Common use of Distribution Priorities Clause in Contracts

Distribution Priorities. Subject to section 18, “loss recoveries,” on each distribution day, the pool distribution amount will be first distributed to any Insurer to pay any insurance premium, and then to the outstanding classes in the following priority (and, if there are any insured classes, the insured payment and amounts withdrawn from the reserve fund will be applied to make payments to the insured class certificates as provided in “Insured classes” below): (1) To each senior class, first, its current interest allocation for that distribution day, and second its interest allocation carryforward from the preceding distribution day, except that an accrual class’s interest distributions may be redirected as described in “- Accrual and accrual directed classes” above. Distributions of current allocations among the senior classes will be in proportion to current interest allocations for, and distributions of interest allocation carryforwards will be in proportion to interest allocation carryforwards to, that distribution day. (a) To any ratio-stripped PO class, principal up to its principal allocation for that distribution day, and (b) to the senior target-rate classes, principal up to their aggregate principal allocation for that distribution day, to be distributed to the senior target-rate classes in the priorities described in “Allocations among the senior classes - Order of allocation among senior target-rate classes” above. (3) To each subordinated class, in order of seniority, first, interest up to its interest allocation for that distribution day, and second, principal up to its principal allocation for that distribution day, except that a subordinated class’s principal distribution may be used to reimburse a ratio-stripped PO class, as described in the following paragraph. (4) Principal distributed to the subordinated classes under the preceding paragraph will be used to reimburse a ratio-stripped PO class up to the amount of (a) any realized subordinated losses previously allocated to the ratio-stripped PO class, and (b) any reduction to the ratio-stripped PO class’s principal balance to reflect the excess of (i) the aggregate principal allocations to the ratio-stripped PO class over (ii) the aggregate principal distributions to the ratio-stripped classes, as described in “Adjustments to class balances” below, to the extent that such losses and reductions were not previously reimbursed under this paragraph (4) or “Loss recoveries” below. Such reimbursements will be taken from distributions to the subordinated classes in order of subordination. (5) To each class, in order of seniority, a reimbursement of any reduction to the classes’ principal balances to reflect the excess of (a) the aggregate principal allocations to the classes over (b) the aggregate principal distributions to the classes, as described in “Adjustments to class balances” below, to the extent such reductions were not previously reimbursed. Classes with equal seniority will share in the reimbursement in proportion to such unreimbursed reductions. (6) To the residual certificates, a residual distribution of the remaining pool distribution amount. A class that is no longer outstanding cannot receive a distribution. Notwithstanding anything to the contrary in this agreement, no distribution will be made to a subordinated class on a distribution day if on that distribution day the principal balance of a more senior class would be reduced by any part of the principal portion of a realized subordinated loss.

Distribution Priorities. Subject to section 18, “loss recoveries,” on each distribution day, the pool distribution amount will be first distributed to any Insurer to pay any insurance premium, and then to the outstanding classes in the following priority (and, if there are any insured classes, the insured payment and amounts withdrawn from the reserve fund will be applied to make payments to the insured class certificates as provided in “Insured classes” below): (1) To each senior class, first, its current interest allocation for that distribution day, and second its interest allocation carryforward from the preceding distribution day, except that an accrual class’s interest distributions may be redirected as described in “- – Accrual and accrual directed classes” above. Distributions of current allocations among the senior classes will be in proportion to current interest allocations for, and distributions of interest allocation carryforwards will be in proportion to interest allocation carryforwards to, that distribution day. (a) To any ratio-stripped PO class, principal up to its principal allocation for that distribution day, and (b) to the senior target-rate classes, principal up to their aggregate principal allocation for that distribution day, to be distributed to the senior target-rate classes in the priorities described in “Allocations among the senior classes - – Order of allocation among senior target-rate classes” above. (3) To each subordinated class, in order of seniority, first, interest up to its interest allocation for that distribution day, and second, principal up to its principal allocation for that distribution day, except that a subordinated class’s principal distribution may be used to reimburse a ratio-stripped PO class, as described in the following paragraph. (4) Principal distributed to the subordinated classes under the preceding paragraph will be used to reimburse a ratio-stripped PO class up to the amount of (a) any realized subordinated losses previously allocated to the ratio-stripped PO class, and (b) any reduction to the ratio-stripped PO class’s principal balance to reflect the excess of (i) the aggregate principal allocations to the ratio-stripped PO class over (ii) the aggregate principal distributions to the ratio-stripped classes, as described in “Adjustments to class balances” below, to the extent that such losses and reductions were not previously reimbursed under this paragraph (4) or “Loss recoveries” below. Such reimbursements will be taken from distributions to the subordinated classes in order of subordination. (5) To each class, in order of seniority, a reimbursement of any reduction to the classes’ principal balances to reflect the excess of (a) the aggregate principal allocations to the classes over (b) the aggregate principal distributions to the classes, as described in “Adjustments to class balances” below, to the extent such reductions were not previously reimbursed. Classes with equal seniority will share in the reimbursement in proportion to such unreimbursed reductions. (6) To the residual certificates, a residual distribution of the remaining pool distribution amount. A class that is no longer outstanding cannot receive a distribution. Notwithstanding anything to the contrary in this agreement, no distribution will be made to a subordinated class on a distribution day if on that distribution day the principal balance of a more senior class would be reduced by any part of the principal portion of a realized subordinated loss.

Distribution Priorities. Subject to section 18, “loss recoveries,” on each distribution day, the pool distribution amount will be first distributed to any Insurer to pay any insurance premium, and then to the outstanding classes in the following priority (and, if there are any insured classes, the insured payment and amounts withdrawn from the reserve fund will be applied to make payments to the insured class certificates as provided in “Insured classes” below): (1) To each senior class, first, its current interest allocation for that distribution day, and second its interest allocation carryforward from the preceding distribution day, except that an accrual class’s interest distributions may be redirected as described in “- – Accrual and accrual directed classes” above. Distributions of current allocations among the senior classes will be in proportion to current interest allocations for, and distributions of interest allocation carryforwards will be in proportion to interest allocation carryforwards to, that distribution day. (a) To any ratio-stripped PO class, principal up to its principal allocation for that distribution day, and (b) to the senior target-rate classes, principal up to their aggregate principal allocation for that distribution day, to be distributed to the senior target-rate classes in the priorities described in “Allocations among the senior classes - – Order of allocation among senior target-rate classes” above. (3) To each subordinated class, in order of seniority, first, interest up to its interest allocation for that distribution day, and second, principal up to its principal allocation for that distribution day, except that a subordinated class’s principal distribution may be used to reimburse a ratio-stripped PO class, as described in the following paragraph. (4) Principal distributed to the subordinated classes under the preceding paragraph will be used to reimburse a ratio-stripped PO class up to the amount of (a) any realized subordinated losses previously allocated to the ratio-stripped PO class, and (b) any reduction to the ratio-stripped PO class’s principal balance to reflect the excess of (i) the aggregate principal allocations to the ratio-stripped PO class over (ii) the aggregate principal distributions to the ratio-stripped classes, as described in “Adjustments to class balances” below, to the extent that such losses and reductions were not previously reimbursed under this paragraph (4) or “Loss recoveries” below. Such reimbursements will be taken from distributions to the subordinated classes in order of subordination. (5) To each class, in order of seniority, a reimbursement of any reduction to the classes’ principal balances to reflect the excess of (a) the aggregate principal allocations to the classes over (b) the aggregate principal distributions to the classes, as described in “Adjustments to class balances” below, to the extent such reductions were not previously reimbursed. Classes with equal seniority will share in the reimbursement in proportion to such unreimbursed reductions. (6) To the residual certificates, a residual distribution of the remaining pool distribution amount. A class that is no longer outstanding cannot receive a distribution. Notwithstanding anything to the contrary in this agreement, no distribution will be made to a subordinated class on a distribution day if on that distribution day the principal balance of a more senior class would be reduced by any part of the principal portion of a realized subordinated loss.and