Depositor, DLJ MORTGAGE CAPITAL, INC.,
Execution Copy
______________________________________________________________________________________________________
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.,
Depositor,
DLJ MORTGAGE CAPITAL, INC.,
Seller,
XXXXX FARGO BANK, N.A.,
Master Servicer, Servicer and Trust Administrator,
SELECT PORTFOLIO SERVICING, INC.,
Servicer and Special Servicer,
GREENPOINT MORTGAGE FUNDING, INC.,
Servicer
and
U.S. BANK NATIONAL ASSOCIATION,
Trustee
POOLING AND SERVICING AGREEMENT
DATED AS OF JULY 1, 2006
relating to
ADJUSTABLE RATE MORTGAGE TRUST 2006-3
ADJUSTABLE RATE MORTGAGE-BACKED PASS-THROUGH CERTIFICATES,
SERIES 2006-3
______________________________________________________________________________________________________
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS............................................................................................11
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES..........................................68
SECTION 2.01. Conveyance of Trust Fund..............................................................68
SECTION 2.02. Acceptance by the Trustee.............................................................72
SECTION 2.03. Representations and Warranties of the Seller, Master Servicer and
Servicers.............................................................................74
SECTION 2.04. Representations and Warranties of the Depositor as to the Mortgage
Loans.................................................................................76
SECTION 2.05. Delivery of Opinion of Counsel in Connection with Substitutions.......................76
SECTION 2.06. Issuance of Certificates..............................................................77
SECTION 2.07. REMIC Provisions......................................................................77
SECTION 2.08. Covenants of the Master Servicer and each Servicer....................................82
ARTICLE III ADMINISTRATION AND SERVICING OF MORTGAGE LOANS.......................................................83
SECTION 3.01. Servicers to Service Mortgage Loans...................................................83
SECTION 3.02. Subservicing; Enforcement of the Obligations of Sub-Servicers.........................85
SECTION 3.03. Master Servicing by Master Servicer...................................................87
SECTION 3.04. Trustee to Act as Master Servicer or Servicer.........................................87
SECTION 3.05. Collection of Mortgage Loans; Collection Accounts; Certificate
Account...............................................................................88
SECTION 3.06. Establishment of and Deposits to Escrow Accounts; Permitted
Withdrawals from Escrow Accounts; Payments of Taxes, Insurance and
Other Charges.........................................................................91
SECTION 3.07. Access to Certain Documentation and Information Regarding the
Non-Designated Mortgage Loans; Inspections............................................93
SECTION 3.08. Permitted Withdrawals from the Collection Accounts and Certificate
Account...............................................................................93
SECTION 3.09. Maintenance of Hazard Insurance; Mortgage Impairment Insurance and
Mortgage Guaranty Insurance Policy; Claims; Restoration of
Mortgaged Property....................................................................95
SECTION 3.10. Enforcement of Due on Sale Clauses; Assumption Agreements.............................99
SECTION 3.11. Realization Upon Defaulted Mortgage Loans; Repurchase of Certain
Mortgage Loans.......................................................................100
SECTION 3.12. Trustee and Trust Administrator to Cooperate; Release of Mortgage
Files................................................................................104
SECTION 3.13. Documents, Records and Funds in Possession of a Servicer to be
Held for the Trust...................................................................104
SECTION 3.14. Servicing Fee; Indemnification of Master Servicer....................................105
SECTION 3.15. Access to Certain Documentation......................................................106
SECTION 3.16. Maintenance of Fidelity Bond and Errors and Omissions Insurance......................106
SECTION 3.17. Special Serviced Mortgage Loans......................................................106
SECTION 3.18. Indemnification of Servicers and Master Servicer.....................................107
SECTION 3.19. Notification of Adjustments..........................................................107
SECTION 3.20. Designated Mortgage Loans............................................................107
SECTION 3.21. Assigned Prepayment Premiums.........................................................109
ARTICLE IV PAYMENTS AND STATEMENTS TO CERTIFICATEHOLDERS........................................................110
SECTION 4.01. Priorities of Distribution...........................................................110
SECTION 4.02. Allocation of Losses.................................................................121
SECTION 4.03. Recoveries...........................................................................122
SECTION 4.04. Reserved.............................................................................123
SECTION 4.05. Monthly Statements to Certificateholders.............................................123
SECTION 4.06. Servicer to Cooperate................................................................124
SECTION 4.07. Cross-Collateralization; Adjustments to Available Funds..............................124
SECTION 4.08. Group 4 Interest Rate Cap Accounts...................................................125
SECTION 4.09. Supplemental Interest Trust..........................................................129
SECTION 4.10. Rights of Swap Counterparty..........................................................130
SECTION 4.11. Replacement Swap Counterparty........................................................131
ARTICLE V ADVANCES BY THE MASTER SERVICER AND SERVICERS.........................................................132
SECTION 5.01. Advances by the Master Servicer and Servicers........................................132
ARTICLE VI THE CERTIFICATES.....................................................................................133
SECTION 6.01. The Certificates.....................................................................133
SECTION 6.02. Registration of Transfer and Exchange of Certificates................................134
SECTION 6.03. Mutilated, Destroyed, Lost or Stolen Certificates....................................139
SECTION 6.04. Persons Deemed Owners................................................................139
SECTION 6.05. Access to List of Certificateholders' Names and Addresses............................139
SECTION 6.06. Maintenance of Office or Agency......................................................139
SECTION 6.07. Book Entry Certificates..............................................................140
SECTION 6.08. Notices to Clearing Agency...........................................................140
SECTION 6.09. Definitive Certificates..............................................................141
ARTICLE VII THE DEPOSITOR, THE SELLER, THE MASTER SERVICER, THE SERVICERS AND THE SPECIAL
SERVICER.....................................................................................142
SECTION 7.01. Liabilities of the Seller, the Depositor, the Master Servicer, the
Servicers and the Special Servicer...................................................142
SECTION 7.02. Merger or Consolidation of the Seller, the Depositor, the Master
Servicer, the Servicers or the Special Servicer......................................142
SECTION 7.03. Limitation on Liability of the Seller, the Depositor, the Master
Servicer, the Servicers, the Special Servicer and Others.............................143
SECTION 7.04. Master Servicer and Servicer Not to Resign; Transfer of Servicing....................143
SECTION 7.05. Master Servicer, Seller and Servicers May Own Certificates...........................144
ARTICLE VIII DEFAULT............................................................................................145
SECTION 8.01. Events of Default....................................................................145
SECTION 8.02. Master Servicer or Trust Administrator to Act; Appointment of
Successor............................................................................147
SECTION 8.03. Notification to Certificateholders...................................................149
SECTION 8.04. Waiver of Events of Default..........................................................149
ARTICLE IX CONCERNING THE TRUSTEE...............................................................................150
SECTION 9.01. Duties of Trustee....................................................................150
SECTION 9.02. Certain Matters Affecting the Trustee................................................151
SECTION 9.03. Trustee Not Liable for Certificates or Mortgage Loans................................152
SECTION 9.04. Trustee May Own Certificates.........................................................153
SECTION 9.05. Trustee's Fees and Expenses..........................................................153
SECTION 9.06. Eligibility Requirements for Trustee.................................................153
SECTION 9.07. Resignation and Removal of Trustee...................................................154
SECTION 9.08. Successor Trustee....................................................................154
SECTION 9.09. Merger or Consolidation of Trustee...................................................155
SECTION 9.10. Appointment of Co-Trustee or Separate Trustee........................................155
SECTION 9.11. Office of the Trustee................................................................156
ARTICLE X CONCERNING THE TRUST ADMINISTRATOR....................................................................157
SECTION 10.01. Duties of Trust Administrator........................................................157
SECTION 10.02. Certain Matters Affecting the Trust Administrator....................................158
SECTION 10.03. Trust Administrator Not Liable for Certificates or Mortgage Loans....................160
SECTION 10.04. Trust Administrator May Own Certificates.............................................160
SECTION 10.05. Trust Administrator's Fees and Expenses..............................................160
SECTION 10.06. Eligibility Requirements for Trust Administrator.....................................161
SECTION 10.07. Resignation and Removal of Trust Administrator.......................................161
SECTION 10.08. Successor Trust Administrator........................................................162
SECTION 10.09. Merger or Consolidation of Trust Administrator.......................................163
SECTION 10.10. Appointment of Co-Trust Administrator or Separate Trust
Administrator........................................................................163
SECTION 10.11. Office of the Trust Administrator....................................................164
SECTION 10.12. Tax Return...........................................................................164
SECTION 10.13. Determination of Certificate Index...................................................164
ARTICLE XI TERMINATION..........................................................................................165
SECTION 11.01. Termination upon Liquidation or Purchase of all Mortgage Loans.......................165
SECTION 11.02. Determination of the Terminating Entity..............................................167
SECTION 11.03. Procedure Upon Optional Termination or Terminating Auction Sale......................168
SECTION 11.04. Additional Termination Requirements..................................................169
ARTICLE XII MISCELLANEOUS PROVISIONS............................................................................171
SECTION 12.01. Amendment............................................................................171
SECTION 12.02. Recordation of Agreement; Counterparts...............................................173
SECTION 12.03. Governing Law........................................................................173
SECTION 12.04. Intention of Parties.................................................................173
SECTION 12.05. Notices..............................................................................175
SECTION 12.06. Severability of Provisions...........................................................175
SECTION 12.07. Limitation on Rights of Certificateholders...........................................176
SECTION 12.08. Certificates Nonassessable and Fully Paid............................................176
SECTION 12.09. Protection of Assets.................................................................176
SECTION 12.10. Non-Solicitation.....................................................................177
ARTICLE XIII EXCHANGE ACT REPORTING.............................................................................177
SECTION 13.01. Commission Reporting.................................................................177
SECTION 13.02. Form 10-D Reporting..................................................................178
SECTION 13.03. Form 10-K Reporting..................................................................179
SECTION 13.04. Form 8-K Reporting...................................................................180
SECTION 13.05. Delisting; Amendment; Late Filing of Reports.........................................181
SECTION 13.06. Annual Statements of Compliance......................................................181
SECTION 13.07. Annual Assessments of Compliance.....................................................182
SECTION 13.08. Accountant's Attestation.............................................................183
SECTION 13.09. Xxxxxxxx-Xxxxx Certification.........................................................184
SECTION 13.10. Indemnification......................................................................185
EXHIBITS
Exhibit A: Form of Class A Certificate..........................................................A-1
Exhibit B: Form of Class 4-M Certificate........................................................B-1
Exhibit C: Form of Class B Certificate..........................................................C-1
Exhibit D-1: Form of Class AR Certificate.......................................................D-1-1
Exhibit D-2: Form of Class AR-L Certificate.....................................................D-2-1
Exhibit E: Form of Class P Certificate..........................................................E-1
Exhibit F: Form of Class X Certificate..........................................................F-1
Exhibit G: Form of Reverse of Certificates......................................................G-1
Exhibit H-1: Form of Servicer Information.......................................................H-1-1
Exhibit H-2: Reporting Data for Defaulted Loans.................................................H-2-1
Exhibit H-3: Form of Realized Loss Calculation..................................................H-3-1
Exhibit I: Form of Trust Receipt and Initial Certification......................................I-1
Exhibit J: Form of Trust Receipt and Final Certification........................................J-1
Exhibit K: Form of Request for Release..........................................................K-1
Exhibit L: Form of Transferor Certificate.......................................................L-1
Exhibit M-1: Form of Investment Letter..........................................................M-1-1
Exhibit M-2: Form of Rule 144A Letter...........................................................M-2-1
Exhibit M-3: Form of Regulation S Letter........................................................M-3-1
Exhibit N: Form of Transferee Affidavit and Agreement...........................................N-1
Exhibit O: Form of Transfer Certificate.........................................................O-1
Exhibit P: Form of SPS Mortgage Loans Report....................................................P-1
Exhibit Q: Form of SPS Foreclosure Settlement Statement.........................................Q-1
Exhibit R: Relevant Servicing Criteria..........................................................R-1
Exhibit S: Additional Form 10-D Disclosure......................................................S-1
Exhibit T: Form of Monthly Statement to Certificateholders......................................T-1
Exhibit U: Form 8-K Disclosure Information .....................................................U-1
Exhibit V: Form of Back-Up Certification .......................................................V-1
Exhibit W: Additional Disclosure Notification ..................................................W-1
Exhibit X: [Reserved] ..........................................................................X-1
Exhibit Y: Additional Form 10-K Disclosure .....................................................Y-1
Exhibit Z: Form of Certification Regarding Substitution of Defective Mortgage
Loans ..............................................................................Z-1
SCHEDULES
Schedule I: Mortgage Loan Schedule...............................................................I-1
Schedule IIA: Representations and Warranties of Seller - DLJMC...................................IIA-1
Schedule IIB: Representations and Warranties of Master Servicer - Xxxxx Fargo....................IIB-1
Schedule IIC: Representations and Warranties of Servicer and Special Servicer -
SPS................................................................................IIC-1
Schedule IID: Representations and Warranties of Servicer - Xxxxx Fargo...........................IID-1
Schedule IIE: Representations and Warranties of Servicer - GreenPoint............................IIE-1
Schedule III: Representations and Warranties of DLJMC - Mortgage Loans...........................III-1
APPENDICES
Appendix A: Calculation of Class Y Principal Reduction Amounts .........................Appendix A-1
THIS POOLING AND SERVICING AGREEMENT, dated as of July 1, 2006, is hereby executed by
and among CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP., as depositor (the "Depositor"), DLJ
MORTGAGE CAPITAL, INC. ("DLJMC"), as seller (in such capacity, the "Seller"), XXXXX FARGO BANK, N.A., as
master servicer (in such capacity, the "Master Servicer"), as a servicer (in such capacity, a
"Servicer"), and as trust administrator (in such capacity, the "Trust Administrator"), GREENPOINT
MORTGAGE FUNDING, INC. ("GreenPoint"), as servicer (in such capacity, a "Servicer"), SELECT PORTFOLIO
SERVICING, INC. ("SPS"), as a servicer (in such capacity, a "Servicer"), and as special servicer (in
such capacity, the "Special Servicer"), and U.S. BANK NATIONAL ASSOCIATION, as trustee (in such
capacity, the "Trustee"). Capitalized terms used in this Agreement and not otherwise defined shall have
the meanings assigned to them in Article I below.
PRELIMINARY STATEMENT
The Depositor is the owner of the Trust Fund (other than the Trust's rights under the
Group 4 Interest Rate Cap Agreements and rights to payments from the Supplemental Interest Account) that
is hereby conveyed to the Trustee in return for the Certificates. The Trust Fund (exclusive of any
entitlement to Assigned Prepayment Premiums, the Group 4 Interest Rate Cap Agreements, the assets held
in the Group 4 Interest Rate Cap Accounts, and rights to payments from the Supplemental Interest
Account) for federal income tax purposes shall consist of three REMICs (referred to as "REMIC I,"
"REMIC II" and "REMIC III").
REMIC I
As provided herein, the Trust Administrator will make an election to treat the
segregated pool of assets consisting of the Group 1, Group 2 and Group 3 Mortgage Loans and certain
other related assets (exclusive of any entitlement to Assigned Prepayment Premiums) subject to this
Agreement as a real estate mortgage investment conduit (a "REMIC") for federal income tax purposes, and
such segregated pool of assets will be designated as "REMIC I." Component I of the Class AR-L
Certificates will represent the sole Class of "residual interests" in REMIC I for purposes of the REMIC
Provisions (as defined herein) under federal income tax law. The following table irrevocably sets forth
the designation, remittance rate (the "Uncertificated REMIC I Pass-Through Rate") and initial
Uncertificated Principal Balance for each of the "regular interests" in REMIC I (the "REMIC I Regular
Interests") and the Class Principal Balance of Component I of the Class AR-L Certificates. The "latest
possible maturity date" (determined solely for purposes of satisfying Treasury regulation
Section 1.860G-1(a)(4)(iii)) for each REMIC I Regular Interest shall be the Maturity Date. None of the
REMIC I Regular Interests will be certificated.
Class Designation for
each REMIC I Regular Initial Uncertificated
Interest and Uncertificated Principal Balance or
Component I of the Type of REMIC I Class Principal
Class AR-L Certificates Interest Pass-Through Rate Balance Maturity Date*
____________________________________________________________________________________________________________
Class Y-1 Regular Variable(1) $ 72,606.46 August 2036
Class Y-2 Regular Variable(2) $ 12,237.42 August 2036
Class Y-3 Regular Variable(3) $ 30,309.91 August 2036
Class Z-1 Regular Variable(1) $ 222,993,307.12 August 2036
Class Z-2 Regular Variable(2) $ 37,584,306.49 August 2036
Class Z-3 Regular Variable(3) $ 60,589,501.85 August 2036
Component I of the
Class AR-L Residual Variable(1) $ 50.00 August 2036
_____________________
* The Distribution Date in the specified month, which is the month following the month the latest maturing
Mortgage Loan in the related Loan Group matures. For federal income tax purposes, for each Class of REMIC I
Regular Interests, the "latest possible maturity date" shall be the Maturity Date.
(1) Interest distributed to REMIC I Regular Interests Y-1 and Z-1 and Component I of the Class AR-L Certificates
on each Distribution Date will have accrued at the Net WAC Rate for Loan Group 1 applicable for such
Distribution Date on the applicable Uncertificated Principal Balance or Class Principal Balance outstanding
immediately before such Distribution Date.
(2) Interest distributed to REMIC I Regular Interests Y-2 and Z-2 on each Distribution Date will have accrued at
the Net WAC Rate for Loan Group 2 applicable for such Distribution Date on the applicable Uncertificated
Principal Balance outstanding immediately before such Distribution Date.
(3) Interest distributed to REMIC I Regular Interests Y-3 and Z-3 on each Distribution Date will have accrued at
the Net WAC Rate for Loan Group 3 applicable for such Distribution Date on the applicable Uncertificated
Principal Balance outstanding immediately before such Distribution Date.
REMIC II
As provided herein, the Trust Administrator will make an election to treat the segregated pool
of assets consisting of the Group 4 Mortgage Loans and certain other related assets (exclusive of any
entitlement to Assigned Prepayment Premiums, the Group 4 Interest Rate Cap Agreements, the assets held
in the Group 4 Interest Rate Cap Accounts, and rights to payments from the Supplemental Interest
Account) subject to this Agreement as a real estate mortgage investment conduit (a "REMIC") for federal
income tax purposes, and such segregated pool of assets will be designated as "REMIC II." Component II
of the Class AR-L Certificates will represent the sole Class of "residual interests" in REMIC II for
purposes of the REMIC Provisions (as defined herein) under federal income tax law. The following table
irrevocably sets forth the designation, remittance rate (the "Uncertificated REMIC II Pass-Through
Rate") and initial Uncertificated Principal Balance for each of the "regular interests" in REMIC II (the
"REMIC II Regular Interests"). The "latest possible maturity date" (determined solely for purposes of
satisfying Treasury regulation Section 1.860G-1(a)(4)(iii)) for each REMIC II Regular Interest shall be
the Maturity Date. None of the REMIC II Regular Interests will be certificated.
Class Designation for
each REMIC II Regular Initial Uncertificated
Interest and Uncertificated Principal Balance or
Component II of the Type of REMIC II Class Principal
Class AR-L Certificates Interest Pass-Through Rate Balance Maturity Date*
_____________________________________________________________________________________________________________
Class LT1 Regular Variable(1) $ 1,143,631,083.58 August 2036
Class LT2 Regular Variable(1) $ 37,795.21 August 2036
Class LT3 Regular 0.00% $ 76,587.00 August 2036
Class LT4 Regular Variable(2) $ 76,587.00 August 2036
Component II of the
Class AR-L Residual N/A N/A August 2036
________________________
* The Distribution Date in the specified month, which is the month following the month the latest maturing
Mortgage Loan in the related Loan Group matures. For federal income tax purposes, for each Class of
REMIC II Regular Interests, the "latest possible maturity date" shall be the Maturity Date.
(1) Interest distributed to REMIC II Regular Interests LT1 and LT2 on each Distribution Date will have accrued
at the weighted average of the Net Mortgage Rates for the Group 4 Loans as of the second preceding Due Date
on the applicable Uncertificated Principal Balance outstanding immediately before such Distribution Date
(2) Interest distributed to REMIC II Regular Interest LT4 on each Distribution Date will have accrued at twice
the weighted average of the Net Mortgage Rates for the Group 4 Loans as of the second preceding Due Date on
the applicable Uncertificated Principal Balance outstanding immediately before such Distribution Date.
REMIC III
As provided herein, the Trust Administrator will elect to treat the segregated pool of
assets consisting of the REMIC I Regular Interests and REMIC II Regular Interests as a REMIC for federal
income tax purposes, and such segregated pool of assets will be designated as REMIC III. The Class AR
Certificates will represent the sole Class of "residual interests" in REMIC III for purposes of the
REMIC Provisions under federal income tax law. The following table and the footnotes that follow
irrevocably sets forth the designation, Pass-Through Rate, aggregate Initial Class Principal Balance,
and certain other features for each Class of Certificates comprising the interests representing "regular
interests" in REMIC III (the "REMIC III Regular Interests") and the Class AR Certificates. The "latest
possible maturity date" (determined solely for purposes of satisfying Treasury Regulation
Section 1.860G-1(a)(4)(iii)) for each Class of REMIC III Regular Certificates shall be the Maturity Date.
Integral
Class Multiples
Principal Pass-Through Minimum in Excess
Class Balance Rate (per annum) Denomination of Minimum
_____________________________________________________________________________________________________________________
Class 1-A-1 $ 193,532,000.00 Variable(1) $25,000 $1
Class 2-A-1 $ 34,938,000.00 Variable(2) $25,000 $1
Class 2-A-2 $ 1,305,000.00 Variable(2) $25,000 $1
Class 3-A-1 $ 52,593,000.00 Variable(3) $25,000 $1
Class 4-A-1-1 $ 260,000,000.00 Variable(4) $25,000 $1
Class 4-A-1-2 $ 32,500,000.00 Variable(5) $25,000 $1
Class 4-A-2 $ 290,000,000.00 Variable(6) $25,000 $1
Class 4-A-3-1 $ 224,820,000.00 Variable(7) $25,000 $1
Class 4-A-3-2 $ 93,150,000.00 Variable(8) $25,000 $1
Class 4-A-3-3 $ 50,218,000.00 Variable(9) $25,000 $1
Class 4-A-4 $ 105,632,000.00 Variable(10) $25,000 $1
Class C-M-1 $ 27,348,000.00 Variable(11) $25,000 $1
Class 4-M-1 $ 14,870,000.00 Variable(12) $25,000 $1
Class 4-M-2 $ 13,726,000.00 Variable(13) $25,000 $1
Class 4-M-3 $ 8,007,000.00 Variable(14) $25,000 $1
Class 4-M-4 $ 6,291,000.00 Variable(15) $25,000 $1
Class 4-M-5 $ 5,719,000.00 Variable(16) $25,000 $1
Class 4-M-6 $ 5,719,000.00 Variable(17) $25,000 $1
Class 4-M-7 $ 5,719,000.00 Variable(18) $25,000 $1
Class 4-M-8 $ 5,719,000.00 Variable(19) $25,000 $1
Class 4-M-9 $ 5,719,000.00 Variable(20) $25,000 $1
Class C-B-1 $ 4,176,000.00 Variable(21) $25,000 $1
Class C-B-2 $ 2,730,000.00 Variable(21) $25,000 $1
Class C-B-3 $ 1,767,000.00 Variable(21) $25,000 $1
Class C-B-4 $ 1,285,000.00 Variable(21) $25,000 $1
Class C-B-5 $ 963,000.00 Variable(21) $25,000 $1
Class C-B-6 $ 645,219.25 Variable(21) $25,000 $1
Class 4-B-1 $ 5,719,000.00 Variable(22) $25,000 $1
Class 4-X $ 10,294,052.78(23) Variable(24) (25) N/A
Class P-1 (26) N/A (27) N/A
Class P-2 (28) N/A (29) N/A
Class AR $ 50.00 Variable(1) (30) N/A
_______________
* Except for one certificate of the Class C-B-6 Certificates which shall contain any stub piece of
less than $1.
(1) With respect to each Distribution Date, the Pass-Through Rate for the Class 1-A-1 Certificates
shall be a per annum rate equal to the Net WAC Rate for Loan Group 1 for that Distribution Date.
(2) With respect to each Distribution Date, the Pass-Through Rate for the Class 2-A-1 and
Class 2-A-2 Certificates shall be a per annum rate equal to the Net WAC Rate for Loan Group 2
for that Distribution Date.
(3) With respect to each Distribution Date, the Pass-Through Rate for the Class 3-A-1 Certificates
shall be a per annum rate equal to the Net WAC Rate for Loan Group 3 for that Distribution Date.
(4) The Pass-Through Rate for the August 2006 Distribution Date for the Class 4-A-1-1 Certificates
is 5.5800% per annum. After such Distribution Date, the Pass-Through Rate for the
Class 4-A-1-1 Certificates shall be a per annum rate equal to the least of (a) the sum of the
applicable Certificate Index and the applicable Certificate Margin for such Distribution Date,
(b) the Net Funds Cap and (c) 11.00%.
(5) The Pass-Through Rate for the August 2006 Distribution Date for the Class 4-A-1-2 Certificates
is 5.6100% per annum. After such Distribution Date, the Pass-Through Rate for the
Class 4-A-1-2 Certificates shall be a per annum rate equal to the least of (a) the sum of the
applicable Certificate Index and the applicable Certificate Margin for such Distribution Date,
(b) the Net Funds Cap and (c) 11.00%.
(6) The Formula Rate for the August 2006 Distribution Date for the Class 4-A-2 Certificates is
5.5200% per annum. After such Distribution Date, the Formula Rate for the Class 4-A-2
Certificates shall be a per annum rate equal to the sum of the applicable Certificate Index and
the applicable Certificate Margin for such Distribution Date; provided, however, that on any
Distribution Date for which on the related Swap Payment Date a Swap Suspension Event has
occurred and is continuing, the Formula Rate for the Class 4-A-2 Certificates shall be a per
annum rate equal to the lesser of (a) the sum of the applicable Certificate Index and the
applicable Certificate Margin for such Distribution Date and (b) the Net Funds Cap. The
interest rate for the REMIC III Regular Interest evidenced by the Class 4-A-2 Certificates
shall be the lesser of (a) the Formula Rate for the Class 4-A-2 Certificates and (b) the Net
Funds Cap.
(7) The Pass-Through Rate for the August 2006 Distribution Date for the Class 4-A-3-1 Certificates
is 5.4700% per annum. After such Distribution Date, the Pass-Through Rate for the
Class 4-A-3-1 Certificates shall be a per annum rate equal to the least of (a) the sum of the
applicable Certificate Index and the applicable Certificate Margin for such Distribution Date,
(b) the Net Funds Cap and (c) 11.00%.
(8) The Pass-Through Rate for the August 2006 Distribution Date for the Class 4-A-3-2 Certificates
is 5.6000% per annum. After such Distribution Date, the Pass-Through Rate for the
Class 4-A-3-2 Certificates shall be a per annum rate equal to the least of (a) the sum of the
applicable Certificate Index and the applicable Certificate Margin for such Distribution Date,
(b) the Net Funds Cap and (c) 11.00%.
(9) The Pass-Through Rate for the August 2006 Distribution Date for the Class 4-A-3-3 Certificates
is 5.6800% per annum. After such Distribution Date, the Pass-Through Rate for the
Class 4-A-3-3 Certificates shall be a per annum rate equal to the least of (a) the sum of the
applicable Certificate Index and the applicable Certificate Margin for such Distribution Date,
(b) the Net Funds Cap and (c) 11.00%.
(10) The Pass-Through Rate for the August 2006 Distribution Date for the Class 4-A-4 Certificates is
5.6700% per annum. After such Distribution Date, the Pass-Through Rate for the Class 4-A-4
Certificates shall be a per annum rate equal to the least of (a) the sum of the applicable
Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net
Funds Cap and (c) 11.00%.
(11) The Pass-Through Rate for the August 2006 Distribution Date for the Class C-M-1 Certificates is
6.0237% per annum. After the first Distribution Date, the Pass-Through Rate on the Class C-M-1
Certificates shall be a per annum rate equal to the weighted average of the Net WAC Rate for
Loan Group 1 and the Net WAC Rate for Loan Group 3, weighted based on the Class C-M-1 Group 1
Component Balance and Class C-M-1 Group 3 Component Balance, respectively.
(12) The Pass-Through Rate for the August 2006 Distribution Date for the Class 4-M-1 Certificates is
5.6900% per annum. After such Distribution Date, the Pass-Through Rate for the Class 4-M-1
Certificates shall be a per annum rate equal to the least of (a) the sum of the applicable
Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net
Funds Cap and (c) 11.00%.
(13) The Pass-Through Rate for the August 2006 Distribution Date for the Class 4-M-2 Certificates is
5.7200% per annum. After such Distribution Date, the Pass-Through Rate for the Class 4-M-2
Certificates shall be a per annum rate equal to the least of (a) the sum of the applicable
Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net
Funds Cap and (c) 11.00%.
(14) The Pass-Through Rate for the August 2006 Distribution Date for the Class 4-M-3 Certificates is
5.7400% per annum. After such Distribution Date, the Pass-Through Rate for the Class 4-M-3
Certificates shall be a per annum rate equal to the least of (a) the sum of the applicable
Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net
Funds Cap and (c) 11.00%.
(15) The Pass-Through Rate for the August 2006 Distribution Date for the Class 4-M-4 Certificates is
5.8000% per annum. After such Distribution Date, the Pass-Through Rate for the Class 4-M-4
Certificates shall be a per annum rate equal to the least of (a) the sum of the applicable
Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net
Funds Cap and (c) 11.00%.
(16) The Pass-Through Rate for the August 2006 Distribution Date for the Class 4-M-5 Certificates is
5.8500% per annum. After such Distribution Date, the Pass-Through Rate for the Class 4-M-5
Certificates shall be a per annum rate equal to the least of (a) the sum of the applicable
Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net
Funds Cap and (c) 11.00%.
(17) The Pass-Through Rate for the August 2006 Distribution Date for the Class 4-M-6 Certificates is
5.9000% per annum. After such Distribution Date, the Pass-Through Rate for the Class 4-M-6
Certificates shall be a per annum rate equal to the least of (a) the sum of the applicable
Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net
Funds Cap and (c) 11.00%.
(18) The Pass-Through Rate for the August 2006 Distribution Date for the Class 4-M-7 Certificates is
6.4300% per annum. After such Distribution Date, the Pass-Through Rate for the Class 4-M-7
Certificates shall be a per annum rate equal to the least of (a) the sum of the applicable
Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net
Funds Cap and (c) 11.00%.
(19) The Pass-Through Rate for the August 2006 Distribution Date for the Class 4-M-8 Certificates is
6.6000% per annum. After such Distribution Date, the Pass-Through Rate for the Class 4-M-8
Certificates shall be a per annum rate equal to the least of (a) the sum of the applicable
Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net
Funds Cap and (c) 11.00%.
(20) The Pass-Through Rate for the August 2006 Distribution Date for the Class 4-M-9 Certificates is
7.4000% per annum. After such Distribution Date, the Pass-Through Rate for the Class 4-M-9
Certificates shall be a per annum rate equal to the least of (a) the sum of the applicable
Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net
Funds Cap and (c) 11.00%.
(21) With respect to each Distribution Date, the Pass-Through Rate for the Class C-B-1, Class C-B-2,
Class C-B-3, Class C-B-4, Class C-B-5 and Class C-B-6 Certificates shall be a per annum rate
equal to the quotient, expressed as a percentage of (a) the sum of (i) the product of (x) the
Net WAC Rate of Loan Group 1 for that Distribution Date and (y) the Subordinate
Component Balance for Loan Group 1 immediately prior to such Distribution Date, (ii) the product
of (x) the Net WAC Rate of Loan Group 2 for that Distribution Date and (y) the Subordinate
Component Balance for Loan Group 2 immediately prior to such Distribution Date, (iii) the
product of (x) the Net WAC Rate of Loan Group 3 for that Distribution Date and (y) the
Subordinate Component Balance for Loan Group 3 immediately prior to such Distribution Date,
divided by (b) the aggregate of the Subordinate Component Balances for Loan Group 1, Loan
Group 2 and Loan Group 3 immediately prior to such Distribution Date.
(22) The Pass-Through Rate for the August 2006 Distribution Date for the Class 4-B-1 Certificates is
7.4000% per annum. After such Distribution Date, the Pass-Through Rate for the Class 4-B-1
Certificates shall be a per annum rate equal to the least of (a) the sum of the applicable
Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net
Funds Cap and (c) 11.00%.
(23) The Class 4-X Certificates will not accrue interest on their Class Principal Balance. The
Class 4-X Certificates accrue interest on the Class 4-X Notional Amount.
(24) The Class 4-X Certificates will be comprised of two REMIC III Regular Interests, a principal
only regular interest designated 4-X-PO and an interest only regular interest designated
4-X-IO, which will be entitled to distributions as set forth herein. On each Distribution Date,
the Class 4-X Certificates shall be entitled to the Class 4-X Distributable Amount. With
respect to any Distribution Date, interest accrued on the Class 4-X Certificates during the
related Accrual Period shall equal interest at the related Pass-Through Rate on the Class 4-X
Notional Amount immediately prior to such Distribution Date, in each case reduced by any
interest shortfalls with respect to the Mortgage Loans in the related Loan Group including
Prepayment Interest Shortfalls to the extent not covered by Compensating Interest Payments.
The Pass-Through Rate for the Class 4-X Certificates or REMIC III Regular Interest 4-X-IO for
any Distribution Date shall equal a per annum rate equal to the percentage equivalent of a
fraction, the numerator of which is the product of (a) 30 and (b) the sum of the amounts
calculated pursuant to clauses (i) through (iii) below, and the denominator of which is the
product of (a) the actual number of days in the related Accrual Period and (b) the aggregate
Uncertificated Principal Balance of REMIC II Regular Interests LT1, LT2, LT3 and LT4. For
purposes of calculating the Pass-Through Rate for the Class 4-X Certificates, the numerator is
equal to the sum of the following components:
(i) the Uncertificated Pass-Through Rate for REMIC II Regular Interests LT1 minus the
Marker Rate, applied to a notional amount equal to the aggregate Uncertificated
Principal Balance of REMIC II Regular Interest LT1;
(ii) the Uncertificated Pass-Through Rate for REMIC II Regular Interest LT2 minus the
Marker Rate, applied to a notional amount equal to the Uncertificated Principal
Balance of REMIC II Regular Interest LT2; and
(iii) the Uncertificated Pass-Through Rate for REMIC II Regular Interest LT4 minus twice the
Marker Rate, applied to a notional amount equal to the Uncertificated Principal
Balance of REMIC II Regular Interest LT4.
Accrued interest on the Class 4-X Certificates shall accrue on the basis of a 360-day year and
the actual number of days in the related Accrual Period. Payments from the Interest Remittance
Amount or Principal Remittance Amount to any Class of Group 4 Certificates in respect of Basis
Risk Shortfalls or to the Supplemental Interest Trust for payment to the Swap Counterparty
shall be deemed to have first been distributed from REMIC III to the holders of the Class 4-X
Certificates in respect of REMIC III Regular Interest 4-X-IO and then paid by such holders to
such Class of Group 4 Certificates or the Supplemental Interest Trust, as applicable. Any
amounts distributed to the holders of the Class 4-A-2 Certificates by the Trust Administrator
from amounts it receives from the Supplemental Interest Account shall be deemed to have first
been paid outside of any REMIC to the holders of the Class 4-X Certificates in respect of their
rights with respect to the Supplemental Interest Trust and then paid outside of any REMIC by
such holders to holders of the Class 4-A-2 Certificates.
(25) The Class 4-X Certificates will be issued in certificated, fully-registered form in minimum
denominations of 20% of the Percentage Interest therein and increments of 10% in excess thereof.
(26) The Class P-1 Certificates will not have a Class Principal Balance. The Class P-1 Certificates
shall have an initial notional balance of $170,239,268.81 and will be entitled to
distributions of Assigned Prepayment Premiums collected with respect to Loan Group 1, Loan
Group 2, Loan Group 3 and the adjustable-rate mortgage loans in Loan Group 4 only. Such
entitlement shall not be an interest in any REMIC created hereunder.
(27) The Class P-1 Certificates will be issued in certificated, fully-registered form in minimum
denominations of 20% of the Percentage Interest therein and increments of 10% in excess thereof.
(28) The Class P-2 Certificates will not have a Class Principal Balance. The Class P-2 Certificates
shall have an initial notional balance of $73,454,982.36 and will be entitled to distributions
of Assigned Prepayment Premiums collected with respect to the fixed-rate mortgage loans in Loan
Group 4 only. Such entitlement shall not be an interest in any REMIC created hereunder.
(29) The Class P-2 Certificates will be issued in certificated, fully-registered form in minimum
denominations of 20% of the Percentage Interest therein and increments of 10% in excess thereof.
(30) The Class AR Certificates will be issued in minimum Percentage Interests of 20%.
For the avoidance of doubt, the Trust Administrator shall account for any interest
amount due to a Certificateholder in excess of the interest rate on the REMIC Regular Interest issued by
REMIC III evidenced by such Certificate as part of the payment made to the Class 4-X Certificates, to
the extent it is entitled to funds from the REMIC, and then paid outside of the REMIC pursuant to a
separate contractual right to such Certificateholder.
The foregoing REMIC structure is intended to cause all of the cash from the Mortgage
Loans to flow through to REMIC III as cash flow on a REMIC Regular Interest, without creating any
shortfall—actual or potential (other than for credit losses) to any REMIC Regular Interest. To the
extent that the structure is believed to diverge from such intention the Trust Administrator shall
resolve ambiguities to accomplish such result and shall to the extent necessary rectify any drafting
errors or seek clarification to the structure without Certificateholder approval (but with guidance of
counsel) to accomplish such intention.
Set forth below are designations of Classes of Certificates to the categories used
herein:
Book-Entry Certificates............. All Classes of Certificates other than the Physical Certificates.
Class 4-A-1 Certificates............ The Class 4-A-1-1 and Class 4-A-1-2 Certificates.
Class 4-A-3 Certificates............ The Class 4-A-3-1, Class 4-A-3-2 and Class 4-A-3-3 Certificates.
Class 4-M Certificates.............. The Class 4-M-1, Class 4-M-2, Class 4-M-3, Class 4-M-4, Class 4-M-5,
Class 4-M-6, Class 4-M-7, Class 4-M-8 and Class 4-M-9 Certificates.
Class A Certificates................ The Group 1, Group 2 and Group 3 Certificates and the Group 4 Senior
Certificates.
Class C-B Certificates.............. The Class C-B-1, Class C-B-2, Class C-B-3, Class C-B-4, Class C-B-5 and
Class C-B-6 Certificates.
Class P Certificates................ The Class P-1 and Class P-2 Certificates.
ERISA-Restricted Certificates....... Residual Certificates and Private Certificates; and any Certificates that
do not satisfy the applicable ratings requirement under the Underwriter's
Exemption.
Group 1 Certificates................ The Class 1-A-1 and Residual Certificates.
Group 2 Certificates................ The Class 2-A-1 and Class 2-A-2 Certificates.
Group 3 Certificates................ The Class 3-A-1 Certificates.
Group 4 Certificates................ The Group 4 Senior Certificates, Class 4-X Certificates and Class 4-M
Certificates.
Group 4 Senior Certificates......... The Class 4-A-1, Class 4-A-2, Class 4-A-3 and Class 4-A-4 Certificates.
Group 4 Subordinate Certificates.... The Class 4-M Certificates, Class 4-B-1 Certificates and Class 4-X
Certificates.
LIBOR Certificates.................. The Group 4 Senior Certificates, Class 4-M Certificates and Class 4-B-1
Certificates.
Notional Amount Certificates........ The Class 4-X Certificates.
Offered Certificates................ All Classes of Certificates other than the Private Certificates.
Private Certificates................ The Class C-B-4 Class C-B-5, Class C-B-6, Class 4-X and Class P
Certificates.
Physical Certificates............... The Residual Certificates and the Private Certificates.
Rating Agencies..................... Xxxxx'x and S&P.
Regular Certificates................ All Classes of Certificates other than the Residual Certificates.
Residual Certificates............... The Class AR and Class AR-L Certificates.
Senior Certificates................. The Class A Certificates and the Class C-M-1 Certificates.
Subordinate Certificates............ The Class 4-M, Class C-B, Class 4-B-1 and Class 4-X Certificates.
All covenants and agreements made by the Depositor herein are for the benefit and
security of the Certificateholders. The Depositor is entering into this Agreement, and the Trustee is
accepting the trusts created hereby and thereby, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged.
The parties hereto intend to effect an absolute sale and assignment of the Mortgage
Loans to the Trustee for the benefit of Certificateholders under this Agreement. However, the Depositor
and the Seller shall hereunder absolutely assign and, as a precautionary matter grant a security
interest, in and to its rights, if any, in the related Mortgage Loans to the Trustee on behalf of
Certificateholders to ensure that the interest of the Certificateholders hereunder in the Mortgage Loans
is fully protected.
W I T N E S S E T H T H A T:
In consideration of the mutual agreements herein contained, the Depositor, the Seller,
the Master Servicer, the Servicers, the Special Servicer, the Trustee and the Trust Administrator agree
as follows:
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and phrases, unless the context
otherwise requires, shall have the following meanings:
1933 Act: The Securities Act of 1933, as amended.
Accepted Servicing Practices: With respect to any Mortgage Loan, those mortgage
servicing practices of prudent mortgage lending institutions which service mortgage loans of the same
type as such Mortgage Loan in the jurisdiction where the related Mortgaged Property is located.
Accountant's Attestation: The attestation required from an Accountant pursuant to
Section 13.08.
Accrual Period: For any interest bearing Class of Certificates, other than the LIBOR
Certificates, and any Distribution Date, the calendar month immediately preceding such Distribution Date
and with respect to the LIBOR Certificates, the period beginning on the immediately preceding
Distribution Date (or the Closing Date, in the case of the first Accrual Period) and ending on the day
immediately preceding such Distribution Date.
Additional Data Remittance Date: With respect to any Distribution Date and the Master
Servicer, GreenPoint or SPS, no later than twelve noon, five Business Days before the related
Distribution Date and with respect to any Distribution Date and Xxxxx Fargo, no later than the close of
business, five Business Days before the related Distribution Date.
Additional Disclosure Notification: As defined in Section 13.02.
Additional Form 10-D Disclosure: As defined in Section 13.02.
Additional Form 10-K Disclosure: As defined in Section 13.03.
Additional Servicer: Each affiliate of each Servicer that Services any of the
Mortgage Loans and each Person who is not an affiliate of any Servicer, who Services 10% or more of the
Mortgage Loans (measured by aggregate Stated Principal Balance of the Mortgage Loans, annually at the
commencement of the calendar year prior to the year in which an Item 1123 Certificate is required to the
delivered). For clarification purposes, the Master Servicer and the Trust Administrator are Additional
Servicers.
Adjustment Date: With respect to each Mortgage Loan, each adjustment date on which
the Mortgage Rate thereon changes pursuant to the related Mortgage Note. The first Adjustment Date
following the Cut-off Date as to each such Mortgage Loan is set forth in the Mortgage Loan Schedule.
Advance: With respect to any Non-Designated Mortgage Loan and any Distribution Date,
any payment required to be made by a Servicer or the Master Servicer, as applicable, with respect to
such Distribution Date pursuant to Section 5.01.
With respect to any Countrywide Serviced Mortgage Loan and any Distribution Date, the
payment required to be made by (i) Countrywide with respect to the Remittance Date (as defined in the
Countrywide Underlying Servicing Agreement) in the month of such Distribution Date pursuant to
Subsection 11.19 of Exhibit 9 of the Countrywide Underlying Servicing Agreement or (ii) the Master
Servicer with respect to such Distribution Date pursuant to Section 3.20(b) of this Agreement.
With respect to any Hemisphere Serviced Mortgage Loan and any Distribution Date, the
payment required to be made by (i) Hemisphere with respect to the Remittance Date (as defined in the
Hemisphere Underlying Servicing Agreement) in the month of such Distribution Date pursuant to
Section 5.03 of the Hemisphere Underlying Servicing Agreement or (ii) the Master Servicer with respect to
such Distribution Date pursuant to Section 3.20(b) of this Agreement.
With respect to any CitiMortgage Serviced Mortgage Loan and any Distribution Date, the
payment required to be made by (i) CitiMortgage with respect to the Remittance Date (as defined in the
CitiMortgage Underlying Servicing Agreement) in the month of such Distribution Date pursuant to Section
O of Exhibit M to the CitiMortgage Underlying Servicing Agreement or (ii) the Master Servicer with
respect to such Distribution Date pursuant to Section 3.20(b) of this Agreement.
With respect to any BofA Serviced Mortgage Loan and any Distribution Date, the payment
required to be made by (i) BofA with respect to the Remittance Date (as defined in the BofA Underlying
Servicing Agreement) in the month of such Distribution Date pursuant to Subsection 10.17 of the BofA
Underlying Servicing Agreement or (ii) the Master Servicer with respect to such Distribution Date
pursuant to Section 3.20(b) of this Agreement.
Adverse REMIC Event: As defined in Section 2.07(f).
Aggregate Groups 1-3 Collateral Balance: With respect to any date of determination,
will be equal to the sum of the Aggregate Loan Group Balances for Loan Group 1, Loan Group 2 and Loan
Group 3 as of such date of determination.
Aggregate Loan Group Balance: With respect to any Loan Group and as of any date of
determination, will be equal to the aggregate Stated Principal Balance of the Mortgage Loans in such
Loan Group as of the first day of the month of such date of determination.
Agreement: This Pooling and Servicing Agreement and all amendments or supplements
hereto.
Ancillary Income: All income derived from the Non-Designated Mortgage Loans, other
than Servicing Fees and Master Servicing Fees, including but not limited to, late charges, fees received
with respect to checks or bank drafts returned by the related bank for non-sufficient funds, assumption
fees, optional insurance administrative fees and all other incidental fees and charges. Ancillary
Income does not include any Assigned Prepayment Premiums.
Applied Loss Amount: With respect to any Distribution Date, with respect to the
Group 4 Certificates, the excess, if any, of (i) the aggregate Class Principal Balances of the Group 4
Certificates (other than the related Notional Amount Certificates), after giving effect to all Realized
Losses with respect to the Mortgage Loans in Loan Group 4 during the Collection Period for such
Distribution Date and payments of principal on such Distribution Date over (ii) the Aggregate Loan Group
Balance for Loan Group 4 for such Distribution Date.
Appraised Value: The appraised value of the Mortgaged Property based upon the
appraisal made for the originator at the time of the origination of the related Mortgage Loan or the
sales price of the Mortgaged Property at the time of such origination, whichever is less, or (i) with
respect to any Mortgage Loan that represents a refinancing other than a Streamlined Mortgage Loan, the
lower of the appraised value at origination or the appraised value of the Mortgaged Property based upon
the appraisal made at the time of such refinancing and (ii) with respect to any Streamlined Mortgage
Loan, the appraised value of the Mortgaged Property based upon the appraisal made in connection with the
origination of the mortgage loan being refinanced.
Assigned Prepayment Premium: Any Prepayment Premium on a Xxxxx Fargo Serviced
Mortgage Loan, any Prepayment Premium on a SPS Serviced Mortgage Loan, any Prepayment Premium on a
GreenPoint Serviced Mortgage Loan and any other Prepayment Premium on deposit in the Certificate Account.
Assignment and Assumption Agreement: That certain assignment and assumption agreement
dated as of July 1, 2006, by and between DLJ Mortgage Capital, Inc., as assignor, and the Depositor, as
assignee, relating to the Mortgage Loans.
Assignment of Proprietary Lease: With respect to a Cooperative Loan, the assignment
or mortgage of the related Proprietary Lease from the Mortgagor to the originator of the Cooperative
Loan.
Available Distribution Amount: With respect to any Distribution Date and each of
Group 1, Group 2 and Group 3 the sum of:
(i) all amounts in respect of Scheduled Payments (net of the related Expense Fees) due on the
related Due Date and received prior to the related Determination Date on the related Mortgage
Loans, together with any Advances in respect thereof;
(ii) all Insurance Proceeds (to the extent not applied to the restoration of the Mortgaged Property
or released to the Mortgagor in accordance with the applicable Servicer's Accepted Servicing
Standards), all Liquidation Proceeds received during the calendar month preceding the month of
that Distribution Date on the related Mortgage Loans, in each case net of unreimbursed
Liquidation Expenses incurred with respect to such Mortgage Loans;
(iii) all Principal Prepayments received during the related Prepayment Period on the related Mortgage
Loans, excluding Prepayment Premiums;
(iv) amounts received with respect to such Distribution Date as the Substitution Adjustment Amount
or Purchase Price in respect of a Mortgage Loan in the related Loan Group repurchased by the
Seller, purchased by a Holder of a Subordinate Certificate pursuant to Section 3.11(f) or
purchased by the Special Servicer pursuant to Section 3.11(g) as of such Distribution Date;
(v) any amounts payable as Compensating Interest Payments by a Servicer with respect to the related
Mortgage Loans on such Distribution Date;
(vi) all Recoveries, if any; and
(vii) the portion of the Mortgage Loan Purchase Price related to such Loan Group paid in connection
with an Optional Termination up to the amount of the Par Value for such Loan Group;
in the case of clauses (i) through (iv) above reduced by amounts in reimbursement for Advances
previously made and other amounts as to which the Trustee, the Trust Administrator, a Servicer or the
Master Servicer is entitled to be reimbursed pursuant to Section 3.08 in respect of the related Mortgage
Loans or otherwise.
Bankruptcy Code: The United States Bankruptcy Code, as amended from time to time (11
U.S.C. §§ 101 et seq.).
Bankruptcy Coverage Termination Date: The point in time at which the Bankruptcy Loss
Coverage Amount has been reduced to zero.
Bankruptcy Loss: With respect to any Loan Group, Realized Losses on the Mortgage
Loans in that Loan Group incurred as a result of a Deficient Valuation or Debt Service Reduction.
Bankruptcy Loss Coverage Amount: As of any Determination Date, the Bankruptcy Loss
Coverage Amount shall equal the Initial Bankruptcy Loss Coverage Amount as reduced by (i) the aggregate
amount of Bankruptcy Losses allocated to the Class C-B Certificates since the Cut-off Date and (ii) any
permissible reductions in the Bankruptcy Loss Coverage Amount as evidenced by a letter of each Rating
Agency to the Trust Administrator to the effect that any such reduction will not result in a
downgrading, or otherwise adversely affect, of the then current ratings assigned to such Classes of
Certificates rated by it.
Basis Risk Shortfall: For any Class of LIBOR Certificates (other than the Class 4-A-2
Certificates if no Swap Suspension Event has occurred and is continuing) and any Distribution Date, the
sum of (i) the excess, if any, of (a) the related Current Interest calculated on the basis of the least
of (x) the applicable Certificate Index plus the applicable Certificate Margin, (y) the Maximum Interest
Rate and (z) 11.00% over (b) the related Current Interest for the applicable Distribution Date, (ii) any
amount described in clause (i) remaining unpaid from prior Distribution Dates, and (iii) interest on the
amount in clause (ii) for the related Accrual Period calculated at a per annum rate equal to the least
of (x) the applicable Certificate Index plus the applicable Certificate Margin, (y) the applicable
Maximum Interest Rate and (z) 11.00%. For the Class 4-A-2 Certificates and any Distribution Date on
which on the related Swap Payment Date a Swap Suspension Event has occurred and is continuing, the sum
of (i) the excess, if any, of (a) the related Current Interest calculated on the basis of the lesser of
(x) the applicable Certificate Index plus the applicable Certificate Margin and (y) the Maximum Interest
Rate over (b) the related Current Interest for the applicable Distribution Date, (ii) any amount
described in clause (i) remaining unpaid from prior Distribution Dates, and (iii) interest on the amount
in clause (ii) for the related Accrual Period calculated at a per annum rate equal to the least of
(x) the applicable Certificate Index plus the applicable Certificate Margin and (y) the applicable
Maximum Interest Rate.
Beneficial Holder: A Person holding a beneficial interest in any Certificate through
a Participant or an Indirect Participant or a Person holding a beneficial interest in any Definitive
Certificate.
BofA: Bank of America, N.A., and its successors and assigns.
BofA Serviced Mortgage Loans: The Mortgage Loans identified as such on the Mortgage
Loan Schedule, for which BofA is the applicable Servicer.
BofA Reconstituted Servicing Agreement: That certain Reconstituted Servicing
Agreement dated as of July 1, 2006 among DLJMC, BofA, the Master Servicer and the Trust Administrator,
and acknowledged by the Trustee.
BofA Underlying Servicing Agreement: The "Servicing Agreement" referred to in the
BofA Reconstituted Servicing Agreement.
Book-Entry Certificates: As set forth in the Preliminary Statement.
Book-Entry Form: Any Certificate held through the facilities of the Depository.
Business Day: Any day other than (i) a Saturday or a Sunday or (ii) a day on which
banking institutions in New York or the state in which the office of the Master Servicer or any Servicer
or the Corporate Trust Office of the Trustee or Trust Administrator are located are authorized or
obligated by law or executive order to be closed.
Capitalization Reimbursement Amount: For any Distribution Date, the aggregate of the
amounts added to the Stated Principal Balances of the Mortgage Loans during the preceding calendar month
representing reimbursements to a Servicer on or prior to such Distribution Date in connection with the
modification of such Mortgage Loan pursuant to Section 3.05.
Carryforward Interest: For any Class of LIBOR Certificates and any Distribution Date,
the sum of (1) the amount, if any, by which (x) the sum of (A) Current Interest for such Class for the
immediately preceding Distribution Date and (B) any unpaid Carryforward Interest for such Class from
previous Distribution Dates exceeds (y) the amount paid in respect of interest on such Class on such
immediately preceding Distribution Date, and (2) interest on such amount for the related Accrual Period
at the applicable Pass-Through Rate.
Cash Remittance Date: With respect to any Distribution Date and (A) SPS or
GreenPoint, the 7th calendar day preceding such Distribution Date, or if such 7th calendar day is not a
Business Day, the Business Day immediately preceding such 7th calendar day and (B) Xxxxx Fargo and the
Designated Servicers, the 18th calendar day of the month in which the Distribution Date occurs, or if
such 18th calendar day is not a Business Day, the Business Day immediately following such 18th calendar
day.
Certificate: Any Certificates executed and authenticated by the Trust Administrator
on behalf of the Trustee for the benefit of the Certificateholders in substantially the form or forms
attached as Exhibits A through G hereto.
Certificate Account: The separate Eligible Account created and maintained with the
Trust Administrator, or any other bank or trust company acceptable to the Rating Agencies which is
incorporated under the laws of the United States or any state thereof pursuant to Section 3.05, which
account shall bear a designation clearly indicating that the funds deposited therein are held in trust
for the benefit of the Trust Administrator, as agent for the Trustee, on behalf of the
Certificateholders or any other account serving a similar function acceptable to the Rating Agencies.
Funds in the Certificate Account may (i) be held uninvested without liability for interest or
compensation thereon or (ii) be invested at the direction of the Trust Administrator in Eligible
Investments and reinvestment earnings thereon (net of investment losses) shall be paid to the Trust
Administrator. Funds deposited in the Certificate Account (exclusive of the amounts permitted to be
withdrawn pursuant to Section 3.08(b)) shall be held in trust for the Certificateholders.
Certificate Balance: With respect to any Certificate at any date, the maximum dollar
amount of principal to which the Holder thereof is then entitled hereunder, such amount being equal to
the Denomination thereof (i) minus all distributions of principal and allocations of Realized Losses,
including Excess Losses or Applied Loss Amounts, as applicable, previously made or allocated with
respect thereto and, in the case of the Class 4-A-2 Certificates and any Subordinate Certificates,
reduced by any such amounts allocated to such Class on prior Distribution Dates pursuant to Section 4.02
and (ii) plus the amount of any increase to the Certificate Balance of such Certificate pursuant to
Section 4.03.
With respect to each Class 4-X Certificate, on any date of determination, an amount
equal to the Percentage Interest evidenced by such Certificate multiplied by an amount equal to (i) the
excess, if any, of (A) the Aggregate Loan Group Balance for Loan Group 4 as of such date of
determination, over (B) the then aggregate Class Principal Balance of the Group 4 Senior Certificates,
Class 4-M Certificates and Class 4-B-1 Certificates then outstanding, which represents the sum of
(i) the initial principal balance of REMIC III Regular Interest 4-X-PO, as reduced by Realized Losses
allocated thereto and payments deemed made thereon, and (ii) accrued and unpaid interest on REMIC III
Regular Interest 4-X-IO, as reduced by Realized Losses allocated thereto.
Certificate Group: Any of Certificate Group 1, Certificate Group 2, Certificate
Group 3 or Certificate Group 4, as applicable.
Certificate Group 1: Any of the Certificates with a Class designation beginning with
"1" and the Class C-M-1 Certificates, each of which relates to Loan Group 1.
Certificate Group 2: Any of the Certificates with a Class designation beginning with
"2" and relating to Loan Group 2.
Certificate Group 3: Any of the Certificates with a Class designation beginning with
"3" and the Class C-M-1 Certificates, each of which relates to Loan Group 3.
Certificate Group 4: Any of the Certificates with a Class designation beginning with
"4" and relating to Loan Group 4.
Certificateholder or Holder: The Person in whose name a Certificate is registered in
the Certificate Register.
Certificate Index: With respect to each Distribution Date and the LIBOR Certificates,
the rate for one month United States dollar deposits quoted on Telerate Page 3750 as of 11:00 a.m.,
London time, on the related Interest Determination Date relating to each Class of LIBOR Certificates.
If such rate does not appear on such page (or such other page as may replace that page on that service,
or if such service is no longer offered, such other service for displaying one month LIBOR or comparable
rates as may be reasonably selected by the Trust Administrator after consultation with DLJMC), the rate
will be the related Reference Bank Rate. If no such quotations can be obtained and no related Reference
Bank Rate is available, the Certificate Index with respect to the LIBOR Certificates will be the
Certificate Index applicable to such Certificates on the preceding Distribution Date.
On the Interest Determination Date immediately preceding each Distribution Date, the
Trust Administrator shall determine each Certificate Index for the Accrual Period commencing on such
Distribution Date and inform the Master Servicer of such rate.
Certificate Margin: As to each Class of LIBOR Certificates, the applicable amount set
forth below:
Certificate Margin
_______________________________________________________________________________________
Class (1) (2)
_______________________________________________________________________________________
4-A-1-1 0.180% 0.360%
4-A-1-2 0.210% 0.420%
4-A-2 0.120% 0.240%
4-A-3-1 0.070% 0.140%
4-A-3-2 0.200% 0.400%
4-A-3-3 0.280% 0.560%
4-A-4 0.270% 0.540%
4-M-1 0.290% 0.580%
4-M-2 0.320% 0.640%
4-M-3 0.340% 0.680%
4-M-4 0.400% 0.800%
4-M-5 0.450% 0.900%
4-M-6 0.500% 1.000%
4-M-7 1.030% 1.530%
4-M-8 1.200% 1.700%
4-M-9 2.000% 2.500%
___________
(1) On and prior to the first Distribution Date on which the Optional
Termination for Loan Group 4 may occur.
(2) After the first Distribution Date on which the Optional Termination for
Loan Group 4 may occur.
Certificate Register: The register maintained pursuant to Section 6.02(a) hereof.
Certification Parties: As defined in Section 13.09.
Certification Person: As defined in Section 13.09.
CitiMortgage: CitiMortgage, Inc., and its successors and assigns.
CitiMortgage Serviced Mortgage Loans: The Mortgage Loans identified as such on the
Mortgage Loan Schedule, for which CitiMortgage is the applicable Servicer.
CitiMortgage Reconstituted Servicing Agreement: That certain Reconstituted Servicing
Agreement dated as of July 1, 2006 among DLJMC, CitiMortgage, the Master Servicer and the Trust
Administrator, and acknowledged by the Trustee.
CitiMortgage Underlying Servicing Agreement: The "Servicing Agreement" referred to in
the CitiMortgage Reconstituted Servicing Agreement.
Class: All Certificates bearing the same class designation as set forth in the
Preliminary Statement.
Class 4-A-1-2 Adjusted Class Principal Balance: For any Distribution Date, the Class
Principal Balance of the Class 4-A-1-2 Certificates immediately prior to such Distribution Date, reduced
by the Class 4-A-1-2 Undercollateralization Amount, if any, for such Distribution Date.
Class 4-A-1-2 Undercollateralization Amount: For any Distribution Date on or after
which the aggregate Class Principal Balance of the Class 4-A-4 Certificates, the Class 4-M Certificates
and the Class 4-B-1 Certificates has been reduced to zero, an amount equal to the product of (a) the
excess of (i) the aggregate Class Principal Balance of the Group 4 Senior Certificates immediately prior
to such Distribution Date over (ii) the Aggregate Loan Group Balance for Loan Group 4 as of such
Distribution Date and (b) a fraction, the numerator of which is equal to the aggregate Class Principal
Balance of the Class 4-A-1-1 and Class 4-A-1-2 Certificates immediately prior to such Distribution Date
and the denominator of which is equal to the aggregate Class Principal Balance of the Group 4
Certificates immediately prior to such Distribution Date.
Class 4-A-1/4-A-3/4-A-4 Interest Rate Cap Account: The separate Eligible Account
created and initially maintained by the Trust Administrator pursuant to Section 4.08 in the name of the
Trust Administrator on behalf of the Trustee and for the benefit of the Class 4-X Certificateholders,
designated "Xxxxx Fargo Bank, N.A. in trust for registered holders of Adjustable Rate Mortgage Trust
2006-3, Adjustable Rate Mortgage-Backed Pass-Through Certificates, Series 2006-3, Group 4 Certificates"
Funds in the Class 4-A-1/4-A-3/4-A-4 Interest Rate Cap Account shall be held in trust for the
Certificateholders for the uses and purposes set forth in this Agreement. The Class 4-A-1/4-A-3/4-A-4
Interest Rate Cap Account will not be an asset of any REMIC. Ownership of the Class 4-A-1/4-A-3/4-A-4
Interest Rate Cap Account is evidenced by the Class 4-X Certificates.
Class 4-A-1/4-A-3/4-A-4 Interest Rate Cap Agreement: The interest rate cap agreement
relating to the Class 4-A-1-1, Class 4-A-1-2, Class 4-A-3-1, Class 4-A-3-2, Class 4-A-3-3 and
Class 4-A-4 Certificates consisting of the ISDA Master Agreement, the Schedule, the Credit Support Annex
and the Confirmation related thereto, each dated as of the Closing Date, between the Trust Administrator
on behalf of the Trust and the Group 4 Interest Rate Cap Counterparty, as such agreement may be amended
and supplemented in accordance with its terms and any replacement Class 4-A-1/4-A-3/4-A-4 Interest Rate
Cap Agreement acceptable to the Depositor and the Trust Administrator.
Class 4-A-2 Interest Rate Cap Account: The separate Eligible Account created and
initially maintained by the Trust Administrator pursuant to Section 4.08 in the name of the Trust
Administrator on behalf of the Trustee and for the benefit of the Class 4-X Certificateholders,
designated "Xxxxx Fargo Bank, N.A. in trust for registered holders of Adjustable Rate Mortgage Trust
2006-3, Adjustable Rate Mortgage-Backed Pass-Through Certificates, Series 2006-3, Group 4 Certificates"
Funds in the Class 4-A-2 Interest Rate Cap Account shall be held in trust for the Certificateholders for
the uses and purposes set forth in this Agreement. The Class 4-A-2 Interest Rate Cap Account will not
be an asset of any REMIC. Ownership of the Class 4-A-2 Interest Rate Cap Account is evidenced by the
Class 4-X Certificates.
Class 4-A-2 Interest Rate Cap Agreement: The interest rate cap agreement relating to
the Class 4-A-2 Certificates consisting of the ISDA Master Agreement, the Schedule, the Credit Support
Annex and the Confirmation related thereto, each dated as of the Closing Date, between the Trust
Administrator on behalf of the Trust and the Group 4 Interest Rate Cap Counterparty, as such agreement
may be amended and supplemented in accordance with its terms and any replacement Class 4-A-2 Interest
Rate Cap Agreement acceptable to the Depositor and the Trust Administrator.
Class 4-M/4-B Interest Rate Cap Account: The separate Eligible Account created and
initially maintained by the Trust Administrator pursuant to Section 4.08 in the name of the Trust
Administrator on behalf of the Trustee and for the benefit of the Class 4-X Certificateholders,
designated "Xxxxx Fargo Bank, N.A. in trust for registered holders of Adjustable Rate Mortgage Trust
2006-3, Adjustable Rate Mortgage-Backed Pass-Through Certificates, Series 2006-3, Group 4 Certificates"
Funds in the Class 4-M/4-B Interest Rate Cap Account shall be held in trust for the Certificateholders
for the uses and purposes set forth in this Agreement. The Class 4-M/4-B Interest Rate Cap Account will
not be an asset of any REMIC. Ownership of the Class 4-M/4-B Interest Rate Cap Account is evidenced by
the Class 4-X Certificates.
Class 4-M/4-B Interest Rate Cap Agreement: The interest rate cap agreement relating
to the Class 4-M Certificates and Class 4-B-1 Certificates consisting of the ISDA Master Agreement, the
Schedule, the Credit Support Annex and the Confirmation related thereto, each dated as of the Closing
Date, between the Trust Administrator on behalf of the Trust and the Group 4 Interest Rate Cap
Counterparty, as such agreement may be amended and supplemented in accordance with its terms and any
replacement Class 4-M/4-B Interest Rate Cap Agreement acceptable to the Depositor and the Trust
Administrator.
Class 4-B-1 Principal Payment Amount: For any Distribution Date on or after the
Stepdown Date and as long as a Trigger Event has not occurred with respect to such Distribution Date,
will be the amount, if any, by which (x) the sum of (i) the aggregate Class Principal Balance of the
Group 4 Senior Certificates and the Class 4-M Certificates, after giving effect to payments on such
Distribution Date and (ii) the Class Principal Balance of the Class 4-B-1 Certificates immediately prior
to such Distribution Date exceeds (y) the lesser of (A) the product of (i) 96.90% and (ii) the Aggregate
Loan Group Balance for Loan Group 4 for such Distribution Date and (B) the amount, if any, by which
(i) the Aggregate Loan Group Balance for Loan Group 4 for such Distribution Date exceeds (ii) 0.50% of
the Aggregate Loan Group Balance for Loan Group 4 as of the Cut-off Date.
Class 4-M-1 Principal Payment Amount: For any Distribution Date on or after the
Stepdown Date and as long as a Trigger Event has not occurred with respect to such Distribution Date,
will be the amount, if any, by which (x) the sum of (i) the aggregate Class Principal Balance of the
Group 4 Senior Certificates, after giving effect to payments on such Distribution Date and (ii) the
Class Principal Balance of the Class 4-M-1 Certificates immediately prior to such Distribution Date
exceeds (y) the lesser of (A) the product of (i) 86.00% and (ii) the Aggregate Loan Group Balance for
Loan Group 4 for such Distribution Date and (B) the amount, if any, by which (i) the Aggregate Loan
Group Balance for Loan Group 4 for such Distribution Date exceeds (ii) 0.50% of the Aggregate Loan Group
Balance for Loan Group 4 as of the Cut-off Date.
Class 4-M-2 Principal Payment Amount: For any Distribution Date on or after the
Stepdown Date and as long as a Trigger Event has not occurred with respect to such Distribution Date,
will be the amount, if any, by which (x) the sum of (i) the aggregate Class Principal Balance of the
Group 4 Senior Certificates and Class 4-M-1 Certificates, in each case, after giving effect to payments
on such Distribution Date and (ii) the Class Principal Balance of the Class 4-M-2 Certificates
immediately prior to such Distribution Date exceeds (y) the lesser of (A) the product of (i) 88.40% and
(ii) the Aggregate Loan Group Balance for Loan Group 4 for such Distribution Date and (B) the amount, if
any, by which (i) the Aggregate Loan Group Balance for Loan Group 4 for such Distribution Date exceeds
(ii) 0.50% of the Aggregate Loan Group Balance for Loan Group 4 as of the Cut-off Date.
Class 4-M-3 Principal Payment Amount: For any Distribution Date on or after the
Stepdown Date and as long as a Trigger Event has not occurred with respect to such Distribution Date,
will be the amount, if any, by which (x) the sum of (i) the aggregate Class Principal Balance of the
Group 4 Senior Certificates, Class 4-M-1 and Class 4-M-2 Certificates, in each case, after giving effect
to payments on such Distribution Date and (ii) the Class Principal Balance of the Class 4-M-3
Certificates immediately prior to such Distribution Date exceeds (y) the lesser of (A) the product of
(i) 89.80% and (ii) the Aggregate Loan Group Balance for Loan Group 4 for such Distribution Date and (B)
the amount, if any, by which (i) the Aggregate Loan Group Balance for Loan Group 4 for such Distribution
Date exceeds (ii) 0.50% of the Aggregate Loan Group Balance for Loan Group 4 as of the Cut-off Date.
Class 4-M-4 Principal Payment Amount: For any Distribution Date on or after the
Stepdown Date and as long as a Trigger Event has not occurred with respect to such Distribution Date,
will be the amount, if any, by which (x) the sum of (i) the aggregate Class Principal Balance of the
Group 4 Senior Certificates, Class 4-M-1, Class 4-M-2 and Class 4-M-3 Certificates, in each case, after
giving effect to payments on such Distribution Date and (ii) the Class Principal Balance of the
Class 4-M-4 Certificates immediately prior to such Distribution Date exceeds (y) the lesser of (A) the
product of (i) 90.90% and (ii) the Aggregate Loan Group Balance for Loan Group 4 for such Distribution
Date and (B) the amount, if any, by which (i) the Aggregate Loan Group Balance for Loan Group 4 for such
Distribution Date exceeds (ii) 0.50% of the Aggregate Loan Group Balance for Loan Group 4 as of the
Cut-off Date.
Class 4-M-5 Principal Payment Amount: For any Distribution Date on or after the
Stepdown Date and as long as a Trigger Event has not occurred with respect to such Distribution Date,
will be the amount, if any, by which (x) the sum of (i) the aggregate Class Principal Balance of the
Group 4 Senior Certificates, Class 4-M-1, Class 4-M-2, Class 4-M-3 and Class 4-M-4 Certificates, in each
case, after giving effect to payments on such Distribution Date and (ii) the Class Principal Balance of
the Class 4-M-5 Certificates immediately prior to such Distribution Date exceeds (y) the lesser of
(A) the product of (i) 91.90% and (ii) the Aggregate Loan Group Balance for Loan Group 4 for such
Distribution Date and (B) the amount, if any, by which (i) the Aggregate Loan Group Balance for Loan
Group 4 for such Distribution Date exceeds (ii) 0.50% of the Aggregate Loan Group Balance for Loan
Group 4 as of the Cut-off Date.
Class 4-M-6 Principal Payment Amount: For any Distribution Date on or after the
Stepdown Date and as long as a Trigger Event has not occurred with respect to such Distribution Date,
will be the amount, if any, by which (x) the sum of (i) the aggregate Class Principal Balance of the
Group 4 Senior Certificates, Class 4-M-1, Class 4-M-2, Class 4-M-3, Class 4-M-4 and Class 4-M-5
Certificates, in each case, after giving effect to payments on such Distribution Date and (ii) the Class
Principal Balance of the Class 4-M-6 Certificates immediately prior to such Distribution Date exceeds
(y) the lesser of (A) the product of (i) 92.90% and (ii) the Aggregate Loan Group Balance for Loan
Group 4 for such Distribution Date and (B) the amount, if any, by which (i) the Aggregate Loan Group
Balance for Loan Group 4 for such Distribution Date exceeds (ii) 0.50% of the Aggregate Loan Group
Balance for Loan Group 4 as of the Cut-off Date.
Class 4-M-7 Principal Payment Amount: For any Distribution Date on or after the
Stepdown Date and as long as a Trigger Event has not occurred with respect to such Distribution Date,
will be the amount, if any, by which (x) the sum of (i) the aggregate Class Principal Balance of the
Group 4 Senior Certificates, Class 4-M-1, Class 4-M-2, Class 4-M-3, Class 4-M-4, Class 4-M-5 and
Class 4-M-6 Certificates, in each case, after giving effect to payments on such Distribution Date and
(ii) the Class Principal Balance of the Class 4-M-7 Certificates immediately prior to such Distribution
Date exceeds (y) the lesser of (A) the product of (i) 93.90% and (ii) the Aggregate Loan Group Balance
for Loan Group 4 for such Distribution Date and (B) the amount, if any, by which (i) the Aggregate Loan
Group Balance for Loan Group 4 for such Distribution Date exceeds (ii) 0.50% of the Aggregate Loan Group
Balance for Loan Group 4 as of the Cut-off Date.
Class 4-M-8 Principal Payment Amount: For any Distribution Date on or after the
Stepdown Date and as long as a Trigger Event has not occurred with respect to such Distribution Date,
will be the amount, if any, by which (x) the sum of (i) the aggregate Class Principal Balance of the
Group 4 Senior Certificates, Class 4-M-1, Class 4-M-2, Class 4-M-3, Class 4-M-4, Class 4-M-5,
Class 4-M-6 and Class 4-M-7 Certificates, in each case, after giving effect to payments on such
Distribution Date and (ii) the Class Principal Balance of the Class 4-M-8 Certificates immediately prior
to such Distribution Date exceeds (y) the lesser of (A) the product of (i) 94.90% and (ii) the Aggregate
Loan Group Balance for Loan Group 4 for such Distribution Date and (B) the amount, if any, by which
(i) the Aggregate Loan Group Balance for Loan Group 4 for such Distribution Date exceeds (ii) 0.50% of
the Aggregate Loan Group Balance for Loan Group 4 as of the Cut-off Date.
Class 4-M-9 Principal Payment Amount: For any Distribution Date on or after the
Stepdown Date and as long as a Trigger Event has not occurred with respect to such Distribution Date,
will be the amount, if any, by which (x) the sum of (i) the aggregate Class Principal Balance of the
Group 4 Senior Certificates, Class 4-M-1, Class 4-M-2, Class 4-M-3, Class 4-M-4, Class 4-M-5,
Class 4-M-6, Class 4-M-7 and Class 4-M-8 Certificates, in each case, after giving effect to payments on
such Distribution Date and (ii) the Class Principal Balance of the Class 4-M-9 Certificates immediately
prior to such Distribution Date exceeds (y) the lesser of (A) the product of (i) 95.90% and (ii) the
Aggregate Loan Group Balance for Loan Group 4 for such Distribution Date and (B) the amount, if any, by
which (i) the Aggregate Loan Group Balance for Loan Group 4 for such Distribution Date exceeds
(ii) 0.50% of the Aggregate Loan Group Balance for Loan Group 4 as of the Cut-off Date.
Class 4-M Certificates: The Class 4-M-1, Class 4-M-2, Class 4-M-3, Class 4-M-4,
Class 4-M-5, Class 4-M-6, Class 4-M-7, Class 4-M-8 and Class 4-M-9 Certificates.
Class 4-X Distributable Amount: With respect to any Distribution Date and the
Class 4-X Certificates, to the extent of any Monthly Excess Cashflow remaining on such Distribution Date
after the distribution of amounts pursuant to Section 4.01(II)(d)(i)-(xi), the sum of (a) the amount of
interest accrued during the related Accrual Period on the Class 4-X Certificates (as described in the
Preliminary Statement) and (b) the Overcollateralization Release Amount, if any, for such Distribution
Date.
Class 4-X Notional Amount: With respect to the Class 4-X Certificates or REMIC III
Regular Interest 4-X-IO and any Distribution Date, the aggregate of the Uncertificated Principal
Balances of the REMIC II Regular Interests LT1, LT2, LT3 and LT4 immediately prior to such Distribution
Date, (which for clarification is equal to the Aggregate Loan Group Balance for Loan Group 4 as of the
first day of the related Collection Period (excluding any such Mortgage Loans that were subject to a
Payoff, the principal of which was distributed on the Distribution Date preceding the current
Distribution Date)).
Class A Certificates: As set forth in the Preliminary Statement.
Class C-B Certificates: As set forth in the Preliminary Statement.
Class C-B Credit Support Depletion Date: The first Distribution Date on which the
aggregate Class Principal Balance of the Class C-B Certificates has been or will be reduced to zero.
Class C-B Percentage: With respect to any Distribution Date, the aggregate Class
Principal Balance of the Class C-B Certificates immediately prior to such Distribution Date divided by
the Aggregate Groups 1-3 Collateral Balance as of the first day of the related Collection Period
(excluding any such Mortgage Loans that were subject to a Payoff, the principal of which was distributed
on the Distribution Date preceding the current Distribution Date).
Class C-M-1 Group 1 Component Balance: For any Distribution Date and with respect to
Loan Group 1, the portion of the Class Principal Balance of the Class C-M-1 Certificates that relates to
such Loan Group, which will initially be an amount equal to $21,504,000 and will be reduced on each
Distribution Date by the aggregate of the following amounts allocable to the Class C-M-1 Certificates:
o All amounts previously distributed to the Holders of the Class C-M-1 Certificates as payments
of principal from Loan Group 1; and
o The amount of Realized Losses, including Excess Losses, allocated to the Class C-M-1
Certificates in respect of Loan Group 1.
Class C-M-1 Group 3 Component Balance: For any Distribution Date and with respect to
Loan Group 3, the portion of the Class Principal Balance of the Class C-M-1 Certificates that relates to
such Loan Group, which will initially be an amount equal to $5,844,000 and will be reduced on each
Distribution Date by the aggregate of the following amounts allocable to the Class C-M-1 Certificates:
o All amounts previously distributed to the holders of the Class C-M-1 Certificates as payments
of principal from Loan Group 3; and
o The amount of Realized Losses, including Excess Losses, allocated to the Class C-M-1
Certificates in respect of Loan Group 3.
Class Interest Shortfall: With respect to any Distribution Date and Class of Group 1,
Group 2, Group 3 and Class C-B Certificates, the amount by which the amount described in clause (i) of
the definition of Interest Distribution Amount for such Class, exceeds the amount of interest actually
distributed on such Class on such Distribution Date.
Class Notional Amount: The Class 4-X Notional Amount.
Class Principal 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 Unpaid Interest Amounts: With respect to any Distribution Date and Class of
interest bearing Group 1, Group 2, Group 3 and Class C-B Certificates, the amount by which the aggregate
Class Interest Shortfalls for such Class on prior Distribution Dates exceeds the amount distributed on
such Class on prior Distribution Dates pursuant to clause (ii) of the definition of Interest
Distribution Amount.
Class Y Principal Reduction Amounts: For any Distribution Date, the amounts by which
the Uncertificated Principal Balances of the Class Y Regular Interests will be reduced on such
Distribution Date by the allocation of Realized Losses and the distribution of principal, determined as
described in Appendix A.
Class Y Regular Interests: The Class Y-1, Class Y-2, Class Y-3, Class Y-4 and
Class Y-5 Regular Interests.
Class Y-1 Principal Distribution Amount: For any Distribution Date, the excess, if
any, of the Class Y-1 Principal Reduction Amount for such Distribution Date over the principal portion
of Realized Losses allocated to the Class Y-1 Regular Interest on such Distribution Date.
Class Y-1 Principal Reduction Amount: The Class Y Principal Reduction Amount for the
Class Y-1 Regular Interest as determined pursuant to the provisions of the Appendix A.
Class Y-1 Regular Interest: The uncertificated undivided beneficial interest in
REMIC I which constitutes a REMIC I Regular Interest and is entitled to distributions as set forth herein.
Class Y-2 Principal Distribution Amount: For any Distribution Date, the excess, if
any, of the Class Y-2 Principal Reduction Amount for such Distribution Date over the principal portion
of Realized Losses allocated to the Class Y-2 Regular Interest on such Distribution Date.
Class Y-2 Principal Reduction Amount: The Class Y Principal Reduction Amount for the
Class Y-2 Regular Interest as determined pursuant to the provisions of the Appendix A.
Class Y-2 Regular Interest: The uncertificated undivided beneficial interest in
REMIC I which constitutes a REMIC I Regular Interest and is entitled to distributions as set forth herein.
Class Y-3 Principal Distribution Amount: For any Distribution Date, the excess, if
any, of the Class Y-3 Principal Reduction Amount for such Distribution Date over the principal portion
of Realized Losses allocated to the Class Y-3 Regular Interest on such Distribution Date.
Class Y-3 Principal Reduction Amount: The Class Y Principal Reduction Amount for the
Class Y-3 Regular Interest as determined pursuant to the provisions of the Appendix A.
Class Y-3 Regular Interest: The uncertificated undivided beneficial interest in
REMIC I which constitutes a REMIC I Regular Interest and is entitled to distributions as set forth herein.
Class Y-4 Principal Distribution Amount: For any Distribution Date, the excess, if
any, of the Class Y-4 Principal Reduction Amount for such Distribution Date over the principal portion
of Realized Losses allocated to the Class Y-4 Regular Interest on such Distribution Date.
Class Y-4 Principal Reduction Amount: The Class Y Principal Reduction Amount for the
Class Y-4 Regular Interest as determined pursuant to the provisions of the Appendix A.
Class Y-4 Regular Interest: The uncertificated undivided beneficial interest in
REMIC I which constitutes a REMIC I Regular Interest and is entitled to distributions as set forth herein.
Class Y-5 Principal Distribution Amount: For any Distribution Date, the excess, if
any, of the Class Y-5 Principal Reduction Amount for such Distribution Date over the principal portion
of Realized Losses allocated to the Class Y-5 Regular Interest on such Distribution Date.
Class Y-5 Principal Reduction Amount: The Class Y Principal Reduction Amount for the
Class Y-5 Regular Interest as determined pursuant to the provisions of the Appendix A.
Class Y-5 Regular Interest: The uncertificated undivided beneficial interest in
REMIC I which constitutes a REMIC I Regular Interest and is entitled to distributions as set forth herein.
Class Z Principal Reduction Amounts: For any Distribution Date, the amounts by which
the Uncertificated Principal Balances of the Class Z Regular Interests will be reduced on such
Distribution Date by the allocation of Realized Losses and the distribution of principal, which shall be
in each case the excess of (A) the sum of (x) the excess of the REMIC I Available Distribution Amount
for the related Group (i.e. the "related Group" for the Class Z-1 Regular Interest is the Group 1 Loans,
the "related Group" for the Class Z-2 Regular Interest is the Group 2 Loans, the "related Group" for the
Class Z-3 Regular Interest is the Group 3 Loans) exclusive of any Recoveries included therein over the
amounts thereof distributable (i) in respect of interest on such Class Z Regular Interest and the
related Class Y Regular Interest and (ii) in the case of the Group 1 Loans, to the Class AR-L
Certificates in respect of Component I thereof and (y) the amount of Realized Losses allocable to
principal for the related Group over (B) the Class Y Principal Reduction Amount for the related Group.
Class Z Regular Interests: The Class Z-1, Class Z-2 and Class Z-3 Regular Interests.
Class Z-1 Principal Distribution Amount: For any Distribution Date, the excess, if
any, of the Class Z-1 Principal Reduction Amount for such Distribution Date over the principal portion
of Realized Losses allocated to the Class Z-1 Regular Interest on such Distribution Date.
Class Z-1 Principal Reduction Amount: The Class Z Principal Reduction Amount for the
Class Z-1 Regular Interest as determined pursuant to the provisions of the Appendix A.
Class Z-1 Regular Interest: The uncertificated undivided beneficial interest in
REMIC I which constitutes a REMIC I Regular Interest and is entitled to distributions as set forth herein.
Class Z-2 Principal Distribution Amount: For any Distribution Date, the excess, if
any, of the Class Z-2 Principal Reduction Amount for such Distribution Date over the principal portion
of Realized Losses allocated to the Class Z-2 Regular Interest on such Distribution Date.
Class Z-2 Principal Reduction Amount: The Class Z Principal Reduction Amount for the
Class Z-2 Regular Interest as determined pursuant to the provisions of the Appendix A.
Class Z-2 Regular Interest: The uncertificated undivided beneficial interest in
REMIC I which constitutes a REMIC I Regular Interest and is entitled to distributions as set forth herein.
Class Z-3 Principal Distribution Amount: For any Distribution Date, the excess, if
any, of the Class Z-3 Principal Reduction Amount for such Distribution Date over the principal portion
of Realized Losses allocated to the Class Z-3 Regular Interest on such Distribution Date .
Class Z-3 Principal Reduction Amount: The Class Z Principal Reduction Amount for the
Class Z-3 Regular Interest as determined pursuant to the provisions of the Appendix A.
Class Z-3 Regular Interest: The uncertificated undivided beneficial interest in
REMIC I which constitutes a REMIC I Regular Interest and is entitled to distributions as set forth herein.
Clearing Agency: An organization registered as a "clearing agency" pursuant to
Section 17A of the Securities Exchange Act of 1934, as amended, which initially shall be DTC, the nominee
of which is Cede & Co., as the registered Holder of the Book Entry Certificates. The Clearing Agency
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.
Closing Date: July 31, 2006.
Code: The Internal Revenue Code of 1986, as amended.
Collection Account: The accounts established and maintained by a Servicer in
accordance with Section 3.05.
Collection Period: With respect to each Distribution Date, the period commencing on
the second day of the month preceding the month of the Distribution Date and ending on the first day of
the month of the Distribution Date.
Commencement of Foreclosure: The first official action required under local law to
commence foreclosure proceedings or to schedule a trustee's sale under a deed of trust, including:
(i) in the case of a mortgage, any filing or service of process necessary to commence an action to
foreclose; or (ii) in the case of a deed of trust, the posting, publishing, filing or delivery of a
notice of sale.
Commission: The U.S. Securities and Exchange Commission.
Compensating Interest Payment: For any Distribution Date and the SPS Serviced
Mortgage Loans, the lesser of (i) the aggregate Servicing Fee payable to SPS in respect of the SPS
Serviced Mortgage Loans for such Distribution Date and (ii) the aggregate Prepayment Interest Shortfall
allocable to Payoffs and Curtailments with respect to the SPS Serviced Mortgage Loans.
For any Distribution Date and the GreenPoint Serviced Mortgage Loans, the lesser of
(i) the aggregate Servicing Fee payable to GreenPoint in respect of the GreenPoint Serviced Mortgage
Loans for such Distribution Date, and (ii) the aggregate Prepayment Interest Shortfall allocable to
Payoffs and Curtailments with respect to the GreenPoint Serviced Mortgage Loans.
For any Distribution Date and the Xxxxx Fargo Serviced Mortgage Loans, the lesser of
(i) the aggregate Servicing Fee payable to Xxxxx Fargo in respect of the Xxxxx Fargo Serviced Mortgage
Loans for such Distribution Date and (ii) the aggregate Prepayment Interest Shortfall allocable to
Payoffs and Curtailments with respect to the Xxxxx Fargo Serviced Mortgage Loans.
For any Distribution Date and the Master Servicer, the Compensating Interest Payment
shall be equal to:
(a) with respect to the SPS Serviced Mortgage Loans, the excess of (i) the Compensating Interest
Payment required to be remitted by SPS for such Distribution Date over (ii) the Compensating
Interest Payment actually remitted by SPS for such Distribution Date;
(b) with respect to the Xxxxx Fargo Serviced Mortgage Loans, the excess of (i) the Compensating
Interest Payment required to be remitted by Xxxxx Fargo for such Distribution Date over
(ii) the Compensating Interest Payment actually remitted by Xxxxx Fargo for such Distribution
Date;
(c) with respect to the GreenPoint Serviced Mortgage Loans, the excess of (i) the Compensating
Interest Payment required to be remitted by GreenPoint for such Distribution Date over (ii) the
amount of the Compensating Interest Payment actually remitted by GreenPoint for such
Distribution Date;
(d) with respect to the Countrywide Serviced Mortgage Loans, the excess of (i) the Prepayment
Interest Shortfall Amount (as defined in the Countrywide Servicing Agreement) required to be
remitted by Countrywide on the Remittance Date (as defined in the Countrywide Servicing
Agreement) in the month of such Distribution Date over (ii) the amount of Prepayment Interest
Shortfall Amount (as defined in the Countrywide Servicing Agreement) actually remitted by
Countrywide on the Remittance Date (as defined in the Countrywide Servicing Agreement) in the
month of such Distribution Date;
(e) with respect to the Hemisphere Serviced Mortgage Loans, the excess of (i) the Compensating
Interest (as defined in the Hemisphere Underlying Servicing Agreement) required to be remitted
by Hemisphere on the Remittance Date (as defined in the Hemisphere Underlying Servicing
Agreement) relating to such Distribution Date over (ii) the Compensating Interest (as defined
in the Hemisphere Underlying Servicing Agreement) actually remitted by Hemisphere on the
Remittance Date (as defined in the Hemisphere Underlying Servicing Agreement) relating to such
Distribution Date;
(f) with respect to the CitiMortgage Serviced Mortgage Loans, the excess of (i) the amounts paid in
respect of Prepayment Interest Shortfalls (as defined in the CitiMortgage Underlying Servicing
Agreement) required to be remitted by CitiMortgage on the Remittance Date (as defined in the
CitiMortgage Underlying Servicing Agreement) relating to such Distribution Date over
(ii) amounts paid in respect of Prepayment Interest Shortfalls (as defined in the CitiMortgage
Underlying Servicing Agreement) actually remitted by CitiMortgage on the Remittance Date (as
defined in the CitiMortgage Underlying Servicing Agreement) relating to such Distribution Date;
and
(g) with respect to the BofA Serviced Mortgage Loans, the excess of (i) the amounts required to be
remitted by BofA pursuant to Subsection 10.04(i) of the BofA Underlying Servicing Agreement on
the Remittance Date (as defined in the BofA Underlying Servicing Agreement) relating to such
Distribution Date over (ii) the amounts actually remitted by BofA pursuant to
Subsection 10.04(i) of the BofA Underlying Servicing Agreement on the Remittance Date (as
defined in the BofA Underlying Servicing Agreement) relating to such Distribution Date.
Controlling Person: With respect to any Person, any other Person who "controls" such
Person within the meaning of the Securities Act.
Cooperative Corporation: With respect to any Cooperative Loan, the cooperative
apartment corporation that holds legal title to the related Cooperative Property and grants occupancy
rights to units therein to stockholders through Proprietary Leases or similar arrangements.
Cooperative Lien Search: A search for (a) federal tax liens, mechanics' liens, lis
pendens, judgments of record or otherwise against (i) the Cooperative Corporation and (ii) the seller of
the Cooperative Unit, (b) filings of Financing Statements and (c) the deed of the Cooperative Property
into the Cooperative Corporation.
Cooperative Loan: A Mortgage Loan that is secured by a first lien on and a perfected
security interest in Cooperative Shares and the related Proprietary Lease granting exclusive rights to
occupy the related Cooperative Unit in the building owned by the related Cooperative Corporation.
Cooperative Property: With respect to any Cooperative Loan, all real property and
improvements thereto and rights therein and thereto owned by a Cooperative Corporation including without
limitation the land, separate dwelling units and all common elements.
Cooperative Shares: With respect to any Cooperative Loan, the shares of stock issued
by a Cooperative Corporation and allocated to a Cooperative Unit and represented by stock certificates.
Cooperative Unit: With respect to any Cooperative Loan, a specific unit in a
Cooperative Property.
Corporate Trust Office: With respect to the Trustee, the designated office of the
Trustee 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 00
Xxxxxxxxxx Xxxxxx, Xx. Xxxx, Xxxxxxxxx 00000, Attention: Corporate Trust—Structured Finance. With
respect to the Trust Administrator, the designated office of the Trust Administrator 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 0000 Xxx Xxxxxxxxx Xxxx, Xxxxxxxx,
XX 00000, Attention: CSFB ARMT 2006-3, except for purposes of Section 6.06 and certificate transfer
purposes, such term shall mean the office or agency of the Trust Administrator located at Xxxxx Fargo
Bank, N.A., 6th Street and Marquette Avenue, Minneapolis, Minnesota 55479, Attention: CSFB ARMT 2006-3.
Countrywide: Countrywide Home Loans Servicing LP, and its successors and assigns.
Countrywide Serviced Mortgage Loans: The Mortgage Loans identified as such on the
Mortgage Loan Schedule, for which Countrywide is the applicable Designated Servicer.
Countrywide Reconstituted Servicing Agreement: That certain Reconstituted Servicing
Agreement dated as of July 1, 2006 among DLJMC, Countrywide and the Master Servicer, and acknowledged by
the Trustee and the Trust Administrator.
Countrywide Underlying Servicing Agreement: The "Servicing Agreement" referred to in
the Countrywide Reconstituted Servicing Agreement.
Current Interest: For any Class of Group 4 Certificates, other than the Class 4-X
Certificates, and Distribution Date, the amount of interest accruing at the applicable Pass-Through Rate
(or, in the case of the Class 4-A-2 Certificates, the Formula Rate) on the related Class Principal
Balance of such Class during the related Accrual Period; provided, that as to each Class of Group 4
Certificates the Current Interest shall be reduced by a pro rata portion of any Interest Shortfalls to
the extent not covered by Monthly Excess Interest; provided, further, that as to the Class 4-A-2
Certificates and on any Distribution Date, the Current Interest shall be reduced by the amount of any
Net Swap Payments owed by the Swap Counterparty and received by the Trust Administrator from the
Supplemental Interest Account on the related Swap Payment Date and paid pursuant to the first sentence
of Section 4.09(f) hereof.
Curtailment: Any payment of principal on a Mortgage Loan, made by or on behalf of the
related Mortgagor, other than a Scheduled Payment, a prepaid Scheduled Payment or a Payoff, which is
applied to reduce the outstanding Stated Principal Balance of the Mortgage Loan.
Custodial Agreement: An agreement, dated as of the date hereof, among a custodian,
the Trustee and the Trust Administrator, pursuant to which such custodian agrees to hold any of the
documents or instruments referred to in Section 2.01 of this Agreement as agent for the Trustee. As of
the date hereof, the Custodians shall act pursuant to the LaSalle Custodial Agreement and the Xxxxx
Fargo Custodial Agreement, as applicable.
Custodian: A custodian which is appointed pursuant to a Custodial Agreement. Any
Custodian so appointed shall act as agent on behalf of the Trustee, and shall be compensated by the
Trust Administrator or as otherwise specified therein. Initially, LaSalle shall serve as Custodian for
the Mortgage Loans described in the LaSalle Custodial Agreement and Xxxxx Fargo shall serve as Custodian
for the Mortgage Loans described in the Xxxxx Fargo Custodial Agreement.
Cut-off Date: July 1, 2006.
Cut-off Date Principal Balance: With respect to any Mortgage Loan, the Stated
Principal Balance thereof as of the close of business on the Cut-off Date.
Data Remittance Date: With respect to any Distribution Date and each Servicer, the
10th calendar day of the month in which such Distribution Date occurs, or if such 10th day is not a
Business Day, the Business Day immediately following such 10th day .
Debt Service Reduction: With respect to a Mortgage Loan in Loan Group 1, Loan Group 2
or Loan Group 3, 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.
Debt Service Reduction Mortgage Loan: Any Mortgage Loan that became the subject of a
Debt Service Reduction.
Deficient Valuation: With respect to any Mortgage Loan in Loan Group 1, Loan Group 2
or Loan Group 3, 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 that results in a permanent
forgiveness of principal, which valuation in either case results from a proceeding under the Bankruptcy
Code.
Deferred Amount: For any Class of Group 4 Subordinate Certificates (other than the
Class 4-X Certificates) and Class 4-A-4 Certificates and Distribution Date, will equal the amount by
which (x) the aggregate of the Applied Loss Amounts previously applied in reduction of the Class
Principal Balance thereof exceeds (y) the sum of (i) the aggregate of amounts previously paid in
reimbursement thereof and (ii) amounts added to the Class Principal Balances thereof pursuant to
Section 4.03(a)(ii) on all prior Distribution Dates, including such Distribution Date.
Definitive Certificate: As defined in Section 6.07.
Deleted Mortgage Loan: As defined in Section 2.03.
Delinquency Rate: With respect to any Distribution Date, the fraction, expressed as a
percentage, the numerator of which is the aggregate outstanding principal balance of all Mortgage Loans
in Loan Group 4 60 or more days delinquent (including all foreclosures and REO Properties) as of the
close of business on the last day of such month, and the denominator of which is the Aggregate Loan
Group Balance for Loan Group 4 as of the close of business on the last day of such month.
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.
Deposit Amount: As defined in Section 4.08(e) or Section 4.09(e) herein, as
applicable.
Depositor: Credit Suisse First Boston Mortgage Securities Corp., a Delaware
corporation, or its successor in interest.
Depository Agreement: The Letter of Representation dated as of the Closing Date by
and among DTC, the Depositor and the Trust Administrator for the benefit of the Trustee.
Designated Mortgage Loans: The Countrywide Serviced Mortgage Loans, unless any such
Mortgage Loan is no longer serviced by Countrywide under the Countrywide Servicing Agreement, the
Hemisphere Serviced Mortgage Loans, unless any such Mortgage Loan is no longer serviced by Hemisphere
under the Hemisphere Servicing Agreement, the CitiMortgage Serviced Mortgage Loans, unless any such
Mortgage Loan is no longer serviced by CitiMortgage under the CitiMortgage Servicing Agreement and the
BofA Serviced Mortgage Loans, unless any such Mortgage Loan is no longer serviced by BofA under the BofA
Servicing Agreement.
Designated Servicer: Each of Countrywide, Hemisphere, CitiMortgage and BofA.
Designated Servicing Agreement: The Countrywide Reconstituted Servicing Agreement,
the Hemisphere Reconstituted Servicing Agreement, the CitiMortgage Reconstituted Servicing Agreement and
the BofA Reconstituted Servicing Agreement.
Determination Date: With respect to each Distribution Date and (i) each Servicer
(other than Xxxxx Fargo), the 10th day of the calendar month in which such Distribution Date occurs or,
if such 10th day is not a Business Day, the Business Day immediately succeeding such Business Day and
(ii) Xxxxx Fargo, the Business Day immediately preceding the related Cash Remittance Date.
Disqualified Organization: Any organization defined as a "disqualified organization"
under Section 860E(e)(5) of the Code, which includes any of the following: (i) the United States, any
State or political subdivision thereof, any possession of the United States, or any agency or
instrumentality of any of the foregoing (other than an instrumentality which is a corporation if all of
its activities are subject to tax and, except for the FHLMC, a majority of its board of directors is not
selected by such governmental unit), (ii) a foreign government, any international organization, or any
agency or instrumentality of any of the foregoing, (iii) any organization (other than certain farmers'
cooperatives described in Section 521 of the Code) which is exempt from the tax imposed by Chapter 1 of
the Code (including the tax imposed by Section 511 of the Code on unrelated business taxable income),
(iv) rural electric and telephone cooperatives described in Section 1381(a)(2)(C) of the Code, (v) an
"electing large partnership" within the meaning of Section 775 of the Code, and (vi) any other Person so
designated by the Trust Administrator based upon an Opinion of Counsel that the holding of an Ownership
Interest in a Residual Certificate by such Person may cause the REMIC or any Person having an Ownership
Interest in any Class of Certificates (other than such Person) to incur a liability for any federal tax
imposed under the Code that would not otherwise be imposed but for the Transfer of an Ownership Interest
in a Residual Certificate to such Person. The terms "United States," "State" and "international
organization" shall have the meanings set forth in Section 7701 of the Code or successor provisions.
Distribution Date: The 25th day of any month, or if such 25th day is not a Business
Day, the Business Day immediately following such 25th day, commencing in August 2006.
DLJMC: DLJ Mortgage Capital, Inc., a Delaware corporation, and its successors and
assigns.
DTC: The Depository Trust Company.
Due Date: With respect to each Mortgage Loan and any Distribution Date, the date on
which Scheduled Payments on such Mortgage Loan are due which is either the first day of the month of
such Distribution Date, or if Scheduled Payments on such Mortgage Loan are due on a day other than the
first day of the month, the date in the calendar month immediately preceding the Distribution Date on
which such Scheduled Payments are due, exclusive of any days of grace.
Eligible Account: Either (i) an account or accounts maintained with a federal or
state chartered depository institution or trust company acceptable to the Rating Agencies or (ii) an
account or accounts the deposits in which are insured by the FDIC to the limits established by such
corporation, provided that any such deposits not so insured shall be maintained in an account at a
depository institution or trust company whose commercial paper or other short term debt obligations (or,
in the case of a depository institution or trust company which is the principal subsidiary of a holding
company, the commercial paper or other short term debt obligations of such holding company) have been
rated by each Rating Agency in its highest short term rating category, or (iii) a segregated trust
account or accounts (which shall be a "special deposit account") maintained with the Trustee, the Trust
Administrator or any other federal or state chartered depository institution or trust company, acting in
its fiduciary capacity, in a manner acceptable to the Trustee, the Trust Administrator and the Rating
Agencies. Eligible Accounts may bear interest.
Eligible Institution: An institution having the highest short term debt rating, and
one of the two highest long term debt ratings of the Rating Agencies or the approval of the Rating
Agencies.
Eligible Investments: Any one or more of the obligations and securities listed below:
1. direct obligations of, and obligations fully guaranteed by, the United States of America, or
any agency or instrumentality of the United States of America the obligations of which are
backed by the full faith and credit of the United States of America; or obligations fully
guaranteed by, the United States of America; the FHLMC, FNMA, the Federal Home Loan Banks or
any agency or instrumentality of the United States of America rated AA (or the equivalent) or
higher by the Rating Agencies;
2. federal funds, demand and time deposits in, certificates of deposits of, or bankers'
acceptances issued by, any depository institution or trust company incorporated or organized
under the laws of the United States of America or any state thereof and subject to supervision
and examination by federal and/or state banking authorities, so long as at the time of such
investment or contractual commitment providing for such investment the commercial paper or
other short term debt obligations of such depository institution or trust company (or, in the
case of a depository institution or trust company which is the principal subsidiary of a
holding company, the commercial paper or other short term debt obligations of such holding
company) are rated in one of two of the highest ratings by each of the Rating Agencies, and the
long term debt obligations of such depository institution or trust company (or, in the case of
a depository institution or trust company which is the principal subsidiary of a holding
company, the long term debt obligations of such holding company) are rated in one of two of the
highest ratings, by each of the Rating Agencies;
3. repurchase obligations with a term not to exceed 30 days with respect to any security described
in clause (i) above and entered into with a depository institution or trust company (acting as
a principal) in the highest rated category by the Rating Agencies; provided, however, that
collateral transferred pursuant to such repurchase obligation must be of the type described in
clause (i) above and must (A) be valued daily at current market price plus accrued interest,
(B) pursuant to such valuation, be equal, at all times, to 105% of the cash transferred by the
Trustee or the Trust Administrator in exchange for such collateral, and (C) be delivered to the
Trustee or the Trust Administrator or, if the Trustee or the Trust Administrator, as
applicable, is supplying the collateral, an agent for the Trustee or the Trust Administrator,
in such a manner as to accomplish perfection of a security interest in the collateral by
possession of certificated securities;
4. securities bearing interest or sold at a discount issued by any corporation incorporated under
the laws of the United States of America or any state thereof which has a long term unsecured
debt rating in the highest available rating category of each of the Rating Agencies at the time
of such investment;
5. commercial paper having an original maturity of less than 365 days and issued by an institution
having a short term unsecured debt rating in the highest available rating category of each of
the Rating Agencies that rates such securities, at the time of such investment;
6. a guaranteed investment contract approved by each of the Rating Agencies and issued by an
insurance company or other corporation having a long term unsecured debt rating in the highest
available rating category of each of the Rating Agencies at the time of such investment;
7. money market funds (which may be 12b-1 funds as contemplated under the rules promulgated by the
Securities and Exchange Commission under the Investment Company Act of 1940) having ratings in
the highest available rating category of Xxxxx'x and rated "AAAm" or "AAAm-G" by S&P at the
time of such investment (any such money market funds which provide for demand withdrawals being
conclusively deemed to satisfy any maturity requirements for Eligible Investments set forth
herein) including money market funds of the Master Servicer, a Servicer, the Trustee or the
Trust Administrator and any such funds that are managed by the Master Servicer, a Servicer, the
Trustee or the Trust Administrator or their respective Affiliates or for the Master Servicer, a
Servicer, the Trustee or the Trust Administrator or any Affiliate of such Person acts as
advisor, as long as such money market funds satisfy the criteria of this subparagraph 7; and
8. such other investments the investment in which will not, as evidenced by a letter from each of
the Rating Agencies, result in the downgrading or withdrawal of the Ratings of the Certificates;
provided, however, that no such instrument shall be an Eligible Investment if such instrument
evidences either (i) a right to receive only interest payments with respect to the obligations
underlying such instrument, or (ii) both principal and interest payments derived from
obligations underlying such instrument and the principal and interest payments with respect to
such instrument provide a yield to maturity of greater than 120% of the yield to maturity at
par of such underlying obligations.
ERISA: The Employee Retirement Income Security Act of 1974, as amended.
XXXXX-Xxxxxxxxxx Underwriting: A best efforts or firm commitment underwriting or
private placement that meets the requirements (without regard to the ratings requirements) of an
Underwriter's Exemption.
ERISA Restricted Certificate: As set forth in the Preliminary Statement.
Escrow Account: The separate account or accounts created and maintained by a Servicer
pursuant to Section 3.06.
Escrow Payments: With respect to any Mortgage Loan, the amounts constituting ground
rents, taxes, mortgage insurance premiums, fire and hazard insurance premiums, and any other payments
required to be escrowed by the Mortgagor with the mortgagee pursuant to the Mortgage, applicable law or
any other related document.
Event of Default: As defined in Section 8.01 hereof.
Excess Loss: The amount of any (i) Fraud Loss in excess of the Fraud Loss Coverage
Amount on a Mortgage Loan in Loan Group 1, Loan Group 2 or Loan Group 3 realized after the Fraud Loss
Coverage Termination Date, (ii) Special Hazard Loss in excess of the Special Hazard Loss Coverage Amount
on a Mortgage Loan in Loan Group 1, Loan Group 2 or Loan Group 3 realized after the Special Hazard
Coverage Termination Date or (iii) Bankruptcy Loss in excess of the Bankruptcy Loss Coverage Amount on a
Mortgage Loan in Loan Group 1, Loan Group 2 or Loan Group 3 realized after the Bankruptcy Coverage
Termination Date.
Exchange Act: The Securities Exchange Act of 1934, as amended, and the rules and
regulations thereunder.
Expense Fee Rate: As to each Mortgage Loan, the sum of the related Servicing Fee
Rate, the Trust Administrator Fee Rate, if applicable, and the rate at which the premium on a Lender
Paid Mortgage Guaranty Insurance Policy is calculated, if applicable.
Expense Fees: As to each Mortgage Loan and Distribution Date, the sum of the related
Servicing Fee, the Trust Administrator Fee, if applicable, and any premium on any Lender Paid Mortgage
Guaranty Insurance Policy, if applicable.
FDIC: The Federal Deposit Insurance Corporation, or any successor thereto.
Federal Funds Rate: The interest rate at which depository institutions lend balances
at the Federal Reserve to the depository institutions overnight.
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.
Financing Statement: A financing statement, as applicable, filed pursuant to the
Uniform Commercial Code to perfect a security interest in the Cooperative Shares and Pledge Instruments.
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 8-K Disclosure Information: As defined in Section 13.04.
Formula Rate: With respect to the Class 4-A-2 Certificates, the per annum rate set
forth or calculated in the manner described in the Preliminary Statement. Interest on the Class 4-A-2
Certificates (to the extent it is entitled to interest from Loan Group 4) shall be computed on the basis
of a 360-day year and the actual number of days elapsed in the related Accrual Period.
Fraud Loan: A Liquidated Mortgage Loan in Loan Group 1, Loan Group 2 or Loan Group 3
as to which a Fraud Loss has occurred.
Fraud Loss Coverage Amount: The aggregate amount of Fraud Losses that are allocated
solely to the Class C-B Certificates, as of the Closing Date, $14,651,043.72, subject to reduction from
time to time by the amount of Fraud Losses allocated to the Class C-B Certificates. In addition, (a) on
each anniversary prior to the fifth anniversary of the Cut-off Date, the Fraud Loss Coverage Amount will
be reduced to an amount equal to the lesser of (A) 1.00% of the Aggregate Groups 1-3 Collateral Balance
as of such date, and (B) the excess of the Fraud Loss Coverage Amount as of the preceding anniversary of
the Cut-off Date over the cumulative amount of Fraud Losses on the Mortgage Loans in Loan Group 1, Loan
Group 2 and Loan Group 3 allocated to the Class C-B Certificates since such preceding anniversary or the
Cut-off Date, and (b) on the fifth anniversary of the Cut-off Date, zero. The Fraud Loss Coverage
Amount may be reduced below the amount set forth above for any Distribution Date with the consent of the
Rating Agencies as evidenced by a letter of each Rating Agency to the Trust Administrator to the effect
that any such reduction will not result in a downgrading of the current ratings assigned to such Classes
of Certificates rated by it.
Fraud Loss Coverage Termination Date: The point in time at which the applicable Fraud
Loss Coverage Amount has been reduced to zero.
Fraud Losses: Realized Losses on the Liquidated Mortgage Loans in Loan Group 1, Loan
Group 2 and Loan Group 3 as to which a loss is sustained by reason of a default arising from fraud,
dishonesty or misrepresentation in connection with the related Mortgage Loan, including a loss by reason
of the denial of coverage under any related Mortgage Guaranty Insurance Policy because of such fraud,
dishonesty or misrepresentation.
GreenPoint: GreenPoint Mortgage Funding, Inc., a New York corporation, and its
successors and assigns.
GreenPoint Serviced Mortgage Loans: The Mortgage Loans identified as such on the
Mortgage Loan Schedule, for which GreenPoint is the applicable Servicer.
Gross Margin: With respect to any Mortgage Loan, the fixed percentage amount set
forth in the related Mortgage Note and the Mortgage Loan Schedule that is added to the Index on each
Adjustment Date in accordance with the terms of the related Mortgage Note to determine the new Mortgage
Rate for such Mortgage Loan.
Group: When used with respect to the Mortgage Loans, any of Loan Group 1, Loan
Group 2, Loan Group 3 or Loan Group 4, or with respect to the Certificates, the Class or Classes of
Certificates that relate to the corresponding Group or Groups.
Group 1: With respect to the Mortgage Loans, the pool of adjustable rate Mortgage
Loans identified in the Mortgage Loan Schedule as having been assigned to Group 1 or with respect to the
Certificates, the Group 1 Certificates (as specified in the Preliminary Statement).
Group 1 Senior Liquidation Amount: With respect to any Distribution Date, the
aggregate, for each Mortgage Loan in Loan Group 1 which became a Liquidated Mortgage Loan during the
prior calendar month, of the lesser of (i) the Group 1 Senior Percentage of the Stated Principal Balance
of such Mortgage Loan and (ii) the applicable Senior Prepayment Percentage of the Liquidation Principal
with respect to such Mortgage Loan.
Group 1 Senior Percentage: With respect to any Distribution Date, the percentage
equivalent of a fraction the numerator of which is the aggregate Class Principal Balance of the Group 1
Certificates immediately prior to such Distribution Date and the denominator of which is the aggregate
of the Stated Principal Balances of the Mortgage Loans in Loan Group 1 as of the first day of the
related Collection Period (excluding any Group 1 Mortgage Loans that were subject to a Payoff, the
principal of which was distributed on the Distribution Date preceding the current Distribution Date);
provided, however, in no event will the Group 1 Senior Percentage exceed 100%.
Group 1 Senior Principal Distribution Amount: With respect to any Distribution Date,
the sum of (i) the Group 1 Senior Percentage of the Principal Payment Amount for Loan Group 1, (ii) the
applicable Senior Prepayment Percentage of the Principal Prepayment Amount for Loan Group 1, and
(iii) the Group 1 Senior Liquidation Amount.
Group 1 Subordinate Percentage: For any Distribution Date, the excess of 100% over
the Group 1 Senior Percentage.
Group 2: With respect to the Mortgage Loans, the pool of adjustable rate Mortgage
Loans identified in the Mortgage Loan Schedule as having been assigned to Group 2 or with respect to the
Certificates, the Group 2 Certificates (as specified in the Preliminary Statement).
Group 2 Senior Liquidation Amount: With respect to any Distribution Date, the
aggregate, for each Mortgage Loan in Loan Group 2 which became a Liquidated Mortgage Loan during the
prior calendar month, of the lesser of (i) the Group 2 Senior Percentage of the Stated Principal Balance
of such Mortgage Loan and (ii) the applicable Senior Prepayment Percentage of the Liquidation Principal
with respect to such Mortgage Loan.
Group 2 Senior Percentage: With respect to any Distribution Date, the percentage
equivalent of a fraction the numerator of which is the aggregate Class Principal Balance of the Group 2
Certificates immediately prior to such Distribution Date and the denominator of which is the aggregate
of the Stated Principal Balances of the Mortgage Loans in Loan Group 2 as of the first day of the
related Collection Period (excluding any Group 2 Mortgage Loans that were subject to a Payoff, the
principal of which was distributed on the Distribution Date preceding the current Distribution Date);
provided, however, in no event will the Group 2 Senior Percentage exceed 100%.
Group 2 Senior Principal Distribution Amount: With respect to any Distribution Date,
the sum of (i) the Group 2 Senior Percentage of the Principal Payment Amount for Loan Group 2, (ii) the
applicable Senior Prepayment Percentage of the Principal Prepayment Amount for Loan Group 2, and
(iii) the Group 2 Senior Liquidation Amount.
Group 2 Subordinate Percentage: For any Distribution Date, the excess of 100% over
the Group 2 Senior Percentage.
Group 3: With respect to the Mortgage Loans, the pool of adjustable rate Mortgage
Loans identified in the Mortgage Loan Schedule as having been assigned to Group 3 or with respect to the
Certificates, the Group 3 Certificates (as specified in the Preliminary Statement).
Group 3 Senior Liquidation Amount: With respect to any Distribution Date, the
aggregate, for each Mortgage Loan in Loan Group 3 which became a Liquidated Mortgage Loan during the
prior calendar month, of the lesser of (i) the Group 3 Senior Percentage of the Stated Principal Balance
of such Mortgage Loan and (ii) the applicable Senior Prepayment Percentage of the Liquidation Principal
with respect to such Mortgage Loan.
Group 3 Senior Percentage: With respect to any Distribution Date, the percentage
equivalent of a fraction the numerator of which is the aggregate Class Principal Balance of the Group 3
Certificates immediately prior to such Distribution Date and the denominator of which is the aggregate
of the Stated Principal Balances of the Mortgage Loans in Loan Group 3, as of the first day of the
related Collection Period (excluding any such Mortgage Loans that were subject to a Payoff, the
principal of which was distributed on the Distribution Date preceding the current Distribution Date);
provided, however, in no event will the Group 3 Senior Percentage exceed 100%.
Group 3 Senior Principal Distribution Amount: With respect to any Distribution Date,
the sum of (i) the Group 3 Senior Percentage of the Principal Payment Amount for Loan Group 3, (ii) the
applicable Senior Prepayment Percentage of the Principal Prepayment Amount for Loan Group 3, and
(iii) the Group 3 Senior Liquidation Amount.
Group 3 Subordinate Percentage: For any Distribution Date, the excess of 100% over
the Group 3 Senior Percentage.
Group 4: With respect to the Mortgage Loans, the pool of adjustable rate Mortgage
Loans identified in the Mortgage Loan Schedule as having been assigned to Group 4 or with respect to the
Certificates, the Group 4 Certificates.
Group 4 Certificates: As set forth in the Preliminary Statement.
Group 4 Credit Support Depletion Date: The first Distribution Date on which the
aggregate Class Principal Balance of the Group 4 Subordinate Certificates has been or will be reduced to
zero.
Group 4 Interest Rate Cap Accounts: Collectively, the Class 4-A-1/4-A-3/4-A-4 Interest
Rate Cap Account, the Class 4-A-2 Interest Rate Cap Account and the Class 4-M/4-B Interest Rate Cap
Account.
Group 4 Interest Rate Cap Agreements: Collectively, the Class 4-A-1/4-A-3/4-A-4
Interest Rate Cap Agreement, the Class 4-A-2 Interest Rate Cap Agreement and the Class 4-M/4-B Interest
Rate Cap Agreement.
Group 4 Interest Rate Cap Counterparty: Credit Suisse International, or any successor
in interest thereto under any Group 4 Interest Rate Cap Agreement.
Group 4 Senior Certificates: As set forth in the Preliminary Statement.
Group 4 Senior Enhancement Percentage: For any Distribution Date, the fraction,
expressed as a percentage, the numerator of which is the sum of the aggregate Class Principal Balance of
the Class 4-M Certificates, the Class 4-B-1 Certificates and the Overcollateralization Amount (which,
for purposes of this definition only, shall not be less than zero), in each case after giving effect to
payments on such Distribution Date (assuming no Trigger Event has occurred), and the denominator of
which is the Aggregate Loan Group Balance for Loan Group 4 for such Distribution Date.
Group 4 Senior Principal Payment Amount: For any Distribution Date on or after the
Stepdown Date and as long as a Trigger Event has not occurred with respect to such Distribution Date,
will be the amount, if any, by which (x) the aggregate Class Principal Balance of the Group 4 Senior
Certificates, immediately prior to such Distribution Date exceeds (y) the lesser of (A) the product of
(i) 83.40% and (ii) the Aggregate Loan Group Balance for Loan Group 4 for such Distribution Date and (B)
the amount, if any, by which (i) the Aggregate Loan Group Balance for Loan Group 4 for such Distribution
Date exceeds (ii) 0.50% of the Aggregate Loan Group Balance for Loan Group 4 as of the Cut-off Date.
Group 4 Subordinate Certificates: As set forth in the Preliminary Statement.
Hemisphere: Hemisphere National Bank, and its successors and assigns.
Hemisphere Serviced Mortgage Loans: The Mortgage Loans identified as such on the
Mortgage Loan Schedule, for which Hemisphere is the applicable Servicer.
Hemisphere Reconstituted Servicing Agreement: That certain Reconstituted Servicing
Agreement dated as of July 1, 2006 among DLJMC, Hemisphere, the Master Servicer and the Trust
Administrator, and acknowledged by the Trustee.
Hemisphere Underlying Servicing Agreement: The "Servicing Agreement" referred to in
the Hemisphere Reconstituted Servicing Agreement.
Index: With respect to any Mortgage Loan and each related Adjustment Date, the index
as specified in the related Mortgage Note.
Indirect Participants: Entities, such as banks, brokers, dealers and trust companies,
that clear through or maintain a custodial relationship with a Participant, either directly or
indirectly.
Initial Bankruptcy Loss Coverage Amount: $100,000.
Initial Class Principal Balance: As set forth in the Preliminary Statement.
Insurance Policy: With respect to any Mortgage Loan included in the Trust Fund, any
Mortgage Guaranty Insurance Policy, any standard hazard insurance policy, flood insurance policy or
title insurance policy, including all riders and endorsements thereto in effect, including any
replacement policy or policies for any Insurance Policies.
Insurance Proceeds: Proceeds of any primary mortgage guaranty insurance policies,
including, without limitation, any other Insurance Policies with respect to the Mortgage Loans, to the
extent such proceeds are not applied to the restoration of the related Mortgaged Property or released to
the Mortgagor in accordance with the related Servicer's or Designated Servicer's normal servicing
procedures.
Interest Determination Date: With respect to the LIBOR Certificates and for each
Accrual Period, the second LIBOR Business Day preceding the commencement of such Accrual Period.
Interest Distribution Amount: With respect to any Distribution Date and interest
bearing Class of Group 1, Group 2, Group 3 and Class C-B Certificates, the sum of (i) one month's
interest accrued during the related Accrual Period at the applicable Pass-Through Rate for such Class on
the related Class Principal Balance or Class Notional Amount, as applicable, subject to reduction
pursuant to Section 4.01(I)(B), and (ii) any Class Unpaid Interest Amounts for such Class and
Distribution Date.
Interest Remittance Amount: For any Distribution Date and the Mortgage Loans in Loan
Group 4, an amount equal to the sum of (1) all interest collected (other than Payaheads) or advanced in
respect of Scheduled Payments on the Mortgage Loans in such Loan Group during the related Collection
Period, the interest portion of Payaheads previously received on the Mortgage Loans in such Loan Group
and intended for application in the related Collection Period and interest portion of all Payoffs (net
of Payoff Interest for such Distribution Date) and Curtailments received on the Mortgage Loans in such
Loan Group during the related Prepayment Period, less (x) the applicable Expense Fees with respect to
such Mortgage Loans and (y) unreimbursed Advances and other amounts due to the Master Servicer, the
applicable Servicer and the Trust Administrator with respect to such Mortgage Loans, to the extent
allocable to interest, (2) all Compensating Interest Payments paid by a Servicer with respect to the
Mortgage Loans in such Loan Group with respect to the related Prepayment Period, (3) the portion of any
Substitution Adjustment Amount and Purchase Price paid with respect to the Mortgage Loans in such Loan
Group during the related Collection Period, in each case allocable to interest and the proceeds of any
purchase of such Mortgage Loans by the Terminating Entity pursuant to Section 11.01 in an amount not
exceeding the interest portion of the Par Value with respect to such Mortgage Loans, (4) all Net
Liquidation Proceeds and Recoveries (net of unreimbursed Advances, Servicing Advances and expenses, to
the extent allocable to interest, and unpaid Expense Fees), if any, collected with respect to the
Mortgage Loans in such Loan Group during the prior calendar month, to the extent allocable to interest
and (5) the Capitalized Interest Distribution for such Distribution Date.
Interest Shortfall: For any Distribution Date and the Mortgage Loans in Loan Group 4,
an amount equal to the aggregate shortfall, if any, in collections of interest (adjusted to the related
Net Mortgage Rate) on Mortgage Loans in Loan Group 4 resulting from (a) Principal Prepayments received
during the related Prepayment Period after giving effect to the Compensating Interest Payment for such
Distribution Date and (b) interest payments on certain of the Mortgage Loans in Loan Group 4 being
limited pursuant to the provisions of the Relief Act.
LaSalle: LaSalle Bank, National Association.
LaSalle Bank Custodial Agreement: That certain Custodial Agreement dated as of
July 1, 2006 among LaSalle, the Trustee and the Trust Administrator.
Lender Paid Mortgage Guaranty Insurance Policy: Any lender paid Mortgage Guaranty
Insurance Policy.
LIBOR Business Day: Any day other than (i) a Saturday or a Sunday or (ii) a day on
which banking institutions in the State of New York or in the City of London, England are required or
authorized by law to be closed.
LIBOR Certificates: As set forth in the Preliminary Statement.
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 a Servicer, has determined (with respect to the Non-Designated
Mortgage Loans, in accordance with this Agreement, or with respect to the Designated Mortgage Loans, in
accordance with the related Designated Servicing 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
the related REO Property, whether from Insurance Proceeds, Liquidation Proceeds or otherwise.
Liquidation Expenses: Customary and reasonable "out of pocket" expenses incurred by a
Servicer (or the related Sub-Servicer) in connection with the liquidation of any defaulted Mortgage Loan
and not recovered by the related Servicer (or the related Sub-Servicer) under a Mortgage Guaranty
Insurance Policy for reasons other than such Servicer's failure to comply with Section 3.09 hereof, such
expenses including, without limitation, legal fees and expenses, any unreimbursed amount expended by a
Servicer pursuant to Section 3.11 hereof respecting the related Mortgage and any related and
unreimbursed expenditures for real estate property taxes or for property restoration or preservation to
the extent not previously reimbursed under any hazard insurance policy for reasons other than such
Servicer's failure to comply with Section 3.11 hereof.
Liquidation Principal: With respect to any Distribution Date and a Loan Group, the
principal portion of Net Liquidation Proceeds received with respect to each Mortgage Loan in that Loan
Group, but not in excess of the principal balance of such Mortgage Loan, which became a Liquidated
Mortgage Loan (but not in excess of the principal balance thereof) during the preceding calendar month,
exclusive of the portion thereof, if any, attributable to Assigned Prepayment Premiums.
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 related to a Mortgage Loan and any other proceeds received in connection with an
REO Property, other than Recoveries.
Loan Group: Any of Loan Group 1, Loan Group 2, Loan Group 3 or Loan Group 4, as
applicable. Loan Group 1, Loan Group 2 and Loan Group 3 together will constitute one sub-trust and Loan
Group 4 will constitute another sub-trust.
Loan Group 1: All Mortgage Loans identified as Loan Group 1 Mortgage Loans on the
Mortgage Loan Schedule.
Loan Group 2: All Mortgage Loans identified as Loan Group 2 Mortgage Loans on the
Mortgage Loan Schedule.
Loan Group 3: All Mortgage Loans identified as Loan Group 3 Mortgage Loans on the
Mortgage Loan Schedule.
Loan Group 4: All Mortgage Loans identified as Loan Group 4 Mortgage Loans on the
Mortgage Loan Schedule.
Loan-to-Value Ratio: As of any date, the fraction, expressed as a percentage, the
numerator of which is the Stated Principal Balance of the related Mortgage Loan at the date of
determination and the denominator of which is the Appraised Value of the Mortgaged Property.
Lost Mortgage Note: Any Mortgage Note the original of which was permanently lost or
destroyed and has not been replaced.
Majority Servicer: With respect to any Optional Termination, the Servicer servicing
the largest percentage of Mortgage Loans in the Loan Group(s) to be purchased in such Optional
Termination (by Stated Principal Balance of outstanding Mortgage Loans on the Optional Termination Date)
which has notified the Trust Administrator of its intention to be the Terminating Entity of such Loan
Group(s) pursuant to Section 11.02(a).
Marker Rate: With respect to the Class 4-X Certificates and REMIC II Regular
Interests LT1, LT2, LT3 and LT4 and any Distribution Date, a per annum rate equal to two (2) times the
weighted average of the Uncertificated REMIC II Pass-Through Rates for REMIC II Regular Interest LT2 and
REMIC II Regular Interest LT3.
Master Servicer: Xxxxx Fargo.
Maturity Date: The Distribution Date occurring in August 2036.
Maximum Interest Rate: With respect to the Group 4 Certificates and any Distribution
Date, an annual rate equal to the weighted average of the Maximum Mortgage Rates of the Mortgage Loans
in Loan Group 4 minus the weighted average Expense Fee Rate of the Mortgage Loans in Loan Group 4.
Maximum Mortgage Rate: With respect to each Mortgage Loan, the percentage set forth
in the related Mortgage Note as the maximum Mortgage Rate thereunder.
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.
MERS® System: The system of recording transfers of mortgages electronically
maintained by MERS.
MIN: The mortgage identification number for any MERS Mortgage Loan.
Minimum Mortgage Rate: With respect to each Mortgage Loan, the percentage set forth
in the related Mortgage Note as the minimum Mortgage Rate thereunder.
MOM Loan: Any Mortgage Loan as to which MERS is acting as mortgagee, solely as
nominee for the originator of such Mortgage Loan and its successors and assigns.
Monthly Excess Cashflow: For any Distribution Date, an amount equal to the sum of the
Monthly Excess Interest for such Distribution Date, the Overcollateralization Release Amount, if any for
such Distribution Date, and any Principal Payment Amount for such Distribution Date remaining after the
application of items (i) through (xii) in the distribution thereof pursuant to Section 4.01(II)(a),
(b) or (c), as applicable.
Monthly Excess Interest: For any Distribution Date, any Interest Remittance Amount
remaining after the application of items (i) through (v) in the distribution thereof, pursuant to
Section 4.01(II)(a).
Moody's: Xxxxx'x Investors Service, Inc. or any successor thereto.
Mortgage: With respect to a Mortgage Loan, the mortgage, deed of trust or other
instrument creating a first lien on a fee simple or leasehold estate securing a Mortgage Note.
Mortgaged Property: The underlying real property securing a Mortgage Loan or, with
respect to a Cooperative Loan, the related Cooperative Shares and Proprietary Lease.
Mortgage File: For each Mortgage Loan, the Trustee Mortgage File and the Servicer
Mortgage File.
Mortgage Guaranty Insurance Policy: Each policy of primary mortgage guaranty
insurance or any replacement policy therefor with respect to any Mortgage Loan.
Mortgage Loans: Such of the mortgage loans and cooperative loans (if any) transferred
and assigned to the Trustee pursuant to the provisions hereof as from time to time are held as a part of
the Trust Fund (including any REO Property), the mortgage loans so held being identified in the Mortgage
Loan Schedule, notwithstanding foreclosure or other acquisition of title of the related Mortgaged
Property. With respect to each Mortgage Loan that is a Cooperative Loan, if any, "Mortgage Loan" shall
include, but not be limited to, the related Mortgage Note, Security Agreement, Assignment of Proprietary
Lease, Recognition Agreement, Cooperative Shares and Proprietary Lease and, with respect to each
Mortgage Loan other than a Cooperative Loan, "Mortgage Loan" shall include, but not be limited to the
related Mortgages and the related Mortgage Notes.
Mortgage Loan Purchase Price: The price, calculated as set forth in Section 11.01, to
be paid in connection with the purchase of the Mortgage Loans pursuant to an Optional Termination of the
Trust Fund.
Mortgage Loan Schedule: The list of Mortgage Loans (as from time to time amended by
the Seller to reflect the addition of Qualified Substitute Mortgage Loans and the purchase of Mortgage
Loans pursuant to Sections 2.01, 2.02 or 2.03) 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 and applicable Servicer by Loan Group:
1. the Mortgage Loan identifying number;
2. a code indicating the type of Mortgaged Property and the occupancy status;
3. a code indicating the Servicer of the Mortgage Loan;
4. the original months to maturity;
5. the Loan-to-Value Ratio at origination;
6. the combined Loan-to-Value Ratio at origination;
7. a code indicating the existence of a subordinate lien for the related mortgaged property;
8. the related borrower's debt-to-income ratio at origination;
9. the related xxxxxxxx's credit score at origination;
10. the Mortgage Rate as of the Cut-off Date;
11. the stated maturity date;
12. the amount of the Scheduled Payment as of the Cut-off Date;
13. the original principal amount of the Mortgage Loan;
14. the principal balance of the Mortgage Loan as of the close of business on the Cut-off Date,
after deduction of payments of principal due on or before the Cut-off Date whether or not collected;
15. the purpose of the Mortgage Loan (i.e., purchase, rate and term refinance, equity take-out
refinance);
16. a code indicating whether a Prepayment Premium is required to be paid in connection with a
prepayment of the Mortgage Loan and the term and the amount of the Prepayment Premium;
17. an indication whether the Mortgage Loan accrues interest at an adjustable Mortgage Rate or a
fixed Mortgage Rate;
18. the Index that is associated with such Mortgage Loan, if applicable;
19. the Gross Margin, if applicable;
20. the Periodic Rate Cap, if applicable;
21. the Minimum Mortgage Rate, if applicable;
22. the Maximum Mortgage Rate, if applicable;
23. the first Adjustment Date after the Cut-off Date, if applicable;
24. the Servicing Fee Rate;
25. the Expense Fee Rate;
26. a code indicating whether the Mortgage Loan is covered under a borrower paid or lender paid
Primary Insurance Policy (and, if so, the name of the insurance carrier) and the rate at which any
lender paid Primary Insurance Policy premium is calculated, if applicable;
27. the Custodian for such Mortgage Loan; and
28. a code indicating whether the Mortgage Loan is a MERS Mortgage Loan and, if so, its
corresponding MIN.
With respect to the Mortgage Loans in the aggregate, each Mortgage Loan Schedule shall
set forth the following information, as of the Cut-off Date:
1. the number of Mortgage Loans;
2. the current aggregate principal balance of the Mortgage Loans as of the close of business on
the Cut-off Date, after deduction of payments of principal due on or before the Cut-off Date whether or
not collected; and
3. the weighted average Mortgage Rate of the Mortgage Loans.
Mortgage Note: The original executed note or other evidence of the indebtedness of a
Mortgagor under a Mortgage Loan.
Mortgage Rate: The annual rate of interest borne by a Mortgage Note.
Mortgagor: The obligor on a Mortgage Note.
Net Excess Spread: With respect to any Distribution Date and Loan Group 4, a
fraction, expressed as a percentage, the numerator of which is equal to the excess of (x) the Aggregate
Loan Group Balance for Loan Group 4 for the immediately preceding Distribution Date, multiplied by the
product of (A) the Net WAC Rate for Loan Group 4 and (B) the actual number of days elapsed in the
related Accrual Period divided by 360 over (y) the aggregate Current Interest for Loan Group 4 for such
Distribution Date, and the denominator of which is an amount equal to the Aggregate Loan Group Balance
for Loan Group 4 for the immediately preceding Distribution Date, multiplied by the actual number of
days elapsed in the related Accrual Period divided by 360.
Net Funds Cap: For any Distribution Date and the Group 4 Certificates (other than the
Class 4-X Certificates and other than the Class 4-A-2 Certificates except on any Distribution Date in
which on the related Swap Payment Date a Swap Suspension Event has occurred and is continuing), will be
a per annum rate equal to (a) a fraction, expressed as a percentage, the numerator of which is the
product of (1) the Optimal Interest Remittance Amount for such date and (2) 12, and the denominator of
which is the Aggregate Loan Group Balance for Loan Group 4 (excluding any such Mortgage Loans that were
subject to a Payoff, the principal of which was distributed on the Distribution Date preceding the
current Distribution Date) for the immediately preceding Distribution Date (or, in the case of the first
Distribution Date, the Aggregate Loan Group Balance for Loan Group 4 as of the Cut-off Date, multiplied
by (b) a fraction, the numerator of which is 30 and the denominator of which is the actual number of
days in the related Accrual Period.
Net Interest Shortfalls: For any Distribution Date and the Group 1, Group 2 and
Group 3 Mortgage Loans, the sum of (A) the amount of interest which would otherwise have been received
for a Mortgage Loan in the related Loan Group during the prior calendar month that was the subject of
(x) a Relief Act Reduction or (y) a Special Hazard Loss, Fraud Loss or Bankruptcy Loss, after the
exhaustion of the respective amounts of coverage provided by the Class C-B Certificates for those types
of losses; and (B) any related Net Prepayment Interest Shortfalls.
Net Liquidation Proceeds: With respect to any Liquidated Mortgage Loan, the excess of
the related Liquidation Proceeds over the sum of Liquidation Expenses, Expense Fees, unreimbursed
Advances and Servicing Advances and related Excess Proceeds, if any.
Net Mortgage Rate: As to each Mortgage Loan, and at any time, the per annum rate
equal to the Mortgage Rate for such Mortgage Loan less the related Expense Fee Rate.
Net Prepayment Interest Shortfalls: With respect to any Distribution Date, the amount
by which the aggregate of Prepayment Interest Shortfalls during the related Prepayment Period exceeds
the Compensating Interest Payment for such Distribution Date.
Net Realized Losses: For any Class of Certificates, other than the Group 4
Certificates, and any Distribution Date, the excess of (i) the amount of unreimbursed Realized Losses
previously allocated to that Class over (ii) the sum of (a) the amount of any increases to the Class
Principal Balance of that Class pursuant to Section 4.03 due to Recoveries and (b) amounts previously
distributed to such Class in respect of Realized Losses pursuant to Section 4.01.
Net Recovery Realized Losses: For any Class of Certificates, other than the Group 4
Certificates, and any Distribution Date, the excess of Net Realized Losses for such Distribution Date
over the amount distributed in respect of Realized Losses pursuant to Section 4.01 on that Distribution
Date.
Net Swap Payments: A net payment (a) by the Supplemental Interest Trust Trustee, on
behalf of the Supplemental Interest Trust, to the Swap Counterparty, to the extent that the Supplemental
Trust Payment exceeds the Swap Counterparty Payment for such Swap Payment Date, or (b) by the Swap
Counterparty to the Supplemental Interest Trust Trustee, on behalf of the Supplemental Interest Trust,
to the extent that the Swap Counterparty Payment payable to the Supplemental Interest Trust exceeds the
Supplemental Trust Payment for such Swap Payment Date.
Net WAC Rate: With respect to Loan Group 1, Loan Group 2 and Loan Group 3 and for any
Distribution Date, the Weighted Average Pass-Through Rate for such Loan Group for such Distribution Date.
In addition, for any purpose for which the Net WAC Rate is calculated, the interest
rate on the Mortgage Loans shall be appropriately adjusted to account for the difference between any
counting convention used with respect to the Mortgage Loans and any counting convention used with
respect to a REMIC Regular Interest.
NIM Note: Any debt instrument issued by a NIM Trust.
NIM Trust: Any trust created to hold the Class 4-X Certificates and issue debt
instruments that are secured by distributions on the Class 4-X Certificates.
Non-Designated Mortgage Loans: The Mortgage Loans that are not Designated Mortgage
Loans.
Nonrecoverable Advance: Any portion of an Advance or Servicing Advance previously
made or proposed to be made by the Master Servicer or a Servicer that, in the good faith judgment of the
Master Servicer or a Servicer (as applicable), will not be ultimately recoverable by the Master Servicer
or a Servicer (as applicable) from the related Mortgagor, related Liquidation Proceeds or otherwise from
proceeds or collections on the related Mortgage Loan.
Notional Amount Certificates: As set forth in the Preliminary Statement.
Offered Certificates: As set forth in the Preliminary Statement.
Officer's Certificate: A certificate signed by the Chairman of the Board, any Vice
Chairman of the Board, the President, an Executive Vice President, Senior Vice President, a Vice
President, or other authorized officer, the Treasurer, the Secretary, or one of the Assistant Treasurers
or Assistant Secretaries of the Depositor, the Seller, the Master Servicer, the Servicers, the Special
Servicer, a Sub-Servicer, the Trustee or the Trust Administrator, as the case may be, and delivered to
the Depositor, the Seller, the Master Servicer, the Special Servicer, the Servicers, the Trustee or the
Trust Administrator, as required by this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be counsel for the
Depositor, the Master Servicer or a Servicer, including in-house counsel, reasonably acceptable to the
Trustee and the Trust Administrator. With respect to the definition of Eligible Account in this Article
I and Sections 2.05 and 7.04 hereof and any opinion dealing with the qualification of each REMIC created
hereunder or compliance with the REMIC Provisions, such counsel must (i) in fact be independent of the
Depositor, the Master Servicer and such Servicer, (ii) not have any direct financial interest in the
Depositor, the Master Servicer or such Servicer or in any affiliate of either of them and (iii) not be
connected with the Depositor, the Master Servicer or such Servicer as an officer, employee, promoter,
underwriter, trustee, partner, director or Person performing similar functions; provided, that with
respect to Wells Fargo,. as Servicer, such counsel may be in-house counsel for Xxxxx Fargo, as Servicer.
Optimal Interest Remittance Amount: With respect to any Distribution Date and Loan
Group 4, the excess of (i) the product of (1)(x) the weighted average of the Net Mortgage Rates of the
Mortgage Loans in Loan Group 4 as of the first day of the related Collection Period divided by (y) 12
and (2) the Aggregate Loan Group Balance for Loan Group 4 for the immediately preceding Distribution
Date (excluding any such Mortgage Loans that were subject to a Payoff, the principal of which was
distributed on the Distribution Date preceding the current Distribution Date), over (ii) any expenses
that reduce the Interest Remittance Amount with respect to Loan Group 4 that did not arise as a result
of a default or delinquency of the Mortgage Loans in Loan Group 4 or were not taken into account in
computing the Expense Fee Rate.
Optional Termination: The purchase of the Mortgage Loans pursuant to Section 11.01.
Optional Termination Date: The date fixed by a Terminating Entity for the purchase of
the Mortgage Loans pursuant to Section 11.01.
Optional Termination Notice Period: The period during which notice is to be given to
the affected Certificateholders of an Optional Termination pursuant to Section 11.03(d).
OTS: The Office of Thrift Supervision.
Outsourcer: As defined in Section 3.02.
Overcollateralization Amount: For any Distribution Date, an amount equal to the
amount, if any, by which (x) the Aggregate Loan Group Balance for Loan Group 4 for such Distribution
Date exceeds (y) the aggregate Class Principal Balance of the Group 4 Certificates (other than the
Class 4-X Certificates) after giving effect to payments on such Distribution Date.
Overcollateralization Deficiency: For any Distribution Date, the amount, if any, by
which (x) the Targeted Overcollateralization Amount for such Distribution Date exceeds (y) the
Overcollateralization Amount for such Distribution Date, calculated for this purpose after giving effect
to the reduction on such Distribution Date of the aggregate Class Principal Balance of the Group 4
Certificates (other than the Class 4-X Certificates) resulting from the payment of the Principal Payment
Amount on such Distribution Date but prior to allocation of any Applied Loss Amount on the Group 4
Certificates on such Distribution Date.
Overcollateralization Release Amount: For any Distribution Date, an amount equal to
the lesser of (x) the Principal Remittance Amount for such Distribution Date and (y) the amount, if any,
by which (1) the Overcollateralization Amount for such date, calculated for this purpose on the basis of
the assumption that 100% of the Principal Remittance Amount for such date is applied on such date in
reduction of the aggregate of the Class Principal Balances of the Group 4 Certificates (other than the
Class 4-X Certificates), exceeds (2) the Targeted Overcollateralization Amount for such date.
Overcollateralized Group: As defined in Section 4.07(b).
Participant: A broker, dealer, bank, other financial institution or other Person for
whom DTC effects book entry transfers and pledges of securities deposited with DTC.
Par-Value: As defined in Section 11.01.
Pass-Through Entity: (a) a regulated investment company described in Section 851 of
the Code, a real estate investment trust described in Section 856 of the Code, a common trust fund or an
organization described in Section 1381(a) of the Code, (b) any partnership, trust or estate or (c) any
person holding a Class A Certificate as nominee for another person.
Pass-Through Rate: For any interest bearing Class of Certificates (other than
Class 4-A-2 Certificates), the per annum rate set forth or calculated in the manner described in the
Preliminary Statement. Interest on the Certificates, other than the LIBOR Certificates, shall be
computed on the basis of a 360 day year comprised of twelve 30 day months. Interest on the LIBOR
Certificates and the Class 4-X Certificates (to the extent it is entitled to interest from Loan Group 4)
shall be computed on the basis of a 360-day year and the actual number of days elapsed in the related
Accrual Period.
Payahead: Any Scheduled Payment intended by the related Mortgagor to be applied in a
Collection Period subsequent to the Collection Period in which such payment was received.
Payoff: Any payment of principal on a Mortgage Loan equal to the entire outstanding
Stated Principal Balance of such Mortgage Loan, if received in advance of the last scheduled Due Date
for such Mortgage Loan and accompanied by an amount of interest equal to accrued unpaid interest on the
Mortgage Loan to the date of such payment in full.
Payoff Interest: For any Distribution Date with respect to each SPS Serviced Mortgage
Loan for which a Payoff was received on or after the first calendar day of the month of such
Distribution Date and before the 15th calendar day of such month, an amount of interest thereon at the
applicable Net Mortgage Rate from the first day of such month through the day of receipt thereof.
PCAOB: The Public Company Accounting Oversight Board.
Percentage Interest: With respect to any Certificate, either the percentage 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.
Person: Any individual, corporation, partnership, joint venture, association, joint
stock company, trust, unincorporated organization or government, or any agency or political subdivision
thereof.
Physical Certificates: As set forth in the Preliminary Statement.
Pledge Instruments: With respect to each Cooperative Loan, the Stock Power, the
Assignment of Proprietary Lease and the Security Agreement.
Prepayment Interest Shortfall: With respect to any Mortgage Loan, Distribution Date
and Principal Prepayment (other than a Payoff on a Xxxxx Fargo Serviced Mortgage Loan received during
the period from and including the first day to and including the 13th day of the month of such
Distribution Date or a Payoff on a GreenPoint Serviced Mortgage Loan or SPS Serviced Mortgage Loan
received during the period from and including the first day to and including the 14th day of the month
of such Distribution Date) received during the related Prepayment Period, the difference between (i) one
full month's interest at the applicable Mortgage Rate (giving effect to any applicable Relief Act
Reduction, Debt Service Reduction and Deficient Valuation), as reduced by the Servicing Fee Rate, if
applicable, on the outstanding principal balance of such Mortgage Loan immediately prior to such
prepayment or, if such Principal Prepayment is a Curtailment, the principal amount of such Curtailment
and (ii) the amount of interest actually received with respect to such Mortgage Loan in connection with
such Principal Prepayment, net of the Servicing Fee, if applicable.
Prepayment Period: With respect to each Distribution Date and each Payoff with
respect to a Xxxxx Fargo Serviced Mortgage Loan, the related "Prepayment Period" will commence on the
14th day of the month preceding the month in which the related Distribution Date occurs (or, in the case
of the first Distribution Date, commencing on the Cut-off Date) and will end on the 13th day of the
month in which such Distribution Date occurs. With respect to each Distribution Date and each Payoff
with respect to a SPS Serviced Mortgage Loan, the related "Prepayment Period" will commence on the 15th
day of the month preceding the month in which the related Distribution Date occurs (or, in the case of
the first Distribution Date, commencing on the Cut-off Date) and will end on the 14th day of the month
in which such Distribution Date occurs. With respect to each Distribution Date and each Payoff with
respect to a GreenPoint Serviced Mortgage Loan and each Curtailment with respect to any Mortgage Loan,
the related "Prepayment Period" will be the calendar month preceding the month in which such
Distribution Date occurs. With respect to each Distribution Date and each Payoff with respect to any
Mortgage Loan serviced by a Designated Servicer, the related "Prepayment Period" will be the period set
forth in the related Designated Servicing Agreement. With respect to each Distribution Date and each
Curtailment with respect to any Mortgage Loan, the related "Prepayment Period" will be the calendar
month preceding the month in which such Distribution Date occurs.
Prepayment Premium: With respect to any Mortgage Loan, any fee or premium required to
be paid if the Mortgagor prepays such Mortgage Loan as provided in the related Mortgage Note or Mortgage.
Principal Payment Amount: For any Distribution Date and Loan Group 1, Loan Group 2 or
Loan Group 3, the sum of (i) the principal portion of the Scheduled Payments on the Mortgage Loans in
such Loan Group due on the related Due Date, (ii) the principal portion of repurchase proceeds received
with respect to any Mortgage Loan in such Loan Group which was repurchased as permitted or required by
this Agreement during the period beginning on the 15th day of the month preceding such Distribution Date
and ending on the 14th day of the month of such Distribution Date, with notice and receipt of funds
three (3) Business Days prior to the 14th day of the month of such Distribution Date and (iii) any other
unscheduled payments of principal which were received on the Mortgage Loans in such Loan Group during
the related calendar month preceding the month of such Distribution Date, other than Principal
Prepayments or Liquidation Principal.
For any Distribution Date and Loan Group 4, an amount equal to the Principal
Remittance Amount for such date minus the Overcollateralization Release Amount, if any, for such date.
Principal Prepayment: Any payment of principal on a Mortgage Loan which constitutes a
Payoff or Curtailment.
Principal Prepayment Amount: For any Distribution Date and Loan Group 1, Loan Group 2
or Loan Group 3, the sum of (i) all Principal Prepayments relating to the Mortgage Loans in such Loan
Group which were received during the related Prepayment Period and (ii) all Recoveries received during
the calendar month preceding the month of that Distribution Date.
Principal Remittance Amount: For any Distribution Date and Loan Group 4, an amount
equal to (A) the sum of (1) all principal collected (other than Payaheads) or advanced in respect of
Scheduled Payments on the Mortgage Loans in such Loan Group during the related Collection Period (less
unreimbursed Advances, Servicing Advances and other amounts due to the Servicers, the Trustee, the
Master Servicer and the Trust Administrator with respect to the Mortgage Loans in such Loan Group, to
the extent allocable to principal) and the principal portion of Payaheads previously received on the
Mortgage Loans in such Loan Group and intended for application in the related Collection Period, (2) all
Principal Prepayments received on the Mortgage Loans in such Loan Group during the related Prepayment
Period, (3) the Purchase Price of each Mortgage Loan in such Loan Group that was repurchased by the
Seller or purchased by the Special Servicer pursuant to Section 3.11(g) or the holder of the Subordinate
Certificates pursuant to Section 3.11(f), during the related Collection Period, (4) the principal
proceeds of any purchase of Mortgage Loans in such Loan Group by the Terminating Entity pursuant to
Section 11.01 in an amount not exceeding the principal portion of the Par Value with respect to such
Mortgage Loans, (5) the portion of any Substitution Adjustment Amount paid with respect to any Deleted
Mortgage Loans in such Loan Group during the related Collection Period allocable to principal, (6) all
Net Liquidation Proceeds (net of unreimbursed Advances, Servicing Advances and other expenses, to the
extent allocable to principal) and any other Recoveries collected with respect to the Mortgage Loans in
such Loan Group during the preceding calendar month, to the extent allocable to principal, and
(7) amounts, if any, withdrawn from the Group 4 Interest Rate Cap Accounts to cover Realized Losses on
the Group 4 Mortgage Loans incurred during the related Collection Period, less (B) the Capitalization
Reimbursement Amount for such Distribution Date.
Principal Transfer Amount: For any Distribution Date and each Undercollateralized
Group, the excess, if any, of the aggregate Class Principal Balance of the Class A Certificates related
to such Undercollateralized Group over the Aggregate Loan Group Balance of such Group.
Private Certificates: As set forth in the Preliminary Statement.
Proprietary Lease: The lease on a Cooperative Unit evidencing the possessory interest
of the owner of the Cooperative Shares in such Cooperative Unit.
Pro Rata Share: With respect to any Distribution Date and any Class of Class C-B
Certificates, the portion of the Subordinate Principal Distribution Amount allocable to such Class,
equal to the product of the Subordinate Principal Distribution Amount on such Distribution Date and a
fraction, the numerator of which is the related Class Principal Balance of such Class and the
denominator of which is the aggregate of the Class Principal Balances of the Class C-B Certificates.
Prospectus: The Prospectus, dated June 28, 2006, relating to the offering by the
Depositor from time to time of its Mortgage-Backed Pass-Through Certificates (Issuable in Series) in the
form in which it was or will be filed with the Securities and Exchange Commission pursuant to
Rule 424(b) under the 1933 Act with respect to the offer and sale of the Offered Certificates.
Prospectus Supplement: The Prospectus Supplement, dated July 28, 2006, relating to the
offering of the Offered Certificates in the form in which it was or will be filed with the Securities
and Exchange Commission pursuant to Rule 424(b) under the 1933 Act with respect to the offer and sale of
the Offered Certificates.
PUD: Planned Unit Development.
Purchase Price: With respect to any Mortgage Loan required to be repurchased by the
Seller pursuant to Section 2.02 or 2.03, purchased by a holder of certain Certificates pursuant to
Section 3.11(f) or purchased at the option of the Special Servicer pursuant to Section 3.11(g), the sum
of (i) 100% of the Stated Principal Balance of the Mortgage Loan as of the first day of the month of
such purchase, (ii) accrued and unpaid interest on the Mortgage Loan at the applicable Mortgage Rate
(reduced by the related Servicing Fee Rate, if the purchaser is also the Servicer thereof) from the
first day of the month of such purchase to the first day of the month immediately following the month of
such purchase, (iii) in the case of a Mortgage Loan purchased by the Seller or the Depositor, the amount
of any unreimbursed Advances and Servicing Advances made by a Servicer, if such Servicer is not the
Seller or the Depositor, with respect to such Mortgage Loan or, in the case of a Mortgage Loan purchased
by the Special Servicer, any unreimbursed Advances and Servicing Advances payable to any Servicer (other
than the Servicer or Special Servicer, as the case may be, which is purchasing such Mortgage Loans) and
(iv) with respect to any purchase by the Seller pursuant to Section 2.03, any costs and damages actually
incurred and paid by or on behalf of the Trust in connection with any breach of the representation and
warranty set forth in Schedule III(viii) as a result of a violation of a predatory or abusive lending
law applicable to such Mortgage Loan. With respect to any Mortgage Loan required or allowed to be
purchased, the Special Servicer, the Certificateholder, the Seller or the Depositor, as applicable,
shall deliver to the Trustee and the Trust Administrator an Officer's Certificate as to the calculation
of the Purchase Price.
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 or FHLMC approved mortgage insurer or
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.
Qualified Substitute Mortgage Loan: One or more Mortgage Loans substituted by the
Seller for one or more Deleted Mortgage Loans which must, on the date of such substitution, as confirmed
in a Request for Release, substantially in the form of Exhibit K, individually or in the aggregate and
on a weighted average basis, as applicable (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 not more than one year greater than or less than that of the
Deleted Mortgage Loan; provided that the remaining term to maturity of any such Mortgage Loan shall be
no greater than the last maturing Mortgage Loan immediately prior to any substitution; (v) have a
Maximum Mortgage Rate and Minimum Mortgage Rate not less than the respective such rates for the Deleted
Mortgage Loan, have a Gross Margin equal to or greater than the Deleted Mortgage Loan and have the same
Index as the Deleted Mortgage Loan; (vi) not be a Cooperative Loan unless the Deleted Mortgage Loan was
a Cooperative Loan and (vii) comply with each representation and warranty set forth in Section 2.03(b).
Rating Agency: Each of Xxxxx'x and S&P or any successor to any of them, so long as
such entity is rating any of the Certificates.
Ratings: As of any date of determination, the ratings, if any, of the Certificates as
assigned by the Rating Agencies.
Realized Loss: With respect to any Mortgage Loan, (1) 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 applicable Net Mortgage Rate
from the related Due Date as to which interest was last paid or advanced (and not reimbursed) to
Certificateholders up to the related Due Date in the month in which Liquidation Proceeds are required to
be distributed on the Stated Principal Balance of such Liquidated Mortgage Loan from time to time, minus
(iii) the Net Liquidation Proceeds, if any, received during the month in which such liquidation
occurred, to the extent applied as recoveries of interest at the Net Mortgage Rate and to principal of
the Liquidated Mortgage Loan; (2) for any Mortgage Loan subject to a Deficient Valuation, the excess of
the Stated Principal Balance of that Mortgage Loan over the principal amount as reduced in connection
with the proceedings resulting in the Deficient Valuation; or (3) for any Debt Service Reduction
Mortgage Loan, the present value of all monthly Debt Service Reductions on the Mortgage Loan, assuming
that the mortgagor pays each Scheduled Payment on the applicable Due Date and that no Principal
Prepayments are received on the Mortgage Loan, discounted at the applicable Mortgage Rate.
Realized Losses allocated to the Class 4-X Certificates shall be allocated first to
REMIC III Regular Interest 4-X-IO in reduction of the accrued but unpaid interest thereon until such
accrued and unpaid interest shall have been reduced to zero and then to REMIC III Regular
Interest 4-X-PO in reduction of the principal balance thereof.
Recognition Agreement: An Agreement among a Cooperative Corporation, a lender and a
Mortgagor with respect to a Cooperative Loan whereby such parties (i) acknowledge that such lender may
make, or intends to make, such Cooperative Loan, (ii) make certain agreements with respect to such
Cooperative Loan.
Record Date: With respect to any Distribution Date and the Certificates other than
the LIBOR Certificates held in Book-Entry Form on such Distribution Date, the close of business on the
last Business Day of the month preceding the month in which the applicable Distribution Date occurs.
With respect to any Distribution Date and the LIBOR Certificates held in Book-Entry Form on such
Distribution Date, the close of business on the Business Day immediately preceding such Distribution
Date.
Recovery: With respect to any Distribution Date and Mortgage Loan that became a
Liquidated Mortgage Loan in a month preceding the month prior to the Distribution Date, an amount
received in respect of principal on such Mortgage Loan which has previously been allocated as a Realized
Loss or Applied Loss Amount to a Class or Classes of Certificates, net of reimbursable expenses and
related Excess Proceeds, if any.
Reference Bank Rate: With respect to any Accrual Period relating to the LIBOR
Certificates as follows: the arithmetic mean (rounded upwards, if necessary, to the nearest one
sixteenth of a percent) of the offered rates for United States dollar deposits for one month which are
offered by the Reference Banks as of 11:00 a.m., London time, on the Interest Determination Date prior
to the first day of such Accrual Period to prime banks in the London interbank market for a period of
one month in amounts approximately equal to the aggregate Class Principal Balance of the LIBOR
Certificates; provided that at least two such Reference Banks provide such rate. If fewer than two
offered rates appear, the Reference Bank Rate will be the arithmetic mean of the rates quoted by one or
more major banks in New York City, selected by the Trust Administrator after consultation with DLJMC, as
of 11:00 a.m., New York City time, on such date for loans in U.S. Dollars to leading European banks for
a period of one month in amounts approximately equal to the aggregate Class Principal Balance of the
LIBOR Certificates. If no such quotations can be obtained, the Reference Bank Rate shall be the
Reference Bank Rate applicable to the preceding Accrual Period.
Reference Banks: Three major banks that are engaged in the London interbank market,
selected by the Trust Administrator after consultation with DLJMC.
Registration Statement: That certain registration statement on Form S-3, as amended
(Registration No. 333-130884), relating to the offering by the Depositor from time to time of its
Mortgage-Backed Pass-Through Certificates (Issuable in Series) as heretofore declared effective by the
Securities and Exchange Commission.
Regular Certificates: All of the Certificates other than the Class AR and Class AR-L
Certificates.
Regulation AB: Means Subpart 229.1100 - Asset Backed Securities (Regulation AB),
17 C.F.R. §§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 Red. 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.
Regulation S: Regulation S under the 1933 Act, as in effect from time to time.
Relevant Servicing Criteria: The Servicing Criteria applicable to the various parties,
as set forth on Exhibit R attached hereto. For clarification purposes, multiple parties can have
responsibility for the same Relevant Servicing Criteria. With respect to a Servicing Function
Participant engaged by the Master Servicer, the Trust Administrator, the Trustee or any Servicer, the
term "Relevant Servicing Criteria" may refer to a portion of the Relevant Servicing Criteria applicable
to such parties
Relief Act: The Servicemembers Civil Relief Act, as amended, and any similar state or
local law.
Relief Act Reductions: With respect to any Distribution Date and any Mortgage Loan as
to which there has been a reduction in the amount of interest collectible thereon for the most recently
ended calendar month as a result of the application of the Relief Act, the amount, if any, by which
(i) interest collectible on such Mortgage Loan for the most recently ended calendar month is less than
(ii) interest accrued thereon for such month pursuant to the Mortgage Note.
REMIC: A "real estate mortgage investment conduit," within the meaning of
Section 860D of the Code. Reference herein to REMIC refers to each REMIC created by the Preliminary
Statement.
REMIC Election: An election, for federal income tax purposes, to treat certain assets
as a REMIC.
REMIC I Available Distribution Amount: For each of Loan Group 1, Loan Group 2 and
Loan Group 3, for any Distribution Date, the Available Distribution Amount for such Loan Group.
REMIC I Distribution Amount: For any Distribution Date, the REMIC I Available
Distribution Amounts shall be deemed distributed to REMIC III, as the holder of the REMIC I Regular
Interests, and to Holders of the Class AR-L Certificates in respect of Component I thereof, pursuant to
Section 4.01(IV)(a)(i), in the following amounts and priority:
(a) To the extent of the REMIC I Available Distribution Amount for Loan Group 1:
(i) first, to Class Y-1 and Class Z-1 Regular Interests and Component I
of the Class AR-L Certificates, concurrently, the Uncertificated Accrued Interest or accrued
interest, as applicable, for such Classes remaining unpaid from previous Distribution Dates, pro
rata according to their respective shares of such unpaid amounts;
(ii) second, to the Class Y-1 and Class Z-1 Regular Interests and
Component I of the Class AR-L Certificates, concurrently, the Uncertificated Accrued Interest or
accrued interest, as applicable, for such Classes for the current Distribution Date, pro rata
according to their respective Uncertificated Accrued Interest;
(iii) third, to Component I of the Class AR-L Certificates, until the
Certificate Balance thereof has been reduced to zero; and
(iv) fourth, to the Class Y-1 and Class Z-1 Regular Interests, the
Class Y-1 Principal Distribution Amount and the Class Z-1 Principal Distribution Amount,
respectively.
(b) To the extent of the REMIC I Available Distribution Amount for Loan Group 2:
(i) first, to the Class Y-2 and Class Z-2 Regular Interests,
concurrently, the Uncertificated Accrued Interest for such Classes remaining unpaid from
previous Distribution Dates, pro rata according to their respective shares of such unpaid
amounts;
(ii) second, to the Class Y-2 and Class Z-2 Regular Interests,
concurrently, the Uncertificated Accrued Interest for such Classes for the current Distribution
Date, pro rata according to their respective Uncertificated Accrued Interest; and
(iii) third, to the Class Y-2 and Class Z-2 Regular Interests, the
Class Y-2 Principal Distribution Amount and the Class Z-2 Principal Distribution Amount,
respectively.
(c) To the extent of the REMIC I Available Distribution Amount for Loan Group 3:
(i) first, to the Class Y-3 and Class Z-3 Regular Interests,
concurrently, the Uncertificated Accrued Interest for such Classes remaining unpaid from
previous Distribution Dates, pro rata according to their respective shares of such unpaid
amounts;
(ii) second, to the Class Y-3 and Class Z-3 Regular Interests,
concurrently, the Uncertificated Accrued Interest for such Classes for the current Distribution
Date, pro rata according to their respective Uncertificated Accrued Interest; and
(iii) third, to the Class Y-3 and Class Z-3 Regular Interests, the
Class Y-3 Principal Distribution Amount and the Class Z-3 Principal Distribution Amount,
respectively.
(f) To the extent of the REMIC I Available Distribution Amounts for such
Distribution Date remaining after payment of the amounts pursuant to paragraphs (a) through (e) of this
definition of "REMIC I Distribution Amount":
(i) first, to each Class of REMIC I Class Y and Class Z Regular
Interests, pro rata according to the amount of unreimbursed Realized Losses allocable to
principal previously allocated to each such Class; provided, however, that any amounts
distributed pursuant to this paragraph (f)(i) of this definition of "REMIC I Distribution
Amount" shall not cause a reduction in the Uncertificated Principal Balances of any of the
Class Y and Class Z Regular Interests; and
(ii) second, to the Class AR-L Certificates in respect of Component I
thereof, any remaining amount.
REMIC I Realized Losses: Realized Losses on the Group 1, Group 2 and Group 3 Mortgage
Loans shall be allocated to the REMIC I Regular Interests as follows: (1) the interest portion of
Realized Losses and Net Interest Shortfalls on the Group 1 Loans, if any, shall be allocated between the
Class Y-1 and Class Z-1 Regular Interests pro rata according to the amount of interest accrued but
unpaid thereon, in reduction thereof; (2) the interest portion of Realized Losses and Net Interest
Shortfalls on the Group 2 Loans, if any, shall be allocated between the Class Y-2 and Class Z-2 Regular
Interests pro rata according to the amount of interest accrued but unpaid thereon, in reduction thereof;
and (3) the interest portion of Realized Losses and Net Interest Shortfalls on the Group 3 Loans, if
any, shall be allocated between the Class Y-3 and Class Z-3 Regular Interests pro rata according to the
amount of interest accrued but unpaid thereon, in reduction thereof. Any interest portion of such
Realized Losses in excess of the amount allocated pursuant to the preceding sentence shall be treated as
a principal portion of Realized Losses not attributable to any specific Mortgage Loan in such Group and
allocated pursuant to the succeeding sentences. The principal portion of Realized Losses with respect
to the Group 1, Group 2 and Group 3 Mortgage Loans shall be allocated to the REMIC I Regular Interests
as follows: (1) the principal portion of Realized Losses on the Group 1 Loans shall be allocated, first,
to the Class Y-1 Regular Interest to the extent of the Class Y-1 Principal Reduction Amount in reduction
of the Uncertificated Principal Balance of such Regular Interest and, second, the remainder, if any, of
such principal portion of such Realized Losses shall be allocated to the Class Z-1 Regular Interest in
reduction of the Uncertificated Principal Balance thereof; (2) the principal portion of Realized Losses
on the Group 2 Loans shall be allocated, first, to the Class Y-2 Regular Interest to the extent of the
Class Y-2 Principal Reduction Amount in reduction of the Uncertificated Principal Balance of such
Regular Interest and, second, the remainder, if any, of such principal portion of such Realized Losses
shall be allocated to the Class Z-2 Regular Interest in reduction of the Uncertificated Principal
Balance thereof; and (3) the principal portion of Realized Losses on the Group 3 Loans shall be
allocated, first, to the Class Y-3 Regular Interest to the extent of the Class Y-3 Principal Reduction
Amount in reduction of the Uncertificated Principal Balance of such Regular Interest and, second, the
remainder, if any, of such principal portion of such Realized Losses shall be allocated to the Class Z-3
Regular Interest in reduction of the Uncertificated Principal Balance thereof. For any Distribution
Date, reductions in the Uncertificated Principal Balances of the Class Y and Class Z Regular Interests
pursuant to this definition of Realized Loss shall be determined, and shall be deemed to occur, prior to
any reductions of such Uncertificated Principal Balances by distributions on such Distribution Date.
REMIC II Available Distribution Amount: The sum of the Interest Remittance Amount and
the Principal Remittance Amount.
REMIC II Distribution Amount: For any Distribution Date, the REMIC II Available
Distribution Amount shall be deemed distributed to REMIC III, as the holder of the REMIC II Regular
Interests, and to Holders of the Class AR-L Certificates in respect of Component II thereof, pursuant to
Section 4.01(IV)(a)(ii), in the following amounts and priority:
(a) first, to the REMIC II Regular Interests, pro rata, in an amount equal to (A)
their Uncertificated Accrued Interest for such Distribution Date, plus (B) any amounts in respect
thereof remaining unpaid from previous Distribution Dates;
(b) second:
(i) to REMIC II Regular Interests LT2, LT3 and LT4, their respective
Principal Distribution Amounts;
(ii) to REMIC II Regular Interest LT1 its Principal Distribution Amount;
(iii) any remainder to REMIC II Regular Interest LT1, until the
Uncertificated Principal Balance thereof has been reduced to zero;
(iv) any remainder to REMIC II Regular Interests LT2, LT3 and LT4, pro
rata, according to their respective Uncertificated Principal Balances as reduced by the
distributions made pursuant to (i) above, until their respective Uncertificated Principal
Balances have been reduced to zero;
(c) third, to the extent of the REMIC II Available Distribution Amount for such
Distribution Date remaining after payment of the amounts pursuant to paragraphs (a) and (b) of this
definition of "REMIC II Distribution Amount" as follows:
(i) first, to the REMIC II Regular Interests, pro rata, to the extent of
any Realized Losses allocated to such REMIC II Regular Interests on such Distribution Date or
any prior Distribution Date and not previously reimbursed pursuant to this paragraph; provided,
however, that any amounts distributed pursuant to this paragraph (c)(i) of this definition of
"REMIC II Distribution Amount" shall not cause a reduction in the Uncertificated Principal
Balance of any of the REMIC II Regular Interests; and
(ii) second, to the Class AR-L Certificates in respect of Component II
thereof, any remaining amount.
REMIC II Principal Reduction Amounts: For any Distribution Date, the amounts by which
the Uncertificated Principal Balances of the REMIC II Regular Interests will be reduced on such
Distribution Date by the allocation of Realized Losses and the distribution of principal, determined as
follows:
For purposes of the succeeding formulas the following symbols shall have the meanings set forth
below:
Y1 = the Uncertificated Principal Balance of REMIC II Regular Interest LT1 after
distributions on the prior Distribution Date.
Y2 = the Uncertificated Principal Balance of REMIC II Regular Interest LT2 after
distributions on the prior Distribution Date.
Y3 = the Uncertificated Principal Balance of REMIC II Regular Interest LT3 after
distributions on the prior Distribution Date.
Y4 = the Uncertificated Principal Balance of REMIC II Regular Interest LT4 after
distributions on the prior Distribution Date (note: Y3 = Y4).
ΔY1 = the REMIC II Regular Interest LT1 Principal Reduction Amount.
ΔY2 = the REMIC II Regular Interest LT2 Principal Reduction Amount.
ΔY3 = the REMIC II Regular Interest LT3 Principal Reduction Amount.
ΔY4 = the REMIC II Regular Interest LT4 Principal Reduction Amount.
P0 = the aggregate Uncertificated Principal Balance of the REMIC II Regular Interests after
distributions and the allocation of Realized Losses on the prior Distribution Date.
P1 = the aggregate Uncertificated Principal Balance of the REMIC II Regular Interests after
distributions and the allocation of Realized Losses to be made on such Distribution Date.
ΔP = P0 - P1 = the aggregate of the REMIC II Regular Interests LT1, LT2, LT3 and LT4
Principal Reduction Amounts.
= the aggregate of the principal portions of Realized Losses to be allocated to, and the
principal distributions to be made on, the Group 4 Certificates on such Distribution Date (including
distributions of accrued and unpaid interest on the Class 4-X Certificates for prior Distribution Dates).
R0 = the Net Funds Cap (stated as a monthly rate) after giving effect to amounts
distributed and Realized Losses allocated on the prior Distribution Date.
R1 = the Net Funds Cap (stated as a monthly rate) after giving effect to amounts to be
distributed and Realized Losses to be allocated on such Distribution Date.
α = (Y2 + Y3)/P0. The initial value of α on the Closing Date for use on the first
Distribution Date shall be 0.0001.
γ0 = the lesser of (A) the sum for all Classes of LIBOR Certificates of the product for
each Class of (i) the lesser of (x) the monthly interest rate for such Class and (y) the Net Funds
Cap applicable for distributions to be made on such Distribution Date and (ii) the aggregate Certificate
Principal Balance for such Class after distributions and the allocation of Realized Losses on the prior
Distribution Date and (B) R0*P0.
γ1 = the lesser of (A) the sum for all Classes of LIBOR Certificates of the product for
each Class of (i) the lesser of (x) the monthly interest rate for such Class and (y) the Net Funds
Cap applicable for distributions to be made on the next succeeding Distribution Date and (ii) the
aggregate Certificate Principal Balance for such Class after distributions and the allocation of
Realized Losses to be made on such Distribution Date and (B) R1*P1.
Then, based on the foregoing definitions:
ΔY1 = ΔP - ΔY2 - ΔY3 - ΔY4;
ΔY2 = (α/2){( γ0R1 - γ1R0)/R0R1};
ΔY3 = αΔP - ΔY2; and
ΔY4 = ΔY3.
if both ΔY2 and ΔY3, as so determined, are non-negative numbers. Otherwise:
(1) If ΔY2, as so determined, is negative, then
ΔY2 = 0;
ΔY3 = α{γ1R0P0 - γ0R1P1}/{γ1R0};
ΔY4 = ΔY3; and
ΔY1 = ΔP - ΔY2 - ΔY3 - ΔY4.
(2) If ΔY3, as so determined, is negative, then
ΔY3 = 0;
ΔY2 = α{γ1R0P0 - γ0R1P1}/{2R1R0P1 - γ1R0};
ΔY4 = ΔY3; and
ΔY1 = ΔP - ΔY2 - ΔY3 - ΔY4.
The Principal Reduction Amount ΔY1 shall be allocated to REMIC II Regular Interest LT1.
REMIC II Realized Losses: Realized Losses on the Group 4 Mortgage Loans for the
related Collection Period shall be allocated to REMIC II Regular Interests LT1, LT2, LT3 and LT4, in
reduction of the Uncertificated Principal Balances thereof and interest accrued thereon, as follows:
(i) the interest portion of Realized Losses, if any, shall be allocated pro rata to accrued interest on
REMIC II Regular Interests LT1, LT2, LT3 and LT4, to the extent of such accrued interest, and (ii) any
remaining interest portions of Realized Losses and any principal portions of Realized Losses shall be
treated as principal portions of Realized Losses and allocated (i) to REMIC II Regular Interest LT2,
REMIC II Regular Interest LT3 and REMIC II Regular Interest LT4, pro rata according to their respective
Principal Reduction Amounts, provided that such allocation to each of REMIC II Regular Interest LT2,
REMIC II Regular Interest LT3 and REMIC II Regular Interest LT4 shall not exceed their respective
Principal Reduction Amounts, and (ii) any Realized Losses not allocated to any of REMIC II Regular
Interest LT2, REMIC II Regular Interest LT3 and REMIC II Regular Interest LT4 pursuant to the provisos
of clause (i) above shall be allocated to REMIC II Regular Interest LT1, until the Uncertificated
Principal Balance thereof shall have been reduced to zero. Any Realized Losses on the Group 4 Mortgage
Loans remaining after the allocations made in the preceding sentences shall be allocated among REMIC II
Regular Interests LT2, LT3 and LT4 pro-rata according to their respective Uncertificated Principal
Balances as reduced by the allocations in the preceding sentence until such Uncertificated Principal
Balances shall have been reduced to zero.
REMIC II Regular Interest LT1 Principal Distribution Amount: For any Distribution
Date, the excess, if any, of the REMIC II Regular Interest LT1 Principal Reduction Amount for such
Distribution Date over the Realized Losses allocated to REMIC II Regular Interest LT1 on such
Distribution Date.
REMIC II Regular Interest LT2 Principal Distribution Amount: For any Distribution
Date, the excess, if any, of the REMIC II Regular Interest LT2 Principal Reduction Amount for such
Distribution Date over the Realized Losses allocated to REMIC II Regular Interest LT2 on such
Distribution Date.
REMIC II Regular Interest LT3 Principal Distribution Amount: For any Distribution
Date, the excess, if any, of the REMIC II Regular Interest LT3 Principal Reduction Amount for such
Distribution Date over the Realized Losses allocated to REMIC II Regular Interest LT3 on such
Distribution Date.
REMIC II Regular Interest LT4 Principal Distribution Amount: For any Distribution
Date, the excess, if any, of the REMIC II Regular Interest LT4 Principal Reduction Amount for such
Distribution Date over the Realized Losses allocated to REMIC II Regular Interest LT4 on such
Distribution Date.
REMIC Provisions: The provisions of the federal income tax law relating to REMICs,
which appear at Sections 860A through 860G of the Code, and related provisions and regulations
promulgated thereunder, as the foregoing may be in effect from time to time.
REMIC Regular Interest: Any of the REMIC I Regular Interests, REMIC II Regular
Interests and REMIC III Regular Interests.
REO Disposition: The final sale by Xxxxx Fargo, in its capacity as Servicer, of any
REO Property.
REO Disposition Fee: With respect to each REO Disposition, the greater of (i) $1,200
or (ii) one percent (1%) of the final sales price of such REO Disposition; provided that the real estate
broker commission with respect to the liquidation of the REO property is equal to or less than 5% except
in such cases where the property value is less than $100,000 or the property is located in a rural area
and market conditions require the Servicer to pay a real estate broker commission greater than 5% or
prior written consent has been obtained from CSFB or their authorized representative.
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.
Required Insurance Policy: With respect to any Non-Designated Mortgage Loan, any
insurance policy that is required to be maintained from time to time under this Agreement in respect of
such Mortgage Loan or the related Mortgaged Property.
Residual Certificates: The Class AR Certificates and Class AR-L Certificates.
Responsible Officer: When used with respect to the Trust Administrator, shall mean
any officer within the corporate trust department of the Trust Administrator, including any Assistant
Vice President, the Secretary, any Vice President, Assistant Secretary, the Treasurer, any Assistant
Treasurer, any Trust Officer or any other officer of the Trust Administrator customarily performing
functions similar to those performed by any of the above designated officers and any officer within the
Corporate Trust Department having direct responsibility for the administration of this Agreement. When
used with respect to the Trustee, shall mean any officer within the Corporate Trust Department having
direct responsibility for the administration of this Agreement and also, with respect to a particular
matter, any other officer to whom such matter is referred because of such officer's knowledge of and
familiarity with the particular subject.
Rolling Three Month Delinquency Rate: For any Distribution Date will be the fraction,
expressed as a percentage, equal to the average of the Delinquency Rates for each of the three (or one
and two, in the case of the first and second Distribution Dates) immediately preceding months.
Rule 144A: Rule 144A under the 1933 Act, as in effect from time to time.
S&P: Standard & Poor's Ratings Services, a division of The XxXxxx-Xxxx Companies,
Inc., or any successor thereto.
Xxxxxxxx-Xxxxx Act: The Xxxxxxxx-Xxxxx Act of 2002 and the rules and regulations of
the Commission promulgated thereunder (including any interpretations thereof by the Commission's staff).
Xxxxxxxx-Xxxxx Certification: As defined in Section 13.09.
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 pursuant to the terms of the related
Mortgage Note.
Securities Act: means the Securities Act of 1933, as amended, and the rules and
regulations thereunder.
Security Agreement: With respect to a Cooperative Loan, the agreement or mortgage
creating a security interest in favor of the originator of the Cooperative Loan in the related
Cooperative Shares.
Seller: DLJMC.
Senior Certificates: As set forth in the Preliminary Statement.
Senior Liquidation Amount: The Group 1 Senior Liquidation Amount, Group 2 Senior
Liquidation Amount or Group 3 Senior Liquidation Amount, as applicable.
Senior Percentage: The Group 1 Senior Percentage, Group 2 Senior Percentage or
Group 3 Senior Percentage, as applicable.
Senior Prepayment Percentage: The Senior Prepayment Percentage for any Distribution
Date occurring during the seven years beginning on the first Distribution Date for each of Loan Group 1,
Loan Group 2 and Loan Group 3 will equal 100%. The Senior Prepayment Percentage for any Distribution
Date occurring on or after the seventh anniversary of the first Distribution Date for each such Loan
Group will be as follows: for any Distribution Date in the first year thereafter, the related Senior
Percentage plus 70% of the related Subordinate Percentage for such Distribution Date; for any
Distribution Date in the second year thereafter, the related Senior Percentage plus 60% of the related
Subordinate Percentage for such Distribution Date; for any Distribution Date in the third year
thereafter, the related Senior Percentage plus 40% of the related Subordinate Percentage for such
Distribution Date; for any Distribution Date in the fourth year thereafter, the related Senior
Percentage plus 20% of the related Subordinate Percentage for such Distribution Date; and for any
Distribution Date after the fourth year thereafter, the related Senior Percentage for such Distribution
Date.
Notwithstanding the foregoing, on any Distribution Date and with respect to Loan
Group 1, Loan Group 2 or Loan Group 3 if the Senior Percentage exceeds the initial related Senior
Percentage, the Senior Prepayment Percentage for each Group for that Distribution Date will equal 100%,
(ii) if on or before the Distribution Date in July 2009, the Class C-B Percentage is greater than or
equal to twice the Class C-B Percentage as of the Closing Date, in which case the Senior Prepayment
Percentage for each Group will equal the related Senior Percentage, plus 50% of the related Subordinate
Percentage for that Distribution Date, and if after the Distribution Date in July 2009, the Class C-B
Percentage is greater than or equal to twice the Class C-B Percentage as of the Closing Date, then the
Senior Prepayment Percentage for each such Group for such Distribution Date will equal the related
Senior Percentage).
Notwithstanding the foregoing, the Senior Prepayment Percentage for any of Loan
Group 1, Loan Group 2 or Loan Group 3 shall equal 100% for any Distribution Date as to which (i) the
outstanding principal balance of the Mortgage Loans in the related Loan Group, delinquent 60 days or
more (including all REO Properties and Mortgage Loans in foreclosure) (averaged over the preceding six
month period), as a percentage of the related aggregate Subordinate Component Balance as of such
Distribution Date is equal to or greater than 50% or (ii) cumulative Realized Losses for the Mortgage
Loans in the related Loan Group exceed (a) with respect to any Distribution Date prior to the third
anniversary of the first Distribution Date, 20% of the related aggregate Subordinate Component Balance
as of the Closing Date (the "Original Subordinate Principal Balance"), (b) with respect to any
Distribution Date on or after the third anniversary but prior to the eighth anniversary of the first
Distribution Date, 30% of the related Original Subordinate Principal Balance, (c) with respect to any
Distribution Date on or after the eighth anniversary but prior to the ninth anniversary of the first
Distribution Date, 35% of the related Original Subordinate Principal Balance, (d) with respect to any
Distribution Date on or after the ninth anniversary but prior to the tenth anniversary of the first
Distribution Date, 40% of the related Original Subordinate Principal Balance, (e) with respect to any
Distribution Date on or after the tenth anniversary but prior to the eleventh anniversary of the first
Distribution Date, 45% of the related Original Subordinate Principal Balance and (f) with respect to any
Distribution Date on or after the eleventh anniversary of the first Distribution Date, 50% of the
Original Subordinate Principal Balance.
If the Senior Prepayment Percentage for one Loan Group equals 100% due to the
limitations set forth above, then the Senior Prepayment Percentage for the other Loan Groups will equal
100%.
If on any Distribution Date the allocation to a Class of Senior Certificates then
entitled to distributions of Principal Prepayments and other amounts in the percentage required above
would reduce the outstanding Class Principal Balance of that Class below zero, the distribution to that
Class of Senior Certificates of the Senior Prepayment Percentage of those amounts for such Distribution
Date shall be limited to the percentage necessary to reduce the related Class Principal Balance to zero.
Senior Principal Distribution Amount: The Group 1 Senior Principal Distribution
Amount, Group 2 Senior Principal Distribution Amount or Group 3 Senior Principal Distribution Amount, as
applicable.
Servicer Employee: As defined in Section 3.16.
Service(s)(ing): In accordance with Regulation AB, the act of servicing and
administering the Mortgage Loans or any other assets of the Trust by an entity that meets the definition
of "servicer' set forth in Item 1101 of Regulation AB and is subject to the disclosure requirements set
forth in 1108 of Regulation AB. For clarification purposes, any uncapitalized occurrence of this term
shall have the meaning commonly understood by participants in the residential mortgage-backed
securitization market.
Servicer Mortgage File: All documents pertaining to a Mortgage Loan not required to
be included in the Trustee Mortgage File and held by the Master Servicer or the related Servicer or any
Sub-Servicer.
Servicers: SPS, GreenPoint, Xxxxx Fargo and the Special Servicer to the extent it has
taken over the servicing of one or more Mortgage Loans pursuant to Section 3.17 and, in each case, any
successor in interest thereto or any successor servicer appointed as provided herein.
Servicing Advance: With respect to the Non-Designated Mortgage Loans, all customary,
reasonable and necessary "out of pocket" costs and expenses incurred prior to, on or after the Cut-off
Date in the performance by a Servicer of its servicing obligations related to such Mortgage Loans,
including, but not limited to, the cost (including reasonable attorneys' fees and disbursements) of
(i) the preservation, restoration and protection of a Mortgaged Property, (ii) compliance with the
obligations under Section 3.11 and any enforcement or judicial proceedings, including foreclosures,
(iii) the management and liquidation of any REO Property (including default management and similar
services, appraisal services and real estate broker services), (iv) any expenses incurred by a Servicer
in connection with obtaining an environmental inspection or review pursuant to the second paragraph of
Section 3.11(a), (v) compliance with the obligations under Section 3.09, (vi) locating any documents
missing from the Trustee's Mortgage File and (vii) obtaining broker price opinions. In no event shall
any Servicer be required to make any Servicing Advance which would constitute a Nonrecoverable Advance.
With respect to the Designated Mortgage Loans, Servicing Advance shall have the
meaning assigned to such term in the related Designated Servicing Agreement.
Servicing Criteria: The "servicing criteria" set forth in Item 1122(d) of Regulation
AB, as such may be amended from time to time.
Servicing Fee: As to each Mortgage Loan and any Distribution Date, an amount equal to
one month's interest at the Servicing Fee Rate on the Stated Principal Balance of such Mortgage Loan as
of the Due Date in the month of such Distribution Date (prior to giving effect to any Scheduled Payments
due on such Mortgage Loan on such Due Date), subject to reduction as provided in Section 3.14.
Servicing Fee Rate: As to each Mortgage Loan, the per annum rate set forth on the
Mortgage Loan Schedule.
Servicing Function Participant: Any Servicer, the Master Servicer or the Trust
Administrator and any Sub-Servicer, Subcontractor or any other Person (other than the Trustee)
contracted by a Servicer, the Master Servicer or the Trust Administrator that is performing activities
addressed by the Servicing Criteria, unless, with respect to any Sub-Servicer, Subcontractor or other
Person contracted by a Servicer, the Master Servicer or the Trust Administrator, such Person's
activities relate only to 5% or less of the Mortgage Loans (measured by aggregate Stated Principal
Balance of the Mortgage Loans, annually at the commencement of the calendar year prior to the year in
which an Assessment of Compliance is required to be delivered, multiplied by a fraction, the numerator
of which is the number of months during which such Servicing Function Participant Services the related
Mortgage Loans and the denominator of which is 12, or, in the case of the year in which the Closing Date
occurs, the number of months elapsed from the Cut-off Date to the end of such calendar year).
Servicing Officer: Any officer of a Servicer involved in, or responsible for, the
administration and servicing of the related Mortgage Loans whose name and specimen signature appear on a
list of servicing officers furnished to the Trustee and the Trust Administrator by a Servicer on the
Closing Date pursuant to this Agreement, as such list may from time to time be amended and delivered to
the Trustee and Trust Administrator.
Special Hazard Loss: A Realized Loss (or portion thereof) with respect to a Mortgage
Loan arising from any direct physical loss or damage to a Mortgaged Property (including any Realized
Loss due to the presence or suspected presence of hazardous wastes or substances on mortgaged property)
which is not covered by a standard hazard maintenance policy with extended coverage or by a flood
insurance policy, if applicable (or which would not have been covered by such a policy had such a policy
been maintained), which is caused by or results from any cause except: (i) wear and tear, deterioration,
rust or corrosion, mold, wet or dry rot, inherent vice or latent defect, animals, birds, vermin,
insects; (ii) settling, subsidence, cracking, shrinkage, bulging or expansion of pavements, foundations,
walls, floors, roofs or ceilings; (iii) errors in design, faulty workmanship or faulty materials, unless
the collapse of the property or part thereof ensues and then only for the ensuing loss; (iv) nuclear or
chemical reaction or nuclear radiation or radioactive or chemical contamination, all whether controlled
or uncontrolled, and whether such loss be direct or indirect, proximate or remote; (v) hostile or
warlike action in time of peace or war, including action in hindering, combating or defending against an
actual, impending or expected attack (a) by any government of sovereign power, de jure or de facto, or
by any authority maintaining or using military, naval or air forces, (b) by military, naval or air
forces, or (c) by an agent of any such government, power, authority or forces; (vi) any weapon of war
employing atomic fission or radioactive force whether in time of peace or war; or (vii) insurrection,
rebellion, revolution, civil war, usurped power or action taken by governmental authority in hindering,
combating or defending against such occurrence, seizure or destruction under quarantine or customs
regulations, confiscation by order of any government or public authority, or risks of contraband or
illegal transportation or trade.
Special Hazard Loss Coverage Amount: With respect to the Class C-B Certificates, as of
the Closing Date, $5,425,000 subject in each case to reduction from time to time, to be an amount equal
on any Distribution Date to the lesser of (a) the greatest of (i) 1% of the Aggregate Groups 1-3
Collateral Balance, (ii) twice the principal balance of the largest Mortgage Loan in Loan Group 1, Loan
Group 2 and Loan Group 3 and (iii) the aggregate Stated Principal Balances of the Group 1, Group 2 or
Group 3 Mortgage Loans secured by Mortgaged Properties located in the single California postal zip code
area having the highest aggregate principal balance of any such zip code area and (b) the Special Hazard
Loss Coverage Amount as of the Closing Date less the amount, if any, of losses attributable to Special
Hazard Losses allocated to the Class C-B Certificates since the Closing Date. All Stated Principal
Balances for the purpose of this definition will be calculated as of the first day of the month
preceding such Distribution Date after giving effect to scheduled installments of principal and interest
on the Mortgage Loans then due, whether or not paid. The Special Hazard Loss Coverage Amount may be
reduced below the amount set forth above for any Distribution Date with the consent of the Rating
Agencies as evidenced by a letter of each Rating Agency to the Trust Administrator to the effect that
any such reduction will not result in a downgrading of the current ratings assigned to such Classes of
Certificates rated by it.
Special Hazard Loss Coverage Termination Date: The date on which the Special Hazard
Loss Coverage Amount has been reduced to zero.
Special Servicer: SPS, and its successors and permitted assigns.
Special Serviced Mortgage Loan: The Mortgage Loans for which the Special Servicer
acts as servicer pursuant to Section 3.17.
SPS: Select Portfolio Servicing, Inc., a Utah corporation, and its successors and
assigns.
SPS Mortgage Loans: Any SPS Serviced Mortgage Loans for which SPS has not entered
into a subservicing arrangement for such Mortgage Loan pursuant to Section 3.02 hereof.
SPS Serviced Mortgage Loans: The Mortgage Loans identified as such on the Mortgage
Loan Schedule for which SPS is the applicable Servicer or the Special Servicer.
Standard Hazard Policy: Each standard hazard insurance policy or replacement therefor
referred to in Section 3.09.
Startup Day: The Closing Date.
Stated Principal Balance: With respect to any Mortgage Loan and date of
determination, the principal balance of such Mortgage Loan as of the Cut-off Date, after application of
the principal portion of all Scheduled Payments due on or before the Cut-off Date, whether or not
received, increased by the portion of any Capitalization Reimbursement Amount allocable to such Mortgage
Loan, minus the sum of (i) all amounts allocable to principal that have been distributed to
Certificateholders with respect to such Mortgage Loan on or before that date of determination and (ii)
any Realized Losses on such Mortgage Loan that have been allocated to one or more Classes of
Certificates on or before that date of determination.
Stepdown Date: The date occurring on the earlier of (a) the first Distribution Date
following the Distribution Date on which the aggregate Class Principal Balance of the Group 4 Senior
Certificates is reduced to zero and (b) the later of (x) the Distribution Date in August 2009 and
(y) the first Distribution Date on which the Group 4 Senior Enhancement Percentage (calculated for this
purpose after giving effect to payments or other recoveries in respect of the Mortgage Loans in Loan
Group 4 during the related Collection Period but before giving effect to payments on the Group 4
Certificates on such Distribution Date) is greater than or equal to 16.60%.
Stock Power: With respect to a Cooperative Loan, an assignment of the stock
certificate or an assignment of the Cooperative Shares issued by the Cooperative Corporation.
Streamlined Mortgage Loan: A Mortgage Loan originated in connection with the
refinance of a mortgage loan pursuant to the Seller's streamlined documentation program then in effect.
Subcontractor: Any vendor, subcontractor or other Person that is not responsible for
the overall servicing 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 any
Servicer (or a Sub-Servicer of any Servicer), the Master Servicer or the Trust Administrator.
Subordinate Certificates: As set forth in the Preliminary Statement.
Subordinate Component Balance: For any of Loan Group 1, Loan Group 2 and Loan
Group 3, as of any date of determination, the Aggregate Loan Group Balance of such Loan Group as of such
date of determination, minus the sum of the then outstanding aggregate Class Principal Balance of the
related Classes of Class A Certificates.
Subordinate Liquidation Amount: For any Distribution Date and any of Loan Group 1,
Loan Group 2 or Loan Group 3 the excess, if any, of the aggregate Liquidation Principal of all Mortgage
Loans in that Loan Group which became Liquidated Mortgage Loans during the calendar month preceding the
Distribution Date over the Group 1 Senior Liquidation Amount, Group 2 Senior Liquidation Amount or
Group 3 Senior Liquidation Amount, as applicable, for such Distribution Date.
Subordinate Percentage: With respect to any Distribution Date and Loan Group 1, Loan
Group 2 or Loan Group 3, the excess of 100% over the related Senior Percentage for that Distribution
Date.
Subordinate Prepayment Percentage: With respect to any Distribution Date and with
respect to Loan Group 1, Loan Group 2 or Loan Group 3, 100% minus the related Senior Prepayment
Percentage for such Distribution Date; provided, however, that if the aggregate Class Principal Balance
of the Senior Certificates related to such Loan Group has been reduced to zero, then the Subordinate
Prepayment Percentage for such Loan Group will equal 100%.
Subordinate Principal Distribution Amount: With respect to any Distribution Date, the
sum of the following amounts for each of Loan Group 1, Loan Group 2 or Loan Group 3: (i) the related
Subordinate Percentage of the related Principal Payment Amount, (ii) the related Subordinate Prepayment
Percentage of the related Principal Prepayment Amount, and (iii) the related Subordinate Liquidation
Amount; less the amount of certain cross-collateralization payments as made pursuant to Section 4.07.
Subordination Level: With respect to any Distribution Date and any Class of Class C-B
Certificates, the percentage obtained by dividing the sum of the Class Principal Balances of all Classes
of Class C-B Certificates which are subordinate in right of payment to such Class by the sum of the
Class Principal Balances of the Group 1, Group 2 and Group 3 and Class C-B Certificates, in each case
immediately prior to such Distribution Date.
Sub-Servicer: Any Person that (i) services Mortgage Loans on behalf of any Servicer,
and (ii) is responsible for the performance (whether directly or through sub-servicers or
Subcontractors) of Servicing functions required to be performed under this Agreement, any related
Designated Servicing Agreement or any sub-servicing agreement that are identified in Item 1122(d) of
Regulation AB.
Subservicing Agreement: An agreement between a Servicer and a Sub-Servicer for the
servicing of the related Mortgage Loans.
Substitution Adjustment Amount: As defined in Section 2.03.
Supplemental Interest Account: As defined in Section 4.09 hereof. The Supplemental
Interest Account will not be an asset of any REMIC.
Supplemental Interest Trust: The trust created pursuant to Section 4.09 herein and
designated as the "Supplemental Interest Trust," consisting of the Swap Agreement, the Supplemental
Interest Account and the right to receive Net Swap Payments from the Swap Counterparty.
Supplemental Interest Trust Trustee: The Trust Administrator, acting not in its
individual capacity but solely as trustee of the Supplemental Interest Trust.
Supplemental Trust Payment: An amount equal to the Swap Fee Amount for such Swap
Payment Date.
Swap Agreement: The swap agreement relating to the Class 4-A-2 Certificates
consisting of ISDA Master Agreement (Multicurrency Cross-Border), a schedule, credit support annex and
the related confirmation thereto, each dated as of the Closing Date, between the Supplemental Interest
Trust Trustee and the Swap Counterparty, as such agreement may be amended and supplemented in accordance
with its terms.
Swap Calculation Period: Each period from and including the Distribution Date in the
preceding calendar month to, but excluding, the related Distribution Date, except that the initial Swap
Calculation Period will commence on, and include, July 31, 2006 and the final Swap Calculation Period
will end on, but exclude, the Swap Termination Date, provided that such Swap Calculation Period shall be
adjusted pursuant to the "Following Business Day Convention" (as defined in the Class 4-A-2 Swap
Agreement).
Swap Counterparty: Credit Suisse International and its successors.
Swap Counterparty Payment: An amount equal to the greater of (I) zero and (II) the
product of (a) the Formula Rate for the Class 4-A-2 Certificates for the related Distribution Date minus
the excess of (1) the Net Funds Cap for such Distribution Date over the (2) the Swap Fee Rate, (b) a
fraction, the numerator of which is the actual number of days elapsed in the related Swap Calculation
Period and the denominator of which is 360 and (c) the Swap Notional Amount.
Swap Counterparty Reimbursement Amount: With respect to any Distribution Date or Swap
Payment Date, an amount equal to the sum of (1) the amount of any Swap Counterparty Payment for such
date, minus the amount of any Swap Fee Reimbursement Amount or portion thereof paid to the Swap
Counterparty on such date, (2) any amount described in clause (1) remaining unpaid from prior
Distribution Dates and Swap Payment Dates and (3) interest on the amount in clause (2) for the related
Accrual Period calculated on the basis of One-Month LIBOR plus the Certificate Margin for the
Class 4-A-2 Certificates.
Swap Counterparty Trigger Event: (i) an Event of Default (as defined in the Swap
Agreement) with respect to which the Swap Counterparty is a Defaulting Party (as defined in the Swap
Agreement), (ii) a Termination Event (as defined in the Swap Agreement) under the Swap Agreement with
respect to which the Swap Counterparty is the sole Affected Party (as defined in the Swap Agreement) or
(iii) an Additional Termination Event (as defined in the Swap Agreement) under the Swap Agreement with
respect to which the Swap Counterparty is the sole Affected Party.
Swap Event of Default: An "Event of Default" as such term is defined in the Swap
Agreement.
Swap Fee Amount: An amount equal to the product of (a) the Swap Fee Rate, (b) a
fraction, the numerator of which is the actual number of days elapsed in the related Swap Calculation
Period and the denominator of which is 360 and (c) the Swap Notional Amount.
Swap Fee Reimbursement Amount: With respect to any Swap Payment Date, an amount equal
to the Swap Fee Amount for such Swap Payment Date minus the amount of the Net Swap Payment paid by the
Supplemental Interest Trust for such Swap Payment Date.
Swap Fee Rate: As defined in the Swap Agreement.
Swap Notional Amount: With respect to the Swap Agreement and each Swap Payment Date,
an amount equal to the lesser of (1) the aggregate Class Principal Balance of the Class 4-A-2
Certificates for the immediately preceding Distribution Date after giving effect to distributions on
such Distribution Date (or as of the Closing Date for the first Distribution Date) and (2) the Aggregate
Loan Group Balance for Loan Group 4 for the related Distribution Date; provided, that the Swap Notional
Amount with respect to the initial Swap Payment Date will be equal to $290,000,000.
Swap Payment Date: The "Business Day" (as defined in the Swap Agreement) before each
Distribution Date.
Swap Suspension Event: With respect to any Distribution Date, either (a) the
occurrence of a default by the Swap Counterparty under the Swap Agreement in the timely payment of any
Net Swap Payment owed by the Swap Counterparty to the Supplemental Interest Trust on the related Swap
Payment Date or (b) the Swap Agreement has been terminated and no replacement Swap Agreement is in force
and effect.
Swap Termination Date: Immediately following the earliest to occur of (a) the
Maturity Date, (b) the date on which the Terminating Entity has purchased all of the Group 4 Mortgage
Loans from the Trust, unless terminated earlier in accordance with the terms of the Swap Agreement and
(c) the Distribution Date on which the Class Principal Balance of the Class 4-A-2 Certificates has been
reduced to zero.
Swap Termination Payment: Upon the designation of an Early Termination Date (as
defined in the Swap Agreement), the payment to be made by the Trust to the Supplemental Interest Account
for payment to the Swap Counterparty, or by the Swap Counterparty to the Supplemental Interest Account
for payment to the Trust, as applicable, pursuant to the terms of the Swap Agreement.
Targeted Overcollateralization Amount: For any Distribution Date prior to the
Stepdown Date, 1.55% of the Aggregate Loan Group Balance for Loan Group 4 as of the Cut-off Date; with
respect to any Distribution Date on or after the Stepdown Date and with respect to which a Trigger Event
is not in effect, the greater of (a) 3.10% of the Aggregate Loan Group Balance for Loan Group 4 for such
Distribution Date, or (b) 0.50% of the Aggregate Loan Group Balance for Loan Group 4 as of the Cut-off
Date; with respect to any Distribution Date on or after the Stepdown Date with respect to which a
Trigger Event has occurred and is continuing, the Targeted Overcollateralization Amount for the
Distribution Date immediately preceding such Distribution Date.
Tax Matters Person: The person designated as "tax matters person" in the manner
provided under Treasury regulation § 1.860F 4(d) and temporary Treasury regulation § 301.6231(a)(7)1T.
Initially, the Tax Matters Person shall be the Trust Administrator.
Telerate Page 3750: The display designated as page 3750 on Bridge Telerate Service
(or such other page as may replace page 3750 on that service for the purpose of displaying London
interbank offered rates of major banks).
Terminating Auction Date: With respect to Loan Group 1, Loan Group 2 and Loan
Group 3, as defined in Section 11.01(d) and with respect to Loan Group 4, as defined in Section 11.01(e).
Terminating Auction Purchaser: With respect to Loan Group 1, Loan Group 2 and Loan
Group 3, as defined in Section 11.01(d) and with respect to Loan Group 4, as defined in Section 11.01(e).
Terminating Auction Sale: With respect to Loan Group 1, Loan Group 2 and Loan
Group 3, as defined in Section 11.01(d) and with respect to Loan Group 4, as defined in Section 11.01(e).
Terminating Entity: The entity determined by the Trust Administrator pursuant to
Section 11.02 of this Agreement.
Transferring Servicer: As defined in Section 3.17 hereof.
Transferee Affidavit and Agreement: As defined in Section 6.02(g)(i)(B).
Trigger Event: A Trigger Event will occur for any Distribution Date if either (i) the
Rolling Three Month Delinquency Rate as of the last day of the related Collection Period equals or
exceeds 34.00% of the Group 4 Senior Enhancement Percentage for such Distribution Date or (ii) the
cumulative Realized Losses as a percentage of the Aggregate Loan Group Balance for Loan Group 4 on the
Closing Date for such Distribution Date is greater than the percentage set forth in the following table:
--------------------------------------------- -----------------------------------------------
Range of Distribution Dates Cumulative Loss Percentage
--------------------------------------------- -----------------------------------------------
August 2008 - July 2009 0.25%*
--------------------------------------------- -----------------------------------------------
August 2009 - July 2010 0.70%*
--------------------------------------------- -----------------------------------------------
August 2010 - July 2011 1.20%*
--------------------------------------------- -----------------------------------------------
August 2011 - July 2012 1.70%*
--------------------------------------------- -----------------------------------------------
August 2012 and thereafter 2.00%*
--------------------------------------------- -----------------------------------------------
* The cumulative loss percentages set forth above are applicable to the first
Distribution Date in the corresponding range of Distribution Dates. The
cumulative loss percentage for each succeeding Distribution Date in a range
increases incrementally by 1/12 of the positive difference between the
percentage applicable to the first Distribution Date in that range and the
percentage applicable to the first Distribution Date in the succeeding range.
Trust: The trust created pursuant to Section 2.01 this Agreement.
Trust Administrator: Xxxxx Fargo Bank, N.A., a national banking association, not in
its individual capacity, but solely in its capacity as trust administrator for the benefit of the
Certificateholders under this Agreement, and any successor thereto, as provided herein.
Trust Administrator Fee: As set forth in Section 10.05.
Trust Administrator Fee Rate: As to each Mortgage Loan, a per annum rate equal to
0.00%.
Trust Collateral: With respect to Loan Group 1, Loan Group 2 and Loan Group 3, as
defined in Section 11.01(c)(i) and with respect to Loan Group 4, as defined in Section 11.01(c)(ii).
Trust Fund: The corpus of the Trust created by this Agreement consisting of (a) the
Mortgage Loans, including all interest and principal received or receivable by the Depositor on or with
respect to the Mortgage Loans after the Cut-off Date, but not including payments of principal and
interest due and payable on the Mortgage Loans on or before the Cut-off Date, together with the Mortgage
Files relating to the Mortgage Loans, (b) REO Property, (c) the Collection Account, the Certificate
Account, the Group 4 Interest Rate Cap Accounts, the Supplemental Interest Account and all amounts
deposited therein pursuant to the applicable provisions of this Agreement, (d) any insurance policies
with respect to the Mortgage Loans, (e) the Depositor's rights under the Assignment and Assumption
Agreement, (f) the Trust's rights under the Group 4 Interest Rate Cap Agreements and the Swap Agreement,
and (g) all proceeds of the conversion, voluntary or involuntary, of any of the foregoing into cash or
other liquid property.
Trust Receipt and Final Certification: As defined in Section 2.02(a).
Trust Receipt and Initial Certification: As defined in Section 2.02(a).
Trustee: U.S. Bank National Association, a national banking association, not in its
individual capacity, but solely in its capacity as trustee for the benefit of the Certificateholders
under this Agreement, and any successor thereto, as provided herein.
Trustee Mortgage File: The mortgage documents listed in Section 2.01 hereof
pertaining to a particular Mortgage Loan and any additional documents required to be added to the
Trustee Mortgage File pursuant to this Agreement.
Uncertificated Accrued Interest: With respect to any Uncertificated Regular Interest
for any Distribution Date, one month's interest at the related Uncertificated Pass-Through Rate for such
Distribution Date, accrued on the Uncertificated Principal Balance or Uncertificated Notional Amount, as
applicable, immediately prior to such Distribution Date. Uncertificated Accrued Interest for the
Uncertificated Regular Interests shall accrue on the basis of a 360-day year consisting of twelve 30-day
months. For purposes of calculating the amount of Uncertificated Accrued Interest for the REMIC I
Regular Interests for any Distribution Date, any Prepayment Interest Shortfalls (to the extent not
covered by Compensating Interest Payments) relating to the Group 1, Group 2 and Group 3 Mortgage Loans
for any Distribution Date shall be allocated among the REMIC I Regular Interests, pro rata, based on,
and to the extent of, Uncertificated Accrued Interest, as calculated without application of this
sentence. For purposes of calculating the amount of Uncertificated Accrued Interest for the REMIC II
Regular Interests for any Distribution Date, any Prepayment Interest Shortfalls (to the extent not
covered by Compensating Interest Payments) relating to the Group 4 Mortgage Loans for any Distribution
Date shall be allocated among the REMIC II Regular Interests, pro rata, based on, and to the extent of,
Uncertificated Accrued Interest, as calculated without application of this sentence. REMIC III Regular
Interest 4-X-PO shall bear no interest. Accrued interest on REMIC III Regular Interest 4-X-IO for each
Distribution Date shall equal accrued Current Interest for the Class 4-X Certificates.
Uncertificated Pass-Through Rate: For any REMIC I Regular Interest or REMIC II
Regular Interest, the per annum rate set forth or calculated in the manner described in the Preliminary
Statement under "REMIC I" or "REMIC II," respectively.
Uncertificated Principal Balance: The principal amount of any REMIC I or REMIC II
Regular Interest outstanding as of any date of determination. As of the Closing Date, the
Uncertificated Principal Balance of each REMIC I and REMIC II Regular Interest shall equal the amount
set forth in the Preliminary Statement hereto as its Initial Uncertificated Principal Balance under
"REMIC I" and "REMIC II," respectively. On each Distribution Date, the Uncertificated Principal Balance
of each REMIC I Regular Interest and REMIC II Regular Interest shall be reduced, in the case of REMIC I
Regular Interests, by the sum of (i) the principal portion of Realized Losses allocated to the REMIC I
Regular Interests in accordance with the definition of REMIC I Realized Losses and (ii) the amounts
deemed distributed on each Distribution Date in respect of principal on the REMIC I Regular Interests
pursuant to Section 4.01(IV)(a)(i), and in the case of REMIC II Regular Interests, by the sum of (i) the
principal portion of Realized Losses allocated to the REMIC II Regular Interests in accordance with the
definition of REMIC II Realized Losses and (ii) the amounts deemed distributed on each Distribution Date
in respect of principal on the REMIC II Regular Interests pursuant to Section 4.01(IV)(a)(ii).
Uncertificated Regular Interest: Any of the REMIC I Regular Interests and REMIC II
Regular Interests.
Undercollateralized Group: As defined in Section 4.07(b).
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.
U.S. Person: A citizen or resident of the United States, a corporation, partnership
or other entity treated as a corporation or partnership for federal income tax purposes created or
organized in, or under the laws of, the United States, any State thereof or the District of Columbia, an
estate or trust whose income from sources without the United States is includable 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 any trust treated as a United States Person under Code
Section 7701(a)(30).
Voting Rights: The portion of the voting rights of all the Certificates that is
allocated to any Certificate for purposes of the voting provisions of this Agreement. At all times
during the term of this Agreement, 99% of all Voting Rights shall be allocated among the Class A
Certificates (other than the Residual Certificates), Class 4-M Certificates, Class 4-B-1 Certificates
and Class C-B Certificates. The portion of such 99% Voting Rights allocated to each of the Class A
Certificates (other than the Residual Certificates), Class 4-M Certificates, Class 4-B-1 Certificates
and Class C-B Certificates shall be based on the fraction, expressed as a percentage, the numerator of
which is the Class Principal Balance of each such Class then outstanding and the denominator of which is
the aggregate Class Principal Balance of all such Classes then outstanding. At all times during the
term of this Agreement, the Class 4-X Certificates shall be allocated 1% of the Voting Rights; provided,
however, for so long as the Class 4-X Certificates, or any portion thereof, are held in a NIM Trust, the
holders of the Class 4-X Certificates shall not be entitled to exercise any Voting Rights with respect
to their Certificates and the Voting Rights otherwise allocable to the Class 4-X Certificates shall be
allocated to the other Classes of Certificates. Voting Rights shall be allocated among the Certificates
within each Class in proportion to their respective outstanding Class Principal Balances or Class
Notional Amounts, as applicable. The Class AR and Class AR-L Certificates shall have no Voting Rights.
Weighted Average Pass-Through Rate: With respect to any Distribution Date and Loan
Group a rate equal to the weighted average of the Net Mortgage Rates on the Mortgage Loans in such Loan
Group as of the second preceding Due Date (excluding any such Mortgage Loans that were subject to a
Payoff, the principal of which was distributed on the Distribution Date preceding the current
Distribution Date) after giving effect to payments due on such Due Date, whether or not received,
weighted on the basis of the Stated Principal Balances as of such date.
Xxxxx Fargo: Xxxxx Fargo Bank, N.A., and its successors and assigns.
Xxxxx Fargo Custodial Agreement: That certain Custodial Agreement dated as of July 1,
2006 among Xxxxx Fargo, as custodian, the Trustee and the Trust Administrator.
Xxxxx Fargo Serviced Mortgage Loans: The Mortgage Loans identified as such on the
Mortgage Loan Schedule, for which Xxxxx Fargo is the applicable Servicer.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
SECTION 2.01. Conveyance of Trust Fund.
(a) The Depositor does hereby establish the Adjustable Rate Mortgage Trust 2006-3 (the "Trust") and
sells, transfers, assigns, delivers, sets over and otherwise conveys to the Trustee in trust for the
benefit of the Certificateholders, without recourse, the Depositor's right, title and interest in and to
(a) the Mortgage Loans listed in the Mortgage Loan Schedule, including all interest and principal
received or receivable by the Depositor on or with respect to the Mortgage Loans after the Cut-off Date
and any Assigned Prepayment Premiums with respect thereto, but not including payments of principal and
interest due and payable on the Mortgage Loans on or before the Cut-off Date, together with the Mortgage
Files relating to the Mortgage Loans, (b) REO Property, (c) the Collection Account, the Certificate
Account, the Group 4 Interest Rate Cap Accounts, the Supplemental Interest Account and all amounts
deposited therein pursuant to the applicable provisions of this Agreement, (d) any insurance policies
with respect to the Mortgage Loans, (e) the Depositor's rights under the Assignment and Assumption
Agreement and (f) all proceeds of the conversion, voluntary or involuntary, of any of the foregoing into
cash or other liquid property.
(b) In connection with the transfer and assignment set forth in clause (a) above, the Depositor has
delivered or caused to be delivered to a Custodian for the benefit of the Certificateholders, the
documents and instruments with respect to each Mortgage Loan as assigned:
(i) (A) the original Mortgage Note bearing all intervening endorsements and including any riders to
the Mortgage Note, endorsed "Pay to the order of ________________, without recourse" and signed in the
name of the last named endorsee by an authorized officer or (B) with respect to any Lost Mortgage Note,
a lost note affidavit and indemnity from the Seller stating that the original Mortgage Note was lost or
destroyed, (together with a copy of such Mortgage Note, if available) and indemnifying the Trust Fund
against any loss, cost or liability resulting from the failure to deliver the original Mortgage Note;
(ii) the original of any guarantee executed in connection with the Mortgage Note (if any);
(iii) for each Mortgage Loan that is not a MERS Mortgage Loan, the original Mortgage, with evidence
of recording thereon, or copies certified by the related recording office or if the original Mortgage
has not yet been returned from the recording office, a copy certified by or on behalf of the Seller
indicating that such Mortgage has been delivered for recording (the return directions for the original
Mortgage should indicate, when recorded, mail to the Seller) and in the case of each MERS Mortgage Loan,
the original Mortgage, noting the presence of the MIN of the related Mortgage Loan 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;
(iv) the originals of all assumption, modification, consolidation or extension agreements, (or, if
an original of any of these documents has not been returned from the recording office, a copy thereof
certified by or on behalf of the Seller, the original to be delivered to the Seller forthwith after
return from such recording office) with evidence of recording thereon, if any;
(v) for each Mortgage Loan that is not a MERS Mortgage Loan, the original Assignment of Mortgage as
appropriate, in recordable form, for each Mortgage Loan from the last assignee assigned in blank;
(vi) for each Mortgage Loan that was not a MERS Mortgage Loan at its origination, the originals of
any intervening recorded Assignments of Mortgage, showing a complete chain of assignment from
origination to the last assignee, including warehousing assignments, with evidence of recording thereon
(or, if an original intervening Assignment of Mortgage has not been returned from the recording office,
a copy thereof certified by or on behalf of the Seller, the original to be delivered to the Custodian
forthwith after return from such recording office);
(vii) the original mortgage title insurance policy, or copy of title commitment (or in appropriate
jurisdictions, attorney's opinion of title and abstract of title); and
(viii) with respect to a Cooperative Loan, if any, the originals of the following documents or
instruments:
(A) the Cooperative Shares, together with the Stock Power in blank;
(B) the executed Security Agreement;
(C) the executed Proprietary Lease and the Assignment of Proprietary Lease to the originator of the
Cooperative Loan;
(D) the executed Recognition Agreement;
(E) Copies of the original UCC financing statement, and any continuation statements, filed by the
originator of such Cooperative Loan as secured party, each with evidence of recording thereof,
evidencing the interest of the originator under the Security Agreement and the Assignment of Proprietary
Lease;
(F) Copies of the filed UCC assignments or amendments of the security interest referenced in clause
(E) above showing an unbroken chain of title from the originator to the Trust, each with evidence of
recording thereof, evidencing the interest of the assignee under the Security Agreement and the
Assignment of Proprietary Lease;
(G) An executed assignment of the interest of the originator in the Security Agreement, the
Assignment of Proprietary Lease and the Recognition Agreement, showing an unbroken chain of title from
the originator to the Trust; and
(H) For any Cooperative Loan that has been modified or amended, the original instrument or
instruments effecting such modification or amendment.
In addition, in connection with the assignment of any MERS Mortgage Loan, the Seller
agrees that it shall cause, at the Seller's expense, the MERS® System to indicate that such Mortgage
Loans have been assigned by the 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
or substituted in accordance with this Agreement) the information required by the MERS® System to
(a) identify the Trustee and (b) identify the series of the Certificates issued in connection with such
Mortgage Loans. The Trustee shall confirm, or cause the related Custodian to confirm, on the Final
Certification of the related Custodian whether or not such assignment has occurred. The Seller further
agrees that it shall not, and shall not permit a Servicer to, and each related Servicer agrees that it
shall not, alter the information referenced in this paragraph with respect to any Mortgage Loan during
the term of this Agreement unless and until such Mortgage Loan is repurchased or substituted in
accordance with the terms of this Agreement.
Further, each Servicer is authorized and empowered by the Trustee, on behalf of the
Certificateholders and the Trustee, in its own name or in the name of any Sub-Servicer, when a Servicer
or any Sub-Servicer, as the case may be, believes it appropriate in its best judgment to register any
Mortgage Loan on the MERS® System, or cause the removal from the registration of any Mortgage Loan on
the MERS® 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. Any costs incurred by a Servicer pursuant to this paragraph shall be considered
a Servicing Advance and shall be reimburseable to such Servicer.
In the event the Depositor delivers to a Custodian certified copies of any document or
instrument set forth in 2.01(b) because of a delay caused by the public recording office in returning
any recorded document, the Depositor shall deliver or cause to be delivered to such Custodian, within 60
days of the Closing Date, an Officer's Certificate which shall (i) identify the recorded document,
(ii) state that the recorded document has not been delivered to such Custodian due solely to a delay
caused by the public recording office, and (iii) state the amount of time generally required by the
applicable recording office to record and return a document submitted for recordation.
In the event that in connection with any Mortgage Loan the Depositor cannot deliver
(a) for a Mortgage Loan that is not a MERS Mortgage Loan, the original recorded Mortgage, (b) all interim
recorded assignments or (c) the lender's title policy (together with all riders thereto) satisfying the
requirements set forth above, concurrently with the execution and delivery hereof because such document
or documents have not been returned from the applicable public recording office in the case of clause
(a) or (b) above, or because the title policy has not been delivered to the Seller or the Depositor by
the applicable title insurer in the case of clause (c) above, the Depositor shall promptly deliver to
the related Custodian, in the case of clause (a) or (b) above, such original Mortgage or such interim
assignment, as the case may be, with evidence of recording indicated thereon upon receipt thereof from
the public recording office, or a copy thereof, certified, if appropriate, by the relevant recording
office and, in the case of clause (c) above, any title policy upon receipt from the applicable title
insurer.
As promptly as practicable subsequent to such transfer and assignment, and in any
event, within thirty (30) days thereafter, DLJMC shall, at its expense, (i) affix or cause to be affixed
the Trustee's name to each Assignment of Mortgage, as the assignee thereof, (ii) cause such assignment
to be in proper form for recording in the appropriate public office for real property records within
thirty (30) days after receipt thereof and (iii) cause to be delivered for recording in the appropriate
public office for real property records the assignments of the Mortgages to the Trustee, except that,
with respect to any assignment of a Mortgage as to which DLJMC has not received the information required
to prepare such assignment in recordable form, DLJMC'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 the receipt thereof, and DLJMC need not cause to be recorded any assignment which
relates to a Mortgage Loan in any jurisdiction under the laws of which, as evidenced by an Opinion of
Counsel delivered by the Depositor (at the Depositor's expense) to the Trustee, the Trust Administrator
and DLJMC, acceptable to the Rating Agencies, the recordation of such assignment is not necessary to
protect the Trustee's and the Certificateholders' interest in the related Mortgage Loan.
If any original Mortgage Note referred to in Section 2.01(b)(i) above cannot be
located, the obligations of the Depositor to deliver such documents shall be deemed to be satisfied upon
delivery to the related Custodian of a photocopy of such Mortgage Note, if available, with a lost note
affidavit and indemnity. If any of the original Mortgage Notes for which a lost note affidavit and
indemnity was delivered to the Custodian is subsequently located, such original Mortgage Note shall be
delivered to such Custodian within three (3) Business Days.
(c) The Trustee and the Trust Administrator are authorized to enter into one or more Custodial
Agreements, at the direction of the Depositor, for the purpose of having a Custodian maintain custody of
the documents and instruments referred to in this Section 2.01, and any documents delivered thereunder
shall be delivered to such Custodian and any Officer's Certificates delivered with respect thereto shall
be delivered to the Trustee, the Trust Administrator and such Custodian.
(d) It is the express intent of the parties to this Agreement that the conveyance of the Mortgage
Loans by the Depositor to the Trustee as provided in this Section 2.01 be, and be construed as, a sale
of the Mortgage Loans by the Depositor to the Trustee. It is, further, not the intention of the parties
to this Agreement that such conveyance be deemed a pledge of the Mortgage Loans by the Depositor to the
Trustee to secure a debt or other obligation of the Depositor. However, in the event that,
notwithstanding the intent of the parties to this Agreement, the Mortgage Loans are held to be the
property of the Depositor, or if any for any other reason this Agreement is held or deemed to create a
security interest in the Mortgage Loans then (a) this Agreement shall also be deemed to be a security
agreement within the meaning of Articles 8 and 9 of the New York Uniform Commercial Code; (b) the
conveyance provided for in this Section 2.01 shall be deemed to be a grant by the Depositor to the
Trustee for the benefit of the Certificateholders of a security interest in all of the Depositor's
right, title and interest in and to (1) the Mortgage Loans listed in the Mortgage Loan Schedule,
including all interest and principal received or receivable by the Depositor on or with respect to the
Mortgage Loans after the Cut-off Date and any Assigned Prepayment Premiums with respect thereto, but not
including payments of principal and interest due and payable on the Mortgage Loans on or before the
Cut-off Date, together with the Mortgage Files relating to the Mortgage Loans, (2) REO Property, (3) the
Collection Account, the Certificate Account, the Group 4 Interest Rate Cap Accounts, the Supplemental
Interest Account and all amounts deposited therein pursuant to the applicable provisions of this
Agreement, (4) any insurance policies with respect to the Mortgage Loans, (5) the Depositor's rights
under the Assignment and Assumption Agreement, (6) the Trust's rights under the Group 4 Interest Rate
Cap Agreements and the Swap Agreement, and (7) all proceeds of the conversion, voluntary or involuntary,
of any of the foregoing into cash or other liquid property; (c) the possession by the Trustee or any
Custodian of such items of property and such other items of property as constitute instruments, money,
negotiable documents or chattel paper shall be deemed to be "in possession by the secured party" for
purposes of perfecting the security interest pursuant to Section 9-313 of the New York Uniform
Commercial Code; and (d) notifications to persons holding such property, and acknowledgments, receipts
or confirmations from persons holding such property, shall be deemed notifications to, or
acknowledgments, receipts or confirmations from, financial intermediaries, bailees or agents (as
applicable) of the Trustee for the benefit of the Certificateholders for the purpose of perfecting such
security interest under applicable law (except that nothing in this clause (d) shall cause any person to
be deemed to be an agent of the Trustee for any purpose other than for perfection of such security
interests unless, and then only to the extent, expressly appointed and authorized by the Trustee in
writing). The Depositor and the Trustee, upon directions from the Depositor, 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 Mortgage Loans, 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 this Agreement.
(e) The Depositor hereby authorizes and directs the Trust Administrator to (i) execute the Group 4
Interest Rate Cap Agreements and (ii) to ratify, on behalf of the Trust, the terms agreed to by the
Depositor with respect to the Group 4 Interest Rate Cap Agreements. The Depositor shall pay or cause to
be paid on behalf of the Trust the payments owed to the Group 4 Interest Rate Cap Counterparty as of the
Closing Date pursuant to the terms of the Group 4 Interest Rate Cap Agreements.
(f) Except as specifically set forth in this Agreement or by separate written agreement among the
related parties hereto, the Depositor, the Seller, each Servicer and the Master Servicer agree that the
provisions of this Agreement shall supersede any provisions in any existing mortgage loan purchase
agreement or servicing agreement with respect to the Mortgage Loans for which the Depositor, the Seller,
a Servicer or the Master Servicer may be a party.
SECTION 2.02. Acceptance by the Trustee.
(a) Pursuant to the related Custodial Agreement, each Custodian agrees to execute and deliver on
the Closing Date to the Depositor, the Trustee and the Trust Administrator a Trust Receipt and Initial
Certification in the form annexed hereto as Exhibit I. Based on its review and examination, and only as
to the documents identified in such Trust Receipt and Initial Certification, each Custodian acknowledges
that such documents appear regular on their face and relate to such Mortgage Loan. The Custodians 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.
Pursuant to the related Custodial Agreement, not later than 90 days after the Closing
Date, each Custodian shall deliver to the Depositor, the Trustee and the Trust Administrator a Trust
Receipt and Final Certification in the form annexed hereto as Exhibit J, with any applicable exceptions
noted thereon.
Based solely upon the Trust Receipt and Initial Certification received from the
Custodians, and subject to the provisions of Section 2.01 and any exceptions noted on an exception
report described in the next paragraph below, the Trustee acknowledges receipt of the documents referred
to in Section 2.01 above and declares that it holds and shall hold such documents and the other
documents delivered to it constituting the Mortgage File, and that it holds or shall hold all such
assets and such other assets included in the definition of the Trust Fund in trust for the exclusive use
and benefit of all present and future Certificateholders.
If, in the course of such review, a Custodian finds any document constituting a part
of a Mortgage File which does not meet the requirements of Section 2.01, such Custodian shall list such
as an exception in the Trust Receipt and Final Certification pursuant to the related Custodial
Agreement; provided, however, that a Custodian 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.
The Seller shall promptly correct or cure such defect within 90 days from the date it
was so notified of such defect and, if the Seller does not correct or cure such defect within such
period and such defect materially and adversely affects the interests of Certificateholders in the
related Mortgage Loan, the Seller shall either (a) substitute for the related Mortgage Loan a Qualified
Substitute Mortgage Loan, which substitution shall be accomplished in the manner and subject to the
conditions set forth in Section 2.03, or (b) repurchase such Mortgage Loan within 90 days from the date
that the Seller was notified of such defect in writing at the Purchase Price of such Mortgage Loan; or
such longer period not to exceed 720 days from the Closing Date if the substitution or repurchase 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 or title insurer, as applicable; provided, however, that the Seller
shall have no liability for recording any Assignment of Mortgage in favor of the Trustee or for the
Custodian's failure to record such Assignment of Mortgage, and provided, further, that no Seller shall
be obligated to repurchase or cure any Mortgage Loan solely as a result of a Custodian's failure to
record such Assignment of Mortgage. The Trust Administrator shall deliver or direct the related
Custodian to deliver to each Rating Agency written notice within 270 days from the Closing Date
indicating each Mortgage Loan (a) for which a mortgage or assignment of mortgage required to be recorded
hereunder 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 related Custodian. Any such substitution
pursuant to clause (a) of the preceding sentence shall not be effected prior to the delivery to the
Trustee and the Trust Administrator of (1) the Opinion of Counsel required by Section 2.05 hereof, and
(2) a Request for Release substantially in the form of Exhibit K. 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 the Seller in the related Collection Account and the Seller shall
notify the related Servicer to deliver a Request for Release substantially in the form of Exhibit K on
or prior to the Business Day immediately preceding such Distribution Date in the month following the
month during which the Seller became obligated hereunder to repurchase or replace such Mortgage Loan.
Upon receipt of notice from the Seller, the related Servicer shall deliver a Request for Release
substantially in the form of Exhibit K to the related Custodian, the Trustee and the Trust
Administrator. Upon receipt of such deposit and Request for Release with respect thereto in the form of
Exhibit K, the related Custodian shall release the related Mortgage File to the Seller and shall execute
and deliver at such entity's request such instruments of transfer or assignment prepared by such entity,
in each case without recourse, as shall be necessary to vest in such entity, or a designee, the
Trustee's interest in any Mortgage Loan released pursuant hereto.
If pursuant to the preceding paragraph the Seller repurchases a Mortgage Loan that is
a MERS Mortgage Loan, the related Servicer shall, at the Seller's expense, either (i) cause MERS to
execute and deliver an Assignment of Mortgage in recordable form to transfer the Mortgage from MERS to
the Seller and shall cause such Mortgage to be removed from registration on the MERS® System in
accordance with MERS' rules and regulations or (ii) cause MERS to designate on the MERS® System the
Seller as the beneficial holder of such Mortgage Loan.
(b) It is understood and agreed that the obligation of the Seller to cure, substitute for or to
repurchase any Mortgage Loan which does not meet the requirements of Section 2.01 shall constitute the
sole remedy respecting such defect available to the Trustee, the Trust Administrator, the Depositor and
any Certificateholder against the Seller.
(c) With respect to any Mortgage Loan which the Seller reasonably believes breaches a
representation, warranty or covenant under the mortgage loan purchase agreement pursuant to which the
Seller purchased from the originator or prior holder of such Mortgage Loan, the Seller shall have the
right to repurchase such Mortgage Loan from the Trust at any time in order to facilitate its rights
against such originator or prior holder of such Mortgage Loan at a price equal to the Repurchase Price;
provided, however, that in no event shall such repurchase take place with respect to Mortgage Loans
constituting more than 5% of the aggregate Cut-off Date Principal Balance of the Mortgage Loans.
In the event that DLJMC exercises such option, the Repurchase Price therefor shall be
deposited in the Certificate Account and DLJMC shall notify the related Servicer to deliver a Request
for Release substantially in the form of Exhibit K. Upon receipt of notice from the Seller, the related
Servicer shall deliver a Request for Release substantially in the form of Exhibit K to the related
Custodian, the Trustee and the Trust Administrator. Upon such deposit of the Repurchase Price and
receipt of a Request for Release in the form of Exhibit K, the related Custodian shall release the
related Mortgage File held for the benefit of the Certificateholders to DLJMC, and the Trustee shall
execute and deliver at DLJMC's direction such instruments of transfer or assignment prepared by DLJMC,
in each case without recourse, as shall be necessary to transfer title from the Trustee to DLJMC.
SECTION 2.03. Representations and Warranties of the Seller, Master Servicer and Servicers.
(a) Each of DLJMC, in its capacity as Seller, Xxxxx Fargo, in its capacity as Master Servicer, SPS,
in its capacity as Servicer and Special Servicer, Xxxxx Fargo, in its capacity as Servicer, and
GreenPoint in its capacity as Servicer, hereby makes the representations and warranties set forth in
Schedules IIA, IIB, IIC, IID or IIE hereto, respectively, and by this reference incorporated herein, to
the Depositor, the Trustee and the Trust Administrator, as of the Closing Date, or if so specified
therein, as of the Cut-off Date or such other date as may be specified. In addition, SPS, in its
capacity as Servicer and Special Servicer, Xxxxx Fargo, in its capacity as Servicer, and GreenPoint, in
its capacity as Servicer, makes the representations and warranties set forth in Schedules IIC, IID and
IIE hereto, respectively, and by this reference incorporated herein, to the Master Servicer as of the
Closing Date, or if so specified therein, as of the Cut-off Date or such other date as may be specified.
(b) DLJMC, in its capacity as Seller, hereby makes the representations and warranties set forth in
Schedule III as to the Mortgage Loans and by this reference incorporated herein, to the Depositor, the
Trustee and the Trust Administrator, as of the Closing Date, or if so specified therein, as of the
Cut-off Date or such other date as may be specified.
(c) Upon discovery by any of the parties hereto of a breach of a representation or warranty made
pursuant to Section 2.03(b) that materially and adversely affects the interests of the
Certificateholders in any Mortgage Loan, the party discovering such breach shall give prompt notice
thereof to the other parties. The 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
made by it pursuant to Section 2.03(b) which materially and adversely affects the interests of the
Certificateholders in any Mortgage Loan sold by the Seller to the Trust, 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 Qualified Substitute Mortgage Loan, in the
manner and subject to the conditions set forth in this Section 2.03; or (ii) repurchase the affected
Mortgage Loan or Mortgage Loans 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 and the Trust Administrator 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, the Trust Administrator and the related Custodian of a Request for Release substantially
in the form of Exhibit K relating to the Deleted Mortgage Loan and the Mortgage File for any such
Qualified Substitute Mortgage Loan. The Seller shall promptly reimburse the Trustee, the Trust
Administrator, the Special Servicer and the related Servicer (if such Servicer is not the Seller of such
Mortgage Loan) for any actual out of pocket expenses reasonably incurred by the Trustee, the Trust
Administrator, the Special Servicer and the related Servicer (if such Servicer is not the Seller of such
Mortgage Loan) in respect of enforcing the remedies for such breach. With respect to any representation
and warranties described in this Section 2.03 which are made to the best of the Seller's knowledge if it
is discovered by any of the Depositor, the Master Servicer, the Seller, any Servicer, the Special
Servicer, the Trustee or the Trust Administrator 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 the 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.
With respect to any Qualified Substitute Mortgage Loan or Loans, the Seller shall
deliver to the related Custodian 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(b), 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 Qualified Substitute Mortgage Loans in the
month of substitution shall not be part of the Trust Fund and shall be retained by the 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 the
Seller shall be entitled to retain all amounts received in respect of such Deleted Mortgage Loan. The
Seller shall amend the Mortgage Loan Schedule for the benefit of the Certificateholders to reflect the
removal of such Deleted Mortgage Loan and the substitution of the Qualified Substitute Mortgage Loan or
Loans and the Seller shall deliver the amended Mortgage Loan Schedule to the Trustee, the Servicers and
the Trust Administrator. Upon such substitution, the Qualified Substitute Mortgage Loan or Loans shall
be subject to the terms of this Agreement in all respects, and the Seller shall be deemed to have made
with respect to such Qualified Substitute Mortgage Loan or Loans, as of the date of substitution, the
representations and warranties made pursuant to Section 2.03(b) with respect to such Mortgage Loan.
Upon any such substitution and the deposit to the Collection Account of the amount required to be
deposited therein in connection with such substitution as described in the following paragraph, the
Trustee shall instruct the related Custodian to release the Mortgage File held for the benefit of the
Certificateholders relating to such Deleted Mortgage Loan to the Seller and the Trustee shall execute
and deliver at the Seller's direction such instruments of transfer or assignment prepared by the Seller,
in each case without recourse, as shall be necessary to vest title in the 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 the Seller substitutes one or more Qualified Substitute
Mortgage Loans for one or more Deleted Mortgage Loans, the Master Servicer shall determine the amount
(if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage Loans as of
the date of substitution is less than the aggregate Stated Principal Balance of all such Deleted
Mortgage Loans (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, Servicing Advances and unpaid Servicing Fees
with respect to such Deleted Mortgage Loans shall be deposited in the related Collection Account by the
Seller and the Seller shall notify the related Servicer to deliver a Request for Release substantially
in the form of Exhibit K on or before the Business Day immediately preceding the Distribution Date in
the month succeeding the calendar month during which the related Mortgage Loan became required to be
repurchased or replaced hereunder. Upon receipt of notice from the Seller, the related Servicer shall
deliver a Request for Release substantially in the form of Exhibit K to the related Custodian, the
Trustee and the Trust Administrator.
One or more mortgage loans may be substituted for one or more Deleted Mortgage Loans.
The determination of whether a mortgage loan is a Qualified Substitute Mortgage Loan may be satisfied on
an individual basis. Alternatively, if more than one mortgage loan is to be substituted for one or more
Deleted Mortgage Loans, the characteristics of such mortgage loans and Deleted Mortgage Loans shall be
aggregated or calculated on a weighted average basis, as applicable, in determining whether such
mortgage loans are Qualified Substitute Mortgage Loans.
In the event that the Seller shall be required to repurchase a Mortgage Loan pursuant
to this Agreement, the Purchase Price therefor shall be deposited in the related Collection Account and
the Seller shall notify the related Servicer to deliver a Request for Release substantially in the form
of Exhibit K on or before the Business Day immediately preceding the Distribution Date in the month
following the month during which the Seller became obligated hereunder to repurchase or replace such
Mortgage Loan. Upon receipt of notice from the Seller, the related Servicer shall deliver a Request for
Release substantially in the form of Exhibit K to the related Custodian, the Trustee and the Trust
Administrator. Upon such deposit of the Purchase Price and receipt of a Request for Release
substantially in the form of Exhibit K, the related Custodian 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 substitute 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, the Trustee
or the Trust Administrator 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, the Trust Administrator or the Custodians for
the benefit of the Certificateholders.
Notwithstanding the foregoing, the substitution of a Deleted Mortgage Loan that is a
GreenPoint Serviced Mortgage Loan or the repurchase of a Mortgage Loan that is a GreenPoint Serviced
Mortgage Loan by the Seller shall be subject to, and shall in no way adversely affect, the right of
GreenPoint to continue servicing and collecting its Servicing Fee for such Deleted Mortgage Loan or
Mortgage Loan, as applicable.
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 the
Mortgage Loans that, as of the Closing Date, assuming good title has been conveyed to the Depositor, the
Depositor had good title to the Mortgage Loans and Mortgage Notes, and did not encumber the Mortgage
Loans during its period of ownership thereof, other than as contemplated by the 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 related Custodian.
SECTION 2.05. Delivery of Opinion of Counsel in Connection with Substitutions.
Notwithstanding any contrary provision of this Agreement, no substitution pursuant to
Section 2.02 shall be made more than ninety (90) days after the Closing Date unless the Seller delivers
to the Trustee and the Trust Administrator an Opinion of Counsel, which Opinion of Counsel shall not be
at the expense of any of the Trustee, the Trust Administrator or the Trust Fund, addressed to the
Trustee and the Trust Administrator, to the effect that such substitution will not (i) result in the
imposition of the tax on "prohibited transactions" on the Trust Fund or contributions after the Startup
Date, as defined in Sections 860F(a)(2) and 860G(d) of the Code, respectively, or (ii) cause any REMIC
created hereunder to fail to qualify as a REMIC at any time that any Certificates are outstanding;
provided, however, that no Opinion of Counsel shall be required if (A) the substitution occurs within
two years of the Closing Date and (B) the substitution occurs with respect to Mortgage Loans that are
"defective" under the Code and the Seller delivers to the Trustee and the Trust Administrator an
Officer's Certificate substantially in the form of Exhibit Z.
SECTION 2.06. Issuance of Certificates.
The Trustee acknowledges the assignment to it of the Mortgage Loans together with the
assignment to it of all other assets included in the Trust Fund, receipt of which, subject to the
provisions of Section 2.02(a), is hereby acknowledged. Concurrently with such assignment and delivery
and in exchange therefor, the Trust Administrator, pursuant to the written request of the Depositor
executed by an officer of the Depositor, has executed the Certificates and caused them to be
authenticated and delivered to or upon the order of the Depositor in authorized denominations which
evidence ownership of the Trust Fund. The rights of the Holders of such Certificates to receive
distributions from the Trust Fund and all ownership interests of the Holders of the Certificates in such
distributions shall be as set forth in this Agreement.
SECTION 2.07. REMIC Provisions.
(a) The Depositor hereby elects and authorizes the Trust Administrator to treat the Trust Fund
(exclusive of any entitlement to Assigned Prepayment Premiums, the Group 4 Interest Rate Cap Agreements,
the assets held in the Group 4 Interest Rate Cap Accounts, and rights to payments from the Supplemental
Interest Account) as the number of separate REMICs specified in the Preliminary Statement (each, a
"REMIC") under the Code and, if necessary, under applicable state law and apply such Preliminary
Statement in determining the rights of the Interests in REMICs thereby created. Each such election will
be made on Form 1066 or other appropriate federal tax or information return (including Form 8811) or any
appropriate state return (x) for the taxable year ending on the last day of the calendar year in which
the Certificates are issued and (y) for the taxable year ending on the last day of the calendar year in
which Certificates are first sold to a third party. The Closing Date is hereby designated as the
"startup day" of each REMIC created hereunder within the meaning of Section 860G(a)(9) of the Code. The
"regular interests" (within the meaning of Section 860G of the Code) in each REMIC shall consist of the
regular interests with the terms set forth for each REMIC in the Preliminary Statement and the Class AR
and Class AR-L Certificates shall represent the beneficial ownership of the "residual interest" in each
REMIC created hereunder. Neither the Depositor nor the Trust Administrator nor the Trustee shall permit
the creation of any "interests" (within the meaning of Section 860G of the Code) in any REMIC other than
as set forth in the Preliminary Statement.
(b) The Trust Administrator shall act as the "tax matters person" (within the meaning of the REMIC
Provisions) for each REMIC created hereunder, in the manner provided under Treasury regulations section
1.860F 4(d) and temporary Treasury regulations section 301.6231(a)(7)1T. In the event that for any
reason, the Trust Administrator is not recognized as the tax matters person then the Trust Administrator
shall act as agent for the Class AR and the Class AR-L Certificateholder as tax matters person. By its
acceptance of a Residual Certificate, each Holder thereof shall have agreed to such appointment and
shall have consented to the appointment of the Trust Administrator as its agent to act on behalf of each
REMIC created hereunder pursuant to the specific duties outlined herein.
(c) A Holder of a Residual Certificate, by the purchase of such Certificate, shall be deemed to
have agreed to timely pay, upon demand by the Trust Administrator, the amount of any minimum California
state franchise taxes due with respect to the related REMIC created hereunder under Sections
23151(a) and 23153(a) of the California Revenue and Taxation Code. Notwithstanding the foregoing, the
Trust Administrator shall be authorized to retain the amount of such tax from amounts otherwise
distributable to such Holder in the event such Holder does not promptly pay such amount upon demand by
the Trust Administrator. In the event that any other federal, state or local tax is imposed, including
without limitation taxes imposed on a "prohibited transaction" of a REMIC as defined in Section 860F of
the Code, such tax shall be charged against amounts otherwise available for distribution to the
applicable Holder of a Residual Certificate and then against amounts otherwise available for
distribution to the Holders of Regular Certificates in accordance with the provisions set forth in
Section 4.01. The Trust Administrator or the Trustee shall promptly deposit in the Certificate Account
any amount of "prohibited transaction" tax that results from a breach of the Trust Administrator's or
the Trustee's duties, respectively, under this Agreement. The Master Servicer or the related Servicer
shall promptly deposit in the Certificate Account any amount of "prohibited transaction" tax that
results from a breach of the Master Servicer's or such Servicer's duties, respectively, under this
Agreement.
(d) The Trust Administrator shall act as attorney in fact and as the tax matters person of each
REMIC created hereunder and in such capacity the Trust Administrator shall: (i) prepare, sign and file,
or cause to be prepared, signed and filed, federal and state tax returns using a calendar year as the
taxable year for each REMIC created hereunder when and as required by the REMIC Provisions and other
applicable federal income tax laws as the direct representative of each such REMIC in compliance with
the Code and shall provide copies of such returns as required by the Code; (ii) make an election, on
behalf of each REMIC created hereunder, to be treated as a REMIC on the federal tax return of such REMIC
for its first taxable year, in accordance with the REMIC Provisions; and (iii) prepare and forward, or
cause to be prepared and forwarded, to the Certificateholders and to any governmental taxing authority
all information reports as and when required to be provided to them in accordance with the REMIC
Provisions. The expenses of preparing and filing such returns shall be borne by the Trust
Administrator. The Depositor, the Master Servicer and the related Servicer shall provide on a prompt
and timely basis to the Trust Administrator or its designee such information with respect to each REMIC
created hereunder as is in their possession and reasonably required or requested by the Trust
Administrator to enable it to perform its obligations under this subsection.
In its capacity as attorney in fact and as the tax matters person, the Trust
Administrator shall also: (A) act on behalf of each REMIC created hereunder in relation to any tax
matter or controversy involving the Trust Fund, (B) represent the Trust Fund in any administrative or
judicial proceeding relating to an examination or audit by any governmental taxing authority with
respect thereto and (C) cause to be paid solely from the sources provided herein the amount of any taxes
imposed on each REMIC created hereunder when and as the same shall be due and payable (but such
obligation shall not prevent the Trust Administrator or any other appropriate Person from contesting any
such tax in appropriate proceedings and shall not prevent the Trust Administrator from withholding
payment of such tax, if permitted by law, pending the outcome of such proceedings).
(e) The Trust Administrator shall provide (i) to any transferor of a Residual Certificate such
information as is necessary for the application of any tax relating to the transfer of a Residual
Certificate to any Person who is not a permitted transferee, (ii) to the Certificateholders such
information or reports as are required by the Code or the REMIC Provisions including reports relating to
interest, original issue discount and market discount or premium and (iii) to the Internal Revenue
Service the name, title, address and telephone number of the person who shall serve as the
representative of each REMIC created hereunder.
(f) The Trustee, to the extent directed by the Trust Administrator, the Depositor and the Holder of
the Residual Certificates shall take any action or cause the Trust Fund to take any action necessary to
create or maintain the status of each REMIC created hereunder as a REMIC under the REMIC Provisions and
shall assist each other as necessary to create or maintain such status. Neither the Trustee, to the
extent directed or (in the case of a failure to act) not directed by the Trust Administrator, nor the
Holder of the Residual Certificates shall take any action, cause the Trust Fund to take any action or
fail to take (or fail to cause the Trust Fund to take) any action that, under the REMIC Provisions, if
taken or not taken, as the case may be, could (i) endanger the status of each REMIC created hereunder as
a REMIC or (ii) result in the imposition of a tax upon a REMIC (including, but not limited to, the tax
on prohibited transactions as defined in Code Section 860F(a)(2) and the tax on prohibited contributions
set forth in Section 860G(d) of the Code) (either such event, an "Adverse REMIC Event") unless the
Trustee and the Trust Administrator have received an Opinion of Counsel (at the expense of the party
seeking to take such action) to the effect that the contemplated action shall not endanger such status
or result in the imposition of such a tax.
The Trustee and the Trust Administrator shall not take or fail to take any action
(whether or not authorized hereunder) as to which the Master Servicer, a Servicer or the Depositor has
advised it in writing that it has received an Opinion of Counsel to the effect that an Adverse REMIC
Event could occur with respect to such action. In addition, prior to taking any action with respect to
a REMIC or their assets, or causing any REMIC created hereunder to take any action, which is not
expressly permitted under the terms of this Agreement, the Trustee and the Trust Administrator shall
consult with the Master Servicer, the Servicers and the Depositor or their designees, in writing, with
respect to whether such action could cause an Adverse REMIC Event to occur with respect to any REMIC
created hereunder and the Trustee and the Trust Administrator shall not take any such action or cause
that REMIC to take any such action as to which the Master Servicer, any Servicer or the Depositor has
advised it in writing that an Adverse REMIC Event could occur.
In addition, prior to taking any action with respect to any REMIC created hereunder or
the assets therein, or causing any REMIC created hereunder to take any action, which is not expressly
permitted under the terms of this Agreement, the Holder of the Residual Certificates shall consult with
the Trust Administrator or its designee, in writing, with respect to whether such action could cause an
Adverse REMIC Event to occur with respect to any REMIC created hereunder, and no such Person shall take
any action or cause the Trust Fund to take any such action as to which the Trust Administrator has
advised it in writing that an Adverse REMIC Event could occur. The Trustee and the Trust Administrator
may consult with counsel to make such written advice, and the cost of same shall be borne by the party
seeking to take action not permitted by this Agreement.
At all times as may be required by the Code, the Trust Administrator shall, to the
extent within its control and the scope of its duties more specifically set forth herein, maintain
substantially all of the assets of each REMIC created hereunder as "qualified mortgages" as defined in
Section 860G(a)(3) of the Code and "permitted investments" as defined in Section 860G(a)(5) of the Code.
(g) In the event that any tax is imposed on "prohibited transactions" of any REMIC created
hereunder, as defined in Section 860F(a)(2) of the Code, on "net income from foreclosure property" of
such REMIC, as defined in Section 860G(c) of the Code, on any contributions to a REMIC after the Startup
Day therefor pursuant to Section 860G(d) of the Code, or any other tax is imposed by the Code or any
applicable provisions of state or local tax laws, such tax shall be charged (i) to the related Servicer,
if such Servicer has in its sole discretion determined to indemnify the Trust Fund against such tax or
if such tax arises out of or results from a breach of such Servicer's duties under (x) Section 2.07(j)
of this Agreement to not enter into any arrangement by which a REMIC would receive a fee or other
compensation for services or to permit such REMIC to receive any income from assets other than
"qualified mortgages" or "permitted investments," (y) Section 3.01 of this Agreement to 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 or (z) Section 3.11(c) of this Agreement to not cause any REO Property to
fail to qualify as "foreclosure property" within the meaning of Section 860G(a)(8) of the Code or to
subject any REMIC created 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 of otherwise, (ii) to the
Master Servicer, if such tax arises out of or results from a breach by the Master Servicer of any of its
obligations under this Agreement or if the Master Servicer has in its sole discretion determined to
indemnify the Trust Fund against such tax, (iii) to the Trust Administrator, if such tax arises out of
or results from a breach by the Trust Administrator of any of its obligations under this Article II,
(iv) to the Trustee, if such tax arises out of or results from a breach by the Trustee of any of its
obligations under this Article II or (v) otherwise against amounts on deposit in the Collection Account
as provided by Section 3.08 and on the Distribution Date(s) following such reimbursement the aggregate
of such taxes shall be allocated in reduction of the Interest Distribution Amount on each Class entitled
thereto in the same manner as if such taxes constituted a Prepayment Interest Shortfall.
In accordance with Section 2.07(c), the related Servicer, the Master Servicer, the
Trustee or the Trust Administrator, as applicable, shall promptly deposit in the Certificate Account or
Collection Account, as applicable, any amount of such tax.
For purposes of this Section 2.07(g), a tax is imposed following the final and
unappealable determination under the Code of the amount of such tax and written notice thereof by the
Tax Matters Person to the party to be charged.
The failure of the Master Servicer or the related Servicer to promptly deposit in the
Certificate Account or Collection Account, as applicable, any amount of such tax shall be an Event of
Default, as provided in Section 8.01(b).
(h) The Trust Administrator shall, for federal income tax purposes, maintain books and records with
respect to each REMIC created hereunder on a calendar year and on an accrual basis or as otherwise may
be required by the REMIC Provisions.
(i) Following the Startup Day, none of any Servicer, the Trustee (which shall act only at the
direction of the Trust Administrator or as otherwise specifically provided in this Agreement) or the
Trust Administrator shall accept any contributions of assets to any REMIC created hereunder unless
(subject to Section 2.05) such Servicer, the Trustee or the Trust Administrator shall have received an
Opinion of Counsel (at the expense of the party seeking to make such contribution) to the effect that
the inclusion of such assets in a REMIC will not cause that REMIC to fail to qualify as a REMIC at any
time that any Certificates are outstanding, or subject that REMIC to any tax under the REMIC Provisions
or other applicable provisions of federal, state and local law or ordinances.
(j) None of any Servicer, the Trustee (which shall act only at the direction of the Trust
Administrator or as otherwise specifically provided in this Agreement) or the Trust Administrator shall
(subject to Section 2.05) enter into any arrangement by which a REMIC will receive a fee or other
compensation for services nor permit such REMIC to receive any income from assets other than "qualified
mortgages" as defined in Section 860G(a)(3) of the Code or "permitted investments" as defined in
Section 860G(a)(5) of the Code.
(k) Within 30 days after the Closing Date, the Trust Administrator shall apply to the Internal
Revenue Service for an employer identification number for each REMIC created hereunder by means of a
Form SS-4 or other acceptable means and prepare and file with the Internal Revenue Service Form 8811,
"Information Return for Real Estate Mortgage Investment Conduits (REMIC) and Issuers of Collateralized
Debt Obligations" for each REMIC created hereunder.
(l) None of the Trustee (which shall act only at the direction of the Trust Administrator or as
otherwise specifically provided in this Agreement), the Trust Administrator, the Master Servicer or any
Servicer shall sell, dispose of or substitute for any of the Mortgage Loans (except in connection with
(i) the default, imminent default or foreclosure of a Mortgage Loan, including but not limited to, the
acquisition or sale of a Mortgaged Property acquired by deed in lieu of foreclosure, (ii) the bankruptcy
of any REMIC created hereunder, (iii) the termination of any REMIC created hereunder pursuant to Article
X of this Agreement or (iv) a purchase of Mortgage Loans pursuant to Article II or III of this
Agreement) nor acquire any assets for a REMIC, nor sell or dispose of any investments in the Collection
Account or the Certificate Account for gain nor accept any contributions to a REMIC after the Closing
Date (a) unless it has received an Opinion of Counsel that such sale, disposition, substitution or
acquisition will not affect adversely the status of any REMIC created hereunder as a REMIC or (b) unless
the Master Servicer or such Servicer has determined in its sole discretion to indemnify the Trust Fund
against such tax.
(m) In order to enable the Trust Administrator to perform its duties as set forth herein, the
Depositor shall provide, or cause to be provided to the Trust Administrator, within ten days after the
Closing Date, all information or data the Trust Administrator 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 and the
Trust Administrator shall be entitled to rely upon any and all such information and data in the
performance of its duties set forth herein. Thereafter, the Master Servicer shall provide, promptly
upon request therefor, any such additional information or data that the Trustee or the Trust
Administrator may from time to time reasonably request in order to enable the Trustee and the Trust
Administrator to perform their duties as set forth herein and the Trustee and the Trust Administrator
shall be entitled to rely upon any and all such information and data in the performance of its duties
set forth herein. DLJMC shall indemnify the Trust Administrator and hold it harmless for any loss,
liability, damage, claim or expense of the Trust Administrator arising from any failure of the Depositor
to provide, or to cause to be provided, accurate information or data to the Trust Administrator on a
timely basis. The Master Servicer shall indemnify the Trustee and the Trust Administrator and hold it
harmless for any loss, liability, damage, claim or expense of the Trustee and the Trust Administrator
arising from any failure of the Master Servicer to provide, or to cause to be provided, accurate
information or data required to be provided by the Master Servicer to the Trustee and the Trust
Administrator on a timely basis; provided, however, that if any Servicer shall fail to provide such
information to the Master Servicer upon timely request for such information by the Master Servicer, that
Servicer shall indemnify the Master Servicer, the Trustee and the Trust Administrator and hold it
harmless for any loss, liability, damage, claim or expense of the Master Servicer, the Trustee and the
Trust Administrator arising from any failure of that Servicer to provide, or to cause to be provided,
the information referred to above on a timely basis. The indemnification provisions hereunder shall
survive the termination of this Agreement and shall extend to any co-trustee and co-Trust Administrator
appointed pursuant to this Agreement.
(n) The Trust Administrator shall account for the rights of the Holders of the LIBOR Certificates
to receive payments in respect of Basis Risk Shortfalls and the rights of the Holders of the Class 4-A-2
Certificates to receive payments from the Supplemental Interest Account as rights in an interest rate
cap contract written by the Class 4-X Certificateholders in favor of the Holders of the LIBOR
Certificates and not as an obligation of REMIC III, whose obligation to pay interest on the REMIC III
Regular Interests evidenced by such Certificates will be subject to a cap equal to the Net Funds Cap.
The Trust Administrator shall account for such rights as property held separate and apart from such
REMIC III Regular Interests as required by Treasury regulation section 1.860G-2(i). Any amounts paid
from the Interest Remittance Amount or Principal Remittance Amount to the holders of the LIBOR
Certificates in respect of Basis Risk Shortfalls or to the Supplemental Interest Trust for payment to
the Swap Counterparty shall be deemed to have first been distributed from REMIC III to the holders of
the Class 4-X Certificates in respect of REMIC III Regular Interest 4-X-IO and then paid by such holders
to the holders of the LIBOR Certificates or the Supplemental Interest Trust, as applicable. Any amounts
distributed to the holders of the Class 4-A-2 Certificates by the Trust Administrator from amounts it
receives from the Supplemental Interest Account shall be deemed to have first been paid outside of any
REMIC to the holders of the Class 4-X Certificates in respect of their rights with respect to the
Supplemental Interest Trust and then paid outside of any REMIC by such holders to holders of the
Class 4-A-2 Certificates. In addition, the Class 4-X Certificateholders shall be deemed to have entered
into a contractual arrangement with the Class AR and Class AR-L Certificateholders whereby the Class AR
and Class AR-L Certificateholders agree to pay to the Class 4-X Certificateholders on each Distribution
Date amounts that would, in the absence of such contractual agreement, be distributable with respect to
the residual interest in REMIC III pursuant to Section 4.01(II)(d)(xv) (which amounts are expected to be
zero). Thus each Group 4 Senior Certificate and Class 4-M Certificate shall be treated as representing
ownership of not only a REMIC III Regular Interest, but also ownership of an interest in an interest
rate cap contract. Each Class 4-X Certificate shall be treated as representing ownership of not only
two REMIC III Regular Interests, but also ownership of an obligation under an interest rate cap
contract. For purposes of determining the issue price of the REMIC III Regular Interests, the Trust
Administrator shall assume that the interest rate cap contract has a value of $5,000.
For any Distribution Date on which there is a payment under a Group 4 Interest Rate
Cap Agreement based on a notional balance in excess of the Class Principal Balance of the related
Group 4 Certificates, the amount representing such excess payment shall not be an asset of the Trust and,
instead, shall be paid into and distributed out of a separate trust created by this Agreement for the
benefit of the related Group 4 Certificates and shall be distributed to the related Group 4 Certificates
pursuant to Section 4.01(II). The Trust Administrator shall not be responsible for any tax reporting
with respect to such separate trust.
SECTION 2.08. Covenants of the Master Servicer and each Servicer.
The Master Servicer and each Servicer, severally and not jointly, hereby covenants to
the Depositor, the Trustee and the Trust Administrator as follows:
(a) Such Servicer or 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 Mortgage Guaranty
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, the Trustee or the Trust
Administrator and prepared by the Master Servicer or such Servicer pursuant to this Agreement shall
contain any untrue statement of a material fact.
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
SECTION 3.01. Servicers to Service Mortgage Loans.
For and on behalf of the Certificateholders, as independent contractors of the Trust,
(i) each Servicer, severally and not jointly, shall service and administer the related Non-Designated
Mortgage Loans in accordance with the terms of this Agreement and with Accepted Servicing Practices and
with all applicable requirements of the Servicing Criteria, (ii) the Master Servicer shall, in
accordance with Section 3.03 of this Agreement, master service and administer the Non-Designated
Mortgage Loans by overseeing and enforcing the servicing of the Non-Designated Mortgage Loans by the
related Servicer according to the terms of this Agreement and (iii) the Master Servicer shall, in
accordance with the Section 3.20 of this Agreement, master service and administer the Designated
Mortgage Loans by overseeing and enforcing the servicing of the Designated Mortgage Loans by the related
Designated Servicer according to the terms of the related Designated Servicing Agreement. The
obligations of each of SPS, GreenPoint and Xxxxx Fargo hereunder to service and administer the Mortgage
Loans shall be limited to the SPS Serviced Mortgage Loans, GreenPoint Serviced Mortgage Loans and the
Xxxxx Fargo Serviced Mortgage Loans, respectively; and with respect to the duties and obligations of
each Servicer, references herein to related "Mortgage Loans" shall be limited to the SPS Serviced
Mortgage Loans (and the related proceeds thereof and related REO Properties) in the case of SPS, the
GreenPoint Serviced Mortgage Loans (and the related proceeds thereof and related REO Properties) in the
case of GreenPoint and the Xxxxx Fargo Serviced Mortgage Loans (and the related proceeds thereof and
related REO Properties) in the case of Xxxxx Fargo; and in no event shall any Servicer have any
responsibility or liability with respect to any of the other Mortgage Loans. The obligations of the
Master Servicer to master service and administer the Non-Designated Mortgage Loans shall be limited to
the Xxxxx Fargo Serviced Mortgage Loans, the SPS Serviced Mortgage Loans, the GreenPoint Serviced
Mortgage Loans and the Special Serviced Mortgage Loans. In connection with such servicing and
administration of the Non-Designated Mortgage Loans, the Master Servicer and each Servicer shall have
full power and authority, acting alone and/or through Sub-Servicers as provided in Section 3.02 hereof,
to do or cause to be done any and all things that it may deem necessary or desirable in connection with
such servicing and administration, including but not limited to, the power and authority, subject to the
terms hereof (i) to execute and deliver, on behalf of the Certificateholders and the Trust, 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, and (iv) to
effectuate foreclosure or other conversion of the ownership of the Mortgaged Property securing any
Mortgage Loan; provided, that neither the Master Servicer nor a Servicer shall 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, the Trust Administrator or the
Certificateholders under this Agreement. The Master Servicer and each 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 that 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 and each Servicer, in its own name or in the name of the Depositor and the Trust, is
hereby authorized and empowered by the Depositor, the Trust and the Trust Administrator, when the Master
Servicer or such Servicer believes it appropriate in its reasonable judgment, to execute and deliver, on
behalf of the Trust, the Trustee, the Trust Administrator, 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 and each
Servicer shall prepare and deliver to the Depositor and/or the Trustee and/or the Trust Administrator
such documents requiring execution and delivery by either or both of them as are necessary or
appropriate to enable the Master Servicer or such Servicer to master service and administer or service
and administer the Mortgage Loans, as applicable, to the extent that the Master Servicer or such
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 or the Trust Administrator shall
execute such documents and deliver them to the Master Servicer or such Servicer.
In accordance with the standards of the first paragraph of this Section 3.01 and
unless determined in good faith to be a Nonrecoverable Advance, each 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 related to the Non-Designated Mortgage Loans, which advances constitute Servicing
Advances and 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. In no event shall any Servicer be
required to make any Servicing Advance which would constitute a Nonrecoverable Advance. The costs
incurred by a Servicer, if any, in effecting the timely payments of taxes and assessments on the
Mortgaged Properties related to the Non-Designated Mortgage Loans and related insurance premiums shall
not, for the purpose of calculating monthly distributions to the Certificateholders, be added to the
Stated Principal Balances of the related Non-Designated Mortgage Loans, notwithstanding that the terms
of such Non-Designated Mortgage Loans so permit; provided, however, that the limitations contained in
this sentence shall not apply to modifications made pursuant to Section 3.05(a). The parties to this
Agreement acknowledge that Servicing Advances shall be reimbursable pursuant to the terms of this
Agreement and agree that no Servicing Advance shall be rejected or disallowed by any party unless it has
been shown that such Servicing Advance was not made in accordance with this Agreement.
Each Servicer hereby acknowledges that, to the extent such Servicer has previously
serviced some or all of the Non-Designated Mortgage Loans pursuant to another servicing agreement, the
servicing provisions contained in this Agreement shall supersede the servicing provisions contained in
such other servicing agreement from and after the Closing Date, except that such other servicing
agreement shall survive and govern with respect to excess servicing fees and termination without cause.
In addition, the Master Servicer hereby acknowledges that, to the extent the Master Servicer or any
Designated Servicer has previously serviced some or all of the Designated Mortgage Loans pursuant to
another servicing agreement, the provisions contained in the related Designated Servicing Agreement
shall supersede the provisions contained in such other servicing agreement from and after the Closing
Date.
Notwithstanding anything in this Agreement to the contrary, the purchase of any
GreenPoint Serviced Mortgage Loan by any Person shall be subject to the rights of GreenPoint to continue
servicing such GreenPoint Serviced Mortgage Loan for the same Servicing Fee substantially in accordance
with the terms of this Agreement and the purchase of any Xxxxx Fargo Serviced Mortgage Loan by any
Person shall be subject to the rights of Xxxxx Fargo to continue servicing such Xxxxx Fargo Serviced
Mortgage Loan for the same Servicing Fee substantially in accordance with the terms of this Agreement.
With respect to each Mortgage Loan, the related Servicer shall fully furnish, in
accordance with the Fair Credit Reporting Act and its implementing regulations, accurate and complete
information (e.g., favorable and unfavorable) on its borrower credit files to Equifax, Experian and
Trans Union Credit Information Company, on a monthly basis.
Each Servicer is authorized and empowered by the Trustee, on behalf of the
Certificateholders and the Trustee, in its own name or in the name of any Sub-Servicer, when a Servicer
or any Sub-Servicer, as the case may be, believes it appropriate in its best judgment to register any
related Mortgage Loan on the MERS® System, or cause the removal from the registration of such Mortgage
Loan on the MERS® 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.
SECTION 3.02. Subservicing; Enforcement of the Obligations of Sub-Servicers.
(a) The Non-Designated Mortgage Loans may be subserviced by a Sub-Servicer on behalf of the related
Servicer in accordance with the servicing provisions of this Agreement; provided, that the Sub-Servicer
must be a FNMA-approved lender or a FHLMC seller/servicer in good standing. With respect to the
Non-Designated Mortgage Loans, each Servicer may perform any of its servicing responsibilities hereunder
or may cause the Sub-Servicer to perform any such servicing responsibilities on its behalf, but the use
by such Servicer of the Sub-Servicer shall not release such Servicer from any of its obligations
hereunder and such Servicer shall remain responsible hereunder for all acts and omissions of the
Sub-Servicer as fully as if such acts and omissions were those of such Servicer. With respect to the
Non-Designated Mortgage Loans, each Servicer shall pay all fees and expenses of any Sub-Servicer engaged
by such Servicer from its own funds.
A Servicer shall not permit a Sub-Servicer to perform any servicing responsibilities
hereunder with respect to the Non-Designated Mortgage Loans unless that Sub-Servicer first agrees in
writing with such Servicer to deliver an 1123 Certificate, an Assessment of Compliance and an
Accountant's Attestation in such manner and at such times that permits that Servicer to comply with
Sections 13.06, 13.07 and 13.08 of this Agreement.
Notwithstanding the foregoing, with respect to the Non-Designated Mortgage Loans, each
Servicer shall be entitled to outsource one or more separate servicing functions to a Person (each, an
"Outsourcer") that does not meet the eligibility requirements for a Sub-Servicer, so long as such
outsourcing does not constitute the delegation of such Servicer's obligation to perform all or
substantially all of the servicing of the related Non-Designated Mortgage Loans to such Outsourcer. In
such event, the use by a Servicer of any such Outsourcer shall not release the related Servicer from any
of its obligations hereunder and such Servicer shall remain responsible hereunder for all acts and
omissions of such Outsourcer as fully as if such acts and omissions were those of such Servicer, and
such Servicer shall pay all fees and expenses of the Outsourcer from such Servicer's own funds.
A Servicer shall not outsource one or more separate servicing functions hereunder with
respect to the Non-Designated Mortgage Loans to any Subcontractor unless that Subcontractor first agrees
in writing with such Servicer to deliver an Assessment of Compliance and an Accountant's Attestation in
such manner and at such times that permits that Servicer to comply with Sections 13.07 and 13.08 of this
Agreement.
Each Servicer may in connection with its duties as Servicer hereunder enter into
transactions with any of its Affiliates relating to the Non-Designated Mortgage Loans; provided that
(a) such Servicer acts (i) in accordance with Accepted Servicing Practices and the terms of this
Agreement, and (ii) in the ordinary course of business of such Servicer; and (b) the terms of such
transaction are no less favorable to such Servicer than it would obtain in a comparable arm's-length
transaction with a Person that is not an Affiliate of such Servicer. Notwithstanding the preceding
sentence, any such transaction between a Servicer and any of its Affiliates shall not release such
Servicer from any of its obligations hereunder and such Servicer shall remain responsible hereunder for
all acts and omissions of such Affiliate with respect to such Mortgage Loans serviced by it as fully as
if such acts and omissions were those of such Servicer. Any fees and expenses relating to such
transaction between such Servicer and its Affiliate that are not otherwise reimbursable to such Servicer
pursuant to this Agreement shall be borne by the parties thereto and shall not be an expense or fee of
the Trust, the Depositor, the Trustee, the Trust Administrator, the Seller or the Master Servicer.
(b) With respect to any Non-Designated Mortgage Loans, at the cost and expense of a Servicer,
without any right of reimbursement from the Depositor, the Trustee, the Trust Administrator or the
applicable Collection Account, such Servicer shall be entitled to terminate the rights and
responsibilities of its Sub-Servicer and arrange for any servicing responsibilities to be performed by a
successor Sub-Servicer meeting the requirements set forth in Section 3.02(a), provided, however, that
nothing contained herein shall be deemed to prevent or prohibit such Servicer, at such Servicer's
option, from electing to service the related Non-Designated Mortgage Loans itself. In the event that a
Servicer's responsibilities and duties under this Agreement are terminated pursuant to Section 8.01, and
if requested to do so by the Trustee or Trust Administrator or such Servicer shall, at its own cost and
expense terminate the rights and responsibilities of its Sub-Servicer as soon as is reasonably
possible. Each Servicer shall pay all fees, expenses or penalties necessary in order to terminate the
rights and responsibilities of its Sub-Servicer from such Servicer's own funds without any right of
reimbursement from the Depositor, Trustee, Trust Administrator, or the applicable Collection Account.
(c) Notwithstanding any of the provisions of this Agreement relating to agreements or arrangements
between a Servicer and its Sub-Servicer or a Servicer and its Outsourcer, or any reference herein to
actions taken through the Sub-Servicer, the Outsourcer, or otherwise, the related Servicer shall not be
relieved of its obligations to the Depositor, the Trust, Trustee, the Trust Administrator or
Certificateholders and shall be obligated to the same extent and under the same terms and conditions as
if it alone were servicing and administering the related Non-Designated Mortgage Loans. Each Servicer
shall be entitled to enter into an agreement with its Sub-Servicer and Outsourcer for indemnification of
such Servicer by such Sub-Servicer or Outsourcer, as applicable, and nothing contained in this Agreement
shall be deemed to limit or modify such indemnification.
For purposes of this Agreement, a Servicer shall be deemed to have received any
collections, recoveries or payments with respect to the related Non-Designated Mortgage Loans that are
received by a related Sub-Servicer regardless of whether such payments are remitted by the Sub-Servicer
to such Servicer.
Any Subservicing Agreement and any other transactions or services relating to the
Non-Designated Mortgage Loans involving a Sub-Servicer shall be deemed to be between the Sub-Servicer,
and the related Servicer alone, and the Depositor, the Trustee, the Trust Administrator, the Master
Servicer, the other Servicers and the Special Servicer shall have no obligations, duties or liabilities
with respect to a Sub-Servicer including no obligation, duty or liability of the Depositor, Trustee, the
Trust Administrator, the Master Servicer, the Special Servicer or other Servicers to pay a
Sub-Servicer's fees and expenses.
(d) Each Servicer is hereby authorized to enter into a financing or other facility (any such
arrangement, a "Facility") under which (i) such Servicer assigns or pledges to another person (a
"Lender") (A) such Servicer's rights under this Agreement to be reimbursed for any Advances or Servicing
Advances, and (B) any and all rights of such Servicer under this Agreement resulting from such
Servicer's performance of its obligations under this Agreement, including, without limitation, any
Servicing Fees, interest income, Ancillary Income, and other payments received by such Servicer for
servicing the Mortgage Loans related thereto and (ii) the Lender agrees to fund some or all Advances
and/or Servicing Advances required to be made by such Servicer pursuant to this Agreement. No consent
of the Trustee, Trust Administrator, Master Servicer, Certificateholders, Rating Agency or any other
party is required before such Servicer may enter into a Facility; provided, however, that the consent of
the Trust Administrator shall be required before such Servicer may cause to be outstanding at one time
more than one Facility. Notwithstanding the existence of any Facility, such Servicer shall remain
obligated pursuant to this Agreement to make Advances and Servicing Advances pursuant to and as required
by this Agreement, and to perform all duties and obligations of such Servicer under this Agreement and
shall not be relieved of such obligations by virtue of such Facility.
SECTION 3.03. Master Servicing by Master Servicer.
For and on behalf of the Certificateholders, the Master Servicer shall oversee and
enforce the obligation of Xxxxx Fargo, GreenPoint and SPS to service and administer the Xxxxx Fargo
Serviced Mortgage Loans, GreenPoint Serviced Mortgage Loans and SPS Serviced Mortgage Loans,
respectively, in accordance with the terms of this Agreement and shall have full power and authority to
do any and all things which it may deem necessary or desirable in connection with such master servicing
and administration. In performing its obligations hereunder, the Master Servicer shall act in a manner
consistent with this Agreement and with customary and usual standards of practice of prudent mortgage
loan master servicers. Furthermore, the Master Servicer shall oversee and consult with the Servicers as
necessary from time-to-time to carry out the Master Servicer's obligations hereunder, shall receive,
review and evaluate all reports, information and other data provided to the Master Servicer by the
Servicers and shall cause each Servicer to perform and observe the covenants, obligations and conditions
to be performed or observed by such Servicer under this Agreement.
With respect to any Distribution Date, no later than the related Cash Remittance Date,
the Master Servicer shall remit to the Trust Administrator for deposit in the Certificate Account the
amount of the Compensating Interest Payment for the Master Servicer, with respect to each Mortgage Loan,
for the related Prepayment Period, to the extent any of Xxxxx Fargo, GreenPoint, SPS or the related
Designated Servicer, as applicable, defaults in its obligation to make such Compensating Interest
Payment pursuant to Section 3.05. The aggregate of such deposits shall be made from the Master
Servicer's own funds, without reimbursement therefor.
SECTION 3.04. Trustee to Act as Master Servicer or Servicer.
In the event that (A) the Master Servicer shall for any reason no longer be Master
Servicer hereunder or (B) any Servicer shall for any reason no longer be a Servicer hereunder and, with
respect to any Servicer, the Master Servicer shall for any reason no longer be Master Servicer hereunder
(including, in each case, by reason of an Event of Default), the Trustee or its successor shall
thereupon assume all of the rights and obligations of the Master Servicer or such Servicer hereunder
arising thereafter (except that the Trustee shall not be (i) liable for losses of the Master Servicer or
such Servicer pursuant to Section 3.09 hereof or any acts or omissions of the related predecessor of the
Master Servicer or such 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 or (iv) deemed to have made any representations and warranties of the Master
Servicer or such Servicer hereunder); (v) be obligated to perform any obligation of the Master Servicer
or such Servicer under Section 13.06 or Section 13.08 with respect to any period of time during which
the Trustee was not acting as the Master Servicer or Servicer). Any such assumption shall be subject to
Section 8.02 hereof. Notwithstanding the foregoing, if the Trustee has become the successor to the
Master Servicer or a Servicer hereunder, the Trustee may, if it shall be unwilling to so act, or shall,
if it is 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, as the successor to the Master Servicer or a Servicer hereunder
in the assumption of all or any part of the responsibilities, duties or liabilities of the Master
Servicer or such Servicer, as applicable, provided that such successor to the Master Servicer or such
Servicer, as applicable, shall not be deemed to have made any representation or warranty as to any
Mortgage Loan made by the Master Servicer or such Servicer, as applicable.
Each Servicer shall, upon request of the Trust Administrator, but at the expense of
such 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
hereunder by such Servicer 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 Subservicing Agreement or substitute
Subservicing Agreement to the assuming party.
SECTION 3.05. Collection of Mortgage Loans; Collection Accounts; Certificate Account.
(a) Continuously from the date hereof until the principal and interest on all Non-Designated
Mortgage Loans have been paid in full or such Non-Designated Mortgage Loans have become Liquidated
Mortgage Loans, each Servicer shall proceed in accordance with Accepted Servicing Practices to collect
all payments due under each of the related Non-Designated Mortgage Loans when the same shall become due
and payable to the extent consistent with this Agreement and the terms and provisions of any related
Mortgage Guaranty Insurance Policy and shall take special care with respect to the Non-Designated
Mortgage Loans for which a Servicer collects escrow payments in ascertaining and estimating Escrow
Payments and all other charges that will become due and payable with respect to the Non-Designated
Mortgage Loans and the related Mortgaged Properties, to the end that the installments payable by the
related Mortgagors will be sufficient to pay such charges as and when they become due and payable.
Consistent with the foregoing, in connection with Non-Designated Mortgage Loans which it is directly
servicing, each 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 Non-Designated 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 no such Servicer can extend the maturity of any such Non-Designated 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 related Servicer shall make Advances on the
related Non-Designated Mortgage Loans in accordance with the provisions of Section 5.01 during the
scheduled period in accordance with the amortization schedule of such Mortgage Loan without modification
thereof by reason of such arrangements. No Servicer shall 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. Consistent with the foregoing, instances when a Mortgage
Loan is in default or default is reasonably foreseeable (within the meaning of the REMIC Provisions),
the related Servicer may modify the terms of such Mortgage Loan to (1) capitalize to the principal
balance thereof, any unreimbursed Monthly Advances, unreimbursed Servicing Advances, unpaid Servicing
Fees, and related amounts due to the related Servicer with respect to such Mortgage Loan; (2) defer such
amounts to a balloon payment due on the final payment date of such Mortgage Loan; (3) extend the
maturity of any such Mortgage Loan, but in no instance past the date on which the final payment is due
on the latest maturing Mortgage Loan as of the Cut-off Date; and (4) reduce the related Mortgage Rate
(provided that the Mortgage Rate may not be reduced below the Mortgage Rate of such Mortgage Loan
immediately prior to the related first adjustable date), provided, however, that the related Servicer
shall effect such modification only after the related borrower has made no less than three consecutive
monthly payments pursuant the terms of the proposed modification.
(b) Each Servicer shall segregate and hold all funds collected and received pursuant to a
Non-Designated Mortgage Loan separate and apart from any of its own funds and general assets and shall
establish and maintain one or more Collection Accounts, in the form of time deposit or demand accounts,
titled "[Servicer's name], in trust for the Holders of Adjustable Rate Mortgage Trust 2006-3, Adjustable
Rate Mortgage-Backed Pass-Through Certificates, Series 2006-3" or, if established and maintained by a
Sub-Servicer on behalf of a Servicer, "[Sub-Servicer's name], in trust for [Servicer's name]" or
"[Sub-Servicer's name], as agent, trustee and/or bailee of principal and interest custodial account for
[Servicer's name], its successors and assigns, for various owners of interest in [Servicer's name]
mortgage-backed pools. In the event that a Sub-Servicer employs a Sub-Servicer, the Collection Account
shall be titled "[name of Sub-Servicer's sub-servicer], in trust for [Sub-Servicer's name]." Each
Collection Account maintained by each Servicer (other than Xxxxx Fargo), shall be an Eligible Account
acceptable to the Depositor and the Trust Administrator. Each Collection Account maintained by Xxxxx
Fargo shall be an Eligible Account. Funds deposited in a Collection Account may be drawn on by the
related Servicer in accordance with Section 3.08. Any funds deposited in a Collection Account shall
either be invested in Eligible Investments or at all times be fully insured to the full extent permitted
under applicable law.
(c) Each Servicer shall deposit in the applicable Collection Account on a daily basis, within two
Business Days of receipt, unless otherwise indicated, and retain therein, the following collections
remitted by Sub-Servicers or payments received by such Servicer and payments made by such Servicer
subsequent to the Cut-off Date, other than payments of principal and interest due on or before the
Cut-off Date:
(i) all payments on account of principal on the related Non-Designated Mortgage Loans, including
all Principal Prepayments;
(ii) all payments on account of interest on the related Non-Designated Mortgage Loans adjusted to
the per annum rate equal to the Mortgage Rate reduced by the sum of the related Expense Fee
Rate, as applicable;
(iii) all Liquidation Proceeds on the related Non-Designated Mortgage Loans;
(iv) all Insurance Proceeds on the related Non-Designated Mortgage Loans including amounts required
to be deposited pursuant to Section 3.09 (other than proceeds to be held in the Escrow Account
and applied to the restoration or repair of the Mortgaged Property or released to the Mortgagor
in accordance with Section 3.09);
(v) all Advances made by such Servicer pursuant to Section 5.01;
(vi) no later than the withdrawal from the Collection Account pursuant to Section 3.08(a)(ix) each
month, the applicable amount of the Compensating Interest Payment for such Servicer for the
related Prepayment Period. The aggregate of such deposits shall be made from such Servicer's
own funds, without reimbursement therefor;
(vii) any amounts required to be deposited by such Servicer in respect of net monthly income from
REO Property related to any Non-Designated Mortgage Loan pursuant to Section 3.11;
(viii) all Assigned Prepayment Premiums, if applicable; and
(ix) any other amounts required to be deposited hereunder.
The foregoing requirements for deposit into each Collection Account shall be
exclusive, it being understood and agreed that, without limiting the generality of the foregoing, with
respect to the Non-Designated Mortgage Loans, Ancillary Income need not be deposited by such Servicer
into such Collection Account. In addition, notwithstanding the provisions of this Section 3.05, each
Servicer may deduct from amounts received by it, prior to deposit into the applicable Collection
Account, any portion of any Scheduled Payment representing (i) the applicable Servicing Fee and any
other amounts owed to such Servicer pursuant to Section 3.14 and (ii) with respect to each
Non-Designated Mortgage Loan covered by a Lender Paid Mortgage Guaranty Insurance Policy, any amounts
required to effect timely payment of the premiums on such Mortgage Guaranty Insurance Policy pursuant to
Section 3.09(c). In the event that a Servicer shall remit any amount not required to be remitted, it
may at any time withdraw or direct the institution maintaining the related Collection Account to
withdraw such amount from such Collection 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 such Collection Account which describes the amounts
deposited in error in such Collection Account. Each Servicer shall maintain adequate records with
respect to all withdrawals made by it pursuant to this Section 3.05. All funds deposited in a
Collection Account shall be held in trust for the Certificateholders until withdrawn in accordance with
Section 3.08(a).
(d) On or prior to the Closing Date, the Trust Administrator shall establish and maintain, on
behalf of the Certificateholders, the Certificate Account. The Trust Administrator shall, promptly
upon receipt, deposit in the Certificate Account and retain therein the following:
(i) pursuant to Section 3.08(a)(ix), the aggregate amount remitted by each Servicer of
Non-Designated Mortgage Loans to the Trust Administrator and (x) and the aggregate amount
remitted by each Designated Servicer to the Master Servicer or Trust Administrator pursuant to
their respective Designated Servicing Agreements, in each case including any Assigned
Prepayment Premiums;
(ii) any amount deposited by the Trust Administrator pursuant to Section 3.05(e) in connection with
any losses on Eligible Investments;
(iii) all Compensating Interest Payments remitted by the Master Servicer to the Trust Administrator
pursuant to Section 3.03 and Section 3.20(c);
(iv) all Advances remitted by the Master Servicer to the Trust Administrator pursuant to
Section 5.01 and Section 3.20(b); and
(v) any other amounts deposited hereunder which are required to be deposited in the Certificate
Account.
In the event that the Master Servicer or a Servicer shall remit to the Trust
Administrator any amount not required to be remitted, the Master Servicer or such Servicer, as
applicable, may at any time direct the Trust Administrator to withdraw such amount from the Certificate
Account, any provision herein to the contrary notwithstanding. Such direction may be accomplished by
delivering an Officer's Certificate to the Trust Administrator which describes the amounts deposited in
error in the Certificate Account. All funds deposited in the Certificate Account shall be held by the
Trust Administrator in trust for the Certificateholders until disbursed in accordance with this
Agreement or withdrawn in accordance with Section 3.08(b). In no event shall the Trust Administrator
incur liability for withdrawals from the Certificate Account at the direction of the Master Servicer or
any Servicer.
(e) Each institution at which a Collection Account or the Certificate Account is maintained shall
either hold such funds on deposit uninvested or shall invest the funds therein as directed in writing by
the related Servicer, the Trust Administrator or the Depositor, respectively, in Eligible Investments,
which shall mature not later than (i) in the case of a Collection Account, the Cash Remittance Date and
(ii) in the case of the Certificate Account, the Business Day immediately preceding the Distribution
Date, or on the Distribution Date, with respect to Eligible Investments invested with an affiliate of
the Trust Administrator. All income and gain net of any losses realized from any such balances or
investment of funds on deposit in a Collection Account shall be for the benefit of the related Servicer
as servicing compensation and shall be remitted to it monthly as provided herein. The amount of any
realized losses in a Collection Account incurred in any such account in respect of any such investments
shall promptly be deposited by the related Servicer (from its own funds) in the related Collection
Account. Neither the Trustee nor the Trust Administrator shall be liable for the amount of any loss
incurred in respect of any investment or lack of investment of funds held in a Collection Account and
made in accordance with this Section 3.05. All income and gain net of any losses realized from any such
investment of funds on deposit in the Certificate Account shall be for the benefit of the Trust
Administrator as compensation and shall be remitted to it monthly as provided herein. The amount of any
realized losses in the Certificate Account incurred in any such account in respect of any such
investments shall promptly be deposited by the Trust Administrator (from its own funds) in the
Certificate Account.
(f) Each Servicer, other than Xxxxx Fargo, shall give notice to the Trustee, the Trust
Administrator, the Seller, each Rating Agency and the Depositor of any proposed change of the location
of the related Collection Account prior to any change thereof. Xxxxx Fargo shall give notice to the
Depositor of any proposed change of the location of the related Collection Account prior to any change
thereof and, upon receipt of such notice, the Depositor shall give notice to the Trustee, the Trust
Administrator, the Seller and each Rating Agency. The Trust Administrator shall give notice to the
Master Servicer and each Servicer, the Seller, each Rating Agency, the Trustee and the Depositor of any
proposed change of the location of the Certificate Account prior to any change thereof.
SECTION 3.06. Establishment of and Deposits to Escrow Accounts; Permitted Withdrawals from Escrow
Accounts; Payments of Taxes, Insurance and Other Charges.
(a) To the extent required by the related Mortgage Note and not violative of applicable law, the
applicable Servicer shall segregate and hold all funds collected and received pursuant to a
Non-Designated Mortgage Loan constituting Escrow Payments separate and apart from any of its own funds
and general assets and shall establish and maintain one or more Escrow Accounts, in the form of time
deposit or demand accounts, titled, in the case of Servicers other than SPS, GreenPoint and Xxxxx Fargo,
"Adjustable Rate Mortgage Trust 2006-3, Adjustable Rate Mortgage-Backed Pass-Through Certificates,
Series 2006-3," in the case of Xxxxx Fargo, "Xxxxx Fargo Bank, N.A., as Servicer for Adjustable Rate
Mortgage Trust 2006-3, Adjustable Rate Mortgage-Backed Pass-Through Certificates, Series 2006-3," in
the case of SPS, "Select Portfolio Servicing, Inc., as Servicer for Adjustable Rate Mortgage
Trust 2006-3, Adjustable Rate Mortgage-Backed Pass-Through Certificates, Series 2006-3," in the case of
GreenPoint, "GreenPoint Mortgage Funding Inc., as Servicer for Adjustable Rate Mortgage Trust 2006-3,
Adjustable Rate Mortgage Backed Pass Through Certificates, Series 2006-3," or, if established and
maintained by a Sub-Servicer on behalf of a Servicer, "[Sub-Servicer's name], in trust for [Servicer's
name]" or "[Sub-Servicer's name], as agent, trustee and/or bailee of taxes and insurance custodial
account for [Servicer's name], its successors and assigns, for various owners of interest in [Servicer's
name] mortgage backed pools. In the event that a Sub-Servicer employs a sub-servicer, the Escrow
Accounts shall be titled "[name of Sub-Servicer's sub-servicer] in trust for [Sub-Servicer's name]. The
Escrow Accounts shall be Eligible Accounts. Funds deposited in the Escrow Account may be drawn on by the
related Servicer in accordance with Section 3.06(d).
(b) Each Servicer shall deposit or cause to be deposited in its Escrow Account or Accounts on a
daily basis within two Business Days of receipt and retain therein:
(i) all Escrow Payments collected on account of the related Non-Designated Mortgage Loans, for the
purpose of effecting timely payment of any such items as required under the terms of this
Agreement; and
(ii) all amounts representing Insurance Proceeds which are to be applied to the restoration or
repair of any Mortgaged Property related to a Non-Designated Mortgage Loan.
(c) Each Servicer shall make withdrawals from the Escrow Account only to effect such payments as
are required under this Agreement, as set forth in Section 3.06(d). Each Servicer shall be entitled to
retain any interest paid on funds deposited in the related Escrow Account by the depository institution,
other than interest on escrowed funds required by law to be paid to the Mortgagor. To the extent
required by law, the applicable Servicer shall pay interest on escrowed funds to the Mortgagor
notwithstanding that the Escrow Account may be non interest bearing or that interest paid thereon is
insufficient for such purposes.
(d) Withdrawals from the Escrow Account or Accounts may be made or caused to be made by the related
Servicer only:
(i) to effect timely payments of ground rents, taxes, assessments, water rates, mortgage insurance
premiums, condominium charges, fire and hazard insurance premiums or other items constituting
Escrow Payments for the related Mortgage;
(ii) to reimburse such Servicer for any Servicing Advances made by the such Servicer with respect to
a related Non-Designated Mortgage Loan, but only from amounts received on the related
Non-Designated Mortgage Loan which represent late collections of Escrow Payments thereunder;
(iii) to refund to any Mortgagor any funds found to be in excess of the amounts required under the
terms of the related Non-Designated Mortgage Loan;
(iv) for transfer to the related Collection Account to reduce the principal balance of the related
Non-Designated Mortgage Loan in accordance with the terms of the related Mortgage and Mortgage
Note;
(v) for application to restore or repair of the Mortgaged Property related to a Non-Designated
Mortgage Loan in accordance with the procedures outlined in Section 3.09(e);
(vi) to pay to the related Servicer, or any Mortgagor related to a Non-Designated Mortgage Loan to
the extent required by law, any interest paid on the funds deposited in such Escrow Account;
(vii) to clear and terminate such Escrow Account on the termination of this Agreement; and
(viii) to remove funds inadvertently placed in the Escrow account by the related Servicer.
(e) With respect to each Non-Designated Mortgage Loan, the applicable Servicer shall maintain
accurate records reflecting the status of ground rents and taxes and any other item which may become a
lien senior to the lien of the related Mortgage and the status of Mortgage Guaranty Insurance Policy
premiums, and fire and hazard insurance coverage and shall obtain, from time to time, all bills for the
payment of such charges (including renewal premiums) and shall effect or cause to be effected payment
thereof prior to the applicable penalty or termination date.
SECTION 3.07. Access to Certain Documentation and Information Regarding the Non-Designated Mortgage
Loans; Inspections.
(a) The Master Servicer and each Servicer shall afford the Depositor, the Trustee and the Trust
Administrator reasonable access to all records and documentation regarding the Non-Designated Mortgage
Loans and all accounts, insurance information and other matters relating to this Agreement, such access
being afforded without charge, but only upon reasonable written request and during normal business hours
at the office designated by the Master Servicer or such Servicer. In addition, each Servicer shall
afford the Master Servicer reasonable access to all records and documentation regarding the
Non-Designated Mortgage Loans and all accounts, insurance information and other matters relating to this
Agreement, such access being afforded without charge, but only upon reasonable written request and
during normal business hours at the office designated by such Servicer. In addition, each Servicer
shall provide to the Special Servicer reasonable access to all records and documentation regarding the
Non-Designated Mortgage Loans serviced by it that become Special Serviced Mortgage Loans.
(b) Each Servicer, separately with respect to the Non-Designated Mortgage Loans each directly
services, shall inspect the related Mortgaged Properties as often as deemed necessary by such Servicer
in such party's sole discretion, to assure itself that the value of such Mortgaged Property is being
preserved. In addition, if any Non-Designated Mortgage Loan is more than 60 days delinquent, such
Servicer, as applicable, shall conduct subsequent inspections in accordance with Accepted Servicing
Practices or as may be required by the primary mortgage guaranty insurer. Each Servicer shall keep a
written or electronic report of each such inspection.
SECTION 3.08. Permitted Withdrawals from the Collection Accounts and Certificate Account.
(a) Each Servicer may from time to time make withdrawals from the related Collection Account for
the following purposes:
(i) to pay to such Servicer (to the extent not previously retained by such Servicer) the servicing
compensation to which it is entitled pursuant to Section 3.14, and to pay to such Servicer, as
additional servicing compensation, earnings on or investment income with respect to funds in or
credited to such Collection Account, and with respect to Xxxxx Fargo, to pay (to the extent not
previously retained by Xxxxx Fargo) any REO Disposition Fee to which it is entitled pursuant to
Section 3.11(e);
(ii) to reimburse such Servicer for unreimbursed Advances made by it, such right of reimbursement
pursuant to this subclause (ii) being limited to amounts received on the Non-Designated
Mortgage Loan(s) in respect of which any such Advance was made (including without limitation,
late recoveries of payments, Liquidation Proceeds and Insurance Proceeds to the extent received
by such Servicer);
(iii) to reimburse such Servicer for any Nonrecoverable Advance previously made or any amount
expended pursuant to Section 3.11(a);
(iv) to reimburse such Servicer for (A) unreimbursed Servicing Advances or such Servicer's right to
reimbursement pursuant to this clause (A) with respect to any Non-Designated Mortgage Loan
being limited to amounts received on such Non-Designated Mortgage Loan which represent late
payments of principal and/or interest (including, without limitation, Liquidation Proceeds and
Insurance Proceeds with respect to such Mortgage Loan) respecting which any such advance was
made and (B) for unpaid Servicing Fees as provided in Section 3.11 hereof;
(v) to pay to the purchaser, with respect to each Non-Designated 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;
(vi) to make any payments required to be made pursuant to Section 2.07(g);
(vii) to reimburse the Seller, such Servicer or the Depositor for expenses incurred by any of them
and reimbursable pursuant to Section 7.03 hereof;
(viii) to withdraw any amount deposited in such Collection Account and not required to be deposited
therein;
(ix) with respect to the Non-Designated Mortgage Loans, on the Cash Remittance Date, to withdraw an
amount equal to the portion of (a) with respect to the Mortgage Loans in Loan Group 1, Loan
Group 2 and Loan Group 3, the Available Distribution Amount and (b) with respect to the
Mortgage Loans in Loan Group 4, the Interest Remittance Amount and Principal Remittance Amount,
in each case applicable to the Mortgage Loans serviced by such Servicer, who shall remit the
aggregate of such amounts to the Trust Administrator for deposit in the Certificate Account;
(x) with respect to each Non-Designated Mortgage Loan covered by a Lender Paid Mortgage Guaranty
Insurance Policy, to effect timely payment of the related premiums on such Mortgage Guaranty
Insurance Policy, as applicable, pursuant to Section 3.09(c), to the extent not deducted by
such Servicer prior to deposit into the applicable Collection Account pursuant to
Section 3.05(c);
(xi) on or prior to 4:00 p.m., New York City time, on the Cash Remittance Date preceding each
Distribution Date, each applicable Servicer shall withdraw an amount equal to the sum of all
Assigned Prepayment Premiums received during the related Prepayment Period applicable to the
Mortgage Loans serviced by such Servicer, and remit such amount to the Trust Administrator for
deposit in the Certificate Account;
(xii) to clear and terminate such Collection Account upon termination of this Agreement pursuant to
Section 11.01 hereof; and
(xiii) to reimburse such Servicer for any Capitalization Reimbursement Amounts not previously
reimbursed.
Each Servicer shall keep and maintain separate accounting, on a Non-Designated
Mortgage Loan by Mortgage Loan basis, for the purpose of justifying any withdrawal from the related
Collection Account pursuant to such subclauses (i), (ii), (iv) and (v). Prior to making any withdrawal
from a Collection Account pursuant to subclause (iii) for reimbursement of a Nonrecoverable Advance, the
related Servicer shall deliver to the Trust Administrator a certificate of a Servicing Officer
indicating the amount of any previous Advance or Servicing Advance determined by such Servicer to be a
Nonrecoverable Advance and identifying the related Non-Designated Mortgage Loans(s), and their
respective portions of such Nonrecoverable Advance. In connection with the payment of a Purchase Price,
if a Servicer is not required to remit unreimbursed Advances and Xxxxxxxxx Advances as specified in the
definition of Purchase Price, such Servicer shall be deemed to have been reimbursed for such amount.
If a Servicer fails to remit to the Master Servicer for distribution to the
Certificateholders any payment, including any Advance to be made by the Servicer on a Cash Remittance
Date (without regard to any grace period), the Servicer shall pay to the Master Servicer, for the
account of the Master Servicer, interest on such late remittance from and including the Cash Remittance
Date to but excluding the date on which such remittance is made, at an annual rate equal to the Federal
Funds Rate plus one percentage point (but in no event greater than the maximum permitted by law).
(b) The Trust Administrator shall withdraw funds from the Certificate 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 Section 2.07). In
addition, the Trust Administrator may from time to time make withdrawals from the Certificate Account
for the following purposes:
(i) to pay to itself any investment income earned for the related Distribution Date, and to pay to
itself or the Master Servicer any other amounts to which it or the Master Servicer is entitled
to reimbursement or payment under the terms of this Agreement;
(ii) to withdraw and return to the Master Servicer or the applicable Servicer for deposit to the
applicable Collection Account any amount deposited in the Certificate Account and not required
to be deposited therein; and
(iii) to clear and terminate the Certificate Account upon termination of the Agreement pursuant to
Section 11.01 hereof.
SECTION 3.09. Maintenance of Hazard Insurance; Mortgage Impairment Insurance and Mortgage Guaranty
Insurance Policy; Claims; Restoration of Mortgaged Property.
(a) Each Servicer shall cause to be maintained for each related Non-Designated Mortgage Loan hazard
insurance such that all buildings upon the related Mortgaged Property are insured by a generally
acceptable insurer rated either: "V" or better in the current Best's Key Rating Guide ("Best's") or
acceptable to FNMA or FHLMC against loss by fire, hazards of extended coverage and such other hazards as
are customary in the area where the related Mortgaged Property is located, in an amount which is at
least equal to the lesser of (i) the replacement value of the improvements securing such Non-Designated
Mortgage Loan and (ii) the greater of (A) the outstanding principal balance of such Non-Designated
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 upon origination of the Non-Designated Mortgage Loan, the related Mortgaged
Property was located in an area identified in the Federal Register by the Federal Emergency Management
Agency as having special flood hazards (and such flood insurance has been made available), the related
Servicer shall cause a flood insurance policy to be maintained with respect to such Non-Designated
Mortgage Loan. Such policy shall meet the requirements of the current guidelines of the Federal
Insurance Administration and be in an amount representing coverage equal to the lesser of (i) the
minimum amount required, under the terms of coverage, to compensate for any damage or loss on a
replacement cost basis (or the unpaid principal balance of the mortgage if replacement cost coverage is
not available for the type of building insured) and (ii) the maximum amount of insurance which is
available under the Flood Disaster Protection Act of 1973, as amended.
If a Mortgage related to a Non-Designated Mortgage Loan is secured by a unit in a
condominium project, the related Servicer shall verify that the coverage required of the owner's
association, including hazard, flood, liability, and fidelity coverage, is being maintained in
accordance with the requirements of the related Servicer for mortgage loans that it services on its own
account.
Each Servicer shall cause to be maintained on each Mortgaged Property related to a
Non-Designated Mortgage Loan such other additional special hazard insurance as may be required pursuant
to such applicable laws and regulations as shall at any time be in force and as shall require such
additional insurance, or pursuant to the requirements of any Mortgage Guaranty Insurance Policy insurer,
or as may be required to conform with Accepted Servicing Practices to the extent permitted by the
Mortgage Note, the Mortgage or applicable law provided that the related Servicer shall not be required
to bear the cost of such insurance.
All policies required hereunder shall name the related Servicer as loss payee and
shall be endorsed with standard or union mortgagee clauses, without contribution, which shall provide
for prior written notice of any cancellation, reduction in amount or material change in coverage.
Each Servicer shall not interfere with the Mortgagor's freedom of choice at the
origination of such Non-Designated Mortgage Loan in selecting either his insurance carrier or agent,
provided, however, that such Servicer shall not accept any such insurance policies from insurance
companies unless such companies are rated: B:III or better in Best's or acceptable to FNMA or FHLMC and
are licensed to do business in the jurisdiction in which the Mortgaged Property is located. The related
Servicer shall determine that such policies provide sufficient risk coverage and amounts, that they
insure the property owner, and that they properly describe the property address.
Pursuant to Section 3.05, any amounts collected by a Servicer under any such policies
(other than amounts to be deposited in the related Escrow Account and applied to the restoration or
repair of the related Mortgaged Property, or property acquired in liquidation of the Non-Designated
Mortgage Loan, or to be released to the Mortgagor, in accordance with such Servicer's normal servicing
procedures) shall be deposited in the related Collection Account (subject to withdrawal pursuant to
Section 3.08(a)).
Any cost incurred by a Servicer in maintaining any such insurance shall not, for the
purpose of calculating monthly distributions to the Certificateholders or remittances to the Trust
Administrator for their benefit, be added to the principal balance of the Non-Designated Mortgage Loan,
notwithstanding that the terms of the Non-Designated Mortgage Loan so permit; provided, however, that
the limitations contained in this sentence shall not apply to modifications made pursuant to
Section 3.05(a). Such costs shall constitute a Servicing Advance and will be reimbursable to the related
Servicer 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 related to a Non-Designated Mortgage
Loan or maintained on property acquired in respect of a Mortgage related to a Non-Designated Mortgage
Loan other than pursuant to such applicable laws and regulations as shall at any time be in force and as
shall require such additional insurance.
(b) In the event that a Servicer shall obtain and maintain a blanket policy insuring against losses
arising from fire and hazards covered under extended coverage on all of the related Non-Designated
Mortgage Loans, then, to the extent such policy provides coverage in an amount equal to the amount
required pursuant to Section 3.09(a) and otherwise complies with all other requirements of
Section 3.09(a), it shall conclusively be deemed to have satisfied its obligations as set forth in
Section 3.09(a). Any amounts collected by a Servicer under any such policy relating to a Non-Designated
Mortgage Loan shall be deposited in the related Collection Account subject to withdrawal pursuant to
Section 3.08(a). Such policy may contain a deductible clause, in which case, in the event that there
shall not have been maintained on the related Mortgaged Property a policy complying with
Section 3.09(a), and there shall have been a loss which would have been covered by such policy, the
related Servicer shall deposit in the related Collection Account at the time of such loss the amount not
otherwise payable under the blanket policy because of such deductible clause, such amount to be
deposited from such Servicer's funds, without reimbursement therefor. Upon request of the Trust
Administrator, a Servicer shall cause to be delivered to the Trust Administrator a certified true copy
of such policy and a statement from the insurer thereunder that such policy shall in no event be
terminated or materially modified without 30 days' prior written notice to the Trust Administrator. In
connection with its activities as Servicer of the related Non-Designated Mortgage Loans, such Servicer
agrees to present, on behalf of itself, the Depositor, and the Trust Administrator for the benefit of
the Certificateholders, claims under any such blanket policy.
(c) With respect to each Non-Designated Mortgage Loan with a Loan-to-Value Ratio in excess of 80%
which the Seller represented to be covered by a Mortgage Guaranty Insurance Policy as of the Cut-off
Date, the related Servicer shall, without any cost to the Depositor or Trust Administrator, maintain or
cause the Mortgagor to maintain in full force and effect a Mortgage Guaranty Insurance Policy insuring
that portion of the Non-Designated Mortgage Loan in excess of 75% of value, and shall pay or shall cause
the Mortgagor to pay, the premium thereon on a timely basis, until the loan-to-value ratio of such
Non-Designated Mortgage Loan is reduced to 80%, based on either (i) a current appraisal of the Mortgaged
Property or (ii) the appraisal of the Mortgaged Property obtained at the time the Non-Designated
Mortgage Loan was originated. In the event that such Mortgage Guaranty Insurance Policy shall be
terminated prior to the loan-to-value ratio of such Non-Designated Mortgage Loan being reduced to 80%,
the related Servicer shall obtain from another Qualified Insurer a comparable replacement policy, with a
total coverage equal to the remaining coverage of such terminated Mortgage Guaranty Insurance Policy. If
the insurer shall cease to be a Qualified Insurer, the related Servicer shall determine whether
recoveries under the Mortgage Guaranty Insurance Policy are jeopardized for reasons related to the
financial condition of such insurer, it being understood that such Servicer shall in no event have any
responsibility or liability for any failure to recover under the Mortgage Guaranty Insurance Policy for
such reason. If the related Servicer determines that recoveries are so jeopardized, it shall notify the
Mortgagor, if required, and obtain from another Qualified Insurer a replacement insurance policy. The
related Servicer shall not take any action which would result in noncoverage under any applicable
Mortgage Guaranty Insurance Policy of any loss which, but for the actions of such Servicer would have
been covered thereunder. In connection with any assumption or substitution agreement entered into or to
be entered into pursuant to Section 3.10, each Servicer shall promptly notify the insurer under the
related Mortgage Guaranty Insurance Policy, if any, of such assumption or substitution of liability in
accordance with the terms of such Mortgage Guaranty Insurance Policy and shall take all actions which
may be required by such insurer as a condition to the continuation of coverage under such Mortgage
Guaranty Insurance Policy, provided that such required actions are in compliance with all applicable
law. If such Mortgage Guaranty Insurance Policy is terminated as a result of such assumption or
substitution of liability, the related Servicer shall obtain a replacement Mortgage Guaranty Insurance
Policy as provided above; provided that under applicable law and the terms of the related Mortgage Note
and Mortgage the cost of such policy may be charged to the successor Xxxxxxxxx.
With respect to each Non-Designated Mortgage Loan covered by a Lender Paid Mortgage
Guaranty Insurance Policy, the applicable Servicer shall effect timely payment of the premiums on such
Mortgage Guaranty Insurance Policy from amounts on deposit in the Collection Account, or deducted by
such Servicer prior to deposit into the applicable Collection Account pursuant to Section 3.05(c) with
respect to such Non-Designated Mortgage Loan. If amounts on deposit in the Collection Account, or
deducted by such Servicer prior to deposit into the applicable Collection Account pursuant to
Section 3.05(c) with respect to such Non-Designated Mortgage Loan are not sufficient to pay the premiums
on such Mortgage Guaranty Insurance Policy, the applicable Servicer shall effect timely payment of such
premiums, and such costs shall be recoverable by such Servicer from the related Liquidation Proceeds or
otherwise as a Servicing Advance pursuant to Section 3.08(a). With respect to each Non-Designated
Mortgage Loan covered by a Mortgage Guaranty Insurance Policy that is not a Lender Paid Mortgage
Guaranty Insurance Policy, the applicable Servicer shall effect timely payment of the premiums on such
Mortgage Guaranty Insurance Policy, and such costs not otherwise recoverable from the Mortgagor shall be
recoverable by such Servicer from the related Liquidation Proceeds or otherwise as a Servicing Advance
pursuant to Section 3.08(a).
(d) In connection with its activities as servicer, each Servicer shall prepare and present, on
behalf of itself, the Depositor, the Trust, the Trustee, the Trust Administrator and the
Certificateholders, claims to the insurer under any Mortgage Guaranty Insurance Policy related to a
Non-Designated Mortgage Loan in a timely fashion in accordance with the terms of such Mortgage Guaranty
Insurance Policy and, in this regard, to take such reasonable action as shall be necessary to permit
recovery under any Mortgage Guaranty Insurance Policy respecting defaulted Non-Designated Mortgage
Loans. Pursuant to Section 3.05, any amounts collected by a Servicer under any Mortgage Guaranty
Insurance Policy shall be deposited in the related Collection Account, subject to withdrawal pursuant to
Section 3.08.
(e) With respect to any Non-Designated Mortgage Loan, each Servicer need not obtain the approval of
the Trustee or the Trust Administrator prior to releasing any Insurance Proceeds to the related
Mortgagor to be applied to the restoration or repair of the related Mortgaged Property if such release
is in accordance with Accepted Servicing Practices. At a minimum, each Servicer shall comply with the
following conditions in connection with any such release of Insurance Proceeds:
(i) such Servicer shall receive satisfactory independent verification of completion of repairs and
issuance of any required approvals with respect thereto;
(ii) such Servicer shall take all steps necessary to preserve the priority of the lien of the
Mortgage, including, but not limited to requiring waivers with respect to mechanics' and
materialmen's liens; and
(iii) pending repairs or restoration, such Servicer shall place the Insurance Proceeds in the related
Escrow Account.
(f) With respect to any Non-Designated Mortgage Loan, if the Trust Administrator is named as an
additional loss payee, the related Servicer is hereby empowered to endorse any loss draft issued in
respect of such a claim in the name of the Trustee or the Trust Administrator.
SECTION 3.10. Enforcement of Due on Sale Clauses; Assumption Agreements.
(a) With respect to any Non-Designated Mortgage Loan, each Servicer shall use its best efforts to
enforce any "due-on-sale" provision contained in any related Mortgage or Mortgage Note and to deny
assumption by the person to whom the Mortgaged Property has been or is about to be sold whether by
absolute conveyance or by contract of sale, and whether or not the Mortgagor remains liable on the
Mortgage and the Mortgage Note. When the Mortgaged Property has been conveyed by the Mortgagor, the
related Servicer shall, to the extent it has knowledge of such conveyance, exercise its rights to
accelerate the maturity of such Non-Designated Mortgage Loan under the "due-on-sale" clause applicable
thereto, provided, however, that such Servicer shall not exercise such rights if prohibited by law from
doing so or if the exercise of such rights would impair or threaten to impair any recovery under the
related Mortgage Guaranty Insurance Policy, if any.
(b) With respect to any Non-Designated Mortgage Loan, if a Servicer reasonably believes it is
unable under applicable law to enforce such "due-on-sale" clause, such Servicer shall enter into (i) an
assumption and modification agreement with the person to whom such property has been conveyed, pursuant
to which such person becomes liable under the Mortgage Note and the original Mortgagor remains liable
thereon or (ii) in the event such Servicer is unable under applicable law to require that the original
Mortgagor remain liable under the Mortgage Note, a substitution of liability agreement with the
purchaser of the Mortgaged Property pursuant to which the original Mortgagor is released from liability
and the purchaser of the Mortgaged Property is substituted as Mortgagor and becomes liable under the
Mortgage Note. Notwithstanding the foregoing, a Servicer shall not be deemed to be in default under this
Section 3.10 by reason of any transfer or assumption which such Servicer reasonably believes it is
restricted by law from preventing, for any reason whatsoever. In connection with any such assumption, no
material term of the Mortgage Note, including without limitation, the Mortgage Rate borne by the related
Mortgage Note, the term of the Non-Designated Mortgage Loan or the outstanding principal amount of the
Non-Designated Mortgage Loan shall be changed.
(c) To the extent that any Non-Designated Mortgage Loan is assumable, the related Servicer shall
inquire diligently into the creditworthiness of the proposed transferee, and shall use the underwriting
criteria for approving the credit of the proposed transferee which are used by FNMA with respect to
underwriting mortgage loans of the same type as the Non-Designated Mortgage Loans. If the credit of the
proposed transferee does not meet such underwriting criteria, the related Servicer diligently shall, to
the extent permitted by the Mortgage or the Mortgage Note and by applicable law, accelerate the maturity
of the Non-Designated Mortgage Loan.
(d) With respect to any Non-Designated Mortgage Loan, subject to each Servicer's duty to enforce
any due-on-sale clause to the extent set forth in this Section 3.10, in any case in which the related
Mortgaged Property has been conveyed to a Person by the related 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 Non-Designated Mortgage Loan, such 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. Together with each such substitution, assumption or other agreement or
instrument delivered to the Trustee for execution by it, the related 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 related Servicer shall notify the Trustee and the Trust Administrator that
any such substitution or assumption agreement has been completed by forwarding to the Trustee and the
Trust Administrator a copy of such substitution or assumption agreement, and shall forward the original
to the related Custodian which shall be added to the related Mortgage File and shall, for all purposes,
be considered a part of such Mortgage File to the same extent as all other documents and instruments
constituting a part thereof. Any fee collected by a Servicer for entering into an assumption or
substitution of liability agreement shall be retained by such Servicer as additional servicing
compensation.
SECTION 3.11. Realization Upon Defaulted Mortgage Loans; Repurchase of Certain Mortgage Loans.
(a) Each Servicer shall use reasonable efforts to foreclose upon or otherwise comparably convert
the ownership of properties securing such of the related Non-Designated 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, each Servicer shall take
such action as (i) such Servicer would take under similar circumstances with respect to a similar
mortgage loan held for its own account for investment, (ii) shall be consistent with Accepted Servicing
Practices, (iii) such Servicer shall determine consistently with Accepted Servicing Practices to be in
the best interest of the Trust and Certificateholders, and (iv) is consistent with the requirements of
the insurer under any Required Insurance Policy; provided, however, that such 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 related Non-Designated Mortgage Loan after reimbursement to itself of
such expenses and (ii) that such expenses will be recoverable to it through Liquidation Proceeds. Any
funds expended by any Servicer pursuant to this Section 3.11(a) shall be reimbursable in full pursuant
to Section 3.08(a)(iii). The related 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 Liquidation Proceeds with respect to the related Mortgaged Property or otherwise as a
Servicing Advance in accordance with Section 3.08(a).
With respect to any Non-Designated Mortgage Loan, notwithstanding anything to the
contrary contained in this Agreement, in connection with a foreclosure or acceptance of a deed in lieu
of foreclosure, in the event the related Servicer has reasonable cause to believe that the related
Mortgaged Property is contaminated by hazardous or toxic substances or wastes, or if the Trust
Administrator otherwise requests, an environmental inspection or review of such Mortgaged Property
conducted by a qualified inspector shall be arranged for by such Servicer. Upon completion of the
inspection, the related Servicer shall promptly provide the Trust Administrator with a written report of
environmental inspection.
In the event the environmental inspection report indicates that the Mortgaged Property
is contaminated by hazardous or toxic substances or wastes, the related Servicer shall not proceed with
foreclosure or acceptance of a deed in lieu of foreclosure if the estimated costs of the environmental
clean up, as estimated in the environmental inspection report, together with the Servicing Advances and
Advances made by such Servicer and the estimated costs of foreclosure or acceptance of a deed in lieu of
foreclosure exceeds the estimated value of the Mortgaged Property. If however, the aggregate of such
clean up and foreclosure costs, Advances and Servicing Advances are less than or equal to the estimated
value of the Mortgaged Property, then the related Servicer may, in its reasonable judgment and in
accordance with Accepted Servicing Practices, choose to proceed with foreclosure or acceptance of a deed
in lieu of foreclosure and such Servicer shall be reimbursed for all reasonable costs associated with
such foreclosure or acceptance of a deed in lieu of foreclosure and any related environmental clean up
costs, as applicable, from the related Liquidation Proceeds, or if the Liquidation Proceeds are
insufficient to fully reimburse such Servicer, such Servicer shall be entitled to be reimbursed from
amounts in the related Collection Account pursuant to Section 3.08(a) hereof. In the event the related
Servicer does not proceed with foreclosure or acceptance of a deed in lieu of foreclosure pursuant to
the first sentence of this paragraph, such Servicer shall be reimbursed for all Advances and Servicing
Advances made with respect to the related Mortgaged Property from the related Collection Account
pursuant to Section 3.08(a) hereof, and such Servicer shall have no further obligation to service such
Non-Designated Mortgage Loan under the provisions of this Agreement.
(b) With respect to any REO Property related to a Non-Designated Mortgage Loan, the deed or
certificate of sale shall, subject to applicable laws, 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 related Servicer shall ensure that the title to such REO Property references
this Agreement and the Trustee capacity hereunder. Pursuant to its efforts to sell such REO Property,
the related Servicer shall in accordance with Accepted Servicing Practices manage, conserve, protect and
operate each REO Property for the purpose of its prompt disposition and sale. The related Servicer,
either itself or through an agent selected by such Servicer, shall manage, conserve, protect and operate
the REO Property in the same manner that it manages, conserves, protects and operates other foreclosed
property for its own account, and in the same manner that similar property in the same locality as the
REO Property is managed. Upon request, the related Servicer shall furnish to the Trust Administrator on
or before each Distribution Date a statement with respect to any REO Property covering the operation of
such REO Property for the previous calendar month and such Servicer's efforts in connection with the
sale of such REO Property and any rental of such REO Property incidental to the sale thereof for the
previous calendar month. That statement shall be accompanied by such other information as the Trust
Administrator shall reasonably request and which is necessary to enable the Trust Administrator 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 related Collection Account no later than the close of
business on each Determination Date. The related Servicer shall perform the tax reporting and
withholding required by Sections 1445 and 6050J of the Code with respect to foreclosures and
abandonments, the tax reporting required by Section 6050H of the Code with respect to the receipt of
mortgage interest from individuals and any tax reporting required by Section 6050P of the Code with
respect to the cancellation of indebtedness by certain financial entities, by preparing such tax and
information returns as may be required, in the form required, and delivering the same to the Trust
Administrator for filing.
To the extent consistent with Accepted Servicing Practices, the related Servicer shall
also maintain on each REO Property related to a Non-Designated Mortgage Loan fire and hazard insurance
with extended coverage in an amount which is equal to the outstanding principal balance of the related
Non-Designated Mortgage Loan (as reduced by any amount applied as a reduction of principal at the time
of acquisition of the REO Property), liability insurance and, to the extent required and available under
the Flood Disaster Protection Act of 1973, as amended, flood insurance in the amount required above.
(c) 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 related Servicer shall dispose of
such Mortgaged Property prior to three years after the end of the calendar year of its acquisition by
the Trust Fund unless (i) the Trustee and the Trust Administrator 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 such three-year period 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, in which case the Trust
Fund may continue to hold such Mortgaged Property (subject to any conditions contained in such Opinion
of Counsel) or (ii) the applicable Servicer shall have applied for, prior to the expiration of such
three-year period, an extension of such three-year period in the manner contemplated by Section 856(e)(3)
of the Code, in which case the three-year period shall be extended by the applicable extension 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 related 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 obligors 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 related Servicer shall 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.
(d) The decision of a Servicer to foreclose on a defaulted Non-Designated Mortgage Loan shall be
subject to a determination by such 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 such Servicer for expenses incurred (including any property or other
taxes) in connection with such management and net of applicable accrued and unpaid Servicing Fees, and
unreimbursed Advances and Servicing Advances, shall be applied to the payment of principal of and
interest on the related defaulted Non-Designated Mortgage Loans (with interest accruing as though such
Non-Designated 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 related Collection 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 Non-Designated Mortgage Loan for such calendar month, such
excess shall be considered to be a partial prepayment of principal of the related Non-Designated
Mortgage Loan.
(e) The proceeds from any liquidation of a Non-Designated Mortgage Loan, as well as any income from
a related REO Property, will be applied in the following order of priority: first, to reimburse the
related Servicer for any related unreimbursed Servicing Advances and Servicing Fees, and with respect to
Xxxxx Fargo, any REO Disposition Fees related to such Mortgage Loan; second, to reimburse such Servicer
for any unreimbursed Advances; third, to reimburse the related Collection Account for any Nonrecoverable
Advances (or portions thereof) that were previously withdrawn by such Servicer pursuant to
Section 3.08(a)(iii) that related to such Non-Designated Mortgage Loan; fourth, to accrued and unpaid
interest (to the extent no Advance has been made for such amount or any such Advance has been
reimbursed) on the Non-Designated Mortgage Loan or related REO Property, at the per annum rate equal to
the related Mortgage Rate reduced by the related Servicing Fee Rate, and any primary mortgage guaranty
insurance fee rate, if applicable, 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 and/or with respect to recoveries
obtained following the liquidation of a Liquidated Mortgage Loan ("Excess Proceeds") that is a
Non-Designated Mortgage Loan shall be retained by the related Servicer as additional servicing
compensation pursuant to Section 3.14.
(f) With respect to any Mortgage Loan related to the Group 1, Group 2 or Group 3 Certificates, a
Servicer of such Mortgage Loan may (but is not obligated to) enter into a special servicing agreement
with an unaffiliated Holder of a 100% Percentage Interest of the most junior outstanding Class C-B
Certificates. Any such agreement may contain provisions whereby such Holder may (i) instruct the
related Servicer to commence or delay foreclosure proceedings with respect to any such Mortgage Loan
that is delinquent and will contain provisions for the deposit of cash with such Servicer by such Holder
that would be available for distribution to Certificateholders if Liquidation Proceeds are less than
they otherwise may have been had such Servicer acted in accordance with its normal procedures,
(ii) purchase any such Mortgage Loan that is delinquent from the Trust Fund immediately prior to the
commencement of foreclosure proceedings at a price equal to the Purchase Price, and/or (iii) assume all
of the servicing rights and obligations (as a Sub-Servicer on behalf of the related Servicer) with
respect to any such Mortgage Loan that is delinquent so long as (A) such Holder meets the requirements
for a Sub-Servicer set forth in Section 3.02(a), (B) such Holder has a current special servicing ranking
of at least "Average" from S&P, (C) such Holder shall subservice such Mortgage Loan in accordance with
this Agreement, and (D) the related Servicer has the right to transfer such servicing rights without the
payment of any compensation to a Sub-Servicer.
With respect to any Mortgage Loan related to the Group 4 Certificates, a Servicer of
such Mortgage Loan may (but is not obligated to) enter into a special servicing agreement with an
unaffiliated Holder of a 100% Percentage Interest of the Class 4-X Certificates. Any such agreement may
contain provisions whereby such Holder may (i) instruct the related Servicer to commence or delay
foreclosure proceedings with respect to any such Mortgage Loan that is delinquent and will contain
provisions for the deposit of cash with such Servicer by such Holder that would be available for
distribution to Certificateholders if Liquidation Proceeds are less than they otherwise may have been
had such Servicer acted in accordance with its normal procedures, (ii) purchase any such Mortgage Loan
that is delinquent from the Trust Fund immediately prior to the commencement of foreclosure proceedings
at a price equal to the Purchase Price, and/or (iii) assume all of the servicing rights and obligations
(as a Sub-Servicer on behalf of the related Servicer) with respect to any such Mortgage Loan that is
delinquent so long as (A) such Holder meets the requirements for a Sub-Servicer set forth in
Section 3.02(a), (B) such Holder has a current special servicing ranking of at least "Average" from S&P,
(C) such Holder shall subservice such Mortgage Loan in accordance with this Agreement, and (D) the
related Servicer has the right to transfer such servicing rights without the payment of any compensation
to a Sub-Servicer.
(g) The Special Servicer, at its option, may (but is not obligated to) purchase from the Trust
Fund, (a) any Mortgage Loan that is delinquent in payment 90 or more days or (b) any related Mortgage
Loan with respect to which there has been initiated legal action or other proceedings for the
foreclosure of the related Mortgaged Property either judicially or non-judicially, in each case,
provided that the applicable Servicer has the right to transfer the related servicing rights without the
payment of any compensation to a Sub-Servicer. In the event that the Special Servicer exercises such
option, the Purchase Price therefor shall be deposited in the related Collection Account and upon such
deposit of the Purchase Price and receipt of a Request for Release in the form of Exhibit K hereto, the
Custodian shall release the related Mortgage File held for the benefit of the Certificateholders to the
Special Servicer, and the Trustee shall execute and deliver at the Special Servicer's direction such
instruments of transfer or assignment prepared by the Special Servicer, in each case without recourse,
as shall be necessary to transfer title from the Trustee to the Special Servicer. The applicable
Servicer shall be entitled to reimbursement from the Special Servicer for all expenses incurred by it in
connection with the transfer of any Mortgage Loan to the Special Servicer pursuant to this
Section 3.11(g).
SECTION 3.12. Trustee and Trust Administrator to Cooperate; Release of Mortgage Files.
Upon the payment in full of any Non-Designated Mortgage Loan, or the receipt by a
Servicer of a notification that payment in full will be escrowed in a manner customary for such
purposes, such Servicer shall immediately notify the related Custodian by delivering, or causing to be
delivered a "Request for Release" substantially in the form of Exhibit K. Upon receipt of such request,
such Custodian shall within three Business Days release the related Mortgage File to the related
Servicer, and the Trustee shall within three Business Days of such Servicer's direction execute and
deliver to such Servicer the deed of reconveyance or release or satisfaction of mortgage or such
instrument releasing the lien of the Mortgage in each case provided by such Servicer, and such Custodian
shall deliver the Mortgage Note with written evidence of cancellation thereon. 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 Non-Designated 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 related
Custodian within three Business Days of delivery to such Custodian of a Request for Release in the form
of Exhibit K signed by a Servicing Officer, release the Mortgage File to the related Servicer. Subject
to the further limitations set forth below, the related Servicer shall cause the Mortgage File or
documents so released to be returned to the related Custodian on its behalf, when the need therefor by
such Servicer no longer exists, unless the Non-Designated Mortgage Loan is liquidated and the proceeds
thereof are deposited in the related Collection Account, in which case such Servicer shall deliver to
the Trustee, or the related Custodian a Request for Release in the form of Exhibit K, signed by a
Servicing Officer. Each Servicer is also 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, including an assignment of such loan to the Trustee.
If a Servicer at any time seeks to initiate a foreclosure proceeding in respect of any
Mortgaged Property related to a Non-Designated Mortgage Loan as authorized by this Agreement, such
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 a Servicer to be Held for the Trust.
Notwithstanding any other provisions of this Agreement, each Servicer shall transmit
to the related Custodian, as required by this Agreement all documents and instruments in respect of a
Non-Designated Mortgage Loan coming into the possession of the related Servicer from time to time
required to be delivered to the Trustee, or such Custodian on its behalf, pursuant to the terms hereof
and shall account fully to the Trust Administrator for any funds received by such Servicer or which
otherwise are collected by such Servicer as Liquidation Proceeds or Insurance Proceeds in respect of any
Non-Designated Mortgage Loan. All Mortgage Files and funds collected or held by, or under the control
of, a Servicer in respect of any Non-Designated Mortgage Loans, whether from the collection of principal
and interest payments or from Liquidation Proceeds, including but not limited to, any funds on deposit
in a Collection Account, shall be held by the related Servicer for and on behalf of the Trust, the
Trustee or the Trust Administrator and shall be and remain the sole and exclusive property of the Trust,
subject to the applicable provisions of this Agreement. Each Servicer also agrees that it shall not
create, incur or subject any Mortgage File or any funds that are deposited in the related Collection
Account, Certificate Account or any related Escrow Account, or any funds that otherwise are or may
become due or payable to the Trust, the Trustee or the Trust Administrator 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 Non-Designated Mortgage Loan, except, however,
that such Servicer shall be entitled to set off against and deduct from any such funds any amounts that
are properly due and payable to such Servicer under this Agreement.
SECTION 3.14. Servicing Fee; Indemnification of Master Servicer.
(a) As compensation for its services hereunder, each Servicer shall be entitled to withdraw from
the applicable Collection Account or to retain from interest payments on the related Non-Designated
Mortgage Loans, the amount of its Servicing Fee, for each Mortgage Loan serviced by it, less any amounts
in respect of its Servicing Fee, as applicable, payable by such Servicer pursuant to
Section 3.05(c)(vi). The Servicing Fee for each Servicer is limited to, and payable solely from, the
interest portion of such Scheduled Payments collected by such Servicer or as otherwise provided in
Section 3.08(a). In connection with the servicing of any Special Serviced Mortgage Loan, the Special
Servicer shall receive the Servicing Fee for such Special Serviced Mortgage Loan as its compensation and
Ancillary Income with respect to Special Serviced Mortgage Loans.
(b) With respect to each Non-Designated Mortgage Loan, additional servicing compensation in the
form of Ancillary Income and Excess Proceeds shall be retained by the related Servicer, additional
servicing compensation in the form of Payoff Interest not required to make payments in respect of
Compensating Interest Payments shall be retained by SPS. Each Servicer shall be required to pay all
expenses incurred by it in connection with its servicing activities hereunder (including the payment of
any expenses incurred in connection with any Subservicing Agreement entered into pursuant to
Section 3.02 and the payment of any premiums for insurance required pursuant to Section 3.16) and shall
not be entitled to reimbursement thereof except as specifically provided for in this Agreement.
(c) The Master Servicer shall be compensated by the Trust Administrator as separately agreed. The
Master Xxxxxxxx and any director, officer, employee or agent of the Master Servicer shall be indemnified
by DLJMC (or if DLJMC shall fail to do so, by the Trust) and held harmless against any loss, liability
or expense (including reasonable attorney's fees and expenses) incurred in connection with any claim or
legal action relating to (a) this Agreement, (b) the Certificates or (c) the performance of any of the
Master Servicer'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 Master Servicer's duties
hereunder or incurred by reason of any action of the Master Servicer taken at the direction of the
Certificateholders; provided, however, that the sum of (x) such indemnity amounts payable by DLJMC or
the Trust to the Master Servicer pursuant to this Section 3.14(c), (y) the indemnity amounts payable by
DLJMC or the Trust to the Trust Administrator pursuant to Section 10.05 and (z) the indemnity amounts
payable by DLJMC or the Trust to Xxxxx Fargo, as Custodian, pursuant to the Xxxxx Fargo Custodial
Agreement, shall not exceed $200,000 per year; provided, further, that any amounts not payable by DLJMC
or the Trust to the Master Servicer due to the preceding proviso shall be payable by DLJMC (or if DLJMC
fails to do so, by the Trust) in any succeeding year, subject to the aggregate $200,000 per annum
limitation imposed by the preceding proviso. Such indemnity shall survive the termination of this
Agreement or the resignation or removal of the Master Servicer hereunder.
SECTION 3.15. Access to Certain Documentation.
The Master Servicer and each Servicer shall provide to the Depositor and the Trustee,
at the request of the OTS and the FDIC and to comparable regulatory authorities supervising Holders of
Subordinate Certificates and the examiners and supervisory agents of the OTS, the FDIC and such other
authorities, access to the documentation regarding the related Non-Designated 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 or such Servicer. Nothing in this Section 3.15 shall limit the obligation of the
Master Servicer or any Servicer to observe any applicable law prohibiting disclosure of information
regarding the Mortgagors and the failure of the Master Servicer or such Servicer to provide access as
provided in this Section 3.15 as a result of such obligation shall not constitute a breach of this
Section 3.15. Nothing in this Section 3.15 shall require the Master Servicer or any Servicer to
collect, create, collate or otherwise generate any information that it does not generate in its usual
course of business.
SECTION 3.16. Maintenance of Fidelity Bond and Errors and Omissions Insurance.
Each Servicer shall maintain with responsible companies, at its own expense, a blanket
Fidelity Bond and an Errors and Omissions Insurance Policy, with broad coverage on all officers,
employees or other persons acting in any capacity requiring such persons to handle funds, money,
documents or papers relating to the related Mortgage Loans ("Servicer Employees"). Any such Fidelity
Bond and Errors and Omissions Insurance Policy shall be in the form of the Mortgage Banker's Blanket
Bond and shall protect and insure the related Servicer against losses, including forgery, theft,
embezzlement, fraud, errors and omissions and negligent acts of such Servicer Employees. Such Fidelity
Bond and Errors and Omissions Insurance Policy also shall protect and insure each Servicer against
losses in connection with the release or satisfaction of a related Mortgage Loan without having obtained
payment in full of the indebtedness secured thereby. No provision of this Section 3.16 requiring such
Fidelity Bond and Errors and Omissions Insurance Policy shall diminish or relieve a Servicer from its
duties and obligations as set forth in this Agreement. The minimum coverage under any such bond and
insurance policy shall be at least equal to the corresponding amounts required by FNMA, unless the
related Servicer has obtained a waiver of such requirement. Upon the request of the Trust Administrator,
the related Servicer shall cause to be delivered to the Trust Administrator a certificate of insurance
of the insurer and the surety including a statement from the surety and the insurer that such fidelity
bond and insurance policy shall in no event be terminated or materially modified without 30 days' prior
written notice to the Trust Administrator.
The Master Servicer shall maintain insurance in such amounts generally acceptable for
entities serving as master servicer.
SECTION 3.17. Special Serviced Mortgage Loans.
If directed by the Special Servicer and solely at the Special Servicer's option, a
Servicer (a "Transferring Servicer") shall transfer the servicing of any Mortgage Loan serviced by the
Transferring Servicer which is 90 days or more delinquent (determined as of the close of business of the
last day of the month preceding the related Data Remittance Date) to the Special Servicer. The Special
Servicer shall thereupon assume all of the rights and obligations of the Transferring Servicer hereunder
arising thereafter and the Transferring Servicer shall have no further rights or obligations hereunder
with respect to such Mortgage Loan (except that the Special Servicer shall not be (i) liable for losses
of the Transferring Servicer pursuant to Section 3.09 hereof or for any acts or omissions of the
Transferring Servicer hereunder prior to the servicing transfer date, (ii) 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, (iii) deemed to have made any
representations and warranties of a Transferring Servicer hereunder or (iv) be subject to any other
agreement not executed by the Special Servicer). Upon the transfer of the servicing of any such
Mortgage Loan to the Special Servicer, the Special Servicer shall be entitled to the related Servicing
Fee and other compensation accruing after the servicing transfer date with respect to such Mortgage
Loans pursuant to Section 3.14.
In connection with the transfer of the servicing of any Mortgage Loan to the Special
Servicer, the Transferring Servicer, at the Special Servicer's expense, shall deliver to the Special
Servicer all documents and records relating to such Mortgage Loans 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 servicing to the Special Servicer. On the servicing transfer date, the Special Servicer shall
reimburse the Transferring Servicer for all unreimbursed Advances, Servicing Advances and Servicing
Fees, as applicable, relating to the Mortgage Loans for which the servicing is being transferred. The
Special Servicer shall be entitled to be reimbursed pursuant to Section 3.08 or otherwise pursuant to
this Agreement for all such Advances, Servicing Advances and Servicing Fees, as applicable, paid by the
Transferring Servicer pursuant to this Section 3.17. In addition, the Special Servicer shall notify the
Master Servicer of such transfer and the effective date of such transfer, and amend the Mortgage Loan
Schedule to reflect that such Mortgage Loans are Special Serviced Mortgage Loans.
SECTION 3.18. Indemnification of Servicers and Master Servicer.
Each Servicer agrees to indemnify and hold the Master Servicer harmless from and
against any and all losses, claims, expenses, costs or liabilities (including attorneys fees and court
costs) incurred by the Master Servicer as a result of or in connection with the failure by such Servicer
to perform the obligations or responsibilities imposed upon or undertaken by such Servicer under this
Agreement.
The Master Servicer agrees to indemnify and hold each Servicer harmless from and
against any and all losses, claims, expenses, costs or liabilities (including attorneys fees and court
costs) incurred by such Servicer as a result of or in connection with the failure by the Master Servicer
to perform the obligations or responsibilities imposed upon or undertaken by the Master Servicer under
this Agreement.
SECTION 3.19. Notification of Adjustments.
With respect to each Mortgage Loan, the related Servicer shall adjust the Mortgage
Rate on the related Adjustment Date in compliance with the requirements of applicable law and the
related Mortgage and Mortgage Note. The related Servicer shall execute and deliver any and all
necessary notices required under applicable law and the terms of the related Mortgage Note and Mortgage
regarding the Mortgage Rate adjustments. Upon the discovery by the related Servicer or the receipt of
notice from the Trust Administrator that such Servicer has failed to adjust a Mortgage Rate in
accordance with the terms of the related Mortgage Note, such Servicer shall immediately deposit in the
Certificate Account from its own funds the amount of any interest loss or deferral caused the Trust
Administrator thereby.
SECTION 3.20. Designated Mortgage Loans.
(a) For and on behalf of the Certificateholders, the Master Servicer shall oversee and enforce the
obligation of each Designated Servicer to service and administer the related Designated Mortgage Loans
in accordance with the terms of the related Designated Servicing Agreement and shall have full power and
authority to do any and all things which it may deem necessary or desirable in connection with such
master servicing and administration. In performing its obligations hereunder, the Master Servicer shall
act in a manner consistent with this Agreement and with customary and usual standards of practice of
prudent mortgage loan master servicers. Furthermore, the Master Servicer shall oversee and consult with
each Designated Servicer as necessary from time-to-time to carry out the Master Servicer's obligations
hereunder, and shall receive, review and evaluate all reports, information and other data provided to
the Master Servicer by each Designated Servicer.
The Master Servicer shall terminate the rights and obligations of any Designated
Servicer under the related Designated Servicing Agreement, upon the failure of such Designated Servicer
to perform any of its obligations under such Designated Servicing Agreement, which failure results in an
event of default as provided in Section 14 of the Countrywide Underlying Servicing Agreement with
respect to Countrywide, as provided in Section 8.01 of the Hemisphere Underlying Servicing Agreement
with respect to Hemisphere, as provided in Section 12.07 and Section W of Exhibit M to the CitiMortgage
Underlying Servicing Agreement with respect to CitiMortgage, and as provided in Subsection 12.01 of the
BofA Underlying Servicing Agreement with respect to BofA. In the event a Designated Servicer is
terminated pursuant to the preceding sentence, the Master Servicer shall notify the Depositor and the
Trust Administrator and shall either (a) select and engage a successor servicer of the related Mortgage
Loans or (b) act as successor servicer of the related Mortgage Loans. In either case, the Designated
Mortgage Loans related to such Designated Servicing Agreement shall be serviced by the successor to such
Designated Servicer pursuant to the servicing provisions of this Agreement, and such Designated Mortgage
Loans shall be deemed as "Non-Designated Mortgage Loans" under this Agreement; provided, however, it is
understood and acknowledged by the parties hereto that there will be a period of transition (not to
exceed 90 days) before the actual servicing functions can be fully transferred to such successor
Designated Servicer. Such enforcement, including, without limitation, the legal prosecution of claims,
termination of Designated Servicing Agreements and the pursuit of other appropriate remedies, shall be
in such form and carried out to such an extent and at such time as the Master Servicer, in its good
faith business judgment, would require were it the owner of the related Mortgage Loans. The Master
Servicer shall pay the costs of such enforcement at its own expense, provided that the Master Servicer
shall not be required to prosecute or defend any legal action except to the extent that the Master
Servicer shall have received reasonable indemnity for its costs and expenses in pursuing such action.
To the extent that the costs and expenses of the Master Servicer related to any
termination of a Designated Servicer, appointment of a successor Designated Servicer or the transfer and
assumption of servicing by the Master Servicer with respect to any Designated Servicing Agreement
(including, without limitation, (i) all legal costs and expenses and all due diligence costs and
expenses associated with an evaluation of the potential termination of a Designated Servicer as a result
of an event of default by such Designated Servicer and (ii) all costs and expenses associated with the
complete transfer of servicing, including all servicing files and all servicing data and the completion,
correction or manipulation of such servicing data as may be required by the successor servicer to
correct any errors or insufficiencies in the servicing data or otherwise to enable the successor
servicer to service the Mortgage Loans in accordance with this Agreement) are not fully reimbursed by
the terminated Designated Servicer, the Master Servicer shall be entitled to reimbursement of such costs
and expenses from the Trust.
(b) Each month, if a Designated Servicer fails to make a required Advance by the date such Advance
is required to be made under the related Designated Servicing Agreement, the Master Servicer shall on
the Cash Remittance Date deposit in the amount of any required Advance in the Certificate Account.
(c) Each month, the Master Servicer shall make Compensating Interest Payments with respect to the
Designated Mortgage Loans to the extent provided in Section 3.03.
SECTION 3.21. Assigned Prepayment Premiums.
Notwithstanding anything in this Agreement to the contrary, in the event of a
Principal Prepayment, the applicable Servicer may not waive any Assigned Prepayment Premium or portion
thereof required by the terms of the related Mortgage Note unless (i) the related Mortgage Loan is in
default or foreseeable default and such waiver (a) is standard and customary in servicing mortgage loans
similar to the Mortgage Loans and (b) would, in the reasonable judgment of such Servicer, maximize
recovery of total proceeds taking into account the value of such Assigned Prepayment Premium and the
related Mortgage Loan, (ii) (A) the enforceability thereof is limited (1) by bankruptcy, insolvency,
moratorium, receivership, or other similar law relating to creditors' rights generally or (2) due to
acceleration in connection with a foreclosure or other involuntary payment, or (B) the enforceability is
otherwise limited or prohibited by applicable law, (iii) the enforceability would be considered
"predatory" pursuant to written guidelines issued by any applicable federal, state or local authority
having jurisdiction over such matters, (iv) such Servicer is unable to locate documentation sufficient
to allow it to confirm the existence and amount of such Assigned Prepayment Premium after using
commercially reasonable efforts to locate such documentation, which efforts shall include, but are not
limited to, seeking such documentation from the Depositor, the Seller, the related Custodian and from
its own records or files or (v) the related Mortgaged Property has been damaged such that the current
value of the Mortgaged Property has been reduced by at least half as a result of a natural disaster or
other insured or uninsured peril, and the borrower has elected to pay the loan in full rather than
rebuild the Mortgaged Property. For the avoidance of doubt, the applicable Servicer may waive an
Assigned Prepayment Premium in connection with a short sale or short payoff on a defaulted Mortgage
Loan. If an applicable Servicer has waived all or a portion of an Assigned Prepayment Premium relating
to a Principal Prepayment, other than as provided above, such Servicer shall deliver to the Trust
Administrator no later than the next succeeding Cash Remittance Date, for deposit into the Certificate
Account the amount of such Assigned Prepayment Premium (or such portion thereof as had been waived) for
distribution in accordance with the terms of this Agreement and if such Servicer fails to deliver such
amount, any of the Trust Administrator, the Master Servicer, the Trustee or the Seller may enforce such
obligation. If such Servicer has waived all or a portion of an Assigned Prepayment Premium for any
reason, it shall include such information, including the reason for such waiver, in any monthly reports
it provides, and such Servicer if other than Xxxxx Fargo, shall notify the Trust Administrator, the
Seller, the Master Servicer and the Trustee of such waiver, and if such Servicer is Xxxxx Fargo, Xxxxx
Fargo shall notify the Trust Administrator and the Trust Administrator shall forward any such notice to
the Seller, the Master Servicer and the Trustee. Notwithstanding any provision in this Agreement to the
contrary, in the event the Assigned Prepayment Premium payable under the terms of the related Mortgage
Note is less than the amount of the Assigned Prepayment Premium set forth in the Mortgage Loan
Schedule or other information provided to the applicable Servicer, such Servicer shall not have any
liability or obligation with respect to such difference. The Master Servicer shall not have any
responsibility for verifying the accuracy of the amount of Assigned Prepayment Premiums remitted by the
Servicers.
Notwithstanding anything in this Agreement to the contrary, the Trustee and the Trust
Administrator shall have no obligation to collect Prepayment Premiums from any Servicer or Designated
Servicer other than Xxxxx Fargo, in its capacity as a Servicer (or any of its successors and assigns),
GreenPoint (or any of its successors and assigns) or SPS (or any of its successors and assigns).
ARTICLE IV
PAYMENTS AND STATEMENTS TO CERTIFICATEHOLDERS
SECTION 4.01. Priorities of Distribution.
(I) (A) On each Distribution Date, with respect to the Group 1, Group 2,
Group 3 and Class C-B Certificates, the Trust Administrator shall determine the amounts to be distributed
to each Class of Certificates as follows:
(a) with respect to the Group 1 Certificates, from the Available Distribution Amount relating to
Loan Group 1:
(i) first, concurrently, to the Group 1 Certificates and the Class C-M-1 Certificates, an amount
allocable to interest equal to the related Interest Distribution Amount for such
Distribution Date, any shortfall being allocated pro rata between such Classes based
on the Interest Distribution Amount that would have been distributed in the absence of
such shortfall; and
(ii) second, on each Distribution Date, from the Available Distribution Amount for Loan Group 1
remaining after giving effect to the distributions pursuant to
Section 4.01(I)(A)(a)(i) above, the Group 1 Senior Principal Distribution Amount, as
principal, sequentially, as follows:
(A) first, to the Class AR and Class AR-L Certificates, pro rata based on their respective Class
Principal Balances immediately prior to such Distribution Date, until their
respective Class Principal Balances have been reduced to zero; and
(B) second, the Group 1 Senior Principal Distribution Amount for that Distribution Date remaining
after making the payments specified in clause (A) above, to the Class 1-A-1
and Class C-M-1 Certificates, pro rata based on its Class Principal Balance
with respect to the Class 1-A-1 Certificates and the Class C-M-1 Group 1
Component Balance with respect to the Class C-M-1 Certificates, in each case
immediately prior to such Distribution Date, until their respective Class
Principal Balances have been reduced to zero;
(b) with respect to the Group 2 Certificates, and from the Available Distribution Amount relating
to Loan Group 2:
(i) first, concurrently, to the Group 2 Certificates, an amount allocable to interest equal to the
related Interest Distribution Amount for such Distribution Date, any shortfall being
allocated pro rata between such Classes based on the Interest Distribution Amount that
would have been distributed in the absence of such shortfall; and
(ii) second, on each Distribution Date, from the Available Distribution Amount for Loan Group 2
remaining after giving effect to the distributions pursuant to
Section 4.01(I)(A)(b)(i) above, to the Class 2-A-1 and Class 2-A-2 Certificates, as
principal, the Group 2 Senior Principal Distribution Amount, pro rata based on their
respective Class Principal Balances immediately prior to such Distribution Date, until
their respective Class Principal Balances have been reduced to zero.
(c) with respect to the Group 3 Certificates, and from the Available Distribution Amount relating
to Loan Group 3:
(i) first, concurrently, to the Group 3 Certificates and the Class C-M-1 Certificates, an amount
allocable to interest equal to the related Interest Distribution Amount for such
Distribution Date, any shortfall being allocated pro rata between such Classes based
on the Interest Distribution Amount that would have been distributed in the absence of
such shortfall; and
(ii) second, on each Distribution Date, from the Available Distribution Amount for Loan Group 3
remaining after giving effect to the distributions pursuant to
Section 4.01(I)(A)(c)(i) above, to the Class 3-A-1 and Class C-M-1 Certificates, pro
rata based on its Class Principal Balance with respect to the Class 3-A-1 Certificates
and the Class C-M-1 Group 3 Component Balance with respect to the Class C-M-1
Certificates, in each case immediately prior to such Distribution Date, until their
respective Class Principal Balances have been reduced to zero.
(d) with respect to the Class C-B and Class AR-L Certificates, from the Available Distribution
Amount relating to Loan Group 1, Loan Group 2 and Loan Group 3 remaining after the
distributions pursuant to Sections 4.01(I)(A)(a) through (c) above, subject to Sections
4.01(I)(C) below, and further subject to any payments to the Group 1, Group 2 and Group 3
Certificates as described in Section 4.07, to the following Classes in the following order of
priority:
(i) to the Class C-B-1 Certificates, an amount allocable to interest equal to the Interest
Distribution Amount for such Class for such Distribution Date;
(ii) to the Class C-B-1 Certificates, an amount allocable to principal equal to its Pro Rata Share
for such Distribution Date, until the Class Principal Balance of Class C-B-1
Certificates has been reduced to zero;
(iii) to the Class C-B-2 Certificates, an amount allocable to interest equal to the Interest
Distribution Amount for such Class for such Distribution Date;
(iv) to the Class C-B-2 Certificates, an amount allocable to principal equal to its Pro Rata Share
for such Distribution Date, until the Class Principal Balance of Class C-B-2
Certificates has been reduced to zero;
(v) to the Class C-B-3 Certificates, an amount allocable to interest equal to the Interest
Distribution Amount for such Class for such Distribution Date;
(vi) to the Class C-B-3 Certificates, an amount allocable to principal equal to its Pro Rata Share
for such Distribution Date, until the Class Principal Balance of Class C-B-3
Certificates has been reduced to zero;
(vii) to the Class C-B-4 Certificates, an amount allocable to interest equal to the Interest
Distribution Amount for such Class for such Distribution Date;
(viii) to the Class C-B-4 Certificates, an amount allocable to principal equal to its Pro Rata Share
for such Distribution Date, until the Class Principal Balance of Class C-B-4
Certificates has been reduced to zero;
(ix) to the Class C-B-5 Certificates, an amount allocable to interest equal to the Interest
Distribution Amount for such Class for such Distribution Date;
(x) to the Class C-B-5 Certificates, an amount allocable to principal equal to its Pro Rata Share
for such Distribution Date, until the Class Principal Balance of Class C-B-5
Certificates has been reduced to zero;
(xi) to the Class C-B-6 Certificates, an amount allocable to interest equal to the Interest
Distribution Amount for such Class for such Distribution Date;
(xii) to the Class C-B-6 Certificates, an amount allocable to principal equal to its Pro Rata Share
for such Distribution Date, until the Class Principal Balance of Class C-B-6
Certificates has been reduced to zero;
(xiii) to the Class C-B-1, Class C-B-2, Class C-B-3, Class C-B-4, Class C-B-5 and Class C-B-6
Certificates, in that order, up to an amount of Net Realized Losses for such Class, if
any; provided, however, that any distribution pursuant to this
Section 4.01(I)(A)(d)(xiii) shall not result in a further reduction of the Class
Principal Balance of any of the Class C-B Certificates; and
(xiv) to the Class AR-L Certificates, any remaining Available Distribution Amount for Loan Group 1,
Loan Group 2 and Loan Group 3, (to the extent such amount is held by REMIC I), or to
the Class AR Certificates, any remaining Available Distribution Amount for Loan
Group 1, Loan Group 2 and Loan Group 3 (to the extent such amount is held by REMIC III).
(B) On each Distribution Date, the amount referred to in clause (i) of the
definition of Interest Distribution Amount for such Distribution Date for each Class of Group 1,
Group 2, Group 3, Class C-M-1 and Class C-B Certificates shall be reduced by the Trust Administrator by
the related Class's pro rata share (based on the amount of the Interest Distribution Amount for each
such Class before reduction pursuant to this Section 4.01(I)(B)) of (i) Net Prepayment Interest
Shortfalls for Mortgage Loans in the related Loan Group for such Distribution Date and (ii) (A) after
the Special Hazard Coverage Termination Date, with respect to each Group 1, Group 2 and Group 3 Mortgage
Loan, as applicable, that was the subject of Special Hazard Loss during the prior calendar month, the
excess of one month's interest at the related Net Mortgage Rate on the Stated Principal Balance of such
Mortgage Loan as of the Due Date in such month over the amount of Liquidation Proceeds applied as
interest on such Mortgage Loan with respect to such month, (B) after the Bankruptcy Coverage Termination
Date, with respect to each Group 1, Group 2 or Group 3 Mortgage Loan, as applicable, that became subject
to a Bankruptcy Loss during the prior calendar month, the interest portion of the related Debt Service
Reduction or Deficient Valuation, (C) each Relief Act Reduction for any Group 1, Group 2 or Group 3
Mortgage Loan, as applicable, incurred during the prior calendar month and (D) after the Fraud Loss
Coverage Termination Date, with respect to each Group 1, Group 2 or Group 3 Mortgage Loan, as
applicable, that became a Fraud Loan during the prior calendar month the excess of one month's interest
at the related Net Mortgage Rate on the Stated Principal Balance of such Mortgage Loan as of the Due
Date in such month over the amount of Liquidation Proceeds applied as interest on such Mortgage Loan
with respect to such month. For purposes of calculating the reduction of the Interest Distribution
Amount for the Class C-M-1 Certificates with respect to Loan Group 1 or Loan Group 3, such reduction
shall be based on the amount of interest accruing at the Net WAC Rate for such Loan Group on the
Class C-M-1 Group 1 Component Balance and Class C-M-1 Group 3 Component Balance, respectively, in each
case for such Distribution Date. For purposes of calculating the reduction of the Interest Distribution
Amount for each Class of Class C-B Certificates with respect to Loan Group 1, Loan Group 2 or Loan
Group 3, such reduction shall be based on the amount of interest accruing at the Net WAC Rate for such
Loan Group on such Class's proportionate share, based on the Class Principal Balance of the related
Subordinate Component Balance for that Distribution Date.
(C) With respect to each Class of Class C-B Certificates, if on any Distribution
Date the related Subordination Level of such Class is less than such percentage as of the Closing Date,
no distribution of Principal Prepayments shall be made to any Class or Classes of Class C-B Certificates
junior to such Class (the "Restricted Classes") and the amount otherwise distributable to the Restricted
Classes in respect of such Principal Prepayments shall be allocated among the remaining Classes of
Class C-B Certificates, pro rata, based upon their respective Class Principal Balances.
(D) The Trust Administrator shall distribute the Mortgage Loan Purchase Price of
any Optional Termination of Loan Group 1, Loan Group 2 and Loan Group 3 in excess of the Par Value to
the holder of the Class AR-L Certificate.
(II) With respect to the Group 4 Certificates:
(a) On each Distribution Date or, in the case of payments to the Supplemental Interest Trust, on
the related Swap Payment Date, the Trust Administrator shall distribute the Interest Remittance
Amount for such date in the following order of priority:
(i) to the Supplemental Interest Trust for payment to the Swap Counterparty, an amount equal to the
Swap Fee Amount and any Swap Termination Payment not due to a Swap Counterparty
Trigger Event for such Distribution Date and any Swap Termination Payment not due to a
Swap Counterparty Trigger Event remaining unpaid from a prior Swap Payment Date;
(ii) to the Group 4 Senior Certificates, pro rata based on amounts due, Current Interest and any
Carryforward Interest for such Class and such Distribution Date;
(iii) to the Class 4-M-1 Certificates, Current Interest and any Carryforward Interest for such
Class and such Distribution Date;
(iv) to the Class 4-M-2 Certificates, Current Interest and any Carryforward Interest for such
Class and such Distribution Date;
(v) to the Class 4-M-3 Certificates, Current Interest and any Carryforward Interest for such
Class and such Distribution Date;
(vi) to the Class 4-M-4 Certificates, Current Interest and any Carryforward Interest for such
Class and such Distribution Date;
(vii) to the Class 4-M-5 Certificates, Current Interest and any Carryforward Interest for such
Class and such Distribution Date;
(viii) to the Class 4-M-6 Certificates, Current Interest and any Carryforward Interest for such
Class and such Distribution Date;
(ix) to the Class 4-M-7 Certificates, Current Interest and any Carryforward Interest for such
Class and such Distribution Date;
(x) to the Class 4-M-8 Certificates, Current Interest and any Carryforward Interest for such
Class and such Distribution Date;
(xi) to the Class 4-M-9 Certificates, Current Interest and any Carryforward Interest for such
Class and such Distribution Date;
(xii) to the Class 4-B-1 Certificates, Current Interest and any Carryforward Interest for such
Class and such Distribution Date; and
(xiii) for application as part of Monthly Excess Cashflow for such Distribution Date as provided in
Section 4.01(II)(d), any Interest Remittance Amount remaining for such Distribution
Date.
(b) On each Distribution Date or, in the case of payments to the Supplemental Interest Trust, on
the related Swap Payment Date, (A) prior to the Stepdown Date or (B) with respect to which a
Trigger Event is in effect, the Trust Administrator shall distribute the Principal Payment
Amount for Loan Group 4 for such date in the following order of priority:
(i) to the Supplemental Interest Trust for payment to the Swap Counterparty, any Swap Termination
Payment not due to a Swap Counterparty Trigger Event for such Swap Payment Date or
remaining unpaid from any prior Swap Payment Date, to the extent remaining unpaid
after giving effect to the distributions of the Interest Remittance Amount set forth
in Section 4.01(II)(a) hereof for such Swap Payment Date;
(ii) to the Group 4 Senior Certificates, pro rata, weighted based on the aggregate Class Principal
Balance of four groups of classes (the Class 4-A-1-1 and Class 4-A-1-2 Certificates as
the first group, the Class 4-A-2 Certificates as the second group, the Class 4-A-3-1,
Class 4-A-3-2 and Class 4-A-3-3 Certificates as the third group and the Class 4-A-4
Certificates as the fourth group), as follows:
(1) the pro rata portion of the Principal Payment
Amount allocated to the Class 4-A-1-1 and Class 4-A-1-2 Certificates, to the
Class 4-A-1-1 and Class 4-A-1-2 Certificates, pro rata, weighted based on the
Class Principal Balance with respect the Class 4-A-1-1 Certificates and the
Class 4-A-1-2 Adjusted Class Principal Balance with respect to the
Class 4-A-1-2 Certificates, until their respective Class Principal Balances
have been reduced to zero;
(2) the pro rata portion of the Principal Payment
Amount allocated to the Class 4-A-2 Certificates, to the Class 4-A-2
Certificates, until its Class Principal Balance has been reduced to zero;
(3) the pro rata portion of the Principal Payment
Amount allocated to the Class 4-A-3-1, Class 4-A-3-2 and Class 4-A-3-3
Certificates, sequentially to the Class 4-A-3-1, Class 4-A-3-2 and
Class 4-A-3-3 Certificates, in that order, in each case until its
Class Principal Balance has been reduced to zero; and
(4) the pro rata portion of the Principal Payment
Amount allocated to the Class 4-A-4 Certificates, to the Class 4-A-4
Certificates, until its Class Principal Balance has been reduced to zero;
(iii) to the Class 4-M-1 Certificates, until its Class Principal Balance has been reduced to zero;
(iv) to the Class 4-M-2 Certificates, until its Class Principal Balance has been reduced to zero;
(v) to the Class 4-M-3 Certificates, until its Class Principal Balance has been reduced to zero;
(vi) to the Class 4-M-4 Certificates, until its Class Principal Balance has been reduced to zero;
(vii) to the Class 4-M-5 Certificates, until its Class Principal Balance has been reduced to zero;
(viii) to the Class 4-M-6 Certificates, until its Class Principal Balance has been reduced to zero;
(ix) to the Class 4-M-7 Certificates, until its Class Principal Balance has been reduced to zero;
(x) to the Class 4-M-8 Certificates, until its Class Principal Balance has been reduced to zero;
(xi) to the Class 4-M-9 Certificates, until its Class Principal Balance has been reduced to zero;
(xii) to the Class 4-B-1 Certificates, until its Class Principal Balance has been reduced to zero; and
(xiii) for application as part of Monthly Excess Cashflow for such Distribution Date, as provided in
Section 4.01(II)(d), any Principal Payment Amount remaining after application pursuant
to Section 4.01(II)(b)(i) through (xii) above.
(c) On each Distribution Date or, in the case of payments to the Supplemental Interest Trust, on
the related Swap Payment Date, (A) on or after the Stepdown Date and (B) with respect to which
a Trigger Event is not in effect, the Trust Administrator shall distribute the Principal
Payment Amount for Loan Group 4 for such date in the following order of priority:
(i) to the Supplemental Interest Trust for payment to the Swap Counterparty, any Swap Termination
Payment not due to a Swap Counterparty Trigger Event for such Swap Payment Date or
remaining unpaid from any prior Swap Payment Date, to the extent remaining unpaid
after giving effect to the distributions of the Interest Remittance Amount set forth
in Section 4.01(II)(a) hereof for the related Distribution Date;
(ii) to the Group 4 Senior Certificates, the sum of (1) the Group 4 Senior Principal Payment Amount
and (2) the component of the Principal Remittance Amount representing payments, if
any, under the Group 4 Interest Rate Cap Agreements to cover Realized Losses on the
Group 4 Mortgage Loans, in each case for such distribution date, pro rata, weighted
based on the aggregate Class Principal Balance of four groups of classes (the
Class 4-A-1-1 and Class 4-A-1-2 Certificates as the first group, the Class 4-A-2
Certificates as the second group, the Class 4-A-3-1, Class 4-A-3-2 and Class 4-A-3-3
Certificates as the third group and the Class 4-A-4 Certificates as the fourth group),
as follows:
(1) the pro rata portion of such amount allocated to
the Class 4-A-1-1 and Class 4-A-1-2 Certificates, to the Class 4-A-1-1 and
Class 4-A-1-2 Certificates, pro rata, weighted based on the Class Principal
Balance with respect the Class 4-A-1-1 Certificates and the Class 4-A-1-2
Adjusted Class Principal Balance with respect to the Class 4-A-1-2
Certificates, until their respective Class Principal Balances have been
reduced to zero;
(2) the pro rata portion of such amount allocated to
the Class 4-A-2 Certificates, to the Class 4-A-2 Certificates, until its
Class Principal Balance has been reduced to zero;
(3) the pro rata portion of such amount allocated to
the Class 4-A-3-1, Class 4-A-3-2 and Class 4-A-3-3 Certificates, sequentially
to the Class 4-A-3-1, Class 4-A-3-2 and Class 4-A-3-3 Certificates, in that
order, in each case until its Class Principal Balance has been reduced to
zero; and
(4) the pro rata portion of such amount allocated to
the Class 4-A-4 Certificates, to the Class 4-A-4 Certificates, until its
Class Principal Balance has been reduced to zero;
(iii) to the Class 4-M-1 Certificates, the Class 4-M-1 Principal Payment Amount for such Distribution
Date, until its Class Principal Balance has been reduced to zero;
(iv) to the Class 4-M-2 Certificates, the Class 4-M-2 Principal Payment Amount for such Distribution
Date, until the Class Principal Balance of such Class has been reduced to zero;
(v) to the Class 4-M-3 Certificates, the Class 4-M-3 Principal Payment Amount for such Distribution
Date, until the Class Principal Balance of such Class has been reduced to zero;
(vi) to the Class 4-M-4 Certificates, the Class 4-M-4 Principal Payment Amount for such Distribution
Date, until the Class Principal Balance of such Class has been reduced to zero;
(vii) to the Class 4-M-5 Certificates, the Class 4-M-5 Principal Payment Amount for such Distribution
Date, until the Class Principal Balance of such Class has been reduced to zero;
(viii) to the Class 4-M-6 Certificates, the Class 4-M-6 Principal Payment Amount for such Distribution
Date, until the Class Principal Balance of such Class has been reduced to zero;
(ix) to the Class 4-M-7 Certificates, the Class 4-M-7 Principal Payment Amount for such Distribution
Date, until the Class Principal Balance of such Class has been reduced to zero;
(x) to the Class 4-M-8 Certificates, the Class 4-M-8 Principal Payment Amount for such Distribution
Date, until the Class Principal Balance of such Class has been reduced to zero;
(xi) to the Class 4-M-9 Certificates, the Class 4-M-9 Principal Payment Amount for such Distribution
Date, until the Class Principal Balance of such Class has been reduced to zero;
(xii) to the Class 4-B-1 Certificates, the Class 4-B-1 Principal Payment Amount for such Distribution
Date, until the Class Principal Balance of such Class has been reduced to zero; and
(xiii) for application as part of Monthly Excess Cashflow for such Distribution Date, as provided in
Section 4.01(II)(d), any Principal Payment Amount remaining after application pursuant
to Section 4.01(II)(c)(i) through (xii) above.
(d) On each Distribution Date or, in the case of payments to the Supplemental Interest Trust, on
the related Swap Payment Date, the Trust Administrator shall distribute the Monthly Excess
Cashflow for such date in the following order of priority:
(i) until the aggregate Class Principal Balance of the Group 4 Certificates, other than the
Class 4-X Certificates, equals the Aggregate Loan Group Balance for Loan Group 4 for
such Distribution Date minus the Targeted Overcollateralization Amount for such date:
(A) on each Distribution Date (x) prior to the Stepdown Date or (y) with respect to which a Trigger
Event is in effect, to the extent of Monthly Excess Interest for such
Distribution Date, to the Group 4 Certificates, in the following order of
priority:
(1) to the Group 4 Senior Certificates, pro rata, weighted based on the aggregate Class Principal
Balance of four groups of classes (the Class 4-A-1-1 and Class 4-A-1-2
Certificates as the first group, the Class 4-A-2 Certificates as the
second group, the Class 4-A-3-1, Class 4-A-3-2 and Class 4-A-3-3
Certificates as the third group and the Class 4-A-4 Certificates as the
fourth group), as follows:
(A) the pro rata portion allocated to the
Class 4-A-1-1 and Class 4-A-1-2 Certificates, to the Class 4-A-1-1
and Class 4-A-1-2 Certificates, pro rata, weighted based on the Class
Principal Balance with respect the Class 4-A-1-1 Certificates and the
Class 4-A-1-2 Adjusted Class Principal Balance with respect to the
Class 4-A-1-2 Certificates, until their respective Class Principal
Balances have been reduced to zero;
(B) the pro rata portion allocated to the
Class 4-A-2 Certificates, to the Class 4-A-2 Certificates, until its
Class Principal Balance has been reduced to zero;
(C) the pro rata portion allocated to the
Class 4-A-3-1, Class 4-A-3-2 and Class 4-A-3-3 Certificates,
sequentially to the Class 4-A-3-1, Class 4-A-3-2 and Class 4-A-3-3
Certificates, in that order, in each case until its Class Principal
Balance has been reduced to zero; and
(D) the pro rata portion allocated to the
Class 4-A-4 Certificates, to the Class 4-A-4 Certificates, until its
Class Principal Balance has been reduced to zero;
(2) to the Class 4-M-1 Certificates, until its Class Principal Balance has been reduced to zero;
(3) to the Class 4-M-2 Certificates, until its Class Principal Balance has been reduced to zero;
(4) to the Class 4-M-3 Certificates, until its Class Principal Balance has been reduced to zero; and
(5) to the Class 4-M-4 Certificates, until its Class Principal Balance has been reduced to zero;
(6) to the Class 4-M-5 Certificates, until its Class Principal Balance has been reduced to zero;
(7) to the Class 4-M-6 Certificates, until its Class Principal Balance has been reduced to zero;
(8) to the Class 4-M-7 Certificates, until its Class Principal Balance has been reduced to zero;
(9) to the Class 4-M-8 Certificates, until its Class Principal Balance has been reduced to zero;
(10) to the Class 4-M-9 Certificates, until its Class Principal Balance has been reduced to zero; and
(11) to the Class 4-B-1 Certificates, until its Class Principal Balance has been reduced to zero; and
(B) on each Distribution Date (x) on or after the Stepdown Date and (y) with respect to which a
Trigger Event is not in effect, to fund any principal distributions required to
be made on such Distribution Date set forth above in Section 4.01(II)(c) above,
after giving effect to the distribution of the Principal Payment Amount for Loan
Group 4 for such Distribution Date, in accordance with the priorities set forth
therein;
(ii) to the Class 4-A-4 Certificates, any Deferred Amount for such Class;
(iii) to the Class 4-M-1 Certificates, any Deferred Amount for such Class;
(iv) to the Class 4-M-2 Certificates, any Deferred Amount for such Class;
(v) to the Class 4-M-3 Certificates, any Deferred Amount for such Class;
(vi) to the Class 4-M-4 Certificates, any Deferred Amount for such Class;
(vii) to the Class 4-M-5 Certificates, any Deferred Amount for such Class;
(viii) to the Class 4-M-6 Certificates, any Deferred Amount for such Class;
(ix) to the Class 4-M-7 Certificates, any Deferred Amount for such Class;
(x) to the Class 4-M-8 Certificates, any Deferred Amount for such Class;
(xi) to the Class 4-M-9 Certificates, any Deferred Amount for such Class;
(xii) to the Class 4-B-1 Certificates, any Deferred Amount for such Class;
(xiii) pro rata based on amounts due (a) pro rata based on amounts due, to the Class 4-A-1-1,
Class 4-A-1-2, Class 4-A-3-1, Class 4-A-3-2, Class 4-A-3-3 and Class 4-A-4
Certificates, any Basis Risk Shortfall for such class and (b) (i) to the Supplemental
Interest Trust, the Swap Counterparty Reimbursement Amount for such Distribution Date
or remaining unpaid from any prior Distribution Date and (ii) on any Distribution Date
on which a Swap Suspension Event has occurred and is continuing, to the Class 4-A-2
Certificates, any Basis Risk Shortfall for such class;
(xiv) to the Class 4-M-1 Certificates, any Basis Risk Shortfall due and owing for such Class;
(xv) to the Class 4-M-2 Certificates, any Basis Risk Shortfall due and owing for such Class;
(xvi) to the Class 4-M-3 Certificates, any Basis Risk Shortfall due and owing for such Class;
(xvii) to the Class 4-M-4 Certificates, any Basis Risk Shortfall due and owing for such Class;
(xviii) to the Class 4-M-5 Certificates, any Basis Risk Shortfall due and owing for such Class;
(xix) to the Class 4-M-6 Certificates, any Basis Risk Shortfall due and owing for such Class;
(xx) to the Class 4-M-7 Certificates, any Basis Risk Shortfall due and owing for such Class;
(xxi) to the Class 4-M-8 Certificates, any Basis Risk Shortfall due and owing for such Class;
(xxii) to the Class 4-M-9 Certificates, any Basis Risk Shortfall due and owing for such Class;
(xxiii) to the Class 4-B-1 Certificates, any Basis Risk Shortfall due and owing for such Class;
(xxiv) to the Supplemental Interest Trust for payment to the Swap Counterparty, any Swap Termination
Payment due to a Swap Counterparty Trigger Event for the related Swap Payment Date or
remaining unpaid from any prior Swap Payment Date;
(xxv) to the Class 4-X Certificates, the Class 4-X Distributable Amount for such Distribution Date;
and
(xxvi) to the Class AR Certificates, any remaining amount; provided, however, that any amount that
would be distributable pursuant to this priority (xxvi) shall not be paid with respect
to the Class AR Certificates but shall be paid instead with respect to the Class 4-X
Certificates pursuant to a contract that exists under this Agreement between the
Class AR Certificateholders and the Class 4-X Certificateholders.
(e) The Trust Administrator shall distribute the Mortgage Loan Purchase Price of any Optional
Termination of Loan Group 4 in excess of the Par Value to the holder of the Class AR-L
Certificate.
(III) (a) Prior to the distributions described in Sections 4.01(I) and (II),
the following distributions shall be deemed to have been made:
(i) from REMIC I to REMIC III, as the holder of the REMIC I
Regular Interests, and to Holders of the Class AR-L Certificates in respect of
Component I thereof, from the REMIC I Available Distribution Amount, the REMIC I
Distribution Amount in the amounts, from the sources and with the character set forth
in the definition thereof in respect of the REMIC I Regular Interests and Component I
of the Class AR-L Certificates as set forth therein; and
(ii) from REMIC II to REMIC III, as the holder of the REMIC II
Regular Interests, and to Holders of the Class AR-L Certificates in respect of
Component II thereof, from the REMIC II Available Distribution Amount, the REMIC II
Distribution Amount in the amounts, from the sources and with the character set forth
in the definition thereof in respect of the REMIC II Regular Interests and
Component II of the Class AR-L Certificates as set forth therein.
(b) Notwithstanding the distributions on the REMIC Regular Interests
described in this Section 4.01(III), distribution of funds from the Certificate Account shall
be made only in accordance with Sections 4.01(I) and (II).
(IV) On each Distribution Date, the Trust Administrator shall distribute to the
Holder of the Class P Certificates, the aggregate of all Assigned Prepayment Premiums for Mortgage Loans
collected or paid by each applicable Servicer with respect to the related Prepayment Period.
SECTION 4.02. Allocation of Losses.
(a) Realized Losses on the Mortgage Loans in each of Loan Group 1, Loan Group 2 and Loan Group 3
incurred during a calendar month shall be allocated by the Trust Administrator to the Classes of
Certificates on the Distribution Date in the next calendar month as follows:
(i) any Realized Loss, other than an Excess Loss, shall be allocated first, to the Class C-B
Certificates, in decreasing order of their alphanumerical Class designations (beginning with
the Class C-B-6 Certificates), until the respective Class Principal Balance of each such
Class has been reduced to zero, and second, to the Senior Certificates of the related
Certificate Group, as follows:
(A) with respect to the Group 1 Certificates, Realized Losses on the Group 1 Loans shall be
allocated first, to the Class C-M-1 Certificates, until its Class Principal Balance
has been reduced to zero, and second, to the Class 1-A-1 Certificates, until its Class
Principal Balance has been reduced to zero;
(B) with respect to the Group 2 Certificates, Realized Losses on the Group 2 Loans shall be
allocated first, to the Class 2-A-2 Certificates, until its Class Principal Balance
has been reduced to zero, and second, to the Class 2-A-1 Certificates, until its Class
Principal Balance has been reduced to zero; and
(C) with respect to the Group 3 Certificates, Realized Losses on the Group 3 Loans shall be
allocated first, to the Class C-M-1 Certificates, until its Class Principal Balance
has been reduced to zero, and second, to the Class 3-A-1 Certificates, until its Class
Principal Balance has been reduced to zero; and
(ii) Excess Losses in respect of principal for Mortgage Loans in Loan Group 1, Loan Group 2 and Loan
Group 3 shall be allocated among all Group 1, Group 2, Group 3 and Class C-B Certificates, pro
rata based on their respective Class Principal Balances.
(b) On each Distribution Date, if the aggregate Class Principal Balance of all Group 1, Group 2,
Group 3, Class C-B and Class C-M-1 Certificates exceeds the Aggregate Groups 1-3 Collateral Balance
(after giving effect to distributions of principal and the allocation of all losses to such Certificates
on such Distribution Date), such excess shall be deemed a principal loss and shall be allocated by the
Trust Administrator to the most junior Class of Class C-B Certificates then outstanding.
(c) Any Realized Loss allocated to a Class of Certificates or any reduction in the Class Principal
Balance of a Class of Certificates pursuant to Section 4.02(b) shall be allocated by the Trust
Administrator among the Certificates of such Class in proportion to their respective Certificate
Balances.
(d) Any allocation by the Trust Administrator of Realized Losses to a Certificate or any reduction
in the Certificate Balance of a Certificate pursuant to Section 4.02(b) shall be accomplished by
reducing the Certificate Balance thereof, immediately following the distributions made on the related
Distribution Date in accordance with the definition of "Certificate Balance."
(e) On each Distribution Date, the Trust Administrator shall determine the total Applied Loss
Amount with respect to the Group 4 Certificates, if any, for such Distribution Date. The Applied Loss
Amount with respect to the Group 4 Certificates for any Distribution Date shall be applied by reducing
the Class Principal Balance of each Class of the Class 4-B-1 Certificates, the Class 4-M Certificates
and the Class 4-A-4 Certificates, beginning with the Class of Certificates then outstanding with the
lowest relative payment priority (beginning with the Class 4-B-1 Certificates), in each case until the
respective Class Principal Balance thereof has been reduced to zero. Any Applied Loss Amount with
respect to the Group 4 Certificates allocated to a Class of the Class 4-B-1 Certificates, the Class 4-M
Certificates or the Class 4-A-4 Certificates shall be allocated among the Certificates of such Class in
proportion to their respective Percentage Interests.
(f) All Realized Losses on the Group 1, Group 2 and Group 3 Mortgage Loans shall be allocated on
each Distribution Date to the REMIC I Regular Interests as provided in the definition of REMIC I
Realized Losses.
(g) All Realized Losses on the Group 4 Mortgage Loans shall be allocated on each Distribution Date
to the REMIC II Regular Interests as provided in the definition of REMIC II Realized Losses.
(h) Realized Losses on the Group 4 Mortgage Loans that are not Applied Loss Amounts shall be deemed
allocated to the Class 4-X Certificates. Realized Losses allocated to the Class 4-X Certificates shall
be allocated between REMIC III Regular Interests 4-X-IO and 4-X-PO as provided in the definition of
Realized Losses.
SECTION 4.03. Recoveries.
(a) With respect to any Class of Certificates to which a Realized Loss or Applied Loss Amount, as
applicable, has been allocated (including any such Class for which the related Class Principal Balance
has been reduced to zero), the Class Principal Balance of such Class shall be increased, up to the
amount of related Recoveries for such Distribution Date as follows:
(i) with respect to Recoveries on Group 1, Group 2 and Group 3 Mortgage Loans,
(A) first, the Class Principal Balance of each Class of Senior Certificates related to the Loan
Group from which the Recovery was collected, shall be increased pro rata, up to the
amount of Net Recovery Realized Losses for each such Class, and
(B) second, the Class Principal Balance of each Class of Class C-B Certificates shall be increased
in order of seniority, up to the amount of Net Recovery Realized Losses for each such
Class; or
(ii) with respect to Recoveries on Group 4 Mortgage Loans, the Class Principal Balance of the
Class 4-A-4 Certificates, each Class of Class 4-M Certificates and the Class 4-B-1 Certificates
shall be increased in order of seniority, up to the Deferred Amount such Class is entitled to
receive pursuant to Section 4.01(II)(d) on such Distribution Date prior to giving effect to
payments pursuant to Section 4.01(II)(d) on such Distribution Date.
(b) Any increase to the Class Principal Balance of a Class of Certificates shall increase the
Certificate Balance of each Certificate of the related Class pro rata in accordance with each
Certificate Percentage Interest.
SECTION 4.04. Reserved.
SECTION 4.05. Monthly Statements to Certificateholders.
(a) Not later than each Distribution Date, the Trust Administrator shall prepare and cause to be
made available to each Certificateholder, the Master Servicer, each Servicer, the Trustee, the
Depositor, the Swap Counterparty and each Rating Agency, a statement setting forth with respect to the
related distribution: the items listed in Exhibit T, other than items (vi)(a), (vi)(b), (vi)(c) and
(vi)(d).
The Trust Administrator's responsibility for disbursing the above information to the
Certificateholders is limited to the availability, timeliness and accuracy of the information derived
from the Master Servicer and each Servicer, which shall be provided as required in Section 4.06.
On each Distribution Date, the Trust Administrator shall provide Bloomberg Financial
Markets, L.P. ("Bloomberg") CUSIP level factors for each Class of Offered Certificates as of such
Distribution Date, using a format and media mutually acceptable to the Trust Administrator and
Bloomberg. In connection with providing the information specified in this Section 4.05 to Bloomberg,
the Trust Administrator and any director, officer, employee or agent of the Trust Administrator shall be
indemnified and held harmless by DLJMC, to the extent, in the manner and subject to the limitations
provided in Section 9.05. The Trust Administrator shall also make the monthly statements to
Certificateholders available each month to each party referred to in Section 4.05(a) via the Trust
Administrator's website. The Trust Administrator's website can be accessed at xxxx://xxx.xxxxxxx.xxx or
at such other site as the Trust Administrator may designate from time to time. Persons that are unable
to use the above website are entitled to have a paper copy mailed to them via first class mail by
calling the Trust Administrator at 000-000-0000. The Trust Administrator shall have the right to change
the way the reports referred to in this Section 4.05 are distributed in order to make such distribution
more convenient and/or more accessible to the above parties and to the Certificateholders. The Trust
Administrator shall provide timely and adequate notification to all above parties and to the
Certificateholders regarding any such change. The Trust Administrator may fully rely upon and shall
have no liability with respect to information provided by the Master Servicer or any Servicer.
(b) Upon request, within a reasonable period of time after the end of each calendar year, the Trust
Administrator 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 (i)(c), (i)(d), (i)(g),
(i)(j), (i)(k), (ii)(c), (ii)(d), (ii)(g), (ii)(j), (v)(a), (v)(b), (v)(l), (v)(m) and (v)(n) of
Exhibit T aggregated for such calendar year or applicable portion thereof during which such Person was a
Certificateholder. Such obligation of the Trust Administrator shall be deemed to have been satisfied to
the extent that substantially comparable information shall be provided by the Trust Administrator
pursuant to any requirements of the Code as from time to time in effect.
SECTION 4.06. Servicer to Cooperate.
Each Servicer (except for SPS) shall provide to the Master Servicer the information
set forth in Exhibits H-1, H-2 and H-3 and any other information the Master Servicer requires, and SPS
shall provide to the Master Servicer the information set forth in Exhibits H-1, H-2, P and Q and any
other information the Master Servicer requires, in each case in such form as the Master Servicer shall
reasonably request, or in such form as may be mutually agreed upon between such Servicer and the Master
Servicer, with respect to each Mortgage Loan serviced by such Servicer no later than (i) with respect to
a Servicer other than Xxxxx Fargo, twelve noon on the Data Remittance Date, and (ii) with respect to
Xxxxx Fargo, on the Data Remittance Date, to enable the Master Servicer to provide such information to
the Trust Administrator.
Each Servicer also shall provide to the Master Servicer the information set forth in
Exhibit H-1, solely relating to Payoffs received during the related Prepayment Period, in such form as
the Master Servicer shall reasonably request, or in such form as may be mutually agreed upon between
such Servicer and the Master Servicer, with respect to each Mortgage Loan serviced by such Servicer no
later than the Additional Data Remittance Date, to enable the Master Servicer to provide such
information to the Trust Administrator.
The Master Servicer, with respect to the Mortgage Loans and each Distribution Date,
shall provide to the Trust Administrator the information set forth in Exhibits H-1, H-2 and H-3 in such
form as the Trust Administrator shall reasonably request no later than twelve noon on the related Data
Remittance Date or on the related Additional Data Remittance Date, as applicable, to enable the Trust
Administrator to calculate the amounts to be distributed to each Class of Certificates and otherwise
perform its distribution, accounting and reporting requirements hereunder.
SECTION 4.07. Cross-Collateralization; Adjustments to Available Funds.
(a) With respect to Loan Group 1, Loan Group 2 and Loan Group 3, on each Distribution Date prior to
the Class C-B Credit Support Depletion Date, but after the date on which the aggregate Class Principal
Balance of the Group 1, Group 2 or Group 3 Certificates has been reduced to zero (and in the case of the
Group 1 or Group 3 Certificates, the Class Principal Balance of the Class C-M-1 Certificates has also
been reduced to zero), the Trust Administrator shall distribute the principal portion of the Available
Distribution Amount on the Mortgage Loans relating to such Senior Certificates that will have been paid
in full, to the holders of the Senior Certificates of the other Certificate Group(s). Such amount shall
be allocated among the other Certificate Groups, pro rata, based on aggregate Class Principal Balance of
the related Senior Certificates and paid to the Senior Certificates in each such Certificate Group in
the same priority as such Certificates would receive other distributions of principal pursuant to
Section 4.01(I)(A); provided, however, that the Trust Administrator shall not make such distribution on
such Distribution Date if (a) the Class C-B Percentage for such Distribution Date is greater than or
equal to 200% of such Class C-B Percentage as of the Closing Date and (b) the average outstanding
principal balance of the Mortgage Loans in each Loan Group delinquent 60 days or more over the last six
months, as a percentage of the related Subordinate Component Balance, is less than 50%.
(b) With respect to Loan Group 1, Loan Group 2 and Loan Group 3, if on any Distribution Date the
aggregate Class Principal Balance of the Group 1, Group 2 or Group 3 Certificates (plus, in the case of
the Group 1 or Group 3 Certificates, the Class Principal Balance of the Class C-M-1 Certificates) is
greater than the Aggregate Loan Group Balance of the related Loan Group (each Loan Group related to such
Group of Certificates, an "Undercollateralized Group"), then the Trust Administrator shall reduce the
Available Distribution Amount of the other Loan Group(s) that is not undercollateralized (each, an
"Overcollateralized Group"), as follows:
(1) to add to the Available Distribution Amount of the Undercollateralized Group(s) an amount equal
to the lesser of (a) one month's interest on the Principal Transfer Amount of the
Undercollateralized Group(s) at the Net WAC Rate applicable to the Undercollateralized Group(s)
and (b) the Available Distribution Amount of the Overcollateralized Groups remaining after
making interest distributions to the Senior Certificates of the Overcollateralized Group(s) on
such Distribution Date pursuant to Section 4.01; and
(2) to the Senior Certificates of each Undercollateralized Group, to the extent of the principal
portion of the Available Distribution Amount of the Overcollateralized Group(s) remaining after
making interest and principal distributions to the Senior Certificates of the
Overcollateralized Group(s) on such Distribution Date pursuant to Section 4.01, until the Class
Principal Balance of the Senior Certificates of such Undercollateralized Group(s) equals the
Aggregate Loan Group Balance of the related Loan Group(s). Payments shall be made to the
Senior Certificates in each Group in the same priority as such Certificates would receive other
distributions of principal pursuant to Section 4.01(I)(A).
(c) If more than one Overcollateralized Group exists on any Distribution Date, reductions in the
Available Distribution Amount of such Groups to make the payments required to be made pursuant to
Section 4.07(b) on such Distribution Date shall be made pro rata, based on the Overcollateralization
Amount of each Overcollateralized Group. If more than one Undercollateralized Group exists on any
Distribution Date, payments made to such Groups from the Available Distribution Amount of the
Overcollateralized Group shall be made pro rata, based on the amount of payments required to be made to
the Undercollateralized Group(s).
SECTION 4.08. Group 4 Interest Rate Cap Accounts.
(a) On the Closing Date, the Trust Administrator shall establish and maintain in its name, on
behalf of the Trustee and in trust for the benefit of the Holders of the Class 4-X Certificates, an
account relating to the Class 4-A-1/4-A-3/4-A-4 Interest Rate Cap Agreement (the
"Class 4-A-1/4-A-3/4-A-4 Interest Rate Cap Account"), an account relating to the Class 4-A-2 Interest
Rate Cap Agreement (the "Class 4-A-2 Interest Rate Cap Account") and an account relating to the
Class 4-M/4-B Interest Rate Cap Agreement (the "Class 4-M/4-B Interest Rate Cap Account"). Each Group 4
Interest Rate Cap Account shall be an Eligible Account, and funds on deposit therein shall be held
separate and apart from, and shall not be commingled with, any other moneys, including without
limitation, other moneys held by the Trust Administrator pursuant to this Agreement.
(b) On each Distribution Date on and after the Distribution Date in August 2006 and on and prior to
the Distribution Date in December 2010, the Trust Administrator shall deposit any amounts paid under the
Class 4-A-1/4-A-3/4-A-4 Interest Rate Cap Agreement into the Class 4-A-1/4-A-3/4-A-4 Interest Rate Cap
Account. On any Distribution Date, amounts on deposit in the Class 4-A-1/4-A-3/4-A-4 Interest Rate Cap
Account shall be distributed, pro rata based on amounts due, to the Class 4-A-1-1, Class 4-A-1-2,
Class 4-A-3-1, Class 4-A-3-2, Class 4-A-3-3 and Class 4-A-4 Certificates, in an amount equal to any
unpaid Basis Risk Shortfall for such class. Amounts in respect of Basis Risk Shortfalls paid pursuant
to the preceding sentence shall be made prior to giving effect to any amounts available to be paid in
respect of such Basis Risk Shortfalls pursuant to Section 4.01(II)(d)(xiii)(a) on such Distribution
Date. On any Distribution Date, after distributions in respect of Basis Risk Shortfalls on the
Class 4-A-1-1, Class 4-A-1-2, Class 4-A-3-1, Class 4-A-3-2, Class 4-A-3-3 and Class 4-A-4 Certificates
pursuant to the first sentence of this clause (b), the pro rata share of amounts remaining on deposit in
the Class 4-A-1/4-A-3/4-A-4 Interest Rate Cap Account, weighted based on the amount remaining on deposit
in the Class 4-A-1/4-A-3/4-A-4 Interest Rate Cap Account as a percentage of the aggregate amount
remaining in the Class 4-A-1/4-A-3/4-A-4 Interest Rate Cap Account, the Class 4-A-2 Interest Rate Cap
Account and the Class 4-M/4-B Interest Rate Cap Account, in each case after making payments in respect
of Basis Risk Shortfalls on the related Certificates and with respect to the Class 4-A-2 Interest Rate
Cap Account, payments to the Supplemental Interest Trust, shall be distributed first, to the Principal
Remittance Amount, up to the amount of Realized Losses on the Mortgage Loans in Loan Group 4 incurred
during the related Collection Period and second, sequentially, to the Class 4-A-4, Class 4-M-1,
Class 4-M-2, Class 4-M-3, Class 4-M-4, Class 4-M-5, Class 4-M-6, Class 4-M-7, Class 4-M-8, Class 4-M-9
and Class 4-B-1 Certificates, in that order, any applicable Deferred Amounts, with interest therein at
the applicable Pass-Through Rate, prior to giving effect to amounts available to be paid in respect of
Deferred Amounts as described in Section 4.01(II)(d)(ii)-(xii) on such Distribution Date.
Amounts paid under the Class 4-A-1/4-A-3/4-A-4 Interest Rate Cap Agreement not used on
any Distribution Date as described above shall remain on deposit in the Class 4-A-1/4-A-3/4-A-4 Interest
Rate Cap Account and may be available on future Distribution Dates to make the payments described in
this Section 4.08(c). However, at no time shall the amount on deposit in the Class 4-A-1/4-A-3/4-A-4
Interest Rate Cap Account exceed the Class 4-A-1/4-A-3/4-A-4 Deposit Amount. The
"Class 4-A-1/4-A-3/4-A-4 Deposit Amount" shall be calculated on each Distribution Date, after giving
effect to withdrawals from the Class 4-A-1/4-A-3/4-A-4 Interest Rate Cap Account on such Distribution
Date and distributions and allocation of Realized Losses on the Group 4 Certificates on such
Distribution Date, and will equal the product of (x) a fraction, expressed as a percentage, the
numerator of which is equal to the aggregate Class Principal Balance of the Class 4-A-1-1,
Class 4-A-1-2, Class 4-A-3-1, Class 4-A-3-2, Class 4-A-3-3 and Class 4-A-4 Certificates after giving
effect to distributions and allocations of Realized Losses on such Distribution Date, and the
denominator of which is equal to the aggregate Class Principal Balance of the Group 4 Certificates
(other than the Class 4-X Certificates) after giving effect to distributions and allocations of Realized
Losses on such Distribution Date and (2) the excess, if any, of the Targeted Overcollateralization
Amount for such Distribution Date over the Overcollateralization Amount for such Distribution Date. On
each Distribution Date, the Trust Administrator shall distribute amounts in the Class 4-A-1/4-A-3/4-A-4
Interest Rate Cap Account in excess of the Class 4-A-1/4-A-3/4-A-4 Deposit Amount to the Class 4-X
Certificateholders. On the Distribution Date immediately after the Distribution Date on which the
aggregate Class Principal Balance of the Class 4-A-1-1, Class 4-A-1-2, Class 4-A-3-1, Class 4-A-3-2,
Class 4-A-3-3 and Class 4-A-4 Certificates equals zero, any amounts on deposit in the
Class 4-A-1/4-A-3/4-A-4 Interest Rate Cap Account not payable on the Group 4 Certificates shall be
distributed to the Class 4-X Certificateholders.
(c) On each Distribution Date on and after the Distribution Date in August 2006 and on and prior to
the Distribution Date in December 2010, the Trust Administrator shall deposit any amounts paid under the
Class 4-A-2 Interest Rate Cap Agreement into the Class 4-A-2 Interest Rate Cap Account. On any
Distribution Date or, in the case of payments to the Supplemental Interest Trust, on the related Swap
Payment Date, amounts on deposit in the Class 4-A-2 Interest Rate Cap Account shall be distributed
first, to the Supplemental Interest Trust for payment to the Swap Counterparty, an amount equal to any
Swap Fee Reimbursement Amount for such Swap Payment Date or remaining unpaid from any prior Swap Payment
Date and second, pro rata based on amounts due (1) to the Supplemental Interest Trust for payment to the
Swap Counterparty, the Swap Counterparty Reimbursement Amount for the related Swap Payment Date or
remaining unpaid from any prior Swap Payment Date and (2) on any Distribution Date on which a Swap
Suspension Event has occurred and is continuing, to the Class 4-A-2 Certificates, an amount equal to any
unpaid Basis Risk Shortfall for such class. Amounts in respect of Basis Risk Shortfalls paid pursuant
to the preceding sentence shall be made prior to giving effect to any amounts available to be paid in
respect of such Basis Risk Shortfalls pursuant to Section 4.01(II)(d)(xiii)(b)(ii) on such Distribution
Date. On any Distribution Date or, in the case of payments to the Supplemental Interest Trust, on the
related Swap Payment Date, after distributions to the Supplemental Interest Trust and in respect of
Basis Risk Shortfalls on the Class 4-A-2 Certificates pursuant to the first sentence of this clause (c),
the pro rata share, or amounts remaining on deposit in the Class 4-A-2 Interest Rate Cap Account,
weighted based on the amount remaining on deposit in the Class 4-A-2 Interest Rate Cap Account as a
percentage of the aggregate amount remaining in the Class 4-A-1/4-A-3/4-A-4 Interest Rate Cap Account,
the Class 4-A-2 Interest Rate Cap Account and the Class 4-M/4-B Interest Rate Cap Account, in each case
after making payments in respect of Basis Risk Shortfalls on the related Certificates and with respect
to the Class 4-A-2 Interest Rate Cap Account, payments to the Supplemental Interest Trust, shall be
distributed first, to the Principal Remittance Amount, up to the amount of Realized Losses on the
Mortgage Loans in Loan Group 4 incurred during the related Collection Period and second, sequentially,
to the Class 4-A-4, Class 4-M-1, Class 4-M-2, Class 4-M-3, Class 4-M-4, Class 4-M-5, Class 4-M-6,
Class 4-M-7, Class 4-M-8, Class 4-M-9 and Class 4-B-1 Certificates, in that order, any applicable
Deferred Amounts, with interest therein at the applicable Pass-Through Rate, prior to giving effect to
amounts available to be paid in respect of Deferred Amounts as described in
Section 4.01(II)(d)(ii)-(xii) on such Distribution Date.
Amounts paid under the Class 4-A-2 Interest Rate Cap Agreement not used on any
Distribution Date as described above shall remain on deposit in the Class 4-A-2 Interest Rate Cap
Account and may be available on future Distribution Dates to make the payments described in this
Section 4.08(d). However, at no time shall the amount on deposit in the Class 4-A-2 Interest Rate Cap
Account exceed the Class 4-A-2 Deposit Amount. The "Class 4-A-2 Deposit Amount" shall be calculated on
each Distribution Date, after giving effect to withdrawals from the Class 4-A-2 Interest Rate Cap
Account on such Distribution Date and distributions and allocation of Realized Losses on the Group 4
Certificates on such Distribution Date, and will equal the product of (x) a fraction, expressed as a
percentage, the numerator of which is equal to the Class Principal Balance of the Class 4-A-2
Certificates after giving effect to distributions and allocations of Realized Losses on such
Distribution Date, and the denominator of which is equal to the aggregate Class Principal Balance of the
Group 4 Certificates (other than the Class 4-X Certificates) after giving effect to distributions and
allocations of Realized Losses on such Distribution Date and (2) the excess, if any, of the Targeted
Overcollateralization Amount for such Distribution Date over the Overcollateralization Amount for such
Distribution Date. On each Distribution Date, the Trust Administrator shall distribute amounts in the
Class 4-A-2 Interest Rate Cap Account in excess of the Class 4-A-2 Deposit Amount to the Class 4-X
Certificateholders. On the Distribution Date immediately after the Distribution Date on which the
aggregate Class Principal Balance of the Class 4-A-2 Certificates equals zero, any amounts on deposit in
the Class 4-A-2 Interest Rate Cap Account not payable on the Group 4 Certificates shall be distributed
to the Class 4-X Certificateholders.
(d) On each Distribution Date on and after the Distribution Date in August 2006 and on and prior to
the Distribution Date in December 2010, the Trust Administrator shall deposit any amounts paid under the
Class 4-M/4-B Interest Rate Cap Agreement into the Class 4-M/4-B Interest Rate Cap Account. On any
Distribution Date, amounts on deposit in the Class 4-M/4-B Interest Rate Cap Account shall be
distributed, pro rata based on amounts due, to each Class of Class 4-M and Class 4-B-1 Certificates, in
an amount equal to any unpaid Basis Risk Shortfall for such class. Amounts in respect of Basis Risk
Shortfalls paid pursuant to the preceding sentence shall be made prior to giving effect to any amounts
available to be paid in respect of such Basis Risk Shortfalls pursuant to
Section 4.01(II)(d)(xiv)-(xxiii) on such Distribution Date. On any Distribution Date, after
distributions in respect of Basis Risk Shortfalls on each Class of Class 4-M and Class 4-B-1
Certificates pursuant to the first sentence of this clause (d), the pro rata share of amounts remaining
on deposit in the Class 4-M/4-B Interest Rate Cap Account, weighted based on the amount remaining on
deposit in the Class 4-M/4-B Interest Rate Cap Account as a percentage of the aggregate amount remaining
in the Class 4-A-1/4-A-3/4-A-4 Interest Rate Cap Account, the Class 4-A-2 Interest Rate Cap Account and
the Class 4-M/4-B Interest Rate Cap Account, in each case after making payments in respect of Basis Risk
Shortfalls on the related Certificates and with respect to the Class 4-A-2 Interest Rate Cap Account,
payments to the Supplemental Interest Trust, shall be distributed first, to the Principal Remittance
Amount, up to the amount of Realized Losses on the Mortgage Loans in Loan Group 4 incurred during the
related Collection Period and second, sequentially, to the Class 4-A-4, Class 4-M-1, Class 4-M-2,
Class 4-M-3, Class 4-M-4, Class 4-M-5, Class 4-M-6, Class 4-M-7, Class 4-M-8, Class 4-M-9 and Class 4-B-1
Certificates, in that order, any applicable Deferred Amounts, with interest therein at the applicable
Pass-Through Rate, prior to giving effect to amounts available to be paid in respect of Deferred Amounts
as described in Section 4.01(II)(d)(ii)-(xii) on such Distribution Date.
Amounts paid under the Class 4-M/4-B Interest Rate Cap Agreement not used on any
Distribution Date as described above shall remain on deposit in the Class 4-M/4-B Interest Rate Cap
Account and may be available on future Distribution Dates to make the payments described in this
Section 4.08(c). However, at no time shall the amount on deposit in the Class 4-M/4-B Interest Rate Cap
Account exceed the Class 4-M/4-B Deposit Amount. The "Class 4-M/4-B Deposit Amount" shall be calculated
on each Distribution Date, after giving effect to withdrawals from the Class 4-M/4-B Interest Rate Cap
Account on such Distribution Date and distributions and allocation of Realized Losses on the Group 4
Certificates on such Distribution Date, and will equal the product of (x) a fraction, expressed as a
percentage, the numerator of which is equal to the aggregate Class Principal Balance of the Class 4-M
and Class 4-B-1 Certificates after giving effect to distributions and allocations of Realized Losses on
such Distribution Date, and the denominator of which is equal to the aggregate Class Principal Balance
of the Group 4 Certificates (other than the Class 4-X Certificates) after giving effect to distributions
and allocations of Realized Losses on such Distribution Date and (2) the excess, if any, of the Targeted
Overcollateralization Amount for such Distribution Date over the Overcollateralization Amount for such
Distribution Date. On each Distribution Date, the Trust Administrator shall distribute amounts in the
Class 4-M/4-B Interest Rate Cap Account in excess of the Class 4-M/4-B Deposit Amount to the Class 4-X
Certificateholders. On the Distribution Date immediately after the Distribution Date on which the
aggregate Class Principal Balance of the Class 4-M and Class 4-B-1 Certificates equals zero, any amounts
on deposit in the Class 4-M/4-B Interest Rate Cap Account not payable on the Group 4 Certificates shall
be distributed to the Class 4-X Certificateholders.
(e) Funds in the Group 4 Interest Rate Cap Accounts may be invested in Eligible Investments by the
Trust Administrator at the direction of the Depositor maturing on or prior to the next succeeding
Distribution Date. The Trust Administrator shall account for each Group 4 Interest Rate Cap Account as
an outside reserve fund within the meaning of Treasury regulation 1.860G-2(h) and not an asset of any
REMIC created pursuant to this Agreement. The Trust Administrator shall treat amounts paid from the
Group 4 Interest Rate Cap Accounts as payments made from outside the REMICs for all Federal tax
purposes. Any net investment earnings on such amounts shall be payable to the Depositor. The Depositor
will be the owner of the Group 4 Interest Rate Cap Accounts for federal tax purposes and the Depositor
shall direct the Trust Administrator in writing as to the investment of amounts therein. In the absence
of such written direction, all funds in the Group 4 Interest Rate Cap Accounts may be invested by the
Trust Administrator in the Xxxxx Fargo Advantage Prime Investment Money Market Fund or any successor
fund. The Trust Administrator shall have no liability for losses on investments in Eligible Investments
made pursuant to this Section 4.08(c) (other than as obligor on any such investments). Upon termination
of the Trust Fund, any amounts remaining in the Group 4 Interest Rate Cap Accounts shall be distributed
to the Class 4-X Certificateholders.
(f) The Trust Administrator is hereby directed, on or prior to the Closing Date, on behalf of the
Trust and the Trustee, to enter into the Group 4 Interest Rate Cap Agreements for the benefit of the
Holders of the Group 4 Certificates, in the form presented to it by the Depositor. The Trust
Administrator shall not have any responsibility for the contents, adequacy or sufficiency of the Group 4
Interest Rate Cap Agreements, including, without limitation, any representations and warranties
contained therein. The Trust Administrator shall administer, hold, and receive and make all payments
under the Group 4 Interest Rate Cap Agreements on behalf of the Trust and the Trustee in accordance with
its terms and the provisions of this Agreement.
(g) Upon any failure by the Group 4 Interest Rate Cap Counterparty to make, when due, any Transfer
of Eligible Collateral, Posted Collateral or the Interest Amount with respect to any Group 4 Interest
Rate Cap Agreement (as such terms are defined in such Group 4 Interest Rate Cap Agreement), the Trust
Administrator shall deliver to the Group 4 Interest Rate Cap Counterparty the notice contemplated by
Paragraph 7(i) of the related Credit Support Annex attached to such Group 4 Interest Rate Cap Agreement
of the Group 4 Interest Rate Cap Counterparty's failure to do so. The Trust Administrator shall deliver
such notice no later than 1:00 p.m. eastern time on the Business Day immediately following any such
failure by the Group 4 Interest Rate Cap Counterparty.
SECTION 4.09. Supplemental Interest Trust.
(a) A separate trust is hereby established (the "Supplemental Interest Trust"), the corpus of which
shall be held by the Supplemental Interest Trust Trustee, in trust, for the benefit of the holders of
the Class 4-A-2 Certificates. On the Closing Date, the Supplemental Interest Trust Trustee shall
establish and maintain in its name, a separate account for the benefit of the holders of the Class 4-A-2
Certificates (the "Supplemental Interest Account"). The Supplemental Interest Account shall be an
Eligible Account, and funds on deposit therein shall be held separate and apart from, and shall not be
commingled with, any other moneys, including, without limitation, other moneys of the Trust
Administrator held pursuant to this Agreement.
(b) The Trust Administrator shall deposit into the Supplemental Interest Account the amounts set
forth in Section 4.01(II)(a), (b), (c) and (d). The Supplemental Interest Trust Trustee shall deposit
into the Supplemental Interest Account any Net Swap Payments received from the Swap Counterparty. On
any Swap Payment Date on which a Net Swap Payment is owed to the Swap Counterparty, the Supplemental
Interest Trust Trustee shall withdraw from the Supplemental Interest Account an amount equal to such Net
Swap Payment and pay such amount to the Swap Counterparty. On each Swap Payment Date on which a Net
Swap Payment is owed to the Trust Fund, the Supplemental Interest Trust Trustee shall withdraw from the
Supplemental Interest Account an amount equal to such Net Swap Payment and pay such amount to the Trust
Fund for distribution on the related Distribution Date in accordance with the provisions of
subparagraph (f) of this Section 4.09.
(c) Funds in the Supplemental Interest Account shall be invested in Eligible Investments, which
shall mature not later than the Business Day prior to the Swap Payment Date. The Depositor shall direct
the Supplemental Interest Trust Trustee in writing as to the investment of amounts in the Supplemental
Interest Account. In the absence of such written direction, all funds in the Supplemental Interest
Account may be invested by the Supplemental Interest Trust Trustee in the Xxxxx Fargo Advantage Prime
Money Market Fund or any successor fund. The Supplemental Interest Trust Trustee shall have no
liability for losses an investments in Eligible Investments made pursuant to this Section 4.09(c) (other
than as obligor on any such investments). Any earnings on such amounts shall be distributed on each
Distribution Date pursuant to paragraph (f) of this Section 4.09.
(d) Upon termination of the Trust Fund and after payment of any moneys to the holders of the
Class 4-A-2 Certificates as provided in paragraph (f) of this Section 4.09, any amounts remaining in the
Supplemental Interest Account after payment of amounts owing to the Swap Counterparty shall be
distributed to the holder of the Class 4-X Certificates.
(e) The Trust Administrator is hereby directed, as Supplemental Interest Trust Trustee, and not in
its individual capacity, on or prior to the Closing Date, on behalf of the Supplemental Interest Trust,
to enter into and assume the obligations under the Swap Agreement with the Swap Counterparty for the
benefit of the Holders of the Class 4-A-2 Certificates, in the form presented to it by the Depositor.
Neither the Trust Administrator nor the Supplemental Interest Trust Trustee shall, individually or
personally, have any liability to perform any covenant either express or implied contained in the Swap
Agreement and under no circumstance shall the Trust Administrator be personally liable for the payment
of any amounts payable by the Supplemental Interest Trust under the Swap Agreement or any expenses of
the Supplemental Interest Trust or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by the Supplemental Interest Trust under the
Swap Agreement. None of the Master Servicer, Trustee, Trust Administrator or Supplemental Interest
Trust Trustee shall have a duty to review or otherwise determine the adequacy of the Swap Agreement (or
any amendment or supplement thereto).
(f) On each Distribution Date, the Trust Administrator shall distribute any amounts it receives
from the Supplemental Interest Account in respect of the related Net Swap Payment owed by the Swap
Counterparty, to pay to the holders of the Class 4-A-2 Certificates an amount equal to the product of
(a) the positive excess of the Formula Rate for the Class 4-A-2 Certificates for such Distribution Date
over the Net Funds Cap for such Distribution Date, (b) a fraction, the numerator of which is the actual
number of days elapsed in the related Calculation Period and the denominator of which is 360, and
(c) the Swap Notional Amount. Any amounts in the Supplemental Interest Account relating to such Net Swap
Payment remaining after distribution to the holders of the Class 4-A-2 Certificates shall be distributed
to the holders of the Class 4-X Certificates. On any Distribution Date, any amounts that the Trust
Administrator receives from the Supplemental Interest Account at any time since the immediately
preceding Distribution Date in respect of Net Swap Payments owed by the Swap Counterparty on prior
related Swap Payment Dates shall be, first, distributed to the holders of the Class 4-A-2 Certificates
in reduction of any Basis Risk Shortfalls for such Class, until the amount of any Basis Risk Shortfalls
due and owing for such Class and, second, distributed to the holders of the Class 4-X Certificates.
(g) The Supplemental Interest Trust Trustee shall deliver to the Swap Counterparty the notice
contemplated by Paragraph 7(i) of the Credit Support Annex attached to the Swap Agreement if the Swap
Counterparty fails to make, when due, any Transfer of Eligible Collateral, Posted Collateral or the
Interest Amount (as such terms are defined in the Swap Agreement) required to be made by the Swap
Counterparty. The Supplemental Interest Trust Trustee shall deliver such notice no later than 1:00 p.m.
eastern time on the Business Day immediately following any such failure by the Swap Counterparty.
SECTION 4.10. Rights of Swap Counterparty.
The Swap Counterparty shall be deemed a third-party beneficiary of this Agreement to
the same extent as if it were a party hereto and shall have the right to enforce its rights under this
Agreement. For the protection and enforcement of the provisions of this Section, the Swap Counterparty
shall be entitled to relief as can be given either at law or in equity.
SECTION 4.11. Replacement Swap Counterparty.
(a) In the event that the Supplemental Interest Trust Trustee, on behalf of the Supplemental
Interest Trust, and at the direction of the Depositor, enters into a replacement interest rate swap
agreement with a replacement swap counterparty (the "Replacement Swap Counterparty"), then (a) to the
extent that the Supplemental Interest Trust would be required to make a Swap Termination Payment to the
Swap Counterparty and (b) to the extent the Replacement Swap Counterparty pays to assume the rights and
obligations of the Swap Counterparty under the Swap Agreement (the "Replacement Payment"), the
Supplemental Interest Trust Trustee, on behalf of the Supplemental Interest Trust, and the Swap
Counterparty agree that such Replacement Payment shall be paid to the Swap Counterparty and shall, only
to the extent actually paid by the Replacement Swap Counterparty to the Swap Counterparty, constitute
satisfaction in full of the obligations of the Supplemental Interest Trust to the Swap Counterparty in
respect of the assignment of the outstanding transaction under the Swap Agreement to the Replacement
Swap Counterparty or the replacement of such transaction with the Replacement Swap Counterparty. In
addition, upon termination of the Swap Counterparty and to the extent that the Swap Counterparty would
be required to make a Swap Termination Payment to the Supplemental Interest Trust, such Swap Termination
Payment shall be deposited into the Supplement Interest Account and shall be used to make any upfront
payment required to be made to a Replacement Swap Counterparty.
(b) Notwithstanding anything to the contrary contained herein, in the event that a replacement swap
agreement is not obtained within 30 days after receipt by the Trust Administrator of the Swap
Termination Payment paid by the terminated Swap Counterparty, the Trust Administrator shall deposit such
Swap Termination Payment into the Supplemental Interest Account and the Trust Administrator shall, on
each Distribution Date, withdraw from such Supplemental Interest Account, an amount equal to the Net
Swap Payment, if any, that would have been paid to the Supplemental Interest Trust by the original Swap
Counterparty (computed in accordance with the terms of the original Swap Agreement) and distribute such
amount in accordance with Section 4.01 of this Agreement.
ARTICLE V
ADVANCES BY THE MASTER SERVICER AND SERVICERS
SECTION 5.01. Advances by the Master Servicer and Servicers.
With respect to the Non-Designated Mortgage Loans, each Servicer shall deposit in the
related Collection Account as Advances an amount equal to all Scheduled Payments (with interest at the
Mortgage Rate less the Servicing Fee Rate) which were due on such Non-Designated Mortgage Loans serviced
by it during the applicable Collection Period and which were delinquent at the close of business on the
immediately preceding Determination Date; provided, however, that with respect to any Balloon Loan that
is delinquent on its maturity date, a Servicer shall not be required to advance the related balloon
payment but shall be required to continue to make Advances in accordance with this Section 5.01 with
respect to such Balloon Loan in an amount equal to an assumed scheduled payment that would otherwise be
due based on the original amortization schedule for that Mortgage Loan (with interest at the Mortgage
Rate less the Servicing Fee Rate). Each Servicer's obligation to make such Advances as to any related
Non-Designated Mortgage Loan shall continue through the last Scheduled Payment due prior to the payment
in full of such Non-Designated Mortgage Loan, or through the date that the related Mortgaged Property
has, in the judgment of the related Servicer, been completely liquidated. Each Servicer shall not be
required to advance shortfalls of principal or interest resulting from the application of the Relief Act.
With respect to any Non-Designated Mortgage Loan, to the extent required by Accepted
Servicing Practices, the Master Servicer and each Servicer shall be obligated to make Advances in
accordance with the provisions of this Agreement; provided, however, that such obligation with respect
to any related Non-Designated Mortgage Loan shall cease if the Master Servicer or a Servicer determines,
in its reasonable opinion, that Advances with respect to such Non-Designated Mortgage Loan are
Nonrecoverable Advances. In the event that the Master Servicer or such Servicer determines that any such
Advances are Nonrecoverable Advances, the Master Servicer or such Servicer shall provide the Trust
Administrator with a certificate signed by a Servicing Officer evidencing such determination.
With respect to any Non-Designated Mortgage Loan, if the amount of Advances received
from a Servicer is less than the amount required to be advanced by such Servicer, the Master Servicer
shall be obligated to make a payment in an amount equal to such deficiency, subject to any determination
by the Master Servicer that any portion of the amount required to be advanced is a Nonrecoverable
Advance.
With respect to any of the Non-Designated Mortgage Loans, if an Advance is required to
be made hereunder by a Servicer, such Servicer shall on the Cash Remittance Date either (i) deposit in
the Collection Account from its own funds an amount equal to such Advance, (ii) cause to be made an
appropriate entry in the records of the Collection Account that funds in such account being held for
future distribution or withdrawal have been, as permitted by this Section 5.01, used by such Servicer to
make such Advance or (iii) make Advances in the form of any combination of clauses (i) and
(ii) aggregating the amount of such Advance. Any such funds being held in a Collection Account for future
distribution and so used shall be replaced by such Servicer from its own funds by deposit in such
Collection Account on or before any future Distribution Date in which such funds would be due or from
other funds in such Collection Account being held for future distribution at that time.
With respect to any Designated Mortgage Loan, the Master Servicer shall make Advances
as required by Section 3.20(b) of this Agreement.
ARTICLE VI
THE CERTIFICATES
SECTION 6.01. The Certificates.
The Certificates shall be in substantially the forms set forth in Exhibits A, B, C,
D-1, D-2, E, F and G hereto, with such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Agreement or as may in the reasonable judgment of the
Trust Administrator or the Depositor be necessary, appropriate or convenient to comply, or facilitate
compliance, with applicable laws, and may have such letters, numbers or other marks of identification
and such legends or endorsements placed thereon as may be required to comply with the rules of any
securities exchange on which any of the Certificates may be listed, or as may, consistently herewith, be
determined by the officers executing such Certificates, as evidenced by their execution thereof.
Subject to Section 11.03 respecting the final distribution on the Certificates, on
each Distribution Date the Trust Administrator 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 Trust Administrator 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 Principal
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 definitive Certificates shall be printed, typewritten, lithographed or engraved or
produced by any combination of these methods or may be produced in any other manner permitted by the
rules of any securities exchange on which any of the Certificates may be listed, all as determined by
the officers executing such Certificates, as evidenced by their execution thereof.
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.
The Certificates shall be executed by manual or facsimile signature on behalf of the
Trust Administrator by a Responsible 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 Trust Administrator shall bind the Trust Administrator, notwithstanding that such individuals or any
of them have ceased to be so authorized prior to the authentication 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 there appears on such Certificate a
certificate of authentication executed by the Trust Administrator by manual signature, and such
certificate of authentication upon any Certificate shall be conclusive evidence, and the only evidence,
that such Certificate has been duly authenticated and delivered hereunder. All Certificates shall be
dated the date of their authentication.
SECTION 6.02. Registration of Transfer and Exchange of Certificates.
(a) The Trust Administrator shall maintain, or cause to be maintained, a Certificate Register in
which, subject to such reasonable regulations as it may prescribe, the Trust Administrator 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 Trust Administrator shall execute,
authenticate and deliver, in the name of the designated transferee or transferees, one or more new
Certificates in like aggregate interest and of the same Class.
(b) At the option of a Certificateholder, Certificates may be exchanged for other Certificates of
authorized denominations and the same aggregate interest in the Trust Fund and of the same Class, upon
surrender of the Certificates to be exchanged at the office or agency of the Trust Administrator set
forth in Section 6.06. Whenever any Certificates are so surrendered for exchange, the Trust
Administrator 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 Trust Administrator duly executed by the Holder thereof or his attorney duly authorized in writing.
(c) 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.
(d) All Certificates surrendered for registration of transfer and exchange shall be canceled and
subsequently destroyed by the Trust Administrator in accordance with the Trust Administrator's customary
procedures.
(e) No transfer of any Private Certificate shall be made unless that transfer is made pursuant to
an effective registration statement under the 1933 Act and effective registration or qualification under
applicable state securities laws, or is made in a transaction which does not require such registration
or qualification. Except in connection with any transfer of a Private Certificate by the Depositor to
any affiliate or any transfer of a Private Certificate from the Depositor or an affiliate of the
Depositor to an owner trust or other entity established by the Depositor, in the event that a transfer
is to be made in reliance upon an exemption from the 1933 Act and such laws, in order to assure
compliance with the 1933 Act and such laws, the Certificateholder desiring to effect such transfer and
such Certificateholder's prospective transferee shall each certify to the Trust Administrator in writing
the facts surrounding the transfer in substantially the form set forth in Exhibit L (the "Transferor
Certificate") and (i) deliver a letter in substantially the form of either (A) Exhibit M-1 (the
"Investment Letter"), provided that all of the Private Certificates of a Class shall be transferred to
one investor or the Depositor otherwise consents to such transfer, (B) Exhibit M-2 (the "Rule 144A
Letter") or (C) Exhibit M-3 (the "Regulation S Letter") or (ii) there shall be delivered to the Trust
Administrator at the expense of the transferor an Opinion of Counsel that such transfer may be made
pursuant to an exemption from the 1933 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) or Regulation S, as applicable, for transfer
of any such Certificate without registration thereof under the 1933 Act pursuant to the registration
exemption provided by Rule 144A or Regulation S. The Trust Administrator shall cooperate with the
Depositor in providing the 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 Trust Administrator, the Depositor, the Seller, the Master Servicer, each
Servicer and the Special 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.
(f) Except in connection with any transfer of a Private Certificate by the Depositor to any
affiliate or any transfer of a Private Certificate from the Depositor or an affiliate of the Depositor
to an owner trust or other entity established by the Depositor, no transfer of an ERISA-Restricted
Certificate (except for the Residual Certificates) shall be made unless the Trust Administrator shall
have received in accordance with Exhibit M-1, Exhibit M-2 or Exhibit M-3, as applicable, either (i) a
representation letter from the transferee of such Certificate, acceptable to and in form and substance
satisfactory to the Trust Administrator, to the effect that such transferee is not an employee benefit
plan or arrangement subject to Section 406 of ERISA or Section 4975 of the Code, or a person using the
assets of any such plan or arrangement, which representation letter shall not be an expense of the
Trustee, the Trust Administrator or the Trust Fund, (ii) if the purchaser is an insurance company and
the Certificate has been the subject of an ERISA-Qualifying Underwriting, a representation that the
purchaser is an insurance company which is purchasing such Certificates with funds contained in an
"insurance company general account" (as such term is defined in Section V(e) of Prohibited Transaction
Class Exemption 95-60 ("PTCE 95-60")) and that the purchase and holding of such Certificates are covered
under Sections I and III of PTCE 95-60 or (iii) in the case of any such Certificate presented for
registration in the name of an employee benefit plan or arrangement subject to Section 406 of ERISA or
Section 4975 of the Code (or comparable provisions of any subsequent enactments), or a person using such
plan's or arrangement's assets, an Opinion of Counsel satisfactory to the Trust Administrator to the
effect that the purchase or holding of such Certificate will not result in prohibited transactions under
Section 406 of ERISA and/or Section 4975 of the Code and will not subject the Depositor, the Trustee,
the Trust Administrator, the Master Servicer or any other Servicer to any obligation in addition to
those undertaken in this Agreement, which Opinion of Counsel shall not be an expense of such parties or
the Trust Fund. No transfer of a Residual Certificate shall be made unless the Trust Administrator
shall have received, in accordance with Exhibit N, a representation letter from the transferee of such
Certificate, acceptable to and in form and substance satisfactory to the Trust Administrator, to the
effect that such transferee is not an employee benefit plan or arrangement subject to Section 406 of
ERISA or Section 4975 of the Code, or a person using the assets of any such plan or arrangement, which
representation letter shall not be an expense of the Trustee, the Trust Administrator or the Trust
Fund. In the event the representations referred to in this Section 6.02(f) are not furnished, such
representations shall be deemed to have been made to the trustee by the transferee's acceptance of such
ERISA-Restricted Certificate by any beneficial owner who purchases an interest in such Certificate in
book-entry form. In the event that a representation is violated, or any attempt to transfer an
ERISA-Restricted Certificate to a plan or arrangement or person using a plan's or arrangement's assets is
attempted without the delivery to the Trust Administrator of the Opinion of Counsel described above, the
attempted transfer or acquisition of such Certificate shall be void and of no effect.
(g) Additional restrictions on transfers of the Class AR and Class AR-L Certificates are set forth
below:
(i) 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 to have irrevocably authorized the Trust Administrator or its
designee under clause (iii)(A) below to deliver payments to a Person other than such Person and
to negotiate the terms of any mandatory sale under clause (iii)(B) below and to execute all
instruments of transfer and to do all other things necessary in connection with any such sale.
The rights of each Person acquiring any ownership interest in a Residual Certificate are
expressly subject to the following provisions:
(A) Each Person holding or acquiring any ownership interest in a Residual Certificate shall be
other than a Disqualified Organization and shall promptly notify the Trust Administrator of
any change or impending change in its status as other than a Disqualified Organization.
(B) In connection with any proposed transfer of any ownership interest in a Residual Certificate to
a U.S. Person, the Trust Administrator shall require delivery to it, and shall not register
the transfer of a Residual Certificate until its receipt of (1) an affidavit and agreement
(a "Transferee Affidavit and Agreement" attached hereto as Exhibit N) from the proposed
transferee, in form and substance satisfactory to the Trust Administrator, representing and
warranting, among other things, that it is not a non U.S. Person, that such transferee is
other than a Disqualified Organization, that it is not acquiring its ownership interest in
a Residual Certificate that is the subject of the proposed Transfer as a nominee, trustee
or agent for any Person who is not other than a Disqualified Organization, that for so long
as it retains its ownership interest in a Residual Certificate, it shall endeavor to remain
other than a Disqualified Organization, and that it has reviewed the provisions of this
Section 6.02(g) and agrees to be bound by them, and (2) a certificate, attached hereto as
Exhibit O, from the Holder wishing to transfer a Residual Certificate, in form and
substance satisfactory to the Trust Administrator, representing and warranting, among other
things, that no purpose of the proposed transfer is to allow such Holder to impede the
assessment or collection of tax.
(C) Notwithstanding the delivery of a Transferee Affidavit and Agreement by a proposed transferee
under clause (B) above, if the Trust Administrator has actual knowledge that the proposed
transferee is not other than a Disqualified Organization, no transfer of an ownership
interest in a Residual Certificate to such proposed transferee shall be effected.
(D) Each Person holding or acquiring any ownership interest in a Residual Certificate agrees, by
holding or acquiring such ownership interest, to require a Transferee Affidavit and
Agreement from the other Person to whom such Person attempts to transfer its ownership
interest and to provide a certificate to the Trust Administrator in the form attached
hereto as Exhibit O.
(ii) The Trust Administrator shall register the transfer of any Residual Certificate only if it
shall have received the Transferee Affidavit and Agreement, a certificate of the Holder
requesting such transfer in the form attached hereto as Exhibit O and all of such other
documents as shall have been reasonably required by the Trust Administrator as a condition to
such registration.
(iii) (A) If any Disqualified Organization shall become a Holder of a Residual Certificate, then the
last preceding Holder that was other than a Disqualified Organization shall be restored, to
the extent permitted by law, to all rights and obligations as Holder thereof retroactive to
the date of registration of such transfer of such Residual Certificate. If any non
U.S. Person shall become a Holder of a Residual Certificate, then the last preceding Holder
that is a U.S. Person shall be restored, to the extent permitted by law, to all rights and
obligations as Holder thereof retroactive to the date of registration of the transfer to
such non U.S. Person of such Residual Certificate. If a transfer of a Residual Certificate
is disregarded pursuant to the provisions of Treasury Regulations Section 1.860E-1 or
Section 1.860G-3, then the last preceding Holder that was other than a Disqualified
Organization shall be restored, to the extent permitted by law, to all rights and
obligations as Holder thereof retroactive to the date of registration of such transfer of
such Residual Certificate. The Trust Administrator shall be under no liability to any
Person for any registration of transfer of a Residual Certificate that is in fact not
permitted by this Section 6.02(g) or for making any payments due on such Certificate to the
Holder thereof or for taking any other action with respect to such Holder under the
provisions of this Agreement.
(B) If any purported transferee of a Residual Certificate shall
become a Holder of a Residual Certificate in violation of the restrictions in this
Section 6.02(g) and to the extent that the retroactive restoration of the rights of the
Holder of such Residual Certificate as described in clause (iii)(A) above shall be invalid,
illegal or unenforceable, then the Depositor shall have the right, without notice to the
Holder or any prior Holder of such Residual Certificate, to sell such Residual Certificate
to a purchaser selected by the Depositor on such terms as the Depositor may choose. Such
purported transferee shall promptly endorse and deliver a Residual Certificate in
accordance with the instructions of the Depositor. Such purchaser may be the Depositor
itself or any affiliate of the Depositor. The proceeds of such sale, net of the
commissions (which may include commissions payable to the Depositor or its affiliates),
expenses and taxes due, if any, shall be remitted by the Depositor to such purported
transferee. The terms and conditions of any sale under this clause (iii)(B) shall be
determined in the sole discretion of the Depositor, and the Depositor shall not be liable
to any Person having an ownership interest or a purported ownership interest in a Residual
Certificate as a result of its exercise of such discretion.
(iv) The Master Servicer and each Servicer, on behalf of the Trust Administrator, shall make
available, upon written request from the Trust Administrator, all information reasonably
available to it that is necessary to compute any tax imposed (A) as a result of the transfer of
an ownership interest in a Residual Certificate to any Person who is not other than a
Disqualified Organization, including the information regarding "excess inclusions" of such
Residual Certificate required to be provided to the Internal Revenue Service and certain
Persons as described in Treasury Regulation Section 1.860D 1(b)(5), and (B) as a result of any
regulated investment company, real estate investment trust, common trust fund, partnership,
trust, estate or organizations described in Section 1381 of the Code having as among its record
holders at any time any Person who is not other than a Disqualified Organization. Reasonable
compensation for providing such information may be required by the Master Servicer or the
related Servicer from such Person.
(v) The provisions of this Section 6.02(g) set forth prior to this Section 6.02(g)(v) may be
modified, added to or eliminated by the Depositor, provided that there shall have been
delivered to the Trust Administrator the following:
(A) written notification from each Rating Agency to the effect that the modification, addition to
or elimination of such provisions will not cause such Rating Agency to downgrade its then
current rating of the Certificates; and
(B) a certificate of the Depositor stating that the Depositor has received an Opinion of Counsel,
in form and substance satisfactory to the Depositor, to the effect that such modification,
addition to or elimination of such provisions will not cause the Trust Fund to cease to
qualify as a REMIC and will not create a risk that (i) the Trust Fund may be subject to an
entity level tax caused by the transfer of a Residual Certificate to a Person which is not
other than a Disqualified Organization or (2) a Certificateholder or another Person will be
subject to a REMIC related tax caused by the transfer of applicable Residual Certificate to
a Person which is not other than a Disqualified Organization.
(vi) The following legend shall appear on each Residual Certificate:
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY IF THE
PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE DEPOSITOR AND THE TRUST
ADMINISTRATOR THAT (1) SUCH TRANSFEREE IS NOT (A) THE UNITED STATES, ANY STATE OR
POLITICAL SUBDIVISION THEREOF, ANY FOREIGN GOVERNMENT, ANY INTERNATIONAL ORGANIZATION,
OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF THE FOREGOING, (B) ANY ORGANIZATION (OTHER
THAN A COOPERATIVE DESCRIBED IN SECTION 521 OF THE CODE) WHICH IS EXEMPT FROM THE TAX
IMPOSED BY CHAPTER 1 OF THE CODE UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX
IMPOSED BY SECTION 511 OF THE CODE, (C) ANY ORGANIZATION DESCRIBED IN SECTION
1381(a)(2)(C) OF THE CODE (ANY SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (A),
(B), OR (C) BEING HEREINAFTER REFERRED TO AS A "DISQUALIFIED ORGANIZATION"), OR (D) AN
AGENT OF A DISQUALIFIED ORGANIZATION AND (2) NO PURPOSE OF SUCH TRANSFER IS TO ENABLE
THE TRANSFEROR TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX. SUCH AFFIDAVIT SHALL
INCLUDE CERTAIN REPRESENTATIONS AS TO THE FINANCIAL CONDITION OF THE PROPOSED
TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE REGISTER OF ANY
TRANSFER, SALE OR OTHER DISPOSITION OF THIS CERTIFICATE TO A DISQUALIFIED ORGANIZATION
OR AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH REGISTRATION SHALL BE DEEMED TO BE OF
NO LEGAL FORCE OR EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A
CERTIFICATEHOLDER FOR ANY PURPOSE HEREUNDER, INCLUDING, BUT NOT LIMITED TO, THE
RECEIPT OF DISTRIBUTIONS ON THIS CERTIFICATE. EACH HOLDER OF THIS CERTIFICATE BY
ACCEPTANCE OF THIS CERTIFICATE SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF
THIS PARAGRAPH.
(h) The Trust Administrator shall have no liability to the Trust Fund arising from a transfer of
any such Certificate in reliance upon a certification, ruling or Opinion of Counsel described in this
Section 6.02; provided, however, that the Trust Administrator shall not register the transfer of any
Residual Certificate if it has actual knowledge that the proposed transferee does not meet the
qualifications of a permitted Holder of a Residual Certificate as set forth in this Section 6.02.
(i) Each Holder of a Class 4-A-2 Certificate or any interest therein shall be deemed to have
represented, by its acquisition or holding of such certificate or any interest therein, that as of any
date prior to the termination of the Swap Agreement, at least one of PTCE 84-14, 90-1, 91-38, 95-60 or
96-23 or other applicable exemption applies to such Holder's right to receive payments from the
Supplemental Interest Trust.
SECTION 6.03. Mutilated, Destroyed, Lost or Stolen Certificates.
If (a) any mutilated Certificate is surrendered to the Trust Administrator, or the
Trust Administrator receives evidence to its satisfaction of the destruction, loss or theft of any
Certificate and (b) there is delivered to each Servicer, the Trustee and the Trust Administrator 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 and the Trust Administrator that such Certificate has been acquired by a protected
purchaser, the Trust Administrator shall execute, authenticate and deliver, in exchange for or in lieu
of any such mutilated, destroyed, lost or stolen Certificate, a new Certificate of like tenor and
interest in the Trust Fund. In connection with the issuance of any new Certificate under this
Section 6.03, the Trust Administrator may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any other expenses (including the
fees and expenses of the Trust Administrator) connected therewith. Any replacement Certificate issued
pursuant to this Section 6.03 shall constitute complete and indefeasible evidence of ownership in the
Trust Fund, as if originally issued, whether or not the lost, stolen or destroyed Certificate shall be
found at any time.
SECTION 6.04. Persons Deemed Owners.
Prior to due presentation of a Certificate for registration of transfer, each
Servicer, the Trust Administrator, and any agent of the Master Servicer or any Servicer, the Trust
Administrator 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 none of the Master Servicer or the Servicers, the Trust Administrator, nor any
agent of the Master Servicer or a Servicer or the Trust Administrator shall be affected by any notice to
the contrary.
SECTION 6.05. Access to List of Certificateholders' Names and Addresses.
(a) If three or more Certificateholders (i) request in writing from the Trust Administrator a list
of the names and addresses of Certificateholders, (ii) state that such Certificateholders desire to
communicate with other Certificateholders with respect to their rights under this Agreement or under the
Certificates and (iii) provide a copy of the communication which such Certificateholders propose to
transmit, then the Trust Administrator shall, within ten Business Days after the receipt of such
request, afford such Certificateholders access during normal business hours to a current list of the
Certificateholders. The expense of providing any such information requested by a Certificateholder
shall be borne by the Certificateholders requesting such information and shall not be borne by the Trust
Administrator or the Trustee. Every Certificateholder, by receiving and holding a Certificate, agrees
that the Trustee and the Trust Administrator shall not be held accountable by reason of the disclosure
of any such information as to the list of the Certificateholders hereunder, regardless of the source
from which such information was derived.
(b) The Master Servicer and each Servicer, so long as it is a servicer hereunder, DLJMC and the
Depositor shall have unlimited access to a list of the names and addresses of the Certificateholders
which list shall be provided by the Trust Administrator promptly upon request.
SECTION 6.06. Maintenance of Office or Agency.
The Trust Administrator shall maintain or cause to be maintained at its expense an
office or offices or agency or agencies in Minneapolis, Minnesota where Certificates may be surrendered
for registration of transfer or exchange and where notices and demands to or upon the Trust
Administrator in respect of the Certificates and this Agreement may be served. The Trust Administrator
initially designates its Corporate Trust Office as its office for such purpose. The Trust Administrator
shall give prompt written notice to the Certificateholders of any change in the location of any such
office or agency.
SECTION 6.07. Book Entry Certificates.
Notwithstanding the foregoing, the Book-Entry Certificates, upon original issuance,
shall be issued in the form of one or more typewritten Certificates representing the Book-Entry
Certificates, to be delivered to DTC, the initial Clearing Agency, by, or on behalf of, the Depositor.
The Book-Entry Certificates shall initially be registered on the Certificate Register in the name of
Cede & Co., the nominee of DTC, as the initial Clearing Agency, and no Beneficial Holder will receive a
definitive certificate representing such Beneficial Holder's interest in the Certificates, except as
provided in Section 6.09. Unless and until definitive, fully registered Certificates ("Definitive
Certificates") have been issued to the Beneficial Holders pursuant to Section 6.09:
(a) the provisions of this Section 6.07 shall be in full force and effect with respect to the
Book-Entry Certificates;
(b) the Depositor and the Trust Administrator may deal with the Clearing Agency for all purposes
with respect to the Book-Entry Certificates (including the making of distributions on such Certificates)
as the sole Holder of such Certificates;
(c) to the extent that the provisions of this Section 6.07 conflict with any other provisions of
this Agreement, the provisions of this Section 6.07 shall control; and
(d) the rights of the Beneficial Holders of the Book-Entry Certificates shall be exercised only
through the Clearing Agency and the Participants and shall be limited to those established by law and
agreements between such Beneficial Holders and the Clearing Agency and/or the Participants. Pursuant to
the Depository Agreement, unless and until Definitive Certificates are issued pursuant to Section 6.09,
the initial Clearing Agency will make book-entry transfers among the Participants and receive and
transmit distributions of principal and interest on the related Book-Entry Certificates to such
Participants.
For purposes of any provision of this Agreement requiring or permitting actions with
the consent of, or at the direction of, Holders of the Book-Entry Certificates evidencing a specified
percentage of the aggregate unpaid principal amount of such Certificates, such direction or consent may
be given by the Clearing Agency at the direction of Beneficial Holders owning such Certificates
evidencing the requisite percentage of principal amount of such Certificates. The Clearing Agency may
take conflicting actions with respect to the Book-Entry Certificates to the extent that such actions are
taken on behalf of the Beneficial Holders.
SECTION 6.08. Notices to Clearing Agency.
Whenever notice or other communication to the Holders of Book-Entry Certificates is
required under this Agreement, unless and until Definitive Certificates shall have been issued to the
related Certificateholders pursuant to Section 6.09, the Trust Administrator shall give all such notices
and communications specified herein to be given to Holders of the Book-Entry Certificates to the
Clearing Agency which shall give such notices and communications to the related Participants in
accordance with its applicable rules, regulations and procedures.
SECTION 6.09. Definitive Certificates.
If (a) the Depositor advises the Trust Administrator in writing that the Clearing
Agency is no longer willing or able to properly discharge its responsibilities under the Depository
Agreement with respect to the Certificates and the Trust Administrator or the Depositor is unable to
locate a qualified successor, (b) the Depositor, with the consent of the applicable Participants,
advises the Trust Administrator in writing that it elects to terminate the book-entry system with
respect to the Book-Entry Certificates through the Clearing Agency or (c) after the occurrence of an
Event of Default, Holders of Book-Entry Certificates evidencing not less than 66-2/3% of the aggregate
Class Principal Balance of the Book-Entry Certificates advise the Trust Administrator in writing that
the continuation of a book-entry system with respect to the such Certificates through the Clearing
Agency is no longer in the best interests of the Holders of such Certificates with respect to the
Book-Entry Certificates and the applicable Participants consent, the Trust Administrator shall notify all
Holders of such Certificates of the occurrence of any such event and the availability of Definitive
Certificates. Upon surrender to the Trust Administrator of such Certificates by the Clearing Agency,
accompanied by registration instructions from the Clearing Agency for registration, the Trust
Administrator shall authenticate and deliver the Definitive Certificates. Neither the Depositor nor the
Trust Administrator shall be liable for any delay in delivery of such instructions and may conclusively
rely on, and shall be protected in relying on, such instructions. Upon the issuance of Definitive
Certificates all references herein to obligations imposed upon or to be performed by the Clearing Agency
shall be deemed to be imposed upon and performed by the Trust Administrator, to the extent applicable
with respect to such Definitive Certificates, and the Trust Administrator shall recognize the Holders of
Definitive Certificates as Certificateholders hereunder.
ARTICLE VII
THE DEPOSITOR, THE SELLER, THE MASTER
SERVICER, THE SERVICERS AND THE SPECIAL SERVICER
SECTION 7.01. Liabilities of the Seller, the Depositor, the Master Servicer, the Servicers and the
Special Servicer.
The Depositor, the Seller, the Master Servicer, each Servicer and the Special Servicer
shall be liable under this Agreement to any other party to this Agreement, including the liability of
each Servicer to the Master Servicer in accordance herewith only to the extent of the obligations
specifically and respectively imposed upon and undertaken by them herein.
SECTION 7.02. Merger or Consolidation of the Seller, the Depositor, the Master Servicer, the
Servicers or the Special Servicer.
Subject to the immediately succeeding paragraph, the Depositor, the Seller, the Master
Servicer, each Servicer and the Special Servicer shall each do or cause to be done all things necessary
to preserve and keep in full force and effect its existence, rights and franchises (charter and
statutory) and shall each 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 respective duties
under this Agreement.
Any Person into which the Depositor, the Seller, the Master Servicer, any Servicer or
the Special Servicer may be merged or consolidated, or any Person resulting from any merger or
consolidation to which the Depositor, the Seller, the Master Servicer, any Servicer or the Special
Servicer shall be a party, or any Person succeeding to the business of the Depositor, the Seller or any
Servicer, shall be the successor of the Depositor, the Seller or such 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, any such Servicer or the Special Servicer shall be qualified
to sell mortgage loans to, and to service mortgage loans on behalf of, FNMA or FHLMC.
Notwithstanding anything else in this Section 7.02 or in Section 7.04 hereof to the
contrary, the Master Servicer or a Servicer may assign its rights and delegate its duties and
obligations under this Agreement; provided, however, that the Master Servicer or such Servicer gives the
Depositor, the Trustee and the Trust Administrator notice of such assignment; provided, further,
(a) that such purchaser or transferee accepting such assignment and delegation shall be an institution
that 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 (b) such purchaser or transferee
executes and delivers to the Depositor, the Trustee and the Trust Administrator 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 or such Servicer, with like
effect as if originally named as a party to this Agreement; provided, further, that each of the Rating
Agencies acknowledge that its rating of the Certificates in effect immediately prior to such assignment
will not be qualified or reduced as a result of such assignment and delegation. In the case of any such
assignment and delegation, the Master Servicer or such Servicer shall be released from its obligations
under this Agreement (except as provided above), except that the Master Servicer or the related Servicer
shall remain liable for all liabilities and obligations incurred by it as the Master Servicer or
Servicer hereunder prior to the satisfaction of the conditions to such assignment and delegation set
forth in the preceding sentence.
SECTION 7.03. Limitation on Liability of the Seller, the Depositor, the Master Servicer, the
Servicers, the Special Servicer and Others.
None of the Depositor, the Master Servicer, any Servicer, the Seller, the Special
Servicer, nor any of the directors, officers, employees or agents of the Depositor, the Master Servicer,
any Servicer, the Seller or the Special Servicer 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 Servicer, the Seller or the Special Servicer against any breach of
representations or warranties made by it herein or protect the Depositor, the Master Servicer, any
Servicer, the Seller or the Special Servicer or any such director, officer, employee or agent 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, any Servicer, the Seller and the Special Servicer and
any director, officer, employee or agent of the Depositor, the Master Servicer, any Servicer, the Seller
or the Special Servicer may rely in good faith on any document of any kind prima facie properly executed
and submitted by any Person respecting any matters arising hereunder. The Depositor, the Master
Servicer, any Servicer, the Seller and the Special Servicer and any director, officer, employee or agent
of the Depositor, the Master Servicer, any Servicer, the Seller or the Special Servicer shall be
indemnified by the Trust Fund and held harmless against any loss, liability or expense incurred in
connection with any legal action relating to this Agreement or the Certificates, other than 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, any Servicer, the Seller or the Special Servicer shall be
under any obligation to appear in, prosecute or defend any legal action that is not incidental to their
respective duties hereunder and which in its opinion may involve it in any expense or liability;
provided, however, that the Depositor, the Master Servicer, any Servicer, the Seller or the Special
Servicer 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,
the Trust Administrator and the Certificateholders hereunder; provided, however, that in the event the
related Servicer agrees, at the request of the Seller, to act on behalf of the Seller in any dispute or
litigation that is not incidental to such Xxxxxxxx's duties hereunder and that relates to the
origination of a Mortgage Loan, the Seller shall pay all expenses associated with the management and
defense of such claim. Anything in this Agreement to the contrary notwithstanding, in no event shall
the Master Servicer, any Servicer or the Special Servicer be liable for special, indirect or
consequential loss or damage of any kind whatsoever (including but not limited to lost profits), even if
the Master Servicer, the related Servicer or the Special Servicer has been advised of the likelihood of
such loss or damage and regardless of the form of action.
SECTION 7.04. Master Servicer and Servicer Not to Resign; Transfer of Servicing.
(a) Neither the Master Servicer nor any Servicer shall resign from the obligations and duties
hereby imposed on it except (i) upon appointment of a successor master servicer or successor servicer
and receipt by the Trustee and the Trust Administrator of a letter from each Rating Agency that such a
resignation and appointment will not result in a downgrading of the rating of any of the Certificates
related to the applicable Mortgage Loans, or (ii) upon determination that its duties hereunder are no
longer permissible under applicable law. Any such determination under clause (ii) permitting the
resignation of the Master Servicer or a Servicer shall be evidenced by an Opinion of Counsel to such
effect delivered to the Trustee and the Trust Administrator. No such resignation shall become effective
until the successor master servicer or successor servicer shall have assumed the Master Servicer or such
Servicer's, as applicable, responsibilities, duties, liabilities and obligations hereunder in accordance
with Section 8.02 hereof.
(b) Notwithstanding the foregoing, at DLJMC's request, so long as it is the owner of the related
servicing rights, the Master Servicer or SPS shall resign, upon the selection and appointment of a
successor master servicer or servicer, as applicable; provided that DLJMC delivers to the Trustee and
the Trust Administrator the letter required in Section 7.04(a)(i) above. Notwithstanding the foregoing,
in the event that the Master Servicer is appointed as the successor servicer to SPS, the requirements of
Section 7.04(a)(i) shall be waived. In connection with the foregoing, unless otherwise directed by
DLJMC in writing on or prior to the first day of the second month following the Closing Date, DLJMC
hereby directs SPS to resign as Servicer hereunder and appoints the Master Servicer to service the SPS
Serviced Mortgage Loans, effective as of the first day of the third month following the Closing Date.
In connection with its resignation, SPS hereby agrees to deliver to the Master Servicer on the date of
its resignation a schedule setting forth all of the SPS Mortgage Loans as of such date. The Master
Servicer agrees that, as of the first day of the third month following the Closing Date, it shall
service the SPS Serviced Mortgage Loans, and that such loans shall constitute Xxxxx Fargo Serviced
Mortgage Loans, in accordance with the terms of this Agreement. If the Master Servicer resigns pursuant
to this Section 7.04(b), DLJMC shall pay the Master Servicer an amount equal to the product of (a) the
Stated Principal Balance of all of the Mortgage Loans then outstanding and (b) 0.02%.
(c) Notwithstanding the foregoing, if the Trust Administrator shall for any reason no longer be
Trust Administrator hereunder, at DLJMC's request, the Master Servicer shall resign, upon the selection
and appointment of a successor master servicer; provided that DLJMC delivers to the Trustee and the
Trust Administrator the letter required in Section 7.04(a)(i) above.
(d) Notwithstanding the foregoing, at DLJMC's request, the Special Servicer shall resign, upon the
selection and appointment of a successor special servicer by DLJMC; provided that DLJMC delivers to the
Trustee and the Trust Administrator the letter required in Section 7.04(a)(i) above.
SECTION 7.05. Master Servicer, Seller and Servicers May Own Certificates.
Each of the Master Servicer, the Seller, the Special Servicer and each Servicer 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 Master Servicer, the Seller, the Special Servicer or a Servicer.
ARTICLE VIII
DEFAULT
SECTION 8.01. Events of Default.
"Event of Default," wherever used herein, and as to the Master Servicer or any
Servicer, means any one of the following events (whatever reason for such Event of Default and whether
it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any administrative or governmental
body):
(a) any failure by the Master Servicer or a Servicer to remit to the Certificateholders or to the
Trust Administrator any payment other than an Advance required to be made by the Master Servicer or such
Servicer under the terms of this Agreement, which failure shall continue unremedied for a period of
(i) with respect to the Master Servicer or a Servicer other than Xxxxx Fargo, one Business Day and
(ii) with respect to Xxxxx Fargo, two Business Days, after the date upon which written notice of such
failure shall have been given to the Master Servicer or such Servicer by the Trust Administrator or the
Depositor or to the Master Servicer or the related Servicer and the Trust Administrator by the Holders
of Certificates having not less than 25% of the Voting Rights evidenced by the Certificates; or
(b) any failure by the Master Servicer or a Servicer to observe or perform in any material respect
any other of the covenants or agreements on the part of the Master Servicer or a Servicer contained in
this Agreement (except as set forth in (c) and (g) below) which failure (i) materially affects the
rights of the Certificateholders and (ii) shall continue 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 or such
Servicer by the Trust Administrator or the Depositor, or to the Master Servicer or a Servicer and the
Trust Administrator by the Holders of Certificates evidencing not less than 25% of the Voting Rights
evidenced by the Certificates; or
(c) if a representation or warranty set forth in Section 2.03 hereof made solely in its capacity as
the Master Servicer or a Servicer shall prove to be materially incorrect as of the time made in any
respect that materially and adversely affects interests of the Certificateholders, and the circumstances
or condition in respect of which such representation or warranty was incorrect shall not have been
eliminated or cured within 90 days after the date on which written notice thereof shall have been given
to the Master Servicer or the related Servicer by the Trust Administrator for the benefit of the
Certificateholders or by the Depositor; or
(d) a decree or order of a court or agency or supervisory authority having jurisdiction in the
premises for the appointment of a conservator or 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 or a Servicer and such
decree or order shall have remained in force undischarged or unstayed for a period of 60 days; or
(e) the Master Servicer or a Servicer shall consent to the appointment of a conservator or 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 such Servicer or all or substantially all of the
property of the Master Servicer or such Servicer; or
(f) the Master Servicer or a 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
(g) any failure of the Master Servicer or a Servicer to make any Advance in the manner and at the
time required to be made from its own funds pursuant to Section 5.01 of this Agreement and after receipt
of written notice from the Trust Administrator of such failure, which failure continues unremedied
(i) with respect to the Master Servicer or a Servicer, other than Xxxxx Fargo (in its capacity as a
Servicer), after 2:00 p.m., New York City time, on the Business Day immediately following the Master
Servicer's or such Servicer's receipt of such notice and (ii) with respect to Xxxxx Fargo (in its
capacity as a Servicer), on the second Business Day immediately following Xxxxx Fargo's receipt of such
notice; or
(h) (a) the servicer rankings or ratings for a Servicer are downgraded to "below average" status by
one or more of the Rating Agencies rating the Certificates or (b) one or more Classes of the
Certificates are downgraded or placed on negative watch due in whole or in part to the performance or
servicing of a Servicer; or
(i) the servicer rankings or ratings for a Servicer are downgraded two or more levels below the
level in effect on the Closing Date by one or more of the Rating Agencies rating the Certificates; or
(j) (a) either (i) the master servicer rankings or ratings for the Master Servicer are downgraded
two or more levels below the level in effect on the Closing Date by one or more of the Rating Agencies
rating the Certificates or (ii) the Master Servicer rankings or ratings for the Master Servicer, are
downgraded to "below average" status by one or more of the Rating Agencies rating the Certificates or
(b) one or more Classes of the Certificates are downgraded or placed on negative watch due in whole or in
part to the performance or master servicing of the Master Servicer;
(k) any failure by an applicable Servicer to (a) remit payment of an Assigned Prepayment Premium to
the Collection Account or (b) remit funds in the amount equal to an Assigned Prepayment Premium which
the applicable Servicer has failed to collect, in each case as required pursuant to this Agreement,
which failure continues unremedied for a period of one Business Day after the date upon which written
notice of such failure, requiring the same to be remedied, shall have been given to the Servicer by the
Trust Administrator, the Master Servicer, the Trustee or the Depositor; or
(l) Any failure by the Master Servicer or a Servicer to comply with the provisions of Article XIII.
If an Event of Default due to the actions or inaction of the Master Servicer or a
Servicer described in clauses (a) through (f) and (l) of this Section 8.01 shall occur, then, and in
each and every such case, so long as such Event of Default shall not have been remedied, (i) the Trust
Administrator shall at the direction of the Trustee or the Holders of Certificates evidencing not less
than 25% of the Voting Rights evidenced by the Certificates, by notice in writing to the Master Servicer
or such Servicer (with a copy to the Rating Agencies), terminate all of the rights and obligations of
the Master Servicer or such Servicer under this Agreement (other than rights to reimbursement for
Advances and Servicing Advances previously made, as provided in Section 3.08) and (ii) the Master
Servicer may, if such Event of Default is due to the actions or inactions of a Servicer, by notice in
writing to such Servicer (with a copy to the Rating Agencies), terminate all of the rights and
obligations of such Servicer under this Agreement (other than rights to reimbursement for Advances and
Xxxxxxxxx Advances previously made, as provided in Section 3.08).
If an Event of Default described in clause (g) shall occur, (i) if the Master Servicer
has failed to make any Advance, the Trustee, and (ii) if any Servicer has failed to make any Advance,
the Master Servicer, shall prior to the next Distribution Date, immediately make such Advance and
terminate the rights and obligations of the Master Servicer or applicable Servicer, as applicable,
hereunder and succeed to the rights and obligations of the Master Servicer or such Servicer, as
applicable, hereunder pursuant to Section 8.02, including the obligation to make Advances on such
succeeding Distribution Date pursuant to the terms hereof. No Event of Default with respect to the
Master Servicer or a Servicer shall affect the rights or duties of any other Servicer or constitute an
Event of Default as to any other Servicer.
If an Event of Default described in clause (h), (i) or (k) occurs, the Master Servicer
shall at the direction of DLJMC, by notice in writing to such Servicer, terminate all of the rights and
obligations of such Servicer under this Agreement (other than rights to reimbursement for Advances and
Servicing Advances previously made, as provided in Section 3.08) and shall appoint as successor Servicer
the entity selected by DLJMC in accordance with Section 8.02; provided that DLJMC shall first furnish to
the Master Servicer a letter from each Rating Agency that the appointment of such successor will not
result in a downgrading of the rating of any of the Certificates.
If an Event of Default described in clause (k) occurs, the Trustee shall at the
direction of DLJMC, by notice in writing to the Master Servicer, terminate all of the rights and
obligations of the Master Servicer under this Agreement (other than rights to reimbursement for Advances
previously made, as provided in Section 3.08) and shall appoint as successor Master Servicer the entity
selected by DLJMC in accordance with Section 8.02; provided that DLJMC shall first furnish to the
Trustee a letter from each Rating Agency that the appointment of such successor will not result in a
downgrading of the rating of any of the Certificates.
No Event of Default with respect to the Servicer shall affect the rights or duties of
the Master Servicer or constitute an Event of Default as to the Master Servicer.
SECTION 8.02. Master Servicer or Trust Administrator to Act; Appointment of Successor.
On and after the time the Master Servicer or a Servicer receives a notice of
termination pursuant to Section 8.01 hereof or resigns pursuant to Section 7.04 hereof, subject to the
provisions of Section 3.04 hereof, the Trustee (in the case of the Master Servicer) or the Trust
Administrator shall be the successor in all respects to the Master Servicer or such Servicer, as
applicable, in its capacity as servicer under this Agreement and with respect to 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 or such Servicer, as applicable, by the terms and
provisions hereof; provided, that the Trustee, the Trust Administrator or the Master Servicer, as
applicable, shall not be deemed to have made any representation or warranty as to any Mortgage Loan made
by the Master Servicer or any Servicer, as applicable, and shall not effect any repurchases or
substitutions of any Mortgage Loan; provided, further, that it is understood and acknowledged by the
parties hereto that there will be a full period of transition (not to exceed ninety (90) days) before
the actual servicing functions of any Servicer can be fully transferred to Xxxxx Fargo as successor
Servicer; provided, further, that during such period of transition Xxxxx Fargo, as successor Servicer,
shall continue to make all required Compensating Interest Payments and Advances. As compensation
therefor, the Trustee, the Trust Administrator or the Master Servicer, as applicable, shall be entitled
to all funds relating to the Mortgage Loans that the Master Servicer or related Servicer (the "Replaced
Servicer") would have been entitled to charge to the related Collection Account if the Replaced Servicer
had continued to act hereunder (except that the Replaced Servicer shall retain the right to be
reimbursed for advances (including, without limitation, Advances and Servicing Advances) theretofore
made by the Replaced Servicer with respect to which it would be entitled to be reimbursed as provided in
Section 3.08 if it had not been so terminated or resigned). Notwithstanding the foregoing, if the
Trustee, the Trust Administrator or the Master Servicer, as applicable, has become the successor to a
Replaced Servicer, in accordance with this Section 8.02, the Trustee, the Trust Administrator or the
Master Servicer, as applicable, may, if it shall be unwilling to so act, or shall, if it is 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, as the successor to the Master Servicer or a Servicer, as applicable, hereunder in the
assumption of all or any part of the responsibilities, duties or liabilities of the Master Servicer or
such Servicer, as applicable, provided that such successor to the Master Servicer or the Servicer, as
applicable, shall not be deemed to have made any representation or warranty as to any Mortgage Loan made
by the Master Servicer or the related Servicer, as applicable. Pending appointment of a successor to
the Master Servicer or a Servicer, as applicable, hereunder, the Trustee, the Trust Administrator or the
Master Servicer, as applicable, unless such party is prohibited by law from so acting, shall act in such
capacity as provided herein. In connection with such appointment and assumption, the Trustee, the Trust
Administrator or the Master Servicer, as applicable, 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 that permitted the Replaced Servicer,
hereunder. The Trustee, the Trust Administrator or the Master Servicer, as applicable, and such
successor shall take such action, consistent with this Agreement, as shall be necessary to effectuate
any such succession. None of the Trustee, the Trust Administrator, the Master Servicer nor any other
successor 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 caused by the failure of a Replaced
Servicer to deliver, or any delay in delivering, cash, documents or records to it.
A Replaced Servicer that has been terminated shall, at the request of the Trustee, the
Trust Administrator or the Master Servicer, as applicable, but at the expense of such Replaced Servicer
deliver to the assuming party all documents and records relating to the applicable Mortgage Loans and an
accounting of amounts collected and held by it and otherwise use commercially reasonable efforts to
effect the orderly and efficient transfer and assignment of such servicing, but only to the extent of
the Mortgage Loans serviced thereunder, to the assuming party. Notwithstanding anything to the contrary
contained herein, the termination of a Servicer under this Agreement shall not extend to any
Sub-Servicer meeting the requirements of Section 3.02(a) and otherwise servicing the related Mortgage
Loans in accordance with the servicing provisions of this Agreement.
The Master Servicer and each Servicer shall cooperate with the Trustee and the Trust
Administrator and any successor servicer in effecting the termination of a Replaced Servicer's
responsibilities and rights hereunder, including without limitation, the transfer to such successor for
administration by it of all cash amounts which shall at the time be credited by such Servicer to the
applicable Collection Account or thereafter received with respect to the Mortgage Loans.
None of the Trustee, the Trust Administrator nor any other successor 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 caused by (a) the failure of the Master Servicer or any
Servicer to (i) deliver, or any delay in delivering, cash, documents or records to it, or (ii) cooperate
as required by this Agreement, or (b) restrictions imposed by any regulatory authority having
jurisdiction over the Master Servicer or the related Servicer.
Any successor to a Servicer as servicer shall during the term of its service as
servicer maintain in force the policy or policies that such Servicer is required to maintain pursuant to
Section 3.09(b) hereof.
If a Servicer that has been terminated fails to pay all costs related to the
transition of servicing to the successor Servicer, the successor Servicer shall be entitled to
reimbursement of those amounts from the Trust.
In connection with the termination or resignation of a Servicer hereunder, either
(i) the successor Servicer, including the Trust Administrator or Master Servicer if either of such
parties is acting as successor Servicer, shall represent and warrant that it or an affiliate is a member
of MERS in good standing and shall agree to comply in all material respects with the rules and
procedures of MERS in connection with the servicing of the related Mortgage Loans that are registered
with MERS, or (ii) the Replaced Servicer, at its sole expense, shall cooperate with the successor
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® System to the successor Servicer or (y) in causing
MERS to designate on the MERS® System the successor Servicer as the servicer of such Mortgage Loan (at
the cost and expense of the successor Servicer to the extent such costs relate to the qualification of
such successor Servicer as a member of MERS, otherwise at the cost and expense of the Replaced
Servicer). The Replaced Servicer shall file or cause to be filed any such assignment in the appropriate
recording office. The successor 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 8.03. Notification to Certificateholders.
(a) Upon any termination or appointment of a successor to the Master Servicer or any Servicer, the
Trust Administrator shall give prompt written notice thereof to the Seller and the Certificateholders at
their respective addresses appearing in the Certificate Register and to the Rating Agencies, or, as
applicable, the Master Servicer shall give prompt written notice thereof to the Trust Administrator.
(b) Within two Business Days after the occurrence of any Event of Default, the Trust Administrator
shall transmit by mail to the Seller and all Certificateholders, and the Rating Agencies notice of each
such Event of Default hereunder known to the Trust Administrator, unless such Event of Default shall
have been cured or waived.
SECTION 8.04. Waiver of Events of Default.
The Holders representing at least 66% of the Voting Rights of Certificates affected by
a default or Event of Default hereunder may waive any default or Event of Default; provided, however,
that (a) a default or Event of Default under clause (g) of Section 8.01 may be waived, only by all of
the Holders of Certificates affected by such default or Event of Default and (b) no waiver pursuant to
this Section 8.04 shall affect the Holders of Certificates in the manner set forth in
Section 12.01(b)(i), (ii) or (iii). Upon any such waiver of a default or Event of Default by the Holders
representing the requisite percentage of Voting Rights of Certificates affected by such default or Event
of Default, such default or Event of Default shall cease to exist and shall be deemed to have been cured
and remedied for every purpose hereunder. No such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent thereon except to the extent expressly so
waived.
ARTICLE IX
CONCERNING THE TRUSTEE
SECTION 9.01. Duties of Trustee.
The Trustee, prior to the occurrence of an Event of Default and after the curing or
waiver of all Events of Default that may have occurred, undertakes with respect to the Trust Fund to
perform such duties and only such duties as are specifically set forth in this Agreement. In case an
Event of Default of which a Responsible Officer of the Trustee shall have actual knowledge 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. Any permissive
right of the Trustee set forth in this Agreement shall not be construed as a duty.
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
conform to the requirements of this Agreement. The Trustee shall have no duty to recompute, recalculate
or verify the accuracy of any resolution, certificate, statement, opinion, report, document, order or
other instrument so furnished to the Trustee. If any such instrument is found not to conform in any
material respect to the requirements of this Agreement, the Trustee shall notify the Certificateholders
of such instrument in the event that the Trustee, after so requesting, does not receive a satisfactorily
corrected 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 misconduct, its
negligent failure to perform its obligations in compliance with this Agreement, or any liability which
would be imposed by reason of its willful misfeasance or bad faith; provided, however, that:
(a) prior to the occurrence of an Event of Default of which a Responsible Officer of the Trustee
shall have actual knowledge, and after the curing or of all such Events of Default that may have
occurred, the duties and obligations of the Trustee shall be determined solely by the express provisions
of this Agreement, the Trustee shall not be personally 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
reasonably believed in good faith to be genuine and to have been duly executed by the proper authorities
respecting any matters arising hereunder;
(b) the Trustee shall not be personally liable for an error of judgment made in good faith by a
Responsible Officer or Responsible Officers of the Trustee, unless the Trustee was negligent in
ascertaining or investigating the pertinent facts;
(c) the Trustee shall not be personally liable with respect to any action taken, suffered or
omitted to be taken by it in good faith in accordance with this Agreement at the direction of the
Holders of Certificates evidencing greater than 50% of the Voting Rights allocated to each Class 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;
(d) no provision of this Agreement shall require the Trustee to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties hereunder or in the
exercise of any of its rights or powers if it shall have reasonable grounds for believing that repayment
of such funds or adequate indemnity against such risk or liability is not reasonably assured to it; and
(e) the Trustee shall have no responsibility for any act or omission of the Trust Administrator or
a Custodian, it being understood and agreed that the Trustee, Trust Administrator and any Custodian are
independent contractors and not agents, partners or joint venturers.
The Trustee shall not be deemed to have knowledge of any Event of Default or event
which, with notice or lapse of time, or both, would become an Event of Default, unless a Responsible
Officer of the Trustee shall have received written notice thereof from a Servicer, the Depositor or a
Certificateholder, or a Responsible Officer of the Trustee has actual notice thereof, and in the absence
of such notice no provision hereof requiring the taking of any action or the assumption of any duties or
responsibility by the Trustee following the occurrence of any Event of Default or event which, with
notice or lapse of time or both, would become an Event of Default, shall be effective as to the Trustee.
The Trustee shall have no duty hereunder with respect to any complaint, claim, demand,
notice or other document it may receive or which may be alleged to have been delivered to or served upon
it by the parties as a consequence of the assignment of any Mortgage Loan hereunder; provided, however,
that the Trustee shall use its best efforts to remit to the Master Servicer or the related Servicer upon
receipt of any such complaint, claim, demand, notice or other document (i) which is delivered to the
Corporate Trust Office of the Trustee, (ii) of which a Responsible Officer has actual knowledge, and
(iii) which contains information sufficient to permit the Trustee to make a determination that the real
property to which such document relates is a Mortgaged Property.
SECTION 9.02. Certain Matters Affecting the Trustee.
(a) Except as otherwise provided in Section 9.01:
(i) the Trustee may request and rely upon and shall be protected in acting or refraining from
acting upon any resolution, Officer's Certificate, certificate of auditors, Servicing Officers
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;
(ii) the Trustee may consult with counsel, financial advisors or accountants and any advice of such
Persons or 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 advice or Opinion of Counsel;
(iii) the Trustee shall be under no obligation to exercise any of the trusts 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 against the costs, expenses and liabilities which may be
incurred therein or thereby; nothing contained herein shall, however, relieve the Trustee of
the obligation, upon the occurrence of an Event of Default of which a Responsible Officer of
the Trustee shall have actual knowledge (which has not been cured or waived), to exercise such
of the rights and powers vested in it by this Agreement, and to 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;
(iv) the Trustee shall not be personally 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;
(v) prior to the occurrence of an Event of Default hereunder and after the curing or waiver of all
Events of Default that may have occurred, 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 greater
than 50% of the Voting Rights allocated to each Class of Certificates; provided, however, that
if the payment within a reasonable time to the Trustee of the costs, expenses or liabilities
likely to be incurred by it in the making of such investigation is, in the opinion of the
Trustee, not reasonably assured to the Trustee by the security afforded to it by the terms of
this Agreement, the Trustee may require reasonable indemnity against such expense or liability
as a condition to taking any such action; the reasonable expense of every such investigation
shall be paid (A) by the Master Servicer or by the applicable Servicer in the event that such
investigation relates to an Event of Default by the Master Servicer or by such Servicer,
respectively, if an Event of Default by the Master Servicer or by such Servicer shall have
occurred and is continuing, and (B) otherwise by the Certificateholders requesting the
investigation;
(vi) the Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder
either directly or by or through agents or attorneys and the Trustee shall not be responsible
for any misconduct or negligence on the part of any such agent or attorney appointed with due
care;
(vii) the Trustee shall not be required to expend its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder if it shall have reasonable grounds
for believing that repayment of such funds or adequate indemnity against such liability is not
assured to it;
(viii) the Trustee shall not be liable for any loss on any investment of funds pursuant to this
Agreement; and
(ix) the right of the Trustee to perform any discretionary act enumerated in this Agreement shall
not be construed as a duty, and the Trustee shall not be answerable for other than its
negligence or willful misconduct in the performance of such act.
(b) All rights of action under this Agreement or under any of the Certificates, enforceable by the
Trustee, may be enforced by it without the possession of any of the Certificates, or the production
thereof at the trial or other proceeding relating thereto, and any such suit, action or proceeding
instituted by the Trustee shall be brought in its name for the benefit of all the Holders of such
Certificates, subject to the provisions of this Agreement.
SECTION 9.03. Trustee Not Liable for Certificates or Mortgage Loans.
The recitals contained herein shall be taken as the statements of the Depositor or the
Master Servicer or a Servicer, 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,
the Certificates or of any Mortgage Loan or related document or of MERS or the MERS® System. The
Trustee shall not be accountable for the use or application by the Depositor, the Seller, the Master
Servicer or any Servicers of any funds paid to the Depositor or the Master Servicer or any Servicer in
respect of the Mortgage Loans or deposited in or withdrawn from the Certificate Account by the
Depositor, the Seller, the Master Servicer or the Servicers. The Trustee shall not be responsible for
the legality or validity of this Agreement or the validity, priority, perfection or sufficiency of the
security for the Certificates issued or intended to be issued hereunder. The Trustee shall have no
responsibility for filing any financing or continuation statement in any public office at any time or to
otherwise perfect or maintain the perfection of any security interest or lien granted to it hereunder or
to record this Agreement.
SECTION 9.04. Trustee May Own Certificates.
The Trustee in its individual or any other capacity may become the owner or pledgee of
Certificates and may transact business with the other parties hereto and with their Affiliates, with the
same rights as it would have if it were not the Trustee.
SECTION 9.05. Trustee's Fees and Expenses.
The Trustee shall be compensated by the Trust Administrator as separately agreed. The
Trustee and any director, officer, employee or agent of the Trustee shall be indemnified by DLJMC and
held harmless (up to a maximum of $150,000) against any loss, liability or expense (including reasonable
attorney's fees and expenses) (i) incurred in connection with any claim or legal action relating to
(a) this Agreement, (b) the Certificates, or (c) the performance of any of the Trustee's duties
hereunder, other than any loss, liability or expense incurred by reason of willful misconduct, 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 or a Servicer. Such indemnity shall
survive the termination of this Agreement or the resignation or removal of the Trustee hereunder.
Without limiting the foregoing, the Depositor 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 hereunder or for any other expenses.
Anything in this Agreement to the contrary notwithstanding, in no event shall the Trustee be liable for
special, indirect or consequential loss or damage of any kind whatsoever (including but not limited to
lost profits), even if the Trustee has been advised of the likelihood of such loss or damage and
regardless of the form of action.
SECTION 9.06. Eligibility Requirements for Trustee.
The Trustee hereunder shall at all times be a corporation or association organized and
doing business under the laws of any state or the United States of America, authorized under such laws
to exercise corporate trust powers, having ratings on its long term debt obligations at the time of such
appointment in at least the third highest rating category by both Xxxxx'x and S&P (provided that if such
rating is in the third highest rating category of S&P, the Trustee shall also have a short-term rating
from S&P of A-1) or such lower ratings as will not cause Xxxxx'x or S&P to lower their then current
ratings of the Class A Certificates (other than the Class 4-X and Residual Certificates), having a
combined capital and surplus of at least $50,000,000 and subject to supervision or examination by
federal or state authority. If such corporation or association publishes reports of condition at least
annually, pursuant to law or to the requirements of the aforesaid supervising or examining authority,
then for the purposes of this Section 9.06 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 9.06, the Trustee shall resign immediately in the manner
and with the effect specified in Section 9.07 hereof.
SECTION 9.07. Resignation and Removal of Trustee.
The Trustee may at any time resign and be discharged from the trusts hereby created by
(a) giving written notice of resignation to the Depositor, DLJMC, the Trust Administrator, the Master
Servicer, the Special Servicer and the Servicers and by mailing notice of resignation by first class
mail, postage prepaid, to the Certificateholders at their addresses appearing on the Certificate
Register, and to the Rating Agencies, not less than 60 days before the date specified in such notice
when, subject to Section 9.08, such resignation is to take effect, and (b) acceptance by a successor
trustee in accordance with Section 9.08 meeting the qualifications set forth in Section 9.06.
If at any time the Trustee shall cease to be eligible in accordance with the
provisions of Section 9.06 hereof and shall fail to resign after written request thereto by the
Depositor, or if at any time the Trustee shall become incapable of acting, or shall be adjudged a
bankrupt or insolvent, or a receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation or if the Trustee breaches any of its obligations or
representations hereunder, then the Depositor may remove the Trustee and appoint a successor trustee by
written instrument, in duplicate, one copy of which instrument shall be delivered to the Trustee and one
copy to the successor trustee. The Trustee may also be removed at any time by the Holders of
Certificates evidencing not less than 50% of the Voting Rights evidenced by the Certificates. Notice of
any removal of the Trustee and acceptance of appointment by the successor trustee shall be given to the
Rating Agencies by the Depositor.
If no successor trustee shall have been so appointed and have accepted appointment
within 30 days after the giving of such notice of resignation or receipt of a notice of removal, the
resigning Trustee may, at the Trust Fund's expense, petition any court of competent jurisdiction for the
appointment of a successor trustee.
Any resignation or removal of the Trustee and appointment of a successor trustee
pursuant to any of the provisions of this Section 9.07 shall become effective upon acceptance of
appointment by the successor trustee as provided in Section 9.08 hereof.
SECTION 9.08. Successor Trustee.
Any successor trustee appointed as provided in Section 9.07 hereof shall execute,
acknowledge and deliver to the Depositor and to its predecessor trustee 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, upon receipt of all amounts due it
hereunder, 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 9.08 unless
at the time of such acceptance such successor trustee shall be eligible under the provisions of
Section 9.06 hereof and its acceptance shall not adversely affect the then current rating of the
Certificates.
Upon acceptance of appointment by a successor trustee as provided in this
Section 9.08, the Depositor shall mail notice of the succession of such trustee hereunder to all Holders
of Certificates at their addresses as shown in the Certificate Register. If the Depositor fails to mail
such notice within ten 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 9.09. Merger or Consolidation of Trustee.
Any Person into which the Trustee may be merged or converted or with which it may be
consolidated or any Person resulting from any merger, conversion or consolidation to which the Trustee
shall be a party, or any Person succeeding to the business of the Trustee, shall be the successor of the
Trustee hereunder, provided that such Person shall be eligible under the provisions of Section 9.06
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.
SECTION 9.10. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for the purpose
of meeting any legal requirements of any jurisdiction in which any part of the Trust Fund or property
securing any Mortgage Note may at the time be located, the Master Servicer and the Trustee acting
jointly shall have the power and shall execute and deliver all instruments to appoint one or more
Persons approved by the Trustee to act as co-trustee or co-trustees jointly with the Trustee, or
separate trustee or separate trustees, of all or any part of the Trust Fund, and to vest in such Person
or Persons, in such capacity and for the benefit of the applicable Certificateholders, such title to the
Trust Fund, or any part thereof, and, subject to the other provisions of this Section 9.10, 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 fifteen 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 9.06 and no notice to Certificateholders of the appointment of any co-trustee or separate trustee
shall be required under Section 9.08.
Every separate trustee and co-trustee shall, to the extent permitted by law, be
appointed and act subject to the following provisions and conditions:
(a) all rights, powers, duties and obligations conferred or imposed upon the Trustee, except for
any obligation of the Trustee under this Agreement to advance funds on behalf of the Master Servicer or
a 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 by the Trustee
(whether as Trustee hereunder or as successor to the Master Servicer or a Servicer), 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 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;
(b) no trustee hereunder shall be held personally liable by reason of any act or omission of any
other trustee hereunder; and
(c) the Master Servicer and the Trustee acting jointly may at any time accept the resignation of or
remove any 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 then separate trustees and co-trustees, 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 IX. 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 or the
Servicers 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. The Trust Administrator
shall not be responsible for all action or inaction of any separate trustee or co-trustee. If any
separate trustee or co-trustee shall die, become incapable of acting, resign or be removed, all of its
estates, properties, rights, remedies and trusts shall vest in and be exercised by the Trustee, to the
extent permitted by law, without the appointment of a new or successor trustee.
SECTION 9.11. Office of the Trustee.
The office of the Trustee for purposes of receipt of notices and demands is the
Corporate Trust Office.
ARTICLE X
CONCERNING THE TRUST ADMINISTRATOR
SECTION 10.01. Duties of Trust Administrator.
The Trust Administrator, prior to the occurrence of an Event of Default of which a
Responsible Officer of the Trust Administrator shall have actual knowledge and after the curing or
waiver of all Events of Default that may have occurred, undertakes with respect to the Trust Fund to
perform such duties and only such duties as are specifically set forth in this Agreement. In case an
Event of Default of which a Responsible Officer of the Trust Administrator shall have actual knowledge
has occurred and remains uncured, the Trust Administrator 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. Any permissive right of the Trust Administrator set forth in this Agreement shall not be
construed as a duty.
The Trust Administrator, upon receipt of all resolutions, certificates, statements,
opinions, reports, documents, orders or other instruments furnished to the Trust Administrator that are
specifically required to be furnished pursuant to any provision of this Agreement shall examine them to
determine whether they conform to the requirements of this Agreement. The Trust Administrator shall
have no duty to recompute, recalculate or verify the accuracy of any resolution, certificate, statement,
opinion, report, document, order or other instrument so furnished to the Trust Administrator. If any
such instrument is found not to conform in any material respect to the requirements of this Agreement,
the Trust Administrator shall notify the Certificateholders of such instrument in the event that the
Trust Administrator, after so requesting, does not receive a satisfactorily corrected instrument.
No provision of this Agreement shall be construed to relieve the Trust Administrator
from liability for its own negligent action, its own negligent failure to act or its own misconduct, its
negligent failure to perform its obligations in compliance with this Agreement, or any liability which
would be imposed by reason of its willful misfeasance or bad faith; provided, however, that:
(a) prior to the occurrence of an Event of Default of which a Responsible Officer of the Trust
Administrator shall have actual knowledge, and after the curing or of all such Events of Default that
may have occurred, the duties and obligations of the Trust Administrator shall be determined solely by
the express provisions of this Agreement, the Trust Administrator shall not be personally 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 Trust Administrator and
the Trust Administrator 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 Trust Administrator
and conforming to the requirements of this Agreement which it reasonably believed in good faith to be
genuine and to have been duly executed by the proper authorities respecting any matters arising
hereunder;
(b) the Trust Administrator shall not be personally liable for an error of judgment made in good
faith by a Responsible Officer or Responsible Officers of the Trust Administrator, unless the Trust
Administrator was negligent in ascertaining or investigating the pertinent facts;
(c) the Trust Administrator shall not be personally liable with respect to any action taken,
suffered or omitted to be taken by it in good faith in accordance with this Agreement or at the
direction of the Holders of Certificates evidencing greater than 50% of the Voting Rights allocated to
each Class of Certificates relating to the time, method and place of conducting any proceeding for any
remedy available to the Trust Administrator, or exercising any trust or power conferred upon the Trust
Administrator, under this Agreement; and
(d) no provision of this Agreement shall require the Trust Administrator to expend or risk its own
funds or otherwise incur any financial liability in the performance of any of its duties hereunder or in
the exercise of any of its rights or powers if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured
to it.
The Trust Administrator shall have no duty (A) to see to any recording, filing or
depositing of this Agreement or any agreement referred to herein or any financing statement or
continuation statement evidencing a security interest, or to see to the maintenance of any such
recording, filing or depositing or to any rerecording, refiling or redepositing of any thereof, (B) to
see to any insurance, or (C) to see to the payment or discharge of any tax, assessment or other
governmental charge or any lien or encumbrance of any kind owing with respect to, assessed or levied
against, any part of the Trust Fund other than from funds available in the Certificate Account.
Except with respect to an Event of Default described in clause (a) of Section 8.01,
the Trust Administrator shall not be deemed to have knowledge of any Event of Default or event which,
with notice or lapse of time, or both, would become an Event of Default, unless a Responsible Officer of
the Trust Administrator shall have received written notice thereof from the Master Servicer or a
Servicer, the Depositor, or a Certificateholder, or a Responsible Officer of the Trust Administrator has
actual notice thereof, and in the absence of such notice no provision hereof requiring the taking of any
action or the assumption of any duties or responsibility by the Trust Administrator following the
occurrence of any Event of Default or event which, with notice or lapse of time or both, would become an
Event of Default, shall be effective as to the Trust Administrator.
The Trust Administrator shall have no duty hereunder with respect to any complaint,
claim, demand, notice or other document it may receive or which may be alleged to have been delivered to
or served upon it by the parties as a consequence of the assignment of any Mortgage Loan hereunder;
provided, however, that the Trust Administrator shall use its best efforts to remit to the Master
Servicer or the Servicer upon receipt of any such complaint, claim, demand, notice or other document
(i) which is delivered to the Corporate Trust Office of the Trust Administrator, (ii) of which a
Responsible Officer has actual knowledge, and (iii) which contains information sufficient to permit the
Trust Administrator to make a determination that the real property to which such document relates is a
Mortgaged Property.
SECTION 10.02. Certain Matters Affecting the Trust Administrator.
(a) Except as otherwise provided in Section 10.01:
(i) the Trust Administrator may request and rely upon and shall be protected in acting or
refraining from acting upon any resolution, Officer's Certificate, certificate of auditors,
Servicing Officers 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;
(ii) the Trust Administrator may consult with counsel, financial advisors or accountants and any
advice of such Persons or 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 advice or opinion of counsel;
(iii) the Trust Administrator shall be under no obligation to exercise any of the trusts 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
Trust Administrator reasonable security or indemnity against the costs, expenses and
liabilities which may be incurred therein or thereby; nothing contained herein shall, however,
relieve the Trust Administrator of the obligation, upon the occurrence of an Event of Default
of which a Responsible Officer of the Trust Administrator shall have actual knowledge (which
has not been cured or waived), to exercise such of the rights and powers vested in it by this
Agreement, and to 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;
(iv) the Trust Administrator shall not be personally 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;
(v) prior to the occurrence of an Event of Default hereunder and after the curing or waiver of all
Events of Default that may have occurred, the Trust Administrator 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 greater
than 50% of the Voting Rights allocated to each Class of Certificates; provided, however, that
if the payment within a reasonable time to the Trust Administrator of the costs, expenses or
liabilities likely to be incurred by it in the making of such investigation is, in the opinion
of the Trust Administrator, not reasonably assured to the Trust Administrator by the security
afforded to it by the terms of this Agreement, the Trust Administrator may require reasonable
indemnity against such expense or liability as a condition to taking any such action; the
reasonable expense of every such investigation shall be paid (A) by the Master Servicer or by
the applicable Servicer in the event that such investigation relates to an Event of Default by
the Master Servicer or by such Servicer, respectively, if an Event of Default by the Master
Servicer or such Servicer shall have occurred and is continuing, and (B) otherwise by the
Certificateholders requesting the investigation;
(vi) the Trust Administrator may execute any of the trusts or powers hereunder or perform any duties
hereunder either directly or by or through agents or attorneys and the Trust Administrator
shall not be responsible for any misconduct or negligence on the part of any such agent or
attorney appointed with due care;
(vii) the Trust Administrator shall not be required to expend its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder if it shall have
reasonable grounds for believing that repayment of such funds or adequate indemnity against
such liability is not assured to it;
(viii) the Trust Administrator shall not be liable for any loss on any investment of funds pursuant to
this Agreement except as provided in Section 3.05(e);
(ix) the right of the Trust Administrator to perform any discretionary act enumerated in this
Agreement shall not be construed as a duty, and the Trust Administrator shall not be answerable
for other than its negligence or willful misconduct in the performance of such act; and
(x) The Trust Administrator shall not be required to give any bond or surety in respect of the
execution of the Trust Fund created hereby or the powers granted hereunder.
(b) All rights of action under this Agreement or under any of the Certificates, enforceable by the
Trust Administrator, may be enforced by it without the possession of any of the Certificates, or the
production thereof at the trial or other proceeding relating thereto, and any such suit, action or
proceeding instituted by the Trust Administrator shall be brought in its name for the benefit of all the
Holders of such Certificates, subject to the provisions of this Agreement.
SECTION 10.03. Trust Administrator Not Liable for Certificates or Mortgage Loans.
The recitals contained herein shall be taken as the statements of the Depositor or the
Master Servicer or a Servicer, as the case may be, and the Trust Administrator assumes no responsibility
for their correctness. The Trust Administrator makes no representations as to the validity or
sufficiency of this Agreement, the Certificates or of any Mortgage Loan or related document. The Trust
Administrator shall not be accountable for the use or application by the Depositor, the Seller, the
Master Servicer or the Servicers of any funds paid to the Depositor or the Master Servicer or any
Servicer in respect of the Mortgage Loans or deposited in or withdrawn from the Certificate Account by
the Depositor, the Seller, the Master Servicer or the Servicers. The Trust Administrator shall not be
responsible for the legality or validity of this Agreement or the validity, priority, perfection or
sufficiency of the security for the Certificates issued or intended to be issued hereunder. The Trust
Administrator shall have no responsibility for filing any financing or continuation statement in any
public office at any time or to otherwise perfect or maintain the perfection for any security interest
or lien granted to it hereunder or to record this Agreement.
SECTION 10.04. Trust Administrator May Own Certificates.
The Trust Administrator 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 Trust Administrator.
SECTION 10.05. Trust Administrator's Fees and Expenses.
As compensation for its services hereunder, the Trust Administrator shall be entitled
to the investment income or other benefit derived from balances in the Certificate Account pursuant to
Section 3.05(e) (the "Trust Administrator Fee"). The Trust Administrator and any director, officer,
employee or agent of the Trust Administrator shall be indemnified by DLJMC (or if DLJMC shall fail to do
so, by the Trust) and held harmless against any loss, liability or expense (including reasonable
attorney's fees and expenses) (i) incurred in connection with any claim or legal action relating to
(a) this Agreement, (b) the Certificates, (c) the Custodial Agreement, or (d) the performance of any of
the Trust Administrator's duties hereunder or under the Custodial Agreement, other than any loss,
liability or expense incurred by reason of willful misfeasance, bad faith or negligence in the
performance of any of the Trust Administrator's duties hereunder or incurred by reason of any action of
the Trust Administrator taken at the direction of the Certificateholders and (ii) resulting from any
error in any tax or information return prepared by the Master Servicer or a Servicer; provided, however,
that the sum of (x) such indemnity amounts payable by DLJMC or the Trust to the Trust Administrator
pursuant to this Section 10.05 and (y) the indemnity amounts payable by DLJMC or the Trust to the Master
Servicer pursuant to Section 3.14(c), shall not exceed $200,000 per year; provided, further, that any
amounts not payable by DLJMC or the Trust to the Trust Administrator due to the preceding proviso shall
be payable by DLJMC (or if DLJMC fails to do so, by the Trust) in any succeeding year, subject to the
aggregate $200,000 per annum limitation imposed by the preceding proviso. Such indemnity shall survive
the termination of this Agreement or the resignation or removal of the Trust Administrator hereunder.
Without limiting the foregoing, DLJMC (or if DLJMC fails to do so, the Trust) shall, except as otherwise
agreed upon in writing by DLJMC and the Trust Administrator, and except for any such expense,
disbursement or advance as may arise from the Trust Administrator's negligence, bad faith or willful
misconduct, pay or reimburse the Trust Administrator (up to a maximum of $150,000), for all reasonable
expenses, disbursements and advances incurred or made by the Trust Administrator 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 Trust Administrator, to the extent that the Trust Administrator
must engage such persons to perform acts or services hereunder and (C) printing and engraving expenses
in connection with preparing any Definitive Certificates. In addition, DLJMC (or if DLJMC fails to do
so, the Trust) shall pay or reimburse the Trust Administrator for recertification fees required to be
paid by the Trust Administrator pursuant to the Custodial Agreement. Except as otherwise provided
herein, the Trust Administrator shall not be entitled to payment or reimbursement for any routine
ongoing expenses incurred by the Trust Administrator in the ordinary course of its duties as Trust
Administrator, Registrar, Tax Matters Person or Paying Agent hereunder. Anything in this Agreement to
the contrary notwithstanding, in no event shall the Trust Administrator be liable for special, indirect
or consequential loss or damage of any kind whatsoever (including but not limited to lost profits), even
if the Trust Administrator has been advised of the likelihood of such loss or damage and regardless of
the form of action.
SECTION 10.06. Eligibility Requirements for Trust Administrator.
The Trust Administrator hereunder shall at all times be (a) an institution the
deposits of which are fully insured by the FDIC and (b) a corporation or banking association organized
and doing business under the laws of any 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
and subject to supervision or examination by federal or state authority and (c) with respect to every
successor Trust Administrator hereunder an institution the long-term unsecured debt obligations of which
are rated at least Baa3 or better by Xxxxx'x and BBB or better by S&P unless the failure of the Trust
Administrator's long-term unsecured debt obligations to have such ratings would not result in the
lowering of the ratings originally assigned to any Class of Certificates. If such corporation or
banking association publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the purposes of this
Section 10.06 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 Trust Administrator shall cease to be eligible in accordance with the provisions of
this Section 10.06, the Trust Administrator shall resign immediately in the manner and with the effect
specified in Section 10.07 hereof.
SECTION 10.07. Resignation and Removal of Trust Administrator.
The Trust Administrator may at any time resign and be discharged from the trusts
hereby created by (a) giving written notice of resignation to the Depositor, the Seller, the Trustee,
the Master Servicer, the Special Servicer and the Servicers and by mailing notice of resignation by
first class mail, postage prepaid, to the Certificateholders at their addresses appearing on the
Certificate Register, and to the Rating Agencies, not less than 60 days before the date specified in
such notice when, subject to Section 10.08, such resignation is to take effect, and (b) acceptance by a
successor trust administrator in accordance with Section 10.08 meeting the qualifications set forth in
Section 10.06.
If at any time the Trust Administrator shall cease to be eligible in accordance with
the provisions of Section 10.06 hereof and shall fail to resign after written request thereto by the
Depositor, or if at any time the Trust Administrator shall become incapable of acting, or shall be
adjudged a bankrupt or insolvent, or a receiver of the Trust Administrator or of its property shall be
appointed, or any public officer shall take charge or control of the Trust Administrator or of its
property or affairs for the purpose of rehabilitation, conservation or liquidation or if the Trust
Administrator breaches any of its obligations or representations hereunder, then the Depositor may
remove the Trust Administrator and appoint a successor trust administrator by written instrument, in
duplicate, one copy of which instrument shall be delivered to the Trust Administrator and one copy to
the successor trust administrator. The Trust Administrator may also be removed at any time by the
Trustee or the Holders of Certificates evidencing not less than 50% of the Voting Rights evidenced by
the Certificates. Notice of any removal of the Trust Administrator and acceptance of appointment by the
successor trust administrator shall be given to the Rating Agencies by the Depositor.
If no successor trust administrator shall have been so appointed and have accepted
appointment within 30 days after the giving of such notice of resignation or receipt of a notice of
removal, the resigning Trust Administrator may, at the Trust Fund's expense, petition any court of
competent jurisdiction for the appointment of a successor trust administrator.
Notwithstanding the foregoing, if the Master Servicer shall for any reason no longer
be Master Servicer hereunder, at DLJMC's request, the Trust Administrator shall resign, upon the
selection and appointment of a successor trust administrator meeting the qualifications set forth in
Section 10.06.
Any resignation or removal of the Trust Administrator and appointment of a successor
trust administrator pursuant to any of the provisions of this Section 10.07 shall become effective upon
acceptance of appointment by the successor trust administrator as provided in Section 10.08 hereof.
SECTION 10.08. Successor Trust Administrator.
Any successor trust administrator appointed as provided in Section 10.07 hereof shall
execute, acknowledge and deliver to the Depositor and to its predecessor trust administrator an
instrument accepting such appointment hereunder and thereupon the resignation or removal of the
predecessor trust administrator shall become effective and such successor trust administrator, 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 Trust
Administrator herein. The Depositor, upon receipt of all amounts due it hereunder, and the predecessor
trust administrator 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 trust
administrator all such rights, powers, duties, and obligations.
No successor trust administrator shall accept appointment as provided in this
Section 10.08 unless at the time of such acceptance such successor trust administrator shall be eligible
under the provisions of Section 10.06 hereof and its acceptance shall not adversely affect the then
current rating of the Certificates.
Upon acceptance of appointment by a successor trust administrator as provided in this
Section 10.08, the Depositor shall mail notice of the succession of such trust administrator hereunder
to all Holders of Certificates at their addresses as shown in the Certificate Register. If the
Depositor fails to mail such notice within ten days after acceptance of appointment by the successor
trust administrator, the successor trust administrator shall cause such notice to be mailed at the
expense of the Depositor.
SECTION 10.09. Merger or Consolidation of Trust Administrator.
Any Person into which the Trust Administrator may be merged or converted or with which
it may be consolidated or any Person resulting from any merger, conversion or consolidation to which the
Trust Administrator shall be a party, or any Person succeeding to the business of the Trust
Administrator, shall be the successor of the Trust Administrator hereunder, provided that such Person
shall be eligible under the provisions of Section 10.06 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.
SECTION 10.10. Appointment of Co-Trust Administrator or Separate Trust Administrator.
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 Trust Administrator
acting jointly shall have the power and shall execute and deliver all instruments to appoint one or more
Persons approved by the Trust Administrator to act as co-trust administrator or co-trust administrators
jointly with the Trust Administrator, or separate trust administrator or separate trust administrators,
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 applicable Certificateholders, such title to the Trust Fund, or any part thereof,
and, subject to the other provisions of this Section 10.10, such powers, duties, obligations, rights and
trusts as the Master Servicer and the Trust Administrator may consider necessary or desirable. If the
Master Servicer shall not have joined in such appointment within fifteen 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 Trust
Administrator alone shall have the power to make such appointment. No co-trust administrator or
separate trust administrator hereunder shall be required to meet the terms of eligibility as a successor
trust administrator under Section 10.06 and no notice to Certificateholders of the appointment of any
co-trust administrator or separate trust administrator shall be required under Section 10.08.
Every separate trust administrator and co-trust administrator shall, to the extent
permitted by law, be appointed and act subject to the following provisions and conditions:
(a) all rights, powers, duties and obligations conferred or imposed upon the Trust Administrator,
except for any obligation of the Trust Administrator under this Agreement to advance funds on behalf of
the Master Servicer or the Servicer, shall be conferred or imposed upon and exercised or performed by
the Trust Administrator and such separate trust administrator or co-trust administrator jointly (it
being understood that such separate trust administrator or co-trust administrator is not authorized to
act separately without the Trust Administrator 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 by the Trust
Administrator (whether as Trust Administrator hereunder or as successor to the Master Servicer or the
Servicer), the Trust Administrator 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 Trust
Fund or any portion thereof in any such jurisdiction) shall be exercised and performed singly by such
separate trust administrator or co-trust administrator, but solely at the direction of the Trust
Administrator;
(b) no trust administrator hereunder shall be held personally liable by reason of any act or
omission of any other trust administrator xxxxxxxxx; and
(c) the Master Servicer and the Trust Administrator acting jointly may at any time accept the
resignation of or remove any separate trust administrator or co-trust administrator.
Any notice, request or other writing given to the Trust Administrator shall be deemed
to have been given to each of the then separate trust administrators and co-trust administrators, as
effectively as if given to each of them. Every instrument appointing any separate trust administrator
or co-trust administrator shall refer to this Agreement and the conditions of this Article X. Each
separate trust administrator and co-trust administrator, 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 Trust Administrator 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 Trust Administrator. Every such instrument
shall be filed with the Trust Administrator and a copy thereof given to the Master Servicer or the
Servicers and the Depositor.
Any separate trust administrator or co-trust administrator may, at any time,
constitute the Trust Administrator, 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. The Trust Administrator shall not be responsible for any action or inaction of any
separate Trust Administrator or Co-Trust Administrator. If any separate trust administrator or co-trust
administrator 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 Trust Administrator, to
the extent permitted by law, without the appointment of a new or successor trust administrator.
SECTION 10.11. Office of the Trust Administrator.
The office of the Trust Administrator for purposes of receipt of notices and demands
is the Corporate Trust Office.
SECTION 10.12. Tax Return.
The Master Servicer and each Servicer, upon request, shall furnish the Trust
Administrator with all such information related to the Mortgage Loans in the possession of the Master
Servicer or such Servicer as may be reasonably required in connection with the preparation by the Trust
Administrator of all tax and information returns of the Trust Fund, and the Trust Administrator shall
sign such returns. The Master Servicer and each Servicer, severally and not jointly, shall indemnify the
Trust Administrator for all reasonable costs, including legal fees and expenses, related to errors in
such tax returns due to errors only in such information provided by the Master Servicer or by such
Servicer.
SECTION 10.13. Determination of Certificate Index.
On each Interest Determination Date, the Trust Administrator shall determine each
Certificate Index for the Accrual Period and inform the Master Servicer of such rate and such rate shall
be final and binding, absent a manifest error of the Trust Administrator.
ARTICLE XI
TERMINATION
SECTION 11.01. Termination upon Liquidation or Purchase of all Mortgage Loans.
The obligations and responsibilities of the Master Servicer, the Special Servicer or
the Servicers, the Sellers, the Depositor, the Trustee and the Trust Administrator created hereby with
respect to the related Group or Groups created hereby shall terminate upon the earlier of:
(a) (i) with respect to Loan Group 1, Loan Group 2 and Loan Group 3, the purchase by
the Terminating Entity, at its election, of all Mortgage Loans in such Loan Groups and all
property acquired in respect of any remaining Mortgage Loan in such Loan Groups, which purchase
right the Terminating Entity may exercise at its sole and exclusive election as of any
Distribution Date (such applicable Distribution Date with respect to such Mortgage Loans being
herein referred to as the "Optional Termination Date") on or after the date on which the
aggregate Principal Balance of the Mortgage Loans in such Loan Groups, at the time of the
purchase is less than or equal to 10% of the Aggregate Groups 1-3 Collateral Balance as of the
Cut-off Date; or
(ii) with respect to Loan Group 4, the purchase by the Terminating Entity, at its election, of all
Mortgage Loans in such Loan Group and all property acquired in respect of any remaining
Mortgage Loan in such Loan Group, which purchase right the Terminating Entity may exercise at
its sole and exclusive election as of any Distribution Date (such applicable Distribution Date
with respect to such Mortgage Loans being herein referred to as the "Optional Termination
Date") on or after the date on which the aggregate Principal Balance of the Mortgage Loans in
such Loan Group, at the time of the purchase is less than or equal to 10% of the Aggregate Loan
Group Balance for Loan Group 4 as of the Cut-off Date.
(b) the later of (i) twelve months after the maturity of the last Mortgage Loan remaining in the
Trust Fund, (ii) the 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 (iii) the distribution to
Certificateholders of all amounts required to be distributed to them pursuant to this Agreement; or
(c) (i) with respect to Loan Group 1, Loan Group 2 and Loan Group 3, the purchase by the
Terminating Auction Purchaser of all Mortgage Loans in such Loan Groups and all property
acquired in respect of any remaining Mortgage Loan in such Loan Group (with respect to Loan
Group 1, Loan Group 2 and Loan Group 3, the "Trust Collateral") as described below; or
(ii) with respect to Loan Group 4, the purchase by the Terminating Auction
Purchaser of all Mortgage Loans in Loan Group 4 and all property acquired in respect of any
remaining Mortgage Loan in such Loan Group (with respect to Loan Group 4, the "Trust
Collateral") as described below.
In no event shall the trust created hereby continue beyond the earlier of (i) the
expiration of 21 years from the death of the last survivor of the descendants of Xx. Xxxxxx X. Xxxxxxx,
former Ambassador of the United States to Great Britain, living on the date of execution of this
Agreement or (ii) 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.
The "Mortgage Loan Purchase Price" for any such Optional Termination shall be equal to
the greater of (a) the sum of (i) 100% of the Stated Principal Balance of each Mortgage Loan in the
applicable Loan Group(s) (other than in respect of REO Property) plus accrued and unpaid interest
thereon from the date to which such interest was paid or advanced at the applicable Mortgage Rate, to
but not including the Due Date in the month of the final Distribution Date (or the Net Mortgage Rate
with respect to any related Mortgage Loan currently serviced by the entity exercising such Optional
Termination) and (ii) with respect to any REO Property, 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 Depositor at the expense of the Depositor and (y) the Stated Principal Balance of each
related Mortgage Loan related to any REO Property, in each case and (iii) any remaining unreimbursed
Advances, Servicing Advances and unpaid Servicing Fees (other than any remaining unreimbursed Advances
and Servicing Advances and unpaid Servicing Fees, if any, due to the Terminating Entity) and other
amounts payable to the Trustee and Trust Administrator (the sum of (i), (ii) and (iii), collectively,
the "Par Value") and (b) the Fair Market Value of all of the property of the Trust related to the Loan
Group(s) subject to such Optional Termination.
The "Fair Market Value" shall be the fair market value of all of the property of the
Trust related to the Loan Group(s) subject to an Optional Termination, as agreed upon between the
Terminating Entity and a majority of the holders of the Class AR-L Certificates; provided, however, that
if the Terminating Entity and a majority of the holders of the Class AR-L Certificates do not agree upon
the fair market value of such property of the Trust, the Terminating Entity, or an agent appointed by
the Terminating Entity, shall solicit bids for such property of the Trust until it has received three
bids, and the Fair Market Value shall be equal to the highest of such three bids. The Trust
Administrator shall give notice to the Rating Agencies of any election to purchase Mortgage Loans
pursuant to this Section 11.01 and of the applicable Optional Termination Date.
(d) On any Distribution Date on or after the date on which the aggregate Principal Balance of the
Mortgage Loans in Loan Group 1, Loan Group 2 and Loan Group 3 is less than 5% of the Aggregate
Groups 1-3 Collateral Balance as of the Cut-off Date (a "Terminating Auction Date"), the Trust
Administrator shall solicit bids for the related Trust Collateral from at least three institutions that
are regular purchasers and/or sellers in the secondary market of residential whole mortgage loans
similar to the Mortgage Loans. If the Trust Administrator receives at least three bids for the related
Trust Collateral, and one of such bids is equal to or greater than the Par Value, the Trust
Administrator shall sell the related Trust Collateral to the highest bidder (a "Terminating Auction
Purchaser") at the price offered by the Terminating Auction Purchaser (a "Mortgage Loan Terminating
Auction Price"); provided, however, that the Seller shall be disqualified from bidding and may not be a
Terminating Auction Purchaser. If the Trust Administrator receives less than three bids, or does not
receive any bid that is equal to or greater than the Par Value, the Trust Administrator shall, on each
six-month anniversary of the initial Terminating Auction Date, repeat these auction procedures until the
Trust Administrator receives a bid that is equal to or greater than the Par Value, and upon receipt of
such bid shall sell the related Trust Collateral to the Terminating Auction Purchaser at that Mortgage
Loan Terminating Auction Price; provided, however, that the Trust Administrator shall not be required to
repeat these auction procedures on any Distribution Date for any six-month anniversary of the initial
Terminating Auction Date unless the Trust Administrator reasonably believes that there is a reasonable
likelihood of receiving a bid in excess of the Par Value. The Trust Administrator shall give notice to
the Rating Agencies and each Servicer that is servicing any of the related Mortgage Loans of the sale of
the related Trust Collateral pursuant to this Section 11.01 (a "Terminating Auction Sale") and of the
Terminating Auction Date. Notwithstanding anything to the contrary herein, the Terminating Auction
Purchaser shall not be the Depositor, the Seller or any of their respective Affiliates.
(e) On any Distribution Date on or after the date on which the aggregate Principal Balance of the
Mortgage Loans in Loan Group 4 is less than 5% of the Aggregate Loan Group Balance for Loan Group 4 as
of the Cut-off Date (a "Terminating Auction Date"), the Trust Administrator shall solicit bids for the
related Trust Collateral from at least three institutions that are regular purchasers and/or sellers in
the secondary market of residential whole mortgage loans similar to the Mortgage Loans; provided,
however, that the Trust Administrator may not solicit any such bids at any time while there are NIM Notes
outstanding. If the Trust Administrator receives at least three bids for the related Trust Collateral,
and one of such bids is equal to or greater than the Par Value, the Trust Administrator shall sell the
related Trust Collateral to the highest bidder (a "Terminating Auction Purchaser") at the price offered
by the Terminating Auction Purchaser (a "Mortgage Loan Terminating Auction Price"); provided, however,
that the Seller shall be disqualified from bidding and may not be a Terminating Auction Purchaser. If
the Trust Administrator receives less than three bids, or does not receive any bid that is equal to or
greater than the Par Value, the Trust Administrator shall, on each six-month anniversary of the initial
Terminating Auction Date, repeat these auction procedures until the Trust Administrator receives a bid
that is equal to or greater than the Par Value, and upon receipt of such bid shall sell the related
Trust Collateral to the Terminating Auction Purchaser at that Mortgage Loan Auction Price; provided,
however, that the Trust Administrator shall not be required to repeat these auction procedures on any
Distribution Date for any six-month anniversary of the initial Terminating Auction Date unless the Trust
Administrator reasonably believes that there is a reasonable likelihood of receiving a bid in excess of
the Par Value. The Trust Administrator shall give notice to the Rating Agencies and each Servicer that
is servicing any of the related Mortgage Loans of the sale of the related Trust Collateral pursuant to
this Section 11.01 (a "Terminating Auction Sale") and of the Terminating Auction Date. Notwithstanding
anything to the contrary herein, the Terminating Auction Purchaser shall not be the Depositor, the
Seller or any of their respective Affiliates.
SECTION 11.02. Determination of the Terminating Entity.
(a) If any Servicer intends to be the Terminating Entity, such party must give written notice to
the Trust Administrator no later than twenty (20) days prior to the first day of the Optional
Termination Notice Period. Such notice shall also indicate the Loan Group(s) of the Mortgage Loans to
be repurchased. Upon receiving such notice, the Trust Administrator shall immediately request from
DLJMC and DLJMC shall deliver no later than seventeen (17) days prior to the first day of the Optional
Termination Notice Period a letter indicating whether or not DLJMC retains the servicing rights to any
Mortgage Loan in any of the related Loan Groups.
(b) (A) With respect to the purchase of the Mortgage Loans in Loan Group 1, Loan
Group 2 and Loan Group 3, the Trust Administrator shall determine the "Terminating Entity" as
follows:
(i) DLJMC, if it is the owner of the servicing rights with
respect to any such Mortgage Loans on the Optional Termination Date;
(ii) SPS, if (a) DLJMC is not the owner of the servicing rights
with respect to any such Mortgage Loans on the Optional Termination Date and (b) SPS is a
Servicer with respect to any such Mortgage Loans on the Optional Termination Date and SPS
has given notice to the Trust Administrator pursuant to Section 11.02(a) above; or
(iii) the Majority Servicer on the Optional Termination Date, if
(a) DLJMC is not the owner of the servicing rights with respect to any such Mortgage Loans
on the Optional Termination Date and (b) SPS has not given notice to the Trust Administrator
pursuant to Section 11.02(a) above.
(B) With respect to the purchase of the Mortgage Loans in Loan Group 4,
the Trust Administrator shall determine the "Terminating Entity" as follows:
(i) DLJMC, if it is the owner of the servicing rights with
respect to any such Mortgage Loans on the Optional Termination Date;
(ii) SPS, if (a) DLJMC is not the owner of the servicing rights
with respect to any such Mortgage Loans on the Optional Termination Date and (b) SPS is a
Servicer with respect to any such Mortgage Loans on the Optional Termination Date and SPS
has given notice to the Trust Administrator pursuant to Section 11.02(a) above; or
(iii) the Majority Servicer on the Optional Termination Date, if
(a) DLJMC is not the owner of the servicing rights with respect to any such Mortgage Loans
on the Optional Termination Date and (b) SPS has not given notice to the Trust Administrator
pursuant to Section 11.02(a) above.
(c) No later than fifteen (15) days prior to the first day of the Optional Termination Notice
Period, the Trust Administrator shall provide notice to each Servicer that is a servicer of any of the
Mortgage Loans in the related Loan Group(s) of the identity of the Terminating Entity for such Loan
Group(s).
SECTION 11.03. Procedure Upon Optional Termination or Terminating Auction Sale.
(a) In case of any Optional Termination, the Terminating Entity shall, no later than ten (10) days
prior to the first day of the Optional Termination Notice Period, notify the Trustee and Trust
Administrator of such Optional Termination Date and of the applicable purchase price of the Mortgage
Loans to be purchased. Upon purchase by the Terminating Entity of any Mortgage Loans pursuant to
Section 11.01, the Trust Administrator shall notify each Servicer that is servicing any of such Mortgage
Loans (and with respect to the purchase of the Group 4 Loans, the Swap Counterparty) of such purchase.
(b) Any purchase of the Mortgage Loans by the Terminating Entity shall be made on an Optional
Termination Date by deposit of the applicable purchase price into the Certificate Account before the
Distribution Date on which such purchase is effected. Upon receipt by the Trust Administrator of an
Officer's Certificate of the Terminating Entity certifying as to the deposit of such purchase price into
the Certificate Account, the Trustee, the Trust Administrator and each co-trust administrator and
separate trust administrator, if any, then acting as such under this Agreement, shall, upon request and
at the expense of the Terminating Entity execute and deliver all such instruments of transfer or
assignment, in each case without recourse, as shall be reasonably requested by the Terminating Entity to
vest title in the Terminating Entity in the Mortgage Loans so purchased and shall transfer or deliver to
the Terminating Entity the purchased Mortgage Loans. Any distributions on the Mortgage Loans which have
been subject to an Optional Termination received by the Trust Administrator subsequent to (or with
respect to any period subsequent to) the Optional Termination Date shall be promptly remitted by it to
the Terminating Entity.
(c) Any purchase of the Trust Collateral by the related Terminating Auction Purchaser shall be made
on an Terminating Auction Date by receipt of the Trust Administrator of the related Mortgage Loan
Terminating Auction Price from the Terminating Auction Purchaser, and deposit of such Mortgage Loan
Terminating Auction Price into the Certificate Account by the Trust Administrator before the
Distribution Date on which such purchase is effected. Upon deposit of such purchase price into the
Certificate Account, the Trustee and the Trust Administrator and each co-trust administrator and
separate trust administrator, if any, then acting as such under this Agreement, shall, upon request and
at the expense of the Terminating Auction Purchaser execute and deliver all such instruments of transfer
or assignment, in each case without recourse, as shall be reasonably requested by the Terminating
Auction Purchaser to vest title in the Terminating Auction Purchaser in the Trust Collateral so
purchased and shall transfer or deliver to the Terminating Auction Purchaser the purchased Trust
Collateral.
(d) Notice of the Distribution Date on which the Trust Administrator anticipates that the final
distribution shall be made on a Class of Certificates (whether upon Optional Termination, Terminating
Auction Sale or otherwise), shall be given promptly by the Trust Administrator by first class mail to
Holders of the affected Certificates. Such notice shall be mailed no earlier than the 15th day and not
later than the 10th day preceding the applicable Optional Termination Date, Terminating Auction Date or
date of final distribution, as the case may be. Such notice shall specify (i) the Distribution Date
upon which final distribution on the affected Certificates shall be made upon presentation and surrender
of such Certificates at the office or agency therein designated, (ii) the amount of such final
distribution and (iii) that the Record Date otherwise applicable to such Distribution Date is not
applicable, such distribution being made only upon presentation and surrender of such Certificates at
the office or agency maintained for such purposes (the address of which shall be set forth in such
notice).
(e) In the event that any Certificateholders shall not surrender Certificates for cancellation
within six months after the date specified in the above mentioned written notice, the Trust
Administrator shall give a second written notice to the remaining such 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 Certificates shall not have been surrendered for
cancellation, the Trust Administrator 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 subject
to the Trust Fund.
(f) Notwithstanding anything to the contrary herein, the occurrence of an Optional Termination or
Terminating Auction Sale shall be subject to, and shall in no way adversely affect the right of
GreenPoint to continue servicing and collecting its Servicing Fee for any GreenPoint Serviced Mortgage
Loan that remains outstanding at the time of such Optional Termination or Terminating Auction Sale or
the right of Xxxxx Fargo to continue servicing and collecting its Servicing Fee for any Xxxxx Fargo
Serviced Mortgage Loan that remains outstanding at the time of such Optional Termination.
SECTION 11.04. Additional Termination Requirements.
(a) In the event the Terminating Entity exercises its purchase option pursuant to Section 11.01(A)
or a Terminating Auction Sale shall have occurred pursuant to Section 11.01(c), the related subsidiary
REMIC shall be terminated in accordance with the following additional requirements, unless the Trustee
and the Trust Administrator have received an Opinion of Counsel to the effect that the failure to comply
with the requirements of this Section 11.04 will not (i) result in the imposition of taxes on a
"prohibited transaction" of any REMIC created hereunder, as described in Section 860F of the Code, or
(ii) cause any REMIC created hereunder to fail to qualify as a REMIC at any time that any Certificates
are outstanding:
(i) within 90 days prior to the final Distribution Date set forth in the notice given by
Terminating Entity under Section 11.03, the Holder of the Residual Certificates shall adopt a
plan of complete liquidation for the related REMIC; and
(ii) at or after the time of adoption of any such plan of complete liquidation for such REMIC and at
or prior to the final Distribution Date, the Trustee shall sell all of the assets of such REMIC
to the Depositor for cash.
(b) Upon the exercise of an Optional Termination by the Terminating Entity or upon the occurrence
of a Terminating Auction Sale in respect of either REMIC I or REMIC II, as applicable, pursuant to
paragraph (a) of this Section 11.04, followed by the exercise of an Optional Termination by the
Terminating Entity or upon the occurrence of a Terminating Auction Sale in respect of the remaining
subsidiary REMIC (the "Remaining Subsidiary REMIC") pursuant to Section 11.01, each remaining REMIC
shall be terminated in accordance with the following additional requirements, unless the Trustee and the
Trust Administrator have received an Opinion of Counsel to the effect that the failure to comply with
the requirements of this Section 11.04 will not (i) result in the imposition of taxes on a "prohibited
transaction" of a REMIC, as described in Section 860F of the Code, or (ii) cause any REMIC created
hereunder to fail to qualify as a REMIC at any time that any Certificates are outstanding:
(i) concurrently with the adoption of the plan of complete liquidation of the Remaining Subsidiary
REMIC, as set forth in paragraph (a) of this Section 11.04, the Holder of the Residual
Certificates, as applicable, shall adopt a plan of complete liquidation of each remaining
REMIC; and
(ii) at or after the time of adoption of any such plan of complete liquidation for each such
remaining REMIC, at or prior to the final Distribution Date of the Remaining Subsidiary REMIC
to be terminated, the Trustee shall sell all of the assets of each such remaining REMIC to the
Depositor for cash.
(c) By its acceptance of a Residual Certificate, the Holder thereof hereby agrees to adopt such a
plan of complete liquidation and to take such other action in connection therewith as may be reasonably
required to liquidate and otherwise terminate any REMIC created pursuant to this Agreement.
ARTICLE XII
MISCELLANEOUS PROVISIONS
SECTION 12.01. Amendment.
(a) This Agreement may be amended from time to time by the Depositor, the Master Servicer, the
Servicers, the Special Servicer, the Seller, the Trust Administrator and the Trustee, without the
consent of any of the Certificateholders,
(i) to cure any error or ambiguity,
(ii) to correct or supplement any provisions herein that may be inconsistent with any other
provisions herein or in the Prospectus Supplement,
(iii) to modify, eliminate or add to any of its provisions to such extent as shall be necessary or
desirable to maintain the qualification of the Trust Fund as a REMIC at all times that any
Certificate is outstanding or to avoid or minimize the risk of the imposition of any federal
income tax on the Trust Fund pursuant to the Code that would be a claim against the Trust Fund,
provided that the Trustee has received an Opinion of Counsel to the effect that (A) such action
is necessary or desirable to maintain such qualification or to avoid or minimize the risk of
the imposition of any such federal income tax and (B) such action will not adversely affect the
status of the Trust Fund as a REMIC or adversely affect in any material respect the interests
of any Certificateholder,
(iv) in connection with the appointment of a successor servicer, to modify, eliminate or add to any
of the servicing provisions, provided the Rating Agencies confirm the rating of the
Certificates, or
(v) to make any other provisions with respect to matters or questions arising under this Agreement
that are not materially inconsistent with the provisions of this Agreement, provided that such
action shall not adversely affect in any material respect the interests of any
Certificateholder or cause an Adverse REMIC Event. Any Amendment pursuant to
Section 12.01(a)(v) shall not be deemed to adversely affect in any material respect the
interests of any Certificateholder if a letter is obtained from each Rating Agency stating that
such amendment would not result in the downgrading or withdrawal of the respective ratings then
assigned to the Certificates; or to comply with the provisions of Regulation AB.
(b) Except as provided in Section 12.01(c), this Agreement may be amended from time to time by the
Depositor, the Master Servicer, the Servicers, the Special Servicer, the Seller, the Trust Administrator
and the Trustee with the consent of the Holders of Certificates evidencing, in the aggregate, not less
than 66 2/3% of the Voting Rights of all the Certificates 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 the Certificates; provided, however, that no such amendment may
(i) reduce in any manner the amount of, delay the timing of or change the manner in which payments
received on or with respect to Mortgage Loans are required to be distributed with respect to any
Certificate without the consent of the Holder of such Certificate, (ii) adversely affect in any material
respect the interests of the Holders of a Class of Certificates in a manner other than as set forth in
(i) above without the consent of the Holders of Certificates evidencing not less than 66 2/3% of the
Voting Rights of such Class, (iii) reduce the aforesaid percentages of Voting Rights, the holders of
which are required to consent to any such amendment without the consent of 100% of the Holders of
Certificates of the Class affected thereby, (iv) change the percentage of the Stated Principal Balance
of the Mortgage Loans specified in Section 11.01(a) relating to optional termination of the Trust Fund,
(v) change the percentage of the Stated Principal Balance of the Mortgage Loans specified in
Sections 11.01(d) or (e) relating to a Terminating Auction Sale, or (vi) modify the provisions of this
Section 12.01.
It shall not be necessary for the consent of Certificateholders under this
Section 12.01 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 Trust Administrator may prescribe.
(c) This Agreement may be amended from time to time by the Depositor, the Master Servicer, the
Special Servicer, the Servicers, the Trust Administrator and the Trustee for the purpose of making one
or more REMIC elections with respect to one or more Classes of Certificates delivered to the Trustee and
issuing one or more additional classes of certificates representing interests in the Classes of
Certificates delivered to the Trustee; provided, however, such amendment shall require the consent of
100% of the Holders of the Certificates of the Class or Classes delivered to the Trust Administrator and
such amendment shall not cause an Adverse REMIC Event.
(d) Promptly after the execution of any amendment to this Agreement, the Trust Administrator shall
furnish written notification of the substance of such amendment to each Certificateholder, and the
Rating Agencies.
(e) Prior to the execution of any amendment to this Agreement, each of the Trustee and the Trust
Administrator shall receive and be entitled to conclusively rely on an Opinion of Counsel (at the
expense of the Person seeking such amendment) stating that the execution of such amendment is authorized
and permitted by this Agreement. The Trustee and the Trust Administrator may, but shall not be
obligated to, enter into any such amendment which affects the Trustee's or the Trust Administrator's own
rights, duties or immunities under this Agreement.
(f) The Master Servicer and the Trust Administrator may consent to any amendment of a Designated
Servicing Agreement to make any other provisions with respect to matters or questions arising under such
Designated Servicing Agreement or this Agreement that are not materially inconsistent with the
provisions of such Designated Servicing Agreement and this Agreement, provided that such action shall
not adversely affect in any material respect the interests of any Certificateholder or cause an Adverse
REMIC Event. Any amendment pursuant to this Section 12.01(f) shall not be deemed to adversely affect in
any material respect the interests of any Certificateholders if a letter is obtained from each Rating
Agency stating that such amendment would not result in the downgrading or withdrawal of the respective
ratings then assigned to the Certificates.
(g) Neither the Master Servicer nor the Trust Administrator shall consent to any amendment of a
Designated Servicing Agreement which shall adversely affect in any material respect the interests of the
Holders of a Class of Certificates without the consent of the Holders of Certificates evidencing not
less than 66-2/3% of the Voting Rights of such Class.
It shall not be necessary for the consent of Certificateholders under this
Section 12.01 to approve the particular form of any proposed amendment of a Designated Servicing
Agreement, 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 Trust Administrator may
prescribe.
Promptly after the execution of any amendment to a Designated Servicing Agreement
pursuant to Section 12.01(f) or (g), the Trust Administrator shall furnish, upon written notice of such
amendment, written notification of the substance of such amendment to each Certificateholder, and the
Rating Agencies.
(h) Notwithstanding any other provision of this Agreement, no amendment shall be made affecting the
rights of the Holders of the Class P Certificates to receive Assigned Prepayment Premiums, including any
amendment to Section 3.21, without the consent of 100% of the Holders of the Class P Certificates.
(i) Notwithstanding anything to the contrary in this Section 12.01, the Master Servicer, the
Special Servicer, the Servicers, the Seller, the Trust Administrator and the Trustee shall reasonably
cooperate with the Depositor and its counsel to enter into such amendments or modifications to the
Agreement as may be necessary to comply with Regulation AB and any interpretation thereof by the
Commission.
(j) Without the consent of the Swap Counterparty, the Seller and the Depositor shall not enter into
any amendment or modification of the terms and provisions of this Agreement if such amendment or
modification would materially adversely affect the rights and interests of the Swap Counterparty
hereunder.
SECTION 12.02. Recordation of Agreement; Counterparts.
(a) This Agreement (other than Schedule I) 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 Mortgaged Properties are situated, and in any other appropriate public recording office or
elsewhere. Such recordation, if any, shall be effected by the Depositor at its expense, but only upon
direction by the Trustee (acting at the direction of the holders of Certificates evidencing a majority
of the aggregate Class Principal Balance) accompanied by an Opinion of Counsel (at the Depositor's
expense) to the effect that non-recordation materially and adversely affects the interests of the
Certificateholders.
(b) 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 12.03. Governing Law.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK, WITHOUT REGARD TO THE CONFLICT OF LAW PRINCIPALS THEREOF, OTHER THAN SECTIONS 5-1401
AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW.
SECTION 12.04. Intention of Parties.
(a) It is the express intent of the Depositor, the Seller, the Master Servicer, the Special
Servicer, the Servicers, the Trust Administrator and the Trustee that (i) the conveyance by DLJMC of the
Mortgage Loans to the Depositor pursuant to the Assignment and Assumption Agreement and (v) the
conveyance by the Depositor to the Trustee as provided for in Section 2.01 of each of the Seller's and
Depositor's right, title and interest in and to the Mortgage Loans be, and be construed as, an absolute
sale and assignment by DLJMC to the Depositor and by the Depositor to the Trustee of the Mortgage Loans
for the benefit of the Certificateholders. Further, it is not intended that any conveyance be deemed to
be a pledge of the Mortgage Loans by DLJMC to the Depositor or by the Depositor to the Trustee to secure
a debt or other obligation. However, in the event that the Mortgage Loans are held to be property of
DLJMC or the Depositor, as applicable, or if for any reason the Assignment and Assumption Agreement or
this Agreement is held or deemed to create a security interest in the Mortgage Loans, then it is
intended that (i) this Agreement shall also be deemed to be a security agreement within the meaning of
Articles 8 and 9 of the New York Uniform Commercial Code and the Uniform Commercial Code of any other
applicable jurisdiction; (ii) the conveyances provided for in Section 2.01 shall be deemed to be a grant
by the Seller and the Depositor to the Trustee on behalf of the Certificateholders, to secure payment in
full of the Secured Obligations (as defined below), of a security interest in all of the Seller's and
the Depositor's right (including the power to convey title thereto), title and interest, whether now
owned or hereafter acquired, in and to the Mortgage Loans, including the Mortgage Notes, the Mortgages,
any related insurance policies and all other documents in the related Mortgage Files, and all accounts,
contract rights, general intangibles, chattel paper, instruments, documents, money, deposit accounts,
certificates of deposit, goods, letters of credit, advices of credit and uncertificated securities
consisting of, arising from or relating to (A) the Mortgage Loans, including with respect to each
Mortgage Loan, the Mortgage Note and related Mortgage, and all other documents in the related Trustee
Mortgage Files, and including any Qualified Substitute Mortgage Loans; (B) pool insurance policies,
hazard insurance policies and any bankruptcy bond relating to the foregoing, if applicable; (C) the
Certificate Account; (D) the Collection Account; (E) all amounts payable after the Cut-off Date to the
holders of the Mortgage Loans in accordance with the terms thereof; (F) all income, payments, proceeds
and products of the conversion, voluntary or involuntary, of the foregoing into cash, instruments,
securities or other property, including without limitation all amounts from time to time held or
invested in the Certificate Account, whether in the form of cash, instruments, securities or other
property; and (G) all cash and non-cash proceeds of any of the foregoing; (iii) the possession by the
Trustee or any other agent of the Trustee of Mortgage Notes or such other items of property as
constitute instruments, money, documents, advices of credit, letters of credit, goods, certificated
securities or chattel paper shall be deemed to be a "possession by the secured party," or possession by
a purchaser or a person designated by him or her, for purposes of perfecting the security interest
pursuant to the Uniform Commercial Code (including, without limitation, Sections 9-313, 8-313 or 8-321
thereof); and (iv) notifications to persons holding such property, and acknowledgments, receipts or
confirmations from persons holding such property, shall be deemed notifications to, or acknowledgments,
receipts or confirmations from, financial intermediaries, securities intermediaries, bailees or agents
(as applicable) of the Trustee for the purpose of perfecting such security interest under applicable
law. "Secured Obligations" means (i) the rights of each Certificateholder to be paid any amount owed to
it under this Agreement and (ii) all other obligations of the Seller and the Depositor under this
Agreement and the Assignment and Assumption Agreement.
(b) The Seller and the Depositor, and, at the Depositor's direction, the Master Servicer or the
Servicers, the Trustee and the Trust Administrator, shall, to the extent consistent with this Agreement,
take such reasonable actions as may be necessary to ensure that, if this Agreement were deemed to create
a security interest in the Mortgage Loans and the other property described above, such security interest
would be deemed to be a perfected security interest of first priority as applicable. The Depositor
shall prepare and file, at the related Servicer's expense, all filings necessary to maintain the
effectiveness of any original filings necessary under the Uniform Commercial Code as in effect in any
jurisdiction to perfect the Trustee's security interest in or lien on the Mortgage Loans, including
without limitation (i) continuation statements, and (ii) such other statements as may be occasioned by
any transfer of any interest of the Master Servicer or any Servicer or the Depositor in any Mortgage
Loan.
SECTION 12.05. Notices.
In addition to other notices provided under this Agreement, the Trust Administrator
shall notify the Rating Agencies in writing: (a) of any substitution of any Mortgage Loan; (b) of any
payment or draw on any insurance policy applicable to the Mortgage Loans; (c) of the final payment of
any amounts owing to a Class of Certificates; (d) any Event of Default under this Agreement; and (e) in
the event any Mortgage Loan is purchased in accordance with this Agreement.
All directions, demands and notices hereunder shall be in writing and shall be deemed
to have been duly given when received (i) in the case of the Depositor, with respect to notices required
to be delivered by the Trust Administrator pursuant to Article XIII, Credit Suisse First Boston Mortgage
Securities Corp. via facsimile to (000) 000-0000 or via email to Xxxxx.Xxxxxxxxx@Xxxxxx-Xxxxxx.xxx,
and for all other purposes, Credit Suisse First Boston Mortgage Securities Corp., 00 Xxxxxxx Xxxxxx,
0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxx Xxxx (with a copy to DLJ Mortgage Acceptance Corp.,
00 Xxxxxxx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxx Xxxx); (ii) in the case of the
Trustee, the Corporate Trust Office, Attention: Xxxxxxx X. Xxxxxxxx, or such other address as may
hereafter be furnished to the Depositor in writing by the Trustee; (iii) in the case of DLJMC,
00 Xxxxxxx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxx Xxxx, Fax: (000) 000-0000 (with
a copy to DLJ Mortgage Acceptance Corp., 00 Xxxxxxx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xxxxx Xxxxxxxxx, Fax: (000) 000-0000), or such other address as may be hereafter furnished to
the Depositor and the Trustee by DLJMC in writing; (iv) in the case of Xxxxx'x, 00 Xxxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Xxxxxxxxx Xxxxxxxxx; (v) in the case of Standard & Poor's, 00 Xxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000; (vi) in the case of SPS, 0000 Xxxxx Xxxx Xxxxxx, Xxxx Xxxx Xxxx,
Xxxx 00000, Attention: Xxxxxx Xxxxx, with a copy to 0000 Xxxxx Xxxx Xxxxxx, Xxxx Xxxx Xxxx, Xxxx 00000,
Attention: General Counsel; (vii) in the case of Xxxxx Fargo, as Master Servicer, Corporate Trust
Office, 0000 Xxx Xxxxxxxxx Xxxx, Xxxxxxxx, XX 00000, Attention: CSFB ARMT 2006-3 or such other address
as may be hereafter furnished to the Depositor or the Trustee in writing by Xxxxx Fargo; (viii) in the
case of GreenPoint, 000 Xxxx Xxxxxx Xxxxx, Xxxxxx, XX 00000, Attn: Secondary Marketing for GPM, (ix) in
the case of the Trust Administrator, the Corporate Trust Office; (x) in the case of the Special
Servicer, 00000 XX Xxxxxxxx Xxx, Xxxxxxxxx, XX 00000, Attention: Xxxxx Xxxxxxxx, (xi) in the case of
Xxxxx Fargo, with respect to servicing issues, Xxxxx Fargo Bank, N.A., 1 Home Campus, Des Moines, Iowa
50328-0001, Attention: Xxxx X. Xxxxx, MAC-X2302-033, Fax: (000) 000-0000, and with respect to all other
issues, Xxxxx Fargo Bank, N.A., 0000 Xxx Xxxxxxx Xxx, Xxxxxxxxx, Xxxxxxxx 00000,
Attention: Xxxx X. Xxxxxxxx, MAC-X3902-02X, Fax: (000) 000-0000, in each case with a copy to Xxxxx Fargo
Bank, N.A., 1 Home Campus, Des Moines, Iowa 50328-0001, Attention: General Counsel, MAC-X2401-06T, or
such other address as may be hereafter furnished in writing by Xxxxx Fargo, and (xii) in the case of the
Swap Counterparty and Group 4 Interest Rate Cap Counterparty, Credit Suisse International, Xxx Xxxxx
Xxxxxx, Xxxxxx X00 0XX, Attention: Head of Credit Risk Management, with copies to: Managing Director -
Operations Department and Managing Director - Legal Department, or such other address as may be
hereafter furnished in writing by the Swap Counterparty or Group 4 Interest Rate Cap Counterparty, as
applicable.
Notices to Certificateholders shall be deemed given when mailed, first class postage
prepaid.
SECTION 12.06. 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 12.07. Limitation on Rights of Certificateholders.
The death or incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust Fund, 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 Fund, 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 Xxxxxx previously shall have given to the Trust
Administrator a written notice of an Event of Default and of the continuance thereof, as provided
herein, 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 upon the Trust Administrator to
institute such action, suit or proceeding in its own name as Trust Administrator hereunder and shall
have offered to the Trust Administrator such reasonable indemnity as it may require against the costs,
expenses, and liabilities to be incurred therein or thereby, and the Trust Administrator, 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 Trust Administrator,
that no one or more Holders of Certificates shall have any right in any manner whatever by virtue or by
availing itself or themselves of any provisions of this Agreement to affect, disturb or prejudice the
rights of the Holders of any other of the Certificates, or to obtain or seek to obtain priority over or
preference to any other such Holder or to enforce any right under this Agreement, except in the manner
herein provided and for the common benefit of all Certificateholders. For the protection and
enforcement of the provisions of this Section 12.07, each and every Certificateholder and the Trust
Administrator shall be entitled to such relief as can be given either at law or in equity.
SECTION 12.08. 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 Trust Administrator pursuant to this Agreement, are and shall be deemed
fully paid.
SECTION 12.09. Protection of Assets.
Except for transactions and activities entered into in connection with the
securitization that is the subject of this agreement, the trust 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.
Each party to this agreement agrees that it will not file an involuntary bankruptcy
petition against the Trust Fund or initiate any other form of insolvency proceeding until 366 days after
the Certificates have been paid.
SECTION 12.10. Non-Solicitation.
From and after the date of this Agreement, each of the Depositor, the Seller, the
Master Servicer, the Servicers, the Trust Administrator and the Trustee agrees that it will not take any
action or permit or cause any action to be taken by any of its agents or affiliates, or by any
independent contractors on any such party's behalf, to personally, by telephone, by mail, or
electronically by e-mail or through the Interest or otherwise, solicit the borrower or obligor under any
Mortgage Loan to refinance the Mortgage Loan, in whole or in part. Notwithstanding the foregoing, it is
understood and agreed that neither (i) promotions undertaken by the Depositor, the Seller, the Master
Servicer, any Servicer, the Trust Administrator or the Trustee or any affiliate of any such party that
originates mortgage loans in the normal course, which are directed to the general public at large, or
segments thereof, including, without limitation, mass mailings based on commercially acquired mailing
lists or newspaper, radio and television advertisements nor (ii) serving the refinancing needs of a
Mortgagor who, without solicitation, contacts either party in connection with the refinance of such
Mortgage or Mortgage Loan, shall constitute solicitation under this Section 12.10, provided, that no
segment of the general public shall consist primarily of the borrowers or obligors under the Mortgage
Loans. None of the Depositor, the Seller, the Master Servicer, any Servicer, the Trust Administrator or
the Trustee shall permit the sale of the name of any Mortgagor or any list of names that consist
primarily of the Mortgages to any Person.
ARTICLE XIII
EXCHANGE ACT REPORTING
SECTION 13.01. Commission Reporting.
The Trust Administrator, each Servicer and the Master Servicer shall reasonably
cooperate with the Depositor in connection with the Trust's satisfying the reporting requirements under
the Exchange Act. The Trust Administrator shall prepare on behalf of the Depositor any Forms 8-K, 10-D
and 10-K customary for similar securities as required by the Exchange Act and the rules and regulations
of the Commission thereunder, and the Depositor shall sign and the Trust Administrator shall file (via
XXXXX) such Forms on behalf of the Depositor.
Form 10-D and Form 10-K require the registrant to indicate (by checking "yes" or "no")
that it "(1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act
during the preceding 12 months (or for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90 days." The Depositor
hereby represents to the Trust Administrator that, as of the Closing Date, the Depositor has filed all
such required reports during the preceding 12 months and that it has been subject to such filing
requirement for the past 90 days. The Depositor shall notify the Trust Administrator in writing, no
later than the fifth calendar day after the related Distribution Date with respect to the filing of a
report on Form 10-D and no later than March 15th with respect to the filing of a report on Form 10-K, if
the answer to each question should be "no." The Trust Administrator shall be entitled to rely on such
representations in preparing, executing and/or filing any such report.
SECTION 13.02. Form 10-D Reporting
Within 15 days after each Distribution Date (subject to permitted extensions under the
Exchange Act), the Trust Administrator shall prepare and file on behalf of the Trust Fund any Form 10-D
required by the Exchange Act, in form and substance as required by the Exchange Act. The Trust
Administrator shall file each Form 10-D with a copy of the related Monthly Statement attached thereto.
Any disclosure in addition to the Monthly Statement that is required to be included on Form 10-D
("Additional Form 10-D Disclosure") shall be reported by the parties set forth on Exhibit S to the
Depositor and the Trust Administrator and directed and approved by the Depositor pursuant to the
following paragraph and the Trust Administrator shall have no duty or liability for any failure
hereunder to determine or prepare any Additional Form 10-D Disclosure, except as set forth in the next
paragraph.
As set forth on Exhibit S hereto, within five calendar days after the related
Distribution Date, (i) the parties set forth thereon shall be required to provide to the Trust
Administrator and the Depositor, to the extent known by a responsible officer thereof, in
XXXXX-compatible form, or in such other form as otherwise agreed upon by the Trust Administrator and such
party, the form and substance of any Additional Form 10-D Disclosure, if applicable, together with an
additional disclosure notification in the form of Exhibit W hereto (an "Additional Disclosure
Notification") and (ii) the Depositor shall approve, as to form and substance, or disapprove, as the
case may be, the inclusion of the Additional Form 10-D Disclosure on Form 10-D. The Depositor shall be
responsible for any reasonable fees and expenses assessed or incurred by the Trust Administrator in
connection with including any Additional Form 10-D Disclosure on Form 10-D pursuant to this paragraph.
After preparing the Form 10-D, the Trust Administrator shall forward electronically a
draft copy of the Form 10-D to the Depositor as soon as possible, however, in no event later than the
11th calendar day after the related Distribution Date. Within two business days of receipt, but in no
event no later than the Business Day prior to the date specified in the next sentence, the Depositor
shall notify the Trust Administrator of any changes to or approval of such Form 10-D. In the absence of
receipt of any written changes or approval, the Trust Administrator shall be entitled to assume that
such Form 10-D is in final form and the Trust Administrator may proceed with the execution filing of the
Form 10-D. No later than two Business Days prior to the 15th calendar day after the related
Distribution Date, a duly authorized representative of the Master Servicer shall sign the Form 10-D. If
a Form 10-D cannot be filed on time or if a previously filed Form 10-D needs to be amended, the Trust
Administrator shall follow the procedures set forth in Section 13.05. Promptly (but no later than one
Business Day) after filing with the Commission, the Trust Administrator shall make available on its
internet website a final executed copy of each Form 10-D prepared and filed by the Trust Administrator.
Each party to this Agreement acknowledges that the performance by the Master Servicer and the Trust
Administrator of its duties under this Section 13.02 related to the timely preparation, execution and
filing of Form 10-D is contingent upon such parties strictly observing all applicable deadlines in the
performance of their duties under this Section 13.02. Neither the Trust Administrator nor the Master
Servicer shall have any liability for any loss, expense, damage or claim arising out of or with respect
to any failure to properly prepare, timely execute and/or timely file such Form 10-D, where such failure
results from the Trust Administrator's inability or failure to obtain or receive, on a timely basis, any
information from any other party hereto needed to prepare, arrange for execution or file such Form 10-D,
not resulting from its own negligence, bad faith or willful misconduct.
SECTION 13.03. Form 10-K Reporting
Within 90 days after the end of each fiscal year of the Trust or such earlier date as
may be required by the Exchange Act (the "10-K Filing Deadline") (it being understood that the fiscal
year for the Trust ends on December 31st of each year), commencing in March 2007, the Trust
Administrator shall prepare and file on behalf of the Trust a Form 10-K, in form and substance as
required by the Exchange Act. Each such Form 10-K shall include the following items, in each case to
the extent they have been delivered to the Trust Administrator within the applicable time frames set
forth in this Agreement, the related Custodial Agreements and the related Designated Servicing
Agreement, (i) the Item 1123 Certification for each Servicer, each Additional Servicer, the Master
Servicer, Trust Administrator and any Servicing Function Participant engaged by such parties (each, a
"Reporting Servicer") as described under Section 13.06, (ii)(A) the Assessment of Compliance with
servicing criteria for each Reporting Servicer as described under Section 13.07, and (B) if any
Reporting Servicer's Assessment of Compliance identifies any material instance of noncompliance,
disclosure identifying such instance of noncompliance, or if any Reporting Servicer's Assessment of
Compliance is not included as an exhibit to such Form 10-K, disclosure that such report is not included
and an explanation why such report is not included, (iii)(A) the Accountant's Attestation for each
Reporting Servicer, as described under Section 13.08, and (B) if any Accountant's Attestation identifies
any material instance of noncompliance, disclosure identifying such instance of noncompliance, or if any
such Accountant's Attestation is not included as an exhibit to such Form 10-K, disclosure that such
report is not included and an explanation why such report is not included, and (iv) a Xxxxxxxx-Xxxxx
Certification as described in Section 13.09; provided, however, that the Trust Administrator, at its
discretion, may omit from the Form 10-K any Item 1123 Certification, Assessment of Compliance or
Accountants Attestation that is not required to be filed with such Form 10-K pursuant to Regulation AB.
Any disclosure or information in addition to (i) through (iv) above that is required to be included on
Form 10-K ("Additional Form 10-K Disclosure") shall be reported by the parties set forth on Exhibit Y to
the Depositor and Trust Administrator and directed and approved by the Depositor pursuant to the
following paragraph and the Trust Administrator shall have no duty or liability for any failure
hereunder to determine or prepare any Additional Form 10-K Disclosure, except as set forth in the next
paragraph.
As set forth on Exhibit Y hereto, no later than March 1 of each year that the Trust is
subject to the Exchange Act reporting requirements, commencing in 2007, (i) the parties set forth on
Exhibit Y shall be required to provide to the Trust Administrator and the Depositor, to the extent known
by a responsible officer thereof, in XXXXX-compatible form, or in such other form as otherwise agreed
upon by the Trust Administrator and such party, the form and substance of any Additional Form 10-K
Disclosure, if applicable, together with an Additional Disclosure Notification and (ii) the Depositor
shall approve, as to form and substance, or disapprove, as the case may be, the inclusion of the
Additional Form 10-K Disclosure on Form 10-K. The Depositor shall be responsible for any reasonable
fees and expenses assessed or incurred by the Trust Administrator in connection with including any
Additional Form 10-K Disclosure on Form 10-K pursuant to this paragraph.
After preparing the Form 10-K, the Trust Administrator shall forward electronically a
draft copy of the Form 10-K to the Depositor for review. Within three (3) business days of receipt, but
in no event later than March 25, the Depositor shall notify the Trust Administrator in writing (which
may be furnished electronically) of any changes to or approval of such Form 10-K. In the absence of
receipt of any written changes or approval the Trust Administrator shall be entitled to assume that such
Form 10-K is in final form. No later than the close of business on the 4th Business Day prior to the
10-K Filing Deadline, the Depositor shall sign the Form 10-K and return an electronic or fax copy of such
signed Form 10-K (with an original executed hard copy to follow by overnight mail) to the Trust
Administrator. If a Form 10-K cannot be filed on time or if a previously filed Form 10-K needs to be
amended, the Trust Administrator shall follow the procedures set forth in Section 13.05. Promptly (but
no later than 1 Business Day) after filing with the Commission, the Trust Administrator shall make
available on its internet website a final executed copy of each Form 10-K prepared and filed by the
Trust Administrator. The parties to this Agreement acknowledge that the performance by the Master
Servicer and the Trust Administrator of its duties under this Section 13.03 related to the timely
preparation and filing of Form 10-K is contingent upon such parties (and the Custodians, Designated
Servicers and any Additional Servicer or other Servicing Function Participant) strictly observing all
applicable deadlines in the performance of their duties under Article XIII. Neither the Trust
Administrator nor the Master Servicer shall have any liability for any loss, expense, damage or claim
arising out of or with respect to any failure to properly prepare and/or timely file such Form 10-K,
where such failure results from the Trust Administrator's inability or failure to obtain or receive, on
a timely basis, any information from any other party hereto needed to prepare, arrange for execution or
file such Form 10-K, not resulting from its own negligence, bad faith or willful misconduct.
SECTION 13.04. Form 8-K Reporting
Within four (4) Business Days after the occurrence of an event requiring disclosure on
Form 8-K (each such event, a "Reportable Event"), and if requested by the Depositor, the Trust
Administrator shall prepare and file on behalf of the Trust any Form 8-K, as required by the Exchange
Act, provided that the Depositor shall file the initial Form 8-K in connection with the issuance of the
Certificates. Any disclosure or information related to a Reportable Event or that is otherwise required
to be included on Form 8-K ("Form 8-K Disclosure Information") shall be reported by the parties set
forth on Exhibit U to the Depositor and the Trust Administrator and directed and approved by the
Depositor pursuant to the following paragraph and the Trust Administrator shall have no duty or
liability for any failure hereunder to determine or prepare any Form 8-K Disclosure Information or any
Form 8-K, except as set forth in the next paragraph.
As set forth on Exhibit U hereto, for so long as the Trust is subject to the Exchange
Act reporting requirements, no later than the end of business, New York City time, on the 2nd Business
Day after the occurrence of a Reportable Event (i) the parties to this transaction shall be required to
provide to the Trust Administrator and the Depositor, to the extent known by a responsible officer
thereof, in XXXXX-compatible form, or in such other form as otherwise agreed upon by the Trust
Administrator and such party, the form and substance of any Form 8-K Disclosure Information, if
applicable, together with an Additional Disclosure Notification and (ii) the Depositor shall approve, as
to form and substance, or disapprove, as the case may be, the inclusion of the Form 8-K Disclosure
Information. The Depositor shall be responsible for any reasonable fees and expenses assessed or
incurred by the Trust Administrator in connection with including any Form 8-K Disclosure Information on
Form 8-K pursuant to this paragraph.
After preparing the Form 8-K, the Trust Administrator shall forward electronically a
draft copy of the Form 8-K to the Depositor for review. Promptly, but no later than the close of
business on the 3rd business day after the Reportable Event, the Depositor shall notify the Trust
Administrator in writing of any changes to or approval of such Form 8-K. In the absence of receipt of
any written changes or approval, the Trust Administrator shall be entitled to assume that such Form 8-K
is in final form and a duly authorized representative of the Trust Administrator may proceed with the
execution and filing of the Form 8-K. A duly authorized representative of the Master Servicer shall
sign the Form 8-K. If a Form 8-K cannot be filed on time or if a previously filed Form 8-K needs to be
amended, the Trust Administrator shall follow the procedures set forth in Section 13.05. Promptly (but
no later than one Business Day) after filing with the Commission, the Trust Administrator shall make
available on its internet website a final executed copy of each Form 8-K prepared and filed by the Trust
Administrator. The parties to this Agreement acknowledge that the performance by the Trust
Administrator and the Master Servicer of its duties under this Section 13.04 related to the timely
preparation and filing of Form 8-K is contingent upon such parties strictly observing all applicable
deadlines in the performance of their duties under this Section 13.04. Neither the Master Servicer nor
the Trust Administrator shall have any liability for any loss, expense, damage or claim arising out of
or with respect to any failure to properly prepare and/or timely file such Form 8-K, where such failure
results from the Trust Administrator's inability or failure to obtain or receive, on a timely basis, any
information from any other party hereto needed to prepare, arrange for execution or file such Form 8-K,
not resulting from its own negligence, bad faith or willful misconduct.
SECTION 13.05. Delisting; Amendment; Late Filing of Reports
On or before January 30 of the first year in which the Trust Administrator is able to
do so under applicable law, the Trust Administrator shall prepare and file a Form 15 Suspension
Notification relating to the automatic suspension of reporting in respect of the Trust under the
Exchange Act.
In the event that the Trust Administrator is unable to timely file with the Commission
all or any required portion of any Form 8-K, 10-D or 10-K required to be filed by this Agreement because
required disclosure information was either not delivered to it or delivered to it after the delivery
deadlines set forth in this Agreement or for any other reason, the Trust Administrator shall promptly
notify electronically the Depositor. In the case of Form 10-D and 10-K, the parties to this Agreement
shall cooperate to prepare and file a Form 12b-25 and a 10-D/A and 10-K/A as applicable, pursuant to
Rule 12b-25 of the Exchange Act. In the case of Form 8-K, the Trust Administrator shall, upon receipt of
all required Form 8-K Disclosure Information and upon the approval and direction of the Depositor,
include such disclosure information on the next Form 10-D. In the event that any previously filed
Form 8-K, 10-D or 10-K needs to be amended in connection with any additional Form 10-D Disclosure (other
than for the purpose of restating the Monthly Report), the Trust Administrator shall electronically
notify the Depositor and such parties shall cooperate to prepare any necessary Form 8-K/A, 10-D/A or
10-K/A. Any Form 15, Form 12b-25 or any amendment to Form 8-K or 10-D shall be signed by a duly
authorized representative of the Master Servicer. Any amendment to Form 10-K shall be signed by the
Depositor. The parties to this Agreement acknowledge that the performance by the Trust Administrator
and the Master Servicer of their duties under this Section 13.05 related to the timely preparation and
filing of Form 15, a Form 12b-25 or any amendment to Form 8-K, 10-D or 10-K is contingent upon each such
party performing its duties under this Section 13.05. Neither the Trust Administrator nor the Master
Servicer shall have any liability for any loss, expense, damage or claim arising out of or with respect
to any failure to properly prepare and/or timely file any such Form 15, Form 12b-25 or any amendments to
Forms 8-K, 10-D or 10-K, where such failure results from the Trust Administrator's inability or failure
to obtain or receive, on a timely basis, any information from any other party hereto needed to prepare,
arrange for execution or file such Form 15, Form 12b-25 or any amendments to Forms 8-K, 10-D or 10-K,
not resulting from its own negligence, bad faith or willful misconduct.
SECTION 13.06. Annual Statements of Compliance
The Master Servicer, the Trust Administrator and each Servicer shall deliver or
otherwise make available (and the Master Servicer, the Trust Administrator and each Servicer shall cause
any Servicing Function Participant engaged by it to deliver or otherwise make available) to the
Depositor, the Trustee and the Trust Administrator on or before March 1 of each year, commencing in
March 2007, an Officer's Certificate (an "Item 1123 Certificate") stating, as to the signer thereof,
that (A) a review of such party's activities during the preceding calendar year or portion thereof and
of such party's performance under this Agreement, or such other applicable agreement in the case of a
Servicing Function Participant, has been made under such officer's supervision and (B) to the best of
such officer's knowledge, based on such review, such party has fulfilled all its obligations under this
Agreement, or such other applicable agreement in the case of a Servicing Function Participant, in all
material respects throughout such year or 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. Promptly after receipt of each such Item 1123 Certificate, the Depositor
shall review such Item 1123 Certificate and, if applicable, consult with each such party, as applicable,
as to the nature of any failures by such party, in the fulfillment of any of such party's obligations
hereunder or, in the case of an Additional Servicer, under such other applicable agreement, provided,
however, that Xxxxx Fargo, in its capacity as a Servicer, shall only be obligated to provide the
Item 1123 Officer's Certificate to the Master Servicer and the Master Servicer shall forward such 1123
Officer's Certificate to the Depositor, the Trustee and the Trust Administrator or, if there is no
Master Servicer, to the Depositor and the Depositor shall forward such 1123 Officer's Certificate to the
Trustee and the Trust Administrator.
The Master Servicer shall include all annual statements of compliance received by it
from each Servicer with its own annual statement of compliance to be submitted to the Trust
Administrator pursuant to this Section 13.06.
In the event the Master Servicer, the Trust Administrator or any Servicing Function
Participant engaged by any such party is terminated or resigns pursuant to the terms of this Agreement,
or any applicable agreement in the case of a Servicing Function Participant, as the case may be, such
party shall provide an Item 1123 Certificate pursuant to this Section 13.06 or to such applicable
agreement, as the case may be, notwithstanding any such termination, assignment or resignation.
The Master Servicer shall enforce any obligation of any Designated Servicer, to the
extent set forth in the related Designated Servicing Agreement, to deliver to the Master Servicer an
Item 1123 Certificate as may be required pursuant to the related Designated Servicing Agreement. The
Master Servicer shall include such Item 1123 Certificate with its own Item 1123 Certificate to be
submitted to the Trust Administrator, the Depositor and the Trustee pursuant to this Section 13.06.
SECTION 13.07. Annual Assessments of Compliance.
By March 1 of each year, commencing in March 2007, the Master Servicer, the Trust
Administrator and each Servicer, each at its own expense, shall furnish or otherwise make available, and
each such party shall cause any Servicing Function Participant engaged by it to furnish or otherwise
make available, each at its own expense, to the Trust Administrator, the Trustee and the Depositor, a
report on an assessment of compliance with the Relevant Servicing Criteria (an "Assessment of
Compliance") that contains (A) a statement by such party of its responsibility for assessing compliance
with the Relevant Servicing Criteria for each party as set forth on Exhibit R, (B) a statement that such
party used the Relevant Servicing Criteria to assess compliance with the Relevant Servicing Criteria,
(C) such party's assessment of compliance with the Relevant Servicing Criteria as of and for the fiscal
year covered by the Form 10-K required to be filed pursuant to Section 13.03, including, if there has
been any material instance of noncompliance with the Relevant Servicing Criteria, a discussion of each
such failure and the nature and status thereof, and (D) a statement that a registered public accounting
firm has issued an Accountant's Attestation on such party's Assessment of Compliance with the Relevant
Servicing Criteria as of and for such period.
No later than the end of each fiscal year for the Trust for which a 10-K is required
to be filed, each Servicer and the Master Servicer shall each forward to the Trust Administrator the
name of each Servicing Function Participant engaged by it and what Relevant Servicing Criteria will be
addressed in the Assessment of Compliance prepared by such Servicing Function Participant; provided,
however, that the Master Servicer need not provide information to the Trust Administrator so long as the
Master Servicer and the Trust Administrator are the same person. When the Master Servicer and each
Servicer (or any Servicing Function Participant engaged by them) submit their Assessments of Compliance
to the Trust Administrator, such parties shall also at such time include the Assessments of Compliance
(and Accountant's Attestation) pursuant to Section 13.08 of each Servicing Function Participant engaged
by it; provided, however, that Xxxxx Fargo, in its capacity as a Servicer, shall only be obligated to
provide disclosure pursuant to the first and second paragraphs of this Section 13.07 to the Master
Servicer and the Master Servicer shall forward such items to the appropriate parties or, if there is no
Master Servicer, to the Depositor and the Depositor shall forward such items to the Trustee and the
Trust Administrator.
Promptly after receipt of each Assessment of Compliance, the Depositor shall review
each such report and, if applicable, consult with the Master Servicer, the Trust Administrator, each
Servicer and any Servicing Function Participant engaged by such parties as to the nature of any material
instance of noncompliance with the Relevant Servicing Criteria by each such party. None of such parties
shall be required to deliver any such assessments until April 15 in any given year so long as it has
received written confirmation from the Depositor that a Form 10-K is not required to be filed in respect
of the Trust for the preceding calendar year.
The Master Servicer shall include all annual reports on assessment of compliance
received by it from the Servicers with its own assessment of compliance to be submitted to the Trust
Administrator pursuant to this Section 13.07.
In the event the Master Servicer, the Trust Administrator or any Servicing Function
Participant engaged by any such party is terminated, assigns its rights and obligations under, or
resigns pursuant to, the terms of this Agreement, or any other applicable agreement, as the case may be,
such party shall provide a report on assessment of compliance pursuant to this Section 13.07, or such
other applicable agreement, notwithstanding any such termination, assignment of resignation.
The Master Servicer shall enforce any obligation of the Designated Servicers and the
Custodians, to the extent set forth in the related Designated Servicing Agreement or Custodial
Agreement, as applicable, to deliver to the Master Servicer an Assessment of Compliance within the time
frame set forth in, and in such form and substance as may be required pursuant to, the related
Designated Servicing Agreement or Custodial Agreement, as applicable. The Master Servicer shall include
such Assessment of Compliance with its own Assessment of Compliance to be submitted to the Trust
Administrator and the Trustee pursuant to this Section 13.07.
SECTION 13.08. Accountant's Attestation
By March 1 of each year, commencing in 2007, the Master Servicer, the Trust
Administrator and each Servicer, each at its own expense, shall cause, and each such party shall cause
any Servicing Function Participant engaged by it to cause, each at its own expense, a registered public
accounting firm (which may also render other services to the Master Servicer, the Trust Administrator or
a Servicer or such other Servicing Function Participants, as the case may be) and that is a member of
the American Institute of Certified Public Accountants to furnish a report (the "Accountant's
Attestation") to the Trust Administrator and the Depositor, to the effect that (i) it has obtained a
representation regarding certain matters from the management of such party, which includes an assertion
that such party has complied with the Relevant Servicing Criteria, and (ii) on the basis of an
examination conducted by such firm in accordance with standards for attestation engagements issued or
adopted by the PCAOB, it is expressing an opinion as to whether such party's compliance with the
Relevant Servicing Criteria was fairly stated in all material respects, or it cannot express an overall
opinion regarding such party's assessment of compliance with the Relevant Servicing Criteria. In the
event that an overall opinion cannot be expressed, such registered public accounting firm shall state in
such report why it was unable to express such an opinion. Such report must be available for general use
and not contain restricted use language.
Promptly after receipt of such Accountant's Attestations from the Master Servicer,
each Servicer, each Designated Servicer, each Custodian, the Trust Administrator or any Servicing
Function Participant engaged by such parties, (i) the Depositor shall review the report and, if
applicable, consult with such parties as to the nature of any defaults by such parties, in the
fulfillment of any of each such party's obligations hereunder or under any other applicable agreement,
and (ii) the Trust Administrator shall confirm that each Assessment of Compliance is coupled with an
Accountant's Attestation meeting the requirements of this Section 13.08 and notify the Depositor of any
exceptions. None of such parties shall be required to deliver any such assessments until April 15 in any
given year so long as it has received written confirmation from the Depositor that a Form 10-K is not
required to be filed in respect of the Trust for the preceding calendar year.
The Master Servicer shall include each such attestation furnished to it by the
Servicers with its own attestation to be submitted to the Trust Administrator pursuant to this
Section 13.08.
In the event the Master Servicer, the Trust Administrator, the Custodians, any
Servicer or any Servicing Function Participant engaged by any such party, is terminated, assigns its
rights and duties under, or resigns pursuant to the terms of, this Agreement, or any applicable
Custodial Agreement, Servicing Agreement or sub-servicing agreement, as the case may be, such party
shall, at its sole expense, cause a registered public accounting firm to provide an attestation pursuant
to this Section 13.08, or such other applicable agreement, notwithstanding any such termination,
assignment or resignation.
The Master Servicer shall enforce any obligation of the Designated Servicers and the
Custodians, to the extent set forth in the related Designated Servicing Agreement and the related
Custodial Agreement, as applicable, to deliver to the Master Servicer an attestation as may be required
pursuant to, the related Designated Servicing Agreement or Custodial Agreement as applicable. The
Master Servicer shall include each such attestation with its own Accountant's Attestation to be
submitted to the Trust Administrator pursuant to this Section 13.08.
SECTION 13.09. Xxxxxxxx-Xxxxx Certification
Each Form 10-K shall include a certification (the "Xxxxxxxx-Xxxxx Certification")
required to be included therewith pursuant to the Xxxxxxxx-Xxxxx Act. Each Servicer, the Master
Servicer and the Trust Administrator shall provide, and each Servicer, the Master Servicer and the Trust
Administrator shall cause any Servicing Function Participant engaged by it to, provide to the Person who
signs the Xxxxxxxx-Xxxxx Certification (the "Certifying Person"), by March 1 of each year in which the
Trust is subject to the reporting requirements of the Exchange Act and otherwise within a reasonable
period of time upon request, a certification (each, a "Back-Up Certification"), in the form attached
hereto as Exhibit V, upon 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 Depositor shall serve as the Certifying
Person on behalf of the Trust. In the event the Master Servicer, the Trust Administrator or any
Servicing Function Participant engaged by such party is terminated or resigns pursuant to the terms of
this Agreement, or any applicable Subservicing Agreement, as the case may be, such party shall provide a
Back-Up Certification to the Certifying Person pursuant to this Section 13.09 with respect to the period
of time it was subject to this Agreement or any applicable Subservicing Agreement, as the case may be.
The Master Servicer shall enforce any obligation of the Designated Servicers, to the
extent set forth in the related Designated Servicing Agreement, to deliver to the Master Servicer a
certification similar to the Back-Up Certification as may be required pursuant to the related Designated
Servicing Agreement.
SECTION 13.10. Indemnification
Each party required to deliver an Assessment of Compliance and an Accountant's
Attestation and/or an Item 1123 Certification under Article XIII (each, a "Responsible Party) shall
indemnify and hold harmless the Trust Administrator, the Master Servicer and the Depositor and each of
their directors, officers, employees, agents, and affiliates from and against any and all claims,
losses, damages, penalties, fines, forfeitures, reasonable legal fees and related costs, judgments and
other costs and expenses arising out of or based upon (a) any breach by such Responsible Party of any if
its obligations under this Article XIII including particularly its obligation to provide any Assessment
of Compliance and an Accountant's Attestation and/or an Item 1123 Certification or any information, data
or material required to be included in any Exchange Act report, (b) any misstatement or omission in any
information, data or materials provided by such Responsible Party (or, in the case of the Trust
Administrator or Master Servicer, any material misstatement of material omission in (i) any Compliance
Statement, Assessment of Compliance or Attestation report delivered by it, or by any Servicing Function
Participant engaged by it, pursuant to this Agreement, or (ii) any Additional Form 10-D Disclosure or
Additional Form 10-K Disclosure concerning the Master Servicer or the Trust Administrator, or (c) the
negligence, bad faith or willful misconduct of such Responsible Party in connection with the performance
of any if its obligations hereunder. If the indemnification provided for herein is unavailable or
insufficient to hold harmless the Master Servicer, the Trust Administrator or the Depositor, then each
Responsible Party agrees that it shall contribute to the amount paid or payable by the Trust
Administrator, the Master Servicer or the Depositor, as applicable, as a result of any claims, losses,
damages or liabilities incurred by the Master Servicer, the Trust Administrator or the Depositor, as
applicable, in such proportion as is appropriate to reflect the relative fault of the Master Servicer,
the Trust Administrator or the Depositor, as applicable, on the one hand and such Responsible Party, on
the other. This indemnification shall survive the termination of this Agreement or the termination of
any party to this Agreement.
IN WITNESS WHEREOF, the Depositor, the Seller, the Trust Administrator, the Master
Servicer, the Trustee, the Special Servicer and the Servicers have caused their names to be signed
hereto by their respective officers thereunto duly authorized all as of the date first written above.
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES
CORP.,
as Depositor
By:______________________________________
Name:
Title:
DLJ MORTGAGE CAPITAL, INC.,
as Seller
By:______________________________________
Name:
Title:
XXXXX FARGO BANK, N.A.,
as Trust Administrator and as Master Servicer
By:______________________________________
Name:
Title:
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:______________________________________
Name:
Title:
XXXXX FARGO BANK, N.A.,
as a Servicer
By:______________________________________
Name:
Title:
GREENPOINT MORTGAGE FUNDING, INC.,
as a Servicer
By:______________________________________
Name:
Title:
SELECT PORTFOLIO SERVICING, INC.,
as a Servicer and Special Servicer
By:______________________________________
Name:
Title:
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
On this __ day of July, 2006, before me, personally appeared _____________, known to me to be a Vice
President of Credit Suisse First Boston Mortgage Securities Corp., one of the corporations that executed
the within instrument, and also known to me to be the person who executed it on behalf of said
corporation, and acknowledged to me that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this
certificate first above written.
Notary Public
[NOTARIAL SEAL]
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
On the __ day of July, 2006, before me, personally appeared ____________, known to me to be a Vice
President of DLJ Mortgage Capital, Inc., one of the corporations that executed the within instrument and
also known to me to be the person who executed it on behalf of said corporation, and acknowledged to me
that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this
certificate first above written.
Notary Public
[NOTARIAL SEAL]
STATE OF )
: ss.:
COUNTY OF )
On the _____ day of July, 2006 before me, a Notary Public in and for said State, personally appeared
____________________, known to me to be a __________________ of GreenPoint Mortgage Funding, Inc., the
company that executed the within instrument and also known to me to be the person who executed it on
behalf of said company, and acknowledged to me that such banking corporation executed the within
instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this
certificate first above written.
Notary Public
_________________________________________
[NOTARIAL SEAL]
STATE OF _____________)
: ss.:
COUNTY OF _____________)
On the _____ day of July, 2006 before me, a Notary Public in and for said State, personally appeared
____________________, known to me to be a __________________ of SPS, the Utah corporation that executed
the within instrument and also known to me to be the person who executed it on behalf of said
corporation, and acknowledged to me that such limited partnership executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this
certificate first above written.
Notary Public
[NOTARIAL SEAL]
STATE OF )
: ss.:
COUNTY OF )
On the _____ day of July, 2006 before me, a Notary Public in and for said State, personally appeared
____________________, known to me to be a __________________ of Xxxxx Fargo Bank, N.A., the national
banking association that executed the within instrument and also known to me to be the person who
executed it on behalf of said national banking association, and acknowledged to me that such banking
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this
certificate first above written.
Notary Public
[NOTARIAL SEAL]
STATE OF )
: ss.:
COUNTY OF )
On the _____ day of July, 2006 before me, a Notary Public in and for said State, personally appeared
____________________, known to me to be a __________________ of Xxxxx Fargo Bank, N.A., the national
banking association that executed the within instrument and also known to me to be the person who
executed it on behalf of said national banking association, and acknowledged to me that such banking
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this
certificate first above written.
Notary Public
[NOTARIAL SEAL]
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
On the _____ day of July, 2006 before me, a Notary Public in and for said State, personally appeared
____________________, known to me to be a __________________ of U.S. Bank National Association, the
national banking association that executed the within instrument and also known to me to be the person
who executed it on behalf of said national banking association, and acknowledged to me that such
national banking association executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this
certificate first above written.
Notary Public
[NOTARIAL SEAL]
EXHIBIT A
FORM OF CLASS A CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS OWNERSHIP OF A “REGULAR INTEREST” IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”).
|
A-1 |
Certificate No. :1
|
Cut-off Date |
: |
July 1, 2006 |
|
|
First Distribution Date |
: |
August 25, 2006 | |
Initial Certificate Balance
of this Certificate
|
(“Denomination”) |
: |
Initial Certificate Balances
of all Certificates
|
of this Class |
: |
| ||
|
CUSIP |
: |
| ||
|
Pass-Through Rate |
: |
Variable |
| |
|
Maturity Date |
: |
August 2036 | ||
|
A-2 |
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
Credit Suisse First Boston Mortgage Securities Corp.,
Adjustable Rate Mortgage-Backed Pass-Through Certificates, Series 2006-3
Class [__]-A-[__]
evidencing a percentage interest in the distributions allocable to the Certificates of the above-referenced Class with respect to a Trust Fund consisting primarily of a pool of adjustable rate conventional mortgage loans (the “Mortgage Loans”) secured by first liens on one- to four-family residential properties.
Credit Suisse First Boston Mortgage Securities Corp., as Depositor
Principal in respect of this Certificate is distributable monthly as set forth herein. Accordingly, the Certificate Balance at any time may be less than the Certificate Balance as set forth herein. This Certificate does not evidence an obligation of, or an interest in, and is not guaranteed by the Depositor, the Seller, the Master Servicer, the Servicers, the Special Servicer, the Trust Administrator or the Trustee referred to below or any of their respective affiliates. Neither this Certificate nor the Mortgage Loans are guaranteed or insured by any governmental agency or instrumentality.
This certifies that CEDE & CO., is the registered owner of the Percentage Interest evidenced by this Certificate (obtained by dividing the denomination of this Certificate by the aggregate of the denominations of all Certificates of the Class to which this Certificate belongs) in certain monthly distributions with respect to a Trust Fund consisting primarily of the Mortgage Loans deposited by Credit Suisse First Boston Mortgage Securities Corp. (the “Depositor”). The Trust Fund was created pursuant to a Pooling and Servicing Agreement dated as of the Cut-off Date specified above (the “Agreement”) among Credit Suisse First Boston Mortgage Securities Corp., as depositor, DLJ Mortgage Capital, Inc., as seller, Xxxxx Fargo Bank, N.A., as trust administrator, master servicer and servicer, U.S. Bank National Association, as trustee, and Select Portfolio Servicing, Inc., as a servicer and as special servicer. To the extent not defined herein, the capitalized terms used herein have the meanings assigned in the Agreement. This Certificate is issued under and is subject to the terms, provisions and conditions of the Agreement, to which Agreement the Holder of this Certificate by virtue of the acceptance hereof assents and by which such Holder is bound.
Reference is hereby made to the further provisions of this Certificate set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement or be valid for any purpose unless manually countersigned by an authorized signatory of the Trust Administrator.
|
A-3 |
IN WITNESS WHEREOF, the Trust Administrator has caused this Certificate to be duly executed.
Dated: ___________________
XXXXX FARGO BANK, N.A.
as Trust Administrator
By
Countersigned:
By ___________________________
Authorized Signatory of
XXXXX FARGO BANK, N.A.
as Trust Administrator
|
A-4 |
EXHIBIT B
FORM OF CLASS 4-M CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS OWNERSHIP OF A “REGULAR INTEREST” IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”).
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO CERTAIN CERTIFICATES AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
|
B-1 |
Certificate No. :1
|
Cut-off Date |
: |
July 1, 2006 |
|
|
First Distribution Date |
: |
August 25, 2006 | |
Initial Certificate Balance
of this Certificate
|
(“Denomination”) |
: |
Initial Certificate Balances
of all Certificates
|
of this Class |
: |
|
CUSIP |
: |
| ||
|
Pass-Through Rate |
: |
Variable |
| |
|
Maturity Date |
: |
August 2036 | ||
|
B-2 |
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
Adjustable Rate Mortgage Trust 2006-3,
Adjustable Rate Mortgage-Backed Pass-Through Certificates, Series 2006-3
Class [__]-M-[__]
evidencing a percentage interest in the distributions allocable to the Certificates of the above-referenced Class with respect to a Trust Fund consisting primarily of a pool of adjustable rate conventional mortgage loans (the “Mortgage Loans”) secured by first liens on one- to four-family residential properties.
Credit Suisse First Boston Mortgage Securities Corp., as Depositor
Principal in respect of this Certificate is distributable monthly as set forth herein. Accordingly, the Certificate Balance at any time may be less than the Certificate Balance as set forth herein. This Certificate does not evidence an obligation of, or an interest in, and is not guaranteed by the Depositor, the Seller, the Master Servicer, the Servicers, the Special Servicer, the Trust Administrator or the Trustee referred to below or any of their respective affiliates. Neither this Certificate nor the Mortgage Loans are guaranteed or insured by any governmental agency or instrumentality.
This certifies that CEDE & CO., is the registered owner of the Percentage Interest evidenced by this Certificate (obtained by dividing the denomination of this Certificate by the aggregate of the denominations of all Certificates of the Class to which this Certificate belongs) in certain monthly distributions with respect to a Trust Fund consisting primarily of the Mortgage Loans deposited by Credit Suisse First Boston Mortgage Securities Corp. (the “Depositor”). The Trust Fund was created pursuant to a Pooling and Servicing Agreement dated as of the Cut-off Date specified above (the “Agreement”) among Credit Suisse First Boston Mortgage Securities Corp., as depositor, DLJ Mortgage Capital, Inc., as seller, Xxxxx Fargo Bank, N.A., as trust administrator, master servicer and servicer, U.S. Bank National Association, as trustee, and Select Portfolio Servicing, Inc., as a servicer and as special servicer. To the extent not defined herein, the capitalized terms used herein have the meanings assigned in the Agreement. This Certificate is issued under and is subject to the terms, provisions and conditions of the Agreement, to which Agreement the Holder of this Certificate by virtue of the acceptance hereof assents and by which such Holder is bound.
Reference is hereby made to the further provisions of this Certificate set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement or be valid for any purpose unless manually countersigned by an authorized signatory of the Trust Administrator.
|
B-3 |
IN WITNESS WHEREOF, the Trust Administrator has caused this Certificate to be duly executed.
Dated: __________________
XXXXX FARGO BANK, N.A.
as Trust Administrator
By
Countersigned:
By ___________________________
Authorized Signatory of
XXXXX FARGO BANK, N.A.
as Trust Administrator
|
B-4 |
EXHIBIT C
FORM OF CLASS [__]-B CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS OWNERSHIP OF A “REGULAR INTEREST” IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”).
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO CERTAIN CERTIFICATES AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
[THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (“THE ACT”). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT REGISTRATION THEREOF UNDER THE ACT MAY ONLY BE MADE IN A TRANSACTION EXEMPTED FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.]
PURSUANT TO SECTION 6.02(f) OF THE AGREEMENT, AN ERISA-RESTRICTED CERTIFICATE OR ANY INTEREST HEREIN MAY NOT BE TRANSFERRED UNLESS THE TRANSFEREE DELIVERS TO THE TRUSTEE (I) A REPRESENTATION LETTER TO THE EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”) OR SECTION 4975 OF THE CODE OR A PERSON USING THE ASSETS OF SUCH A PLAN OR ARRANGEMENT OR (II) IF THE PURCHASER IS AN INSURANCE COMPANY AND THE CERTIFICATE HAS BEEN THE SUBJECT OF AN ERISA-QUALIFYING UNDERWRITING, A REPRESENTATION IN ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN OR (III) AN OPINION OF COUNSEL IN ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN. IN THE EVENT THE REPRESENTATIONS REFERRED TO IN THE PRECEDING SENTENCE ARE NOT FURNISHED, SUCH REPRESENTATION SHALL BE DEEMED TO HAVE BEEN MADE TO THE TRUSTEE BY THE TRANSFEREE’S ACCEPTANCE OF THIS CERTIFICATE, OR BY ANY BENEFICIAL OWNER WHO PURCHASES AN INTEREST IN THIS CERTIFICATE IN BOOK-ENTRY FORM. IN THE EVENT THAT A REPRESENTATION IS VIOLATED, OR ANY ATTEMPT TO TRANSFER THIS CERTIFICATE TO A PLAN OR ARRANGEMENT OR PERSON USING A PLAN’S OR ARRANGEMENT’S ASSETS IS ATTEMPTED WITHOUT THE DELIVERY TO THE TRUSTEE OF THE OPINION OF COUNSEL DESCRIBED ABOVE, THE ATTEMPTED TRANSFER OR ACQUISITION OF THIS CERTIFICATE SHALL BE VOID AND OF NO EFFECT.
|
C-1 |
Certificate No. :1
|
Cut-off Date |
: |
July 1, 2006 |
|
|
First Distribution Date |
: |
August 25, 2006 | |
Initial Certificate Balance
of this Certificate
|
(“Denomination”) |
: |
Initial Certificate Balances
of all Certificates
|
of this Class |
: |
|
Percentage Interest |
: |
100% |
| ||
|
CUSIP |
: |
| |||
|
Pass-Through Rate |
: |
Variable |
| ||
|
Maturity Date |
: |
August 2036 | |||
|
C-2 |
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
Adjustable Rate Mortgage Trust 2006-3,
Adjustable Rate Mortgage-Backed Pass-Through Certificates, Series 2006-3
Class [__]-B-[__]
evidencing a percentage interest in the distributions allocable to the Certificates of the above-referenced Class with respect to a Trust Fund consisting primarily of a pool of adjustable rate conventional mortgage loans (the “Mortgage Loans”) secured by first liens on one- to four-family residential properties.
Credit Suisse First Boston Mortgage Securities Corp., as Depositor
This Certificate does not evidence an obligation of, or an interest in, and is not guaranteed by the Depositor, the Seller, the Master Servicer, the Servicers, the Special Servicer, the Trustee or the Trust Administrator referred to below or any of their respective affiliates. Neither this Certificate nor the Mortgage Loans are guaranteed or insured by any governmental agency or instrumentality.
This certifies that [_____________________________________________], is the registered owner of the Percentage Interest evidenced by this Certificate (obtained by dividing the denomination of this Certificate by the aggregate of the denominations of all Certificates of the Class to which this Certificate belongs) in certain monthly distributions with respect to a Trust Fund consisting primarily of the Mortgage Loans deposited by Credit Suisse First Boston Mortgage Securities Corp. (the “Depositor”). The Trust Fund was created pursuant to a Pooling and Servicing Agreement dated as of the Cut-off Date specified above (the “Agreement”) among Credit Suisse First Boston Mortgage Securities Corp., as depositor, DLJ Mortgage Capital, Inc., as seller, Xxxxx Fargo Bank, N.A., as trust administrator, master servicer and servicer, U.S. Bank National Association, as trustee, and Select Portfolio Servicing, Inc., as a servicer and as special servicer. To the extent not defined herein, the capitalized terms used herein have the meanings assigned in the Agreement. This Certificate is issued under and is subject to the terms, provisions and conditions of the Agreement, to which Agreement the Holder of this Certificate by virtue of the acceptance hereof assents and by which such Holder is bound.
[For Privately Offered Certs only] [No transfer of this 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 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 Trust Administrator in writing the facts surrounding the transfer and (i) deliver a letter in substantially the form of either Exhibit L and either (A) Exhibit M 1, provided that all of the Certificates of the Class shall be transferred to one investor or the Depositor otherwise consents to such transfer, or (B) Exhibit M-2 or (ii) there shall be delivered to the Trust Administrator 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 Holder hereof desiring to affect such transfer shall, and does hereby agree to, indemnify the Trustee, the Trust Administrator and the Depositor against any liability that may result if the transfer is not so exempt or is not made in accordance with such federal and state laws.]
Pursuant to Section 6.02(f) of the Agreement, no transfer of an ERISA-Restricted Certificate shall be made unless the Trustee shall have received either (i) a representation letter from the transferee of such ERISA-Restricted Certificate, acceptable to and in form and substance satisfactory to the Trust Administrator, to the effect that such transferee is not an employee benefit plan or arrangement subject to
|
C-3 |
Section 406 of ERISA or Section 4975 of the Code, or a person using the assets of any such plan or arrangement which representation letter shall not be an expense of the Trustee, the Trust Administrator or the Trust Fund, (ii) if the purchaser is an insurance company and the ERISA-Restricted Certificate has been the subject of an ERISA-Qualifying Underwriting, a representation that the purchaser is an insurance company which is purchasing such Certificates with funds contained in an “insurance company general account” (as such term is defined in Section V(e) of Prohibited Transaction Class Exemption 95-60 (“PTCE 95-60”)) and that the purchase and holding of such Certificate are covered under Sections I and III of PTCE 95-60 or (iii) in the case of any such ERISA-Restricted Certificate presented for registration in the name of an employee benefit plan subject to ERISA or Section 4975 of the Code (or comparable provisions of any subsequent enactments), or a person using such plan’s or arrangement’s assets, an Opinion of Counsel satisfactory to the Trust Administrator to the effect that the purchase or holding of such Certificate will not result in prohibited transactions under Section 406 of ERISA and/or Section 4975 of the Code and will not subject the Depositor, the Trustee, the Trust Administrator, the Master Servicer or any other Servicer to any obligation in addition to those undertaken in this Agreement, which Opinion of Counsel shall not be an expense of such parties or the Trust Fund. In the event the representations referred to in the preceding sentence are not furnished, such representation shall be deemed to have been made to the trustee by the transferee’s acceptance of an ERISA-Restricted Certificate or by any beneficial owner who purchases an interest in this certificate in book-entry form. In the event that a representation is violated, or any attempt to transfer an ERISA-Restricted Certificate to a plan or arrangement or person using a plan’s or arrangement’s assets is attempted without the delivery to the Trustee of the Opinion of Counsel described above, the attempted transfer or acquisition of this certificate shall be void and of no effect.
Reference is hereby made to the further provisions of this Certificate set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement or be valid for any purpose unless manually countersigned by an authorized signatory of the Trust Administrator.
|
C-4 |
IN WITNESS WHEREOF, the Trust Administrator has caused this Certificate to be duly executed.
Dated: __________________
XXXXX FARGO BANK, N.A.
as Trust Administrator
By
Countersigned:
By ___________________________
Authorized Signatory of
XXXXX FARGO BANK, N.A.
as Trust Administrator
|
C-5 |
EXHIBIT D-1
FORM OF CLASS AR CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS OWNERSHIP OF “RESIDUAL INTERESTS” ISSUED BY “REAL ESTATE MORTGAGE INVESTMENT CONDUITS,” AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”).
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE PROPOSED TRANSFEREE DELIVERS TO THE TRUST ADMINISTRATOR A TRANSFEREE AFFIDAVIT IN ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE TRANSFEREE DELIVERS TO THE TRUST ADMINISTRATOR A REPRESENTATION LETTER TO THE EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”) OR ARRANGEMENT, OR SECTION 4975 OF THE CODE OR A PERSON USING THE ASSETS OF SUCH A PLAN OR ARRANGEMENT. NOTWITHSTANDING ANYTHING ELSE TO THE CONTRARY HEREIN, ANY PURPORTED TRANSFER OF THIS CERTIFICATE TO OR ON BEHALF OF AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO ERISA OR TO THE CODE SHALL BE VOID AND OF NO EFFECT.
|
|
D-1-1 |
Certificate No. :1
|
Cut-off Date |
: |
July 1, 2006 |
|
|
First Distribution Date |
: |
August 25, 2006 | |
Initial Certificate Balance
of this Certificate
|
(“Denomination”) |
: |
Initial Certificate Balances
of all Certificates
|
of this Class |
: |
|
CUSIP |
: |
| ||
|
Pass-Through Rate |
: |
Variable |
| |
|
Maturity Date |
: |
August 2036 | ||
|
|
D-1-2 |
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
Adjustable Rate Mortgage Trust 2006-3,
Adjustable Rate Mortgage-Backed Pass-Through Certificates, Series 2006-3
Class AR
evidencing a percentage interest in the distributions allocable to the Class AR Certificates with respect to a Trust Fund consisting primarily of a pool of adjustable rate conventional mortgage loans (the “Mortgage Loans”) secured by first liens on one- to four-family residential properties.
Credit Suisse First Boston Mortgage Securities Corp., as Depositor
Principal in respect of this Certificate is distributable monthly as set forth herein. Accordingly, the Certificate Balance at any time may be less than the Certificate Balance as set forth herein. This Certificate does not evidence an obligation of, or an interest in, and is not guaranteed by the Depositor, the Seller, the Master Servicer, the Servicers, the Special Servicer, the Trustee or the Trust Administrator referred to below or any of their respective affiliates. Neither this Certificate nor the Mortgage Loans are guaranteed or insured by any governmental agency or instrumentality.
This certifies that Credit Suisse Securities (USA) LLC, is the registered owner of the Percentage Interest evidenced by this Certificate (obtained by dividing the denomination of this Certificate by the aggregate of the denominations of all Certificates of the Class to which this Certificate belongs) in certain monthly distributions with respect to a Trust Fund consisting primarily of the Mortgage Loans deposited by Credit Suisse First Boston Mortgage Securities Corp. (the “Depositor”). The Trust Fund was created pursuant to a Pooling and Servicing Agreement dated as of the Cut-off Date specified above (the “Agreement”) among Credit Suisse First Boston Mortgage Securities Corp., as depositor, DLJ Mortgage Capital, Inc., as seller, Xxxxx Fargo Bank, N.A., as trust administrator, master servicer and servicer, U.S. Bank National Association, as trustee, and Select Portfolio Servicing, Inc., as a servicer and as special servicer. To the extent not defined herein, the capitalized terms used herein have the meanings assigned in the Agreement. This Certificate is issued under and is subject to the terms, provisions and conditions of the Agreement, to which Agreement the Holder of this Certificate by virtue of the acceptance hereof assents and by which such Holder is bound.
Any distribution of the proceeds of any remaining assets of the Trust Fund will be made only upon presentment and surrender of this Class AR Certificate at the Corporate Trust Office or the office or agency maintained by the Trust Administrator in New York, New York.
Pursuant to the Agreement, no transfer of this Residual Certificate shall be made unless the Trust Administrator shall have received a representation letter from the transferee of such Certificate, acceptable to and in form and substance satisfactory to the Trust Administrator, to the effect that such transferee is not an employee benefit plan or arrangement subject to Section 406 of ERISA or Section 4975 of the Code, or a person using the assets of any such plan or arrangement which representation letter shall not be an expense of the Trustee, the Trust Administrator or the Trust Fund. In the event the representations referred to in the preceding sentence are not furnished, such representation shall be deemed to have been made to the Trust Administrator by the transferee’s acceptance of this Residual Certificate or by any beneficial owner who purchases an interest in this Certificate in book-entry form. In the event that a representation is violated, or any attempt to transfer this Residual Certificate to a plan or arrangement or person using a plan’s or arrangement’s assets is attempted, the attempted transfer or acquisition of this Certificate shall be void and of no effect.
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D-1-3 |
Each Holder of this Class AR Certificate will be deemed to have agreed to be bound by the restrictions of the Agreement, including but not limited to the restrictions that (i) each person holding or acquiring any Ownership Interest in this Class AR Certificate must be a Permitted Transferee, (ii) no Ownership Interest in this Class AR Certificate may be transferred without delivery to the Trust Administrator of a transfer affidavit of the initial owner or the proposed transferee in the form described in the Agreement, (iii) each person holding or acquiring any Ownership Interest in this Class AR Certificate must agree to require a transferee affidavit from any other person to whom such person attempts to transfer its Ownership Interest in this Class AR Certificate as required pursuant to the Agreement, (iv) each person holding or acquiring an Ownership Interest in this Class AR Certificate must agree not to transfer an Ownership Interest in this Class AR Certificate if it has actual knowledge that the proposed transferee is not a Permitted Transferee and (v) any attempted or purported transfer of any Ownership Interest in this Class AR Certificate in violation of such restrictions will be absolutely null and void and will vest no rights in the purported transferee.
Reference is hereby made to the further provisions of this Certificate set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement or be valid for any purpose unless manually countersigned by an authorized signatory of the Trust Administrator.
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D-1-4 |
IN WITNESS WHEREOF, the Trust Administrator has caused this Certificate to be duly executed.
Dated: __________________
XXXXX FARGO BANK, N.A.
as Trust Administrator
By
Countersigned:
By ___________________________
Authorized Signatory of
XXXXX FARGO BANK, N.A.
as Trust Administrator
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D-1-5 |
EXHIBIT D-2
FORM OF CLASS AR-L CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “RESIDUAL INTEREST” IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”).
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE PROPOSED TRANSFEREE DELIVERS TO THE TRUST ADMINISTRATOR A TRANSFEREE AFFIDAVIT IN ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE TRANSFEREE DELIVERS TO THE TRUST ADMINISTRATOR A REPRESENTATION LETTER TO THE EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO SECTION 406 OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”) OR ARRANGEMENT, OR SECTION 4975 OF THE CODE OR A PERSON USING THE ASSETS OF SUCH A PLAN OR ARRANGEMENT. NOTWITHSTANDING ANYTHING ELSE TO THE CONTRARY HEREIN, ANY PURPORTED TRANSFER OF THIS CERTIFICATE TO OR ON BEHALF OF AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO ERISA OR TO THE CODE SHALL BE VOID AND OF NO EFFECT.
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|
D-2-1 |
Certificate No. :1
|
Cut-off Date |
: |
July 1, 2006 |
|
|
First Distribution Date |
: |
August 25, 2006 | |
Initial Certificate Balance
of this Certificate
|
(“Denomination”) |
: |
Initial Certificate Balances
of all Certificates
|
of this Class |
: |
|
CUSIP |
: |
| ||
|
Pass-Through Rate |
: |
Variable |
| |
|
Maturity Date |
: |
August 2036 | ||
|
|
D-2-2 |
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
Adjustable Rate Mortgage Trust 2006-3,
Adjustable Rate Mortgage-Backed Pass-Through Certificates, Series 2006-3
Class AR-L
evidencing a percentage interest in the distributions allocable to the Class AR-L Certificates with respect to a Trust Fund consisting primarily of a pool of fixed rate conventional mortgage loans (the “Mortgage Loans”) secured by first liens on one- to four-family residential properties.
Credit Suisse First Boston Mortgage Securities Corp., as Depositor
Principal in respect of this Certificate is distributable monthly as set forth herein. Accordingly, the Certificate Balance at any time may be less than the Certificate Balance as set forth herein. This Certificate does not evidence an obligation of, or an interest in, and is not guaranteed by the Depositor, the Seller, the Master Servicer, the Servicer, the Trustee or the Trust Administrator referred to below or any of their respective affiliates. Neither this Certificate nor the Mortgage Loans are guaranteed or insured by any governmental agency or instrumentality.
This certifies that [__________________________________], is the registered owner of the Percentage Interest evidenced by this Certificate (obtained by dividing the denomination of this Certificate by the aggregate of the denominations of all Certificates of the Class to which this Certificate belongs) in certain monthly distributions with respect to a Trust Fund consisting primarily of the Mortgage Loans deposited by Credit Suisse First Boston Mortgage Securities Corp. (the “Depositor”). The Trust Fund was created pursuant to a Pooling and Servicing Agreement dated as of the Cut-off Date specified above (the “Agreement”) among Credit Suisse First Boston Mortgage Securities Corp., as depositor, DLJ Mortgage Capital, Inc., as seller, Xxxxx Fargo Bank, N.A., as trust administrator, master servicer and servicer, U.S. Bank National Association, as trustee, and Select Portfolio Servicing, Inc., as a servicer and as special servicer. To the extent not defined herein, the capitalized terms used herein have the meanings assigned in the Agreement. This Certificate is issued under and is subject to the terms, provisions and conditions of the Agreement, to which Agreement the Holder of this Certificate by virtue of the acceptance hereof assents and by which such Holder is bound.
Any distribution of the proceeds of any remaining assets of the Trust Fund will be made only upon presentment and surrender of this Class AR-L Certificate at the Corporate Trust Office or the office or agency maintained by the Trust Administrator in New York, New York.
Pursuant to the Agreement, no transfer of this Residual Certificate shall be made unless the Trust Administrator shall have received a representation letter from the transferee of such Certificate, acceptable to and in form and substance satisfactory to the Trust Administrator, to the effect that such transferee is not an employee benefit plan or arrangement subject to Section 406 of ERISA or Section 4975 of the Code, or a person using the assets of any such plan or arrangement which representation letter shall not be an expense of the Trustee, the Trust Administrator or the Trust Fund. In the event the representations referred to in the preceding sentence are not furnished, such representation shall be deemed to have been made to the Trust Administrator by the transferee’s acceptance of this Residual Certificate or by any beneficial owner who purchases an interest in this Certificate in book-entry form. In the event that a representation is violated, or any attempt to transfer this Residual Certificate to a plan or arrangement or person using a plan’s or arrangement’s assets is attempted, the attempted transfer or acquisition of this Certificate shall be void and of no effect.
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D-2-3 |
Each Holder of this Class AR-L Certificate will be deemed to have agreed to be bound by the restrictions of the Agreement, including but not limited to the restrictions that (i) each person holding or acquiring any Ownership Interest in this Class AR-L Certificate must be a Permitted Transferee, (ii) no Ownership Interest in this Class AR-L Certificate may be transferred without delivery to the Trust Administrator of a transfer affidavit of the initial owner or the proposed transferee in the form described in the Agreement, (iii) each person holding or acquiring any Ownership Interest in this Class AR-L Certificate must agree to require a transferee affidavit from any other person to whom such person attempts to transfer its Ownership Interest in this Class AR-L Certificate as required pursuant to the Agreement, (iv) each person holding or acquiring an Ownership Interest in this Class AR-L Certificate must agree not to transfer an Ownership Interest in this Class AR-L Certificate if it has actual knowledge that the proposed transferee is not a Permitted Transferee and (v) any attempted or purported transfer of any Ownership Interest in this Class AR-L Certificate in violation of such restrictions will be absolutely null and void and will vest no rights in the purported transferee.
Reference is hereby made to the further provisions of this Certificate set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement or be valid for any purpose unless manually countersigned by an authorized signatory of the Trust Administrator.
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D-2-4 |
IN WITNESS WHEREOF, the Trust Administrator has caused this Certificate to be duly executed.
Dated: __________________
XXXXX FARGO BANK, N.A.
as Trust Administrator
By
Countersigned:
By ___________________________
Authorized Signatory of
XXXXX FARGO BANK, N.A.
as Trust Administrator
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D-2-5 |
EXHIBIT E
FORM OF CLASS P CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS OWNERSHIP OF A “REGULAR INTEREST” IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”).
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO CERTAIN CERTIFICATES AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (“THE ACT”). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT REGISTRATION THEREOF UNDER THE ACT MAY ONLY BE MADE IN A TRANSACTION EXEMPTED FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.
PURSUANT TO SECTION 6.02(f) OF THE AGREEMENT, NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE TRANSFEREE DELIVERS TO THE TRUST ADMINISTRATOR (I) A REPRESENTATION LETTER TO THE EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”) OR SECTION 4975 OF THE CODE OR A PERSON USING THE ASSETS OF SUCH A PLAN OR ARRANGEMENT, OR (II) IF THE PURCHASER IS AN INSURANCE COMPANY AND THE CERTIFICATE HAS BEEN THE SUBJECT OF AN ERISA-QUALIFYING UNDERWRITING, A REPRESENTATION IN ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN OR (III) AN OPINION OF COUNSEL IN ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN. IN THE EVENT THE REPRESENTATIONS REFERRED TO IN THE PRECEDING SENTENCE ARE NOT FURNISHED, SUCH REPRESENTATION SHALL BE DEEMED TO HAVE BEEN MADE TO THE TRUST ADMINISTRATOR BY THE TRANSFEREE’S ACCEPTANCE OF THIS CERTIFICATE, OR BY ANY BENEFICIAL OWNER WHO PURCHASES AN INTEREST IN THIS CERTIFICATE IN BOOK-ENTRY FORM. IN THE EVENT THAT A REPRESENTATION IS VIOLATED, OR ANY ATTEMPT TO TRANSFER THIS CERTIFICATE TO A PLAN OR ARRANGEMENT OR PERSON ACTING ON BEHALF OF A PLAN OR USING A PLAN’S OR ARRANGEMENT’S ASSETS IS ATTEMPTED WITHOUT THE DELIVERY TO THE TRUST ADMINISTRATOR OF THE OPINION OF COUNSEL DESCRIBED ABOVE, THE ATTEMPTED TRANSFER OR ACQUISITION OF THIS CERTIFICATE SHALL BE VOID AND OF NO EFFECT.
THIS CERTIFICATE HAS NO PRINCIPAL BALANCE AND IS NOT ENTITLED TO ANY DISTRIBUTIONS IN RESPECT OF PRINCIPAL.
|
E-1 |
Certificate No. :P-1
|
Cut-off Date |
: |
July 1, 2006 |
| |||
|
First Distribution Date |
: |
August 25, 2006 | ||||
|
Percentage Interest |
: |
____% |
| |||
|
CUSIP |
: |
| ||||
|
Maturity Date |
: |
August 2036 |
| |||
|
E-2 |
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
Adjustable Rate Mortgage Trust 2006-3,
Adjustable Rate Mortgage-Backed Pass-Through Certificates, Series 2006-3,
Class P
evidencing a 100% Percentage Interest in the distributions allocable to the Class P Certificates with respect to a Trust Fund consisting primarily of a pool of adjustable rate conventional mortgage loans (the “Mortgage Loans”) secured by first liens on one- to four-family residential properties.
Credit Suisse First Boston Mortgage Securities Corp., as Depositor
This Certificate does not evidence an obligation of, or an interest in, and is not guaranteed by the Depositor, the Seller, the Master Servicer, the Servicers, the Special Servicer, the Trustee or the Trust Administrator referred to below or any of their respective affiliates. Neither this Certificate nor the Mortgage Loans are guaranteed or insured by any governmental agency or instrumentality.
This certifies that _____________________________, is the registered owner of the Percentage Interest evidenced by this Certificate (obtained by dividing the denomination of this Certificate by the aggregate of the denominations of all Certificates of the Class to which this Certificate belongs) in certain monthly distributions with respect to a Trust Fund consisting primarily of the Mortgage Loans deposited by Credit Suisse First Boston Mortgage Securities Corp. (the “Depositor”). The Trust Fund was created pursuant to a Pooling and Servicing Agreement dated as of the Cut-off Date specified above (the “Agreement”) among Credit Suisse First Boston Mortgage Securities Corp., as depositor, DLJ Mortgage Capital, Inc., as seller, Xxxxx Fargo Bank, N.A., as trust administrator, master servicer and servicer, U.S. Bank National Association, as trustee, and Select Portfolio Servicing, Inc., as a servicer and as special servicer. To the extent not defined herein, the capitalized terms used herein have the meanings assigned in the Agreement. This Certificate is issued under and is subject to the terms, provisions and conditions of the Agreement, to which Agreement the Holder of this Certificate by virtue of the acceptance hereof assents and by which such Holder is bound.
No transfer of this 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 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 Trust Administrator in writing the facts surrounding the transfer and (i) deliver a letter in substantially the form of either Exhibit L and either (A) Exhibit M-1, provided that all of the Certificates of the Class shall be transferred to one investor or the Depositor otherwise consents to such transfer, or (B) Exhibit M-2 or (ii) there shall be delivered to the Trust Administrator 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 Holder hereof desiring to effect such transfer shall, and does hereby agree to, indemnify the Trustee, the Trust Administrator and the Depositor against any liability that may result if the transfer is not so exempt or is not made in accordance with such federal and state laws.
Pursuant to the Agreement, no transfer of an ERISA-Restricted Certificate shall be made unless the Trust Administrator shall have received either (i) a representation letter from the transferee of such ERISA-Restricted Certificate, acceptable to and in form and substance satisfactory to the Trust Administrator, to the effect that such transferee is not an employee benefit plan or arrangement subject to
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E-3 |
Section 406 of ERISA or Section 4975 of the Code, or a person using the assets of any such plan or arrangement which representation letter shall not be an expense of the Trustee, the Trust Administrator or the Trust Fund, (ii) if the purchaser is an insurance company and the ERISA-Restricted Certificate has been the subject of an ERISA-Qualifying Underwriting, a representation that the purchaser is an insurance company which is purchasing such Certificates with funds contained in an “insurance company general account” (as such term is defined in Section V(e) of Prohibited Transaction Class Exemption 95-60 (“PTCE 95-60”)) and that the purchase and holding of such Certificate are covered under Sections I and III of PTCE 95-60 or (iii) in the case of any such ERISA-Restricted Certificate presented for registration in the name of an employee benefit plan subject to ERISA or Section 4975 of the Code (or comparable provisions of any subsequent enactments), or a person using such plan’s or arrangement’s assets, an Opinion of Counsel satisfactory to the Trust Administrator to the effect that the purchase or holding of such Certificate will not result in prohibited transactions under Section 406 of ERISA and/or Section 4975 of the Code and will not subject the Depositor, the Trustee, the Trust Administrator, the Master Servicer or any other Servicer to any obligation in addition to those undertaken in this Agreement, which Opinion of Counsel shall not be an expense of such parties or the Trust Fund. In the event the representations referred to in the preceding sentence are not furnished, such representation shall be deemed to have been made to the Trust Administrator by the transferee’s acceptance of an ERISA-Restricted Certificate or by any beneficial owner who purchases an interest in this certificate in book-entry form. In the event that a representation is violated, or any attempt to transfer an ERISA-Restricted Certificate to a plan or arrangement or person using a plan’s or arrangement’s assets is attempted without the delivery to the Trust Administrator of the Opinion of Counsel described above, the attempted transfer or acquisition of this certificate shall be void and of no effect.
Reference is hereby made to the further provisions of this Certificate set forth following the signature page hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement or be valid for any purpose unless manually countersigned by an authorized signatory of the Trust Administrator.
On any Distribution Date on which the Stated Principal Balance of Mortgage Loans in such Loan Groups as are specified in the Agreement are less than those percentages set forth in the Agreement, all remaining Mortgage Loans in such Loan Groups and all property acquired in respect of such Mortgage Loans may be purchased as provided in the Agreement. In the event that no such purchase occurs, the obligations and responsibilities created by the Agreement will terminate upon the later of the maturity or other liquidation (or any advance with respect thereto) of the last Mortgage Loan remaining in the Trust Fund or the disposition of all property in respect thereof and the distribution to Certificateholders of all amounts required to be distributed pursuant to the Agreement. In no event, however, will the trust created by the Agreement continue beyond the earlier of (i) the expiration of 21 years from the death of the last survivor of the descendants living at the date of the Agreement of a certain person named in the Agreement or (ii) 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 related Cut-off Date. Any term used herein that is defined in the Agreement shall have the meaning assigned in the Agreement, and nothing herein shall be deemed inconsistent with that meaning.
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E-4 |
IN WITNESS WHEREOF, the Trust Administrator has caused this Certificate to be duly executed.
Dated: _______________________
XXXXX FARGO BANK, N.A.
as Trust Administrator
By
Countersigned:
By ___________________________
Authorized Signatory of
XXXXX FARGO BANK, N.A.
as Trust Administrator
|
E-5 |
EXHIBIT F
FORM OF CLASS [__]-X CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS OWNERSHIP OF A “REGULAR INTEREST” IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”).
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO CERTAIN CERTIFICATES AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (“THE ACT”). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT REGISTRATION THEREOF UNDER THE ACT MAY ONLY BE MADE IN A TRANSACTION EXEMPTED FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.
PURSUANT TO SECTION 6.02(f) OF THE AGREEMENT, NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE TRANSFEREE DELIVERS TO THE TRUST ADMINISTRATOR (I) A REPRESENTATION LETTER TO THE EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”) OR SECTION 4975 OF THE CODE OR A PERSON USING THE ASSETS OF SUCH A PLAN OR ARRANGEMENT, OR (II) IF THE PURCHASER IS AN INSURANCE COMPANY AND THE CERTIFICATE HAS BEEN THE SUBJECT OF AN ERISA-QUALIFYING UNDERWRITING, A REPRESENTATION IN ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN OR (III) AN OPINION OF COUNSEL IN ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN. IN THE EVENT THE REPRESENTATIONS REFERRED TO IN THE PRECEDING SENTENCE ARE NOT FURNISHED, SUCH REPRESENTATION SHALL BE DEEMED TO HAVE BEEN MADE TO THE TRUST ADMINISTRATOR BY THE TRANSFEREE’S ACCEPTANCE OF THIS CERTIFICATE, OR BY ANY BENEFICIAL OWNER WHO PURCHASES AN INTEREST IN THIS CERTIFICATE IN BOOK-ENTRY FORM. IN THE EVENT THAT A REPRESENTATION IS VIOLATED, OR ANY ATTEMPT TO TRANSFER THIS CERTIFICATE TO A PLAN OR ARRANGEMENT OR PERSON ACTING ON BEHALF OF A PLAN OR USING A PLAN’S OR ARRANGEMENT’S ASSETS IS ATTEMPTED WITHOUT THE DELIVERY TO THE TRUSTEE OF THE OPINION OF COUNSEL DESCRIBED ABOVE, THE ATTEMPTED TRANSFER OR ACQUISITION OF THIS CERTIFICATE SHALL BE VOID AND OF NO EFFECT.
THIS CERTIFICATE HAS NO PRINCIPAL BALANCE AND IS NOT ENTITLED TO ANY DISTRIBUTIONS IN RESPECT OF PRINCIPAL.
|
F-1 |
Certificate No. :1
|
Cut-off Date |
: |
July 1, 2006 |
|
|
First Distribution Date |
: |
August 25, 2006 | |
Initial Notional Amount of this
|
Certificate (“Denomination”) |
: |
Initial Class Notional Amount of
|
all Certificates of this Class |
: |
| |||
|
Percentage Interest |
: |
100% |
| ||
|
CUSIP |
: |
| |||
|
Pass-Through Rate |
: |
N/A |
| ||
|
Maturity Date |
: |
August 2036 | |||
|
F-2 |
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
Adjustable Rate Mortgage Trust 2006-3,
Adjustable Rate Mortgage-Backed Pass-Through Certificates, Series 2006-3
Class [__]-X
evidencing a 100% Percentage Interest in the distributions allocable to the Class [__]-X Certificates with respect to a Trust Fund consisting primarily of a pool of adjustable rate conventional mortgage loans (the “Mortgage Loans”) secured by first liens on one- to four-family residential properties.
Credit Suisse First Boston Mortgage Securities Corp., as Depositor
This Certificate does not evidence an obligation of, or an interest in, and is not guaranteed by the Depositor, the Seller, the Master Servicer, the Servicers, the Special Servicer, the Trustee or the Trust Administrator referred to below or any of their respective affiliates. Neither this Certificate nor the Mortgage Loans are guaranteed or insured by any governmental agency or instrumentality.
This certifies that [_____________________________________________], is the registered owner of the Percentage Interest evidenced by this Certificate (obtained by dividing the denomination of this Certificate by the aggregate of the denominations of all Certificates of the Class to which this Certificate belongs) in certain monthly distributions with respect to a Trust Fund consisting primarily of the Mortgage Loans deposited by Credit Suisse First Boston Mortgage Securities Corp. (the “Depositor”). The Trust Fund was created pursuant to a Pooling and Servicing Agreement dated as of the Cut-off Date specified above (the “Agreement”) among Credit Suisse First Boston Mortgage Securities Corp., as depositor, DLJ Mortgage Capital, Inc., as seller, Xxxxx Fargo Bank, N.A., as trust administrator, master servicer and servicer, U.S. Bank National Association, as trustee, and Select Portfolio Servicing, Inc., as a servicer and as special servicer. To the extent not defined herein, the capitalized terms used herein have the meanings assigned in the Agreement. This Certificate is issued under and is subject to the terms, provisions and conditions of the Agreement, to which Agreement the Holder of this Certificate by virtue of the acceptance hereof assents and by which such Holder is bound.
No transfer of this 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 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 Trust Administrator in writing the facts surrounding the transfer and (i) deliver a letter in substantially the form of either Exhibit L and either (A) Exhibit M 1, provided that all of the Certificates of the Class shall be transferred to one investor or the Depositor otherwise consents to such transfer, or (B) Exhibit M 2 or (ii) there shall be delivered to the Trust Administrator 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 Holder hereof desiring to effect such transfer shall, and does hereby agree to, indemnify the Trustee, the Trust Administrator and the Depositor against any liability that may result if the transfer is not so exempt or is not made in accordance with such federal and state laws.
Pursuant to the Agreement, no transfer of an ERISA-Restricted Certificate shall be made unless the Trust Administrator shall have received either (i) a representation letter from the transferee of such ERISA-Restricted Certificate, acceptable to and in form and substance satisfactory to the Trust Administrator, to the effect that such transferee is not an employee benefit plan or arrangement subject to
|
F-3 |
Section 406 of ERISA or Section 4975 of the Code, or a person using the assets of any such plan or arrangement which representation letter shall not be an expense of the Trustee, the Trust Administrator or the Trust Fund, (ii) if the purchaser is an insurance company and the ERISA-Restricted Certificate has been the subject of an ERISA-Qualifying Underwriting, a representation that the purchaser is an insurance company which is purchasing such Certificates with funds contained in an “insurance company general account” (as such term is defined in Section V(e) of Prohibited Transaction Class Exemption 95-60 (“PTCE 95-60”)) and that the purchase and holding of such Certificate are covered under Sections I and III of PTCE 95-60 or (iii) in the case of any such ERISA-Restricted Certificate presented for registration in the name of an employee benefit plan subject to ERISA or Section 4975 of the Code (or comparable provisions of any subsequent enactments), or a person using such plan’s or arrangement’s assets, an Opinion of Counsel satisfactory to the Trust Administrator to the effect that the purchase or holding of such Certificate will not result in prohibited transactions under Section 406 of ERISA and/or Section 4975 of the Code and will not subject the Depositor, the Trustee, the Trust Administrator, the Master Servicer or any other Servicer to any obligation in addition to those undertaken in this Agreement, which Opinion of Counsel shall not be an expense of such parties or the Trust Fund. In the event the representations referred to in the preceding sentence are not furnished, such representation shall be deemed to have been made to the Trust Administrator by the transferee’s acceptance of an ERISA-Restricted Certificate or by any beneficial owner who purchases an interest in this certificate in book-entry form. In the event that a representation is violated, or any attempt to transfer an ERISA-Restricted Certificate to a plan or arrangement or person using a plan’s or arrangement’s assets is attempted without the delivery to the Trust Administrator of the Opinion of Counsel described above, the attempted transfer or acquisition of this certificate shall be void and of no effect.
Reference is hereby made to the further provisions of this Certificate set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement or be valid for any purpose unless manually countersigned by an authorized signatory of the Trust Administrator.
On any Distribution Date on which the Stated Principal Balance of Mortgage Loans in such Loan Groups as are specified in the Agreement are less than those percentages set forth in the Agreement, all remaining Mortgage Loans in such Loan Groups and all property acquired in respect of such Mortgage Loans may be purchased as provided in the Agreement. In the event that no such purchase occurs, the obligations and responsibilities created by the Agreement will terminate upon the later of the maturity or other liquidation (or any advance with respect thereto) of the last Mortgage Loan remaining in the Trust Fund or the disposition of all property in respect thereof and the distribution to Certificateholders of all amounts required to be distributed pursuant to the Agreement. In no event, however, will the trust created by the Agreement continue beyond the earlier of (i) the expiration of 21 years from the death of the last survivor of the descendants living at the date of the Agreement of a certain person named in the Agreement or (ii) 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 related Cut-off Date. Any term used herein that is defined in the Agreement shall have the meaning assigned in the Agreement, and nothing herein shall be deemed inconsistent with that meaning.
|
F-4 |
IN WITNESS WHEREOF, the Trust Administrator has caused this Certificate to be duly executed.
Dated: __________________
XXXXX FARGO BANK, N.A.
as Trust Administrator
By
Countersigned:
By ___________________________
Authorized Signatory of
XXXXX FARGO BANK, N.A.
as Trust Administrator
|
F-5 |
EXHIBIT G
FORM OF REVERSE OF CERTIFICATES
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.
Adjustable Rate Mortgage Trust 2006-3,
Adjustable Rate Mortgage-Backed Pass-Through Certificates, Series 2006-3
Class [__]-[__]-[__]
This Certificate is one of a duly authorized issue of Certificates designated as Credit Suisse First Boston Mortgage Securities Corp., Adjustable Rate Mortgage-Backed Pass-Through Certificates, Series 2006-3, of the Series specified on the face hereof (herein collectively called the “Certificates”), and representing a beneficial ownership interest in the Trust Fund created by the Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees that it will look solely to the funds on deposit in the Certificate Account for payment hereunder and that neither the Trustee nor the Trust Administrator is liable to the Certificateholders for any amount payable under this Certificate or the Agreement or, except as expressly provided in the Agreement, subject to any liability under the Agreement.
This Certificate does not purport to summarize the Agreement and reference is made to the Agreement for the interests, rights and limitations of rights, benefits, obligations and duties evidenced thereby, and the rights, duties and immunities of the Trustee and the Trust Administrator.
Pursuant to the terms of the Agreement, a distribution will be made on the 25th day of each month, or, if such 25th day is not a Business Day, the Business Day immediately following (the “Distribution Date”), commencing on the first Distribution Date specified on the face hereof, to the Person in whose name this Certificate is registered at the close of business on the applicable Record Date in an amount equal to the product of the Percentage Interest evidenced by this Certificate and the amount required to be distributed to Holders of Certificates of the Class to which this Certificate belongs on such Distribution Date pursuant to the Agreement. The Record Date applicable to each Distribution Date is (1) with respect to all Certificates other than the LIBOR Certificates held in Book-Entry Form on such Distribution Date, the close of business on the last day of the calendar month preceding the month in which such Distribution Date occurs and (2) with respect to the LIBOR Certificates held in Book-Entry Form on such Distribution Date, the close of business on the Business Day immediately preceding such Distribution Date.
Distributions on this Certificate shall be made by wire transfer of immediately available funds to the account of the Holder hereof at a bank or other entity having appropriate facilities therefor, if such Certificateholder shall have so notified the Trust Administrator in writing at least five Business Days prior to the related Record Date and such Certificateholder shall satisfy the conditions to receive such form of payment set forth in the Agreement, or, if not, by check mailed by first class mail to the address of such Certificateholder appearing in the Certificate Register. The final distribution on each Certificate will be made in like manner, but only upon presentment and surrender of such Certificate at the Corporate Trust Office or such other location specified in the notice to Certificateholders of such final distribution.
The Agreement permits, with certain exceptions therein provided, the amendment thereof and the modification of the rights and obligations of the Trustee, the Trust Administrator and the rights of the Certificateholders under the Agreement at any time by the Depositor, the Master Servicer, the Servicers, the Special Servicer, the Seller, the Trustee and the Trust Administrator with the consent of the Holders of Certificates affected by such amendment evidencing the requisite Percentage Interest, as provided in the
|
G-1 |
Agreement. Any such consent by the Holder of this Certificate shall be conclusive and binding on such Holder and upon all future Holders of this Certificate and of any Certificate issued upon the transfer hereof or in exchange therefor or in lieu hereof whether or not notation of such consent is made upon this Certificate. The Agreement also permits the amendment thereof, in certain limited circumstances, without the consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein set forth, the transfer of this Certificate is registrable in the Certificate Register of the Trust Administrator upon surrender of this Certificate for registration of transfer at the Corporate Trust Office or the office or agency maintained by the Trust Administrator in New York, New York, accompanied by a written instrument of transfer in form satisfactory to the Trust Administrator and the Certificate Registrar duly executed by the holder hereof or such holder’s attorney duly authorized in writing, and thereupon one or more new Certificates of the same Class in authorized denominations and evidencing the same aggregate Percentage Interest in the Trust Fund will be issued to the designated transferee or transferees.
The Certificates are issuable only as registered Certificates without coupons in denominations specified in the Agreement. As provided in the Agreement and subject to certain limitations therein set forth, Certificates are exchangeable for new Certificates of the same Class in authorized denominations and evidencing the same aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer or exchange, but the Trust Administrator may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith.
The Depositor, each Servicer, the Master Servicer, the Seller, the Trustee and the Trust Administrator and any agent of the Depositor, each Servicer, the Master Servicer, the Seller, the Trustee or the Trust Administrator may treat the Person in whose name this Certificate is registered as the owner hereof for all purposes, and none of the Depositor, the Servicers, the Master Servicer, the Seller, the Trustee, the Trust Administrator or any such agent shall be affected by any notice to the contrary.
On any Distribution Date on which the Stated Principal Balance of Mortgage Loans in such Loan Groups as are specified in the Agreement are less than those percentages set forth in the Agreement, all remaining Mortgage Loans in such Loan Groups and all property acquired in respect of such Mortgage Loans may be purchased as provided in the Agreement. In the event that no such purchase occurs, the obligations and responsibilities created by the Agreement will terminate upon the later of the maturity or other liquidation (or any advance with respect thereto) of the last Mortgage Loan remaining in the Trust Fund or the disposition of all property in respect thereof and the distribution to Certificateholders of all amounts required to be distributed pursuant to the Agreement. In no event, however, will the trust created by the Agreement continue beyond the earlier of (i) the expiration of 21 years from the death of the last survivor of the descendants living at the date of the Agreement of a certain person named in the Agreement or (ii) 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 related Cut-off Date. Any term used herein that is defined in the Agreement shall have the meaning assigned in the Agreement, and nothing herein shall be deemed inconsistent with that meaning.
|
G-2 |
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Please print or typewrite name and address including postal zip code of assignee)
the Percentage Interest evidenced by the within Certificate and hereby authorizes the transfer of registration of such Percentage Interest to assignee on the Certificate Register of the Trust Fund.
I (We) further direct the Trust Administrator to issue a new Certificate of a like denomination and Class, to the above named assignee and deliver such Certificate to the following address:
______________________________________________________________________________
Dated:
Signature by or on behalf of assignor
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
|
Distributions shall be made, by wire transfer or otherwise, in immediately available funds to |
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|
, | |||||||
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for the account of |
, |
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account number |
, or, if mailed by check, to |
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______________________________________________________________________________ ______________________________________________________________________________ |
||||||||
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Applicable statements should be mailed to |
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______________________________________________________________________________ ______________________________________________________________________________ |
||||||||
This information is provided by, the assignee named above, or, as its agent.
|
G-3 |
EXHIBIT H-1
FORM OF SERVICER INFORMATION
The following information will be emailed to the Master Servicer by each Servicer and to the Trust Administrator by the Master Servicer:
|
Standard File Layout - Master Servicing |
|
|
| |
|
Column Name |
Description |
Decimal |
Format Comment |
Max Size |
|
SER_INVESTOR_NBR |
A value assigned by the Servicer to define a group of loans. |
Text up to 10 digits |
20 | |
|
LOAN_NBR |
A unique identifier assigned to each loan by the investor. |
Text up to 10 digits |
10 | |
|
SERVICER_LOAN_NBR |
A unique number assigned to a loan by the Servicer. This may be different than the LOAN_NBR. |
Text up to 10 digits |
10 | |
|
BORROWER_NAME |
The borrower name as received in the file. It is not separated by first and last name. |
Maximum length of 30 (Last, First) |
30 | |
|
SCHED_PAY_AMT |
Scheduled monthly principal and scheduled interest payment that a borrower is expected to pay, P&I constant. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
NOTE_INT_RATE |
The loan interest rate as reported by the Servicer. |
4 |
Max length of 6 |
6 |
|
NET_INT_RATE |
The loan gross interest rate less the service fee rate as reported by the Servicer. |
4 |
Max length of 6 |
6 |
|
SERV_FEE_RATE |
The servicer's fee rate for a loan as reported by the Servicer. |
4 |
Max length of 6 |
6 |
|
SERV_FEE_AMT |
The servicer's fee amount for a loan as reported by the Servicer. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
NEW_PAY_AMT |
The new loan payment amount as reported by the Servicer. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
NEW_LOAN_RATE |
The new loan rate as reported by the Servicer. |
4 |
Max length of 6 |
6 |
|
ARM_INDEX_RATE |
The index the Servicer is using to calculate a forecasted rate. |
4 |
Max length of 6 |
6 |
|
ACTL_BEG_PRIN_BAL |
The borrower's actual principal balance at the beginning of the processing cycle. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
ACTL_END_PRIN_BAL |
The borrower's actual principal balance at the end of the processing cycle. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
BORR_NEXT_PAY_DUE_DATE |
The date at the end of processing cycle that the borrower's next payment is due to the Servicer, as reported by Servicer. |
MM/DD/YYYY |
10 | |
|
SERV_CURT_AMT_1 |
The first curtailment amount to be applied. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
SERV_CURT_DATE_1 |
The curtailment date associated with the first curtailment amount. |
MM/DD/YYYY |
10 | |
|
CURT_ADJ_ AMT_1 |
The curtailment interest on the first curtailment amount, if applicable. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
SERV_CURT_AMT_2 |
The second curtailment amount to be applied. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
SERV_CURT_DATE_2 |
The curtailment date associated with the second curtailment amount. |
MM/DD/YYYY |
10 | |
|
CURT_ADJ_ AMT_2 |
The curtailment interest on the second curtailment amount, if applicable. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
SERV_CURT_AMT_3 |
The third curtailment amount to be applied. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
SERV_CURT_DATE_3 |
The curtailment date associated with the third curtailment amount. |
MM/DD/YYYY |
10 | |
|
CURT_ADJ_AMT_3 |
The curtailment interest on the third curtailment amount, if applicable. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
PIF_AMT |
The loan "paid in full" amount as reported by the Servicer. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
PIF_DATE |
The paid in full date as reported by the Servicer. |
MM/DD/YYYY |
10 | |
|
|
|
|
Action Code Key: 15=Bankruptcy, 30=Foreclosure, , 60=PIF, 63=Substitution, 65=Repurchase, 70=REO |
2 |
|
ACTION_CODE |
The standard FNMA numeric code used to indicate the default/delinquent status of a particular loan. | |||
|
|
H-1-1 |
|
INT_ADJ_AMT |
The amount of the interest adjustment as reported by the Servicer. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
SOLDIER_SAILOR_ADJ_AMT |
The Soldier and Sailor Adjustment amount, if applicable. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
NON_ADV_LOAN_AMT |
The Non Recoverable Loan Amount, if applicable. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
LOAN_LOSS_AMT |
The amount the Servicer is passing as a loss, if applicable. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
SCHED_BEG_PRIN_BAL |
The scheduled outstanding principal amount due at the beginning of the cycle date to be passed through to investors. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
SCHED_END_PRIN_BAL |
The scheduled principal balance due to investors at the end of a processing cycle. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
SCHED_PRIN_AMT |
The scheduled principal amount as reported by the Servicer for the current cycle -- only applicable for Scheduled/Scheduled Loans. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
SCHED_NET_INT |
The scheduled gross interest amount less the service fee amount for the current cycle as reported by the Servicer -- only applicable for Scheduled/Scheduled Loans. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
ACTL_PRIN_AMT |
The actual principal amount collected by the Servicer for the current reporting cycle -- only applicable for Actual/Actual Loans. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
ACTL_NET_INT |
The actual gross interest amount less the service fee amount for the current reporting cycle as reported by the Servicer -- only applicable for Actual/Actual Loans. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
PREPAY_PENALTY_ AMT |
The penalty amount received when a borrower prepays on his loan as reported by the Servicer. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
PREPAY_PENALTY_ WAIVED |
The prepayment penalty amount for the loan waived by the servicer. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
|
|
|
|
|
|
MOD_DATE |
The Effective Payment Date of the Modification for the loan. |
MM/DD/YYYY |
10 | |
|
MOD_TYPE |
The Modification Type. |
|
Varchar - value can be alpha or numeric |
30 |
|
DELINQ_P&I_ADVANCE_AMT |
The current outstanding principal and interest advances made by Servicer. |
2 |
No commas(,) or dollar signs ($) |
11 |
|
|
H-1-2 |
EXHIBIT H-2
REPORTING DATA FOR DEFAULTED LOANS
|
Column/Header Name |
Description |
Decimal |
Format Comment |
|
SERVICER_LOAN_NBR |
A unique number assigned to a loan by the Servicer. This may be different than the LOAN_NBR |
|
|
|
LOAN_NBR |
A unique identifier assigned to each loan by the originator. |
|
|
|
CLIENT_NBR |
Servicer Client Number |
|
|
|
SERV_INVESTOR_NBR |
Contains a unique number as assigned by an external servicer to identify a group of loans in their system. |
|
|
|
BORROWER_FIRST_NAME |
First Name of the Borrower. |
|
|
|
BORROWER_LAST_NAME |
Last name of the borrower. |
|
|
|
PROP_ADDRESS |
Street Name and Number of Property |
|
|
|
PROP_STATE |
The state where the property located. |
|
|
|
PROP_ZIP |
Zip code where the property is located. |
|
|
|
BORR_NEXT_PAY_DUE_DATE |
The date that the borrower's next payment is due to the servicer at the end of processing cycle, as reported by Servicer. |
|
MM/DD/YYYY |
|
LOAN_TYPE |
Loan Type (i.e. FHA, VA, Conv) |
|
|
|
BANKRUPTCY_FILED_DATE |
The date a particular bankruptcy claim was filed. |
|
MM/DD/YYYY |
|
BANKRUPTCY_CHAPTER_CODE |
The chapter under which the bankruptcy was filed. |
|
|
|
BANKRUPTCY_CASE_NBR |
The case number assigned by the court to the bankruptcy filing. |
|
|
|
POST_PETITION_DUE_DATE |
The payment due date once the bankruptcy has been approved by the courts |
|
MM/DD/YYYY |
|
BANKRUPTCY_DCHRG_DISM_DATE |
The Date The Loan Is Removed From Bankruptcy. Either by Dismissal, Discharged and/or a Motion For Relief Was Granted. |
|
MM/DD/YYYY |
|
LOSS_MIT_APPR_DATE |
The Date The Loss Mitigation Was Approved By The Servicer |
|
MM/DD/YYYY |
|
LOSS_MIT_TYPE |
The Type Of Loss Mitigation Approved For A Loan Such As; |
|
|
|
LOSS_MIT_EST_COMP_DATE |
The Date The Loss Mitigation /Plan Is Scheduled To End/Close |
|
MM/DD/YYYY |
|
LOSS_MIT_ACT_COMP_DATE |
The Date The Loss Mitigation Is Actually Completed |
|
MM/DD/YYYY |
|
FRCLSR_APPROVED_DATE |
The date DA Admin sends a letter to the servicer with instructions to begin foreclosure proceedings. |
|
MM/DD/YYYY |
|
ATTORNEY_REFERRAL_DATE |
Date File Was Referred To Attorney to Pursue Foreclosure |
|
MM/DD/YYYY |
|
FIRST_LEGAL_DATE |
Notice of 1st legal filed by an Attorney in a Foreclosure Action |
|
MM/DD/YYYY |
|
FRCLSR_SALE_EXPECTED_DATE |
The date by which a foreclosure sale is expected to occur. |
|
MM/DD/YYYY |
|
FRCLSR_SALE_DATE |
The actual date of the foreclosure sale. |
|
MM/DD/YYYY |
|
FRCLSR_SALE_AMT |
The amount a property sold for at the foreclosure sale. |
2 |
No commas(,) or dollar signs ($) |
|
EVICTION_START_DATE |
The date the servicer initiates eviction of the borrower. |
|
MM/DD/YYYY |
|
EVICTION_COMPLETED_DATE |
The date the court revokes legal possession of the property from the borrower. |
|
MM/DD/YYYY |
|
LIST_PRICE |
The price at which an REO property is marketed. |
2 |
No commas(,) or dollar signs ($) |
|
LIST_DATE |
The date an REO property is listed at a particular price. |
|
MM/DD/YYYY |
|
OFFER_AMT |
The dollar value of an offer for an REO property. |
2 |
No commas(,) or dollar signs ($) |
|
OFFER_DATE_TIME |
The date an offer is received by DA Admin or by the Servicer. |
|
MM/DD/YYYY |
|
REO_CLOSING_DATE |
The date the REO sale of the property is scheduled to close. |
|
MM/DD/YYYY |
|
|
H-2-1 |
|
REO_ACTUAL_CLOSING_DATE |
Actual Date Of REO Sale |
|
MM/DD/YYYY |
|
OCCUPANT_CODE |
Classification of how the property is occupied. |
|
|
|
PROP_CONDITION_CODE |
A code that indicates the condition of the property. |
|
|
|
PROP_INSPECTION_DATE |
The date a property inspection is performed. |
|
MM/DD/YYYY |
|
APPRAISAL_DATE |
The date the appraisal was done. |
|
MM/DD/YYYY |
|
CURR_PROP_VAL |
The current "as is" value of the property based on brokers price opinion or appraisal. |
2 |
|
|
REPAIRED_PROP_VAL |
The amount the property would be worth if repairs are completed pursuant to a broker's price opinion or appraisal. |
2 |
|
|
If applicable: |
|
|
|
|
DELINQ_STATUS_CODE |
FNMA Code Describing Status of Loan |
|
|
|
DELINQ_REASON_CODE |
The circumstances which caused a borrower to stop paying on a loan. Code indicates the reason why the loan is in default for this cycle. |
|
|
|
MI_CLAIM_FILED_DATE |
Date Mortgage Insurance Claim Was Filed With Mortgage Insurance Company. |
|
MM/DD/YYYY |
|
MI_CLAIM_AMT |
Amount of Mortgage Insurance Claim Filed |
|
No commas(,) or dollar signs ($) |
|
MI_CLAIM_PAID_DATE |
Date Mortgage Insurance Company Disbursed Claim Payment |
|
MM/DD/YYYY |
|
MI_CLAIM_AMT_PAID |
Amount Mortgage Insurance Company Paid On Claim |
2 |
No commas(,) or dollar signs ($) |
|
POOL_CLAIM_FILED_DATE |
Date Claim Was Filed With Pool Insurance Company |
|
MM/DD/YYYY |
|
POOL_CLAIM_AMT |
Amount of Claim Filed With Pool Insurance Company |
2 |
No commas(,) or dollar signs ($) |
|
POOL_CLAIM_PAID_DATE |
Date Claim Was Settled and The Check Was Issued By The Pool Insurer |
|
MM/DD/YYYY |
|
POOL_CLAIM_AMT_PAID |
Amount Paid On Claim By Pool Insurance Company |
2 |
No commas(,) or dollar signs ($) |
|
FHA_PART_A_CLAIM_FILED_DATE |
Date FHA Part A Claim Was Filed With HUD |
|
MM/DD/YYYY |
|
FHA_PART_A_CLAIM_AMT |
Amount of FHA Part A Claim Filed |
2 |
No commas(,) or dollar signs ($) |
|
FHA_PART_A_CLAIM_PAID_DATE |
Date HUD Disbursed Part A Claim Payment |
|
MM/DD/YYYY |
|
FHA_PART_A_CLAIM_PAID_AMT |
Amount HUD Paid on Part A Claim |
2 |
No commas(,) or dollar signs ($) |
|
FHA_PART_B_CLAIM_FILED_DATE |
Date FHA Part B Claim Was Filed With HUD |
|
MM/DD/YYYY |
|
FHA_PART_B_CLAIM_AMT |
Amount of FHA Part B Claim Filed |
2 |
No commas(,) or dollar signs ($) |
|
FHA_PART_B_CLAIM_PAID_DATE |
Date HUD Disbursed Part B Claim Payment |
|
MM/DD/YYYY |
|
FHA_PART_B_CLAIM_PAID_AMT |
Amount HUD Paid on Part B Claim |
2 |
No commas(,) or dollar signs ($) |
|
VA_CLAIM_FILED_DATE |
Date VA Claim Was Filed With the Veterans Admin |
|
MM/DD/YYYY |
|
VA_CLAIM_PAID_DATE |
Date Veterans Admin. Disbursed VA Claim Payment |
|
MM/DD/YYYY |
|
|
H-2-2 |
|
VA_CLAIM_PAID_AMT |
Amount Veterans Admin. Paid on VA Claim |
2 |
No commas(,) or dollar signs ($) |
|
|
H-2-3 |
Standard File Codes – Delinquency Reporting
The Loss Mit Type field should show the approved Loss Mitigation Code as follows:
|
|
• |
ASUM- |
Approved Assumption |
| ||||||||||
|
|
• |
BAP- |
Borrower Assistance Program |
| ||||||||||
|
|
• |
CO- |
Charge Off |
| ||||||||||
|
|
• |
DIL- |
Deed-in-Lieu |
| ||||||||||
|
|
• |
FFA- |
Formal Forbearance Agreement |
| ||||||||||
|
|
• |
MOD- |
Loan Modification |
| ||||||||||
|
|
• |
PRE- |
Pre-Sale |
| ||||||||||
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|
• |
SS- |
Short Sale |
| ||||||||||
|
|
• |
MISC- |
Anything else approved by the PMI or Pool Insurer | |||||||||||
NOTE: Xxxxx Fargo Bank will accept alternative Loss Mitigation Types to those above, provided that they are consistent with industry standards. If Loss Mitigation Types other than those above are used, the Servicer must supply Xxxxx Fargo Bank with a description of each of the Loss Mitigation Types prior to sending the file.
The Occupant Code field should show the current status of the property code as follows:
|
|
• |
Mortgagor |
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|
• |
Tenant |
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|
• |
Unknown |
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|
• |
Vacant |
The Property Condition field should show the last reported condition of the property as follows:
|
|
• |
Damaged |
|
|
• |
Excellent |
|
|
• |
Fair |
|
|
• |
Gone |
|
|
• |
Good |
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|
• |
Poor |
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|
• |
Special Hazard |
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• |
Unknown |
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|
H-2-4 |
EXHIBIT H-3
FORM OF REALIZED LOSS CALCULATION
Calculation of Realized Loss/Gain Form 332– Instruction Sheet
NOTE: Do not net or combine items. Show all expenses individually and all credits as separate line items. Claim packages are due on the remittance report date. Late submissions may result in claims not being passed until the following month. The Servicer is responsible to remit all funds pending loss approval and /or resolution of any disputed items.
The numbers on the 332 form correspond with the numbers listed below.
Liquidation and Acquisition Expenses:
|
|
1. |
The Actual Unpaid Principal Balance of the Mortgage Loan. For documentation, an Amortization Schedule from date of default through liquidation breaking out the net interest and servicing fees advanced is required. |
|
|
2. |
The Total Interest Due less the aggregate amount of servicing fee that would have been earned if all delinquent payments had been made as agreed. For documentation, an Amortization Schedule from date of default through liquidation breaking out the net interest and servicing fees advanced is required. |
|
|
3. |
Accrued Servicing Fees based upon the Scheduled Principal Balance of the Mortgage Loan as calculated on a monthly basis. For documentation, an Amortization Schedule from date of default through liquidation breaking out the net interest and servicing fees advanced is required. |
|
|
4-12. |
Complete as applicable. Required documentation: |
* For taxes and insurance advances – see page 2 of 332 form - breakdown required showing period of coverage, base tax, interest, penalty. Advances prior to default require evidence of servicer efforts to recover advances.
* For escrow advances - complete payment history (to calculate advances from last positive escrow balance forward)
* Other expenses - copies of corporate advance history showing all payments
* REO repairs > $1500 require explanation
* REO repairs >$3000 require evidence of at least 2 bids.
* Short Sale or Charge Off require P&L supporting the decision and WFB’s approved Servicing Officer Certification
* Unusual or extraordinary items may require further documentation.
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13. |
The total of lines 1 through 12. |
Credits:
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14-21. |
Complete as applicable. Required documentation: |
* Copy of the HUD 1 from the REO sale. If a 3rd Party Sale, bid instructions and Escrow Agent / Attorney
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Letter of Proceeds Breakdown. |
* Copy of EOB for any MI or gov't guarantee
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* All other credits need to be clearly defined on the 332 form |
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H-3-1 |
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22. |
The total of lines 14 through 21. |
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Please Note: |
For HUD/VA loans, use line (18a) for Part A/Initial proceeds and line (18b) for Part B/Supplemental proceeds. |
Total Realized Loss (or Amount of Any Gain)
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23. |
The total derived from subtracting line 22 from 13. If the amount represents a realized gain, show the amount in parenthesis ( ). |
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H-3-2 |
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Prepared by: __________________ |
Date: _______________ | ||
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Phone: ______________________ |
Email Address:_____________________ |
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Servicer Loan No.
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Servicer Name
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Servicer Address
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XXXXX FARGO BANK, N.A. Loan No._____________________________
Borrower's Name: _________________________________________________________
Property Address: _________________________________________________________
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Liquidation Type: REO Sale |
3rd Party Sale |
Short Sale |
Charge Off |
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Was this loan granted a Bankruptcy deficiency or cramdown |
Yes |
No |
If “Yes”, provide deficiency or cramdown amount _______________________________
Liquidation and Acquisition Expenses:
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(1) |
Actual Unpaid Principal Balance of Mortgage Loan |
$ ______________ |
(1) |
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(2) |
Interest accrued at Net Rate |
________________ |
(2) |
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(3) |
Accrued Servicing Fees |
________________ |
(3) |
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(4) |
Attorney's Fees |
________________ |
(4) |
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(5) |
Taxes (see page 2) |
________________ |
(5) |
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(6) |
Property Maintenance |
________________ | ||||||
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(6) |
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(7) |
MI/Hazard Insurance Premiums (see page 2) |
________________ |
(7) |
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(8) |
Utility Expenses |
________________ |
(8) |
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(9) |
Appraisal/BPO |
________________ |
(9) |
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(10) Property Inspections ________________(10)
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(11) |
FC Costs/Other Legal Expenses |
________________ |
(11) |
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(12) |
Other (itemize) |
________________ |
(12) |
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Cash for Keys__________________________ |
________________ |
(12) | |
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HOA/Condo Fees_______________________ |
________________ |
(12) | |
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______________________________________ |
________________ |
(12) | |
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Total Expenses |
$ _______________ |
(13) |
Credits:
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(14) |
Escrow Balance |
$ _______________ |
(14) |
(15) HIP Refund________________(15)
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(16) |
Rental Receipts |
________________ |
(16) |
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H-3-3 |
(17) Hazard Loss Proceeds________________(17)
(18) Primary Mortgage Insurance / Gov’t Insurance________________(18a) HUD Part A
________________ (18b) HUD Part B
(19) Pool Insurance Proceeds________________(19)
(20) Proceeds from Sale of Acquired Property________________(20)
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(21) |
Other (itemize) |
________________ |
(21) | |
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_________________________________________ |
________________ |
(21) | ||
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Total Credits |
$________________ |
(22) | |
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Total Realized Loss (or Amount of Gain) |
$________________ |
(23) | |
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H-3-4 |
Escrow Disbursement Detail
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Type (Tax /Ins.) |
Date Paid |
Period of Coverage |
Total Paid |
Base Amount |
Penalties |
Interest |
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H-3-5 |
EXHIBIT I
FORM OF TRUST RECEIPT AND INITIAL CERTIFICATION
[_________________, 200_]
U.S. Bank National Association
as Trustee for the
Adjustable Rate Mortgage Trust 2006-3
Corporate Trust Services/Structured Finance
00 Xxxxxxxxxx Xxxxxx, XX XX WS3D
St. Xxxx, Minnesota 55107
Xxxxx Fargo Bank, N.A.,
as Trust Administrator and Master Servicer for the
Adjustable Rate Mortgage Trust 2006-3
0000 Xxx Xxxxxxxxx Xxxx,
Columbia, MD 21045
Credit Suisse First Boston Mortgage Securities Corp.
00 Xxxxxxx Xxxxxx
New York, New York 10010
Attention: Xxxxx Xxxx
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Re: |
Custodial Agreement, dated as of July 1, 2006, among U.S. Bank National Association, as Trustee, Xxxxx Fargo Bank, N.A., as Trust Administrator, and [_______________], as Custodian. |
Ladies and Gentlemen:
In accordance with the provisions of Section 4 of the above-referenced Custodial Agreement, the undersigned, as the Custodian, hereby certifies as to each Mortgage Loan in the Mortgage Loan Schedule that (i) it has received the original Mortgage Note and Assignment of Mortgage with respect to each Mortgage Loan identified on the Mortgage Loan Schedule attached hereto and (ii) such Mortgage Note has been reviewed by it and appears regular on its face and relates to such Mortgage Loan. The Custodian makes no representations as to (i) the validity, legality, enforceability, sufficiency, due authorization or genuineness of any of the documents contained in each Custodial File or of any of the Mortgage Loans or (ii) the collectability, insurability, effectiveness or suitability of any such Mortgage Loan.
The Custodian hereby confirms that it is holding each such Mortgage Note, Assignment of Mortgage and Assignment of Note as agent and bailee of, and custodian for the exclusive use and benefit, and subject to the sole direction, of the Trustee pursuant to the terms and conditions of the Custodial Agreement.
This Trust Receipt and Initial Certification is not divisible or negotiable.
The Custodian will accept and act on instructions with respect to the Mortgage Loans subject hereto upon surrender of this Trust Receipt and Initial Certification at its office at [CUSTODIAN ADDRESS], Attention: Document Custodian.
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I-1 |
Capitalized terms used herein shall have the meaning ascribed to them in the Custodial Agreement.
[_______________________________],
as Custodian
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By: |
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Name:
Title:
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I-2 |
EXHIBIT J
FORM OF TRUST RECEIPT AND FINAL CERTIFICATION
[date]
U.S. Bank National Association
as Trustee for the
Adjustable Rate Mortgage Trust 2006-3
Corporate Trust Services/Structured Finance
00 Xxxxxxxxxx Xxxxxx, XX XX WS3D
St. Xxxx, Minnesota 55107
Xxxxx Fargo Bank, N.A.,
as Trust Administrator and Master Servicer for the
Adjustable Rate Mortgage Trust 2006-3
0000 Xxx Xxxxxxxxx Xxxx,
Columbia, MD 21045
Credit Suisse First Boston Mortgage Securities Corp.
00 Xxxxxxx Xxxxxx
New York, New York 10010
Attention: Xxxxx Xxxx
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Re: |
Custodial Agreement, dated as of July 1, 2006, among U.S. Bank National Association, as Trustee, Xxxxx Fargo Bank, N.A., as Trust Administrator, and [____________________], as Custodian |
Ladies and Gentlemen:
In accordance with the provisions of Section [5][6] of the above-referenced Custodial Agreement, the undersigned, as the Custodian, hereby certifies that as to each Mortgage Loan listed on the Mortgage Loan Schedule (other than any Mortgage Loan paid in full or any Mortgage Loan listed on the attachment hereto) it has reviewed the Custodial Files and has determined that (i) all documents required to be delivered to it pursuant to Sections 2(i)-(ix) of the Custodial Agreement are in its possession; (ii) such documents have been reviewed by it and appear regular on their face and related to such Mortgage Loan; (iii) all Assignments of Mortgage or intervening assignments of mortgage, as applicable, have been submitted for recording in the jurisdictions in which recording is necessary; and (iv) each Mortgage Note has been endorsed as provided in Section 2(ii) of the Custodial Agreement and each Mortgage has been assigned in accordance with Section 2(vi) of the Custodial Agreement. The Custodian makes no representations as to (i) the validity, legality, enforceability, sufficiency, due authorization or genuineness of any of the documents contained in each Custodial File or of any of the Mortgage Loans or (ii) the collectability, insurability, effectiveness or suitability of any such Mortgage Loan.
The Custodian hereby confirms that it is holding each such Custodial File as agent and bailee of, and custodian for the exclusive use and benefit, and subject to the sole direction, of Trustee pursuant to the terms and conditions of the Custodial Agreement.
This Trust Receipt and Final Certification is not divisible or negotiable.
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J-1 |
The Custodian will accept and act on instructions with respect to the Mortgage Loans subject hereto upon surrender of this Trust Receipt and Initial Certification at its office at [CUSTODIAN ADDRESS], Attention: Document Custodian.
Capitalized terms used herein shall have the meaning ascribed to them in the Custodial Agreement.
[_______________________________],
as Custodian
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By: |
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Name:
Title:
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J-2 |
EXHIBIT K
FORM OF REQUEST FOR RELEASE
[date]
To: U.S. Bank National Association
In connection with the administration of the Mortgage Loans held by you as Trustee under the Pooling and Servicing Agreement, dated as of July 1, 2006, among Credit Suisse First Boston Mortgage Securities Corp., as depositor, DLJ Mortgage Capital, Inc., as seller, Select Portfolio Servicing, Inc., as a servicer and as special servicer, U.S. Bank National Association, as trustee, and Xxxxx Fargo Bank, N.A., as a servicer, master servicer and trust administrator (the “Pooling and Servicing Agreement”), the undersigned hereby requests a release of the Mortgage File held by you as Trustee with respect to the following described Mortgage Loan for the reason indicated below.
Mortgagor’s Name:
Address:
Loan No.:
Reason for requesting file:
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____ |
1. |
Mortgage Loan paid in full. |
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____ |
2. |
Mortgage Loan repurchased.(The Servicer hereby certifies that the Purchase Price has been credited to the Certificate Account pursuant to the Pooling and Servicing Agreement.) |
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____ |
3. |
The Mortgage Loan is being foreclosed. |
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____ |
4. |
Other. (Describe) |
The undersigned acknowledges that the above Mortgage File will be held by the undersigned in accordance with the provisions of the Pooling and Servicing Agreement and will be returned, except if the Mortgage Loan has been paid in full or repurchased (in which case the Mortgage File will be retained by us permanently) when no longer required by us for such purpose.
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K-1 |
Capitalized terms used herein shall have the meanings ascribed to them in the Pooling and Servicing Agreement.
[NAME OF SERVICER]
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By: |
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Name: |
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Title: |
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K-2 |
EXHIBIT L
FORM OF TRANSFEROR CERTIFICATE
[date]
Credit Suisse First Boston Mortgage Securities Corp.
00 Xxxxxxx Xxxxxx, 0xx Floor
New York, NY 10010
Attention: Xxxxx Xxxx
[Trust Administrator]
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Re: |
[__________________] Mortgage-Backed Pass-Through Certificates, Series 200_-__ |
Ladies and Gentlemen:
In connection with our disposition of the above Certificates we certify that (a) we understand that the Certificates have not been registered under the Securities Act of 1933, as amended (the “Act”), and are being disposed by us in a transaction that is exempt from the registration requirements of the Act, (b) we have not offered or sold any Certificates to, or solicited offers to buy any Certificates from, any person, or otherwise approached or negotiated with any person with respect thereto, in a manner that would be deemed, or taken any other action which would result in, a violation of Section 5 of the Act, (c) to the extent we are disposing of a Class AR Certificate, we have no knowledge the Transferee is not a Permitted Transferee and (d) to the extent we are disposing of a Certificate in reliance upon Regulation S under the Act, that such transfer has been effected pursuant to and in accordance with Regulation S under the Act, and accordingly that:
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(1) |
the offer of the Certificates was not made to a person in the United States; |
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[(2) |
at the time the buy order was originated, the transferee was outside the United States or we and any person acting on our behalf reasonably believed that the transferee was outside the United States;]* |
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[(2) |
the transaction was executed in, on or through the facilities of a designated offshore securities market and neither us nor any person acting on our behalf knows that the transaction was prearranged with a buyer in the United States;]* |
* Insert one of these two provisions.
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(3) |
no directed selling efforts have been made in contravention of the requirements of Rule 903(b) or 904(b) of Regulation S, as applicable; and |
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(4) |
the transaction is not part of a plan or scheme to evade the registration requirements of the Act. |
Very truly yours,
Print Name of Transferor
By:
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Authorized Officer |
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L-1 |
EXHIBIT M-1
FORM OF INVESTMENT LETTER
[date]
Credit Suisse First Boston Mortgage Securities Corp.
00 Xxxxxxx Xxxxxx, 0xx Floor
New York, NY 10010
Attention: Xxxxx Xxxx
[Trust Administrator]
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Re: |
[__________________] Mortgage-Backed Pass-Through Certificates, Series 200_-__ |
Ladies and Gentlemen:
In connection with our acquisition of the above Certificates we certify that (a) we understand that the Certificates are not being registered under the Securities Act of 1933, as amended (the “Act”), or any state securities laws and are being transferred to us in a transaction that is exempt from the registration requirements of the Act and any such laws, (b) we are an “accredited investor,” as defined in Regulation D under the Act, and have such knowledge and experience in financial and business matters that we are capable of evaluating the merits and risks of investments in the Certificates, (c) we have had the opportunity to ask questions of and receive answers from the Depositor concerning the purchase of the Certificates and all matters relating thereto or any additional information deemed necessary to our decision to purchase the Certificates, (d) either (i) we are not an employee benefit plan or arrangement that is subject to the Employee Retirement Income Security Act of 1974, as amended, or Section 4975 of the Internal Revenue Code of 1986, as amended, nor are we using the assets of any such plan or arrangement, (ii) we are providing an Opinion of Counsel which establishes to the reasonable satisfaction of the Trust Administrator that the purchase and holding of ERISA-Restricted Certificates by, on behalf of or with “plan assets” of such plan or arrangement will not result in non-exempt prohibited transactions under Section 406 of ERISA or Section 4975 of the Code, and will not subject the Depositor, the Trustee, the Trust Administrator, the Master Servicer or any other Servicer to any obligation in addition to those undertaken in this Agreement or (iii) if, in the case of ERISA-Restricted Certificates that have been the subject of an ERISA-Qualifying Underwriting, we are an insurance company, we are purchasing such Certificates with funds contained in an “insurance company general account” (as such term is defined in Section V(e) of Prohibited Transaction Class Exemption 95-60 (“PTCE 95-60”)) and our purchase and holding of such Certificates are covered under Sections I and III of PTCE 95-60, (e) we are acquiring the Certificates for investment for our own account and not with a view to any distribution of such Certificates (but without prejudice to our right at all times to sell or otherwise dispose of the Certificates in accordance with clause (g) below), (f) we have not offered or sold any Certificates to, or solicited offers to buy any Certificates from, any person, or otherwise approached or negotiated with any person with respect thereto, or taken any other action which would result in a violation of Section 5 of the Act, and (g) we will not sell, transfer or otherwise dispose of any Certificates unless (1) such sale, transfer or other disposition is made pursuant to an effective registration statement under the Act or is exempt from such registration requirements, and if requested, we will at our expense provide an opinion of counsel satisfactory to the addressees of this Certificate that such sale, transfer or other disposition may be made pursuant to an exemption from the Act, (2) the purchaser or transferee of such Certificate has executed and delivered to you a certificate to substantially the same effect as this certificate, and (3) the purchaser or transferee has otherwise complied with any conditions for transfer set forth in the Pooling and Servicing Agreement.
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M-1-1 |
Very truly yours,
Print Name of Transferor
By:
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Authorized Officer |
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M-1-2 |
EXHIBIT M-2
FORM OF RULE 144A LETTER
[date]
Credit Suisse First Boston Mortgage Securities Corp.
00 Xxxxxxx Xxxxxx, 0xx Floor
New York, NY 10010
Attention: Xxxxx Xxxx
[Trust Administrator]
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Re: |
[__________________] Mortgage-Backed Pass-Through Certificates, Series 200_-__ |
Ladies and Gentlemen:
In connection with our acquisition of the above Certificates we certify that (a) we understand that the Certificates are not being registered under the Securities Act of 1933, as amended (the “Act”), or any state securities laws and are being transferred to us in a transaction that is exempt from the registration requirements of the Act and any such laws, (b) we have such knowledge and experience in financial and business matters that we are capable of evaluating the merits and risks of investments in the Certificates, (c) we have had the opportunity to ask questions of and receive answers from the Depositor concerning the purchase of the Certificates and all matters relating thereto or any additional information deemed necessary to our decision to purchase the Certificates, (d) either (i) we are not an employee benefit plan or arrangement that is subject to the Employee Retirement Income Security Act of 1974, as amended, or Section 4975 of the Internal Revenue Code of 1986, as amended, nor are we using the assets of any such plan or arrangement, (ii) we are providing an Opinion of Counsel which establishes to the reasonable satisfaction of the Trust Administrator that the purchase and holding of ERISA-Restricted Certificates by, on behalf of or with “plan assets” of such plan 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 Depositor, the Trustee, the Trust Administrator, the Master Servicer or any other Servicer to any obligation in addition to those undertaken in this Agreement or (iii) if, in the case of an ERISA-Restricted Certificates that have been the subject of an ERISA-Qualifying Underwriting, we are an insurance company, we are purchasing such Certificates with funds contained in an “insurance company general account” (as such term is defined in Section V(e) of Prohibited Transaction Class Exemption 95-60 (“PTCE 95-60”)) and our purchase and holding of such Certificates are covered under Sections I and III of PTCE 95-60, (e) we have not, nor has anyone acting on our behalf offered, transferred, pledged, sold or otherwise disposed of the Certificates, any interest in the Certificates or any other similar security to, or solicited any offer to buy or accept a transfer, pledge or other disposition of the Certificates, any interest in the Certificates or any other similar security from, or otherwise approached or negotiated with respect to the Certificates, any interest in the Certificates or any other similar security with, any person in any manner, or made any general solicitation by means of general advertising or in any other manner, or taken any other action, that would constitute a distribution of the Certificates under the Act or that would render the disposition of the Certificates a violation of Section 5 of the Act or require registration pursuant thereto, nor will act, nor has authorized or will authorize any person to act, in such manner with respect to the Certificates, (f) we are a “qualified institutional buyer” as that term is defined in Rule 144A under the Act (“Rule 144A”) and have completed either of the forms of certification to that effect attached hereto as Annex 1 or Annex 2, (g) we are aware that the sale to us is being made in reliance on Rule 144A, and (i) we are acquiring the Certificates for our own account or for resale pursuant to Rule 144A and further, understand that such Certificates may be resold, pledged or transferred only (A) to a person reasonably believed to be a
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M-2-1 |
qualified institutional buyer that purchases for its own account or for the account of a qualified institutional buyer to whom notice is given that the resale, pledge or transfer is being made in reliance on Rule 144A, or (B) pursuant to another exemption from registration under the Act.
Very truly yours,
Print Name of Transferor
By:
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Authorized Officer |
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M-2-2 |
EXHIBIT M-3
FORM OF REGULATION S LETTER
Credit Suisse First Boston Mortgage Securities Corp.
00 Xxxxxxx Xxxxxx, 0xx Floor
New York, NY 10010
Attention: Xxxxx Xxxx
[Trust Administrator]
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Re: |
[__________________] Mortgage-Backed Pass-Through Certificates, Series 200 - (the “Certificates”) |
Ladies and Gentlemen:
In connection with our acquisition of the above Certificates we certify that (a) we understand that the Certificates are not being registered under the Securities Act of 1933, as amended (the “Act”), or any state securities laws and are being transferred to us in a transaction that is exempt from the registration requirements of the Act and any such laws, (b) we have such knowledge and experience in financial and business matters that we are capable of evaluating the merits and risks of investments in the Certificates, (c) we have had the opportunity to ask questions of and receive answers from the Depositor concerning the purchase of the Certificates and all matters relating thereto or any additional information deemed necessary to our decision to purchase the Certificates, (d) either (i) we are not an employee benefit plan or arrangement that is subject to the Employee Retirement Income Security Act of 1974, as amended, or Section 4975 of the Internal Revenue Code of 1986, as amended, nor are we using the assets of any such plan or arrangement, (ii) we are providing an Opinion of Counsel which establishes to the reasonable satisfaction of the Trust Administrator that the purchase and holding of ERISA-Restricted Certificates by, on behalf of or with “plan assets” of such plan 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 Depositor, the Trustee, the Trust Administrator, the Master Servicer or any other Servicer to any obligation in addition to those undertaken in this Agreement or (iii) if, in the case of an ERISA-Restricted Certificates that have been the subject of an ERISA-Qualifying Underwriting, we are an insurance company, we are purchasing such Certificates with funds contained in an “insurance company general account” (as such term is defined in Section V(e) of Prohibited Transaction Class Exemption 95-60 (“PTCE 95-60”)) and our purchase and holding of such Certificates are covered under Sections I and III of PTCE 95-60, (e) we have not, nor has anyone acting on our behalf offered, transferred, pledged, sold or otherwise disposed of the Certificates, any interest in the Certificates or any other similar security to, or solicited any offer to buy or accept a transfer, pledge or other disposition of the Certificates, any interest in the Certificates or any other similar security from, or otherwise approached or negotiated with respect to the Certificates, any interest in the Certificates or any other similar security with, any person in any manner, or made any general solicitation by means of general advertising or in any other manner, or taken any other action, that would constitute a distribution of the Certificates under the Act or that would render the disposition of the Certificates a violation of Section 5 of the Act or require registration pursuant thereto, nor will act, nor has authorized or will authorize any person to act, in such manner with respect to the Certificates, (f) we are not a “U.S. person” within the meaning of Regulation S under the Act (a “Non-U.S. Person”), (g) we are aware that the sale to us is being made in reliance on Regulation S, and (h) we are acquiring the Certificates for our own account or for resale pursuant to Regulation S under the Act and further, understand that such Certificates may be resold, pledged or transferred only (A) to a person reasonably believed to be a qualified institutional buyer that purchases for its own account or for the account of a qualified institutional buyer to whom notice is given that the resale, pledge or transfer is being made in
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M-3-1 |
reliance on Rule 144A, (B) to a Non-U.S. Person in accordance with Regulation S under the Act or (C) pursuant to another exemption from registration under the Act.
Very truly yours,
[Print Name of Transferee]
By:
Name:
Title:
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M-3-2 |
EXHIBIT N
FORM OF TRANSFEREE AFFIDAVIT AND AGREEMENT
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STATE OF |
) |
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: ss.: | ||
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COUNTY OF |
) |
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[NAME OF OFFICER], being first duly sworn, deposes and says:
1. That he is [Title of Officer] or [Name of Owner] (record or beneficial owner (the “Owner”) of the Class [AR/AR-L] Certificates (the “Class [AR/AR-L] Certificates”)), a [savings institution] [corporation] duly organized and existing under the laws of [the State of ] [the United States], on behalf of which he makes this affidavit and agreement.
2. That the Owner (i) is not and will not be a “disqualified organization” as of [date of transfer] within the meaning of Section 860E(e)(5) of the Internal Revenue Code of 1986, as amended (the “Code”), (ii) will endeavor to remain other than a disqualified organization for so long as it retains its ownership interest in the Class [AR/AR-L] Certificates, and (iii) is acquiring the Class [AR/AR-L] Certificates for its own account. A “Permitted Transferee” is any person other than a “disqualified organization.” (For this purpose, a “disqualified organization” means the United States, any state or political subdivision thereof, any agency or instrumentality of any of the foregoing (other than an instrumentality all of the activities of which are subject to tax and, except for the Federal Home Loan Mortgage Corporation, a majority of whose board of directors is not selected by any such governmental entity) or any foreign government, international organization or any agency or instrumentality of such foreign government or organization, any rural electric or telephone cooperative, or any organization (other than certain farmers’ cooperatives) that is generally exempt from federal income tax unless such organization is subject to the tax on unrelated business taxable income).
3. That the Owner is aware (i) of the tax that would be imposed on transfers of Class [AR/AR-L] Certificates to disqualified organizations under the Code; (ii) that such tax would be on the transferor, or, if such transfer is through an agent (which person includes a broker, nominee or middleman) for a non-Permitted Transferee, on the agent; (iii) that the person otherwise liable for the tax shall be relieved of liability for the tax if the transferee furnishes to such person an affidavit that the transferee is a Permitted Transferee and, at the time of transfer, such person does not have actual knowledge that the affidavit is false; and (iv) that the Class [AR/AR-L] Certificates may be “noneconomic residual interests” within the meaning of Treasury regulations promulgated pursuant to the Code and that the transferor of a noneconomic residual interest will remain liable for any taxes due with respect to the income on such residual interest, if a significant purpose of the transfer was to enable the transferor to impede the assessment or collection of tax.
4. That the Owner is aware of the tax imposed on a “pass-through entity” holding Class [AR/AR-L] Certificates if at any time during the taxable year of the pass-through entity a non-Permitted Transferee is the record holder of an interest in such entity. (For this purpose, a “pass through entity” includes a regulated investment company, a real estate investment trust or common trust fund, a partnership, trust or estate, and certain cooperatives.)
5. That the Owner is aware that the Trustee will not register the Transfer of any Class [AR/AR-L] Certificates unless the transferee, or the transferee’s agent, delivers to it an affidavit and agreement, among other things, in substantially the same form as this affidavit and agreement. The
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N-1 |
Owner expressly agrees that it will not consummate any such transfer if it knows or believes that any of the representations contained in such affidavit and agreement are false.
6. That the Owner has reviewed the restrictions set forth on the face of the Class [AR/AR-L] Certificates and the provisions of Section 6.02 of the Pooling and Servicing Agreement under which the Class [AR/AR-L] Certificates were issued. The Owner expressly agrees to be bound by and to comply with such restrictions and provisions.
7. That the Owner consents to any additional restrictions or arrangements that shall be deemed necessary upon advice of counsel to constitute a reasonable arrangement to ensure that the Class [AR/AR-L] Certificates will only be owned, directly or indirectly, by an Owner that is a Permitted Transferee.
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8. |
That the Owner’s Taxpayer Identification Number is ________________. |
9. That the Owner is 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 includable 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.
10. That no purpose of the Owner relating to the purchase of the Class [AR/AR-L] Certificate by the Owner is or will be to impede the assessment or collection of tax.
11. That the Owner has no present knowledge or expectation that it will be unable to pay any United States taxes owed by it so long as any of the Certificates remain outstanding.
12. That the Owner has no present knowledge or expectation that it will become insolvent or subject to a bankruptcy proceeding for so long as any of the Certificates remain outstanding.
13. That no purpose of the Owner relating to any sale of the Class [AR/AR-L] Certificate by the Owner will be to impede the assessment or collection of tax.
14. The Owner hereby agrees to cooperate with the Trustee and to take any action required of it by the Code or Treasury regulations thereunder (whether now or hereafter promulgated) in order to create or maintain the REMIC status of the Trust Fund.
15. That the Owner is not an employee benefit or other plan subject to the prohibited transaction provisions of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), or Section 4975 of the Internal Revenue Code of 1986, as amended (the “Code”) (a “Plan”), or any other person (including an investment manager, a named fiduciary or a trustee of any Plan) acting, directly or indirectly, on behalf of or purchasing any Certificate with “plan assets” of any Plan.
16. The Owner hereby agrees that it will not take any action that could endanger the REMIC status of the Trust Fund or result in the imposition of tax on the Trust Fund unless counsel for, or acceptable to, the Trustee has provided an opinion that such action will not result in the loss of such REMIC status or the imposition of such tax, as applicable.
17. The Owner has provided financial statements or other financial information requested by the transferor in connection with the transfer of the Residual Certificates to permit the transferor to assess the financial capability of the Owner to pay any such taxes.
|
N-2 |
IN WITNESS WHEREOF, the Owner has caused this instrument to be executed on its behalf, pursuant to the authority of its Board of Directors, by its [Title of Officer] and its corporate seal to be hereunto attached, attested by its [Assistant] Secretary, this ____ day of ___________.
[NAME OF OWNER]
By:
|
|
[Name of Officer] | |
|
|
[Title of Officer] |
|
[Corporate Seal]
ATTEST:
[Assistant] Secretary
|
N-3 |
Personally appeared before me the above-named [Name of Officer], known or proved to me to be the same person who executed the foregoing instrument and to be the [Title of Officer] of the Owner, and acknowledged to me that he executed the same as his free act and deed and the free act and deed of the Owner.
Subscribed and sworn before me this _____ day of _______________________.
NOTARY PUBLIC
COUNTY OF
STATE OF
My Commission expires the _____ day of __________________, 20____.
|
N-4 |
EXHIBIT O
FORM OF TRANSFER CERTIFICATE
[date]
Credit Suisse First Boston Mortgage Securities Corp.
00 Xxxxxxx Xxxxxx, 0xx Floor
New York, New York 10010
Attention: Xxxxx Xxxx
[_____________________]
[_____________________]
[_____________________]
|
|
Re: |
[_________________________] Mortgage Backed Pass Through Certificates, Series 200_ ___, Class AR (the “Certificates”) |
Ladies and Gentlemen:
This letter is delivered to you in connection with the sale by _________________ (the “Seller”) to ____________________________________ (the “Purchaser”) of a _______% Percentage Interest in the above referenced Certificates, pursuant to Section 6.02 of the Pooling and Servicing Agreement dated as of July 1, 2006, among Credit Suisse First Boston Mortgage Securities Corp., as depositor, DLJ Mortgage Capital, Inc., as seller, Select Portfolio Servicing, Inc., as a servicer and as special servicer, U.S. Bank National Association, as trustee, and Xxxxx Fargo Bank, N.A., as a servicer, master servicer and trust administrator (the “Pooling and Servicing Agreement”). All terms used herein and not otherwise defined shall have the meanings set forth in the Pooling and Servicing Agreement. The Seller hereby certifies, represents and warrants to, and covenants with, the Depositor and the Trustee that:
1. No purpose of the Seller relating to sale of the Certificate by the Seller to the Purchaser is or will be to enable the Seller to impede the assessment or collection of any tax.
2. The Seller understands that the Purchaser has delivered to the Trustee a transfer affidavit and agreement in the form attached to the Pooling and Servicing Agreement as Exhibit N. The Seller does not know or believe that any representation contained therein is false.
3. The Seller has no actual knowledge that the proposed Transferee is not a Permitted Transferee.
4. The Seller has no actual knowledge that the Purchaser would be unwilling or unable to pay taxes due on its share of the taxable income attributable to the Certificate.
5. The Seller has conducted a reasonable investigation of the financial condition of the Purchaser and, as a result of the investigation, found that the Purchaser has historically paid its debts as they came due, and found no significant evidence to indicate that the Purchaser will not continue to pay its debts as they come due in the future.
6. The Purchaser has represented to the Seller that, if the Certificate constitutes a noneconomic residual interest, it (i) understands that as holder of a noneconomic residual interest it may
|
O-1 |
incur tax liabilities in excess of any cash flows generated by the interest, and (ii) intends to pay taxes associated with its holding of the Certificate as they become due.
Very truly yours,
[SELLER]
By:
|
|
Name: | |
|
|
Title: |
|
|
O-2 |
EXHIBIT P
FORM OF SPS MORTGAGE LOANS REPORT
DATA AND FORMAT TO BE PROVIDED BY SPS TO THE MASTER SERVICER
(in Excel format)
ALL SPS MORTGAGE LOANS
|
FIELD FORMAT |
FIELD |
|
Name* |
Text |
|
Lien Position * |
Text/Number |
|
FICO Score* |
Number |
|
Original Occupancy* |
Text |
|
Documentation* |
Text |
|
Purpose* |
Text |
|
Original Loan Amount* |
Number |
|
Original Appraisal Value* |
Number |
|
Original LTV* |
Number |
|
Original P&I* |
Number |
|
Original Interest Rate* |
Number |
|
First Payment Date* |
MM/DD/YY |
|
Origination Date* |
MM/DD/YY |
|
Originator* |
Text |
|
Loan Term* |
Number |
|
Product Type (adjustable rate or fixed rate)* |
Text |
|
Property Type* |
Text |
|
Street Address* |
Text |
|
City* |
Text |
|
Zip Code* |
Text |
|
State* |
Text |
|
MI Certificate Number* |
Number |
|
Prepayment Flag |
Text |
|
Prepayment Expiration Date |
MM/DD/YY |
|
Loan Number |
Text |
|
Deal Identifier by Loan |
Text |
|
Current Loan Amount |
Number |
|
Current LTV |
Number |
|
Current Interest Rate |
Number |
|
Last Interest Payment Date |
MM/DD/YY |
|
Current P&I Payment Amount |
Number |
|
Paid Off Code |
Text |
|
Scheduled Balance |
Number |
|
Calculation of Retained Yield by Loan Number (if applicable to the transaction) |
Number |
|
Reporting of Delinquency Status on Defaulted Mortgage Loans |
Text |
|
Current Market Value |
Number |
|
Date of Market Value |
MM/DD/YY |
|
As-is Value |
Number |
|
Repaired Value |
Number |
|
Type of Valuation |
Text |
|
Foreclosure Flag |
Text |
|
P-1 |
|
Bankruptcy Flag |
Text |
|
Date NOD sent to MI company |
MM/DD/YY |
|
Foreclosure Start Date (Referral Date) |
MM/DD/YY |
|
Scheduled Foreclosure Sale Date |
MM/DD/YY |
|
Foreclosure Actual Sale Date |
MM/DD/YY |
|
Actual Notice of Intent Date |
MM/DD/YY |
|
Actual First Legal Date |
MM/DD/YY |
|
Bankruptcy Chapter |
Number |
|
Actual Bankruptcy Start Date |
MM/DD/YY |
|
Actual Payment Plan Start and End Dates |
MM/DD/YY |
|
List Date |
MM/DD/YY |
|
List Price |
Number |
|
Vacancy/Occupancy Status |
Text |
|
Actual Eviction Start Date |
MM/DD/YY |
|
Actual Eviction Completion Date |
MM/DD/YY |
|
Actual REO Start Date |
MM/DD/YY |
|
Sales Price |
Number |
|
Actual Closing Date |
MM/DD/YY |
|
Net Sales Proceeds |
Number |
|
Mortgage Insurance Claim Filing Date |
MM/DD/YY |
|
Mortgage Insurance Proceeds Received |
Number |
|
Date Mortgage Insurance Proceeds Received |
MM/DD/YY |
|
Collection History |
|
|
P-2 |
EXHIBIT Q
FORM OF SPS FORECLOSURE SETTLEMENT STATEMENT
|
REMIC # |
|
Ending Interest Rate: |
| |||||
|
Original Amount of Loan: |
|
Fixed or Adjustable: |
| |||||
|
UPB Accrued Int to frcl sale: |
|
|
| |||||
|
Advanced Delinquent Interest: |
|
|
| |||||
|
Date Borrower Paid To: |
/ / |
|
| |||||
|
Borrower’s Name: |
|
|
| |||||
|
Property Address: |
|
|
| |||||
|
|
|
|
| |||||
|
MSP Bank/Category |
|
|
| |||||
|
Note Date: |
/ / |
|
| |||||
|
Date of REO: |
/ / |
|
| |||||
|
Disposition Date: |
/ / |
|
| |||||
|
|
|
|
| |||||
|
|
|
Amount |
Date of Valuation |
Type of Valuation |
| |||
|
Market Value |
AS IS: |
|
/ / |
|
| |||
|
|
Repaired |
|
|
|
| |||
|
Supplemental Value |
AS IS: |
|
/ / |
|
| |||
|
|
Repaired |
|
|
|
| |||
|
REO BPO Value: |
|
|
/ / |
|
| |||
|
List Price: |
|
|
|
|
| |||
|
Sales Price: |
|
|
|
|
| |||
|
|
|
|
|
|
| |||
|
|
Proceeds |
|
Expenses* |
|
| |||
|
List Price: |
|
|
Servicing Advances: |
|
| |||
|
Sales Price: |
|
0.00 |
|
Payee 70R01 Acquisition: |
| |||
|
Broker’s Commission: |
|
|
|
Payee 75R60 REO: |
| |||
|
Bonus Commission: |
|
|
|
Payee 75R49 Foreclosure: |
| |||
|
Lien Purchase/Paid Off: |
|
|
|
Payee 75R36 Escrow: |
| |||
|
Seller Closing Costs: |
|
|
|
Payee 75R52 Bankruptcy: |
| |||
|
Repair Costs: |
|
|
|
Discrepancy Amount: |
| |||
|
Seller Concessions: |
|
|
|
Servicing Advance Total: |
0.00 | |||
|
Other Closing Costs: |
|
|
Advances Applied After Liquidation: |
|
| |||
|
|
|
|
Prior Additional Advances: |
|
| |||
|
Net Proceeds: |
|
0.00 |
Escrow Advance: |
|
| |||
|
|
|
|
Interest on Advances: |
|
| |||
|
Escrow Balance: |
|
|
Other Advances: |
|
| |||
|
Suspense Balance: |
|
|
Servicing Advance Holdbacks: |
|
| |||
|
Restricted Escrow: |
|
|
|
Property Inspection: |
| |||
|
Rental Income Received: |
|
|
|
BPO: |
| |||
*All amounts will be itemized, and to the extent not itemized, this form will be accompanied by documentation supporting all amounts claimed on this form.
|
|
Q-1 |
|
Insurance Settlement Received: |
|
|
|
Lender Placed Insurance: |
|
| ||
|
Other: |
|
|
|
Utilities: |
|
| ||
|
|
|
|
|
REO Repair Costs: |
|
| ||
|
Total Liquidation Proceeds: |
0.00 |
Foreclosure Fees: |
| |||||
|
Total Liquidation Expenses: |
0.00 |
Bankruptcy: |
| |||||
|
Net Liquidation Proceeds: |
0.00 |
Eviction Costs: |
| |||||
|
Loan Principal Balance: |
|
Transfer Tax: |
| |||||
|
Realized Gain/Loss Amount: |
0.00 |
Reconveyance Fees: |
| |||||
|
Additional Proceeds Applied: |
|
Demand Fee: |
| |||||
|
Prior Additional Proceeds: |
|
Total Holdbacks: |
0.00 |
| ||||
|
Loss Severity: |
#DIV/0! |
Other Fees (Including Fee Code B): |
| |||||
|
Notes: |
|
UPB Accrued Interest to XXX: |
0.00 | |||||
|
|
|
Advanced Delinquent Interest: |
0.00 | |||||
|
|
|
Stopped Delinquent Interest: |
| |||||
|
|
|
Deferred Interest: |
| |||||
|
|
|
Additional Interest: |
| |||||
|
|
|
Total Liquidation Expenses: |
0.00 | |||||
|
|
Q-2 |
EXHIBIT R
RELEVANT SERVICING CRITERIA
The assessment of compliance to be delivered by the Master Servicer and the Trust Administrator shall address, at a minimum, the criteria identified as below as “Applicable Servicing Criteria” with respect to such party:
Where there are multiple checks for criteria the attesting party will identify in their management assertion that they are attesting only to the portion of the distribution chain they are responsible for in the related transaction agreements.
|
Regulation AB Reference |
Servicing Criteria |
Servicers |
Master Servicer |
Trust Administrator |
|
|
General Servicing Considerations |
|
|
|
|
|
1122(d)(1)(i) |
Policies and procedures are instituted to monitor any performance or other triggers and events of default in accordance with the transaction agreements. |
X |
X |
X |
|
1122(d)(1)(ii) |
If any material servicing activities are outsourced to third parties, policies and procedures are instituted to monitor the third party’s performance and compliance with such servicing activities. |
X |
X |
|
|
1122(d)(1)(iii) |
Any requirements in the transaction agreements to maintain a back-up servicer for the Pool Assets are maintained. |
|
|
|
|
1122(d)(1)(iv) |
A fidelity bond and errors and omissions policy is in effect on the party participating in the servicing function throughout the reporting period in the amount of coverage required by and otherwise in accordance with the terms of the transaction agreements. |
X |
X |
|
|
|
Cash Collection and Administration |
|
|
|
|
1122(d)(2)(i) |
Payments on pool assets are deposited into the appropriate custodial bank accounts and related bank clearing accounts no more than two business days following receipt, or such other number of days specified in the transaction agreements. |
X |
X |
X |
|
1122(d)(2)(ii) |
Disbursements made via wire transfer on behalf of an obligor or to an investor are made only by authorized personnel. |
X |
X |
X |
|
1122(d)(2)(iii) |
Advances of funds or guarantees regarding collections, cash flows or distributions, and any interest or other fees charged for such advances, are made, reviewed and approved as specified in the transaction agreements. |
X |
X |
|
|
1122(d)(2)(iv) |
The related accounts for the transaction, such as cash reserve accounts or accounts established as a form of over collateralization, are separately maintained (e.g., with respect to commingling of cash) as set forth in the transaction agreements. |
X |
X |
X |
R-1
|
1122(d)(2)(v) |
Each custodial account is maintained at a federally insured depository institution as set forth in the transaction agreements. For purposes of this criterion, “federally insured depository institution” with respect to a foreign financial institution means a foreign financial institution that meets the requirements of Rule 13k-1(b)(1) of the Securities Exchange Act. |
X |
X |
X |
|
1122(d)(2)(vi) |
Unissued checks are safeguarded so as to prevent unauthorized access. |
X |
|
|
|
1122(d)(2)(vii) |
Reconciliations are prepared on a monthly basis for all asset-backed securities related bank accounts, including custodial accounts and related bank clearing accounts. These reconciliations are (A) mathematically accurate; (B) prepared within 30 calendar days after the bank statement cutoff date, or such other number of days specified in the transaction agreements; (C) reviewed and approved by someone other than the person who prepared the reconciliation; and (D) contain explanations for reconciling items. These reconciling items are resolved within 90 calendar days of their original identification, or such other number of days specified in the transaction agreements. |
X |
X |
X |
|
|
Investor Remittances and Reporting |
|
|
|
|
1122(d)(3)(i) |
Reports to investors, including those to be filed with the Commission, are maintained in accordance with the transaction agreements and applicable Commission requirements. Specifically, such reports (A) are prepared in accordance with timeframes and other terms set forth in the transaction agreements; (B) provide information calculated in accordance with the terms specified in the transaction agreements; (C) are filed with the Commission as required by its rules and regulations; and (D) agree with investors’ or the trustee’s records as to the total unpaid principal balance and number of Pool Assets serviced by the Servicer. |
X |
X |
X |
|
1122(d)(3)(ii) |
Amounts due to investors are allocated and remitted in accordance with timeframes, distribution priority and other terms set forth in the transaction agreements. |
X |
X |
X |
|
1122(d)(3)(iii) |
Disbursements made to an investor are posted within two business days to the Servicer’s investor records, or such other number of days specified in the transaction agreements. |
X |
X |
X |
|
1122(d)(3)(iv) |
Amounts remitted to investors per the investor reports agree with cancelled checks, or other form of payment, or custodial bank statements. |
X |
X |
X |
|
|
Pool Asset Administration |
|
|
|
R-2
|
1122(d)(4)(i) |
Collateral or security on pool assets is maintained as required by the transaction agreements or related pool asset documents. |
X |
|
|
|
1122(d)(4)(ii) |
Pool assets and related documents are safeguarded as required by the transaction agreements |
X |
|
|
|
1122(d)(4)(iii) |
Any additions, removals or substitutions to the asset pool are made, reviewed and approved in accordance with any conditions or requirements in the transaction agreements. |
X |
|
|
|
1122(d)(4)(iv) |
Payments on pool assets, including any payoffs, made in accordance with the related pool asset documents are posted to the Servicer’s obligor records maintained no more than two business days after receipt, or such other number of days specified in the transaction agreements, and allocated to principal, interest or other items (e.g., escrow) in accordance with the related pool asset documents. |
X |
|
|
|
1122(d)(4)(v) |
The Servicer’s records regarding the pool assets agree with the Servicer’s records with respect to an obligor’s unpaid principal balance. |
X |
|
|
|
1122(d)(4)(vi) |
Changes with respect to the terms or status of an obligor's pool assets (e.g., loan modifications or re-agings) are made, reviewed and approved by authorized personnel in accordance with the transaction agreements and related pool asset documents. |
X |
|
|
|
1122(d)(4)(vii) |
Loss mitigation or recovery actions (e.g., forbearance plans, modifications and deeds in lieu of foreclosure, foreclosures and repossessions, as applicable) are initiated, conducted and concluded in accordance with the timeframes or other requirements established by the transaction agreements. |
X |
|
|
|
1122(d)(4)(viii) |
Records documenting collection efforts are maintained during the period a pool asset is delinquent in accordance with the transaction agreements. Such records are maintained on at least a monthly basis, or such other period specified in the transaction agreements, and describe the entity’s activities in monitoring delinquent pool assets including, for example, phone calls, letters and payment rescheduling plans in cases where delinquency is deemed temporary (e.g., illness or unemployment). |
X |
|
|
|
1122(d)(4)(ix) |
Adjustments to interest rates or rates of return for pool assets with variable rates are computed based on the related pool asset documents. |
X |
|
|
R-3
|
1122(d)(4)(x) |
Regarding any funds held in trust for an obligor (such as escrow accounts): (A) such funds are analyzed, in accordance with the obligor’s pool asset documents, on at least an annual basis, or such other period specified in the transaction agreements; (B) interest on such funds is paid, or credited, to obligors in accordance with applicable pool asset documents and state laws; and (C) such funds are returned to the obligor within 30 calendar days of full repayment of the related pool assets, or such other number of days specified in the transaction agreements. |
X |
|
|
|
1122(d)(4)(xi) |
Payments made on behalf of an obligor (such as tax or insurance payments) are made on or before the related penalty or expiration dates, as indicated on the appropriate bills or notices for such payments, provided that such support has been received by the servicer at least 30 calendar days prior to these dates, or such other number of days specified in the transaction agreements. |
X |
|
|
|
1122(d)(4)(xii) |
Any late payment penalties in connection with any payment to be made on behalf of an obligor are paid from the Servicer’s funds and not charged to the obligor, unless the late payment was due to the obligor’s error or omission. |
X |
|
|
|
1122(d)(4)(xiii) |
Disbursements made on behalf of an obligor are posted within two business days to the obligor’s records maintained by the servicer, or such other number of days specified in the transaction agreements. |
X |
|
|
|
1122(d)(4)(xiv) |
Delinquencies, charge-offs and uncollectible accounts are recognized and recorded in accordance with the transaction agreements. |
X |
X |
|
|
1122(d)(4)(xv) |
Any external enhancement or other support, identified in Item 1114(a)(1) through (3) or Item 1115 of Regulation AB, is maintained as set forth in the transaction agreements. |
|
|
|
[NAME OF COMPANY]
|
Date: |
_________________________ |
By:
|
Name: |
________________________________ |
|
Title: |
________________________________ |
R-4
EXHIBIT S
ADDITIONAL FORM 10-D DISCLOSURE
|
ADDITIONAL FORM 10-D DISCLOSURE
| |
|
Item on Form 10-D |
Party Responsible |
|
Item 1: Distribution and Pool Performance Information |
|
|
Information included in the [Monthly Statement] |
Servicer Master Servicer Trust Administrator |
|
Any information required by 1121 which is NOT included on the [Monthly Statement] |
Depositor |
|
Item 2: Legal Proceedings Any legal proceeding pending against the following entities or their respective property, that is material to Certificateholders, including any proceeding sknown to be contemplated by governmental authorities: |
|
|
• Issuing Entity (Trust Fund) |
Trustee, Master Servicer, Trust Administrator and Depositor |
|
• Sponsor (Seller) |
Seller (if a party to the Pooling and Servicing Agreement) or Depositor |
|
• Depositor |
Depositor |
|
• Trustee |
Trustee |
|
• Trust Administrator |
Trust Administrator |
|
• Master Servicer |
Master Servicer |
|
• Custodian |
Custodian |
|
• 1110(b) Originator |
Depositor |
|
• Any 1108(a)(2) Servicer (other than the Master Servicer or Trust Administrator) |
Servicer |
|
• Any other party contemplated by 1100(d)(1) |
Depositor |
|
Item 3: Sale of Securities and Use of Proceeds Information from Item 2(a) of Part II of Form 10-Q: With respect to any sale of securities by the sponsor, depositor or issuing entity, that are backed by the same asset pool or are otherwise issued by the issuing entity, whether or not registered, provide the sales and use of proceeds information in Item 701 of Regulation S-K. Pricing information can be omitted if securities were not registered. |
Depositor |
|
S-1 |
|
Item 4: Defaults Upon Senior Securities Information from Item 3 of Part II of Form 10-Q: Report the occurrence of any Event of Default (after expiration of any grace period and provision of any required notice) |
Trust Administrator Trustee |
|
Item 5: Submission of Matters to a Vote of Security Holders Information from Item 4 of Part II of Form 10-Q |
Trust Administrator Trustee |
|
Item 6: Significant Obligors of Pool Assets Item 1112(b) – Significant Obligor Financial Information* |
Depositor |
|
*This information need only be reported on the Form 10-D for the distribution period in which updated information is required pursuant to the Item. |
|
|
Item 7: Significant Enhancement Provider Information Item 1114(b)(2) – Credit Enhancement Provider Financial Information* |
|
|
• Determining applicable disclosure threshold |
Depositor |
|
• Requesting required financial information (including any required accountants’ consent to the use thereof) or effecting incorporation by reference |
Depositor
|
|
Item 1115(b) – Derivative Counterparty Financial Information* |
|
|
• Determining current maximum probable exposure |
Depositor |
|
• Determining current significance percentage |
Depositor |
|
• Requesting required financial information (including any required accountants’ consent to the use thereof) or effecting incorporation by reference |
Depositor
|
|
*This information need only be reported on the Form 10-D for the distribution period in which updated information is required pursuant to the Items. |
|
|
Item 8: Other Information Disclose any information required to be reported on Form 8-K during the period covered by the Form 10-D but not reported |
Any party responsible for the applicable Form 8-K Disclosure item |
|
Item 9: Exhibits |
|
|
Monthly Statement to Certificateholders |
Trust Administrator |
|
S-2 |
|
Exhibits required by Item 601 of Regulation S-K, such as material agreements |
Depositor |
|
S-3 |
EXHIBIT T
FORM OF MONTHLY STATEMENT TO CERTIFICATEHOLDERS
|
(i) |
With respect to each Class of Certificates which are not Notional Amount Certificates and, unless otherwise stated, the related Distribution Date, |
|
|
(a) |
the Initial Class Principal Balance of such Class as of the Cut-off Date; |
|
|
(b) |
the Class Principal Balance of such Class before giving effect to the distribution of principal and interest; |
|
|
(c) |
the amount of the related distribution on such Class allocable to interest; |
|
|
(d) |
the amount of the related distribution on such Class allocable to principal; |
|
|
(e) |
the sum of the principal and interest payable to such Class; |
|
|
(f) |
the Realized Loss allocable to such Class; |
|
|
(g) |
the Class Unpaid Interest Amount allocable to such Class; |
|
|
(h) |
the Class Principal Balance of such Class after giving effect to the distribution of principal and interest; |
|
|
(i) |
the Pass-Through Rate for such Class; |
|
|
(j) |
any Basis Risk Shortfall allocable to such Class, if such amount is greater than zero; |
|
|
(k) |
any shortfall in principal allocable to such Class, if such amount is greater than zero; |
|
(ii) |
with respect to each Class of Certificates which are Notional Amount Certificates and, unless otherwise stated, the related Distribution Date, |
|
|
(a) |
the Notional Amount of such Class as of the Cut-off Date; |
|
|
(b) |
the Notional Amount of such Class before giving effect to the distribution of interest; |
|
|
(c) |
the amount of the related distribution on such Class allocable to interest; |
|
|
(d) |
the amount of the related distribution on such Class allocable to principal; |
|
|
(e) |
the sum of the principal and interest payable to such class; |
|
|
(f) |
the Realized Loss allocable to such Class; |
|
|
(g) |
the Class Unpaid Interest Amount allocable to such Class; |
|
|
(h) |
the Notional Amount of such Class after giving effect to the distribution of interest; |
|
|
(i) |
the Pass-Through Rate for such Class; |
|
T-1 |
|
|
(j) |
any Basis Risk Shortfall allocable to such Class, if such amount is greater than zero; |
|
(iii) |
with respect to a $1000 factor of the Initial Class Principal Balance of each Class of Certificates which are not Notional Amount Certificates and the related Distribution Date, |
|
|
(a) |
the CUSIP number assigned to such Class; |
|
|
(b) |
the Class Principal Balance of such Class factor prior to giving effect to the distribution of principal and interest; |
|
|
(c) |
the amount of the related distribution allocable to interest on such Class factor; |
|
|
(d) |
the amount of the related distribution allocable to principal on such Class factor; |
|
|
(e) |
the sum of the principal and interest payable to such Class factor; |
|
|
(f) |
the Class Principal Balance of such Class factor after giving effect to the distribution of principal and interest; |
|
(iv) |
with respect to a $1000 factor of the Initial Class Principal Balance of each Class of Certificates which are Notional Amount Certificates and the related Distribution Date, |
|
|
(a) |
the CUSIP number assigned to such Class; |
|
|
(b) |
the Notional Amount of such Class factor prior to giving effect to the distribution of interest; |
|
|
(c) |
the amount of the related distribution allocable to interest on such Class factor; |
|
|
(d) |
the amount of the related distribution allocable to principal on such Class factor; |
|
|
(e) |
the sum of the principal and interest payable to such Class factor; |
|
|
(f) |
the Notional Amount of such Class factor after giving effect to the distribution of interest; |
|
(v) |
with respect to each Loan Group, in the aggregate, and, unless otherwise stated, the related Distribution Date, |
|
|
(a) |
the Scheduled Payment of principal for such Loan Group; |
|
|
(b) |
the amount of Principal Prepayments allocable to such Loan Group; |
|
|
(c) |
the amount of principal allocable to such Loan Group as a result of repurchased Mortgage Loans in such Loan Group; |
|
|
(d) |
the Substitution Adjustment Amount allocable to such Loan Group; |
|
|
(e) |
the amount of Net Liquidation Proceeds allocable to such Loan Group; |
|
|
(f) |
the amount of Insurance Proceeds allocable to such Loan Group; |
|
T-2 |
|
|
(g) |
the amount of any other distributions allocable to principal for such Loan Group; |
|
|
(h) |
the number of Mortgage Loans in such Loan Group as of the first day of the related Collection Period; |
|
|
(i) |
the aggregate Stated Principal Balance of the Mortgage Loans in such Loan Group as of the first day of the related Collection Period; |
|
|
(j) |
the number of Mortgage Loans in such Loan Group as of the last day of the related Collection Period; |
|
|
(k) |
the aggregate Stated Principal Balance of the Mortgage Loans in such Loan Group as of the last day of the related Collection Period; |
|
|
(l) |
the Master Servicing Fee, by Loan Group; |
|
|
(m) |
the sum of the Servicing Fee, the Mortgage Guaranty Insurance Policy fees, if applicable and the [RMIC/TGIC/MGIC] PMI fees, if applicable, for such Loan Group; |
|
|
(n) |
the Trust Administrator Fee applicable to such Loan Group; |
|
|
(o) |
the amount of current Advances allocable to such Loan Group; |
|
|
(p) |
the amount of outstanding Advances allocable to such Loan Group; |
|
|
(q) |
the number and aggregate principal amounts of Mortgage Loans delinquent (1) 31 to 60 days, (2) 61 to 90 days and (3) 91 days or more, for such Loan Group, including delinquent bankrupt Mortgage Loans but excluding foreclosure and REO Mortgage Loans; |
|
|
(r) |
the number and aggregate principal amounts of Mortgage Loans that are currently in bankruptcy, but not delinquent, for such Loan Group; |
|
|
(s) |
the number and aggregate principal amounts of Mortgage Loans that are in foreclosure for such Loan Group; |
|
|
(t) |
the Rolling Three Month Delinquency Rate or Rolling Six Month Delinquency Rate for such Loan Group; |
|
|
(u) |
the number and aggregate principal amount of any REO properties as of the close of business on the Determination Date preceding such Distribution Date for such Loan Group; |
|
|
(v) |
current Realized Losses allocable to such Loan Group; |
|
|
(w) |
cumulative Realized Losses allocable to such Loan Group; |
|
|
(x) |
the weighted average term to maturity of the Mortgage Loans in such Loan Group as of the close of business on the last day of the calendar month preceding the related Distribution Date; |
|
T-3 |
|
|
(y) |
the number and principal amount of claims submitted under the Mortgage Guaranty Insurance Policy, as applicable; |
|
|
(z) |
the number and principal amount of claims paid under the [RMIC/TGIC/MGIC] PMI Policy, as applicable; |
|
|
(aa) |
the number of Mortgage Loans in such Loan Group that have Assigned Prepayment Premiums and for which prepayments were made during the related Collection Period, as applicable; |
|
|
(bb) |
the aggregate principal balance of Mortgage Loans in such Loan Group that have Assigned Prepayment Premiums and for which prepayments were made during the related Collection Period, as applicable; |
|
|
(cc) |
the aggregate amount of Assigned Prepayment Premiums collected for such Loan Group during the related Collection Period, as applicable; |
|
|
(dd) |
current Realized Losses allocated to each Mortgage Loan in such Loan Group that has previously been allocated a Realized Loss; |
|
|
(ee) |
cumulative Realized Losses allocated to each Mortgage Loan in such Loan Group that has previously been allocated a Realized Loss; |
|
|
(ff) |
current Recoveries allocable to such Loan Group; |
|
|
(gg) |
cumulative Recoveries allocable to such Loan Group; |
|
|
(hh) |
current aggregate Stated Principal Balance of Qualified Substitute Mortgage Loans substituted for Deleted Mortgage Loans in such Loan Group; |
|
|
(ii) |
cumulative aggregate Stated Principal Balance of Qualified Substitute Mortgage Loans substituted for Deleted Mortgage Loans in such Loan Group; |
|
|
(jj) |
with respect to all of the Mortgage Loans, in the aggregate, and, unless otherwise stated, the related Distribution Date, for each Servicer that is servicing any of such Mortgage Loans, the aggregate Stated Principal Balance of Mortgage Loans being serviced by such Servicer as of such Distribution Date; and |
|
|
(kk) |
[reserved]; |
|
(vii) |
with respect to each overcollateralized Group of Certificates and, unless otherwise stated, the related Distribution Date, |
|
|
(a) |
the Targeted Overcollateralization Amount for such Group; |
|
|
(b) |
the Overcollateralization Amount for such Group; |
|
|
(c) |
the Overcollateralization Deficiency for such Group; |
|
|
(d) |
the Overcollateralization Release Amount for such Group; |
|
T-4 |
|
|
(e) |
the Monthly Excess Interest for such Group; |
|
|
(f) |
the amount of any payment to the [Class __-X] Certificates related to such Group; |
|
|
(g) |
if applicable, the Excess Interest Amount from an unrelated Group of Certificates that provides additional credit enhancement to the related overcollateralized Group of Certificates. |
|
T-5 |
EXHIBIT U
FORM 8-K DISCLOSURE INFORMATION
|
FORM 8-K DISCLOSURE INFORMATION | |
|
Item on Form 8-K |
Party Responsible |
|
Item 1.01- Entry into a Material Definitive Agreement Disclosure is required regarding entry into or amendment of any definitive agreement that is material to the securitization, even if depositor is not a party. Examples: servicing agreement, custodial agreement. Note: disclosure not required as to definitive agreements that are fully disclosed in the prospectus |
All parties (as to themselves) |
|
Item 1.02- Termination of a Material Definitive Agreement Disclosure is required regarding termination of any definitive agreement that is material to the securitization (other than expiration in accordance with its terms), even if depositor is not a party. Examples: servicing agreement, custodial agreement. |
All parties (as to themselves) |
|
Item 1.03- Bankruptcy or Receivership Disclosure is required regarding the bankruptcy or receivership, with respect to any of the following: |
Depositor |
|
• Sponsor (Seller) |
Depositor/Sponsor (Seller) |
|
• Depositor |
Depositor |
|
• Master Servicer |
Master Servicer |
|
• Affiliated Servicer |
Servicer |
|
• Other Servicer servicing 20% or more of the pool assets at the time of the report |
Servicer |
|
• Other material servicers |
Servicer |
|
• Trustee |
Trustee |
|
• Trust Administrator |
Trust Administrator |
|
• Significant Obligor |
Depositor |
|
• Credit Enhancer (10% or more) |
Depositor |
|
• Derivative Counterparty |
Depositor |
|
• Custodian |
Custodian |
|
U-1 |
|
Item 2.04- Triggering Events that Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement Includes an early amortization, performance trigger or other event, including event of default, that would materially alter the payment priority/distribution of cash flows/amortization schedule. Disclosure will be made of events other than waterfall triggers which are disclosed in the monthly statements to the certificateholders. |
Depositor Master Servicer Trust Administrator |
|
Item 3.03- Material Modification to Rights of Security Holders Disclosure is required of any material modification to documents defining the rights of Certificateholders, including the Pooling and Servicing Agreement. |
Trust Administrator Depositor |
|
Item 5.03- Amendments of Articles of Incorporation or Bylaws; Change of Fiscal Year Disclosure is required of any amendment “to the governing documents of the issuing entity”. |
Depositor |
|
Item 6.01- ABS Informational and Computational Material |
Depositor |
|
Item 6.02- Change of Servicer or Trust Administrator Requires disclosure of any removal, replacement, substitution or addition of any master servicer, affiliated servicer, other servicer servicing 10% or more of pool assets at time of report, other material servicers or trustee. |
Master Servicer/Trust Administrator/Depositor/ Servicer/Trustee |
|
Reg AB disclosure about any new servicer or master servicer is also required. |
Servicer/Master Servicer/Depositor |
|
Reg AB disclosure about any new Trustee is also required. |
Trustee |
|
Item 6.03- Change in Credit Enhancement or External Support Covers termination of any enhancement in manner other than by its terms, the addition of an enhancement, or a material change in the enhancement provided. Applies to external credit enhancements as well as derivatives. |
Depositor/Trust Administrator |
|
U-2 |
|
Reg AB disclosure about any new enhancement provider is also required. |
Depositor |
|
Item 6.04- Failure to Make a Required Distribution |
Trust Administrator |
|
Item 6.05- Securities Act Updating Disclosure If any material pool characteristic differs by 5% or more at the time of issuance of the securities from the description in the final prospectus, provide updated Reg AB disclosure about the actual asset pool. |
Depositor |
|
If there are any new servicers or originators required to be disclosed under Regulation AB as a result of the foregoing, provide the information called for in Items 1108 and 1110 respectively. |
Depositor |
|
Item 7.01- Reg FD Disclosure |
All parties (as to themselves) |
|
Item 8.01- Other Events Any event, with respect to which information is not otherwise called for in Form 8-K, that the registrant deems of importance to certificateholders. |
Depositor |
|
Item 9.01- Financial Statements and Exhibits |
Responsible party for reporting/disclosing the financial statement or exhibit |
|
U-3 |
EXHIBIT V
FORM OF BACK-UP CERTIFICATION
|
|
Re: |
The Pooling And Servicing Agreement, dated as of July 1, 2006 (the “Agreement”), by and among by and among Credit Suisse First Boston Mortgage Securities Corp., as depositor (the “Depositor”), DLJ Mortgage Capital, Inc. (“DLJMC”), a Delaware corporation, as seller (“Seller”), Xxxxx Fargo Bank, N.A. (“Xxxxx Fargo”), a national banking association, in its capacity as a servicer (a “Servicer”), as master servicer (the “Master Servicer”) and as trust administrator (the “Trust Administrator”), Select Portfolio Servicing, Inc. (“SPS”), a Utah corporation, in its capacity as a servicer (a “Servicer”) and in its capacity as special servicer (the “Special Servicer”), and U.S. Bank National Association, a national banking association, as trustee (the “Trustee”). |
I, _______________________, the ________________________ of [NAME OF COMPANY] (the “Company”), certify to the Depositor, the Master Servicer, the Trust Administrator, and their officers, with the knowledge and intent that they will rely upon this certification, that:
(1) I have reviewed (i) the servicer compliance statement of the Company provided in accordance with Section 14.05 of the Agreement (the “Compliance Statement”), (ii) the report on assessment of the Company’s compliance with the servicing criteria provided in accordance with Section 14.06 of the Agreement, (iii) the registered public accounting firm’s attestation report provided in accordance with Section 14.07 of the Agreement (the “Attestation Report”), and all servicing reports, officer’s certificates and other information relating to the servicing of the Mortgage Loans by the Company during 200o that were delivered by the Company to the Trust Administrator pursuant to the Agreement (collectively, the “Company Servicing Information”);
(2) Based, on my knowledge, the Company Servicing Information, taken as a whole, does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in the light of the circumstances under which such statements were made, not misleading with respect to the period of time covered by the Company Servicing Information;
(3) Based on my knowledge, all of the Company Servicing Information required to be provided by the Company under the Agreement has been provided to the Trust Administrator;
(4) I am responsible for reviewing the activities performed by the Company as servicer under the Agreement, and based on my knowledge and the compliance review conducted in preparing the Compliance Statement and except as disclosed in the Compliance Statement, the Servicing Assessment or the Attestation Report, the Company has fulfilled its obligations under the Agreement in all material respects; and
(5) The Compliance Statement required to be delivered by the Company pursuant to the Agreement, and the Servicing Assessment and Attestation Report required to be provided by the Company and any Sub-Servicer or Subcontractor pursuant to the Agreement, have been provided to Trust Administrator. Any material instances of noncompliance described in such reports have been disclosed to Trust Administrator. Any material instance of noncompliance with the Servicing Criteria has been disclosed in such reports.
|
V-1 |
By:
Name:
Title
Date:
|
V-2 |
EXHIBIT W
ADDITIONAL DISCLOSURE NOTIFICATION
Xxxxx Fargo Bank, N.A.
Old Annapolis Road
Columbia, Maryland 21045
Fax: (000) 000-0000
Email: xxx.xxx.xxxxxxxxxxxxx@xxxxxxxxxx.xxx
Attn: Corporate Trust Services- CSFBMSC, Adjustable Rate Mortgage Trust 2006-3, Adjustable Rate Mortgage-Backed Pass-Through Certificates, Series 2006-3–SEC REPORT PROCESSING
Credit Suisse First Boston Mortgage Securities Corp.
Xxxxxx Xxxxxxx Xxxxxx
New York, New York 10010
RE: **Additional Form [10-D][10-K][8-K] Disclosure** Required
Ladies and Gentlemen:
In accordance with Article XIV of the Pooling and Servicing Agreement, dated as of July 1, 2006, by and among Credit Suisse First Boston Mortgage Securities Corp., as depositor (the “Depositor”), DLJ Mortgage Capital, Inc. (“DLJMC”), a Delaware corporation, as seller (“Seller”), Xxxxx Fargo Bank, N.A. (“Xxxxx Fargo”), a national banking association, in its capacity as a servicer (a “Servicer”), as master servicer (the “Master Servicer”) and as trust administrator (the “Trust Administrator”), Select Portfolio Servicing, Inc. (“SPS”), a Utah corporation, in its capacity as a servicer (a “Servicer”) and in its capacity as special servicer (the “Special Servicer”), and U.S. Bank National Association, a national banking association, as trustee (the “Trustee”), the undersigned, as [ ], hereby notifies you that certain events have come to our attention that [will] [may] need to be disclosed on Form [10-D] [ 10-K] [8-K].
Description of Additional Form [10-D][10-K][8-K] Disclosure:
List of any Attachments hereto to be included in the Additional Form [10-D][ 10-K][8-K] Disclosure:
Any inquiries related to this notification should be directed to [ ], phone number: [ ]; email address: [ ].
[NAME OF PARTY],
as [role]
|
|
By: |
|
Name:
Title:
|
W-1 |
EXHIBIT X
[RESERVED]
|
X-1 |
EXHIBIT Y
ADDITIONAL FORM 10-K DISCLOSURE
|
ADDITIONAL FORM 10-K DISCLOSURE | |
|
Item on Form 10-K |
Party Responsible |
|
Item 1B: Unresolved Staff Comments |
Depositor |
|
Item 9B: Other Information Disclose any information required to be reported on Form 8-K during the fourth quarter covered by the Form 10-K but not reported |
Any party responsible for disclosure items on Form 8-K |
|
Item 15: Exhibits, Financial Statement Schedules |
Trust Administrator Depositor |
|
Reg AB Item 1112(b): Significant Obligors of Pool Assets |
|
|
Significant Obligor Financial Information* |
Depositor |
|
*This information need only be reported on the Form 10-D for the distribution period in which updated information is required pursuant to the Item. |
|
|
Reg AB Item 1114(b)(2): Credit Enhancement Provider Financial Information |
|
|
• Determining applicable disclosure threshold |
Depositor |
|
• Requesting required financial information (including any required accountants’ consent to the use thereof) or effecting incorporation by reference |
Depositor
|
|
*This information need only be reported on the Form 10-D for the distribution period in which updated information is required pursuant to the Items. |
|
|
Reg AB Item 1115(b): Derivative Counterparty Financial Information |
|
|
• Determining current maximum probable exposure |
Depositor |
|
• Determining current significance percentage |
Depositor |
|
• Requesting required financial information (including any required accountants’ consent to the use thereof) or effecting incorporation by reference |
Depositor |
|
*This information need only be reported on the Form 10-D for the distribution period in which updated information is required pursuant to the Items. |
|
|
Y-1 |
|
Reg AB Item 1117: Legal Proceedings Any legal proceeding pending against the following entities or their respective property, that is material to Certificateholders, including any proceeding sknown to be contemplated by governmental authorities: |
|
|
• Issuing Entity (Trust Fund) |
Trustee, Master Servicer, Trust Administrator and Depositor |
|
• Sponsor (Seller) |
Seller (if a party to the Pooling and Servicing Agreement) or Depositor |
|
• Depositor |
Depositor |
|
• Trustee |
Trustee |
|
• Trust Administrator |
Trust Administrator |
|
• Master Servicer |
Master Servicer |
|
• Custodian |
Custodian |
|
• 1110(b) Originator |
Depositor |
|
• Any 1108(a)(2) Servicer (other than the Master Servicer or Trust Administrator) |
Servicer |
|
• Any other party contemplated by 1100(d)(1) |
Depositor |
|
Reg AB Item 1119: Affiliations and Relationships |
|
|
Whether (a) the Sponsor (Seller), Depositor or Issuing Entity is an affiliate of the following parties, and (b) to the extent known and material, any of the following parties are affiliated with one another:
|
Depositor as to (a) Sponsor/Seller as to (a) |
|
• Master Servicer |
Master Servicer |
|
• Trust Administrator |
Trust Administrator |
|
• Trustee |
Trustee |
|
• Any other 1108(a)(3) servicer |
Servicer |
|
• Any 1110 Originator |
Depositor/Sponsor |
|
• Any 1112(b) Significant Obligor |
Depositor/Sponsor |
|
• Any 1114 Credit Enhancement Provider |
Depositor/Sponsor |
|
• Any 1115 Derivate Counterparty Provider |
Depositor/Sponsor |
|
• Any other 1101(d)(1) material party |
Depositor/Sponsor |
|
Y-2 |
|
Whether there are any “outside the ordinary course business arrangements” other than would be obtained in an arm’s length transaction between (a) the Sponsor (Seller), Depositor or Issuing Entity on the one hand, and (b) any of the following parties (or their affiliates) on the other hand, that exist currently or within the past two years and that are material to a Certificateholder’s understanding of the Certificates: |
Depositor as to (a) Sponsor/Seller as to (a) |
|
• Master Servicer |
Master Servicer |
|
• Trust Administrator |
Trust Administrator |
|
• Trustee |
Trustee |
|
• Any other 1108(a)(3) servicer |
Servicer |
|
• Any 1110 Originator |
Depositor/Sponsor |
|
• Any 1112(b) Significant Obligor |
Depositor/Sponsor |
|
• Any 1114 Credit Enhancement Provider |
Depositor/Sponsor |
|
• Any 1115 Derivate Counterparty Provider |
Depositor/Sponsor |
|
• Any other 1101(d)(1) material party |
Depositor/Sponsor |
|
Whether there are any specific relationships involving the transaction or the pool assets between (a) the Sponsor (Seller), Depositor or Issuing Entity on the one hand, and (b) any of the following parties (or their affiliates) on the other hand, that exist currently or within the past two years and that are material: |
Depositor as to (a) Sponsor/Seller as to (a) |
|
• Master Servicer |
Master Servicer |
|
• Trust Administrator |
Trust Administrator |
|
• Trustee |
Trustee |
|
• Any other 1108(a)(3) servicer |
Servicer |
|
• Any 1110 Originator |
Depositor/Sponsor |
|
• Any 1112(b) Significant Obligor |
Depositor/Sponsor |
|
• Any 1114 Credit Enhancement Provider |
Depositor/Sponsor |
|
• Any 1115 Derivate Counterparty Provider |
Depositor/Sponsor |
|
• Any other 1101(d)(1) material party |
Depositor/Sponsor |
|
Y-3 |
EXHIBIT Z
FORM OF CERTIFICATION
REGARDING SUBSTITUTION OF DEFECTIVE MORTGAGE LOANS
OFFICER'S CERTIFICATE OF DLJ MORTGAGE CAPITAL, INC.
[__________], 2005
I, ____________, hereby certify that I am the duly authorized officer of DLJ Mortgage Capital, Inc., a Delaware corporation (“DLJMC”), and further certify that each of the Mortgage Loans substituted by DLJMC on _______________, 20[___] were in violation of the terms of the Mortgages related thereto.
Capitalized terms used but not defined herein have the meanings ascribed to them in the Pooling and Servicing Agreement dated as of July 1, 2006, among Credit Suisse First Boston Mortgage Securities Corp., as depositor, DLJ Mortgage Capital, Inc., as seller, Select Portfolio Servicing, Inc., as a servicer and as special servicer, U.S. Bank National Association, as trustee, and Xxxxx Fargo Bank, N.A., as a servicer, master servicer and trust administrator (the “Pooling and Servicing Agreement”).
DLJ MORTGAGE CAPITAL, INC.
____________________________________
|
|
Name: | |
|
|
Title: |
|
|
Z-1 |
SCHEDULE I
MORTGAGE LOAN SCHEDULE
(Provided Upon Request)
|
I-1 |
SCHEDULE IIA
Representations and Warranties of Seller – DLJ Mortgage Capital, Inc.
DLJMC Mortgage Capital, Inc. (“DLJ”), in its capacity as Seller, hereby makes the representations and warranties set forth in this Schedule IIA to the Depositor, the Trustee and the Trust Administrator, as of the Closing Date, or if so specified herein, as of the Cut off Date or such other date as may be specified. Capitalized terms used but not defined herein shall have the meanings assigned thereto in the Pooling and Servicing Agreement dated as of July 1, 2006, among Credit Suisse First Boston Mortgage Securities Corp., as depositor, DLJ Mortgage Capital, Inc., as seller, Select Portfolio Servicing, Inc., as a servicer and as special servicer, U.S. Bank National Association, as trustee, and Xxxxx Fargo Bank, N.A., as a servicer, master servicer and trust administrator (the “Agreement”). DLJMC is a corporation duly organized, validly existing and in good standing under the laws of the state of its incorporation;
(i) DLJMC has full corporate power to own its property, to carry on its business as presently conducted and to enter into and perform its obligations under this Agreement;
(ii) the execution and delivery by DLJMC of this Agreement have been duly authorized by all necessary corporate action on the part of DLJMC; and neither the execution and delivery of this Agreement, nor the consummation of the transactions herein contemplated hereby, nor compliance with the provisions hereof, will conflict with or result in a breach of, or constitute a default under, any of the provisions of any law, governmental rule, regulation, judgment, decree or order binding on DLJMC or its properties or the certificate of incorporation or by-laws of DLJMC, except those conflicts, breaches or defaults which would not reasonably be expected to have a material adverse effect on DLJMC’s ability to enter into this Agreement and to consummate the transactions contemplated hereby;
(iii) the execution, delivery and performance by DLJMC of this Agreement and the consummation of the transactions contemplated hereby do not require the consent or approval of, the giving of notice to, the registration with, or the taking of any other action in respect of, any state, federal or other governmental authority or agency, except those consents, approvals, notices, registrations or other actions as have already been obtained, given or made and, in connection with the recordation of the Mortgages, powers of attorney or assignments of Mortgages not yet completed;
(iv) this Agreement has been duly executed and delivered by DLJMC and, assuming due authorization, execution and delivery by the Trustee, the Trust Administrator, the Master Servicer, the Servicers, the Special Servicer and the Depositor, constitutes a valid and binding obligation of DLJMC enforceable against it in accordance with its terms (subject to applicable bankruptcy and insolvency laws and other similar laws affecting the enforcement of the rights of creditors generally); and
(v) to the knowledge of DLJMC, there are no actions, litigation, suits or proceedings pending or threatened against DLJMC before or by any court, administrative agency, arbitrator or governmental body (i) with respect to any of the transactions contemplated by this Agreement or (ii) with respect to any other matter which in the judgment of DLJMC if determined adversely to DLJMC would reasonably be expected to materially and adversely affect DLJMC’s ability to perform its obligations under this Agreement; and DLJMC is not in default with respect to any order of any court, administrative agency, arbitrator or governmental body so as to materially and adversely affect the transactions contemplated by this Agreement.
|
|
IIA-1 |
SCHEDULE IIB
Representations and Warranties of Master Servicer – Xxxxx Fargo Bank, X.X.
Xxxxx Fargo Bank, N.A. (“Xxxxx Fargo”), in its capacity as Master Servicer, hereby makes the representations and warranties set forth in this Schedule IIB to the Depositor, the Trust Administrator and the Trustee, as of the Closing Date, or if so specified herein, as of the Cut-off Date or such other date as may be specified.
(i) Xxxxx Fargo is a national banking association duly formed, validly existing and in good standing and is qualified under the laws of each state where required by applicable law or is otherwise exempt under applicable law from such qualification.
(ii) Xxxxx Fargo has all requisite organizational power, authority and capacity to enter into the Agreement and to perform the obligations required of it thereunder. The Agreement (assuming the due authorization and execution of the Agreement by the other parties thereto) constitutes a valid and legally binding agreement of Xxxxx Fargo enforceable in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, moratorium, reorganization and similar laws, and by equitable principles affecting the enforceability of the rights of creditors.
(iii) None of the execution and delivery of the Agreement, the consummation of any other transaction contemplated therein, or the fulfillment of or compliance with the terms of the Agreement, will result in the breach of, or constitute a default under, any term or provision of the organizational documents of Xxxxx Fargo or conflict with, result in a material breach, violation or acceleration of or constitute a material default under, the terms of any indenture or other agreement or instrument to which Xxxxx Fargo is a party or by which it is bound, or any statute, order, judgment, or regulation applicable to Xxxxx Fargo of any court, regulatory body, administrative agency or governmental body having jurisdiction over Xxxxx Fargo.
(iv) There is no action, suit, proceeding or investigation pending, or to Xxxxx Fargo’s knowledge threatened, against Xxxxx Fargo before any court, administrative agency or other tribunal (a) asserting the invalidity of the Agreement, (b) seeking to prevent the consummation of any of the transactions contemplated thereby or (c) which might materially and adversely affect the performance by Xxxxx Fargo of its obligations under, or the validity or enforceability of, the Agreement.
(v) No consent, approval, authorization or order of any court, regulatory body or governmental agency or court is required, under state or federal law prior to the execution, delivery and performance by Xxxxx Fargo of the Agreement or the consummation of the transactions contemplated by the Agreement.
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IIB-1 |
SCHEDULE IIC
Representations and Warranties of Servicer and Special Servicer – Select Portfolio Servicing, Inc.
Select Portfolio Servicing, Inc. (“SPS”), in its capacities as Servicer and Special Servicer, hereby makes the representations and warranties set forth in this Schedule IIC to the Depositor, the Trustee, the Trust Administrator and the Master Servicer, as of the Closing Date, or if so specified herein, as of the Cut-off Date or such other date as may be specified.
(i) SPS is a corporation duly formed, validly existing and in good standing under the laws of the jurisdiction of its incorporation and is qualified under the laws of each state where required by applicable law or is otherwise exempt under applicable law from such qualification.
(ii) SPS has all requisite corporate power, authority and capacity to enter into the Agreement and to perform the obligations required of it thereunder. The Agreement (assuming the due authorization and execution of the Agreement by the other parties thereto) constitutes a valid and legally binding agreement of SPS enforceable in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, moratorium, reorganization and similar laws, and by equitable principles affecting the enforceability of the rights of creditors.
(iii) None of the execution and delivery of the Agreement, the consummation of any other transaction contemplated therein, or the fulfillment of or compliance with the terms of the Agreement, will result in the breach of, or constitute a default under, any term or provision of the organizational documents of SPS or conflict with, result in a material breach, violation or acceleration of or constitute a material default under, the terms of any indenture or other agreement or instrument to which SPS is a party or by which it is bound, or any statute, order, judgment, or regulation applicable to SPS of any court, regulatory body, administrative agency or governmental body having jurisdiction over SPS.
(iv) There is no action, suit, proceeding or investigation pending, or to SPS’s knowledge threatened, against SPS before any court, administrative agency or other tribunal (a) asserting the invalidity of the Agreement, (b) seeking to prevent the consummation of any of the transactions contemplated thereby or (c) which might reasonably be expected to materially and adversely affect the performance by SPS of its obligations under, or the validity or enforceability of, the Agreement.
(v) No consent, approval, authorization or order of any court, regulatory body or governmental agency or court is required, under state or federal law prior to the execution, delivery and performance by SPS of the Agreement or the consummation of the transactions contemplated by the Agreement.
(vi) With respect to each SPS Serviced Mortgage Loan and to the extent SPS has serviced any of the SPS Serviced Mortgage Loans prior to the date of the Agreement, SPS has fully furnished, in accordance with the Fair Credit Reporting Act and its implementing regulations, accurate and complete information (e.g., favorable and unfavorable) on its borrower credit files to Equifax, Experian and Trans Union Credit Information Company, on a monthly basis.
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IIC-1 |
SCHEDULE IID
Representations and Warranties of Servicer – Xxxxx Fargo Bank, X.X.
Xxxxx Fargo Bank, N.A. (“Xxxxx Fargo”), in its capacity as Servicer, hereby makes the representations and warranties set forth in this Schedule IID to the Depositor, the Trustee and the Trust Administrator, as of the Closing Date, or if so specified herein, as of the Cut-off Date or such other date as may be specified.
(i) Xxxxx Fargo is a national banking association duly organized and in good standing under the laws of the United States and is qualified under the laws of each state where required by applicable law or is otherwise exempt under applicable law from such qualification.
(ii) Xxxxx Fargo has all requisite corporate power, authority and capacity to enter into the Agreement and to perform the obligations required of it thereunder. The Agreement (assuming the due authorization and execution of the Agreement by the other parties thereto) constitutes a valid and legally binding agreement of Xxxxx Fargo enforceable in accordance with its terms, except as such enforceability may be limited by liquidation, conservatorship and similar laws administered by the FDIC affecting the contract obligations of insured banks, and by equitable principles affecting the enforceability of the rights of creditors.
(iii) None of the execution and delivery of the Agreement, the consummation of any other transaction contemplated therein, or the fulfillment of or compliance with the terms of the Agreement, will result in the breach of, or constitute a default under, any term or provision of the organizational documents of Xxxxx Fargo or conflict with, result in a material breach, violation or acceleration of or constitute a material default under, the terms of any indenture or other agreement or instrument to which Xxxxx Fargo is a party or by which it is bound, or any statute, order, judgment, or regulation applicable to Xxxxx Fargo of any court, regulatory body, administrative agency or governmental body having jurisdiction over Xxxxx Fargo.
(iv) There is no action, suit, proceeding or investigation pending, or to Xxxxx Fargo’s knowledge threatened, against Xxxxx Fargo before any court, administrative agency or other tribunal (a) asserting the invalidity of the Agreement, (b) seeking to prevent the consummation of any of the transactions contemplated thereby or (c) which might materially and adversely affect the performance by Xxxxx Fargo of its obligations under, or the validity or enforceability of, the Agreement.
(v) No consent, approval, authorization or order of any court, regulatory body or governmental agency or court is required, under state or federal law prior to the execution, delivery and performance by Xxxxx Fargo of the Agreement or the consummation of the transactions contemplated by the Agreement.
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IID-1 |
SCHEDULE IIE
Representations and Warranties of Servicer – GreenPoint Mortgage Funding, Inc.
GreenPoint, in its capacity as Servicer, hereby makes the representations and warranties set forth in this Schedule IIE to the Depositor, the Trustee, the Trust Administrator and the Master Servicer, as of the Closing Date, or if so specified herein, as of the Cut-off Date or such other date as may be specified.
(i) GreenPoint is a corporation duly formed, validly existing and in good standing under the laws of the jurisdiction of its incorporation and is qualified under the laws of each state where required by applicable law or is otherwise exempt under applicable law from such qualification.
(ii) GreenPoint has all requisite corporate power, authority and capacity to enter into the Agreement and to perform the obligations required of it thereunder. The Agreement (assuming the due authorization and execution of the Agreement by the other parties thereto) constitutes a valid and legally binding agreement of GreenPoint enforceable in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, moratorium, reorganization and similar laws, and by equitable principles affecting the enforceability of the rights of creditors.
(iii) None of the execution and delivery of the Agreement, the consummation of any other transaction contemplated therein, or the fulfillment of or compliance with the terms of the Agreement, will result in the breach of, or constitute a default under, any term or provision of the organizational documents of GreenPoint or conflict with, result in a material breach, violation or acceleration of or constitute a material default under, the terms of any indenture or other agreement or instrument to which GreenPoint is a party or by which it is bound, or any statute, order, judgment, or regulation applicable to GreenPoint of any court, regulatory body, administrative agency or governmental body having jurisdiction over GreenPoint.
(iv) There is no action, suit, proceeding or investigation pending, or to GreenPoint’s knowledge threatened, against GreenPoint before any court, administrative agency or other tribunal (a) asserting the invalidity of the Agreement, (b) seeking to prevent the consummation of any of the transactions contemplated thereby or (c) which might reasonably be expected to materially and adversely affect the performance by GreenPoint of its obligations under, or the validity or enforceability of, the Agreement.
(v) No consent, approval, authorization or order of any court, regulatory body or governmental agency or court is required, under state or federal law prior to the execution, delivery and performance by XxxxxXxxxx of the Agreement or the consummation of the transactions contemplated by the Agreement.
(vi) With respect to each GreenPoint Serviced Mortgage Loan, GreenPoint has fully furnished, in accordance with the Fair Credit Reporting Act and its implementing regulations, accurate and complete information (e.g., favorable and unfavorable) on its borrower credit files to Equifax, Experian and Trans Union Credit Information Company, on a monthly basis.
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IIE-1 |
SCHEDULE III
Representations and Warranties of DLJMC – Mortgage Loans
DLJMC, in its capacity as Seller, hereby makes the representations and warranties set forth in this Schedule III to the Depositor, the Trustee and the Trust Administrator, as of the Closing Date, or if so specified herein, as of the Cut off Date or such other date as may be specified, with respect to the Mortgage Loans identified on Schedule I hereto, except as specified herein.
(i) The information set forth in Schedule I, with respect to the Mortgage Loans, is complete, true and correct in all material respects;
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(ii) |
[Reserved]; |
(iii) No Mortgage Loan is 30 days or more contractually delinquent in payment and there are no material defaults under the terms of any Mortgage Loan;
(iv) All taxes, governmental assessments, insurance premiums, water, sewer and municipal charges, leasehold payments or ground rents which previously became due and owing have been paid, or escrow funds have been established in an amount sufficient to pay for every such escrowed item which remains unpaid and which has been assessed but is not yet due and payable;
(v) The terms of the Mortgage Note and the Mortgage have not been impaired, waived, altered or modified in any respect, except by written instruments which have been recorded or sent for recording to the extent any such recordation is required by law, or, necessary to protect the interest of the Depositor. No other instrument of waiver, alteration or modification has been executed, and no Mortgagor has been released, in whole or in part, from the terms thereof except in connection with an assumption agreement and which assumption agreement is part of the Mortgage File and the terms of which are reflected in Schedule IA; the substance of any such waiver, alteration or modification has been approved by the issuer of any related Mortgage Guaranty Insurance Policy and title insurance policy, to the extent required by the related policies;
(vi) The Mortgage Note and the Mortgage are not subject to any right of rescission, set-off, counterclaim or defense, including, without limitation, the defense of usury, nor will the operation of any of the terms of the Mortgage Note or the Mortgage, or the exercise of any right thereunder, render the Mortgage Note or Mortgage unenforceable, in whole or in part, or subject to any right of rescission, set-off, counterclaim or defense, including the defense of usury, and no such right of rescission, set-off, counterclaim or defense has been asserted with respect thereto;
(vii) All buildings or other customarily insured improvements upon the Mortgaged Property are insured by an insurer acceptable under the FNMA Guides, against loss by fire, hazards of extended coverage and such other hazards as are provided for in the FNMA Guides or by FHLMC, as well as all additional requirements set forth in Section 4.10 of this Agreement. All such standard hazard policies are in full force and effect and on the date of origination contained a standard mortgagee clause naming DLJMC and its successors in interest and assigns as loss payee and such clause is still in effect and all premiums due thereon have been paid. If required by the Flood Disaster Protection Act of 1973, as amended, the Mortgage Loan is covered by a flood insurance policy meeting the requirements of the current guidelines of the Federal Insurance Administration which policy conforms to FNMA and FHLMC requirements, as well as
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III-1 |
all additional requirements set forth in Section 4.10 of this Agreement. Such policy was issued by an insurer acceptable under FNMA or FHLMC guidelines. The Mortgage obligates the Mortgagor thereunder to maintain all such insurance at the Mortgagor’s cost and expense, and on the Mortgagor’s failure to do so, authorizes the holder of the Mortgage to maintain such insurance at the Mortgagor’s cost and expense and to seek reimbursement therefor from the Mortgagor;
(viii)Each Mortgage Loan at the time it was made complied in all material respects with all applicable local, state and federal laws, including, without limitation, usury, equal credit opportunity, disclosure, recording and all applicable predatory and abusive lending laws;
(ix) The related Mortgage is a valid, subsisting, enforceable and perfected first lien on the Mortgaged Property, including for Mortgage Loans that are not Cooperative Loans, all buildings on the Mortgaged Property and all installations and mechanical, electrical, plumbing, heating and air conditioning systems affixed to such buildings, and all additions, alterations and replacements made at any time with respect to the foregoing securing the Mortgage Note’s original principal balance. The Mortgage and the Mortgage Note do not contain any evidence of any security interest or other interest or right thereto. Such lien is free and clear of all adverse claims, liens and encumbrances having priority over the first lien, as applicable, of the Mortgage subject only to (1) the lien of non-delinquent current real property taxes and assessments not yet due and payable, (2) covenants, conditions and restrictions, rights of way, easements and other matters of the public record as of the date of recording which are acceptable to mortgage lending institutions generally and either (A) which are referred to or otherwise considered in the appraisal made for the originator of the Mortgage Loan, or (B) which do not adversely affect the appraised value of the Mortgaged Property as set forth in such appraisal, and (3) other matters to which like properties are commonly subject which do not materially interfere with the benefits of the security intended to be provided by the Mortgage or the use, enjoyment, value or marketability of the related Mortgaged Property. Any security agreement, chattel mortgage or equivalent document related to and delivered in connection with the Mortgage Loan establishes and creates a valid, subsisting, enforceable and perfected first lien and first priority security interest on the property described therein, and the Seller has the full right to sell and assign the same to the Depositor;
(x) The Mortgage Note and the related Mortgage are original and genuine and each is the legal, valid and binding obligation of the maker thereof, enforceable in all respects in accordance with its terms subject to bankruptcy, insolvency, moratorium, reorganization and other laws of general application affecting the rights of creditors and by general equitable principles;
(xi) DLJMC or its affiliate is the sole owner of record and holder of the Mortgage Loan and the indebtedness evidenced by the Mortgage Note. Immediately prior to the transfer and assignment to the Depositor on the Closing Date, the Mortgage Loan, including the Mortgage Note and the Mortgage, were not subject to an assignment or pledge, and DLJMC had good and marketable title to and was the sole owner thereof and had full right to transfer and sell the Mortgage Loan to the Depositor free and clear of any encumbrance, equity, lien, pledge, charge, claim or security interest and has the full right and authority subject to no interest or participation of, or agreement with, any other party, to sell and assign the Mortgage Loan and following the sale of the Mortgage Loan, the Depositor will own such Mortgage Loan free and clear of any encumbrance, equity, participation interest, lien, pledge, charge, claim or security interest;
(xii) There are no mechanics’ or similar liens or claims which have been filed for work, labor or material (and no rights are outstanding that under law could give rise to such liens)
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III-2 |
affecting the related Mortgaged Property which are or may be liens prior to or equal to the lien of the related Mortgage;
(xiii)All improvements subject to the Mortgage which were considered in determining the appraised value of the Mortgaged Property lie wholly within the boundaries and building restriction lines of the Mortgaged Property (and wholly within the project with respect to a condominium unit) except for de minimis encroachments permitted by the FNMA Guide and which have been noted on the appraisal or the title policy affirmatively insures against loss or damage by reason of any violation, variation or encroachment adverse circumstances which is either disclosed or would have been disclosed by an accurate survey, and no improvements on adjoining properties encroach upon the Mortgaged Property except those which are insured against by the title insurance policy referred to in clause (v) above or are acceptable under FNMA or FHLMC guidelines and all improvements on the property comply with all applicable zoning and subdivision laws and ordinances;
(xiv)The Mortgaged Property is not subject to any material damage by waste, fire, earthquake, windstorm, flood or other casualty. At origination of the Mortgage Loan there was, and there currently is, no proceeding pending for the total or partial condemnation of the Mortgaged Property;
(xv) Each Mortgage Loan has been serviced in all material respects in compliance with accepted servicing practices;
(xvi)With respect to each Cooperative Loan, the related Mortgage is a valid, enforceable and subsisting first security interest on the related Cooperative Shares securing the related Mortgage Note, subject only to (a) liens of the Cooperative Property for unpaid assessments representing the Mortgagor’s pro rata share of the Cooperative Property’s payments for its blanket mortgage, current and future real property taxes, insurance premiums, maintenance fees and other assessments to which like collateral is commonly subject and (b) other matters to which like collateral is commonly subject which do not materially interfere with the benefits of the security intended to be provided by the Security Agreement. There are no liens against or security interest in the Cooperative Shares relating to each Cooperative Loan (except for unpaid maintenance, assessments and other amounts owed to the related Cooperative Property which individually or in the aggregate will not have a material adverse effect on such Cooperative Loan), which have priority over DLJMC’s security interest in such Cooperative Shares;
(xvii)The Mortgage Loan complies with all terms, conditions and requirements of the originator’s underwriting standards in effect at the time of origination of such Mortgage Loan;
(xviii) Each Mortgage Loan constitutes a qualified mortgage under Section 860G(a)(3)(A) of the Code and Treasury Regulations Section 1.860G-2(a)(1);
(xix)With respect to each Mortgage Loan sold by any Seller, to the knowledge of DLJMC, (i) no borrower obtained a prepaid single-premium credit insurance policy in connection with the origination of a Mortgage Loan, (ii) the related Servicer of each such Mortgage Loan has fully furnished, in accordance with the Fair Credit Reporting Act and its implementing regulations, accurate and complete information on its borrower credit files to Equifax, Experian and Trans Union Credit Information Company, on a monthly basis; (iii) no such Mortgage Loan will impose a Prepayment Penalty for a term in excess of five years; and (iv) with respect to any Mortgage Loans that are on manufactured housing, such housing will be the principal residence of the borrower upon origination of such mortgage loan;
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III-3 |
(xx) DLJMC has delivered or caused to be delivered to the Trustee or the Custodian on behalf of the Trustee the original Mortgage bearing evidence that such instruments have been recorded in the appropriate jurisdiction where the Mortgaged Property is located as determined by DLJMC (or in lieu of the original of the Mortgage or the assignment thereof, a duplicate or conformed copy of the Mortgage or the instrument of assignment, if any, together with a certificate of receipt from DLJMC or the settlement agent who handled the closing of the Mortgage Loan, certifying that such copy or copies represent true and correct copies represent true and correct copy(ies) of the originals) and that such original(s) have been or are currently submitted to be recorded in the appropriate governmental recording office of the jurisdiction where the Mortgaged Property is located or a certification or receipt of the recording authority evidencing the same;
(xxi)The Mortgage File contains each of the documents specified in Section 2.01(b) of this Agreement;
(xxii)No Mortgage Loan sold by the Seller secured by a Mortgaged Property located in the State of Georgia was originated on or after October 1, 2002 and before March 7, 2003 and no Mortgage Loan secured by Mortgaged Property located in the State of Georgia that was originated on or after March 7, 2003 is a “high cost home loan” as defined in the Georgia Fair Lending Act (HB 1361), as amended;
(xxiii) With respect to each Cooperative Loan, the Cooperative Shares that is pledged as security for the Cooperative Loan is held by a person as a tenant-stockholder (as defined in Section 216 of the Code) in a cooperative housing corporation (as defined in Section 216 of the Code);
(xxiv)None of the Mortgage Loans sold by the Seller are classified as (a) a “high cost mortgage” loan under the Home Ownership and Equity Protection Act of 1994 or (b) a “high cost home,” “covered,” “high cost,” “high risk home” or “predatory” loan under any other applicable state, federal or local law;
(xxv)With respect to each Mortgage Loan, (a) the Mortgage Loan was originated by a mortgagee approved by the Secretary of Housing and Urban Development pursuant to sections 203 and 211 of the National Housing Act, a savings and loan association, a savings bank, a commercial bank, credit union, insurance company or similar institution which is supervised and examined by a federal or state authority or (b) at the time the Mortgage Loan was originated, the originator was a mortgagee duly licensed as required by the State within which the Mortgage Loan was originated, and was subject to supervision and examination conducted by the applicable State authority of such State;
(xxvi)With respect to each Mortgage Loan that has a Prepayment Premium feature, each such Prepayment Premium is enforceable and, at the time such Mortgage Loan was originated, each Prepayment Premium complied with applicable federal, state and local law, subject to federal preemption where applicable;
(xxvii) The related Servicer of each Mortgage Loan sold by the Seller will fully furnish, in accordance with the Fair Credit Reporting Act and its implementing regulations, accurate and complete information on its borrower credit files to Equifax, Experian and Trans Union Credit Information Company, on a monthly basis;
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(xxviii) |
[Reserved]; |
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III-4 |
(xxix)With respect to the Group 3 Mortgage Loans, the original principal balance of each such Mortgage Loan is within Freddie Mac’s dollar amount limits for conforming one- to four-family Mortgage Loans;
(xxx)Each Mortgage Loan that is secured by residential real property (or a leasehold interest therein) has a loan-to-value ratio of 100% or less by Cut-Off Date Principal Balance;
(xxxi)No Mortgage Loan sold by the Seller is a “High Cost Loan” or “Covered Loan,” as applicable, as such terms are defined in the then current Standard & Poor’s LEVELS® Glossary which is now Version 5.7 Revised, Appendix E, in effect as of the Closing Date; and
(xxxii) With respect to any Mortgage Loan originated on or after August 1, 2004, neither the related Mortgage nor the related Mortgage Note requires the related Mortgagor to submit to arbitration to resolve any dispute arising out of or relating in any way to the Mortgage Loan.
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III-5 |
Appendix A
CALCULATION OF REMIC I Y PRINCIPAL REDUCTION AMOUNTS
REMIC I Y Principal Reduction Amounts: For any Distribution Date the amounts
by which the principal balances of the Class Y-1, Class Y-2, Class Y-3, Class Y-4 and Class
Y-5 Certificates respectively will be reduced on such distribution date by the allocation of
Realized Losses and the distribution of principal, determined as follows:
First for each of Group 1, Group 2, Group 3, Group 4 and Group 5 determine the weighted
average pass-through rate for that Group for distributions of interest that will be made on
the next succeeding Distribution Date (the "Group Interest Rate"). The Principal Reduction
Amount for each of the Class Y Certificates will be determined pursuant to the "Generic
solution for the REMIC I Y Principal Reduction Amounts" set forth below (the "Generic
Solution") by making identifications among the actual Groups and their related Class Y and
Class Z Certificates and weighted average pass-through rates and the Groups named in the
Generic Solution and their related Class Y and Class Z Certificates as follows:
A. Determine which Group has the lowest Group Interest Rate. That Group will be identified
with Group AA and the Class Y and Class Z Certificates related to that Group will be
respectively identified with the Class YAA and Class ZAA Certificates. The Group Interest
Rate for that Group will be identified with J%. If two or more Groups have the lowest Group
Interest Rate pick one for this purpose, subject to the restriction that each Group may be
picked only once in the course of any such selections pursuant to paragraphs A through E or
this definition.
B. Determine which Group has the second lowest Group Interest Rate. That Group will be
identified with Group BB and the Class Y and Class Z Certificates related to that Group will
be respectively identified with the Class BB and Class ZBB Certificates. The Group Interest
Rate for that Group will be identified with K%. If two or more Groups have the second
lowest Group Interest Rate pick one for this purpose, subject to the restriction that each
Group may be picked only once in the course of any such selections pursuant to paragraphs A
through E or this definition.
C. Determine which Group has the third lowest Group Interest Rate. That Group will be
identified with Group CC and the Class Y and Class Z Certificates related to that Group will
be respectively identified with the Class YCC and Class ZCC Certificates. The Group
Interest Rate for that Group will be identified with L%. If two or more Groups have the
third lowest Group Interest Rate pick one for this purpose, subject to the restriction that
each Group may be picked only once in the course of any such selections pursuant to
paragraphs A through E or this definition.
D. Determine which Group has the fourth lowest Group Interest Rate. That Group will be
identified with Group DD and the Class Y and Class Z Certificates related to that Group will
be respectively identified with the Class YDD and Class ZDD Certificates. The Group
Interest Rate for that Group will be identified with M%. If two or more Groups have the
fourth lowest Group Interest Rate pick one for this purpose, subject to the restriction that
each Group may be picked only once in the course of any such selections pursuant to
paragraphs A through E or this definition.
E. Determine which Group has the fifth lowest Group Interest Rate. That Group will be
identified with Group EE and the Class Y and Class Z Certificates related to that Group will
be respectively identified with the Class XXX and Class ZEE Certificates. The Group
Interest Rate for that Group will be identified with N%. If two or more Groups have the
fifth lowest Group Interest Rate pick one for this purpose, subject to the restriction that
each Group may be picked only once in the course of any such selections pursuant to
paragraphs A through E or this definition.
Second, apply the Generic Solution set forth below to determine the REMIC I Y Principal
Reduction Amounts for the Distribution Date using the identifications made above.
Generic Solution for the REMIC I Y Principal Reduction Amounts: For any
Distribution Date, the amounts by which the principal balances of the Class YAA, Class YBB,
Class YCC, Class YDD and Class XXX Certificates respectively will be reduced on such
Distribution Date by the allocation of Realized Losses and the distribution of principal,
determined as follows:
For purposes of the succeeding formulas the following symbols shall have the meanings set
forth below:
J% = the weighted average pass-through rate on the Group AA mortgage loans for interest to
be distributed on the next succeeding Distribution Date.
K% = the weighted average pass-through rate on the Group BB mortgage loans for interest to
be distributed on the next succeeding Distribution Date.
L% = the weighted average pass-through rate on the Group CC mortgage loans for interest to
be distributed on the next succeeding Distribution Date.
M% = the weighted average pass-through rate on the Group DD mortgage loans for interest to
be distributed on the next succeeding Distribution Date.
N% = the weighted average pass-through rate on the Group EE mortgage loans for interest to
be distributed on the next succeeding Distribution Date.
For purposes of the succeeding definitions and formulas, it is required that
J%<=K%<=L%<=M%<=N%.
PJB = the Group AA Subordinate Amount after the allocation of Realized Losses and
distributions of principal on such Distribution Date.
PKB = the Group BB Subordinate Amount after the allocation of Realized Losses and
distributions of principal on such Distribution Date.
PLB = the Group CC Subordinate Amount after the allocation of Realized Losses and
distributions of principal on such Distribution Date.
PMB = the Group DD Subordinate Amount after the allocation of Realized Losses and
distributions of principal on such Distribution Date.
PNB = the Group EE Subordinate Amount after the allocation of Realized Losses and
distributions of principal on such Distribution Date.
R = the Class CB Pass Through Rate
= (J%PJB + K%PKB + L%PLB + M%PMB + N%PNB)/(PJB + PKB + PLB + PMB + PNB)
R11 = the weighted average of the Group AA, Group BB, Group CC and Group DD Pass-Through
Rates after giving effect to the allocation of Realized Losses and distributions of
principal to be made on such Distribution Date
=
{J% (Pj - ΔPj) + K% (Pk - ΔPk) + L% (Pl - ΔPl) + M% (Pm - ΔPm)}/
(Pj - ΔPj + Pk - ΔPk + Pl - ΔPl + Pm - ΔPm)
R12 = the Group EE Pass-Through Rate
= N%
R21 = the weighted average of the Group AA, Group BB and Group CC Pass-Through Rates after
giving effect to the allocation of Realized Losses and distributions of principal to
be made on such Distribution Date
= {J% (Pj - ΔPj) + K% (Pk - ΔPk) + L% (Pl - ΔPl)
}/(Pj - ΔPj + Pk - ΔPk + Pl - ΔPl )
R22 = the weighted average of the Group DD and Group EE Pass-Through Rates
= { M% (Pm - ΔPm) + N% (Pn - ΔPn) }/( Pm - ΔPm + Pn - ΔPn )
R31 = the weighted average of the Group AA and Group BB Pass-Through Rates after giving
effect to the allocation of Realized Losses and distributions of principal to be made
on such Distribution Date
= {(J% (Pj - ΔPj) + K% (Pk - ΔPk) }/(Pj - ΔPj + Pk - ΔPk)
R32 = the weighted average of the Group CC, Group DD and Group EE Pass-Through Rates after
giving effect to the allocation of Realized Losses and distributions of principal to
be made on such Distribution Date
= { L% (Pl - ΔPl) + M% (Pm - ΔPm) + N% (Pn - ΔPn)
}/( Pl - ΔPl + Pm - ΔPm + Pn - ΔPn)
R41 = the Group AA Pass-Through Rates after giving effect to the allocation of Realized
Losses and distributions of principal to be made on such Distribution Date
= J%
R42 = the weighted average of the Group BB, Group CC, Group DD and Group EE Pass-Through
Rates after giving effect to the allocation of Realized Losses and distributions of
principal to be made on such Distribution Date
=
{K% (Pk - ΔPk) + L% (Pl - ΔPl) + M% (Pm - ΔPm) + N% (Pn - ΔPn) }/
( Pk - ΔPk + Pl - ΔPl + Pm - ΔPm + Pn - ΔPn )
r11 = the weighted average of the Class YAA, Class YBB, Class YCC and Class YDD
Pass-Through Rates
= (J% Yj + K% Yk + L% Yl + M% Ym )/(Yj + Yk + Yl + Ym )
r12 = the Class XXX Pass-Through Rate
= N%
r21 = the weighted average of the Class YAA, Class YBB and Class YCC Pass-Through Rates
= (J% Yj + K% Yk + L% Yl )/(Yj + Yk + Yl )
r22 = the weighted average of the Class YDD and Class XXX Pass-Through Rates
= ( M% Ym + N% Yn )/( Ym + Yn )
r31 = the weighted average of the Class YAA and Class YBB Pass-Through Rates
= (J% Yj + K% Yk )/(Yj + Yk )
r32 = the weighted average of the Class YCC, Class YDD and Class XXX Pass-Through Rates
= ( L% Yl + M% Ym + N% Yn)/( Yl + Ym + Yn )
r41 = the Class YAA Pass-Through Rate
= J%
r42 = the weighted average of the Class YBB, Class YCC, Class YDD and Class XXX
Pass-Through Rates
= (K% Yk + L% Yl + M% Ym + N% Yn )/(Yk + Yl + Ym + Yn )
Yj = the principal balance of the Class YAA Certificates after distributions on the prior
Distribution Date.
Yk = the principal balance of the Class YBB Certificates after distributions on the prior
Distribution Date.
Yl = the principal balance of the Class YCC Certificates after distributions on the prior
Distribution Date.
Ym = the principal balance of the Class YDD Certificates after distributions on the prior
Distribution Date.
Yn = the principal balance of the Class XXX Certificates after distributions on the prior
Distribution Date.
ΔYj = the Class YAA Principal Reduction Amount.
ΔYk = the Class YBB Principal Reduction Amount.
ΔYl = the Class YCC Principal Reduction Amount.
ΔYm = the Class YDD Principal Reduction Amount.
ΔYn = the Class XXX Principal Reduction Amount.
Zj = the principal balance of the Class ZAA Certificates after distributions on the prior
Distribution Date.
Zk = the principal balance of the Class ZBB Certificates after distributions on the prior
Distribution Date.
Zl = the principal balance of the Class ZCC Certificates after distributions on the prior
Distribution Date.
Zm = the principal balance of the Class ZDD Certificates after distributions on the prior
Distribution Date.
Zn = the principal balance of the Class ZEE Certificates after distributions on the prior
Distribution Date.
ΔZj = the Class ZAA Principal Reduction Amount.
ΔZk = the Class ZBB Principal Reduction Amount.
ΔZl = the Class ZCC Principal Reduction Amount.
ΔZm = the Class ZDD Principal Reduction Amount.
ΔZn = the Class ZEE Principal Reduction Amount.
Pj = the aggregate principal balance of the Class YAA and Class ZAA Certificates after
distributions on the prior Distribution Date.
= Yj + Zj
Pk = the aggregate principal balance of the Class YBB and Class ZBB Certificates after
distributions on the prior Distribution Date.
= Yk + Zk
Pl = the aggregate principal balance of the Class YCC and Class ZCC Certificates after
distributions on the prior Distribution Date.
= Yl + Zl =
Pm = the aggregate principal balance of the Class YAA and Class ZAA Certificates after
distributions on the prior Distribution Date.
= Ym + Zm
Pn = the aggregate principal balance of the Class YAA and Class ZAA Certificates after
distributions on the prior Distribution Date.
= Yn + Zn
ΔPj = the aggregate amount of principal reduction occurring with respect to the
Group AA mortgage loans from Realized Losses or payments of principal to be allocated
on such Distribution Date net of any such amounts allocated to the Class R-I
Certificate or to any class of principal only certificates created by ratio stripping
the mortgage loans of Group AA
= the aggregate of the Class YAA and Class ZAA Principal Reduction Amounts.
= ΔYj + ΔZj
ΔPk = the aggregate amount of principal reduction occurring with respect to the
Group BB mortgage loans from Realized Losses or payments of principal to be allocated
on such Distribution Date net of any such amounts allocated to the Class R-I
Certificate or to any class of principal only certificates created by ratio stripping
the mortgage loans of Group BB
= the aggregate of the Class YBB and Class ZBB Principal Reduction Amounts.
= ΔYk + ΔZk
ΔPl= the aggregate amount of principal reduction occurring with respect to the
Group CC mortgage loans from Realized Losses or payments of principal to be allocated
on such Distribution Date net of any such amounts allocated to the Class R-I
Certificate or to any class of principal only certificates created by ratio stripping
the mortgage loans of Group CC
= the aggregate of the Class YCC and Class ZCC Principal Reduction Amounts.
= ΔYl + ΔZl
ΔPm = the aggregate amount of principal reduction occurring with respect to the
Group DD mortgage loans from Realized Losses or payments of principal to be allocated
on such Distribution Date net of any such amounts allocated to the Class R-I
Certificate or to any class of principal only certificates created by ratio stripping
the mortgage loans of Group DD
= the aggregate of the Class YDD and Class ZDD Principal Reduction Amounts.
= ΔYm + ΔZm
ΔPn = the aggregate amount of principal reduction occurring with respect to the
Group EE mortgage loans from Realized Losses or payments of principal to be allocated
on such Distribution Date net of any such amounts allocated to the Class R-I
Certificate or to any class of principal only certificates created by ratio stripping
the mortgage loans of Group EE
= the aggregate of the Class XXX and Class ZEE Principal Reduction Amounts.
= ΔYn + ΔZn
α = .0005
γ1 = (R - R11)/(R12 - R). If R=>M%, γ1 is a non-negative number unless its
denominator is zero, in which event it is undefined.
γ2 = (R - R21)/(R22 - R). If R=>L%, γ2 is a non-negative number unless its
denominator is zero, in which event it is undefined.
γ3 = (R - R31)/(R32 - R). If R=>K%, γ3 is a non-negative number unless its
denominator is zero, in which event it is undefined.
γ4 = (R - R41)/(R42 - R). If R<K%, γ4 is a non-negative number unless its
denominator is zero, in which event it is undefined.
If γ1 is undefined, ΔYj = Yj, ΔYk = Yk, ΔYl = Yl, ΔYm = Ym and
ΔYn = (Yn/Pn)ΔPn.
If γ7 is zero, ΔYj = (Yj/Pj)ΔPj, ΔYk = Yk, ΔYl = Yl, ΔYm
= Ym and ΔYn = Yn.
In the remaining situations, ΔYj, ΔYk, ΔYl, ΔYm and ΔYn shall
be defined as follows:
I. If R=>M%, make the following additional definitions:
δ1Yj = 0, if R11> r11;
(R11- r11)( Yj + Yk + Yl + Ym)Yj/
{(R11 - J%)Yj + (R11 - K%)Yk + (R11 - L%)Yl +
(R11 - M%)Ym }, if R11=> r11 and R11=>M%;
(R11- r11)( Yj + Yk + Yl + Ym )Yj/
{(R11 - J%)Yj + (R11 - K%)Yk + (R11 - L%)Yl }, if R11=> r11 and
M%>R11=>L%;
(R11- r11)( Yj + Yk + Yl + Ym )Yj/
{(R11 - J%)Yj + (R11 - K%)Yk }, if R11=> r11 and
L%>R11=>K%; and
(R11- r11)( Yj + Yk + Yl + Ym )/(R11 - J%), if R11=> r11
and K%>R11=>J%.
δ1Yk = 0, if R11> r11 and
R11=>K%;
(R11- r11)( Yj + Yk + Yl + Ym)Yk/
{ (R11 - K%)Yk + (R11 - L%)Yl + (R11 - M%)Ym }, if R11> r11 and
R11<K%;
(R11- r11)( Yj + Yk + Yl + Ym )Yk/
{(R11 - J%)Yj + (R11 - K%)Yk + (R11 - L%)Yl +
(R11 - M%)Ym }, if R11=> r11 and R11=>M%;
(R11- r11)( Yj + Yk + Yl + Ym )Yk/
{(R11 - J%)Yj + (R11 - K%)Yk + (R11 - L%)Yl }, if R11=> r11 and
M%>R11=>L%;
(R11- r11)( Yj + Yk + Yl + Ym )Yk/{(R11 - J%)Yj + (R11 - K%)Yk }, if R11=> r11
and L%>R11=>K%; and
0, if R11=> r11 and R11<K%.
δ1Yl = 0, if R11> r11 and
R11=>L%;
(R11- r11)( Yj + Yk + Yl + Ym)Yl/
{ (R11 - L%)Yl + (R11 - M%)Ym }, if R11> r11 and
K%<=R11<L%;
(R11- r11)( Yj + Yk + Yl + Ym)Yl/
{ (R11 - K%)Yk + (R11 - L%)Yl + (R11 - M%)Ym }, if R11> r11 and
R11<K%;
(R11- r11)( Yj + Yk + Yl + Ym)Yl/
{(R11 - J%)Yj + (R11 - K%)Yk + (R11 - L%)Yl +
(R11 - M%)Ym }, if R11=> r11 and R11=>M%;
(R11- r11)( Yj + Yk + Yl + Ym )Yl/
{(R11 - J%)Yj + (R11 - K%)Yk + (R11 - L%)Yl }, if R11=> r11 and
M%>R11=>L%;
0, if R11=> r11 and R11<L%.
δ1Ym = 0, if R11> r11 and
R11=>M%;
(R11- r11)( Yj + Yk + Yl + Ym)/(R11 - M%), if R11> r11 and
L%<=R11<M%;
(R11- r11)( Yj + Yk + Yl + Ym)Ym/
{ (R11 - L%)Yl + (R11 - M%)Ym }, if R11> r11 and
K%<=R11<L%;
(R11- r11)( Yj + Yk + Yl + Ym)Ym/
{ (R11 - K%)Yk + (R11 - L%)Yl + (R11 - M%)Ym }, if R11> r11 and
R11<K%;
(R11- r11)( Yj + Yk + Yl + Ym + Yn + Yo +Yp )Ym/
{(R11 - J%)Yj + (R11 - K%)Yk + (R11 - L%)Yl +
(R11 - M%)Ym }, if R11=> r11 and R11=>M%;
0, if R11=> r11 and R11<M%.
δ1Yj, δ1Yk, δ1Yl and δ1Ym are numbers respectively between Yj, Yk,
Yl and Ym and 0 such that
{J%(Yj - δ1Yj ) + K%( Yk.- δ1Yk) + L%( Yl.- δ1Yl) + M%( Ym.-
δ1Ym) }/
(Yj - δ1Yj + Yk.- δ1Yk + Yl.- δ1Yl + Ym.- δ1Ym)
= R11.
Y11 = Yj - δ1Yj + Yk.- δ1Yk + Yl.- δ1Yl + Ym.- δ1Ym
P11 = Pj + Pk + Pl + Pm.
Z11 = Zj + Zk + Zl + Zm.
ΔY11 = ΔYj - δ1Yj + ΔYk.- δ1Yk + ΔYl.- δ1Yl + ΔYm.- δ1Ym .
ΔP11 = ΔPj + ΔPk + ΔPl + ΔPm.
ΔZ11 = ΔZj + ΔZk + ΔZl + ΔZm.
1. If Yn - α(Pn - ΔPn) => 0, Y11- α(P11 - ΔP11) => 0, and
γ1(P11 - ΔP11) < (Pn - ΔPn), then
ΔYn = Yn - αγ1(P11 - ΔP11) and
ΔY11 = Y11 - α(P11 - ΔP11).
2. If Yn - α(Pn - ΔPn) => 0, Y11 - α(P11 - ΔP11) => 0, and
γ1(P11 - ΔP11) => (Pn - ΔPn), then
ΔYn = Yn - α(Pn - ΔPn) and
ΔY11 = Y11 - (α/γ1)(Pn - ΔPn).
3. If Yn - α(Pn - ΔPn) < 0, Y11 - α(P11 - ΔP11) => 0, and
Y11 - α(P11 - ΔP11) => Y11 - (Yn/γ1), then
ΔYn = Yn - αγ1(P11 - ΔP11) and
ΔY11 = Y11 - α(P11 - ΔP11).
4. If Yn - α(Pn - ΔPn) < 0, Y11 - (Yn/γ1) => 0, and
Y11 - α(P11 - ΔP11) <= Y11 - (Yn/γ1), then ΔYn = 0 and
ΔY11 = Y11 - (Yn/γ1).
5. If Y11 - α(P11 - ΔP11) < 0, Y11 - (Yn/γ1) < 0, and
Yn - α(Pn - ΔPn) <= Yn - (γ1Y11), then ΔYn = Yn - (γ1Y11)
and ΔY11 = 0.
6. If Y11 - α(P11 - ΔP11) < 0, Yn - α(Pn - ΔPn) => 0, and
Yn - α(Pn - ΔPn) => Yn - (γ1Y11), then
ΔYn = Yn - α(Pn - ΔPn) and
ΔY11 = Y11 - (α/γ1)(Pn - ΔPn).
ΔYj = δ1Yj + [(Yj - δ1Yj )/Y11 ]Δ Y11
ΔYk = δ1Yk + [(Yk - δ1Yk )/Y11 ]ΔY11
ΔYl = δ1Yl + [(Yl - δ1Yl )/Y11 ]Δ Y11
ΔYm = δ1Ym + [(Ym - δ1Ym )/Y11 ]ΔY11
The purpose of the foregoing definitional provisions together with the related provisions
allocating Realized Losses and defining the Class Y and Class Z Principal Distribution
Amounts is to accomplish the following goals in the following order of priority:
1. Making the ratio of (Yn - ΔYn ) to (Y11 - ΔY11 ) equal to γ1 after taking
account of the allocation Realized Losses and the distributions that will be made
through the end of the Distribution Date to which such provisions relate and assuring
that the Principal Reduction Amount for each of the Class YAA, Class YBB, Class YCC,
Class YDD, Class XXX, Class ZAA, Class ZBB, Class ZCC, Class ZDD and Class ZEE
Certificates is greater than or equal to zero for such Distribution Date;
2. Making the Class YAA Principal Balance less than or equal to 0.0005 of the sum of the
Class YAA and Class ZAA Principal Balances, the Class YBB Principal Balance less than
or equal to 0.0005 of the sum of the Class YBB and Class ZBB Principal Balances, the
Class YCC Principal Balance less than or equal to 0.0005 of the sum of the Class YCC
and Class ZCC Principal Balances, the Class YDD Principal Balance less than or equal
to 0.0005 of the sum of the Class YDD and Class ZDD Principal Balances and the Class
XXX Principal Balance less than or equal to 0.0005 of the sum of the Class XXX and
Class ZEE Principal Balances in each case after giving effect to allocations of
Realized Losses and distributions to be made through the end of the Distribution Date
to which such provisions relate; and
3. Making the larger of (a) the fraction whose numerator is (Yn - ΔYn ) and whose
denominator is the sum of (Yn - ΔYn) and (Zn - ΔZn) and (b) the fraction whose
numerator is (Y11 - ΔY11) and whose denominator is the sum of (Y11 - ΔY11) and (Z11 -
ΔZ11) as large as possible while remaining less than or equal to 0.0005.
In the event of a failure of the foregoing portion of the definition of ClassY Principal
Reduction Amount to accomplish both of goals 1 and 2 above, the amounts thereof should be
adjusted to so as to accomplish such goals within the requirement that each REMIC I Y
Principal Reduction Amount must be less than or equal to the sum of (a) the Principal
Realized Losses to be allocated on the related Distribution Date for the related Pool
remaining after the allocation of such Realized Losses to the related class of ratio-strip
principal only certificates, if any, and (b) the remainder of the Available Distribution
Amount for the related Pool or after reduction thereof by the distributions to be made on
such Distribution Date (i) to the related class of ratio-strip principal only certificates,
if any, (ii) to the related class of ratio-strip interest only certificates, if any, and
(iii) in respect of interest on the related Class Y and Class Z Certificates, or, if both of
such goals cannot be accomplished within such requirement, such adjustment as is necessary
shall be made to accomplish goal 1 within such requirement. In the event of any conflict
among the provisions of the definition of the REMIC I Y Principal Reduction Amounts, such
conflict shall be resolved on the basis of the goals and their priorities set forth above
within the requirement set forth in the preceding sentence. If the formula allocation of
ΔY11 among ΔYj, ΔYk, ΔYl and ΔYm cannot be achieved because one or more of ΔYj, ΔYk, ΔYl and
ΔYm, as so defined is greater than the related one of ΔPj, ΔPk, ΔPl and ΔPm, such an
allocation shall be made as close as possible to the formula allocation within the
requirement that ΔYj < ΔPj, ΔYk < ΔPk, ΔYl < ΔPl, ΔYm < ΔPm and ΔYm < ΔPm.
II. If L%<=R<=M%, make the following additional definitions:
δ5Yj = 0, if R51> r51;
(R51- r51)( Yj + Yk + Yl )Yj/
{(R51 - J%)Yj + (R51 - K%)Yk }, if R51=> r51 and
L%>R51=>K%; and
(R51- r51)( Yj + Yk + Yl )/(R51 - J%), if R51=> r51 and
K%>R51=>J%.
δ5Yk = 0, if R51> r51 and
R51=>K%;
(R51- r51)( Yj + Yk + Yl )Yk/
{ (R51 - K%)Yk + (R51 - L%)Yl }, if R51> r51 and
R51<K%;
(R51- r51)( Yj + Yk + Yl )Yk/
{(R51 - J%)Yj + (R51 - K%)Yk }, if R51=> r51 and
L%>R51=>K%; and
0, if R51=> r51 and R51<K%.
δ5Yl = (R51- r51)( Yj + Yk + Yl )/(R51 - L%), if R51> r51
and K%<=R51<L%;
(R51- r51)( Yj + Yk + Yl )Yl/{ (R51 - K%)Yk + (R51 - L%)Yl }, if R51> r51
and R51<K%;
0, if R51=> r51.
δ5Ym = 0, if R52> r52;
(R52- r52)( Ym + Yn + Yo +Yp + Yq )/(R52 - M%), if R52=> r52 and
R52=>M%;
δ5Yn = the greater of 0 and ΔPn - Zn, if
R52=N%;
(R52- r52)( Ym + Yn)/(R52 - N%), if R52> r52 and
M%<=R52<N%;
0, if R52=> r52 and R52<N%.
δ5Yj, δ5Yk, δ5Yl, δ5Ym, δ5Yn, δ5Yo, δ5Yp and
δ5Yq are numbers respectively between Yj, Yk, Yl, Ym, Yn, Yo, Yp and Yq and 0
such that:
{J%(Yj - δ5Yj ) + K%( Yk.- δ5Yk) + L%( Yl.- δ5Yl)}/
( Yj - δ5Yj + Yk.- δ5Yk + Yl.- δ5Yl)
= R51;
and
{ M%( Ym.- δ5Ym) + N%( Yn.- δ5Yn) + O%( Yo.- δ5Yo) + P%(
Yp.- δ5Yp) + Q%(Yq - δ5Yq ) }/
(Ym.- δ5Ym + Yn.- δ5Yn + Yo.- δ5Yo + Yp.- δ5Yp
+ Yq - δ5Yq)
= R52.
Y51 = Yj - δ5Yj + Yk.- δ5Yk + Yl.- δ5Yl.
P51 = Pj + Pk + Pl.
Z51 = Zj + Zk + Zl.
ΔY51 = ΔYj - δ5Yj + ΔYk.- δ5Yk + ΔYl.- δ5Yl.
ΔP51 = ΔPj + ΔPk + ΔPl.
ΔZ51 = ΔZj + ΔZk + ΔZl.
Y52 = Ym.- δ5Ym + Yn.- δ5Yn.
P52 = Pm + Pn.
Z52 = Zm + Zn.
ΔY52 = ΔYm.- δ5Ym + ΔYn.- δ5Yn
ΔP52 = ΔPm + ΔPn.
ΔZ52 = ΔZm + ΔZn.
1. If Y52 - α(P52 - ΔP52) => 0, Y51- α(P51 - ΔP51) => 0, and
γ5(P51 - ΔP51) < (P52 - ΔP52), then
ΔY52 = Y52 - αγ5(P51 - ΔP51) and
ΔY51 = Y51 - α(P51 - ΔP51).
2. If Y52 - α(P52 - ΔP52) => 0, Y51 - α(P51 - ΔP51) => 0, and
γ5(P51 - ΔP51) => (P52 - ΔP52), then
ΔY52 = Y52 - α(P52 - ΔP52) and
ΔY51 = Y51 - (α/γ5)(P52 - ΔP52).
3. If Y52 - α(P52 - ΔP52) < 0, Y51 - α(P51 - ΔP51) => 0, and
Y51 - α(P51 - ΔP51) => Y51 - (Y52/γ5), then
ΔY52 = Y52 - αγ5(P51 - ΔP51) and
ΔY51 = Y51 - α(P51 - ΔP51).
4. If Y52 - α(P52 - ΔP52) < 0, Y51 - (Y52/γ5) => 0, and
Y51 - α(P51 - ΔP51) <= Y51 - (Y52/γ5), then ΔY52 = 0 and
ΔY51 = Y51 - (Y52/γ5).
5. If Y51 - α(P51 - ΔP51) < 0, Y51 - (Y52/γ5) < 0, and
Y52 - α(P52 - ΔP52) <= Y52 - (γ5Y51), then
ΔY52 = Y52 - (γ5Y51) and ΔY51 = 0.
6. If Y51 - α(P51 - ΔP51) < 0, Y52 - α(P52 - ΔP52) => 0, and
Y52 - α(P52 - ΔP52) => Y52 - (γ5Y51), then
ΔY52 = Y52 - α(P52 - ΔP52) and
ΔY51 = Y51 - (α/γ5)(P52 - ΔP52).
ΔYj = δ5Yj + [(Yj - δ5Yj )/Y51 ]ΔY51
ΔYk = δ5Yk + [(Yk - δ5Yk )/Y51 ]ΔY51
ΔYl = δ5Yl + [(Yl - δ5Yl )/Y51 ]ΔY51
ΔYm = δ5Ym + [(Ym - δ5Ym )/Y52 ]ΔY52
ΔYn = δ5Yn + [(Yn - δ5Yn )/Y52 ]ΔY52
ΔYo = δ5Yo + [(Yo - δ5Yo )/Y52 ]ΔY52
ΔYp = δ5Yp + [(Yp - δ5Yp )/Y52 ]ΔY52
ΔYq = δ5Yq + [(Yq - δ5Yq )/Y52 ]ΔY52
The purpose of the foregoing definitional provisions together with the related provisions
allocating Realized Losses and defining the Class Y and Class Z Principal Distribution
Amounts is to accomplish the following goals in the following order of priority:
1. Making the ratio of (Y52 - ΔY52 ) to (Y51 - ΔY51 ) equal to γ5 after
taking account of the allocation Realized Losses and the distributions that will be
made through the end of the Distribution Date to which such provisions relate and
assuring that the Principal Reduction Amount for each of the Class YAA, Class YBB,
Class YCC, Class YDD, Class XXX, Class YFF, Class YGG, Class YHH, Class ZAA, Class
ZBB, Class ZCC, Class ZDD, Class ZEE, Class ZFF, Class ZGG and Class ZHH Certificates
is greater than or equal to zero for such Distribution Date;
2. Making the Class YAA Principal Balance less than or equal to 0.0005 of the sum of the
Class YAA and Class ZAA Principal Balances, the Class YBB Principal Balance less than
or equal to 0.0005 of the sum of the Class YBB and Class ZBB Principal Balances, the
Class YCC Principal Balance less than or equal to 0.0005 of the sum of the Class YCC
and Class ZCC Principal Balances, the Class YDD Principal Balance less than or equal
to 0.0005 of the sum of the Class YDD and Class ZDD Principal Balances, the Class XXX
Principal Balance less than or equal to 0.0005 of the sum of the Class XXX and Class
ZEE Principal Balances, the Class YFF Principal Balance less than or equal to 0.0005
of the sum of the Class YFF and Class ZFF Principal Balances, the Class YGG Principal
Balance less than or equal to 0.0005 of the sum of the Class YGG and Class ZGG
Principal Balances and the Class YHH Principal Balance less than or equal to 0.0005
of the sum of the Class YHH and Class ZHH Principal Balances in each case after
giving effect to allocations of Realized Losses and distributions to be made through
the end of the Distribution Date to which such provisions relate; and
3. Making the larger of (a) the fraction whose numerator is (Y52 - ΔY52 ) and whose
denominator is the sum of (Y52 - ΔY52) and (Z52 - ΔZ52) and (b) the
fraction whose numerator is (Y51 - ΔY51) and whose denominator is the sum of
(Y51 - ΔY51) and (Z51 - ΔZ51) as large as possible while remaining less
than or equal to 0.0005.
In the event of a failure of the foregoing portion of the definition of ClassY Principal
Reduction Amount to accomplish both of goals 1 and 2 above, the amounts thereof should be
adjusted to so as to accomplish such goals within the requirement that each REMIC I Y
Principal Reduction Amount must be less than or equal to the sum of (a) the Principal
Realized Losses to be allocated on the related Distribution Date for the related Pool
remaining after the allocation of such Realized Losses to the related class of ratio-strip
principal only certificates, if any, and (b) the remainder of the Available Distribution
Amount for the related Pool or after reduction thereof by the distributions to be made on
such Distribution Date (i) to the related class of ratio-strip principal only certificates,
if any, (ii) to the related class of ratio-strip interest only certificates, if any, and
(iii) in respect of interest on the related Class Y and Class Z Certificates, or, if both of
such goals cannot be accomplished within such requirement, such adjustment as is necessary
shall be made to accomplish goal 1 within such requirement. In the event of any conflict
among the provisions of the definition of the REMIC I Y Principal Reduction Amounts, such
conflict shall be resolved on the basis of the goals and their priorities set forth above
within the requirement set forth in the preceding sentence. If the formula allocations of
ΔY51 among ΔYj, ΔYk and ΔYl or ΔY52 among ΔYm, ΔYn,
ΔYo, ΔYp and ΔYq cannot be achieved because one or more of ΔYj, ΔYk,
ΔYl, ΔYm, ΔYn, ΔYo, ΔYp and ΔYq, as so defined is greater than
the related one of ΔPj, ΔPk, ΔPl, ΔPm, ΔPn, ΔPo, ΔPp and
ΔPq, such an allocation shall be made as close as possible to the formula allocation
within the requirement that ΔYj < ΔPj, ΔYk < ΔPk, ΔYl < ΔPl,
ΔYm < ΔPm, ΔYn < ΔPn, ΔYo < ΔPo, ΔYp < ΔPp and
ΔYq < ΔPq.
VI. If K%<=R<=L%, make the following additional definitions:
δ6Yj = 0, if R61> r61; and
(R61- r61)( Yj + Yk )/(R61 - J%), if R61=> r61 and
K%>R61=>J%.
δ6Yk = (R61- r61)( Yj + Yk )/(R61 - K%), if R61> r61
and R61<K%; and
0, if R61=> r61 and R61<K%.
δ6Yl = 0, if R62> r62;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq )Yl/
{ (R62 - L%)Yl + (R62 - M%)Ym +
(R62 - N%)Yn + (R62 - O%)Yo + (R62 - P%)Yp }, if R62=> r62 and
R62=>P%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq )Yl/
{ (R62 - L%)Yl + (R62 - M%)Ym +
(R62 - N%)Yn + (R62 - O%)Yo}, if R62=> r62 and
P%>R62=>O%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq )Yl/
{ (R62 - L%)Yl + (R62 - M%)Ym + (R62 - N%)Yn }, if R62=> r62 and
O%>R62=>N%;
(R62- r62)( Yl + Ym + Yn + Yo +Yp + Yq )Yl/
{ (R62 - L%)Yl + (R62 - M%)Ym }, if R62=> r62 and
N%>R62=>M%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq )/(R62 - L%), if R62=> r62
and M%>R62=>L%;
δ6Ym = 0, if R62> r62 and
R62=>M%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq )Ym/
{ (R62 - M%)Ym + (R62 - N%)Yn + (R62 - O%)Yo +
(R62 - P%)Yp + (R62 - Q%)Yq }, if R62> r62 and
L%<=R62<M%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq )Ym/
{ (R62 - L%)Yl + (R62 - M%)Ym +
(R62 - N%)Yn + (R62 - O%)Yo + (R62 - P%)Yp }, if R62=> r62 and
R62=>P%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq )Ym/
{ (R62 - L%)Yl + (R62 - M%)Ym +
(R62 - N%)Yn + (R62 - O%)Yo}, if R62=> r62 and
P%=>R62=>O%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq )Ym/
{ (R62 - L%)Yl + (R62 - M%)Ym + (R62 - N%)Yn }, if R62=> r62 and
O%>R62=>N%;
(R62- r62)( Yl + Ym + Yn + Yo +Yp + Yq )Ym/
{ (R62 - L%)Yl + (R62 - M%)Ym }, if R62=> r62 and
N%>R62=>M%;
0, if R62=> r62 and R62<M%.
δ6Yn = 0, if R62> r62 and
R62=>N%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq )Yn/
{ (R62 - N%)Yn + (R62 - O%)Yo +
(R62 - P%)Yp + (R62 - Q%)Yq }, if R62> r62 and
M%<=R62<N%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq )Yn/
{ (R62 - M%)Ym + (R62 - N%)Yn + (R62 - O%)Yo +
(R62 - P%)Yp + (R62 - Q%)Yq }, if R62> r62 and
L%<=R62<M%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq )Yn/
{ (R62 - L%)Yl + (R62 - M%)Ym +
(R62 - N%)Yn + (R62 - O%)Yo + (R62 - P%)Yp }, if R62=> r62 and
R62=>P%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq )Yn/
{ (R62 - L%)Yl + (R62 - M%)Ym +
(R62 - N%)Yn + (R62 - O%)Yo }, if R62=> r62 and
P%>R62=>O%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq )Yn/
{ (R62 - L%)Yl + (R62 - M%)Ym + (R62 - N%)Yn }, if R62=> r62 and
O%>R62=>N%;
0, if R62=> r62 and R62<N%.
δ6Yo = 0, if R62> r62 and
R62=>O%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq )Yo/
{ (R62 - O%)Yo + (R62 - P%)Yp + (R62 - Q%)Yq }, if R62> r62 and
N%<=R62<O%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq )Yo/
{ (R62 - N%)Yn + (R62 - O%)Yo + (R62 - P%)Yp +
(R62 - Q%)Yq }, if R62> r62 and
M%<=R62<N%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq )Yo/
{ (R62 - M%)Ym + (R62 - N%)Yn + (R62 - O%)Yo +
(R62 - P%)Yp + (R62 - Q%)Yq }, if R62> r62 and
L%<=R62<M%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq )Yo/
{ (R62 - L%)Yl + (R62 - M%)Ym +
(R62 - N%)Yn + (R62 - O%)Yo + (R62 - P%)Yp }, if R62=> r62 and
R62=>P%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq )Yo/
{ (R62 - L%)Yl + (R62 - M%)Ym +
(R62 - N%)Yn + (R62 - O%)Yo}, if R62=> r62 and
P%>R62=>O%;
0, if R62=> r62 and R62<O%.
δ6Yp = 0, if R62> r62 and
R62=>P%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq)Yp/
{ (R62 - P%)Yp + (R62 - Q%)Yq }, if R62> r62 and
O%<=R62<P%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq)Yp/
{ (R62 - O%)Yo + (R62 - P%)Yp + (R62 - Q%)Yq }, if R62> r62 and
N%<=R62<O%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq)Yp/
{ (R62 - N%)Yn + (R62 - O%)Yo + (R62 - P%)Yp +
(R62 - Q%)Yq }, if R62> r62 and
M%<=R62<N%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq)Yp/
{ (R62 - M%)Ym + (R62 - N%)Yn +
(R62 - O%)Yo + (R62 - P%)Yp + (R62 - Q%)Yq }, if R62> r62 and
L%<=R62<M%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq )Yp/
{ (R62 - L%)Yl + (R62 - M%)Ym +
(R62 - N%)Yn + (R62 - O%)Yo + (R62 - P%)Yp }, if R62=> r62 and
R62=>P%;
0, if R62=> r62 and R62<P%.
δ6Yq = (R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq)/(R62 - Q%), if
R62> r62 and P%<=R62;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq)Yq/
{ (R62 - P%)Yp + (R62 - Q%)Yq }, if R62> r62 and
O%<=R62<P%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq)Yq/
{ (R62 - O%)Yo + (R62 - P%)Yp + (R62 - Q%)Yq }, if R62> r62 and
N%<=R62<O%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq)Yq/
{ (R62 - N%)Yn + (R62 - O%)Yo + (R62 - P%)Yp +
(R62 - Q%)Yq }, if R62> r62 and
M%<=R62<N%;
(R62- r62)( Yl + Ym + Yn + Yo + Yp + Yq)Yq/
{ (R62 - M%)Ym + (R62 - N%)Yn +
(R62 - O%)Yo + (R62 - P%)Yp + (R62 - Q%)Yq }, if R62> r62 and
L%<=R62<M%;
0, if R62=> r62.
δ6Yj, δ6Yk, δ6Yl, δ6Ym, δ6Yn, δ6Yo, δ6Yp and
δ6Yq are numbers respectively between Yj, Yk, Yl, Ym, Yn, Yo, Yp and Yq and 0
such that:
{J%(Yj - δ6Yj ) + K%( Yk.- δ6Yk) }/
( Yj - δ6Yj + Yk.- δ6Yk)
= R61;
and
{ L%( Yl.- δ6Yl) + M%( Ym.- δ6Ym) + N%( Yn.- δ6Yn +
O%( Yo.- δ6Yo) + P%( Yp.- δ6Yp) + Q%(Yq - δ6Yq ) }/
(Yl.- δ6Yl + Ym.- δ6Ym + Yn.- δ6Yn + Yo.- δ6Yo
+ Yp.- δ6Yp + Yq - δ6Yq)
= R62.
Y61 = Yj - δ6Yj + Yk.- δ6Yk.
P61 = Pj + Pk.
Z61 = Zj + Zk.
ΔY61 = ΔYj - δ6Yj + ΔYk.- δ6Yk.
ΔP61 = ΔPj + ΔPk.
ΔZ61 = ΔZj + ΔZk.
Y62 = Yl.- δ6Yl + Ym.- δ6Ym + Yn.- δ6Yn + Yo.- δ6Yo + Yp.-
δ6Yp + Yq - δ6Yq.
P62 = Pl + Pm + Pn + Po + Pp + Pq.
Z62 = Zl + Zm + Zn + Zo + Zp + Zq.
ΔY62 = ΔYl.- δ6Yl + ΔYm.- δ6Ym + ΔYn.- δ6Yn +
ΔYo.- δ6Yo + ΔYp.- δ6Yp + ΔYq.- δ6Yq
ΔP62 = ΔPl + ΔPm + ΔPn + ΔPo + ΔPp + ΔPq.
ΔZ62 = ΔZl + ΔZm + ΔZn + ΔZo + ΔZp + ΔZq.
1. If Y62 - α(P62 - ΔP62) => 0, Y61- α(P61 - ΔP61) => 0, and
γ6(P61 - ΔP61) < (P62 - ΔP62), then
ΔY62 = Y62 - αγ6(P61 - ΔP61) and
ΔY61 = Y61 - α(P61 - ΔP61).
2. If Y62 - α(P62 - ΔP62) => 0, Y61 - α(P61 - ΔP61) => 0, and
γ6(P61 - ΔP61) => (P62 - ΔP62), then
ΔY62 = Y62 - α(P62 - ΔP62) and
ΔY61 = Y61 - (α/γ6)(P62 - ΔP62).
3. If Y62 - α(P62 - ΔP62) < 0, Y61 - α(P61 - ΔP61) => 0, and
Y61 - α(P61 - ΔP61) => Y61 - (Y62/γ6), then
ΔY62 = Y62 - αγ6(P61 - ΔP61) and
ΔY61 = Y61 - α(P61 - ΔP61).
4. If Y62 - α(P62 - ΔP62) < 0, Y61 - (Y62/γ6) => 0, and
Y61 - α(P61 - ΔP61) <= Y61 - (Y62/γ6), then ΔY62 = 0 and
ΔY61 = Y61 - (Y62/γ6).
5. If Y61 - α(P61 - ΔP61) < 0, Y61 - (Y62/γ6) < 0, and
Y62 - α(P62 - ΔP62) <= Y62 - (γ6Y61), then
ΔY62 = Y62 - (γ6Y61) and ΔY61 = 0.
6. If Y61 - α(P61 - ΔP61) < 0, Y62 - α(P62 - ΔP62) => 0, and
Y62 - α(P62 - ΔP62) => Y62 - (γ6Y61), then
ΔY62 = Y62 - α(P62 - ΔP62) and
ΔY61 = Y61 - (α/γ6)(P62 - ΔP62).
ΔYj = δ6Yj + [(Yj - δ6Yj )/Y61 ]ΔY61
ΔYk = δ6Yk + [(Yk - δ6Yk )/Y61 ]ΔY61
ΔYl = δ6Yl + [(Yl - δ6Yl )/Y62 ]ΔY62
ΔYm = δ6Ym + [(Ym - δ6Ym )/Y62 ]ΔY62
ΔYn = δ6Yn + [(Yn - δ6Yn )/Y62 ]ΔY62
ΔYo = δ6Yo + [(Yo - δ6Yo )/Y62 ]ΔY62
ΔYp = δ6Yp + [(Yp - δ6Yp )/Y62 ]ΔY62
ΔYq = δ6Yq + [(Yq - δ6Yq )/Y62 ]ΔY62
The purpose of the foregoing definitional provisions together with the related provisions
allocating Realized Losses and defining the Class Y and Class Z Principal Distribution
Amounts is to accomplish the following goals in the following order of priority:
1. Making the ratio of (Y62 - ΔY62 ) to (Y61 - ΔY61 ) equal to γ6 after
taking account of the allocation Realized Losses and the distributions that will be
made through the end of the Distribution Date to which such provisions relate and
assuring that the Principal Reduction Amount for each of the Class YAA, Class YBB,
Class YCC, Class YDD, Class XXX, Class YFF, Class YGG, Class YHH, Class ZAA, Class
ZBB, Class ZCC, Class ZDD, Class ZEE, Class ZFF, Class ZGG and Class ZHH Certificates
is greater than or equal to zero for such Distribution Date;
2. Making the Class YAA Principal Balance less than or equal to 0.0005 of the sum of the
Class YAA and Class ZAA Principal Balances, the Class YBB Principal Balance less than
or equal to 0.0005 of the sum of the Class YBB and Class ZBB Principal Balances, the
Class YCC Principal Balance less than or equal to 0.0005 of the sum of the Class YCC
and Class ZCC Principal Balances, the Class YDD Principal Balance less than or equal
to 0.0005 of the sum of the Class YDD and Class ZDD Principal Balances, the Class XXX
Principal Balance less than or equal to 0.0005 of the sum of the Class XXX and Class
ZEE Principal Balances, the Class YFF Principal Balance less than or equal to 0.0005
of the sum of the Class YFF and Class ZFF Principal Balances, the Class YGG Principal
Balance less than or equal to 0.0005 of the sum of the Class YGG and Class ZGG
Principal Balances and the Class YHH Principal Balance less than or equal to 0.0005
of the sum of the Class YHH and Class ZHH Principal Balances in each case after
giving effect to allocations of Realized Losses and distributions to be made through
the end of the Distribution Date to which such provisions relate; and
3. Making the larger of (a) the fraction whose numerator is (Y62 - ΔY62 ) and whose
denominator is the sum of (Y62 - ΔY62) and (Z62 - ΔZ62) and (b) the
fraction whose numerator is (Y61 - ΔY61) and whose denominator is the sum of
(Y61 - ΔY61) and (Z61 - ΔZ61) as large as possible while remaining less
than or equal to 0.0005.
In the event of a failure of the foregoing portion of the definition of ClassY Principal
Reduction Amount to accomplish both of goals 1 and 2 above, the amounts thereof should be
adjusted to so as to accomplish such goals within the requirement that each REMIC I Y
Principal Reduction Amount must be less than or equal to the sum of (a) the Principal
Realized Losses to be allocated on the related Distribution Date for the related Pool
remaining after the allocation of such Realized Losses to the related class of ratio-strip
principal only certificates, if any, and (b) the remainder of the Available Distribution
Amount for the related Pool or after reduction thereof by the distributions to be made on
such Distribution Date (i) to the related class of ratio-strip principal only certificates,
if any, (ii) to the related class of ratio-strip interest only certificates, if any, and
(iii) in respect of interest on the related Class Y and Class Z Certificates, or, if both of
such goals cannot be accomplished within such requirement, such adjustment as is necessary
shall be made to accomplish goal 1 within such requirement. In the event of any conflict
among the provisions of the definition of the REMIC I Y Principal Reduction Amounts, such
conflict shall be resolved on the basis of the goals and their priorities set forth above
within the requirement set forth in the preceding sentence. If the formula allocations of
ΔY61 among ΔYj and ΔYk or ΔY62 among ΔYl, ΔYm, ΔYn,
ΔYo, ΔYp and ΔYq cannot be achieved because one or more of ΔYj, ΔYk,
ΔYl, ΔYm, ΔYn, ΔYo, ΔYp and ΔYq, as so defined is greater than
the related one of ΔPj, ΔPk, ΔPl, ΔPm, ΔPn, ΔPo, ΔPp and
ΔPq, such an allocation shall be made as close as possible to the formula allocation
within the requirement that ΔYj < ΔPj, ΔYk < ΔPk, ΔYl < ΔPl,
ΔYm < ΔPm, ΔYn < ΔPn, ΔYo < ΔPo, ΔYp < ΔPp and
ΔYq < ΔPq.
VII. If R<=K%, make the following additional definitions:
δ7Yk = 0, if R72> r72;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yk/
{ (R72 - K%)Yk + (R72 - L%)Yl + (R72 - M%)Ym +
(R72 - N%)Yn + (R72 - O%)Yo + (R72 - P%)Yp }, if R72=> r72 and
R72=>P%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yk/
{ (R72 - K%)Yk + (R72 - L%)Yl + (R72 - M%)Ym +
(R72 - N%)Yn + (R72 - O%)Yo }, if R72=> r72 and
P%>R72=>O%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yk/
{ (R72 - K%)Yk + (R72 - L%)Yl +
(R72 - M%)Ym + (R72 - N%)Yn }, if R72=> r72 and
O%>R72=>N%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo +Yp + Yq )Yk/
{ (R72 - K%)Yk + (R72 - L%)Yl + (R72 - M%)Ym }, if R72=> r72 and
N%>R72=>M%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yk/
{ (R72 - K%)Yk + (R72 - L%)Yl }, if R72=> r72 and
M%>R72=>L%; and
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )/(R72 - K%), if R72=> r72
and L%>R72=>K%.
δ7Yl = 0, if R72> r72 and
R72=>L%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yl/
{ (R72 - L%)Yl + (R72 - M%)Ym +
(R72 - N%)Yn + (R72 - O%)Yo +
(R72 - P%)Yp + (R72 - Q%)Yq }, if R72> r72 and
L%>R72=>K%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yl/
{ (R72 - K%)Yk + (R72 - L%)Yl + (R72 - M%)Ym +
(R72 - N%)Yn + (R72 - O%)Yo + (R72 - P%)Yp }, if R72=> r72 and
R72=>P%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yl/
{ (R72 - K%)Yk + (R72 - L%)Yl + (R72 - M%)Ym +
(R72 - N%)Yn + (R72 - O%)Yo}, if R72=> r72 and
P%>R72=>O%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yl/
{ (R72 - K%)Yk + (R72 - L%)Yl +
(R72 - M%)Ym + (R72 - N%)Yn }, if R72=> r72 and
O%>R72=>N%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo +Yp + Yq )Yl/
{ (R72 - K%)Yk + (R72 - L%)Yl + (R72 - M%)Ym }, if R72=> r72 and
N%>R72=>M%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yl/
{ (R72 - K%)Yk + (R72 - L%)Yl }, if R72=> r72 and
M%>R72=>L%;
0, if R72=> r72 and R72<L%.
δ7Ym = 0, if R72> r72 and
R72=>M%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Ym/
{ (R72 - M%)Ym + (R72 - N%)Yn + (R72 - O%)Yo +
(R72 - P%)Yp + (R72 - Q%)Yq }, if R72> r72 and
L%<=R72<M%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Ym/
{ (R72 - L%)Yl + (R72 - M%)Ym + (R72 - N%)Yn +
(R72 - O%)Yo + (R72 - P%)Yp + (R72 - Q%)Yq }, if R72> r72 and
K<=R72<L%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Ym/
{ (R72 - K%)Yk + (R72 - L%)Yl + (R72 - M%)Ym +
(R72 - N%)Yn + (R72 - O%)Yo + (R72 - P%)Yp }, if R72=> r72 and
R72=>P%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Ym/
{ (R72 - K%)Yk + (R72 - L%)Yl + (R72 - M%)Ym +
(R72 - N%)Yn + (R72 - O%)Yo}, if R72=> r72 and
P%=>R72=>O%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Ym/
{ (R72 - K%)Yk + (R72 - L%)Yl +
(R72 - M%)Ym + (R72 - N%)Yn }, if R72=> r72 and
O%>R72=>N%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo +Yp + Yq )Ym/
{ (R72 - K%)Yk + (R72 - L%)Yl + (R72 - M%)Ym }, if R72=> r72 and
N%>R72=>M%;
0, if R72=> r72 and R72<M%.
δ7Yn = 0, if R72> r72 and
R72=>N%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yn/
{ (R72 - N%)Yn + (R72 - O%)Yo +
(R72 - P%)Yp + (R72 - Q%)Yq }, if R72> r72 and
M%<=R72<N%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yn/
{ (R72 - M%)Ym + (R72 - N%)Yn + (R72 - O%)Yo +
(R72 - P%)Yp + (R72 - Q%)Yq }, if R72> r72 and
L%<=R72<M%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yn/
{ (R72 - L%)Yl + (R72 - M%)Ym + (R72 - N%)Yn +
(R72 - O%)Yo + (R72 - P%)Yp + (R72 - Q%)Yq }, if R72> r72 and
K%<=R72<L%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yn/
{ (R72 - K%)Yk + (R72 - L%)Yl + (R72 - M%)Ym +
(R72 - N%)Yn + (R72 - O%)Yo + (R72 - P%)Yp }, if R72=> r72 and
R72=>P%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yn/
{ (R72 - K%)Yk + (R72 - L%)Yl +
(R72 - M%)Ym + (R72 - N%)Yn + (R72 - O%)Yo }, if R72=> r72 and
P%>R72=>O%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yn/
{ (R72 - K%)Yk + (R72 - L%)Yl +
(R72 - M%)Ym + (R72 - N%)Yn }, if R72=> r72 and
O%>R72=>N%;
0, if R72=> r72 and R72<N%.
δ7Yo = 0, if R72> r72 and
R72=>O%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yo/
{ (R72 - O%)Yo + (R72 - P%)Yp + (R72 - Q%)Yq }, if R72> r72 and
N%<=R72<O%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yo/
{ (R72 - N%)Yn + (R72 - O%)Yo + (R72 - P%)Yp +
(R72 - Q%)Yq }, if R72> r72 and
M%<=R72<N%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yo/
{ (R72 - M%)Ym + (R72 - N%)Yn + (R72 - O%)Yo +
(R72 - P%)Yp + (R72 - Q%)Yq }, if R72> r72 and
L%<=R72<M%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yo/
{ (R72 - L%)Yl + (R72 - M%)Ym + (R72 - N%)Yn +
(R72 - O%)Yo + (R72 - P%)Yp + (R72 - Q%)Yq }, if R72> r72 and
K%<=R72<L%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yo/
{ (R72 - K%)Yk + (R72 - L%)Yl + (R72 - M%)Ym +
(R72 - N%)Yn + (R72 - O%)Yo + (R72 - P%)Yp }, if R72=> r72 and
R72=>P%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yo/
{ (R72 - K%)Yk + (R72 - L%)Yl + (R72 - M%)Ym +
(R72 - N%)Yn + (R72 - O%)Yo}, if R72=> r72 and
P%>R72=>O%;
0, if R72=> r72 and R72<O%.
δ7Yp = 0, if R72> r72 and
R72=>P%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq)Yp/
{ (R72 - P%)Yp + (R72 - Q%)Yq }, if R72> r72 and
O%<=R72<P%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq)Yp/
{ (R72 - O%)Yo + (R72 - P%)Yp + (R72 - Q%)Yq }, if R72> r72 and
N%<=R72<O%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq)Yp/
{ (R72 - N%)Yn + (R72 - O%)Yo + (R72 - P%)Yp +
(R72 - Q%)Yq }, if R72> r72 and
M%<=R72<N%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq)Yp/
{ (R72 - M%)Ym + (R72 - N%)Yn +
(R72 - O%)Yo + (R72 - P%)Yp + (R72 - Q%)Yq }, if R72> r72 and
L%<=R72<M%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq)Yp/
{ (R72 - L%)Yl + (R72 - M%)Ym + (R72 - N%)Yn +
(R72 - O%)Yo + (R72 - P%)Yp + (R72 - Q%)Yq }, if R72> r72 and
K%<=R72<L%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq )Yp/
{ (R72 - K%)Yk + (R72 - L%)Yl + (R72 - M%)Ym +
(R72 - N%)Yn + (R72 - O%)Yo + (R72 - P%)Yp }, if R72=> r72 and
R72=>P%;
0, if R72=> r72 and R72<P%.
δ7Yq = (R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq)/(R72 - Q%), if R72> r72
and P%<=R72;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq)Yq/
{ (R72 - P%)Yp + (R72 - Q%)Yq }, if R72> r72 and
O%<=R72<P%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq)Yq/
{ (R72 - O%)Yo + (R72 - P%)Yp + (R72 - Q%)Yq }, if R72> r72 and
N%<=R72<O%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq)Yq/
{ (R72 - N%)Yn + (R72 - O%)Yo + (R72 - P%)Yp +
(R72 - Q%)Yq }, if R72> r72 and
M%<=R72<N%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq)Yq/
{ (R72 - M%)Ym + (R72 - N%)Yn +
(R72 - O%)Yo + (R72 - P%)Yp + (R72 - Q%)Yq }, if R72> r72 and
L%<=R72<M%;
(R72- r72)( Yk + Yl + Ym + Yn + Yo + Yp + Yq)Yq/
{ (R72 - L%)Yl + (R72 - M%)Ym + (R72 - N%)Yn +
(R72 - O%)Yo + (R72 - P%)Yp + (R72 - Q%)Yq }, if R72> r72 and
K%<=R72<L%;
0, if R72=> r72.
δ7Yk, δ7Yl, δ7Ym, δ7Yn, δ7Yo, δ7Yp and δ7Yq are
numbers respectively between Yk, Yl, Ym, Yn, Yo, Yp and Yq and 0 such that
{ K%( Yk.- δ7Yk) + L%( Yl.- δ7Yl) + M%( Ym.- δ7Ym) +
N%( Yn.- δ7Yn) + O%( Yo.- δ7Yo) + P%( Yp.- δ7Yp) + Q%(Yq -
δ7Yq ) }/
( Yk.- δ7Yk + Yl.- δ7Yl + Ym.- δ7Ym + Yn.- δ7Yn
+ Yo.- δ7Yo + Yp.- δ7Yp + Yq - δ7Yq)
= R72.
Y72 = Yk.- δ7Yk + Yl.- δ7Yl + Ym.- δ7Ym + Yn.- δ7Yn + Yo.-
δ7Yo + Yp.- δ7Yp + Yq - δ7Yq
P72 = Pk + Pl + Pm + Pn + Po + Pp + Pq.
Z72 = Zk + Zl + Zm + Zn + Zo + Zp + Zq.
ΔY72 = ΔYk.- δ7Yk + ΔYl.- δ7Yl + ΔYm.- δ7Ym +
ΔYn.- δ7Yn + ΔYo.- δ7Yo + ΔYp.- δ7Yp + ΔYq.-
δ7Yq
ΔP72 = ΔPk + ΔPl + ΔPm + ΔPn + ΔPo + ΔPp + ΔPq.
ΔZ72 = ΔZk + ΔZl + ΔZm + ΔZn + ΔZo + ΔZp + ΔZq.
1. If Y72 - α(P72 - ΔP72) => 0, Yj- α(Pj - ΔPj) => 0, and
γ7(Pj - ΔPj) < (P72 - ΔP72), then
ΔY72 = Y72 - αγ7(Pj - ΔPj) and
ΔYj = Yj - α(Pj - ΔPj).
2. If Y72 - α(P72 - ΔP72) => 0, Yj - α(Pj - ΔPj) => 0, and
γ7(Pj - ΔPj) => (P72 - ΔP72), then
ΔY72 = Y72 - α(P72 - ΔP72) and
ΔYj = Yj - (α/γ7)(P72 - ΔP72).
3. If Y72 - α(P72 - ΔP72) < 0, Yj - α(Pj - ΔPj) => 0, and
Yj - α(Pj - ΔPj) => Yj - (Y72/γ7), then
ΔY72 = Y72 - αγ7(Pj - ΔPj) and
ΔYj = Yj - α(Pj - ΔPj).
4. If Y72 - α(P72 - ΔP72) < 0, Yj - (Y72/γ7) => 0, and
Yj - α(Pj - ΔPj) <= Yj - (Y72/γ7), then ΔY72 = 0 and
ΔYj = Yj - (Y72/γ7).
5. If Yj - α(Pj - ΔPj) < 0, Yj - (Y72/γ7) < 0, and
Y72 - α(P72 - ΔP72) <= Y72 - (γ7Yj), then
ΔY72 = Y72 - (γ7Yj) and ΔYj = 0.
6. If Yj - α(Pj - ΔPj) < 0, Y72 - α(P72 - ΔP72) => 0, and
Y72 - α(P72 - ΔP72) => Y72 - (γ7Yj), then
ΔY72 = Y72 - α(P72 - ΔP72) and
ΔYj = Yj - (α/γ7)(P72 - ΔP72).
ΔYk = δ7Yk + [(Yk - δ7Yk )/Y72 ]ΔY72
ΔYl = δ7Yl + [(Yl - δ7Yl )/Y72 ]ΔY72
ΔYm = δ7Ym + [(Ym - δ7Ym )/Y72 ]ΔY72
ΔYn = δ7Yn + [(Yn - δ7Yn )/Y72 ]ΔY72
ΔYo = δ7Yo + [(Yo - δ7Yo )/Y72 ]ΔY72
ΔYp = δ7Yp + [(Yp - δ7Yp )/Y72 ]ΔY72
ΔYq = δ7Yq + [(Yq - δ7Yq )/Y72 ]ΔY72
The purpose of the foregoing definitional provisions together with the related provisions
allocating Realized Losses and defining the Class Y and Class Z Principal Distribution
Amounts is to accomplish the following goals in the following order of priority:
1. Making the ratio of (Y72 - ΔY72 ) to (Yj - ΔYj ) equal to γ7 after
taking account of the allocation Realized Losses and the distributions that will be
made through the end of the Distribution Date to which such provisions relate and
assuring that the Principal Reduction Amount for each of the Class YAA, Class YBB,
Class YCC, Class YDD, Class XXX, Class YFF, Class YGG, Class YHH, Class ZAA, Class
ZBB, Class ZCC, Class ZDD, Class ZEE, Class ZFF, Class ZGG and Class ZHH Certificates
is greater than or equal to zero for such Distribution Date;
2. Making the Class YAA Principal Balance less than or equal to 0.0005 of the sum of the
Class YAA and Class ZAA Principal Balances, the Class YBB Principal Balance less than
or equal to 0.0005 of the sum of the Class YBB and Class ZBB Principal Balances, the
Class YCC Principal Balance less than or equal to 0.0005 of the sum of the Class YCC
and Class ZCC Principal Balances, the Class YDD Principal Balance less than or equal
to 0.0005 of the sum of the Class YDD and Class ZDD Principal Balances, the Class XXX
Principal Balance less than or equal to 0.0005 of the sum of the Class XXX and Class
ZEE Principal Balances, the Class YFF Principal Balance less than or equal to 0.0005
of the sum of the Class YFF and Class ZFF Principal Balances, the Class YGG Principal
Balance less than or equal to 0.0005 of the sum of the Class YGG and Class ZGG
Principal Balances and the Class YHH Principal Balance less than or equal to 0.0005
of the sum of the Class YHH and Class ZHH Principal Balances in each case after
giving effect to allocations of Realized Losses and distributions to be made through
the end of the Distribution Date to which such provisions relate; and
3. Making the larger of (a) the fraction whose numerator is (Y72 - ΔY72 ) and whose
denominator is the sum of (Y72 - ΔY72) and (Z72 - ΔZ72) and (b) the
fraction whose numerator is (Yj - ΔYj) and whose denominator is the sum of (Yj -
ΔYj) and (Zj - ΔZj) as large as possible while remaining less than or equal
to 0.0005.
In the event of a failure of the foregoing portion of the definition of ClassY Principal
Reduction Amount to accomplish both of goals 1 and 2 above, the amounts thereof should be
adjusted to so as to accomplish such goals within the requirement that each REMIC I Y
Principal Reduction Amount must be less than or equal to the sum of (a) the Principal
Realized Losses to be allocated on the related Distribution Date for the related Pool
remaining after the allocation of such Realized Losses to the related class of ratio-strip
principal only certificates, if any, and (b) the remainder of the Available Distribution
Amount for the related Pool or after reduction thereof by the distributions to be made on
such Distribution Date (i) to the related class of ratio-strip principal only certificates,
if any, (ii) to the related class of ratio-strip interest only certificates, if any, and
(iii) in respect of interest on the related Class Y and Class Z Certificates, or, if both of
such goals cannot be accomplished within such requirement, such adjustment as is necessary
shall be made to accomplish goal 1 within such requirement. In the event of any conflict
among the provisions of the definition of the REMIC I Y Principal Reduction Amounts, such
conflict shall be resolved on the basis of the goals and their priorities set forth above
within the requirement set forth in the preceding sentence. If the formula allocation of
ΔY72 among ΔYk, ΔYl, ΔYm, ΔYn, ΔYo, ΔYp and ΔYq
cannot be achieved because one or more of ΔYk, ΔYl, ΔYm, ΔYn, ΔYo,
ΔYp and ΔYq, as so defined is greater than the related one of ΔPk, ΔPl,
ΔPm, ΔPn, ΔPo, ΔPp and ΔPq, such an allocation shall be made as
close as possible to the formula allocation within the requirement that ΔYk < ΔPk,
ΔYl < ΔPl, ΔYm < ΔPm, ΔYn < ΔPn, ΔYo < ΔPo, ΔYp
> ΔPp and ΔYq < ΔPq.
[Method of calculating initial balance of the Class Y and Class Z interest to come]
NOTES:
1. Classes YAA and ZAA are related to the Group AA loans. The sum of the Class
Principal Balances for the Class YAA and Class ZAA Certificates is equal to the aggregate
stated principal balance of the Group AA Loans [minus the Class Principal Balance of the
Class AA-P Certificates]. Classes YCC and ZCC are related to the Group CC loans. The sum
of the Class Principal Balances for the Class YCC and Class ZCC Certificates is equal to the
aggregate stated principal balance of the Group CC Loans [minus the Class Principal Balance
of the Class CC-P Certificates]. Classes YBB and ZBB are related to the Group BB loans.
The sum of the Class Principal Balances for the Class YBB and Class ZBB Certificates is
equal to the aggregate stated principal balance of the Group BB Loans [minus the Class
Principal Balance of the Class BB-P Certificates]. The Y and Z classes will be principal
and interest classes bearing interest at the pass-through rate for the related loan group.
2. The Class CB pass-through rate is the weighted average of the pass-through rates on
the Class YAA, Class YCC and Class YBB Certificates.
