Distribution Account Deposit Date for the Distribution Date in
the month following the month of repurchase and, upon receipt of such deposit
and certification with respect thereto in the form of Exhibit N hereto, the
Trustee shall release the related Mortgage File to Countrywide (on its own
behalf and on behalf of Park Granada, Park Monaco and Park
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Sienna) and shall execute and deliver at Countrywide's (on its own behalf and
on behalf of Park Granada, Park Monaco and Park Sienna) request such
instruments of transfer or assignment prepared by Countrywide, in each case
without recourse, as shall be necessary to vest in Countrywide (on its own
behalf and on behalf of Park Granada, Park Monaco and Park Sienna), or its
designee, the Trustee's interest in any Mortgage Loan released pursuant
hereto. If pursuant to the foregoing provisions Countrywide (on its own behalf
and on behalf of Park Granada, Park Monaco and Park Sienna) repurchases an
Mortgage Loan that is a MERS Mortgage Loan, the Master Servicer shall either
(i) cause MERS to execute and deliver an assignment of the Mortgage in
recordable form to transfer the Mortgage from MERS to Countrywide (on its own
behalf and on behalf of Park Granada, Park Monaco and Park Sienna) or its
designee and shall cause such Mortgage to be removed from registration on the
MERS(R) System in accordance with MERS' rules and regulations or (ii) cause
MERS to designate on the MERS(R) System Countrywide (on its own behalf and on
behalf of Park Granada, Park Monaco and Park Sienna) or its designee as the
beneficial holder of such Mortgage Loan.
(b) [Reserved].
(c) The Trustee shall retain possession and custody of each
Mortgage File in accordance with and subject to the terms and conditions set
forth herein. The Master Servicer shall promptly deliver to the Trustee, upon
the execution or receipt thereof, the originals of such other documents or
instruments constituting the Mortgage File as come into the possession of the
Master Servicer from time to time.
(d) It is understood and agreed that the respective obligations of
each Seller to substitute for or to purchase any Mortgage Loan sold to the
Depositor by it which does not meet the requirements of Section 2.01 above
shall constitute the sole remedy respecting such defect available to the
Trustee, the Depositor and any Certificateholder against that Seller.
(e) [Reserved].
(f) [Reserved].
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 all of the Mortgage Loans, and
(iii) Schedule III-B hereto, and by this reference incorporated herein, to the
Depositor, the Master Servicer and the Trustee, as of the Closing Date, or if
so specified therein, as of the Cut-off Date with respect to the Mortgage
Loans that are Countrywide Mortgage Loans. Park Granada hereby makes the
representations and warranties set forth in (i) Schedule II-B hereto, and by
this reference incorporated herein, to the Depositor, the Master Servicer and
the Trustee, as of the Closing Date and (ii) Schedule III-C hereto, and by
this reference incorporated herein, to the Depositor, the Master Servicer and
the Trustee, as of the Closing Date, or if so specified therein, as of the
Cut-off Date with respect to the Mortgage Loans that are Park Granada Mortgage
Loans. Park Monaco hereby makes the representations and warranties set forth
in (i) Schedule II-C hereto, and by this reference incorporated herein, to the
Depositor, the Master Servicer and the Trustee, as of the Closing Date and
(ii) Schedule III-D hereto, and by this reference incorporated herein, to the
Depositor, the Master Servicer and the Trustee, as of the Closing Date, or if
so specified therein, as of the Cut-off Date with respect to the Mortgage
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Loans that are Park Monaco Mortgage Loans. Park Sienna hereby makes the
representations and warranties set forth in (i) Schedule II-D hereto, and by
this reference incorporated herein, to the Depositor, the Master Servicer and
the Trustee, as of the Closing Date and (ii) Schedule III-E hereto, and by
this reference incorporated herein, to the Depositor, the Master Servicer and
the Trustee, as of the Closing Date, or if so specified therein, as of the
Cut-off Date with respect to the Mortgage Loans that are Park Sienna Mortgage
Loans.
(b) The Master Servicer hereby makes the representations and
warranties set forth in Schedule IV hereto, and by this reference incorporated
herein, to the Depositor and the Trustee, as of the Closing Date.
(c) Upon discovery by any of the parties hereto of a breach of a
representation or warranty with respect to a Mortgage Loan made pursuant to
Section 2.03(a) that materially and adversely affects the interests of the
Certificateholders in that Mortgage Loan, the party discovering such breach
shall give prompt notice thereof to the other parties. Each Seller hereby
covenants that within 90 days of the earlier of its discovery or its receipt
of written notice from any party of a breach of any representation or warranty
with respect to a Mortgage Loan sold by it pursuant to Section 2.03(a) which
materially and adversely affects the interests of the Certificateholders in
that Mortgage Loan, it shall cure such breach in all material respects, and if
such breach is not so cured, shall, (i) if such 90-day period expires prior to
the second anniversary of the Closing Date, remove such Mortgage Loan (a
"Deleted Mortgage Loan") from the Trust Fund and substitute in its place a
Substitute Mortgage Loan, in the manner and subject to the conditions set
forth in this Section; or (ii) repurchase the affected Mortgage Loan or
Mortgage Loans from the Trustee at the Purchase Price in the manner set forth
below; provided, however, that any such substitution pursuant to (i) above
shall not be effected prior to the delivery to the Trustee of the Opinion of
Counsel required by Section 2.05 hereof, if any, and any such substitution
pursuant to (i) above shall not be effected prior to the additional delivery
to the Trustee of a Request for Release substantially in the form of Exhibit N
and the Mortgage File for any such Substitute Mortgage Loan. The Seller
repurchasing a Mortgage Loan pursuant to this Section 2.03(c) shall promptly
reimburse the Master Servicer and the Trustee for any expenses reasonably
incurred by the Master Servicer or the Trustee in respect of enforcing the
remedies for such breach. With respect to the representations and warranties
described in this Section which are made to the best of a Seller's knowledge,
if it is discovered by either the Depositor, a Seller or the Trustee that the
substance of such representation and warranty is inaccurate and such
inaccuracy materially and adversely affects the value of the related Mortgage
Loan or the interests of the Certificateholders therein, notwithstanding that
Seller's lack of knowledge with respect to the substance of such
representation or warranty, such inaccuracy shall be deemed a breach of the
applicable representation or warranty. Any breach of a representation set
forth in clauses (45) through (64) of Schedule III-A with respect to a
Mortgage Loan 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
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Mortgage Loan and the substitution of the Substitute Mortgage Loan or Loans
and the Master Servicer shall deliver the amended Mortgage Loan Schedule to
the Trustee. Upon such substitution, the Substitute Mortgage Loan or Loans
shall be subject to the terms of this Agreement in all respects, and the
related Seller shall be deemed to have made with respect to such Substitute
Mortgage Loan or Loans, as of the date of substitution, the representations
and warranties made pursuant to Section 2.03(a) with respect to such Mortgage
Loan. Upon any such substitution and the deposit to the Certificate Account of
the amount required to be deposited therein in connection with such
substitution as described in the following paragraph, the Trustee shall
release the Mortgage File held for the benefit of the Certificateholders
relating to such Deleted Mortgage Loan to the related Seller and shall execute
and deliver at such Seller's direction such instruments of transfer or
assignment prepared by Countrywide (on its own behalf and on behalf of Park
Granada, Park Monaco and Park Sienna), in each case without recourse, as shall
be necessary to vest title in that Seller, or its designee, the Trustee's
interest in any Deleted Mortgage Loan substituted for pursuant to this Section
2.03.
For any month in which a Seller substitutes one or more Substitute
Mortgage Loans for one or more Deleted Mortgage Loans, the Master Servicer
will determine the amount (if any) by which the aggregate principal balance of
all Substitute Mortgage Loans sold to the Depositor by that Seller as of the
date of substitution is less than the aggregate Stated Principal Balance of
all Deleted Mortgage Loans repurchased by that Seller (after application of
the scheduled principal portion of the monthly payments due in the month of
substitution). The amount of such shortage (the "Substitution Adjustment
Amount") plus an amount equal to the aggregate of any unreimbursed Advances
with respect to such Deleted Mortgage Loans shall be deposited in the
Certificate Account by Countrywide (on its own behalf and on behalf of Park
Granada, Park Monaco and Park Sienna) on or before the Distribution Account
Deposit Date for the Distribution Date in the month succeeding the calendar
month during which the related Mortgage Loan became required to be purchased
or replaced hereunder.
In the event that a Seller shall have repurchased a Mortgage Loan,
the Purchase Price therefor shall be deposited in the Certificate Account
pursuant to Section 3.05 on or before the Distribution Account Deposit Date
for the Distribution Date in the month following the month during which that
Seller became obligated hereunder to repurchase or replace such Mortgage Loan
and upon such deposit of the Purchase Price, the delivery of the Opinion of
Counsel required by Section 2.05 and receipt of a Request for Release in the
form of Exhibit N hereto, the Trustee shall release the related Mortgage File
held for the benefit of the Certificateholders to such Person, and the Trustee
shall execute and deliver at such Person's direction such instruments of
transfer or assignment prepared by such Person, in each case without recourse,
as shall be necessary to transfer title from the Trustee. It is understood and
agreed that the obligation under this Agreement of any Person to cure,
repurchase or replace any Mortgage Loan as to which a breach has occurred and
is continuing shall constitute the sole remedy against such Persons respecting
such breach available to Certificateholders, the Depositor or the Trustee on
their behalf.
The representations and warranties made pursuant to this Section
2.03 shall survive delivery of the respective Mortgage Files to the Trustee
for the benefit of the Certificateholders.
SECTION 2.04. Representations and Warranties of the Depositor as
to the Mortgage Loans.
The Depositor hereby represents and warrants to the Trustee with
respect to each Mortgage Loan as of the date hereof or such other date set
forth herein that as of the Closing Date, and following the transfer of the
Mortgage Loans to it by each Seller, the Depositor had good title to the
Mortgage Loans and the Mortgage Notes were subject to no offsets, defenses or
counterclaims.
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The Depositor hereby assigns, transfers and conveys to the Trustee
all of its rights with respect to the Mortgage Loans including, without
limitation, the representations and warranties of each Seller made pursuant to
Section 2.03(a)(ii) hereof, together with all rights of the Depositor to
require each Seller to cure any breach thereof or to repurchase or substitute
for any affected Mortgage Loan in accordance with this Agreement.
It is understood and agreed that the representations and
warranties set forth in this Section 2.04 shall survive delivery of the
Mortgage Files to the Trustee. Upon discovery by the Depositor or the Trustee
of a breach of any of the foregoing representations and warranties set forth
in this Section 2.04 (referred to herein as a "breach"), which breach
materially and adversely affects the interest of the Certificateholders, the
party discovering such breach shall give prompt written notice to the others
and to each Rating Agency.
SECTION 2.05. Delivery of Opinion of Counsel in Connection with
Substitutions.
(a) Notwithstanding any contrary provision of this Agreement, no
substitution pursuant to Section 2.02 or Section 2.03 shall be made more than
90 days after the Closing Date unless Countrywide delivers to the Trustee an
Opinion of Counsel, which Opinion of Counsel shall not be at the expense of
either the Trustee or the Trust Fund, addressed to the Trustee, to the effect
that such substitution will not (i) result in the imposition of the tax on
"prohibited transactions" on the Trust Fund or contributions after the Startup
Date, as defined in Sections 860F(a)(2) and 860G(d) of the Code, respectively,
or (ii) cause each REMIC created hereunder to fail to qualify as a REMIC at
any time that any Certificates are outstanding.
(b) Upon discovery by the Depositor, a Seller, the Master
Servicer, or the Trustee that any Mortgage Loan does not constitute a
"qualified mortgage" within the meaning of Section 860G(a)(3) of the Code, the
party discovering such fact shall promptly (and in any event within five (5)
Business Days of discovery) give written notice thereof to the other parties.
In connection therewith, the Trustee shall require Countrywide (on its own
behalf and on behalf of Park Granada, Park Monaco and Park Sienna), at its
option, to either (i) substitute, if the conditions in Section 2.03(c) with
respect to substitutions are satisfied, a Substitute Mortgage Loan for the
affected Mortgage Loan, or (ii) repurchase the affected Mortgage Loan within
90 days of such discovery in the same manner as it would a Mortgage Loan for a
breach of representation or warranty made pursuant to Section 2.03. The
Trustee shall reconvey to Countrywide the Mortgage Loan to be released
pursuant hereto in the same manner, and on the same terms and conditions, as
it would a Mortgage Loan repurchased for breach of a representation or
warranty contained in Section 2.03.
SECTION 2.06. Execution and Delivery of Certificates.
The Trustee acknowledges the transfer and assignment to it of the
Trust Fund and, concurrently with such transfer and assignment, has executed
and delivered to or upon the order of the Depositor, the Certificates in
authorized denominations evidencing directly or indirectly the entire
ownership of the Trust Fund. The Trustee agrees to hold the Trust Fund and
exercise the rights referred to above for the benefit of all present and
future Holders of the Certificates and to perform the duties set forth in this
Agreement, to the end that the interests of the Holders of the Certificates
may be adequately and effectively protected.
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
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REMIC Provisions shall be the Closing Date. The "tax matters person" with
respect to each REMIC hereunder shall be the Trustee and the Trustee shall
hold the Tax Matters Person Certificate. Each REMIC's fiscal year shall be the
calendar year.
SECTION 2.08. Covenants of the Master Servicer.
The Master Servicer hereby covenants to the Depositor and the
Trustee as follows:
(a) the Master Servicer shall comply in the performance of its
obligations under this Agreement with all reasonable rules and requirements of
the insurer under each Required Insurance Policy; and
(b) no written information, certificate of an officer, statement
furnished in writing or written report delivered to the Depositor, any
affiliate of the Depositor or the Trustee and prepared by the Master Servicer
pursuant to this Agreement will contain any untrue statement of a material
fact or omit to state a material fact necessary to make such information,
certificate, statement or report not misleading.
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ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
SECTION 3.01. Master Servicer to Service Mortgage Loans.
For and on behalf of the Certificateholders, the Master Servicer
shall service and administer the Mortgage Loans in accordance with the terms
of this Agreement and customary and usual standards of practice of prudent
mortgage loan servicers. In connection with such servicing and administration,
the Master Servicer shall have full power and authority, acting alone and/or
through Subservicers as provided in Section 3.02 hereof, subject to the terms
hereof (i) to execute and deliver, on behalf of the Certificateholders and the
Trustee, customary consents or waivers and other instruments and documents,
(ii) to consent to transfers of any Mortgaged Property and assumptions of the
Mortgage Notes and related Mortgages (but only in the manner provided in this
Agreement), (iii) to collect any Insurance Proceeds and other Liquidation
Proceeds (which, for the purpose of this Section, includes any Subsequent
Recoveries), and (iv) to effectuate foreclosure or other conversion of the
ownership of the Mortgaged Property securing any Mortgage Loan; provided that
the Master Servicer shall not take any action that is inconsistent with or
prejudices the interests of the Trust Fund or the Certificateholders in any
Mortgage Loan or the rights and interests of the Depositor, the Trustee and
the Certificateholders under this Agreement. The Master Servicer shall
represent and protect the interests of the Trust Fund in the same manner as it
protects its own interests in mortgage loans in its own portfolio in any
claim, proceeding or litigation regarding a Mortgage Loan, and shall not make
or permit any modification, waiver or amendment of any Mortgage Loan which
would cause any REMIC created hereunder to fail to qualify as a REMIC or
result in the imposition of any tax under Section 860F(a) or Section 860G(d)
of the Code. Without limiting the generality of the foregoing, the Master
Servicer, in its own name or in the name of the Depositor and the Trustee, is
hereby authorized and empowered by the Depositor and the Trustee, when the
Master Servicer believes it appropriate in its reasonable judgment, to execute
and deliver, on behalf of the Trustee, the Depositor, the Certificateholders
or any of them, any and all instruments of satisfaction or cancellation, or of
partial or full release or discharge and all other comparable instruments,
with respect to the Mortgage Loans, and with respect to the Mortgaged
Properties held for the benefit of the Certificateholders. The Master Servicer
shall prepare and deliver to the Depositor and/or the Trustee such documents
requiring execution and delivery by either or both of them as are necessary or
appropriate to enable the Master Servicer to service and administer the
Mortgage Loans to the extent that the Master Servicer is not permitted to
execute and deliver such documents pursuant to the preceding sentence. Upon
receipt of such documents, the Depositor and/or the Trustee shall execute such
documents and deliver them to the Master Servicer. The Master Servicer further
is authorized and empowered by the Trustee, on behalf of the
Certificateholders and the Trustee, in its own name or in the name of the
Subservicer, when the Master Servicer or the Subservicer, as the case may be,
believes it appropriate in its best judgment to register any Mortgage Loan on
the MERS(R) System, or cause the removal from the registration of any Mortgage
Loan on the MERS(R) System, to execute and deliver, on behalf of the Trustee
and the Certificateholders or any of them, any and all instruments of
assignment and other comparable instruments with respect to such assignment or
re-recording of a Mortgage in the name of MERS, solely as nominee for the
Trustee and its successors and assigns.
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
III-1
calculating monthly distributions to the Certificateholders, be added to the
Stated Principal Balances of the related Mortgage Loans, notwithstanding that
the terms of such Mortgage Loans so permit.
SECTION 3.02. Subservicing; Enforcement of the Obligations of
Subservicers.
(a) The Master Servicer may arrange for the subservicing of any
Mortgage Loan by a Subservicer pursuant to a subservicing agreement; provided,
however, that such subservicing arrangement and the terms of the related
subservicing agreement must provide for the servicing of such Mortgage Loans
in a manner consistent with the servicing arrangements contemplated hereunder.
Unless the context otherwise requires, references in this Agreement to actions
taken or to be taken by the Master Servicer in servicing the Mortgage Loans
include actions taken or to be taken by a Subservicer on behalf of the Master
Servicer. Notwithstanding the provisions of any subservicing agreement, any of
the provisions of this Agreement relating to agreements or arrangements
between the Master Servicer and a Subservicer or reference to actions taken
through a Subservicer or otherwise, the Master Servicer shall remain obligated
and liable to the Depositor, the Trustee and the Certificateholders for the
servicing and administration of the Mortgage Loans in accordance with the
provisions of this Agreement without diminution of such obligation or
liability by virtue of such subservicing agreements or arrangements or by
virtue of indemnification from the Subservicer and to the same extent and
under the same terms and conditions as if the Master Servicer alone were
servicing and administering the Mortgage Loans. All actions of each
Subservicer performed pursuant to the related subservicing agreement shall be
performed as an agent of the Master Servicer with the same force and effect as
if performed directly by the Master Servicer.
(b) For purposes of this Agreement, the Master Servicer shall be
deemed to have received any collections, recoveries or payments with respect
to the Mortgage Loans that are received by a Subservicer regardless of whether
such payments are remitted by the Subservicer to the Master Servicer.
SECTION 3.03. Rights of the Depositor and the Trustee in Respect
of the Master Servicer.
The Depositor may, but is not obligated to, enforce the
obligations of the Master Servicer hereunder and may, but is not obligated to,
perform, or cause a designee to perform, any defaulted obligation of the
Master Servicer hereunder and in connection with any such defaulted obligation
to exercise the related rights of the Master Servicer hereunder; provided that
the Master Servicer shall not be relieved of any of its obligations hereunder
by virtue of such performance by the Depositor or its designee. Neither the
Trustee nor the Depositor shall have any responsibility or liability for any
action or failure to act by the Master Servicer nor shall the Trustee or the
Depositor be obligated to supervise the performance of the Master Servicer
hereunder or otherwise.
SECTION 3.04. Trustee to Act as Master Servicer.
In the event that the Master Servicer shall for any reason no
longer be the Master Servicer hereunder (including by reason of an Event of
Default or termination by the Depositor), the Trustee or its successor shall
thereupon assume all of the rights and obligations of the Master Servicer
hereunder arising thereafter (except that the Trustee shall not be (i) liable
for losses of the Master Servicer pursuant to Section 3.09 hereof or any acts
or omissions of the predecessor Master Servicer hereunder), (ii) obligated to
make Advances if it is prohibited from doing so by applicable law, (iii)
obligated to effectuate repurchases or substitutions of Mortgage Loans
hereunder including, but not limited to, repurchases or substitutions of
Mortgage Loans pursuant to Section 2.02 or 2.03 hereof, (iv) responsible for
expenses of the Master Servicer pursuant to Section 2.03 or (v) deemed to have
made any representations and warranties of the Master Servicer hereunder). Any
such assumption shall be subject to Section 7.02
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hereof. If the Master Servicer shall for any reason no longer be the Master
Servicer (including by reason of any Event of Default or termination by the
Depositor), the Trustee or its successor shall succeed to any rights and
obligations of the Master Servicer under each subservicing agreement.
The Master Servicer shall, upon request of the Trustee, but at the
expense of the Master Servicer, deliver to the assuming party all documents
and records relating to each subservicing agreement or substitute subservicing
agreement and the Mortgage Loans then being serviced thereunder and an
accounting of amounts collected or held by it and otherwise use its best
efforts to effect the orderly and efficient transfer of the substitute
subservicing agreement to the assuming party.
SECTION 3.05. Collection of Mortgage Loan Payments; the
Certificate Account; the Distribution Account; the
Supplemental Interest Trust and the Corridor
Contract 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 receipt (or, if the current long-term
credit rating of Countrywide is reduced below "A-" by S&P or Xxxxx, xx "X0" 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 herein, the following payments and collections remitted by
Subservicers or received by it in respect of Mortgage Loans subsequent to the
Cut-off Date (other than in respect of principal and interest due on the
Mortgage Loans on or before the Cut-off Date) and the following amounts
required to be deposited hereunder:
(i) all payments on account of principal on the Mortgage Loans,
including Principal Prepayments;
(ii) all payments on account of interest on the Mortgage Loans,
net of the Master Servicing Fee, Prepayment Interest Excess and any
lender-paid mortgage insurance premiums;
(iii) [Reserved]
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(iv) all Insurance Proceeds, Subsequent Recoveries and Liquidation
Proceeds, other than proceeds to be applied to the restoration or repair
of the Mortgaged Property or released to the Mortgagor in accordance
with the Master Servicer's normal servicing procedures;
(v) any amount required to be deposited by the Master Servicer or
the Depositor pursuant to Section 3.05(e) in connection with any losses
on Permitted Investments for which it is responsible;
(vi) any amounts required to be deposited by the Master Servicer
pursuant to Section 3.09(c) and in respect of net monthly rental income
from REO Property pursuant to Section 3.11 hereof;
(vii) all Substitution Adjustment Amounts;
(viii) all Advances made by the Master Servicer pursuant to
Section 4.01; and
(ix) any other amounts required to be deposited hereunder.
In addition, with respect to any Mortgage Loan that is subject to
a buydown agreement, on each Due Date for such Mortgage Loan, in addition to
the monthly payment remitted by the Mortgagor, the Master Servicer shall cause
funds to be deposited into the Certificate Account in an amount required to
cause an amount of interest to be paid with respect to such Mortgage Loan
equal to the amount of interest that has accrued on such Mortgage Loan from
the preceding Due Date at the Mortgage Rate net of the Master Servicing Fee.
The foregoing requirements for remittance by the Master Servicer
shall be exclusive, it being understood and agreed that, without limiting the
generality of the foregoing, payments in the nature of Prepayment Charges,
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 herein to the contrary notwithstanding.
Such withdrawal or direction may be accomplished by delivering written notice
thereof to the Trustee or such other institution maintaining the Certificate
Account which describes the amounts deposited in error in the Certificate
Account. The Master Servicer shall maintain adequate records with respect to
all withdrawals made pursuant to this Section. All funds deposited in the
Certificate Account shall be held in trust for the Certificateholders until
withdrawn in accordance with Section 3.08.
(c) [Reserved].
(d) The Trustee shall establish and maintain, on behalf of the
Certificateholders, the Distribution Account. The Trustee shall, promptly upon
receipt, deposit in the Distribution Account and retain therein the following:
(i) the aggregate amount remitted by the Master Servicer to the
Trustee pursuant to Section 3.08(a)(ix);
(ii) any amount deposited by the Master Servicer or the Depositor
pursuant to Section 3.05(e) in connection with any losses on Permitted
Investments for which it is responsible; and
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(iii) any other amounts deposited hereunder which are required to
be deposited in the Distribution Account.
In the event that the Master Servicer shall remit any amount not
required to be remitted, it may at any time direct the Trustee to withdraw
such amount from the Distribution Account, any provision herein to the
contrary notwithstanding. Such direction may be accomplished by delivering an
Officer's Certificate to the Trustee which describes the amounts deposited in
error in the Distribution Account. All funds deposited in the Distribution
Account shall be held by the Trustee in trust for the Certificateholders until
disbursed in accordance with this Agreement or withdrawn in accordance with
Section 3.08. In no event shall the Trustee incur liability for withdrawals
from the Distribution Account at the direction of the Master Servicer.
(e) Each institution at which the Certificate Account or the
Distribution Account is maintained shall invest the funds therein as directed
in writing by the Master Servicer in 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 herein. The amount of any realized losses in the Certificate Account
or the Distribution Account incurred in any such account in respect of any
such investments shall promptly be deposited by the Master Servicer in the
Certificate Account or paid to the Trustee for deposit into the Distribution
Account, as applicable. The Trustee in its fiduciary capacity shall not be
liable for the amount of any loss incurred in respect of any investment or
lack of investment of funds held in the Certificate Account or the
Distribution Account and made in accordance with this Section 3.05.
(f) The Master Servicer shall give notice to the Trustee, each
Seller, each Rating Agency and the Depositor of any proposed change of the
location of the Certificate Account prior to any change thereof. The Trustee
shall give notice to the Master Servicer, each Seller, each Rating Agency and
the Depositor of any proposed change of the location of the Distribution
Account prior to any change thereof. The Supplemental Interest 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 Corridor Contract
Reserve Fund prior to any change thereof.
(g) On the Closing Date, there is hereby established a separate
trust (the "Supplemental Interest Trust"), the assets of which shall consist
of the Corridor Contract Reserve Fund and the Supplemental Interest Trustee's
rights and obligations under the Corridor Contracts The Supplemental Interest
Trust shall be maintained by the Supplemental Interest Trustee, who initially,
shall be the Trustee.
On the Closing Date, the Supplemental Interest Trustee shall
establish and maintain in its name, in trust for the benefit of the Holders of
the Covered Certificates, the Corridor Contract 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 Corridor Contract Reserve Fund shall be
held separate and apart from, and
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shall not be commingled with, any other moneys, including without limitation,
other moneys held by the Trustee pursuant to this Agreement.
On each Distribution Date, the Supplemental Interest Trustee shall
deposit into the Corridor Contract Reserve Fund all amounts received in
respect of each Corridor Contract for the related Interest Accrual Period. The
Supplemental Interest Trustee shall make withdrawals from the Corridor
Contract Reserve Fund to make distributions pursuant to Section 4.09
exclusively (other than as expressly provided for in Section 3.08).
Notwithstanding anything to the contrary in this Agreement, the Supplemental
Interest Trustee shall be allowed to transfer funds in the Corridor Contract
Reserve Fund to the Trustee to facilitate, for administrative purposes,
distribution of such funds to Certificateholders through the Distribution
Account.
Funds in the Corridor Contract Reserve Fund shall remain uninvested.
SECTION 3.06. Collection of Taxes, Assessments and Similar Items; Escrow
Accounts.
(a) To the extent required by the related Mortgage Note and not
violative of current law, the Master Servicer shall establish and maintain one
or more accounts (each, an "Escrow Account") and deposit and retain therein
all collections from the Mortgagors (or advances by the Master Servicer) for
the payment of taxes, assessments, hazard insurance premiums or comparable
items for the account of the Mortgagors. Nothing herein shall require the
Master Servicer to compel a Mortgagor to establish an Escrow Account in
violation of applicable law.
(b) Withdrawals of amounts so collected from the Escrow Accounts
may be made only to effect timely payment of taxes, assessments, hazard
insurance premiums, condominium or PUD association dues, or comparable items,
to reimburse the Master Servicer out of related collections for any payments
made pursuant to Sections 3.01 hereof (with respect to taxes and assessments
and insurance premiums) and 3.09 hereof (with respect to hazard insurance), to
refund to any Mortgagors any sums determined to be overages, to pay interest,
if required by law or the terms of the related Mortgage or Mortgage Note, to
Mortgagors on balances in the Escrow Account or to clear and terminate the
Escrow Account at the termination of this Agreement in accordance with Section
9.01 hereof. The Escrow Accounts shall not be a part of the Trust Fund.
(c) The Master Servicer shall advance any payments referred to in
Section 3.06(a) that are not timely paid by the Mortgagors on the date when
the tax, premium or other cost for which such payment is intended is due, but
the Master Servicer shall be required so to advance only to the extent that
such advances, in the good faith judgment of the Master Servicer, will be
recoverable by the Master Servicer out of Insurance Proceeds, Liquidation
Proceeds or otherwise.
SECTION 3.07. Access to Certain Documentation and Information
Regarding the Mortgage Loans.
The Master Servicer shall afford each Seller, the Depositor and
the Trustee reasonable access to all records and documentation regarding the
Mortgage Loans and all accounts, insurance information and other matters
relating to this Agreement, such access being afforded without charge, but
only upon reasonable request and during normal business hours at the office
designated by the Master Servicer.
Upon reasonable advance notice in writing, the Master Servicer
will provide to each Certificateholder and/or Certificate Owner which is a
savings and loan association, bank or insurance company certain reports and
reasonable access to information and documentation regarding the Mortgage
III-6
Loans sufficient to permit such Certificateholder and/or Certificate Owner to
comply with applicable regulations of the OTS or other regulatory authorities
with respect to investment in the Certificates; provided that the Master
Servicer shall be entitled to be reimbursed by each such Certificateholder
and/or Certificate Owner for actual expenses incurred by the Master Servicer
in providing such reports and access.
SECTION 3.08. Permitted Withdrawals from the Certificate Account,
the Distribution Account and the Corridor Contract
Reserve Fund.
(a) The Master Servicer may from time to time make withdrawals
from the Certificate Account for the following purposes:
(i) to pay to the Master Servicer (to the extent not previously
retained by the Master Servicer) the servicing compensation to which it
is entitled pursuant to Section 3.14, and to pay to the Master Servicer,
as additional servicing compensation, earnings on or investment income
with respect to funds in or credited to the Certificate Account;
(ii) to reimburse each of the Master Servicer and the Trustee for
unreimbursed Advances made by it, such right of reimbursement pursuant
to this subclause (ii) being limited to amounts received on the Mortgage
Loan(s) in respect of which any such Advance was made;
(iii) to reimburse each of the Master Servicer and the Trustee for
any Nonrecoverable Advance previously made by it;
(iv) to reimburse the Master Servicer for Insured Expenses from
the related Insurance Proceeds;
(v) to reimburse the Master Servicer for (a) unreimbursed
Servicing Advances, the Master Servicer's right to reimbursement
pursuant to this clause (a) with respect to any Mortgage Loan being
limited to amounts received on such Mortgage Loan(s) which represent
late recoveries of the payments for which such advances were made
pursuant to Section 3.01 or Section 3.06 and (b) for unpaid Master
Servicing Fees as provided in Section 3.11 hereof;
(vi) to pay to the purchaser, with respect to each Mortgage Loan
or property acquired in respect thereof that has been purchased pursuant
to Section 2.02, 2.03 or 3.11, all amounts received thereon after the
date of such purchase;
(vii) to reimburse the Sellers, the Master Servicer or the
Depositor for expenses incurred by any of them and reimbursable pursuant
to Section 6.03 hereof;
(viii) to withdraw any amount deposited in the Certificate Account
and not required to be deposited therein;
(ix) on or prior to the Distribution Account Deposit Date, to
withdraw an amount equal to the sum of (a) the related Available Funds
and (b) 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 hereof.
III-7
The Master Servicer shall keep and maintain separate accounting,
on a Mortgage Loan by Mortgage Loan basis, for the purpose of justifying any
withdrawal from the Certificate Account pursuant to such subclauses (i), (ii),
(iv), (v) and (vi). Prior to making any withdrawal from the Certificate
Account pursuant to subclause (iii), the Master Servicer shall deliver to the
Trustee an Officer's Certificate of a Servicing Officer indicating the amount
of any previous Advance determined by the Master Servicer to be a
Nonrecoverable Advance and identifying the related Mortgage Loans(s), and
their respective portions of such Nonrecoverable Advance.
(b) The Trustee shall withdraw funds from the Distribution Account
for distributions to Certificateholders in the manner specified in this
Agreement (and to withhold from the amounts so withdrawn, the amount of any
taxes that it is authorized to withhold pursuant to the third paragraph of
Section 8.11). In addition, the Trustee may from time to time make withdrawals
from the Distribution Account for the following purposes:
(i) to pay to itself the Trustee Fee for the related Distribution
Date;
(ii) to pay to the Master Servicer as additional servicing
compensation earnings on or investment income with respect to funds in
the Distribution Account;
(iii) to withdraw and return to the Master Servicer any amount
deposited in the Distribution Account and not required to be deposited
therein;
(iv) to reimburse the Trustee for any unreimbursed Advances made
by it pursuant to Section 4.01(b) hereof, such right of reimbursement
pursuant to this subclause (iv) being limited to (x) amounts received on
the related Mortgage Loan(s) in respect of which any such Advance was
made and (y) amounts not otherwise reimbursed to the Trustee pursuant to
Section 3.08(a)(ii) hereof;
(v) to reimburse the Trustee for any Nonrecoverable Advance
previously made by the Trustee pursuant to Section 4.01(b) hereof, such
right of reimbursement pursuant to this subclause (v) being limited to
amounts not otherwise reimbursed to the Trustee pursuant to Section
3.08(a)(iii) hereof; and
(vi) to clear and terminate the Distribution Account upon
termination of the Agreement pursuant to Section 9.01 hereof.
(c) The Supplemental Interest Trustee shall withdraw funds from
the Corridor Contract Reserve Fund for distribution to the Covered
Certificates in the manner specified in Section 4.09 (and to withhold from the
amounts so withdrawn the amount of any taxes that it is authorized to retain
pursuant to the third paragraph of Section 8.11). In addition, the
Supplemental Interest Trustee may from time to time make withdrawals from the
Corridor Contract Reserve Fund for the following purposes:
(i) to withdraw any amount deposited in the Corridor Contract
Reserve Fund and not required to be deposited therein; and
(ii) to clear and terminate the Corridor Contract Reserve Fund
upon the earlier of (i) the reduction of the aggregate Class Certificate
Balance of the Covered Certificates to zero, and (ii) the latest
Corridor Contract Scheduled Termination Date, as applicable.
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SECTION 3.09. Maintenance of Hazard Insurance; Maintenance of
Primary Insurance Policies.
(a) The Master Servicer shall cause to be maintained, for each
Mortgage Loan, hazard insurance with extended coverage in an amount that is at
least equal to the lesser of (i) the maximum insurable value of the
improvements securing such Mortgage Loan or (ii) the greater of (y) the
outstanding principal balance of the Mortgage Loan and (z) an amount such that
the proceeds of such policy shall be sufficient to prevent the Mortgagor
and/or the mortgagee from becoming a co-insurer. Each such policy of standard
hazard insurance shall contain, or have an accompanying endorsement that
contains, a standard mortgagee clause. Any amounts collected by the Master
Servicer under any such policies (other than the amounts to be applied to the
restoration or repair of the related Mortgaged Property or amounts released to
the Mortgagor in accordance with the Master Servicer's normal servicing
procedures) shall be deposited in the Certificate Account. Any cost incurred
by the Master Servicer in maintaining any such insurance shall not, for the
purpose of calculating monthly distributions to the Certificateholders or
remittances to the Trustee for their benefit, be added to the principal
balance of the Mortgage Loan, notwithstanding that the terms of the Mortgage
Loan so permit. Such costs shall be recoverable by the Master Servicer out of
late payments by the related Mortgagor or out of the proceeds of liquidation
of the Mortgage Loan or Subsequent Recoveries to the extent permitted by
Section 3.08 hereof. It is understood and agreed that no earthquake or other
additional insurance is to be required of any Mortgagor or maintained on
property acquired in respect of a Mortgage other than pursuant to such
applicable laws and regulations as shall at any time be in force and as shall
require such additional insurance. If the Mortgaged Property is located at the
time of origination of the Mortgage Loan in a federally designated special
flood hazard area and such area is participating in the national flood
insurance program, the Master Servicer shall cause flood insurance to be
maintained with respect to such Mortgage Loan. Such flood insurance shall be
in an amount equal to the least of (i) the outstanding principal balance of
the related Mortgage Loan, (ii) the replacement value of the improvements
which are part of such Mortgaged Property, and (iii) the maximum amount of
such insurance available for the related Mortgaged Property under the national
flood insurance program.
(b) The Master Servicer shall not take any action which would
result in non-coverage under any applicable Primary Insurance Policy of any
loss which, but for the actions of the Master Servicer, would have been
covered thereunder. The Master Servicer shall not cancel or refuse to renew
any such Primary Insurance Policy that is in effect at the date of the initial
issuance of the Certificates and is required to be kept in force hereunder
unless the replacement Primary Insurance Policy for such canceled or
non-renewed policy is maintained with a Qualified Insurer.
Except with respect to any Lender PMI Mortgage Loans, the Master
Servicer shall not be required to maintain any Primary Insurance Policy (i)
with respect to any Mortgage Loan with a Loan-to-Value Ratio less than or
equal to 80% as of any date of determination or, based on a new appraisal, the
principal balance of such Mortgage Loan represents 80% or less of the new
appraised value or (ii) if maintaining such Primary Insurance Policy is
prohibited by applicable law. With respect to the Lender PMI Mortgage Loans,
the Master Servicer shall maintain the Primary Insurance Policy for the life
of such Mortgage Loans, unless otherwise provided for in the related Mortgage
Note or prohibited by law.
The Master Servicer agrees to effect the timely payment of the
premiums on each Primary Insurance Policy, and such costs not otherwise
recoverable shall be recoverable by the Master Servicer from the related
proceeds of liquidation 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
III-9
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) hereof, in any
case in which a Mortgaged Property has been conveyed to a Person by a
Mortgagor, and such Person is to enter into an assumption agreement or
modification agreement or supplement to the Mortgage Note or Mortgage that
requires the signature of the Trustee, or if an instrument of release signed
by the Trustee is required releasing the Mortgagor from liability on the
Mortgage Loan, the Master Servicer shall prepare and deliver or cause to be
prepared and delivered to the Trustee for signature and shall direct, in
writing, the Trustee to execute the assumption agreement with the Person to
whom the Mortgaged Property is to be conveyed and such modification agreement
or supplement to the Mortgage Note or Mortgage or other instruments as are
reasonable or necessary to carry out the terms of the Mortgage Note or
Mortgage or otherwise to comply with any applicable laws regarding assumptions
or the transfer of the Mortgaged Property to such Person. In connection with
any such assumption, no material term of the Mortgage Note may be changed. In
addition, the substitute Mortgagor and the Mortgaged Property must be
acceptable to the Master Servicer in accordance with its underwriting
standards as then in effect. Together with each such 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
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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 the proceeds of liquidation of
the Mortgage Loan and Subsequent Recoveries (respecting which it shall have
priority for purposes of withdrawals from the Certificate Account). The Master
Servicer shall be responsible for all other costs and expenses incurred by it
in any such proceedings; provided, however, that it shall be entitled to
reimbursement thereof from the proceeds of liquidation of the Mortgage Loan
and Subsequent Recoveries with respect to the related Mortgaged Property, as
provided in the definition of Liquidation Proceeds. If the Master Servicer has
knowledge that a Mortgaged Property which the Master Servicer is contemplating
acquiring in foreclosure or by deed in lieu of foreclosure is located within a
1 mile radius of any site listed in the Expenditure Plan for the Hazardous
Substance Clean Up Bond Act of 1984 or other site with environmental or
hazardous waste risks known to the Master Servicer, the Master Servicer will,
prior to acquiring the Mortgaged Property, consider such risks and only take
action in accordance with its established environmental review procedures.
With respect to any REO Property, the deed or certificate of sale
shall be taken in the name of the Trustee for the benefit of the
Certificateholders, or its nominee, on behalf of the Certificateholders. The
Trustee's name shall be placed on the title to such REO Property solely as the
Trustee hereunder and not in its individual capacity. The Master Servicer
shall ensure that the title to such REO Property references the Pooling and
Servicing Agreement and the Trustee's capacity thereunder. Pursuant to its
efforts to sell such REO Property, the Master Servicer shall either itself or
through an agent selected by the Master Servicer protect and conserve such REO
Property in the same manner and to such extent as is customary in the locality
where such REO Property is located and may, incident to its conservation and
protection of the interests of the Certificateholders, rent the same, or any
part thereof, as the Master Servicer deems to be in the best interest of the
Certificateholders for the period prior to the sale of such REO Property. The
Master Servicer shall prepare for and deliver to the Trustee a statement with
respect to each REO Property that has been rented showing the aggregate rental
income received and all expenses incurred in connection with the maintenance
of such REO Property at such times as is necessary to enable the Trustee to
comply with the reporting requirements of the REMIC Provisions. The net
monthly rental income, if any, from such REO Property shall be deposited in
the Certificate Account no later than the close of business on each
Determination Date. The Master Servicer shall perform the tax reporting and
withholding required by Sections 1445 and 6050J of the Code with respect to
foreclosures and abandonments, the tax reporting required by Section 6050H of
the Code with respect to the receipt of mortgage interest from individuals and
any tax reporting required by Section 6050P of the Code with respect to the
cancellation of indebtedness by certain financial entities, by
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preparing such tax and information returns as may be required, in the form
required, and delivering the same to the Trustee for filing.
In the event that the Trust Fund acquires any Mortgaged Property
as aforesaid or otherwise in connection with a default or imminent default on
a Mortgage Loan, the Master Servicer shall dispose of such Mortgaged Property
as soon as practicable in a manner that maximizes the Liquidation Proceeds
thereof, but in no event later than three years after its acquisition by the
Trust Fund. In that event, the Trustee shall have been supplied with an
Opinion of Counsel to the effect that the holding by the Trust Fund of such
Mortgaged Property subsequent to a three-year period, if applicable, will not
result in the imposition of taxes on "prohibited transactions" of any REMIC
hereunder as defined in section 860F of the Code or cause any REMIC hereunder
to fail to qualify as a REMIC at any time that any Certificates are
outstanding, the Trust Fund may continue to hold such Mortgaged Property
(subject to any conditions contained in such Opinion of Counsel) after the
expiration of such three-year period. Notwithstanding any other provision of
this Agreement, no Mortgaged Property acquired by the Trust Fund shall be
rented (or allowed to continue to be rented) or otherwise used for the
production of income by or on behalf of the Trust Fund in such a manner or
pursuant to any terms that would (i) cause such Mortgaged Property to fail to
qualify as "foreclosure property" within the meaning of section 860G(a)(8) of
the Code or (ii) subject any REMIC hereunder to the imposition of any federal,
state or local income taxes on the income earned from such Mortgaged Property
under Section 860G(c) of the Code or otherwise, unless the Master Servicer has
agreed to indemnify and hold harmless the Trust Fund with respect to the
imposition of any such taxes.
In the event of a default on a Mortgage Loan one or more of whose
obligor is not a United States Person, as that term is defined in Section
7701(a)(30) of the Code, in connection with any foreclosure or acquisition of
a deed in lieu of foreclosure (together, "foreclosure") in respect of such
Mortgage Loan, the Master Servicer will cause compliance with the provisions
of Treasury Regulation Section 1.1445-2(d)(3) (or any successor thereto)
necessary to assure that no withholding tax obligation arises with respect to
the proceeds of such foreclosure except to the extent, if any, that proceeds
of such foreclosure are required to be remitted to the obligors on such
Mortgage Loan.
The decision of the Master Servicer to foreclose on a defaulted
Mortgage Loan shall be subject to a determination by the Master Servicer that
the proceeds of such foreclosure would exceed the costs and expenses of
bringing such a proceeding. The income earned from the management of any REO
Properties, net of reimbursement to the Master Servicer for expenses incurred
(including any property or other taxes) in connection with such management and
net of unreimbursed Master Servicing Fees, Advances and Servicing Advances,
shall be applied to the payment of principal of and interest on the related
defaulted Mortgage Loans (with interest accruing as though such Mortgage Loans
were still current) and all such income shall be deemed, for all purposes in
this Agreement, to be payments on account of principal and interest on the
related Mortgage Notes and shall be deposited into the Certificate Account. To
the extent the net income received during any calendar month is in excess of
the amount attributable to amortizing principal and accrued interest at the
related Mortgage Rate on the related Mortgage Loan for such calendar month,
such excess shall be considered to be a partial prepayment of principal of the
related Mortgage Loan.
The proceeds from any liquidation of a Mortgage Loan, as well as
any income from an REO Property, will be applied in the following order of
priority: first, to reimburse the Master Servicer for any related unreimbursed
Servicing Advances and Master Servicing Fees; second, to reimburse the Master
Servicer or the Trustee for any unreimbursed Advances; third, to reimburse the
Certificate Account for any Nonrecoverable Advances (or portions thereof) that
were previously withdrawn by the Master Servicer or the Trustee pursuant to
Section 3.08(a)(iii) that related to such Mortgage Loan; fourth, to accrued
and unpaid interest (to the extent no Advance has been made for such amount or
any such
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Advance has been reimbursed) on the Mortgage Loan or related REO Property, at
the Adjusted Net Mortgage Rate to the Due Date occurring in the month in which
such amounts are required to be distributed; and fifth, as a recovery of
principal of the Mortgage Loan. Excess Proceeds, if any, from the liquidation
of a Liquidated Mortgage Loan will be retained by the Master Servicer as
additional servicing compensation pursuant to Section 3.14.
The Master Servicer, in its sole discretion, shall have the right
to purchase for its own account from the Trust Fund any Mortgage Loan which is
151 days or more delinquent at a price equal to the Purchase Price; provided,
however, that the Master Servicer may only exercise this right on or before
the next to the last day of the calendar month in which such Mortgage Loan
became 151 days delinquent (such month, the "Eligible Repurchase Month");
provided further, that any such Mortgage Loan which becomes current but
thereafter becomes delinquent may be purchased by the Master Servicer pursuant
to this Section in any ensuing Eligible Repurchase Month. The Purchase Price
for any Mortgage Loan purchased hereunder 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 hereto, shall release or cause to be
released to the purchaser of such Mortgage Loan the related Mortgage File and
shall execute and deliver such instruments of transfer or assignment prepared
by the purchaser of such Mortgage Loan, in each case without recourse, as
shall be necessary to vest in the purchaser of such Mortgage Loan any Mortgage
Loan released pursuant hereto and the purchaser of such Mortgage Loan shall
succeed to all the Trustee's right, title and interest in and to such Mortgage
Loan and all security and documents related thereto. Such assignment shall be
an assignment outright and not for security. The purchaser of such Mortgage
Loan shall thereupon own such Mortgage Loan, and all security and documents,
free of any further obligation to the Trustee or the Certificateholders with
respect thereto.
(b) Countrywide may agree to a modification of any Mortgage Loan
(the "Modified Mortgage Loan") if (i) the modification is in lieu of a
refinancing and (ii) the Mortgage Rate on the Modified Mortgage Loan is
approximately a prevailing market rate for newly-originated mortgage loans
having similar terms and (iii) Countrywide 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 Countrywide 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 Countrywide. 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.
Countrywide shall remit the Purchase Price for any Modified
Mortgage Loan to the Master Servicer for deposit into 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
Countrywide 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 Countrywide any Modified Mortgage Loan previously
transferred and assigned pursuant hereto. Countrywide 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 Countrywide (but such obligation shall not prevent
Countrywide or any other appropriate Person from in good faith contesting any
such tax in appropriate proceedings and shall not prevent Countrywide from
withholding payment of such tax, if permitted by law, pending the outcome of
such proceedings). Countrywide shall have no right of
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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 Countrywide.
SECTION 3.12. Trustee to Cooperate; Release of Mortgage Files.
Upon the payment in full of any Mortgage Loan, or the receipt by
the Master Servicer of a notification that payment in full will be escrowed in
a manner customary for such purposes, the Master Servicer will immediately
notify the Trustee by delivering, or causing to be delivered a "Request for
Release" substantially in the form of Exhibit N. 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 thereon. The Master Servicer is authorized to cause the removal
from the registration on the MERS 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
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and shall be and remain the sole and exclusive property of the Trustee,
subject to the applicable provisions of this Agreement. The Master Servicer
also agrees that it shall not create, incur or subject any Mortgage File or
any funds that are deposited in the Certificate Account, Distribution Account
or any Escrow Account, or any funds that otherwise are or may become due or
payable to the Trustee for the benefit of the Certificateholders, to any
claim, lien, security interest, judgment, levy, writ of attachment or other
encumbrance, or assert by legal action or otherwise any claim or right of
setoff against any Mortgage File or any funds collected on, or in connection
with, a Mortgage Loan, except, however, that the Master Servicer shall be
entitled to set off against and deduct from any such funds any amounts that
are properly due and payable to the Master Servicer under this Agreement.
SECTION 3.14. Servicing Compensation.
As compensation for its activities hereunder, the Master Servicer
shall be entitled to retain or withdraw from the Certificate Account an amount
equal to the Master Servicing Fee; provided, that the aggregate Master
Servicing Fee for a Loan Group with respect to any Distribution Date shall be
reduced (i) by an amount equal to the aggregate of the Prepayment Interest
Shortfalls on all of the Mortgage Loans, if any, with respect to such
Distribution Date, but not to exceed the Compensating Interest for such Loan
Group and 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 Interest Excess, Prepayment Charges, assumption fees, late payment
charges and all income and gain net of any losses realized from Permitted
Investments on funds in the Certificate Account and Distribution Account shall
be retained by the Master Servicer to the extent not required to be deposited
in the Certificate Account pursuant to Section 3.05 hereof. 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 Holders and/or Certificate
Owners and the examiners and supervisory agents of the OTS, the FDIC and such
other authorities, access to the documentation regarding the Mortgage Loans
required by applicable regulations of the OTS and the FDIC. Such access shall
be afforded without charge, but only upon reasonable and prior written request
and during normal business hours at the offices designated by the Master
Servicer. Nothing in this Section shall limit the obligation of the Master
Servicer to observe any applicable law prohibiting disclosure of information
regarding the Mortgagors and the failure of the Master Servicer to provide
access as provided in this Section as a result of such obligation shall not
constitute a breach of this Section.
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 to Equifax, Experian and Trans Union
Credit Information Company (three of the nationally recognized credit bureaus)
on a monthly basis.
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SECTION 3.16. Annual Statement as to Compliance.
(a) The Master Servicer shall deliver to the Depositor and the
Trustee on or before March 15 of each year, commencing with its 2008 fiscal
year, an Officer's Certificate stating, as to the signer thereof, that (i) a
review of the activities of the Master Servicer during the preceding calendar
year (or applicable portion thereof) and of the performance of the Master
Servicer under this Agreement has been made under such officer's supervision
and (ii) to the best of such officer's knowledge, based on such review, the
Master Servicer has fulfilled all its obligations under this Agreement in all
material respects throughout such year (or applicable portion thereof), or, if
there has been a failure to fulfill any such obligation in any material
respect, specifying each such failure known to such officer and the nature and
status thereof.
(b) The Master Servicer shall cause each Subservicer to deliver to
the Depositor and the Trustee on or before March 15 of each year, commencing
with its 2008 fiscal year, an Officer's Certificate stating, as to the signer
thereof, that (i) a review of the activities of such Subservicer during the
preceding calendar year (or applicable portion thereof) and of the performance
of the Subservicer under the applicable Subservicing Agreement or primary
servicing agreement, has been made under such officer's supervision and (ii)
to the best of such officer's knowledge, based on such review, such
Subservicer has fulfilled all its obligations under the applicable
Subservicing Agreement or primary servicing agreement, in all material
respects throughout such year (or applicable portion thereof), or, if there
has been a failure to fulfill any such obligation in any material respect,
specifying each such failure known to such officer and the nature and status
thereof.
(c) The Trustee shall forward a copy of each such statement to
each Rating Agency.
SECTION 3.17. Errors and Omissions Insurance; Fidelity Bonds.
The Master Servicer shall for so long as it acts as master
servicer under this Agreement, obtain and maintain in force (a) a policy or
policies of insurance covering errors and omissions in the performance of its
obligations as Master Servicer hereunder and (b) a fidelity bond in respect of
its officers, employees and agents. Each such policy or policies and bond
shall, together, comply with the requirements from time to time of FNMA or
FHLMC for persons performing servicing for mortgage loans purchased by FNMA or
FHLMC. In the event that any such policy or bond ceases to be in effect, the
Master Servicer shall obtain a comparable replacement policy or bond from an
insurer or issuer, meeting the requirements set forth above as of the date of
such replacement.
SECTION 3.18. The Corridor Contracts.
The Corridor Contracts will not be assets of the Trust Fund or of any
REMIC. The Supplemental Interest Trustee shall cause to be deposited into the
Corridor Contract Reserve Fund any amounts received from time to time with
respect to each Corridor Contract.
The Trustee shall prepare and deliver any notices required to be
delivered under each Corridor Contract.
The Master Servicer, on behalf of the Supplemental Interest Trustee,
shall act as calculation agent and/or shall terminate each Corridor Contract
upon the occurrence of certain events of default or termination events to the
extent specified in such Corridor Contract. Upon any such termination, the
Corridor Contract Counterparty will be obligated to pay the Supplemental
Interest Trustee, for the benefit of the Supplemental Interest Trust, an
amount in respect of such termination. Any amounts received by the
Supplemental Interest Trustee in respect of the termination of a Corridor
Contract shall be deposited
III-16
and held in the Corridor Contract Reserve Fund and applied on future
Distribution Dates to pay the Yield Supplement Amount on the related Class of
Covered Certificates.
Any amounts remaining in the Corridor Contract Reserve Fund on the
Distribution Date immediately following the earlier of (i) the reduction of
the aggregate Class Certificate Balance of the Covered Certificates to zero,
and (ii) the latest Corridor Contract Scheduled Termination Date will be
distributed to the Underwriter (Senior).
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ARTICLE IV
DISTRIBUTIONS AND
ADVANCES BY THE MASTER SERVICER
SECTION 4.01. Advances.
(a) The Master Servicer shall determine on or before each Master
Servicer Advance Date whether it is required to make an Advance pursuant to
the definition thereof. If the Master Servicer determines it is required to
make an Advance, it shall, on or before the Master Servicer Advance Date,
either (i) deposit into the Certificate Account an amount equal to the Advance
or (ii) make an appropriate entry in its records relating to the Certificate
Account that any Amount Held for Future Distribution for the applicable Loan
Group has been used by the Master Servicer in discharge of its obligation to
make any such Advance. Any funds so applied shall be replaced by the Master
Servicer by deposit in the Certificate Account no later than the close of
business on the next Master Servicer Advance Date. The Master Servicer shall
be entitled to be reimbursed from the Certificate Account for all Advances of
its own funds made pursuant to this Section as provided in Section 3.08. The
obligation to make Advances with respect to any Mortgage Loan shall continue
if such Mortgage Loan has been foreclosed or otherwise terminated and the
related Mortgaged Property has not been liquidated.
(b) If the Master Servicer determines that it will be unable to
comply with its obligation to make the Advances as and when described in the
second sentence of Section 4.01(a), it shall use its best efforts to give
written notice thereof to the Trustee (each such notice a "Trustee Advance
Notice"; and such notice may be given by telecopy), not later than 3:00 P.M.,
New York time, on the Business Day immediately preceding the related Master
Servicer Advance Date, specifying the amount that it will be unable to deposit
(each such amount an "Advance Deficiency") and certifying that such Advance
Deficiency constitutes an Advance hereunder and is not a Nonrecoverable
Advance. If the Trustee receives a Trustee Advance Notice on or before 3:30
P.M., New York time on a Master Servicer Advance Date, the Trustee shall, not
later than 3:00 P.M., New York time, on the related Distribution Date, deposit
in the Distribution Account an amount equal to the Advance Deficiency
identified in such Trustee Advance Notice unless it is prohibited from so
doing by applicable law. Notwithstanding the foregoing, the Trustee shall not
be required to make such deposit if the Trustee shall have received written
notification from the Master Servicer that the Master Servicer has deposited
or caused to be deposited in the Certificate Account an amount equal to such
Advance Deficiency. All Advances made by the Trustee pursuant to this Section
4.01(b) shall accrue interest on behalf of the Trustee at the Trustee Advance
Rate from and including the date such Advances are made to but excluding the
date of repayment, with such interest being an obligation of the Master
Servicer and not the Trust Fund. The Master Servicer shall reimburse the
Trustee for the amount of any Advance made by the Trustee pursuant to this
Section 4.01(b) together with accrued interest, not later than the fifth day
following the related Master Servicer Advance Date. In the event that the
Master Servicer does not reimburse the Trustee in accordance with the
requirements of the preceding sentence, the Trustee shall have the right, but
not the obligation, to immediately (a) terminate all of the rights and
obligations of the Master Servicer under this Agreement in accordance with
Section 7.01 and (b) subject to the limitations set forth in Section 3.04,
assume all of the rights and obligations of the Master Servicer hereunder.
(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
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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 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, in each case,
to the extent of Available Funds remaining:
(i) [reserved];
(ii) concurrently, to each interest-bearing Class of Group 1
Senior Certificates, an amount allocable to interest equal to the
related Class Optimal Interest Distribution Amount, any shortfall being
allocated among such Classes in proportion to the amount of the Class
Optimal Interest Distribution Amount with respect to the Group 1
Certificates that would have been distributed in the absence of such
shortfall, provided that prior to an Accrual Termination Date, the
related Accrual Amount shall be distributed as provided in Section
4.02(a)(1)(iii);
(iii) the Accrual Amount for each Class of Accrual Certificates in
the Group 1 Senior Certificates shall be distributed as principal to the
applicable Classes of Accretion Directed Certificates in accordance with
the Accretion Direction Rule for such Class of Accrual Certificates;
(iv) to each Class of Group 1 Senior Certificates, concurrently,
as follows:
(x) to the Class PO-1 Component, the related PO Formula
Principal Amount, until the Component Balance thereof is reduced
to zero; and
(y) the related Non-PO Formula Principal Amount, up to the
amount of the Senior Principal Distribution Amount for Loan Group
1 for such Distribution Date, in the following order:
1. concurrently, to the Class 1-A-4, Class 1-A-9 and
Class 1-A-13 Certificates, pro rata, the Group 1 Priority
Amount, until their respective Class Certificate Balances
are reduced to zero;
2. concurrently:
a. 31.7643721998%, in the following order:
i. sequentially, to the Class 1-A-1 and
Class 1-A-2 Certificates, in that order, in
an amount up to the amount necessary to
reduce their aggregate Class Certificate
Balance to their Aggregate Planned Balance
for that Distribution Date, until their
respective Class Certificate Balances are
reduced to zero;
ii. concurrently, to the Class 1-A-6,
Class 1-A-21 and Class 1-A-23 Certificates,
pro rata, in an amount up to the amount
necessary to reduce their aggregate Class
Certificate
IV-2
Balance to their Aggregate Targeted Balance
for that Distribution Date;
iii. to the Class 1-A-7 Certificates,
until its Class Certificate Balance is
reduced to zero;
iv. concurrently, to the Class 1-A-6,
Class 1-A-21 and Class 1-A-23 Certificates,
pro rata, without regard to their Aggregate
Targeted Balance for that Distribution Date,
until their respective Class Certificate
Balances are reduced to zero;
v. to the Class 1-A-8 Certificates, until
its Class Certificate Balance is reduced to
zero;
vi. sequentially, to the Class 1-A-1 and
Class 1-A-2 Certificates, in that order,
without regard to their Aggregate Planned
Balance for that Distribution Date, until
their respective Class Certificate Balances
are reduced to zero; and
vii. to the Class 1-A-3 Certificates,
until its Class Certificate Balance is
reduced to zero; and
b. 68.2356278002%, in the following order:
i. sequentially, to the Class 1-A-10 and
Class 1-A-11 Certificates, in that order, in
an amount up to the amount necessary to
reduce their aggregate Class Certificate
Balance to their Aggregate Planned Balance
for that Distribution Date, until their
respective Class Certificate Balances are
reduced to zero;
ii. concurrently, to the Class 1-A-15,
Class 1-A-19 and Class 1-A-24 Certificates,
pro rata, in an amount up to the amount
necessary to reduce their aggregate Class
Certificate Balance to their Aggregate
Targeted Balance for that Distribution Date;
iii. to the Class 1-A-16 Certificates,
until its Class Certificate Balance is
reduced to zero;
iv. concurrently, to the Class 1-A-15,
Class 1-A-19 and Class 1-A-24 Certificates,
pro rata, without regard to their Aggregate
Targeted Balance for that Distribution Date,
until their respective Class Certificate
Balances are reduced to zero;
v. to the Class 1-A-17 Certificates,
until its Class Certificate Balance is
reduced to zero;
vi. sequentially, to the Class 1-A-10 and
Class 1-A-11 Certificates, in that order,
without regard to their Aggregate
IV-3
Planned Balance for that Distribution Date,
until their respective Class Certificate
Balances are reduced to zero; and
vii. to the Class 1-A-12 Certificates,
until its Class Certificate Balance is
reduced to zero; and
3. concurrently, to the Class 1-A-4, Class 1-A-9 and
Class 1-A-13 Certificates, pro rata, without regard to
the Group 1 Priority Amount, until their respective Class
Certificate Balances are reduced to zero; and
(v) to the Class PO-1 Component, any related Class PO Deferred
Amount, up to an amount not to exceed the amount calculated pursuant to
clause (A) of the definition of the Subordinated Principal Distribution
Amount for Loan Group 1 actually received or advanced for such
Distribution Date (with such amount to be allocated first from amounts
calculated pursuant to (A)(i), then (ii), and then (iii) of the
definition of Subordinated Principal Distribution Amount).
(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 Available Funds remaining:
(i) [Reserved];
(ii) concurrently, to each interest-bearing Class of Group 2
Senior Certificates, an amount allocable to interest equal to the
related Class Optimal Interest Distribution Amount, any shortfall being
allocated among such Classes in proportion to the amount of the Class
Optimal Interest Distribution Amount with respect to the Group 2
Certificates that would have been distributed in the absence of such
shortfall, provided that prior to an Accrual Termination Date, the
related Accrual Amount shall be distributed as provided in Section
4.02(a)(2)(iii);
(iii) the Accrual Amount for each Class of Accrual Certificates in
the Group 2 Senior Certificates shall be distributed as principal to the
applicable Classes of Accretion Directed Certificates in accordance with
the Accretion Direction Rule for such Class of Accrual Certificates;
(iv) to each Class of Group 2 Senior Certificates, concurrently,
as follows:
(x) to the Class PO-2 Component, the related PO Formula
Principal Amount, until the Component Balance thereof is reduced
to zero; and
(y) the related Non-PO Formula Principal Amount, up to the
amount of the Senior Principal Distribution Amount for Loan Group
2 for such Distribution Date, in the following order:
1. to the Class A-R Certificates, until its Class
Certificate Balance is reduced to zero;
2. to the Class 2-A-3 Certificates, the Group 2
Priority Amount, until its Class Certificate Balance is
reduced to zero;
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3. to the Class 2-A-1 Certificates, in an amount up to
the amount necessary to reduce its Class Certificate
Balance to its Planned Balance for that Distribution
Date;
4. to the Class 2-A-5 Certificates, in an amount up to
the amount necessary to reduce its Class Certificate
Balance to its Targeted Balance for that Distribution
Date;
5. to the Class 2-A-6 Certificates, until its Class
Certificate Balance is reduced to zero;
6. to the Class 2-A-5 Certificates, without regard to
its Targeted Balance for that Distribution Date, until
its Class Certificate Balance is reduced to zero;
7. to the Class 2-A-7 Certificates, until its Class
Certificate Balance is reduced to zero;
8. to the Class 2-A-1, without regard to its Planned
Balance for that Distribution Date, until its Class
Certificate Balance is reduced to zero;
9. to the Class 2-A-2 Certificates, until its Class
Certificate Balance is reduced to zero; and
10. to the Class 2-A-3 Certificates, without regard to
the Group 2 Priority Amount, until its Class Certificate
Balance is reduced to zero; and
(v) to the Class PO-2 Component, any related Class PO Deferred
Amount, up to an amount not to exceed the amount calculated pursuant to
clause (A) of the definition of the Subordinated Principal Distribution
Amount for Loan Group 2 actually received or advanced for such
Distribution Date (with such amount to be allocated first from amounts
calculated pursuant to (A)(i) and (ii) then (iii) of the definition of
Subordinated Principal Distribution Amount).
(3) On each Distribution Date, after making the distributions
described in Section 4.02(a)(1) and Section 4.02(a)(2) above, the remaining
Available Funds from each Loan Group will be distributed to the Senior
Certificates to the extent provided in Section 4.05 hereof.
(4) On each Distribution Date, Available Funds from both Loan Groups
remaining after making the distributions described in Section 4.02(a)(1),
Section 4.02(a)(2) and Section 4.02(a)(3) above will be distributed to the
Subordinated Certificates and the Class A-R Certificates in the following
order, in each case, to the extent of such funds remaining:
(A) to the Class 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 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 B-1 Certificates, an amount allocable to
interest equal to the Class Optimal Interest Distribution Amount
for such Class for such Distribution Date;
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(D) to the Class 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 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 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 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 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 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 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 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 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 in
the Trust Fund.
If any Class of Depositable Certificates has been surrendered to
the Trustee for Exchangeable Certificates, the Trustee, as Holder of such
surrendered Depositable Certificates, shall deposit any amounts distributable
to such Class of Depositable Certificates in this Section 4.02(a) in the
Exchangeable Certificates Distribution Account and shall distribute such
amounts to the Holders of the related Class or Classes of Exchangeable
Certificates pursuant to Section 5.07.
On any Distribution Date, amounts distributed in respect of Class PO
Deferred Amounts will not reduce the Component Balance of the related Class PO
Component.
On any Distribution Date, to the extent the Amount Available for Senior
Principal for a Loan Group is insufficient to make the full distribution
required to be made pursuant to the applicable subclauses (iv)(x) above, (A)
the amount distributable on the applicable Class PO Component in respect of
principal pursuant to such subclause (iv)(x), shall be equal to the product of
(1) the Amount Available for Senior Principal for such Loan Group and (2) a
fraction, the numerator of which is the related PO Formula Principal Amount
and the denominator of which is the sum of such PO Formula Principal Amount
and the applicable Senior Principal Distribution Amount and (B) the amount
distributable on the related Senior Certificates, other than the applicable
Class PO Component, in respect of principal
IV-6
pursuant to such clause (iv)(y) shall be equal to the product of (1) such
Amount Available for Senior Principal and (2) a fraction, the numerator of
which is the applicable Senior Principal Distribution Amount and the
denominator of which is the sum of such Senior Principal Distribution Amount
and the related PO Formula Principal Amount.
(b) On each Distribution Date prior to and including the
applicable Accrual Termination Date with respect to each Class or Component of
Accrual Certificates, the Accrual Amount for such Class or Component for such
Distribution Date shall not (except as provided in the second to last sentence
in this paragraph) be distributed as interest with respect to such Class or
Component of Accrual Certificates, but shall instead be added to the related
Class Certificate Balance of such Class on the related Distribution Date. With
respect to any Distribution Date prior to and including the applicable Accrual
Termination Date on which principal payments on any Class or Component of
Accrual Certificates are distributed pursuant to Section 4.02(a)(1)(iv)(y) or
Section 4.02(a)(2)(iv)(y), as applicable, the related Accrual Amount shall be
deemed to have been added on such Distribution Date to the related Class
Certificate Balance of such Class or Component of Accrual Certificates (and
included in the amount distributable on the related Class or Classes or
Component of Accretion Directed Certificates pursuant to Section
4.02(a)(1)(iii) or Section 4.02(a)(2)(iii), as applicable, for such
Distribution Date) and the related distribution thereon shall be deemed to
have been applied concurrently towards the reduction of all or a portion of
the amount so added and, to the extent of any excess, towards the reduction of
the Class Certificate Balance or Component Balance of such Class or Component
of Accrual Certificates immediately prior to such Distribution Date.
Notwithstanding any such distribution, the Accrual Certificates shall continue
to be a Class of Accrual Certificates on each subsequent Distribution Date
until the applicable Accrual Termination Date.
(c) On each Distribution Date on or after the Senior Credit
Support Depletion Date, notwithstanding the allocation and priorities set
forth in Sections 4.02(a)(1)(iv)(y) and 4.02(a)(2)(iv)(y) the portion of
Available Funds for Loan Group 1 and Loan Group 2 available to be distributed
as principal of the related Classes of Senior Certificates (other than the
related Class PO Component) shall be distributed concurrently, as principal,
on the related Classes, pro rata, on the basis of their respective Class
Certificate Balances, until the Class Certificate Balances thereof are reduced
to zero.
(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 for such Distribution Date shall be reduced for each
Class of Senior Certificates of a Senior Certificate Group and each Class of
Subordinated Certificates by (i) the related Class' pro rata share of Net
Prepayment Interest Shortfalls for such Loan Group based (x) with respect to a
Class of Senior Certificates, on the related Class Optimal Interest
Distribution Amount and (y) with respect to the Class of Subordinated
Certificates on or prior to a Senior Termination Date on the Assumed Interest
Amount and after such Senior Termination Date, the related Class' Class
Optimal Interest Distribution Amount for such Distribution Date, without
taking into account such Net Prepayment Interest Shortfalls, and (ii) the
related Class' Allocable Share of the interest portion of the related Debt
Service Reduction and each Relief Act Reduction for the Mortgage Loans in the
related Loan Group (or, after the Senior Credit Support Depletion Date, any
Mortgage Loan) incurred during the calendar month preceding the month of such
Distribution Date.
(e) Notwithstanding the priority and allocation contained in
Section 4.02(a)(4), if, on any Distribution Date, with respect to any Class of
Subordinated Certificates (other than the 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
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 Principal Prepayments will be made to any such Classes (the "Restricted
Classes") and the amount of such
IV-7
Principal Prepayments otherwise distributable to the Restricted Classes shall
be distributed to any Classes of 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)(4).
(f) If the amount of a Realized Loss on a Mortgage Loan in a Loan
Group has been reduced by application of Subsequent Recoveries with respect to
such Mortgage Loan, the amount of such Subsequent Recoveries will be applied
sequentially, in the order of payment priority, to increase the Class
Certificate Balance of each related Class of Certificates 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 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 of each Certificate of such Class.
SECTION 4.03. [Reserved].
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. For purposes of allocating losses to the Subordinated
Certificates, the Class M Certificates will be deemed to have a lower
numerical Class designation, and to be of a higher relative payment priority,
than each other Class of Subordinated Certificates.
Realized Losses with respect to any Distribution Date shall be
allocated as follows:
(i) the applicable PO Percentage of any Realized Loss on a
Mortgage Loan in a Loan Group shall be allocated to the related Class PO
Component, until the Component Balance thereof is reduced to zero; and
(ii) the applicable Non-PO Percentage of any Realized Loss shall
be allocated first to the Subordinated Certificates in reverse order of
their respective numerical Class designations (beginning with the Class
of Subordinated Certificates then outstanding with the highest numerical
Class designation) until the respective Class Certificate Balance of
each such Class is reduced to zero, second, to the Classes of Senior
Certificates (other than any Notional Amount Certificates and the Class
PO Certificates), pro rata on the basis of their respective Class
Certificate Balances or, in the case of any Class of Accrual
Certificates or Accrual Component, on the basis of the lesser of their
respective Class Certificate Balances or Component Balance, as
applicable immediately prior to such Distribution Date, and their
respective initial Class Certificate Balances or Component Balance, as
applicable, until the respective Class Certificate Balance or Component
Balance of each such Class or Component is reduced to zero, except that
(i) the first $2,283,000 of Realized Losses that would otherwise be
allocated to the Class 1-A-2 Certificates will instead be allocated to
the Class 1-A-9 Certificates, (ii) the first $11,597,000 of Realized
Losses that would otherwise be allocated to the Class 1-A-4 Certificates
will instead be allocated to the Class 1-A-9 Certificates, (iii) the
first $1,639,000 of Realized Losses that would otherwise be allocated to
the Class 1-A-6 Certificates will instead be allocated to the Class
1-A-9 Certificates, (iv) the first $1,798,000 of Realized Losses that
would otherwise be allocated to the Class 1-A-13 Certificates will
instead be allocated to the Class 1-A-9 Certificates and (v) the first
$5,098,000 of Realized Losses that would otherwise be allocated to the
Class 1-A-21 Certificates
IV-8
will instead be allocated to the Class 1-A-9 Certificates, in each case
until the Class Certificate Balance of the Class 1-A-9 Certificates is
reduced to zero.
(b) The Class Certificate Balance of the Class of Subordinated
Certificates then outstanding with the highest numerical Class designation
shall be reduced on each Distribution Date by the sum of (i) the amount of any
payments on the Class PO Certificates in respect of Class PO Deferred Amounts
and (ii) the amount, if any, by which the aggregate of the Class Certificate
Balances of all outstanding Classes of Certificates (after giving effect to
the distribution of principal and the allocation of Realized Losses and Class
PO Deferred Amounts on such Distribution Date) exceeds the Pool Stated
Principal Balance for the following Distribution Date.
(c) Any Realized Losses allocated to a Class of Certificates or
any reduction in the Class Certificate Balance of a Class of Certificates
pursuant to Section 4.04(a) 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 or Component Balance of
a Certificate or Component, pursuant to Section 4.04(a) above shall be
accomplished by reducing the Certificate Balance or Component Balance thereof,
as applicable, immediately following the distributions made on the related
Distribution Date in accordance with the definition of "Certificate Balance"
or "Component Balance," as the case may be. All Realized Losses allocated to a
Class of Component Certificates will be allocated, pro rata, to the related
Components.
SECTION 4.05. Cross-Collateralization; Adjustments to Available
Funds.
(a) [Reserved].
(b) If on any Distribution Date the Class Certificate Balance of
the Senior Certificates in a Certificate Group (other than the related Class
PO Component) is greater than the aggregate of the Non-PO Percentages of the
Stated Principal Balance of the Mortgage Loans in the related Loan Group (the
"Undercollateralized Group"), then the Trustee shall reduce the Available
Funds of the other Loan Group (the "Overcollateralized Group"), as follows:
(1) to add to the Available Funds of the Undercollateralized Group an
amount equal to the Available Funds of the Overcollateralized Group
remaining after making distributions to the Senior Certificates of the
Overcollateralized Group on such Distribution Date pursuant to Section
4.02; and
(2) to the Senior Certificates, other than the related Class PO
Component, of the Undercollateralized Group, to the extent of the
principal portion of Available Funds of the Overcollateralized Group
remaining after making distributions to the Senior Certificates of the
Overcollateralized Group on such Distribution Date pursuant to Section
4.02, until the Class Certificate Balance of the Senior Certificates,
other than the related Class PO Component, of such Undercollateralized
Group equals the aggregate of the Non-PO Percentages of the Stated
Principal Balance of the Mortgage Loans in the related Loan Group.
SECTION 4.06. Monthly Statements to Certificateholders.
(a) Concurrently with each distribution on a Distribution Date,
the Trustee will forward by electronic delivery to each Rating Agency and make
available to Certificateholders on the
IV-9
Trustee's website (xxxx://xxx.xxxxxxxxxxxxxxxxxxxx.xxx) a statement generally
setting forth the information contained in Exhibit U hereto. Such statement
shall also indicate whether any exchanges of Exchangeable Certificates or
Depositable Certificates have occurred since the immediately preceding
Distribution Date and, if applicable, the Class designation, Class Certificate
Balance or Notional Amount and Pass-Through Rate of any Classes of
Certificates that were received by a Certificateholder as a result of such
exchange as well as any Net Prepayment Interest Shortfalls and Realized Losses
allocated to such Certificates as a result of such exchange.
(b) The Trustee's responsibility for disbursing the above
information to the Certificateholders is limited to the availability,
timeliness and accuracy of the information provided by the Master Servicer.
(c) On or before the fifth Business Day following the end of each
Prepayment Period (but in no event later than the third Business Day prior to
the related Distribution Date), the Master Servicer shall deliver to the
Trustee (which delivery may be by electronic data transmission) a report in
substantially the form set forth as Schedule VI hereto.
(d) Within a reasonable period of time after the end of each
calendar year, the Trustee shall cause to be furnished to each Person who at
any time during the calendar year was a Certificateholder, a statement
containing the information set forth in items (1), (2) and (7) of Exhibit U
hereto, 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. Determination of Pass-Through Rates for COFI
Certificates.
The Pass-Through Rate for each Class of COFI Certificates for each
Interest Accrual Period after the initial Interest Accrual Period shall be
determined by the Trustee as provided below on the basis of the Index and the
applicable formulae appearing in footnotes corresponding to the COFI
Certificates in the table relating to the Certificates in the Preliminary
Statement.
Except as provided below, with respect to each Interest Accrual
Period following the initial Interest Accrual Period, the Trustee shall not
later than two Business Days prior to such Interest Accrual Period but
following the publication of the applicable Index determine the Pass-Through
Rate at which interest shall accrue in respect of the COFI Certificates during
the related Interest Accrual Period.
Except as provided below, the Index to be used in determining the
respective Pass-Through Rates for the COFI Certificates for a particular
Interest Accrual Period shall be COFI for the second calendar month preceding
the Outside Reference Date for such Interest Accrual Period. If at the Outside
Reference Date for any Interest Accrual Period, COFI for the second calendar
month preceding such Outside Reference Date has not been published, the
Trustee shall use COFI for the third calendar month preceding such Outside
Reference Date. If COFI for neither the second nor third calendar months
preceding any Outside Reference Date has been published on or before the
related Outside Reference Date, the Index for such Interest Accrual Period and
for all subsequent Interest Accrual Periods shall be the National Cost of
Funds Index for the third calendar month preceding such Interest Accrual
Period (or the fourth preceding calendar month if such National Cost of Funds
Index for the third preceding calendar month has not been published by such
Outside Reference Date). In the event that the National Cost of Funds Index
for neither the third nor fourth calendar months preceding an Interest Accrual
Period has been published on or before the related Outside Reference Date,
then for such Interest Accrual Period and
IV-10
for each succeeding Interest Accrual Period, the Index shall be LIBOR,
determined in the manner set forth below.
With respect to any Interest Accrual Period for which the
applicable Index is LIBOR, LIBOR for such Interest Accrual Period will be
established by the Trustee on the related Interest Determination Date as
provided in Section 4.08.
In determining LIBOR and any Pass-Through Rate for the COFI
Certificates or any Reserve Interest Rate, the Trustee may conclusively rely
and shall be protected in relying upon the offered quotations (whether
written, oral or on the Reuters Screen) from the Reference Banks or the New
York City banks as to LIBOR or the Reserve Interest Rate, as appropriate, in
effect from time to time. The Trustee shall not have any liability or
responsibility to any Person for (i) the Trustee's selection of New York City
banks for purposes of determining any Reserve Interest Rate or (ii) its
inability, following a good-faith reasonable effort, to obtain such quotations
from the Reference Banks or the New York City banks or to determine such
arithmetic mean, all as provided for in this Section 4.07.
The establishment of LIBOR and each Pass-Through Rate for the COFI
Certificates by the Trustee shall (in the absence of manifest error) be final,
conclusive and binding upon each Holder of a Certificate and the Trustee.
SECTION 4.08. Determination of Pass-Through Rates for LIBOR
Certificates.
(a) On each Interest Determination Date so long as any LIBOR
Certificates are Outstanding or any Exchangeable Certificates with a Floating
Pass-Through Rate have a Class Certificate Balance greater than zero, the
Trustee will determine LIBOR on the basis of the British Bankers' Association
("BBA") "Interest Settlement Rate" for one-month deposits in U.S. dollars as
quoted on the Bloomberg Terminal as of each LIBOR Determination Date.
(b) If on any Interest Determination Date, LIBOR cannot be
determined as provided in paragraph (A) of this Section 4.08, the Trustee
shall either (i) request each Reference Bank to inform the Trustee of the
quotation offered by its principal London office for making one-month United
States dollar deposits in leading banks in the London interbank market, as of
11:00 a.m. (London time) on such Interest Determination Date or (ii) in lieu
of making any such request, rely on such Reference Bank quotations that appear
at such time on the Reuters Screen LIBO Page (as defined in the International
Swap Dealers Association Inc. Code of Standard Wording, Assumptions and
Provisions for Swaps, 1986 Edition), to the extent available. LIBOR for the
next Interest Accrual Period will be established by the Trustee on each
interest Determination Date as follows:
(i) If on any Interest Determination Date two or more Reference
Banks provide such offered quotations, LIBOR for the next applicable
Interest Accrual Period shall be the arithmetic mean of such offered
quotations (rounding such arithmetic mean upwards if necessary to the
nearest whole multiple of 1/32%).
(ii) If on any Interest Determination Date only one or none of the
Reference Banks provides such offered quotations, LIBOR for the next
Interest Accrual Period shall be whichever is the higher of (i) LIBOR as
determined on the previous Interest Determination Date or (ii) the
Reserve Interest Rate. The "Reserve Interest Rate" shall be the rate per
annum which the Trustee determines to be either (i) the arithmetic mean
(rounded upwards if necessary to the nearest whole multiple of 1/32%) of
the one-month United States dollar lending rates that New York City
banks selected by the Trustee are quoting, on the relevant Interest
Determination Date, to the principal London offices of at least two of
the Reference Banks to which such quotations are, in
IV-11
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. If on the initial LIBOR Determination Date,
the Trustee is required but unable to determine LIBOR in the manner
provided above, LIBOR for the next Interest Accrual Period will be the
Initial LIBOR Rate.
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 Class Certificate Balance of a
Class of LIBOR Certificates is greater than zero, on the basis of LIBOR and
the respective formulae appearing in footnotes corresponding to the LIBOR
Certificates in the table relating to the Certificates in the Preliminary
Statement.
In determining LIBOR, any Pass-Through Rate for the LIBOR
Certificates, any Interest Settlement Rate, or any Reserve Interest Rate, the
Trustee may conclusively rely and shall be protected in relying upon the
offered quotations (whether written, oral or on the Dow Xxxxx Markets) from
the BBA designated banks, the Reference Banks or the New York City banks as to
LIBOR, the Interest Settlement Rate or the Reserve Interest Rate, as
appropriate, in effect from time to time. The Trustee shall not have any
liability or responsibility to any Person for (i) the Trustee's selection of
New York City banks for purposes of determining any Reserve Interest Rate or
(ii) its inability, following a good-faith reasonable effort, to obtain such
quotations from, the BBA designated banks, the Reference Banks or the New York
City banks or to determine such arithmetic mean, all as provided for in this
Section 4.08.
The establishment of LIBOR and each Pass-Through Rate for the
LIBOR Certificates by the Trustee shall (in the absence of manifest error) be
final, conclusive and binding upon each Holder of a Certificate and the
Trustee.
SECTION 4.09. Distributions from the Corridor Contract Reserve
Fund.
(a) On each Distribution Date on or prior to the earlier of (i)
the latest Corridor Contract Scheduled Termination Date and (ii) the date on
which the aggregate Class Certificate Balance of the Covered Certificates is
reduced to zero, amounts on deposit in the Corridor Contract Reserve Fund in
respect of a Corridor Contract will be withdrawn therefrom and distributed to
the related Class of Covered Certificates, to the extent needed to pay any
Yield Supplement Amount on that Class of Covered
IV-12
Certificates for such Distribution Date. Any amounts not required to pay such
Yield Supplement Amount will remain on deposit in the Corridor Contract
Reserve Fund until withdrawn.
(b) Any amounts remaining in the Corridor Contract Reserve Fund
after the earlier of (i) the date on which the aggregate Class Certificate
Balance of the Covered Certificates has been reduced to zero and (ii) the
latest Corridor Contract Scheduled Termination Date will be distributed to the
Underwriter (Senior).
IV-13
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 hereof 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 thereof.
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 hereof, 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 herein provided. Upon surrender for registration
of transfer of any Certificate, the Trustee shall execute and deliver, in the
name of the designated transferee or transferees, one or more new Certificates
of the same Class and aggregate Percentage Interest.
At the option of a Certificateholder, Certificates may be
exchanged for other Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest upon surrender of the
Certificates to be exchanged at the office or agency of the Trustee. Whenever
any
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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) For so long as the related Corridor Contract is in effect, 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-2 (the "Transferor Certificate") and (i) deliver a letter
in substantially the form of either Exhibit K (the "Investment Letter") or
Exhibit L-1 (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-1, or in the event such Certificate is a Residual Certificate,
such requirement is satisfied only by the Trustee's receipt of a
representation letter from the transferee substantially in the form of Exhibit
I), to the effect that (x) such transferee is not a Plan 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 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
(ii) in the case of any ERISA-Restricted Certificate presented for
registration in the name of a Plan, an Opinion of Counsel satisfactory to the
Trustee, which Opinion of
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Counsel shall not be an expense of either 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. 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 Opinion of Counsel 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 Certificate. Notwithstanding anything else to the contrary
herein, any purported transfer of an ERISA-Restricted Certificate to or on
behalf of a Plan without the delivery to the Trustee of an Opinion of Counsel
satisfactory to the Trustee as described above shall be void and of no effect.
No transfer of a Covered Certificate (other than a transfer of a
Covered Certificate to an affiliate of the Depositor (either directly or
through a nominee) in connection with the initial issuance of the
Certificates) shall be made unless the Trustee shall have received a
representation letter from the transferee of such Covered Certificate
substantially in the form of Exhibit L-2 to the effect that (i) such
transferee is not a Plan, or (ii) that the purchase and holding of the Covered
Certificate satisfies the requirements for exemptive relief under XXXX 00-00,
XXXX 00-0, XXXX 00-00, XXXX 00-00, XXXX 96-23, the service provider exemption
provided under Section 408(b)(17) of ERISA and Section 4975(d)(20) of the Code
or a similar exemption. In the event that such a representation letter is not
delivered, one of the foregoing representations, as appropriate, shall be
deemed to have been made by the transferee's (including an initial acquiror's)
acceptance of the Covered Certificate. In the event that such representation
is violated, such transfer or acquisition 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 or transfer of any ERISA-Restricted Certificate or Covered
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.
(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) in
connection with the initial issuance of the Certificates, no Ownership
Interest in a Residual Certificate may be registered on the Closing Date
or thereafter transferred, and the Trustee shall not register the
Transfer of any Residual Certificate unless the Trustee shall have been
furnished with an affidavit (a "Transfer Affidavit") of the initial
owner or the proposed transferee in the form attached hereto as Exhibit
I.
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(iii) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall agree (A) to obtain a Transfer Affidavit from
any other Person to whom such Person attempts to Transfer its Ownership
Interest in a Residual Certificate, (B) to obtain a Transfer Affidavit
from any Person for whom such Person is acting as nominee, trustee or
agent in connection with any Transfer of a Residual Certificate and (C)
not to Transfer its Ownership Interest in a Residual Certificate or to
cause the Transfer of an Ownership Interest in a Residual Certificate to
any other Person if it has actual knowledge that such Person is not a
Permitted Transferee and to provide to the Trustee a certificate
substantially in the form attached hereto as Exhibit J-1 stating that it
has no knowledge that such Person is not a Permitted Transferee.
(iv) Any attempted or purported Transfer of any Ownership Interest
in a Residual Certificate in violation of the provisions of this Section
5.02(c) shall be absolutely null and void and shall vest no rights in
the purported Transferee. If any purported transferee shall become a
Holder of a Residual Certificate in violation of the provisions of this
Section 5.02(c), then the last preceding Permitted Transferee shall be
restored to all rights as Holder thereof retroactive to the date of
registration of Transfer of such Residual Certificate. The Trustee shall
be under no liability to any Person for any registration of Transfer of
a Residual Certificate that is in fact not permitted by Section 5.02(b)
and this Section 5.02(c) or for making any payments due on such
Certificate to the Holder thereof or taking any other action with
respect to such Holder under the provisions of this Agreement so long as
the Transfer was registered after receipt of the related Transfer
Affidavit, Transferor Certificate and either the Rule 144A Letter or the
Investment Letter, if required. The Trustee shall be entitled but not
obligated to recover from any Holder of a Residual Certificate that was
in fact not a Permitted Transferee at the time it became a Holder or, at
such subsequent time as it became other than a Permitted Transferee, all
payments made on such Residual Certificate at and after either such
time. Any such payments so recovered by the Trustee shall be paid and
delivered by the Trustee to the last preceding Permitted Transferee of
such Certificate.
(v) The Depositor shall use its best efforts to make available,
upon receipt of written request from the Trustee, all information
necessary to compute any tax imposed under Section 860E(e) of the Code
as a result of a Transfer of an Ownership Interest in a Residual
Certificate to any Holder who is not a Permitted Transferee.
The restrictions on Transfers of a Residual Certificate set forth
in this Section 5.02(c) shall cease to apply (and the applicable portions of
the legend on a Residual Certificate may be deleted) with respect to Transfers
occurring after delivery to the Trustee of an Opinion of Counsel, which
Opinion of Counsel shall not be an expense of the Trust Fund, the Trustee, the
Master Servicer or any Seller, to the effect that the elimination of such
restrictions will not cause any REMIC hereunder to fail to qualify as a REMIC
at any time that the Certificates are outstanding or result in the imposition
of any tax on the Trust Fund, a Certificateholder or another Person. Each
Person holding or acquiring any Ownership Interest in a Residual Certificate
hereby consents to any amendment of this Agreement which, based on an Opinion
of Counsel furnished to the Trustee, is reasonably necessary (a) to ensure
that the record ownership of, or any beneficial interest in, a Residual
Certificate is not transferred, directly or indirectly, to a Person that is
not a Permitted Transferee and (b) to provide for a means to compel the
Transfer of a Residual Certificate which is held by a Person that is not a
Permitted Transferee to a Holder that is a Permitted Transferee.
(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
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may not be transferred by the Trustee except to another Depository; (ii) the
Depository shall maintain book-entry records with respect to the Certificate
Owners and with respect to ownership and transfers of such Book-Entry
Certificates; (iii) ownership and transfers of registration of the Book-Entry
Certificates on the books of the Depository shall be governed by applicable
rules established by the Depository; (iv) the Depository may collect its usual
and customary fees, charges and expenses from its Depository Participants; (v)
the Trustee shall deal with the Depository, Depository Participants and
indirect participating firms as representatives of the Certificate Owners of
the Book-Entry Certificates for purposes of exercising the rights of holders
under this Agreement, and requests and directions for and votes of such
representatives shall not be deemed to be inconsistent if they are made with
respect to different Certificate Owners; and (vi) the Trustee may rely and
shall be fully protected in relying upon information furnished by the
Depository with respect to its Depository Participants and furnished by the
Depository Participants with respect to indirect participating firms and
persons shown on the books of such indirect participating firms as direct or
indirect Certificate Owners.
All transfers by Certificate Owners of Book-Entry Certificates
shall be made in accordance with the procedures established by the Depository
Participant or brokerage firm representing such Certificate Owner. Each
Depository Participant shall only transfer Book-Entry Certificates of
Certificate Owners it represents or of brokerage firms for which it acts as
agent in accordance with the Depository's normal procedures.
If (x) (i) the Depository or the Depositor advises the Trustee in
writing that the Depository is no longer willing or able to properly discharge
its responsibilities as Depository, and (ii) the Trustee or the Depositor is
unable to locate a qualified successor, or (y) after the occurrence of an
Event of Default, Certificate Owners representing at least 51% of the
Certificate Balance of the Book-Entry Certificates together advise the Trustee
and the Depository through the Depository Participants in writing that the
continuation of a book-entry system through the Depository is no longer in the
best interests of the Certificate Owners, the Trustee shall notify all
Certificate Owners, through the Depository, of the occurrence of any such
event and of the availability of definitive, fully-registered Certificates
(the "Definitive Certificates") to Certificate Owners requesting the same.
Upon surrender to the Trustee of the related Class of Certificates by the
Depository, accompanied by the instructions from the Depository for
registration, the Trustee shall issue the Definitive Certificates. Neither the
Master Servicer, the Depositor nor the Trustee shall be liable for any delay
in delivery of such instruction and each may conclusively rely on, and shall
be protected in relying on, such instructions. The Master Servicer shall
provide the Trustee with an adequate inventory of certificates to facilitate
the issuance and transfer of Definitive Certificates. Upon the issuance of
Definitive Certificates all references herein 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
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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
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.
SECTION 5.07. Depositable and Exchangeable Certificates.
(a) On the Closing Date, there is hereby established a separate
trust (the "ES Trust"), which shall be a Grantor Trust for federal income tax
purposes. The ES Trust shall be maintained by the Trustee in its name, for the
benefit of the Holders of the Certificates. The assets of the ES Trust shall
consist of the LTR-A-R Interest and the uncertificated Master REMIC Interests
which have been placed in the ES Trust through the efforts of the Underwriter
(Senior). The LTR-A-R Interest and the uncertificated Master REMIC Interests
in the ES Trust shall be held by the Trustee. On the Closing Date, the ES
Trust shall issue the several Classes of Certificates. Each Class of
Exchangeable Certificates shall be issued on the Closing Date with a Class
Certificate Balance of zero. Upon the sale of the Certificates on the Closing
Date, the Exchangeable Certificates shall be placed with the Trustee through
the efforts of the Underwriter (Senior) to be held to facilitate the exchange
of Depositable and Exchangeable
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Certificates on and after the Closing Date. Among the Depositable and
Exchangeable Certificates, the beneficial interest of the uncertificated
Master REMIC Interests shall be represented by the related Depositable
Certificates until such Depositable Certificates have been exchanged for
Exchangeable Certificates, at which time, such Exchangeable Certificates shall
represent those uncertificated Master REMIC Interests.
The Trustee, as trustee of the ES Trust, shall establish and
maintain, on behalf of the Holders of the Exchangeable Certificates, the
Exchangeable Certificates Distribution Account. All funds on deposit in the
Exchangeable Certificates Distribution Account shall be held separate and
apart from, and shall not be commingled with, any other moneys, including
without limitation, other moneys held by the Trustee pursuant to this
Agreement.
On each Distribution Date, the Trustee, as holder of any
surrendered Depositable Certificates, shall deposit in the Exchangeable
Certificates Distribution Account any amounts distributable to the surrendered
Depositable Certificates pursuant to Section 4.02. For the avoidance of doubt,
if on any Distribution Date no Classes of Depositable Certificates have been
surrendered or if all Classes of Exchangeable Certificates have been exchanged
for Depositable Certificates according to Section 5.07(e), then no amounts
will be deposited in the Exchangeable Certificates Deposit Account on such
Distribution Date.
On each Distribution Date, the Trustee shall make withdrawals from
the Exchangeable Certificates Distribution Account to make distributions to
the Classes of Exchangeable Certificates then entitled to distributions
pursuant to Section 5.07(b).
Funds in the Exchangeable Certificates Distribution Account shall
remain uninvested.
(b) On each Distribution Date, the Trustee shall withdraw funds on
deposit in the Exchangeable Certificates Distribution Account and distribute
such amount to the Holders of each related Class of Exchangeable Certificates.
Amounts related to interest distributed to the surrendered Depositable
Certificates shall be distributed as interest to the related Class or Classes
of Exchangeable Certificates. All distributions of principal to the
Exchangeable Certificates shall be made pro rata among the Classes of
Exchangeable Certificates within each Recombination Group unless specifically
provided for otherwise in Schedule VII. All distributions that are made with
respect to a particular Class of Exchangeable Certificates shall be made pro
rata among all Certificates of such Class in proportion to their respective
Class Certificate Balances.
In addition, the Trustee may from time to time make withdrawals
from the Exchangeable Certificates Distribution Account for the following
purposes:
(i) to withdraw any amount deposited in the Exchangeable
Certificates Distribution Account and not required to be deposited
therein; and
(ii) to clear and terminate the Exchangeable Certificates
Distribution Account upon the termination of this Agreement.
(c) On each Distribution Date on which a Class of Exchangeable
Certificates shall be entitled to receive distributions pursuant to Section
5.07(b), such Class shall be allocated a proportionate share of the Net
Prepayment Interest Shortfalls and Relief Act Shortfalls allocable to the
Classes of Depositable Certificates in the related Recombination Group.
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(d) On each Distribution Date on which a Class of Exchangeable
Certificates shall be entitled to receive distributions pursuant to Section
5.07(b), such Class shall be allocated a proportionate share of the Realized
Losses allocable to the Classes of Depositable Certificates in the related
Recombination Group.
(e) Upon the presentation and surrender of the Depositable
Certificates, the Holder thereof transfers, assigns, sets over and otherwise
conveys to the Trustee of the ES Trust, all of such Holder's right, title and
interest in and to such Depositable Certificates, including all payments of
interest thereon received after the month of the exchange. The Trustee on
behalf of the ES Trust shall furnish written acknowledgement to the Holder of
such surrendered Certificate of the transfer and assignment to it of such
Depositable Certificates.
At the request of the Holder of a Class or Classes of Depositable
Certificates, and upon the surrender of such Depositable Certificates, the
Trustee shall deliver such Exchangeable Certificates as set forth in such
Recombination Group in the respective Denominations determined based on the
proportion that the initial Class Certificate Balance or initial Notional
Amounts of such Exchangeable Certificates bear to the initial Class
Certificate Balances of the Depositable Certificates, as set forth in Schedule
VII, which shall represent in the aggregate, the entire beneficial ownership
of the Master REMIC Interests related to such surrendered Certificates. In
addition, at the request of the Holder of a Class or Classes of Exchangeable
Certificates, and upon the surrender of such Exchangeable Certificates, the
Trustee shall exchange such Exchangeable Certificates for another Class or
Classes of Exchangeable Certificates or the related surrendered Depositable
Certificates, as set forth in Schedule VII. There shall be no limitation on
the number of exchanges authorized pursuant to this Section 5.07.
Holders may exchange their Certificates according to this Section
5.07(e) by (i) providing notice to the Trustee no later than three (3)
Business Days prior to the date on which the Holder wishes to make such
exchange (the "Exchange Date"), which Exchange Date is subject to the
Trustee's approval and shall not be the first or last Business Day of the
month, (ii) remitting the Exchange Fee, as determined in the next paragraph,
to the Trustee and (iii) remitting the beneficial interest in the Depositable
Certificates or the Exchangeable Certificates, as applicable, to the Trustee.
Any such notice to the Trustee (A) may be provided to the Trustee by email at
xxxxxxx@xxxxxxxx.xxx or by telephone at (000) 000-0000, (B) must include (i)
the Certificateholder's letterhead, (ii) a medallion stamp guarantee or be
signed by an authorized signatory and be presented with an incumbency
certificate and (iii) set forth the following information: (a) the CUSIP
number of both the Certificates to be exchanged and the Certificates to be
received, (b) the outstanding Class Certificate Balance and the initial Class
Certificate Balance of the Certificates to be exchanged, (c) the
Certificateholder's DTC participant number and (d) the proposed Exchange Date,
and (C) is irrevocable beginning on the second Business Day prior to the
Exchange Date. Such exchange will be completed by the Trustee upon the receipt
by the Trustee of the Exchange Fee and the beneficial interest in the
Depositable Certificates or the Exchangeable Certificates, as applicable.
The preparation of all Certificates referred to in this Section
5.07(e) in connection with an exchange shall be at the expense of the parties
to such exchanges. For each exchange, the Certificateholder must pay the
Trustee a fee (the "Exchange Fee") equal to 1/32 of 1% of the current Class
Certificate Balance of the Certificates to be Exchanged but in no event shall
the fee be less than $2,000 or greater than $25,000.
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ARTICLE VI
THE DEPOSITOR AND THE MASTER SERVICER
SECTION 6.01. Respective Liabilities of the Depositor and the
Master Servicer.
The Depositor and the Master Servicer shall each be liable in
accordance herewith only to the extent of the obligations specifically and
respectively imposed upon and undertaken by them herein.
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 herein to
the contrary notwithstanding; provided, however, that the successor or
surviving Person to the Master Servicer shall be qualified to service mortgage
loans on behalf of FNMA or FHLMC.
As a condition to the effectiveness of any merger or
consolidation, at least 15 calendar days prior to the effective date of any
merger or consolidation of the Master Servicer, the Master Servicer shall
provide (x) written notice to the Depositor of any successor pursuant to this
Section and (y) in writing and in form and substance reasonably satisfactory
to the Depositor, all information reasonably requested by the Depositor in
order to comply with its reporting obligation under Item 6.02 of Form 8-K with
respect to a replacement Master Servicer.
SECTION 6.03. Limitation on Liability of the Depositor, the
Sellers, the Master Servicer 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 herein 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
VI-1
any document of any kind prima facie properly executed and submitted by any
Person respecting any matters arising hereunder. The Depositor, the Master
Servicer, each Seller and 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 resignation of the Master Servicer shall become effective
until the Trustee or a successor master servicer shall have assumed the Master
Servicer's responsibilities, duties, liabilities (other than those liabilities
arising prior to the appointment of such successor) and obligations hereunder
and the Depositor shall have received the information described in the
following sentence. As a condition to the effectiveness of any such
resignation, at least 15 calendar days prior to the effective date of such
resignation, the Master Servicer shall provide (x) written notice to the
Depositor of any successor pursuant to this Section and (y) in writing and in
form and substance reasonably satisfactory to the Depositor, all information
reasonably requested by the Depositor in order to comply with its reporting
obligation under Item 6.02 of Form 8-K with respect to the resignation of the
Master Servicer.
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ARTICLE VII
DEFAULT
SECTION 7.01. Events of Default.
"Event of Default," wherever used herein, 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 (except with
respect to a failure related to a Limited Exchange Act Reporting
Obligation), which failure materially affects the rights of
Certificateholders, that failure continues unremedied for a period of 60
days after the date on which written notice of such failure shall have
been given to the Master Servicer by the Trustee 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.
If an Event of Default described in clauses (i) to (vi) of this
Section shall occur, then, and in each and every such case, so long as such
Event of Default shall not have been remedied, the Trustee may, or, if an
Event of Default described in clauses (i) to (v) of this Section shall occur,
then, and in each and every such case, so long as such Event of Default shall
not have been remedied, at the direction of the
VII-1
Holders of Certificates evidencing not less than 66-2/3% of the Voting Rights
evidenced by the Certificates, the Trustee shall, by notice in writing to the
Master Servicer (with a copy to each Rating Agency and the Depositor),
terminate all of the rights and obligations of the Master Servicer under this
Agreement and in and to the Mortgage Loans and the proceeds thereof, other
than its rights as a Certificateholder hereunder.
In addition, if during the period that the Depositor is required
to file Exchange Act Reports with respect to the Trust Fund, the Master
Servicer shall fail to observe or perform any of the obligations that
constitute a Limited Exchange Act Reporting Obligation or the obligations set
forth in Section 3.16(a) or Section 11.07(a)(1) and (2), and such failure
continues for the lesser of 10 calendar days or such period in which the
applicable Exchange Act Report can be filed timely (without taking into
account any extensions), so long as such failure shall not have been remedied,
the Trustee shall, but only at the direction of the Depositor, terminate all
of the rights and obligations of the Master Servicer under this Agreement and
in and to the Mortgage Loans and the proceeds thereof, other than its rights
as a Certificateholder hereunder. The Depositor shall not be entitled to
terminate the rights and obligations of the Master Servicer if a failure of
the Master Servicer to identify a Subcontractor "participating in the
servicing function" within the meaning of Item 1122 of Regulation AB was
attributable solely to the role or functions of such Subcontractor with
respect to mortgage loans other than the Mortgage Loans.
On and after the receipt by the Master Servicer of such written
notice, all authority and power of the Master Servicer hereunder, whether with
respect to the Mortgage Loans or otherwise, shall pass to and be vested in the
Trustee. The Trustee shall thereupon make any Advance which the Master
Servicer failed to make subject to Section 4.01 hereof whether or not the
obligations of the Master Servicer have been terminated pursuant to this
Section. The Trustee is hereby authorized and empowered to execute and
deliver, on behalf of the Master Servicer, as attorney-in-fact or otherwise,
any and all documents and other instruments, and to do or accomplish all other
acts or things necessary or appropriate to effect the purposes of such notice
of termination, whether to complete the transfer and endorsement or assignment
of the Mortgage Loans and related documents, or otherwise. Unless expressly
provided in such written notice, no such termination shall affect any
obligation of the Master Servicer to pay amounts owed pursuant to Article
VIII. The Master Servicer agrees to cooperate with the Trustee in effecting
the termination of the Master Servicer's responsibilities and rights
hereunder, including, without limitation, the transfer to the Trustee of all
cash amounts which shall at the time be credited to the Certificate Account,
or thereafter be received with respect to the Mortgage Loans.
Notwithstanding any termination of the activities of the Master
Servicer hereunder, the Master Servicer shall be entitled to receive, out of
any late collection of a Scheduled Payment on a Mortgage Loan which was due
prior to the notice terminating such Master Servicer's rights and obligations
as Master Servicer hereunder and received after such notice, that portion
thereof to which such Master Servicer would have been entitled pursuant to
Sections 3.08(a)(i) through (viii), and any other amounts payable to such
Master Servicer hereunder the entitlement to which arose prior to the
termination of its activities hereunder.
If the Master Servicer is terminated, the Trustee shall provide
the Depositor in writing and in form and substance reasonably satisfactory to
the Depositor, all information reasonably requested by the Depositor in order
to comply with its reporting obligation under Item 6.02 of Form 8-K with
respect to a successor master servicer in the event the Trustee should succeed
to the duties of the Master Servicer as set forth herein.
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SECTION 7.02. Trustee to Act; Appointment of Successor.
On and after the time the Master Servicer receives a notice of
termination pursuant to Section 7.01 hereof, the Trustee shall, subject to and
to the extent provided in Section 3.04, be the successor to the Master
Servicer in its capacity as master servicer under this Agreement and the
transactions set forth or provided for herein and shall be subject to all the
responsibilities, duties and liabilities relating thereto placed on the Master
Servicer by the terms and provisions hereof and applicable law including the
obligation to make Advances pursuant to Section 4.01. As compensation
therefor, the Trustee shall be entitled to all funds relating to the Mortgage
Loans that the Master Servicer would have been entitled to charge to the
Certificate Account or Distribution Account if the Master Servicer had
continued to act hereunder. Notwithstanding the foregoing, if the Trustee has
become the successor to the Master Servicer in accordance with Section 7.01
hereof, 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
hereof 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 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 hereunder. Any
successor to the Master Servicer shall be an institution which is a FNMA and
FHLMC approved seller/servicer in good standing, which has a net worth of at
least $15,000,000, and which is willing to service the Mortgage Loans and (i)
executes and delivers to the Depositor and the Trustee an agreement accepting
such delegation and assignment, which contains an assumption by such Person of
the rights, powers, duties, responsibilities, obligations and liabilities of
the Master Servicer (other than liabilities of the Master Servicer under
Section 6.03 hereof incurred prior to termination of the Master Servicer under
Section 7.01), with like effect as if originally named as a party to this
Agreement; and provided further that each Rating Agency acknowledges that its
rating of the Certificates in effect immediately prior to such assignment and
delegation will not be qualified or reduced, as a result of such assignment
and delegation and (ii) provides to the Depositor in writing fifteen days
prior to the effective date of such appointment and in form and substance
reasonably satisfactory to the Depositor, all information reasonably requested
by the Depositor in order to comply with its reporting obligation under Item
6.02 of Form 8-K with respect to a replacement master servicer. The Trustee
shall provide written notice to the Depositor of such successor pursuant to
this Section. Pending appointment of a successor to the Master Servicer
hereunder, the Trustee, unless the Trustee is prohibited by law from so
acting, shall, subject to Section 3.04 hereof, 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 Mortgage Loans as it and such successor shall agree; provided,
however, that no such compensation shall be in excess of the Master Servicing
Fee permitted 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 shall give
notice to the Mortgagors of such change of servicer and shall, during the term
of its service as master servicer maintain in force the policy or policies
that the Master Servicer is required to maintain pursuant to Section 3.09.
In connection with the termination or resignation of the Master
Servicer hereunder, either (i) the successor Master Servicer, including the
Trustee if the Trustee is acting as successor Master Servicer, shall represent
and warrant that it is a member of MERS in good standing and shall agree to
VII-3
comply in all material respects with the rules and procedures of MERS in
connection with the servicing of the Mortgage Loans that are registered with
MERS, or (ii) the predecessor Master Servicer shall cooperate with the
successor Master Servicer either (x) in causing MERS to execute and deliver an
assignment of Mortgage in recordable form to transfer the Mortgage from MERS
to the Trustee and to execute and deliver such other notices, documents and
other instruments as may be necessary or desirable to effect a transfer of
such Mortgage Loan or servicing of such Mortgage Loan on the MERS(R) System to
the successor Master Servicer or (y) in causing MERS to designate on the
MERS(R) System the successor Master Servicer as the servicer of such Mortgage
Loan. The predecessor Master Servicer shall file or cause to be filed any such
assignment in the appropriate recording office. The successor Master Servicer
shall cause such assignment to be delivered to the Trustee promptly upon
receipt of the original with evidence of recording thereon or a copy certified
by the public recording office in which such assignment was recorded.
SECTION 7.03. Notification to Certificateholders.
(a) Upon any termination of or appointment of a successor to the
Master Servicer, the Trustee shall give prompt written notice thereof to
Certificateholders and to each Rating Agency.
(b) Within 60 days after the occurrence of any Event of Default,
the Trustee shall transmit by mail to all Certificateholders notice of each
such Event of Default hereunder known to the Trustee, unless such Event of
Default shall have been cured or waived.
VII-4
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 hereof, the Trustee shall be entitled to rely
conclusively on the information delivered to it by the Master Servicer
in a Trustee Advance Notice in determining whether it is required 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
VIII-1
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);
(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.
VIII-2
SECTION 8.03. Trustee Not Liable for Certificates or Mortgage
Loans.
The recitals contained herein 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 System other than with respect to the Trustee's execution and
counter-signature of the Certificates. The Trustee shall not be accountable
for the use or application by the Depositor or the Master Servicer of any
funds paid to the Depositor or the Master Servicer in respect of the Mortgage
Loans or deposited in or withdrawn from the Certificate Account by the
Depositor or the Master Servicer.
SECTION 8.04. Trustee May Own Certificates.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Certificates with the same rights as it would have if it
were not the Trustee.
SECTION 8.05. Trustee's Fees and Expenses.
The Trustee, as compensation for its activities hereunder, shall
be entitled to withdraw from the Distribution Account on each Distribution
Date an amount equal to the Trustee Fee for such Distribution Date. The
Trustee and any director, officer, employee or agent of the Trustee shall be
indemnified by the Master Servicer and held harmless against any loss,
liability or expense (including reasonable attorney's fees) (i) incurred in
connection with any claim or legal action relating to (a) this Agreement, (b)
the Certificates or (c) in connection with the performance of any of the
Trustee's duties hereunder, other than any loss, liability or expense incurred
by reason of willful misfeasance, bad faith or negligence in the performance
of any of the Trustee's duties hereunder or incurred by reason of any action
of the Trustee taken at the direction of the Certificateholders and (ii)
resulting from any error in any tax or information return prepared by the
Master Servicer. Such indemnity shall survive the termination of this
Agreement or the resignation or removal of the Trustee hereunder. Without
limiting the foregoing, the Master Servicer covenants and agrees, except as
otherwise agreed upon in writing by the Depositor and the Trustee, and except
for any such expense, disbursement or advance as may arise from the Trustee's
negligence, bad faith or willful misconduct, to pay or reimburse the Trustee,
for all reasonable expenses, disbursements and advances incurred or made by
the Trustee in accordance with any of the provisions of this Agreement with
respect to: (A) the reasonable compensation and the expenses and disbursements
of its counsel not associated with the closing of the issuance of the
Certificates, (B) the reasonable compensation, expenses and disbursements of
any accountant, engineer or appraiser that is not regularly employed by the
Trustee, to the extent that the Trustee must engage such persons to perform
acts or services hereunder and (C) printing and engraving expenses in
connection with preparing any Definitive Certificates. Except as otherwise
provided herein, 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
VIII-3
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 hereof. 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.
As a condition to the effectiveness of any such resignation, at
least 15 calendar days prior to the effective date of such resignation, the
Trustee shall provide (x) written notice to the Depositor of any successor
pursuant to this Section and (y) in writing and in form and substance
reasonably satisfactory to the Depositor, all information reasonably requested
by the Depositor in order to comply with its reporting obligation under Item
6.02 of Form 8-K with respect to the resignation of the Trustee.
If at any time (i) the Trustee shall cease to be eligible in
accordance with the provisions of Section 8.06 hereof and shall fail to resign
after written request thereto by the Depositor, (ii) the Trustee shall become
incapable of acting, or shall be adjudged as bankrupt or insolvent, or a
receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, (iii)
a 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 or (iv) during the period
that the Depositor is required to file Exchange Act Reports with respect to
the Trust Fund, the Trustee fails to comply with its obligations under the
last sentence of Section 7.01, the preceding paragraph, Section 8.09 or
Article XI and such failure is not remedied within the lesser of 10 calendar
days or such period in which the applicable Exchange Act Report can be filed
timely (without taking into account any extensions), then, in the case of
clauses (i) through (iii), the Depositor or the Master Servicer, or in the
case of clause (iv), the Depositor, may remove 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 of which shall be delivered to
the successor trustee.
The Holders of Certificates entitled to at least 51% of the Voting
Rights may at any time remove the Trustee and appoint a successor trustee by
written instrument or instruments, 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, one complete set to the successor so
appointed and one complete set to the Depositor, together with a written
description of the basis of such removal. Notice of any removal of the Trustee
shall be given to each Rating Agency by the successor trustee.
VIII-4
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 hereof.
SECTION 8.08. Successor Trustee.
Any successor trustee appointed as provided in Section 8.07 hereof
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 herein. 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.
No successor trustee shall accept appointment as provided in this
Section 8.08 unless at the time of such acceptance such successor trustee
shall be eligible under the provisions of Section 8.06 hereof, its appointment
shall not adversely affect the then current rating of the Certificates and
such successor trustee has provided to the Depositor in writing and in form
and substance reasonably satisfactory to the Depositor, all information
reasonably requested by the Depositor in order to comply with its reporting
obligation under Item 6.02 of Form 8-K with respect to a replacement Trustee.
Upon acceptance of appointment by a successor trustee as provided
in this Section 8.08, the Depositor shall mail notice of the succession of
such trustee hereunder to all Holders of Certificates. If the Depositor fails
to mail such notice within 10 days after acceptance of appointment by the
successor trustee, the successor trustee shall cause such notice to be mailed
at the expense of the Depositor.
SECTION 8.09. Merger or Consolidation of Trustee.
Any corporation into which the Trustee may be merged or converted
or with which it may be consolidated or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any corporation succeeding to the business of the Trustee, shall be the
successor of the Trustee hereunder, provided that such corporation shall be
eligible under the provisions of Section 8.06 hereof without the execution or
filing of any paper or further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding.
As a condition to the effectiveness of any merger or
consolidation, at least 15 calendar days prior to the effective date of any
merger or consolidation of the Trustee, the Trustee shall provide (x) written
notice to the Depositor of any successor pursuant to this Section and (y) in
writing and in form and substance reasonably satisfactory to the Depositor,
all information reasonably requested by the Depositor in order to comply with
its reporting obligation under Item 6.02 of Form 8-K with respect to a
replacement Trustee.
SECTION 8.10. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any
time, for the purpose of meeting any legal requirements of any jurisdiction in
which any part of the Trust Fund or property securing any Mortgage Note may at
the time be located, the Master Servicer and the Trustee acting jointly shall
have the power and shall execute and deliver all instruments to appoint one or
more Persons approved by the Trustee to act as co-trustee or co-trustees
jointly with the Trustee, or separate trustee or
VIII-5
separate trustees, of all or any part of the Trust Fund, and to vest in such
Person or Persons, in such capacity and for the benefit of the
Certificateholders, such title to the Trust Fund or any part thereof,
whichever is applicable, and, subject to the other provisions of this Section
8.10, such powers, duties, obligations, rights and trusts as the Master
Servicer and the Trustee may consider necessary or desirable. If the Master
Servicer shall not have joined in such appointment within 15 days after the
receipt by it of a request to do so, or in the case an Event of Default shall
have occurred and be continuing, the Trustee alone shall have the power to
make such appointment. No co-trustee or separate trustee hereunder shall be
required to meet the terms of eligibility as a successor trustee under Section
8.06 and no notice to Certificateholders of the appointment of any co-trustee
or separate trustee shall be required under Section 8.08.
Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) To the extent necessary to effectuate the purposes of this
Section 8.10, all rights, powers, duties and obligations conferred or
imposed upon the Trustee, except for the obligation of the Trustee under
this Agreement to advance funds on behalf of the Master Servicer, shall
be conferred or imposed upon and exercised or performed by the Trustee
and such separate trustee or co-trustee jointly (it being understood
that such separate trustee or co-trustee is not authorized to act
separately without the Trustee joining in such act), except to the
extent that under any law of any jurisdiction in which any particular
act or acts are to be performed (whether as Trustee hereunder or as
successor to the Master Servicer hereunder), the Trustee shall be
incompetent or unqualified to perform such act or acts, in which event
such rights, powers, duties and obligations (including the holding of
title to the applicable Trust Fund or any portion thereof in any such
jurisdiction) shall be exercised and performed singly by such separate
trustee or co-trustee, but solely at the direction of the Trustee;
(ii) No trustee hereunder shall be held personally liable by
reason of any act or omission of any other trustee hereunder and such
appointment shall not, and shall not be deemed to, constitute any such
separate trustee or co-trustee as agent of the Trustee;
(iii) The Trustee may at any time accept the resignation of or
remove any separate trustee or co-trustee; and
(iv) The Master Servicer, and not the Trustee, shall be liable for
the payment of reasonable compensation, reimbursement and
indemnification to any such separate trustee or co-trustee.
Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the separate trustees and co-trustees,
when and as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement
and the conditions of this Article VIII. Each separate trustee and co-trustee,
upon its acceptance of the trusts conferred, shall be vested with the estates
or property specified in its instrument of appointment, either jointly with
the Trustee or separately, as may be provided therein, subject to all the
provisions of this Agreement, specifically including every provision of this
Agreement relating to the conduct of, affecting the liability of, or affording
protection to, the 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
VIII-6
shall die, become incapable of acting, resign or be removed, all of its
estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
SECTION 8.11. Tax Matters.
It is intended that the assets with respect to which any REMIC
election is to be made, as set forth in the Preliminary Statement, shall
constitute, and that the conduct of matters relating to such assets shall be
such as to qualify such assets as, a "real estate mortgage investment conduit"
as defined in and in accordance with the REMIC Provisions. In furtherance of
such intention, the Trustee covenants and agrees that it shall act as agent
(and the Trustee is hereby appointed to act as agent) on behalf of any such
REMIC and that in such capacity it shall: (a) prepare and file, or cause to be
prepared and filed, in a timely manner, a U.S. Real Estate Mortgage Investment
Conduit Income Tax Return (Form 1066 or any successor form adopted by the
Internal Revenue Service) and prepare and file or cause to be prepared and
filed with the Internal Revenue Service and applicable state or local tax
authorities income tax or information returns for each taxable year with
respect to any such REMIC, containing such information and at the times and in
the manner as may be required by the Code or state or local tax laws,
regulations, or rules, and furnish or cause to be furnished to
Certificateholders the schedules, statements or information at such times and
in such manner as may be required thereby; (b) within thirty days of the
Closing Date, furnish or cause to be furnished to the Internal Revenue
Service, on Forms 8811 or as otherwise may be required by the Code, the name,
title, address, and telephone number of the person that the holders of the
Certificates may contact for tax information relating thereto, together with
such additional information as may be required by such Form, and update such
information at the time or times in the manner required by the Code; (c) make
or cause to be made elections that such assets be treated as a REMIC on the
federal tax return for its first taxable year (and, if necessary, under
applicable state law); (d) prepare and forward, or cause to be prepared and
forwarded, to the Certificateholders and to the Internal Revenue Service and,
if necessary, state tax authorities, all information returns and reports as
and when required to be provided to them in accordance with the REMIC
Provisions, including without limitation, the calculation of any original
issue discount using the Prepayment Assumption; (e) provide information
necessary for the computation of tax imposed on the transfer of a Residual
Certificate to a Person that is not a Permitted Transferee, or an agent
(including a broker, nominee or other middleman) of a Non-Permitted
Transferee, or a pass-through entity in which a Non-Permitted Transferee is
the record holder of an interest (the reasonable cost of computing and
furnishing such information may be charged to the Person liable for such tax);
(f) to the extent that they are under its control conduct matters relating to
such assets at all times that any Certificates are outstanding so as to
maintain the status as a REMIC under the REMIC Provisions; (g) not knowingly
or intentionally take any action or omit to take any action that would cause
the termination of the tax status of any REMIC; (h) pay, from the sources
specified in the third 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
VIII-7
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
herein, 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 herein. The Depositor hereby indemnifies the Trustee for any losses,
liabilities, damages, claims or expenses of the Trustee arising from any
errors or miscalculations of the Trustee that result from any failure of the
Depositor to provide, or to cause to be provided, accurate information or data
to the Trustee on a timely basis.
In the event that any tax is imposed on "prohibited transactions"
of any REMIC hereunder as defined in Section 860F(a)(2) of the Code, on the
"net income from foreclosure property" of such REMIC as defined in Section
860G(c) of the Code, on any contribution to any REMIC hereunder after the
Startup Day pursuant to Section 860G(d) of the Code, or any other tax is
imposed, including, without limitation, any minimum tax imposed upon any REMIC
hereunder pursuant to Sections 23153 and 24874 of the California Revenue and
Taxation Code, if not paid as otherwise provided for herein, such tax shall be
paid by (i) the Trustee, if any such other tax arises out of or results from a
breach by the Trustee of any of its obligations under this Agreement, (ii) the
Master Servicer, in the case of any such minimum tax, or if such tax arises
out of or results from a breach by the Master Servicer or a Seller of any of
their obligations under this Agreement, (iii) any Seller, if any such tax
arises out of or results from that Seller's obligation to repurchase a
Mortgage Loan pursuant to Section 2.02 or 2.03 or (iv) in all other cases, or
in the event that the Trustee, the Master Servicer or any Seller fails to
honor its obligations under the preceding clauses (i),(ii) or (iii), any such
tax will be paid with amounts otherwise to be distributed to the
Certificateholders, as provided in Section 3.08(b).
The Trustee shall treat the Corridor Contract Reserve Fund as an
outside reserve fund within the meaning of Treasury Regulation 1.860G-2(h)
that is owned by the Underwriter (Senior) and that is not an asset of the
Trust Fund or any REMIC created hereunder. The Trustee shall treat the rights
of the Holders of the Covered Certificates to receive payments from the
Corridor Contract Reserve Fund as rights in an interest rate corridor contract
written by the Corridor Contract Counterparty. Thus, the Covered 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 interest, the Trustee shall assume that the Corridor Contracts entered
into by the Corridor Contract Counterparty in respect of the Class 1-A-6,
Class 1-A-15, Class 1-A-19, Class 1-A-21, Class 1-A-23 and Class 2-A-5
Certificates have a value of $28,939, $439,286, $739,189, $157,158, $53,703
and $131,021, respectively.
For federal income tax purposes the Trustee shall treat the ES
Trust as a Grantor Trust and shall treat each Holder of an ES Trust
Certificate as the owner of the individual, underlying assets represented by
such ES Trust Certificate. In addition, to the fullest extent possible,
ownership of an ES Trust Certificate shall be treated as direct ownership of
the individual, underlying assets represented by such ES Trust Certificate for
federal income tax reporting purposes.
VIII-8
SECTION 8.12. Monitoring of Significance Percentage.
With respect to each Distribution Date, the Trustee shall
calculate the "significance percentage" (as defined in Item 1115 of Regulation
AB) of each derivative instrument, if any, based on the aggregate Class
Certificate Balance of the related Classes of Covered Certificates for such
derivative instrument and Distribution Date (after all distributions to be
made thereon on such Distribution Date) and based on the methodology provided
in writing by or on behalf of Countrywide no later than the fifth Business Day
preceding such Distribution Date. On each Distribution Date, the Trustee shall
provide to Countrywide a written report (which written report may include
similar information with respect to other derivative instruments relating to
securitization transactions sponsored by Countrywide) specifying the
"significance percentage" of each derivative instrument, if any, for that
Distribution Date. If the "significance percentage" of any derivative
instrument exceeds 7.0% with respect to any Distribution Date, the Trustee
shall make a separate notation thereof in the written report described in the
preceding sentence. Such written report may contain such assumptions and
disclaimers as are deemed necessary and appropriate by the Trustee.
VIII-9
ARTICLE IX
TERMINATION
SECTION 9.01. Termination upon Liquidation or Purchase of all
Mortgage Loans.
Subject to Section 9.03, the obligations and responsibilities of
the Depositor, the Sellers, the Master Servicer and the Trustee created hereby
with respect to the Trust Fund shall terminate upon the earlier of (a) the
purchase by the Master Servicer of all Mortgage Loans (and REO Properties)
remaining in the Trust Fund at the price equal to the sum of (i) 100% of the
Stated Principal Balance of each Mortgage Loan plus one month's accrued
interest thereon at the applicable Adjusted Mortgage Rate, (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 related to any REO Property and (iii) any
remaining unpaid costs and damages incurred by the Trust Fund that arises out
of a violation of any predatory or abusive lending law that also constitutes a
breach of clause (49) 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 remaining in the Trust Fund and the disposition of all
REO Property and (ii) the distribution to Certificateholders 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 in the Trust Fund pursuant to clause (a) in the
preceding paragraph of this Section 9.01 only on or after the date on which
the Pool Stated Principal Balance, at the time of any such repurchase, is less
than or equal to ten percent (10%) of the Cut-off Date Pool Principal Balance.
The Supplemental Interest Trust shall terminate automatically upon
the termination of the Corridor Contract Reserve Fund.
The ES Trust shall terminate automatically upon termination of the
Trust Fund.
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
Trust Fund pursuant to clause (a) of Section 9.01, at least 20 days prior to
the date notice is to be mailed to the affected Certificateholders, the Master
Servicer shall notify the Depositor and the Trustee of the date the Master
Servicer intends to terminate the Trust Fund and of the applicable repurchase
price of the Mortgage Loans and REO Properties.
Notice of any termination of the Trust Fund, specifying the
Distribution Date on which Certificateholders may surrender their Certificates
for payment of the final distribution and cancellation, shall be given
promptly by the Trustee by letter to Certificateholders mailed not earlier
than the 10th day and no later than the 15th day of the month next preceding
the month of such final distribution. Any such notice shall specify (a) the
Distribution Date upon which final distribution on the Certificates will be
made upon presentation and surrender of Certificates at the office therein
designated, (b) the amount of
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such final distribution, (c) the location of the
office or agency at which such presentation and surrender must be made, and
(d) that the Record Date otherwise applicable to such Distribution Date is not
applicable, distributions being made only upon presentation and surrender of
the Certificates at the office therein specified. The Master Servicer will
give such notice to each Rating Agency at the time such notice is given to
Certificateholders.
In the event such notice is given, the Master Servicer shall cause
all funds in the Certificate Account to be remitted to the Trustee for deposit
in the Distribution Account on or before the Business Day prior to the
applicable Distribution Date in an amount equal to the final distribution in
respect of the Certificates. Upon such final deposit with respect to the Trust
Fund and the receipt by the Trustee of a Request for Release therefor, the
Trustee shall promptly release to the Master Servicer the Mortgage Files for
the Mortgage Loans.
Upon presentation and surrender of the Certificates, the Trustee
shall cause to be distributed to the Certificateholders of each Class, in each
case on the final Distribution Date and in the order set forth in Section
4.02, and 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 (a)
accrued interest thereon (or on their Notional Amount, if applicable) in the
case of an interest bearing Certificate and (b) any Class PO Deferred Amounts
in the case of Class PO Certificates, and (ii) as to the Residual
Certificates, the amount, if any, which remains on deposit in the Distribution
Account (other than the amounts retained to meet claims) after application
pursuant to clause (i) above. Notwithstanding the reduction of the Class
Certificate Balance of any Class of Certificates to zero, such Class will be
outstanding hereunder (solely for the purpose of receiving distributions and
not for any other purpose) until the termination of the respective obligations
and responsibilities of the Depositor, each Seller, the Master Servicer and
the Trustee hereunder in accordance with Article IX.
In the event that any affected Certificateholders shall not
surrender 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 Class A-R Certificateholders shall be entitled to all
unclaimed funds and other assets of the Trust Fund which remain subject
hereto.
The Supplemental Interest Trust shall terminate on the earlier of
(i) the last Corridor Contract Scheduled Termination Date and (ii) the date on
which the aggregate Class Certificate Balance of the Covered Certificates is
reduced to zero.
SECTION 9.03. Additional Termination Requirements.
(a) In the event the Master Servicer exercises its purchase option
as provided in Section 9.01, the Trust Fund shall be terminated in accordance
with the following additional requirements, unless the Trustee has been
supplied with an Opinion of Counsel, at the expense of the 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:
IX-2
(i) 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 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
(ii) Within 90 days after the time of adoption of such a plan of
complete liquidation, the Trustee shall sell all of the assets of the
Trust Fund to the Master Servicer for cash in accordance with Section
9.01.
(b) The Trustee, as agent for any REMIC created hereunder, hereby
agrees to adopt and sign such a plan of complete liquidation upon the written
request of the Master Servicer, and the receipt of the Opinion of Counsel
referred to in Section 9.03(a)(1) and to take such other action in connection
therewith as may be reasonably requested by the Master Servicer.
(c) By their acceptance of the Certificates, the Holders thereof
hereby authorize the Master Servicer to prepare and the Trustee to adopt and
sign a plan of complete liquidation.
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ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.01. Amendment.
This Agreement may be amended from time to time by the Depositor,
each Seller, the Master Servicer and the Trustee without the consent of any of
the Certificateholders (i) to cure any ambiguity or mistake, (ii) to correct
any defective provision herein or to supplement any provision herein which may
be inconsistent with any other provision herein, (iii) to conform this
Agreement to the Prospectus and Prospectus Supplement provided to investors in
connection with the initial offering of the Certificates, (iv) to add to the
duties of the Depositor, any Seller or the Master Servicer, (v) to modify,
alter, amend, add to or rescind any of the terms or provisions contained in
this Agreement to comply with any rules or regulations promulgated by the
Securities and Exchange Commission from time to time, (vi) to add any other
provisions with respect to matters or questions arising hereunder or (vii) to
modify, alter, amend, add to or rescind any of the terms or provisions
contained in this Agreement; provided that any action pursuant to clauses (vi)
or (vii) above shall not, as evidenced by an Opinion of Counsel (which Opinion
of Counsel shall not be an expense of the Trustee or the Trust Fund),
adversely affect in any material respect the interests of any
Certificateholder; provided, however, that the amendment shall be deemed not
to adversely affect in any material respect the interests of the
Certificateholders if the Person requesting the amendment obtains a letter
from each Rating Agency stating that the amendment would not result in the
downgrading or withdrawal of the respective ratings then assigned to the
Certificates; it being understood and agreed that any such letter in and of
itself will not represent a determination as to the materiality of any such
amendment and will represent a determination only as to the credit issues
affecting any such rating. Notwithstanding the foregoing, no amendment that
significantly changes the permitted activities of the trust created by this
Agreement may be made without the consent of a Majority in Interest of each
Class of Certificates affected by such amendment. Each party to this Agreement
hereby agrees that it will cooperate with each other party in amending this
Agreement pursuant to clause (v) above. The Trustee, each Seller, the
Depositor and the Master Servicer also may at any time and from time to time
amend this Agreement without the consent of the Certificateholders to modify,
eliminate or add to any of its provisions to such extent as shall be necessary
or helpful to (i) maintain the qualification of any REMIC as a REMIC under the
Code, (ii) avoid or minimize the risk of the imposition of any tax on any
REMIC pursuant to the Code that would be a claim at any time prior to the
final redemption of the Certificates or (iii) comply with any other
requirements of the Code, provided that the Trustee has been provided an
Opinion of Counsel, which opinion shall be an expense of the party requesting
such opinion but in any case shall not be an expense of the Trustee or the
Trust Fund, to the effect that such action is necessary or helpful to, as
applicable, (i) maintain such qualification, (ii) avoid or minimize the risk
of the imposition of such a tax or (iii) comply with any such requirements of
the Code.
This Agreement may also be amended from time to time by the
Depositor, each Seller, the Master Servicer and the Trustee with the consent
of the Holders of a Majority in Interest of each Class of Certificates
affected thereby for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Agreement or of
modifying in any manner the rights of the Holders of Certificates; provided,
however, that no such amendment shall (i) reduce in any manner the amount of,
or delay the timing of, payments required to be distributed on any Certificate
without the consent of the Holder of such Certificate, (ii) adversely affect
in any material respect the interests of the Holders of any Class of
Certificates in a manner other than as described in (i), without the consent
of the Holders of Certificates of such Class evidencing, as to such Class,
Percentage Interests aggregating 66-2/3%, or (iii) reduce the aforesaid
percentages of Certificates the Holders of which are required to consent to
any such amendment, without the consent of the Holders of all such
Certificates then outstanding.
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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 herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one
and the same instrument.
SECTION 10.03. Governing Law.
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED
BY THE SUBSTANTIVE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE
AND TO BE PERFORMED IN THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HERETO AND THE CERTIFICATEHOLDERS SHALL BE DETERMINED
IN ACCORDANCE WITH SUCH LAWS.
SECTION 10.04. Intention of Parties.
(a) It is the express intent of the parties hereto that the
conveyance of the (i) Mortgage Loans by the Sellers to the Depositor and (ii)
Trust Fund by the Depositor to the Trustee each be, and be construed as, an
absolute sale thereof to the Trustee. It is, further, not the intention of the
X-2
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 or any Supplemental Transfer Agreement is held
or deemed to create a security interest in either such assets, then (i) this
Agreement or any Supplemental Transfer 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 or any Supplemental
Transfer Agreement shall be deemed to be an assignment and a grant pursuant to
the terms of this Agreement (i) by each Seller to the Depositor or (ii) 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.
(b) The Depositor hereby represents that:
(i) This Agreement creates a valid and continuing security
interest (as defined in the Uniform Commercial Code as enacted in the
State of New York (the "NY UCC")) in the Mortgage Notes in favor of the
Trustee, which security interest is prior to all other liens, and is
enforceable as such as against creditors of and purchasers from the
Depositor.
(ii) The Mortgage Notes constitutes "instruments" within the
meaning of the NY UCC.
(iii) Immediately prior to the assignment of each Mortgage Loan to
the Trustee, the Depositor owns and has good and marketable title to
such Mortgage Loan free and clear of any lien, claim or encumbrance of
any Person.
(iv) The Depositor has received all consents and approvals
required by the terms of the Mortgage Loans to the sale of the Mortgage
Loans hereunder to the Trustee.
(v) All original executed copies of each Mortgage Note that are
required to be delivered to the Trustee pursuant to Section 2.01 have
been delivered to the Trustee.
(vi) Other than the security interest granted to the Trustee
pursuant to this Agreement, the Depositor has not pledged, assigned,
sold, granted a security interest in, or otherwise conveyed any of the
Mortgage Loans. The Depositor has not authorized the filing of and is
not aware of any financing statements against the Depositor that include
a description of collateral covering the Mortgage Loans other than any
financing statement relating to the security interest granted to the
Trustee hereunder or that has been terminated. The Depositor is not
aware of any judgment or tax lien filings against the Depositor.
(c) The Master Servicer shall take such action as is reasonably
necessary to maintain the perfection and priority of the security interest of
the Trustee in the Mortgage Loans; provided, however, that the obligation to
deliver the Mortgage File to the Trustee pursuant to Section 2.01 shall be
solely the Depositor's obligation and the Master Servicer shall not be
responsible for the safekeeping of the Mortgage Files by the Trustee.
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(d) It is understood and agreed that the representations and
warranties set forth in subsection (b) above shall survive delivery of the
Mortgage Files to the Trustee. Upon discovery by the Depositor or the Trustee
of a breach of any of the foregoing representations and warranties set forth
in subsection (b) above, which breach materially and adversely affects the
interest of the Certificateholders, the party discovering such breach shall
give prompt written notice to the others and to each Rating Agency.
SECTION 10.05. Notices.
(a) The Trustee shall use its best efforts to promptly provide
notice to each Rating Agency 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;
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 thereof.
In addition, the Trustee shall promptly furnish to each Rating
Agency copies of the following:
1. Each report to Certificateholders described in Section 4.06;
2. Each annual statement as to compliance described in Section
3.16;
3. Each annual independent public accountants' servicing report
described in Section 11.07; and
4. Any notice of a purchase of a Mortgage Loan pursuant to Section
2.02, 2.03 or 3.11.
(b) All directions, demands and notices hereunder 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: Xxxx Xxxxx, (2) in the case of
Countrywide, Countrywide Home Loans, Inc., 0000 Xxxx Xxxxxxx, Xxxxxxxxx,
Xxxxxxxxxx 00000, facsimile number: (000) 000-0000, Attention: Xxxx Xxxxx 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 LLC, c/o
Countrywide Financial Corporation, 0000 Xxxx Xxxxxxx, Xxxxxxxxx, Xxxxxxxxxx
00000, facsimile number: (000) 000-0000, Attention: Xxxx Xxxxx 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: Xxxx Xxxxx 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:
X-4
(000) 000-0000, Attention: Xxxx Xxxxx 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 2007-5CB, 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.
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 thereof.
SECTION 10.07. Assignment.
Notwithstanding anything to the contrary contained herein, 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 hereby, 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 herein) or in any manner otherwise control the operation and
management of the Trust Fund, or the obligations of the parties hereto, nor
shall anything herein set forth 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 hereof.
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
herein provided, 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
X-5
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 herein provided and for the common benefit of all
Certificateholders. For the protection and enforcement of the provisions of
this Section 10.08, each and every Certificateholder and the Trustee shall be
entitled to such relief as can be given either at law or in equity.
SECTION 10.09. Inspection and Audit Rights.
The Master Servicer agrees that, on reasonable prior notice, it
will permit and will cause each Subservicer to permit any representative of
the Depositor or the Trustee during the Master Servicer's normal business
hours, to examine all the books of account, records, reports and other papers
of the Master Servicer relating to the Mortgage Loans, to make copies and
extracts therefrom, to cause such books to be audited by independent certified
public accountants selected by the Depositor or the Trustee and to discuss its
affairs, finances and accounts relating to the Mortgage Loans with its
officers, employees and independent public accountants (and by this provision
the Master Servicer hereby authorizes said accountants to discuss with such
representative such affairs, finances and accounts), all at such reasonable
times and as often as may be reasonably requested. Any out-of-pocket expense
incident to the exercise by the Depositor or the Trustee of any right under
this Section 10.09 shall be borne by the party requesting such inspection; all
other such expenses shall be borne by the Master Servicer or the related
Subservicer.
SECTION 10.10. Certificates Nonassessable and Fully Paid.
It is the intention of the Depositor that Certificateholders shall
not be personally liable for obligations of the Trust Fund, that the interests
in the Trust Fund represented by the Certificates shall be nonassessable for
any reason whatsoever, and that the Certificates, upon due authentication
thereof by the Trustee pursuant to this Agreement, are and shall be deemed
fully paid.
SECTION 10.11. [Reserved]
SECTION 10.12. Protection of Assets.
(a) Except for transactions and activities entered into in
connection with the securitization that is the subject of this Agreement, the
Trust Fund created by this Agreement is not authorized and has no power to:
(i) borrow money or issue debt;
(ii) merge with another entity, reorganize, liquidate or sell
assets; or
(iii) engage in any business or activities.
(b) Each party to this Agreement agrees that it will not file an
involuntary bankruptcy petition against the Trustee or the Trust Fund or
initiate any other form of insolvency proceeding until after the Certificates
have been paid.
X-6
ARTICLE XI
EXCHANGE ACT REPORTING
SECTION 11.01. Filing Obligations.
The Master Servicer, the Trustee and each Seller shall reasonably
cooperate with the Depositor in connection with the satisfaction of the
Depositor's reporting requirements under the Exchange Act with respect to the
Trust Fund. In addition to the information specified below, if so requested by
the Depositor for the purpose of satisfying its reporting obligation under the
Exchange Act, the Master Servicer, the Trustee and each Seller shall (and the
Master Servicer shall cause each Subservicer to) provide the Depositor with
(a) such information which is available to such Person without unreasonable
effort or expense and within such timeframe as may be reasonably requested by
the Depositor to comply with the Depositor's reporting obligations under the
Exchange Act and (b) to the extent such Person is a party (and the Depositor
is not a party) to any agreement or amendment required to be filed, copies of
such agreement or amendment in XXXXX-compatible form.
SECTION 11.02. Form 10-D Filings.
(a) In accordance with the Exchange Act, the Trustee shall prepare
for filing and file within 15 days after each Distribution Date (subject to
permitted extensions under the Exchange Act) with the Commission with respect
to the Trust Fund, a Form 10-D with copies of the Monthly Report and, to the
extent delivered to the Trustee, no later than 10 days following the
Distribution Date, such other information identified by the Depositor or the
Master Servicer, in writing, to be filed with the Commission (such other
information, the "Additional Designated Information"). If the Depositor or
Master Servicer directs that any Additional Designated Information is to be
filed with any Form 10-D, the Depositor or Master Servicer, as the case may
be, shall specify the Item on Form 10-D to which such information is
responsive and, with respect to any Exhibit to be filed on Form 10-D, the
Exhibit number. Any information to be filed on Form 10-D shall be delivered to
the Trustee in XXXXX-compatible form or as otherwise agreed upon by the
Trustee and the Depositor or the Master Servicer, as the case may be, at the
Depositor's expense, and any necessary conversion to XXXXX-compatible format
will be at the Depositor's expense. At the reasonable request of, and in
accordance with the reasonable directions of, the Depositor or the Master
Servicer, subject to the two preceding sentences, the Trustee shall prepare
for filing and file an amendment to any Form 10-D previously filed with the
Commission with respect to the Trust Fund. The Master Servicer shall sign the
Form 10-D filed on behalf of the Trust Fund.
(b) No later than each Distribution Date, each of the Master
Servicer and the Trustee shall notify (and the Master Servicer shall cause any
Subservicer to notify) the Depositor and the Master Servicer of any Form 10-D
Disclosure Item, together with a description of any such Form 10-D Disclosure
Item in form and substance reasonably acceptable to the Depositor. In addition
to such information as the Master Servicer and the Trustee are obligated to
provide pursuant to other provisions of this Agreement, if so requested by the
Depositor, each of the Master Servicer and the Trustee shall provide such
information which is available to the Master Servicer and the Trustee, as
applicable, without unreasonable effort or expense regarding the performance
or servicing of the Mortgage Loans (in the case of the Trustee, based on the
information provided by the Master Servicer) as is reasonably required to
facilitate preparation of distribution reports in accordance with Item 1121 of
Regulation AB. Such information shall be provided concurrently with the
delivery of the reports specified in Section 4.06(c) in the case of the Master
Servicer and the Monthly Statement in the case of the Trustee, commencing with
the first such report due not less than five Business Days following such
request.
(c) The Trustee shall not have any responsibility to file any
items (other than those generated by it) that have not been received in a
format suitable (or readily convertible into a format suitable) for electronic
filing via the XXXXX system and shall not have any responsibility to convert
any
XI-1
such items to such format (other than those items generated by it or that
are readily convertible to such format). The Trustee shall have no liability
to the Certificateholders, the Trust Fund, the Master Servicer or the
Depositor with respect to any failure to properly prepare or file any of Form
10-D to the extent that such failure is not the result of any negligence, bad
faith or willful misconduct on its part.
SECTION 11.03. Form 8-K Filings.
The Master Servicer shall prepare and file on behalf of the Trust
Fund any Form 8-K required by the Exchange Act. Each Form 8-K must be signed
by the Master Servicer. Each of the Master Servicer (and the Master Servicer
shall cause any Subservicer to promptly notify) and the Trustee shall promptly
notify the Depositor and the Master Servicer (if the notifying party is not
the Master Servicer), but in no event later than one (1) Business Day after
its occurrence, of any Reportable Event of which it has actual knowledge. Each
Person shall be deemed to have actual knowledge of any such event to the
extent that it relates to such Person or any action or failure to act by such
Person. Concurrently with any transfer of Supplemental Mortgage Loans, if any,
Countrywide shall notify the Depositor and the Master Servicer, if any
material pool characteristic of the actual asset pool at the time of issuance
of the Certificates differs by 5% or more (other than as a result of the pool
assets converting into cash in accordance with their terms) from the
description of the asset pool in the Prospectus Supplement.
SECTION 11.04. Form 10-K Filings.
Prior to March 30th of each year, commencing in 2008 (or such
earlier date as may be required by the Exchange Act), the Depositor shall
prepare and file on behalf of the Trust Fund a Form 10-K, in form and
substance as required by the Exchange Act. A senior officer in charge of the
servicing function of the Master Servicer shall sign each Form 10-K filed on
behalf of the Trust Fund. Such Form 10-K shall include as exhibits each (i)
annual compliance statement described under Section 3.16, (ii) annual report
on assessments of compliance with servicing criteria described under Section
11.07 and (iii) accountant's report described under Section 11.07. Each Form
10-K shall also include any Xxxxxxxx-Xxxxx Certification required to be
included therewith, as described in Section 11.05.
If the Item 1119 Parties listed on Exhibit X have changed since
the Closing Date, no later than March 1 of each year, the Master Servicer
shall provide each of the Master Servicer (and the Master Servicer shall
provide any Subservicer) and the Trustee with an updated Exhibit X setting
forth the Item 1119 Parties. No later than March 15 of each year, commencing
in 2008, the Master Servicer and the Trustee shall notify (and the Master
Servicer shall cause any Subservicer to notify) the Depositor and the Master
Servicer of any Form 10-K Disclosure Item, together with a description of any
such Form 10-K Disclosure Item in form and substance reasonably acceptable to
the Depositor. Additionally, each of the Master Servicer and the Trustee shall
provide, and shall cause each Reporting Subcontractor retained by the Master
Servicer or the Trustee, as applicable, and in the case of the Master Servicer
shall cause each Subservicer, to provide, the following information no later
than March 15 of each year in which a Form 10-K is required to be filed on
behalf of the Trust Fund: (i) if such Person's report on assessment of
compliance with the servicing criteria described under Section 11.07 or
related registered public accounting firm attestation report described under
Section 11.07 identifies any material instance of noncompliance, notification
of such instance of noncompliance and (ii) if any such Person's report on
assessment of compliance with servicing criteria or related registered public
accounting firm attestation report is not provided to be filed as an exhibit
to such Form 10-K, information detailing the explanation why such report is
not included.
SECTION 11.05. Xxxxxxxx-Xxxxx Certification.
Each Form 10-K shall include a certification (the "Xxxxxxxx-Xxxxx
Certification") required by Rules 13a-14(d) and 15d-14(d) under the Exchange
Act (pursuant to Section 302 of the
XI-2
Xxxxxxxx-Xxxxx Act of 2002 and the rules and regulations of the Commission
promulgated thereunder (including any interpretations thereof by the
Commission's staff)). No later than March 15 of each year, beginning in 2008,
the Master Servicer and the Trustee shall (unless such person is the
Certifying Person), and the Master Servicer shall cause each Subservicer and
each Reporting Subcontractor and the Trustee shall cause each Reporting
Subcontractor to, provide to the Person who signs the Xxxxxxxx-Xxxxx
Certification (the "Certifying Person") a certification (each, a "Performance
Certification"), in the form attached hereto as Exhibit V-1 (in the case of a
Subservicer or any Reporting Subcontractor of the Master Servicer or a
Subservicer) and Exhibit V-2 (in the case of the Trustee or any Reporting
Subcontractor of the Trustee), on which the Certifying Person, the entity for
which the Certifying Person acts as an officer, and such entity's officers,
directors and Affiliates (collectively with the Certifying Person,
"Certification Parties") can reasonably rely. The senior officer in charge of
the servicing function of the Master Servicer shall serve as the Certifying
Person on behalf of the Trust Fund. Neither the Master Servicer nor the
Depositor will request delivery of a certification under this clause unless
the Depositor is required under the Exchange Act to file an annual report on
Form 10-K with respect to the Trust Fund. In the event that prior to the
filing date of the Form 10-K in March of each year, the Trustee or the
Depositor has actual knowledge of information material to the Xxxxxxxx-Xxxxx
Certification, the Trustee or the Depositor, as the case may be, shall
promptly notify the Master Servicer and the Depositor. The respective parties
hereto agree to cooperate with all reasonable requests made by any Certifying
Person or Certification Party in connection with such Person's attempt to
conduct any due diligence that such Person reasonably believes to be
appropriate in order to allow it to deliver any Xxxxxxxx-Xxxxx Certification
or portion thereof with respect to the Trust Fund.
SECTION 11.06. Form 15 Filing.
Prior to January 30 of the first year in which the Depositor is
able to do so under applicable law, the Depositor shall file a Form 15
relating to the automatic suspension of reporting in respect of the Trust Fund
under the Exchange Act.
SECTION 11.07. Report on Assessment of Compliance and Attestation.
(a) On or before March 15 of each calendar year, commencing in
2008:
(1) Each of the Master Servicer and the Trustee shall deliver to
the Depositor and the Master Servicer a report (in form and substance
reasonably satisfactory to the Depositor) regarding the Master Servicer's or
the Trustee's, as applicable, assessment of compliance with the Servicing
Criteria during the immediately preceding calendar year, as required under
Rules 13a-18 and 15d-18 of the Exchange Act and Item 1122 of Regulation AB.
Such report shall be signed by an authorized officer of such Person and shall
address each of the Servicing Criteria specified on a certification
substantially in the form of Exhibit W hereto delivered to the Depositor
concurrently with the execution of this Agreement. To the extent any of the
Servicing Criteria are not applicable to such Person, with respect to
asset-backed securities transactions taken as a whole involving such Person
and that are backed by the same asset type backing the Certificates, such
report shall include such a statement to that effect. The Depositor and the
Master Servicer, and each of their respective officers and directors shall be
entitled to rely on upon each such servicing criteria assessment.
(2) Each of the Master Servicer and the Trustee shall deliver to
the Depositor and the Master Servicer a report of a registered public
accounting firm reasonably acceptable to the Depositor that attests to, and
reports on, the assessment of compliance made by Master Servicer or the
Trustee, as applicable, and delivered pursuant to the preceding paragraphs.
Such attestation shall be in accordance with Rules 1-02(a)(3) and 2-02(g) of
Regulation S-X under the Securities Act and the Exchange Act, including,
without limitation that in the event that an overall opinion cannot be
expressed, such registered public accounting firm shall state in such report
why it was unable to express such an opinion. Such
XI-3
report must be available for general use and not contain restricted use
language. To the extent any of the Servicing Criteria are not applicable to
such Person, with respect to asset-backed securities transactions taken as a
whole involving such Person and that are backed by the same asset type backing
the Certificates, such report shall include such a statement that that effect.
(3) The Master Servicer shall cause each Subservicer and each
Reporting Subcontractor to deliver to the Depositor an assessment of
compliance and accountant's attestation as and when provided in paragraphs (a)
and (b) of this Section 11.07.
(4) The Trustee shall cause each Reporting Subcontractor to
deliver to the Depositor and the Master Servicer an assessment of compliance
and accountant's attestation as and when provided in paragraphs (a) and (b) of
this Section.
(5) The Master Servicer and the Trustee shall execute (and the
Master Servicer shall cause each Subservicer to execute, and the Master
Servicer and the Trustee shall cause each Reporting Subcontractor to execute)
a reliance certificate to enable the Certification Parties to rely upon each
(i) annual compliance statement provided pursuant to Section 3.16, (ii) annual
report on assessments of compliance with servicing criteria provided pursuant
to this Section 11.07 and (iii) accountant's report provided pursuant to this
Section 11.07 and shall include a certification that each such annual
compliance statement or report discloses any deficiencies or defaults
described to the registered public accountants of such Person to enable such
accountants to render the certification provided for in this Section 11.07. In
the event the Master Servicer, any Subservicer, the Trustee or Reporting
Subcontractor is terminated or resigns during the term of this Agreement, such
Person shall provide a certification to the Certifying Person pursuant to this
Section 11.07 with respect to the period of time it was subject to this
Agreement or provided services with respect to the Trust Fund, the
Certificates or the Mortgage Loans.
(b) In the event the Master Servicer, any Subservicer, the Trustee
or Reporting Subcontractor is terminated or resigns during the term of this
Agreement, such Person shall provide documents and information required by
this Section 11.07 with respect to the period of time it was subject to this
Agreement or provided services with respect to the Trust Fund, the
Certificates or the Mortgage Loans.
(c) Each assessment of compliance provided by a Subservicer
pursuant to Section 11.07(a)(3) shall address each of the Servicing Criteria
specified on a certification substantially in the form of Exhibit W hereto
delivered to the Depositor concurrently with the execution of this Agreement
or, in the case of a Subservicer subsequently appointed as such, on or prior
to the date of such appointment. An assessment of compliance provided by a
Subcontractor pursuant to Section 11.07(a)(3) or (4) need not address any
elements of the Servicing Criteria other than those specified by the Master
Servicer or the Trustee, as applicable, pursuant to Section 11.07(a)(1).
SECTION 11.08. Use of Subservicers and Subcontractors.
(a) The Master Servicer shall cause any Subservicer used by the
Master Servicer (or by any Subservicer) for the benefit of the Depositor to
comply with the provisions of Section 3.16 and this Article XI to the same
extent as if such Subservicer were the Master Servicer (except with respect to
the Master Servicer's duties with respect to preparing and filing any Exchange
Act Reports or as the Certifying Person). The Master Servicer shall be
responsible for obtaining from each Subservicer and delivering to the
Depositor any servicer compliance statement required to be delivered by such
Subservicer under Section 3.16, any assessment of compliance and attestation
required to be delivered by such Subservicer under Section 11.07 and any
certification required to be delivered to the Certifying Person under Section
11.05 as and when required to be delivered. As a condition to the succession
to any Subservicer as subservicer under this Agreement by any Person (i) into
which such Subservicer may be
XI-4
merged or consolidated, or (ii) which may be appointed as a successor to any
Subservicer, the Master Servicer shall provide to the Depositor, at least 15
calendar days prior to the effective date of such succession or appointment,
(x) written notice to the Depositor of such succession or appointment and (y)
in writing and in form and substance reasonably satisfactory to the Depositor,
all information reasonably requested by the Depositor in order to comply with
its reporting obligation under Item 6.02 of Form 8-K.
(b) It shall not be necessary for the Master Servicer, any
Subservicer or the Trustee to seek the consent of the Depositor or any other
party hereto to the utilization of any Subcontractor. The Master Servicer or
the Trustee, as applicable, shall promptly upon request provide to the
Depositor (or any designee of the Depositor, such as the Master Servicer or
administrator) a written description (in form and substance satisfactory to
the Depositor) of the role and function of each Subcontractor utilized by such
Person (or in the case of the Master Servicer or any Subservicer), specifying
(i) the identity of each such Subcontractor, (ii) which (if any) of such
Subcontractors are "participating in the servicing function" within the
meaning of Item 1122 of Regulation AB, and (iii) which elements of the
Servicing Criteria will be addressed in assessments of compliance provided by
each Subcontractor identified pursuant to clause (ii) of this paragraph.
As a condition to the utilization of any Subcontractor determined
to be a Reporting Subcontractor, the Master Servicer or the Trustee, as
applicable, shall cause any such Subcontractor used by such Person (or in the
case of the Master Servicer or any Subservicer) for the benefit of the
Depositor to comply with the provisions of Sections 11.07 and 11.09 of this
Agreement to the same extent as if such Subcontractor were the Master Servicer
(except with respect to the Master Servicer's duties with respect to preparing
and filing any Exchange Act Reports or as the Certifying Person) or the
Trustee, as applicable. The Master Servicer or the Trustee, as applicable,
shall be responsible for obtaining from each Subcontractor and delivering to
the Depositor and the Master Servicer, any assessment of compliance and
attestation required to be delivered by such Subcontractor under Section 11.05
and Section 11.07, in each case as and when required to be delivered.
SECTION 11.09. Amendments.
In the event the parties to this Agreement desire to further
clarify or amend any provision of this Article XI, this Agreement shall be
amended to reflect the new agreement between the parties covering matters in
this Article XI pursuant to Section 10.01, which amendment shall not require
any Opinion of Counsel or Rating Agency confirmations or the consent of any
Certificateholder. If, during the period that the Depositor is required to
file Exchange Act Reports with respect to the Trust Fund, the Master Servicer
is no longer an Affiliate of the Depositor, the Depositor shall assume the
obligations and responsibilities of the Master Servicer in this Article XI
with respect to the preparation and filing of the Exchange Act Reports and/or
acting as the Certifying Person, if the Depositor has received indemnity from
such successor Master Servicer satisfactory to the Depositor, and such Master
Servicer has agreed to provide a Xxxxxxxx-Xxxxx Certification to the Depositor
substantially in the form of Exhibit Y, and the certifications referred to in
Section 11.07.
SECTION 11.10. Reconciliation of Accounts.
Any reconciliation of Accounts performed by any party hereto, or
any Subservicer or Subcontractor shall be prepared no later than 45 calendar
days after the bank statement cutoff date.
* * * * * *
XI-5
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/ Xxxxxx Xxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxx
Title: First Vice President
THE BANK OF NEW YORK,
as Trustee
By: /s/ Xxxxxxxx Xxxxxx
-----------------------------------------
Name: Xxxxxxxx Xxxxxx
Title: Vice President
COUNTRYWIDE HOME LOANS, INC.,
as a Seller
By: /s/ Xxxxxx Xxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxx
Title: First Vice President
PARK GRANADA LLC,
as a Seller
By: /s/ Xxxxxx Xxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxx
Title: First Vice President
PARK MONACO INC.,
as a Seller
By: /s/ Xxxxxx Xxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxx
Title: First Vice President
PARK SIENNA LLC,
as a Seller
By: /s/ Xxxxxx Xxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxx
Title: First Vice President
COUNTRYWIDE HOME LOANS SERVICING LP,
as Master Servicer
By: COUNTRYWIDE GP, INC.
By: /s/ Xxxxxx Xxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxx
Title: First Vice President
Acknowledged solely with respect to the
Trustee's obligations under Section
4.01(b)
THE BANK OF NEW YORK, in its individual
capacity
By: /s/ Xxxx Xxxxxxxx
-----------------------------------------
Name: Xxxx Xxxxxxxx
Title: Vice President
SCHEDULE I
Mortgage Loan Schedule
[Delivered at Closing to Trustee]
S-I-1
SCHEDULE II-A
CWALT, Inc.
Mortgage Pass-Through Certificates
Series 2007-5CB
Representations and Warranties of Countrywide
Countrywide Home Loans, Inc. ("Countrywide") hereby makes the
representations and warranties set forth in this Schedule II-A to the
Depositor, the Master Servicer and the Trustee, as of the Closing Date.
Capitalized terms used but not otherwise defined in this Schedule II-A shall
have the meanings ascribed thereto in the Pooling and Servicing Agreement (the
"Pooling and Servicing Agreement") relating to the above-referenced Series,
among Countrywide Home Loans, Inc., as a seller, Park Granada LLC, as a
seller, Park Monaco Inc., as a seller, Park Sienna LLC, as a seller,
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 governmental body having jurisdiction over
Countrywide; and Countrywide is not in breach or violation of any
material
S-II-A-1
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 2007-5CB
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 LLC, as a seller,
Park Monaco Inc., as a seller, Park Sienna LLC, as a seller, Countrywide Home
Loans, Inc., as a seller, Countrywide Home Loans Servicing LP, as master
servicer, CWALT, Inc., as depositor, and The Bank of New York, as trustee.
(1) Park Granada is a limited liability company duly formed and
validly existing and in good standing under the laws of the State of
Delaware.
(2) Park Granada has the full corporate power and authority to
sell each Park Granada Mortgage Loan, and to execute, deliver and
perform, and to enter into and consummate the transactions contemplated
by the Pooling and Servicing Agreement and has duly authorized by all
necessary corporate action on the part of Park Granada the execution,
delivery and performance of the Pooling and Servicing Agreement; and the
Pooling and Servicing Agreement, assuming the due authorization,
execution and delivery thereof by the other parties thereto, constitutes
a legal, valid and binding obligation of Park Granada, enforceable
against Park Granada in accordance with its terms, except that (a) the
enforceability thereof may be limited by bankruptcy, insolvency,
moratorium, receivership and other similar laws relating to creditors'
rights generally and (b) the remedy of specific performance and
injunctive and other forms of equitable relief may be subject to
equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought.
(3) The execution and delivery of the Pooling and Servicing
Agreement by Park Granada, the sale of the Park Granada Mortgage Loans
by Park Granada under the Pooling and Servicing Agreement, the
consummation of any other of the transactions contemplated by the
Pooling and Servicing Agreement and the fulfillment of or compliance
with the terms thereof are in the ordinary course of business of Park
Granada and will not (A) result in a material breach of any term or
provision of the certificate of formation or the limited liability
company agreement of Park Granada or (B) materially conflict with,
result in a material breach, violation or acceleration of, or result in
a material default under, the terms of any other material agreement or
instrument to which Park Granada is a party or by which it may be bound,
or (C) constitute a material violation of any statute, order or
regulation applicable to Park Granada of any court, regulatory body,
administrative agency or governmental body having jurisdiction over Park
Granada; and Park Granada is not in breach or violation of any material
indenture or other 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.
S-II-B-1
(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 2007-5CB
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 incorporation or by-laws of Park Monaco or (B) materially
conflict with, result in a material breach, violation or acceleration
of, or result in a material default under, the terms of any other
material agreement or instrument to which Park Monaco is a party or by
which it may be bound, or (C) constitute a material violation of any
statute, order or regulation applicable to Park Monaco of any court,
regulatory body, administrative agency or governmental body having
jurisdiction over Park Monaco; and Park Monaco is not in breach or
violation of any material indenture or other material agreement or
instrument, or in violation of any statute, 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.
S-II-C-1
(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 2007-5CB
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, 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.
S-II-D-1
(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 2007-5CB
Representations and Warranties of Countrywide as to all of the Mortgage Loans
Countrywide Home Loans, Inc. ("Countrywide") hereby makes the
representations and warranties set forth in this Schedule III-A to the
Depositor, the Master Servicer and the Trustee, with respect to all of the
Mortgage Loans as of the Closing Date, or if so specified herein, as of the
Cut-off Date. Capitalized terms used but not otherwise defined in this
Schedule III-A shall have the meanings ascribed thereto in the Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement") relating to the
above-referenced Series, among Countrywide, as a seller, Park Granada LLC, as
a seller, Park Monaco Inc., as a seller, Park Sienna LLC, as a seller,
Countrywide Home Loans Servicing LP, as master servicer, CWALT, Inc., as
depositor, and The Bank of New York, as trustee.
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 Cut-off Date, none of the Mortgage Loans is 30 days
or more delinquent.
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.
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, 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
S-III-A-1
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, neither the Sellers 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 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; 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.
13) Each Mortgage Loan was originated (within the meaning of
Section 3(a)(41) of the Securities Exchange Act of 1934, as amended) by an
entity that satisfied at the time of origination the requirements of Section
3(a)(41) of the Securities Exchange Act of 1934, as amended.
14) To the best of Countrywide's knowledge, all of the
improvements which were included for the purpose of determining the Appraised
Value of the Mortgaged Property lie wholly within the boundaries and building
restriction lines of such property, and no improvements on adjoining
properties encroach upon the Mortgaged Property.
15) To the best of Countrywide's knowledge, no improvement located
on or being part of the Mortgaged Property is in violation of any applicable
zoning law or regulation. To the best of Countrywide's knowledge, all
inspections, licenses and certificates required to be made or issued with
respect to all occupied portions of the Mortgaged Property and, with respect
to the use and occupancy of the same, including but not limited to
certificates of occupancy and fire underwriting certificates, have been made
or obtained from the appropriate authorities, unless the lack thereof would
not have a material adverse effect on the value of such Mortgaged Property,
and the Mortgaged Property is lawfully occupied under applicable law.
16) Each Mortgage Note and the related Mortgage are genuine, and
each is the legal, valid and binding obligation of the maker thereof,
enforceable in accordance with its terms and under applicable law. To the best
of Countrywide's knowledge, all parties to the Mortgage Note and the Mortgage
had legal capacity to execute the Mortgage Note and the Mortgage and each
Mortgage Note and Mortgage have been duly and properly executed by such
parties.
17) The proceeds of the Mortgage Loans have been fully disbursed,
there is no requirement for future advances thereunder and any and all
requirements as to completion of any on-site or off-site
S-III-A-2
improvements and as to disbursements of any escrow funds therefor have been
complied with. All costs, fees and expenses incurred in making, or closing or
recording the Mortgage Loans were paid.
18) The related Mortgage contains customary and enforceable
provisions which render the rights and remedies of the holder thereof adequate
for the realization against the Mortgaged Property of the benefits of the
security, including, (i) in the case of a Mortgage designated as a deed of
trust, by trustee's sale, and (ii) otherwise by judicial foreclosure.
19) With respect to each Mortgage constituting a deed of trust, a
trustee, duly qualified under applicable law to serve as such, has been
properly designated and currently so serves and is named in such Mortgage, and
no fees or expenses are or will become payable by the Certificateholders to
the trustee under the deed of trust, except in connection with a trustee's
sale after default by the Mortgagor.
20) Each Mortgage Note and each Mortgage is in substantially one
of the forms acceptable to FNMA or FHLMC, with such riders as have been
acceptable to FNMA or FHLMC, as the case may be.
21) There exist no deficiencies with respect to escrow deposits
and payments, if such are required, for which customary arrangements for
repayment thereof have not been made, and no escrow deposits or payments of
other charges or payments due Countrywide have been capitalized under the
Mortgage or the related Mortgage Note.
22) The origination, underwriting and collection practices used by
Countrywide with respect to each Mortgage Loan have been in all respects
legal, prudent and customary in the mortgage lending and servicing business.
23) There is no pledged account or other security other than real
estate securing the Mortgagor's obligations.
24) No Mortgage Loan has a shared appreciation feature, or other
contingent interest feature.
25) Each Mortgage Loan contains a customary "due on sale" clause.
26) Approximately 13.18% of the Mortgage Loans in Loan Group 1, by
aggregate Stated Principal Balance of the Mortgage Loans in that Loan Group as
of the Cut-off Date, and none of the Group 2 Mortgage Loans provide for a
Prepayment Charge.
27) Each Mortgage Loan which had a Loan-to-Value Ratio at
origination in excess of 80.00% 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 of between 25 and 30 years is 12% for Loan-to-Value Ratios between
80.01% and 85.00%, 25% for Loan-to-Value Ratios between 85.01% and 90.00%, 30%
for Loan-to-Value Ratios between 90.01% and 95.00% and 35% for Loan-to-Value
Ratios between 95.01% and 100%. The specified coverage percentage for mortgage
loans with terms to maturity of up to 20 years ranges from 6% to 12% for
Loan-to-Value Ratios between 80.01% and 85.00%, from 12% to 20% for
Loan-to-Value Ratios between 85.01% and 90.00% and 20% to 25% for
Loan-to-Value Ratios between 90.01% and 95.00%. Each such Primary Insurance
Policy is issued by a Qualified Insurer. All provisions of any such Primary
Insurance Policy have been and are being complied with, any such policy is in
full force and effect, and all premiums due thereunder have been paid. Any
Mortgage subject to any such Primary Insurance Policy obligates either the
Mortgagor or the mortgagee thereunder to maintain such insurance and to pay
all premiums and charges in connection therewith, subject, in each case, to
the
S-III-A-3
provisions of Section 3.09(b) of the Pooling and Servicing Agreement. The
Mortgage Rate for each Mortgage Loan is net of any such insurance premium.
28) As of the Closing Date, the improvements upon each Mortgaged
Property are covered by a valid and existing hazard insurance policy with a
generally acceptable carrier that provides for fire and extended coverage and
coverage for such other hazards as are customary in the area where the
Mortgaged Property is located in an amount which is at least equal to the
lesser of (i) the maximum insurable value of the improvements securing such
Mortgage Loan or (ii) the greater of (a) the outstanding principal balance of
the Mortgage Loan and (b) an amount such that the proceeds of such policy
shall be sufficient to prevent the Mortgagor and/or the mortgagee from
becoming a co-insurer. If the Mortgaged Property is a condominium unit, it is
included under the coverage afforded by a blanket policy for the condominium
unit. All such individual insurance policies and all flood policies referred
to in item (29) 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.
29) If the Mortgaged Property is in an area identified in the
Federal Register by the Federal Emergency Management Agency as having special
flood hazards, a flood insurance policy in a form meeting the requirements of
the current guidelines of the Flood Insurance Administration is in effect with
respect to such Mortgaged Property with a generally acceptable carrier in an
amount representing coverage not less than the least of (A) the original
outstanding principal balance of the Mortgage Loan, (B) the minimum amount
required to compensate for damage or loss on a replacement cost basis, or (C)
the maximum amount of insurance that is available under the Flood Disaster
Protection Act of 1973, as amended.
30) To the best of Countrywide's knowledge, there is no proceeding
occurring, pending or threatened for the total or partial condemnation of the
Mortgaged Property.
31) There is no material monetary default existing under any
Mortgage or the related Mortgage Note and, to the best of Countrywide's
knowledge, there is no material event which, with the passage of time or with
notice and the expiration of any grace or cure period, would constitute a
default, breach, violation or event of acceleration under the Mortgage or the
related Mortgage Note; and Countrywide has not waived any default, breach,
violation or event of acceleration.
32) Each Mortgaged Property is improved by a one- to four-family
residential dwelling including condominium units and dwelling units in PUDs,
which, to the best of Countrywide's knowledge, does not include cooperatives
or mobile homes and does not constitute other than real property under state
law.
33) Each Mortgage Loan is being master serviced by the Master
Servicer.
34) Any future advances made prior to the Cut-off Date have been
consolidated with the outstanding principal amount secured by the Mortgage,
and the secured principal amount, as consolidated, bears a single interest
rate and single repayment term reflected on the Mortgage Loan Schedule. The
consolidated principal amount does not exceed the original principal amount of
the Mortgage Loan. The Mortgage Note does not permit or obligate the Master
Servicer to make future advances to the Mortgagor at the option of the
Mortgagor.
S-III-A-4
35) All taxes, governmental assessments, insurance premiums,
water, sewer and municipal charges, leasehold payments or ground rents which
previously became due and owing have been paid, or an escrow of funds has been
established in an amount sufficient to pay for every such item which remains
unpaid and which has been assessed, but is not yet due and payable. Except for
(A) payments in the nature of escrow payments, and (B) interest accruing from
the date of the Mortgage Note or date of disbursement of the Mortgage
proceeds, whichever is later, to the day which precedes by one month the Due
Date of the first installment of principal and interest, including without
limitation, taxes and insurance payments, the Master Servicer has not advanced
funds, or induced, solicited or knowingly received any advance of funds by a
party other than the Mortgagor, directly or indirectly, for the payment of any
amount required by the Mortgage.
36) Each Mortgage Loan was underwritten in all material respects
in accordance with Countrywide's underwriting guidelines as set forth in the
Prospectus Supplement.
37) Other than with respect to any Streamlined Documentation
Mortgage Loan as to which the loan-to-value ratio of the related Original
Mortgage Loan was less than 90% at the time of the origination of such
Original Mortgage Loan, prior to the approval of the Mortgage Loan
application, an appraisal of the related Mortgaged Property was obtained from
a qualified appraiser, duly appointed by the originator, who had no interest,
direct or indirect, in the Mortgaged Property or in any loan made on the
security thereof, and whose compensation is not affected by the approval or
disapproval of the Mortgage Loan; such appraisal is in a form acceptable to
FNMA and FHLMC.
38) None of the Mortgage Loans are graduated payment mortgage
loans or a growing equity mortgage loans, and none of the Mortgage Loans are
subject to a buydown or similar arrangement.
39) Any leasehold estate securing a Mortgage Loan has a term of
not less than five years in excess of the term of the related Mortgage Loan.
40) The Mortgage Loans were selected from among the outstanding
fixed-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.
41) Except for 1,278 and 113 Mortgage Loans in Loan Group 1 and
Loan Group 2, respectively, each Mortgage Loan has a payment date on or before
the Due Date in the month of the first Distribution Date.
42) With respect to any Mortgage Loan as to which an affidavit has
been delivered to the Trustee certifying that the original Mortgage Note is a
Lost Mortgage Note, if such Mortgage Loan is subsequently in default, the
enforcement of such Mortgage Loan or of the related Mortgage by or on behalf
of the Trustee will not be materially adversely affected by the absence of the
original Mortgage Note. A "Lost Mortgage Note" is a Mortgage Note the original
of which was permanently lost or destroyed and has not been replaced.
43) The Mortgage Loans, individually and in the aggregate, conform
in all material respects to the descriptions thereof in the Prospectus
Supplement.
44) The aggregate principal balance of the Discount Mortgage Loans
will not exceed $95,354,758.05 in Loan Group 1 and $10,358,139.82 in Loan
Group 2.
S-III-A-5
45) With respect to any mortgage loan that contains a provision
permitting imposition of a penalty upon a prepayment prior to maturity: (a)
the mortgage loan provides some benefit to the borrower in exchange for
accepting such prepayment penalty; (b) the mortgage loan's originator had a
written policy of offering the borrower, or requiring third-party brokers to
offer the borrower, the option of obtaining a mortgage loan that did not
require payment of such a penalty; (c) the prepayment penalty was adequately
disclosed to the borrower pursuant to applicable state and federal law; (d)
the mortgage loan does not provide for prepayment penalty for a term in excess
of five years; in each case unless the loan was modified to reduce the
prepayment period to no more than three years from the date of the note and
the borrower was notified in writing of such reduction in prepayment period;
and (e) such prepayment penalty will not be imposed in any instance where the
mortgage loan is accelerated or paid off in connection with the workout of a
delinquent mortgage or due to the borrower's default, notwithstanding that the
terms of the mortgage loan or state or federal law might permit the imposition
of such penalty.
46) The Master Servicer 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 related to the Mortgage Loans to Equifax, Experian and Trans Union
Credit Information Company (three of the nationally recognized credit bureaus)
on a monthly basis.
47) The original principal balance of each Mortgage Loan is within
the dollar amount limits of Xxxxxxx Mac and Xxxxxx Mae for conforming one- to
four-family mortgage loans.
48) No Mortgage Loan originated between October 1, 2002 and March
7, 2003 is subject to the Georgia Fair Lending Act, as amended. No Mortgage
Loan originated between October 1, 2002 and March 7, 2003 is secured by a
Mortgaged Property located in the state of Georgia, and there is no Mortgage
Loan originated on or after March 7, 2003 that is a "high cost home loan" as
defined under the Georgia Fair Lending Act.
49) None of the Mortgage Loans are "high cost" loans as defined by
applicable predatory and abusive lending laws.
50) None of the Mortgage Loans are covered by the Home Ownership
and Equity Protection Act of 1994 ("HOEPA").
51) 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.).
52) 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.).
53) No Mortgage Loan is a "High-Cost Home Mortgage Loan" as
defined in the Massachusetts Predatory Home Loan Practices Act effective
November 7, 2004 (Mass. Gen. Law ch. 183C).
54) No Mortgage Loan originated on or after January 1, 2005 is a
"High-Cost Home Loan" as defined in the Indiana Home Loan Practices Act,
effective January 1, 2005 (Ind. Code Xxx. Sections 24-9-1 through 24-9-9).
55) 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.
S-III-A-6
56) 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 5.7 Glossary Revised, Appendix E which is attached
hereto as Exhibit Q (the "Glossary") where (x) a "High Cost Loan" is each loan
identified in the column "Category under applicable anti-predatory lending
law" of the table entitled "Standard & Poor's High Cost Loan Categorization"
in the Glossary as each such loan is defined in the applicable anti-predatory
lending law of the State or jurisdiction specified in such table and (y) a
"Covered Loan" is each loan identified in the column "Category under
applicable anti-predatory lending law" of the table entitled "Standard &
Poor's Covered Loan Categorization" in the Glossary as each such loan is
defined in the applicable anti-predatory lending law of the State or
jurisdiction specified in such table.
57) No Mortgage Loan in any Loan Group originated between October
1, 2002 and March 7, 2003 is subject to the Georgia Fair Lending Act, as
amended. No Mortgage Loan in any Loan Group originated between October 1, 2002
and March 7, 2003 is secured by a Mortgaged Property located in the state of
Georgia, and there is no Mortgage Loan originated on or after March 7, 2003
that is a "high cost home loan" as defined under the Georgia Fair Lending Act.
58) No Mortgagor related to a Mortgage Loan in any Loan Group 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 any Loan Group 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 any Loan Group
were used to purchase single premium credit insurance policies or debt
cancellation agreements as part of the origination or, or as a condition to
closing, such Mortgage Loan.
59) With respect to all of the Mortgage Loans originated from
August 1, 2004 through April 30, 2005, if the related Mortgage Loan 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
borrower to submit to arbitration to resolve any dispute arising out of or
relating in any way to the mortgage loan transaction), Countrywide will (i)
notify the related borrower in writing within 60 days after the Closing Date
that none of the related seller, the related servicer or any subsequent party
that acquires an interest in the Mortgage Loan or services the Mortgage Loan
will enforce the arbitration clause against the borrower, but that the
borrower will continue to have the right to submit a dispute to arbitration
and (ii) place a copy of that notice in the Mortgage File; and with respect to
any Mortgage Loan originated on or after May 1, 2005, neither the related
mortgage nor the related mortgage note requires the borrower to submit to
arbitration to resolve any dispute arising out of or relating in any way to
the mortgage loan transaction.
60) The originator of each Mortgage Loan offered the related
borrower mortgage loan products offered by such Mortgage Loan's originator, or
any affiliate of such Mortgage Loan's originator, for which the borrower
qualified.
61) The methodology used in underwriting the extension of credit
for each Mortgage Loan employs objective mathematical principles which relate
the borrower's income, assets and liabilities to the proposed payment and such
underwriting methodology does not rely on the extent of the borrower's equity
in the collateral as the principal determining factor in approving such credit
extension. Such underwriting methodology confirmed that at the time of
origination (application/approval) the borrower had the reasonable ability to
make timely payments on the mortgage loan.
62) No borrower under a Mortgage Loan was charged "points and
fees" in an amount greater than (a) $1,000 or (b) 5% of the principal amount
of such Mortgage Loan, whichever is greater. For
S-III-A-7
purposes of this representation, "points and fees" (x) include origination,
underwriting, broker and finder's fees and charges that the lender imposed as
a condition of making the Mortgage Loan, whether they are paid to the lender
or a third party; and (y) exclude bona fide discount points, fees paid for
actual services rendered in connection with the origination of the Mortgage
Loan (such as attorneys' fees, notaries fees and fees paid for property
appraisals, credit reports, surveys, title examinations and extracts, flood
and tax certifications, and home inspections); the cost of mortgage insurance
or credit-risk price adjustments; the costs of title, hazard, and flood
insurance policies; state and local transfer taxes or fees; escrow deposits
for the future payment of taxes and insurance premiums; and other
miscellaneous fees and charges that, in total, do not exceed 0.25 percent of
the loan amount.
63) All points, fees and charges (including finance charges),
whether or not financed, assessed, collected or to be collected in connection
with the origination and servicing of each Mortgage Loan, have been disclosed
in writing to the borrower in accordance with applicable state and federal law
and regulation.
64) As of the Closing Date with respect to the Mortgage Loans or
the applicable date of substitution with respect to any Substitute Mortgage
Loan, none of the Mortgaged Properties is a mobile home or a manufactured
housing unit that is not considered or classified as part of the real estate
under the laws of the jurisdiction in which it is located.
S-III-A-8
SCHEDULE III-B
CWALT, Inc.
Mortgage Pass-Through Certificates
Series 2007-5CB
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 2007-5CB
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. 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.
(1) 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 2007-5CB
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 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-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 2007-5CB
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 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-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, 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 2007-5CB
Representations and Warranties of the Master Servicer
Countrywide Home Loans Servicing LP ("Countrywide Servicing")
hereby makes the representations and warranties set forth in this Schedule IV
to the Depositor, the Sellers and the Trustee, as of the Closing Date.
Capitalized terms used but not otherwise defined in this Schedule IV shall
have the meanings ascribed thereto in the Pooling and Servicing Agreement (the
"Pooling and Servicing Agreement") relating to the above-referenced Series,
among Countrywide Home Loans, Inc., as a seller, Park Granada LLC, as a
seller, Park Monaco Inc., as a seller, Park Sienna LLC, as a seller,
Countrywide Home Loans Servicing LP, as master servicer, CWALT, Inc., as
depositor, and The Bank of New York, as trustee.
(1) Countrywide Servicing is duly organized as a limited partnership and
is validly existing and in good standing under the laws of the State of
Texas and is duly authorized and qualified to transact any and all
business contemplated by the Pooling and Servicing Agreement to be
conducted by Countrywide Servicing in any state in which a Mortgaged
Property is located or is otherwise not required under applicable law to
effect such qualification and, in any event, is in compliance with the
doing business laws of any such state, to the extent necessary to
perform any of its obligations under the Pooling and Servicing Agreement
in accordance with the terms thereof.
(2) Countrywide Servicing has the full partnership power and authority
to service each Mortgage Loan, and to execute, deliver and perform, and
to enter into and consummate the transactions contemplated by the
Pooling and Servicing Agreement and has duly authorized by all necessary
partnership action on the part of Countrywide Servicing the execution,
delivery and performance of the Pooling and Servicing Agreement; and the
Pooling and Servicing Agreement, assuming the due authorization,
execution and delivery thereof by the other parties thereto, constitutes
a legal, valid and binding obligation of Countrywide Servicing,
enforceable against Countrywide Servicing in accordance with its terms,
except that (a) the enforceability thereof may be limited by bankruptcy,
insolvency, moratorium, receivership and other similar laws relating to
creditors' rights generally and (b) the remedy of specific performance
and injunctive and other forms of equitable relief may be subject to
equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought.
(3) The execution and delivery of the Pooling and Servicing Agreement by
Countrywide Servicing, the servicing of the Mortgage Loans by
Countrywide Servicing under the Pooling and Servicing Agreement, the
consummation of any other of the transactions contemplated by the
Pooling and Servicing Agreement, and the fulfillment of or compliance
with the terms thereof are in the ordinary course of business of
Countrywide Servicing and will not (A) result in a material breach of
any term or provision of the certificate of limited partnership,
partnership agreement or other organizational document of Countrywide
Servicing or (B) materially conflict with, result in a material breach,
violation or acceleration of, or result in a material default under, the
terms of any other material agreement or instrument to which Countrywide
Servicing is a party or by which it may be bound, or (C) constitute a
material violation of any statute, order or regulation
S-IV-1
applicable to Countrywide Servicing of any court, regulatory body,
administrative agency or governmental body having jurisdiction over
Countrywide Servicing; and Countrywide Servicing is not in breach or
violation of any material indenture or other material agreement or
instrument, or in violation of any statute, order or regulation of any
court, regulatory body, administrative agency or governmental body
having jurisdiction over it which breach or violation may materially
impair the ability of Countrywide Servicing to perform or meet any of
its obligations under the Pooling and Servicing Agreement.
(4) Countrywide Servicing is an approved servicer of conventional
mortgage loans for FNMA or FHLMC and is a mortgagee approved by the
Secretary of Housing and Urban Development pursuant to sections 203 and
211 of the National Housing Act.
(5) No litigation is pending or, to the best of Countrywide Servicing's
knowledge, threatened, against Countrywide Servicing that would
materially and adversely affect the execution, delivery or
enforceability of the Pooling and Servicing Agreement or the ability of
Countrywide Servicing to service the Mortgage Loans or to perform any of
its other obligations under the Pooling and Servicing Agreement in
accordance with the terms thereof.
(6) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by Countrywide Servicing of, or compliance by Countrywide
Servicing with, the Pooling and Servicing Agreement or the consummation
of the transactions contemplated thereby, or if any such consent,
approval, authorization or order is required, Countrywide Servicing has
obtained the same.
(7) Countrywide Servicing is a member of MERS in good standing, and will
comply in all material respects with the rules and procedures of MERS in
connection with the servicing of the MERS Mortgage Loans for as long as
such Mortgage Loans are registered with MERS.
S-IV-2
SCHEDULE V
Principal 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-VII-1
SCHEDULE VII
Available Exchanges of Depositable Certificates for Exchangeable Certificates
(1)(2)
Classes of Depositable Certificates Related Classes of Exchangeable Certificates
----------------------------------- -----------------------------------------------------
Original
Classes of Certificate Classes of Maximum Original
Depositable Balance or Exchangeable Certificate Balance
Certificates Notional Amount Certificates or Notional Amount Pass-Through Rate
------------ --------------- ------------ ------------------- -----------------
Recombination 1
Class 1-A-1 $ 143,325,000 Class 1-A-25 $ 95,550,000 5.50%
Class 1-A-26 $ 47,775,000(3) 6 75% - LIBOR
Class 1-A-27 $ 47,775,000 LIBOR + 0 25
Recombination 2
Class 1-A-1 $ 143,325,000 Class 1-A-28 $ 114,660,000 5.75%
Class 1-A-29 $ 28,665,000(3) 6 75% - LIBOR
Class 1-A-30 $ 28,665,000 LIBOR + 0 25
Recombination 3
Class 1-A-10 $ 340,743,000 Class 1-A-31 $ 227,162,000 5.50%
Class 1-A-32 $ 113,581,000(3) 6 75% - LIBOR
Class 1-A-33 $ 113,581,000 LIBOR + 0 25
Recombination 4
Class 1-A-10 $ 340,743,000 Class 1-A-34 $ 272,595,000 5.75%
Class 1-A-35 $ 68,148,000(3) 6 75% - LIBOR
Class 1-A-36 $ 68,148,000 LIBOR + 0 25
Recombination 5
Class 1-A-1 $ 143,325,000 Class 1-A-37 $ 188,098,000 6.00%
Class 1-A-2 $ 44,773,000
--------------
(1) Depositable Certificates and Exchangeable Certificates may be exchanged
only in the proportions shown in this Schedue VII. In any exchange, the
relative proportions of the Depositable Certificates to be delivered
(or, if applicable, received) in such exchange will equal the
proportions reflected by the outstanding Class Certificate Balances of
the related Depositable Certificates at the time of exchange.
(2) If, as a result of a proposed exchange, a certificateholder would hold a
Depositable Certificate or Exchangeable Certificate of a class in an
amount less than the applicable minimum denomination for that class, the
certificateholder will be unable to effect the proposed exchange. See
the Preliminary Statement.
(3) This class of certificates is a class of interest-only notional amount
certificates. The notional amount reflected in the table represents the
maximum initial notional amount for this class of certificates.
S-VII-1
