AMERICAN HOME MORTGAGE INVESTMENT TRUST 2005-3 ISSUER WELLS FARGO BANK, N.A. SECURITIES ADMINISTRATOR AND DEUTSCHE BANK NATIONAL TRUST COMPANY INDENTURE TRUSTEE INDENTURE DATED AS OF SEPTEMBER 20, 2005 MORTGAGE-BACKED NOTES

APPENDIX A

DEFINITIONS

Accepted Master Servicing Practices: With respect to any Mortgage Loan, those customary mortgage master servicing practices of prudent mortgage servicing institutions that master service mortgage loans of the same type and quality as such Mortgage Loan in the jurisdiction where the related Mortgaged Property is located, to the extent applicable to the Indenture Trustee or the Master Servicer (except in its capacity as successor to the Servicer).

Accrual Period: With respect to any Payment Date and the Notes, other than Class II-A-2, Class II-A-3, Class II-A-4, Class III-A-1, Class III-A-3, Class III-A-4, Class M-5 and Class M-6 Notes, the period from the preceding Payment Date (or in the case of the first Payment Date, from the Closing Date) through the day preceding such Payment Date. With respect to any Payment Date and the Class II-A-2, Class II-A-3, Class II-A-4, Class III-A-1, Class III-A-3, Class III-A-4, Class M-5 and Class M-6 Notes, the prior calendar month. Accrued Note Interest for the Class I-A, Class II-A-1, Class III-A-2, Class M-1, Class M-2, Class M-3 and Class M-4 Notes shall be calculated on the basis of the actual number of days in the Accrual Period and a 360-day year. Accrued Note Interest on the Class II-A-2, Class II-A-3, Class II-A-4, Class III-A-1, Class III-A-3, Class III-A-4, Class M-5 and Class M-6 Notes shall be calculated on the basis of a 360-day year consisting of twelve 30-day months.

Accrued Note Interest: With respect to any Payment Date and each Class of Notes, interest accrued during the related Accrual Period at the then-applicable Note Interest Rate on the related Note Principal Balance thereof immediately prior to such Payment Date, plus any Accrued Note Interest remaining unpaid from any prior Payment Date with interest thereon at the related Note Interest Rate.

Adjustment Fraction: For any Payment Date with respect to the Class A Notes and Class M Notes, a fraction, (x) the numerator of which is the aggregate Stated Principal Balance of the Mortgage Loans at the beginning of the related Due Period, and (y) the denominator of which is the aggregate Note Principal Balance of the Class A, Class M and Class B Notes immediately prior to that Payment Date.

Adjustment Date: As to each Mortgage Loan, each date set forth in the related Mortgage Note on which an adjustment to the interest rate on such Mortgage Loan becomes effective.

Affiliate: With respect to any Person, any other Person controlling, controlled by or under common control with such Person. For purposes of this definition, “control” means the power to direct the management and policies of a Person, directly or indirectly, whether through ownership of voting securities, by contract or otherwise and “controlling” and “controlled” shall have meanings correlative to the foregoing.

Allocated Realized Loss Amount: With respect to any Class I-A-2, Class M and Class B Notes and any Payment Date, an amount equal to the sum of any Realized Loss allocated to that Class of Notes on that Payment Date and any Allocated Realized Loss Amount for that Class remaining unpaid from the previous Payment Dates, in each case, with interest thereon at the

 

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applicable Note Interest Rate for such Payment Date for such Class for the related Accrual Period.

Appraised Value: The appraised value of a Mortgaged Property based upon the appraisal made by or for the Seller, in compliance with the Seller’s underwriting criteria, of such Mortgaged Property at such time of origination. With respect to a Mortgage Loan, the proceeds of which were used to refinance an existing Mortgage Loan, the appraised value of the Mortgaged Property based upon the appraisal obtained at the time of refinancing.

ARM Loans: At any time, collectively, all the Mortgage Loans which have adjustable Mortgage Rates.

Assignment of Mortgage: An assignment of Mortgage, notice of transfer or equivalent instrument, in recordable form, which is sufficient under the laws of the jurisdiction wherein the related Mortgaged Property is located to reflect of record the sale of the Mortgage, which assignment, notice of transfer or equivalent instrument may be in the form of one or more blanket assignments covering Mortgages secured by Mortgaged Properties located in the same county, if permitted by law.

Authorized Newspaper: A newspaper of general circulation in the Borough of Manhattan, The City of New York, printed in the English language and customarily published on each Business Day, whether or not published on Saturdays, Sundays or holidays.

Authorized Officer: With respect to the Issuer, any officer of the Owner Trustee who is authorized to act for the Owner Trustee in matters relating to the Issuer and who is identified on the list of Authorized Officers delivered by the Owner Trustee to the Indenture Trustee on the Closing Date (as such list may be modified or supplemented from time to time thereafter).

Available Funds: The Group I, Group II or Group III Available Funds, as applicable.

Available Funds Rate: On any Payment Date and any Class I-A, Class II-A and Class III-A Notes, the per annum rate equal to (a) the weighted average (as described below) of the Net Mortgage Rates on the related Mortgage Loans included in the trust as of the end of the prior Due Period, weighted on the basis of the Stated Principal Balances thereof as of the end of the prior Due Period, times (b) in the case of the Class I-A, Class III-A-1, Class II-A-2 Notes, a fraction equal to (x) 30 divided by (y) the number of days in the related Accrual Period and times (c) the related Adjustment Fraction.

On any Payment Date and any Class of Class M Notes, the per annum rate equal to (a) the weighted average (as described below) of the Net Mortgage Rates of the Mortgage Loans included in the trust as of the end of the prior Due Period, weighted on the basis of the Stated Principal Balances thereof as of the end of the prior Due Period, weighted in proportion to the results of subtracting from the aggregate Stated Principal Balance of the Mortgage Loans, the aggregate Note Principal Balance of the related Class I-A, Class II-A and Class III-A Notes, times (b) in the case of the Class M-1, Class M-2, Class M-3 and Class M-4 Notes, a fraction

 

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equal to (x) 30 divided by (y) the number of days in the related Accrual Period and times (c) the related Adjustment Fraction.

Bankruptcy Code: The Bankruptcy Code of 1978, as amended.

Basic Documents: The Trust Agreement, the Certificate of Trust, the Indenture, the Notes, the Trust Certificates, the Master Servicing Agreement, the Servicing Agreement, the Mortgage Loan Purchase Agreement, the Corridor Contracts and the other documents and certificates delivered in connection with any of the above.

Basic Principal Distribution Amount: With respect to any Payment Date, the lesser of (a) the excess of (i) the sum of the Group I, Group II and Group III Available Funds for such Payment Date over (ii) the aggregate amount of Accrued Note Interest for the Class A Notes and Class M Notes for such Payment Date and (b) the Principal Remittance Amount for the Mortgage Loans for such Payment Date.

Basis Risk Amount: With respect to each Derivative Contract and each Payment Date, an amount equal to the sum of (x) the Basis Risk Shortfall Carry-Forward Amount for the related Class of Notes for such Payment Date and (y) the product of (i) the Other Basis Risk Amount for such Payment Date and (ii) a fraction, the numerator of which is the Excess Basis Risk Capacity with respect to such Derivative Contract for such Payment Date and the denominator of which is the aggregate Excess Basis Risk Capacity with respect to all Derivative Contracts for such Payment Date.

Basis Risk Shortfall: With respect to any class of LIBOR Notes, on each Payment Date where clause (iii) of the definition of “Note Interest Rate” is less than clauses (i) or (ii) of the definition of “Note Interest Rate,” the excess, if any, of (x) the aggregate Accrued Note Interest thereon for such Payment Date calculated pursuant to the lesser of clause (i) or (ii) of the definition of Note Interest Rate over (y) Accrued Note Interest thereon for such Payment Date calculated at the related Available Funds Rate.

Basis Risk Shortfall Carry-Forward Amount: With respect to each class of LIBOR Notes and any Payment Date, as determined separately for each such Class of Notes, an amount equal to the aggregate amount of Basis Risk Shortfall for such Notes on such Payment Date, plus any unpaid Basis Risk Shortfall for such Class of Notes from prior Payment Dates, plus interest thereon at the Note Interest Rate, to the extent previously unreimbursed by the Net Monthly Excess Cashflow or payments received by the Indenture Trustee under the related Corridor Contract.

Beneficial Owner: With respect to any Book-Entry Note, the Person who is the beneficial owner of such Note as reflected on the books of the Depository or on the books of a Person maintaining an account with such Depository (directly as a Depository Participant or indirectly through a Depository Participant, in accordance with the rules of such Depository).

 

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Book-Entry Notes: Beneficial interests in the Offered Notes, ownership and transfers of which shall be made through book entries by the Depository as described in Section 4.06 of the Indenture.

Business Day: Any day other than (i) a Saturday or a Sunday or (ii) a day on which banking institutions in the States of Maryland, Minnesota, New York, Delaware or Maryland or in the city in which a Corporate Trust Office is located, is required or authorized by law to be closed.

Calendar Quarter: A calendar quarter shall consist of one of the following time periods in any given year: January 1 through March 31, April 1 through June 30, July 1 though September 30, and October 1 through December 31.

Cash Liquidation: As to any defaulted Mortgage Loan other than a Mortgage Loan as to which an REO Acquisition occurred, a determination by the Servicer evidenced in a certificate of a Servicing Officer that it has received all Insurance Proceeds, Liquidation Proceeds and other payments or cash recoveries which the Servicer reasonably and in good faith expects to be finally recoverable with respect to such Mortgage Loan.

Ceiling Rate: With respect to each Corridor Contract and each Payment Date, the fixed rate set forth in the related Corridor Contract used to determine payments to the Indenture Trustee.

Certificate Distribution Account: The account or accounts created and maintained pursuant to Section 3.10(c) of the Trust Agreement. The Certificate Distribution Account shall be an Eligible Account.

Certificate Paying Agent: Initially, Deutsche Bank National Trust Company, in its capacity as Certificate Paying Agent, or any successor to Deutsche Bank National Trust Company in such capacity.

Certificate Percentage Interest: With respect to each Certificate, the Certificate Percentage Interest stated on the face thereof.

Certificate Register: The register maintained by the Certificate Registrar in which the Certificate Registrar shall provide for the registration of Certificates and of transfers and exchanges of Certificates.

Certificate Registrar: Initially, Deutsche Bank National Trust Company, in its capacity as Certificate Registrar, or any successor to Deutsche Bank National Trust Company in such capacity.

Certificate of Trust: The Certificate of Trust filed for the Trust pursuant to Section 3810(a) of the Statutory Trust Statute.

Certificates or Trust Certificates: The American Home Mortgage Investment Trust 2005-3 Trust Certificates, Series 2005-3, evidencing the beneficial ownership interest in the Issuer and

 

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executed by the Owner Trustee in substantially the form set forth in Exhibit A to the Trust Agreement.

Certificateholder or Holder: The Person in whose name a Certificate is registered in the Certificate Register. Owners of Certificates that have been pledged in good faith may be regarded as Holders if the pledgee establishes to the satisfaction of the Certificate Registrar or the Owner Trustee, as the case may be, the pledgee’s right so to act with respect to such Certificates and that the pledgee is not the Issuer, any other obligor upon the Certificates or any Affiliate of any of the foregoing Persons.

Class: Any of the Class A, Class M or Class B Notes.

Class A Notes: The Class I-A, Class II-A and Class III-A Notes in the form attached as Exhibit A-1 to the Indenture.

Class A Principal Allocation Fraction: For any Payment Date and (i) the Class I-A Notes, (ii) the Class II-A Notes and (iii) the Class III-A Notes, as determined separately, a fraction, (x) the numerator of which is the Principal Remittance Amount with respect to the Mortgage Loans in the related Loan Group to be distributed on that Payment Date, and (y) the denominator of which is the Principal Remittance Amount for all of the Mortgage Loans to be distributed on that Payment Date.

Class A Principal Distribution Amount: For any applicable Payment Date on or after the related Stepdown Date as long as a related Trigger Event has not occurred with respect to such Payment Date, an amount equal to the lesser of (A) the related aggregate Principal Distribution Amount for such Payment Date and (B) the excess (if any) of (x) the aggregate Note Principal Balance of the Class A Notes immediately prior to such Payment Date over (y) the lesser of (a) the aggregate Stated Principal Balance of the Mortgage Loans as of the last day of the related Due Period (after giving effect to scheduled payments of principal due during the related Due Period, to the extent received or advanced, and unscheduled collections of principal received during the related Prepayment Period, and after reduction for Realized Losses incurred during the related Prepayment Period) multiplied by approximately 86.90% and (b) the amount, if any, by which (i) the aggregate Stated Principal Balance of the Mortgage Loans as of the last day of the related Due Period (after giving effect to scheduled payments of principal due during the related Due Period, to the extent received or advanced, and unscheduled collections of principal received during the related Prepayment Period, and after reduction for Realized Losses incurred during the related Prepayment Period) exceeds (ii) 0.35% of the Cut-off Date Balance.

Class B Notes: The Class B Notes in the form attached as Exhibit A-3 to the Indenture.

Class B Principal Distribution Amount: For any applicable Payment Date on or after the Stepdown Date as long as a Trigger Event has not occurred with respect to such Payment Date, an amount equal to the excess (if any) of (x) the sum of (i) the aggregate Note Principal Balance of the Class A Notes and Class M Notes (after taking into account the distribution of the Class A, Class M-1, Class M-2, Class M-3, Class M-4, Class M-5 and Class M-6 Principal Distribution Amounts on such Payment Date) and (ii) the Note Principal Balance of the Class B Notes

 

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immediately prior to such Payment Date over (y) the lesser of (a) the aggregate Stated Principal Balance of the Mortgage Loans as of the last day of the related Due Period (after giving effect to scheduled payments of principal due during the related Due Period, to the extent received or advanced, and unscheduled collections of principal received during the related Prepayment Period, and after reduction for Realized Losses incurred during the related Prepayment Period) multiplied by approximately 99.30% and (b) the amount, if any, by which (i) the aggregate Stated Principal Balance of the Mortgage Loans as of the last day of the related Due Period (after giving effect to scheduled payments of principal due during the related Due Period, to the extent received or advanced, and unscheduled collections of principal received during the related Prepayment Period, and after reduction for Realized Losses incurred during the related Prepayment Period) exceeds (ii) 0.35% of the Cut-off Date Balances.

Class I-A Corridor Contract: The interest rate Corridor Contract between the Owner Trustee (or assigned to the Owner Trustee) on behalf of the Trust and the Derivative Counterparty primarily for the benefit of the Class I-A Notes.

Class I-A Notes: The Class I-A-1 and Class I-A-2 Notes.

Class II-A-1 Corridor Contract: The interest rate Corridor Contract between the Owner Trustee (or assigned to the Owner Trustee) on behalf of the Trust and the Derivative Counterparty primarily for the benefit of the Class II-A-1 Notes.

Class II-A Notes: The Class II-A-1, Class II-A-2, Class II-A-3 and Class II-A-4 Notes.

Class III-A-2 Corridor Contract: The interest rate Corridor Contract between the Owner Trustee (or assigned to the Owner Trustee) on behalf of the Trust and the Derivative Counterparty primarily for the benefit of the Class III-A-2 Notes.

Class III-A Notes: The Class III-A-1, Class III-A-2, Class III-A-3 and Class III-A-4 Notes.

Class III-A-1 Priority Amount: For any Payment Date, the lesser of (i) the Note Principal Balance of the Class III-A-1 Notes immediately prior to such Payment Date and (ii) the product of (x)(A) with respect to any Payment Date prior to the Stepdown Date or for which a Trigger Event is in effect, the Principal Distribution Amount payable to the Holders of the Class III-A Notes on that Payment Date, or (B) with respect to any Payment Date on or after the Stepdown Date and for which Trigger Event is not in effect, the Class A Principal Distribution Amount payable to the Holders of the Class III-A Notes on that Payment Date, (y) the Class III-A-1 Percentage and (z) the Class III-A-1 Shift Percentage.

Class III-A-1 Percentage: For any Payment Date, the lesser of (i) 100% and (ii) the percentage obtained by dividing (x) the Note Principal Balance of the Class III-A-1 Notes immediately prior to such Payment Date by (y) the aggregate Note Principal Balance of the Class III-A Notes immediately prior to such Payment Date.

 

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Class III-A-1 Shift Percentage: For any Payment Date occurring prior to the 37^th Payment Date, 0%; for the 37^th through 60^th Payment Dates, 45%; for the 61^st through 72^nd Payment Dates, 80%; for the 73^rd through 84^th Payment Dates, 100%; and thereafter, 300%.

Class M-1 through M-4 Corridor Contract: The interest rate Corridor Contract between the Owner Trustee (or assigned to the Owner Trustee) on behalf of the Trust and the Derivative Counterparty primarily for the benefit of the Class M-1, Class M-2, Class M-3 and Class M-4 Notes.

Class M Notes: The Class M-1, Class M-2, Class M-3, Class M-4, Class M-5 and M-6 Notes in the form attached as Exhibit A-2 to the Indenture.

Class M-1 Principal Distribution Amount: For any applicable Payment Date on or after the related Stepdown Date as long as a related Trigger Event has not occurred with respect to such Payment Date, an amount equal to the excess (if any) of (x) the sum of (i) the aggregate Note Principal Balance of the Class A Notes (after taking into account the distribution of the Class A Principal Distribution Amount on such Payment Date) and (ii) the Note Principal Balance of the Class M-1 Notes immediately prior to such Payment Date over (y) the lesser of (a) the aggregate Stated Principal Balance of the Mortgage Loans as of the last day of the related Due Period (after giving effect to scheduled payments of principal due during the related Due Period, to the extent received or advanced, and unscheduled collections of principal received during the related Prepayment Period, and after reduction for Realized Losses incurred during the related Prepayment Period) multiplied by approximately 89.70% and (b) the amount, if any, by which (i) the aggregate Stated Principal Balance of the Mortgage Loans as of the last day of the related Due Period (after giving effect to scheduled payments of principal due during the related Due Period, to the extent received or advanced, and unscheduled collections of principal received during the related Prepayment Period, and after reduction for Realized Losses incurred during the related Prepayment Period) exceeds (ii) 0.35% of the Cut-off Date Balance.

Class M-2 Principal Distribution Amount: For any applicable Payment Date on or after the related Stepdown Date as long as a related Trigger Event has not occurred with respect to such Payment Date, an amount equal to the excess (if any) of (x) the sum of (i) the aggregate Note Principal Balance of the Class A Notes and Class M-1 Notes (after taking into account the distribution of the Class A and Class M-1 Principal Distribution Amounts on such Payment Date) and (ii) the Note Principal Balance of the Class M-2 Notes immediately prior to such Payment Date over (y) the lesser of (a) the aggregate Stated Principal Balance of the Mortgage Loans as of the last day of the related Due Period (after giving effect to scheduled payments of principal due during the related Due Period, to the extent received or advanced, and unscheduled collections of principal received during the related Prepayment Period, and after reduction for Realized Losses incurred during the related Prepayment Period) multiplied by approximately 92.70% and (b) the amount, if any, by which (i) the aggregate Stated Principal Balance of the Mortgage Loans as of the last day of the related Due Period (after giving effect to scheduled payments of principal due during the related Due Period, to the extent received or advanced, and unscheduled collections of principal received during the related Prepayment Period, and after reduction for Realized Losses incurred during the related Prepayment Period) exceeds (ii) 0.35% of the Cut-off Date Balance.

 

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Class M-3 Principal Distribution Amount: For any applicable Payment Date on or after the Stepdown Date as long as a Trigger Event has not occurred with respect to such Payment Date, an amount equal to the excess (if any) of (x) the sum of (i) the aggregate Note Principal Balance of the Class A, Class M-1 and Class M-2 Notes (after taking into account the distribution of the Class A, Class M-1 and Class M-2 Principal Distribution Amounts on such Payment Date) and (ii) the Note Principal Balance of the Class M-3 Notes immediately prior to such Payment Date over (y) the lesser of (a) the aggregate Stated Principal Balance of the Mortgage Loans as of the last day of the related Due Period (after giving effect to scheduled payments of principal due during the related Due Period, to the extent received or advanced, and unscheduled collections of principal received during the related Prepayment Period, and after reduction for Realized Losses incurred during the related Prepayment Period) multiplied by approximately 94.30% and (b) the amount, if any, by which (i) the aggregate Stated Principal Balance of the Mortgage Loans as of the last day of the related Due Period (after giving effect to scheduled payments of principal due during the related Due Period, to the extent received or advanced, and unscheduled collections of principal received during the related Prepayment Period, and after reduction for Realized Losses incurred during the related Prepayment Period) exceeds (ii) 0.35% of the Cut-off Date Balance.

Class M-4 Principal Distribution Amount: For any applicable Payment Date on or after the Stepdown Date as long as a Trigger Event has not occurred with respect to such Payment Date, an amount equal to the excess (if any) of (x) the sum of (i) the aggregate Note Principal Balance of the Class A, Class M-1, Class M-2 and Class M-3 Notes (after taking into account the distribution of the Class A, Class M-1, Class M-2 and Class M-3 Principal Distribution Amounts on such Payment Date) and (ii) the Note Principal Balance of the Class M-4 Notes immediately prior to such Payment Date over (y) the lesser of (a) the aggregate Stated Principal Balance of the Mortgage Loans as of the last day of the related Due Period (after giving effect to scheduled payments of principal due during the related Due Period, to the extent received or advanced, and unscheduled collections of principal received during the related Prepayment Period, and after reduction for Realized Losses incurred during the related Prepayment Period) multiplied by approximately 95.30% and (b) the amount, if any, by which (i) the aggregate Stated Principal Balance of the Mortgage Loans as of the last day of the related Due Period (after giving effect to scheduled payments of principal due during the related Due Period, to the extent received or advanced, and unscheduled collections of principal received during the related Prepayment Period, and after reduction for Realized Losses incurred during the related Prepayment Period) exceeds (ii) 0.35% of the Cut-off Date Balance.

Class M-5 Principal Distribution Amount: For any applicable Payment Date on or after the Stepdown Date as long as a Trigger Event has not occurred with respect to such Payment Date, an amount equal to the excess (if any) of (x) the sum of (i) the aggregate Note Principal Balance of the Class A, Class M-1, Class M-2, Class M-3 and Class M-4 Notes (after taking into account the distribution of the Class A, Class M-1, Class M-2, Class M-3 and Class M-4 Principal Distribution Amounts on such Payment Date) and (ii) the Note Principal Balance of the Class M-5 Notes immediately prior to such Payment Date over (y) the lesser of (a) the aggregate Stated Principal Balance of the Mortgage Loans as of the last day of the related Due Period (after giving effect to scheduled payments of principal due during the related Due Period, to the extent received or advanced, and unscheduled collections of principal received during the related

 

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Prepayment Period, and after reduction for Realized Losses incurred during the related Prepayment Period) multiplied by approximately 96.30% and (b) the amount, if any, by which (i) the aggregate Stated Principal Balance of the Mortgage Loans as of the last day of the related Due Period (after giving effect to scheduled payments of principal due during the related Due Period, to the extent received or advanced, and unscheduled collections of principal received during the related Prepayment Period, and after reduction for Realized Losses incurred during the related Prepayment Period) exceeds (ii) 0.35% of the Cut-off Date Balance.

Class M-6 Principal Distribution Amount: For any applicable payment date on or after the Stepdown Date as long as a Trigger Event has not occurred with respect to such payment date, an amount equal to the excess (if any) of (x) the sum of (i) the aggregate Note Principal Balance of the Class A, Class M-1, Class M-2, Class M-3, Class M-4 and Class M-5 Notes (after taking into account the distribution of the Class A, Class M-1, Class M-2, Class M-3, Class M-4 and Class M-5 Principal Distribution Amounts on such payment date) and (ii) the Note Principal Balance of the Class M-6 Notes immediately prior to such payment date over (y) the lesser of (a) the aggregate Stated Principal Balance of the Mortgage Loans as of the last day of the related Due Period (after giving effect to scheduled payments of principal due during the related Due Period, to the extent received or advanced, and unscheduled collections of principal received during the related Prepayment Period, and after reduction for Realized Losses incurred during the related Prepayment Period) multiplied by approximately 97.30% and (b) the amount, if any, by which (i) the aggregate Stated Principal Balance of the Mortgage Loans as of the last day of the related Due Period (after giving effect to scheduled payments of principal due during the related Due Period, to the extent received or advanced, and unscheduled collections of principal received during the related Prepayment Period, and after reduction for Realized Losses incurred during the related Prepayment Period) exceeds (ii) 0.35% of the Cut-off Date Balance.

Clearing Agency: An organization registered as a “clearing agency” pursuant to Section 17A of the Securities and Exchange Act of 1934, as amended, which initially shall be the Depository.

Closing Date: September 20, 2005.

Code: The Internal Revenue Code of 1986, as amended, and the rules and regulations promulgated thereunder.

Collateral: The meaning specified in the Granting Clause of the Indenture.

Commission: The Securities and Exchange Commission.

Compensating Interest: With respect to any Payment Date as determined separately for each Loan Group, the amount of any Prepayment Interest Shortfalls resulting from prepayments in full or in part during the preceding calendar month on the related Mortgage Loans required to be paid by the Servicer pursuant to Servicing Agreement and, in case the Servicer fails to do so, by the Master Servicer, pursuant to Section 4.05 of the Master Servicer Agreement, but only to the extent such Prepayment Interest Shortfalls do not exceed the Servicing Fee for such Payment Date for such Loan Group or amounts paid or required to be paid by the Servicer or, in the case

 

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of the Master Servicer is required to make such payment, do not exceed the Master Servicer Compensation for such Payment Date.

Corporate Trust Office: With respect to the Indenture Trustee, the principal corporate trust office of the Indenture Trustee at which at any particular time its corporate trust business shall be administered, which office at the date of the execution of this instrument is located at 1791 East St. Andrew Place, Santa Ana, California 92705, Attention: Trust Administration - AH0503. The Indenture Trustee shall notify all Noteholders of any change in the location of the Corporate Trust Office. With respect to the Owner Trustee, the principal corporate trust office of the Owner Trustee at which at any particular time its corporate trust business shall be administered, which office at the date of the execution of this Trust Agreement is located at Wilmington Trust Company, Rodney Square North, 1100 North Market Street, Wilmington, Delaware 19801, Attention: American Home Mortgage Investment Trust 2005-3.

Corridor Contracts: Any of the Class I-A Corridor Contract, Class II-A-1 Corridor Contract, Class III-A-2 Corridor Contract or Class M-1 through Class M-4 Corridor Contract.

CPR: A constant rate of prepayment on the Mortgage Loans.

Credit Enhancement Percentage: With respect to the Class A Notes and any Payment Date, the percentage equivalent of a fraction, the numerator of which is (a) the sum of the aggregate Note Principal Balance of the Class M Notes and Class B Notes and the related Overcollateralized Amount and the denominator of which is (b) the aggregate Stated Principal Balance of the Mortgage Loans at the end of the related Due Period.

Cumulative Losses: As to any Payment Date and the Mortgage Loans, the cumulative aggregate amount of Realized Losses on the Mortgage Loans from the Cut-off Date through the end of the calendar month immediately preceding such Payment Date.

Cut-off Date: September 1, 2005.

Cut-off Date Balance: The aggregate Stated Principal Balance of the Mortgage Loans as of the Cut-off Date.

Cut-off Date Principal Balance: With respect to any Mortgage Loan, the unpaid principal balance thereof as of the Cut-off Date after applying the principal portion of Monthly Payments due on or before such date, whether or not received, and without regard to any payments due after such date.

Debt Service Reduction: With respect to any Mortgage Loan, a reduction in the scheduled Monthly Payment for such Mortgage Loan by a court of competent jurisdiction in a proceeding under the Bankruptcy Code, except such a reduction constituting a Deficient Valuation or any reduction that results in a permanent forgiveness of principal.

Default: Any occurrence which with notice or the lapse of time or both would become an Event of Default.

 

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Deficient Valuation: With respect to any Mortgage Loan, a valuation by a court of competent jurisdiction of the Mortgaged Property in an amount less than the then outstanding indebtedness under the Mortgage Loan, or any reduction in the amount of principal to be paid in connection with any scheduled Monthly Payment that constitutes a permanent forgiveness of principal, which valuation or reduction results from a proceeding under the Bankruptcy Code.

Definitive Notes: The meaning specified in Section 4.08 of the Indenture.

Deleted Mortgage Loan: A Mortgage Loan replaced or to be replaced with an Eligible Substitute Mortgage Loan.

Delinquency Rate: For any month, the fraction, expressed as a percentage, the numerator of which is the aggregate outstanding principal balance of all Mortgage Loans 60 or more days delinquent (including all foreclosures, Mortgage Loans subject to bankruptcy proceedings and REO Properties) as of the close of business on the last day of such month, as reported by the Servicer to the Securities Administrator, and the denominator of which is the aggregate Stated Principal Balance of the Mortgage Loans as of the close of business on the last day of such month.

Depositor: American Home Mortgage Securities LLC, a Delaware limited liability company, or its successor in interest.

Depository or Depository Agency: The Depository Trust Company or a successor appointed by the Indenture Trustee. Any successor to the Depository shall be an organization registered as a “clearing agency” pursuant to Section 17A of the Exchange Act and the regulations of the Securities and Exchange Commission thereunder.

Depository Agreement: With respect to the Class of Book-Entry Notes, the agreement among the Issuer, the Indenture Trustee and the initial Depository, dated as of the Closing Date.

Depository Participant: A Person for whom, from time to time, the Depository effects book-entry transfers and pledges of securities deposited with the Depository.

Derivative Contracts: Any of the Corridor Contracts.

Derivative Contract Formula Amount: With respect to the Class I-A Corridor Contract and any Payment Date, an amount determined by the Derivative Counterparty and provided to the Securities Administrator no later than 5 Business Days prior to each Payment Date, equal to the product of (i) the excess, if any, of the lesser of (1) One-Month LIBOR (as determined pursuant to the Corridor Contract) over the Strike Rate for such Payment Date and (2) the Ceiling Rate for such Payment Date over the Strike Rate for such Payment Date, (ii) an amount equal to the notional balance for such Payment Date (which will be the lesser of (a) the notional balance on the schedule and (b) the aggregate Note Principal Balance of the Class I-A Notes) and (iii) 1/12. With respect to the Class II-A-1 Corridor Contract and any Payment Date, an amount determined by the Derivative Counterparty and provided to the Securities Administrator no later than 5 Business Days prior to each Payment Date, equal to the product of (i) the excess, if any, of the lesser of (1) One-Month LIBOR (as determined pursuant to the Corridor Contract) over the

 

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Strike Rate for such Payment Date and (2) the Ceiling Rate for such Payment Date over the Strike Rate for such Payment Date, (ii) an amount equal to the notional balance for such Payment Date (which will be the lesser of (a) the notional balance on the schedule and (b) the aggregate Note Principal Balance of the Class II-A-1 Notes) and (iii) 1/12. With respect to the Class III-A-2 Corridor Contract and any Payment Date, an amount determined by the Derivative Counterparty and provided to the Securities Administrator no later than 5 Business Days prior to each Payment Date, equal to the product of (i) the excess, if any, of the lesser of (1) One-Month LIBOR (as determined pursuant to the Corridor Contract) over the Strike Rate for such Payment Date and (2) the Ceiling Rate for such Payment Date over the Strike Rate for such Payment Date, (ii) an amount equal to the notional balance for such Payment Date (which will be the lesser of (a) the notional balance on the schedule and (b) the aggregate Note Principal Balance of the Class III-A-2 Notes) and (iii) 1/12. With respect to the Class M-1 through M-4 Corridor Contract and any Payment Date, an amount determined by the Derivative Counterparty and provided to the Securities Administrator no later than 5 Business Days prior to each Payment Date, equal to the product of (i) the excess, if any, of the lesser of (1) One-Month LIBOR (as determined pursuant to the Corridor Contract) over the Strike Rate for such Payment Date and (2) the Ceiling Rate for such Payment Date over the Strike Rate for such Payment Date, (ii) an amount equal to the notional balance for such Payment Date (which will be the lesser of (a) the notional balance on the schedule and (b) the aggregate Note Principal Balance of the Class M-1, Class M-2, Class M-3 and Class M-4 Notes) and (iii) 1/12.

Derivative Counterparty: IXIS Financial Products Inc.

Determination Date: With respect to any Payment Date, the 15th of the related month, or if the 15th day of such month is not a Business Day, the immediately preceding Business Day.

Due Date: With respect to each Mortgage Loan, the date in each month on which its Monthly Payment is due, exclusive of any days of grace.

Due Period: With respect to any Payment Date and the Mortgage Loans, the period commencing on the second day of the month immediately preceding the month in which such Payment Date occurs and ending on the first day of the month in which such Payment Date occurs.

Eligible Account: An account that is any of the following: (i) a segregated account maintained with a federal or state chartered depository institution (A) the short-term obligations of which are rated A-1+ or better by Standard & Poor’s and P-1 by Moody’s at the time of any deposit therein or (B) fully insured to the limits established by the FDIC, provided that any deposits not so insured shall, to the extent acceptable to the Rating Agencies, as evidenced in writing, be maintained such that (as evidenced by an Opinion of Counsel delivered to the Indenture Trustee and the Rating Agencies) the Indenture Trustee has a claim with respect to the funds in such account or a perfected first security interest against any collateral (which shall be limited to Eligible Investments) securing such funds that is superior to claims of any other depositors or creditors of the depository institution with which such account is maintained, (ii) a segregated trust account or accounts maintained with a federal or state chartered depository institution or trust company subject to regulations regarding fiduciary funds on deposit similar to

 

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Title 12 of the Code of Federal Regulations Section 9.10(b), which, in either case, has corporate trust powers, acting in its fiduciary capacity, or (iii) in the case of the Servicing Account, either (A) a trust account or accounts maintained at the corporate trust department of the Indenture Trustee or the Securities Administrator or (B) an account or accounts maintained at the corporate trust department of the Master Servicer (or an affiliate thereof), as long as its short term debt obligations are rated F-1 by Fitch Ratings, P-1 by Moody’s and A-1 by Standard & Poor’s or better and their long term debt obligations are rated A by Fitch Ratings, A2 by Moody’s and A by Standard & Poor’s or better, or (iv) an account or accounts of a depository institution acceptable to the Rating Agencies as evidenced in writing by the Rating Agencies that use of any such account as the Protected Account or the Payment Account will not reduce the rating assigned to any of the Securities by such Rating Agency below investment grade.

Eligible Investments: One or more of the following:

(i)           obligations of or guaranteed as to principal and interest by the United States or any agency or instrumentality thereof when such obligations are backed by the full faith and credit of the United States;

(ii)          repurchase agreements on obligations specified in clause (i) maturing not more than one month from the date of acquisition thereof, provided that the unsecured obligations of the party agreeing to repurchase such obligations are at the time rated by the Rating Agencies in their respective highest short-term rating available;

(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 or of any domestic branch of a foreign depository institution or trust company; provided that the debt obligations of such depository institution or trust company (or, if the only Rating Agency is Standard & Poor’s, in the case of the principal depository institution in a depository institution holding company, debt obligations of the depository institution holding company) at the date of acquisition thereof have been rated by the Rating Agencies in their respective highest short-term rating available; and provided further that, if the only Rating Agency is Standard & Poor’s and if the depository or trust company is a principal subsidiary of a bank holding company and the debt obligations of such subsidiary are not separately rated, the applicable rating shall be that of the bank holding company; and, provided further that, if the original maturity of such short-term obligations of a domestic branch of a foreign depository institution or trust company shall exceed 30 days, the short-term rating of such institution shall be A-1+ in the case of Standard & Poor’s if Standard & Poor’s is the Rating Agency;

(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 on the date of acquisition has been rated by Moody’s and Standard &

 

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Poor’s in their highest short-term ratings available; provided that such commercial paper shall have a remaining maturity of not more than 30 days;

(v)          a money market fund or a qualified investment fund rated by Moody’s in its highest long-term ratings available and rated AAAm or AAAm-G by Standard & Poor’s, including any such funds for which Deutsche Bank National Trust Company (or any successor Indenture Trustee) or the Securities Administrator or any affiliate thereof serves as an investment advisor, manager, administrator, shareholder, servicing agent, and/or custodian or sub-custodian; and

(vi)         other obligations or securities that are acceptable to each Rating Agency as a Permitted Investment hereunder and will not reduce the rating assigned to any Class of Notes by such Rating Agency below the lower of the then-current rating or the rating assigned to such Notes as of the Closing Date by such Rating Agency, as evidenced in writing; and

(vii)       any investment approved in writing by each of the Rating Agencies.

Each of the Indenture Trustee and the Securities Administrator may purchase from or sell to itself or an affiliate, as principal or agent, the Eligible Investments listed above.

provided, however, that no instrument shall be an Eligible Investment if it represents, either (1) the right to receive only interest payments with respect to the underlying debt instrument or (2) the right to receive both principal and interest payments derived from obligations underlying such instrument and the principal and interest payments with respect to such instrument provide a yield to maturity greater than 120% of the yield to maturity at par of such underlying obligations.

Eligible Substitute Mortgage Loan: A Mortgage Loan substituted by the Seller for a Deleted Mortgage Loan which must, on the date of such substitution, as confirmed in an Officer’s Certificate delivered to the Indenture Trustee, (i) have an outstanding principal balance, after deduction of the principal portion of the monthly payment due in the month of substitution (or in the case of a substitution of more than one Mortgage Loan for a Deleted Mortgage Loan, an aggregate outstanding principal balance, after such deduction), not in excess of the outstanding principal balance of the Deleted Mortgage Loan (the amount of any shortfall to be deposited by the Seller in the Protected Account in the month of substitution); (ii) comply with each non-statistical representation and warranty set forth in Section 3.1(b) of the Mortgage Loan Purchase Agreement as of the date of substitution; (iii) have a Mortgage Rate no lower than and not more than 1% per annum higher than the Mortgage Rate of the Deleted Mortgage Loan as of the date of substitution; (iv) have a Loan-to-Value Ratio at the time of substitution no higher than that of the Deleted Mortgage Loan at the time of substitution; (v) have a remaining term to stated maturity not greater than (and not more than one year less than) that of the Deleted Mortgage Loan; (vi) not be 30 days or more delinquent; (vii) be an adjustable-rate first lien Mortgage Loan, if being substituted for an ARM Loan; and (viii) be a fixed-rate first lien Mortgage Loan, if being substituted for a Fixed Rate Loan.

 

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ERISA: The Employee Retirement Income Security Act of 1974, as amended.

Event of Default: Any one of the following: (a) the failure by the Issuer to pay Accrued Note Interest on any Class of Notes, with respect to a Payment Date on such Payment Date; (b) a default by the Issuer in the observance of certain negative covenants in the Indenture; (c) a default by the Issuer in the observance of any other covenant of the Indenture, and the continuation of any such default for a period of thirty days after notice to the Issuer by the Indenture Trustee; (d) any representation or warranty made by the Issuer in the Indenture or in any Note or other writing delivered pursuant thereto having been incorrect in a material respect as of the time made, and the circumstance in respect of which such representation or warranty is incorrect not having been cured within thirty days after notice thereof is given to the Issuer by the Indenture Trustee or by the Holders of at least 25% of the aggregate Note Principal Balance of the Notes, as applicable; (e) certain events of bankruptcy, insolvency, receivership or reorganization of the Issuer; or (f) the failure by the Issuer on the Final Scheduled Payment Date to pay all Accrued Note Interest, all remaining Basis Risk Shortfall Carry-Forward Amounts or Net WAC Carry-Forward Shortfall Amounts, as applicable, and to reduce the Note Principal Balances of all of the Notes to zero.

Event of Master Servicer Termination: With respect to the Master Servicing Agreement, a Servicing Default as defined in Section 6.01 of the Master Servicing Agreement.

Excess Basis Risk Capacity: With respect to each Derivative Contract and any Payment Date, an amount equal to the excess, if any, of the Derivative Contract Formula Amount with respect to such related Derivative Contract for such Payment Date over the Basis Risk Shortfall Carry-Forward Amount with respect to the related Class of Notes for such Payment Date.

Excess Basis Risk Shortfall Carry-Forward Amount: With respect to the Class I-A, Class II-A-1, Class III-A-2, Class M-1, Class M-2, Class M-3 and Class M-4 Notes for any Payment Date, an amount equal to the excess, if any, of the Basis Risk Shortfall Carry-Forward Amount with respect to such Class of Notes for such Payment Date over the related Derivative Contract Formula Amount with respect to the related Derivative Contract for such Payment Date.

Excess Derivative Payment Amount: For any Payment Date, the excess of amounts payable from the Corridor Contracts on that Payment Date over the amount of Basis Risk Shortfall Carry-Forward Amounts payable to the Class I-A, Class II-A-1, Class III-A-2, Class M-1, Class M-2, Class M-3 and Class M-4 Notes on that Payment Date.

Exchange Act: The Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

Expenses: The meaning specified in Section 7.02 of the Trust Agreement.

Fannie Mae: Fannie Mae (formerly, the Federal National Mortgage Association), or any successor thereto.

FDIC: The Federal Deposit Insurance Corporation or any successor thereto.

 

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Final Certification: The final certification delivered by the Custodian pursuant to Section 2.03(a)(i) of the Indenture and in the form attached as Exhibit Two thereto.

Final Payment Date: With respect to the Class VI-A Notes, the Payment Date occurring in August 2035.

Final Scheduled Payment Date: With respect to each Class of Notes, the Payment Date in September 2035.

Fixed Rate Loans: At any time, collectively, all the Mortgage Loans which have fixed Mortgage Rates.

Foreclosure Profit: With respect to a Liquidated Mortgage Loan the amount, if any, by which (i) the aggregate of its Net Liquidation Proceeds exceeds (ii) the related Stated Principal Balance (plus accrued and unpaid interest thereon at the applicable Mortgage Rate from the date interest was last paid through the date of receipt of the final Liquidation Proceeds) of such Liquidated Mortgage Loan immediately prior to the final recovery of its Liquidation Proceeds.

Freddie Mac: Freddie Mac (also known as the Federal Home Loan Mortgage Corporation), or any successor thereto.

Grant: Pledge, bargain, sell, warrant, alienate, remise, release, convey, assign, transfer, create, and grant a lien upon and a security interest in and right of set-off against, deposit, set over and confirm pursuant to the Indenture. A Grant of the Collateral or of any other agreement or instrument shall include all rights, powers and options (but none of the obligations) of the granting party thereunder, including the immediate and continuing right to claim for, collect, receive and give receipt for principal and interest payments in respect of such collateral or other agreement or instrument and all other moneys payable thereunder, to give and receive notices and other communications, to make waivers or other agreements, to exercise all rights and options, to bring proceedings in the name of the granting party or otherwise, and generally to do and receive anything that the granting party is or may be entitled to do or receive thereunder or with respect thereto.

Gross Margin: With respect to any ARM Loan, the percentage set forth as the “Gross Margin” for such Mortgage Loan on the Mortgage Loan Schedule, as adjusted from time to time in accordance with the terms of the Servicing Agreement.

Group I Available Funds: For any Payment Date, an amount equal to the amount received by the Indenture Trustee and available in the Payment Account on that Payment Date in respect of the Group I Loans. The Group I Available Funds generally includes: (1) all previously undistributed payments on account of principal (including the principal portion of Monthly Payments, Principal Prepayments and the principal amount of Net Liquidation Proceeds) and all previously undistributed payments on account of interest received after the Cut-Off Date and on or prior to the related Determination Date from the Group I Loans and (2) any Monthly Advances and Compensating Interest Payments on the Group I Loans made by the Servicer for such Payment Date and (3) any amounts reimbursed by the Servicer, the Indenture Trustee or the

 

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Securities Administrator in connection with losses on certain eligible investments in the Protected Accounts, Securities Administrator Collection Account or Payment Account, as applicable, and is net of (4) fees payable to, and other amounts reimbursable to, the Indenture Trustee, the Master Servicer, the Servicer, the Securities Administrator and the Owner Trustee and other amounts as provided in the Basic Documents allocable to the Group I Loans, or, if any such reimbursable amounts are not allocable to the Group I Loans, then the Group I Loans’ pro rata share of such amounts. For purposes of this definition, “pro rata share” shall be a fraction, the numerator of which is equal to the aggregate of the Stated Principal Balance of the Group I Loans for such Payment Date and the denominator of which is equal to the Pool Balance for such Payment Date.

Group I Loan: A Mortgage Loan in Loan Group I.

Group II Available Funds: For any Payment Date, an amount equal to the amount received by the Indenture Trustee and available in the Payment Account on that Payment Date in respect of the Group II Loans. The Group II Available Funds generally includes: (1) all previously undistributed payments on account of principal (including the principal portion of Monthly Payments, Principal Prepayments and the principal amount of Net Liquidation Proceeds) and all previously undistributed payments on account of interest received after the Cut-Off Date and on or prior to the related Determination Date from the Group II Loans and (2) any Monthly Advances and Compensating Interest Payments on the Group II Loans made by the Servicer for such Payment Date and (3) any amounts reimbursed by the Servicer, the Indenture Trustee or the Securities Administrator in connection with losses on certain eligible investments in the Protected Accounts, Securities Administrator Collection Account or Payment Account, as applicable, and is net of (4) fees payable to, and other amounts reimburseable to the Indenture Trustee, the Master Servicer, the Servicer, the Securities Administrator, the Owner Trustee and other amount as provided in the Agreements allocable to the Group II Loans, or, if any such reimbursable amounts are not allocable to the Group II Loans, then the Group II Loans’ pro rata share of such amounts. For purposes of this definition, “pro rata share” shall be a fraction, the numerator of which is equal to the aggregate of the Stated Principal Balance of the Group II Loans for such Payment Date and the denominator of which is equal to the Pool Balance for such Payment Date.

Group III Available Funds: For any Payment Date, an amount equal to the amount received by the Indenture Trustee and available in the Payment Account on that Payment Date in respect of the Group III Loans. The Group III Available Funds generally includes: (1) all previously undistributed payments on account of principal (including the principal portion of Monthly Payments, Principal Prepayments and the principal amount of Net Liquidation Proceeds) and all previously undistributed payments on account of interest received after the Cut-Off Date and on or prior to the related Determination Date from the Group III Loans and (2) any Monthly Advances and Compensating Interest Payments on the Group III Loans made by the Servicer for such Payment Date and (3) any amounts reimbursed by the Servicer, the Indenture Trustee or the Securities Administrator in connection with losses on certain eligible investments in the Protected Accounts, Securities Administrator Collection Account or Payment Account, as applicable, and is net of (4) fees payable to, and other amounts reimbursable to the Indenture Trustee, the Master Servicer, the Servicer, the Securities Administrator, the Owner

 

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Trustee and other amounts as provided in the Basic Documents allocable to the Group III Loans, or, if any such reimbursable amounts are not allocable to the Group III Loans, then the Group III Loans’ pro rata share of such amounts. For purposes of this definition, “pro rata share” shall be a fraction, the numerator of which is equal to the aggregate of the Stated Principal Balance of the Group III Loans for such Payment Date and the denominator of which is equal to the Pool Balance for such Payment Date.

Group III Loan: A Mortgage Loan in Loan Group III.

Hazardous Materials: Any dangerous, toxic or hazardous pollutants, chemicals, wastes, or substances, including, without limitation, those so identified pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601 et seq., or any other environmental laws now existing, and specifically including, without limitation, asbestos and asbestos-containing materials, polychlorinated biphenyls, radon gas, petroleum and petroleum products, urea formaldehyde and any substances classified as being “in inventory”, “usable work in progress” or similar classification which would, if classified unusable, be included in the foregoing definition.

Indemnified Party: The meaning specified in Section 7.02 of the Trust Agreement.

Indenture: The indenture dated as of September 20, 2005, between the Issuer, the Securities Administrator and the Indenture Trustee, relating to the American Home Mortgage Investment Trust 2005-3 Notes.

Indenture Trustee: Deutsche Bank National Trust Company, and its successors and assigns or any successor indenture trustee appointed pursuant to the terms of the Indenture.

Indenture Trustee Fee: All earnings on the funds from time to time in the Payment Account.

Independent: When used with respect to any specified Person, the Person (i) is in fact independent of the Issuer, any other obligor on the Notes, the Seller, the Master Servicer, the Depositor, American Home Mortgage Investment Corp. and any Affiliate of any of the foregoing Persons, (ii) does not have any direct financial interest or any material indirect financial interest in the Issuer, any such other obligor, the Seller, the Master Servicer, the Depositor, American Home Mortgage Investment Corp. or any Affiliate of any of the foregoing Persons and (iii) is not connected with the Issuer, any such other obligor, the Seller, the Master Servicer, the Depositor, American Home Mortgage Investment Corp. or any Affiliate of any of the foregoing Persons as an officer, employee, promoter, underwriter, trustee, partner, director or person performing similar functions.

Independent Certificate: A certificate or opinion to be delivered to the Indenture Trustee under the circumstances described in, and otherwise complying with, the applicable requirements of Section 10.01 of the Indenture, made by an independent appraiser or other expert appointed by an Issuer Request and approved by the Indenture Trustee in the exercise of reasonable care, and

 

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such opinion or certificate shall state that the signer has read the definition of “Independent” in this Indenture and that the signer is Independent within the meaning thereof.

Index: With respect to any Mortgage Loan, the index for the adjustment of the Mortgage Rate set forth as such in the related Mortgage Note.

Initial Note Principal Balance: The Notes shall have the following Initial Note Principal Balances:

 

Class		Initial Note Principal Balance
I-A-1		$	128,749,000
I-A-2		$	14,305,000
II-A-1		$	229,979,000
II-A-2		$	68,279,000
II-A-3		$	86,426,000
II-A-4		$	83,943,000
III-A-1		$	7,960,000
III-A-2		$	30,752,000
III-A-3		$	25,489,000
III-A-4		$	15,399,000
M-1		$	10,318,000
M-2		$	11,054,000
M-3		$	5,896,000
M-4		$	3,685,000
M-5		$	3,685,000
M-6		$	3,685,000
B		$	7,369,000

 

Initial Certification: The initial certification delivered by the Custodian pursuant to Section 2.03(a) of the Indenture and in the form attached thereto as Exhibit One thereto.

Insurance Proceeds: Proceeds paid by any insurer pursuant to any insurance policy covering a Mortgage Loan which are required to be remitted to the Servicer, net of any component thereof, released to the Mortgagor in accordance with the Servicer’s normal servicing procedures.

Interest Determination Date: With respect each Class of LIBOR Notes and (i) the first Accrual Period, the second LIBOR Business Day preceding the Closing Date, and (ii) with respect to each Accrual Period thereafter, the second LIBOR Business Day preceding the related Payment Date on which such Accrual Period commences.

Interest Rate Adjustment Date: With respect to each Mortgage Loan, the date or dates on which the Mortgage Rate is adjusted in accordance with the related Mortgage Note.

Interested Person: As of any date of determination, the Depositor, the Master Servicer, the Servicer, the Indenture Trustee, American Home Mortgage Investment Corp., any

 

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Mortgagor, or any Person actually known to a Responsible Officer of the Trustee to be an Affiliate of any of them.

Investment Company Act: The Investment Company Act of 1940, as amended, and any amendments thereto.

IRS: The Internal Revenue Service.

Issuer: American Home Mortgage Investment Trust 2005-3, a Delaware statutory trust, or its successor in interest.

Issuer Request: A written order or request signed in the name of the Issuer by any one of its Authorized Officers and delivered to the Indenture Trustee.

LIBOR Business Day: A day on which banks are open for dealing in foreign currency and exchange in London and New York City.

LIBOR Note: Any Class I-A, Class II-A-1, Class III-A-2, Class M-1, Class M-2, Class M-3 or Class M-4 Note, or any Class II-A-2, Class II-A-3 or Class II-A-4 Note after the related Note Rate Change Date.

Lien: Any mortgage, deed of trust, pledge, conveyance, hypothecation, assignment, participation, deposit arrangement, encumbrance, lien (statutory or other), preference, priority right or interest or other security agreement or preferential arrangement of any kind or nature whatsoever, including, without limitation, any conditional sale or other title retention agreement, any financing lease having substantially the same economic effect as any of the foregoing and the filing of any financing statement under the UCC (other than any such financing statement filed for informational purposes only) or comparable law of any jurisdiction to evidence any of the foregoing; provided, however, that any assignment pursuant to Section 6.02 of the Servicing Agreement or Master Servicing Agreement, as applicable, shall not be deemed to constitute a Lien.

Lifetime Rate Cap: With respect to each Mortgage Loan with respect to which the related Mortgage Note provides for a lifetime rate cap, the maximum Mortgage Rate permitted over the life of such Mortgage Loan under the terms of such Mortgage Note, as set forth in the Mortgage Loan Schedule.

Liquidated Mortgage Loan: With respect to any Payment Date, any Mortgage Loan in respect of which the Servicer has determined, in accordance with the servicing procedures specified in the Servicing Agreement as of the end of the related Due Period that substantially all Liquidation Proceeds which it reasonably expects to recover with respect to the disposition of the related Mortgaged Property or REO Property have been recovered.

Liquidation Expenses: Out-of-pocket expenses (exclusive of overhead) which are incurred by or on behalf of the Servicer in connection with the liquidation of any Mortgage Loan and not recovered under any insurance policy, such expenses including, without limitation, legal fees and expenses, any unreimbursed amount expended respecting the related Mortgage Loan

 

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and any related and unreimbursed expenditures for real estate property taxes or for property restoration, preservation or insurance against casualty loss or damage.

Liquidation Proceeds: Proceeds (including Insurance Proceeds) received in connection with the liquidation of any Mortgage Loan or related REO Property, whether through trustee’s sale, foreclosure sale or otherwise.

Loan Group: Any of Loan Group I, Loan Group II or Loan Group III.

Loan Group I: The Group I Loans.

Loan Group II: The Group II Loans.

Loan Group III: The Group III Loans.

Loan-to-Value Ratio: With respect to any Mortgage Loan, as of any date of determination, a fraction expressed as a percentage, the numerator of which is the then current principal amount of the Mortgage Loan, and the denominator of which is the Appraised Value of the related Mortgaged Property.

Loan Year: With respect to any Mortgage Loan, the one-year period commencing on the day succeeding the origination of such Mortgage Loan and ending on the anniversary date of such Mortgage Loan, and each annual period thereafter.

Lost Note Affidavit: With respect to any Mortgage Loan as to which the original Mortgage Note has been lost or destroyed and has not been replaced, an affidavit from the Seller certifying that the original Mortgage Note has been lost, misplaced or destroyed (together with a copy of the related Mortgage Note).

Majority Certificateholder: A Holder of a 50.01% or greater Certificate Percentage Interest of the Certificates.

Master Servicer: Wells Fargo Bank, N.A., a national banking association, and its successors and assigns.

Master Servicing Agreement: The Master Servicing Agreement dated as of September 20, 2005, among the Master Servicer, Securities Administrator, Indenture Trustee and Issuer.

Master Servicing Fee: With respect to each Mortgage Loan and any Payment Date, the fee payable monthly to the Master Servicer in respect of master servicing compensation that accrues at an annual rate equal to the Master Servicing Fee Rate multiplied by the Stated Principal Balance of such Mortgage Loan as of the first day of the related Due Period.

Master Servicing Fee Rate: With respect to any Mortgage Loan, 0.006%.

Maximum Note Interest Rate: With respect to any Payment Date and each class of the Class I-A, Class II-A-1, Class III-A-2, Class M-1, Class M-2, Class M-3 and Class M-4 Notes

 

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11.00%, and with respect to the Class II-A-2, Class II-A-3 and Class II-A-4 Notes and any Payment Date after the related Note Rate Change Date, 11.00% per annum.

Maximum Mortgage Rate: With respect to each ARM Loan, the maximum Mortgage Rate.

MERS: Mortgage Electronic Registration Systems, Inc., a corporation organized and existing under the laws of the State of Delaware, or any successor thereto.

MERS® System: The system of recording transfers of Mortgages electronically maintained by MERS.

MIN: The Mortgage Identification Number for Mortgage Loans registered with MERS on the MERS® System.

Minimum Mortgage Rate: With respect to each ARM Loan, the minimum Mortgage Rate.

MOM Loan: With respect to any Mortgage Loan, MERS acting as the mortgagee of such Mortgage Loan, solely as nominee for the originator of such Mortgage Loan and its successors and assigns, at the origination thereof.

Monthly Advance: The aggregate of all payments of principal and interest, net of the Servicing Fee and, in the case of a Monthly Advance made by the Master Servicer, the Master Servicing Fee, that were due during the related Due Period on the Mortgage Loans and that were delinquent on the related Due Date (other than shortfalls in interest due to the application of the Relief Act or similar state law).

Monthly Payment: With respect to any Mortgage Loan (including any REO Property) and any Due Date, the payment of principal and interest due thereon in accordance with the amortization schedule at the time applicable thereto (after adjustment, if any, for partial Principal Prepayments and for Deficient Valuations occurring prior to such Due Date but before any adjustment to such amortization schedule by reason of any bankruptcy, other than a Deficient Valuation, or similar proceeding or any moratorium or similar waiver or grace period, and after any adjustment required by the Relief Act).

Moody’s: Moody’ Investors Service, Inc. or its successor in interest.

Mortgage: The mortgage, deed of trust or other instrument creating a first, second or third lien on an estate in fee simple interest in real property securing a Mortgage Loan.

Mortgage File: The file containing the Related Documents pertaining to a particular Mortgage Loan and any additional documents required to be added to the Mortgage File pursuant to the Mortgage Loan Purchase Agreement, Servicing Agreement, as applicable.

Mortgage Loans: The Mortgage Loans that will be transferred and assigned to the Trust pursuant to Section 2.03(a) of the Indenture, each Mortgage Loan so held being identified in the

 

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Mortgage Loan Schedule. The Mortgage Loans have been divided into three groups, Loan Group I, Loan Group II and Loan Group III.

Mortgage Loan Purchase Agreement: The Mortgage Loan Purchase Agreement, dated as of the Closing Date, between the Seller, as seller, and the Purchaser, as purchaser, relating to the sale, transfer and assignment of the Mortgage Loans.

Mortgage Loan Schedule: With respect to any date, the schedule of Mortgage Loans held by the Issuer on such date. The schedule of Mortgage Loans as of the Cut-off Date is the schedule set forth in Exhibit B of the Indenture, which schedule sets forth as to each Mortgage Loan:

(i)	the loan number and name of the Mortgagor;
(ii)	the street address, city, state and zip code of the Mortgaged Property;
(iii)	the original Mortgage Rate;
(iv)	the maturity date;
(v)	the original principal balance;
(vi)	the first Payment Date;
(vii)	the type of Mortgaged Property;
(viii)	the Monthly Payment in effect as of the Cut-off Date;
(ix)	the Cut-off Date Principal Balance;
(x)	the Index and the Gross Margin, if applicable;
(xi)	the Adjustment Date frequency and Payment Date frequency, if applicable;
(xii)	the occupancy status;
(xiii)	the purpose of the Mortgage Loan;
(xiv)	the Appraised Value of the Mortgaged Property;
(xv)	the original term to maturity;
(xvi)	the paid-through date of the Mortgage Loan;
(xvii)	the Loan-to-Value Ratio;

 

 

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(xviii)	whether or not the Mortgage Loan was underwritten pursuant to a limited documentation program;
(xix)	the Loan Group; and
(xx)	whether the Mortgage Loan has a fixed interest rate or an adjustable interest rate.

 

The Mortgage Loan Schedule shall also set forth the total of the amounts described under (ix) above for all of the Mortgage Loans.

Mortgage Note: The note or other evidence of the indebtedness of a Mortgagor under a Mortgage Loan.

Mortgage Rate: With respect to any Mortgage Loan, the annual rate at which interest accrues on such Mortgage Loan.

Mortgaged Property: The underlying property, including real property and improvements thereon, securing a Mortgage Loan.

Mortgagor: The obligor or obligors under a Mortgage Note.

Net Liquidation Proceeds: With respect to any Liquidated Mortgage Loan, Liquidation Proceeds and Subsequent Recoveries net of unreimbursed Servicing Advances by the Servicer, Monthly Advances and Liquidation Expenses.

Net Monthly Excess Cashflow: With respect to Loan Group I, Loan Group II and Loan Group III, as determined in the aggregate for any Payment Date, the sum of (1) the excess of (x) the sum of the Group I, Group II and Group III Available Funds for such Payment Date over (y) the sum for such Payment Date of (A) the aggregate amount of Accrued Note Interest for the Class I-A, Class II-A, Class III-A and Class M Notes and (B) the Principal Remittance Amount used to make payments in respect of principal to these Notes.

Net Mortgage Rate: For any Mortgage Loan, the then applicable Mortgage Rate thereon less the sum of the Master Servicing Fee and Servicing Fee, expressed as a per annum rate.

Net WAC Shortfall: With respect to the Class II-A-2, Class II-A-3 and Class II-A-4 Notes, on or prior to the related Note Rate Change Date, and with respect to the Class III-A-1, Class III-A-3 and Class III-A-4 Notes on any Payment Date, as determined separately for each such Class of Notes, the excess, if any, of (x) the related Accrued Note Interest thereon for such Payment Date calculated pursuant to clause (i)(a) of the related definition of Note Interest Rate over (y) Accrued Note Interest thereon for such Payment Date calculated at the related Available Funds Rate.

Net WAC Shortfall Carry-Forward Amount: With respect to the Class II-A-2, Class II-A-3 and Class II-A-4 Notes, on or prior to the related Note Rate Change Date, and with respect to the Class III-A-1, Class III-A-3 and Class III-A-4 Notes on any Payment Date, as determined separately for each such Class of Notes, an amount equal to the aggregate amount of Net WAC

 

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Shortfall for such Notes on such Payment Date, plus any unpaid Net WAC Shortfall for such Class of Notes from prior Payment Dates, plus interest thereon at the related Note Interest Rate for such Payment Date for such Class for the related Accrual Period, to the extent previously unreimbursed by Net Monthly Excess Cashflow.

Net Worth: With respect to any Person at any date, the excess of total assets over total liabilities of such Person, and its consolidated subsidiaries, on such date, each to be determined in accordance with generally accepted accounting principles (GAAP) as in effect in the United States from time to time.

Non-Offered Notes: The Class M-5, Class M-6 and Class B Notes.

Nonrecoverable Advance: Any Monthly Advance or any Servicing Advance (i) which was previously made or is proposed to be made by the Servicer or Master Servicer, as applicable; and (ii) which, in the good faith judgment of the Servicer or Master Servicer, will not or, in the case of a proposed advance, would not, be ultimately recoverable by the Servicer or Master Servicer, as applicable, from Liquidation Proceeds or future payments on any Mortgage Loan. The Indenture Trustee may conclusively rely on any determination of nonrecoverability made by the Servicer or Master Servicer, as applicable.

Note: A Class A, Class M or Class B Note.

Note Interest Rate: With respect to each Payment Date and the Class I-A, Class II-A-1, Class III-A-2, Class M-1, Class M-2, Class M-3 or Class M-4 Notes, a floating rate equal to the least of (i) One-Month LIBOR plus the related Note Margin, (ii) the related Maximum Note Interest Rate and (iii) the related Available Funds Rate with respect to such Payment Date. With respect to each Payment Date and the Class II-A-2, Class II-A-3 and Class II-A-4 Notes, (i) prior to the related Note Rate Change Date, the lesser of (a) 5.000%, 4.985% and 4.848% per annum, respectively and (b) the related Available Funds Rate and (ii) on or after the related Note Rate Change Date, the least of (a) Six-Month LIBOR plus the related Note Margin, (b) the related Maximum Note Interest Rate and (c) the related Available Funds Rate. With respect to each Payment Date prior to the Step-Up Date and the Class III-A-1, Class III-A-3 and Class III-A-4 Notes, the lesser of (i) 5.120%, 4.967% and 5.510% per annum, respectively, and (ii) the related Available Funds Rate. With respect to each Payment Date on or after the Step-Up Date and the Class III-A-1, Class III-A-3 and Class III-A-4 Notes, the lesser of (i) 5.620%, 5.467% and 6.010% per annum, respectively, and (ii) the related Available Funds Rate. With respect to each Payment Date and the Class M-5 Notes and Class M-6 Notes, 5.959% and 6.056% per annum, respectively.

Note Margin: The Class I-A-1, Class I-A-2, Class II-A-1, Class III-A-2, Class M-1, Class M-2, Class M-3 and Class M-4 Notes shall have the following Note Margins:

Class	Note Margin for any Payment Date prior to the Step-Up Date	Note Margin for any Payment Date on and after the Step-Up Date
I-A-1	0.260%	0.520%
I-A-2	0.360%	0.720%

 

 

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II-A-1	0.180%	0.360%
III-A-2	0.180%	0.360%
M-1	0.470%	0.705%
M-2	0.530%	0.795%
M-3	0.680%	1.020%
M-4	0.740%	1.110%

 

With respect to each of the Class II-A-2, Class II-A-3 and Class II-A-4 Notes after the applicable Note Rate Change Date, 1.625%.

Note Owner: The Beneficial Owner of a Note.

Note Principal Balance: With respect to any Note, as of any date of determination, the initial Note Principal Balance as stated on the face thereof, minus all amounts distributed in respect of principal with respect to such Note and (a) plus, in the case of the Class I-A-2, Class M and Class B, any Subsequent Recoveries allocated thereto and (b) minus, in the case of the Class I-A-2, Class M and Class B Notes, the aggregate amount of any reductions in the Note Principal Balance thereof deemed to have occurred in connection with allocations of Realized Losses on all prior Payment Dates in accordance with Section 3.38 of the Indenture.

Note Rate Change Date: With respect to the Class II-A-2, Class II-A-3 and Class II-A-4 Notes, the Payment Date in August 2010.

Note Register: The register maintained by the Note Registrar in which the Note Registrar shall provide for the registration of Notes and of transfers and exchanges of Notes.

Note Registrar: The Indenture Trustee, in its capacity as Note Registrar, or any successor to the Indenture Trustee in such capacity.

Noteholder or Holder: The Person in whose name a Note is registered in the Note Register, except that, any Note registered in the name of the Depositor, the Issuer, American Home Mortgage Investment Corp., the Indenture Trustee, the Securities Administrator, the Seller, the Servicer or the Master Servicer or any Affiliate of any of them shall be deemed not to be a holder or holders, nor shall any so owned be considered outstanding, for purposes of giving any request, demand, authorization, direction, notice, consent or waiver under the Indenture or the Trust Agreement; provided that, in determining whether the Securities Administrator and the Indenture Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Notes that a Responsible Officer of the Securities Administrator, the Indenture Trustee or the Owner Trustee actually knows to be so owned shall be so disregarded. Owners of Notes that have been pledged in good faith may be regarded as Holders if the pledgee establishes to the satisfaction of the Securities Administrator, the Indenture Trustee or the Owner Trustee the pledgee’s right so to act with respect to such Notes

 

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and that the pledgee is not the Issuer, any other obligor upon the Notes or any Affiliate of any of the foregoing Persons.

Offered Notes: The Class A, Class M-1, Class M-2, Class M-3 and Class M-4 Notes.

Officer’s Certificate: With respect to the Servicer or the Master Servicer, as applicable, a certificate signed by the President, Managing Director, a Director, a Vice President or an Assistant Vice President, of the Servicer or the Master Servicer, as applicable, and delivered to the Indenture Trustee or Master Servicer, as applicable. With respect to the Issuer, a certificate signed by any Authorized Officer of the Issuer, under the circumstances described in, and otherwise complying with, the applicable requirements of Section 10.01 of the Indenture, and delivered to the Securities Administrator. Unless otherwise specified, any reference in the Indenture to an Officer’s Certificate shall be to an Officer’s Certificate of any Authorized Officer of the Issuer.

One-Month LIBOR: With respect to any Accrual Period, the rate determined by the Securities Administrator on the related Interest Determination Date on the basis of the London interbank offered rate for one-month United States dollar deposits, as such rates appear on the Telerate Screen Page 3750, as of 11:00 a.m. (London time) on such Interest Determination Date.

In the event that on any Interest Determination Date, Telerate Screen Page 3750 fails to indicate the London interbank offered rate for one-month United States dollar deposits, then One-Month LIBOR for the related Accrual Period will be established by the Securities Administrator as follows:

(i)           If on such Interest Determination Date two or more Reference Banks provide such offered quotations, One-Month LIBOR for the related Accrual Period shall be the arithmetic mean of such offered quotations (rounded upwards if necessary to the nearest whole multiple of 1/16%).

(ii)          If on such Interest Determination Date fewer than two Reference Banks provide such offered quotations, One-Month LIBOR for the related Accrual Period shall be the higher of (i) One-Month LIBOR as determined on the previous Interest Determination Date and (ii) the Reserve Interest Rate.

(iii)        If no such quotations can be obtained and no Reference Bank rate is available, One-Month LIBOR will be the One-Month LIBOR rate applicable to the preceding Accrual Period.

The establishment of One-Month LIBOR on each Interest Determination Date by the Securities Administrator and the Securities Administrator’s calculation of the applicable Note Interest Rate applicable for the related Accrual Period shall (in the absence of manifest error) be final and binding.

Opinion of Counsel: A written opinion of counsel acceptable to the Indenture Trustee or the Master Servicer, as applicable, in its reasonable discretion which counsel may be in-house

 

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counsel for the Servicer or Master Servicer, as applicable, if acceptable to the Indenture Trustee, the Master Servicer and the Rating Agencies or counsel for the Depositor, as the case may be.

Original Value: Except in the case of a refinanced Mortgage Loan, the lesser of the Appraised Value or sales price of Mortgaged Property at the time a Mortgage Loan is closed, and for a refinanced Mortgage Loan, the Original Value is the value of such property set forth in an appraisal acceptable to the Servicer or the Master Servicer, as applicable.

Other Basis Risk Amount: With respect to any Payment Date, an amount equal to the sum of (i) the aggregate Basis Risk Shortfall Carry-Forward Amount or Net WAC Shortfall Carry-Forward Amount, as applicable, with respect to the Class II-A-2, Class II-A-3, Class II-A-4, Class II-A-1, Class III-A-3 and Class III-A-4 Notes for such Payment Date and (ii) the aggregate Excess Basis Risk Shortfall Carry-Forward Amount with respect to the Class I-A, Class II-A-1, Class III-A-2, Class M-1, Class M-2, Class M-3 and Class M-4 Notes for such Payment Date.

Outstanding: With respect to the Notes, as of the date of determination, all Notes theretofore executed, authenticated and delivered under this Indenture except:

(i)           Notes theretofore canceled by the Note Registrar or delivered to the Indenture Trustee for cancellation; and

(ii)          Notes in exchange for or in lieu of which other Notes have been executed, authenticated and delivered pursuant to the Indenture unless proof satisfactory to the Indenture Trustee is presented that any such Notes are held by a holder in due course.

Outstanding Mortgage Loan: As to any Due Date, a Mortgage Loan (including an REO Property) which was not the subject of a Principal Prepayment in Full, Cash Liquidation or REO Disposition and which was not purchased, deleted or substituted for prior to such Due Date pursuant to the Servicing Agreement or Mortgage Loan Purchase Agreement, as applicable.

Overcollateralization Increase Amount: With respect to any Payment Date, the excess, if any, of (a) the related Overcollateralization Target Amount over (b) the related Overcollateralized Amount on such Payment Date (after taking into account payments to the Notes of the Basic Principal Distribution Amount on such Payment Date).

Overcollateralization Target Amount: 0.35% of the Cut-off Date Balance.

Overcollateralized Amount: For any Payment Date, the amount, if any, by which (i) the aggregate Stated Principal Balance of the related mortgage loans (after giving effect to scheduled payments of principal due during the related Due Period, to the extent received or advanced, and unscheduled collections of principal received during the related Prepayment Period, including Realized Losses on the Mortgage Loans incurred during the related Prepayment Period), exceeds (ii) of the aggregate Note Principal Balance of the Notes as of such Payment Date (assuming that 100% of the Principal Remittance Amount is applied as a principal payment on these Notes on such Payment Date).

 

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Owner Trust Estate: The corpus of the Issuer created by the Trust Agreement which consists of items referred to in Section 3.01 of the Trust Agreement.

Owner Trustee: Wilmington Trust Company and its successors and assigns or any successor owner trustee appointed pursuant to the terms of the Trust Agreement.

Owner Trustee’s Fee: A fee of $2,500 per annum payable to the Owner Trustee in advance on the Closing Date and a fee of $4,000 payable on each anniversary thereof by American Home Mortgage Servicing, Inc.; provided, however, that in the event of any removal or resignation of the Owner Trustee, the Owner Trustee will promptly remit to American Home Mortgage Servicing, Inc. the portion of the Owner Trustee Fee that would have been earned by the Owner Trustee during the remainder of such year had it not been removed or resigned or the Notes redeemed.

Paying Agent: Any paying agent or co-paying agent appointed pursuant to Section 3.03 of the Indenture, which initially shall be the Indenture Trustee.

Payment Account: The account established by the Indenture Trustee pursuant to Section 3.01 of the Indenture. The Payment Account shall be an Eligible Account.

Payment Date: The 25th day of each month, or if such day is not a Business Day, then the next Business Day, commencing in October 2005.

Percentage Interest: With respect to any Note, the percentage obtained by dividing the Note Principal Balance of such Note by the aggregate Note Principal Balances of all Notes of that Class. With respect to any Certificate, the percentage as stated on the face thereof.

Periodic Rate Cap: With respect to any ARM Loan, the maximum rate, if any, by which the Mortgage Rate on such Mortgage Loan can adjust on any Adjustment Date, as stated in the related Mortgage Note or Mortgage.

Person: Any individual, corporation, partnership, limited liability company, joint venture, association, joint-stock company, trust, unincorporated organization or government or any agency or political subdivision thereof.

Plan: Any employee benefit plan or certain other retirement plans and arrangements, including individual retirement accounts and annuities, Keogh plans and bank collective investment funds and insurance company general or separate accounts in which such plans, accounts or arrangements are invested, that are subject to ERISA or Section 4975 of the Code.

Plan Assets: Assets of a Plan within the meaning of Department of Labor regulation 29 C.F.R. § 2510.3-101.

Pool Balance: With respect to any date of determination, the aggregate of the Stated Principal Balances of all Mortgage Loans as of such date.

 

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Prepayment Assumption: With respect to the Group III Loans, a 100% Prepayment Assumption assumes an 8.00% CPR for the first month in the life of such Mortgage Loan, an additional approximate 1.45% CPR for each month for the next 11 months, and 24% CPR with respect to the twelfth month in the life of such Mortgage Loan and each month thereafter.

Prepayment Interest Shortfall: As to any Payment Date and any Mortgage Loan (other than a Mortgage Loan relating to an REO Property) that was the subject of (a) a Principal Prepayment in Full during the related Prepayment Period, an amount equal to the excess of interest accrued during the related Prepayment Period at the Net Mortgage Rate on the Stated Principal Balance of such Mortgage Loan over the sum of the amount of interest paid by the Mortgagor for such Prepayment Period to the date of such Principal Prepayment in Full or (b) a partial Principal Prepayment during the related Prepayment Period, an amount equal to the interest at the Mortgage Rate (less the Servicing Fee Rate) during the related Prepayment Period on the amount of such partial Principal Prepayment.

Prepayment Period: With respect to each Mortgage Loan and any Payment Date, the calendar month immediately preceding the month in which such Payment Date occurs.

Primary Insurance Policy: Each primary policy of mortgage guaranty insurance issued by a Qualified Insurer or any replacement policy therefor.

Principal Distribution Amount: For any Payment Date, the sum of (a) the Basic Principal Distribution Amount, and (b) the Overcollateralization Increase Amount. In addition, the Principal Distribution Amount shall be reduced to the extent the Overcollateralized Amount for these Loan Groups exceeds the related Overcollateralization Target Amount, by the amount of such excess.

Principal Prepayment: Any payment or other recovery of principal on a Mortgage Loan which is received in advance of its scheduled Due Date to the extent that it is not accompanied by an amount as to interest representing scheduled interest due on any date or dates in any month or months subsequent to the month of prepayment, including Insurance Proceeds and Repurchase Proceeds, but excluding the principal portion of Net Liquidation Proceeds received at the time a Mortgage Loan becomes a Liquidated Mortgage Loan.

Principal Remittance Amount: For any Payment Date and each Loan Group, or the Mortgage Loans in the aggregate, as applicable, the sum of

1.	the principal portion of all scheduled monthly payments on the related Mortgage Loans due on the related Due Date, to the extent received or advanced;
2.	the principal portion of all proceeds of the repurchase of a Mortgage Loan in the related Loan Group (or, in the case of a substitution, certain amounts representing a principal adjustment) as required by the Mortgage Loan Purchase Agreement during the preceding calendar month; and

 

 

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3.

the principal portion of all other unscheduled collections received during the preceding calendar month in respect of the related Mortgage Loans, including full and partial prepayments, the proceeds of any repurchase of such Mortgage Loans by the Seller or holder of the Trust Certificates, Liquidation Proceeds and Insurance Proceeds, in each case to the extent applied as recoveries of principal.

Principal Prepayment in Full: Any Principal Prepayment made by a Mortgagor of the entire principal balance of a Mortgage Loan.

Proceeding: Any suit in equity, action at law or other judicial or administrative proceeding.

Prospectus: The Prospectus Supplement, dated September 19, 2005, together with the attached Prospectus, dated September 19, 2005.

Protected Account: An account established and maintained for the benefit of Noteholders by the Servicer with respect to the related Mortgage Loans and with respect to REO Property pursuant to the Servicing Agreement.

Purchase Price: The meaning specified in Section 2.2(a) of the Mortgage Loan Purchase Agreement.

Purchaser: American Home Mortgage Securities LLC, a Delaware limited liability company, and its successors and assigns.

Qualified Insurer: A mortgage guaranty insurance company duly qualified as such under the laws of the state of its principal place of business and each state having jurisdiction over such insurer in connection with the insurance policy issued by such insurer, duly authorized and licensed in such states to transact a mortgage guaranty insurance business in such states and to write the insurance provided by the insurance policy issued by it, approved as an insurer by the Servicer or the Master Servicer, as applicable, and as a Fannie Mae-approved mortgage insurer.

Rating Agency: Any nationally recognized statistical rating organization, or its successor, that rated the Notes at the request of the Depositor at the time of the initial issuance of the Notes. Initially, Standard & Poor’s and Moody’s. References herein to the highest short term unsecured rating category of a Rating Agency shall mean A-1 or better in the case of Standard & Poor’s and P-1 or better in the case of Moody’s and in the case of any other Rating Agency shall mean such equivalent ratings. References herein to the highest long-term rating category of a Rating Agency shall mean “AAA” in the case of Standard & Poor’s and “Aaa” in the case of Moody’s and in the case of any other Rating Agency, such equivalent rating.

Realized Loss: With respect to a Mortgage Loan, and as reported by the Servicer or to the Master Servicer, is (i) a Deficient Valuation, or (ii) as to any Liquidated Mortgage Loan, the unpaid principal balance thereof plus accrued and unpaid interest thereon at the Mortgage Rate through the last day of the month of liquidation less the Net Liquidation Proceeds with respect to such Mortgage Loan and the related Mortgaged Property.

 

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Record Date: For each class of Notes, other than the Class II-A-2, Class II-A-3, Class II-A-4, Class III-A-1, Class III-A-3, Class III-A-4, Class M-5 and Class M-6 Notes, and each Payment Date, will be the close of business on the Business Day immediately preceding such Payment Date; provided, however, if any such Note is no longer a Book-Entry Note, the “Record Date” for such class of Notes shall be the close of business on the last Business Day of the calendar month preceding such Payment Date. For each class of the Class II-A-2, Class II-A-3, Class II-A-4, Class III-A-1, Class III-A-3, Class III-A-4, Class M-5 and Class M-6 Notes and each Payment Date, the close of business on the last Business Day of the calendar month preceding such Payment Date.

Reference Banks: Any leading banks selected by the Securities Administrator and engaged in transactions in Eurodollar deposits in the international Eurocurrency market (i) with an established place of business in London, (ii) whose quotations appear on the Telerate Screen Page 3750 on the Interest Determination Date in question, (iii) which have been designated as such by the Securities Administrator, and (iv) which are not Affiliates of the Depositor, the Seller, the Master Servicer or the Servicer.

Registered Holder: The Person in whose name a Note is registered in the Note Register on the applicable Record Date.

Related Documents: With respect to each Mortgage Loan, the documents specified in Section 2.1(b) of the Mortgage Loan Purchase Agreement, and any documents required to be added to such documents pursuant to the Mortgage Loan Purchase Agreement, the Trust Agreement, Indenture or the Servicing Agreement.

Relief Act: The Servicemember’s Civil Relief Act.

Relief Act Shortfall: As to any Payment Date and any Mortgage Loan (other than a Mortgage Loan relating to an REO Property), any shortfalls relating to the Relief Act or similar legislation or regulations.

Remittance Report: The report prepared by the Servicer pursuant to Section 4.01 of the Servicing Agreement.

REO Acquisition: The acquisition by the Servicer, on behalf of the Issuer for the benefit of the Noteholders of any REO Property pursuant to Section 3.13 of the Servicing Agreement.

REO Disposition: As to any REO Property, a determination by the Servicer that it has received substantially all Insurance Proceeds, Liquidation Proceeds, REO Proceeds and other payments and recoveries (including proceeds of a final sale) which the Servicer expects to be finally recoverable from the sale or other disposition of the REO Property.

REO Imputed Interest: As to any REO Property, for any period, an amount equivalent to interest (at the Net Mortgage Rate that would have been applicable to the related Mortgage Loan had it been Outstanding) on the unpaid principal balance of the Mortgage Loan as of the date of acquisition thereof for such period as such balance is reduced pursuant to Section 3.13 of the Servicing Agreement by any income from the REO Property treated as a recovery of principal.

 

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REO Proceeds: Proceeds, net of expenses, received in respect of any REO Property (including, without limitation, proceeds from the rental of the related Mortgaged Property) which proceeds are required to be deposited into the Protected Account only upon the related REO Disposition.

REO Property: A Mortgaged Property that is acquired by the Trust by foreclosure or by deed in lieu of foreclosure.

Repurchase Price: With respect to any Mortgage Loan required to be repurchased by the Seller on any date pursuant to the Mortgage Loan Purchase Agreement or purchased by the Servicer pursuant to the Servicing Agreement an amount equal to the sum, without duplication, of (i) 100% of the Stated Principal Balance thereof (without reduction for any amounts charged off) and (ii) unpaid accrued interest at the Mortgage Rate on the outstanding principal balance thereof from the Due Date to which interest was last paid by the Mortgagor to the first day of the month following the month of purchase plus (iii) the amount of unreimbursed Monthly Advances or unreimbursed Servicing Advances made with respect to such Mortgage Loan plus (iv) any other amounts owed to the Master Servicer or the Servicer as applicable, pursuant to the Master Servicing Agreement or Servicing Agreement and not included in clause (iii) of this definition plus (v) any costs and damages incurred by the trust in connection with any violation by such loan of any predatory lending law.

Repurchase Proceeds: The Repurchase Price in connection with any repurchase of a Mortgage Loan by the Seller and any cash deposit in connection with the substitution of a Mortgage Loan.

Required Reserve Fund Balance: For any Payment Date will be an amount equal to three months’ interest on the Note Principal Balance of the Class N Notes immediately preceding such Payment Date, calculated based on the Note Interest Rate thereon and three Accrual Periods consisting of 30 days each.

Required Reserve Fund Deposit: For any Payment Date will be equal to the amount necessary to cause the amount on deposit in the Class N Reserve Fund to equal to the Required Reserve Fund Balance for such Payment Date.

Reserve Interest Rate: With respect to any Interest Determination Date, the rate per annum that the Securities Administrator determines to be either (i) the arithmetic mean (rounded upwards if necessary to the nearest whole multiple of 0.0625%) of the one-month, six-month or one-year (as applicable) United States dollar lending rates which New York City banks selected by the Securities Administrator are quoting on the relevant Interest Determination Date to the principal London offices of leading banks in the London interbank market or (ii) in the event that the Securities Administrator can determine no such arithmetic mean, the lowest one-month, six-month or one-year (as applicable) United States dollar lending rate which New York City banks selected by the Securities Administrator are quoting on such Interest Determination Date to leading European banks.

 

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Responsible Officer: With respect to the Indenture Trustee or the Securities Administrator, (a) any officer within the corporate trust department of the Indenture Trustee including any vice president, assistant vice president, treasurer, assistant treasurer, trust officer or any other officer of the Indenture Trustee who customarily performs functions similar to those performed by the persons who at the time shall be such officers, respectively, or to whom any corporate trust matter is referred because of such person’s knowledge of and familiarity with the particular subject and (b) who shall have direct responsibility for the administration of the applicable Agreement.

Retained Notes: The Class M-5, Class M-6 and Class B Notes.

Rolling Three Month Delinquency Rate: With respect to any Payment Date, the average of the Delinquency Rates for each of the three (or one and two, in the case of the first and second Payment Dates, respectively) immediately preceding months.

Sarbanes Oxley Certification: A written certification covering servicing of the Mortgage Loans by the Servicer and signed by an officer of the Depositor that complies with (i) the Sarbanes-Oxley Act of 2002, as amended from time to time, and (ii) the February 21, 2003 Statement by the Staff of the Division of Corporation Finance of the Securities and Exchange Commission Regarding Compliance by Asset-Backed Issuers with Exchange Act Rules 13a-14 and 15d-14, as in effect from time to time.

Securities Act: The Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

Securities Administrator: Wells Fargo Bank, N.A., a national banking association, and its successors and assigns.

Securities Administrator Collection Account: The account established by the Securities Administrator pursuant to Section 3.06 of the Master Servicing Agreement.

Securities Intermediary: Deutsche Bank National Trust Company, or its successors and assigns.

Security: Any of the Certificates or Notes.

Securityholder or Holder: Any Noteholder or a Certificateholder.

Security Instrument: A written instrument creating a valid first lien on a Mortgaged Property securing a Mortgage Note, which may be any applicable form of mortgage, deed of trust, deed to secure debt or security deed, including any riders or addenda thereto.

Seller: American Home Mortgage Acceptance, Inc., a Maryland corporation, and its successors and assigns.

Servicer: American Home Mortgage Servicing, Inc., a Maryland corporation, and its successors and assigns.

 

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Servicer Remittance Date: The third Business Day prior to the each Payment Date.

Servicing Account: The separate trust account created and maintained by the Servicer with respect to the Mortgage Loans or REO Property, which shall be an Eligible Account, for collection of taxes, assessments, insurance premiums and comparable items as described in Section 3.08 of the Servicing Agreement.

Servicing Advances: All customary, reasonable and necessary “out of pocket” costs and expenses incurred in connection with a default, delinquency or other unanticipated event in the performance by the Servicer or any Subservicer of its servicing obligations, including, without duplication, but not limited to, the cost of (i) the preservation, restoration and protection of a Mortgaged Property, (ii) any enforcement or judicial proceedings, including foreclosures and any expenses incurred in relation to any such proceedings that result from the Mortgage Loan being registered on the MERS® System, (iii) the management and liquidation of any REO Property, (iv) compliance with the obligations under Sections 3.10, 3.11, 3.13 of the Servicing Agreement, (v) covering any expenses incurred by or on behalf of the Servicer in connection with obtaining Insurance Proceeds and (vi) that is applied to the restoration or repair of the related Mortgaged Property.

Servicing Agreement: The Servicing Agreement dated as of September 20, 2005, among the Seller, Servicer, the Master Servicer, Issuer and Indenture Trustee.

Servicing Certificate: A certificate completed and executed by a Servicing Officer on behalf of the Servicer in accordance with Section 4.01 of the Servicing Agreement.

Servicing Default: The meaning assigned in Section 6.01 of the Servicing Agreement.

Servicing Fee: With respect to each Mortgage Loan and any Payment Date, the fee payable monthly to the Servicer in respect of servicing compensation that accrues at an annual rate equal to the Servicing Fee Rate multiplied by the Stated Principal Balance of such Mortgage Loan as of the first day of the related Due Period.

Servicing Fee Rate: With respect to any adjustable rate Mortgage Loan with an original principal balance of less than or equal to $359,650, 0.375% per annum, with respect to any adjustable rate Mortgage Loan with an original principal balance of greater than $359,650, 0.250% per annum, with respect to any fixed rate Mortgage Loan, 0.250% per annum.

Servicing Officer: Any officer of the Servicer or the Master Servicer, as applicable, involved in, or responsible for, the administration and servicing (or master servicing, as applicable) of the Mortgage Loans whose name and specimen signature appear on a list of servicing officers furnished to the Indenture Trustee or the Master Servicer, as applicable, by the Servicer or the Master Servicer, as applicable, on the Closing Date, as such list may be amended from time to time.

Servicing Rights Pledgee: One or more lenders, selected by the Servicer, to which the Servicer may pledge and assign all of its right, title and interest in, to and under the Servicing Agreement, including Bank of America, N.A., as the representative of certain lenders.

 

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Servicing Trigger Event: A Servicing Trigger Event is in effect with respect to any Payment Date if either:

(a)          the Rolling Three Month Delinquency Rate for the Mortgage Loans is greater than 6%; or

(b)          the cumulative amount of Realized Losses incurred on the Mortgage Loans from the Cut-off Date through the end of the calendar month immediately preceding such Payment Date exceeds the applicable percentage set forth below of the aggregate Cut-off Date Balance:

0.15% with respect to each month up to September 2006

0.15% with respect to October 2006, plus an additional 1/12th of 0.40% for each month thereafter until September 2007

0.55% with respect to October 2007, plus an additional 1/12th of 0.70% for each month thereafter until September 2008

1.25% with respect to October 2008, plus an additional 1/12th of 0.65% for each month thereafter until September 2009

1.90% with respect to October 2009, plus an additional 1/12th of 0.40% for each month thereafter until September 2010

2.50% with respect to October 2010, plus an additional 1/12th of 0.40% for each month thereafter until September 2011

2.90% with respect to October 2011 and each month thereafter

 

provided, however, that if the Servicer is rated “SQ2-” or better by Moody’s on any date, the Servicing Trigger Event will no longer be in effect with respect to any Payment Date thereafter.

Six-Month LIBOR: With respect to any Accrual Period, the rate determined by the Securities Administrator on the related Interest Determination Date on the basis of the London interbank offered rate for six-month United States dollar deposits, as such rates appear on the Telerate Screen Page 3750, as of 11:00 a.m. (London time) on such Interest Determination Date.

In the event that on any Interest Determination Date, Telerate Screen Page 3750 fails to indicate the London interbank offered rate for six-month United States dollar deposits, then Six-Month LIBOR for the related Accrual Period will be established by the Securities Administrator as follows:

(i)           If on such Interest Determination Date two or more Reference Banks provide such offered quotations, Six-Month LIBOR for the related Accrual Period shall be the arithmetic mean of such offered quotations (rounded upwards if necessary to the nearest whole multiple of 1/16%).

(ii)          If on such Interest Determination Date fewer than two Reference Banks provide such offered quotations, Six-Month LIBOR for the related Accrual Period shall be the higher of

 

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(i) Six-Month LIBOR as determined on the previous Interest Determination Date and (ii) the Reserve Interest Rate.

(iii)        If no such quotations can be obtained and no Reference Bank rate is available, Six-Month LIBOR will be the Six-Month LIBOR rate applicable to the preceding Accrual Period.

The establishment of Six-Month LIBOR on each Interest Determination Date by the Securities Administrator and the Securities Administrator’s calculation of the applicable Note Interest Rate applicable for the related Accrual Period shall (in the absence of manifest error) be final and binding.

Standard & Poor’s: Standard & Poor’s, a division of The McGraw-Hill Companies, Inc., or its successor in interest.

Stated Principal Balance: With respect to any Mortgage Loan or related REO Property as of any date of determination, (i) the principal balance of the Mortgage Loan outstanding as of the Cut-off Date, after application of all scheduled Monthly Payments due on or before such date, whether or not received, minus (ii) the sum of (a) the principal portion of the Monthly Payments due with respect to such Mortgage Loan or REO Property during each Due Period ending prior to the most recent Payment Date which were received or with respect to which an Monthly Advance was made, (b) all Principal Prepayments with respect to such Mortgage Loan or REO Property, and all Insurance Proceeds, Liquidation Proceeds and REO Proceeds to the extent applied by the Servicer as recoveries of principal in accordance with Section 3.13 of the Servicing Agreement, with respect to such Mortgage Loan or REO Property, which were distributed pursuant to Section 3.05 of the Indenture on any previous Payment Date, and (c) the principal portion of any Realized Loss with respect thereto allocated pursuant to Section 3.38 of the Indenture for any previous Payment Date; provided that the Stated Principal Balance of any Liquidated Mortgage Loan is zero.

Statutory Trust Statute: Chapter 38 of Title 12 of the Delaware Code, 12 Del. Code §§3801 et seq., as the same may be amended from time to time.

Stepdown Date: The later to occur of (x) the Payment Date occurring in October 2008 and (y) the first Payment Date for which the Credit Enhancement Percentage for the Class A Notes (calculated for this purposes only after taking into account distributions of principal on the Mortgage Loans, but prior to any payment of the Class A Principal Distribution Amount for these Notes then entitled to payments of principal on that Payment Date) is greater than or equal to approximately 13.10%.

Step-Up Date: The Payment Date occurring after the first Payment Date for which the aggregate Stated Principal Balance of the Mortgage Loans as of the end of the related Due Period has been reduced to 10% or less of the Cut-off Date Balance.

 

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Strike Rate: With respect to each Corridor Contract and each Payment Date, the fixed rate set forth in the related Corridor Contract used to determine payments to the Indenture Trustee.

Subservicing Account: An Eligible Account established or maintained by a Subservicer as provided for in Section 3.06(e) of the Servicing Agreement.

Subsequent Recoveries: Unexpected recoveries, net of reimbursable expenses, with respect to a Liquidated Mortgage Loan that resulted in a Realized Loss in a month prior to the receipt of such recoveries.

Substitution Adjustment Amount: With respect to any Eligible Substitute Mortgage Loan, the amount as defined in Section 2.03 of the Servicing Agreement.

Telerate Screen Page 3750: The display designated as page 3750 on the Telerate Service (or such other page as may replace page 3750 on that service for the purpose of displaying London interbank offered rates of major banks).

Transferor: The Holder of the Certificates as shown on the Certificate Register.

Treasury Regulations: Regulations, including proposed or temporary Regulations, promulgated under the Code. References herein to specific provisions of proposed or temporary regulations shall include analogous provisions of final Treasury Regulations or other successor Treasury Regulations.

Trigger Event: A Trigger Event is in effect with respect to any Payment Date on and after the related Stepdown Date if either

(a)	the Rolling Three Month Delinquency Rate for the Mortgage Loans as of the close of business on the last day of the preceding calendar month exceeds 41.2% of the aggregate Note Principal Balance of the Class M Notes and Class B Notes plus the Overcollateralized Amount, divided by the aggregate Stated Principal Balance of the Mortgage Loans; or
(b)	the cumulative amount of Realized Losses incurred on the Mortgage Loans from the Cut-off Date through the end of the calendar month immediately preceding such Payment Date exceeds the applicable percentage set forth below of the aggregate Stated Principal Balance of the Mortgage Loans as of the Cut-off Date Balance:

 

October 2008 to September 2009	0.75%
October 2009 to September 2010	1.15%
October 2010 to September 2011	1.25%
October 2011 and thereafter	1.50%

 

 

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Trust: The American Home Mortgage Investment Trust 2005-3 to be created pursuant to the Trust Agreement.

Trust Agreement: The Amended and Restated Trust Agreement dated as of September 20, 2005, among the Owner Trustee, the Depositor and Deutsche Bank National Trust Company, as Certificate Registrar and Certificate Paying Agent, relating to the Trust.

Trust Estate: The meaning specified in the Granting Clause of the Indenture.

Trust Indenture Act or TIA: The Trust Indenture Act of 1939, as amended from time to time, as in effect on any relevant date.

UCC: The Uniform Commercial Code, as amended from time to time, as in effect in any specified jurisdiction.

Underwriters: UBS Securities LLC, Credit Suisse First Boston LLC, Goldman, Sachs & Co., Lehman Brothers Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated or their successors.

Uninsured Cause: Any cause of damage to property subject to a Mortgage that the complete restoration of such property is not fully reimbursable by the hazard insurance policies.

Unpaid Interest Shortfall: For each Class of Notes and any Payment Date, such Notes’ pro rata share, based on the amount of Accrued Note Interest otherwise payable on such Note on such Payment Date, of (a) any Prepayment Interest Shortfalls, to the extent not covered by Compensating Interest, and (b) any Relief Act Shortfalls, in each case to the extent incurred with respect to the related Mortgage Loans.