EXHIBIT 4.1
BANC OF AMERICA MORTGAGE SECURITIES, INC.,
as Depositor,
BANK OF AMERICA, NATIONAL ASSOCIATION,
as Servicer,
and
XXXXX FARGO BANK, N.A.,
as Trustee
POOLING AND SERVICING AGREEMENT
Dated September 28, 2006
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Banc of America Alternative Loan Trust 2006-7
Mortgage Pass-Through Certificates
Series 2006-7
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms............................................
Section 1.02 Interest Calculations....................................
Section 1.03 Fiscal Year..............................................
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01 Conveyance of Mortgage Loans.............................
Section 2.02 Acceptance by the Trustee of the Mortgage Loans..........
Section 2.03 Representations and Warranties of the Servicer...........
Section 2.04 Representations and Warranties of the Depositor as to the
Mortgage Loans..........................................
Section 2.05 Designation of Interests in the REMICs...................
Section 2.06 Designation of Start-up Day..............................
Section 2.07 REMIC Certificate Maturity Date..........................
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
Section 3.01 Servicer to Service Mortgage Loans.......................
Section 3.02 Subservicing; Enforcement of the Obligations of Servicer.
Section 3.03 Fidelity Bond; Errors and Omissions Insurance............
Section 3.04 Access to Certain Documentation..........................
Section 3.05 Maintenance of Primary Insurance Policy; Claims;
Collections of BPP Mortgage Loan Payments...............
Section 3.06 Rights of the Depositor and the Trustee in Respect of the
Servicer................................................
Section 3.07 Trustee to Act as Servicer...............................
Section 3.08 Collection of Mortgage Loan Payments; Servicer Custodial
Account; Certificate Account;...........................
Section 3.09 Collection of Taxes, Assessments and Similar Items;
Escrow Accounts.........................................
Section 3.10 Access to Certain Documentation and Information Regarding
the Mortgage Loans......................................
Section 3.11 Permitted Withdrawals from the Servicer Custodial Account
and Certificate Account.................................
Section 3.12 Maintenance of Hazard Insurance..........................
Section 3.13 Enforcement of Due-On-Sale Clauses; Assumption Agreements
Section 3.14 Realization Upon Defaulted Mortgage Loans; REO Property..
Section 3.15 Trustee to Cooperate; Release of Mortgage Files..........
Section 3.16 Documents, Records and Funds in Possession of the
Servicer to Be Held for the Trustee.....................
Section 3.17 Servicing Compensation...................................
Section 3.18 Annual Statement as to Compliance........................
Section 3.19 Assessments of Servicing Compliance; Registered Public
Accounting Firm Attestation Reports.....................
Section 3.20 Advances.................................................
Section 3.21 Modifications, Waivers, Amendments and Consents..........
Section 3.22 Reports to the Securities and Exchange Commission........
ARTICLE IV
SERVICER'S CERTIFICATE
Section 4.01 Servicer's Certificate...................................
ARTICLE V
PAYMENTS AND STATEMENTS TO CERTIFICATEHOLDERS;
REMIC ADMINISTRATION
Section 5.01 Distributions............................................
Section 5.02 Priorities of Distributions..............................
Section 5.03 Allocation of Losses.....................................
Section 5.04 Statements to Certificateholders.........................
Section 5.05 Tax Returns and Reports to Certificateholders............
Section 5.06 Tax Matters Person.......................................
Section 5.07 Rights of the Tax Matters Person in Respect of the
Trustee.................................................
Section 5.08 REMIC Related Covenants..................................
Section 5.09 Grantor Trust Administration.............................
Section 5.10 Cap Carryover Reserve Account............................
Section 5.11 REMIC Distributions......................................
ARTICLE VI
THE CERTIFICATES
Section 6.01 The Certificates.........................................
Section 6.02 Registration of Transfer and Exchange of Certificates....
Section 6.03 Mutilated, Destroyed, Lost or Stolen Certificates........
Section 6.04 Persons Deemed Owners....................................
ARTICLE VII
THE DEPOSITOR AND THE SERVICER
Section 7.01 Respective Liabilities of the Depositor and the Servicer..
Section 7.02 Merger or Consolidation of the Depositor or the Servicer..
Section 7.03 Limitation on Liability of the Depositor, the Servicer
and Others..............................................
Section 7.04 Depositor and Servicer Not to Resign.....................
Section 7.05 Assignment or Delegation of Duties by the Servicer.......
ARTICLE VIII
DEFAULT
Section 8.01 Events of Default........................................
Section 8.02 Remedies of Trustee......................................
Section 8.03 Directions by Certificateholders and Duties of Trustee
During Event of Default.................................
Section 8.04 Action upon Certain Failures of the Servicer and upon
Event of Default........................................
Section 8.05 Trustee to Act; Appointment of Successor.................
Section 8.06 Notification to Certificateholders.......................
ARTICLE IX
THE TRUSTEE
Section 9.01 Duties of Trustee........................................
Section 9.02 Certain Matters Affecting the Trustee....................
Section 9.03 Trustee Not Liable for Certificates or Mortgage Loans....
Section 9.04 Trustee May Own Certificates.............................
Section 9.05 Eligibility Requirements for Trustee.....................
Section 9.06 Resignation and Removal of Trustee.......................
Section 9.07 Successor Trustee........................................
Section 9.08 Merger or Consolidation of Trustee.......................
Section 9.09 Appointment of Co-Trustee or Separate Trustee............
Section 9.10 Authenticating Agents....................................
Section 9.11 Trustee's Fees and Expenses..............................
Section 9.12 Appointment of Custodian.................................
Section 9.13 Paying Agents............................................
Section 9.14 Limitation of Liability..................................
Section 9.15 Trustee May Enforce Claims Without Possession of
Certificates............................................
Section 9.16 Suits for Enforcement....................................
Section 9.17 Waiver of Bond Requirement...............................
Section 9.18 Waiver of Inventory, Accounting and Appraisal Requirement
ARTICLE X
TERMINATION
Section 10.01 Termination upon Purchase by the Call Right Holder or
Liquidation of All Mortgage Loans.......................
Section 10.02 Additional Termination Requirements......................
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01 Amendment................................................
Section 11.02 Recordation of Agreement.................................
Section 11.03 Limitation on Rights of Certificateholders...............
Section 11.04 Governing Law............................................
Section 11.05 Notices..................................................
Section 11.06 Severability of Provisions...............................
Section 11.07 Certificates Nonassessable and Fully Paid................
Section 11.08 Access to List of Certificateholders.....................
Section 11.09 Recharacterization.......................................
Section 11.10 Insolvency...............................................
Section 11.11 Regulation AB Compliance; Intent of Parties;
Reasonableness..........................................
EXHIBITS
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Exhibit A-A-1 - Form of Face of Class A-1 Certificate
Exhibit A-A-2 - Form of Face of Class A-2 Certificate
Exhibit A-A-3 - Form of Face of Class A-3 Certificate
Exhibit A-A-4 - Form of Face of Class A-4 Certificate
Exhibit A-A-5 - Form of Face of Class A-5 Certificate
Exhibit A-A-6 - Form of Face of Class A-6 Certificate
Exhibit B-1 - Form of Face of Class M-1 Certificate
Exhibit B-2 - Form of Face of Class M-2 Certificate
Exhibit B-3 - Form of Face of Class M-3 Certificate
Exhibit B-4 - Form of Face of Class M-4 Certificate
Exhibit B-5 - Form of Face of Class M-5 Certificate
Exhibit B-6 - Form of Face of Class CE Certificate
Exhibit B-7 - Form of Face of Class R Certificate
Exhibit C - Form of Reverse of all Certificates................
Exhibit D - Addresses for Requesting Mortgage Loan
Schedule .........................................
Exhibit E - Request for Release of Documents...................
Exhibit F - Form of Certification of Establishment of
Account...........................................
Exhibit G-1 - Form of Transferor's Certificate...................
Exhibit G-2A - Form 1 of Transferee's Certificate.................
Exhibit G-2B - Form 2 of Transferee's Certificate.................
Exhibit H - Form of Transferee Representation Letter for
ERISA Restricted Certificates.....................
Exhibit I - Form of Affidavit Regarding Transfer of
Residual Certificate..............................
Exhibit J - Contents of Servicing File.........................
Exhibit K - Form of Special Servicing Agreement................
Exhibit L - List of Recordation States.........................
Exhibit M - Form of Initial Certification of the Trustee.......
Exhibit N - Form of Final Certification of the Trustee.........
Exhibit O - Form of Xxxxxxxx-Xxxxx Certification...............
Exhibit P - Form of Trustee's Certification....................
Exhibit Q - Servicing Criteria.................................
Exhibit R-1 - Additional Form 10-D Information ..................
Exhibit R-2 - Additional Form 10-K Information ..................
Exhibit R-3 - Form 8-K Information ..............................
POOLING AND SERVICING AGREEMENT
THIS POOLING AND SERVICING AGREEMENT, dated September 28, 2006, is
hereby executed by and among BANC OF AMERICA MORTGAGE SECURITIES, INC., as
depositor (together with its permitted successors and assigns, the "Depositor"),
BANK OF AMERICA, NATIONAL ASSOCIATION, as servicer (together with its permitted
successors and assigns, the "Servicer"), and XXXXX FARGO BANK, N.A., as trustee
(together with its permitted successors and assigns, the "Trustee").
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 Servicer and the Trustee agree as follows:
PRELIMINARY STATEMENT
The Depositor intends to sell pass-through certificates
(collectively, the "Certificates"), to be issued hereunder in multiple Classes,
which in the aggregate will evidence the entire beneficial ownership interest in
the Trust created hereunder. The Certificates will consist of thirteen Classes
of Certificates, designated as (i) the Class A-1, Class A-2, Class A-3, Class
A-4, Class A-5 and Class A-6 Certificates, (ii) the Class M-1, Class M-2, Class
M-3, Class M-4 and Class M-5 Certificates, (iii) the Class CE Certificates and
(iv) the Class R Certificate. The portion of the Trust Estate consisting of the
Cap Carryover Reserve Account and the right of the Offered Certificates to
receive amounts from the Cap Carryover Reserve Account shall not be assets of
either REMIC created hereunder, but rather shall be assets of the Grantor Trust.
REMIC 1
As provided herein, the Trustee will make an election to treat the
segregated pool of assets consisting of the Mortgage Loans and certain other
related assets subject to this Agreement (but exclusive of the Cap Carryover
Amounts and the Cap Carryover Reserve Account) as a real estate investment
conduit (a "REMIC") for federal income tax purposes, and such segregated pool of
assets will be designated as "REMIC 1." The Class R-1 Interest will represent
the sole class of "residual interests" in REMIC 1 for purposes of the REMIC
Provisions under federal income tax law. The following table irrevocably sets
forth the designation, the Uncertificated REMIC 1 Pass-Through Rate, the initial
Uncertificated Principal Balance, and solely for purposes of satisfying Treasury
Regulations Section 1.860G-1(a)(4)(iii), the "latest possible maturity date" for
each of the REMIC 1 Regular Interests. None of the REMIC 1 Regular Interests
will be certificated.
Uncertificated Initial
REMIC 1 Uncertificated Latest Possible
Designation Pass-Through Rate Balance Maturity Date
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LT1AA Variable(2) $328,609,886.00 October 25, 2036
LT1A1 Variable(2) $1,258,220.00 October 25, 2036
LT1A2 Variable(2) $364,850.00 October 25, 2036
LT1A3 Variable(2) $488,370.00 October 25, 2036
LT1A4 Variable(2) $370,880.00 October 25, 2036
LT1A5 Variable(2) $121,075.00 October 25, 2036
LT1A6 Variable(2) $600,550.00 October 25, 2036
LT1M1 Variable(2) $65,385.00 October 25, 2036
LT1M2 Variable(2) $16,765.00 October 25, 2036
LT1M3 Variable(2) $16,765.00 October 25, 2036
LT1M4 Variable(2) $16,765.00 October 25, 2036
LT1M5 Variable(2) $16,765.00 October 25, 2036
LT1ZZ Variable(2) $3,369,934.00 October 25, 2036
LT1XX Variable(2) $335,316,211.00 October 25, 2036
(1) Solely for purposes of Treasury Regulations Section 1.860G-1(a)(4)(iii),
the Distribution Date in the month following the maturity date for the
Mortgage Loan with the latest maturity date has been designated as the
"latest possible maturity date" for each REMIC 1 Regular Interest.
(2) Calculated in accordance with the definition of "Uncertificated REMIC 1
Pass-Through Rate" herein.
REMIC 2
As provided herein, the Trustee shall make an election to treat the
segregated pool of assets consisting of the REMIC 1 Regular Interests as a REMIC
for federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC 2." The Class R-2 Interest represents the sole class of
"residual interests" in REMIC 2 for purposes of the REMIC Provisions.
The following table sets forth characteristics of the Certificates,
together with the minimum Denominations and integral multiples in excess thereof
in which the Classes of Certificates shall be issuable:
Integral
Initial Class Multiples in
Certificate Certificate Minimum Excess of
Classes Balance Interest Rate Denomination Minimum
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Class A-1 $251,644,000.00 (1) $1,000 $1
Class A-2 $72,970,000.00 (2) $1,000 $1
Class A-3 $97,674,000.00 (3) $1,000 $1
Class A-4 $74,176,000.00 (4) $1,000 $1
Class A-5 $24,215,000.00 (5) $1,000 $1
Class A-6 $120,110,000.00 (6) $1,000 $1
Class M-1 $13,077,000.00 (7) $25,000 $1
Class M-2 $3,353,000.00 (8) $25,000 $1
Class M-3 $3,353,000.00 (9) $25,000 $1
Class M-4 $3,353,000.00 (10) $25,000 $1
Class M-5 $3,353,000.00 (11) $25,000 $1
Class CE (12) (12) (13) N/A
Class R N/A N/A (14) N/A
Total $667,278,000.00
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(1) Interest will accrue on the Class A-1 Certificates during each Interest
Accrual Period at a rate equal to the lesser of: (i) the Class A-1
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
(2) Interest will accrue on the Class A-2 Certificates during each Interest
Accrual Period at a rate equal to the lesser of: (i) the Class A-2
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
(3) Interest will accrue on the Class A-3 Certificates during each Interest
Accrual Period at a rate equal to the lesser of: (i) the Class A-3
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
(4) Interest will accrue on the Class A-4 Certificates during each Interest
Accrual Period at a rate equal to the lesser of: (i) the Class A-4
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
(5) Interest will accrue on the Class A-5 Certificates during each Interest
Accrual Period at a rate equal to the lesser of: (i) the Class A-5
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
(6) Interest will accrue on the Class A-6 Certificates during each Interest
Accrual Period at a rate equal to the lesser of: (i) the Class A-6
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
(7) Interest will accrue on the Class M-1 Certificates during each Interest
Accrual Period at a rate equal to the lesser of: (i) the Class M-1
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
(8) Interest will accrue on the Class M-2 Certificates during each Interest
Accrual Period at a rate equal to the lesser of: (i) the Class M-2
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
(9) Interest will accrue on the Class M-3 Certificates during each Interest
Accrual Period at a rate equal to the lesser of: (i) the Class M-3
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
(10) Interest will accrue on the Class M-4 Certificates during each Interest
Accrual Period at a rate equal to the lesser of: (i) the Class M-4
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
(11) Interest will accrue on the Class M-5 Certificates during each Interest
Accrual Period at a rate equal to the lesser of: (i) the Class M-5
Pass-Through Rate and (ii) the Pool Cap for such Distribution Date.
(12) Solely for REMIC purposes, the Class CE Certificates will (i) have an
Initial Class Certificate Balance equal to the Initial
Overcollateralization Amount and (ii) will bear interest on its Notional
Amount at its Pass-Through Rate.
(13) The Class CE Certificates are issuable only in minimum Percentage
Interests of 10% and incremental Percentage Interests of 1% in excess
thereof.
(14) The Class R Certificate is issuable only as a single certificate.
ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms. Whenever used in this Agreement, the
following words and phrases, unless the context otherwise requires, shall have
the meanings specified in this Article:
10-K Filing Deadline: As defined in Section 3.22(c).
1933 Act: The Securities Act of 1933, as amended.
60+ Day Delinquent Loan: Each Mortgage Loan (including each Mortgage
Loan in foreclosure and each Mortgage Loan for which the Mortgagor has filed for
bankruptcy after the Closing Date) with respect to which any portion of a
Monthly Payment is, as of the last day of the prior Collection Period, two
months or more past due and each Mortgage Loan relating to an REO Property.
Accrued Certificate Interest: With respect to each Distribution Date
and Class of Certificates, an amount equal to the interest accrued at the
Certificate Interest Rate for such Class in the Preliminary Statement (or in the
case of the regular interests represented thereby, at the related REMIC 2
Pass-Through Rate) during the related Interest Accrual Period on the Class
Certificate Balance of such Class of Certificates, reduced by such Class'
Interest Percentage of Relief Act Reductions for such Distribution Date.
Additional Form 10-D Information: As defined in Section 3.22(b).
Additional Form 10-K Information: As defined in Section 3.22(c).
Additional Servicer: As defined in Section 3.02(e)
Advance: A Periodic Advance or a Servicing Advance.
Agreement: This Pooling and Servicing Agreement together with all
amendments hereof and supplements hereto.
Amount Held for Future Distribution: As to any Distribution Date,
the total of the amounts held in the Servicer Custodial Account at the close of
business on the preceding Determination Date on account of (i) Principal
Prepayments and Liquidation Proceeds received or made on the Mortgage Loans in
the month of such Distribution Date and (ii) payments which represent receipt of
Monthly Payments on the Mortgage Loans in respect of a Due Date or Due Dates
subsequent to the related Due Date.
Ancillary Income: All prepayment premiums (if any), assumption fees,
late payment charges and all other ancillary income and fees with respect to the
Mortgage Loans.
Applied Realized Loss Amount: With respect to each Distribution
Date, the excess, if any, of the aggregate of (a) the Class Certificate Balances
of the Certificates (after taking into account the distribution of the Principal
Distribution Amount on such Distribution Date and any increase in any Class
Certificate Balance as a result of Recoveries) over (b) the aggregate Stated
Principal Balance of the Mortgage Loans as of the end of the related Collection
Period after giving effect to Principal Prepayments received during the calendar
month preceding the month of that Distribution Date.
Appraised Value: With respect to any Mortgaged Property, either (i)
the lesser of (a) the appraised value determined in an appraisal obtained by the
originator at origination of such Mortgage Loan or an automated valuation model
or tax assessed value (if permitted by the applicable mortgage loan program) and
(b) the sales price for such property, except that, in the case of Mortgage
Loans the proceeds of which were used to refinance an existing mortgage loan,
the Appraised Value of the related Mortgaged Property is the appraised value
thereof determined either in an appraisal obtained at the time of refinancing or
an automated valuation model or tax assessed value (if permitted by the
applicable mortgage loan program), or (ii) the appraised value determined in an
appraisal made at the request of a Mortgagor subsequent to origination in order
to eliminate the Mortgagor's obligation to keep a Primary Insurance Policy in
force.
Assignment of Mortgage: An individual assignment of the Mortgage,
notice of transfer or equivalent instrument in recordable form, sufficient under
the laws of the jurisdiction wherein the related Mortgaged Property is located
to give record notice of the sale of the Mortgage.
Authenticating Agents: As defined in Section 9.10.
Bank of America: Bank of America, National Association, a national
banking association, or its successor in interest.
Book-Entry Certificate: Any Class of Certificates other than the
Physical Certificates.
BPP Mortgage Loan: Any Mortgage Loan which includes a Borrowers
Protection Plan(R) addendum to the related Mortgage Note whereby Bank of America
agrees to cancel (i) certain payments of principal and interest on such Mortgage
Loan for up to twelve months upon the disability or involuntary unemployment of
the Mortgagor or (ii) the outstanding principal balance of the Mortgage Loan
upon the accidental death of the Mortgagor; provided that such Borrowers
Protection Plan(R) has not been terminated in accordance with its terms.
BPP Mortgage Loan Payment: With respect to any BPP Mortgage Loan,
the Monthly Covered Amount or Total Covered Amount, if any, payable by Bank of
America pursuant to Section 5 of the Mortgage Loan Purchase Agreement.
Business Day: Any day other than (i) a Saturday or a Sunday or (ii)
a day on which banking institutions in the State of North Carolina, the State of
New York, the State of Minnesota, each state in which the servicing offices of
the Servicer are located or each state in which the Corporate Trust Office is
located are required or authorized by law or executive order to be closed.
Call Right Holder: The Majority Class CE Certificateholders, or if
such holder is the Seller, or an affiliate of the Seller, or if the Majority
Class CE Certificateholders fail to exercise the option on the Optional
Termination Date, the Depositor.
Cap Carryover Amount: If on any Distribution Date, the Accrued
Certificate Interest for any Certificate is based upon the Pool Cap, the excess
of (i) the amount of interest such Certificate would have been entitled to
receive on such Distribution Date based on the related Pass-Through Rate, over
(ii) the amount of interest such Certificate received on such Distribution Date
based on the Pool Cap, together with the unpaid portion of any such excess from
prior Distribution Dates (and interest accrued thereon at the then applicable
Pass-Through Rate on such Certificate).
Cap Carryover Reserve Account: The account or accounts created and
maintained pursuant to Section 5.10 hereof.
Certificate: Any of the Banc of America Alternative Loan Trust
2006-7 Mortgage Pass-Through Certificates, Series 2006-7 that are issued
pursuant to this Agreement.
Certificate Account: The Eligible Account created and maintained by
the Trustee pursuant to Section 3.08(c) in the name of the Trustee for the
benefit of the Certificateholders and designated "Xxxxx Fargo Bank, N.A., in
trust for registered holders of Banc of America Alternative Loan Trust 2006-7
Mortgage Pass-Through Certificates, Series 2006-7." Funds in the Certificate
Account shall be held in trust for the Holders of the Certificates for the uses
and purposes set forth in this Agreement.
Certificate Balance: With respect to any Certificate at any date
(other than a Class CE or Class R Certificate), the maximum dollar amount of
principal to which the Holder thereof is then entitled hereunder, such amount
being equal to the product of the Percentage Interest of such Certificate and
the Class Certificate Balance of the Class of Certificates of which such
Certificate is a part.
Certificate Custodian: Initially, Xxxxx Fargo Bank, N.A.; thereafter
any other Certificate Custodian acceptable to the Depository and selected by the
Trustee.
Certificate Interest Rate: With respect to each Class of
Certificates, the per annum rate set forth or calculated in the table under the
caption "REMIC 2" in the Preliminary Statement.
Certificate Owner: With respect to a Book-Entry Certificate, the
Person who is the beneficial owner of a Book-Entry Certificate. With respect to
any Definitive Certificate, the Certificateholder of such Certificate.
Certificate Register: The register maintained pursuant to Section
6.02.
Certificate Registrar: The registrar appointed pursuant to Section
6.02.
Certificateholder: The Person in whose name a Certificate is
registered in the Certificate Register, except that, solely for the purpose of
giving any consent pursuant to this Agreement, any Certificate registered in the
name of the Depositor, the Servicer or any affiliate thereof shall be deemed not
to be outstanding and the Percentage Interest and Voting Rights evidenced
thereby shall not be taken into account in determining whether the requisite
amount of Percentage Interests or Voting Rights, as the case may be, necessary
to effect any such consent has been obtained, unless such entity is the
registered owner of the entire Class of Certificates, provided that the Trustee
shall not be responsible for knowing that any Certificate is registered in the
name of such an affiliate unless one of its Responsible Officers has actual
knowledge.
Certification: As defined in Section 3.22(c).
Class: As to the Certificates, the Class A-1, Class A-2, Class A-3,
Class A-4, Class X-0, Xxxxx X-0, Class M-1, Class M-2, Class M-3, Class M-4,
Class M-5, Class CE and Class R, as the case may be.
Class A-1 Pass-Through Rate: For each Distribution Date, a per annum
rate equal to 5.8998%.
Class A-2 Pass-Through Rate: For each Distribution Date, a per annum
rate equal to 5.7073%.
Class A-3 Pass-Through Rate: For each Distribution Date, a per annum
rate equal to 5.9133%.
Class A-4 Pass-Through Rate: For each Distribution Date on and prior
to the Optional Termination Date, a per annum rate equal to 5.9983% and for each
Distribution Date after the Optional Termination Date, a per annum rate equal to
6.4983%.
Class A-5 Pass-Through Rate: For each Distribution Date on and prior
to the Optional Termination Date, a per annum rate equal to 6.2262% and for each
Distribution Date after the Optional Termination Date, a per annum rate equal to
6.7262%.
Class A-6 Pass-Through Rate: For each Distribution Date on and prior
to the Optional Termination Date, a per annum rate equal to 5.8594% and for each
Distribution Date after the Optional Termination Date, a per annum rate equal to
6.3594%.
Class Certificate Balance: With respect to any Class (other than the
Class CE and Class R Certificates) and any date of determination, the Initial
Class Certificate Balance of such Class (A) reduced by the sum of (i) all
distributions of principal made with respect thereto and (ii) Applied Realized
Loss Amounts allocated thereto for previous Distribution Dates and (B) increased
by any Recoveries allocated to such Class for previous Distribution Dates. The
Class CE and Class R Certificates do not have a Class Certificate Balance.
Class CE Distributable Amount: With respect to any Distribution
Date, (x) the sum of (i) the interest accrued on such Class CE Certificate at
its Pass-Through Rate calculated on its Notional Amount less the amount (without
duplication) of Cap Carryover Amounts and (ii) the Overcollateralization Release
Amount.
Class CE Uncertificated Principal Balance: As of any date of
determination, the Initial Overcollateralization Amount minus the sum of (i) any
Realized Losses allocated thereto and (ii) any amounts distributed (or deemed
distributed) to the Class CE Certificates with respect thereto.
Class M Certificates: The Class M-1, Class M-2, Class M-3, Class M-4
and Class M-5 Certificates.
Class M-1 Pass-Through Rate: For each Distribution Date on and prior
to the Optional Termination Date, a per annum rate equal to 6.0488% and for each
Distribution Date after the Optional Termination Date, a per annum rate equal to
6.5488%.
Class M-1 Principal Distribution Amount: As of any Distribution Date
on or after the Stepdown Date and as long as a Trigger Event is not in effect,
the excess of (x) the sum of (i) the sum of the Class Certificate Balances of
the Senior Certificates (after taking into account the payment of the Senior
Principal Distribution Amount on such Distribution Date) and (ii) the Class
Certificate Balance of the Class M-1 Certificates immediately prior to such
Distribution Date over (y) the lesser of (a) the product of (i) 95.00% and (ii)
the aggregate Stated Principal Balance of the Mortgage Loans as of the last day
of the related Collection Period after giving effect to Principal Prepayments
received during the calendar month preceding the month of that Distribution Date
and (b) the amount by which the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Collection Period after giving
effect to Principal Prepayments received during the calendar month preceding the
month of that Distribution Date exceeds the product of (i) 0.50% and (ii) the
aggregate Stated Principal Balance of the Mortgage Loans on the Cut-off Date.
Class M-1 Realized Loss Amortization Amount: As to the Class M-1
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-1 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 5.02(c)(i) through (iv) hereof, in each case
for such Distribution Date.
Class M-2 Pass-Through Rate: For each Distribution Date on and prior
to the Optional Termination Date, a per annum rate equal to 6.2465% and for each
Distribution Date after the Optional Termination Date, a per annum rate equal to
6.7465%.
Class M-2 Principal Distribution Amount: As of any Distribution Date
on or after the Stepdown Date and as long as a Trigger Event is not in effect,
the excess of (x) the sum of (i) the sum of the Class Certificate Balances of
the Senior Certificates (after taking into account the payment of the Senior
Principal Distribution Amount on such Distribution Date), (ii) the Class
Certificate Balance of the Class M-1 Certificates (after taking into account the
payment of the Class M-1 Principal Distribution Amount on such Distribution
Date) and (iii) the Class Certificate Balance of the Class M-2 Certificates
immediately prior to such Distribution Date over (y) the lesser of (a) the
product of (i) 96.00% and (ii) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Collection Period after giving
effect to Principal Prepayments received during the calendar month preceding the
month of that Distribution Date and (b) the amount by which the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related
Collection Period after giving effect to Principal Prepayments received during
the calendar month preceding the month of that Distribution Date exceeds the
product of (i) 0.50% and (ii) the aggregate Stated Principal Balance of the
Mortgage Loans on the Cut-off Date.
Class M-2 Realized Loss Amortization Amount: As to the Class M-2
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-2 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 5.02(c)(i) through (vii) hereof, in each
case for such Distribution Date.
Class M-3 Pass-Through Rate: For each Distribution Date on and prior
to the Optional Termination Date, a per annum rate equal to 6.4432% and for each
Distribution Date after the Optional Termination Date, a per annum rate equal to
6.9432%.
Class M-3 Principal Distribution Amount: As of any Distribution Date
on or after the Stepdown Date and as long as a Trigger Event is not in effect,
the excess of (x) the sum of (i) the sum of the Class Certificate Balances of
the Senior Certificates (after taking into account the payment of the Senior
Principal Distribution Amount on such Distribution Date), (ii) the Class
Certificate Balance of the Class M-1 Certificates (after taking into account the
payment of the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii) the Class Certificate Balance of the Class M-2 Certificates (after
taking into account the payment of the Class M-2 Principal Distribution Amount
on such Distribution Date) and (iv) the Class Certificate Balance of the Class
M-3 Certificates immediately prior to such Distribution Date over (y) the lesser
of (a) the product of (i) 97.00% and (ii) the aggregate Stated Principal Balance
of the Mortgage Loans as of the last day of the related Collection Period after
giving effect to Principal Prepayments received during the calendar month
preceding the month of that Distribution Date and (b) the amount by which the
aggregate Stated Principal Balance of the Mortgage Loans as of the last day of
the related Collection Period after giving effect to Principal Prepayments
received during the calendar month preceding the month of that Distribution Date
exceeds the product of (i) 0.50% and (ii) the aggregate Stated Principal Balance
of the Mortgage Loans on the Cut-off Date.
Class M-3 Realized Loss Amortization Amount: As to the Class M-3
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-3 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 5.02(c)(i) through (x) hereof, in each case
for such Distribution Date.
Class M-4 Pass-Through Rate: For each Distribution Date on and prior
to the Optional Termination Date, a per annum rate equal to 6.8872% and for each
Distribution Date after the Optional Termination Date, a per annum rate equal to
7.3872%.
Class M-4 Principal Distribution Amount: As of any Distribution Date
on or after the Stepdown Date and as long as a Trigger Event is not in effect,
the excess of (x) the sum of (i) the sum of the Class Certificate Balances of
the Senior Certificates (after taking into account the payment of the Senior
Principal Distribution Amount on such Distribution Date), (ii) the Class
Certificate Balance of the Class M-1 Certificates (after taking into account the
payment of the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii) the Class Certificate Balance of the Class M-2 Certificates (after
taking into account the payment of the Class M-2 Principal Distribution Amount
on such Distribution Date), (iv) the Class Certificate Balance of the Class M-3
Certificates (after taking into account the payment of the Class M-3 Principal
Distribution Amount on such Distribution Date) and (v) the Class Certificate
Balance of the Class M-4 Certificates immediately prior to such Distribution
Date over (y) the lesser of (a) the product of (i) 98.00% and (ii) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the related
Collection Period after giving effect to Principal Prepayments received during
the calendar month preceding the month of that Distribution Date and (b) the
amount by which the aggregate Stated Principal Balance of the Mortgage Loans as
of the last day of the related Collection Period after giving effect to
Principal Prepayments received during the calendar month preceding the month of
that Distribution Date exceeds the product of (i) 0.50% and (ii) the aggregate
Stated Principal Balance of the Mortgage Loans on the Cut-off Date.
Class M-4 Realized Loss Amortization Amount: As to the Class M-4
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-4 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 5.02(c)(i) through (xiii) hereof, in each
case for such Distribution Date.
Class M-5 Pass-Through Rate: For each Distribution Date on and prior
to the Optional Termination Date, a per annum rate equal to 7.1000% and for each
Distribution Date after the Optional Termination Date, a per annum rate equal to
7.6000%.
Class M-5 Principal Distribution Amount: As of any Distribution Date
on or after the Stepdown Date and as long as a Trigger Event is not in effect,
the excess of (x) the sum of (i) the sum of the Class Balances of the Senior
Certificates (after taking into account the payment of the Senior Principal
Distribution Amount on such Distribution Date), (ii) the Class Balance of the
Class M-1 Certificates (after taking into account the payment of the Class M-1
Principal Distribution Amount on such Distribution Date), (iii) the Class
Balance of the Class M-2 Certificates (after taking into account the payment of
the Class M-2 Principal Distribution Amount on such Distribution Date), (iv) the
Class Balance of the Class M-3 Certificates (after taking into account the
payment of the Class M-3 Principal Distribution Amount on such Distribution
Date), (v) the Class Balance of the Class M-4 Certificates (after taking into
account the payment of the Class M-4 Principal Distribution Amount on such
Distribution Date) and (vi) the Class Balance of the Class M-5 Certificates
immediately prior to such Distribution Date over (y) the lesser of (a) the
product of (i) 99.00% and (ii) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Collection Period after giving
effect to Principal Prepayments received during the calendar month preceding the
month of that Distribution Date and (b) the amount by which the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related
Collection Period after giving effect to Principal Prepayments received during
the calendar month preceding the month of that Distribution Date exceeds the
product of (i) 0.50% and (ii) the aggregate Stated Principal Balance of the
Mortgage Loans on the Cut-off Date.
Class M-5 Realized Loss Amortization Amount: As to the Class M-5
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-5 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 5.02(c)(i) through (xvi) hereof, in each
case for such Distribution Date.
Class R Certificate: The Class R Certificate executed by the Trustee
on behalf of the Trust, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit B-7 and
evidencing the ownership of the residual interest in each of REMIC 1 and REMIC
2. The Class R Certificate represents the ownership of the Class R-1 Interest
and the Class R-2 Interest.
Class R-1 Interest: The uncertificated residual interest in REMIC 1.
Class R-2 Interest: The uncertificated residual interest in REMIC 2.
Closing Date: September 28, 2006.
Code: The Internal Revenue Code of 1986, as amended.
Collection Period: With respect to any Distribution Date, the period
from the second day of the calendar month preceding the month in which such
Distribution Date occurs through the first day of the month in which such
Distribution Date occurs.
Compensating Interest: With respect to any Distribution Date, the
least of (a) the aggregate Servicing Fee for such Distribution Date (before
giving effect to any reduction pursuant to Section 3.17), (b) the Prepayment
Interest Shortfall for such Distribution Date and (c) one-twelfth of 0.25% of
the aggregate Stated Principal Balance of the Mortgage Loans as of the Due Date
in the month preceding the month of such Distribution Date.
Co-op Shares: Shares issued by private non-profit housing
corporations.
Corporate Trust Office: The principal corporate trust office of the
Trustee at which at any particular time its corporate trust business with
respect to this Agreement is conducted, which office at the date of the
execution of this instrument is located at 0000 Xxx Xxxxxxxxx Xxxx, Xxxxxxxx,
Xxxxxxxx 00000-0000, Attention: Corporate Trust Services - BOALT 2006-7, and for
certificate transfer purposes is located at Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx,
Xxxxxxxxxxx, Xxxxxxxxx 00000, Attention: Corporate Trust Services - BOALT
2006-7, or at such other address as the Trustee may designate from time to time
by notice to the Certificateholders, the Depositor and the Servicer.
Corresponding Classes: With respect to REMIC 1 and REMIC 2, the
following Classes shall be Corresponding Classes:
Corresponding REMIC 1 Classes Corresponding REMIC 2 Classes
----------------------------- -----------------------------
LT1A1 Class A-1 Certificates
LT1A2 Class A-2 Certificates
LT1A3 Class A-3 Certificates
LT1A4 Class A-4 Certificates
LT1A5 Class A-5 Certificates
LT1A6 Class A-6 Certificates
LT1M1 Class M-1 Certificates
LT1M2 Class M-2 Certificates
LT1M3 Class M-3 Certificates
LT1M4 Class M-4 Certificates
LT1M5 Class M-5 Certificates
Custodian: Initially, the Trustee, and thereafter the Custodian, if
any, hereafter appointed by the Trustee pursuant to Section 9.12. The Custodian
may (but need not) be the Trustee or any Person directly or indirectly
controlling or controlled by or under common control of either of them. Neither
the Servicer nor the Depositor, nor any Person directly or indirectly
controlling or controlled by or under common control with any such Person may be
appointed Custodian.
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Customary Servicing Procedures: With respect to the Servicer,
procedures (including collection procedures) that the Servicer customarily
employs and exercises in servicing and administering mortgage loans for its own
account and which are in accordance with accepted mortgage servicing practices
of prudent lending institutions servicing mortgage loans of the same type as the
Mortgage Loans in the jurisdictions in which the related Mortgaged Properties
are located.
Cut-off Date: September 1, 2006.
Cut-off Date Pool Principal Balance: The aggregate of the Cut-off
Date Principal Balances of the Mortgage Loans, which is $670,632,422.63.
Cut-off Date Principal Balance: As to any Mortgage Loan, the unpaid
principal balance thereof as of the close of business on the Cut-off Date,
reduced by all installments of principal due on or prior thereto whether or not
paid.
Debt Service Reduction: As to any Mortgage Loan and any
Determination Date, the excess of (i) the Monthly Payment due on the related Due
Date under the terms of such Mortgage Loan over (ii) the amount of the monthly
payment of principal and/or interest required to be paid with respect to such
Due Date by the Mortgagor as established by a court of competent jurisdiction
(pursuant to an order which has become final and nonappealable) as a result of a
proceeding initiated by or against the related Mortgagor under the Bankruptcy
Code, as amended from time to time (11 U.S.C.); provided that no such excess
shall be considered a Debt Service Reduction so long as (a) the Servicer is
pursuing an appeal of the court order giving rise to any such modification and
(b)(1) such Mortgage Loan is not in default with respect to payment due
thereunder in accordance with the terms of such Mortgage Loan as in effect on
the Cut-off Date or (2) Monthly Payments are being advanced by the Servicer in
accordance with the terms of such Mortgage Loan as in effect on the Cut-off
Date.
Debt Service Reduction Mortgage Loan: Any Mortgage Loan that became
the subject of a Debt Service Reduction.
Defective Mortgage Loan: Any Mortgage Loan which is required to be
cured, repurchased or substituted for pursuant to Section 2.02 or 2.04.
Deficient Valuation: As to any Mortgage Loan and any Determination
Date, the excess of (i) the then outstanding indebtedness under such Mortgage
Loan over (ii) the secured valuation thereof established by a court of competent
jurisdiction (pursuant to an order which has become final and nonappealable) as
a result of a proceeding initiated by or against the related Mortgagor under the
Bankruptcy Code, as amended from time to time (11 U.S.C.), pursuant to which
such Mortgagor retained such Mortgaged Property; provided that no such excess
shall be considered a Deficient Valuation so long as (a) the Servicer is
pursuing an appeal of the court order giving rise to any such modification and
(b)(1) such Mortgage Loan is not in default with respect to payments due
thereunder in accordance with the terms of such Mortgage Loan as in effect on
the Cut-off Date or (2) Monthly Payments are being advanced by the Servicer in
accordance with the terms of such Mortgage Loan as in effect on the Cut-off
Date.
Deficient Valuation Mortgage Loan: Any Mortgage Loan that became the
subject of a Deficient Valuation.
Definitive Certificates: As defined in Section 6.02(c)(iii).
Denomination: The amount, if any, specified on the face of each
Certificate representing the principal portion of the Initial Class Certificate
Balance evidenced by such Certificate.
Depositor: Banc of America Mortgage Securities, Inc., a Delaware
corporation, or its successor in interest, as depositor of the Trust Estate.
Depository: The Depository Trust Company, the nominee of which is
Cede & Co., as the registered Holder of the Book-Entry Certificates or any
successor thereto appointed in accordance with this Agreement. The Depository
shall at all times be a "clearing corporation" as defined in Section 8-102(3) of
the Uniform Commercial Code of the State of New York.
Depository Participant: A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
Determination Date: As to any Distribution Date, the 16th day of the
month of the related Distribution Date or, if such 16th day is not a Business
Day, the Business Day immediately preceding such 16th day.
Distribution Date: The 25th day of each month beginning in October
2006 (or, if such day is not a Business Day, the next Business Day).
Due Date: As to any Distribution Date and each Mortgage Loan, the
first day in the calendar month of such Distribution Date.
Eligible Account: Any of (i) an account or accounts maintained with
(a) Bank of America, or (b) a federal or state chartered depository institution
or trust company the short-term unsecured debt obligations of which (or, in the
case of a depository institution or trust company that is the principal
subsidiary of a holding company, the debt obligations of such holding company)
have the highest short-term ratings of each Rating Agency at the time any
amounts are held on deposit therein, or (ii) an account or accounts in a
depository institution or trust company in which such accounts are insured by
the FDIC (to the limits established by the FDIC) and the uninsured deposits in
which accounts are otherwise secured such that, as evidenced by an Opinion of
Counsel delivered to the Trustee and to each Rating Agency, the
Certificateholders have a claim with respect to the funds in such account or a
perfected first priority security interest against any collateral (which shall
be limited to Permitted Investments) securing such funds that is superior to
claims of any other depositors or creditors of the depository institution or
trust company in which such account is maintained, or (iii) a trust account or
accounts maintained with the trust department of a federal or state chartered
depository institution or trust company, acting in its fiduciary capacity or
(iv) any other account acceptable to each Rating Agency. Eligible Accounts may
bear interest and may include, if otherwise qualified under this definition,
accounts maintained with the Trustee or Bank of America.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA Restricted Certificates: Any Class M, Class CE or Class R
Certificate.
Escrow Account: As defined in Section 3.09(a).
Escrow Payments: The amounts constituting taxes, assessments,
Primary Insurance Policy premiums, fire and hazard insurance premiums and other
payments as may be required to be escrowed by the Mortgagor with the mortgagee
pursuant to the terms of any Mortgage Note or Mortgage.
Events of Default: As defined in Section 8.01.
Excess Proceeds: With respect to any Liquidated Mortgage Loan, the
amount, if any, by which the sum of any Liquidation Proceeds of such Mortgage
Loan received in the calendar month in which such Mortgage Loan became a
Liquidated Mortgage Loan, net of any amounts previously reimbursed to the
Servicer as Nonrecoverable Advance(s) with respect to such Mortgage Loan
pursuant to Section 3.11(a)(iii), exceeds (i) the unpaid principal balance of
such Liquidated Mortgage Loan as of the Due Date in the month in which such
Mortgage Loan became a Liquidated Mortgage Loan plus (ii) accrued interest at
the Mortgage Interest Rate from the Due Date as to which interest was last paid
or for which a Periodic Advance was made (and not reimbursed) up to the Due Date
applicable to the Distribution Date immediately following the calendar month
during which such liquidation occurred.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Extra Principal Distribution Amount: As of any Distribution Date,
the lesser of (x) the Monthly Excess Interest Amount for such Distribution Date
and (y) the Overcollateralization Deficiency for such Distribution Date.
FDIC: The Federal Deposit Insurance Corporation, or any successor
thereto.
Final Distribution Date: The Distribution Date on which the final
distribution in respect of the Certificates will be made pursuant to Section
10.01.
Financial Market Service: Bloomberg Financial Service and any other
financial information provider designated by the Depositor by written notice to
the Trustee.
FIRREA: The Financial Institutions Reform, Recovery and Enforcement
Act of 1989, as amended.
Form 8-K: As defined in Section 3.22(a).
Form 8-K Information: As defined in Section 3.22(d).
Form 10-D: As defined in Section 3.22(a).
Form 10-K: As defined in Section 3.22(a).
Grantor Trust: That portion of the Trust exclusive of the REMICs
consisting of the right of the Offered Certificates to receive Cap Carryover
Amounts and the obligation of the Class CE Certificates to pay Cap Carryover
Amounts.
Holder: A Certificateholder.
Independent: When used with respect to any specified Person means
such a Person who (i) is in fact independent of the Depositor and the Servicer,
(ii) does not have any direct financial interest or any material indirect
financial interest in the Depositor or the Servicer or in an affiliate of either
of them, and (iii) is not connected with the Depositor or the Servicer as an
officer, employee, promoter, underwriter, trustee, partner, director or person
performing similar functions.
Initial Class Certificate Balance: With respect to each Class of
Certificates, the Class Certificate Balance thereof on the Closing Date, as set
forth opposite such Class in the Preliminary Statement, except with respect to
(i) the Class R Certificate, which has an Initial Class Certificate Balance of
zero and (ii) the Class CE Certificates, which, solely for REMIC purposes, have
an Initial Class Certificate Balance equal to the Initial Overcollateralization
Amount.
Initial Overcollateralization Amount: $3,354,422.63.
Insurance Policy: With respect to any Mortgage Loan included in the
Trust Estate, any related insurance policy, including all riders and
endorsements thereto in effect, including any replacement policy or policies for
any Insurance Policies.
Insurance Proceeds: Proceeds paid by an insurer pursuant to any
Insurance Policy, in each case other than any amount included in such Insurance
Proceeds in respect of Insured Expenses.
Insured Expenses: Expenses covered by an Insurance Policy or any
other insurance policy with respect to the Mortgage Loans.
Interest Accrual Period: As to any Distribution Date and each Class
of Offered Certificates, the period from and including the first day of the
calendar month preceding the calendar month of such Distribution Date to but not
including the first day of the calendar month of such Distribution Date.
Interest Carry Forward Amount: For any Class of Certificates (other
than the Class CE and Class R Certificates) and any Distribution Date, the sum
of (a) the excess, if any, of the Accrued Certificate Interest for such
Distribution Date over the amount in respect of interest actually distributed on
such Class for such Distribution Date, (b) any remaining unpaid Interest Carry
Forward Amount from prior Distribution Dates and (c) interest on such remaining
Interest Carry Forward Amount referred to in clause (b) at the applicable
Certificate Interest Rate for the related Interest Accrual Period.
Interest Remittance Amount: As of any Distribution Date, the sum of,
without duplication:
(i) the interest portion of any Monthly Payment on the Mortgage
Loans (net of the related Servicing Fee, amounts available for reimbursement to
the Servicer of Advances and expenses pursuant to this Agreement and amounts
reimbursable or payable to the Trustee pursuant to this Agreement) and all
Periodic Advances with respect to the related Collection Period which is
received by the Servicer on or prior to the related Determination Date (or in
the case of any Monthly Covered Amount, the related Remittance Date),
(ii) all Compensating Interest paid by the Servicer in respect of
such Distribution Date and deposited to the Servicer Custodial Account pursuant
to Section 3.08(b)(vii);
(iii) the portion of all Principal Prepayments (other than Total
Covered Amounts) relating to interest received on the Mortgage Loans during the
month preceding the month of such Distribution Date and deposited to the
Servicer Custodial Account pursuant to Section 3.08(b)(i) during such period and
all Total Covered Amounts received and deposited in the Servicer Custodial
Account by the related Remittance Date;
(iv) the portion of any payment in connection with Liquidation
Proceeds (net of expenses) relating to interest received on the Mortgage Loans
during the preceding calendar month and deposited to the Servicer Custodial
Account pursuant to Section 3.08(b)(iii);
(v) in connection with Defective Mortgage Loans, the portion of the
aggregate of the Repurchase Prices and Substitution Adjustment Amounts relating
to interest received during the calendar month preceding the month of that
Distribution Date deposited on the related Remittance Date pursuant to Section
3.08(b)(vi);
(vi) any other amounts in the Servicer Custodial Account deposited
therein pursuant to Sections 3.08(b)(iv) and (vii) in respect of such
Distribution Date;
(vii) any Reimbursement Amount on the Mortgage Loans received during
the calendar month preceding the month of that Distribution Date; and
(viii) on the Distribution Date on which the Mortgage Loans and
related REO Property are purchased in accordance with Section 10.01 hereof, that
portion of the purchase price therefor in respect of interest with respect to
such Distribution Date.
Liquidated Mortgage Loan: With respect to any Distribution Date, a
defaulted Mortgage Loan (including any REO Property) that was liquidated in the
calendar month preceding the month of such Distribution Date and as to which the
Servicer has certified (in accordance with this Agreement) that it has received
all proceeds it expects to receive in connection with the liquidation of such
Mortgage Loan including the final disposition of an REO Property.
Liquidation Proceeds: Amounts, including Insurance Proceeds,
received in connection with the partial or complete liquidation of defaulted
Mortgage Loans, whether through trustee's sale, foreclosure sale or otherwise or
amounts received in connection with any condemnation or partial release of a
Mortgaged Property and any other proceeds received in connection with an REO
Property, less the sum of related unreimbursed Servicing Fees and Advances.
Loan-to-Value Ratio: With respect to any Mortgage Loan and any date
of determination, the fraction, expressed as a percentage, the numerator of
which is the outstanding principal balance of the related Mortgage Loan at the
date of determination and the denominator of which is the Appraised Value of the
related Mortgaged Property.
Majority Class CE Certificateholders: The Holders of Class CE
Certificates evidencing at least a 51% Percentage Interest in the Class CE
Certificates.
Marker Rate: With respect to the Class CE Certificates and any
Distribution Date, a per annum rate equal to two (2) times the weighted average
of the Uncertificated REMIC 1 Pass-Through Rates for REMIC 1 Regular Interest
LT1A1, REMIC 1 Regular Interest LT1A2, REMIC 1 Regular Interest LT1A3, REMIC 1
Regular Interest LT1A4, REMIC 1 Regular Interest LT1A5, REMIC 1 Regular Interest
LT1A6, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1
Regular Interest LT1M3, REMIC 1 Regular Interest LT1M4, REMIC 1 Regular Interest
LT1M5, and REMIC 1 Regular Interest LT1ZZ, (i) with the rate on each such REMIC
Regular Interest (other than REMIC 1 Regular Interest LT1ZZ) subject to a cap
equal to the Pass-Through Rate of its Corresponding Class (taking into account
in determining any such Pass-through Rate the imposition of the Pool Cap as
described in footnotes (1) through (11) to the table in the Preliminary
Statement relating to the Certificates) for the purposes of this calculation and
(ii) with the rate on REMIC 1 Regular Interest LT1ZZ subject to a cap of zero
for the purpose of this calculation; provided, however, that for this purpose,
calculations of the Uncertificated REMIC 1 Pass-Through Rate and the related cap
with respect to each such REMIC Regular Interest (other than REMIC 1 Regular
Interest LT1ZZ) shall be multiplied by a fraction, the numerator of which is the
actual number of days in the Interest Accrual Period and the denominator of
which is 30.
Maximum LT1ZZ Uncertificated Accrued Interest Deferral Amount: With
respect to any Distribution Date, the excess of (a) accrued interest at the
Uncertificated REMIC 1 Pass-Through Rate applicable to REMIC 1 Regular Interest
LT1ZZ for such Distribution Date on a balance equal to the Uncertificated
Principal Balance of REMIC 1 Regular Interest LT1ZZ minus the REMIC 1
Overcollateralized Amount, in each case for such Distribution Date, over (b)
Uncertificated Accrued Interest on REMIC 1 Regular Interest LT1A1, REMIC 1
Regular Interest LT1A2, REMIC 1 Regular Interest LT1A3, REMIC 1 Regular Interest
LT1A4, REMIC 1 Regular Interest LT1A5, REMIC 1 Regular Interest LT1A6, REMIC 1
Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest
LT1M3, REMIC 1 Regular Interest LT1M4 and REMIC 1 Regular Interest LT1M5 each
subject to a cap equal to the Pass-Through Rate of the related Corresponding
Class for the purpose of this calculation; provided, however, that for this
purpose, calculations of the Uncertificated REMIC 1 Pass-Through Rate and the
related caps with respect to Uncertificated Accrued Interest on REMIC 1 Regular
Interest LT1A1, REMIC 1 Regular Interest LT1A2, REMIC 1 Regular Interest LT1A3,
REMIC 1 Regular Interest LT1A4, REMIC 1 Regular Interest LT1A5, REMIC 1 Regular
Interest LT1A6, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2,
REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest LT1M4 and REMIC 1
Regular Interest LT1M5 shall be multiplied by a fraction, the numerator of which
is the actual number of days in the Interest Accrual Period and the denominator
of which is 30.
MERS: As defined in Section 2.01(b)(iii).
Monthly Covered Amount: As defined in the Mortgage Loan Purchase
Agreement.
Monthly Excess Cashflow Allocation: As defined in Section 5.02(c).
Monthly Excess Cashflow Amount: The sum of the Monthly Excess
Interest Amount, the Overcollateralization Release Amount and (without
duplication) any portion of the Principal Distribution Amount remaining after
principal distributions on the Offered Certificates.
Monthly Excess Interest Amount: With respect to each Distribution
Date, the amount, if any, by which the Interest Remittance Amount for such
Distribution Date exceeds the aggregate amount distributed on such Distribution
Date pursuant to paragraphs (i) through (viii) under Section 5.02(a).
Monthly Payment: The scheduled monthly payment on a Mortgage Loan
due on any Due Date allocable to principal and/or interest on such Mortgage Loan
which, unless otherwise specified herein, shall give effect to any related Debt
Service Reduction and any Deficient Valuation that affects the amount of the
monthly payment due on such Mortgage Loan or the Monthly Covered Amount
representing such scheduled monthly payment.
Moody's: Xxxxx'x Investors Service, Inc., or any successor thereto.
Mortgage: The mortgage, deed of trust or other instrument creating a
first lien on a Mortgaged Property securing a Mortgage Note or creating a first
lien on a leasehold interest.
Mortgage File: The mortgage documents listed in Section 2.01
pertaining to a particular Mortgage Loan.
Mortgage Interest Rate: As to any Mortgage Loan, the per annum rate
of interest at which interest accrues on the principal balance of such Mortgage
Loan in accordance with the terms of the related Mortgage Note.
Mortgage Loan Purchase Agreement: The Mortgage Loan Purchase
Agreement, dated September 28, 2006, between Bank of America, as seller, and the
Depositor, as purchaser.
Mortgage Loan Schedule: The list delivered by the Servicer to the
Trustee and the Custodian of Mortgage Loans (as from time to time amended by the
Servicer to reflect the addition of Substitute Mortgage Loans and the deletion
of Defective Mortgage Loans pursuant to the provisions of this Agreement)
transferred to the Trustee as part of the Trust Estate and from time to time
subject to this Agreement, setting forth the following information with respect
to each Mortgage Loan: (i) the Mortgage Loan identifying number; (ii) a code
indicating whether the Mortgaged Property is owner-occupied; (iii) the property
type for each Mortgaged Property; (iv) the original months to maturity or the
remaining months to maturity from the Cut-off Date; (v) the Loan-to-Value Ratio
at origination; (vi) the Mortgage Interest Rate as of the Cut-off Date; (vii)
the date on which the first Monthly Payment was due on the Mortgage Loan, and,
if such date is not the Due Date currently in effect, such Due Date; (viii) the
stated maturity date; (ix) the amount of the Monthly Payment as of the Cut-off
Date; (x) the paid-through date; (xi) the original principal amount of the
Mortgage Loan; (xii) the principal balance of the Mortgage Loan as of the close
of business on the Cut-off Date, after application of payments of principal due
on or before the Cut-off Date, whether or not collected, and after deduction of
any payments collected of scheduled principal due after the Cut-off Date; (xiii)
a code indicating the purpose of the Mortgage Loan; (xiv) a code indicating the
documentation style; (xv) the Appraised Value; and (xvi) the closing date of
such Mortgage Loan. With respect to the Mortgage Loans in the aggregate, the
Mortgage Loan Schedule shall set forth the following information, as of the
Cut-off Date: (i) the number of Mortgage Loans; (ii) the current aggregate
outstanding principal balance of the Mortgage Loans; (iii) the weighted average
Mortgage Interest Rate of the Mortgage Loans; and (iv) the weighted average
months to maturity of the Mortgage Loans.
Mortgage Loans: Such of the mortgage loans transferred and assigned
to the Trustee pursuant to Section 2.01 as from time to time are held as a part
of the Trust Estate (including any Substitute Mortgage Loans and REO Property),
the Mortgage Loans originally so held being identified in the Mortgage Loan
Schedule.
Mortgage Note: The originally executed note or other evidence of
indebtedness evidencing the indebtedness of a Mortgagor under a Mortgage Loan,
together with all riders thereto and amendments thereof.
Mortgaged Property: The underlying property securing a Mortgage
Loan, which may include Co-op Shares or residential long-term leases.
Mortgagor: The obligor on a Mortgage Note.
Net Mortgage Interest Rate: As to any Mortgage Loan and Distribution
Date, such Mortgage Loan's Mortgage Interest Rate thereon on the first day of
the month preceding the month of the related Distribution Date reduced by (i)
the Servicing Fee Rate and (ii) the Trustee Fee Rate.
Non-U.S. Person: A Person other than a U.S. Person.
Nonrecoverable Advance: Any portion of an Advance previously made or
proposed to be made in respect of a Mortgage Loan which has not been previously
reimbursed and which, in the good faith judgment of the Servicer, will not or,
in the case of a proposed Advance, would not be ultimately recoverable from the
related Mortgagor, related Liquidation Proceeds, or other recoveries in respect
of the related Mortgage Loan.
Notional Amount: With respect to any Distribution Date and the Class
CE Interest and Class CE Certificates, an amount equal to the aggregate
principal balance of the REMIC 1 Regular Interests for such Distribution Date.
OCC: The Office of the Comptroller of the Currency.
Offered Certificates: The Senior and Class M Certificates.
Officer's Certificate: A certificate signed by the Chairman of the
Board, Vice Chairman of the Board, President or a Vice President and by the
Treasurer, the Secretary or one of the Assistant Treasurers or Assistant
Secretaries, or any other duly authorized officer of the Depositor or the
Servicer, as the case may be, and delivered to the Trustee.
Opinion of Counsel: A written opinion of counsel acceptable to the
Trustee, who may be counsel for the Depositor or the Servicer, except that any
opinion of counsel relating to the qualification of the Trust Estate as two
separate REMICs or compliance with the REMIC Provisions must be an opinion of
Independent counsel.
Optional Termination Date: The first Distribution Date on which the
Call Right Holder may opt to terminate the Mortgage Pool pursuant to Section
10.01.
OTS: The Office of Thrift Supervision.
Outstanding Mortgage Loan: As to any Due Date, a Mortgage Loan which
was not the subject of a Principal Prepayment in Full prior to such Due Date,
which did not become a Liquidated Mortgage Loan prior to such Due Date and which
was not purchased from the Trust prior to such Due Date pursuant to Section 2.02
or 2.04.
Overcollateralization Amount: As of any Distribution Date, the
excess, if any, of (x) the aggregate Stated Principal Balance of the Mortgage
Loans as of the last day of the related Collection Period after giving effect to
Principal Prepayments received during the calendar month preceding the month of
that Distribution Date over (y) the aggregate Class Certificate Balance of all
Classes of Certificates (after taking into account all distributions of
principal on such Distribution Date and the increase of any Class Certificate
Balance as a result of Recoveries).
Overcollateralization Deficiency: As of any Distribution Date, the
excess, if any, of (x) the Targeted Overcollateralization Amount for such
Distribution Date over (y) the Overcollateralization Amount for such
Distribution Date, calculated for this purpose after taking into account the
reduction on such Distribution Date of the Class Certificate Balances of all
Classes of Certificates resulting from the distribution of the Principal
Distribution Amount (but not the Extra Principal Distribution Amount) on such
Distribution Date, but prior to taking into account any Applied Realized Loss
Amounts on such Distribution Date.
Overcollateralization Release Amount: With respect to any
Distribution Date on or after the Stepdown Date on which a Trigger Event is not
in effect, the lesser of (x) the Principal Remittance Amount for such
Distribution Date and (y) the excess, if any, of (i) the Overcollateralization
Amount for such Distribution Date, assuming that 100% of the Principal
Remittance Amount is applied as a principal distribution on the Certificates on
such Distribution Date over (ii) the Targeted Overcollateralization Amount for
such Distribution Date. With respect to any Distribution Date on which a Trigger
Event is in effect, the Overcollateralization Release Amount will be zero.
Ownership Interest: As to any Certificate, any ownership or security
interest in such Certificate, including any interest in such Certificate as the
Holder thereof and any other interest therein, whether direct or indirect, legal
or beneficial, as owner or as pledgee.
Pass-Through Rate: Any of the Class A-1 Pass-Through Rate, the Class
A-2 Pass-Through Rate, the Class A-3 Pass-Through Rate, the Class A-4
Pass-Through Rate, the Class A-5 Pass-Through Rate, the Class A-6 Pass-Through
Rate, the Class M-1 Pass-Through Rate, the Class M-2 Pass-Through Rate, the
Class M-3 Pass-Through Rate, the Class M-4 Pass-Through Rate and the Class M-5
Pass-Through Rate; and in the case of any Regular Interest, the Pass-Through
Rate set forth in the definition thereof.
With respect to the Class CE Certificates and any Distribution Date,
a per annum rate equal to the percentage equivalent of a fraction, the numerator
of which is the sum of the amounts calculated pursuant to clauses (A) through
(M) below, and the denominator of which is the aggregate of the Uncertificated
Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC 1 Regular Interest
LT1A1, REMIC 1 Regular Interest LT1A2, REMIC 1 Regular Interest LT1A3, REMIC 1
Regular Interest LT1A4, REMIC 1 Regular Interest LT1A5, REMIC 1 Regular Interest
LT1A6, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1
Regular Interest LT1M3, REMIC 1 Regular Interest LT1M4, REMIC 1 Regular Interest
LT1M5 and REMIC 1 Regular Interest LT1ZZ. For purposes of calculating the
Pass-Through Rate for the Class CE Certificates, the numerator is equal to the
sum of the following components:
(A) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1AA minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1AA;
(B) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1A1 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1A1;
(C) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1A2 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1A2;
(D) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1A3 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1A3;
(E) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1A4 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1A4;
(F) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1A5 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1A5;
(G) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1A6 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1A6;
(H) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1M1 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M1;
(I) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1M2 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M2;
(J) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1M3 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M3;
(K) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1M4 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M4;
(L) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1M5 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M5; and
(M) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1ZZ minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1ZZ.
Paying Agent: As defined in Section 9.13.
Percentage Interest: As to any Certificate (other than a Class CE
and Class R Certificate), the percentage obtained by dividing the initial
Certificate Balance of such Certificate by the Initial Class Certificate Balance
of the Class of which such Certificate is a part. With respect to a Class CE
Certificate, the portion of the Class evidenced thereby, expressed as a
percentage, as stated on the face of such Certificate; provided, however, that
the sum of all such percentages for each such Class totals 100%. With respect to
a Residual Certificate, 100%.
Periodic Advance: The payment required to be made by the Servicer
with respect to any Distribution Date pursuant to Section 3.20, the amount of
any such payment being equal to the aggregate of Monthly Payments (net of the
Servicing Fee) on the Mortgage Loans (including any REO Property) that were due
on the related Due Date and not received as of the close of business on the
related Determination Date, less the aggregate amount of any such delinquent
payments that the Servicer has determined would constitute a Nonrecoverable
Advance if advanced.
Permitted Investments: One or more of the following:
(i) obligations of or guaranteed as to principal and interest
by the United States, Xxxxxxx Mac, Xxxxxx Xxx or any agency or
instrumentality of the United States when such obligations are
backed by the full faith and credit of the United States; provided
that such obligations of Xxxxxxx Mac or Xxxxxx Xxx shall be limited
to senior debt obligations and mortgage participation certificates
other than investments in mortgage-backed or mortgage participation
securities with yields evidencing extreme sensitivity to the rate of
principal payments on the underlying mortgages, which shall not
constitute Permitted Investments hereunder;
(ii) repurchase agreements on obligations specified in clause
(i) maturing not more than one month from the date of acquisition
thereof with a corporation incorporated under the laws of the United
States or any state thereof rated not lower than "P-1" by Moody's
and "A-1" by S&P;
(iii) federal funds, certificates of deposit, demand deposits,
time deposits and bankers' acceptances (which shall each have an
original maturity of not more than 90 days and, in the case of
bankers' acceptances, shall in no event have an original maturity of
more than 365 days or a remaining maturity of more than 30 days)
denominated in United States dollars of any U.S. depository
institution or trust company incorporated under the laws of the
United States or any state thereof, rated not lower than "P-1" by
Moody's and "A-1" by S&P;
(iv) commercial paper (having original maturities of not more
than 365 days) of any corporation incorporated under the laws of the
United States or any state thereof which is rated not lower than
"P-1" by Moody's and "A-1" by S&P;
(v) investments in money market funds (including funds of the
Trustee or its affiliates, or funds for which an affiliate of the
Trustee acts as advisor, as well as funds for which the Trustee and
its affiliates may receive compensation) rated "Aaa" by Moody's,
either "AAAm" or "AAAm G" by S&P or otherwise approved in writing by
each Rating Agency; and
(vi) other obligations or securities that are acceptable to
each Rating Agency and, as evidenced by an Opinion of Counsel
obtained by the Servicer, will not affect the qualification of the
Trust Estate as two separate REMICs;
provided, however, that no instrument shall be a Permitted Investment if it
represents either (a) the right to receive only interest payments with respect
to the underlying debt instrument or (b) the right to receive both principal and
interest payments derived from obligations underlying such instrument and the
principal and interest with respect to such instrument provide a yield to
maturity greater than 120% of the yield to maturity at par of such underlying
obligations.
Permitted Transferee: Any Person other than (i) the United States,
or any State or any political subdivision thereof, or any agency or
instrumentality of any of the foregoing, (ii) a foreign government,
international organization or any agency or instrumentality of either of the
foregoing, (iii) an organization which is exempt from tax imposed by Chapter 1
of the Code (including the tax imposed by Section 511 of the Code on unrelated
business taxable income) (except certain farmers' cooperatives described in Code
Section 521), (iv) rural electric and telephone cooperatives described in Code
Section 1381(a)(2)(C), (v) a Person with respect to whom the income on the
Residual Certificate is allocable to a foreign permanent establishment or fixed
base, within the meaning of an applicable income tax treaty, of such Person or
any other Person, and (vi) any other Person so designated by the Servicer based
on an Opinion of Counsel to the effect that any transfer to such Person may
cause the Trust or any other Holder of the Residual Certificate to incur tax
liability that would not be imposed other than on account of such transfer. The
terms "United States," "State" and "international organization" shall have the
meanings set forth in Code Section 7701 or successor provisions.
Person: Any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
Physical Certificates: The Class CE and Class R Certificates.
Plan: As defined in Section 6.02(e).
Pool Cap: For any Distribution Date and for the Offered
Certificates, a per annum rate equal to the weighted average of the Net Mortgage
Interest Rates for the Mortgage Loans, weighted on the basis of the Stated
Principal Balances of the Mortgage Loans as of the first day of the related
Collection Period.
Prepayment Interest Shortfall: As to any Distribution Date and each
Mortgage Loan subject to a Principal Prepayment received during the calendar
month preceding such Distribution Date, the amount, if any, by which one month's
interest at the related Mortgage Interest Rate (net of the Servicing Fee) on
such Principal Prepayment exceeds the amount of interest paid in connection with
such Principal Prepayment.
Principal Distribution Amount: As to any Distribution Date, the sum
of (i) the Principal Remittance Amount minus the Overcollateralization Release
Amount, if any, and (ii) the Extra Principal Distribution Amount, if any.
Principal Remittance Amount: As of any Distribution Date, the sum
(less amounts available for reimbursement to the Servicer of Advances and
expenses pursuant to this Agreement and amounts reimbursable or payable to the
Trustee and Servicer pursuant to this Agreement) of:
(i) the principal portion of the Monthly Payment on a Mortgage Loan
and all Periodic Advances with respect to the related Collection Period received
by the Servicer on or prior to the related Determination Date (or in the case of
any Monthly Covered Amount, the related Remittance Date);
(ii) the principal portion of all Liquidation Proceeds (net of
expenses) received on the Mortgage Loans during the preceding calendar month and
deposited to the Servicer Custodial Account pursuant to Section 3.08(b)(iii);
(iii) the portion of all Principal Prepayments (other than Total
Covered Amounts) relating to principal received on the Mortgage Loans during the
month preceding the month of such Distribution Date and deposited to the
Servicer Custodial Account pursuant to Section 3.08(b)(i) during such period and
all Total Covered Amounts received and deposited in the Servicer Custodial
Account by the related Remittance Date;
(iv) in connection with Defective Mortgage Loans, the principal
portion of the aggregate of the Repurchase Prices and Substitution Adjustment
Amounts received during the calendar month preceding the month of that
Distribution Date;
(v) any Recoveries with respect to such Distribution Date; and
(vi) on the Distribution Date on which the Mortgage Loans and
related REO Property are purchased in accordance with Section 10.01 hereof, that
portion of the purchase price therefor in respect of principal with respect to
such Distribution Date.
Primary Insurance Policy: Each policy of primary mortgage guaranty
insurance or any replacement policy therefor with respect to any Mortgage Loan,
in each case issued by an insurer acceptable to Xxxxxx Mae or Xxxxxxx Mac.
Principal Prepayment: Any payment or other recovery of principal on
a Mortgage Loan (other than Liquidation Proceeds) which is received in advance
of its scheduled Due Date and is not accompanied by an amount of interest
representing scheduled interest due on any date or dates in any month or months
subsequent to the month of prepayment, including the principal portion of any
Total Covered Amount.
Principal Prepayment in Full: Any Principal Prepayment of the entire
principal balance of a Mortgage Loan.
Priority Amount: For any Distribution Date the lesser of (i) the
Class Certificate Balance of the Class A-6 Certificates and (ii) the product of
(a) the Priority Percentage, (b) the Shift Percentage and (c) the Senior
Principal Distribution Amount.
Priority Percentage: For any Distribution Date (i) the Class
Certificate Balance of the Class A-6 Certificates divided by (ii) the sum of the
Class Certificate Balances of the Senior Certificates.
Private Certificates: The Class CE and Class R Certificates.
Qualified Appraiser: An appraiser of a Mortgaged Property duly
appointed by the originator of the related Mortgage Loan, who had no interest,
direct or indirect, in such Mortgaged Property or in any loan made on the
security thereof, whose compensation is not affected by the approval or
disapproval of the related Mortgage Loan and who met the minimum qualifications
of Xxxxxx Mae or Xxxxxxx Mac.
Rating Agency: Each of S&P and Xxxxx'x. If either such organization
or a successor is no longer in existence, "Rating Agency" shall be such
nationally recognized statistical rating organization, or other comparable
Person, as is designated by the Depositor, notice of which designation shall be
given to the Trustee. References herein to a given rating or rating category of
a Rating Agency shall mean such rating category without giving effect to any
modifiers.
Realized Loss: With respect to each Liquidated Mortgage Loan, an
amount as of the date of such liquidation, equal to (i) the unpaid principal
balance of the Liquidated Mortgage Loan as of the date of such liquidation, plus
(ii) interest at the Net Mortgage Interest Rate from the Due Date as to which
interest was last paid or advanced (and not reimbursed) to Certificateholders up
to the Due Date in the month in which Liquidation Proceeds are required to be
distributed on the Stated Principal Balance of such Liquidated Mortgage Loan
from time to time, minus (iii) the Liquidation Proceeds, if any, received during
the month in which such liquidation occurred, to the extent applied as
recoveries of interest at the Net Mortgage Interest Rate and to principal of the
Liquidated Mortgage Loan. With respect to each Mortgage Loan that has become the
subject of a Deficient Valuation, if the principal amount due under the related
Mortgage Note has been reduced, the difference between the principal balance of
the Mortgage Loan outstanding immediately prior to such Deficient Valuation and
the principal balance of the Mortgage Loan as reduced by the Deficient
Valuation. With respect to each Mortgage Loan that has become the subject of a
Debt Service Reduction and any Distribution Date, the amount, if any, by which
the principal portion of the related Monthly Payment has been reduced.
Realized Loss Amortization Amount: Any of the Class M-1 Realized
Loss Amortization Amount, the Class M-2 Realized Loss Amortization Amount, the
Class M-3 Realized Loss Amortization Amount, the Class M-4 Realized Loss
Amortization Amount and the Class M-5 Realized Loss Amortization Amount.
Record Date: The last day of the month (or, if such day is not a
Business Day, the preceding Business Day) preceding the month in which the
related Distribution Date occurs.
Recovery: Any amount (net of reimbursable expenses) received on a
Mortgage Loan subsequent to such Mortgage Loan being determined to be a
Liquidated Mortgage Loan that resulted in a Realized Loss in a prior month.
Refinance Mortgage Loan: Any Mortgage Loan the proceeds of which
were not used to purchase the related Mortgaged Property.
Regular Certificates: Any of the Offered Certificates and the Class
CE Certificates.
Regulation AB: Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. ss.ss.229.1100-229.1123, as such may be amended from
time to time, and subject to such clarification and interpretation as have been
provided by the Securities and Exchange Commission in the adopting release
(Asset-Backed Securities, Securities Act Release No. 33-8518, 70 Fed. Reg.
1,506, 1,531 (Jan. 7, 2005)) or by the staff of the Securities and Exchange
Commission, or as may be provided by the Securities and Exchange Commission or
its staff from time to time.
Reimbursement Amount: As defined in Section 2.04.
Relevant Servicing Criteria: The Servicing Criteria applicable to
the various parties, as set forth on Exhibit Q 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 Trustee or the Servicer, the term "Relevant Servicing Criteria"
may refer to a portion of the Relevant Servicing Criteria applicable to the
Servicer or the Trustee.
Relief Act: The Servicemembers Civil Relief Act, as it may be
amended from time to time.
Relief Act Reduction: With respect to any Distribution Date, for any
Mortgage Loan as to which there has been a reduction in the amount of interest
collectible thereon for the most recently ended calendar month as a result of
the application of the Relief Act or comparable state legislation, 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 pursuant to the
terms of the Mortgage Note on the same principal amount and for the same period
as the interest collectible on such Mortgage Loan for the most recently ended
calendar month.
REMIC: A "real estate mortgage investment conduit" within the
meaning of Section 860D of the Code.
REMIC 1 Interest Loss Allocation Amount: With respect to any
Distribution Date, an amount equal to (a) the product of (i) 50% of the sum of
the aggregate Principal Balance of the Mortgage Loans and related REO Properties
then outstanding and (ii) the Uncertificated REMIC 1 Pass-Through Rate for REMIC
1 Regular Interest LT1AA minus the Marker Rate, divided by (b) 12.
REMIC 1 Marker Allocation Percentage: 50% of any amount payable from
or loss attributable to the Mortgage Loans, which shall be allocated to REMIC 1
Regular Interest LT1AA, REMIC 1 Regular Interest LT1A1, REMIC 1 Regular Interest
LT1A2, REMIC 1 Regular Interest LT1A3, REMIC 1 Regular Interest LT1A4, REMIC 1
Regular Interest LT1A5, REMIC 1 Regular Interest LT1A6, REMIC 1 Regular Interest
LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1
Regular Interest LT1M4, REMIC 1 Regular Interest LT1M5 and REMIC 1 Regular
Interest LT1ZZ.
REMIC 1 Overcollateralization Target Amount: 0.50% of the Targeted
Overcollateralization Amount.
REMIC 1 Overcollateralized Amount: With respect to any date of
determination, (i) 0.50% of the aggregate Uncertificated Principal Balances of
the REMIC 1 Regular Interests minus (ii) the aggregate of the Uncertificated
Principal Balances of REMIC 1 Regular Interest LT1A1, REMIC 1 Regular Interest
LT1A2, REMIC 1 Regular Interest LT1A3, REMIC 1 Regular Interest LT1A4, REMIC 1
Regular Interest LT1A5, REMIC 1 Regular Interest LT1A6, REMIC 1 Regular Interest
LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1
Regular Interest LT1M4 and REMIC 1 Regular Interest LT1M5, in each case as of
such date of determination.
REMIC 1 Principal Loss Allocation Amount: With respect to any
Distribution Date, an amount equal to (a) the product of (i) 50% of the
aggregate Principal Balance of the Mortgage Loans and related REO Properties
then outstanding and (ii) 1 minus a fraction, the numerator of which is two
times the aggregate of the Uncertificated Principal Balances of REMIC 1 Regular
Interest LT1A1, REMIC 1 Regular Interest LT1A2, REMIC 1 Regular Interest LT1A3,
REMIC 1 Regular Interest LT1A4, REMIC 1 Regular Interest LT1A5, REMIC 1 Regular
Interest LT1A6, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2,
REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest LT1M4 and REMIC 1
Regular Interest LT1M5 and the denominator of which is the aggregate of the
Uncertificated Principal Balances of REMIC 1 Regular Interest LT1A1, REMIC 1
Regular Interest LT1A2, REMIC 1 Regular Interest LT1A3, REMIC 1 Regular Interest
LT1A4, REMIC 1 Regular Interest LT1A5, REMIC 1 Regular Interest LT1A6, REMIC 1
Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest
LT1M3, REMIC 1 Regular Interest LT1M4, REMIC 1 Regular Interest LT1M5 and REMIC
1 Regular Interest LT1ZZ.
REMIC 1 Regular Interest LT1AA: One of the separate non-certificated
beneficial ownership interests in REMIC 1 issued hereunder and designated as a
Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1AA shall accrue
interest at the related Uncertificated REMIC 1 Pass-Through Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.
REMIC 1 Regular Interest LT1A1: One of the separate non-certificated
beneficial ownership interests in REMIC 1 issued hereunder and designated as a
Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1A1 shall accrue
interest at the related Uncertificated REMIC 1 Pass-Through Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.
REMIC 1 Regular Interest LT1A2: One of the separate non-certificated
beneficial ownership interests in REMIC 1 issued hereunder and designated as a
Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1A2 shall accrue
interest at the related Uncertificated REMIC 1 Pass-Through Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance asset forth in the Preliminary Statement
hereto.
REMIC 1 Regular Interest LT1A3: One of the separate non-certificated
beneficial ownership interests in REMIC 1 issued hereunder and designated as a
Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1A3 shall accrue
interest at the related Uncertificated REMIC 1 Pass-Through Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance asset forth in the Preliminary Statement
hereto.
REMIC 1 Regular Interest LT1A4: One of the separate non-certificated
beneficial ownership interests in REMIC 1 issued hereunder and designated as a
Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1A4 shall accrue
interest at the related Uncertificated REMIC 1 Pass-Through Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance asset forth in the Preliminary Statement
hereto.
REMIC 1 Regular Interest LT1A5: One of the separate non-certificated
beneficial ownership interests in REMIC 1 issued hereunder and designated as a
Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1A5 shall accrue
interest at the related Uncertificated REMIC 1 Pass-Through Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance asset forth in the Preliminary Statement
hereto.
REMIC 1 Regular Interest LT1A6: One of the separate non-certificated
beneficial ownership interests in REMIC 1 issued hereunder and designated as a
Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1A6 shall accrue
interest at the related Uncertificated REMIC 1 Pass-Through Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance asset forth in the Preliminary Statement
hereto.
REMIC 1 Regular Interest LT1M1: One of the separate non-certificated
beneficial ownership interests in REMIC 1 issued hereunder and designated as a
Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M1 shall accrue
interest at the related Uncertificated REMIC 1 Pass-Through Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.
REMIC 1 Regular Interest LT1M2: One of the separate non-certificated
beneficial ownership interests in REMIC 1 issued hereunder and designated as a
Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M2 shall accrue
interest at the related Uncertificated REMIC 1 Pass-Through Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.
REMIC 1 Regular Interest LT1M3: One of the separate non-certificated
beneficial ownership interests in REMIC 1 issued hereunder and designated as a
Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M3 shall accrue
interest at the related Uncertificated REMIC 1 Pass-Through Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.
REMIC 1 Regular Interest LT1M4: One of the separate non-certificated
beneficial ownership interests in REMIC 1 issued hereunder and designated as a
Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M4 shall accrue
interest at the related Uncertificated REMIC 1 Pass-Through Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.
REMIC 1 Regular Interest LT1M5: One of the separate non-certificated
beneficial ownership interests in REMIC 1 issued hereunder and designated as a
Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M5 shall accrue
interest at the related Uncertificated REMIC 1 Pass-Through Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.
REMIC 1 Regular Interest LT1XX: One of the separate non-certificated
beneficial ownership interests in REMIC 1 issued hereunder and designated as a
Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1XX shall accrue
interest at the related Uncertificated REMIC 1 Pass-Through Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.
REMIC 1 Regular Interest LT1ZZ: One of the separate non-certificated
beneficial ownership interests in REMIC 1 issued hereunder and designated as a
Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1ZZ shall accrue
interest at the related Uncertificated REMIC 1 Pass-Through Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.
REMIC 1 Regular Interests: REMIC 1 Regular Interest LT1AA, REMIC 1
Regular Interest LT1A1, REMIC 1 Regular Interest LT1A2, REMIC 1 Regular Interest
LT1A3, REMIC 1 Regular Interest LT1A4, REMIC 1 Regular Interest LT1A5, REMIC 1
Regular Interest LT1A6, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest
LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest LT1M4, REMIC 1
Regular Interest LT1M5, REMIC 1 Regular Interest LT1XX and REMIC 1 Regular
Interest LT1ZZ.
REMIC 1 Sub WAC Allocation Percentage: 50% of any amount payable or
loss attributable from the Mortgage Loans, which shall be allocated to REMIC 1
Regular Interest LT1XX.
REMIC Regular Interest: Any REMIC 1 Regular Interest or any of the
Certificates (other than the Class R Certificate).
REMIC Certificate Maturity Date: The "latest possible maturity date"
of the Regular Certificates as that term is defined in Section 2.07.
REMIC Provisions: Provisions of the federal income tax law relating
to real estate mortgage investment conduits, which appear at Section 860A
through 860G of Subchapter M of Chapter 1 of the Code, and related provisions,
and regulations promulgated thereunder, as the foregoing may be in effect from
time to time, as well as provisions of applicable state laws.
Remittance Date: As to any Distribution Date, by 2:00 p.m. Eastern
time on the Business Day immediately preceding such Distribution Date.
REO Disposition Period: As defined in Section 3.14.
REO Proceeds: Proceeds, net of any related expenses of the Servicer,
received in respect of any REO Property (including, without limitation, proceeds
from the rental of the related Mortgaged Property) which are received prior to
the final liquidation of such Mortgaged Property.
REO Property: A Mortgaged Property acquired by the Servicer on
behalf of the Trust through foreclosure or deed-in-lieu of foreclosure in
connection with a defaulted Mortgage Loan.
Reportable Event: As defined in Section 3.22(d).
Repurchase Price: As to any Defective Mortgage Loan repurchased on
any date pursuant to Section 2.02 or 2.04, an amount equal to the sum of (i) the
unpaid principal balance thereof and (ii) the unpaid accrued interest thereon at
the applicable Mortgage Interest Rate from the Due Date to which interest was
last paid by the Mortgagor to the first day of the month following the month in
which such Mortgage Loan became eligible to be repurchased.
Request for Release: The Request for Release submitted by the
Servicer to the Trustee or the Custodian on behalf of the Trustee, substantially
in the form of Exhibit E.
Required Insurance Policy: With respect to any Mortgage Loan, any
insurance policy which is required to be maintained from time to time under this
Agreement in respect of such Mortgage Loan.
Residual Certificate: The Class R Certificate.
Responsible Officer: When used with respect to the Trustee, any
officer of the Corporate Trust Department of the Trustee, including any Senior
Vice President, any Vice President, any Assistant Vice President, any Assistant
Secretary, any Trust Officer or Assistant Trust Officer, or any other officer of
the Trustee customarily performing functions similar to those performed by any
of the above designated officers and having responsibility for the
administration of this Agreement.
S&P: Standard & Poor's, a division of The XxXxxx-Xxxx Companies,
Inc., or any successor thereto.
Seller: Bank of America, a national banking association, or its
successor in interest, as seller of the Mortgage Loans under the Mortgage Loan
Purchase Agreement.
Senior Certificates: The Class A-1, Class A-2, Class A-3, Class A-4,
Class A-5 and Class A-6 Certificates.
Senior Enhancement Percentage: For any Distribution Date, the
percentage obtained by dividing (x) the sum of (i) the aggregate Class
Certificate Balance of the Subordinate Certificates before taking into account
the distribution of the Principal Distribution Amount on such Distribution Date
and (ii) the Overcollateralization Amount after taking into account the
distribution of the Principal Distribution Amount as of the prior Distribution
Date by (y) the aggregate Stated Principal Balance of the Mortgage Loans as of
the last day of the related Collection Period after giving effect to Principal
Prepayments received during the calendar month preceding the month of that
Distribution Date.
Senior Principal Distribution Amount: With respect to any
Distribution Date (i) before the Stepdown Date or as to which a Trigger Event is
in effect, the Principal Distribution Amount and (ii) on or after the Stepdown
Date and as long as a Trigger Event is not in effect, the excess of (a) the
Class Certificate Balance of the Senior Certificates immediately prior to that
Distribution Date over (b) the lesser of (x) the product of (1) 91.10% and (2)
the aggregate Stated Principal Balance of the Mortgage Loans as of the last day
of the related Collection Period after giving effect to Principal Prepayments
received during the calendar month preceding the month of that Distribution Date
and (y) the amount by which the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Collection Period after giving
effect to Principal Prepayments received during the calendar month preceding the
month of that Distribution Date exceeds the product of (1) 0.50% and (2) the
aggregate Stated Principal Balance of the Mortgage Loans on the Cut-off Date.
Servicer: Bank of America, a national banking association, or its
successor in interest, in its capacity as servicer of the Mortgage Loans, or any
successor servicer appointed as herein provided.
Servicer Advance Date: As to any Distribution Date, 11:30 a.m.,
Eastern time, on the Business Day immediately preceding such Distribution Date.
Servicer Custodial Account: The separate Eligible Account or
Accounts created and maintained by the Servicer pursuant to Section 3.08(b).
Servicer Custodial Account Reinvestment Income: For each
Distribution Date, all income and gains net of any losses realized since the
preceding Distribution Date from Permitted Investments of funds in the Servicer
Custodial Account.
Servicer's Certificate: The monthly report required by Section 4.01.
Servicing Advances: All customary, reasonable and necessary "out of
pocket" costs and expenses incurred in the performance by the Servicer of its
servicing obligations, including, but not limited to (i) the preservation,
restoration and protection of a Mortgaged Property, (ii) expenses reimbursable
to the Servicer pursuant to Section 3.14 and any enforcement or judicial
proceedings, including foreclosures, (iii) the management and liquidation of any
REO Property and (iv) compliance with the obligations under Section 3.12.
Servicing Compensation: With respect to each Distribution Date, the
sum of (i) the aggregate Servicing Fee for such Distribution Date subject to
reduction as provided in Section 3.17, (ii) any Ancillary Income, (iii) Excess
Proceeds for the preceding month and (iv) the Servicer Custodial Account
Reinvestment Income for such Distribution Date.
Servicing Criteria: The "servicing criteria" set forth in Item
1122(d) of Regulation AB, as such may be amended from time to time, which as of
the Closing Date are listed on Exhibit Q hereto.
Servicing Fee: With respect to each Mortgage Loan and Distribution
Date, the amount of the fee payable to the Servicer, which shall, for such
Distribution Date, be equal to one-twelfth of the product of the Servicing Fee
Rate with respect to such Mortgage Loan and the Stated Principal Balance of such
Mortgage Loan. Such fee shall be payable monthly, computed on the basis of the
same Stated Principal Balance and period respecting which any related interest
payment on a Mortgage Loan is computed. The Servicer's right to receive the
Servicing Fee is limited to, and payable solely from, the interest portion
(including recoveries with respect to interest from Liquidation Proceeds and
other proceeds, to the extent permitted by Section 3.11) of related Monthly
Payments collected by the Servicer, or as otherwise provided under Section 3.11.
Servicing Fee Rate: With respect to each Mortgage Loan, 0.250% per
annum.
Servicing File: The items pertaining to a particular Mortgage Loan
referred to in Exhibit J hereto, and any additional documents required to be
added to the Servicing File pursuant to the Agreement.
Servicing Function Participant: Any affiliate, third party vendor or
Subservicer engaged by the Servicer or the Trustee that is participating in the
servicing function with respect to the Mortgage Loans, within the meaning of
Item 1122 of Regulation AB.
Servicing Officer: Any officer of the Servicer involved in, or
responsible for, the administration and servicing of the Mortgage Loans whose
name appears on a list of servicing officers furnished to the Trustee by the
Servicer, as such list may from time to time be amended.
Servicing Transfer Costs: All reasonable costs and expenses incurred
by the Trustee in connection with the transfer of servicing from a predecessor
servicer, including, without limitation, any costs or expenses associated with
the complete transfer of all servicing data and the completion, correction or
manipulation of such servicing data as may be required by the Trustee to correct
any errors or insufficiencies in the servicing data or otherwise to enable the
Trustee to service the Mortgage Loans properly and effectively.
Shift Percentage: As to any Distribution Date, the percentage
indicated below:
Distribution Date Occurring In Shift Percentage
---------------------------------------------------------
October 2006 through
September 2009................. 0%
October 2009 through
September 2011................. 45%
October 2011 through
September 2012................. 80%
October 2012 through
September 2013................. 100%
October 2013 and thereafter......
300%
Similar Law: As defined in Section 6.02(e).
Sponsor: Bank of America, National Association.
Stated Principal Balance: As to any Mortgage Loan and date, the
unpaid principal balance of such Mortgage Loan as of the specified Due Date or,
if not specified, as of the Due Date immediately preceding such date as
specified in the amortization schedule at the time relating thereto (before any
adjustment to such amortization schedule by reason of any moratorium or similar
waiver or grace period) after giving effect to any previous partial Principal
Prepayments and Liquidation Proceeds allocable to principal (other than with
respect to any Liquidated Mortgage Loan) and to the payment of principal due on
such Due Date and irrespective of any delinquency in payment by the related
Mortgagor, and after giving effect to any Deficient Valuation.
Stepdown Date: The earlier to occur of (i) the Distribution Date
following the Distribution Date on which the aggregate Class Certificate Balance
of the Senior Certificates is reduced to zero and (ii) the later to occur of (x)
the Distribution Date in October 2009 and (y) the Distribution Date on which the
Senior Enhancement Percentage is greater than or equal to 8.90%.
Subordinate Certificates: The Class M, Class CE and Class R
Certificates.
Subordination Depletion Date: The date on which the aggregate Class
Certificate Balance of the Class M Certificates is reduced to zero.
Subservicer: Any Person with which the Servicer has entered into a
Subservicing Agreement and which satisfies the requirements set forth therein.
Subservicing Agreement: Any subservicing agreement (which, in the
event the Subservicer is an affiliate of the Servicer, need not be in writing)
between the Servicer and any Subservicer relating to servicing and/or
administration of certain Mortgage Loans as provided in Section 3.02.
Substitute Mortgage Loan: A Mortgage Loan substituted for a
Defective Mortgage Loan which must, on the date of such substitution (i) have a
Stated Principal Balance, after deduction of the principal portion of the
Monthly Payment due in the month of substitution, not in excess of, and not more
than 10% less than, the Stated Principal Balance of the Defective Mortgage Loan;
(ii) have a Net Mortgage Interest Rate equal to that of the Defective Mortgage
Loan; (iii) have a Loan-to-Value Ratio not higher than that of the Defective
Mortgage Loan; (iv) have a remaining term to maturity not greater than (and not
more than one year less than) that of the Defective Mortgage Loan; and (v)
comply with each Mortgage Loan representation and warranty set forth in this
Agreement relating to the Defective Mortgage Loan. More than one Substitute
Mortgage Loan may be substituted for a Defective Mortgage Loan if such
Substitute Mortgage Loans meet the foregoing attributes in the aggregate.
Substitution Adjustment Amount: As defined in Section 2.02.
Targeted Overcollateralization Amount: As of any Distribution Date,
(x) prior to the Stepdown Date, 0.50% of the aggregate Stated Principal Balance
of the Mortgage Loans as of the Cut-off Date and (y) on and after the Stepdown
Date, (i) if a Trigger Event has not occurred, the greater of (a) 1.00% of the
aggregate Stated Principal Balance of the Mortgage Loans as of the last day of
the related Collection Period and (b) 0.50% of the aggregate Stated Principal
Balance of the Mortgage Loans as of the Cut-off Date and (ii) if a Trigger Event
has occurred, the Targeted Overcollateralization Amount for the immediately
preceding Distribution Date.
Tax Matters Person: Any person designated as "tax matters person" in
accordance with Section 5.06 and the manner provided under Treasury Regulation
ss. 1.860F-4(d) and Treasury Regulation ss. 301.6231(a)(7)-1.
Total Covered Amount: As defined in the Mortgage Loan Purchase
Agreement.
Treasury Regulations: The final and temporary regulations
promulgated under the Code by the U.S. Department of the Treasury.
Trigger Event: A Trigger Event has occurred on a Distribution Date
if (i) the three-month rolling average of 60+ Day Delinquent Loans (as a
percentage of the Stated Principal Balance of the Mortgage Loans as of the last
day of the related Collection Period) equals or exceeds 50% of the Senior
Enhancement Percentage or (ii) the aggregate amount of Realized Losses on the
Mortgage Loans incurred since the Cut-off Date through the last day of the
related Collection Period (reduced by the aggregate amount of Recoveries
received since the Cut-off Date through the last day of the related Collection
Period) divided by the aggregate Stated Principal Balance of the Mortgage Loans
as of the Cut-off Date exceeds the applicable percentages set forth below with
respect to such Distribution Date:
Distribution Date Occurring In Percentage
------------------------------ ----------------------------------
October 2008 through September 2009 0.15% for the first month, plus an
additional 1/12th of 0.20% for
each month thereafter
October 2009 through September 2010 0.35% for the first month, plus an
additional 1/12th of 0.30% for
each month thereafter
October 2010 through September 2011 0.65% for the first month, plus an
additional 1/12th of 0.25% for
each month thereafter
October 2011 through September 2012 0.90% for the first month, plus an
additional 1/12th of 0.15% for
each month thereafter
October 2012 and thereafter 1.05%
Trust: The trust created by this Agreement.
Trust Estate: The corpus of the Trust created to the extent
described herein, consisting of the Mortgage Loans, such assets as shall from
time to time be identified as deposited in the Servicer Custodial Account, the
Certificate Account or the Cap Carryover Reserve Account, in accordance with
this Agreement, REO Property, the Primary Insurance Policies, any other Required
Insurance Policy, the right to receive any BPP Mortgage Loan Payment.
Trustee: Xxxxx Fargo Bank, N.A., and any successors-in-interest and,
if a successor trustee is appointed hereunder, such successor, as trustee.
Trustee Fee: As to any Distribution Date, an amount equal to
one-twelfth of the Trustee Fee Rate multiplied by the aggregate Stated Principal
Balance of the Mortgage Loans as of the Due Date in the month preceding the
month in which such Distribution Date occurs.
Trustee Fee Rate: With respect to each Mortgage Loan, 0.00325% per
annum.
Uncertificated Accrued Interest: With respect to each REMIC 1
Regular Interest on each Distribution Date, an amount equal to one month's
interest at the related Uncertificated REMIC 1 Pass-Through Rate on the
Uncertificated Principal Balance of such REMIC Regular Interest.
Uncertificated Principal Balance: The amount of any REMIC 1 Regular
Interest outstanding as of any date of determination. As of the Closing Date,
the Uncertificated Balance of each REMIC 1 Regular Interest shall equal the
principal amount set forth in the Preliminary Statement hereto as its initial
uncertificated balance. On each Distribution Date, the Uncertificated Principal
Balance of each REMIC 1 Regular Interest shall be reduced by all distributions
of principal made on such REMIC 1 Regular Interest on such Distribution Date
pursuant to Section 4.08 and, if and to the extent necessary and appropriate,
shall be further reduced on such Distribution Date by Realized Losses as
provided in Section 5.11(b). The Uncertificated Balance of REMIC 1 Regular
Interest LT1ZZ shall be increased by interest deferrals as provided in Section
5.11. The Uncertificated Balance of each REMIC 1 Regular Interest shall never be
less than zero.
Uncertificated REMIC 1 Pass-Through Rate: With respect to REMIC 1
Regular Interest LT1AA, REMIC 1 Regular Interest LT1A1, REMIC 1 Regular Interest
LT1A2, REMIC 1 Regular Interest LT1A3, REMIC 1 Regular Interest LT1A4, REMIC 1
Regular Interest LT1A5, REMIC 1 Regular Interest LT1A6, REMIC 1 Regular Interest
LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1
Regular Interest LT1M4, REMIC 1 Regular Interest LT1M5, REMIC 1 Regular Interest
LT1ZZ and REMIC 1 Regular Interest LT1XX, the weighted average of the Net
Mortgage Interest Rates for the Mortgage Loans, weighted on the basis of the
Stated Principal Balances of the Mortgage Loans as of the first day of the
related Collection Period.
Underwriting Guidelines: The underwriting guidelines of Bank of
America.
Unpaid Realized Loss Amount: For any of the Class M-1, Class M-2,
Class M-3, Class M-4 and Class M-5 Certificates and as to any Distribution Date,
the excess of (x) the aggregate Applied Realized Loss Amounts allocated to such
Class for all prior Distribution Dates over (y) the sum of (a) the aggregate
amount of any Recoveries allocated to such Class and (b) the aggregate Realized
Loss Amortization Amounts with respect to such Class for all prior Distribution
Dates.
U.S. Person: A citizen or resident of the United States, a
corporation or partnership (unless, in the case of a partnership, Treasury
Regulations are adopted that provide otherwise) created or organized in or under
the laws of the United States, any state thereof or the District of Columbia,
including an entity treated as a corporation or partnership for federal income
tax purposes, an estate whose income is subject to United States federal income
tax regardless of its source, or a trust if a court within the United States is
able to exercise primary supervision over the administration of such trust, and
one or more such U.S. Persons have the authority to control all substantial
decisions of such trust (or, to the extent provided in applicable Treasury
Regulations, certain trusts in existence on August 20, 1996 which are eligible
to elect to be treated as U.S. Persons).
Voting Rights: The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. As of any date of
determination, (a) 1% of all Voting Rights shall be allocated to the Holders of
the Class CE Certificates, (b) 1% of all Voting Rights shall be allocated to the
Holder of the Residual Certificate and (c) the remaining Voting Rights shall be
allocated among Holders of the remaining Classes of Certificates in proportion
to the Certificate Balances of their respective Certificates on such date.
Section 1.02 Interest Calculations. All calculations of interest
will be made on a 360-day year consisting of twelve 30-day months. All dollar
amounts calculated hereunder shall be rounded to the nearest xxxxx with one-half
of one xxxxx being rounded down.
Section 1.03 Fiscal Year. The fiscal year of the Trust will be the
calendar year.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01 Conveyance of Mortgage Loans. (a) The Depositor,
concurrently with the execution and delivery hereof, hereby sells, transfers,
assigns, sets over and otherwise conveys to the Trustee on behalf of the Trust
for the benefit of the Certificateholders, without recourse, all the right,
title and interest of the Depositor in and to the Mortgage Loans, including all
interest and principal received on or with respect to the Mortgage Loans (other
than payments of principal and interest due and payable on the Mortgage Loans on
or before the Cut-off Date). The foregoing sale, transfer, assignment and set
over does not and is not intended to result in a creation of an assumption by
the Trustee of any obligation of the Depositor or any other Person in connection
with the Mortgage Loans or any agreement or instrument relating thereto, except
as specifically set forth herein. In addition, the Depositor, concurrently with
the execution and delivery hereof, hereby sells, transfers, assigns, sets over
and otherwise conveys to the Trustee on behalf of the Trust for the benefit of
the Certificateholders, without recourse, the Depositor's rights to receive any
BPP Mortgage Loan Payment. It is agreed and understood by the parties hereto
that it is not intended that any mortgage loan be included in the Trust that is
a "High-Cost Home Loan" as defined in any of (i) the New Jersey Home Ownership
Act effective November 27, 2003, (ii) the New Mexico Home Loan Protection Act
effective January 1, 2004, (iii) the Massachusetts Predatory Home Loan Practices
Act effective November 7, 2004 or (iv) the Indiana Home Loan Practices Act,
effective January 1, 2005.
(b) In connection with such transfer and assignment, the Depositor
shall deliver or cause to be delivered to the Trustee, for the benefit of the
Certificateholders, the following documents or instruments with respect to
each Mortgage Loan so assigned:
(i) the original Mortgage Note, endorsed by manual or facsimile
signature in the following form: "Pay to the order of Xxxxx Fargo Bank,
N.A., as trustee for the holders of the Banc of America Alternative Loan
Trust 2006-7 Mortgage Pass-Through Certificates, Series 2006-7, without
recourse," with all necessary intervening endorsements showing a complete
chain of endorsement from the originator to the Trustee (each such
endorsement being sufficient to transfer all right, title and interest of
the party so endorsing, as noteholder or assignee thereof, in and to that
Mortgage Note);
(ii) except as provided below, the original recorded Mortgage with
evidence of a recording thereon, or if any such Mortgage has not been
returned from the applicable recording office or has been lost, or if such
public recording office retains the original recorded Mortgage, a copy of
such Mortgage certified by the Depositor as being a true and correct copy
of the Mortgage;
(iii) subject to the provisos at the end of this paragraph, a duly
executed Assignment of Mortgage to "Xxxxx Fargo Bank, N.A., as trustee for
the holders of the Banc of America Alternative Loan Trust 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7" (which may be included in a
blanket assignment or assignments), together with, except as provided
below, originals of all interim recorded assignments of such mortgage or a
copy of such interim assignment certified by the Depositor as being a true
and complete copy of the original recorded intervening assignments of
Mortgage (each such assignment, when duly and validly completed, to be in
recordable form and sufficient to effect the assignment of and transfer to
the assignee thereof, under the Mortgage to which the assignment relates);
provided that, if the related Mortgage has not been returned from the
applicable public recording office, such Assignment of Mortgage may
exclude the information to be provided by the recording office; and
provided, further, if the related Mortgage has been recorded in the name
of Mortgage Electronic Registration Systems, Inc. ("MERS") or its
designee, no Assignment of Mortgage in favor of the Trustee will be
required to be prepared or delivered and instead, the Servicer shall take
all actions as are necessary to cause the Trust to be shown as the owner
of the related Mortgage Loan on the records of MERS for purposes of the
system of recording transfers of beneficial ownership of mortgages
maintained by MERS;
(iv) the originals of all assumption, modification, consolidation or
extension agreements, if any, with evidence of recording thereon, if any;
(v) any of (A) the original or duplicate original mortgagee title
insurance policy and all riders thereto, (B) a title search showing no
lien (other than standard exceptions of the type described in Section 2.04
(viii)) on the Mortgaged Property senior to the lien of the Mortgage or
(C) an opinion of counsel of the type customarily rendered in the
applicable jurisdiction in lieu of a title insurance policy;
(vi) the original of any guarantee executed in connection with the
Mortgage Note;
(vii) for each Mortgage Loan, if any, which is secured by a
residential long-term lease, a copy of the lease with evidence of
recording indicated thereon, or, if the lease is in the process of being
recorded, a photocopy of the lease, certified by an officer of the
respective prior owner of such Mortgage Loan or by the applicable title
insurance company, closing/settlement/escrow agent or company or closing
attorney to be a true and correct copy of the lease transmitted for
recordation;
(viii) the original of any security agreement, chattel mortgage or
equivalent document executed in connection with the Mortgage; and
(ix) for each Mortgage Loan secured by Co-op Shares, the originals
of the following documents or instruments:
(A) The stock certificate;
(B) The stock power executed in blank;
(C) The executed proprietary lease;
(D) The executed recognition agreement;
(E) The executed assignment of recognition agreement, if any;
(F) The executed UCC-1 financing statement with evidence of
recording thereon; and
(G) Executed UCC-3 financing statements or other appropriate
UCC financing statements required by state law, evidencing a
complete and unbroken line from the mortgagee to the Trustee with
evidence of recording thereon (or in a form suitable for
recordation);
provided, however, that on the Closing Date, with respect to item (iii), the
Depositor has delivered to the Trustee a copy of such Assignment of Mortgage in
blank and has caused the Servicer to retain the completed Assignment of Mortgage
for recording as described below, unless such Mortgage has been recorded in the
name of MERS or its designee. In addition, if the Depositor is unable to deliver
or cause the delivery of any original Mortgage Note due to the loss of such
original Mortgage Note, the Depositor may deliver a copy of such Mortgage Note,
together with a lost note affidavit, and shall thereby be deemed to have
satisfied the document delivery requirements of this Section 2.01(b).
If in connection with any Mortgage Loans, the Depositor cannot
deliver (A) the Mortgage, (B) all interim recorded assignments, (C) all
assumption, modification, consolidation or extension agreements, if any, or (D)
the lender's title policy, if any, (together with all riders thereto) satisfying
the requirements of clause (ii), (iii), (iv) or (v) above, respectively,
concurrently with the execution and delivery hereof because such document or
documents have not been returned from the applicable public recording office in
the case of clause (ii), (iii) or (iv) above, or because the title policy, if
any, has not been delivered to either the Servicer or the Depositor by the
applicable title insurer in the case of clause (v) above, the Depositor shall
promptly deliver or cause to be delivered to the Trustee or the Custodian on
behalf of the Trustee, in the case of clause (ii), (iii) or (iv) above, such
Mortgage, such interim assignment or such assumption, modification,
consolidation or extension agreement, as the case may be, with evidence of
recording indicated thereon upon receipt thereof from the public recording
office, but in no event shall any such delivery of any such documents or
instruments be made later than one year following the Closing Date, unless, in
the case of clause (ii), (iii) or (iv) above, there has been a continuing delay
at the applicable recording office or, in the case of clause (v), there has been
a continuing delay at the applicable insurer and the Depositor has delivered the
Officer's Certificate to such effect to the Trustee. The Depositor shall forward
or cause to be forwarded to the Trustee (1) from time to time additional
original documents evidencing an assumption or modification of a Mortgage Loan
and (2) any other documents required to be delivered by the Depositor or the
Servicer to the Trustee or the Custodian on the Trustee's behalf. In the event
that the original Mortgage is not delivered and in connection with the payment
in full of the related Mortgage Loan the public recording office requires the
presentation of a "lost instruments affidavit and indemnity" or any equivalent
document, because only a copy of the Mortgage can be delivered with the
instrument of satisfaction or reconveyance, the Servicer shall prepare, execute
and deliver or cause to be prepared, executed and delivered, on behalf of the
Trust, such a document to the public recording office.
As promptly as practicable subsequent to such transfer and
assignment, and in any event, within 30 days thereafter, the Servicer shall
(except for any Mortgage which has been recorded in the name of MERS or its
designee) (I) cause each Assignment of Mortgage to be in proper form for
recording in the appropriate public office for real property records within 30
days of the Closing Date and (II) at the Depositor's expense, 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 the Servicer has not
received the information required to prepare such assignment in recordable form,
the Servicer'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 30 days after the receipt thereof and, no recording of an
Assignment of Mortgage will be required in a state if either (i) the Depositor
furnishes to the Trustee an unqualified Opinion of Counsel reasonably acceptable
to the Trustee to the effect that recordation of such assignment is not
necessary under applicable state law to preserve the Trustee's interest in the
related Mortgage Loan against the claim of any subsequent transferee of such
Mortgage Loan or any successor to, or creditor of, the Depositor or the
originator of such Mortgage Loan or (ii) the recordation of an Assignment of
Mortgage in such state is not required by either Rating Agency in order to
obtain the initial ratings on the Certificates on the Closing Date. Set forth on
Exhibit L attached hereto is a list of all states where recordation is required
by either Rating Agency to obtain the initial ratings of the Certificates. The
Trustee may rely and shall be protected in relying upon the information
contained in such Exhibit L.
In the case of Mortgage Loans that have been prepaid in full as of
the Closing Date, the Depositor, in lieu of delivering the above documents to
the Trustee, or the Custodian on the Trustee's behalf, will cause the Servicer
to deposit in the Servicer Custodial Account the portion of such payment that is
required to be deposited in the Servicer Custodial Account pursuant to Section
3.08.
Section 2.02 Acceptance by the Trustee of the Mortgage Loans.
Subject to the provisions of the following paragraph, the Trustee declares that
it, or the Custodian as its agent, will hold the documents referred to in
Section 2.01 and the other documents delivered to it constituting the Mortgage
Files, and that it will hold such other assets as are included in the Trust
Estate, in trust for the exclusive use and benefit of all present and future
Certificateholders. Upon execution and delivery of this document, the Trustee
shall deliver or cause the Custodian to deliver to the Depositor, the Trustee
and the Servicer a certification in the form of Exhibit M hereto (the "Initial
Certification") to the effect that, except as may be specified in a list of
exceptions attached thereto, it has received the original Mortgage Note relating
to each of the Mortgage Loans listed on the Mortgage Loan Schedule.
Within 90 days after the execution and delivery of this Agreement,
the Trustee shall review, or cause the Custodian to review, the Mortgage Files
in its possession, and shall deliver to the Depositor, the Trustee and the
Servicer a certification in the form of Exhibit N hereto (the "Final
Certification") to the effect that, as to each Mortgage Loan listed in the
Mortgage Loan Schedule, except as may be specified in a list of exceptions
attached to such Final Certification, such Mortgage File contains all of the
items required to be delivered pursuant to Section 2.01(b).
If, in the course of such review, the Trustee or the Custodian finds
any document constituting a part of a Mortgage File which does not meet the
requirements of Section 2.01 or is omitted from such Mortgage File, the Trustee
shall promptly so notify the Servicer and the Depositor, or shall cause the
Custodian to promptly so notify the Servicer and the Depositor. In performing
any such review, the Trustee or the Custodian may conclusively rely on the
purported genuineness of any such document and any signature thereon. It is
understood that the scope of the Trustee's or the Custodian's review of the
Mortgage Files is limited solely to confirming that the documents listed in
Section 2.01 have been received and further confirming that any and all
documents delivered pursuant to Section 2.01 appear on their face to have been
executed and relate to the Mortgage Loans identified in the Mortgage Loan
Schedule based solely upon the review of items (i) and (xi) in the definition of
Mortgage Loan Schedule. Neither the Trustee nor the Custodian shall have any
responsibility for determining whether any document is valid and binding,
whether the text of any assignment or endorsement is in proper or recordable
form, whether any document has been recorded in accordance with the requirements
of any applicable jurisdiction, or whether a blanket assignment is permitted in
any applicable jurisdiction. The Depositor hereby covenants and agrees that it
will promptly correct or cure such defect within 90 days from the date it was so
notified of such defect and, if the Depositor does not correct or cure such
defect within such period, the Depositor will either (a) substitute for the
related Mortgage Loan a Substitute Mortgage Loan, which substitution shall be
accomplished in the manner and subject to the conditions set forth below or (b)
purchase such Mortgage Loan from the Trustee at the Repurchase Price for such
Mortgage Loan; provided, however, that in no event shall such a substitution
occur more than two years from the Closing Date; provided, further, that such
substitution or repurchase shall occur within 90 days of when such defect was
discovered if such defect will cause the Mortgage Loan not to be a "qualified
mortgage" within the meaning of Section 860G(a)(3) of the Code.
With respect to each Substitute Mortgage Loan the Depositor shall
deliver to the Trustee, for the benefit of the Certificateholders, the Mortgage
Note, the Mortgage, the related Assignment of Mortgage (except for any Mortgage
which has been recorded in the name of MERS or its designee), and such other
documents and agreements as are otherwise required by Section 2.01, with the
Mortgage Note endorsed and the Mortgage assigned as required by Section 2.01. No
substitution is permitted to be made in any calendar month after the
Determination Date for such month. Monthly Payments due with respect to any such
Substitute Mortgage Loan in the month of substitution shall not be part of the
Trust Estate and will be retained by the Depositor. For the month of
substitution, distributions to Certificateholders will include the Monthly
Payment due for such month on any Defective Mortgage Loan for which the
Depositor has substituted a Substitute Mortgage Loan.
The Servicer shall amend the Mortgage Loan Schedule for the benefit
of the Certificateholders to reflect the removal of each Mortgage Loan that has
become a Defective Mortgage Loan and the substitution of the Substitute Mortgage
Loan or Loans and the Servicer shall deliver the amended Mortgage Loan Schedule
to the Trustee and the Custodian. Upon such substitution, each Substitute
Mortgage Loan shall be subject to the terms of this Agreement in all respects,
and the Depositor shall be deemed to have made to the Trustee with respect to
such Substitute Mortgage Loan, as of the date of substitution, the
representations and warranties made pursuant to Section 2.04. Upon any such
substitution and the deposit to the Servicer Custodial Account of any required
Substitution Adjustment Amount (as described in the next paragraph) and receipt
of a Request for Release, the Trustee shall release, or shall direct the
Custodian to release, the Mortgage File relating to such Defective Mortgage Loan
to the Depositor and shall execute and deliver at the Depositor's direction such
instruments of transfer or assignment prepared by the Depositor, in each case
without recourse, as shall be necessary to vest title in the Depositor, or its
designee, to the Trustee's interest in any Defective Mortgage Loan substituted
for pursuant to this Section 2.02.
For any month in which the Depositor substitutes one or more
Substitute Mortgage Loans for one or more Defective Mortgage Loans, the amount
(if any) by which the aggregate principal balance of all such Substitute
Mortgage Loans as of the date of substitution is less than the aggregate Stated
Principal Balance of all such Defective Mortgage Loans (after application of the
principal portion of the Monthly Payments due in the month of substitution) (the
"Substitution Adjustment Amount") plus an amount equal to the aggregate of any
unreimbursed Advances with respect to such Defective Mortgage Loans shall be
deposited into the Servicer Custodial Account by the Depositor on or before the
Remittance Date for the Distribution Date in the month succeeding the calendar
month during which the related Mortgage Loan is required to be purchased or
replaced hereunder.
The Trustee shall retain or shall cause the Custodian to retain
possession and custody of each Mortgage File in accordance with and subject to
the terms and conditions set forth herein. The Servicer shall promptly deliver
to the Trustee, upon the execution or, in the case of documents requiring
recording, receipt thereof, the originals of such other documents or instruments
constituting the Mortgage File as come into the Servicer's possession from time
to time.
It is understood and agreed that the obligation of the Depositor to
substitute for or to purchase 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 and any Certificateholder against the Depositor.
The Trustee or the Custodian, on behalf of the Trustee, shall be
under no duty or obligation (i) to inspect, review or examine any such
documents, instruments, certificates or other papers to determine that they are
genuine, enforceable, or appropriate for the represented purpose or that they
are other than what they purport to be on their face or (ii) to determine
whether any Mortgage File should include any of the documents specified in
Section 2.01(b)(iv), (vi), (vii), (viii) and (ix). In connection with making the
certifications required hereunder, to the extent a title search or opinion of
counsel has been provided in lieu of a title policy for any Mortgage Loan, the
Trustee shall only be responsible for confirming that a title search or opinion
of counsel has been provided for such Mortgage Loan and shall not be deemed to
have certified that the content of such title search or opinion of counsel is
sufficient to meet the requirements of Section 2.01(b)(v).
Section 2.03 Representations and Warranties of the Servicer. The
Servicer hereby makes the following representations and warranties to the
Depositor and the Trustee, as of the Closing Date:
(i) The Servicer is a national banking association duly organized,
validly existing, and in good standing under the federal laws of the
United States of America and has all licenses necessary to carry on its
business as now being conducted and is licensed, qualified and in good
standing in each of the states where a Mortgaged Property is located if
the laws of such state require licensing or qualification in order to
conduct business of the type conducted by the Servicer. The Servicer has
power and authority to execute and deliver this Agreement and to perform
in accordance herewith; the execution, delivery and performance of this
Agreement (including all instruments of transfer to be delivered pursuant
to this Agreement) by the Servicer and the consummation of the
transactions contemplated hereby have been duly and validly authorized.
This Agreement, assuming due authorization, execution and delivery by the
other parties hereto, evidences the valid, binding and enforceable
obligation of the Servicer, subject to applicable law except as
enforceability may be limited by (A) bankruptcy, insolvency, liquidation,
receivership, moratorium, reorganization or other similar laws affecting
the enforcement of creditors' rights generally or creditors of national
banks and (B) general principles of equity, whether enforcement is sought
in a proceeding in equity or at law. All requisite corporate action has
been taken by the Servicer to make this Agreement valid and binding upon
the Servicer in accordance with its terms.
(ii) No consent, approval, authorization or order is required for
the transactions contemplated by this Agreement from any court,
governmental agency or body, or federal or state regulatory authority
having jurisdiction over the Servicer is required or, if required, such
consent, approval, authorization or order has been or will, prior to the
Closing Date, be obtained.
(iii) The consummation of the transactions contemplated by this
Agreement are in the ordinary course of business of the Servicer and will
not result in the breach of any term or provision of the charter or
by-laws of the Servicer or result in the breach of any term or provision
of, or conflict with or constitute a default under or result in the
acceleration of any obligation under, any agreement, indenture or loan or
credit agreement or other instrument to which the Servicer or its property
is subject, or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Servicer or its property is
subject.
(iv) There is no action, suit, proceeding or investigation pending
or, to the best knowledge of the Servicer, threatened against the Servicer
which, either individually or in the aggregate, would result in any
material adverse change in the business, operations, financial condition,
properties or assets of the Servicer, or in any material impairment of the
right or ability of the Servicer to carry on its business substantially as
now conducted or which would draw into question the validity of this
Agreement or the Mortgage Loans or of any action taken or to be taken in
connection with the obligations of the Servicer contemplated herein, or
which would materially impair the ability of the Servicer to perform under
the terms of this Agreement.
The representations and warranties made pursuant to this Section
2.03 shall survive delivery of the respective Mortgage Files to the Trustee for
the benefit of the Certificateholders. Upon discovery by any of the Depositor,
the Servicer or the Trustee of a breach of any of the representations or
warranties set forth in this Section 2.03, the party discovering such breach
shall give prompt written notice to the other parties.
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 or each Mortgage Loan, as the case may be, as
of the date hereof or such other date set forth herein that as of the Closing
Date:
(i) The information set forth in the Mortgage Loan Schedule is true
and correct in all material respects.
(ii) There are no delinquent taxes, ground rents, governmental
assessments, insurance premiums, leasehold payments, including assessments
payable in future installments or other outstanding charges affecting the
lien priority of the related Mortgaged Property.
(iii) The terms of the Mortgage Note and the Mortgage have not been
impaired, waived, altered or modified in any respect, except by written
instruments, recorded in the applicable public recording office if
necessary to maintain the lien priority of the Mortgage, and which have
been delivered to the Trustee; the substance of any such waiver,
alteration or modification has been approved by the insurer under the
Primary Insurance Policy, if any, the title insurer, to the extent
required by the related policy, and is reflected on the Mortgage Loan
Schedule. No instrument of waiver, alteration or modification has been
executed, and no Mortgagor has been released, in whole or in part, except
in connection with an assumption agreement approved by the insurer under
the Primary Insurance Policy, if any, the title insurer, to the extent
required by the policy, and which assumption agreement has been delivered
to the Trustee.
(iv) The Mortgage Note and the Mortgage are not subject to any right
of rescission, set-off, counterclaim or defense, including the defense of
usury, nor will the operation of any of the terms of the Mortgage Note and
the Mortgage, or the exercise of any right thereunder, render either the
Mortgage Note or the 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.
(v) All buildings upon the Mortgaged Property are insured by an
insurer generally acceptable to prudent mortgage lending institutions
against loss by fire, hazards of extended coverage and such other hazards
as are customary in the area the Mortgaged Property is located, pursuant
to insurance policies conforming to the requirements of Customary
Servicing Procedures and this Agreement. All such insurance policies
contain a standard mortgagee clause naming the originator of the Mortgage
Loan, its successors and assigns as mortgagee and all premiums thereon
have been paid. If the Mortgaged Property is in an area identified on a
flood hazard map or flood insurance rate map issued by the Federal
Emergency Management Agency as having special flood hazards (and such
flood insurance has been made available), a flood insurance policy meeting
the requirements of the current guidelines of the Federal Insurance
Administration is in effect which policy conforms to the requirements of
Xxxxxx Xxx or Xxxxxxx Mac. 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 Mortgagor's cost and expense and to seek
reimbursement therefor from the Mortgagor.
(vi) Any and all requirements of any federal, state or local law
including, without limitation, usury, truth in lending, real estate
settlement procedures, consumer credit protections, all applicable
predatory and abusive lending laws, equal credit opportunity or disclosure
laws applicable to the origination and servicing of Mortgage Loan have
been complied with.
(vii) The Mortgage has not been satisfied, canceled, subordinated or
rescinded, in whole or in part (other than as to Principal Prepayments in
full which may have been received prior to the Closing Date), and the
Mortgaged Property has not been released from the lien of the Mortgage, in
whole or in part, nor has any instrument been executed that would effect
any such satisfaction, cancellation, subordination, rescission or release.
(viii) The Mortgage is a valid, existing and enforceable first lien
on the Mortgaged Property, including all improvements on the Mortgaged
Property subject only to (A) the lien of current real property taxes and
assessments not yet due and payable, (B) covenants, conditions and
restrictions, rights of way, easements and other matters of the public
record as of the date of recording being acceptable to mortgage lending
institutions generally and specifically referred to in the lender's title
insurance policy delivered to the originator of the Mortgage Loan and
which do not adversely affect the Appraised Value of the Mortgaged
Property, (C) if the Mortgaged Property consists of Co-op Shares, any lien
for amounts due to the cooperative housing corporation for unpaid
assessments or charges or any lien of any assignment of rents or
maintenance expenses secured by the real property owned by the cooperative
housing corporation, and (D) 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, existing and enforceable first lien and first priority security
interest on the property described therein and the Depositor has the full
right to sell and assign the same to the Trustee.
(ix) The Mortgage Note and the related Mortgage are genuine and each
is the legal, valid and binding obligation of the maker thereof,
enforceable in accordance with its terms except as enforceability may be
limited by (A) bankruptcy, insolvency, liquidation, receivership,
moratorium, reorganization or other similar laws affecting the enforcement
of the rights of creditors and (B) general principles of equity, whether
enforcement is sought in a proceeding in equity or at law.
(x) All parties to the Mortgage Note and the Mortgage had legal
capacity to enter into the Mortgage Loan and to execute and deliver the
Mortgage Note and the Mortgage, and the Mortgage Note and the Mortgage
have been duly and properly executed by such parties.
(xi) The proceeds of the Mortgage Loan have been fully disbursed to
or for the account of the Mortgagor and there is no obligation for the
Mortgagee to advance additional funds thereunder and any and all
requirements as to completion of any on-site or off-site improvements and
as to disbursements of any escrow funds therefor have been complied with.
All costs, fees and expenses incurred in making or closing the Mortgage
Loan and the recording of the Mortgage have been paid, and the Mortgagor
is not entitled to any refund of any amounts paid or due to the Mortgagee
pursuant to the Mortgage Note or Mortgage.
(xii) To the best of the Depositor's knowledge, all parties which
have had any interest in the Mortgage Loan, whether as mortgagee,
assignee, pledgee or otherwise, are (or, during the period in which they
held and disposed of such interest, were) in compliance with any and all
applicable "doing business" and licensing requirements of the laws of the
state wherein the Mortgaged Property is located.
(xiii) (A) The Mortgage Loan is covered by an ALTA lender's title
insurance policy, acceptable to Xxxxxx Xxx or Xxxxxxx Mac, issued by a
title insurer acceptable to Xxxxxx Mae or Xxxxxxx Mac and qualified to do
business in the jurisdiction where the Mortgaged Property is located,
insuring (subject to the exceptions contained in (viii)(A) and (B) above)
the Seller, its successors and assigns as to the first priority lien of
the Mortgage in the original principal amount of the Mortgage Loan, (B) a
title search has been done showing no lien (other than the exceptions
contained in (viii)(A) and (B) above) on the related Mortgaged Property
senior to the lien of the Mortgage or (C) in the case of any Mortgage Loan
secured by a Mortgaged Property located in a jurisdiction where such
policies are generally not available, an opinion of counsel of the type
customarily rendered in such jurisdiction in lieu of title insurance is
instead received. For each Mortgage Loan covered by a title insurance
policy (x) the Depositor is the sole insured of such lender's title
insurance policy, and such lender's title insurance policy is in full
force and effect and will be in full force and effect upon the
consummation of the transactions contemplated by this Agreement and (y) no
claims have been made under such lender's title insurance policy, and the
Depositor has not done, by act or omission, anything which would impair
the coverage of such lender's title insurance policy.
(xiv) There is no default, breach, violation or event of
acceleration existing under the Mortgage or the Mortgage Note and no event
which, with the passage of time or with notice and the expiration of any
grace or cure period, would constitute a default, breach, violation or
event of acceleration, and the Seller has not waived any default, breach,
violation or event of acceleration.
(xv) As of the date of origination of the Mortgage Loan, there had
been no mechanics' or similar liens or claims filed for work, labor or
material (and no rights are outstanding that under law could give rise to
such lien) affecting the related Mortgaged Property which are or may be
liens prior to, or equal or coordinate with, the lien of the related
Mortgage.
(xvi) All improvements which were considered in determining the
Appraised Value of the related Mortgaged Property lay wholly within the
boundaries and building restriction lines of the Mortgaged Property, and
no improvements on adjoining properties encroach upon the Mortgaged
Property.
(xvii) The Mortgage Loan was originated by a savings and loan
association, savings bank, commercial bank, credit union, insurance
company, or similar institution which is supervised and examined by a
federal or state authority, or by a mortgagee approved by the Secretary of
Housing and Urban Development pursuant to sections 203 and 211 of the
National Housing Act.
(xviii) Principal payments on the Mortgage Loan commenced no more
than sixty days after the proceeds of the Mortgaged Loan were disbursed.
The Mortgage Loans are 20 to 30-year fixed rate mortgage loans having an
original term to maturity of not more than 30 years, with interest payable
in arrears on the first day of the month. Each Mortgage Note requires a
monthly payment which is sufficient to fully amortize the original
principal balance over the original term thereof and to pay interest at
the related Mortgage Interest Rate. The Mortgage Note does not permit
negative amortization.
(xix) There is no proceeding pending or, to the Depositor's
knowledge, threatened for the total or partial condemnation of the
Mortgaged Property. The Mortgaged Property is in good repair and is
undamaged by waste, fire, earthquake or earth movement, windstorm, flood,
tornado or other casualty, so as to affect adversely the value of the
Mortgaged Property as security for the Mortgage Loan or the use for which
the premises were intended.
(xx) The Mortgage and related Mortgage Note contain customary and
enforceable provisions such as to render the rights and remedies of the
holder thereof adequate for the realization against the Mortgaged Property
of the benefits of the security provided thereby, including (A) in the
case of a Mortgage designated as a deed of trust, by trustee's sale, and
(B) otherwise by judicial foreclosure. To the best of the Depositor's
knowledge, following the date of origination of the Mortgage Loan, the
Mortgaged Property has not been subject to any bankruptcy proceeding or
foreclosure proceeding and the Mortgagor has not filed for protection
under applicable bankruptcy laws. There is no homestead or other exemption
or right available to the Mortgagor or any other person which would
interfere with the right to sell the Mortgaged Property at a trustee's
sale or the right to foreclose the Mortgage.
(xxi) Other than any Borrowers Protection Plan(R) addendum to the
Mortgage Note of a BPP Mortgage Loan, the Mortgage Note and Mortgage are
on forms acceptable to Xxxxxx Xxx or Xxxxxxx Mac.
(xxii) The Mortgage Note is not and has not been secured by any
collateral except the lien of the corresponding Mortgage on the Mortgaged
Property and the security interest of any applicable security agreement or
chattel mortgage referred to in (viii) above.
(xxiii) Each appraisal of the related Mortgaged Property, is in a
form acceptable to Xxxxxx Mae or Xxxxxxx Mac and such appraisal complies
with the requirements of FIRREA, and was made and signed, prior to the
approval of the Mortgage Loan application, by a Qualified Appraiser.
(xxiv) In the event the Mortgage constitutes a deed of trust, a
trustee, duly qualified under applicable law to serve as such, has been
properly designated and currently so serves, and no fees or expenses are
or will become payable by the Trustee to the trustee under the deed of
trust, except in connection with a trustee's sale after default by the
Mortgagor.
(xxv) No Mortgage Loan is a graduated payment mortgage loan, no
Mortgage Loan has a shared appreciation or other contingent interest
feature, and no Mortgage Loan contains any "buy-down" feature.
(xxvi) The Mortgagor has received all disclosure materials required
by applicable law with respect to the making of mortgage loans of the same
type as the Mortgage Loan and rescission materials required by applicable
law if the Mortgage Loan is a Refinance Mortgage Loan.
(xxvii) Each Primary Insurance Policy to which any Mortgage Loan is
subject will be issued by an insurer acceptable to Xxxxxx Mae or Xxxxxxx
Mac, which insures that portion of the Mortgage Loan in excess of the
portion of the Appraised Value of the Mortgaged Property required by
Xxxxxx Mae. All provisions of such Primary Insurance Policy have been and
are being complied with, such policy is in full force and effect, and all
premiums due thereunder have been paid. Any Mortgage subject to any such
Primary Insurance Policy obligates the Mortgagor thereunder to maintain
such insurance and to pay all premiums and charges in connection therewith
at least until Loan-to-Value Ratio of such Mortgage Loan is reduced to
less than 80%. The Mortgage Interest Rate for the Mortgage Loan does not
include any such insurance premium.
(xxviii) To the best of the Depositor's knowledge as of the date of
origination of the Mortgage Loan, (A) the Mortgaged Property is lawfully
occupied under applicable law, (B) all inspections, licenses and
certificates required to be made or issued with respect to all occupied
portions of the Mortgaged Property and, with respect to the use and
occupancy of the same, including but not limited to certificates of
occupancy, have been made or obtained from the appropriate authorities and
(C) no improvement located on or part of the Mortgaged Property is in
violation of any zoning law or regulation.
(xxix) The Assignment of Mortgage (except with respect to any
Mortgage that has been recorded in the name of MERS or its designee) is in
recordable form and is acceptable for recording under the laws of the
jurisdiction in which the Mortgaged Property is located.
(xxx) All payments required to be made prior to the Cut-off Date for
such Mortgage Loan under the terms of the Mortgage Note have been made and
no more than 0.20% (by Cut-off Date Principal Balance) of the Mortgage
Loan have been more than 30 days delinquent more than once in the twelve
month period immediately prior to the Cut-off Date.
(xxxi) With respect to each Mortgage Loan, the Depositor or Servicer
is in possession of a complete Mortgage File except for the documents
which have been delivered to the Trustee or which have been submitted for
recording and not yet returned.
(xxxii) Immediately prior to the transfer and assignment
contemplated herein, the Depositor was the sole owner and holder of the
Mortgage Loans. The Mortgage Loans were not assigned or pledged by the
Depositor and the Depositor had good and marketable title thereto, and the
Depositor had full right to transfer and sell the Mortgage Loans to the
Trustee free and clear of any encumbrance, participation interest, lien,
equity, pledge, claim or security interest and had full right and
authority subject to no interest or participation in, or agreement with
any other party to sell or otherwise transfer the Mortgage Loans.
(xxxiii) Any future advances made prior to the Cut-off Date have
been consolidated with the outstanding principal amount secured by the
Mortgage, and the secured principal amount, as consolidated, bears a
single interest rate and single repayment term. The lien of the Mortgage
securing the consolidated principal amount is expressly insured as having
first lien priority by a title insurance policy, an endorsement to the
policy insuring the mortgagee's consolidated interest or by other title
evidence acceptable to Xxxxxx Xxx and Xxxxxxx Mac. The consolidated
principal amount does not exceed the original principal amount of the
Mortgage Loan.
(xxxiv) The Mortgage Loan was underwritten in accordance with the
applicable Underwriting Guidelines in effect at the time of origination
with exceptions thereto exercised in a reasonable manner.
(xxxv) If the Mortgage Loan is secured by a long-term residential
lease, (1) the lessor under the lease holds a fee simple interest in the
land; (2) the terms of such lease expressly permit the mortgaging of the
leasehold estate, the assignment of the lease without the lessor's consent
and the acquisition by the holder of the Mortgage of the rights of the
lessee upon foreclosure or assignment in lieu of foreclosure or provide
the holder of the Mortgage with substantially similar protections; (3) the
terms of such lease do not (a) allow the termination thereof upon the
lessee's default without the holder of the Mortgage being entitled to
receive written notice of, and opportunity to cure, such default, (b)
allow the termination of the lease in the event of damage or destruction
as long as the Mortgage is in existence, (c) prohibit the holder of the
Mortgage from being insured (or receiving proceeds of insurance) under the
hazard insurance policy or policies relating to the Mortgaged Property or
(d) permit any increase in the rent other than pre-established increases
set forth in the lease; (4) the original term of such lease is not less
than 15 years; (5) the term of such lease does not terminate earlier than
five years after the maturity date of the Mortgage Note; and (6) the
Mortgaged Property is located in a jurisdiction in which the use of
leasehold estates in transferring ownership in residential properties is a
widely accepted practice.
(xxxvi) No more than 0.25% (by Cut-off Date Principal Balance) of
the Mortgage Loans are secured by long-term residential leases.
(xxxvii) The Mortgaged Property is located in the state identified
in the Mortgage Loan Schedule and consists of a parcel of real property
with a detached single family residence erected thereon, or a two- to
four-family dwelling, or an individual condominium unit, or an individual
unit in a planned unit development, or, in the case of Mortgage Loans
secured by Co-op Shares, leases or occupancy agreements; provided,
however, that any condominium project or planned unit development
generally conforms with the applicable Underwriting Guidelines regarding
such dwellings, and no residence or dwelling is a mobile home or a
manufactured dwelling.
(xxxviii) The Depositor used no adverse selection procedures in
selecting the Mortgage Loan for inclusion in the Trust Estate.
(xxxix) Each Mortgage Loan is a "qualified mortgage" within the
meaning of Section 860G(a)(3) of the Code.
(xl) With respect to each Mortgage where a lost note affidavit has
been delivered to the Trustee in place of the related Mortgage Note, the
related Mortgage Note is no longer in existence.
(xli) No Mortgage Loan is a "high cost" loan as defined under any
federal, state or local law applicable to such Mortgage Loan at the time
of its origination.
(xlii) No Mortgage Loan is a High Cost Loan or Covered Loan, as
applicable (as such terms are defined in the then-current S&P's LEVELS(R)
Glossary which is now Version 5.7, Appendix E) and no Mortgage Loan
originated on or after October 1, 2002 through March 6, 2003 is governed
by the Georgia Fair Lending Act.
(xliii) No Mortgage Loan is subject to the provisions of the Home
Ownership and Equity Protection Act of 1994, as amended.
Notwithstanding the foregoing, no representations or warranties are
made by the Depositor as to the environmental condition of any Mortgaged
Property; the absence, presence or effect of hazardous wastes or hazardous
substances on any Mortgaged Property; any casualty resulting from the presence
or effect of hazardous wastes or hazardous substances on, near or emanating from
any Mortgaged Property; the impact on Certificateholders of any environmental
condition or presence of any hazardous substance on or near any Mortgaged
Property; or the compliance of any Mortgaged Property with any environmental
laws, nor is any agent, Person or entity otherwise affiliated with the Depositor
authorized or able to make any such representation, warranty or assumption of
liability relative to any Mortgaged Property. In addition, no representations or
warranties are made by the Depositor with respect to the absence or effect of
fraud in the origination of any Mortgage Loan.
It is understood and agreed that the representations and warranties
set forth in this Section 2.04 shall survive delivery of the respective Mortgage
Files to the Trustee or the Custodian and shall inure to the benefit of the
Trustee, notwithstanding any restrictive or qualified endorsement or assignment.
Upon discovery by any of the Depositor, the Servicer, the Trustee or
the Custodian that any of the representations and warranties set forth in this
Section 2.04 is not accurate (referred to herein as a "breach") and that such
breach materially and adversely affects the interests of the Certificateholders
in the related Mortgage Loan, the party discovering such breach shall give
prompt written notice to the other parties (any Custodian being so obligated
under a custodial agreement); provided that any such breach that causes the
Mortgage Loan not to be a "qualified mortgage" within the meaning of Section
860G(a)(3) of the Code shall be deemed to materially and adversely affect the
interests of the Certificateholders. Within 90 days of its discovery or its
receipt of notice of any such breach, the Depositor shall cure such breach in
all material respects or shall either (i) repurchase the Mortgage Loan or any
property acquired in respect thereof from the Trustee at a price equal to the
Repurchase Price or (ii) if within two years of the Closing Date, substitute for
such Mortgage Loan in the manner described in Section 2.02; provided that if the
breach would cause the Mortgage Loan to be other than a "qualified mortgage" as
defined in Section 860G(a)(3) of the Code, any such repurchase or substitution
must occur within 90 days from the date the breach was discovered. In addition
to the foregoing, if a breach of the representation set forth in clause (vi) or
(xlii) of this Section 2.04 occurs as a result of a violation of an applicable
predatory or abusive lending law, the Depositor shall reimburse the Trust for
all costs or damages incurred by the Trust as a result of the violation of such
law (such amount, the "Reimbursement Amount"). The Repurchase Price of any
repurchase described in this paragraph, the Substitution Adjustment Amount, if
any, and any Reimbursement Amount shall be deposited in the Servicer Custodial
Account. It is understood and agreed that, except with respect to the second
preceding sentence, the obligation of the Depositor to repurchase or substitute
for any Mortgage Loan or Mortgaged Property as to which such a breach has
occurred and is continuing shall constitute the sole remedy respecting such
breach available to Certificateholders, or to the Trustee on behalf of
Certificateholders, and such obligation shall survive until termination of the
Trust hereunder.
Section 2.05 Designation of Interests in the REMICs. The Trustee
acknowledges the issuance of the uncertificated REMIC 1 Regular Interests and
declares that it holds such regular interests as assets of REMIC 2. The Trustee
acknowledges the obligation of the Class CE Certificates to pay Cap Carryover
Amounts, and declares that it shall hold the same as assets of the Grantor Trust
on behalf of the Holders of the Class A-1, Class A-2, Class A-3, Class A-4,
Class X-0, Xxxxx X-0, Class M-1, Class M-2, Class M-3, Class M-4 and Class M-5
Certificates, which shall be treated as beneficially owning the right to receive
the Cap Carryover Amounts from the Grantor Trust. In addition to the assets
described in the preceding sentence, the assets of the Grantor Trust shall also
include the Cap Carryover Reserve Account and the beneficial interest of the
Class CE Certificates with respect thereto, subject to the obligation to pay Cap
Carryover Amounts. The interests evidenced by the Certificates constitute the
entire beneficial ownership interest in the Trust.
Section 2.06 Designation of Start-up Day. The Closing Date is hereby
designated as the "start-up day" of each of the REMICs within the meaning of
Section 860G(a)(9) of the Code.
Section 2.07 REMIC Certificate Maturity Date. Solely for purposes of
satisfying Section 1.860G-1(a)(4)(iii) of the Treasury Regulations, the "latest
possible maturity date" of the regular interests in the REMIC is October 25,
2036.
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
Section 3.01 Servicer to Service Mortgage Loans. For and on behalf
of the Certificateholders, the Servicer shall service and administer the
Mortgage Loans, all in accordance with the terms of this Agreement, Customary
Servicing Procedures, applicable law and the terms of the Mortgage Notes and
Mortgages. In connection with such servicing and administration, the Servicer
shall have full power and authority, acting alone and/or through Subservicers as
provided in Section 3.02, 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, (a) to execute and deliver, on behalf of the
Certificateholders and the Trustee, customary consents or waivers and other
instruments and documents, (b) to consent, with respect to the Mortgage Loans it
services, to transfers of any Mortgaged Property and assumptions of the Mortgage
Notes and related Mortgages (but only in the manner provided in this Agreement),
(c) to collect any Insurance Proceeds and other Liquidation Proceeds relating to
the Mortgage Loans it services, and (d) to effectuate foreclosure or other
conversion of the ownership of the Mortgaged Property securing any Mortgage Loan
it services. The Servicer shall represent and protect the interests of the Trust
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 term of
any Mortgage Loan, except as provided pursuant to Section 3.21. Without limiting
the generality of the foregoing, the Servicer, in its own name or in the name of
any Subservicer or the Depositor and the Trustee, is hereby authorized and
empowered by the Depositor and the Trustee, when the Servicer or any
Subservicer, as the case may be, believes it appropriate in its reasonable
judgment, to execute and deliver, on behalf of the Trustee, the Depositor, the
Certificateholders or any of them, any and all instruments or agreements of
satisfaction, cancellation, default, assumption, modification, discharge,
partial or full release, and all other comparable instruments and agreements,
with respect to the Mortgage Loans it services, and with respect to the related
Mortgaged Properties held for the benefit of the Certificateholders. To the
extent that the Servicer is not permitted to execute and deliver such documents
pursuant to the preceding sentence, the Servicer shall prepare and deliver to
the Depositor and/or the Trustee such documents requiring execution and delivery
by either or both of them as are necessary or appropriate to enable the Servicer
to service and administer the Mortgage Loans it services. Upon receipt of such
documents, the Depositor and/or the Trustee, upon the direction of the Servicer,
shall promptly execute such documents and deliver them to the Servicer.
Alternatively, upon the request of the Servicer, the Trustee shall execute and
deliver to the Servicer any additional powers of attorney and other documents
prepared by the Servicer that are reasonably necessary or appropriate to enable
the Servicer to carry out its servicing and administrative duties under this
Agreement.
In accordance with the standards of the preceding paragraph, the
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 relating to the Mortgage Loans it services, which Servicing Advances
shall be reimbursable in the first instance from related collections from the
Mortgagors pursuant to Section 3.09, and further as provided in Section 3.11.
The costs incurred by the Servicer, if any, in effecting the timely payments of
taxes and assessments on the Mortgaged Properties and related insurance premiums
shall not, for the purpose of calculating monthly distributions to the
Certificateholders, be added to the Stated Principal Balances of the related
Mortgage Loans, notwithstanding that the terms of such Mortgage Loans so permit.
The relationship of the Servicer (and of any successor to the
Servicer as servicer under this Agreement) to the Trustee under this Agreement
is intended by the parties to be that of an independent contractor and not that
of a joint venturer, partner or agent.
Section 3.02 Subservicing; Enforcement of the Obligations of
Servicer. (a) The Servicer may arrange for the subservicing of any Mortgage Loan
it services by a Subservicer pursuant to a Subservicing Agreement; provided,
however, that such subservicing arrangement and the terms of the related
Subservicing Agreement must provide for the servicing of such Mortgage Loan in a
manner consistent with the servicing arrangements contemplated hereunder.
Notwithstanding the provisions of any Subservicing Agreement, any of the
provisions of this Agreement relating to agreements or arrangements between the
Servicer and a Subservicer or reference to actions taken through a Subservicer
or otherwise, the Servicer shall remain obligated and liable to the Depositor,
the Trustee and the Certificateholders for the servicing and administration of
the Mortgage Loans it services in accordance with the provisions of this
Agreement without diminution of such obligation or liability by virtue of such
Subservicing Agreements or arrangements or by virtue of indemnification from the
Subservicer and to the same extent and under the same terms and conditions as if
the Servicer alone were servicing and administering those Mortgage Loans. All
actions of each Subservicer performed pursuant to the related Subservicing
Agreement shall be performed as agent of the Servicer with the same force and
effect as if performed directly by the Servicer.
(b) For purposes of this Agreement, the Servicer shall be deemed to
have received any collections, recoveries or payments with respect to the
Mortgage Loans it services that are received by a Subservicer regardless of
whether such payments are remitted by the Subservicer to the Servicer.
(c) As part of its servicing activities hereunder, the Servicer, for
the benefit of the Trustee and the Certificateholders, shall use its best
reasonable efforts to enforce the obligations of each Subservicer engaged by
the Servicer under the related Subservicing Agreement, to the extent that the
non-performance of any such obligation would have a material and adverse
effect on a Mortgage Loan. Such enforcement, including, without limitation,
the legal prosecution of claims, termination of Subservicing 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 Servicer, in its good faith
business judgment, would require were it the owner of the related Mortgage
Loans. The Servicer shall pay the costs of such enforcement at its own
expense, and shall be reimbursed therefor only (i) from a general recovery
resulting from such enforcement to the extent, if any, that such recovery
exceeds all amounts due in respect of the related Mortgage Loan or (ii) from
a specific recovery of costs, expenses or attorneys fees against the party
against whom such enforcement is directed.
(d) Any Subservicing Agreement entered into by the Servicer shall
provide that it may be assumed or terminated by the Trustee, if the Trustee
has assumed the duties of the Servicer, or any successor Servicer, at the
Trustee's or successor Servicer's option, as applicable, without cost or
obligation to the assuming or terminating party or the Trust Estate, upon the
assumption by such party of the obligations of the Servicer pursuant to
Section 8.05.
(e) Notwithstanding the foregoing, to the extent the Servicer
engages any affiliate or third party vendor, including any Subservicer, in
connection with the performance of any of its duties under this Agreement,
the Servicer shall immediately notify the Depositor in writing of such
engagement. To the extent the Depositor notifies the Servicer and the Trustee
that it has determined that any such affiliate, third party vendor or
Subservicer is a Servicing Function Participant, the Servicer shall cause
such Servicing Function Participant to prepare a separate assessment and
attestation report, as contemplated by Section 3.19 of this Agreement and
deliver such report to the Trustee as set forth in Section 3.22 of this
Agreement. In addition, to the extent the Depositor notifies the Servicer and
the Trustee that it has determined that any such Servicing Function
Participant would be a "servicer" within the meaning of Item 1101 of
Regulation AB and meets the criteria in Item 1108(a)(2)(i), (ii) or (iii) of
Regulation AB (an "Additional Servicer"), the Servicer shall cause such
Additional Servicer to prepare a separate compliance statement as
contemplated by Section 3.18 of this Agreement and deliver such statement to
the Trustee as set forth in Section 3.22 of this Agreement. In addition, if
the Depositor determines any such Servicing Function Participant would be a
"servicer" within the meaning of Item 1101 of Regulation AB, the Servicer
shall cause such Servicing Function Participant to provide the Depositor and
the Trustee the information required by Section 1108(b) and 1108(c) of
Regulation AB within two Business Days following such engagement. To the
extent the Servicer terminates any such Servicing Function Participant that
the Depositor has determined is a "servicer" within the meaning of Item 1101
of Regulation AB, the Servicer shall provide the Depositor and the Trustee
the information required to enable the Trustee to accurately and timely
report such event under Item 6.02 of Form 8-K (if the Trust's Exchange Act
reporting requirements have not been suspended pursuant to Section 15(d) of
the Exchange Act as set forth in 3.22(g)).
Section 3.03 Fidelity Bond; Errors and Omissions Insurance. The
Servicer shall maintain, 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 Mortgage Loans it
services. These policies must insure the Servicer against losses resulting from
dishonest or fraudulent acts committed by the Servicer's personnel, any
employees of outside firms that provide data processing services for the
Servicer, and temporary contract employees or student interns. Such fidelity
bond shall also protect and insure the Servicer against losses in connection
with the release or satisfaction of a Mortgage Loan without having obtained
payment in full of the indebtedness secured thereby. No provision of this
Section 3.03 requiring such fidelity bond and errors and omissions insurance
shall diminish or relieve the 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 Xxxxxx
Xxx in the Xxxxxx Mae Servicing Guide or by Xxxxxxx Mac in the Xxxxxxx Xxx
Xxxxxxx' & Servicers' Guide, as amended or restated from time to time, or in an
amount as may be permitted to the Servicer by express waiver of Xxxxxx Xxx or
Xxxxxxx Mac.
Section 3.04 Access to Certain Documentation. The Servicer shall
provide to the OCC, the OTS, the FDIC and to comparable regulatory authorities
supervising Holders of Certificates and the examiners and supervisory agents of
the OCC, the OTS, the FDIC and such other authorities, access to the
documentation required by applicable regulations of the OCC, the OTS, the FDIC
and such other authorities with respect to the Mortgage Loans. Such access shall
be afforded upon reasonable and prior written request and during normal business
hours at the offices designated by the Servicer; provided that the Servicer
shall be entitled to be reimbursed by each such Certificateholder for actual
expenses incurred by the Servicer in providing such reports and access. Nothing
in this Section 3.04 shall limit the obligation of the Servicer to observe any
applicable law and the failure of the Servicer to provide access as provided in
this Section 3.04 as a result of such obligation shall not constitute a breach
of this Section 3.04.
Section 3.05 Maintenance of Primary Insurance Policy; Claims;
Collections of BPP Mortgage Loan Payments. (a) With respect to each Mortgage
Loan with a Loan-to-Value Ratio in excess of 80% or such other Loan-to-Value
Ratio as may be required by law that was originated with a Primary Insurance
Policy, the Servicer shall, without any cost to the Trust Estate, maintain or
cause the Mortgagor to maintain in full force and effect a Primary Insurance
Policy insuring that portion of the Mortgage Loan in excess of a percentage in
conformity with Xxxxxx Mae requirements. The Servicer shall pay or shall cause
the Mortgagor to pay the premium thereon on a timely basis, at least until the
Loan-to-Value Ratio of such Mortgage Loan is reduced to 80% or such other
Loan-to-Value Ratio as may be required by law. If such Primary Insurance Policy
is terminated, the Servicer shall obtain from another insurer a comparable
replacement policy, with a total coverage equal to the remaining coverage of
such terminated Primary Insurance Policy. If the insurer shall cease to be an
insurer acceptable to Xxxxxx Xxx or Xxxxxxx Mac, the Servicer shall notify the
Trustee in writing, it being understood that the Servicer shall not have any
responsibility or liability for any failure to recover under the Primary
Insurance Policy for such reason. If the Servicer determines that recoveries
under the Primary Insurance Policy are jeopardized by the financial condition of
the insurer, the Servicer shall obtain from another insurer which meets the
requirements of this Section 3.05 a replacement insurance policy. The Servicer
shall not take any action that would result in noncoverage under any applicable
Primary Insurance Policy of any loss that, but for the actions of the Servicer,
would have been covered thereunder. In connection with any assumption or
substitution agreement entered into or to be entered into pursuant to Section
3.13, the Servicer shall promptly notify the insurer under the related Primary
Insurance Policy, if any, of such assumption or substitution of liability in
accordance with the terms of such Primary Insurance Policy and shall take all
actions which may be required by such insurer as a condition to the continuation
of coverage under such Primary Insurance Policy. If such Primary Insurance
Policy is terminated as a result of such assumption or substitution of
liability, the Servicer shall obtain a replacement Primary Insurance Policy as
provided above.
In connection with its activities as servicer, the Servicer agrees
to prepare and present, on behalf of itself, the Trustee and the
Certificateholders, claims to the insurer under any Primary Insurance Policy in
a timely fashion in accordance with the terms of such Primary Insurance Policy
and, in this regard, to take such action as shall be necessary to permit
recovery under any Primary Insurance Policy respecting a defaulted Mortgage
Loan. Pursuant to Section 3.09(a), any amounts collected by the Servicer under
any Primary Insurance Policy shall be deposited in the related Escrow Account,
subject to withdrawal pursuant to Section 3.09(b).
The Servicer will comply with all provisions of applicable state and
federal law relating to the cancellation of, or collection of premiums with
respect to, Primary Mortgage Insurance, including, but not limited to, the
provisions of the Homeowners Protection Act of 1998, and all regulations
promulgated thereunder, as amended from time to time.
(b) The Servicer shall take all actions necessary to collect, on
behalf of the Trust, any BPP Mortgage Loan Payments required to be made to
the Trust pursuant to the Mortgage Loan Purchase Agreement.
Section 3.06 Rights of the Depositor and the Trustee in Respect of
the Servicer. The Depositor may, but is not obligated to, enforce the
obligations of the Servicer hereunder and may, but is not obligated to, perform,
or cause a designee to perform, any defaulted obligation of the Servicer
hereunder and in connection with any such defaulted obligation to exercise the
related rights of the Servicer hereunder; provided that the Servicer shall not
be relieved of any of its obligations hereunder by virtue of such performance by
the Depositor or its designee. Neither the Trustee nor the Depositor shall have
any responsibility or liability for any action or failure to act by the Servicer
nor shall the Trustee or the Depositor be obligated to supervise the performance
of the Servicer hereunder or otherwise.
Any Subservicing Agreement that may be entered into and any
transactions or services relating to the Mortgage Loans involving a Subservicer
in its capacity as such shall be deemed to be between the Subservicer and the
Servicer alone, and the Trustee and Certificateholders shall not be deemed
parties thereto and shall have no claims, rights, obligations, duties or
liabilities with respect to the Subservicer except as set forth in Section 3.07.
The Servicer shall be solely liable for all fees owed by it to any Subservicer,
irrespective of whether the Servicer's compensation pursuant to this Agreement
is sufficient to pay such fees.
Section 3.07 Trustee to Act as Servicer. If the Servicer shall for
any reason no longer be the Servicer hereunder (including by reason of an Event
of Default), the Trustee shall within 90 days of such time, assume, if it so
elects, or shall appoint a successor Servicer to assume, all of the rights and
obligations of the Servicer hereunder arising thereafter (except that the
Trustee shall not be (a) liable for losses of the Servicer pursuant to Section
3.12 or any acts or omissions of the predecessor Servicer hereunder, (b)
obligated to make Advances if it is prohibited from doing so by applicable law
or (c) deemed to have made any representations and warranties of the Servicer
hereunder). Any such assumption shall be subject to Sections 7.02 and 8.05. If
the Servicer shall for any reason no longer be the Servicer (including by reason
of any Event of Default), the Trustee or the successor Servicer may elect to
succeed to any rights and obligations of the Servicer under each Subservicing
Agreement or may terminate each Subservicing Agreement. If it has elected to
assume the Subservicing Agreement, the Trustee or the successor Servicer shall
be deemed to have assumed all of the Servicer's interest therein and to have
replaced the Servicer as a party to any Subservicing Agreement entered into by
the Servicer as contemplated by Section 3.02 to the same extent as if the
Subservicing Agreement had been assigned to the assuming party except that the
Servicer shall not be relieved of any liability or obligations under any such
Subservicing Agreement.
The Servicer that is no longer the Servicer hereunder shall, upon
request of the Trustee, but at the expense of such predecessor Servicer, deliver
to the assuming party all documents and records relating to each Subservicing
Agreement or substitute servicing agreement and the Mortgage Loans then being
serviced thereunder and an accounting of amounts collected or held by it and
otherwise use its best efforts to effect the orderly and efficient transfer of
such substitute Subservicing Agreement to the assuming party. The Trustee shall
be entitled to be reimbursed from the predecessor Servicer (or the Trust if the
predecessor Servicer is unable to fulfill its obligations hereunder) for all
Servicing Transfer Costs.
Section 3.08 Collection of Mortgage Loan Payments; Servicer
Custodial Account; Certificate Account;. (a) Continuously from the date hereof
until the principal and interest on all Mortgage Loans are paid in full, the
Servicer will proceed diligently, in accordance with this Agreement, to collect
all payments due under each of the Mortgage Loans it services when the same
shall become due and payable. Further, the Servicer will in accordance with all
applicable law and Customary Servicing Procedures ascertain and estimate taxes,
assessments, fire and hazard insurance premiums, mortgage insurance premiums and
all other charges with respect to the Mortgage Loans it services that, as
provided in any Mortgage, will become due and payable to the end that the
installments payable by the Mortgagors will be sufficient to pay such charges as
and when they become due and payable. Consistent with the foregoing, the
Servicer may in its discretion (i) waive any late payment charge or any
prepayment charge or penalty interest in connection with the prepayment of a
Mortgage Loan it services and (ii) extend the due dates for payments due on a
Mortgage Note for a period not greater than 120 days; provided, however, that
the Servicer cannot extend the maturity of any such Mortgage Loan past the date
on which the final payment is due on the latest maturing Mortgage Loan as of the
Cut-off Date. In the event of any such arrangement, the Servicer shall make
Periodic Advances on the related Mortgage Loan in accordance with the provisions
of Section 3.20 during the scheduled period in accordance with the amortization
schedule of such Mortgage Loan without modification thereof by reason of such
arrangements. The Servicer shall not be required to institute or join in
litigation with respect to collection of any payment (whether under a Mortgage,
Mortgage Note or otherwise or against any public or governmental authority with
respect to a taking or condemnation) if it reasonably believes that enforcing
the provision of the Mortgage or other instrument pursuant to which such payment
is required is prohibited by applicable law.
(b) The Servicer shall establish and maintain the Servicer Custodial
Account. The Servicer shall deposit or cause to be deposited into the
Servicer Custodial Account, all on a daily basis within one Business Day of
receipt, except as otherwise specifically provided herein, the following
payments and collections remitted by Subservicers or received by the Servicer
in respect of the Mortgage Loans subsequent to the Cut-off Date (other than
in respect of principal and interest due on the Mortgage Loans on or before
the Cut-off Date) and the following amounts required to be deposited
hereunder with respect to the Mortgage Loans it services:
(i) all payments on account of principal of the Mortgage Loans,
including Principal Prepayments;
(ii) all payments on account of interest on the Mortgage Loans, net
of the Servicing Fee;
(iii) (A) all Insurance Proceeds and Liquidation Proceeds, other
than Insurance Proceeds to be (1) applied to the restoration or repair of
the Mortgaged Property, (2) released to the Mortgagor in accordance with
Customary Servicing Procedures or (3) required to be deposited to an
Escrow Account pursuant to Section 3.09(a), and other than any Excess
Proceeds and (B) any Insurance Proceeds released from an Escrow Account
pursuant to Section 3.09(b)(iv);
(iv) any amount required to be deposited by the Servicer pursuant to
Section 3.08(d) in connection with any losses on Permitted Investments
with respect to the Servicer Custodial Account;
(v) any amounts required to be deposited by the Servicer pursuant to
Section 3.14;
(vi) all Repurchase Prices, all Substitution Adjustment Amounts and
all Reimbursement Amounts, to the extent received by the Servicer;
(vii) Periodic Advances made by the Servicer pursuant to Section
3.20 and any Compensating Interest;
(viii) any Recoveries; and
(ix) any other amounts required to be deposited hereunder.
The foregoing requirements for deposits to the Servicer Custodial
Account by the Servicer shall be exclusive it being understood and agreed that,
without limiting the generality of the foregoing, Ancillary Income need not be
deposited by the Servicer. If the Servicer shall deposit in the Servicer
Custodial Account any amount not required to be deposited, it may at any time
withdraw or direct the institution maintaining the Servicer Custodial Account to
withdraw such amount from the Servicer Custodial Account, any provision herein
to the contrary notwithstanding. The Servicer Custodial Account may contain
funds that belong to one or more trust funds created for mortgage pass-through
certificates of other series and may contain other funds respecting payments on
mortgage loans belonging to the Servicer or serviced by the Servicer on behalf
of others. Notwithstanding such commingling of funds, the Servicer shall keep
records that accurately reflect the funds on deposit in the Servicer Custodial
Account that have been identified by it as being attributable to the Mortgage
Loans it services. The Servicer shall maintain adequate records with respect to
all withdrawals made pursuant to this Section 3.08. All funds required to be
deposited in the Servicer Custodial Account shall be held in trust for the
Certificateholders until withdrawn in accordance with Section 3.11.
(c) The Trustee shall establish and maintain, on behalf of the
Certificateholders, the Certificate Account. The Trustee shall, promptly upon
receipt, deposit in the Certificate Account and retain therein the following:
(i) the aggregate amount remitted by the Servicer to the Trustee
pursuant to Section 3.11(a)(viii);
(ii) any amount paid by the Trustee pursuant to Section 3.08(d) in
connection with any losses on Permitted Investments with respect to the
Certificate Account; and
(iii) any other amounts deposited hereunder which are required to be
deposited in the Certificate Account.
If the Servicer shall remit any amount not required to be remitted,
it may at any time direct the Trustee 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
Trustee which describes the amounts deposited in error in the Certificate
Account. All funds required to be deposited in the Certificate Account shall be
held by the Trustee in trust for the Certificateholders until disbursed in
accordance with this Agreement or withdrawn in accordance with Section 3.11. In
no event shall the Trustee incur liability for withdrawals from the Certificate
Account at the direction of the Servicer.
(d) Each institution at which the Servicer Custodial Account or the
Certificate Account is maintained shall invest the funds therein as directed
in writing by the Servicer, in the case of the Servicer Custodial Account, or
the Trustee, in the case of the Certificate Account, in Permitted
Investments, which shall mature not later than (i) in the case of the
Servicer Custodial Account, the Business Day next preceding the related
Remittance Date (except that if such Permitted Investment is an obligation of
the institution that maintains such account, then such Permitted Investment
shall mature not later than such Remittance Date) and (ii) in the case of the
Certificate Account, the Business Day next preceding the Distribution Date
(except that if such Permitted Investment is an obligation of the institution
that maintains such account, then such Permitted Investment shall mature not
later than such Distribution Date) and, in each case, shall not be sold or
disposed of prior to its maturity. All such Permitted Investments shall be
made in the name of the Trustee, for the benefit of the Certificateholders.
All Servicer Custodial Account Reinvestment Income shall be for the benefit
of the Servicer as part of its Servicing Compensation and shall be retained
by it monthly as provided herein. All income or 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 Trustee as additional compensation
and shall be retained by it monthly as provided herein. The amount of any
losses realized in the Servicer Custodial Account or the Certificate Account
incurred in any such account in respect of any such investments shall
promptly be deposited by the Servicer in the Servicer Custodial Account or by
the Trustee in the Certificate Account, as applicable.
(e) The Servicer shall give notice to the Trustee of any proposed
change of the location of the Servicer Custodial Account maintained by the
Servicer not later than 30 days and not more than 45 days prior to any change
thereof. The Trustee shall give notice to the Servicer, each Rating Agency
and the Depositor of any proposed change of the location of the Certificate
Account not later than 30 days after and not more than 45 days prior to any
change thereof. The creation of the Servicer Custodial Account shall be
evidenced by a certification substantially in the form of Exhibit F hereto. A
copy of such certification shall be furnished to the Trustee.
Section 3.09 Collection of Taxes, Assessments and Similar Items;
Escrow Accounts. (a) To the extent required by the related Mortgage Note and not
violative of current law, the Servicer shall segregate and hold all funds
collected and received pursuant to each Mortgage Loan which constitute Escrow
Payments in trust separate and apart from any of its own funds and general
assets and for such purpose shall establish and maintain one or more escrow
accounts (collectively, the "Escrow Account"), titled "Bank of America, National
Association, in trust for registered holders of Banc of America Alternative Loan
Trust 2006-7 Mortgage Pass-Through Certificates, Series 2006-7 and various
Mortgagors." The Escrow Account shall be established with a commercial bank, a
savings bank or a savings and loan association that meets the guidelines set
forth by Xxxxxx Mae or Xxxxxxx Mac as an eligible institution for escrow
accounts and which is a member of the Automated Clearing House. In any case, the
Escrow Account shall be insured by the FDIC to the fullest extent permitted by
law. The Servicer shall deposit in the appropriate Escrow Account on a daily
basis, and retain therein: (i) all Escrow Payments collected on account of the
Mortgage Loans, (ii) all amounts representing proceeds of any hazard insurance
policy which are to be applied to the restoration or repair of any related
Mortgaged Property and (iii) all amounts representing proceeds of any Primary
Insurance Policy. Nothing herein shall require the Servicer to compel a
Mortgagor to establish an Escrow Account in violation of applicable law.
(b) Withdrawals of amounts so collected from the Escrow Accounts may
be made by the Servicer only (i) to effect timely payment of taxes,
assessments, mortgage insurance premiums, fire and hazard insurance premiums,
condominium or PUD association dues, or comparable items constituting Escrow
Payments for the related Mortgage, (ii) to reimburse the Servicer out of
related Escrow Payments made with respect to a Mortgage Loan for any
Servicing Advance made by the Servicer pursuant to Section 3.09(c) with
respect to such Mortgage Loan, (iii) to refund to any Mortgagor any sums
determined to be overages, (iv) for transfer to the Servicer Custodial
Account upon default of a Mortgagor or in accordance with the terms of the
related Mortgage Loan and if permitted by applicable law, (v) for application
to restore or repair the Mortgaged Property, (vi) to pay to the Mortgagor, to
the extent required by law, any interest paid on the funds deposited in the
Escrow Account, (vii) to pay to itself any interest earned on funds deposited
in the Escrow Account (and not required to be paid to the Mortgagor), (viii)
to the extent permitted under the terms of the related Mortgage Note and
applicable law, to pay late fees with respect to any Monthly Payment which is
received after the applicable grace period, (ix) to withdraw suspense
payments that are deposited into the Escrow Account, (x) to withdraw any
amounts inadvertently deposited in the Escrow Account or (xi) to clear and
terminate the Escrow Account upon the termination of this Agreement in
accordance with Section 10.01. Any Escrow Account shall not be a part of the
Trust Estate.
(c) With respect to each Mortgage Loan, the Servicer shall maintain
accurate records reflecting the status of taxes, assessments and other
charges which are or may become a lien upon the Mortgaged Property and the
status of Primary Insurance Policy premiums and fire and hazard insurance
coverage. The Servicer shall obtain, from time to time, all bills for the
payment of such charges (including renewal premiums) and shall effect payment
thereof prior to the applicable penalty or termination date and at a time
appropriate for securing maximum discounts allowable, employing for such
purpose deposits of the Mortgagor in the Escrow Account, if any, which shall
have been estimated and accumulated by the Servicer in amounts sufficient for
such purposes, as allowed under the terms of the Mortgage. To the extent that
a Mortgage does not provide for Escrow Payments, the Servicer shall determine
that any such payments are made by the Mortgagor. The Servicer assumes full
responsibility for the timely payment of all such bills and shall effect
timely payments of all such bills irrespective of each Mortgagor's faithful
performance in the payment of same or the making of the Escrow Payments. The
Servicer shall advance any such payments that are not timely paid, but the
Servicer shall be required so to advance only to the extent that such
Servicing Advances, in the good faith judgment of the Servicer, will be
recoverable by the Servicer out of Insurance Proceeds, Liquidation Proceeds
or otherwise.
Section 3.10 Access to Certain Documentation and Information
Regarding the Mortgage Loans. The Servicer shall afford the Trustee reasonable
access to all records and documentation regarding the Mortgage Loans and all
accounts, insurance information and other matters relating to this Agreement,
such access being afforded without charge, but only upon reasonable request and
during normal business hours at the office designated by the Servicer.
Section 3.11 Permitted Withdrawals from the Servicer Custodial
Account and Certificate Account. (a) The Servicer may from time to time make
withdrawals from the Servicer Custodial Account, for the following purposes:
(i) to pay to the Servicer (to the extent not previously retained),
the Servicing Compensation to which it is entitled pursuant to Section
3.17;
(ii) to reimburse the Servicer for unreimbursed Advances made by it,
such right of reimbursement pursuant to this clause (ii) being limited to
amounts received on the Mortgage Loan(s) (including amounts received in
respect of BPP Mortgage Loan Payments for such Mortgage Loan) in respect
of which any such Advance was made;
(iii) to reimburse the Servicer for any Nonrecoverable Advance
previously made;
(iv) to reimburse the Servicer for Insured Expenses from the related
Insurance Proceeds;
(v) to pay to the purchaser, with respect to each Mortgage Loan or
REO Property that has been purchased pursuant to Section 2.02 or 2.04, all
amounts received thereon after the date of such purchase;
(vi) to reimburse the Servicer or the Depositor for expenses
incurred by any of them and reimbursable pursuant to Section 7.03;
(vii) to withdraw any amount deposited in the Servicer Custodial
Account and not required to be deposited therein;
(viii) on or prior to the Remittance Date, to withdraw an amount
equal to the related Interest Remittance Amount and Principal Remittance
Amount for such Distribution Date, to the extent on deposit, and remit
such amount in immediately available funds to the Trustee for deposit in
the Certificate Account; and
(ix) to clear and terminate the Servicer Custodial Account upon
termination of this Agreement pursuant to Section 10.01.
The Servicer shall keep and maintain separate accounting, on a
Mortgage Loan by Mortgage Loan basis, for the purpose of justifying any
withdrawal from the Servicer Custodial Account pursuant to clauses (i), (ii),
(iv) and (v). Prior to making any withdrawal from the Servicer Custodial Account
pursuant to clause (iii), the Servicer shall deliver to the Trustee an Officer's
Certificate of a Servicing Officer indicating the amount of any previous Advance
determined by the Servicer to be a Nonrecoverable Advance and identifying the
related Mortgage Loan(s) and their respective portions of such Nonrecoverable
Advance. The Servicer shall notify the Depositor and the Trustee of the amount,
purpose and party paid pursuant to clause (vi) above.
(b) The Trustee shall be deemed to withdraw funds from the
Certificate Account for distributions to Certificateholders in the manner
specified in this Agreement. In addition, the Trustee may from time to time make
withdrawals from the Certificate Account for the following purposes:
(i) to pay to itself the Trustee Fee, to the extent not paid under
Section 5.02(a);
(ii) to pay to itself as additional compensation earnings on or
investment income with respect to funds in the Certificate Account and any
other amounts (other than the Trustee Fee) due to it under this Agreement
for the related Distribution Date;
(iii) to withdraw and return to the Servicer any amount deposited in
the Certificate Account and not required to be deposited therein; and
(iv) to clear and terminate the Certificate Account upon termination
of this Agreement pursuant to Section 10.01.
The Trustee shall notify the Depositor and the Servicer of the
amount and purpose of any payments made pursuant to clause (ii) above (other
than any earnings or investment income with respect to funds in the Certificate
Account).
Section 3.12 Maintenance of Hazard Insurance. The Servicer shall
cause to be maintained for each Mortgage Loan, fire and hazard insurance with
extended coverage customary in the area where the Mortgaged Property is located
in an amount which is at least equal to the lesser of (a) the full insurable
value of the Mortgaged Property or (b) the greater of (i) the outstanding
principal balance owing on the Mortgage Loan and (ii) an amount such that the
proceeds of such insurance shall be sufficient to avoid the application to the
Mortgagor or loss payee of any coinsurance clause under the policy. If the
Mortgaged Property is 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 Servicer will cause to be
maintained a flood insurance policy meeting the requirements of the current
guidelines of the Federal Insurance Administration and the requirements of
Xxxxxx Xxx or Xxxxxxx Mac. The Servicer shall also maintain on REO Property,
fire and hazard insurance with extended coverage in an amount which is at least
equal to the maximum insurable value of the improvements which are a part of
such property, liability insurance and, to the extent required, flood insurance
in an amount required above. Any amounts collected by the Servicer under any
such policies (other than amounts to be deposited in an Escrow Account and
applied to the restoration or repair of the property subject to the related
Mortgage or property acquired in liquidation of the Mortgage Loan, or to be
released to the Mortgagor in accordance with Customary Servicing Procedures)
shall be deposited in the Servicer Custodial Account, subject to withdrawal
pursuant to Section 3.11(a). It is understood and agreed that no earthquake or
other additional insurance need be required by the Servicer of any Mortgagor or
maintained on REO Property, other than pursuant to such applicable laws and
regulations as shall at any time be in force and as shall require such
additional insurance. All policies required hereunder shall be endorsed with
standard mortgagee clauses with loss payable to the Servicer, and shall provide
for at least 30 days' prior written notice of any cancellation, reduction in
amount or material change in coverage to the Servicer.
The hazard insurance policies for each Mortgage Loan secured by a
unit in a condominium development or planned unit development shall be
maintained with respect to such Mortgage Loan and the related development in a
manner which is consistent with Xxxxxx Mae requirements.
Notwithstanding the foregoing, the Servicer may maintain a blanket
policy insuring against hazard losses on all of the Mortgaged Properties
relating to the Mortgage Loans in lieu of maintaining the required hazard
insurance policies for each Mortgage Loan and may maintain a blanket policy
insuring against special flood hazards in lieu of maintaining any required flood
insurance. Any such blanket policies shall (A) be consistent with prudent
industry standards, (B) name the Servicer as loss payee, (C) provide coverage in
an amount equal to the aggregate unpaid principal balance on the related
Mortgage Loans without co-insurance, and (D) otherwise comply with the
requirements of this Section 3.12. Any such blanket policy may contain a
deductible clause; provided that if any Mortgaged Property is not covered by a
separate policy otherwise complying with this Section 3.12 and a loss occurs
with respect to such Mortgaged Property which loss would have been covered by
such a policy, the Servicer shall deposit in the Servicer Custodial Account the
difference, if any, between the amount that would have been payable under a
separate policy complying with this Section 3.12 and the amount paid under such
blanket policy.
Section 3.13 Enforcement of Due-On-Sale Clauses; Assumption
Agreements. (a) Except as otherwise provided in this Section 3.13, when any
Mortgaged Property subject to a Mortgage has been conveyed by the Mortgagor, the
Servicer shall use reasonable efforts, to the extent that it has actual
knowledge of such conveyance, to enforce any due-on-sale clause contained in any
Mortgage Note or Mortgage, to the extent permitted under applicable law and
governmental regulations, but only to the extent that such enforcement will not
adversely affect or jeopardize coverage under any Required Insurance Policy.
Notwithstanding the foregoing, the Servicer is not required to exercise such
rights with respect to a Mortgage Loan if the Person to whom the related
Mortgaged Property has been conveyed or is proposed to be conveyed satisfies the
terms and conditions contained in the Mortgage Note and Mortgage related thereto
and the consent of the mortgagee under such Mortgage Note or Mortgage is not
otherwise required under such Mortgage Note or Mortgage as a condition to such
transfer. If (i) the Servicer is prohibited by law from enforcing any such
due-on-sale clause, (ii) coverage under any Required Insurance Policy would be
adversely affected, (iii) the Mortgage Note does not include a due-on-sale
clause or (iv) nonenforcement is otherwise permitted hereunder, the Servicer is
authorized, subject to Section 3.13(b), to take or enter into an assumption and
modification agreement from or with the Person to whom such Mortgaged Property
has been or is about to be conveyed, pursuant to which such Person becomes
liable under the Mortgage Note and, unless prohibited by applicable state law,
the Mortgagor remains liable thereon; provided that the Mortgage Loan shall
continue to be covered (if so covered before the Servicer enters such agreement)
by the applicable Required Insurance Policies. The Servicer, subject to Section
3.13(b), is also authorized with the prior approval of the insurers under any
Required Insurance Policies to enter into a substitution of liability agreement
with such Person, pursuant to which the original Mortgagor is released from
liability and such Person is substituted as Mortgagor and becomes liable under
the Mortgage Note. Notwithstanding the foregoing, the Servicer shall not be
deemed to be in default under this Section 3.13 by reason of any transfer or
assumption which the Servicer reasonably believes it is restricted by law from
preventing, for any reason whatsoever.
(b) Subject to the Servicer's duty to enforce any due-on-sale clause
to the extent set forth in Section 3.13(a), in any case in which a Mortgaged
Property has been conveyed to a Person by a Mortgagor, and such Person is to
enter into an assumption agreement or modification agreement or supplement to
the Mortgage Note or Mortgage or if an instrument of release is required
releasing the Mortgagor from liability on the Mortgage Loan, the Servicer
shall prepare and execute the assumption agreement with the Person to whom
the Mortgaged Property is to be conveyed and such modification agreement or
supplement to the Mortgage Note or Mortgage or other instruments as are
reasonable or necessary to carry out the terms of the Mortgage Note or
Mortgage or otherwise to comply with any applicable laws regarding
assumptions or the transfer of the Mortgaged Property to such Person. In
connection with any such assumption, no material term of the Mortgage Note
may be changed. In addition, the substitute Mortgagor and the Mortgaged
Property must be acceptable to the Servicer in accordance with its
underwriting standards as then in effect. Together with each such
substitution, assumption or other agreement or instrument, the Servicer shall
execute an Officer's Certificate signed by a Servicing Officer stating that
the requirements of this subsection have been met. The Servicer shall notify
the Trustee that any such substitution or assumption agreement has been
completed by forwarding to the Trustee (or at the direction of the Trustee,
the Custodian) the Officer's Certificate described in the previous sentence
and the original of such substitution or assumption agreement, which in the
case of the original shall be added to the related Mortgage File and shall,
for all purposes, be considered a part of such Mortgage File to the same
extent as all other documents and instruments constituting a part thereof.
Any fee collected by the Servicer for entering into an assumption or
substitution of liability agreement may be retained by the Servicer as
additional Servicing Compensation.
Section 3.14 Realization Upon Defaulted Mortgage Loans; REO
Property. Subject to Section 3.21, the Servicer shall use reasonable efforts to
foreclose upon or otherwise comparably convert the ownership of Mortgaged
Properties securing such of the Mortgage Loans as come into and continue in
default and as to which no satisfactory arrangements can be made for collection
of delinquent payments. In connection with such foreclosure or other conversion,
the Servicer shall follow Customary Servicing Procedures and shall meet the
requirements of the insurer under any Required Insurance Policy; provided,
however, that the Servicer may enter into a special servicing agreement with an
unaffiliated Holder of 100% Percentage Interest of a Class of Subordinate
Certificates or a holder of a class of securities representing interests in the
Subordinate Certificates alone or together with other subordinated mortgage
pass-through certificates. Such agreement shall be substantially in the form
attached hereto as Exhibit K or subject to each Rating Agency's acknowledgment
that the ratings of the Certificates in effect immediately prior to the entering
into such agreement would not be qualified, downgraded or withdrawn and the
Certificates would not be placed on credit review status (except for possible
upgrading) as a result of such agreement. Any such agreement may contain
provisions whereby such holder may instruct the Servicer to commence or delay
foreclosure proceedings with respect to delinquent Mortgage Loans and will
contain provisions for the deposit of cash by the holder that would be available
for distribution to Certificateholders if Liquidation Proceeds are less than
they otherwise may have been had the Servicer acted in accordance with its
normal procedures. Notwithstanding the foregoing, the Servicer shall not be
required to expend its own funds in connection with any foreclosure or towards
the restoration of any Mortgaged Property unless it shall determine (i) that
such restoration and/or foreclosure will increase the proceeds of liquidation of
the Mortgage Loan after reimbursement to itself of such expenses and (ii) that
such expenses will be recoverable to it through proceeds of the liquidation of
the Mortgage Loan (respecting which it shall have priority for purposes of
withdrawals from the Servicer Custodial Account). Any such expenditures shall
constitute Servicing Advances for purposes of this Agreement.
With respect to any REO Property, the deed or certificate of sale
shall be taken in the name of the Trustee for the benefit of the
Certificateholders, or its nominee, on behalf of the Certificateholders. The
Trustee's name shall be placed on the title to such REO Property solely as the
Trustee hereunder and not in its individual capacity. The Servicer shall ensure
that the title to such REO Property references this Agreement and the Trustee's
capacity hereunder. Pursuant to its efforts to sell such REO Property, the
Servicer shall either itself or through an agent selected by the Servicer
manage, conserve, protect and operate such 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. Incident to its conservation and protection of the
interests of the Certificateholders, the Servicer may rent the same, or any part
thereof, as the Servicer deems to be in the best interest of the
Certificateholders for the period prior to the sale of such REO Property. The
Servicer shall prepare for and deliver to the Trustee a statement with respect
to each REO Property that has been rented, if any, showing the aggregate rental
income received and all expenses incurred in connection with the management and
maintenance of such REO Property at such times as is necessary to enable the
Trustee to comply with the reporting requirements of the REMIC Provisions;
provided, however, that the Servicer shall have no duty to rent any REO Property
on behalf of the Trust. The net monthly rental income, if any, from such REO
Property shall be deposited in the Servicer Custodial Account no later than the
close of business on each Determination Date. The Servicer shall perform, with
respect to the Mortgage Loans, 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, if 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.
If the Trust acquires any Mortgaged Property as described above or
otherwise in connection with a default or a default which is reasonably
foreseeable on a Mortgage Loan, the Servicer shall dispose of such Mortgaged
Property prior to the end of the third calendar year following the year of its
acquisition by the Trust (such period, the "REO Disposition Period") unless (A)
the Trustee shall have been supplied by the Servicer with an Opinion of Counsel
to the effect that the holding by the Trust of such Mortgaged Property
subsequent to the REO Disposition Period will not result in the imposition of
taxes on "prohibited transactions" (as defined in Section 860F of the Code) on
either REMIC 1 or REMIC 2 or cause either REMIC created hereunder to fail to
qualify as a REMIC at any time that any Certificates are outstanding, or (B) the
Trustee (at the Servicer's expense) or the Servicer shall have applied for,
prior to the expiration of the REO Disposition Period, an extension of the REO
Disposition Period in the manner contemplated by Section 856(e)(3) of the Code.
If such an Opinion of Counsel is provided or such an exemption is obtained, the
Trust may continue to hold such Mortgaged Property (subject to any conditions
contained in such Opinion of Counsel) for the applicable period. Notwithstanding
any other provision of this Agreement, no Mortgaged Property acquired by the
Trust 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 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 either 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 or otherwise, unless the Servicer has
agreed to indemnify and hold harmless the Trust with respect to the imposition
of any such taxes. The Servicer shall identify to the Trustee any Mortgaged
Property relating to a Mortgage Loan held by the Trust for 30 months for which
no plans to dispose of such Mortgaged Property by the Servicer have been made.
After delivery of such identification, the Servicer shall proceed to dispose of
any such Mortgaged Property by holding a commercially reasonable auction for
such property.
The income earned from the management of any REO Properties, net of
reimbursement to the Servicer for expenses incurred (including any property or
other taxes) in connection with such management and net of unreimbursed
Servicing Fees, Periodic Advances and Servicing Advances, shall be applied to
the payment of principal of and interest on the related defaulted Mortgage Loans
(solely for the purposes of allocating principal and interest, interest shall be
treated as accruing as though such Mortgage Loans were still current) and all
such income shall be deemed, for all purposes in this Agreement, to be payments
on account of principal and interest on the related Mortgage Notes and shall be
deposited into the Servicer Custodial 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 Interest Rate
on the related Mortgage Loan for such calendar month, such excess shall be
considered to be a partial prepayment of principal of the related Mortgage Loan.
The proceeds from any liquidation of a Mortgage Loan, as well as any
income from an REO Property, will be applied in the following order of priority:
first, to reimburse the Servicer for any related unreimbursed Servicing Advances
and Servicing Fees; second, to reimburse the Servicer for any unreimbursed
Periodic Advances and to reimburse the Servicer Custodial Account for any
Nonrecoverable Advances (or portions thereof) that were previously withdrawn by
the Servicer pursuant to Section 3.11(a)(iii) that related to such Mortgage
Loan; third, to accrued and unpaid interest (to the extent no Periodic Advance
has been made for such amount or any such Periodic Advance has been reimbursed)
on the Mortgage Loan or related REO Property, at the Mortgage Interest Rate to
the Due Date occurring in the month in which such amounts are required to be
distributed; and fourth, as a recovery of principal of the Mortgage Loan. Excess
Proceeds, if any, from the liquidation of a Liquidated Mortgage Loan will be
retained by the Servicer as additional Servicing Compensation pursuant to
Section 3.17.
Section 3.15 Trustee to Cooperate; Release of Mortgage Files. Upon
the payment in full of any Mortgage Loan, or the receipt by the Servicer of a
notification that payment in full will be escrowed in a manner customary for
such purposes, the Servicer will immediately notify the Trustee (or, at the
direction of the Trustee, the Custodian) by delivering, or causing to be
delivered, two copies (one of which will be returned to the Servicer with the
Mortgage File) of a Request for Release (which may be delivered in an electronic
format acceptable to the Trustee and the Servicer). Upon receipt of such
request, the Trustee or the Custodian, as applicable, shall within seven
Business Days release the related Mortgage File to the Servicer. The Trustee
shall deliver to the Servicer the Mortgage Note with written evidence of
cancellation thereon. If the Mortgage has been recorded in the name of MERS or
its designee, the Servicer shall take all necessary action to reflect the
release of the Mortgage on the records of MERS. Expenses incurred in connection
with any instrument of satisfaction or deed of reconveyance shall be chargeable
to the related Mortgagor. From time to time and as shall be appropriate for the
servicing or foreclosure of any Mortgage Loan, including for such purpose
collection under any policy of flood insurance, any fidelity bond or errors or
omissions policy, or for the purposes of effecting a partial release of any
Mortgaged Property from the lien of the Mortgage or the making of any
corrections to the Mortgage Note or the Mortgage or any of the other documents
included in the Mortgage File, the Trustee or the Custodian, as applicable,
shall, upon delivery to the Trustee (or, at the direction of the Trustee, the
Custodian) of a Request for Release signed by a Servicing Officer, release the
Mortgage File within seven Business Days to the Servicer. Subject to the further
limitations set forth below, the Servicer shall cause the Mortgage File so
released to be returned to the Trustee or the Custodian, as applicable, when the
need therefor by the Servicer no longer exists, unless the Mortgage Loan is
liquidated and the proceeds thereof are deposited in the Servicer Custodial
Account, in which case the Servicer shall deliver to the Trustee or the
Custodian, as applicable, a Request for Release, signed by a Servicing Officer.
Upon prepayment in full of any Mortgage Loan or the receipt of
notice that funds for such purpose have been placed in escrow, the Servicer
shall give an instrument of satisfaction (or Assignment of Mortgage without
recourse) regarding the Mortgaged Property relating to such Mortgage Loan, which
instrument of satisfaction or Assignment of Mortgage, as the case may be, shall
be delivered to the Person entitled thereto against receipt of the prepayment in
full. If the Mortgage is registered in the name of MERS or its designee, the
Servicer shall take all necessary action to reflect the release on the records
of MERS. In lieu of executing such satisfaction or Assignment of Mortgage, or if
another document is required to be executed by the Trustee, the Servicer may
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 3.16 Documents, Records and Funds in Possession of the
Servicer to Be Held for the Trustee. The Servicer shall transmit to the Trustee
or, at the direction of the Trustee, the Custodian as required by this Agreement
all documents and instruments in respect of a Mortgage Loan coming into the
possession of the Servicer from time to time and shall account fully to the
Trustee for any funds received by the Servicer or which otherwise are collected
by the Servicer as Liquidation Proceeds or Insurance Proceeds in respect of any
Mortgage Loan. The documents constituting the Servicing File shall be held by
the Servicer as custodian and bailee for the Trustee. All Mortgage Files and
funds collected or held by, or under the control of, the Servicer in respect of
any 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 the Servicer Custodial Account, shall be held by the Servicer for
and on behalf of the Trustee and shall be and remain the sole and exclusive
property of the Trustee, subject to the applicable provisions of this Agreement.
The Servicer also agrees that it shall not knowingly create, incur or subject
any Mortgage File or any funds that are deposited in the Servicer Custodial
Account, Certificate Account or any Escrow Account, or any funds that otherwise
are or may become due or payable to the Trustee for the benefit of the
Certificateholders, to any claim, lien, security interest, judgment, levy, writ
of attachment or other encumbrance created by the Servicer, or assert by legal
action or otherwise any claim or right of setoff against any Mortgage File or
any funds collected on, or in connection with, a Mortgage Loan, except, however,
that the Servicer shall be entitled to set off against and deduct from any such
funds any amounts that are properly due and payable to the Servicer under this
Agreement.
Section 3.17 Servicing Compensation. The Servicer shall be entitled
out of each payment of interest on a Mortgage Loan (or portion thereof) and
included in the Trust Estate to retain or withdraw from the Servicer Custodial
Account an amount equal to the Servicing Fee for such Distribution Date;
provided, however, that the aggregate Servicing Fee for the Servicer relating to
the Mortgage Loans shall be reduced (but not below zero) by an amount equal to
the Compensating Interest.
Any additional Servicing Compensation shall be retained by the
Servicer to the extent not required to be deposited in the Servicer Custodial
Account pursuant to Section 3.08(b). The Servicer shall be required to pay all
expenses incurred by it in connection with its servicing activities hereunder
and shall not be entitled to reimbursement therefor except as specifically
provided in this Agreement.
Section 3.18 Annual Statement as to Compliance. The Trustee and the
Servicer shall deliver, and the Servicer shall cause each Additional Servicer
engaged by it to deliver, in electronic form to the Depositor, the Trustee and
each Rating Agency on or before March 5 of each year or if such day is not a
Business Day, the next Business Day (with a 10 calendar day cure period, but in
no event later than March 15), followed by a hard copy within 10 calendar days,
commencing in March 2007, a certificate in the form required by Item 1123 of
Regulation AB, to the effect that (i) an authorized officer of the Trustee, the
Servicer or the Additional Servicer, as the case may be, has reviewed (or a
review has been made under his or her supervision of) such party's activities
under this Agreement or such other applicable agreement in the case of an
Additional Servicer, during the prior calendar year or portion thereof and (ii)
to the best of such officer's knowledge, based on such review, such party has
fulfilled all of its obligations under this Agreement, or such other applicable
agreement in the case of an Additional Servicer, in all material respects
throughout the prior calendar 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 certificate, the Depositor shall review such
certificate and, if applicable, consult with the Servicer and the Trustee as to
the nature of any failure to fulfill any obligation under the Agreement, or such
other applicable agreement in the case of an Additional Servicer, in any
material respect.
Section 3.19 Assessments of Servicing Compliance; Registered Public
Accounting Firm Attestation Reports. (a) Each of the Servicer and
the Trustee,
at its own expense, shall furnish, and shall cause any Servicing Function
Participant engaged by it to furnish, at such party's expense, to the Trustee
and the Depositor in electronic form, not later than March 5 of each year or if
such day is not a Business Day, the next Business Day (with a 10 calendar day
cure period, but in no event later than March 15), followed by a hard copy
within 10 calendar days, commencing in March 2007, a report on an assessment of
compliance with the Servicing Criteria applicable to it that contains (A) a
statement by such party of its responsibility for assessing compliance with the
Servicing Criteria applicable to it, (B) a statement that such party used the
Servicing Criteria to assess compliance with the Servicing Criteria applicable
to it, (C) such party's assessment of compliance with the Servicing Criteria
applicable to it as of and for the fiscal year covered by the Form 10-K required
to be filed pursuant to Section 3.22, including, if there has been any material
instance of noncompliance with the Servicing Criteria applicable to it, an
identification of each such failure and the nature and status thereof, and (D) a
statement that a registered public accounting firm has issued an attestation
report on such party's assessment of compliance with the Servicing Criteria
applicable to such party as of and for such period.
Each such assessment of compliance report shall be addressed to the
Depositor and the Servicer and signed by an authorized officer of the applicable
party, and shall address each of the Relevant Servicing Criteria set forth on
Exhibit Q hereto, or as set forth in the notification furnished to the Depositor
and the Trustee pursuant to Section 3.19(c). The Servicer and the Trustee hereby
acknowledge and agree that their respective assessments of compliance will cover
the items identified on Exhibit Q hereto as being covered by such party. The
parties to this Agreement acknowledge that where a particular Servicing
Criterion has multiple components, each party's assessment of compliance (and
related attestation of compliance) will relate only to those components that are
applicable to such party. Promptly after receipt of each such report on
assessment of compliance, the Depositor shall review each such report and, if
applicable, consult with the Servicer or the Trustee as to the nature of any
material instance of noncompliance with the Servicing Criteria applicable to it
(or any Servicing Function Participant engaged or utilized by the Servicer or
the Trustee, as applicable).
(b) Each of the Servicer and the Trustee, at its own expense, shall
cause, and shall cause any Servicing Function Participant engaged by it, at
such party's expense, to cause, not later than March 5 of each year or if
such day is not a Business Day, the next Business Day (with a 10 calendar day
cure period), commencing in March 2007, a registered public accounting firm
(which may also render other services to the Servicer, the Trustee, 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
electronically a report to the Depositor (with a hard copy to follow within
10 calendar days), 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 Servicing Criteria
applicable to it, and (ii) on the basis of an examination conducted by such
firm in accordance with standards for attestation engagements issued or
adopted by the Public Company Accounting Oversight Board, it is expressing an
opinion as to whether such party's assessment of compliance with the
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 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. If requested by the
Depositor, such report shall contain or be accompanied by a consent of such
accounting firm to inclusion or incorporation of such report in the
Depositor's registration statement on Form S-3 relating to the Offered
Certificates and the Form 10-K for the Trust.
Promptly after receipt of each such accountants' attestation report,
the Depositor shall review the report and, if applicable, consult with the
Servicer or the Trustee if such report (i) states that a party's assessment of
compliance was not fairly stated in any material respect or (ii) is unable to
state an overall opinion.
(c) No later than 30 days following the end of each fiscal year for
the Trust for which a Form 10-K is required to be filed, (i) the Servicer
shall forward to the Depositor the name of each Servicing Function
Participant engaged by it and what Servicing Criteria will be addressed in
the report on assessment of compliance prepared by such Servicing Function
Participant and (ii) the Trustee shall forward to the Depositor the name of
each Servicing Function Participant engaged by it and what Servicing Criteria
will be addressed in the report on assessment of compliance prepared by such
Servicing Function Participant, in each case to the extent of any change from
the prior year's notice, if any.
(d) Beginning with fiscal year 2008 and thereafter, none of the
Servicer, the Trustee or any Servicing Function Participant engaged by such
parties shall be required to deliver or cause the delivery of any such
assessments or attestation reports until April 15 unless such party has
received written notice from the Depositor that a Form 10-K is required to be
filed in respect of the Trust for the preceding fiscal year.
Section 3.20 Advances. The Servicer shall determine on or before
each Servicer Advance Date whether it is required to make a Periodic Advance
pursuant to the definition thereof. If the Servicer determines it is required to
make a Periodic Advance, it shall, on or before the Servicer Advance Date,
either (a) deposit into the Servicer Custodial Account an amount equal to the
Advance and/or (b) make an appropriate entry in its records relating to the
Servicer Custodial Account that any portion of the Amount Held for Future
Distribution with respect to a Loan Group in the Servicer Custodial Account has
been used by the Servicer in discharge of its obligation to make any such
Periodic Advance on a Mortgage Loan in such Loan Group. Any funds so applied
shall be replaced by the Servicer by deposit in the Servicer Custodial Account
no later than the close of business on the Business Day preceding the next
Servicer Advance Date. The Servicer shall be entitled to be reimbursed from the
Servicer Custodial Account for all Advances of its own funds made pursuant to
this Section 3.20 as provided in Section 3.11(a). The obligation to make
Periodic Advances with respect to any Mortgage Loan shall continue until the
ultimate disposition of the REO Property or Mortgaged Property relating to such
Mortgage Loan. The Servicer shall inform the Trustee of the amount of the
Periodic Advance to be made by the Servicer with respect to each Loan Group on
each Servicer Advance Date no later than the related Remittance Date.
The Servicer shall deliver to the Trustee on the related Servicer
Advance Date an Officer's Certificate of a Servicing Officer indicating the
amount of any proposed Periodic Advance determined by the Servicer to be a
Nonrecoverable Advance. Notwithstanding anything to the contrary, the Servicer
shall not be required to make any Periodic Advance or Servicing Advance that
would be a Nonrecoverable Advance.
Section 3.21 Modifications, Waivers, Amendments and Consents. (a)
Subject to this Section 3.21, the Servicer may agree to any modification,
waiver, forbearance, or amendment of any term of any Mortgage Loan without the
consent of the Trustee or any Certificateholder. All modifications, waivers,
forbearances or amendments of any Mortgage Loan shall be in writing and shall be
consistent with Customary Servicing Procedures.
(b) The Servicer shall not agree to enter into, and shall not enter
into, any modification, waiver (other than a waiver referred to in Section
3.13, which waiver, if any, shall be governed by Section 3.13), forbearance
or amendment of any term of any Mortgage Loan if such modification, waiver,
forbearance, or amendment would:
(i) forgive principal owing under such Mortgage Loan or permanently
reduce the interest rate on such Mortgage Loan;
(ii) affect the amount or timing of any related payment of
principal, interest or other amount payable thereunder;
(iii) in the Servicer's judgment, materially impair the security for
such Mortgage Loan or reduce the likelihood of timely payment of amounts
due thereon; or
(iv) otherwise constitute a "significant modification" within the
meaning of Treasury Regulations Section 1.860G-2(b);
unless, in the case of clauses (ii) through (iv) above, (A) such Mortgage Loan
is 90 days or more past due or (B) the Servicer delivers to the Trustee an
Opinion of Counsel to the effect that such modification, waiver, forbearance or
amendment would not affect the REMIC status of either REMIC 1 or REMIC 2.
Notwithstanding the foregoing, no Opinion of Counsel need be delivered if the
purpose of the modification is to reduce the Monthly Payment on a Mortgage Loan
as a result of a partial Principal Prepayment; provided that the Mortgage Loan
is fully amortized by its original maturity date. Subject to Customary Servicing
Procedures, the Servicer may permit a forbearance for a Mortgage Loan which in
the Servicer's judgment is subject to imminent default.
(c) The Servicer may, as a condition to granting any request by a
Mortgagor for consent, modification, waiver, forbearance or amendment, the
granting of which is within the Servicer's discretion pursuant to the
Mortgage Loan and is permitted by the terms of this Agreement, require that
such Mortgagor pay to the Servicer, as additional Servicing Compensation, a
reasonable or customary fee for the additional services performed in
connection with such request, together with any related costs and expenses
incurred by the Servicer, which amount shall be retained by the Servicer as
additional Servicing Compensation.
(d) The Servicer shall notify the Depositor and the Trustee, in
writing, of any modification, waiver, forbearance or amendment of any term of
any Mortgage Loan and the date thereof, and shall deliver to the Trustee (or,
at the direction of the Trustee, the Custodian) for deposit in the related
Mortgage File, an original counterpart of the agreement relating to such
modification, waiver, forbearance or amendment, promptly (and in any event
within ten Business Days) following the execution thereof; provided, however,
that if any such modification, waiver, forbearance or amendment is required
by applicable law to be recorded, the Servicer (i) shall deliver to the
Trustee a copy thereof and (ii) shall deliver to the Trustee such document,
with evidence of notification upon receipt thereof from the public recording
office.
Section 3.22 Reports to the Securities and Exchange Commission. (a)
The Trustee and the Servicer shall reasonably cooperate with the Depositor to
enable the Depositor to satisfy its reporting requirements under the Exchange
Act and the parties hereto shall reasonably cooperate to enable the Securities
and Exchange Commission requirements with respect to the Depositor to be met in
the event that the Securities and Exchange Commission issues additional
interpretive guidelines or promulgates rules or regulations, or in the event of
any other change of law that would require reporting arrangements or the
allocation of responsibilities with respect thereto, as described in this
Section 3.22, to be conducted or allocated in a different manner. Without
limiting the generality of the foregoing, the Trustee shall prepare on behalf of
the Depositor any Current Reports on Form 8-K (each, a "Form 8-K"), Distribution
Reports on Form 10-D (each, a "Form 10-D") and Annual Reports on Form 10-K
(each, a "Form 10-K") as required by the Exchange Act and the rules and
regulations of the Securities and Exchange Commission thereunder, the Servicer
shall sign such forms (other than Form 8-Ks) or the Depositor shall sign such
Form 8-Ks, the Trustee shall file (via the Securities and Exchange Commission's
Electronic Data Gathering and Retrieval System) such forms on behalf of the
Depositor. Notwithstanding the foregoing, the Depositor shall file the Form 8-Ks
in connection with the issuance of the Certificates.
(b) Each Form 10-D shall be filed by the Trustee within 15 days
after each Distribution Date and will include a copy of the monthly statement
to Certificateholders delivered pursuant to Section 5.04(b) (each, a
"Distribution Date Statement") for such Distribution Date as an exhibit
thereto. In addition, the Trustee shall include under Item 1 of each Form
10-D any information required by Item 1121 of Regulation AB to the extent
relevant that is not included on the Distribution Date Statement. Any
information in addition to the Distribution Date Statement and any other
information required by Item 1121 of Regulation AB ("Additional Form 10-D
Information") shall be determined by the party preparing such information as
set forth on Exhibit R-1 hereto and the Trustee shall compile such
information pursuant to the following paragraph. The Trustee will have no
duty or liability for any failure hereunder to determine or prepare any
Additional Form 10-D Information, except to the extent of its obligations as
set forth in the next paragraph.
As set forth on Exhibit R-1 hereto, within 5 calendar days after the
related Distribution Date, certain parties hereto shall be required to provide
to the Depositor and the Trustee, to the extent known by such parties, in
XXXXX-compatible format, or in such other form as otherwise agreed upon by the
Trustee and such party, (i) any Additional Form 10-D Information, if applicable
and (ii) the Depositor will approve, as to form and substance, or disapprove, as
the case may be, the inclusion of the Additional Form 10-D Information (other
than with respect to Additional Form 10-D Information provided by the Trustee).
The Depositor will be responsible for all reasonable fees and expenses assessed
or incurred by the Trustee in connection with including any Additional Form 10-D
Information on Form 10-D pursuant to this paragraph, including converting any
such information to an XXXXX-compatible format.
After preparing the Form 10-D, the Trustee shall forward
electronically a draft copy of the Form 10-D to the Depositor and the Servicer
for review. No later than 2 Business Days prior to the 15th calendar day after
the related Distribution Date, the Depositor and Servicer shall sign the Form
10-D and return an electronic or fax copy of such signed Form 10-D (with an
original executed hard copy to immediately follow) to the Trustee. If a Form
10-D cannot be filed on time or if a previously filed Form 10-D needs to be
amended, the Trustee will follow the procedures set forth in Section 3.22(e).
Form 10-D requires 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 instructs the
Trustee, with respect to each Form 10-D, to check "yes" for each item unless the
Trustee has received timely prior written notice from the Depositor that the
answer should be "no" for an item. Promptly (but no later than one Business Day)
after filing with the Securities and Exchange Commission, the Trustee will make
available on its internet website a final executed copy of each Form 10-D. The
Trustee shall have no 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-D, where such failure results from the Trustee's inability or
failure to obtain or receive, on a timely basis, any information from any party
hereto (other than the Trustee or any Servicing Function Participant utilized by
the Trustee) needed to prepare, arrange for execution or file such Form 10-D,
not resulting from its own negligence, bad faith or willful misconduct.
(c) On or before 90 days after the end of each fiscal year of the
Trust (or such earlier date as may be required by the Exchange Act and the
rules and regulations of the Securities and Exchange Commission) (the "10-K
Filing Deadline") commencing in 2007, the Trustee shall file a Form 10-K, in
form and substance as required by applicable law or applicable Securities and
Exchange Commission staff interpretations. Each such Form 10-K shall include
the following items, in each case to the extent they have been delivered to
the Trustee within the applicable time frames set forth in this Agreement:
(i) an annual compliance statement for the Trustee, the Servicer and each
Additional Servicer, as described under Section 3.18, (ii)(A) the annual
reports on assessment of compliance with Servicing Criteria for the Servicer,
the Trustee and each Servicing Function Participant, as described under
Section 3.19, and (B) if the Servicer's, the Trustee's or each Servicing
Function Participant's report on assessment of compliance with Servicing
Criteria described under Section 3.19 identifies any material instance of
noncompliance or is not included, disclosure identifying such instance of
noncompliance or disclosure that such report is not included and an
explanation thereof, as the case may be, (iii)(A) the registered public
accounting firm attestation report for the Servicer, the Trustee and each
Servicing Function Participant, as described under Section 3.19, and (B) if
any registered public accounting firm attestation report described under
Section 3.19 identifies any material instance of noncompliance or is not
included, disclosure identifying such instance of noncompliance or disclosure
that such report is not included and an explanation thereof, as the case may
be, and (iv) a Certification as described in this Section 3.22(c). Any
information in addition to (i) through (iv) above that is required to be
included on Form 10-K ("Additional Form 10-K Information") shall be prepared
by the party responsible for preparing such information as set forth on
Exhibit R-2 hereto and the Trustee shall compile such information pursuant to
the following paragraph. The Trustee will have no duty or liability for any
failure hereunder to determine or prepare any Additional Form 10-K
Information, except to the extent of its obligations as set forth in the next
paragraph.
As set forth on Exhibit R-2 hereto, no later than March 1st of each
year that the Trust is subject to the Exchange Act reporting requirements,
commencing in 2007, certain parties to this Agreement shall be required to
provide to the Trustee and the Depositor, to the extent known by such applicable
parties, in XXXXX-compatible format, or in such other form as otherwise agreed
upon by the Trustee and such party, (i) any Additional Form 10-K Information, if
applicable and (ii) the Depositor will approve, as to form and substance, or
disapprove, as the case may be, the inclusion of the Additional Form 10-K
Information (other than with respect to Additional Form 10-K Information
provided by the Trustee). The Depositor will be responsible for all reasonable
fees and expenses assessed or incurred by the Trustee in connection with
including any Additional Form 10-K Information on Form 10-K pursuant to this
paragraph, including converting any such information to an XXXXX-compatible
format.
After preparing the Form 10-K, the Trustee shall forward
electronically a draft copy of the Form 10-K to the Depositor and the Servicer
for review. No later than the close of business on the fourth Business Day prior
to the 10-K Filing Deadline, a senior officer of the Servicer in charge of the
servicing function shall sign the Form 10-K and return an electronic or fax copy
of such signed Form 10-K, together with a signed copy of the certification (the
"Certification") attached hereto as Exhibit O and required to be included with
each Form 10-K pursuant to the Xxxxxxxx-Xxxxx Act of 2002, as amended (with an
original executed hard copy of each to follow by overnight mail) to the Trustee.
If a Form 10-K cannot be filed on time or if a previously filed Form 10-K needs
to be amended, the Trustee will follow the procedures set forth in Section
3.22(e). Form 10-K requires 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 Trustee that the Depositor has filed all such required reports
during the preceding 12 months and that is has been subject to such filing
requirement for the past 90 days. The Depositor shall notify the Trustee in
writing, no later than March 15th with respect to the filing of a report on Form
10-K, if the answer to either question should be "no." The Trustee shall be
entitled to rely on such representations in preparing, executing and/or filing
any such report. Promptly (but no later than one Business Day) after filing with
the Securities and Exchange Commission, the Trustee will make available on its
internet website a final executed copy of each Form 10-K. The parties to this
Agreement acknowledge that the performance by the Trustee of its duties under
this Section 3.22(c) relating to the timely preparation and filing of Form 10-K
is contingent upon such parties (and any Additional Servicer or Servicing
Function Participant) strictly observing all applicable deadlines in the
performance of their duties under this Section 3.22, Section 3.18 and Section
3.19. The Trustee shall have no liability for any loss, expense, damage, 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 Trustee's inability or
failure to obtain or receive, on a timely basis, any information from any party
hereto (other than the Trustee or any Servicing Function Participant utilized by
the Trustee) needed to prepare, arrange for execution or file such Form 10-K,
not resulting from its own negligence, bad faith or willful misconduct.
For so long as the Trust is subject to the reporting requirements of
the Exchange Act, the Trustee shall provide to the Servicer, on or before March
5 of each year or if such day is not a Business Day, the next Business Day (with
a 10 calendar day cure period), followed by a hard copy within 10 days,
commencing in March 2007, and otherwise within a reasonable period of time upon
request, a certification in the form attached hereto as Exhibit P. In the event
the Trustee is terminated or resigns pursuant to the terms of this Agreement,
such Trustee shall provide a certification in the form attached hereto as
Exhibit P with respect to the period of time it was subject to this Agreement.
In addition, the Trustee shall indemnify and hold harmless the Depositor, the
Servicer and the Sponsor and their officers, directors and affiliates from and
against any losses, damages, penalties, fines, forfeitures, reasonable and
necessary legal fees and related costs, judgments and other costs and expenses
arising out of or based upon any inaccuracy in (i) the assessment of compliance
with the Servicing Criteria pursuant to Section 3.19 provided by Trustee or any
Servicing Function Participant appointed by the Trustee and (ii) the
certification provided by the Trustee pursuant to this Section 3.22(c), any
breach of the obligations under Sections 3.19 and 3.22(c) of the Trustee or any
Servicing Function Participant appointed by the Trustee or the Trustee's or such
Servicing Function Participant's negligence, bad faith or willful misconduct in
connection therewith. If the indemnification provided for herein is unavailable
or insufficient to hold harmless the Depositor, the Servicer and the Sponsor and
their officers, directors and affiliates, then the Trustee agrees that it shall
contribute to the amount paid or payable by the Depositor, the Servicer and the
Sponsor, any of their officers, directors or affiliates as a result of the
losses, claims, damages or liabilities of the Depositor, the Servicer or the
Sponsor, any of their officers, directors or affiliates in such proportion as is
appropriate to reflect the relative fault of the Depositor, the Servicer and the
Sponsor and each of their officers, directors and affiliates on the one hand and
the Trustee on the other in connection with a breach of the Trustee's
obligations under this Section 3.22(c) or the Trustee's negligence, bad faith or
willful misconduct in connection therewith.
(d) Within four (4) Business Days after the occurrence of an event
requiring disclosure on Form 8-K (each such event, a "Reportable Event"), and
also if requested by the Depositor, the Trustee 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-Ks in connection with the
issuance of the Certificates. Any information related to a Reportable Event
or that is otherwise required to be included on Form 8-K (such information,
"Form 8-K Information") shall be reported to the Depositor and the Trustee by
the parties set forth on Exhibit R-3 hereto and compiled by the Trustee
pursuant to the following paragraph. The Trustee will have no duty or
liability for any failure hereunder to determine or prepare any Form 8-K
Information or any Form 8-K, except to the extent of its obligations as set
forth in the next paragraph.
As set forth on Exhibit R-3 hereto, for so long as the Trust is
subject to the Exchange Act reporting requirements, no later than 12:00 noon on
the second Business Day after the occurrence of a Reportable Event certain
parties to this Agreement shall be required to provide to the Depositor and the
Trustee, to the extent known by such applicable parties, in XXXXX-compatible
format, or in such other form as otherwise agreed upon by the Trustee and such
party, (i) any Form 8-K Information, if applicable and (ii) the Depositor will
approve, as to form and substance, or disapprove, as the case may be, the
inclusion of the Additional Form 8-K Information (other than with respect to
Additional Form 8-K Information provided by the Trustee). The Depositor will be
responsible for all reasonable fees and expenses assessed or incurred by the
Trustee in connection with including any Form 8-K Information on Form 8-K
pursuant to this paragraph, including converting any such information to an
XXXXX-compatible format.
After preparing the Form 8-K, the Trustee shall forward
electronically a draft copy of the Form 8-K to the Depositor for review,
verification and execution by the Depositor. No later than 12:00 noon on the
fourth Business Day after the Reportable Event, an officer of the Depositor
shall sign the Form 8-K and return an electronic or fax copy of such signed Form
8-K (with an original executed hard copy to follow by overnight mail) to the
Trustee. Promptly (but no later than one Business Day) after filing with the
Securities and Exchange Commission, the Trustee will, make available on its
internet website a final executed copy of each Form 8-K filed by it. If a Form
8-K cannot be filed on time or if a previously filed Form 8-K needs to be
amended, the Trustee will follow the procedures set forth in Section 3.22(e).
The Depositor acknowledges that the performance by the Trustee of its duties
under this Section 3.22(d) related to the timely preparation and filing of Form
8-K is contingent upon the parties to this Agreement and any other Person
obligated to provide Form 8-K Information as set forth on Exhibit R-3 hereto,
observing all applicable deadlines in the performance of their duties under this
Section 3.22(d). The Trustee shall have no 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
Trustee's inability or failure to obtain or receive, on a timely basis, any
information from any party hereto (other than the Trustee or any Servicing
Function Participant utilized by the Trustee) needed to prepare, arrange for
execution or file such Form 8-K, not resulting from its own negligence, bad
faith or willful misconduct.
(e) In the event that the Trustee is unable to timely file with the
Securities and Exchange Commission all or any required portion of any Form
8-K, Form 10-D or Form 10-K required to be filed by this Agreement because
required 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 Trustee will immediately notify the Depositor and the Servicer. In the
case of Form 10-D and Form 10-K, the Depositor, Servicer and Trustee will
cooperate to prepare and file a Form 12b-25 pursuant to Rule 12b-25 of the
Exchange Act. In the case of Form 8-K, the Trustee will, upon receipt of all
information required to be included on Form 8-K, file such Form 8-K. Within 5
calendar days following the original due date of the Form 10-D, the Trustee
shall prepare and file the related Form 10-D. Within 15 calendar days
following the original due date of the Form 10-K, the Trustee shall prepare
and file the related Form 10-K. In the event that any previously filed Form
8-K, Form 10-D or Form 10-K needs to be amended, the party to this Agreement
deciding that an amendment to such Form 8-K, Form 10-D or Form 10-K is
required will notify the Depositor, the Trustee and the Servicer and such
parties will cooperate to prepare any necessary Form 8-K/A, Form 10-D/A or
Form 10-K/A. Any Form 12b-25 or any amendment to Form 10-D or Form 10-K shall
be signed by a senior officer of the Servicer in charge of the servicing
function. Any amendment to Form 8-K or any Form 15 (as described in Section
3.22(g)) shall be signed by an officer of the Depositor. The Depositor and
Servicer acknowledge that the performance by the Trustee of its duties under
this Section 3.22(e) related to the timely preparation and filing of a Form
12b-25 or any amendment to Form 8-K, Form 10-D or Form 10-K is contingent
upon the Servicer and the Depositor performing their duties under this
Section. The Trustee shall have no liability for any loss, expense, damage,
claim arising out of or with respect to any failure to properly prepare
and/or timely file any such Form 12b-25 or any amendments to Form 8-K, Form
10-D or Form 10-K, where such failure results from the Trustee's inability or
failure to obtain or receive, on a timely basis, any information from any
other party hereto (other than the Trustee or any Servicing Function
Participant utilized by the Trustee) needed to prepare, arrange for execution
or file such Form 12b-25 or any amendments to Form 8-K, Form 10-D or Form
10-K, not resulting from its own negligence, bad faith or willful misconduct.
(f) Upon any filing with the Securities and Exchange Commission, the
Trustee shall promptly deliver or otherwise make available to the Depositor a
copy of any such executed report, statement or information.
(g) The obligations set forth in paragraphs (a) through (f) of this
Section shall only apply with respect to periods for which the Trustee is
obligated to file reports on Form 8-K, 10-D or 10-K. Unless otherwise
instructed by the Depositor, on or prior to January 30th of the first year in
which the Trustee is permitted to do so under Section 15(d) of the Exchange
Act and other applicable law and regulations, the Trustee shall prepare and
file with the Securities and Exchange Commission a Form 15 Suspension
Notification with respect to the Trust, with a copy to the Depositor. At any
time after the filing of a Form 15 Suspension Notification, if the number of
Certificateholders of record exceeds the number set forth in Section 15(d) of
the Exchange Act or the regulations promulgated pursuant thereto which would
cause the Trust to again become subject to the reporting requirements of the
Exchange Act, the Trustee shall recommence preparing and filing reports on
Form 10-D and 10-K as required pursuant to this Section and the parties
hereto will again have the obligations set forth in paragraphs (a) through
(f) of this Section.
(h) The Depositor, the Trustee and the Servicer shall notify the
Depositor and the Trustee of any proceedings of the type described in Item
1117 of Regulation AB, together with a description thereof, within five
Business Days of any such party's knowledge thereof. In addition, the
Depositor, the Trustee and the Servicer shall notify the Depositor and the
Trustee of any affiliations or relationships that develop following the
Closing Date between the Depositor, the Trustee or the Servicer and any of
parties listed in Item 1119 of Regulation AB, together with a description
thereof, within five Business Days of any such party's knowledge thereof.
ARTICLE IV
SERVICER'S CERTIFICATE
Section 4.01 Servicer's Certificate. Each month, not later than
12:00 noon Eastern time on the Business Day following each Determination Date,
the Servicer shall deliver to the Trustee, a Servicer's Certificate (in
substance and format mutually acceptable to the Servicer and the Trustee)
certified by a Servicing Officer setting forth the information necessary in
order for the Trustee to perform its obligations under this Agreement. The
Trustee may conclusively rely upon the information contained in a Servicer's
Certificate for all purposes hereunder and shall have no duty to verify or
re-compute any of the information contained therein.
ARTICLE V
PAYMENTS AND STATEMENTS TO CERTIFICATEHOLDERS;
REMIC ADMINISTRATION
Section 5.01 Distributions. On each Distribution Date, based solely
on the information in the Servicer's Certificate, the Trustee shall distribute
out of the Certificate Account (to the extent funds are available therein), to
each Certificateholder of record on the related Record Date (other than as
provided in Section 10.01 respecting the final distribution) (a) by check mailed
to such Certificateholder entitled to receive a distribution on such
Distribution Date at the address appearing in the Certificate Register, or (b)
upon written request by the Holder of a Certificate (other than the Residual
Certificate), by wire transfer or by such other means of payment as such
Certificateholder and the Trustee shall agree upon, such Certificateholder's
Percentage Interest in the amount to which the related Class of Certificates is
entitled in accordance with the priorities set forth below in Section 5.02.
None of the Holders of any Class of Certificates, the Depositor, the
Servicer or the Trustee shall in any way be responsible or liable to Holders of
any Class of Certificates in respect of amounts properly previously distributed
on any such Class.
Amounts distributed with respect to any Class of Certificates shall
be applied first to the distribution of interest thereon and then to principal
thereon.
Section 5.02 Priorities of Distributions.
(a) Distributions of Interest on the Certificates.
On each Distribution Date, the Trustee shall withdraw from the
Certificate Account, the Interest Remittance Amount (based upon the Mortgage
Loan information provided to it in the Servicer's Certificate, upon which the
Trustee may conclusively rely), and apply it, to the extent available, in the
following order of priority:
(i) to the Trustee, the Trustee Fee for such Distribution Date;
(ii) concurrently, to the Senior Certificates, pro rata (based on
the Accrued Certificate Interest for each such Class), the applicable
Accrued Certificate Interest thereon for such Distribution Date;
(iii) concurrently, to the Senior Certificates, pro rata (based on
the Interest Carry Forward Amount for each such Class), the applicable
Interest Carry Forward Amount thereon for such Distribution Date;
(iv) to the Class M-1 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date;
(v) to the Class M-2 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date;
(vi) to the Class M-3 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date;
(vii) to the Class M-4 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(viii) to the Class M-5 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(ix) the amount, if any, of the Interest Remittance Amount remaining
after application with respect to the priorities set forth above will be
applied as described under Section 5.02(c) hereof.
(b) Distributions of Principal on the Certificates.
The Trustee shall withdraw from the Certificate Account (to the
extent funds are available therein) the Principal Distribution Amount (based
upon the Mortgage Loan information provided to it in the Servicer's Certificate,
upon which the Trustee may conclusively rely) and apply it in the following
order of priority:
With respect to each Distribution Date (a) before the Stepdown Date
or (b) as to which a Trigger Event is in effect, the Principal Distribution
Amount will be allocated among and distributed in reduction of the Class
Certificate Balances of the Certificates in the following order of priority:
(i) sequentially, as follows:
(a) to the Class A-6 Certificates, up to the Priority Amount;
(b) sequentially, to the Class X-0, Xxxxx X-0, Class A-3,
Class A-4 and Class A-5 Certificates, in that order, until their
Class Certificate Balances have been reduced to zero;
(c) to the Class A-6 Certificates, until their Class
Certificate Balance has been reduced to zero;
(ii) to the Class M-1 Certificates, until their Class Certificate
Balance has been reduced to zero;
(iii) to the Class M-2 Certificates, until their Class Certificate
Balance has been reduced to zero;
(iv) to the Class M-3 Certificates, until their Class Certificate
Balance has been reduced to zero;
(v) to the Class M-4 Certificates, until their Class Certificate
Balance has been reduced to zero;
(vi) to the Class M-5 Certificates, until their Class Certificate
Balance has been reduced to zero; and
(vii) any remaining Principal Distribution Amount will be
distributed as part of the Monthly Excess Cashflow Amount as set forth in
Section 5.02(c).
With respect to each Distribution Date (a) on or after the Stepdown
Date and (b) as long as a Trigger Event is not in effect, the Principal
Distribution Amount will be allocated among and distributed in reduction of the
Class Certificate Balances of the Certificates in the following order of
priority:
(i) the Senior Principal Distribution Amount, as follows:
(a) to the Class A-6 Certificates, up to the
Priority Amount;
(b) sequentially, to the Class X-0, Xxxxx X-0,
Class A-3, Class A-4 and Class A-5 Certificates, in that
order, until their Class Certificate Balances have been
reduced to zero;
(c) to the Class A-6 Certificates, until their
Class Certificate Balance has been reduced to zero;
(ii) to the Class M-1 Certificates, up to the Class M-1 Principal
Distribution Amount, until their Class Certificate Balance has been
reduced to zero;
(iii) to the Class M-2 Certificates, up to the Class M-2 Principal
Distribution Amount, until their Class Certificate Balance has been
reduced to zero;
(iv) to the Class M-3 Certificates, up to the Class M-3 Principal
Distribution Amount, until their Class Certificate Balance has been
reduced to zero;
(v) to the Class M-4 Certificates, up to the Class M-4 Principal
Distribution Amount, until their Class Certificate Balance has been
reduced to zero;
(vi) to the Class M-5 Certificates, up to the Class M-5 Principal
Distribution Amount, until their Class Certificate Balance has been
reduced to zero; and
(vii) any remaining Principal Distribution Amount will be
distributed as part of the Monthly Excess Cashflow Amount as set forth in
Section 5.02(c)
On and after the Subordination Depletion Date, notwithstanding the
distribution priorities set forth in this Section 5.02(b), all principal
distributions to the Senior Certificates under this Section 5.02(b) will be
distributed concurrently on a pro rata basis, based on the Class Certificate
Balance of each such Class of Certificates, until the Class Certificate Balances
of each such Class has been reduced to zero.
(c) Distribution of Monthly Excess Cashflow Amounts
On each Distribution Date, any Monthly Excess Cashflow Amount shall
be distributed, to the extent available, in the following order of priority (the
"Monthly Excess Cashflow Allocation") on such Distribution Date:
(i) to the Senior Certificates, pro rata, any remaining Accrued
Certificate Interest for such Classes for such Distribution Date;
(ii) to the Senior Certificates, pro rata, any remaining Interest
Carry Forward Amounts for such Classes for such Distribution Date;
(iii) to the Class M-1 Certificates, any remaining Accrued
Certificate Interest thereon for such Distribution Date;
(iv) to the Class M-1 Certificates, any Interest Carry Forward
Amount thereon for such Distribution Date;
(v) to the Class M-1 Certificates, any Class M-1 Realized Loss
Amortization Amount for such Distribution Date;
(vi) to the Class M-2 Certificates, any remaining Accrued
Certificate Interest thereon for such Distribution Date;
(vii) to the Class M-2 Certificates, any Interest Carry Forward
Amount thereon for such Distribution Date;
(viii) to the Class M-2 Certificates, any Class M-2 Realized Loss
Amortization Amount for such Distribution Date;
(ix) to the Class M-3 Certificates, any remaining Accrued
Certificate Interest thereon for such Distribution Date;
(x) to the Class M-3 Certificates, any Interest Carry Forward
Amount thereon for such Distribution Date;
(xi) to the Class M-3 Certificates, any Class M-3 Realized
Loss Amortization Amount for such Distribution Date;
(xii) to the Class M-4 Certificates, any remaining Accrued
Certificate Interest thereon for such Distribution Date;
(xiii) to the Class M-4 Certificates, any Interest Carry
Forward Amount thereon for such Distribution Date;
(xiv) to the Class M-4 Certificates, any Class M-4 Realized
Loss Amortization Amount for such Distribution Date;
(xv) to the Class M-5 Certificates, any remaining Accrued
Certificate Interest thereon for such Distribution Date;
(xvi) to the Class M-5 Certificates, any Interest Carry
Forward Amount thereon for such Distribution Date;
(xvii) to the Class M-5 Certificates, any Class M-5 Realized
Loss Amortization Amount for such Distribution Date;
(xviii) to the Cap Carryover Reserve Account, an amount equal
to the aggregate of any Cap Carryover Amounts for such Distribution
Date; and
(xix) to the Class CE Certificates, up to the Class CE
Distributable Amount for such Distribution Date.
On each Distribution Date, there shall be distributed to the Holder
of the Class R Certificate in respect of the Class R-1 Interest, any remaining
amount in the Certificate Account on such date after the application pursuant to
Sections 5.02(a), 5.02(b) and 5.02(c).
Notwithstanding anything to the contrary contained in this
Agreement, if the Class Certificate Balance of a Class of Certificates is
reduced to zero, such Class shall be entitled to distributions from the Monthly
Excess Cashflow Amount to pay any remaining Cap Carryover Amount and any Unpaid
Realized Loss Amortization Amounts on future Distribution Dates.
On each Distribution Date, Unpaid Realized Loss Amounts on the
Offered Certificates will be reduced by the amount of any Recoveries received
during the calendar month preceding such Distribution Date in the same order as
Realized Loss Amortization Amounts are paid to the Offered Certificates pursuant
to Section 5.02(c) above.
Section 5.03 Allocation of Losses. (a) On or prior to each
Determination Date, the Servicer shall inform the Trustee in writing with
respect to each Mortgage Loan: (1) whether any Realized Loss is a Deficient
Valuation or a Debt Service Reduction, (2) of the amount of such loss or
Deficient Valuation, or of the terms of such Debt Service Reduction and (3) of
the total amount of Realized Losses on the Mortgage Loans. Based on such
information, the Trustee shall determine the total amount of Realized Losses on
the Mortgage Loans with respect to the related Distribution Date. Realized
Losses shall be allocated to the Certificates by a reduction in the Class
Certificate Balances of the designated Classes pursuant to the next paragraph.
Realized Losses shall be allocated, through the priority of
distributions in Section 5.02, first against the Monthly Excess Interest Amount
and then against the Overcollateralization Amount until such amount has been
reduced to zero. If, after giving effect to the distribution of the Principal
Distribution Amount on any Distribution Date the aggregate Class Certificate
Balance of the Certificates (other than the Class CE and Class R Certificate)
exceeds the aggregate Stated Principal Balance of the Mortgage Loans as of the
end of the related Collection Period, the resulting Applied Realized Loss Amount
will be allocated against the Class X-0, Xxxxx X-0, Class M-3, Class M-2 and
Class M-1 Certificates, until their respective Class Certificate Balances have
been reduced to zero.
(b) Notwithstanding any other provision of this Agreement, no Class
Certificate Balance of a Class will be increased on any Distribution Date
such that the Class Certificate Balance of such Class exceeds its Initial
Class Certificate Balance, less all distributions of principal previously
distributed in respect of such Class on prior Distribution Dates.
Section 5.04 Statements to Certificateholders. (a) Prior to the
Distribution Date in each month, based upon the information provided to the
Trustee on the Servicer's Certificate delivered to the Trustee pursuant to
Section 4.01 and with respect to subsections (xix) and (xxi) below, after
consultation with the Depositor, the Trustee shall determine the following
information with respect to such Distribution Date:
(i) the date of such Distribution Date and the Determination Date
for such Distribution Date;
(ii) for each Class, the applicable Record Date and Interest Accrual
Period;
(iii) the amount allocable to principal, separately identifying the
aggregate amount of any Principal Prepayments and Liquidation Proceeds
included therein;
(iv) for each Class, the amount allocable to interest;
(v) if the distribution to the Holders of such Class of Certificates
is less than the full amount that would be distributable to such Holders
if there were sufficient funds available therefor, the amount of the
shortfall and the allocation thereof as between principal and interest;
(vi) the Class Certificate Balance of each Class of Certificates
prior to and after giving effect to the distributions of principal, and
allocations of Applied Realized Loss Amounts, made on such Distribution
Date, separately identifying any reduction thereof due to allocations of
Applied Realized Loss Amounts;
(vii) the amount of the Servicing Fee paid to or retained by the
Servicer with respect to such Distribution Date;
(viii) the Pass-Through Rate for each such Class of Certificates
with respect to such Distribution Date and the Class CE Distributable
Amount;
(ix) the amount of Periodic Advances included in the distribution on
such Distribution Date, the aggregate amount of Periodic Advances
outstanding as of the close of business on such Distribution Date and the
amount of Periodic Advances reimbursed since the previous Distribution
Date;
(x) the Accrued Certificate Interest in respect of each Class of
Certificates for such Distribution Date and any related Cap Carryover
Amounts, and the respective portions thereof, if any, remaining unpaid
following the distributions made in respect of such Certificates on such
Distribution Date;
(xi) Cap Carryover Amounts distributed on such Distribution Date,
and the amounts remaining after giving effect to distributions thereof on
such Distribution Date ;
(xii) any Overcollateralization Deficiency after giving effect to
the distribution of principal on such Distribution Date;
(xiii) whether a Trigger Event has occurred and is continuing, and
the cumulative Realized Losses,
(xiv) the number and aggregate Stated Principal Balance of the
Mortgage Loans, the ranges of Mortgage Interest Rates for the Mortgage
Loans, separated by 0.25%, the weighted average remaining term to maturity
of the Mortgage Loans and the cumulative amount of Principal Prepayments,
each as of the close of business on the last day of the calendar month
preceding such Distribution Date;
(xv) the number and aggregate principal amounts of Mortgage Loans
(A) delinquent (exclusive of Mortgage Loans in foreclosure or in
bankruptcy) in 30-day increments until foreclosure or other disposition,
(B) in foreclosure, as of the close of business on the last day of the
calendar month preceding such Distribution Date and (C) in bankruptcy as
of the close of business on the last day of the calendar month preceding
such Distribution Date;
(xvi) with respect to any Mortgage Loan that became an REO Property
during the preceding calendar month, the loan number and Stated Principal
Balance of such Mortgage Loan as of the close of business on the
Determination Date preceding such Distribution Date and the date of
acquisition thereof;
(xvii) the total number and principal balance of any REO Properties
(and market value, if available) as of the close of business on the
Determination Date preceding such Distribution Date;
(xviii) the aggregate amount of Realized Losses incurred during the
preceding calendar month for such Distribution Date;
(xix) any expenses or indemnification amounts paid by the Trust, the
specific purpose of each payment and the parties to whom such payments
were made;
(xx) the amount of total Recoveries;
(xxi) the Overcollateralization Amount, the Overcollateralization
Release Amount, the Overcollateralization Deficiency and the Targeted
Overcollateralization Amount as of such Distribution Date and the Monthly
Excess Interest Amount and Monthly Excess Cashflow Amount for such
Distribution Date;
(xxii) any material modifications, extensions or waivers to Mortgage
Loan terms, fees, penalties or payments since the previous Distribution
Date and cumulatively since the Cut-off Date;
(xxiii) unless such information is set forth in the Form 10-D
relating to such Distribution Date and provided the Trustee is reasonably
able to include such information on the statement, any material breaches
of representations and warranties relating to the Mortgage Loans and any
material breach of covenants hereunder; and
(xxiv) the number and aggregate principal balance of any Mortgage
Loans repurchased by the Depositor from the Trust since the previous
Distribution Date.
(b) No later than each Distribution Date, the Trustee, based upon
information supplied to it on the Servicer's Certificate, shall make
available to each Holder of a Certificate, each Rating Agency and the
Servicer a statement setting forth the information set forth in Section
5.04(a).
In the case of information furnished pursuant to clauses (iii) and
(iv) of Section 5.04(a), the amounts shall be expressed as a dollar amount per
Certificate with a $1,000 denomination.
On each Distribution Date, the Trustee shall prepare and furnish to
each Financial Market Service, in electronic or such other format and media
mutually agreed upon by the Trustee, the Financial Market Service and the
Depositor, the information contained in the statement described in Section
5.04(a) for such Distribution Date.
The Trustee will make the monthly statement to Certificateholders
(and, at its option, any additional files containing the same information in an
alternative format) available each month to Certificateholders, and other
parties to this Agreement via the Trustee's Internet website, initially located
at "xxx.xxxxxxx.xxx". The Trustee will also make available copies of the
periodic reports the Trustee files with the Securities and Exchange Commission,
including distribution reports on Form 10-D, annual reports on Form 10-K,
current reports on Form 8-K and amendments to these reports available through
this website promptly (but no later than one Business Day) after they are filed
with the Securities and Exchange Commission. Assistance in using this website
can be obtained by calling the Trustee's customer service desk at (301)
815-6600. Parties that are unable to use the website are entitled to have a
paper copy mailed to them via first class mail by calling the customer service
desk and indicating such. The Trustee shall have the right to change the way the
monthly statements to Certificateholders are distributed in order to make such
distribution more convenient and/or more accessible to the above parties and the
Trustee shall provide timely and adequate notification to all above parties
regarding any such changes.
Within a reasonable period of time after the end of each calendar
year, the Trustee shall furnish to each Person who at any time during the
calendar year was the Holder of a Certificate, if requested in writing by such
Person, a statement containing the information set forth in clauses (iii), (iv)
and (vii) of Section 5.04(a), in each case aggregated for such calendar year or
applicable portion thereof during which such Person was a Certificateholder.
Such obligation of the Trustee shall be deemed to have been satisfied to the
extent that substantially comparable information shall be provided by the
Trustee pursuant to any requirements of the Code as from time to time in force.
The Trustee shall deliver to the Holders of Certificates any reports
or information the Trustee is required by this Agreement or the Code, Treasury
Regulations or REMIC Provisions to deliver to the Holders of Certificates, and
the Trustee shall prepare and provide to the Certificateholders (by mail,
telephone, or publication as may be permitted by applicable Treasury
Regulations) such other reasonable information as the Trustee deems necessary or
appropriate or is required by the Code, Treasury Regulations, and the REMIC
Provisions including, but not limited to, (i) information to be reported to the
Holder of the Residual Certificate for quarterly notices on Schedule Q (Form
1066) (which information shall be forwarded to the Holder of the Residual
Certificate by the Trustee), (ii) information to be provided to the Holders of
Certificates with respect to amounts which should be included as interest and
original issue discount in such Holders' gross income and (iii) information to
be provided to all Holders of Certificates setting forth the percentage of each
REMIC's assets, determined in accordance with Treasury Regulations using a
convention, not inconsistent with Treasury Regulations, selected by the Trustee
in its absolute discretion, that constitute real estate assets under Section 856
of the Code, and assets described in Section 7701(a)(19)(C) of the Code;
provided, however, that in setting forth the percentage of such assets of each
REMIC, nothing contained in this Agreement, including without limitation Section
7.03 hereof, shall be interpreted to require the Trustee periodically to
appraise the fair market values of the assets of the Trust Estate or to
indemnify the Trust Estate or any Certificateholders from any adverse federal,
state or local tax consequences associated with a change subsequently required
to be made in the Depositor's initial good faith determinations of such fair
market values (if subsequent determinations are required pursuant to the REMIC
Provisions) made from time to time.
Section 5.05 Tax Returns and Reports to Certificateholders. (a) For
federal income tax purposes, each REMIC shall have a calendar year taxable year
and shall maintain its books on the accrual method of accounting.
(b) The Trustee shall prepare or cause to be prepared, shall execute
and shall file or cause to be filed with the Internal Revenue Service and
applicable state or local tax authorities income tax information returns for
each taxable year with respect to each REMIC containing such information at
the times and in the manner as may be required by the Code, the Treasury
Regulations or state or local tax laws, regulations, or rules, and shall
furnish or cause to be furnished to each REMIC and the Certificateholders the
schedules, statements or information at such times and in such manner as may
be required thereby. Within 30 days of the Closing Date, the Trustee shall
furnish or cause to be furnished to the Internal Revenue Service, on Form
8811 or as otherwise required by the Code or the Treasury Regulations, the
name, title, address and telephone number of the person that Holders of the
Certificates may contact for tax information relating thereto, together with
such additional information at the time or times and in the manner required
by the Code or the Treasury Regulations. Such federal, state, or local income
tax or information returns shall be signed by the Trustee, or such other
Person as may be required to sign such returns by the Code, the Treasury
Regulations or state or local tax laws, regulations, or rules.
(c) In the first federal income tax return of each REMIC for its
short taxable year ending December 31, 2006, REMIC status shall be elected
for such taxable year and all succeeding taxable years.
(d) The Trustee will maintain or cause to be maintained such records
relating to each REMIC, including but not limited to records relating to the
income, expenses, assets and liabilities of the Trust Estate, and the initial
fair market value and adjusted basis of the Trust Estate property and assets
determined at such intervals as may be required by the Code or the Treasury
Regulations, as may be necessary to prepare the foregoing returns, schedules,
statements or information.
Section 5.06 Tax Matters Person. The Tax Matters Person shall have
the same duties with respect to each REMIC as those of a "tax matters partner"
under Subchapter C of Chapter 63 of Subtitle F of the Code. The Holder of the
Class R Certificate is hereby designated as the Tax Matters Person for each of
the REMICs. By its acceptance of the Class R Certificate, each such Holder
irrevocably appoints the Trustee as its agent to perform all of the duties of
the Tax Matters Person for the REMICs.
Section 5.07 Rights of the Tax Matters Person in Respect of the
Trustee. The Trustee shall afford the Tax Matters Person, upon reasonable notice
during normal business hours, access to all records maintained by the Trustee in
respect of its duties hereunder and access to officers of the Trustee
responsible for performing such duties. Upon request, the Trustee shall furnish
the Tax Matters Person with its most recent report of condition published
pursuant to law or to the requirements of its supervisory or examining authority
publicly available. The Trustee shall make available to the Tax Matters Person
such books, documents or records relating to the Trustee's services hereunder as
the Tax Matters Person shall reasonably request. The Tax Matters Person shall
not have any responsibility or liability for any action or failure to act by the
Trustee and is not obligated to supervise the performance of the Trustee under
this Agreement or otherwise.
Section 5.08 REMIC Related Covenants. For as long as the Trust shall
exist, the Trustee, the Depositor and the Servicer shall act in accordance
herewith to assure continuing treatment of REMIC 1 and REMIC 2 as REMICs and
avoid the imposition of tax on either REMIC created hereunder. In particular:
(a) The Trustee shall not create, or permit the creation of, any
"interests" in either REMIC created hereunder within the meaning of Code
Section 860D(a)(2) other than the interests represented by the Regular
Certificates and the Residual Certificate.
(b) Except as otherwise provided in the Code, (i) the Depositor and
the Servicer shall not contribute to the Trust Estate and the Trustee shall
not accept property unless substantially all of the property held in each
REMIC constitutes either "qualified mortgages" or "permitted investments" as
defined in Code Sections 860G(a)(3) and (5), respectively, and (ii) no
property shall be contributed to either REMIC created hereunder after the
start-up day unless such contribution would not subject the Trust Estate to
the 100% tax on contributions to a REMIC after the start-up day of a REMIC
imposed by Code Section 860G(d).
(c) The Trustee shall not accept on behalf of either REMIC created
hereunder any fee or other compensation for services and neither the Trustee
nor the Servicer shall knowingly accept, on behalf of the Trust Estate any
income from assets other than those permitted to be held by a REMIC.
(d) The Trustee shall not sell or permit the sale of all or any
portion of the Mortgage Loans (other than in accordance with Section 2.02 or
2.04), unless such sale is pursuant to a "qualified liquidation" of the
applicable REMIC as defined in Code Section 860F(a)(4)(A) and in accordance
with Article X.
(e) The Trustee shall maintain books with respect to the Trust and
each REMIC on a calendar year taxable year and on an accrual basis.
Neither the Servicer nor the Trustee shall engage in a "prohibited
transaction" (as defined in Code Section 860F(a)(2)), except that, with the
prior written consent of the Servicer and the Depositor, the Trustee may engage
in the activities otherwise prohibited by the foregoing paragraphs (b), (c) and
(d); provided that the Servicer shall have delivered to the Trustee an Opinion
of Counsel to the effect that such transaction will not result in the imposition
of a tax on any of the REMICs and will not disqualify either REMIC created
hereunder from treatment as a REMIC; and, provided, further, that the Servicer
shall have demonstrated to the satisfaction of the Trustee that such action will
not adversely affect the rights of the Holders of the Certificates and the
Trustee and that such action will not adversely impact the rating of the
Certificates.
Section 5.09 Grantor Trust Administration. The Trustee shall treat
the portions of the Trust Estate consisting of the right of the Offered
Certificates to receive Cap Carryover Amounts and the obligation of the Class CE
Certificates to pay Cap Carryover Amounts as a "grantor trust" under the Code,
and the provisions hereof shall be interpreted consistently with this treatment.
The Trustee shall furnish or cause to be furnished to the Holders of the Offered
Certificates and shall file or cause to be filed with the Internal Revenue
Service together with Form 1041 or such other form as may be applicable, their
allocable shares of income and expenses with respect to the property held by the
Grantor Trust, at the time or times and in the manner required by the Code.
Under no circumstances shall the Trustee have the power to vary the investments
of the Certificateholders in their related assets of the Grantor Trust in order
to take advantage of variations in this market to improve their rate of return.
Section 5.10 Cap Carryover Reserve Account
On the Closing Date, the Trustee will establish the Cap Carryover
Reserve Account (the "Cap Carryover Reserve Account"), which account will remain
uninvested, held in trust for the benefit of the Holders of the Offered
Certificates. The Cap Carryover Reserve Account will be an asset of the Trust
but not of either REMIC. On each Distribution Date, Cap Carryover Amounts
available pursuant to clause (xviii) of Section 5.02(c) will be deposited into
the Cap Carryover Reserve Account. On such Distribution Date, the Trustee shall
withdraw such Cap Carryover Amounts on deposit and apply them, sequentially, as
follows:
first, concurrently, to the Senior Certificates, pro rata (based on
the Cap Carryover Amount for each such Class), any Cap Carryover Amount for such
Class; and
second, sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class
M-4 and Class M-5 Certificates, in that order, any Cap Carryover Amount for such
Class.
Any Cap Carryover Amounts paid by the Trustee pursuant to this
Section 5.10 to the Offered Certificates shall be accounted for by the Trustee
as amounts paid first to the Class CE Certificates and then to the respective
Class or Classes of Offered Certificates from the Grantor Trust. In addition,
the Trustee shall account for the Offered Certificates' rights to receive
payments of Cap Carryover Amounts as rights in limited recourse interest rate
cap contracts written by the Class CE Certificates in favor of each Class of
Offered Certificates.
Section 5.11 REMIC Distributions.
(a) On each Distribution Date, the Trustee shall cause in the
following order of priority, the following amounts to be distributed by REMIC 1
to REMIC 2 on account of the REMIC 1 Regular Interests or withdrawn from the
Certificate Account and distributed to the Holders of the Class R Certificates
(in respect of the Class R-1 Interest), as the case may be:
(i) to Holders of REMIC 1 Regular Interest LT1AA, REMIC 1 Regular
Interest LT1A1, REMIC 1 Regular Interest LT1A2, REMIC 1 Regular Interest
LT1A3, REMIC 1 Regular Interest LT1A4, REMIC 1 Regular Interest LT1A5,
REMIC 1 Regular Interest LT1A6, REMIC 1 Regular Interest LT1M1, REMIC 1
Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1 Regular
Interest LT1M4, REMIC 1 Regular Interest LT1M5, and REMIC 1 Regular
Interest LT1ZZ, pro rata, in an amount equal to (A) the Uncertificated
Accrued Interest for such Distribution Date, plus (B) any amounts in
respect thereof remaining unpaid from previous Distribution Dates. Amounts
payable as Uncertificated Accrued Interest in respect of REMIC 1 Regular
Interest LT1ZZ shall be reduced and deferred when the REMIC 1
Overcollateralized Amount is less than the REMIC 1 Overcollateralization
Target Amount, by the lesser of (x) the amount of such difference and (y)
the Maximum LT1ZZ Uncertificated Accrued Interest Deferral Amount and such
amount will be payable to the Holders of REMIC 1 Regular Interest LT1A1,
REMIC 1 Regular Interest LT1A2, REMIC 1 Regular Interest LT1A3, REMIC 1
Regular Interest LT1A4, REMIC 1 Regular Interest LT1A5, REMIC 1 Regular
Interest LT1A6, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest
LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest LT1M4 and
REMIC 1 Regular Interest LT1M5 in the same proportion as the
Overcollateralization Deficiency is allocated to the Corresponding
Classes;
(ii) to Holders of REMIC 1 Regular Interest LT1XX, in an amount
equal to (A) the Uncertificated Accrued Interest for such Distribution
Date, plus (B) any amounts in respect thereof remaining unpaid from
previous Distribution Dates;
(iii) to the Holders of REMIC 1 Regular Interests, in an
amount equal to the remainder of the REMIC 1 Marker Allocation
Percentage of the Interest Remittance Amount and Principal
Remittance Amount for such Distribution Date after the distributions
made pursuant to clause (i) above, allocated as follows:
a. to REMIC 1 Regular Interest LT1AA, 98.00% of such
remainder, until the Uncertificated Principal Balance of such
Uncertificated REMIC 1 Regular Interest is reduced to zero;
b. to REMIC 1 Regular Interest LT1A1, REMIC 1 Regular
Interest LT1A2, REMIC 1 Regular Interest LT1A3, REMIC 1
Regular Interest LT1A4, REMIC 1 Regular Interest LT1A5, REMIC
1 Regular Interest LT1A6, REMIC 1 Regular Interest LT1M1,
REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest
LT1M3, REMIC 1 Regular Interest LT1M4 and REMIC 1 Regular
Interest LT1M5, 1.00% of such remainder, in the same
proportion as principal payments are allocated to the
Corresponding Classes, until the Uncertificated Principal
Balances of such REMIC 1 Regular Interests are reduced to
zero; then
c. to REMIC 1 Regular Interest LT1ZZ, 1.00% of such
remainder, until the Uncertificated Principal Balance of such
REMIC 1 Regular Interest is reduced to zero;
provided, however, that (i) 98.00% and (ii) 2.00% of any
principal payments that are attributable to an Aggregate
Overcollateralization Release Amount shall be allocated
to (i) REMIC 1 Regular Interest LT1AA and (ii) REMIC 1
Regular Interest LT1ZZ, respectively; and
(iv) to the Holders of REMIC 1 Regular Interests, in an amount equal
to the REMIC 1 Sub WAC Allocation Percentage of the Interest Remittance
Amount and Principal Remittance Amount for such Distribution Date after
the distributions made pursuant to clause (i) above, such that
distributions of principal shall be deemed to be made to the REMIC 1
Regular Interest LT1XX.
(b) The Trustee shall cause the following allocation of losses:
(i) The REMIC 1 Marker Allocation Percentage of the aggregate amount
of any Relief Act Reductions incurred in respect of the Mortgage Loans for
any Distribution Date shall be allocated first, to Uncertificated Accrued
Interest payable to REMIC 1 Regular Interest LT1AA and REMIC 1 Regular
Interest LT1ZZ up to an aggregate amount equal to the REMIC 1 Interest
Loss Allocation Amount, 98% and 2%, respectively, and thereafter among
REMIC 1 Regular Interest LT1AA, REMIC 1 Regular Interest LT1A1, REMIC 1
Regular Interest LT1A2, REMIC 1 Regular Interest LT1A3, REMIC 1 Regular
Interest LT1A4, REMIC 1 Regular Interest LT1A5, REMIC 1 Regular Interest
LT1A6, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2,
REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest LT1M4, REMIC 1
Regular Interest LT1M5 and REMIC 1 Regular Interest LT1ZZ, pro rata, based
on, and to the extent of, one month's interest at the then applicable
respective Uncertificated REMIC 1 Pass-Through Rate on the respective
Uncertificated Principal Balance of each such REMIC 1 Regular Interest;
(ii) The REMIC 1 Sub WAC Allocation Percentage of the aggregate
amount of any Relief Act Reductions incurred in respect of the Mortgage
Loans for any Distribution Date shall be allocated to the REMIC 1 Regular
Interest LT1XX;
(iii) The REMIC 1 Marker Allocation Percentage of all Realized
Losses on the Mortgage Loans shall be allocated by the Trustee on each
Distribution Date to the following REMIC 1 Regular Interests in the
specified percentages, as follows: first, to Uncertificated Accrued
Interest payable to REMIC 1 Regular Interest LT1AA and REMIC 1 Regular
Interest LT1ZZ up to an aggregate amount equal to the REMIC 1 Interest
Loss Allocation Amount, 98% and 2%, respectively; second, to the
Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA and
REMIC 1 Regular Interest LT1ZZ up to an aggregate amount equal to the
REMIC 1 Principal Loss Allocation Amount, 98% and 2%, respectively; third,
to the Uncertificated Principal Balances of REMIC 1 Regular Interest
LT1AA, REMIC 1 Regular Interest LT1M5 and REMIC 1 Regular Interest LT1ZZ,
98%, 1% and 1%, respectively, until the Uncertificated Principal Balance
of REMIC 1 Regular Interest LT1M5 has been reduced to zero; fourth, to the
Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC
1 Regular Interest LT1M4 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and
1%, respectively, until the Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M4 has been reduced to zero; fifth to the
Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC
1 Regular Interest LT1M3 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and
1%, respectively, until the Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M3 has been reduced to zero; sixth, to the
Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC
1 Regular Interest LT1M2 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and
1%, respectively, until the Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M2 has been reduced to zero; and seventh, to the
Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC
1 Regular Interest LT1M1 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and
1%, respectively, until the Uncertificated Principal Balances of REMIC 1
Regular Interest LT1M1 has been reduced to zero; and
(iv) The REMIC 1 Sub WAC Allocation Percentage of all Realized
Losses shall be applied after all distributions have been made on each
Distribution Date shall be allocated to REMIC 1 Regular Interest LT1XX.
(c) Notwithstanding anything to the contrary contained herein, the
above distributions in this Section 5.11 (other than on the Certificates) are
deemed distributions, and distributions of funds from the Certificate Account
shall be made only in accordance with Sections 5.02 hereof.
ARTICLE VI
THE CERTIFICATES
Section 6.01 The Certificates. The Classes of Senior Certificates
and the Subordinate Certificates shall be substantially in the forms set forth
in Exhibits A-A-1, X-X-0, X-X-0, X-X-0, X-X-0, X-X-0, X-0, X-0, X-0, X-0, X-0,
X-0, B-7 and C (reverse of all Certificates) and shall, on original issue, be
executed by the Trustee and shall be authenticated and delivered by the Trustee
to or upon the order of the Depositor upon receipt by the Trustee of the
documents specified in Section 2.01. The Classes of Certificates (other than
Class CE and Class R Certificates) shall be available to investors in the
minimum Denominations of initial Certificate Balance and the integral multiples
in excess thereof as set forth in the Preliminary Statement. The Class CE
Certificates are issuable only in minimum Percentage Interests of 10% and
incremental Percentage Interests of 1% in excess thereof. The Class R
Certificate is issuable only as a single certificate. The Offered Certificates
shall initially be issued in book-entry form through the Depository and
delivered to the Depository or, pursuant to the Depository's instructions on
behalf of the Depository to, and deposited with, the Certificate Custodian, and
all other Classes of Certificates shall initially be issued in definitive,
fully-registered form.
The Certificates shall be executed by manual or facsimile signature
on behalf of the Trustee by an authorized officer or signatory. Certificates
bearing the manual or facsimile signatures of individuals who were, at the time
when such signatures were affixed, authorized to sign on behalf of the Trustee
shall bind the Trustee, notwithstanding that such individuals or any of them
have ceased to be so authorized prior to the execution and delivery of such
Certificates or did not hold such offices or positions at the date of such
Certificate. No Certificate shall be entitled to any benefit under this
Agreement, or be valid for any purpose, unless such Certificate shall have been
manually authenticated by the Trustee substantially in the form provided for
herein, and such authentication upon any Certificate shall be conclusive
evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder. All Certificates shall be dated the date
of their authentication.
Section 6.02 Registration of Transfer and Exchange of Certificates.
(a) The Trustee shall cause to be kept at an office or agency in the city in
which the Corporate Trust Office of the Trustee is located a Certificate
Register in which, subject to such reasonable regulations as it may prescribe,
the Trustee shall provide for the registration of Certificates and of transfers
and exchanges of Certificates as herein provided. The Trustee shall initially
serve as Certificate Registrar for the purpose of registering Certificates and
transfers and exchanges of Certificates as herein provided.
(b) At the option of the Certificateholders, Certificates may be
exchanged for other Certificates of authorized Denominations of a like Class,
tenor and aggregate Percentage Interest, upon surrender of the Certificates
to be exchanged at any such office or agency. Whenever any Certificates are
so surrendered for exchange, the Trustee shall execute and the Trustee shall
authenticate and deliver the Certificates which the Certificateholder making
the exchange is entitled to receive. Every Certificate presented or
surrendered for transfer or exchange shall (if so required by the Trustee or
the Certificate Registrar) be duly endorsed by, or be accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by, the Holder thereof or its attorney
duly authorized in writing.
(c) (i) Except as provided in paragraph (c)(iii) below, the
Book-Entry Certificates shall at all times remain registered in the name of
the Depository or its nominee and at all times: (A) registration of the
Certificates may not be transferred by the Trustee except to another
Depository; (B) the Depository shall maintain book-entry records with respect
to the Certificate Owners and with respect to ownership and transfers of such
Book-Entry Certificates; (C) ownership and transfers of registration of the
Book-Entry Certificates on the books of the Depository shall be governed by
applicable rules established by the Depository; (D) the Depository may
collect its usual and customary fees, charges and expenses from its
Depository Participants; (E) the Trustee shall deal with the Depository as
the representative of the Certificate Owners of the Book-Entry Certificates
for purposes of exercising the rights of Holders under this Agreement, and
requests and directions for and votes of the Depository shall not be deemed
to be inconsistent if they are made with respect to different Certificate
Owners; and (F) the Trustee may rely and shall be fully protected in relying
upon information furnished by the Depository with respect to its Depository
Participants and furnished by the Depository Participants with respect to
indirect participating firms and persons shown on the books of such indirect
participating firms as direct or indirect Certificate Owners.
(ii) All transfers by Certificate Owners of Book-Entry Certificates
shall be made in accordance with the procedures established by the
Depository Participant or brokerage firm representing such Certificate
Owner. Each Depository Participant shall only transfer Book-Entry
Certificates of Certificate Owners it represents or of brokerage firms for
which it acts as agent in accordance with the Depository's normal
procedures.
(iii) If the Depository advises the Trustee in writing that the
Depository is no longer willing or able to properly discharge its
responsibilities as Depository and the Trustee or the Depositor is unable
to locate a qualified successor, the Trustee shall notify all Certificate
Owners, through the Depository, of the occurrence of such event and of the
availability of definitive, fully-registered Certificates (the "Definitive
Certificates") to such Certificate Owners requesting the same. Upon
surrender to the Trustee of the related Class of Certificates by the
Depository (or by the Certificate Custodian, if it holds such Class on
behalf of the Depository), accompanied by the instructions from the
Depository for registration, the Trustee shall issue the Definitive
Certificates. None of the Servicer, the Depositor or the Trustee shall be
liable for any delay in delivery of such instruction and may conclusively
rely on, and shall be protected in relying on, such instructions. The
Depositor shall provide the Trustee with an adequate inventory of
certificates to facilitate the issuance and transfer of Definitive
Certificates. Upon the issuance of Definitive Certificates, the Trustee
shall recognize the Holders of the Definitive Certificates as
Certificateholders hereunder.
(d) No transfer of a Private Certificate shall be made unless such
transfer is exempt from the registration requirements of the 1933 Act and any
applicable state securities laws or is made in accordance with the 1933 Act
and such laws. In the event of any such transfer, (i) unless such transfer is
made in reliance on Rule 144A under the 1933 Act, the Trustee or the
Depositor may require a written Opinion of Counsel (which may be in-house
counsel) acceptable to and in form and substance reasonably satisfactory to
the Trustee and the Depositor that such transfer may be made pursuant to an
exemption, describing the applicable exemption and the basis therefor, from
the 1933 Act and such laws or is being made pursuant to the 1933 Act and such
laws, which Opinion of Counsel shall not be an expense of the Trustee or the
Depositor and (ii) the Trustee shall require a certificate from the
Certificateholder desiring to effect such transfer substantially in the form
attached hereto as Exhibit G-1 and a certificate from such
Certificateholder's prospective transferee substantially in the form attached
hereto either as Exhibit G-2A or as Exhibit G-2B, which certificates shall
not be an expense of the Trustee or the Depositor; provided that the
foregoing requirements under clauses (i) and (ii) shall not apply to a
transfer of a Private Certificate between or among the Depositor, the Seller,
their affiliates or both. The Depositor shall provide to any Holder of a
Private Certificate and any prospective transferees designated by any such
Holder, information regarding the related Certificates and the Mortgage Loans
and such other information as shall be necessary to satisfy the condition to
eligibility set forth in Rule 144A(d)(4) for transfer of any such certificate
without registration thereof under the 1933 Act pursuant to the registration
exemption provided by Rule 144A. The Holder of a Private Certificate desiring
to effect such transfer shall, and does hereby agree to, indemnify the
Trustee and the Depositor against any liability that may result if the
transfer is not so exempt or is not made in accordance with such federal and
state laws.
(e) No transfer of an ERISA Restricted Certificate shall be made
unless the transferee delivers to the Trustee either (i) a representation
letter in the form of Exhibit H from the transferee of such Certificate,
which representation letter shall not be an expense of the Depositor, the
Trustee or the Servicer, or (ii) in the case of any ERISA Restricted
Certificate presented for registration in the name of an employee benefit
plan or arrangement, including an individual retirement account, subject to
ERISA, the Code, or any federal, state or local law ("Similar Law") which is
similar to ERISA or the Code (collectively, a "Plan"), or a trustee or
custodian of any of the foregoing, an Opinion of Counsel in form and
substance satisfactory to the Trustee and the Servicer to the effect that the
purchase or holding of such ERISA Restricted Certificate by or on behalf of
such Plan will not constitute or result in a non-exempt prohibited
transaction within the meaning of ERISA, Section 4975 of the Code or Similar
Law and will not subject the Trustee, the Depositor or the Servicer to any
obligation in addition to those undertaken in this Agreement, which Opinion
of Counsel shall not be an expense of the Trustee or the Servicer. Any
transferee of an ERISA Restricted Certificate that does not comply with
either clause (i) or (ii) of the preceding sentence will be deemed to have
made one of the representations set forth in Exhibit H. For purposes of
clause (i) of the second preceding sentence, such representation shall be
deemed to have been made to the Certificate Registrar by the acceptance by a
Certificate Owner of a Book-Entry Certificate of the beneficial interest in
any such Class of ERISA Restricted Certificates, unless the Certificate
Registrar shall have received from the transferee an alternative
representation acceptable in form and substance to the Depositor.
Notwithstanding anything else to the contrary herein, any purported transfer
of an ERISA Restricted Certificate to or on behalf of a Plan without the
delivery to the Trustee and the Servicer of an Opinion of Counsel
satisfactory to the Trustee and the Servicer as described above shall be void
and of no effect.
Neither the Trustee nor the Certificate Registrar shall have any
liability for transfers of Book-Entry Certificates made through the book-entry
facilities of the Depository or between or among any Depository Participants or
Certificate Owners, made in violation of applicable restrictions. The Trustee
may rely and shall be fully protected in relying upon information furnished by
the Depository with respect to its Depository Participants and furnished by the
Depository Participants with respect to indirect participating firms and Persons
shown on the books of such indirect participating firms as direct or indirect
Certificate Owners.
To the extent permitted under applicable law (including, but not
limited to, ERISA), the Trustee shall be under no liability to any Person for
any registration of transfer of any ERISA Restricted Certificate that is in fact
not permitted by this Section 6.02 or for making any payments due on such
Certificate to the Holder thereof or taking any other action with respect to
such Holder under the provisions of this Agreement so long as the transfer was
registered by the Trustee in accordance with the foregoing requirements.
(f) Each Person who has or who acquires any Ownership Interest in
the Residual Certificate shall be deemed by the acceptance or acquisition of
such Ownership Interest to have agreed to be bound by the following
provisions, and the rights of each Person acquiring any Ownership Interest in
the Residual Certificate are expressly subject to the following provisions:
(i) Each Person holding or acquiring any Ownership Interest in the
Residual Certificate shall be a Permitted Transferee and shall promptly
notify the Trustee of any change or impending change in its status as a
Permitted Transferee.
(ii) No Person shall acquire an Ownership Interest in the Residual
Certificate unless such Ownership Interest is a pro rata undivided
interest.
(iii) In connection with any proposed transfer of any Ownership
Interest in the Residual Certificate, the Trustee shall require delivery
to it, in form and substance satisfactory to it, of an affidavit in the
form of Exhibit I hereto from the proposed transferee.
(iv) Notwithstanding the delivery of an affidavit by a proposed
transferee under clause (iii) above, if a Responsible Officer of the
Trustee has actual knowledge that the proposed transferee is not a
Permitted Transferee, no transfer of any Ownership Interest in the
Residual Certificate to such proposed transferee shall be effected.
(v) No Ownership Interest in the Residual Certificate may be
purchased by or transferred to any Person that is not a U.S. Person,
unless (A) such Person holds the Residual Certificate in connection with
the conduct of a trade or business within the United States and furnishes
the transferor and the Trustee with an effective Internal Revenue Service
Form W-8ECI (or successor thereto) or (B) the transferee delivers to both
the transferor and the Trustee an Opinion of Counsel from a
nationally-recognized tax counsel to the effect that such transfer is in
accordance with the requirements of the Code and the regulations
promulgated thereunder and that such transfer of the Residual Certificate
will not be disregarded for federal income tax purposes.
(vi) Any attempted or purported transfer of any Ownership Interest
in the Residual Certificate in violation of the provisions of this Section
6.02 shall be absolutely null and void and shall vest no rights in the
purported transferee. If any purported transferee shall, in violation of
the provisions of this Section 6.02, become a Holder of the Residual
Certificate, then the prior Holder of the Residual Certificate that is a
Permitted Transferee shall, upon discovery that the registration of
transfer of the Residual Certificate was not in fact permitted by this
Section 6.02, be restored to all rights as Holder thereof retroactive to
the date of registration of transfer of the Residual Certificate. The
Trustee shall be under no liability to any Person for any registration of
transfer of the Residual Certificate that is in fact not permitted by this
Section 6.02 or for making any distributions due on the Residual
Certificate to the Holder thereof or taking any other action with respect
to such Holder under the provisions of the Agreement so long as the
transfer was registered in accordance with this Section 6.02. The Trustee
shall be entitled to recover from any Holder of the Residual Certificate
that was in fact not a Permitted Transferee at the time such distributions
were made all distributions made on the Residual Certificate. Any such
distributions so recovered by the Trustee shall be distributed and
delivered by the Trustee to the prior Holder of the Residual Certificate
that is a Permitted Transferee.
(vii) If any Person other than a Permitted Transferee acquires any
Ownership Interest in the Residual Certificate in violation of the
restrictions in this Section 6.02, then the Trustee, based on information
provided to the Trustee by the Servicer, will provide to the Internal
Revenue Service, and to the Persons specified in Section 860E(e)(3) and
(6) of the Code, information needed to compute the tax imposed under
Section 860E(e) of the Code on transfers of residual interests to
disqualified organizations. The expenses of the Trustee under this clause
(vii) shall be reimbursable by the Trust.
(viii) No Ownership Interest in the Residual Certificate shall be
acquired by a Plan or any Person acting on behalf of a Plan.
(g) No service charge shall be imposed for any transfer or exchange
of Certificates of any Class, but the Trustee may require 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.
(h) All Certificates surrendered for transfer and exchange shall be
destroyed by the Certificate Registrar.
Section 6.03 Mutilated, Destroyed, Lost or Stolen Certificates. If
(a) any mutilated Certificate is surrendered to the Certificate Registrar or the
Certificate Registrar receives evidence to its satisfaction of the destruction,
loss or theft of any Certificate, and (b) there is delivered to the Trustee, the
Depositor and the Certificate Registrar such security or indemnity reasonably
satisfactory to each, to save each of them harmless, then, in the absence of
actual notice to the Trustee or the Certificate Registrar that such Certificate
has been acquired by a bona fide purchaser, the Trustee shall authenticate and
deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or
stolen Certificate, a new Certificate of like tenor, Class and Percentage
Interest but bearing a number not contemporaneously outstanding. Upon the
issuance of any new Certificate under this Section, the Trustee may require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in relation thereto and any other expenses (including the fees
and expenses of the Trustee and the Certificate Registrar) connected therewith.
Any duplicate Certificate issued pursuant to this Section shall constitute
complete and indefeasible evidence of ownership in the Trust, 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, the Depositor, the Servicer, the
Trustee, the Certificate Registrar and any agent of the Depositor, the Servicer,
the Trustee or the Certificate Registrar may treat the Person in whose name any
Certificate is registered as the owner of such Certificate for the purpose of
receiving distributions pursuant to Section 5.01 and for all other purposes
whatsoever, and none of the Depositor, the Servicer, the Trustee, the
Certificate Registrar or any agent of the Servicer, the Trustee or the
Certificate Registrar shall be affected by notice to the contrary.
ARTICLE VII
THE DEPOSITOR AND THE SERVICER
Section 7.01 Respective Liabilities of the Depositor and the
Servicer. The Depositor and the Servicer shall each be liable in accordance
herewith only to the extent of the obligations specifically and respectively
imposed upon and undertaken by the Depositor and the Servicer herein. By way of
illustration and not limitation, the Depositor is not liable for the servicing
and administration of the Mortgage Loans, nor is it obligated by Section 8.01 to
assume any obligations of the Servicer or to appoint a designee to assume such
obligations, nor is it liable for any other obligation hereunder that it may,
but is not obligated to, assume unless it elects to assume such obligation in
accordance herewith.
Section 7.02 Merger or Consolidation of the Depositor or the
Servicer. The Depositor and the Servicer will each keep in full effect its
existence, rights and franchises as a separate entity under the laws governing
its organization, and will 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, the Certificates or any of the Mortgage Loans
and to perform its respective duties under this Agreement.
Any Person into which the Depositor or the Servicer may be merged or
consolidated, or any corporation resulting from any merger or consolidation to
which the Depositor or the Servicer shall be a party, or any Person succeeding
to the business of the Depositor or the Servicer, shall be the successor of the
Depositor or the 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
(a) the successor or surviving Person to the Servicer shall be qualified to
service mortgage loans on behalf of Xxxxxx Xxx or Xxxxxxx Mac and (b) the
Servicer and such successor or surviving Person shall notify the Depositor and
the Trustee of any such merger, conversion or consolidation at least two
Business Days prior to the effective date thereof and shall provide the
Depositor and the Trustee with all information required by the Depositor to
comply with its reporting obligation under Item 6.02 of Form 8-K not later than
the effective date of such merger, conversion or consolidation.
Section 7.03 Limitation on Liability of the Depositor, the Servicer
and Others. None of the Depositor, the Servicer or any of the directors,
officers, employees or agents of the Depositor or of the Servicer shall be under
any liability to the Trust Estate or 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 Servicer or any such Person against any
breach of warranties or representations made herein or any liability which would
otherwise be imposed by reason 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 Servicer and any director,
officer, employee or agent of the Depositor or the 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 Servicer
and any director, officer, employee or agent of the Depositor or the Servicer
shall be indemnified by the Trust Estate 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
related to any specific Mortgage Loan or Mortgage Loans (except as any such
loss, liability or expense shall be otherwise reimbursable pursuant to this
Agreement) and any loss, liability or expense incurred by reason of willful
misfeasance, bad faith or gross negligence in the performance of duties
hereunder or by reason of reckless disregard of obligations and duties
hereunder. Neither of the Depositor nor the Servicer shall be under any
obligation to appear in, prosecute or defend any legal action which is not
incidental to its respective duties under this Agreement and which in its
opinion may involve it in any expense or liability; provided, however, that the
Depositor or the Servicer may in its discretion undertake any such action which
it may deem necessary or desirable in respect to this Agreement and the rights
and duties of the parties hereto and the interests of the Certificateholders
hereunder. In such event, the legal expenses and costs of such action and any
liability resulting therefrom shall be expenses, costs and liabilities of the
Trust Estate, and the Depositor and the Servicer shall be entitled to be
reimbursed therefor out of amounts attributable to the Mortgage Loans on deposit
in the Servicer Custodial Account as provided by Section 3.11.
Section 7.04 Depositor and Servicer Not to Resign. Subject to the
provisions of Section 7.02, neither the Depositor nor the Servicer shall resign
from its respective obligations and duties hereby imposed on it except upon
determination that its duties hereunder are no longer permissible under
applicable law or, in the case of the Servicer, pursuant to Section 7.05. Any
such determination permitting the resignation of the Depositor or the Servicer
shall be evidenced by an Opinion of Counsel to such effect delivered to the
Trustee. No such resignation by the Servicer shall become effective until the
Trustee or a successor Servicer shall have assumed the Servicer's
responsibilities and obligations in accordance with Section 8.05 hereof.
Section 7.05 Assignment or Delegation of Duties by the Servicer. The
Servicer shall have the right to assign its rights and delegate its duties and
obligations hereunder; provided, however, that (i) the purchaser or transferee
accepting such assignment or delegation is qualified to service mortgage loans
for Xxxxxx Xxx or Xxxxxxx Mac, is satisfactory to the Trustee, in the exercise
of its reasonable judgment, and executes and delivers to the Trustee an
agreement, in form and substance reasonably satisfactory to the Trustee, which
contains an assumption by such purchaser or transferee of the due and punctual
performance and observance of each covenant and condition to be performed or
observed by the Servicer hereunder from and after the date of such agreement;
and (ii) each applicable Rating Agency's rating of any Certificates in effect
immediately prior to such assignment, sale or transfer is not reasonably likely
to be qualified, downgraded or withdrawn as a result of such assignment, sale or
transfer and the Certificates are not reasonably likely to be placed on credit
review status by any such Rating Agency. In no case, however, shall any
permitted assignment and delegation relieve the Servicer of any liability to the
Trustee or the Depositor under this Agreement, incurred by it prior to the time
that the conditions contained in clauses (i) and (ii) above are met.
ARTICLE VIII
DEFAULT
Section 8.01 Events of Default. If any one of the following events
("Events of Default") shall occur and be continuing:
(a) any failure by the Servicer to deposit amounts in the Servicer
Custodial Account in the amount and manner provided herein so as to enable
the Trustee to distribute to Holders of Certificates any payment required to
be made under the terms of such Certificates and this Agreement (other than
the payments required to be made under Section 3.20) which continues
unremedied for a period of five days; or
(b) failure on the part of the Servicer duly to observe or perform
in any material respect any other covenants or agreements of the Servicer set
forth in the Certificates or in this Agreement, which covenants and
agreements continue unremedied for a period of 30 days after the date on
which written notice of such failure, requiring the same to be remedied,
shall have been given to the Servicer by the Trustee or the Depositor, or to
the Servicer, the Depositor and the Trustee by the Holders of Certificates
evidencing Voting Rights aggregating not less than 25% of all Certificates
affected thereby; or
(c) the entry of a decree or order by a court or agency or
supervisory authority having jurisdiction in the premises for the appointment
of a conservator, receiver or liquidator in any insolvency, readjustment of
debt, marshalling of assets and liabilities or similar proceedings against
the Servicer, or for the winding up or liquidation of the Servicer's affairs,
and the continuance of any such decree or order unstayed and in effect for a
period of 60 consecutive days; or
(d) the consent by the Servicer 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 Servicer or of or relating to substantially all of its property; or
the Servicer shall admit in writing its inability to pay its debts generally
as they become due, file a petition to take advantage of any applicable
insolvency or reorganization statute, make an assignment for the benefit of
its creditors, or voluntarily suspend payment of its obligations; or
(e) the failure of the Servicer to remit any Periodic Advance
required to be remitted by the Servicer pursuant to Section 3.20 which
failure continues unremedied at 3:00 p.m. on the related Distribution Date;
then, and in each and every such case (other than the Event of Default
described in clause (e) hereof), so long as an Event of Default shall not
have been remedied by the Servicer, the Trustee may, and at the direction of
the Holders of Certificates evidencing Voting Rights aggregating not less
than 51% of all Certificates affected thereby shall, by notice then given in
writing to the Servicer (and to the Depositor), terminate all of the rights
and obligations of the Servicer under this Agreement. If an Event of Default
described in clause (e) hereof shall occur, the Trustee shall, by notice to
the Servicer, terminate all of the rights and obligations of the Servicer
under this Agreement and in and to the Mortgage Loans and proceeds thereof
(other than the Servicer's right to recovery of the aggregate Servicing Fees
due prior to the date of termination and other expenses and amounts advanced
pursuant to the terms of this Agreement, which rights the Servicer will
retain under all circumstances) and the Trustee or a successor Servicer
appointed pursuant to Section 8.05 shall make the Advance which the Servicer
failed to make. On or after the receipt by the Servicer of such written
notice, all authority and power of the Servicer under this Agreement, whether
with respect to the Certificates or the Mortgage Loans or otherwise, shall
pass to and be vested in the Trustee pursuant to and under this Section 8.01,
unless and until such time as the Trustee shall appoint a successor Servicer
pursuant to Section 8.05, and, without limitation, the Trustee is hereby
authorized and empowered to execute and deliver, on behalf of the Servicer,
as attorney-in-fact or otherwise, any and all documents and other
instruments, and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such notice of termination, whether to
complete the transfer and endorsement of the Mortgage Loans and related
documents, or otherwise, including, without limitation, the recordation of
the assignments of the Mortgage Loans to it. The Servicer agrees to cooperate
with the Trustee in effecting the termination of the responsibilities and
rights of the Servicer hereunder, including, without limitation, the transfer
to the Trustee for the administration by it of all cash amounts that have
been deposited by the Servicer in the Servicer Custodial Account or
thereafter received by the Servicer with respect to the Mortgage Loans. Upon
obtaining notice or knowledge of the occurrence of any Event of Default, the
Person obtaining such notice or knowledge shall give prompt written notice
thereof to Certificateholders at their respective addresses appearing in the
Certificate Register and to each Rating Agency. All costs and expenses
(including attorneys' fees) incurred in connection with transferring the
Mortgage Files to the successor Servicer and amending this Agreement to
reflect such succession as Servicer pursuant to this Section 8.01 shall be
paid by the predecessor Servicer. Notwithstanding the termination of the
Servicer pursuant hereto, the Servicer shall remain liable for any causes of
action arising out of any Event of Default occurring prior to such
termination.
Section 8.02 Remedies of Trustee. During the continuance of any
Event of Default, so long as such Event of Default shall not have been remedied,
the Trustee, in addition to the rights specified in Section 8.01, shall have the
right, in its own name as trustee of an express trust, to take all actions now
or hereafter existing at law, in equity or by statute to enforce its rights and
remedies and to protect the interests, and enforce the rights and remedies, of
the Certificateholders (including the institution and prosecution of all
judicial, administrative and other proceedings and the filing of proofs of claim
and debt in connection therewith). Except as otherwise expressly provided in
this Agreement, no remedy provided for by this Agreement shall be exclusive of
any other remedy, and each and every remedy shall be cumulative and in addition
to any other remedy and no delay or omission to exercise any right or remedy
shall impair any such right or remedy or shall be deemed to be a waiver of any
Event of Default.
Section 8.03 Directions by Certificateholders and Duties of Trustee
During Event of Default. During the continuance of any Event of Default, Holders
of Certificates evidencing Voting Rights aggregating not less than 25% of each
Class of Certificates affected thereby may direct 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; provided,
however, that the Trustee shall be under no obligation to pursue any such
remedy, or to exercise any of the trusts or powers vested in it by this
Agreement (including, without limitation, (a) the conducting or defending of any
administrative action or litigation hereunder or in relation hereto, and (b) the
terminating of the Servicer or any successor Servicer from its rights and duties
as servicer hereunder) at the request, order or direction of any of the
Certificateholders, 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; and, provided, further,
that, subject to the provisions of Section 9.01, the Trustee shall have the
right to decline to follow any such direction if the Trustee, based upon an
Opinion of Counsel, determines that the action or proceeding so directed may not
lawfully be taken or if the Trustee in good faith determines that the action or
proceeding so directed would involve it in personal liability or be unjustly
prejudicial to the non-assenting Certificateholders.
Section 8.04 Action upon Certain Failures of the Servicer and upon
Event of Default. In the event that the Trustee shall have actual knowledge of
any failure of the Servicer specified in Section 8.01(a) or (b) which would
become an Event of Default upon the Servicer's failure to remedy the same after
notice, the Trustee shall give notice thereof to the Servicer. If the Trustee
shall have knowledge of an Event of Default, the Trustee shall give prompt
written notice thereof to the Certificateholders.
Section 8.05 Trustee to Act; Appointment of Successor. (a) Within 90
days after the time the Servicer receives a notice of termination pursuant to
Section 8.01, the Trustee shall be the successor in all respects to the Servicer
in its capacity as servicer under this Agreement and the transactions set forth
or provided for herein and shall be subject to all the responsibilities, duties
and liabilities relating thereto placed on the Servicer by the terms and
provisions hereof or shall appoint a successor pursuant to Section 3.07.
Notwithstanding the foregoing (i) the parties hereto agree that the Trustee, in
its capacity as successor Servicer, immediately will assume all of the
obligations of the Servicer to make Advances, (ii) the Trustee in its capacity
as successor Servicer, shall not be responsible for the lack of information
and/or documents that it cannot obtain through reasonable efforts and (iii)
under no circumstances shall any provision of this Agreement be construed to
require the Trustee, acting in its capacity as successor to the Servicer in its
obligation to make Advances, to advance, expend or risk its own funds or
otherwise incur any financial liability in the performance of its duties
hereunder if it shall have reasonable grounds for believing that such funds are
non-recoverable. Subject to Section 8.05(b), as compensation therefor, the
Trustee shall be entitled to such compensation as the terminated Servicer would
have been entitled to hereunder if no such notice of termination had been given.
Notwithstanding the above, the Trustee may, if it shall be unwilling so to act,
or shall, if it is legally unable so to act, appoint, or petition a court of
competent jurisdiction to appoint, any established housing and home finance
institution having a net worth of not less than $10,000,000 as the successor to
the terminated Servicer hereunder in the assumption of all or any part of the
responsibilities, duties or liabilities of the Servicer hereunder; provided,
however, that any such institution appointed as successor Servicer shall not, as
evidenced in writing by each Rating Agency, adversely affect the then current
rating of any Class of Certificates immediately prior to the termination of the
terminated Servicer. The appointment of a successor Servicer shall not affect
any liability of the predecessor Servicer which may have arisen under this
Agreement prior to its termination as Servicer, nor shall any successor Servicer
be liable for any acts or omissions of the predecessor Servicer or for any
breach by the Servicer of any of its representations or warranties contained
herein or in any related document or agreement. Pending appointment of a
successor to the terminated Servicer hereunder, unless the Trustee is prohibited
by law from so acting, the Trustee shall act in such capacity as provided above.
The Trustee and such successor shall take such action, consistent with this
Agreement, as shall be necessary to effectuate any such succession. All
Servicing Transfer Costs shall be paid by the predecessor Servicer upon
presentation of reasonable documentation of such costs, and if such predecessor
Servicer defaults in its obligation to pay such costs, such costs shall be paid
by the successor Servicer or the Trustee (in which case the successor Servicer
or the Trustee shall be entitled to reimbursement therefor from the assets of
the Trust).
(b) In connection with the appointment of a successor Servicer or
the assumption of the duties of the Servicer, as specified in Section
8.05(a), the Trustee may make such arrangements for the compensation of such
successor out of the payments on the Mortgage Loans serviced by the
predecessor Servicer as it and such successor shall agree, not to exceed the
Servicing Fee Rate.
(c) Any successor, including the Trustee, to the Servicer as
servicer shall during the term of its service as servicer maintain in force
(i) a policy or policies of insurance covering errors and omissions in the
performance of its obligations as servicer hereunder and (ii) a fidelity bond
in respect of its officers, employees and agents to the same extent as the
Servicer is so required pursuant to Section 3.03.
(d) The predecessor Servicer and successor Servicer shall notify the
Depositor and Trustee of any such appointment at least two Business Days
prior to the effective date thereof and shall provide the Depositor and the
Trustee with all information required by the Depositor to comply with its
reporting obligation under Item 6.02 of Form 8-K not later than the effective
date of such appointment.
Section 8.06 Notification to Certificateholders. Upon any
termination or appointment of a successor to the Servicer pursuant to this
Article VIII, the Trustee shall give prompt written notice thereof to
Certificateholders at their respective addresses appearing in the Certificate
Register and to each Rating Agency.
ARTICLE IX
THE TRUSTEE
Section 9.01 Duties of Trustee. (a) The Trustee, prior to the
occurrence of an Event of Default and after the curing or waiver of all Events
of Default which may have occurred, undertakes to perform such duties and only
such duties as are specifically set forth in this Agreement. In case an Event of
Default has occurred of which a Responsible Officer of the Trustee shall have
actual knowledge (which has not been cured or waived), 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 its exercise as a reasonably prudent
investor would exercise or use under the circumstances in the conduct of such
investor's own affairs.
The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee which 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.
(b) No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own grossly negligent action, its own grossly
negligent failure to act or its own willful misfeasance; provided, however,
that:
(i) Prior to the occurrence of an Event of Default, and after the
curing or waiver of all such Events of Default which 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 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, in
the absence of bad faith on the part of the Trustee, 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 by the Depositor or the Servicer and which on
their face, do not contradict the requirements of this Agreement;
(ii) The Trustee (in its individual capacity) 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 it
shall be proved that the Trustee was grossly negligent in ascertaining the
pertinent facts;
(iii) The Trustee (in its individual capacity) 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 the direction of
Certificateholders as provided in Section 8.03;
(iv) The Trustee shall not be charged with knowledge of any default
(other than a default in payment to the Trustee) specified in clauses (a)
and (b) of Section 8.01 or an Event of Default under clauses (c), (d) and
(e) of Section 8.01 unless a Responsible Officer of the Trustee assigned
to and working in the Corporate Trust Office obtains actual knowledge of
such failure or event or any officer of the Trustee receives written
notice of such failure or event at its Corporate Trust Office from the
Servicer, the Depositor or any Certificateholder; and
(v) Except to the extent provided in Section 8.05, no provision in
this Agreement shall require the Trustee to expend or risk its own funds
(including, without limitation, the making of any Advance as successor
Servicer) or otherwise incur any personal financial liability in the
performance of any of its duties as Trustee hereunder, or in the exercise
of any of its rights or powers, if the Trustee shall have reasonable
grounds for believing that repayment of funds or adequate indemnity
against such risk or liability is not reasonably assured to it.
Section 9.02 Certain Matters Affecting the Trustee. 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 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 and any Opinion of Counsel
shall be full and complete authorization and protection in respect of any
action taken or suffered or omitted by it hereunder in good faith and in
accordance with such Opinion of Counsel;
(iii) The Trustee shall 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 (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 investor would exercise or use under the
circumstances in the conduct of such investor'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 waiving of all Events of Default which 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 of any Class evidencing, as to such Class,
Percentage Interests, aggregating not less than 50%; 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 or payment of such estimated expenses as a condition to so
proceeding; and
(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.
Section 9.03 Trustee Not Liable for Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates (other than the execution
of, and the authentication of the Certificates) shall be taken as the statements
of the Depositor or Servicer, as applicable, and the Trustee assumes no
responsibility for their correctness. The Trustee makes no representations as to
the validity or sufficiency of this Agreement or of the Certificates or any
Mortgage Loans save that the Trustee represents that, assuming due execution and
delivery by the other parties hereto, this Agreement has been duly authorized,
executed and delivered by it and constitutes its legal, valid and binding
obligation, enforceable against it in accordance with its terms, subject, as to
enforcement of remedies, to applicable insolvency, receivership, moratorium and
other laws affecting the rights of creditors generally, and to general
principles of equity and the discretion of the court (regardless of whether
enforcement of such remedies is considered in a proceeding in equity or at law).
The Trustee shall not be accountable for the use or application by the Depositor
of funds paid to the Depositor in consideration of the assignment of the
Mortgage Loans hereunder by the Depositor, or for the use or application of any
funds paid to Subservicers or the Servicer in respect of the Mortgage Loans or
deposited into the Servicer Custodial Account, or any other account hereunder
(other than the Certificate Account) by the Servicer.
The Trustee shall at no time have any responsibility or liability
for or with respect to the legality, validity and enforceability of any Mortgage
or any Mortgage Loan, or the perfection and priority of any Mortgage or the
maintenance of any such perfection and priority or for or with respect to the
sufficiency of the Trust or its ability to generate the payments to be
distributed to Certificateholders under this Agreement, including, without
limitation: the existence, condition and ownership of any Mortgaged Property;
the existence and enforceability of any hazard insurance thereon (other than if
the Trustee shall assume the duties of the Servicer pursuant to Section 8.05 and
thereupon only for the acts or omissions of the successor Servicer); the
validity of the assignment of any Mortgage Loan to the Trustee or of any
intervening assignment; the completeness of any Mortgage Loan; the performance
or enforcement of any Mortgage Loan (other than if the Trustee shall assume the
duties of the Servicer pursuant to Section 8.05 and thereupon only for the acts
or omissions of the Trustee as successor Servicer); the compliance by the
Depositor or the Servicer with any warranty or representation made under this
Agreement or in any related document or the accuracy of any such warranty or
representation; any investment of monies by or at the direction of the Servicer
or any loss resulting therefrom, it being understood that the Trustee shall
remain responsible for any Trust property that it may hold in its individual
capacity; the acts or omissions of any of the Depositor, the Servicer (other
than if the Trustee shall assume the duties of the Servicer pursuant to Section
8.05 and thereupon only for the acts or omissions of the Trustee as successor
Servicer), any Subservicer or any Mortgagor; any action of the Servicer (other
than if the Trustee shall assume the duties of the Servicer pursuant to Section
8.05 and thereupon only for the acts or omissions of the Trustee as successor
Servicer) or any Subservicer taken in the name of the Trustee; the failure of
the Servicer or any Subservicer to act or perform any duties required of it as
agent of the Trustee hereunder; or any action by the Trustee taken at the
instruction of the Servicer (other than if the Trustee shall assume the duties
of the Servicer pursuant to Section 8.05 and thereupon only for the acts or
omissions of the Trustee as successor Servicer); provided, however, that the
foregoing shall not relieve the Trustee of its obligation to perform its duties
under this Agreement, including, without limitation, the Trustee's review of the
Mortgage Files pursuant to Section 2.02. The Trustee shall file any financing or
continuation statement in any public office at any time required to maintain the
perfection of any security interest or lien granted to it hereunder.
Section 9.04 Trustee May Own Certificates. The Trustee in its
individual or any other capacity may become the owner or pledgee of Certificates
with the same rights it would have if it were not Trustee and may otherwise deal
with the Servicer, any Subservicer or any of their respective affiliates with
the same rights it would have if it were not the Trustee.
Section 9.05 Eligibility Requirements for Trustee. The Trustee
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 the United States of America or of any
State, authorized under such laws to exercise corporate trust powers, having a
combined capital and surplus of not less than $50,000,000 and subject to
supervision or examination by Federal or State authority and (c) with respect to
every successor trustee hereunder either an institution (i) the long-term
unsecured debt obligations of which are rated at least "A" by S&P and at least
"A2" by Xxxxx'x or (ii) whose serving as Trustee hereunder would not result in
the lowering of the ratings originally assigned to any Class of Certificates.
The Trustee shall not be an affiliate of the Depositor or the Servicer. 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 9.05, the combined
capital and surplus of such corporation or banking 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 provision of this Section 9.05, the Trustee
shall resign immediately in the manner and with the effect specified in Section
9.06.
Section 9.06 Resignation and Removal of Trustee. The Trustee may at
any time resign and be discharged from the trust hereby created by giving
written notice thereof to the Servicer and mailing a copy of such notice to all
Holders of record. The Trustee shall also mail a copy of such notice of
resignation to each Rating Agency. Upon receiving such notice of resignation,
the Servicer shall use its best efforts to promptly appoint a mutually
acceptable successor Trustee by written instrument, in duplicate, one copy of
which instrument shall be delivered to the resigning Trustee and one copy to the
successor Trustee. If no successor Trustee shall have been so appointed and
shall have accepted appointment within 30 days after the giving of such notice
of resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee.
If at any time the Trustee shall cease to be eligible in accordance
with the provisions of Section 9.05 and shall fail to resign after written
request therefor by the Servicer, 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, then the Servicer
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 so
removed and one copy to the successor.
The Holders of Certificates evidencing not less than 50% of the
Voting Rights may at any time remove the Trustee by written instrument or
instruments delivered to the Servicer and the Trustee; the Servicer shall
thereupon use its best efforts to appoint a mutually acceptable successor
Trustee in accordance with this Section 9.06.
Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to any of the provisions of this Section 9.06 shall
become effective upon acceptance of appointment by the successor Trustee as
provided in Section 9.07.
Section 9.07 Successor Trustee. Any successor Trustee appointed as
provided in Section 9.06 shall execute, acknowledge and deliver to the Servicer
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 like effect as if originally
named as Trustee herein. The predecessor Trustee shall duly assign, transfer,
deliver and pay over to the successor Trustee the whole of the Mortgage Files
and related documents and statements held by it hereunder, together with all
instruments of transfer and assignment or other documents properly executed as
may be reasonably required to effect such transfer and such of the records or
copies thereof maintained by the predecessor Trustee in the administration
hereof as may be reasonably requested by the successor Trustee and shall
thereupon be discharged from all duties and responsibilities under this
Agreement (other than pursuant to Section 3.19 hereunder). All costs associated
with the appointment of a successor Trustee shall be paid to the Person that
incurred them by the predecessor Trustee. Without limiting the predecessor
Trustee's obligation, if the predecessor Trustee fails to pay such costs, such
costs shall be reimbursed by the Trust; provided, however, that if the
predecessor Trustee has been terminated pursuant to the third paragraph of
Section 9.06, all reasonable expenses incurred in complying with this Section
9.07 shall be reimbursed by the Trust to the Person that incurred them.
No successor Trustee shall accept appointment as provided in this
Section 9.07 unless at the time of such appointment such successor Trustee shall
be eligible under the provisions of Section 9.05.
Upon acceptance of appointment by a successor Trustee as provided in
this Section 9.07, the Servicer shall cooperate to mail notice of the succession
of such Trustee hereunder to all Holders of Certificates at their addresses as
shown in the Certificate Register and to each Rating Agency. If the Servicer
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 Servicer.
The predecessor Trustee and successor Trustee shall notify the
Depositor of any such appointment at least two Business Days prior to the
effective date thereof and shall provide the Depositor with all information
required by the Depositor to comply with its reporting obligation under Item
6.02 of Form 8-K not later than the effective date of such appointment.
Section 9.08 Merger or Consolidation of Trustee. Any corporation or
banking association into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation or banking association
resulting from any merger, conversion or consolidation to which the Trustee
shall be a party, or any corporation or banking association succeeding to all or
substantially all of the corporate trust business of the Trustee, shall be the
successor of the Trustee hereunder, if such corporation or banking association
is eligible under the provisions of Section 9.05, 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
Trustee and such surviving Person shall notify the Depositor of any such merger,
conversion or consolidation and shall provide the Depositor with all information
required by the Depositor to comply with its reporting obligation under Item
6.02 of Form 8-K not later than the effective date of such merger, conversion or
consolidation.
Section 9.09 Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any of the provisions hereof, at any time, for the purpose of
meeting any legal requirements of any jurisdiction in which any Mortgaged
Property may at the time be located or for any other reason, the 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 as
co-trustee or separate trustee of all or any part of the Trust Estate, and to
vest in such Person or Persons, in such capacity, such title to the Trust
Estate, or any part thereof, and, subject to the other provision of this Section
9.09, such powers, duties, obligations, rights and trusts as the Servicer and
the Trustee may consider necessary or desirable. If the Servicer shall not have
joined in such appointment within ten days after the receipt by it of a request
to do so, 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 9.05 and no notice to Holders
of Certificates of the appointment of co-trustee(s) or separate trustee(s) shall
be required under Section 9.07.
In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 9.09, all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly, except to the extent that under any law of any jurisdiction in which
any particular act or acts are to be performed (whether as Trustee hereunder or
as successor to the Servicer hereunder), the Trustee shall be incompetent or
unqualified to perform such act or acts, in which event such rights, powers,
duties and obligations (including the holding of title to the Trust Estate or
any portion thereof in any such jurisdiction) shall be exercised and performed
by such separate trustee or co-trustee at the direction of the Trustee. No
trustee hereunder shall be held personally liable by reason of any act or
omission of any other trustee hereunder; provided, however, that no appointment
of a co-trustee or separate trustee hereunder shall relieve the Trustee of its
obligations hereunder.
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.
Any separate trustee or co-trustee may, at any time, constitute the
Trustee, its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall become incapable of acting, resign or be removed, or shall be adjudged
bankrupt or insolvent, or a receiver of its property shall be appointed, or any
public officer shall take charge or control of such trustee or co-trustee or of
its property or affairs for the purpose of rehabilitation, conservation or
liquidation, 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 9.10 Authenticating Agents. The Trustee may appoint one or
more authenticating agents ("Authenticating Agents") which shall be authorized
to act on behalf of the Trustee in authenticating Certificates. Initially, the
Authenticating Agent shall be Xxxxx Fargo Bank, N.A. Wherever reference is made
in this Agreement to the authentication of Certificates by the Trustee or the
Trustee's certificate of authentication, such reference shall be deemed to
include authentication on behalf of the Trustee by an Authenticating Agent and a
certificate of authentication executed on behalf of the Trustee by an
Authenticating Agent. Each Authenticating Agent must be acceptable to the
Servicer and must be a corporation or banking association organized and doing
business under the laws of the United States of America or of any state, having
a place of business in New York, New York, having a combined capital and surplus
of at least $15,000,000, authorized under such laws to do a trust business and
subject to supervision or examination by federal or state authorities.
Any corporation or banking association into which any Authenticating
Agent may be merged or converted or with which it may be consolidated, or any
corporation or banking association resulting from any merger, conversion or
consolidation to which any Authenticating Agent shall be a party, or any
corporation or banking association succeeding to the corporate agency business
of any Authenticating Agent, shall continue to be the Authenticating Agent
without the execution or filing of any paper or any further act on the part of
the Trustee or the Authenticating Agent.
Any Authenticating Agent may at any time resign by giving written
notice of resignation to the Trustee and to the Servicer. The Trustee may at any
time terminate the agency of any Authenticating Agent by giving written notice
of termination to such Authenticating Agent and to the Servicer. Upon receiving
a notice of resignation or upon such a termination, or in case, at any time any
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section 9.10, the Trustee may appoint a successor
Authenticating Agent, shall give written notice of such appointment to the
Servicer and shall mail notice of such appointment to all Certificateholders.
Any successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers, duties and responsibilities of
its predecessor hereunder, with like effect as if originally named as
Authenticating Agent.
Section 9.11 Trustee's Fees and Expenses. The Trustee, as
compensation for its activities hereunder, shall be entitled to receive on each
Distribution Date an amount equal to the Trustee Fee for such Distribution Date
pursuant to Section 5.02(a). The Trustee and any director, officer, employee or
agent of the Trustee shall be indemnified by the Trust and held harmless against
any loss, liability or expense (including reasonable attorney's fees) (a)
incurred in connection with any claim or legal action relating to (i) this
Agreement, (ii) the Certificates, or (iii) the performance of any of the
Trustee's duties hereunder, other than any loss, liability or expense incurred
by reason of willful misfeasance, bad faith or gross negligence in the
performance of any of the Trustee's duties hereunder, (b) resulting from any tax
or information return which was prepared by, or should have been prepared by,
the Servicer and (c) arising out of the transfer of any ERISA Restricted
Certificate or Residual Certificate not in compliance with ERISA. Such indemnity
shall survive the termination of this Agreement or the resignation or removal of
the Trustee hereunder. Without limiting the foregoing, 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 gross
negligence, bad faith or willful misconduct, the Trust shall 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 to the
extent permitted by Treasury Regulations Section 1.860G-1(b)(3)(ii) and (iii);
provided, however, that the Depositor and the Trustee intend to enter into a
separate agreement for custody-related services. 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, Certificate Registrar or Paying Agent hereunder or for any
other expenses.
Section 9.12 Appointment of Custodian. The Trustee may at any time
on or after the Closing Date, with the consent of the Depositor and the
Servicer, appoint one or more Custodians to hold all or a portion of the
Mortgage Files as agent for the Trustee, by entering into a custodial agreement
in a form acceptable to the Depositor and the Servicer. Subject to this Article
IX, the Trustee agrees to comply with the terms of each custodial agreement and
to enforce the terms and provisions thereof against the Custodian for the
benefit of the Certificateholders. Each Custodian shall be a depository
institution subject to supervision by federal or state authority, shall have a
combined capital and surplus of at least $10,000,000 and shall be qualified to
do business in the jurisdiction in which it holds any Mortgage File.
Notwithstanding the foregoing, to the extent the Trustee appoints
one or more Custodians with respect to more than 5% of the aggregate Stated
Principal Balance of the Mortgage Loans, the Trustee shall cause such Custodian
to prepare a separate assessment and attestation report, as contemplated by
Section 3.19 of this Agreement and deliver such report to the Trustee as set
forth in Section 3.22 of this Agreement.
Section 9.13 Paying Agents. The Trustee may appoint one or more
Paying Agents (each, a "Paying Agent") which shall be authorized to act on
behalf of the Trustee in making withdrawals from the Certificate Account and
distributions to Certificateholders as provided in Section 3.08 and Section
5.02. Wherever reference is made in this Agreement to the withdrawal from the
Certificate Account by the Trustee, such reference shall be deemed to include
such a withdrawal on behalf of the Trustee by a Paying Agent. Initially, the
Paying Agent shall be Xxxxx Fargo Bank, N.A. Whenever reference is made in this
Agreement to a distribution by the Trustee or the furnishing of a statement to
Certificateholders by the Trustee, such reference shall be deemed to include
such a distribution or furnishing on behalf of the Trustee by a Paying Agent.
Each Paying Agent shall provide to the Trustee such information concerning the
Certificate Account as the Trustee shall request from time to time. Each Paying
Agent must be reasonably acceptable to the Servicer and must be a corporation or
banking association organized and doing business under the laws of the United
States of America or of any state, having (except in the case of the Trustee) a
principal office and place of business in New York, New York, having a combined
capital and surplus of at least $15,000,000, authorized under such laws to do a
trust business and subject to supervision or examination by federal or state
authorities.
Any corporation into which any Paying Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which any Paying Agent shall be
a party, or any corporation succeeding to the corporate agency business of any
Paying Agent, shall continue to be the Paying Agent, provided that such
corporation after the consummation of such merger, conversion, consolidation or
succession meets the eligibility requirements of this Section 9.13.
Any Paying Agent may at any time resign by giving written notice of
resignation to the Trustee and to the Servicer; provided that the Paying Agent
has returned to the Certificate Account or otherwise accounted, to the
reasonable satisfaction of the Trustee, for all amounts it has withdrawn from
the Certificate Account. The Trustee may, upon prior written approval of the
Servicer, at any time terminate the agency of any Paying Agent by giving written
notice of termination to such Paying Agent and to the Servicer. Upon receiving a
notice of resignation or upon such a termination, or in case at any time any
Paying Agent shall cease to be eligible in accordance with the provisions of the
first paragraph of this Section 9.13, the Trustee may appoint, upon prior
written approval of the Servicer, a successor Paying Agent, shall give written
notice of such appointment to the Servicer and shall mail notice of such
appointment to all Certificateholders. Any successor Paying Agent upon
acceptance of its appointment hereunder shall become vested with all rights,
powers, duties and responsibilities of its predecessor hereunder, with like
effect as if originally named as Paying Agent. The Trustee shall remain liable
for any duties and obligations assumed by its appointed Paying Agent.
Section 9.14 Limitation of Liability. The Certificates are executed
by the Trustee, not in its individual capacity but solely as Trustee of the
Trust, in the exercise of the powers and authority conferred and vested in it by
this Agreement. Each of the undertakings and agreements made on the part of the
Trustee in the Certificates is made and intended not as a personal undertaking
or agreement by the Trustee but is made and intended for the purpose of binding
only the Trust.
Section 9.15 Trustee May Enforce Claims Without Possession of
Certificates. All rights of action and claims under this Agreement or the
Certificates may be prosecuted and enforced by the Trustee without the
possession of any of the Certificates or the production thereof in any
proceeding relating thereto, and such proceeding instituted by the Trustee shall
be brought in its own name or in its capacity as Trustee. Any recovery of
judgment shall, after provision for the payment of the reasonable compensation,
expenses, disbursement and advances of the Trustee, its agents and counsel, be
for the ratable benefit of the Certificateholders in respect of which such
judgment has been recovered.
Section 9.16 Suits for Enforcement. In case an Event of Default or
other default by the Servicer or the Depositor hereunder shall occur and be
continuing, the Trustee, in its discretion, may proceed to protect and enforce
its rights and the rights of the Holders of Certificates under this Agreement by
a suit, action or proceeding in equity or at law or otherwise, whether for the
specific performance of any covenant or agreement contained in this Agreement or
in aid of the execution of any power granted in this Agreement or for the
enforcement of any other legal, equitable or other remedy, as the Trustee, being
advised by counsel, shall deem most effectual to protect and enforce any of the
rights of the Trustee and the Certificateholders.
Section 9.17 Waiver of Bond Requirement. The Trustee shall be
relieved of, and each Certificateholder hereby waives, any requirement of any
jurisdiction in which the Trust, or any part thereof, may be located that the
Trustee post a bond or other surety with any court, agency or body whatsoever.
Section 9.18 Waiver of Inventory, Accounting and Appraisal
Requirement. The Trustee shall be relieved of, and each Certificateholder hereby
waives, any requirement of any jurisdiction in which the Trust, or any part
thereof, may be located that the Trustee file any inventory, accounting or
appraisal of the Trust with any court, agency or body at any time or in any
manner whatsoever.
ARTICLE X
TERMINATION
Section 10.01 Termination upon Purchase by the Call Right Holder or
Liquidation of All Mortgage Loans. Subject to Section 10.02, the respective
obligations and responsibilities of the Depositor, the Servicer and the Trustee
created hereby (other than the obligation of the Trustee to make certain
payments to Certificateholders after the Final Distribution Date and to send
certain notices as hereinafter set forth and the obligations of the Trustee
pursuant to Sections 5.04(b) and 5.05(b)) shall terminate upon the last action
required to be taken by the Trustee on the Final Distribution Date pursuant to
this Article X following the earlier of (a) the purchase by the Call Right
Holder of all Mortgage Loans and all REO Property remaining in the Trust Estate
at a price equal to the sum of (i) 100% of the unpaid principal balance of each
Mortgage Loan (other than any Mortgage Loan as to which REO Property has been
acquired and whose fair market value is included pursuant to clause (ii) below),
(ii) the fair market value of such REO Property, plus any Cap Carryover Amount
for previous Distribution Dates for any Class of Certificates as well as one
month's interest at the related Mortgage Interest Rate on the unpaid principal
balance of each Mortgage Loan (including any Mortgage Loan as to which REO
Property has been acquired) and (iii) any Reimbursement Amount owed to the Trust
pursuant to Section 2.04 or (b) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan remaining in the Trust
Estate or the disposition of all REO Property.
Regardless of the foregoing, in no event shall the Trust created
hereby continue beyond the expiration of 21 years from the death of the last
survivor of the descendants of Xxxxxx X. Xxxxxxx, the late ambassador of the
United States to the Court of St. Xxxxx, living on the date hereof.
The right of the Call Right Holder to repurchase all of the Mortgage
Loans is conditioned upon (A) the aggregate Stated Principal Balance of the
Mortgage Loans as of such Final Distribution Date being less than 10% of the
aggregate Cut-off Date Pool Principal Balance and (B) the sum of clauses (a)(i)
and (ii) of the second preceding paragraph being less than or equal to the
aggregate fair market value of the Mortgage Loans (other than any Mortgage Loan
as to which REO Property has been acquired) and the REO Properties; provided,
however, that this clause (B) shall not apply to any purchase by the Call Right
Holder if, at the time of the purchase, the Call Right Holder is not subject to
regulation by the OCC, the FDIC, the Federal Reserve or the OTS. Fair market
value for purposes of this paragraph and the second preceding paragraph will be
determined by the Call Right Holder as of the close of business on the third
Business Day next preceding the date upon which notice of any such termination
is furnished to Certificateholders pursuant to the fourth paragraph of this
Article X. If such right is exercised, the Trustee shall, promptly following
payment of the purchase price, release to the Call Right Holder or its designee
the Mortgage Files pertaining to the Mortgage Loans being purchased. The Call
Right Holder's right, title and interest in and to the purchased Mortgage loans
and the related Mortgage Files shall be subject to the servicing rights of the
Servicer.
Notice of any termination, specifying the Final Distribution Date
(which shall be a date that would otherwise be a Distribution Date) upon which
the Certificateholders may surrender their Certificates to the Trustee for
payment of the final distribution and for cancellation, shall be given promptly
by the Call Right Holder (if exercising its right to purchase the assets of the
Trust) or by the Trustee (in any other case) by letter to Certificateholders
mailed not earlier than the 15th day and not later than the 25th day of the
month next preceding the month of such final distribution specifying (1) the
Final Distribution Date upon which final payment of the Certificates will be
made upon presentation and surrender of Certificates at the office or agency of
the Trustee therein designated, (2) the amount of any such final payment and (3)
that the Record Date otherwise applicable to such Distribution Date is not
applicable, payments being made only upon presentation and surrender of the
Certificates at the office or agency of the Trustee therein specified. If the
Call Right Holder is obligated to give notice to Certificateholders as
aforesaid, it shall give such notice to the Trustee and the Certificate
Registrar at the time such notice is given to Certificateholders. In the event
such notice is given by the Call Right Holder, the Call Right Holder shall
deposit in the Certificate Account on or before the Final Distribution Date in
immediately available funds an amount equal to the amount necessary to make the
amount, if any, on deposit in the Certificate Account on the Final Distribution
Date equal to the purchase price for the related assets of the Trust computed as
above provided together with a statement as to the amount to be distributed on
each Class of Certificates pursuant to the next succeeding paragraph. Not less
than five (5) Business Days prior to the Final Distribution Date, the Trustee
shall notify the Call Right Holder of the amount of any unpaid Reimbursement
Amount owed to the Trust and the Call Right Holder shall remit such amount to
the Trustee for deposit into the Certificate Account not later than the Business
Day preceding the Final Distribution Date.
Upon presentation and surrender of the Certificates, the Trustee
shall cause to be distributed to Certificateholders of each Class, in the order
set forth in Section 5.02 hereof, on the Final Distribution Date and in
proportion to their respective Percentage Interests, with respect to
Certificateholders of the same Class, an amount equal to (I) as to each Class of
Certificates, the Class Certificate Balance thereof plus (a) accrued interest
thereon in the case of an interest bearing Certificate and (b) any Cap Carryover
Amount (II) as to the Class R Certificate, the amounts, if any, which remain on
deposit (or are deemed to remain on deposit) in the Certificate Account (other
than the amounts retained to meet claims) after application pursuant to clause
(I) above.
If all of the Certificateholders do not surrender their Certificates
for final payment and cancellation on or before the Final Distribution Date, the
Trustee shall on such date cause all funds in the Certificate Account not
distributed in final distribution to Certificateholders of such Group to
continue to be held by the Trustee in an Eligible Account for the benefit of
such Certificateholders and the Call Right Holder (if it exercised its right to
purchase the assets of the Trust Estate) or the Trustee (in any other case)
shall give a second written notice to the remaining Certificateholders to
surrender their Certificates for cancellation and receive the final distribution
with respect thereto. If within one year after the second notice all the
applicable Certificates shall not have been surrendered for cancellation, the
Trustee may take appropriate steps, or may appoint an agent to take appropriate
steps, to contact the remaining Certificateholders concerning surrender of their
Certificates, and the cost thereof shall be paid out of the funds on deposit in
such Eligible Account.
Section 10.02 Additional Termination Requirements. (a) If the Call
Right Holder exercises its purchase option as provided in Section 10.01, the
Trust shall be terminated in accordance with the following additional
requirements, unless the Trustee has received an Opinion of Counsel to the
effect that the failure of the Trust to comply with the requirements of this
Section 10.02 will not (i) result in the imposition of taxes on "prohibited
transactions" of the Trust as defined in Section 860F of the Code, or (ii) cause
the Trust Estate to fail to qualify as three separate REMICs 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 the Call Right Holder under Section 10.01, the Trustee
shall sell all of the assets of the Trust Estate to the Call Right Holder
for cash; and
(ii) the notice given by the Call Right Holder or the Trustee
pursuant to Section 10.01 shall provide that such notice constitutes the
adopting of a plan of complete liquidation of the REMICs as of the date of
such notice (or, if earlier, the date on which such notice was mailed to
Certificateholders). The Trustee shall also specify such date in the final
tax returns of each REMIC.
(b) By its acceptance of the Residual Certificate, the Holder
thereof hereby agrees to take such other action in connection with such plan of
complete liquidation as may be reasonably requested by the Depositor.
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01 Amendment. This Agreement may be amended from time to
time by the Depositor, the Servicer and the Trustee without the consent of any
of the Certificateholders, (i) to cure any ambiguity or mistake, (ii) to correct
or supplement any provisions herein or therein which may be inconsistent with
any other provisions of this Agreement, any amendment to this Agreement or the
related Prospectus Supplement, (iii) to modify, eliminate or add to any of its
provisions to such extent as shall be necessary to maintain the qualification of
REMIC 1 or REMIC 2 as REMICs at all times that any Certificates are outstanding
or to avoid or minimize the risk of the imposition of any tax on either REMIC
pursuant to the Code that would be a claim against the Trust Estate, provided
that (a) the Trustee has received an Opinion of Counsel to the effect that such
action is necessary or desirable to maintain such qualification or to avoid or
minimize the risk of the imposition of any such tax and (b) such action shall
not, as evidenced by such Opinion of Counsel, adversely affect in any material
respect the interests of any Certificateholder, (iv) to change the timing and/or
nature of deposits into the Certificate Account, provided, that (a) such change
shall not, as evidenced by an Opinion of Counsel, adversely affect in any
material respect the interests of any Certificateholder and (b) such change
shall not adversely affect the then-current rating of the Offered Certificates,
as evidenced by a letter from each Rating Agency rating such Certificates to
such effect, (v) to reduce the percentage of the aggregate Cut-off Date Pool
Principal Balance at which the Call Right Holder will have the option to
purchase all the remaining Mortgage Loans in accordance with Section 10.01,
provided that such reduction is considered necessary by the Depositor, as
evidenced by an Officer's Certificate delivered to the Trustee, to preserve the
treatment of the transfer of the Mortgage Loans to the Depositor by the Seller
or to the Trust by the Depositor as sale for accounting purposes, and (vi) to
make any other provisions with respect to matters or questions arising under
this Agreement which shall not be materially inconsistent with the provisions of
this Agreement, provided that such action shall not, as evidenced by an Opinion
of Counsel, adversely affect in any material respect the interests of any
Certificateholder, provided that the amendment shall not be deemed to adversely
affect in any material respect the interests of the Certificateholders and no
Opinion of Counsel to that effect shall be required if the Person requesting the
amendment obtains a letter from each Rating Agency stating that the amendment
would not result in the downgrading or withdrawal of the respective ratings then
assigned to the Certificates.
This Agreement may also be amended from time to time by the
Depositor, the Servicer and the Trustee, with the consent of the Holders of
Certificates of each Class of Certificates which is affected by such amendment,
evidencing, as to each such Class of Certificates, Percentage Interests
aggregating not less than 66-2/3%, for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions of this Agreement
or of modifying in any manner the rights of the Holders of such Certificates;
provided, however, that no such amendment shall (A) reduce in any manner the
amount of, or delay the timing of, collections of payments on Mortgage Loans or
distributions which are required to be made on any Certificate without the
consent of the Holder of such Certificate or (B) reduce the aforesaid percentage
required to consent to any such amendment, without the consent of the Holders of
all Certificates then Outstanding.
Prior to the solicitation of consent of Certificateholders in
connection with any such amendment, the party seeking such amendment shall
furnish the Trustee with an Opinion of Counsel to the effect that such amendment
would not subject any of the REMICs to any tax or cause any of the REMICs to
fail to qualify as a REMIC or the Grantor Trust to fail to qualify as a grantor
trust. Notwithstanding any other provision of this Agreement, the Trustee shall
not consent to any amendment to this Agreement unless it shall have first
received such Opinion of Counsel.
Promptly after the execution of any such amendment or consent the
Trustee shall furnish written notification of the substance of or a copy of such
amendment to each Certificateholder and to each Rating Agency.
It shall not be necessary for the consent of Certificateholders
under this Section 11.01 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 requirements as the Trustee may prescribe.
Section 11.02 Recordation of Agreement. This Agreement is subject to
recordation in all appropriate public offices for real property records in all
the counties or other comparable jurisdictions in which any or all of the
properties subject to the Mortgages are situated, and in any other appropriate
public recording office or elsewhere, such recordation to be effected by the
Servicer and at its expense on direction by the Trustee, who will act at the
direction of Holders of Certificates evidencing not less than 50% of all Voting
Rights, but only upon direction of the Trustee accompanied by an Opinion of
Counsel to the effect that such recordation materially and beneficially affects
the interests of Certificateholders.
For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.
Section 11.03 Limitation on Rights of Certificateholders. The death
or incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or to take any action or
commence any proceeding in any court for a partition or winding up of the Trust,
nor 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, 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 person by reason of any action taken by the parties to this Agreement
pursuant to any provision hereof.
No Certificateholder shall have any right by virtue or by availing
itself of any provisions of this Agreement to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this Agreement,
unless such Holder previously shall have given to the Trustee a written notice
of default and of the continuance thereof, as provided herein, and unless also
the Holders of Certificates evidencing Percentage Interests aggregating not less
than 25% of each Class of Certificates affected thereby shall have made written
request upon the Trustee to institute such action, suit or proceeding in its own
name as Trustee hereunder and shall have offered to the Trustee such reasonable
indemnity as it may require against the costs, expenses and liabilities to be
incurred therein or thereby, and the Trustee, for 60 days after its receipt of
such notice, request and offer of indemnity, shall have neglected or refused to
institute any such action, suit or proceeding; it being understood and intended,
and being expressly covenanted by each Certificateholder with every other
Certificateholder and the Trustee, that no one or more Holders of Certificates
shall have any right in any manner whatever by virtue or by availing itself or
themselves of any provisions of this Agreement to affect, disturb or prejudice
the rights of the Holders of any other of the Certificates, or to obtain or seek
to obtain priority over or preference to any other such Holder, or to enforce
any right under this Agreement, except in the manner herein provided and for the
equal, ratable and common benefit of all Certificateholders. For the protection
and enforcement of the provisions of this Section 11.03, each and every
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.
Section 11.04 Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT APPLICATION OF THE
CONFLICTS OF LAWS PROVISIONS THEREOF, AND THE OBLIGATIONS, RIGHTS AND REMEDIES
OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 11.05 Notices. All demands, notices, instructions,
directions, requests and communications required to be delivered hereunder shall
be in writing and shall be deemed to have been duly given if personally
delivered at or mailed by certified mail, return receipt requested, (provided,
however, that notices to the Trustee may be delivered by facsimile and shall be
deemed effective upon receipt) to (a) in the case of the Depositor, Banc of
America Mortgage Securities, Inc., 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx
Xxxxxxxx 00000, Attention: General Counsel and Chief Financial Officer, (b) in
the case of the Servicer, Bank of America, National Association, 000 Xxxxxxxxxx
Xxxxxxx, Xxxxxxxxx, Xxx Xxxx 00000-0000, Attention: Servicing Manager, with a
copy to: Bank of America, National Association, 000 Xxxxx Xxxxx Xxxxxx,
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000, Attention: General Counsel and Chief Financial
Officer, (c) in the case of the Trustee, Xxxxx Fargo Bank, N.A., X.X. Xxx 00,
Xxxxxxxx, Xxxxxxxx 00000, Attention: BOALT, Series 2006-7, and for overnight
delivery purposes, Xxxxx Fargo Bank, N.A., 0000 Xxx Xxxxxxxxx Xxxx, Xxxxxxxx,
Xxxxxxxx 00000-0000, Attention: BOALT, Series 2006-7, with a copy to Xxxxx Fargo
Bank, N.A., Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx, 00000,
Attention: BOALT, Series 2006-7, (d) in the case of Moody's, Xxxxx'x Investors
Service, Inc., 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Residential Mortgage Monitoring Group, and (e) in the case of S&P, Standard &
Poor's, a division of The XxXxxx-Xxxx Companies, Inc., 00 Xxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attn: Mortgage Surveillance Group; or, as to each party,
at such other address as shall be designated by such party in a written notice
to each other party. Any notice required or permitted to be mailed to a
Certificateholder shall be given by first class mail, postage prepaid, at the
address of such Holder as shown in the Certificate Register. Any notice so
mailed within the time prescribed in this Agreement shall be conclusively
presumed to have been duly given, whether or not the Certificateholder receives
such notice.
Section 11.06 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 11.07 Certificates Nonassessable and Fully Paid. It is the
intention of the Trustee that Certificateholders shall not be personally liable
for obligations of the Trust Estate, that the beneficial ownership interests
represented by the Certificates shall be nonassessable for any losses or
expenses of the Trust Estate or for any reason whatsoever, and that Certificates
upon execution, authentication and delivery thereof by the Trustee pursuant to
Section 6.01 are and shall be deemed fully paid.
Section 11.08 Access to List of Certificateholders. The Certificate
Registrar will furnish or cause to be furnished to the Trustee, within 15 days
after the receipt of a request by the Trustee in writing, a list, in such form
as the Trustee may reasonably require, of the names and addresses of the
Certificateholders as of the most recent Record Date for payment of
distributions to Certificateholders.
If three or more Certificateholders apply in writing to the Trustee,
and such application states that the applicants desire to communicate with other
Certificateholders with respect to their rights under this Agreement or under
the Certificates and is accompanied by a copy of the communication which such
applicants propose to transmit, then the Trustee shall, within five Business
Days after the receipt of such application, afford such applicants access during
normal business hours to the most recent list of Certificateholders held by the
Trustee. If such a list is as of a date more than 90 days prior to the date of
receipt of such applicants' request, the Trustee shall promptly request from the
Certificate Registrar a current list as provided above, and shall afford such
applicants access to such list promptly upon receipt.
Every Certificateholder, by receiving and holding such list, agrees
with the Certificate Registrar and the Trustee that neither the Certificate
Registrar nor the Trustee shall be held accountable by reason of the disclosure
of any such information as to the names and addresses of the Certificateholders
hereunder, regardless of the source from which such information was derived.
Section 11.09 Recharacterization. The parties to this Agreement
intend the conveyance by the Depositor to the Trustee of all of its right, title
and interest in and to the Mortgage Loans pursuant to this Agreement to
constitute a purchase and sale and not a loan. Notwithstanding the foregoing, to
the extent that such conveyance is held not to constitute a sale under
applicable law, it is intended that this Agreement shall constitute a security
agreement under applicable law and that the Depositor shall be deemed to have
granted to the Trustee a first priority security interest in all of the
Depositor's right, title and interest in and to the Mortgage Loans.
Section 11.10 Insolvency. The Servicer, Depositor and Trustee shall
each notify the Depositor and the Trustee of any of the events enumerated in
Item 1.03 of Form 8-K with respect to any of the Servicer, Depositor or Trustee
at least two Business Days prior to the effective date thereof and shall provide
the Depositor and the Trustee with all information required by the Depositor to
comply with its reporting obligation under Item 1.03 of Form 8-K not later than
the effective date of any such event.
Section 11.11 Regulation AB Compliance; Intent of Parties;
Reasonableness. The parties hereto acknowledge that interpretations of the
requirements of Regulation AB may change over time, whether due to interpretive
guidance provided by the Securities and Exchange Commission or its staff,
consensus among participants in the asset-backed securities markets, advice of
counsel, or otherwise, and agree to comply with requests made by the Depositor
in good faith for delivery of information under these provisions on the basis of
evolving interpretations of Regulation AB. In connection with the Trust, the
Servicer and the Trustee shall cooperate fully with the Depositor to deliver to
the Depositor (including its assignees or designees), any and all statements,
reports, certifications, records and any other information available to such
party and reasonably necessary in the good faith determination of the Depositor
to permit the Depositor to comply with the provisions of Regulation AB, together
with such disclosures relating to the Servicer and the Trustee, as applicable,
reasonably believed by the Depositor to be necessary in order to effect such
compliance.
IN WITNESS WHEREOF, the Depositor, the Servicer and the Trustee have
caused this Agreement to be duly executed by their respective officers thereunto
duly authorized to be hereunto affixed, all as of the day and year first above
written.
BANC OF AMERICA MORTGAGE SECURITIES, INC.,
as Depositor
By: /s/ Xxxx Xxxxxx
-------------------------------------
Name: Xxxx Xxxxxx
Title: Senior Vice President
BANK OF AMERICA, NATIONAL ASSOCIATION,
as Servicer
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Senior Vice President
XXXXX FARGO BANK, N.A.,
as Trustee
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Assistant Vice President
STATE OF MARYLAND )
) ss.:
CITY OF BALTIMORE )
On the 28th day of September, 2006, before me, a notary public in
and for the State of Maryland, personally appeared Xxxxxx X. Xxxxxx, known to me
who, being by me duly sworn, did depose and say that he is an Assistant Vice
President of Xxxxx Fargo Bank, N.A., a national banking association, one of the
parties that executed the foregoing instrument; and that he signed his name
thereto by order of the Board of Directors of such association.
_________________________________
Notary Public
[Notarial Seal]
My commission expires ____________.
STATE OF KANSAS )
) ss.:
COUNTY OF XXXXXXX )
On the 28th day of September, 2006, before me, a notary public in
and for the State of Kansas, personally appeared Xxxx Xxxxxx, known to me who,
being by me duly sworn, did depose and say that she is a Senior Vice President
of Banc of America Mortgage Securities, Inc. a Delaware corporation, one of the
parties that executed the foregoing instrument; and that she signed her name
thereto by order of the Board of Directors of such corporation.
_________________________________
Notary Public
[Notarial Seal]
My commission expires ____________.
STATE OF )
) ss.:
COUNTY OF )
On the 28th day of September, 2006, before me, a notary public in
and for the State of North Carolina, personally appeared Xxxxxxx X. Xxxxxxxx,
known to me who, being by me duly sworn, did depose and say that he is a Senior
Vice President of Bank of America, National Association, a national banking
association, one of the parties that executed the foregoing instrument; and that
he signed his name thereto by order of the Board of Directors of such
association.
_________________________________
Notary Public
[Notarial Seal]
My commission expires ____________.
EXHIBIT A-A-1
[FORM OF FACE OF CLASS A-1 CERTIFICATE]
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class A-1
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR 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
BENEFICIAL 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").
REDUCTIONS OF THE CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERENCED HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE LESS THAN THE
AMOUNT SET FORTH BELOW.
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class A-1
evidencing an interest in a Trust consisting primarily of a pool of mortgage
loans (the "Mortgage Loans") secured by first liens on one- to four-family
residential properties deposited by
Banc of America Mortgage Securities, Inc., as Depositor
Certificate No.:
Cut-Off Date: September 1, 2006
First Distribution Date: October 25, 2006
Initial Certificate
Balance of this
Certificate
("Denomination"): $
Initial Class Certificate
Balance of this Class: $251,644,000.00
CUSIP No.: 059469 AA 4
ISIN No.: US059469AA40
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 Initial Class Certificate Balance of the Class to which
this Certificate belongs) in certain monthly distributions with respect to a
Trust consisting primarily of the Mortgage Loans deposited by Banc of America
Mortgage Securities, Inc. (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement, dated September 28, 2006 (the "Pooling and
Servicing Agreement"), among the Depositor, Bank of America, National
Association, as servicer (the "Servicer"), and Xxxxx Fargo Bank, N.A., as
trustee (the "Trustee"). To the extent not defined herein, the capitalized terms
used herein have the meanings assigned in the Pooling and Servicing Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
The Certificate Interest Rate for the Class A-1 Certificates for each
Distribution Date will be the lesser of (i) the Class A-1 Pass-Through Rate and
(ii) the Pool Cap. Interest will accrue on the Class A-1 Certificates during
each Interest Accrual Period at the Certificate Interest Rate.
Principal and the Monthly Excess Cashflow Amount in respect of this
Certificate is distributable monthly as set forth in the Pooling and Servicing
Agreement. Accordingly, the Certificate Balance of this Certificate 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 Servicer or the Trustee referred to
below or any of their respective affiliates. Neither this Certificate nor the
Mortgage Loans are guaranteed or insured by any governmental agency or
instrumentality.
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 Pooling
and Servicing Agreement or be valid for any purpose unless manually
authenticated by an authorized signatory of the Trustee.
* * *
EXHIBIT A-A-2
[FORM OF FACE OF CLASS A-2 CERTIFICATE]
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class A-2
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR 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
BENEFICIAL 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").
REDUCTIONS OF THE CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERENCED HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE LESS THAN THE
AMOUNT SET FORTH BELOW.
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class A-2
evidencing an interest in a Trust consisting primarily of a pool of mortgage
loans (the "Mortgage Loans") secured by first liens on one- to four-family
residential properties deposited by
Banc of America Mortgage Securities, Inc., as Depositor
Certificate No.:
Cut-Off Date: September 1, 2006
First Distribution Date: October 25, 2006
Initial Certificate
Balance of this
Certificate
("Denomination"): $
Initial Class Certificate
Balance of this Class: $72,970,000.00
CUSIP No.: 059469 AB 2
ISIN No.: US059469AB23
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 Initial Class Certificate Balance of the Class to which
this Certificate belongs) in certain monthly distributions with respect to a
Trust consisting primarily of the Mortgage Loans deposited by Banc of America
Mortgage Securities, Inc. (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement, dated September 28, 2006 (the "Pooling and
Servicing Agreement"), among the Depositor, Bank of America, National
Association, as servicer (the "Servicer"), and Xxxxx Fargo Bank, N.A., as
trustee (the "Trustee"). To the extent not defined herein, the capitalized terms
used herein have the meanings assigned in the Pooling and Servicing Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
The Certificate Interest Rate for the Class A-2 Certificates for each
Distribution Date will be the lesser of (i) the Class A-2 Pass-Through Rate and
(ii) the Pool Cap. Interest will accrue on the Class A-2 Certificates during
each Interest Accrual Period at the Certificate Interest Rate.
Principal and the Monthly Excess Cashflow Amount in respect of this
Certificate is distributable monthly as set forth in the Pooling and Servicing
Agreement. Accordingly, the Certificate Balance of this Certificate 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 Servicer or the Trustee referred to
below or any of their respective affiliates. Neither this Certificate nor the
Mortgage Loans are guaranteed or insured by any governmental agency or
instrumentality.
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 Pooling
and Servicing Agreement or be valid for any purpose unless manually
authenticated by an authorized signatory of the Trustee.
* * *
EXHIBIT A-A-3
[FORM OF FACE OF CLASS A-3 CERTIFICATE]
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class A-3
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR 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
BENEFICIAL 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").
REDUCTIONS OF THE CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERENCED HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE LESS THAN THE
AMOUNT SET FORTH BELOW.
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class A-3
evidencing an interest in a Trust consisting primarily of a pool of mortgage
loans (the "Mortgage Loans") secured by first liens on one- to four-family
residential properties deposited by
Banc of America Mortgage Securities, Inc., as Depositor
Certificate No.:
Cut-Off Date: September 1, 2006
First Distribution Date: October 25, 2006
Initial Certificate
Balance of this
Certificate
("Denomination"): $
Initial Class Certificate
Balance of this Class: $97,674,000.00
CUSIP No.: 059469 AC 0
ISIN No.: US059469AC06
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 Initial Class Certificate Balance of the Class to which
this Certificate belongs) in certain monthly distributions with respect to a
Trust consisting primarily of the Mortgage Loans deposited by Banc of America
Mortgage Securities, Inc. (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement, dated September 28, 2006 (the "Pooling and
Servicing Agreement"), among the Depositor, Bank of America, National
Association, as servicer (the "Servicer"), and Xxxxx Fargo Bank, N.A., as
trustee (the "Trustee"). To the extent not defined herein, the capitalized terms
used herein have the meanings assigned in the Pooling and Servicing Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
The Certificate Interest Rate for the Class A-3 Certificates for each
Distribution Date will be the lesser of (i) the Class A-3 Pass-Through Rate and
(ii) the Pool Cap. Interest will accrue on the Class A-3 Certificates during
each Interest Accrual Period at the Certificate Interest Rate.
Principal and the Monthly Excess Cashflow Amount in respect of this
Certificate is distributable monthly as set forth in the Pooling and Servicing
Agreement. Accordingly, the Certificate Balance of this Certificate 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 Servicer or the Trustee referred to
below or any of their respective affiliates. Neither this Certificate nor the
Mortgage Loans are guaranteed or insured by any governmental agency or
instrumentality.
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 Pooling
and Servicing Agreement or be valid for any purpose unless manually
authenticated by an authorized signatory of the Trustee.
* * *
EXHIBIT A-A-4
[FORM OF FACE OF CLASS A-4 CERTIFICATE]
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class A-4
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR 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
BENEFICIAL 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").
REDUCTIONS OF THE CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERENCED HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE LESS THAN THE
AMOUNT SET FORTH BELOW.
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class A-4
evidencing an interest in a Trust consisting primarily of a pool of mortgage
loans (the "Mortgage Loans") secured by first liens on one- to four-family
residential properties deposited by
Banc of America Mortgage Securities, Inc., as Depositor
Certificate No.:
Cut-Off Date: September 1, 2006
First Distribution Date: October 25, 2006
Initial Certificate
Balance of this
Certificate
("Denomination"): $
Initial Class Certificate
Balance of this Class: $74,176,000.00
CUSIP No.: 059469 AD 8
ISIN No.: US059469AD88
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 Initial Class Certificate Balance of the Class to which
this Certificate belongs) in certain monthly distributions with respect to a
Trust consisting primarily of the Mortgage Loans deposited by Banc of America
Mortgage Securities, Inc. (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement, dated September 28, 2006 (the "Pooling and
Servicing Agreement"), among the Depositor, Bank of America, National
Association, as servicer (the "Servicer"), and Xxxxx Fargo Bank, N.A., as
trustee (the "Trustee"). To the extent not defined herein, the capitalized terms
used herein have the meanings assigned in the Pooling and Servicing Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
The Certificate Interest Rate for the Class A-4 Certificates for each
Distribution Date will be the lesser of (i) the Class A-4 Pass-Through Rate and
(ii) the Pool Cap. Interest will accrue on the Class A-4 Certificates during
each Interest Accrual Period at the Certificate Interest Rate.
Principal and the Monthly Excess Cashflow Amount in respect of this
Certificate is distributable monthly as set forth in the Pooling and Servicing
Agreement. Accordingly, the Certificate Balance of this Certificate 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 Servicer or the Trustee referred to
below or any of their respective affiliates. Neither this Certificate nor the
Mortgage Loans are guaranteed or insured by any governmental agency or
instrumentality.
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 Pooling
and Servicing Agreement or be valid for any purpose unless manually
authenticated by an authorized signatory of the Trustee.
* * *
EXHIBIT A-A-5
[FORM OF FACE OF CLASS A-5 CERTIFICATE]
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class A-5
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR 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
BENEFICIAL 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").
REDUCTIONS OF THE CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERENCED HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE LESS THAN THE
AMOUNT SET FORTH BELOW.
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class A-5
evidencing an interest in a Trust consisting primarily of a pool of mortgage
loans (the "Mortgage Loans") secured by first liens on one- to four-family
residential properties deposited by
Banc of America Mortgage Securities, Inc., as Depositor
Certificate No.:
Cut-Off Date: September 1, 2006
First Distribution Date: October 25, 2006
Initial Certificate
Balance of this
Certificate
("Denomination"): $
Initial Class Certificate
Balance of this Class: $24,215,000.00
CUSIP No.: 059469 AE 6
ISIN No.: US059469AE61
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 Initial Class Certificate Balance of the Class to which
this Certificate belongs) in certain monthly distributions with respect to a
Trust consisting primarily of the Mortgage Loans deposited by Banc of America
Mortgage Securities, Inc. (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement, dated September 28, 2006 (the "Pooling and
Servicing Agreement"), among the Depositor, Bank of America, National
Association, as servicer (the "Servicer"), and Xxxxx Fargo Bank, N.A., as
trustee (the "Trustee"). To the extent not defined herein, the capitalized terms
used herein have the meanings assigned in the Pooling and Servicing Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
The Certificate Interest Rate for the Class A-5 Certificates for each
Distribution Date will be the lesser of (i) the Class A-5 Pass-Through Rate and
(ii) the Pool Cap. Interest will accrue on the Class A-5 Certificates during
each Interest Accrual Period at the Certificate Interest Rate.
Principal and the Monthly Excess Cashflow Amount in respect of this
Certificate is distributable monthly as set forth in the Pooling and Servicing
Agreement. Accordingly, the Certificate Balance of this Certificate 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 Servicer or the Trustee referred to
below or any of their respective affiliates. Neither this Certificate nor the
Mortgage Loans are guaranteed or insured by any governmental agency or
instrumentality.
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 Pooling
and Servicing Agreement or be valid for any purpose unless manually
authenticated by an authorized signatory of the Trustee.
* * *
EXHIBIT A-A-6
[FORM OF FACE OF CLASS A-6 CERTIFICATE]
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class A-6
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR 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
BENEFICIAL 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").
REDUCTIONS OF THE CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERENCED HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE LESS THAN THE
AMOUNT SET FORTH BELOW.
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class A-6
evidencing an interest in a Trust consisting primarily of a pool of mortgage
loans (the "Mortgage Loans") secured by first liens on one- to four-family
residential properties deposited by
Banc of America Mortgage Securities, Inc., as Depositor
Certificate No.:
Cut-Off Date: September 1, 2006
First Distribution Date: October 25, 2006
Initial Certificate
Balance of this
Certificate
("Denomination"): $
Initial Class Certificate
Balance of this Class: $120,110,000.00
CUSIP No.: 059469 AF 3
ISIN No.: US059469AF37
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 Initial Class Certificate Balance of the Class to which
this Certificate belongs) in certain monthly distributions with respect to a
Trust consisting primarily of the Mortgage Loans deposited by Banc of America
Mortgage Securities, Inc. (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement, dated September 28, 2006 (the "Pooling and
Servicing Agreement"), among the Depositor, Bank of America, National
Association, as servicer (the "Servicer"), and Xxxxx Fargo Bank, N.A., as
trustee (the "Trustee"). To the extent not defined herein, the capitalized terms
used herein have the meanings assigned in the Pooling and Servicing Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
The Certificate Interest Rate for the Class A-6 Certificates for each
Distribution Date will be the lesser of (i) the Class A-6 Pass-Through Rate and
(ii) the Pool Cap. Interest will accrue on the Class A-6 Certificates during
each Interest Accrual Period at the Certificate Interest Rate.
Principal and the Monthly Excess Cashflow Amount in respect of this
Certificate is distributable monthly as set forth in the Pooling and Servicing
Agreement. Accordingly, the Certificate Balance of this Certificate 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 Servicer or the Trustee referred to
below or any of their respective affiliates. Neither this Certificate nor the
Mortgage Loans are guaranteed or insured by any governmental agency or
instrumentality.
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 Pooling
and Servicing Agreement or be valid for any purpose unless manually
authenticated by an authorized signatory of the Trustee.
* * *
EXHIBIT B-1
[FORM OF FACE OF CLASS M-1 CERTIFICATE]
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class M-1
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR 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
BENEFICIAL 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 THE SENIOR CERTIFICATES
AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT.
UNDER CURRENT LAW THE PURCHASE AND HOLDING OF THIS CERTIFICATE BY OR ON BEHALF
OF ANY EMPLOYEE BENEFIT PLAN OR ARRANGEMENT, INCLUDING AN INDIVIDUAL RETIREMENT
ACCOUNT, SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED ("ERISA"), THE CODE OR ANY FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW")
WHICH IS SIMILAR TO ERISA OR THE CODE (COLLECTIVELY, A "PLAN"), MAY RESULT IN
"PROHIBITED TRANSACTIONS" WITHIN THE MEANING OF ERISA, THE CODE OR SIMILAR LAW.
TRANSFER OF THIS CERTIFICATE WILL NOT BE MADE UNLESS THE TRANSFEREE DELIVERS TO
THE TRUSTEE EITHER (I) A REPRESENTATION LETTER, IN FORM AND SUBSTANCE
SATISFACTORY TO THE TRUSTEE, STATING THAT (A) IT IS NOT, AND IS NOT ACTING ON
BEHALF OF, ANY SUCH PLAN OR USING THE ASSETS OF ANY SUCH PLAN TO EFFECT SUCH
PURCHASE OR (B) IF IT IS AN INSURANCE COMPANY, THAT THE SOURCE OF FUNDS USED TO
PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY GENERAL ACCOUNT" (AS SUCH
TERM IS DEFINED IN SECTION V(E) OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60
("PTE 95-60"), 60 FED. REG. 35925 (JULY 12, 1995)), THERE IS NO PLAN WITH
RESPECT TO WHICH THE AMOUNT OF SUCH GENERAL ACCOUNT'S RESERVES AND LIABILITIES
FOR THE CONTRACT(S) HELD BY OR ON BEHALF OF SUCH PLAN AND ALL OTHER PLANS
MAINTAINED BY THE SAME EMPLOYER (OR AFFILIATE THEREOF AS DEFINED IN SECTION
V(A)(1) OF PTE 95-60) OR BY THE SAME EMPLOYEE ORGANIZATION EXCEEDS 10% OF THE
TOTAL OF ALL RESERVES AND LIABILITIES OF SUCH GENERAL ACCOUNT (AS SUCH AMOUNTS
ARE DETERMINED UNDER SECTION I(A) OF PTE 95-60) AT THE DATE OF ACQUISITION AND
ALL PLANS THAT HAVE AN INTEREST IN SUCH GENERAL ACCOUNT ARE PLANS TO WHICH PTE
95-60 APPLIES, OR (II) AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE SATISFACTORY
TO THE TRUSTEE AND THE SERVICER, TO THE EFFECT THAT THE PURCHASE OR HOLDING OF
THIS CERTIFICATE BY OR ON BEHALF OF SUCH PLAN WILL NOT CONSTITUTE OR RESULT IN A
NON-EXEMPT PROHIBITED TRANSACTION WITHIN THE MEANING OF ERISA, SECTION 4975 OF
THE CODE OR SIMILAR LAW AND WILL NOT SUBJECT THE DEPOSITOR, THE SERVICER OR THE
TRUSTEE TO ANY OBLIGATION IN ADDITION TO THOSE UNDERTAKEN IN THE POOLING AND
SERVICING AGREEMENT. EACH PERSON WHO ACQUIRES THIS CERTIFICATE OR ANY INTEREST
THEREIN SHALL BE DEEMED TO HAVE MADE THE REPRESENTATIONS REQUIRED BY THE
REPRESENTATION LETTER REFERRED TO IN THE PRECEDING SENTENCE, UNLESS SUCH PERSON
SHALL HAVE PROVIDED SUCH REPRESENTATION LETTER OR THE OPINION OF COUNSEL
REFERRED TO IN THE PRECEDING SENTENCE TO THE TRUSTEE. THE POOLING AND SERVICING
AGREEMENT PROVIDES THAT ANY ATTEMPTED OR PURPORTED TRANSFER IN VIOLATION OF
THESE TRANSFER RESTRICTIONS WILL BE NULL AND VOID AND WILL VEST NO RIGHTS IN ANY
PURPORTED TRANSFEREE.
REDUCTIONS OF THE CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERENCED HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE LESS THAN THE
AMOUNT SET FORTH BELOW.
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class M-1
evidencing an interest in a Trust consisting primarily of a pool of mortgage
loans (the "Mortgage Loans") secured by first liens on one- to four-family
residential properties deposited by
Banc of America Mortgage Securities, Inc., as Depositor
Certificate No.:
Cut-Off Date: September 1, 2006
First Distribution Date: October 25, 2006
Initial Certificate
Balance of this
Certificate
("Denomination"): $
Initial Class Certificate
Balance of this Class: $13,077,000.00
CUSIP No.: 059469 AG 1
ISIN No.: US059469AG10
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 Initial Class Certificate Balance of the Class to which
this Certificate belongs) in certain monthly distributions with respect to a
Trust consisting primarily of the Mortgage Loans deposited by Banc of America
Mortgage Securities, Inc. (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement, dated September 28, 2006 (the "Pooling and
Servicing Agreement"), among the Depositor, Bank of America, National
Association, as servicer (the "Servicer"), and Xxxxx Fargo Bank, N.A., as
trustee (the "Trustee"). To the extent not defined herein, the capitalized terms
used herein have the meanings assigned in the Pooling and Servicing Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
The Certificate Interest Rate for the Class M-1 Certificates for each
Distribution Date will be the lesser of (i) the Class M-1 Pass-Through Rate and
(ii) the Pool Cap. Interest will accrue on the Class M-1 Certificates during
each Interest Accrual Period at the Certificate Interest Rate.
Principal and the Monthly Excess Cashflow Amount in respect of this
Certificate is distributable monthly as set forth in the Pooling and Servicing
Agreement. Accordingly, the Certificate Balance of this Certificate 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 Servicer or the Trustee referred to
below or any of their respective affiliates. Neither this Certificate nor the
Mortgage Loans are guaranteed or insured by any governmental agency or
instrumentality.
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 Pooling
and Servicing Agreement or be valid for any purpose unless manually
authenticated by an authorized signatory of the Trustee.
* * *
EXHIBIT B-2
[FORM OF FACE OF CLASS M-2 CERTIFICATE]
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class M-2
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR 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
BENEFICIAL 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 THE SENIOR CERTIFICATES
AND CLASS M-1 CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT.
UNDER CURRENT LAW THE PURCHASE AND HOLDING OF THIS CERTIFICATE BY OR ON BEHALF
OF ANY EMPLOYEE BENEFIT PLAN OR ARRANGEMENT, INCLUDING AN INDIVIDUAL RETIREMENT
ACCOUNT, SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED ("ERISA"), THE CODE OR ANY FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW")
WHICH IS SIMILAR TO ERISA OR THE CODE (COLLECTIVELY, A "PLAN"), MAY RESULT IN
"PROHIBITED TRANSACTIONS" WITHIN THE MEANING OF ERISA, THE CODE OR SIMILAR LAW.
TRANSFER OF THIS CERTIFICATE WILL NOT BE MADE UNLESS THE TRANSFEREE DELIVERS TO
THE TRUSTEE EITHER (I) A REPRESENTATION LETTER, IN FORM AND SUBSTANCE
SATISFACTORY TO THE TRUSTEE, STATING THAT (A) IT IS NOT, AND IS NOT ACTING ON
BEHALF OF, ANY SUCH PLAN OR USING THE ASSETS OF ANY SUCH PLAN TO EFFECT SUCH
PURCHASE OR (B) IF IT IS AN INSURANCE COMPANY, THAT THE SOURCE OF FUNDS USED TO
PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY GENERAL ACCOUNT" (AS SUCH
TERM IS DEFINED IN SECTION V(E) OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60
("PTE 95-60"), 60 FED. REG. 35925 (JULY 12, 1995)), THERE IS NO PLAN WITH
RESPECT TO WHICH THE AMOUNT OF SUCH GENERAL ACCOUNT'S RESERVES AND LIABILITIES
FOR THE CONTRACT(S) HELD BY OR ON BEHALF OF SUCH PLAN AND ALL OTHER PLANS
MAINTAINED BY THE SAME EMPLOYER (OR AFFILIATE THEREOF AS DEFINED IN SECTION
V(A)(1) OF PTE 95-60) OR BY THE SAME EMPLOYEE ORGANIZATION EXCEEDS 10% OF THE
TOTAL OF ALL RESERVES AND LIABILITIES OF SUCH GENERAL ACCOUNT (AS SUCH AMOUNTS
ARE DETERMINED UNDER SECTION I(A) OF PTE 95-60) AT THE DATE OF ACQUISITION AND
ALL PLANS THAT HAVE AN INTEREST IN SUCH GENERAL ACCOUNT ARE PLANS TO WHICH PTE
95-60 APPLIES, OR (II) AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE SATISFACTORY
TO THE TRUSTEE AND THE SERVICER, TO THE EFFECT THAT THE PURCHASE OR HOLDING OF
THIS CERTIFICATE BY OR ON BEHALF OF SUCH PLAN WILL NOT CONSTITUTE OR RESULT IN A
NON-EXEMPT PROHIBITED TRANSACTION WITHIN THE MEANING OF ERISA, SECTION 4975 OF
THE CODE OR SIMILAR LAW AND WILL NOT SUBJECT THE DEPOSITOR, THE SERVICER OR THE
TRUSTEE TO ANY OBLIGATION IN ADDITION TO THOSE UNDERTAKEN IN THE POOLING AND
SERVICING AGREEMENT. EACH PERSON WHO ACQUIRES THIS CERTIFICATE OR ANY INTEREST
THEREIN SHALL BE DEEMED TO HAVE MADE THE REPRESENTATIONS REQUIRED BY THE
REPRESENTATION LETTER REFERRED TO IN THE PRECEDING SENTENCE, UNLESS SUCH PERSON
SHALL HAVE PROVIDED SUCH REPRESENTATION LETTER OR THE OPINION OF COUNSEL
REFERRED TO IN THE PRECEDING SENTENCE TO THE TRUSTEE. THE POOLING AND SERVICING
AGREEMENT PROVIDES THAT ANY ATTEMPTED OR PURPORTED TRANSFER IN VIOLATION OF
THESE TRANSFER RESTRICTIONS WILL BE NULL AND VOID AND WILL VEST NO RIGHTS IN ANY
PURPORTED TRANSFEREE.
REDUCTIONS OF THE CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERENCED HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE LESS THAN THE
AMOUNT SET FORTH BELOW.
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class M-2
evidencing an interest in a Trust consisting primarily of a pool of mortgage
loans (the "Mortgage Loans") secured by first liens on one- to four-family
residential properties deposited by
Banc of America Mortgage Securities, Inc., as Depositor
Certificate No.:
Cut-Off Date: September 1, 2006
First Distribution Date: October 25, 2006
Initial Certificate
Balance of this
Certificate
("Denomination"): $
Initial Class Certificate
Balance of this Class: $3,353,000.00
CUSIP No.: 059469 AH 9
ISIN No.: US059469AH92
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 Initial Class Certificate Balance of the Class to which
this Certificate belongs) in certain monthly distributions with respect to a
Trust consisting primarily of the Mortgage Loans deposited by Banc of America
Mortgage Securities, Inc. (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement, dated September 28, 2006 (the "Pooling and
Servicing Agreement"), among the Depositor, Bank of America, National
Association, as servicer (the "Servicer"), and Xxxxx Fargo Bank, N.A., as
trustee (the "Trustee"). To the extent not defined herein, the capitalized terms
used herein have the meanings assigned in the Pooling and Servicing Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
The Certificate Interest Rate for the Class M-2 Certificates for each
Distribution Date will be the lesser of (i) the Class M-2 Pass-Through Rate and
(ii) the Pool Cap. Interest will accrue on the Class M-2 Certificates during
each Interest Accrual Period at the Certificate Interest Rate.
Principal and the Monthly Excess Cashflow Amount in respect of this
Certificate is distributable monthly as set forth in the Pooling and Servicing
Agreement. Accordingly, the Certificate Balance of this Certificate 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 Servicer or the Trustee referred to
below or any of their respective affiliates. Neither this Certificate nor the
Mortgage Loans are guaranteed or insured by any governmental agency or
instrumentality.
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 Pooling
and Servicing Agreement or be valid for any purpose unless manually
authenticated by an authorized signatory of the Trustee.
* * *
EXHIBIT B-3
[FORM OF FACE OF CLASS M-3 CERTIFICATE]
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class M-3
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR 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
BENEFICIAL 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 THE SENIOR CERTIFICATES,
CLASS M-1 CERTIFICATES AND CLASS M-2 CERTIFICATES AS DESCRIBED IN THE POOLING
AND SERVICING AGREEMENT.
UNDER CURRENT LAW THE PURCHASE AND HOLDING OF THIS CERTIFICATE BY OR ON BEHALF
OF ANY EMPLOYEE BENEFIT PLAN OR ARRANGEMENT, INCLUDING AN INDIVIDUAL RETIREMENT
ACCOUNT, SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED ("ERISA"), THE CODE OR ANY FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW")
WHICH IS SIMILAR TO ERISA OR THE CODE (COLLECTIVELY, A "PLAN"), MAY RESULT IN
"PROHIBITED TRANSACTIONS" WITHIN THE MEANING OF ERISA, THE CODE OR SIMILAR LAW.
TRANSFER OF THIS CERTIFICATE WILL NOT BE MADE UNLESS THE TRANSFEREE DELIVERS TO
THE TRUSTEE EITHER (I) A REPRESENTATION LETTER, IN FORM AND SUBSTANCE
SATISFACTORY TO THE TRUSTEE, STATING THAT (A) IT IS NOT, AND IS NOT ACTING ON
BEHALF OF, ANY SUCH PLAN OR USING THE ASSETS OF ANY SUCH PLAN TO EFFECT SUCH
PURCHASE OR (B) IF IT IS AN INSURANCE COMPANY, THAT THE SOURCE OF FUNDS USED TO
PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY GENERAL ACCOUNT" (AS SUCH
TERM IS DEFINED IN SECTION V(E) OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60
("PTE 95-60"), 60 FED. REG. 35925 (JULY 12, 1995)), THERE IS NO PLAN WITH
RESPECT TO WHICH THE AMOUNT OF SUCH GENERAL ACCOUNT'S RESERVES AND LIABILITIES
FOR THE CONTRACT(S) HELD BY OR ON BEHALF OF SUCH PLAN AND ALL OTHER PLANS
MAINTAINED BY THE SAME EMPLOYER (OR AFFILIATE THEREOF AS DEFINED IN SECTION
V(A)(1) OF PTE 95-60) OR BY THE SAME EMPLOYEE ORGANIZATION EXCEEDS 10% OF THE
TOTAL OF ALL RESERVES AND LIABILITIES OF SUCH GENERAL ACCOUNT (AS SUCH AMOUNTS
ARE DETERMINED UNDER SECTION I(A) OF PTE 95-60) AT THE DATE OF ACQUISITION AND
ALL PLANS THAT HAVE AN INTEREST IN SUCH GENERAL ACCOUNT ARE PLANS TO WHICH PTE
95-60 APPLIES, OR (II) AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE SATISFACTORY
TO THE TRUSTEE AND THE SERVICER, TO THE EFFECT THAT THE PURCHASE OR HOLDING OF
THIS CERTIFICATE BY OR ON BEHALF OF SUCH PLAN WILL NOT CONSTITUTE OR RESULT IN A
NON-EXEMPT PROHIBITED TRANSACTION WITHIN THE MEANING OF ERISA, SECTION 4975 OF
THE CODE OR SIMILAR LAW AND WILL NOT SUBJECT THE DEPOSITOR, THE SERVICER OR THE
TRUSTEE TO ANY OBLIGATION IN ADDITION TO THOSE UNDERTAKEN IN THE POOLING AND
SERVICING AGREEMENT. EACH PERSON WHO ACQUIRES THIS CERTIFICATE OR ANY INTEREST
THEREIN SHALL BE DEEMED TO HAVE MADE THE REPRESENTATIONS REQUIRED BY THE
REPRESENTATION LETTER REFERRED TO IN THE PRECEDING SENTENCE, UNLESS SUCH PERSON
SHALL HAVE PROVIDED SUCH REPRESENTATION LETTER OR THE OPINION OF COUNSEL
REFERRED TO IN THE PRECEDING SENTENCE TO THE TRUSTEE. THE POOLING AND SERVICING
AGREEMENT PROVIDES THAT ANY ATTEMPTED OR PURPORTED TRANSFER IN VIOLATION OF
THESE TRANSFER RESTRICTIONS WILL BE NULL AND VOID AND WILL VEST NO RIGHTS IN ANY
PURPORTED TRANSFEREE.
REDUCTIONS OF THE CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERENCED HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE LESS THAN THE
AMOUNT SET FORTH BELOW.
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class M-3
evidencing an interest in a Trust consisting primarily of a pool of mortgage
loans (the "Mortgage Loans") secured by first liens on one- to four-family
residential properties deposited by
Banc of America Mortgage Securities, Inc., as Depositor
Certificate No.:
Cut-Off Date: September 1, 2006
First Distribution Date: October 25, 2006
Initial Certificate
Balance of this
Certificate
("Denomination"): $
Initial Class Certificate
Balance of this Class: $3,353,000.00
CUSIP No.: 059469 AJ 5
ISIN No.: US059469AJ58
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 Initial Class Certificate Balance of the Class to which
this Certificate belongs) in certain monthly distributions with respect to a
Trust consisting primarily of the Mortgage Loans deposited by Banc of America
Mortgage Securities, Inc. (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement, dated September 28, 2006 (the "Pooling and
Servicing Agreement"), among the Depositor, Bank of America, National
Association, as servicer (the "Servicer"), and Xxxxx Fargo Bank, N.A., as
trustee (the "Trustee"). To the extent not defined herein, the capitalized terms
used herein have the meanings assigned in the Pooling and Servicing Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
The Certificate Interest Rate for the Class M-3 Certificates for each
Distribution Date will be the lesser of (i) the Class M-3 Pass-Through Rate and
(ii) the Pool Cap. Interest will accrue on the Class M-3 Certificates during
each Interest Accrual Period at the Certificate Interest Rate.
Principal and the Monthly Excess Cashflow Amount in respect of this
Certificate is distributable monthly as set forth in the Pooling and Servicing
Agreement. Accordingly, the Certificate Balance of this Certificate 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 Servicer or the Trustee referred to
below or any of their respective affiliates. Neither this Certificate nor the
Mortgage Loans are guaranteed or insured by any governmental agency or
instrumentality.
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 Pooling
and Servicing Agreement or be valid for any purpose unless manually
authenticated by an authorized signatory of the Trustee.
* * *
EXHIBIT B-4
[FORM OF FACE OF CLASS M-4 CERTIFICATE]
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class M-4
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR 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
BENEFICIAL 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 THE SENIOR CERTIFICATES,
CLASS M-1 CERTIFICATES, CLASS M-2 CERTIFICATES AND CLASS M-3 CERTIFICATES AS
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT.
UNDER CURRENT LAW THE PURCHASE AND HOLDING OF THIS CERTIFICATE BY OR ON BEHALF
OF ANY EMPLOYEE BENEFIT PLAN OR ARRANGEMENT, INCLUDING AN INDIVIDUAL RETIREMENT
ACCOUNT, SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED ("ERISA"), THE CODE OR ANY FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW")
WHICH IS SIMILAR TO ERISA OR THE CODE (COLLECTIVELY, A "PLAN"), MAY RESULT IN
"PROHIBITED TRANSACTIONS" WITHIN THE MEANING OF ERISA, THE CODE OR SIMILAR LAW.
TRANSFER OF THIS CERTIFICATE WILL NOT BE MADE UNLESS THE TRANSFEREE DELIVERS TO
THE TRUSTEE EITHER (I) A REPRESENTATION LETTER, IN FORM AND SUBSTANCE
SATISFACTORY TO THE TRUSTEE, STATING THAT (A) IT IS NOT, AND IS NOT ACTING ON
BEHALF OF, ANY SUCH PLAN OR USING THE ASSETS OF ANY SUCH PLAN TO EFFECT SUCH
PURCHASE OR (B) IF IT IS AN INSURANCE COMPANY, THAT THE SOURCE OF FUNDS USED TO
PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY GENERAL ACCOUNT" (AS SUCH
TERM IS DEFINED IN SECTION V(E) OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60
("PTE 95-60"), 60 FED. REG. 35925 (JULY 12, 1995)), THERE IS NO PLAN WITH
RESPECT TO WHICH THE AMOUNT OF SUCH GENERAL ACCOUNT'S RESERVES AND LIABILITIES
FOR THE CONTRACT(S) HELD BY OR ON BEHALF OF SUCH PLAN AND ALL OTHER PLANS
MAINTAINED BY THE SAME EMPLOYER (OR AFFILIATE THEREOF AS DEFINED IN SECTION
V(A)(1) OF PTE 95-60) OR BY THE SAME EMPLOYEE ORGANIZATION EXCEEDS 10% OF THE
TOTAL OF ALL RESERVES AND LIABILITIES OF SUCH GENERAL ACCOUNT (AS SUCH AMOUNTS
ARE DETERMINED UNDER SECTION I(A) OF PTE 95-60) AT THE DATE OF ACQUISITION AND
ALL PLANS THAT HAVE AN INTEREST IN SUCH GENERAL ACCOUNT ARE PLANS TO WHICH PTE
95-60 APPLIES, OR (II) AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE SATISFACTORY
TO THE TRUSTEE AND THE SERVICER, TO THE EFFECT THAT THE PURCHASE OR HOLDING OF
THIS CERTIFICATE BY OR ON BEHALF OF SUCH PLAN WILL NOT CONSTITUTE OR RESULT IN A
NON-EXEMPT PROHIBITED TRANSACTION WITHIN THE MEANING OF ERISA, SECTION 4975 OF
THE CODE OR SIMILAR LAW AND WILL NOT SUBJECT THE DEPOSITOR, THE SERVICER OR THE
TRUSTEE TO ANY OBLIGATION IN ADDITION TO THOSE UNDERTAKEN IN THE POOLING AND
SERVICING AGREEMENT. EACH PERSON WHO ACQUIRES THIS CERTIFICATE OR ANY INTEREST
THEREIN SHALL BE DEEMED TO HAVE MADE THE REPRESENTATIONS REQUIRED BY THE
REPRESENTATION LETTER REFERRED TO IN THE PRECEDING SENTENCE, UNLESS SUCH PERSON
SHALL HAVE PROVIDED SUCH REPRESENTATION LETTER OR THE OPINION OF COUNSEL
REFERRED TO IN THE PRECEDING SENTENCE TO THE TRUSTEE. THE POOLING AND SERVICING
AGREEMENT PROVIDES THAT ANY ATTEMPTED OR PURPORTED TRANSFER IN VIOLATION OF
THESE TRANSFER RESTRICTIONS WILL BE NULL AND VOID AND WILL VEST NO RIGHTS IN ANY
PURPORTED TRANSFEREE.
REDUCTIONS OF THE CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERENCED HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE LESS THAN THE
AMOUNT SET FORTH BELOW.
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class M-4
evidencing an interest in a Trust consisting primarily of a pool of mortgage
loans (the "Mortgage Loans") secured by first liens on one- to four-family
residential properties deposited by
Banc of America Mortgage Securities, Inc., as Depositor
Certificate No.:
Cut-Off Date: September 1, 2006
First Distribution Date: October 25, 2006
Initial Certificate
Balance of this
Certificate
("Denomination"): $
Initial Class Certificate
Balance of this Class: $3,353,000.00
CUSIP No.: 059469 AK 2
ISIN No.: US059469AK22
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 Initial Class Certificate Balance of the Class to which
this Certificate belongs) in certain monthly distributions with respect to a
Trust consisting primarily of the Mortgage Loans deposited by Banc of America
Mortgage Securities, Inc. (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement, dated September 28, 2006 (the "Pooling and
Servicing Agreement"), among the Depositor, Bank of America, National
Association, as servicer (the "Servicer"), and Xxxxx Fargo Bank, N.A., as
trustee (the "Trustee"). To the extent not defined herein, the capitalized terms
used herein have the meanings assigned in the Pooling and Servicing Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
The Certificate Interest Rate for the Class M-4 Certificates for each
Distribution Date will be the lesser of (i) the Class M-4 Pass-Through Rate and
(ii) the Pool Cap. Interest will accrue on the Class M-4 Certificates during
each Interest Accrual Period at the Certificate Interest Rate.
Principal and the Monthly Excess Cashflow Amount in respect of this
Certificate is distributable monthly as set forth in the Pooling and Servicing
Agreement. Accordingly, the Certificate Balance of this Certificate 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 Servicer or the Trustee referred to
below or any of their respective affiliates. Neither this Certificate nor the
Mortgage Loans are guaranteed or insured by any governmental agency or
instrumentality.
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 Pooling
and Servicing Agreement or be valid for any purpose unless manually
authenticated by an authorized signatory of the Trustee.
* * *
EXHIBIT B-5
[FORM OF FACE OF CLASS M-5 CERTIFICATE]
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class M-5
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR 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
BENEFICIAL 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 THE SENIOR CERTIFICATES,
CLASS M-1 CERTIFICATES, CLASS M-2 CERTIFICATES, CLASS M-3 CERTIFICATES AND CLASS
M-4 CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT.
UNDER CURRENT LAW THE PURCHASE AND HOLDING OF THIS CERTIFICATE BY OR ON BEHALF
OF ANY EMPLOYEE BENEFIT PLAN OR ARRANGEMENT, INCLUDING AN INDIVIDUAL RETIREMENT
ACCOUNT, SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED ("ERISA"), THE CODE OR ANY FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW")
WHICH IS SIMILAR TO ERISA OR THE CODE (COLLECTIVELY, A "PLAN"), MAY RESULT IN
"PROHIBITED TRANSACTIONS" WITHIN THE MEANING OF ERISA, THE CODE OR SIMILAR LAW.
TRANSFER OF THIS CERTIFICATE WILL NOT BE MADE UNLESS THE TRANSFEREE DELIVERS TO
THE TRUSTEE EITHER (I) A REPRESENTATION LETTER, IN FORM AND SUBSTANCE
SATISFACTORY TO THE TRUSTEE, STATING THAT (A) IT IS NOT, AND IS NOT ACTING ON
BEHALF OF, ANY SUCH PLAN OR USING THE ASSETS OF ANY SUCH PLAN TO EFFECT SUCH
PURCHASE OR (B) IF IT IS AN INSURANCE COMPANY, THAT THE SOURCE OF FUNDS USED TO
PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY GENERAL ACCOUNT" (AS SUCH
TERM IS DEFINED IN SECTION V(E) OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60
("PTE 95-60"), 60 FED. REG. 35925 (JULY 12, 1995)), THERE IS NO PLAN WITH
RESPECT TO WHICH THE AMOUNT OF SUCH GENERAL ACCOUNT'S RESERVES AND LIABILITIES
FOR THE CONTRACT(S) HELD BY OR ON BEHALF OF SUCH PLAN AND ALL OTHER PLANS
MAINTAINED BY THE SAME EMPLOYER (OR AFFILIATE THEREOF AS DEFINED IN SECTION
V(A)(1) OF PTE 95-60) OR BY THE SAME EMPLOYEE ORGANIZATION EXCEEDS 10% OF THE
TOTAL OF ALL RESERVES AND LIABILITIES OF SUCH GENERAL ACCOUNT (AS SUCH AMOUNTS
ARE DETERMINED UNDER SECTION I(A) OF PTE 95-60) AT THE DATE OF ACQUISITION AND
ALL PLANS THAT HAVE AN INTEREST IN SUCH GENERAL ACCOUNT ARE PLANS TO WHICH PTE
95-60 APPLIES, OR (II) AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE SATISFACTORY
TO THE TRUSTEE AND THE SERVICER, TO THE EFFECT THAT THE PURCHASE OR HOLDING OF
THIS CERTIFICATE BY OR ON BEHALF OF SUCH PLAN WILL NOT CONSTITUTE OR RESULT IN A
NON-EXEMPT PROHIBITED TRANSACTION WITHIN THE MEANING OF ERISA, SECTION 4975 OF
THE CODE OR SIMILAR LAW AND WILL NOT SUBJECT THE DEPOSITOR, THE SERVICER OR THE
TRUSTEE TO ANY OBLIGATION IN ADDITION TO THOSE UNDERTAKEN IN THE POOLING AND
SERVICING AGREEMENT. EACH PERSON WHO ACQUIRES THIS CERTIFICATE OR ANY INTEREST
THEREIN SHALL BE DEEMED TO HAVE MADE THE REPRESENTATIONS REQUIRED BY THE
REPRESENTATION LETTER REFERRED TO IN THE PRECEDING SENTENCE, UNLESS SUCH PERSON
SHALL HAVE PROVIDED SUCH REPRESENTATION LETTER OR THE OPINION OF COUNSEL
REFERRED TO IN THE PRECEDING SENTENCE TO THE TRUSTEE. THE POOLING AND SERVICING
AGREEMENT PROVIDES THAT ANY ATTEMPTED OR PURPORTED TRANSFER IN VIOLATION OF
THESE TRANSFER RESTRICTIONS WILL BE NULL AND VOID AND WILL VEST NO RIGHTS IN ANY
PURPORTED TRANSFEREE.
REDUCTIONS OF THE CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERENCED HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE BALANCE OF THIS CERTIFICATE MAY BE LESS THAN THE
AMOUNT SET FORTH BELOW.
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class M-5
evidencing an interest in a Trust consisting primarily of a pool of mortgage
loans (the "Mortgage Loans") secured by first liens on one- to four-family
residential properties deposited by
Banc of America Mortgage Securities, Inc., as Depositor
Certificate No.:
Cut-Off Date: September 1, 2006
First Distribution Date: October 25, 2006
Initial Certificate
Balance of this
Certificate
("Denomination"): $
Initial Class Certificate
Balance of this Class: $3,353,000.00
CUSIP No.: 059469 AL 0
ISIN No.: US059469AL05
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 Initial Class Certificate Balance of the Class to which
this Certificate belongs) in certain monthly distributions with respect to a
Trust consisting primarily of the Mortgage Loans deposited by Banc of America
Mortgage Securities, Inc. (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement, dated September 28, 2006 (the "Pooling and
Servicing Agreement"), among the Depositor, Bank of America, National
Association, as servicer (the "Servicer"), and Xxxxx Fargo Bank, N.A., as
trustee (the "Trustee"). To the extent not defined herein, the capitalized terms
used herein have the meanings assigned in the Pooling and Servicing Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
The Certificate Interest Rate for the Class M-5 Certificates for each
Distribution Date will be the lesser of (i) the Class M-5 Pass-Through Rate and
(ii) the Pool Cap. Interest will accrue on the Class M-5 Certificates during
each Interest Accrual Period at the Certificate Interest Rate.
Principal and the Monthly Excess Cashflow Amount in respect of this
Certificate is distributable monthly as set forth in the Pooling and Servicing
Agreement. Accordingly, the Certificate Balance of this Certificate 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 Servicer or the Trustee referred to
below or any of their respective affiliates. Neither this Certificate nor the
Mortgage Loans are guaranteed or insured by any governmental agency or
instrumentality.
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 Pooling
and Servicing Agreement or be valid for any purpose unless manually
authenticated by an authorized signatory of the Trustee.
* * *
EXHIBIT B-6
[FORM OF FACE OF CLASS CE CERTIFICATE]
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class CE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE").
THIS CERTIFICATE WILL NOT BE ENTITLED TO PAYMENT UNTIL SUCH TIME AS DESCRIBED IN
THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE SENIOR CERTIFICATES
AND CLASS M CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT.
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "1933 ACT"). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT
REGISTRATION THEREOF UNDER THE 1933 ACT MAY ONLY BE MADE IN A TRANSACTION
EXEMPTED FROM THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN ACCORDANCE
WITH THE PROVISIONS OF THE POOLING AND SERVICING AGREEMENT REFERENCED HEREIN.
UNDER CURRENT LAW THE PURCHASE AND HOLDING OF THIS CERTIFICATE BY OR ON BEHALF
OF ANY EMPLOYEE BENEFIT PLAN OR ARRANGEMENT, INCLUDING AN INDIVIDUAL RETIREMENT
ACCOUNT, SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED ("ERISA"), THE CODE OR ANY FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW")
WHICH IS SIMILAR TO ERISA OR THE CODE (COLLECTIVELY, A "PLAN"), MAY RESULT IN
"PROHIBITED TRANSACTIONS" WITHIN THE MEANING OF ERISA, THE CODE OR SIMILAR LAW.
TRANSFER OF THIS CERTIFICATE WILL NOT BE MADE UNLESS THE TRANSFEREE DELIVERS TO
THE TRUSTEE EITHER (I) A REPRESENTATION LETTER, IN FORM AND SUBSTANCE
SATISFACTORY TO THE TRUSTEE, STATING THAT (A) IT IS NOT, AND IS NOT ACTING ON
BEHALF OF, ANY SUCH PLAN OR USING THE ASSETS OF ANY SUCH PLAN TO EFFECT SUCH
PURCHASE OR (B) IF IT IS AN INSURANCE COMPANY, THAT THE SOURCE OF FUNDS USED TO
PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY GENERAL ACCOUNT" (AS SUCH
TERM IS DEFINED IN SECTION V(E) OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60
("PTE 95-60"), 60 FED. REG. 35925 (JULY 12, 1995)), THERE IS NO PLAN WITH
RESPECT TO WHICH THE AMOUNT OF SUCH GENERAL ACCOUNT'S RESERVES AND LIABILITIES
FOR THE CONTRACT(S) HELD BY OR ON BEHALF OF SUCH PLAN AND ALL OTHER PLANS
MAINTAINED BY THE SAME EMPLOYER (OR AFFILIATE THEREOF AS DEFINED IN SECTION
V(A)(1) OF PTE 95-60) OR BY THE SAME EMPLOYEE ORGANIZATION EXCEEDS 10% OF THE
TOTAL OF ALL RESERVES AND LIABILITIES OF SUCH GENERAL ACCOUNT (AS SUCH AMOUNTS
ARE DETERMINED UNDER SECTION I(A) OF PTE 95-60) AT THE DATE OF ACQUISITION AND
ALL PLANS THAT HAVE AN INTEREST IN SUCH GENERAL ACCOUNT ARE PLANS TO WHICH PTE
95-60 APPLIES, OR (II) AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE SATISFACTORY
TO THE TRUSTEE AND THE SERVICER, TO THE EFFECT THAT THE PURCHASE OR HOLDING OF
THIS CERTIFICATE BY OR ON BEHALF OF SUCH PLAN WILL NOT CONSTITUTE OR RESULT IN A
NON-EXEMPT PROHIBITED TRANSACTION WITHIN THE MEANING OF ERISA, SECTION 4975 OF
THE CODE OR SIMILAR LAW AND WILL NOT SUBJECT THE DEPOSITOR, THE SERVICER OR THE
TRUSTEE TO ANY OBLIGATION IN ADDITION TO THOSE UNDERTAKEN IN THE POOLING AND
SERVICING AGREEMENT. EACH PERSON WHO ACQUIRES THIS CERTIFICATE OR ANY INTEREST
THEREIN SHALL BE DEEMED TO HAVE MADE THE REPRESENTATIONS REQUIRED BY THE
REPRESENTATION LETTER REFERRED TO IN THE PRECEDING SENTENCE, UNLESS SUCH PERSON
SHALL HAVE PROVIDED SUCH REPRESENTATION LETTER OR THE OPINION OF COUNSEL
REFERRED TO IN THE PRECEDING SENTENCE TO THE TRUSTEE. THE POOLING AND SERVICING
AGREEMENT PROVIDES THAT ANY ATTEMPTED OR PURPORTED TRANSFER IN VIOLATION OF
THESE TRANSFER RESTRICTIONS WILL BE NULL AND VOID AND WILL VEST NO RIGHTS IN ANY
PURPORTED TRANSFEREE.
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class CE
evidencing an interest in a Trust consisting primarily of a pool of mortgage
loans (the "Mortgage Loans") secured by first liens on one- to four-family
residential properties deposited by
Banc of America Mortgage Securities, Inc., as Depositor
Certificate No.:
Cut-off Date: September 1, 2006
First Distribution Date: October 25, 2006
CUSIP No.: 059469 AM 8
ISIN No.: US059469AM87
Percentage Interest:
THIS CERTIFIES THAT __________ is the registered owner of the Percentage
Interest set forth above in certain monthly distributions with respect to a
Trust consisting primarily of the Mortgage Loans deposited by Banc of America
Mortgage Securities, Inc. (the "Depositor"). The Trust was created pursuant to a
Pooling and Servicing Agreement, dated September 28, 2006 (the "Pooling and
Servicing Agreement"), among the Depositor, Bank of America, National
Association, as servicer (the "Servicer"), and Xxxxx Fargo Bank, N.A., as
trustee (the "Trustee"). To the extent not defined herein, the capitalized terms
used herein have the meanings assigned in the Pooling and Servicing Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
The Class CE Certificates are limited in right of payment to certain
collections respecting the Mortgage Loans, all as more specifically set forth in
the Pooling and Servicing Agreement.
This Certificate does not evidence an obligation of, or an interest in,
and is not guaranteed by the Depositor, the Servicer or the Trustee referred to
below or any of their respective affiliates. Neither this Certificate nor the
Mortgage Loans are guaranteed or insured by any governmental agency or
instrumentality.
No transfer of a Certificate of this Class shall be made unless such
transfer is exempt from the registration requirements of the Securities Act of
1933, as amended (the "1933 Act"), and any applicable state securities laws or
is made in accordance with the 1933 Act and such laws. In the event of any such
transfer, (i) unless the transfer is made in reliance on Rule 144A under the
1933 Act, the Trustee or the Depositor may require a written Opinion of Counsel
(which may be in-house counsel) acceptable to and in form and substance
reasonably satisfactory to the Trustee and the Depositor that such transfer may
be made pursuant to an exemption, describing the applicable exemption and the
basis therefor, from the 1933 Act and such laws or is being made pursuant to the
1933 Act and such laws, which Opinion of Counsel shall not be an expense of the
Trustee or the Depositor and (ii) the Trustee shall require a certificate from
the Certificateholder desiring to effect such transfer substantially in the form
attached to the Pooling and Servicing Agreement as Exhibit G-1 and a certificate
from such Certificateholder's prospective transferee substantially in the form
attached to the Pooling and Servicing Agreement either as Exhibit G-2A or as
Exhibit G-2B, which certificates shall not be an expense of the Trustee or the
Depositor; provided that the foregoing requirements under clauses (i) and (ii)
shall not apply to a transfer of a Private Certificate between or among the
Depositor, the Seller, their affiliates or both. The Holder of a Private
Certificate desiring to effect such transfer shall, and does hereby agree to,
indemnify the Trustee and the Depositor against any liability that may result if
the transfer is not so exempt or is not made in accordance with such federal and
state laws.
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 Pooling
and Servicing Agreement or be valid for any purpose unless manually
authenticated by an authorized signatory of the Trustee.
* * *
EXHIBIT B-7
[FORM OF FACE OF CLASS R CERTIFICATE]
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class R
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN TWO "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").
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "1933 ACT"). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT
REGISTRATION THEREOF UNDER THE 1933 ACT MAY ONLY BE MADE IN A TRANSACTION
EXEMPTED FROM THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN ACCORDANCE
WITH THE PROVISIONS OF THE POOLING AND SERVICING AGREEMENT REFERENCED HEREIN.
THIS CLASS R CERTIFICATE MAY NOT BE PURCHASED BY OR TRANSFERRED TO ANY EMPLOYEE
BENEFIT PLAN OR ARRANGEMENT, INCLUDING AN INDIVIDUAL RETIREMENT ACCOUNT, SUBJECT
TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"),
THE CODE OR ANY FEDERAL, STATE OR LOCAL LAW WHICH IS SIMILAR TO ERISA OR THE
CODE (COLLECTIVELY, A "PLAN"), OR A PERSON ACTING ON BEHALF OF OR INVESTING
ASSETS OF A PLAN.
TRANSFER OF THIS CERTIFICATE IS SUBJECT TO CERTAIN TAX RELATED TRANSFER
RESTRICTIONS DESCRIBED HEREIN AND IN THE POOLING AND SERVICING AGREEMENT. ANY
ATTEMPTED OR PURPORTED TRANSFER OF THIS RESIDUAL CERTIFICATE IN VIOLATION OF
SUCH RESTRICTIONS SHALL BE ABSOLUTELY NULL AND VOID AND SHALL VEST NO RIGHTS IN
THE PURPORTED TRANSFEREE.
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7 Mortgage
Pass-Through Certificates, Series 2006-7
Class R
evidencing a 100% Percentage Interest in the distributions allocable to the
Certificate of the above-referenced Class with respect to a Trust consisting
primarily of a pool of mortgage loans (the "Mortgage Loans") secured by first
liens on one- to four-family residential properties deposited by
Banc of America Mortgage Securities, Inc., as Depositor
Certificate No.:
Cut-off Date: September 1, 2006
First Distribution Date: October 25, 2006
Percentage Interest: 100%
THIS CERTIFIES THAT _________ is the registered owner of the Percentage
Interest set forth above in certain monthly distributions with respect to a
Trust consisting of the Mortgage Loans deposited by Banc of America Mortgage
Securities, Inc. (the "Depositor"). The Trust was created pursuant to a Pooling
and Servicing Agreement, dated September 28, 2006 (the "Pooling and Servicing
Agreement"), among the Depositor, Bank of America, National Association, as
servicer (the "Servicer"), and Xxxxx Fargo Bank, N.A., as trustee (the
"Trustee"). To the extent not defined herein, the capitalized terms used herein
have the meanings assigned in the Pooling and Servicing Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing 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
Certificate Account will be made only upon presentment and surrender of this
Class R Certificate at the Corporate Trust Office.
This Certificate does not evidence an obligation of, or an interest in,
and is not guaranteed by the Depositor, the Servicer or the Trustee referred to
below or any of their respective affiliates. Neither this Certificate nor the
Mortgage Loans are guaranteed or insured by any governmental agency or
instrumentality.
Each Person who has or who acquires this Class R Certificate shall be
deemed by the acceptance or acquisition thereof to have agreed to be bound by
the following provisions and the rights of each Person acquiring this Class R
Certificate are expressly subject to the following provisions: (i) each Person
holding or acquiring this Class R Certificate shall be a Permitted Transferee
and shall promptly notify the Trustee of any change or impending change in its
status as a Permitted Transferee; (ii) no Person shall acquire an ownership
interest in this Class R Certificate unless such ownership interest is a pro
rata undivided interest; (iii) in connection with any proposed transfer of this
Class R Certificate, the Trustee shall require delivery to it, in form and
substance satisfactory to it, of an affidavit in the form of Exhibit I to the
Pooling and Servicing Agreement; (iv) notwithstanding the delivery of an
affidavit by a proposed transferee under clause (iii) above, if a Responsible
Officer of the Trustee has actual knowledge that the proposed transferee is not
a Permitted Transferee, no transfer of any Ownership Interest in this Residual
Certificate to such proposed transferee shall be effected; (v) this Residual
Certificate may not be purchased by or transferred to any Person that is not a
U.S. Person, unless (A) such Person holds this Residual Certificate in
connection with the conduct of a trade or business within the United States and
furnishes the transferor and the Trustee with an effective Internal Revenue
Service Form W-8ECI (or any successor thereto) or (B) the transferee delivers to
both the transferor and the Trustee an Opinion of Counsel from a
nationally-recognized tax counsel to the effect that such transfer is in
accordance with the requirements of the Code and the regulations promulgated
thereunder and that such transfer of this Residual Certificate will not be
disregarded for federal income tax purposes; (vi) any attempted or purported
transfer of this Class R Certificate in violation of the provisions of such
restrictions shall be absolutely null and void and shall vest no rights in the
purported transferee; and (vii) if any Person other than a Permitted Transferee
acquires the Class R Certificate in violation of such restrictions, then the
Trustee, based on information provided to the Trustee by the Servicer, will
provide to the Internal Revenue Service, and to the Persons specified in Section
860E(e)(3) and (6) of the Code, information needed to compute the tax imposed
under Section 860E(e) of the Code on transfers of residual interests to
disqualified organizations.
No transfer of a Certificate of this Class shall be made unless such
transfer is exempt from the registration requirements of the Securities Act of
1933, as amended (the "1933 Act"), and any applicable state securities laws or
is made in accordance with the 1933 Act and such laws. In the event of any such
transfer, (i) unless the transfer is made in reliance on Rule 144A under the
1933 Act, the Trustee or the Depositor may require a written Opinion of Counsel
(which may be in-house counsel) acceptable to and in form and substance
reasonably satisfactory to the Trustee and the Depositor that such transfer may
be made pursuant to an exemption, describing the applicable exemption and the
basis therefor, from the 1933 Act and such laws or is being made pursuant to the
1933 Act and such laws, which Opinion of Counsel shall not be an expense of the
Trustee or the Depositor and (ii) the Trustee shall require a certificate from
the Certificateholder desiring to effect such transfer substantially in the form
attached to the Pooling and Servicing Agreement as Exhibit G-1 and a certificate
from such Certificateholder's prospective transferee substantially in the form
attached to the Pooling and Servicing Agreement either as Exhibit G-2A or as
Exhibit G-2B, which certificates shall not be an expense of the Trustee or the
Depositor; provided that the foregoing requirements under clauses (i) and (ii)
shall not apply to a transfer of a Private Certificate between or among the
Depositor, the Seller, their affiliates or both. The Holder of a Private
Certificate desiring to effect such transfer shall, and does hereby agree to,
indemnify the Trustee and the Depositor against any liability that may result if
the transfer is not so exempt or is not made in accordance with such federal and
state laws.
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 Pooling
and Servicing Agreement or be valid for any purpose unless manually
authenticated by an authorized signatory of the Trustee.
* * *
EXHIBIT C
[FORM OF REVERSE OF ALL CERTIFICATES]
BANC OF AMERICA ALTERNATIVE LOAN TRUST 2006-7
Mortgage Pass-Through Certificates
This Certificate is one of a duly authorized issue of Certificates
designated as Banc of America Alternative Loan Trust 2006-7 Mortgage
Pass-Through Certificates, of the Series specified on the face hereof
(collectively, the "Certificates"), and representing a beneficial ownership
interest in the Trust created by the Pooling and Servicing 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 the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Pooling and Servicing
Agreement or, except as expressly provided in the Pooling and Servicing
Agreement, subject to any liability under the Pooling and Servicing Agreement.
This Certificate does not purport to summarize the Pooling and Servicing
Agreement and reference is made to the Pooling and Servicing Agreement for the
interests, rights and limitations of rights, benefits, obligations and duties
evidenced thereby, and the rights, duties and immunities of the Trustee.
Pursuant to the terms of the Pooling and Servicing Agreement, a
distribution will be made on the 25th day of each calendar month (or, if such
day is not a Business Day, the next Business Day) (each, a "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 required pursuant to the Pooling and
Servicing Agreement. The Record Date applicable to each Distribution Date is the
last Business Day of the month next preceding the month of such Distribution
Date.
On each Distribution Date, the Trustee shall distribute out of the
Certificate Account to each Certificateholder of record on the related Record
Date (other than respecting the final distribution) (a) by check mailed to such
Certificateholder entitled to receive a distribution on such Distribution Date
at the address appearing in the Certificate Register, or (b) upon written
request by the Holder of a Regular Certificate, by wire transfer or by such
other means of payment as such Certificateholder and the Trustee shall agree
upon, such Certificateholder's Percentage Interest in the amount to which the
related Class of Certificates is entitled in accordance with the priorities set
forth in Section 5.02 of the Pooling and Servicing Agreement. The final
distribution on each Certificate will be made in like manner, but only upon
presentation and surrender of such Certificate to the Trustee as contemplated by
Section 10.01 of the Pooling and Servicing Agreement.
The Pooling and Servicing Agreement permits, with certain exceptions
therein provided, the amendment thereof and the modification of the rights and
obligations of the Trustee and the rights of the Certificateholders under the
Pooling and Servicing Agreement at any time by the Depositor, the Servicer and
the Trustee with the consent of the Holders of Certificates affected by such
amendment evidencing the requisite Percentage Interest, as provided in the
Pooling and Servicing 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 Pooling and Servicing 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 Pooling and Servicing Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
in the Certificate Register of the Trustee upon surrender of this Certificate
for registration of transfer at the Corporate Trust Office accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations and evidencing the same aggregate
Percentage Interest in the Trust will be issued to the designated transferee or
transferees.
The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Pooling and Servicing Agreement. As
provided in the Pooling and Servicing Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations and evidencing the
same aggregate Percentage Interest, as requested by the Holder surrendering the
same.
No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Depositor, the Servicer, the Certificate Registrar and the Trustee and
any agent of the Depositor, the Servicer, the Certificate Registrar or the
Trustee may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of the Depositor, the Servicer, the
Certificate Registrar, the Trustee or any such agent shall be affected by any
notice to the contrary.
On any Distribution Date on which the aggregate Stated Principal Balance
is less than 10% of the aggregate Cut-off Date Principal Balance, the party
designated in the Pooling and Servicing Agreement will have the option to
repurchase, in whole, from the Trust all remaining Mortgage Loans and all
property acquired in respect of such Mortgage Loans at a purchase price
determined as provided in the Pooling and Servicing Agreement. The 10% may be
reduced by an amendment to the Pooling and Servicing Agreement without
Certificateholder consent under certain conditions set forth in the Pooling and
Servicing Agreement. In the event that no such optional repurchase occurs, the
obligations and responsibilities created by the Pooling and Servicing 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
or the disposition of all property in respect thereof and the distribution to
Certificateholders of all amounts required to be distributed pursuant to the
Pooling and Servicing Agreement. In no event shall the Trust created by the
Pooling and Servicing Agreement continue beyond the expiration of 21 years from
the death of the last survivor of the descendants of Xxxxxx X. Xxxxxxx, the late
ambassador of the United States to the Court of St. Xxxxx, living on the date
thereof.
Any term used herein that is defined in the Pooling and Servicing
Agreement shall have the meaning assigned in the Pooling and Servicing
Agreement, and nothing herein shall be deemed inconsistent with that meaning.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated:
XXXXX FARGO BANK, N.A.,
as Trustee
By
---------------------------------------
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the Pooling and Servicing
Agreement referenced herein.
XXXXX FARGO BANK, N.A.,
as Trustee
By
---------------------------------------
Authorized Signatory
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.
I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:
Dated:
------------------------------------------
Signature by or on behalf of assignor
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to ____________________________________________________ for the
account of ___________________, account number _________________________, or, if
mailed by check, to Applicable statements should be mailed to
_______________________
This information is provided by _______________________, the assignee
named above, or , as its agent.
EXHIBIT D
ADDRESSES FOR REQUESTING MORTGAGE LOAN SCHEDULE
For the Depositor:
Banc of America Mortgage Securities, Inc.
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
NC1-022-05-10
Attn: Secondary Marketing, BoALT 2006-7
For the Trustee:
Xxxxx Fargo Bank, N.A.
0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Attn: BOAALT 2006-7
EXHIBIT E
REQUEST FOR RELEASE OF DOCUMENTS
[date]
To: Xxxxx Fargo Bank, N.A.
0000 00xx Xxxxxx, X.X.
Xxxxxxxxxxx, Xxxxxxxxx 00000-0000
Attn: Inventory Control (BoALT 2006-7)
Re: The Pooling and Servicing Agreement dated September 28, 2006, among
Banc of America Mortgage Securities, Inc., as Depositor, Bank of
America, National Association, as Servicer, and Xxxxx Fargo Bank,
N.A., as Trustee
In connection with the administration of the Mortgage Loans held by you,
as Custodian, pursuant to the above-captioned Pooling and Servicing Agreement,
we request the release, and hereby acknowledge receipt, of the Mortgage File for
the Mortgage Loan described below, for the reason indicated.
Mortgage Loan Number:
---------------------
Mortgagor Name, Address & Zip Code:
-----------------------------------
Reason for Requesting Documents (check one)
____ 1. Mortgage Paid in Full
____ 2. Foreclosure
____ 3. Substitution
____ 4. Other Liquidation
____ 5. Nonliquidation Reason: ___________________
By:
--------------------------------------
(authorized signer of Bank of
America, National Association)
Issuer:
-----------------------------------
Address:
----------------------------------
Date:
-------------------------------------
Custodian
---------
Xxxxx Fargo Bank, N.A.
Please acknowledge the execution of the above request by your signature and date
below:
__________________________________ _______________
Signature Date
Documents returned to Custodian:
___________________________________ ________________
Custodian Date
EXHIBIT F
FORM OF CERTIFICATION OF ESTABLISHMENT OF ACCOUNT
[Date]
[_______________] hereby certifies that it has established a [__________]
Account pursuant to Section [________] of the Pooling and Servicing Agreement,
dated September 28, 2006, among Banc of America Mortgage Securities, Inc., as
Depositor, Bank of America, National Association, as Servicer, and Xxxxx Fargo
Bank, N.A., as Trustee.
[_______________],
By:
--------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
EXHIBIT G-1
FORM OF TRANSFEROR CERTIFICATE
FOR TRANSFERS OF PRIVATE CERTIFICATES
[Date]
Xxxxx Fargo Bank, N.A.
Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000-0000
Attn: Corporate Trust Services - BoALT 2006-7
Re: Banc of America Alternative Loan Trust 2006-7, Mortgage
Pass-Through Certificates, Series 2006-7, Class ___, having an
initial aggregate Certificate Balance as of September 28, 2006
of $___________
Ladies and Gentlemen:
This letter is delivered to you in connection with the transfer by
[______________] (the "Transferor") to [______________] (the "Transferee") of
the captioned Certificates (the "Transferred Certificates"), pursuant to Section
6.02 of the Pooling and Servicing Agreement (the "Pooling and Servicing
Agreement"), dated September 28, 2006, among Banc of America Mortgage
Securities, Inc., as Depositor, Bank of America, National Association, as
Servicer, and Xxxxx Fargo Bank, N.A., as Trustee. All capitalized terms used
herein and not otherwise defined shall have the respective meanings set forth in
the Pooling and Servicing Agreement. The Transferor hereby certifies, represents
and warrants to you, as Trustee, that:
1. The Transferor is the lawful owner of the Transferred
Certificates with the full right to transfer such Certificates free from
any and all claims and encumbrances whatsoever.
2. Neither the Transferor nor anyone acting on its behalf has (a)
offered, transferred, pledged, sold or otherwise disposed of any
Transferred Certificate, any interest in a Transferred Certificate or any
other similar security to any person in any manner, (b) solicited any
offer to buy or accept a transfer, pledge or other disposition of any
Transferred Certificate, any interest in a Transferred Certificate or any
other similar security from any person in any manner, (c) otherwise
approached or negotiated with respect to any Transferred Certificate, any
interest in a Transferred Certificate or any other similar security with
any person in any manner, (d) made any general solicitation with respect
to any Transferred Certificate, any interest in a Transferred Certificate
or any other similar security by means of general advertising or in any
other manner, or (e) taken any other action with respect to any
Transferred Certificate, any interest in a Transferred Certificate or any
other similar security, which (in the case of any of the acts described in
clauses (a) through (e) hereof) would constitute a distribution of the
Transferred Certificates under the Securities Act of 1933, as amended (the
"1933 Act"), would render the disposition of the Transferred Certificates
a violation of Section 5 of the 1933 Act or any state securities laws, or
would require registration or qualification of the Transferred
Certificates pursuant to the 1933 Act or any state securities laws.
Very truly yours,
_________________________________________
(Transferor)
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
EXHIBIT G-2A
FORM I OF TRANSFEREE CERTIFICATE
FOR TRANSFERS OF PRIVATE CERTIFICATES
[Date]
Xxxxx Fargo Bank, N.A.
Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000-0000
Attn: Corporate Trust Services - BoALT 2006-7
Re: Banc of America Alternative Loan Trust 2006-7, Mortgage
Pass-Through Certificates, Series 2006-7, Class ___, having an
initial aggregate Certificate Balance as of September 28, 2006
of $[_________]
Ladies and Gentlemen:
This letter is delivered to you in connection with the transfer by
[_______________] (the "Transferor") to [_________________________________] (the
"Transferee") of the captioned Certificates (the "Transferred Certificates"),
pursuant to Section 6.02 of the Pooling and Servicing Agreement (the "Pooling
and Servicing Agreement"), dated September 28, 2006, among Banc of America
Mortgage Securities, Inc., as Depositor, Bank of America, National Association,
as Servicer, and Xxxxx Fargo Bank, N.A., as Trustee. All capitalized terms used
herein and not otherwise defined shall have the respective meanings set forth in
the Pooling and Servicing Agreement. The Transferor hereby certifies, represents
and warrants to you, as Trustee, that:
1. The Transferee is a "qualified institutional buyer" (a "Qualified
Institutional Buyer") as that term is defined in Rule 144A ("Rule 144A")
under the Securities Act of 1933, as amended (the "1933 Act"), and has
completed one of the forms of certification to that effect attached hereto
as Annex 1 and Annex 2. The Transferee is aware that the sale to it is
being made in reliance on Rule 144A. The Transferee is acquiring the
Transferred Certificates for its own account or for the account of another
Qualified Institutional Buyer, and understands that such Transferred
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 another 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 1933 Act.
2. The Transferee has been furnished with all information regarding
(a) the Depositor, (b) the Transferred Certificates and distributions
thereon, (c) the nature, performance and servicing of the Mortgage Loans,
(d) the Pooling and Servicing Agreement and the Trust created pursuant
thereto, (e) any credit enhancement mechanism associated with the
Transferred Certificate, and (f) all related matters, that it has
requested.
3. If the Transferee proposes that the Transferred Certificates be
registered in the name of a nominee, such nominee has completed the
Nominee Acknowledgment below.
Very truly yours,
__________________________________________
(Transferor)
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
Nominee Acknowledgment
The undersigned hereby acknowledges and agrees that as to the Transferred
Certificates being registered in its name, the sole beneficial owner thereof is
and shall be the Transferee identified above, for whom the undersigned is acting
as nominee.
__________________________________________
(Nominee)
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
ANNEX 1 TO EXHIBIT G-2A
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees Other Than Registered Investment Companies]
The undersigned hereby certifies as follows to [__________________] (the
"Transferor") and Xxxxx Fargo Bank, N.A., as Trustee, with respect to the
mortgage pass-through certificates (the "Transferred Certificates") described in
the Transferee certificate to which this certification relates and to which this
certification is an Annex:
1. As indicated below, the undersigned is the chief financial officer, a
person fulfilling an equivalent function, or other executive officer of the
entity purchasing the Transferred Certificates (the "Transferee").
2. The Transferee is a "qualified institutional buyer" as that term is
defined in Rule 144A ("Rule 144A") under the Securities Act of 1933, as amended,
because (i) the Transferee owned and/or invested on a discretionary basis
$______________________(1) in securities (other than the excluded securities
referred to below) as of the end of the Transferee's most recent fiscal year
(such amount being calculated in accordance with Rule 144A) and (ii) the
Transferee satisfies the criteria in the category marked below.
___ Corporation, etc. The Transferee is a corporation (other than a
bank, savings and loan association or similar institution),
Massachusetts or similar business trust, partnership, or any
organization described in Section 501(c)(3) of the Internal Revenue
Code of 1986.
___ Bank. The Transferee (a) is a national bank or a banking institution
organized under the laws of any state, U.S. territory or the
District of Columbia, the business of which is substantially
confined to banking and is supervised by the state or territorial
banking commission or similar official or is a foreign bank or
equivalent institution, and (b) has an audited net worth of at least
$25,000,000 as demonstrated in its latest annual financial
statements, a copy of which is attached hereto, as of a date not
more than 16 months preceding the date of sale of the Transferred
Certificates in the case of a U.S. bank, and not more than 18 months
preceding such date of sale in the case of a foreign bank or
equivalent institution.
___ Savings and Loan. The Transferee (a) is a savings and loan
association, building and loan association, cooperative bank,
homestead association or similar institution, which is supervised
and examined by a state or federal authority having supervision over
any such institutions, or is a foreign savings and loan association
or equivalent institute and (b) has an audited net worth of at least
$25,000,000 as demonstrated in its latest annual financial
statements, a copy of which is attached hereto, as of a date not
more than 16 months preceding the date of sale of the Transferred
Certificates in the case of a U.S. savings and loan association, and
not more than 18 months preceding such date of sale in the case of a
foreign savings and loan association or equivalent institution.
___ Broker-dealer. The Transferee is a dealer registered pursuant to
Section 15 of the Securities Exchange Act of 1934, as amended.
___ Insurance Company. The Transferee is an insurance company whose
primary and predominant business activity is the writing of
insurance or the reinsuring of risks underwritten by insurance
companies and which is subject to supervision by the insurance
commissioner or a similar official or agency of a state, U.S.
territory or the District of Columbia.
___ State or Local Plan. The Transferee is a plan established and
maintained by a state, its political subdivisions, or any agency or
instrumentality of the state or its political subdivisions, for the
benefit of its employees.
___ ERISA Plan. The Transferee is an employee benefit plan within the
meaning of Title I of the Employee Retirement Income Security Act of
1974.
___ Investment Advisor. The Transferee is an investment advisor
registered under the Investment Advisers Act of 1940.
___ Other. (Please supply a brief description of the entity and a
cross-reference to the paragraph and subparagraph under subsection
(a)(1) of Rule 144A pursuant to which it qualifies. Note that
registered investment companies should complete Annex 2 rather than
this Annex 1.)
3. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Transferee, (ii) securities that are part
of an unsold allotment to or subscription by the Transferee, if the Transferee
is a dealer, (iii) bank deposit notes and certificates of deposit, (iv) loan
participations, (v) repurchase agreements, (vi) securities owned but subject to
a repurchase agreement and (vii) currency, interest rate and commodity swaps.
For purposes of determining the aggregate amount of securities owned and/or
invested on a discretionary basis by the Transferee, the Transferee did not
include any of the securities referred to in this paragraph.
4. For purposes of determining the aggregate amount of securities owned
and/or invested on a discretionary basis by the Transferee, the Transferee used
the cost of such securities to the Transferee, unless the Transferee reports its
securities holdings in its financial statements on the basis of their market
value, and no current information with respect to the cost of those securities
has been published, in which case the securities were valued at market. Further,
in determining such aggregate amount, the Transferee may have included
securities owned by subsidiaries of the Transferee, but only if such
subsidiaries are consolidated with the Transferee in its financial statements
prepared in accordance with generally accepted accounting principles and if the
investments of such subsidiaries are managed under the Transferee's direction.
However, such securities were not included if the Transferee is a
majority-owned, consolidated subsidiary of another enterprise and the Transferee
is not itself a reporting company under the Securities Exchange Act of 1934, as
amended.
5. The Transferee is familiar with Rule 144A and understands that the
Transferor and other parties related to the Transferred Certificates are relying
and will continue to rely on the statements made herein because one or more
sales to the Transferee may be in reliance on Rule 144A.
____ ____ Will the Transferee be purchasing the
Yes No Transferred Certificates only for the
Transferee's own account?
6. If the answer to the foregoing question is "no," then in each case
where the Transferee is purchasing for an account other than its own, such
account belongs to a third party that is itself a "qualified institutional
buyer" within the meaning of Rule 144A, and the "qualified institutional buyer"
status of such third party has been established by the Transferee through one or
more of the appropriate methods contemplated by Rule 144A.
7. The Transferee will notify each of the parties to which this
certification is made of any changes in the information and conclusions herein.
Until such notice is given, the Transferee's purchase of the Transferred
Certificates will constitute a reaffirmation of this certification as of the
date of such purchase. In addition, if the Transferee is a bank or savings and
loan as provided above, the Transferee agrees that it will furnish to such
parties any updated annual financial statements that become available on or
before the date of such purchase, promptly after they become available.
__________________________________________
Print Name of Transferee
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
Date:
-------------------------------------
ANNEX 2 TO EXHIBIT G-2A
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees That Are Registered Investment Companies]
The undersigned hereby certifies as follows to [_________________] (the
"Transferor") and Xxxxx Fargo Bank, N.A., as Trustee, with respect to the
mortgage pass-through certificates (the "Transferred Certificates") described in
the Transferee certificate to which this certification relates and to which this
certification is an Annex:
1. As indicated below, the undersigned is the chief financial officer, a
person fulfilling an equivalent function, or other executive officer of the
entity purchasing the Transferred Certificates (the "Transferee") or, if the
Transferee is a "qualified institutional buyer" as that term is defined in Rule
144A ("Rule 144A") under the Securities Act of 1933, as amended, because the
Transferee is part of a Family of Investment Companies (as defined below), is an
executive officer of the investment adviser (the "Adviser").
2. The Transferee is a "qualified institutional buyer" as defined in Rule
144A because (i) the Transferee is an investment company registered under the
Investment Company Act of 1940, and (ii) as marked below, the Transferee alone
owned and/or invested on a discretionary basis, or the Transferee's Family of
Investment Companies owned, at least $100,000,000 in securities (other than the
excluded securities referred to below) as of the end of the Transferee's most
recent fiscal year. For purposes of determining the amount of securities owned
by the Transferee or the Transferee's Family of Investment Companies, the cost
of such securities was used, unless the Transferee or any member of the
Transferee's Family of Investment Companies, as the case may be, reports its
securities holdings in its financial statements on the basis of their market
value, and no current information with respect to the cost of those securities
has been published, in which case the securities of such entity were valued at
market.
____ The Transferee owned and/or invested on a discretionary basis
$____________________ in securities (other than the excluded
securities referred to below) as of the end of the Transferee's most
recent fiscal year (such amount being calculated in accordance with
Rule 144A).
____ The Transferee is part of a Family of Investment Companies which
owned in the aggregate $__________________ in securities (other than
the excluded securities referred to below) as of the end of the
Transferee's most recent fiscal year (such amount being calculated
in accordance with Rule 144A).
3. The term "Family of Investment Companies" as used herein means two or
more registered investment companies (or series thereof) that have the same
investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).
4. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Transferee or are part of the Transferee's
Family of Investment Companies, (ii) bank deposit notes and certificates of
deposit, (iii) loan participations, (iv) repurchase agreements, (v) securities
owned but subject to a repurchase agreement and (vi) currency, interest rate and
commodity swaps. For purposes of determining the aggregate amount of securities
owned and/or invested on a discretionary basis by the Transferee, or owned by
the Transferee's Family of Investment Companies, the securities referred to in
this paragraph were excluded.
5. The Transferee is familiar with Rule 144A and understands that the
Transferor and other parties related to the Transferred Certificates are relying
and will continue to rely on the statements made herein because one or more
sales to the Transferee will be in reliance on Rule 144A.
____ ____ Will the Transferee be purchasing the
Yes No Transferred Certificates only for the
Transferee's own account?
6. If the answer to the foregoing question is "no," then in each case
where the Transferee is purchasing for an account other than its own, such
account belongs to a third party that is itself a "qualified institutional
buyer" within the meaning of Rule 144A, and the "qualified institutional buyer"
status of such third party has been established by the Transferee through one or
more of the appropriate methods contemplated by Rule 144A.
7. The undersigned will notify the parties to which this certification is
made of any changes in the information and conclusions herein. Until such
notice, the Transferee's purchase of the Transferred Certificates will
constitute a reaffirmation of this certification by the undersigned as of the
date of such purchase.
__________________________________________
Print Name of Transferee or Adviser
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
IF AN ADVISER:
__________________________________________
Print Name of Transferee
By:
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Date:
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EXHIBIT G-2B
FORM II OF TRANSFEREE CERTIFICATE
FOR TRANSFERS OF PRIVATE CERTIFICATES
[Date]
Xxxxx Fargo Bank, N.A.
Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000-0000
Attn: Corporate Trust Services - BoALT 2006-7
Re: Banc of America Alternative Loan Trust 2006-7, Mortgage
Pass-Through Certificates, Series 2006-7, Class ___, having an
initial aggregate Certificate Principal Balance as of
September 28, 2006 of $_________
Ladies and Gentlemen:
This letter is delivered to you in connection with the transfer by
[_______________________] (the "Transferor") to
[_________________________________] (the "Transferee") of the captioned
Certificates (the "Transferred Certificates"), pursuant to Section 6.02 of the
Pooling and Servicing Agreement (the "Pooling and Servicing Agreement"), dated
September 28, 2006, among Banc of America Mortgage Securities, Inc., as
Depositor, Bank of America, National Association, as Servicer, and Xxxxx Fargo
Bank, N.A., as Trustee. All capitalized terms used herein and not otherwise
defined shall have the respective meanings set forth in the Pooling and
Servicing Agreement. The Transferor hereby certifies, represents and warrants to
you, as Trustee, that:
1. Transferee is acquiring the Transferred Certificates for its own
account for investment and not with a view to or for sale or transfer in
connection with any distribution thereof, in whole or in part, in any manner
which would violate the Securities Act of 1933, as amended (the "1933 Act"), or
any applicable state securities laws.
2. Transferee understands that (a) the Transferred Certificates have not
been and will not be registered under the 1933 Act or registered or qualified
under any applicable state securities laws, (b) neither the Depositor nor the
Trustee is obligated so to register or qualify the Transferred Certificates and
(c) neither the Transferred Certificates nor any security issued in exchange
therefor or in lieu thereof may be resold or transferred unless such resale or
transfer is exempt from the registration requirements of the 1933 Act and any
applicable state securities laws or is made in accordance with the 1933 Act and
laws, in which case (i) unless the transfer is made in reliance on Rule 144A
under the 1933 Act, the Trustee or the Depositor may require a written Opinion
of Counsel (which may be in-house counsel) acceptable to and in form and
substance reasonably satisfactory to the Trustee and the Depositor that such
transfer may be made pursuant to an exemption, describing the applicable
exemption and the basis therefor, from the 1933 Act and such laws or is being
made pursuant to the 1933 Act and such laws, which Opinion of Counsel shall not
be an expense of the Trustee or the Depositor and (ii) the Trustee shall require
a certificate from the Certificateholder desiring to effect such transfer
substantially in the form attached to the Pooling and Servicing Agreement as
Exhibit G-1 and a certificate from such Certificateholder's prospective
transferee substantially in the form attached to the Pooling and Servicing
Agreement either as Exhibit G-2A or as Exhibit G-2B, which certificates shall
not be an expense of the Trustee or the Depositor; provided that the foregoing
requirements under clauses (i) and (ii) shall not apply to a transfer of a
Private Certificate between or among the Depositor, the Seller, their affiliates
or both.
3. The Transferee understands that it may not sell or otherwise transfer
the Transferred Certificates, any security issued in exchange therefor or in
lieu thereof or any interest in the foregoing except in compliance with the
provisions of Section 6.02 of the Pooling and Servicing Agreement, which
provisions it has carefully reviewed, and that the Transferred Certificates will
bear legends substantially to the following effect:
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "1933 ACT"). ANY RESALE OR TRANSFER OF THIS CERTIFICATE
WITHOUT REGISTRATION THEREOF UNDER THE 1933 ACT MAY ONLY BE MADE IN A
TRANSACTION EXEMPTED FROM THE REGISTRATION REQUIREMENTS OF THE 1933 ACT
AND IN ACCORDANCE WITH THE PROVISIONS OF THE POOLING AND SERVICING
AGREEMENT REFERENCED HEREIN.
UNDER CURRENT LAW THE PURCHASE AND HOLDING OF THIS CERTIFICATE BY OR ON
BEHALF OF ANY EMPLOYEE BENEFIT PLAN OR ARRANGEMENT, INCLUDING AN
INDIVIDUAL RETIREMENT ACCOUNT, SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA"), THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE"), OR ANY FEDERAL, STATE OR LOCAL LAW
("SIMILAR LAW") WHICH IS SIMILAR TO ERISA OR THE CODE (COLLECTIVELY, A
"PLAN"), MAY RESULT IN "PROHIBITED TRANSACTIONS" WITHIN THE MEANING OF
ERISA, THE CODE OR SIMILAR LAW. TRANSFER OF THIS CERTIFICATE WILL NOT BE
MADE UNLESS THE TRANSFEREE DELIVERS TO THE TRUSTEE EITHER (I) A
REPRESENTATION LETTER, IN FORM AND SUBSTANCE SATISFACTORY TO THE TRUSTEE,
STATING THAT (A) IT IS NOT, AND IS NOT ACTING ON BEHALF OF, ANY SUCH PLAN
OR USING THE ASSETS OF ANY SUCH PLAN TO EFFECT SUCH PURCHASE OR (B) IF IT
IS AN INSURANCE COMPANY, THAT THE SOURCE OF FUNDS USED TO PURCHASE THIS
CERTIFICATE IS AN "INSURANCE COMPANY GENERAL ACCOUNT" (AS SUCH TERM IS
DEFINED IN SECTION V(E) OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60
("PTE 95-60"), 60 FED. REG. 35925 (JULY 12, 1995)), THERE IS NO BENEFIT
PLAN WITH RESPECT TO WHICH THE AMOUNT OF SUCH GENERAL ACCOUNT'S RESERVES
AND LIABILITIES FOR THE CONTRACT(S) HELD BY OR ON BEHALF OF SUCH BENEFIT
PLAN AND ALL OTHER BENEFIT PLANS MAINTAINED BY THE SAME EMPLOYER (OR
AFFILIATE THEREOF AS DEFINED IN SECTION V(A)(1) OF PTE 95-60) OR BY THE
SAME EMPLOYEE ORGANIZATION EXCEEDS 10% OF THE TOTAL OF ALL RESERVES AND
LIABILITIES OF SUCH GENERAL ACCOUNT (AS SUCH AMOUNTS ARE DETERMINED UNDER
SECTION I(A) OF PTE 95-60) AT THE DATE OF ACQUISITION AND ALL PLANS THAT
HAVE AN INTEREST IN SUCH GENERAL ACCOUNT ARE PLANS TO WHICH PTE 95-60
APPLIES, OR (II) AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE SATISFACTORY
TO THE TRUSTEE AND THE SERVICER, TO THE EFFECT THAT THE PURCHASE OR
HOLDING OF THIS CERTIFICATE BY OR ON BEHALF OF SUCH PLAN WILL NOT
CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION WITHIN THE
MEANING OF ERISA, SECTION 4975 OF THE CODE OR SIMILAR LAW AND WILL NOT
SUBJECT THE DEPOSITOR, THE SERVICER OR THE TRUSTEE TO ANY OBLIGATION IN
ADDITION TO THOSE UNDERTAKEN IN THE POOLING AND SERVICING AGREEMENT. EACH
PERSON WHO ACQUIRES THIS CERTIFICATE OR ANY INTEREST THEREIN SHALL BE
DEEMED TO HAVE MADE THE REPRESENTATIONS REQUIRED BY THE REPRESENTATION
LETTER REFERRED TO IN THE PRECEDING SENTENCE UNLESS SUCH PERSON SHALL HAVE
PROVIDED SUCH REPRESENTATION LETTER OR THE OPINION OF COUNSEL REFERRED TO
IN THE PRECEDING SENTENCE TO THE TRUSTEE. THE POOLING AND SERVICING
AGREEMENT PROVIDES THAT ANY ATTEMPTED OR PURPORTED TRANSFER IN VIOLATION
OF THESE TRANSFER RESTRICTIONS WILL BE NULL AND VOID AND WILL VEST NO
RIGHTS IN ANY PURPORTED TRANSFEREE.
4. Neither the Transferee nor anyone acting on its behalf has (a) offered,
transferred, pledged, sold or otherwise disposed of any Transferred Certificate,
any interest in a Transferred Certificate or any other similar security to any
person in any manner, (b) solicited any offer to buy or accept a transfer,
pledge or other disposition of any Transferred Certificate, any interest in a
Transferred Certificate or any other similar security from any person in any
manner, (c) otherwise approached or negotiated with respect to any Transferred
Certificate, any interest in a Transferred Certificate or any other similar
security with any person in any manner, (d) made any general solicitation by
means of general advertising or in any other manner, or (e) taken any other
action, that (in the case of any of the acts described in clauses (a) through
(e) above) would constitute a distribution of the Transferred Certificates under
the 1933 Act, would render the disposition of the Transferred Certificates a
violation of Section 5 of the 1933 Act or any state securities law or would
require registration or qualification of the Transferred Certificates pursuant
thereto. The Transferee will not act, nor has it authorized nor will it
authorize any person to act, in any manner set forth in the foregoing sentence
with respect to the Transferred Certificates, any interest in the Transferred
Certificates or any other similar security.
5. The Transferee has been furnished with all information regarding (a)
the Depositor, (b) the Transferred Certificates and distributions thereon, (c)
nature, performance and servicing of the Mortgage Loans., (d) the Pooling and
Servicing Agreement and the Trust created pursuant thereto, (e) any credit
enhancement mechanism associated with the Transferred Certificates, and (f) all
related matters, that it has requested.
6. The Transferee is an "accredited investor" within the meaning of
paragraph (1), (2), (3) or (7) of Rule 501 (a) under the 1933 Act or an entity
in which all the equity owners come within such paragraphs and has such
knowledge and experience in financial and business matters as to be capable of
evaluating the merits and risks of an investment in the Transferred
Certificates; the Transferee has sought such accounting, legal and tax advice as
it has considered necessary to make an informed investment decision; and the
Transferee is able to bear the economic risks of such an investment and can
afford a complete loss of such investment.
7. If the Transferee proposes that the Transferred Certificates be
registered in the name of a nominee, such nominee has completed the Nominee
Acknowledgment below.
Very truly yours,
__________________________________________
Transferee
By:
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Name:
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Title:
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Date:
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Nominee Acknowledgment
The undersigned hereby acknowledges and agrees that as to the Transferred
Certificates being registered in its name, the sole beneficial owner thereof is
and shall be the Transferee identified above, for whom the undersigned is acting
as nominee.
__________________________________________
(Nominee)
By:
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Name:
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Title:
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Date:
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EXHIBIT H
FORM OF TRANSFEREE REPRESENTATION LETTER
FOR ERISA RESTRICTED CERTIFICATES
Xxxxx Fargo Bank, N.A.
Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000-0000
Attn: Corporate Trust Services - BoALT 2006-7
Re: Banc of America Alternative Loan Trust 2006-7, Mortgage
Pass-Through Certificates, Series 2006-7, Class ___, having an
initial aggregate Certificate Principal Balance as of
September 28, 2006 of $_________
Ladies and Gentlemen:
This letter is delivered to you in connection with the transfer by
[_______________________] (the "Transferor") to
[________________________________] (the "Transferee") of the captioned
Certificates (the "Transferred Certificates"), pursuant to Section 6.02 of the
Pooling and Servicing Agreement (the "Pooling and Servicing Agreement"), dated
September 28, 2006, among Banc of America Mortgage Securities, Inc., as
Depositor, Bank of America, National Association, as Servicer, and Xxxxx Fargo
Bank, N.A., as Trustee. All capitalized terms used herein and not otherwise
defined shall have the respective meanings set forth in the Pooling and
Servicing Agreement.
The Transferee hereby certifies, represents and warrants to you, as
Trustee, either that:
(a) it is not, and is not acting on behalf of, an employee benefit plan or
arrangement, including an individual retirement account, subject to the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), the Internal
Revenue Code of 1986, as amended (the "Code"), or any federal, state or local
law ("Similar Law") which is similar to ERISA or the Code (collectively, a
"Plan"), and it is not using the assets of any such Plan to effect the purchase
of the Transferred Certificates; or
(b) it is an insurance company and the source of funds used to purchase
the Transferred Certificates is an "insurance company general account" (as
defined in Section V(e) of Prohibited Transaction Class Exemption 95-60 ("PTE
95-60"), 60 Fed. Reg. 35925 (July 12, 1995)), there is no Plan with respect to
which the amount of such general account's reserves and liabilities for the
contract(s) held by or on behalf of such Plan and all other Plans maintained by
the same employer (or affiliate thereof as defined in Section V(a)(1) of PTE
95-60) or by the same employee organization exceeds 10% of the total of all
reserves and liabilities of such general account (as such amounts are determined
under Section I(a) of PTE 95-60) at the date of acquisition and all Plans that
have an interest in such general account are Plans to which PTE 95-60 applies.
Capitalized terms used in and not otherwise defined herein shall have the
meaning assigned to them in the Pooling and Servicing Agreement.
Very truly yours,
__________________________________________
Transferee
By:
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Name:
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Title:
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Date:
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EXHIBIT I
FORM OF AFFIDAVIT REGARDING TRANSFER OF
RESIDUAL CERTIFICATE PURSUANT TO SECTION 6.02
Banc of America Alternative Loan Trust 2006-7
Mortgage Pass-Through Certificates,
Series 2006-7
STATE OF )
) ss:
COUNTY OF )
The undersigned, being first duly sworn, deposes and says as follows:
1. The undersigned is an officer of _______________________________, the
proposed transferee (the "Transferee") of the Class R Certificate (the "Residual
Certificate") issued pursuant to the Pooling and Servicing Agreement, dated
September 28, 2006, (the "Agreement"), relating to the above-referenced Series,
by and among Banc of America Mortgage Securities, Inc., as depositor (the
"Depositor"), Bank of America, National Association, as servicer, and Xxxxx
Fargo Bank, N.A., as trustee. Capitalized terms used but not defined herein
shall have the meanings ascribed to such terms in the Agreement. The Transferee
has authorized the undersigned to make this affidavit on behalf of the
Transferee.
2. The Transferee is, as of the date hereof, and will be, as of the date
of the transfer, a Permitted Transferee. The Transferee is acquiring the
Residual Certificate either (i) for its own account or (ii) as nominee, trustee
or agent for another Person who is a Permitted Transferee and has attached
hereto an affidavit from such Person in substantially the same form as this
affidavit. The Transferee has no knowledge that any such affidavit is false.
3. The Transferee has been advised of, and understands that (i) a tax will
be imposed on Transfers of the Residual Certificate to Persons that are not
Permitted Transferees; (ii) such tax will be imposed on the transferor, or, if
such transfer is through an agent (which includes a broker, nominee or
middleman) for a Person that is not a Permitted Transferee, on the agent; and
(iii) the Person otherwise liable for the tax shall be relieved of liability for
the tax if the subsequent Transferee furnished to such Person an affidavit that
such subsequent Transferee is a Permitted Transferee and, at the time of
transfer, such Person does not have actual knowledge that the affidavit is
false.
4. The Transferee has been advised of, and understands that a tax will be
imposed on a "pass-through entity" holding the Certificate if at any time during
the taxable year of the pass-through entity a Person that is not a Permitted
Transferee is the record Holder of an interest in such entity. The Transferee
understands that, other than in the case of an "electing large partnership"
under Section 775 of the Code, such tax will not be imposed for any period with
respect to which the record Holder furnishes to the pass-through entity an
affidavit that such record Holder is a Permitted Transferee and the pass-through
entity does not have actual knowledge that such affidavit is false. (For this
purpose, a "pass-through entity" includes a regulated investment company, a real
estate investment trust or common trust fund, a partnership, trust or estate,
and certain cooperatives and, except as may be provided in Treasury Regulations,
persons holding interests in pass-through entities as a nominee for another
Person.)
5. The Transferee has reviewed the provisions of Section 6.02 of the
Agreement and understands the legal consequences of the acquisition of the
Residual Certificate including, without limitation, the restrictions on
subsequent Transfers and the provisions regarding voiding the transfer and
mandatory sales. The Transferee expressly agrees to be bound by and to abide by
the provisions of Section 6.02 of the Agreement and the restrictions noted on
the face of the Certificate. The Transferee understands and agrees that any
breach of any of the representations included herein shall render the transfer
to the Transferee contemplated hereby null and void.
6. The Transferee agrees to require a transfer affidavit in the form of
this Affidavit from any Person to whom the Transferee attempts to transfer the
Residual Certificate, and in connection with any transfer by a Person for whom
the Transferee is acting as nominee, trustee or agent, and the Transferee will
not transfer the Residual Certificate or cause the Residual Certificate to be
transferred to any Person that the Transferee knows is not a Permitted
Transferee.
7. The Transferee historically has paid its debts as they have become due.
8. The Transferee does not have the intention to impede the assessment or
collection of any tax legally required to be paid with respect to the Residual
Certificate.
9. The taxpayer identification number of the Transferee's nominee is
___________.
10. The Transferee is a U.S. Person as defined in Code Section
7701(a)(30).
11. The Transferee is aware that the Residual Certificate may be a
"noneconomic residual interest" 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, unless no significant purpose of the transfer
was to impede the assessment or collection of tax.
12. The Transferee will not cause income from the Residual Certificate to
be attributable to a foreign permanent establishment or fixed base, within the
meaning of an applicable income tax treaty, of the Transferee or any other
person.
13. If the Transferee is purchasing the Residual Certificate in a transfer
intended to meet the safe harbor provisions of Treasury Regulations Sections
1.860E-1(c), the Transferee has executed and attached Attachment A hereto.
14. The Transferee is not an employee benefit plan or arrangement,
including an individual retirement account, subject to ERISA, the Code or any
federal, state or local law which is similar to ERISA or the Code, and the
Transferee is not acting on behalf of such a plan or arrangement.
* * *
IN WITNESS WHEREOF, the Transferee has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by its
duly authorized officer this _____ day of ________________, ____.
______________________________________
Print Name of Transferee
By:
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Name:
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Title:
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Personally appeared before me the above-named _________________________,
known or proved to me to be the same person who executed the foregoing
instrument and to be the _______________________ of the Transferee, and
acknowledged that he executed the same as his free act and deed and the free act
and deed of the Transferee.
Subscribed and sworn before me this _____ day of _______________________,
____
NOTARY PUBLIC
My Commission expires the ____ day of
______________, ____
ATTACHMENT A
to
AFFIDAVIT PURSUANT TO SECTION 860E(e)(4) OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED, AND FOR NON-ERISA INVESTORS
Check the appropriate box:
|_| The consideration paid to the Transferee to acquire the Residual
Certificate equals or exceeds the excess of (a) the present value of the
anticipated tax liabilities over (b) the present value of the anticipated
savings associated with holding such Residual Certificate, in each case
calculated in accordance with U.S. Treasury Regulations Sections
1.860E-1(c)(7) and (8), computing present values using a discount rate
equal to the short-term Federal rate prescribed by Section 1274(d) of the
Code and the compounding period used by the Transferee.
OR
|_| The transfer of the Residual Certificate complies with U.S. Treasury
Regulations Sections 1.860E-1(c)(5) and (6) and, accordingly:
(i) the Transferee is an "eligible corporation," as defined in U.S.
Treasury Regulations Section 1.860E-1(c)(6)(i), as to which income
from Residual Certificate will only be taxed in the United States;
(ii) at the time of the transfer, and at the close of the Transferee's
two fiscal years preceding the year of the transfer, the Transferee
had gross assets for financial reporting purposes (excluding any
obligation of a person related to the Transferee within the meaning
of U.S. Treasury Regulations Section 1.860E-1(c)(6)(ii)) in excess
of $100 million and net assets in excess of $10 million;
(iii) the Transferee will transfer the Residual Certificate only to
another "eligible corporation," as defined in U.S. Treasury
Regulations Section 1.860E-1(c)(6)(i), in a transaction that
satisfies the requirements of Sections 1.860E-1(c)(4)(i), (ii) and
(iii) and Section 1.860E-1(c)(5) of the U.S. Treasury Regulations;
(iv) the Transferee has determined the consideration paid to it to
acquire the Residual Certificate based on reasonable market
assumptions (including, but not limited to, borrowing and investment
rates, prepayment and loss assumptions, expense and reinvestment
assumptions, tax rates and other factors specific to the Transferee)
that it has determined in good faith; and
(v) in the event of any transfer of the Residual Certificate by the
Transferee, the Transferee will require its transferee to complete a
representation in the form of this Attachment A as a condition of
such transferee's purchase of the Residual Certificate.
EXHIBIT J
CONTENTS OF THE SERVICING FILE
1. Copies of Mortgage Loans Documents.
2. Residential loan application.
3. Mortgage Loan closing statement.
4. Verification of employment and income, if required.
5. Verification of acceptable evidence of source and amount of downpayment.
6. Credit report on Mortgagor, in a form acceptable to either Xxxxxx Xxx or
Xxxxxxx Mac.
7. Residential appraisal report.
8. Photograph of the Mortgaged Property.
9. Survey of the Mortgaged Property, unless a survey is not required by the
title insurer.
10. Copy of each instrument necessary to complete identification of any
exception set forth in the exception schedule in the title policy, i.e.,
map or plat, restrictions, easements, home owner association declarations,
etc.
11. Copies of all required disclosure statements.
12. If applicable, termite report, structural engineer's report, water
potability and septic certification.
13. Sales Contract, if applicable.
14. The Primary Insurance Policy or certificate of insurance or an electronic
notation of the existence of such policy, where required pursuant to the
Agreement.
15. Evidence of electronic notation of the hazard insurance policy, and if
required by law, evidence of the flood insurance policy.
EXHIBIT K
FORM OF SPECIAL SERVICING AGREEMENT
This Special Servicing Agreement (the "Agreement") is made and entered
into as of ___________________, between Bank of America, National Association
(the "Servicer") and ___________________ (the "Loss Mitigation Advisor").
PRELIMINARY STATEMENT
_________________ (the "Purchaser") is the holder of the entire interest
in Banc of America Alternative Loan Trust 2006-7; Mortgage Pass-Through
Certificates, Series ______, Class ____ (the "Class M Certificates"). The Class
M Certificates were issued pursuant to a Pooling and Servicing Agreement dated
___________________among Banc of America Mortgage Securities, Inc., as depositor
(the "Depositor"), the Servicer, and Xxxxx Fargo Bank, N.A., as Trustee.
The Purchaser has requested the Servicer to engage the Loss Mitigation
Advisor, at the Purchaser's expense, to assist the Servicer with respect to
default management and reporting situations for the benefit of the Purchaser.
In consideration of the mutual agreements herein contained, the receipt
and sufficiency of which are hereby acknowledged, the Servicer hereby engages
the Loss Mitigation Advisor to provide advice in connection with default
management and reporting situations with respect to defaulted loans, including
providing to the Servicer recommendations with respect to foreclosures, the
acceptance of so-called short payoffs, deeds in lieu of or in aid of foreclosure
and deficiency notes, as well as with respect to the sale of REO properties. The
Loss Mitigation Advisor hereby accepts such engagement, and acknowledges that
its fees will be paid by the Purchaser and not the Servicer, and that it will
not look to the Servicer for financial remuneration. It is the intent of the
parties to this Agreement that the services of the Loss Mitigation Advisor are
provided without fee to the Servicer for the benefit of the Purchaser for the
life of the Class M Certificates.
ARTICLE I
DEFINITIONS
Section 1.01. Defined Terms.
Whenever used in this Agreement, the following words and phrases, unless
the context otherwise requires, shall have the following meanings:
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 are required or
authorized by law or executive order to be closed.
Commencement of Foreclosure: The first official action required under
local law in order 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.
Delay of Foreclosure: The postponement for more than three Business Days
of the scheduled sale of Mortgaged Property to obtain satisfaction of a Mortgage
Loan.
Loss Mitigation Advisor: ______________.
Purchaser: _______________________, or the holder of record of the Class M
Certificates.
Short Payoff: Liquidation of a Mortgage Loan at less than the full amount
of the outstanding balance of the Mortgage Loan plus advances and costs through
a negotiated settlement with the borrower, which may include a deed-in-lieu of
foreclosure or sale of the property or of the promissory note secured by the
collateral property to a third party, in either case with or without a
contribution toward any resulting deficiency by the borrower.
Section 1.02. Definitions Incorporated by Reference.
All capitalized terms not otherwise defined in this Agreement shall have
the meanings assigned in the Pooling and Servicing Agreements.
ARTICLE II
SPECIAL SERVICING PROCEDURES
Section 2.01. Reports and Notices.
(a) In connection with the performance of its duties under the
Pooling and Servicing Agreement relating to the realization upon defaulted
Mortgage Loans, the Servicer shall use reasonable efforts to provide to the
Loss Mitigation Advisor with the following notices and reports. All such
notices and reports may be sent to the Loss Mitigation Advisor by telecopier,
electronic mail, express mail or regular mail.
(i) The Servicer shall within five Business Days after each
Distribution Date either: (A) provide to the Loss Mitigation Advisor a
written or electronic report, using the same methodology and calculations
as in its standard servicing reports, indicating for the trust fund formed
by the Pooling and Servicing Agreement, the number of Mortgage Loans that
are (1) sixty days delinquent, (2) ninety days or more delinquent, (3) in
foreclosure or (4) real estate owned (REO), and indicating for each such
Mortgage Loan the loan number, whether the loan is in bankruptcy or paying
under the terms of a repayment plan, the reason for default, and
outstanding principal balance; or (B) provide the information detailed in
(A) to a data service provider of the Loss Mitigation Advisor's choice in
an electronic format acceptable to that data service provider. Provision
of the information to a service provider other than that specified by the
Loss Mitigation Advisor is acceptable.
(ii) Prior to a Delay of Foreclosure in connection with any Mortgage
Loan, the Servicer shall provide the Loss Mitigation Advisor with a notice
of such proposed and imminent delay, stating the loan number, the
aggregate amount owing under the Mortgage Loan, and the reason and
justification for delaying foreclosure action. All notices and supporting
documentation pursuant to this subsection may be provided via telecopier,
express mail or electronic mail.
(iii) Prior to accepting any Short Payoff in connection with any
Mortgage Loan, the Servicer shall provide the Loss Mitigation Advisor with
a notice of such proposed and imminent Short Payoff, stating the loan
number, the aggregate amount owing under the Mortgage Loan, and the
justification for accepting the proposed Short Payoff. Such notice may be
sent by telecopier, express mail, electronic mail or regular mail.
(iv) Within five (5) business days of each Distribution Date, the
Servicer shall provide the Loss Mitigation Advisor with a report listing
each loan that has resulted in a realized loss that has been reported to
the trustee. Such report shall specify the loan number, the outstanding
principal balance of the loan upon its liquidation, the realized loss, and
the following components of realized loss: foreclosure costs, advances,
mortgage insurance proceeds, marketing and property rehabilitation costs,
and other costs. Such report may be provided by telecopier, express mail,
regular mail or electronic mail. The Loss Mitigation Advisor shall have at
least ten (10) business days in which to respond with reasonable questions
or requests for additional information regarding the amounts reported as
realized losses, and the Servicer shall within five (5) business days of
receipt of the Loss Mitigation Advisor's questions or additional
information requests provide responses to such questions and requests.
(v) Within five (5) business days of receipt by the Servicer of an
offer to acquire an REO property at an amount that is more than 15% below
the most recent market valuation of that property obtained by the Servicer
(or if no such valuation has been obtained, the appraisal used in
connection with the originating of the related Mortgage Loan), the
Servicer shall notify the Loss Mitigation Advisor of such offer and shall
provide a justification for accepting such offer, if that is the
Servicer's recommendation.
(vi) Within five (5) business days of receipt by the Servicer that a
claim filed for mortgage insurance, or any part thereof, has been rejected
by the mortgage insurance provider, the Servicer shall provide a copy of
the rejected claim with explanations for the item or items rejected to the
Loss Mitigation Advisor.
(vii) Within five (5) business days of providing the trustee with
any notice regarding a mortgage loan substitution, loan modification, or
loan repurchase, the Servicer shall provide the Loss Mitigation Advisor
with a copy of the notice.
(b) If requested by the Loss Mitigation Advisor, the Servicer shall
make its servicing personnel available during its normal business hours to
respond to reasonable inquiries, in writing by facsimile transmission,
express mail or electronic mail, by the Loss Mitigation Advisor in connection
with any Mortgage Loan identified in a report under subsection 2.01 (a)(i),
(a)(ii), (a)(iii) or (a)(iv) which has been given to the Loss Mitigation
Advisor; provided that the Servicer shall only be required to provide
information that is readily accessible to their servicing personnel.
(c) In addition to the foregoing, the Servicer shall provide to the
Loss Mitigation Advisor such information as the Loss Mitigation Advisor may
reasonably request concerning each Mortgage Loan that is at least sixty days
delinquent and each Mortgage Loan which has become real estate owned,
provided that the Servicer shall only be required to provide information that
is readily accessible to its servicing personnel.
(d) With respect to all Mortgage Loans which are serviced at any
time by the Servicer through a subservicer, the Servicer shall be entitled to
rely for all purposes hereunder, including for purposes of fulfilling its
reporting obligations under this Section 2.01, on the accuracy and
completeness of any information provided to it by the applicable subservicer.
Section 2.02. Loss Mitigation Advisor's Recommendations
With Respect to Defaulted Loans.
(a) All parties to this Agreement acknowledge that the Loss
Mitigation Advisor's advice is made in the form of recommendations, and that
the Loss Mitigation Advisor does not have the right to direct the Servicer in
performing its duties under the Pooling and Servicing Agreement. The Servicer
may, after review and analysis of the Loss Mitigation Advisor's
recommendation, accept or reject it, in the Servicer's sole discretion,
subject to the standards of the Servicer to protect the interest of the
Certificateholders set forth in the Pooling and Servicing Agreement.
(b) Within two (2) business days of receipt of a notice of a
foreclosure delay, the Loss Mitigation Advisor shall provide the Servicer
with a recommendation regarding the delay, provided, however, that if
additional information is required on which to base a recommendation, the
Loss Mitigation Advisor shall notify the Servicer of the additional
information needed within the allotted time, and the Servicer shall promptly
provide such information and the Loss Mitigation Advisor shall then submit to
the Servicer its recommendation. The Loss Mitigation Advisor may recommend
that additional procedures be undertaken to further analyze the property, the
borrower, or issues related to the default or foreclosure. Such additional
procedures may include asset searches, property valuations, legal analysis or
other procedures that are warranted by the circumstances of the property,
borrower or foreclosure. The Loss Mitigation Advisor may recommend such other
actions as are warranted by the circumstances of the property, borrower or
foreclosure.
(c) Within two (2) business days of receipt of a notice of a
proposed Short Payoff, the Loss Mitigation Advisor shall provide the Servicer
with a recommendation regarding the proposed Short Payoff, provided, however,
that if additional information is required on which to base a recommendation,
the Loss Mitigation Advisor shall notify the Servicer of the additional
information needed within two business days, and the Servicer shall promptly
provide such information and the Loss Mitigation Advisor shall then submit to
the Servicer its recommendation. The Loss Mitigation Advisor's recommendation
may take the form of concurring with the proposed Short Payoff, recommending
against such Short Payoff, with a justification provided, or proposing a
counteroffer.
(d) Within two (2) business days of receipt of a notice of an REO
sale at an amount that is more than 15% below the recent market valuation of
that property, the Loss Mitigation Advisor shall provide the Servicer with
its recommendation. The Loss Mitigation Advisor's recommendation may take the
form of concurring with the proposed below-market sale, recommending against
such below-market sale, or proposing a counteroffer.
Section 2.03. Termination.
(a) With respect to all Mortgage Loans included in a trust fund, the
Servicer's obligations under Section 2.01 and Section 2.02 shall terminate at
such time as the Certificate Principal Balances of the related Class M
Certificates have been reduced to zero.
(b) The Loss Mitigation Advisor's responsibilities under this
Agreement shall terminate upon the termination of the fee agreement between
the Purchaser or its successor and the Loss Mitigation Advisor. The Loss
Mitigation Advisor shall promptly notify the Servicer of the date of
termination of such fee agreement, but in no event later than 5:00 P.M., EST,
on the effective date thereof.
(c) Neither the Servicer nor any of its directors, officers,
employees or agents shall be under any liability 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 Servicer or any such Person against any liability which
would otherwise be imposed by reason 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 Servicer and the Loss
Mitigation Advisor and any director, officer, employee or agent thereof 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. Neither
the Loss Mitigation Advisor, its directors, officers, employees or agents
shall be under any liability for any actions taken by the Servicer based upon
the recommendation pursuant to this Agreement, provided they are made in good
faith.
ARTICLE III
MISCELLANEOUS PROVISIONS
Section 3.01. Amendment.
This Agreement may be amended from time to time by the Servicer and
the Loss Mitigation Advisor by written agreement signed by the Servicer and the
Loss Mitigation Advisor.
Section 3.02. Counterparts.
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 3.03. Governing Law.
This Agreement shall be construed in accordance with the laws of the
State of New York and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws.
Section 3.04. Notices.
All demands, notices and direction hereunder shall be in writing or
by telecopier and shall be deemed effective upon receipt to:
(a) in the case of the Servicer,
Bank of America, National Association
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: Secondary Marketing with a copy to the General Counsel
or such other address as may hereafter be furnished in writing by the Servicer,
(b) in the case of the Loss Mitigation Advisor,
_______________________
(c) in the case of the Purchaser:
_______________________
Section 3.05. Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms
of this Agreement shall be for any reason whatsoever, including regulatory, 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.
Section 3.06. Successors and Assigns.
(a) The provisions of this Agreement shall be binding upon and inure
to the benefit of the respective successors and assigns of the parties hereto,
and all such provisions shall inure to the benefit of the Certificateholders.
(b) The Servicer shall notify the Loss Mitigation Advisor of the
assignment of its duties to any successor servicer within thirty (30) days prior
to such assignment, and shall provide the name, address, telephone number and
telecopier number for the successor to the Loss Mitigation Advisor.
Section 3.07. Article and Section Headings.
The article and section headings herein are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
Section 3.08. Confidentiality.
The Servicer acknowledges the confidentiality of this Agreement and
will not release or republish its contents without the consent of the Loss
Mitigation Advisor except to the extent required by law, regulation or court
order.
The Loss Mitigation Advisor agrees that all information supplied by
or on behalf of the Servicer under this Agreement, is the property of the
Servicer. The Loss Mitigation Advisor shall keep in strictest confidence all
information relating to this Agreement, including, without limitation,
individual account information and other information supplied by or on behalf of
the Servicer pursuant to Section 2.01, and that information which may be
acquired in connection with or as a result of this Agreement. During the term of
this Agreement and at any time thereafter, without the prior written consent of
the Servicer, the Loss Mitigation Advisor shall not publish, communicate,
divulge, disclose or use any of such information. Upon termination or expiration
of this Agreement, the Loss Mitigation Advisor shall deliver all records, data,
information, and other documents and all copies thereof supplied by or on behalf
of the Servicer pursuant to Section 2.01 to the Servicer and such shall remain
the property of the Servicer.
Section 3.09. Independent Contractor.
In all matters relating to this Agreement, the Loss Mitigation
Advisor shall be acting as an independent contractor. Neither the Loss
Mitigation Advisor nor any employees of the Loss Mitigation Advisor are
employees or agents of the Servicer under the meaning or application of any
Federal or State Unemployment or Insurance Laws or Workmen's Compensation Laws,
or otherwise. The Loss Mitigation Advisor shall assume all liabilities or
obligations imposed by any one or more of such laws with respect to the
employees of the Loss Mitigation Advisor in the performance of this Agreement.
The Loss Mitigation Advisor shall not have any authority to assume or create any
obligation, express or implied, on behalf of the Servicer, and the Loss
Mitigation Advisor shall not have the authority to represent itself as an agent,
employee, or in any other capacity of the Servicer.
IN WITNESS WHEREOF, the Servicer and the Loss Mitigation Advisor
have caused their names to be signed hereto by their respective officers
thereunto duly authorized, all as of the day and year first above written.
Bank of America, National Association
By:_________________________________
Name:______________________________
Title:________________________________
Loss Mitigation Advisor
___________________
By:_________________________________
Name:
Title:
PURCHASER'S ACKNOWLEDGEMENT AND AGREEMENT
Purchaser executes this agreement for the purpose of acknowledging the limited
obligations of the Servicer in respect of the Loss Mitigation Advisor's
recommendation, as described in Section 2.02(a) hereof and confirming to the
Servicer that (i) it shall be solely responsible for the payment of the fees of
the Loss Mitigation Advisor pursuant to the terms of an agreement between
Purchaser and Loss Mitigation Advisor dated _____________, 20__ and (ii)
Purchaser upon transfer of its interest in any of the Class M Certificates or
any part thereof will require its successor to consent to this Special Servicing
Agreement and to pay any of the fees due to the Loss Mitigation Advisor pursuant
to the agreement referenced in clause (i) above.
Purchaser
By:________________________________
Name:______________________________
Title:_______________________________
EXHIBIT L
LIST OF RECORDATION STATES
Florida
Maryland
EXHIBIT M
FORM OF INITIAL CERTIFICATION OF THE TRUSTEE
September 28, 0000
Xxxx xx Xxxxxxx Mortgage Securities, Inc.
Secondary Marketing
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
NC1-027-14-01
Attn: Xxxxxx Xxxxxxx
Bank of America, National Association
Secondary Marketing
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
NC1-027-14-01
Attn: Xxxxxx Xxxxxxx
Xxxxx Fargo Bank, N.A.
0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Attn: BOAALT 2006-7
Re: Banc of America Mortgage Securities, Inc. Banc of America
Alternative Loan Trust 2006-7 Mortgage Pass-Through Certificates,
Series 2006-7, issued pursuant to a Pooling and Servicing Agreement,
dated September 28, 2006, among Banc of America Mortgage Securities,
Inc., as Depositor, Bank of America, National Association, as
Servicer, and Xxxxx Fargo Bank, N.A., as Trustee
Ladies and Gentlemen:
In accordance with the provisions of Section 2.02 of the above-referenced
Pooling and Servicing Agreement (the "Pooling and Servicing Agreement"), the
undersigned, as Trustee, hereby certifies that, except as specified in any list
of exceptions attached hereto, either (i) it has received the original Mortgage
Note relating to each of the Mortgage Loans listed on the Mortgage Loan Schedule
or (ii) if such original Mortgage Note has been lost, a copy of such original
Mortgage Note, together with a lost note affidavit.
The Trustee has made no independent examination of any documents contained
in each Mortgage File beyond the review specifically required in the Pooling and
Servicing Agreement in connection with this Initial Certification. The Trustee
makes no representations as to: (i) the validity, legality, sufficiency,
enforceability, recordability or genuineness of any of the documents contained
in each Mortgage File or any of the Mortgage Loans identified in the Mortgage
Loan Schedule or (ii) the collectibility, insurability, effectiveness or
suitability of any such Mortgage Loan.
Capitalized terms used but not defined herein shall have the meanings
ascribed to such terms in the Pooling and Servicing Agreement.
XXXXX FARGO BANK, N.A.,
as Trustee
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
EXHIBIT N
FORM OF FINAL CERTIFICATION OF THE TRUSTEE
[__________ __, ____]
Banc of America Mortgage Securities, Inc.
Secondary Marketing
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
NC1-027-14-01
Attn: Xxxxxx Xxxxxxx
Bank of America, National Association
Secondary Marketing
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
NC1-027-14-01
Attn: Xxxxxx Xxxxxxx
Xxxxx Fargo Bank, N.A.
0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Attn: BOAALT 2006-7
Re: Banc of America Mortgage Securities, Inc. Banc of America
Alternative Loan Trust 2006-7 Mortgage Pass-Through Certificates,
Series 2006-7, issued pursuant to a Pooling and Servicing Agreement,
dated September 28, 2006, among Banc of America Mortgage Securities,
Inc., as Depositor, Bank of America, National Association, as
Servicer, and Xxxxx Fargo Bank, N.A., as Trustee
Ladies and Gentlemen:
In accordance with the provisions of Section 2.02 of the above-referenced
Pooling and Servicing Agreement (the "Pooling and Servicing Agreement"), the
undersigned, as Trustee, hereby certifies that, as to each Mortgage Loan listed
in the Mortgage Loan Schedule, except as may be specified in any list of
exceptions attached hereto, such Mortgage File contains all of the items
required to be delivered pursuant to Section 2.01(b) of the Pooling and
Servicing Agreement.
The Trustee has made no independent examination of any documents contained
in each Mortgage File beyond the review specifically required in the Pooling and
Servicing Agreement in connection with this Final Certification. The Trustee
makes no representations as to: (i) the validity, legality, sufficiency,
enforceability, recordability or genuineness of any of the documents contained
in each Mortgage File or any of the Mortgage Loans identified in the Mortgage
Loan Schedule or (ii) the collectibility, insurability, effectiveness or
suitability of any such Mortgage Loan.
Capitalized terms used but not defined herein shall have the meanings
ascribed to such terms in the Pooling and Servicing Agreement.
XXXXX FARGO BANK, N.A.,
as Trustee
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
EXHIBIT O
Form of Xxxxxxxx-Xxxxx Certification
Banc of America Alternative Loan Trust 2006-7
Mortgage Pass-Through Certificates,
Series 2006-7
I, [________], a [_____________] of Bank of America, National Association
(the "Servicer"), certify that:
1. I have reviewed this report on Form 10-K and all reports on Form 10-D
required to be filed in respect of the period covered by this report on
Form 10-K of the Banc of America Alternative Loan Trust 0000-0 (xxx
"Xxxxxxxx Xxx Periodic Reports");
2. Based on my knowledge, the Exchange Act Periodic Reports, taken as a
whole, do not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements made, in light of
the circumstances under which such statements were made, not misleading
with respect to the period covered by this report;
3. Based on my knowledge, all of the distribution, servicing and other
information required to be provided under Form 10-D for the period covered
by this report is included in the Exchange Act Periodic Reports;
4. I am responsible for reviewing the activities performed by the Servicer
and based upon my knowledge and the compliance review conducted in
preparing the servicer compliance statement required in this report under
Item 1123 of Regulation AB, and except as disclosed in the Exchange Act
Periodic Reports, the Servicer has fulfilled its obligations under the
pooling and servicing agreement, dated September 28, 2006, among Banc of
America Mortgage Securities, Inc., as depositor, Xxxxx Fargo Bank, N.A.,
as trustee, and the Servicer; and
5. All of the reports on assessment of compliance with the servicing criteria
for asset-backed securities and their related attestation reports on
assessment of compliance with servicing criteria for asset-backed
securities required to be included in this report in accordance with Item
1122 of Regulation AB and Exchange Act Rules 13a-18 and 15d-18 have been
included as an exhibit to this report, except as otherwise disclosed in
this report. Any material instances of noncompliance described in such
reports have been disclosed in this report on Form 10-K.
In giving the certifications above, I have reasonably relied on
information provided to me by the following unaffiliated party: Xxxxx Fargo
Bank, N.A.
[_________], 20
By:
---------------------------------------
Name:
Title:
EXHIBIT P
Form of Certification to be Provided by the Trustee to the Servicer
Banc of America Alternative Loan Trust 2006-7
Mortgage Pass-Through Certificates,
Series 2006-7
Re: Banc of America Alternative Loan Trust 2006-7 (the "Trust"),
Mortgage Pass-Through Certificates, Series 2006-7, issued pursuant
to a Pooling and Servicing Agreement dated September 28, 2006 (the
"Pooling Agreement"), among Banc of America Mortgage Securities,
Inc., as Depositor, Bank of America, National Association, as
Servicer, and Xxxxx Fargo Bank, N.A., as Trustee
The Trustee hereby certifies to the Servicer and its officers,
directors and affiliates, and with the knowledge and intent that they will rely
upon this certification, that:
1. I have reviewed the annual report on Form 10 K for the fiscal
year [___] (the "Annual Report"), and all reports on Form 10 D required to be
filed in respect of period covered by the Annual Report (collectively with the
Annual Report, the "Reports"), of the Trust;
2. To my knowledge, the Reports, taken as a whole, do not contain
any untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the period covered by
the Annual Report;
3. To my knowledge, the distribution information required to be
provided by the Trustee under the Pooling Agreement for inclusion in the Reports
is included in the Reports;
4. I am responsible for reviewing the activities performed by the
Trustee under the Pooling and Servicing Agreement, and based on my knowledge and
the compliance review conducted in preparing the compliance statement of the
Trustee required in the Annual Report under Item 1123 of Regulation AB, and
except as disclosed in the Reports, the Trustee has fulfilled its obligations
under the Pooling Agreement in all material respects; and
5. The report on assessment of compliance with servicing criteria
for asset-backed securities of the Trustee and its related attestation report on
assessment of compliance with servicing criteria required to be included in the
Annual Report in accordance with Item 1122 of Regulation AB and Exchange Act
Rules 13a-18 and 15d-18 has been included as an exhibit to the Annual Report.
Any material instances of non-compliance are described in such report and have
been disclosed in the Annual Report.
XXXXX FARGO BANK, N.A.
as Trustee
By:
---------------------------------------
Name:
Title:
EXHIBIT Q
Servicing Criteria to be Addressed in Assessment of Compliance
APPLICABLE SERVICING
SERVICING CRITERIA CRITERIA
---------------------------------------------------------------------------------------------------------------
Reference Criteria Servicer Trustee
---------------------------------------------------------------------------------------------------------------
General Servicing Considerations
---------------------------------------------------------------------------------------------------------------
Policies and procedures are instituted to monitor any performance
or other triggers and events of default in accordance with the
1122(d)(1)(i) transaction agreements. X X
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 X X
1122(d)(1)(ii) activities.
Any requirements in the transaction agreements to maintain a
1122(d)(1)(iii) back-up servicer for the mortgage loans are maintained.
A fidelity bond and errors and omissions policy is in
effect on the party participating in the servicing function
throughout the reporting period in the amount of coverage
required by and otherwise in accordance with the terms of
1122(d)(1)(iv) the transaction agreements. X
---------------------------------------------------------------------------------------------------------------
Cash Collection and Administration
---------------------------------------------------------------------------------------------------------------
Payments on mortgage loans are deposited into the
appropriate custodial bank accounts and related bank
clearing accounts no more than two business days following
receipt, or such other number of days specified in the
1122(d)(2)(i) transaction agreements. X X
Disbursements made via wire transfer on behalf of an obligor or to
1122(d)(2)(ii) an investor are made only by authorized personnel. X X
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
1122(d)(2)(iii) as specified in the transaction agreements. X
The related accounts for the transaction, such as cash
reserve accounts or accounts established as a form of
overcollateralization, are separately maintained (e.g., with X X
respect to commingling of cash) as set forth in the transaction
1122(d)(2)(iv) agreements.
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 X X
1122(d)(2)(v) 13k-1(b)(1) of the Securities Exchange Act.
Unissued checks are safeguarded so as to prevent unauthorized
1122(d)(2)(vi) access. X X
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 X X
their original identification, or such other number of days
1122(d)(2)(vii) specified in the transaction agreements.
---------------------------------------------------------------------------------------------------------------
Investor Remittances and Reporting
---------------------------------------------------------------------------------------------------------------
Reports to investors, including those to be filed with the
Commission, are maintained in accordance with the
transaction agreements and applicable Commission
requirements. Specifically, such reports (A) are prepared
in accordance with timeframes and other terms set forth in
the transaction agreements; (B) provide information
calculated in accordance with the terms specified in the
transaction agreements; (C) are filed with the Commission
as required by its rules and regulations; and (D) agree
with investors' or the trustee's records as to the total unpaid
principal balance and number of mortgage loans serviced by the
1122(d)(3)(i) Servicer. X
Amounts due to investors are allocated and remitted in
accordance with timeframes, distribution priority and other
terms set forth in
1122(d)(3)(ii) the transaction agreements. X
Disbursements made to an investor are posted within two business
days to the Servicer's investor records, or such other number of X
1122(d)(3)(iii) days specified in the transaction agreements.
Amounts remitted to investors per the investor reports agree with
cancelled checks, or other form of payment, or custodial bank X
1122(d)(3)(iv) statements.
---------------------------------------------------------------------------------------------------------------
Pool Asset Administration
---------------------------------------------------------------------------------------------------------------
Collateral or security on mortgage loans is maintained as required
1122(d)(4)(i) by the transaction agreements or related mortgage loan documents. X X
Mortgage loan and related documents are safeguarded as required by X X
1122(d)(4)(ii) the transaction agreements
Any additions, removals or substitutions to the asset pool
are made, reviewed and approved in accordance with any
1122(d)(4)(iii) conditions or requirements in the transaction agreements. X
Payments on mortgage loans, including any payoffs, made in
accordance with the related mortgage loan documents are
posted to the Servicer's obligor records maintained no more
than two business days after receipt, or such other number
of days specified in the transaction agreements, and
allocated to principal, interest or other items (e.g.,
escrow) in accordance with the related mortgage X
1122(d)(4)(iv) loan documents.
The Servicer's records regarding the mortgage loans agree
with the Servicer's records with respect to an obligor's
unpaid principal
1122(d)(4)(v) balance. X
Changes with respect to the terms or status of an obligor's
mortgage loans (e.g., loan modifications or re-agings) are made,
reviewed and approved by authorized personnel in accordance with X
1122(d)(4)(vi) the transaction agreements and related pool asset documents.
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
1122(d)(4)(vii) timeframes or other requirements established by the X
transaction agreements.
Records documenting collection efforts are maintained
during the period a mortgage loan is delinquent in
accordance with the transaction agreements. Such records
are maintained on at least a monthly basis, or such other
period specified in the transaction agreements, and
describe the entity's activities in monitoring delinquent
mortgage loans including, for example, phone calls,
letters and payment rescheduling plans in cases where
1122(d)(4)(viii) delinquency is deemed temporary (e.g., illness or unemployment). X
Adjustments to interest rates or rates of return for
mortgage loans with variable rates are computed based on
1122(d)(4)(ix) the related mortgage loan documents. 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 mortgage loan documents, on at least an annual basis, or
such other period specified in the transaction agreements; (B)
interest on such funds is paid, or credited, to obligors in
accordance with applicable mortgage loan documents and state laws;
and (C) such funds are returned to the obligor within 30 calendar
days of full repayment of the related mortgage loans, or such other
1122(d)(4)(x) number of days specified in the transaction agreements. X
Payments made on behalf of an obligor (such as tax or
insurance payments) are made on or before the related
penalty or expiration dates, as indicated on the
appropriate bills or notices for such payments, provided
that such support has been received by the servicer at
least 30 calendar days prior to these dates, or such
1122(d)(4)(xi) other number of days specified in the transaction agreements. X
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
1122(d)(4)(xii) late payment was due to the obligor's error or omission. X
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
1122(d)(4)(xiii) specified in the transaction agreements. X
Delinquencies, charge-offs and uncollectible accounts are
recognized and recorded in accordance with the transaction
1122(d)(4)(xiv) agreements. X X
Any external enhancement or other support, identified in Item
1114(a)(1) through (3) or Item 1115 of Regulation AB, is maintained X X
1122(d)(4)(xv) as set forth in the transaction agreements.
[BANK OF AMERICA, NATIONAL ASSOCIATION] [XXXXX FARGO BANK, N.A.]
Date: _________________________
By:
Name: ________________________________
Title: ________________________________
EXHIBIT R-1
ADDITIONAL FORM 10-D INFORMATION
--------------------------------------------------------------------------------
Item on Form 10-D Party Responsible
--------------------------------------------------------------------------------
Item 1: Distribution and Pool Depositor
Performance Information Servicer
Trustee
Any information required by Item
1121 of Regulation AB which is
not included on the Distribution
Date Statement
--------------------------------------------------------------------------------
Item 2: Legal Proceedings (i) All parties to the Agreement (as
to themselves), (ii) the Trustee and
Servicer as to the Trust and (iii) the
per Item 1117 of Regulation AB Depositor as to the Sponsor or any
Regulation AB Item 1100(d)(1) party
--------------------------------------------------------------------------------
Item 3: Sale of Securities and Use Depositor
of Proceeds
--------------------------------------------------------------------------------
Item 4: Defaults Upon Senior Trustee
Securities
--------------------------------------------------------------------------------
Item 5: Submission of Matters to a Trustee
Vote of Security Holders
--------------------------------------------------------------------------------
Item 6: Significant Obligors of N/A
Pool Assets
--------------------------------------------------------------------------------
Item 7: Significant Enhancement Depositor
Provider Information Trustee
--------------------------------------------------------------------------------
Item 8: Other Information Any party to the Agreement responsible
for disclosure items on Form 8-K
--------------------------------------------------------------------------------
Item 9: Exhibits Depositor
Trustee
--------------------------------------------------------------------------------
EXHIBIT R-2
ADDITIONAL FORM 10-K INFORMATION
--------------------------------------------------------------------------------
Item on Form 10-K Party Responsible
--------------------------------------------------------------------------------
Item 9B: Other Information Any party to the Agreement responsible
for disclosure items on Form 8-K
--------------------------------------------------------------------------------
Item 15: Exhibits, Financial Trustee
Statement Schedules Depositor
--------------------------------------------------------------------------------
Additional Item: (i) All parties to the Agreement (as to
themselves), (ii) the Trustee and
Servicer as to the Trust, (iii) the
Depositor as to the Sponsor or any
Regulation AB Item 1100(d)(1) party
Disclosure per Item 1117 of
Regulation AB
--------------------------------------------------------------------------------
Additional Item: (i) All parties to the Agreement as to
themselves and (ii) the Depositor as to
the Sponsor
Disclosure per Item 1119 of
Regulation AB
--------------------------------------------------------------------------------
Additional Item: N/A
Disclosure per Item 1112(b) of
Regulation AB
--------------------------------------------------------------------------------
Additional Item: Depositor
Disclosure per Items 1114(b) and Trustee
1115(b) of Regulation AB
--------------------------------------------------------------------------------
EXHIBIT R-3
FORM 8-K INFORMATION
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Item on Form 8-K Party Responsible
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Item 1.01- Entry into a Material The party to this Agreement entering into
Definitive Agreement such material definitive agreement
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Item 1.02- Termination of a The party to this Agreement requesting
Material Definitive Agreement termination of a material definitive
agreement
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Item 1.03- Bankruptcy or Depositor
Receivership
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Item 2.04- Triggering Events Servicer
that Accelerate or Increase a Trustee
Direct Financial Obligation or
an Obligation under an
Off-Balance Sheet Arrangement
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Item 3.03- Material Modification Trustee
to Rights of Security Holders
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Item 5.03- Amendments of Depositor
Articles of Incorporation or Servicer
Bylaws; Change of Fiscal Year Trustee
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Item 6.01- ABS Informational and Depositor
Computational Material
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Item 6.02- Change of Servicer or Servicer
Trustee Trustee
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Item 6.03- Change in Credit Depositor
Enhancement or External Support Trustee
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Item 6.04- Failure to Make a Trustee
Required Distribution
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Item 6.05- Securities Act Depositor
Updating Disclosure
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Item 7.01- Regulation FD Depositor
Disclosure
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Item 8.01 Depositor
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Item 9.01 Depositor
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