OHS Draft
RESIDENTIAL ACCREDIT LOANS, INC.,
Company,
RESIDENTIAL FUNDING CORPORATION,
Master Servicer,
and
DEUTSCHE BANK TRUST COMPANY placecountry-regionAMERICAS,
Trustee
SERIES SUPPLEMENT,
Dated as of June 1, 2006,
TO
STANDARD TERMS OF
POOLING AND SERVICING AGREEMENT
dated as of March 1, 2006
Mortgage Asset-Backed Pass-Through Certificates
Series 2006-QA5
ARTICLE I DEFINITIONS................................................................................7
Section 1.01. Definitions.......................................................................7
Section 1.02. Determination of LIBOR...........................................................45
Section 1.03. Use of Words and Phrases.........................................................46
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; ORIGINAL ISSUANCE OF CERTIFICATES...........................46
Section 2.01. Conveyance of Mortgage Loans.....................................................46
Section 2.02. Acceptance by Trustee............................................................52
Section 2.03. Representations, Warranties and Covenants of the Master Servicer and the Company.52
Section 2.04. Representations and Warranties of Sellers........................................55
Section 2.05. Execution and Authentication of Certificates/Issuance of Certificates Evidencing
Interests in REMIC I Certificates................................................55
Section 2.06. Conveyance of REMIC I Regular Interests; Acceptance by the Trustee...............56
Section 2.07. Issuance of Certificates Evidencing Interest in REMIC II.........................56
Section 2.08. Purposes and Powers of the Trust.................................................56
Section 2.09. Agreement Regarding Ability to Disclose..........................................56
ARTICLE III ADMINISTRATION AND SERVICING OF MORTGAGE LOANS............................................57
ARTICLE IV PAYMENTS TO CERTIFICATEHOLDERS............................................................61
Section 4.01. Certificate Account..............................................................61
Section 4.02. Distributions....................................................................61
Section 4.03. Statements to Certificateholders; Statements to the Rating Agencies; Exchange
Act Reporting....................................................................67
Section 4.04. Distribution of Reports to the Trustee and the Company; Advances by the
Master Servicer..................................................................67
Section 4.05. Allocation of Realized Losses....................................................68
Section 4.06. Reports of Foreclosures and Abandonment of Mortgaged Property....................70
Section 4.07. Optional Purchase of Defaulted Mortgage Loans....................................70
Section 4.08. Surety Bond......................................................................70
Section 4.09. Swap Agreement...................................................................70
Section 4.10. Class P Reserve Account..........................................................70
ARTICLE V THE CERTIFICATES..........................................................................73
ARTICLE VI THE COMPANY AND THE MASTER SERVICER.......................................................78
ARTICLE VII DEFAULT...................................................................................79
ARTICLE VIII CONCERNING THE TRUSTEE....................................................................80
ARTICLE IX TERMINATION...............................................................................82
ARTICLE X REMIC PROVISIONS..........................................................................87
Section 10.01. REMIC Administration.............................................................87
Section 10.02. Master Servicer; REMIC Administrator and Trustee Indemnification.................87
Section 10.03. Designation of REMIC.............................................................87
Section 10.04. Distributions on the REMIC I Regular Interests...................................87
Section 10.05. Compliance with Withholding Requirements.........................................87
ARTICLE XI MISCELLANEOUS PROVISIONS..................................................................89
Section 11.01. Amendment........................................................................89
Section 11.02. Recordation of Agreement; Counterparts...........................................89
Section 11.03. Limitation on Rights of Certificateholders.......................................89
Section 11.04. Governing Laws...................................................................89
Section 11.05. Notices..........................................................................89
Section 11.06. Required Notices to Rating Agency and Subservicer................................90
Section 11.07. Severability of Provisions.......................................................90
Section 11.08. Supplemental Provisions for Resecuritization.....................................90
Section 11.09. Allocation of Voting Rights......................................................90
Section 11.10. No Petition......................................................................91
ARTICLE XII COMPLIANCE WITH REGULATION AB.............................................................92
EXHIBITS
Exhibit 1: Mortgage Loan Schedule
Exhibit 2: Information to be Included in Monthly Distribution Date Statement
Exhibit 3: Standard Terms of Pooling and Servicing Agreement, dated as of March 1, 2006
Exhibit 4: Swap Agreement
Exhibit 5: SB-AM Swap Agreement
Exhibit 6 Form of Class I-SB Certificate
Exhibit 7: Form of Class P Certificate
Exhibit 8 Form of ERISA Letter
This is a Series Supplement, dated as of June 1, 2006 (the “Series Supplement”), to the Standard Terms of Pooling and
Servicing Agreement, dated as of March 1, 2006 and attached as Exhibit 3 hereto (the “Standard Terms” and, together with this Series
Supplement, the “Pooling and Servicing Agreement” or “Agreement”), among RESIDENTIAL ACCREDIT LOANS, INC., as the company (together
with its permitted successors and assigns, the “Company”), RESIDENTIAL FUNDING CORPORATION, as master servicer (together with its
permitted successors and assigns, the “Master Servicer”), and DEUTSCHE BANK TRUST COMPANY AMERICAS, as Trustee (together with its
permitted successors and assigns, the “Trustee”).
PRELIMINARY STATEMENT:
The Company intends to sell mortgage asset-backed pass-through certificates (collectively, the “Certificates”), to be issued
hereunder in multiple classes, which in the aggregate will evidence the entire beneficial ownership interest in the Mortgage Loans.
The terms and provisions of the Standard Terms are hereby incorporated by reference herein as though set forth in full
herein. If any term or provision contained herein shall conflict with or be inconsistent with any provision contained in the
Standard Terms, the terms and provisions of this Series Supplement shall govern. All capitalized terms not otherwise defined herein
shall have the meanings set forth in the Standard Terms. The Pooling and Servicing Agreement shall be dated as of the date of this
Series Supplement.
REMIC I
As provided herein, the REMIC Administrator will make an election to treat the segregated pool of assets consisting of the
Mortgage Loans in Loan Group I and certain other related assets (exclusive of the Swap Account, the Swap Agreement, the SB-AM Swap
Agreement and the Class P Reserve Account,) subject to this Agreement as a real estate mortgage investment conduit (a “REMIC”) for
federal income tax purposes, and such segregated pool of assets will be designated as “REMIC I.” The Class I-R-I Certificates will
represent the sole Class of “residual interests” in REMIC I for purposes of the REMIC Provisions (as defined herein) under federal
income tax law. The following table irrevocably sets forth the designation, remittance rate (the “Uncertificated REMIC I
Pass-Through Rate”) and initial Uncertificated Principal Balance for each of the “regular interests” in REMIC I (the “REMIC I Regular
Interests”). The “latest possible maturity date” (determined solely for purposes of satisfying Treasury regulation
Section 1.860G-1(a)(4)(iii)) for each REMIC I Regular Interest shall be the Maturity Date. None of the REMIC I Regular Interests will
be certificated.
Uncertificated REMIC I Initial Uncertificated REMIC I Latest Possible
Designation Pass-Through Rate Principal Balance Maturity Date
I-1-A Variable(1) $14,905,900.300 July 25, 2036
I-2-A Variable(1) 14,180,339.000 July 25, 2036
I-3-A Variable(1) 13,489,963.550 July 25, 2036
I-4-A Variable(1) 12,833,192.550 July 25, 2036
I-5-A Variable(1) 12,208,509.600 July 25, 2036
I-6-A Variable(1) 11,614,109.650 July 25, 2036
I-7-A Variable(1) 11,048,643.550 July 25, 2036
I-8-A Variable(1) 10,510,703.000 July 25, 2036
I-9-A Variable(1) 9,998,948.500 July 25, 2036
I-10-A Variable(1) 9,512,105.450 July 25, 2036
I-11-A Variable(1) 9,048,961.500 July 25, 2036
I-12-A Variable(1) 8,608,363.300 July 25, 2036
I-13-A Variable(1) 8,189,213.300 July 25, 2036
I-14-A Variable(1) 7,790,467.850 July 25, 2036
I-15-A Variable(1) 7,411,133.750 July 25, 2036
I-16-A Variable(1) 7,050,266.100 July 25, 2036
I-17-A Variable(1) 6,756,648.950 July 25, 2036
I-18-A Variable(1) 6,377,907.150 July 25, 2036
I-19-A Variable(1) 6,067,341.800 July 25, 2036
I-20-A Variable(1) 5,771,895.800 July 25, 2036
I-21-A Variable(1) 5,490,833.150 July 25, 2036
I-22-A Variable(1) 5,223,453.750 July 25, 2036
I-23-A Variable(1) 4,969,091.600 July 25, 2036
I-24-A Variable(1) 4,727,113.100 July 25, 2036
I-25-A Variable(1) 4,496,915.500 July 25, 2036
I-26-A Variable(1) 4,277,925.250 July 25, 2036
I-27-A Variable(1) 4,069,596.950 July 25, 2036
I-28-A Variable(1) 3,871,411.500 July 25, 2036
I-29-A Variable(1) 3,682,875.250 July 25, 2036
I-30-A Variable(1) 3,503,518.500 July 25, 2036
I-31-A Variable(1) 3,400,618.000 July 25, 2036
I-32-A Variable(1) 3,235,516.100 July 25, 2036
I-33-A Variable(1) 3,009,717.050 July 25, 2036
I-34-A Variable(1) 4,690,043.400 July 25, 2036
I-35-A Variable(1) 6,193,377.450 July 25, 2036
I-36-A Variable(1) 3,038,216.900 July 25, 2036
I-37-A Variable(1) 195,295.400 July 25, 2036
I-38-A Variable(1) 2,078,554.500 July 25, 2036
I-39-A Variable(1) 1,993,128.650 July 25, 2036
I-40-A Variable(1) 1,880,218.600 July 25, 2036
I-41-A Variable(1) 1,788,640.850 July 25, 2036
I-42-A Variable(1) 1,701,522.400 July 25, 2036
I-43-A Variable(1) 1,618,646.100 July 25, 2036
I-44-A Variable(1) 1,539,805.500 July 25, 2036
I-45-A Variable(1) 1,464,804.000 July 25, 2036
I-46-A Variable(1) 1,393,454.800 July 25, 2036
I-47-A Variable(1) 1,359,771.550 July 25, 2036
I-48-A Variable(1) 1,259,325.650 July 25, 2036
I-49-A Variable(1) 1,206,689.450 July 25, 2036
I-50-A Variable(1) 1,178,383.150 July 25, 2036
I-51-A Variable(1) 1,081,808.800 July 25, 2036
I-52-A Variable(1) 1,091,599.300 July 25, 2036
I-53-A Variable(1) 975,942.950 July 25, 2036
I-54-A Variable(1) 1,081,195.950 July 25, 2036
I-55-A Variable(1) 940,970.950 July 25, 2036
I-56-A Variable(1) 852,841.150 July 25, 2036
I-57-A Variable(1) 1,160,574.350 July 25, 2036
I-58-A Variable(1) 4,115,832.850 July 25, 2036
I-59-A Variable(1) 9,396,079.000 July 25, 2036
I-60-A Variable(1) 433,076.000 July 25, 2036
I-1-B Variable(1) 14,905,900.300 July 25, 2036
I-2-B Variable(1) 14,180,339.000 July 25, 2036
I-3-B Variable(1) 13,489,963.550 July 25, 2036
I-4-B Variable(1) 12,833,192.550 July 25, 2036
I-5-B Variable(1) 12,208,509.600 July 25, 2036
I-6-B Variable(1) 11,614,109.650 July 25, 2036
I-7-B Variable(1) 11,048,643.550 July 25, 2036
I-8-B Variable(1) 10,510,703.000 July 25, 2036
I-9-B Variable(1) 9,998,948.500 July 25, 2036
I-10-B Variable(1) 9,512,105.450 July 25, 2036
I-11-B Variable(1) 9,048,961.500 July 25, 2036
I-12-B Variable(1) 8,608,363.300 July 25, 2036
I-13-B Variable(1) 8,189,213.300 July 25, 2036
I-14-B Variable(1) 7,790,467.850 July 25, 2036
I-15-B Variable(1) 7,411,133.750 July 25, 2036
I-16-B Variable(1) 7,050,266.100 July 25, 2036
I-17-B Variable(1) 6,756,648.950 July 25, 2036
I-18-B Variable(1) 6,377,907.150 July 25, 2036
I-19-B Variable(1) 6,067,341.800 July 25, 2036
I-20-B Variable(1) 5,771,895.800 July 25, 2036
I-21-B Variable(1) 5,490,833.150 July 25, 2036
I-22-B Variable(1) 5,223,453.750 July 25, 2036
I-23-B Variable(1) 4,969,091.600 July 25, 2036
I-24-B Variable(1) 4,727,113.100 July 25, 2036
I-25-B Variable(1) 4,496,915.500 July 25, 2036
I-26-B Variable(1) 4,277,925.250 July 25, 2036
I-27-B Variable(1) 4,069,596.950 July 25, 2036
I-28-B Variable(1) 3,871,411.500 July 25, 2036
I-29-B Variable(1) 3,682,875.250 July 25, 2036
I-30-B Variable(1) 3,503,518.500 July 25, 2036
I-31-B Variable(1) 3,400,618.000 July 25, 2036
I-32-B Variable(1) 3,235,516.100 July 25, 2036
I-33-B Variable(1) 3,009,717.050 July 25, 2036
I-34-B Variable(1) 4,690,043.400 July 25, 2036
I-35-B Variable(1) 6,193,377.450 July 25, 2036
I-36-B Variable(1) 3,038,216.900 July 25, 2036
I-37-B Variable(1) 195,295.400 July 25, 2036
I-38-B Variable(1) 2,078,554.500 July 25, 2036
I-39-B Variable(1) 1,993,128.650 July 25, 2036
I-40-B Variable(1) 1,880,218.600 July 25, 2036
I-41-B Variable(1) 1,788,640.850 July 25, 2036
I-42-B Variable(1) 1,701,522.400 July 25, 2036
I-43-B Variable(1) 1,618,646.100 July 25, 2036
I-44-B Variable(1) 1,539,805.500 July 25, 2036
I-45-B Variable(1) 1,464,804.000 July 25, 2036
I-46-B Variable(1) 1,393,454.800 July 25, 2036
I-47-B Variable(1) 1,359,771.550 July 25, 2036
I-48-B Variable(1) 1,259,325.650 July 25, 2036
I-49-B Variable(1) 1,206,689.450 July 25, 2036
I-50-B Variable(1) 1,178,383.150 July 25, 2036
I-51-B Variable(1) 1,081,808.800 July 25, 2036
I-52-B Variable(1) 1,091,599.300 July 25, 2036
I-53-B Variable(1) 975,942.950 July 25, 2036
I-54-B Variable(1) 1,081,195.950 July 25, 2036
I-55-B Variable(1) 940,970.950 July 25, 2036
I-56-B Variable(1) 852,841.150 July 25, 2036
I-57-B Variable(1) 1,160,574.350 July 25, 2036
I-58-B Variable(1) 4,115,832.850 July 25, 2036
I-59-B Variable(1) 9,396,079.000 July 25, 2036
I-60-B Variable(1) 433,076.000 July 25, 2036
A-I Variable(1) 6,122,358.680 July 25, 2036
_______________
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(1) Calculated as provided in the definition of Uncertificated REMIC I Pass-Through Rate.
REMIC II
As provided herein, the REMIC Administrator will make an election to treat the segregated pool of assets consisting of the
REMIC I Regular Interests as a REMIC for federal income tax purposes, and such segregated pool of assets will be designated as
“REMIC II.” The Class I-R-II Certificates will represent the sole Class of “residual interests” in REMIC II for purposes of the REMIC
Provisions (as defined herein) under federal income tax law. The following table irrevocably sets forth the designation, remittance
rate (the “Uncertificated REMIC II Pass-Through Rate”) and initial Uncertificated Principal Balance for each of the “regular
interests” in REMIC II (the “REMIC II Regular Interests”). The “latest possible maturity date” (determined solely for purposes of
satisfying Treasury regulation Section 1.860G-1(a)(4)(iii)) for each REMIC II Regular Interest shall be the Maturity Date. None of
the REMIC II Regular Interests will be certificated.
Uncertificated REMIC II Initial Uncertificated REMIC II Latest Possible
Designation Pass-Through Rate Principal Balance Maturity Date
LT1 Variable(1) 612,108,078.00 July 25, 2036
LT2 Variable(1) 22,161.00 July 25, 2036
LT3 Variable(1) 39,059.84 July 25, 2036
LT4 Variable(1) 39,059.84 July 25, 2036
LT-IO Variable(1) (2) July 25, 2036
____________
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(1) Calculated in accordance with the definition of “Uncertificated REMIC II Pass-Through Rate” herein.
(2) REMIC II Regular Interest LT-IO will not have an Uncertificated Principal Balance but will accrue interest on its
uncertificated notional amount calculated in accordance with the definition of “Uncertificated Notional Amount” herein.
REMIC III
As provided herein, the REMIC Administrator will elect to treat the segregated pool of assets consisting of the REMIC II
Regular Interests as a REMIC for federal income tax purposes, and such segregated pool of assets will be designated as REMIC III.
The Class I-R-III Certificates will represent the sole Class of “residual interests” in REMIC III for purposes of the REMIC
Provisions under federal income tax law. The following table irrevocably sets forth the designation, Pass-Through Rate, aggregate
Initial Certificate Principal Balance, Maturity Date, initial ratings and certain features for each Class of Certificates comprising
the interests representing “regular interests” in REMIC III (the “REMIC III Regular Interests”). The “latest possible maturity date”
(determined solely for purposes of satisfying Treasury Regulation Section 1.860G-1(a)(4)(iii)) for each of the REMIC III Regular
Interests shall be the Maturity Date.
Aggregate
Initial
Certificate
Pass-Throu Principal Maturity S&P/ Minimum
Designation Type Rate Balance Features Date Xxxxx’x Denominations
Senior/ Adjustable
Adjustable Rate
Class I-A-1 Regular(1) Rate(2)(3) $270,000,000.00 July 25, 2036 AAA / Aaa $100,000.00
Senior /Adjustable
Regular(1) Adjustable $272,000,000.00 Rate AAA / Aaa $100,000.00
Class I-A-2 Rate(2)(3) July 25, 2036
Senior/Adjustable
Regular(1) Adjustable $30,720,000.00 Rate AAA / Aaa $100,000.00
Class I-A-3 Rate(2)(3) July 25, 2036
Class I-M-1 Regular(1) Adjustable Mezzanine/Adjustable AA+ / Aa1 $100,000.00
Rate(2)(3) $10,102,000.00 Rate July 25, 2036
Class I-M-2 Regular(1) Adjustable Mezzanine/Adjustable AA+ / Aa2 $100,000.00
Rate(2)(3) $5,204,000.00 Rate July 25, 2036
Class I-M-3 Regular(1) Adjustable Mezzanine/Adjustable AA+ / Aa3 $100,000.00
Rate(2)(3) $3,979,000.00 Rate July 25, 2036
Class I-M-4 Regular(1) Adjustable Mezzanine/Adjustable AA / A1 $100,000.00
Rate(2)(3) $2,449,000.00 Rate July 25, 2036
Class I-M-5 Regular(1) Adjustable Mezzanine/Adjustable AA / A2 $100,000.00
Rate(2)(3) $2,143,000.00 Rate July 25, 2036
Class I-M-6 Regular(1) Adjustable Mezzanine/Adjustable AA / A3 $100,000.00
Rate(2)(3) $2,142,000.00 Rate July 25, 2036
Class I-M-7 Regular(1) Adjustable Mezzanine/Adjustable A+ / Baa1 $250,000.00
Rate(2)(3) $2,143,000.00 Rate July 25, 2036
Class I-M-8 Regular(1) Adjustable Mezzanine/Adjustable A+ / Baa2 $250,000.00
Rate(2)(3) $2,143,000.00 Rate July 25, 2036
Class I-M-9 Regular(1) Adjustable Mezzanine/Adjustable A / Baa3 $250,000.00
Rate(2)(3) $3,061,000.00 Rate July 25, 2036
Class I-SB (4) Regular (4) (4) $6,122,358.83 Subordinate N/R N/A
July 25, 2036
Class I-P (5) Regular (5) (5) $ 100.00 Prepayment Charge N/R (6)
July 25, 2036
IO Regular (7) (8) (9) Interest Only N/R N/R
(1) This Class of Certificates represents ownership of a REMIC III Regular Interest together with certain rights to payments to
be made from amounts received under the Swap Agreement which will be deemed made for federal income tax purposes outside of REMIC III
by the holder of the Class I-SB Certificates as the owner of the Swap Agreement and (ii) the obligation to pay the Class IO
Distribution Amount. Any amount distributed on this Class of Certificates on any Distribution Date in excess of the amount
distributable on the related REMIC III Regular Interest on such Distribution Date shall be treated for federal income tax purposes as
having been paid from the Swap Account and any amount distributable on such REMIC III Regular Interest on such Distribution Date in
excess of the amount distributable on such Class of Certificates on such Distribution Date shall be treated as having been paid to
the Swap Account, all pursuant to and as further provided in Section 4.09 hereof.
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(2) The REMIC III Regular Interests, ownership of which is represented by the Class I-A Certificates and Class I-M Certificates,
will accrue interest at a per annum rate equal to the lesser of (i) LIBOR plus the applicable Margin and (ii) the Net WAC Cap Rate.
(3) The Class I-A Certificates and Class I-M Certificates will also entitle their holders to receive certain payments from the
Holder of the Class I-SB Certificates from amounts to which REMIC III Regular Interest I-SB-IO is entitled and from amounts received
under the Swap Agreement, which will not be a part of their ownership of the REMIC III Regular Interests.
(4) The Class I-SB Certificates will accrue interest as described in the definition of Accrued Certificate Interest. The Class
I-SB Certificates will not accrue interest on their Certificate Principal Balance. The Class I-SB Certificates will be comprised of
two REMIC III Regular Interests, a principal only regular interest designated I-SB-PO and an interest only regular interest
designated I-SB-IO, which will be entitled to distributions as set forth herein. The rights of the Holder of the Class I-SB
Certificates to payments from the Swap Agreement shall be outside and apart from its rights under REMIC III Regular Interests I-SB-IO
and I-SB-PO.
(5) The holders of the Class I-P Certificates will be entitled to all Prepayment Charges received on Prepayment Charge Loans in
Loan Group I, and these amounts will not be available for distribution on the other certificates. The Class I-P Certificates will
not be entitled to interest on any amounts due.
(6) The Class I-P Certificates shall be issuable in minimum denominations of not less than a 20% Percentage Interest.
(7) REMIC III Regular Interest IO will be held as an asset of the Swap Account established by the Trustee and will be treated
for federal income tax purposes as owned by the holder of the Class I-SB Certificates. REMIC III Regular Interest IO will be
uncertificated.
(8) For federal income tax purposes, REMIC III Regular Interest IO will not have a Pass Through Rate, but will be entitled to
100% of the amounts distributed on REMIC II Regular Interest LT-IO.
(9) For federal income tax purposes, REMIC III Regular Interest IO will not have an Uncertificated Principal Balance, but will
have a notional amount equal to the Uncertificated Notional Amount of REMIC II Regular Interest LT-IO.
REMIC IV
As provided herein, the REMIC Administrator will make an election to treat the segregated pool of assets consisting of the
Mortgage Loans in Loan Group II and certain other related assets (exclusive of the Class P Reserve Account,) subject to this
Agreement as a REMIC for federal income tax purposes, and such segregated pool of assets will be designated as REMIC IV. The Class
II-R-I Certificates will represent the sole Class of “residual interests” in REMIC IV for purposes of the REMIC Provisions under
federal income tax law. The following table irrevocably sets forth the designation, Pass-Through Rate, aggregate Initial Certificate
Principal Balance, Maturity Date, initial ratings and certain features for each Class of Certificates comprising the interests
representing “regular interests” in REMIC IV (the “REMIC IV Regular Interests”) as well as the Class II-R-I Certificates. The
“latest possible maturity date” (determined solely for purposes of satisfying Treasury Regulation Section 1.860G-1(a)(4)(iii)) for
each of the REMIC IV Regular Interests shall be the Maturity Date.
Aggregate
Initial
Certificate
Pass-Throug Principal Maturity S&P/ Minimum
Designation Type Rate Balance Features Date Xxxxx’x Denominations
Variable Senior/Super
Rate(1) Senior/ Variable
Class II-A-1 Regular $78,009,000.00 Rate July 25, 2036 AAA/Aaa $100,000.00
Variable Senior /Senior
Regular Rate(1) $5,558,000.00 Support/ Variable AAA/Aa1 $100,000.00
Class II-A-2 Rate July 25, 2036
Class II-R-I Residual Variable $100.00 Senior/Residual/ AAA/Aaa (2)
Rate(1) Variable Rate July 25, 2036
Class II-M-1 Regular Variable $1,925,000.00 Mezzanine/ Variable AA/ Aa2 $100,000.00
Rate(1) Rate July 25, 2036
Class II-M-2 Regular Variable $1,880,000.00 Mezzanine/ Variable A/NA $100,000.00
Rate(1) Rate July 25, 2036
Class II-M-3 Regular Variable $626,000.00 Mezzanine/ Variable BBB/NA $100,000.00
Rate(1) Rate July 25, 2036
Class II-B-1 Regular Variable $672,000.00 Mezzanine/ Variable BB/NA $100,000.00
Rate(1) Rate July 25, 2036
Class II-B-2 Regular Variable $492,000.00 Mezzanine/ Variable B/NA $100,000.00
Rate(1) Rate July 25, 2036
Class II-B-3 Regular Variable $358,706.00 Mezzanine/ Variable NA/NA $100,000.00
Rate(1) Rate July 25, 2036
Class II-P Regular (3) $ 100.00 Prepayment Charge NA/NA (4)
July 25, 2036
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(1) The Class II-A-1, Class II-A-2, Class II-R-I, Class II-M-1, Class II-M-2, Class II-M-3, Class II-B-1, Class II-B-2 and Class
II-B-3 Certificates will accrue interest at a per annum rate equal to the Net WAC Cap Rate. The initial Pass-Through Rate for the
Class II-A-I, Class II-A-II, Class II-R-I, Class II-M-1, Class II-M-2, Class II-M-3, Class II-B-1, Class II-B-2 and Class II-B-3
Certificates will be equal to approximately 6.27284% per annum.
(2) Reserved
(3) The holders of the Class II-P Certificates will be entitled to all Prepayment Charges received on Prepayment Charge Loans in
Loan Group II, and these amounts will not be available for distribution on the other certificates. The Class II-P Certificates will
not be entitled to interest on any amounts due.
(4) The Class II-P Certificates shall be issuable in minimum denominations of not less than a 20% Percentage Interest.
Each Class of the Class R Certificates shall be issuable in minimum denominations of not less than a 20% Percentage
Interest; provided, however, that one Class R Certificate of each Class of Class R Ceriticates will be issuable to Residential
Funding as “tax matters person” pursuant to Section 10.01(c) and (e) in a minimum denomination representing a Percentage Interest of
not less than 0.01%.
The Mortgage Loans have an aggregate Cut-off Date Principal Balance equal to $701,729,165.83. The Mortgage Loans are hybrid
adjustable-rate mortgage loans having terms to maturity at origination or modification of generally not more than 30 years.
In consideration of the mutual agreements herein contained, the Company, the Master Servicer and the Trustee agree as
follows:
ARTICLE I
DEFINITIONS
Section 1.01. Definitions.
Whenever used in this Agreement, the following words and phrases, unless the context otherwise requires, shall have the
meanings specified in this Article.
Accrued Certificate Interest: With respect to each Distribution Date and each Class of Class I-A Certificates and Class I-M
Certificates, interest accrued during the related Interest Accrual Period on the Certificate Principal Balance thereof immediately
prior to such Distribution Date at the Pass-Through Rate for that Distribution Date.
The amount of Accrued Certificate Interest on each Class of Class I-A Certificates and Class I-M Certificates shall be
reduced by the amount of Prepayment Interest Shortfalls on the Group I Loans during the prior calendar month to the extent not
covered by Compensating Interest pursuant to Section 3.16, by Relief Act Shortfalls on the Group I Loans during the related Due
Period. All such reductions with respect to the Mortgage Loans will be allocated among the Class I-A Certificates and Class I-M
Certificates in proportion to the amount of Accrued Certificate Interest payable on such Certificates on such Distribution Date
absent such reductions.
Accrued Certificate Interest with respect to any Class of Class I-M Certificates for any Distribution Date shall further be
reduced by the interest portion of Realized Losses allocated to any Class of Class I-M Certificates pursuant to Section 4.05.
Accrued Certificate Interest with respect to the Class I-A Certificates and Class I-M Certificates shall accrue on the basis
of a 360-day year and the actual number of days in the related Interest Accrual Period.
With respect to each Distribution Date and the Class I-SB Certificates, interest accrued during the preceding Interest
Accrual Period at the Pass-Through Rate on the Notional Amount as specified in the definition of Pass-Through Rate, immediately prior
to such Distribution Date, reduced by any interest shortfalls with respect to the Group I Loans, including Prepayment Interest
Shortfalls to the extent not covered by Compensating Interest pursuant to Section 3.16 or by Excess Cash Flow pursuant to Sections
4.02(c)(I)(i)(C) and 4.02(c)(I)(i)(D). Accrued Certificate Interest on the Class I-SB Certificates shall accrue on the basis of a
360-day year and the actual number of days in the related Interest Accrual Period.
With respect to any Class of Class II-A, Class II-M and Class II-B Certificates and any Distribution Date, interest accrued
during the related Interest Accrual Period at the related Pass-Through Rate on the Certificate Principal Balance thereof immediately
prior to such Distribution Date. In each case Accrued Certificate Interest on any Class of Certificates will be reduced by the
amount of:
(i) Prepayment Interest Shortfalls on all Group II Loans (to the extent not offset by the Master Servicer with a payment
of Compensating Interest as provided in Section 4.01),
(ii) the interest portion (adjusted to the Net Mortgage Rate (or the Modified Net Mortgage Rate in the case of a Modified
Mortgage Loan)) of Realized Losses on Group II Loans (including Excess Special Hazard Losses, Excess Fraud Losses, Excess
Bankruptcy Losses and Extraordinary Losses) not allocated solely to one or more specific Classes of Certificates pursuant to
Section 4.05,
(iii) the interest portion of Advances that were (A) previously made with respect to a Group II Loan or REO Property on
Group II Loans, which remained unreimbursed following the Cash Liquidation or REO Disposition of such Group II Loan or REO
Property and (B) made with respect to delinquencies that were ultimately determined to be Excess Special Hazard Losses, Excess
Fraud Losses, Excess Bankruptcy Losses or Extraordinary Losses, and
(iv) any other interest shortfalls not covered by the subordination provided by the Class II-M Certificates and Class
II-B Certificates, including interest that is not collectible from the Mortgagor pursuant to the Servicemembers Civil Relief Act,
or similar legislation or regulations as in effect from time to time.
The Group II Senior Percentage of such reductions in the case of the Group II Loans will be allocated among the holders of
the Group II Certificates in proportion to the respective amounts of Accrued Certificate Interest that would have been payable from
the Group II Loans on that Distribution Date absent these reductions. The remainder of these reductions will be allocated among the
holders of the Class II-M Certificates and Class II-B Certificates in proportion to the respective amounts of Accrued Certificate
Interest that would have been payable on that Distribution Date absent these reductions. Accrued Certificate Interest on all other
classes of Group II Certificates is calculated on the basis of a 360-day year divided into twelve 30-day months.
Adjustment Date: With respect 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.
Affected Party: As defined in the Swap Agreement.
Assignment Agreement and Amendment of Security Instrument: With respect to a Sharia Mortgage Loan, the agreement between the
consumer and the co-owner pursuant to which all of the co-owner’s interest as a beneficiary under the related Sharia Mortgage Loan
Security Instrument and the co-owner’s interest in the related Mortgaged Property is conveyed to a subsequent owner, which may take
the form of an “Assignment Agreement” and an “Amendment of Security Instrument” or an “Assignment Agreement and Amendment of Security
Instrument”, as applicable.
Available Distribution Amount: As to any Distribution Date and each Loan Group as determined separately for each Loan
Group, an amount equal to (a) the sum of (i) the amount relating to the Mortgage Loans on deposit in the Custodial Account as of the
close of business on the immediately preceding Determination Date, including any Subsequent Recoveries, and amounts deposited in the
Custodial Account in connection with the substitution of Qualified Substitute Mortgage Loans, (ii) the amount of any Advance made on
the immediately preceding Certificate Account Deposit Date, (iii) any amount deposited in the Certificate Account on the related
Certificate Account Deposit Date pursuant to the second paragraph of Section 3.12(a), (iv) any amount deposited in the Certificate
Account pursuant to Section 4.07 or Section 9.01, (v) any amount that the Master Servicer is not permitted to withdraw from the
Custodial Account or the Certificate Account pursuant to Section 3.16(e), (vi) any amount received by the Trustee pursuant to the
Surety Bond in respect of such Distribution Date and (vii) the proceeds of any Pledged Assets received by the Master Servicer,
reduced by (b) the sum as of the close of business on the immediately preceding Determination Date of (v) any payments or collections
consisting of Prepayment Charges on the Mortgage Loans that were received during the related Prepayment Period; (w) aggregate
Foreclosure Profits, (x) the Amount Held for Future Distribution, (y) amounts permitted to be withdrawn by the Master Servicer from
the Custodial Account in respect of the Mortgage Loans pursuant to clauses (ii)-(x), inclusive, of Section 3.10(a), and (z) with
repect to Group I Certificates, any Net Swap Payments required to be made to the Swap Counterparty and Swap Termination Payments not
due to a Swap Counterparty Trigger Event for such Distribution Date.
Bankruptcy Amount: With respect to the Group II Certificates, as of any date of determination prior to the first
anniversary of the Cut-off Date, an amount equal to the excess, if any, of (A) $100,000 over (B) the aggregate amount of Bankruptcy
Losses allocated solely to one or more specific Classes of Group II Certificates in accordance with Section 4.05 of this Series
Supplement. As of any date of determination on or after the first anniversary of the Cut-off Date, an amount equal to the excess, if
any, of
(1) the lesser of (a) the Bankruptcy Amount calculated as of the close of business on the Business Day immediately preceding
the most recent anniversary of the Cut-off Date coinciding with or preceding such date of determination (or, if such date of
determination is an anniversary of the Cut-off Date, the Business Day immediately preceding such date of determination) (for
purposes of this definition, the “Relevant Anniversary”) and (b) the greater of
(A)(i) if the aggregate principal balance of the Non-Primary Residence Loans in Loan Group II as of the Relevant
Anniversary is less than 10% of the Stated Principal Balance of the Mortgage Loans in Loan Group II as of the Relevant
Anniversary, $0.00, or (ii) if the aggregate principal balance of the Non-Primary Residence Loans in Loan Group II as
of the Relevant Anniversary is equal to or greater than 10% of the Stated Principal Balance of the Mortgage Loans in
Loan Group II as of the Relevant Anniversary, the sum of (I) the aggregate principal balance of the Non-Primary
Residence Loans in Loan Group II with a Loan-to-Value Ratio of greater than 80.00% but less than or equal to 90.00%
(other than Additional Collateral Loans), times 0.25%, (II) the aggregate principal balance of the Non-Primary
Residence Loans in Loan Group II with a Loan-to-Value Ratio of greater than 90.00% but less than or equal to 95.00%
(other than Additional Collateral Loans), times 0.50%, and (III) the aggregate principal balance of the Non-Primary
Residence Loans in Loan Group II with a Loan-to-Value Ratio of greater than 95.00% (other than Additional Collateral
Loans) times 0.75%, in each case as of the Relevant Anniversary; and
(B) the greater of (i) 0.0006 times the aggregate principal balance of all the Mortgage Loans in Loan Group II
as of the Relevant Anniversary having a Loan-to-Value Ratio (other than Additional Collateral Loans) at origination
which exceeds 75% and (ii) $100,000,
over (2) the aggregate amount of Bankruptcy Losses allocated solely to one or more specific Classes of Group II
Certificates in accordance with Section 4.05 since the Relevant Anniversary.
The Bankruptcy Amount may be further reduced by the Master Servicer (including accelerating the manner in which such
coverage is reduced) provided that prior to any such reduction, the Master Servicer shall (i) obtain written confirmation from each
Rating Agency that such reduction shall not reduce the rating assigned to any Class of Group II Certificates by such Rating Agency
below the lower of the then-current rating or the rating assigned to such Certificates as of the Closing Date by such Rating Agency
and (ii) provide a copy of such written confirmation to the Trustee.
Basis Risk Shortfall: With respect to each Class of the Class I-A Certificates and Class I-M Certificates, and any
Distribution Date, the sum of (a) with respect to any Distribution Date on which the Net WAC Cap Rate is used to determine the
Pass-Through Rate of such Class, an amount equal to the excess of (x) Accrued Certificate Interest for such Class calculated at a per
annum rate equal to LIBOR plus the related Margin for such Distribution Date, over (y) Accrued Certificate Interest for such
Class calculated using the Net WAC Cap Rate, (b) any shortfalls for such Class calculated pursuant to clause (a) above remaining
unpaid from prior Distribution Dates, and (c) interest on the amount in clause (b) from the Distribution Date on which such amount
was incurred at a per annum rate equal to the related Pass-Through Rate.
Book-Entry Certificate: The Class I-A, Class II-A, Class I-M and Class II-M Certificates.
Capitalization Reimbursement Amount: With respect to any Distribution Date and each Loan Group as determined separately for
each Loan Group, the amount of Advances or Servicing Advances that were added to the Stated Principal Balance of the Mortgage Loans
in the related Loan Group during the preceding calendar month and reimbursed to the Master Servicer or Subservicer on or prior to
such Distribution Date pursuant to Section 3.10(a)(vii), plus the related Capitalization Reimbursement Shortfall Amount remaining
unreimbursed from any prior Distribution Date and reimbursed to the Master Servicer or Subservicer on or prior to such Distribution
Date.
Capitalization Reimbursement Shortfall Amount- With respect to any Distribution Date and each Loan Group as determined
separately for each Loan Group, the amount, if any, by which the amount of Advances or Servicing Advances that were added to the
Stated Principal Balance of the Mortgage Loans in the related Loan Group during the preceding calendar month exceeds the amount of
principal payments on the Mortgage Loans included in the related Available Distribution Amount for that Distribution Date.
Certificate: Any Class I-A, Class II-A, Class I-M, Class II-M, Class I-SB, Class II-B, Class I-P, Class II-P, Class I-R or
Class II-R-I Certificate.
Certificate Account: The separate account or accounts created and maintained pursuant to Section 4.01 of the Standard
Terms, which shall be entitled “DEUTSCHE BANK TRUST COMPANY AMERICAS, as trustee, in trust for the registered holders of Residential
Accredit Loans, Inc., Mortgage Asset-Backed Pass-Through Certificates, Series 2006-QA5” and which must be an Eligible Account.
Certificate Group-With respect to (i) Loan Group I, the Class I-A, Class I-M, Class I-P and Class I-R Certificates, and (ii)
Loan Group II, the Class II-A, Class II-M, Class II-B, Class II-P and Class II-R-I Certificates.
Certificate Policy: None.
Certificate Principal Balance: With respect to any Class I-A Certificate or Class I-M Certificate, on any date of
determination, an amount equal to (i) the Initial Certificate Principal Balance of such Certificate as specified on the face thereof
minus (ii) the sum of (x) the aggregate of all amounts previously distributed with respect to such Certificate (or any predecessor
Certificate) and applied to reduce the Certificate Principal Balance thereof pursuant to Section 4.02(c)(I) and (y) in the case of
any Class of Class I-M Certificates, the aggregate of all reductions in Certificate Principal Balance deemed to have occurred in
connection with Realized Losses which were previously allocated to such Certificate (or any predecessor Certificate) pursuant to
Section 4.05; provided, that with respect to any Distribution Date, the Certificate Principal Balance of the Class I-M Certificates
will be increased, in each case to the extent Realized Losses were previously allocated thereto and remain unreimbursed, in the
following order of priority: to the Class I-M-1, Class I-M-2, Class I-M-3, Class I-M-4, Class I-M-5, Class I-M-6, Class I-M-7, Class
I-M-8 and Class I-M-9 Certificates, in that order, but only to the extent of Subsequent Recoveries received in respect of the Group
I Loans during the preceding calendar month. With respect to each Class I-SB Certificate, on any date of determination, an amount
equal to the Percentage Interest evidenced by such Certificate, multiplied by an amount equal to (i) the excess, if any, of (A) the
then aggregate Stated Principal Balance of the Mortgage Loans over (B) the then aggregate Certificate Principal Balance of the Class
I-A, Class I-M, Class I-P and Class I-R Certificates then outstanding, which represents the sum of (i) the Initial Principal Balance
of the REMIC III Regular Interest I-SB-PO, as reduced by Realized Losses allocated thereto and payments deemed made thereon, and (ii)
accrued and unpaid interest on the REMIC III Regular Interest I-SB-IO, as reduced by Realized Losses allocated thereto. The Class
I-R Certificates will not have a Certificate Principal Balance.
With respect to any Group II Certificate (other than the Class II-P Certificates), on any date of determination, an amount
equal to (i) the Initial Certificate Principal Balance of such Certificate as specified on the face thereof, plus (ii) any
Subsequent Recoveries added to the Certificate Principal Balance of such Certificate pursuant to Section 4.02, minus the sum of (x)
the aggregate of all amounts previously distributed with respect to such Certificate (or any predecessor Certificate) and applied to
reduce the Certificate Principal Balance thereof pursuant to Section 4.02(c)(II) and (y) the aggregate of all reductions in
Certificate Principal Balance deemed to have occurred in connection with Realized Losses which were previously allocated to such
Certificate (or any predecessor Certificate) pursuant to Section 4.05; provided, that the Certificate Principal Balance of each
Certificate of the Class of Class II-M Certificates and Class II-B Certificates with the Lowest Priority at any given time shall be
further reduced by an amount equal to the Percentage Interest represented by such Certificate multiplied by the excess, if any, of
(A) the then aggregate Certificate Principal Balance of all Classes of Group II Certificates then outstanding over (B) the then
aggregate Stated Principal Balance of the Group II Loans.
Class I-A Certificate: Any one of the Class I-A-1, Class I-A-2 and Class I-A-3 Certificates executed by the Trustee and
authenticated by the Certificate Registrar substantially in the form annexed to the Standard Terms as Exhibit A, senior to the Class
I-M Certificates, Class I-SB Certificates and Class I-R Certificates with respect to distributions and the allocation of Realized
Losses as set forth in Section 4.05, and evidencing (i) an interest designated as a “regular interest” in REMIC III for purposes of
the REMIC Provisions, (ii) the right to receive payments under the Swap Agreement and SB-AM Swap Agreement and (iii) the right to
receive Basis Risk Shortfalls.
Class I-A Principal Distribution Amount: With respect to any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution Date, the Group I Principal Distribution Amount for
that Distribution Date or (ii) on or after the Stepdown Date if a Trigger Event is not in effect for that Distribution Date, the
lesser of:
(i) the Group I Principal Distribution Amount for that Distribution Date; and
(ii)the excess, if any, of (A) the aggregate Certificate Principal Balance of the Class I-A Certificates immediately prior to
that Distribution Date over (B) the lesser of (x) the product of (1) the applicable Group I Subordination Percentage and (2) the
aggregate Stated Principal Balance of the Group I Loans after giving effect to distributions to be made on that Distribution Date
and (y) the excess, if any, of the aggregate Stated Principal Balance of the Group I Loans after giving effect to distributions
to be made on that Distribution Date, over the Overcollateralization Floor.
Class I-A-1 Certificate: The Class I-A-1 Certificates, executed by the Trustee and authenticated by the Certificate
Registrar substantially in the form annexed to the Standard Terms as Exhibit A.
Class I-A-1 Margin: With respect to any Distribution Date prior to the second Distribution Date after the first possible
Optional Termination Date, 0.180% per annum, and on any Distribution Date on or after the second Distribution Date after the first
possible Optional Termination Date, 0.360% per annum.
Class I-A-2 Certificate: The Class I-A-2 Certificates, executed by the Trustee and authenticated by the Certificate
Registrar substantially in the form annexed to the Standard Terms as Exhibit A.
Class I-A-2 Margin: With respect to any Distribution Date prior to the second Distribution Date after the first possible
Optional Termination Date, 0.180% per annum, and on any Distribution Date on or after the second Distribution Date after the first
possible Optional Termination Date, 0.360% per annum.
Class I-A-3 Certificate: The Class I-A-3 Certificates, executed by the Trustee and authenticated by the Certificate
Registrar substantially in the form annexed to the Standard Terms as Exhibit A.
Class I-A-3 Margin: With respect to any Distribution Date prior to the second Distribution Date after the first possible
Optional Termination Date, 0.220% per annum, and on any Distribution Date on or after the second Distribution Date after the first
possible Optional Termination Date, 0.440% per annum.
Class I-A-P Certificates: None.
Class I-M Certificates: Collectively, the Class I-M-1, Class I-M-2, Class I-M-3, Class I-M-4, Class I-M-5, Class I-M-6,
Class I-M-7, Class I-M-8 and Class I-M-9 Certificates.
Class I-M-1 Certificate: Any one of the Class I-M-1 Certificates executed by the Trustee and authenticated by the
Certificate Registrar substantially in the form annexed to the Standard Terms as Exhibit B, senior to the Class I-M-2, Class I-M-3,
Class I-M-4, Class I-M-5, Class I-M-6, Class I-M-7, Class I-M-8, Class I-M-9, Class I-SB and Class I-R Certificates with respect to
distributions and the allocation of Realized Losses as set forth in Section 4.05, and evidencing (i) an interest designated as a
“regular interest” in REMIC III for purposes of the REMIC Provisions, (ii) the right to receive payments under the Swap Agreement and
SB-AM Swap Agreement and (iii) the right to receive Basis Risk Shortfalls.
Class I-M-1 Margin: With respect to any Distribution Date prior to the second Distribution Date after the first possible
Optional Termination Date, 0.300% per annum, and on any Distribution Date on or after the second Distribution Date after the first
possible Optional Termination Date, 0.450% per annum.
Class I-M-1 Principal Distribution Amount: With respect to any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution Date, the remaining Group I Principal Distribution
Amount for that Distribution Date after distribution of the Class I-A Principal Distribution Amount or (ii) on or after the Stepdown
Date if a Trigger Event is not in effect for that Distribution Date, the lesser of:
(i) the remaining Group I Principal Distribution Amount for that Distribution Date after distribution of the Class I-A
Principal Distribution Amount; and
(ii) the excess, if any, of (A) the sum of (1) the aggregate Certificate Principal Balance of the Class I-A Certificates
(after taking into account the payment of the Class I-A Principal Distribution Amount for that Distribution Date) and (2) the
Certificate Principal Balance of the Class I-M-1 Certificates immediately prior to that Distribution Date over (B) the lesser of
(x) the product of (1) the applicable Group I Subordination Percentage and (2) the aggregate Stated Principal Balance of the Group I
Loans after giving effect to distributions to be made on that Distribution Date and (y) the excess, if any, of the aggregate Stated
Principal Balance of the Group I Loans after giving effect to distributions to be made on that Distribution Date, over the
Overcollateralization Floor.
Class I-M-2 Certificate: Any one of the Class I-M-2 Certificates executed by the Trustee and authenticated by the
Certificate Registrar substantially in the form annexed to the Standard Terms as Exhibit B, senior to the Class I-M-3, Class I-M-4,
Class I-M-5, Class I-M-6, Class I-M-7, Class I-M-8, Class I-M-9, Class I-SB and Class I-R Certificates with respect to distributions
and the allocation of Realized Losses as set forth in Section 4.05, and evidencing (i) an interest designated as a “regular interest”
in REMIC III for purposes of the REMIC Provisions, (ii) the right to receive payments under the Swap Agreement and SB-AM Swap
Agreement and (iii) the right to receive Basis Risk Shortfalls.
Class I-M-2 Margin: With respect to any Distribution Date prior to the second Distribution Date after the first possible
Optional Termination Date, 0.330% per annum, and on any Distribution Date on or after the second Distribution Date after the first
possible Optional Termination Date, 0.495% per annum.
Class I-M-2 Principal Distribution Amount: With respect to any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution Date, the remaining Group I Principal Distribution
Amount for that Distribution Date after distribution of the Class I-A Principal Distribution Amount and Class I-M-1 Principal
Distribution Amount or (ii) on or after the Stepdown Date if a Trigger Event is not in effect for that Distribution Date, the lesser
of:
(i) the remaining Group I Principal Distribution Amount for that Distribution Date after distribution of the Class I-A
Principal Distribution Amount and the Class I-M-1 Principal Distribution Amount; and
(ii) the excess, if any, of (A) the sum of (1) the aggregate Certificate Principal Balance of the Class I-A Certificates
and Class I-M-1 Certificates (after taking into account the payment of the Class I-A Principal Distribution Amount and the Class
I-M-1 Principal Distribution Amount for that Distribution Date) and (2) the Certificate Principal Balance of the Class I-M-2
Certificates immediately prior to that Distribution Date over (B) the lesser of (x) the product of (1) the applicable Group I
Subordination Percentage and (2) the aggregate Stated Principal Balance of the Group I Loans after giving effect to distributions to
be made on that Distribution Date and (y) the excess, if any, of the aggregate Stated Principal Balance of the Group I Loans after
giving effect to distributions to be made on that Distribution Date, over the Overcollateralization Floor.
Class I-M-3 Certificate: Any one of the Class I-M-3 Certificates executed by the Trustee and authenticated by the
Certificate Registrar substantially in the form annexed hereto as Exhibit B, senior to the Class I-M-4, Class I-M-5, Class I-M-6,
Class I-M-7, Class I-M-8, Class I-M-9, Class I-SB Certificates and Class I-R Certificates with respect to distributions and the
allocation of Realized Losses as set forth in Section 4.05, and evidencing (i) an interest designated as a “regular interest” in
REMIC III for purposes of the REMIC Provisions, (ii) the right to receive payments under the Swap Agreement and SB-AM Swap Agreement
and (iii) the right to receive Basis Risk Shortfalls.
Class I-M-3 Margin: With respect to any Distribution Date prior to the second Distribution Date after the first possible
Optional Termination Date, 0.360% per annum, and on any Distribution Date on or after the second Distribution Date after the first
possible Optional Termination Date, 0.540% per annum.
Class I-M-3 Principal Distribution Amount: With respect to any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution Date, the remaining Group I Principal Distribution
Amount for that Distribution Date after distribution of the Class I-A Principal Distribution Amount, Class I-M-1 Principal
Distribution Amount and Class I-M-2 Principal Distribution Amount or (ii) on or after the Stepdown Date if a Trigger Event is not in
effect for that Distribution Date, the lesser of:
(i) the remaining Group I Principal Distribution Amount for that Distribution Date after distribution of the Class I-A
Principal Distribution Amount, Class I-M-1 Principal Distribution Amount and Class I-M-2 Principal Distribution Amount; and
(ii) the excess, if any, of (A) the sum of (1) the aggregate Certificate Principal Balance of the Class I-A, Class I-M-1
and Class I-M-2 Certificates (after taking into account the payment of the Class I-A Principal Distribution Amount, the Class I-M-1
Principal Distribution Amount and the Class I-M-2 Principal Distribution Amount for that Distribution Date) and (2) the Certificate
Principal Balance of the Class I-M-3 Certificates immediately prior to that Distribution Date over (B) the lesser of (x) the product
of (1) the applicable Group I Subordination Percentage and (2) the aggregate Stated Principal Balance of the Group I Loans after
giving effect to distributions to be made on that Distribution Date and (y) the excess, if any, of the aggregate Stated Principal
Balance of the Group I Loans after giving effect to distributions to be made on that Distribution Date, over the
Overcollateralization Floor.
Class I-M-4 Certificate: Any one of the Class I-M-4 Certificates executed by the Trustee and authenticated by the
Certificate Registrar substantially in the form annexed hereto as Exhibit B, senior to the Class I-M-5, Class I-M-6, Class I-M-7,
Class I-M-8, Class I-M-9, Class I-SB Certificates and Class I-R Certificates with respect to distributions and the allocation of
Realized Losses as set forth in Section 4.05, and evidencing (i) an interest designated as a “regular interest” in REMIC III for
purposes of the REMIC Provisions, (ii) the right to receive payments under the Swap Agreement and SB-AM Swap Agreement and (iii) the
right to receive Basis Risk Shortfalls.
Class I-M-4 Margin: With respect to any Distribution Date prior to the second Distribution Date after the first possible
Optional Termination Date, 0.430% per annum, and on any Distribution Date on or after the second Distribution Date after the first
possible Optional Termination Date, 0.645% per annum.
Class I-M-4 Principal Distribution Amount: With respect to any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution Date, the remaining Group I Principal Distribution
Amount for that Distribution Date after distribution of the Class I-A Principal Distribution Amount, Class I-M-1 Principal
Distribution Amount, Class I-M-2 Principal Distribution Amount and Class I-M-3 Principal Distribution Amount or (ii) on or after the
Stepdown Date if a Trigger Event is not in effect for that Distribution Date, the lesser of:
(i) the remaining Group I Principal Distribution Amount for that Distribution Date after distribution of the Class I-A
Principal Distribution Amount, Class I-M-1 Principal Distribution Amount, Class I-M-2 Principal Distribution Amount and Class I-M-3
Principal Distribution Amount; and
(ii) the excess, if any, of (A) the sum of (1) the aggregate Certificate Principal Balance of the Class I-A, Class I-M-1,
Class I-M-2 and Class I-M-3 Certificates (after taking into account the payment of the Class I-A Principal Distribution Amount, the
Class I-M-1 Principal Distribution Amount, the Class I-M-2 Principal Distribution Amount and the Class I-M-3 Principal Distribution
Amount for that Distribution Date) and (2) the Certificate Principal Balance of the Class I-M-4 Certificates immediately prior to
that Distribution Date over (B) the lesser of (x) the product of (1) the applicable Group I Subordination Percentage and (2) the
aggregate Stated Principal Balance of the Group I Loans after giving effect to distributions to be made on that Distribution Date and
(y) the excess, if any, of the aggregate Stated Principal Balance of the Group I Loans after giving effect to distributions to be
made on that Distribution Date, over the Overcollateralization Floor.
Class I-M-5 Certificate: Any one of the Class I-M-5 Certificates executed by the Trustee and authenticated by the
Certificate Registrar substantially in the form annexed hereto as Exhibit B, senior to the Class I-M-6, Class I-M-7, Class I-M-8,
Class I-M-9, Class I-SB Certificates and Class I-R Certificates with respect to distributions and the allocation of Realized Losses
as set forth in Section 4.05, and evidencing (i) an interest designated as a “regular interest” in REMIC III for purposes of the
REMIC Provisions, (ii) the right to receive payments under the Swap Agreement and SB-AM Swap Agreement and (iii) the right to receive
Basis Risk Shortfalls.
Class I-M-5 Margin: With respect to any Distribution Date prior to the second Distribution Date after the first possible
Optional Termination Date, 0.470% per annum, and on any Distribution Date on or after the second Distribution Date after the first
possible Optional Termination Date, 0.705% per annum.
Class I-M-5 Principal Distribution Amount: With respect to any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution Date, the remaining Group I Principal Distribution
Amount for that Distribution Date after distribution of the Class I-A Principal Distribution Amount, Class I-M-1 Principal
Distribution Amount, Class I-M-2 Principal Distribution Amount, Class I-M-3 Principal Distribution Amount and Class I-M-4 Principal
Distribution Amount or (ii) on or after the Stepdown Date if a Trigger Event is not in effect for that Distribution Date, the lesser
of:
(i) the remaining Group I Principal Distribution Amount for that Distribution Date after distribution of the Class I-A
Principal Distribution Amount, Class I-M-1 Principal Distribution Amount, the Class I-M-2 Principal Distribution Amount, Class I-M-3
Principal Distribution Amount and Class I-M-4 Principal Distribution Amount; and
(ii) the excess, if any, of (A) the sum of (1) the aggregate Certificate Principal Balance of the Class I-A, Class I-M-1,
Class I-M-2, Class I-M-3 and Class I-M-4 Certificates (after taking into account the payment of the Class I-A Principal Distribution
Amount, the Class I-M-1 Principal Distribution Amount, the Class I-M-2 Principal Distribution Amount, the Class I-M-3 Principal
Distribution Amount and the Class I-M-4 Principal Distribution Amount for that Distribution Date) and (2) the Certificate Principal
Balance of the Class I-M-5 Certificates immediately prior to that Distribution Date over (B) the lesser of (x) the product of (1) the
applicable Group I Subordination Percentage and (2) the aggregate Stated Principal Balance of the Group I Loans after giving effect
to distributions to be made on that Distribution Date and (y) the excess, if any, of the aggregate Stated Principal Balance of the
Group I Loans after giving effect to distributions to be made on that Distribution Date, over the Overcollateralization Floor.
Class I-M-6 Certificate: Any one of the Class I-M-6 Certificates executed by the Trustee and authenticated by the
Certificate Registrar substantially in the form annexed hereto as Exhibit B, senior to the Class I-M-7, Class I-M-8, Class I-M-9,
Class I-SB Certificates and Class I-R Certificates with respect to distributions and the allocation of Realized Losses as set forth
in Section 4.05, and evidencing (i) an interest designated as a “regular interest” in REMIC III for purposes of the REMIC Provisions,
(ii) the right to receive payments under the Swap Agreement and SB-AM Swap Agreement and (iii) the right to receive Basis Risk
Shortfalls.
Class I-M-6 Margin: With respect to any Distribution Date prior to the second Distribution Date after the first possible
Optional Termination Date, 0.530% per annum, and on any Distribution Date on or after the second Distribution Date after the first
possible Optional Termination Date, 0.795% per annum.
Class I-M-6 Principal Distribution Amount: With respect to any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution Date, the remaining Group I Principal Distribution
Amount for that Distribution Date after distribution of the Class I-A Principal Distribution Amount, Class I-M-1 Principal
Distribution Amount, Class I-M-2 Principal Distribution Amount, Class I-M-3 Principal Distribution Amount, Class I-M-4 Principal
Distribution Amount and Class I-M-5 Principal Distribution Amount or (ii) on or after the Stepdown Date if a Trigger Event is not in
effect for that Distribution Date, the lesser of:
(i) the remaining Group I Principal Distribution Amount for that Distribution Date after distribution of the Class I-A
Principal Distribution Amount, Class I-M-1 Principal Distribution Amount, the Class I-M-2 Principal Distribution Amount, Class I-M-3
Principal Distribution Amount, Class I-M-4 Principal Distribution Amount and Class I-M-5 Principal Distribution Amount; and
(ii) the excess, if any, of (A) the sum of (1) the aggregate Certificate Principal Balance of the Class I-A, Class I-M-1,
Class I-M-2, Class I-M-3, Class I-M-4 and Class I-M-5 Certificates (after taking into account the payment of the Class I-A Principal
Distribution Amount, the Class I-M-1 Principal Distribution Amount, the Class I-M-2 Principal Distribution Amount, the Class I-M-3
Principal Distribution Amount, the Class I-M-4 Principal Distribution Amount and the Class I-M-5 Principal Distribution Amount for
that Distribution Date) and (2) the Certificate Principal Balance of the Class I-M-6 Certificates immediately prior to that
Distribution Date over (B) the lesser of (x) the product of (1) the applicable Group I Subordination Percentage and (2) the aggregate
Stated Principal Balance of the Group I Loans after giving effect to distributions to be made on that Distribution Date and (y) the
excess, if any, of the aggregate Stated Principal Balance of the Group I Loans after giving effect to distributions to be made on
that Distribution Date, over the Overcollateralization Floor.
Class I-M-7 Certificate: Any one of the Class I-M-7 Certificates executed by the Trustee and authenticated by the
Certificate Registrar substantially in the form annexed hereto as Exhibit B, senior to the Class I-M-8, Class I-M-9, Class I-SB
Certificates and Class I-R Certificates with respect to distributions and the allocation of Realized Losses as set forth in Section
4.05, and evidencing (i) an interest designated as a “regular interest” in REMIC III for purposes of the REMIC Provisions, (ii) the
right to receive payments under the Swap Agreement and SB-AM Swap Agreement and (iii) the right to receive Basis Risk Shortfalls.
Class I-M-7 Margin: With respect to any Distribution Date prior to the second Distribution Date after the first possible
Optional Termination Date, 0.950% per annum, and on any Distribution Date on or after the second Distribution Date after the first
possible Optional Termination Date, 1.425% per annum.
Class I-M-7 Principal Distribution Amount: With respect to any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution Date, the remaining Group I Principal Distribution
Amount for that Distribution Date after distribution of the Class I-A Principal Distribution Amount, Class I-M-1 Principal
Distribution Amount, Class I-M-2 Principal Distribution Amount, Class I-M-3 Principal Distribution Amount, Class I-M-4 Principal
Distribution Amount, Class I-M-5 Principal Distribution Amount and Class I-M-6 Principal Distribution Amount or (ii) on or after the
Stepdown Date if a Trigger Event is not in effect for that Distribution Date, the lesser of:
(i) the remaining Group I Principal Distribution Amount for that Distribution Date after distribution of the Class I-A
Principal Distribution Amount, Class I-M-1 Principal Distribution Amount, Class I-M-2 Principal Distribution Amount, Class I-M-3
Principal Distribution Amount, Class I-M-4 Principal Distribution Amount, Class I-M-5 Principal Distribution Amount and Class I-M-6
Principal Distribution Amount; and
(ii) the excess, if any, of (A) the sum of (1) the aggregate Certificate Principal Balance of the Class I-A, Class I-M-1,
Class I-M-2, Class I-M-3, Class I-M-4, Class I-M-5 and Class I-M-6 Certificates (after taking into account the payment of the Class
I-A Principal Distribution Amount, Class I-M-1 Principal Distribution Amount, Class I-M-2 Principal Distribution Amount, Class I-M-3
Principal Distribution Amount, Class I-M-4 Principal Distribution Amount, Class I-M-5 Principal Distribution Amount and Class I-M-6
Principal Distribution Amount for that Distribution Date) and (2) the Certificate Principal Balance of the Class I-M-7 Certificates
immediately prior to that Distribution Date over (B) the lesser of (x) the product of (1) the applicable Group I Subordination
Percentage and (2) the aggregate Stated Principal Balance of the Group I Loans after giving effect to distributions to be made on
that Distribution Date and (y) the excess, if any, of the aggregate Stated Principal Balance of the Group I Loans after giving effect
to distributions to be made on that Distribution Date, over the Overcollateralization Floor.
Class I-M-8 Certificate: Any one of the Class I-M-8 Certificates executed by the Trustee and authenticated by the
Certificate Registrar substantially in the form annexed hereto as Exhibit B, senior to the Class I-M-9, Class I-SB Certificates and
Class I-R Certificates with respect to distributions and the allocation of Realized Losses as set forth in Section 4.05, and
evidencing (i) an interest designated as a “regular interest” in REMIC III for purposes of the REMIC Provisions, (ii) the right to
receive payments under the Swap Agreement and SB-AM Swap Agreement and (iii) the right to receive Basis Risk Shortfalls.
Class I-M-8 Margin: With respect to any Distribution Date prior to the second Distribution Date after the first possible
Optional Termination Date, 1.150% per annum, and on any Distribution Date on or after the second Distribution Date after the first
possible Optional Termination Date, 1.725% per annum.
Class I-M-8 Principal Distribution Amount: With respect to any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution Date, the remaining Group I Principal Distribution
Amount for that Distribution Date after distribution of the Class I-A Principal Distribution Amount, Class I-M-1 Principal
Distribution Amount, Class I-M-2 Principal Distribution Amount, Class I-M-3 Principal Distribution Amount, Class I-M-4 Principal
Distribution Amount, Class I-M-5 Principal Distribution Amount, Class I-M-6 Principal Distribution Amount and Class I-M-7 Principal
Distribution Amount or (ii) on or after the Stepdown Date if a Trigger Event is not in effect for that Distribution Date, the lesser
of:
(i) the remaining Group I Principal Distribution Amount for that Distribution Date after distribution of the Class I-A
Principal Distribution Amount, Class I-M-1 Principal Distribution Amount, Class I-M-2 Principal Distribution Amount, Class I-M-3
Principal Distribution Amount, Class I-M-4 Principal Distribution Amount, Class I-M-5 Principal Distribution Amount, Class I-M-6
Principal Distribution Amount and Class I-M-7 Principal Distribution Amount; and
(ii) the excess, if any, of (A) the sum of (1) the aggregate Certificate Principal Balance of the Class I-A, Class I-M-1,
Class I-M-2, Class I-M-3, Class I-M-4, Class I-M-5, Class I-M-6 and Class I-M-7 Certificates (after taking into account the payment
of the Class I-A Principal Distribution Amount, Class I-M-1 Principal Distribution Amount, Class I-M-2 Principal Distribution Amount,
Class I-M-3 Principal Distribution Amount, Class I-M-4 Principal Distribution Amount, Class I-M-5 Principal Distribution Amount,
Class I-M-6 Principal Distribution Amount and Class I-M-7 Principal Distribution Amount for that Distribution Date) and (2) the
Certificate Principal Balance of the Class I-M-8 Certificates immediately prior to that Distribution Date over (B) the lesser of (x)
the product of (1) the applicable Group I Subordination Percentage and (2) the aggregate Stated Principal Balance of the Group I
Loans after giving effect to distributions to be made on that Distribution Date and (y) the excess, if any, of the aggregate Stated
Principal Balance of the Group I Loans after giving effect to distributions to be made on that Distribution Date, over the
Overcollateralization Floor.
Class I-M-9 Certificate: Any one of the Class I-M-9 Certificates executed by the Trustee and authenticated by the
Certificate Registrar substantially in the form annexed hereto as Exhibit B, senior to the Class I-SB Certificates and Class I-R
Certificates with respect to distributions and the allocation of Realized Losses as set forth in Section 4.05, and evidencing (i) an
interest designated as a “regular interest” in REMIC III for purposes of the REMIC Provisions, (ii) the right to receive payments
under the Swap Agreement and SB-AM Swap Agreement and (iii) the right to receive Basis Risk Shortfalls.
Class I-M-9 Margin: With respect to any Distribution Date prior to the second Distribution Date after the first possible
Optional Termination Date, 1.900% per annum, and on any Distribution Date on or after the second Distribution Date after the first
possible Optional Termination Date, 2.850% per annum.
Class I-M-9 Principal Distribution Amount: With respect to any Distribution Date (a) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution Date, the remaining Group I Principal Distribution
Amount for that Distribution Date after distribution of the Class I-A Principal Distribution Amount, the Class I-M-1 Principal
Distribution Amount, the Class I-M-2 Principal Distribution Amount, the Class I-M-3 Principal Distribution Amount, the Class I-M-4
Principal Distribution Amount, the Class I-M-5 Principal Distribution Amount, Class I-M-6 Principal Distribution Amount, the Class
I-M-7 Principal Distribution Amount and the Class I-M-8 Principal Distribution Amount or (b) on or after the Stepdown Date if a
Trigger Event is not in effect for that Distribution Date, the lesser of:
(i) the remaining Group I Principal Distribution Amount for that Distribution Date after distribution of the Class I-A
Principal Distribution Amount, the Class I-M-1 Principal Distribution Amount, the Class I-M-2 Principal Distribution Amount, the
Class I-M-3 Principal Distribution Amount, the Class I-M-4 Principal Distribution Amount, the Class I-M-5 Principal Distribution
Amount, Class I-M-6 Principal Distribution Amount, Class I-M-7 Principal Distribution Amount and the Class I-M-8 Principal
Distribution Amount; and
(ii) the excess, if any, of (A) the sum of (1) the aggregate Certificate Principal Balance of the Class I-A Certificates,
Class I-M-1 Certificates, Class I-M-2 Certificates, Class I-M-3 Certificates, Class I-M-4 Certificates, Class I-M-5 Certificates,
Class I-M-6 Certificates, Class I-M-7 Certificates and Class I-M-8 Certificates (after taking into account the payment of the Class
I-A Principal Distribution Amount, the Class I-M-1 Principal Distribution Amount, the Class I-M-2 Principal Distribution Amount, the
Class I-M-3 Principal Distribution Amount, the Class I-M-4 Principal Distribution Amount, the Class I-M-5 Principal Distribution
Amount, Class I-M-6 Principal Distribution Amount, Class I-M-7 Principal Distribution Amount and the Class I-M-8 Principal
Distribution Amount for that Distribution Date) and (2) the Certificate Principal Balance of the Class I-M-9 Certificates immediately
prior to that Distribution Date over (B) the lesser of (x) the product of (1) the applicable Group I Subordination Percentage and (2)
the aggregate Stated Principal Balance of the Group I Loans after giving effect to distributions to be made on that Distribution Date
and (y) the excess, if any, of the aggregate Stated Principal Balance of the Group I Loans after giving effect to distributions to be
made on that Distribution Date, over the Overcollateralization Floor.
Class I-P Certificate: Any one of the Class I-P Certificates executed by the Trustee and authenticated by the Certificate
Registrar substantially in the form annexed hereto as Exhibit 7 evidencing a percentage interest in any Prepayment Charges relating
to the Group I Loans.
Class I-P Reserve Account Amount: $100.
Class I-R Certificate: Any one of the Class I-R-I, Class I-R-II or Class I-R-III Certificates.
Class I-R-I Certificate: Any one of the Class I-R-I Certificates executed by the Trustee and authenticated by the
Certificate Registrar substantially in the form annexed to the Standard Terms as Exhibit D and evidencing an interest designated as a
“residual interest” in REMIC I for purposes of the REMIC Provisions.
Class I-R-II Certificate: Any one of the Class I-R-II Certificates executed by the Trustee and authenticated by the
Certificate Registrar substantially in the form annexed to the Standard Terms as Exhibit D and evidencing an interest designated as a
“residual interest” in REMIC II for purposes of the REMIC Provisions.
Class I-R-III Certificate: Any one of the Class I-R-III Certificates executed by the Trustee and authenticated by the
Certificate Registrar substantially in the form annexed to the Standard Terms as Exhibit D and evidencing an interest designated as a
“residual interest” in REMIC III for purposes of the REMIC Provisions.
Class I-SB Certificate: Any one of the Class I-SB Certificates executed by the Trustee and authenticated by the Certificate
Registrar substantially in the form annexed hereto as Exhibit 6, subordinate to the Class I-A Certificates and Class I-M Certificates
with respect to distributions and the allocation of Realized Losses as set forth in Section 4.05, and evidencing ownership of REMIC
III Regular Interests I-SB-IO and I-SB-PO designated as “regular interests” in REMIC III for purposes of the REMIC Provisions,
together with certain rights to payments under the Swap Agreement for purposes of the REMIC Provisions and certain obligations with
respect to payments of Basis Risk Shortfalls.
Class II-A Certificate: The Class II-A-1 Certificates and Class II-A-2 Certificates, executed by the Trustee and
authenticated by the Certificate Registrar substantially in the form annexed to the Standard Terms as Exhibit A.
Class II-A-1 Certificate: The Class II-A-1 Certificates, executed by the Trustee and authenticated by the Certificate
Registrar substantially in the form annexed to the Standard Terms as Exhibit A, senior to the Class II-M Certificates and Class II-B
Certificates with respect to distributions and the allocation of Realized Losses as set forth in Section 4.05, evidencing an interest
designated as a “regular interest” in REMIC IV for purposes of the REMIC Provisions.
Class II-A-2 Certificate: The Class II-A-2 Certificates, executed by the Trustee and authenticated by the Certificate
Registrar substantially in the form annexed to the Standard Terms as Exhibit A, evidencing an interest designated as a “regular
interest” in REMIC IV for purposes of the REMIC Provisions.
Class II-B Certificate: Collectively, the Class II-B-I, Class II-B-2 and Class II-B-3 Certificates executed by the Trustee
and authenticated by the Certificate Registrar substantially in the form annexed to the Standard Terms as Exhibit C.
Class II-B-1 Certificate: The Class II-B-1 Certificates, executed by the Trustee and authenticated by the Certificate
Registrar substantially in the form annexed to the Standard Terms as Exhibit C, senior to the Class II-B-2 Certificates and Class
II-B-3 Certificates with respect to distributions and the allocation of Realized Losses as set forth in Section 4.05, evidencing an
interest designated as a “regular interest” in REMIC IV for purposes of the REMIC Provisions.
Class II-B-2 Certificate: The Class II-B-2 Certificates, executed by the Trustee and authenticated by the Certificate
Registrar substantially in the form annexed to the Standard Terms as Exhibit C, senior to the Class II-B-3 Certificates with respect
to distributions and the allocation of Realized Losses as set forth in Section 4.05, evidencing an interest designated as a “regular
interest” in REMIC IV for purposes of the REMIC Provisions.
Class II-B-3 Certificate: The Class II-B-3 Certificates, executed by the Trustee and authenticated by the Certificate
Registrar substantially in the form annexed to the Standard Terms as Exhibit C, evidencing an interest designated as a “regular
interest” in REMIC IV for purposes of the REMIC Provisions.
Class II-M-1 Certificate: Any one of the Class II-M-1 Certificates executed by the Trustee and authenticated by the
Certificate Registrar substantially in the form annexed hereto as Exhibit B, senior to the Class II-M-2, Class II-M-3 and Class II-B
Certificates with respect to distributions and the allocation of Realized Losses as set forth in Section 4.05, and evidencing an
interest designated as a “regular interest” in REMIC IV for purposes of the REMIC Provisions.
Class II-M-2 Certificate: Any one of the Class II-M-2 Certificates executed by the Trustee and authenticated by the
Certificate Registrar substantially in the form annexed hereto as Exhibit B, senior to the Class II-M-3 and Class II-B Certificates
with respect to distributions and the allocation of Realized Losses as set forth in Section 4.05,, and evidencing an interest
designated as a “regular interest” in REMIC IV for purposes of the REMIC Provisions.
Class II-M-3 Certificate: Any one of the Class II-M-3 Certificates executed by the Trustee and authenticated by the
Certificate Registrar substantially in the form annexed hereto as Exhibit B, senior to the Class II-B Certificates with respect to
distributions and the allocation of Realized Losses as set forth in Section 4.05, and evidencing an interest designated as a “regular
interest” in REMIC IV for purposes of the REMIC Provisions.
Class II-M Certificate: Collectively, the Class II-M-1, Class II-M-2 and Class II-M-3 Certificates executed by the Trustee
and authenticated by the Certificate Registrar substantially in the form annexed to the Standard Terms as Exhibit B.
Class II-P Certificate: Any one of the Class II-P Certificates executed by the Trustee and authenticated by the Certificate
Registrar substantially in the form annexed hereto as Exhibit 7, evidencing a percentage interest in any Prepayment Charges relating
to the Group II Loans.
Class II-P Reserve Account Amount: $100.
Class II-R-I Certificate: Any one of the Class II-R-I Certificates executed by the Trustee and authenticated by the
Certificate Registrar substantially in the form annexed to the Standard Terms as Exhibit D and evidencing an interest designated as a
“residual interest” in REMIC IV for purposes of the REMIC Provisions.
Class A Certificates: Together, the Class I-A Certificates and Class II-A Certificates.
Class M Certificates: Together, the Class I-M Certificates and Class II-M Certificates.
Class P Certificates: Together, the Class I-P Certificates and Class II-P Certificates.
Class R Certificates: Together, the Class I-R Certificates and Class II-R-I Certificates.
Class P Reserve Account: The account established and maintained by the Trustee pursuant to Section 4.09 hereof.
Closing Date: June 29, 2006.
Corporate Trust Office: The principal office of the Trustee at which at any particular time its corporate trust business
with respect to this Agreement shall be administered, which office at the date of the execution of this instrument is located at 0000
Xxxx Xx. Xxxxxx Xxxxx, Xxxxx Xxx, Xxxxxxxxxx 00000-0000, Attention: Residential Funding Corporation, RALI 2006-QA5.
Credit Support Depletion Date: The first Distribution Date on which the aggregate Certificate Principal Balance of the
Class II-M Certificates and the Class II-B Certificates has been reduced to zero.
Cut-off Date Balance: $701,729,165.83.
Cut-off Date: June 1, 2006.
Defaulting Party: As defined in the Swap Agreement.
Definitive Certificate: Any definitive, fully registered Certificate.
Determination Date: With respect to any Distribution Date, the second Business Day prior to each Distribution Date.
Discount Net Mortgage Rate: Not applicable.
Due Period: With respect to each Distribution Date, the calendar month in which such Distribution Date occurs.
Early Termination Date: Shall have the meaning set forth in the Swap Agreement.
Excess Bankruptcy Loss: Bankruptcy Losses in excess of the Bankruptcy Amount.
Excess Cash Flow: With respect to the Group I Certificates and any Distribution Date, an amount equal to the sum of (A) the
excess of (i) the Available Distribution Amount for Loan Group I for that Distribution Date over (ii) the sum of (a) the Group I
Interest Distribution Amount for that Distribution Date and (b) the Group I Principal Remittance Amount for that Distribution Date to
the extent not applied to pay interest on the Class I-A Certificates and Class I-M Certificates on such Distribution Date and (B) the
Overcollateralization Reduction Amount, if any, for that Distribution Date.
Excess Fraud Loss: Fraud Losses in excess of the Fraud Loss Amount.
Excess Overcollateralization Amount: With respect to any Distribution Date, the excess, if any, of (a) the
Overcollateralization Amount on such Distribution Date over (b) the Required Overcollateralization Amount.
Excess Special Hazard Loss: Special Hazard Losses in excess of the Special Hazard Amount.
Excess Subordinate Principal Amount: Not applicable.
Expense Fee Rate: With respect to any Mortgage Loan as of any date of determination, the sum of the Servicing Fee Rate and
the rate per annum at which the Subservicing Fee accrues.
Fraud Loss Amount: With respect to the Group II Certificates, as of any date of determination after the Cut-off Date, an
amount equal to: (X) prior to the first anniversary of the Cut-off Date an amount equal to 3.00% of the aggregate outstanding
principal balance of all of the Mortgage Loans in Loan Group II as of the Cut-off Date minus the aggregate amount of Fraud Losses
allocated solely to one or more specific Classes of Certificates in accordance with Section 4.05 of this Series Supplement since the
Cut-off Date up to such date of determination, (Y) from the first to, but not including, the second anniversary of the Cut-off Date,
an amount equal to (1) the lesser of (a) the Fraud Loss Amount as of the most recent anniversary of the Cut-off Date and (b) 2.00% of
the aggregate outstanding principal balance of all of the Mortgage Loans in Loan Group II as of the most recent anniversary of the
Cut-off Date minus (2) the aggregate amount of Fraud Losses allocated solely to one or more specific Classes of Certificates in
accordance with Section 4.05 since the most recent anniversary of the Cut-off Date up to such date of determination, and (Z) from the
second to, but not including, the fifth anniversary of the Cut-off Date, an amount equal to (1) the lesser of (a) the Fraud Loss
Amount as of the most recent anniversary of the Cut-off Date and (b) 1.00% of the aggregate outstanding principal balance of all of
the Mortgage Loans in Loan Group II as of the most recent anniversary of the Cut-off Date minus (2) the aggregate amount of Fraud
Losses allocated solely to one or more specific Classes of Certificates in accordance with Section 4.05 since the most recent
anniversary of the Cut-off Date up to such date of determination. On and after the fifth anniversary of the Cut-off Date, the Fraud
Loss Amount shall be zero.
The Fraud Loss Amount may be further reduced by the Master Servicer (including accelerating the manner in which such
coverage is reduced) provided that prior to any such reduction, the Master Servicer shall (i) obtain written confirmation from each
Rating Agency that such reduction shall not reduce the rating assigned to any Class of Certificates by such Rating Agency below the
lower of the then-current rating or the rating assigned to such Certificates as of the Closing Date by such Rating Agency and (ii)
provide a copy of such written confirmation to the Trustee.
Fraud Losses: Realized Losses on Mortgage Loans in Loan Group II as to which there was fraud in the origination of such
Mortgage Loan.
Gross Margin: With respect to each Mortgage Loan, the fixed percentage set forth in the related Mortgage Note and indicated
on the Mortgage Loan Schedule attached hereto as the “NOTE MARGIN,” which percentage is added to the related Index on each Adjustment
Date to determine (subject to rounding in accordance with the related Mortgage Note, the Periodic Cap, the Maximum Mortgage Rate and
the Minimum Mortgage Rate) the interest rate to be borne by such Mortgage Loan until the next Adjustment Date.
Group I Interest Distribution Amount: For any Distribution Date, the aggregate of the amounts payable pursuant to Section
4.02(c)(I)(i)(A).
Group I Certificates: The Class I-A, Class I-M, Class I-SB, Class I-P and Class I-R Certificates.
Group I Cut-off Date Balance: $89,520,806.
Group I Loans: The Mortgage Loans designated as Group I Loans in Exhibit 1.
Group II Certificates: The Class II-A, Class II-M, Class II-B, Class II-P-1 and Class II-R-I Certificates.
Group II Loans: The Mortgage Loans designated as Group II Loans in Exhibit 1.
Group I Principal Distribution Amount: With respect to any Distribution Date, the lesser of (a) the excess of (x) Available
Distribution Amount with respect to Loan Group I over (y) the Group I Interest Distribution Amount and (b) the sum of:
(i) the principal portion of each Monthly Payment received or Advanced with respect to the related Due Period on each
Outstanding Mortgage Loan in Loan Group I;
(ii) the Stated Principal Balance of any Mortgage Loan in Loan Group I repurchased during the related Prepayment Period
(or deemed to have been so repurchased in accordance with Section 3.07(b)) pursuant to Section 2.02, 2.03, 2.04 or 4.07 and the
amount of any shortfall deposited in the Custodial Account in connection with the substitution of a Deleted Mortgage Loan pursuant to
Section 2.03 or 2.04 during the prior calendar month;
(iii) the principal portion of all other unscheduled collections, other than Subsequent Recoveries, on the Mortgage Loans
in Loan Group I received (or deemed to have been so received) during the prior calendar month or, in the case of Principal
Prepayments in Full, during the related Prepayment Period, including, without limitation, Curtailments, Insurance Proceeds,
Liquidation Proceeds, REO Proceeds and Principal Prepayments, to the extent applied by the Master Servicer as recoveries of principal
pursuant to Section 3.14;
(iv) the lesser of (1) Subsequent Recoveries from Group I Loans for such Distribution Date and (2) the principal portion
of any Realized Losses allocated to any Class of Group I Certificates on a prior Distribution Date and remaining unpaid;
(v) the lesser of (1) the Excess Cash Flow for such Distribution Date (to the extent not used pursuant to clause (iv) of
this definition on such Distribution Date) and (2) the principal portion of any Realized Losses incurred (or deemed to have been
incurred) on any Mortgage Loans in Loan Group I in the calendar month preceding such Distribution Date that are allocated to any
Class of Certificates to the extent covered by Excess Cash Flow and Net Swap Payments; and
(vi) the lesser of (a) the Excess Cash Flow for such Distribution Date, to the extent not used pursuant to clauses (iv)
and (v) of this definition on such Distribution Date, and (b) the amount of any Overcollateralization Increase Amount for such
Distribution Date;
minus
(vii) (A) the amount of any Overcollateralization Reduction Amount for such Distribution Date and (B) the amount of any
Capitalization Reimbursement Amount for such Distribution Date.
Group I Principal Remittance Amount: With respect to any Distribution Date and the Group I Certificates, all amounts
described in clauses (b)(i) through (iii) of the definition of Group I Principal Distribution Amount for that Distribution Date.
Group I Subordination Percentage: With respect to each class of Class I-A Certificates and Class I-M Certificates, the
respective approximate percentage set forth in the table below:
Class Percentage
I-A 87.10%
I-M-1 90.40%
I-M-2 92.10%
I-M-3 93.40%
I-M-4 94.20%
I-M-5 94.90%
I-M-6 95.60%
I-M-7 96.30%
I-M-8 97.00%
I-M-9 98.00%
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Group II Senior Accelerated Distribution Percentage: With respect to any Distribution Date occurring on or prior to the 84th
Distribution Date and, with respect to Loan Group II, 100%. With respect to any Distribution Date thereafter and Loan Group II, as
follows:
(i) for any Distribution Date after the 84th Distribution Date but on or prior to the 96th Distribution Date,
the Group II Senior Percentage for such Distribution Date plus 70% of the Group II Subordinate Percentage for such
Distribution Date;
(ii) for any Distribution Date after the 96th Distribution Date but on or prior to the 108th Distribution Date,
the Group II Senior Percentage for such Distribution Date plus 60% of the Group II Subordinate Percentage for such
Distribution Date;
(iii) for any Distribution Date after the 108th Distribution Date but on or prior to the 120th Distribution Date,
the Group II Senior Percentage for such Distribution Date plus 40% of the Group II Subordinate Percentage for such
Distribution Date;
(iv) for any Distribution Date after the 120th Distribution Date but on or prior to the 132nd Distribution Date,
the Group II Senior Percentage for such Distribution Date plus 20% of the Group II Subordinate Percentage for such
Distribution Date; and
(v) for any Distribution Date thereafter, the Group II Senior Percentage for such Distribution Date.
Any scheduled reduction, as described in the preceding paragraph, shall not be made as of any Distribution Date unless:
the outstanding principal balance of the Mortgage Loans in Loan Group II delinquent 60 days or more (including
Mortgage Loans in Loan Group II which are in foreclosure, have been foreclosed or otherwise liquidated, or with
respect to which the Mortgagor is in bankruptcy and any REO Property) averaged over the last six months, as a
percentage of the aggregate outstanding Certificate Principal Balance of the Class II-M Certificates and Class II-B
Certificates, is less than 50% and
Realized Losses on the Mortgage Loans in Loan Group II to date for such Distribution Date, if
occurring during the eighth, ninth, tenth, eleventh or twelfth year, or any year thereafter, after the Closing Date,
are less than 30%, 35%, 40%, 45% or 50%, respectively, of the sum of the Initial Certificate Principal Balances of
the Class II-M Certificates and Class II-B Certificates.
Notwithstanding the foregoing, if (a) the Group II Subordinate Percentage is equal to or in excess of twice the initial
Group II Subordinate Percentage, (b) the outstanding principal balance of the Mortgage Loans in Loan Group II delinquent 60 days or
more (including Mortgage Loans in laon Goup II which are in foreclosure, have been foreclosed or otherwise liquidated, or with
respect to which the Mortgagor is in bankruptcy and any REO Property) averaged over the last six months, as a percentage of the
aggregate outstanding Certificate Principal Balance of the Class II-M Certificates and Class II-B Certificates, does not exceed 50%
and (c)(i) prior to the Distribution Date in July 2009, cumulative Realized Losses on the Mortgage Loans in Loan Group II do not
exceed 20% of the sum of the initial Certificate Principal Balances of the Class II-M Certificates and Class II-B Certificates, and
(ii) thereafter, cumulative Realized Losses on the Mortgage Loans in Loan Group II do not exceed 30% of the sum of the initial
Certificate Principal Balances of the Class II-M Certificates and Class II-B Certificates, then (A) on any Distribution Date prior to
the Distribution Date in July 2009, the Group II Senior Accelerated Distribution Percentage for such Distribution Date will equal the
Group II Senior Percentage for that Distribution Date plus 50% of the Group II Subordinate Percentage for such Distribution Date, and
(B) on any Distribution Date on or after the Distribution Date in July 2009, the Group II Senior Accelerated Distribution Percentage
for that Distribution Date will equal the Group II Senior Percentage for that Distribution Date.
Notwithstanding the foregoing, upon reduction of the Certificate Principal Balances of the Class II-A Certificates and Class
II-R-I Certifcates to zero, the Group II Senior Accelerated Distribution Percentage will equal 0%.
Group II Senior Certificates: The Class II-A Certificates and the Class II-R-1 Certificates.
Group II Senior Percentage: As of each Distribution Date, the lesser of 100% and a fraction, expressed as a percentage, the
numerator of which is the aggregate Certificate Principal Balance of the Group II Certificates immediately prior to such Distribution
Date and the denominator of which is the aggregate Stated Principal Balance of all of the Mortgage Loans (or related REO Properties)
in Loan Group II immediately prior to such Distribution Date.
Group II Senior Principal Distribution Amount: As to any Distribution Date, the lesser of (a) the balance of the Available
Distribution Amount related to Loan Group II remaining after the distribution therefrom of all amounts required to be distributed
therefrom pursuant to Section 4.02(c)(II)(A)(i) of this Series Supplement, and (b) the sum of the amounts required to be distributed
therefrom to the Group II Certificateholders on such Distribution Date pursuant to Section 4.02(c)(II)(A)(ii) and Section
4.02(c)(II)(A)(xvi).
Group II Subordinate Certificates: The Class II-M Certificates and the Class II-B Certificates.
Group II Subordinate Percentage: With respect to Loan Group II and as of any date of determination, a percentage equal to
100% minus the Group II Senior Percentage as of that date.
Group II Subordinate Principal Distribution Amount: With respect to any Distribution Date and Loan Group II and each Class
of Group II Subordinate Certificates, (a) the sum of (i) the product of (x) the Class’s pro rata share, based on the Certificate
Principal Balance of each such Class then outstanding, and (y) the aggregate of the amounts calculated for such Distribution Date
under clauses (1), (2) and (3) of Section 4.02(c)(II)(A)(ii)(a) of this Series Supplement (without giving effect to the Group II
Senior Percentage) to the extent not payable to the Group II Senior Certificates; (ii) such Class’s pro rata share, based on the
Certificate Principal Balance of each Class of Group II Subordinate Certificates then outstanding, of the principal collections
described in Section 4.02(c)(II)(A)(ii)(b)(ii) of this Series Supplement (without giving effect to the Group II Senior Accelerated
Distribution Percentage) to the extent such collections are not otherwise distributed to the Group II Senior Certificates; (iii) the
product of (x) the Prepayment Distribution Percentage and (y) the aggregate of all Principal Prepayments in Full received in the
related Prepayment Period and Curtailments on the Group II Loans received in the preceding calendar month to the extent not payable
to the Group II Senior Certificates; and (iv) any amounts described in clauses (i), (ii) and (iii) as determined for any previous
Distribution Date, that remain undistributed to the extent that such amounts are not attributable to Realized Losses which have been
allocated to a Class of Group II Subordinate Certificates; minus (b) the related Capitalization Reimbursement Amount for such
Distribution Date, multiplied by a fraction, the numerator of which is the Group II Subordinate Principal Distribution Amount for
such Class of Group II Subordinate Certificates, without giving effect to this clause (b), and the denominator of which is the sum of
the principal distribution amounts for all related Classes of Group II Certificates, in each case to the extent derived from the
related Available Distribution Amount without giving effect to any reductions for the Capitalization Reimbursement Amount.
Initial Monthly Payment Fund: $0 representing scheduled principal amortization and interest at the Net Mortgage Rate payable
during the July 2006 Due Period, for those Mortgage Loans for which the Trustee will not be entitled to receive such payment.
Initial Subordinate Class Percentage: With respect to each Class of Group II Subordinate Certificates, an amount which is
equal to the initial aggregate Certificate Principal Balance of such Class of Group II Subordinate Certificates divided by the
aggregate Stated Principal Balance of all the Mortgage Loans in Loan Group II as of the Cut-off Date as follows:
Class II-M-1: 0.27% Class II-B-1: 0.10%
Class II-M-2: 0.27% Class II-B-2: 0.07%
Class II-M-3: 0.09% Class II-B-3: 0.05%
Interest Accrual Period: (i) With respect to the Group I Certificates and the Distribution Date in July 2006, the period
commencing on the Closing Date and ending on the day immediately preceding the Distribution Date in July 2006, and with respect to
the Group I Certificates and any Distribution Date after the Distribution Date in July 2006, the period commencing on the
Distribution Date in the month immediately preceding the month in which such Distribution Date occurs and ending on the day
immediately preceding such Distribution Date. With respect to the Group II Certificates, the calendar month preceding the month in
which the Distribution Date occurs.
Interest Only Certificates: None.
LIBOR: With respect to any Distribution Date, the arithmetic mean of the placeCityLondon interbank offered rate quotations
for one-month U.S. Dollar deposits, expressed on a per annum basis, determined in accordance with Section 1.02.
LIBOR Business Day: Any day other than (i) a Saturday or Sunday or (ii) a day on which banking institutions in
placeCityLondon, country-regionEngland are required or authorized to by law to be closed.
LIBOR Certificates: The Class I-A Certificates and Class I-M Certificates.
LIBOR Rate Adjustment Date: With respect to each Distribution Date, the second LIBOR Business Day immediately preceding the
commencement of the related Interest Accrual Period.
Liquidation Proceeds: As defined in the Standard Terms but excluding Subsequent Recoveries.
Loan Group: Loan Group I or Loan Group II.
Loan Group I: The group of Mortgage Loans comprised of the Group I Loans.
Loan Group II: The group of Mortgage Loans comprised of the Group II Loans.
Margin: The Class I-A-1 Margin, Class I-A-2 Margin, Class I-A-3 Margin, Class I-M-1 Margin, Class I-M-2 Margin, Class I-M-3
Margin, Class I-M-4 Margin, Class I-M-5 Margin, Class I-M-6 Margin, Class I-M-7 Margin, Class I-M-8 Margin or Class I-M-9 Margin, as
applicable.
Marker Rate: With respect to the Class I-SB Certificates or REMIC III Regular Interest I-SB-IO and any Distribution Date,
in relation to the REMIC II Regular Interests LT1, LT2, LT3, and LT4, a per annum rate equal to two (2) times the weighted average of
the Uncertificated REMIC II Pass-Through Rates for REMIC II Regular Interest LT2 and REMIC II Regular Interest LT3.
Maturity Date: July 25, 2036, the Distribution Date in the month of the latest scheduled maturity date of any Mortgage
Loan.
Maximum Mortgage Rate: As to any Mortgage Loan, the per annum rate indicated in Mortgage Loan Schedule hereto attached
hereto as the “NOTE CEILING,” which rate is the maximum interest rate that may be applicable to such Mortgage Loan at any time during
the life of such Mortgage Loan.
Maximum Net Mortgage Rate: As to any Mortgage Loan and any date of determination, the Maximum Mortgage Rate minus the
Expense Fee Rate.
Mortgage: With respect to each Mortgage Note related to a Mortgage Loan which is not a Cooperative Loan, the mortgage, deed
of trust or other comparable instrument creating a first lien on an estate in fee simple or leasehold interest in real property
securing a Mortgage Note. With respect to each Obligation to Pay related to a Sharia Mortgage Loan, the Sharia Mortgage Loan
Security Instrument.
Mortgage Loan Schedule: The list or lists of the Mortgage Loans attached hereto as Exhibit 1 ( and as amended from time to
time to reflect the addition of Qualified Substitute Mortgage Loans), which list or lists shall set forth the following information
as to each Mortgage Loan:
(i) the Mortgage Loan identifying number (“RFC LOAN #”);
(ii) the maturity of the Mortgage Note (“MATURITY DATE”);
(iii) the Mortgage Rate as of origination (“ORIG RATE”);
(iv) the Mortgage Rate as of the Cut-off Date (“CURR RATE”);
(v) the Net Mortgage Rate as of the Cut-off Date (“CURR NET”);
(vi) the scheduled monthly payment of principal, if any, and interest as of the Cut-off Date (“ORIGINAL P & I” or
“CURRENT P & I”);
(vii) the Cut-off Date Principal Balance (“PRINCIPAL BAL”);
(viii) the Maximum Mortgage Rate (“NOTE CEILING”);
(ix) the maximum Net Mortgage Rate (“NET CEILING”);
(x) the Note Margin (“NOTE MARGIN”);
(xi) the Note Margin (“NOTE MARGIN”);
(xii) the Periodic Cap (“PERIODIC DECR” or “PERIODIC INCR”);
(xiii) the rounding of the semi-annual or annual adjustment to the Mortgage Rate (“NOTE METHOD”);
(xiv) the Loan-to-Value Ratio at origination (“LTV”);
(xv) the rate at which the Subservicing Fee accrues (“SUBSERV FEE”) and at which the Servicing Fee accrues (“MSTR SERV
FEE”);
(xvi) a code “T,” “BT” or “CT” under the column “LN FEATURE,” indicating that the Mortgage Loan is secured by a second or
vacation residence; and
(xvii) a code “N” under the column “OCCP CODE,” indicating that the Mortgage Loan is secured by a non-owner occupied
residence.
Such schedule may consist of multiple reports that collectively set forth all of the information required.
Mortgage Loans: Such of the mortgage loans, including any Sharia Mortgage Loans, transferred and assigned to the Trustee
pursuant to Section 2.01 as from time to time are held or deemed to be held as a part of the Trust Fund, the Mortgage Loans
originally so held being identified in the initial Mortgage Loan Schedule, and Qualified Substitute Mortgage Loans held or deemed
held as part of the Trust Fund including, without limitation, (i) with respect to each Cooperative Loan, the related Mortgage Note,
Security Agreement, Assignment of Proprietary Lease, Cooperative Stock Certificate, Cooperative Lease and Mortgage File and all
rights appertaining thereto, (ii) with respect to each Sharia Mortgage Loan, the related Obligation to Pay, Sharia Mortgage Loan
Security Instrument, Sharia Mortgage Loan Co-Ownership Agreement, Assignment Agreement and Amendment of Security Instrument and
Mortgage File and all rights appertaining thereto and (iii) with respect to each Mortgage Loan other than a Cooperative Loan or a
Sharia Mortgage Loan, each related Mortgage Note, Mortgage and Mortgage File and all rights appertaining thereto.
Mortgage Note: The originally executed note or other evidence of indebtedness evidencing the indebtedness of a Mortgagor
under a Mortgage Loan, together with any modification thereto. With respect to each Sharia Mortgage Loan, the related Obligation to
Pay.
Mortgage Rate: With respect to any Mortgage Loan, the interest rate borne by the related Mortgage Note, or any modification
thereto other than a Servicing Modification. As to any Sharia Mortage Loan, the profit factor described in the related Obligation to
Pay, or any modification thereto other than a Servicing Modification. The Mortgage Rate on each Mortgage Loan will adjust on each
Adjustment Date to equal the sum (rounded to the nearest multiple of one eighth of one percent (0.125%) or up to the nearest
one-eighth of one percent, which are indicated by a “U” on the Mortgage Loan Schedule, except in the case of the Mortgage Loans
indicated by an “X” on the Mortgage Loan Schedule under the heading “NOTE METHOD”), of the related Index plus the Note Margin, in
each case subject to the applicable Periodic Cap, Maximum Mortgage Rate and Minimum Mortgage Rate.
Mortgagor: The obligor on a Mortgage Note, or with respect to a Sharia Mortgage Loan, the consumer on an Obligation to Pay.
Net Mortgage Rate: With respect to any Mortgage Loan as of any date of determination, a per annum rate equal to the
Mortgage Rate for such Mortgage Loan as of such date minus the related Expense Fee Rate.
Net Swap Payment: With respect to each Distribution Date, the net payment required to be made pursuant to the terms of the
Swap Agreement by either the Swap Counterparty or the Trustee, on behalf of the Trust, which net payment shall not take into account
any Swap Termination Payment.
Net WAC Cap Rate: With respect to any Distribution Date and the Class I-A Certificates and Class I-M Certificates, a per
annum rate equal to (i) the product of (a) the weighted average of the Net Mortgage Rates (or, if applicable, the Modified Net
Mortgage Rates) on the Group I Loans using the Net Mortgage Rates in effect for the Monthly Payments due on the Group I Loans during
the related Due Period, weighted on the basis of the respective Stated Principal Balances thereof for such Distribution Date, and
(b) a fraction the numerator of which is 30 and the denominator of which is the actual number of days in the related Interest Accrual
Period minus (ii) the product of (a) a fraction expressed as a percentage, the numerator of which is the amount of any Net Swap
Payments or Swap Termination Payment not due to a Swap Counterparty Trigger Event owed to the Swap Counterparty as of such
Distribution Date and the denominator of which is the aggregate Stated Principal Balance of the Group I Loans for such Distribution
Date, and (b) a fraction expressed as percentage, the numerator of which is 360 and the denominator of which is the actual number
of days in the related Interest Accrual Period.
With respect to any Distribution Date and the Group II Certificates, a per annum rate equal to the weighted average of the
Net Mortgage Rates of the Group II Loans weighted on the basis of the respective Stated Principal Balance of each such Group II Loan
as of the beginning of the related Due Period, using the Net Mortgage Rates in effect for the scheduled payments due on those
Mortgage Loans during such Due Period.
Note Margin: With respect to each Mortgage Loan, the fixed percentage set forth in the related Mortgage Note and indicated
in Exhibit 1 hereto as the “NOTE MARGIN,” which percentage is added to the Index on each Adjustment Date to determine (subject to
rounding in accordance with the related Mortgage Note, the Periodic Cap, the Maximum Mortgage Rate and the Minimum Mortgage Rate) the
interest rate to be borne by such Mortgage Loan until the next Adjustment Date.
Notional Amount: With respect to the Class I-SB Certificates or the REMIC III Regular Interest I-SB-IO, immediately prior to
any Distribution Date is equal to the aggregate of the Uncertificated Principal Balances of the REMIC II Regular Interests.
Obligation to Pay: The originally executed obligation to pay or similar agreement evidencing the obligation of the consumer
under a Sharia Mortgage Loan, together with any modification thereto.
Offered Certificates: The Class I-A Certificates and the Class I-M Certificates.
Optional Termination Date: Any Distribution Date on or after which the aggregate Stated Principal Balance (after giving
effect to distributions to be made on such Distribution Date) of the Mortgage Loans is less than 10.00% of the Cut-off Date Balance.
Overcollateralization Amount: With respect to any Distribution Date, the excess, if any, of (a) the aggregate Stated
Principal Balance of the Mortgage Loans before giving effect to distributions of principal to be made on such Distribution Date over
(b) the aggregate Certificate Principal Balance of the Class I-A, Class I-M, Class I-P and Class I-R Certificates immediately prior
to such date.
Overcollateralization Floor: An amount equal to the product of 0.50% and the Group I Cut-off Date Balance.
Overcollateralization Increase Amount: With respect to any Distribution Date, the lesser of (a) Excess Cash Flow for that
Distribution Date (to the extent not used to cover the amounts described in clauses (b)(iv), (v) and (vi) of the definition of Group
I Principal Distribution Amount as of such Distribution Date) and (b) the excess of (1) the Required Overcollateralization Amount for
such Distribution Date over (2) the Overcollateralization Amount for such Distribution Date.
Overcollateralization Reduction Amount: With respect to any Distribution Date on which the Excess Overcollateralization
Amount is, after taking into account all other distributions to be made on such Distribution Date, greater than zero, the
Overcollateralization Reduction Amount shall be equal to the lesser of (i) the Excess Overcollateralization Amount for that
Distribution Date and (ii) the Group I Principal Remittance Amount on such Distribution Date.
Pass-Through Rate: With respect to the Class of Class I-A Certificates and Class I-M Certificates and any Distribution
Date, a per annum rate equal to the lesser of (i) LIBOR plus the related Margin and (ii) the related Net WAC Cap Rate.
With respect to the Class I-SB Certificates and any Distribution Date or REMIC III Regular Interest I-SB-IO, a rate per
annum equal to the percentage equivalent of a fraction, the numerator of which is the sum of the amounts calculated pursuant to
clauses (i) through (iii) below, and the denominator of which is the aggregate principal balance of the REMIC II Regular Interests.
For purposes of calculating the Pass-Through Rate for the Class I-SB Certificates or REMIC III Regular Interest I-SB-IO, the
numerator is equal to the sum of the following components:
(i) the Uncertificated Pass-Through Rate for REMIC II Regular Interest LT1 minus the Marker Rate, applied to a notional
amount equal to the Uncertificated Principal Balance of REMIC II Regular Interest LT1;
(ii) the Uncertificated Pass-Through Rate for REMIC II Regular Interest LT2 minus the Marker Rate, applied to a notional
amount equal to the Uncertificated Principal Balance of REMIC II Regular Interest LT2; and
(iii) the Uncertificated Pass-Through Rate for REMIC II Regular Interest LT4 minus twice the Marker Rate, applied to a
notional amount equal to the Uncertificated Principal Balance of REMIC II Regular Interest LT4.
With respect to the Class II-A, Class II-M, Class II-B and Class II-R-I Certificates, the related Net WAC Cap Rate.
Periodic Cap: With respect to each Mortgage Loan, the periodic rate cap that limits the increase or the decrease of the
related Mortgage Rate on any Adjustment Date (other than the initial Adjustment Date) pursuant to the terms of the related Mortgage
Note.
Prepayment Assumption: The prepayment assumption to be used for determining the accrual of original issue discount and
premium and market discount on the Certificates for federal income tax purposes, which, with respect to the Group I Certificates,
assumes a constant prepayment rate of 30% per annum of the then outstanding principal balance of the Group I Loans, and with respect
to the Group II Certificates, assumes a constant prepayment rate of 25% per annum of the then outstanding principal balance of the
Group II Loans.
Prepayment Charge: With respect to any Mortgage Loan, the charges or premiums, if any, received in connection with a full
or partial prepayment of such Mortgage Loan in accordance with the terms thereof.
Prepayment Charge Loan: Any Mortgage Loan for which a Prepayment Charge may be assessed and to which such Prepayment Charge
the Class I-P Certificates or Class II-P Certificates, as applicable, are entitled, as indicated on the Mortgage Loan Schedule.
Prepayment Distribution Percentage: With respect to any Distribution Date and each Class of Group II Subordinate
Certificates, under the applicable circumstances set forth below, the respective percentages set forth below:
For any Distribution Date prior to the Distribution Date in July 2013 (unless the Certificate Principal Balances of
the Group II Senior Certificates have been reduced to zero or the circumstances set forth in the third paragraph of the
definition of Group II Senior Accelerated Distribution Percentage exist), 0%.
For any Distribution Date for which clause (i) above does not apply, and on which any Class of Group II
Subordinate Certificates is outstanding:
in the case of the Class of Group II Subordinate Certificates then outstanding with the Highest Priority
and each other Class of Group II Subordinate Certificates for which the related Prepayment Distribution Trigger has
been satisfied, a fraction, expressed as a percentage, the numerator of which is the Certificate Principal Balance
of such Class immediately prior to such date and the denominator of which is the sum of the Certificate Principal
Balances immediately prior to such date of (1) the Class of Group II Subordinate Certificates then outstanding with
the Highest Priority and (2) all other Classes of Group II Subordinate Certificates for which the respective
Prepayment Distribution Triggers have been satisfied; and
in the case of each other Class of Group II Subordinate Certificates for which the Prepayment
Distribution Triggers have not been satisfied, 0%; and
Notwithstanding the foregoing, if the application of the foregoing percentages on any Distribution Date as provided in
Section 4.02 of this Series Supplement (determined without regard to the proviso to the definition of “Group II Subordinate Principal
Distribution Amount”) would result in a distribution in respect of principal of any Class or Classes of Group II Subordinate
Certificates in an amount greater than the remaining Certificate Principal Balance thereof (any such class, a “Maturing Class”),
then: (a) the Prepayment Distribution Percentage of each Maturing Class shall be reduced to a level that, when applied as described
above, would exactly reduce the Certificate Principal Balance of such Class to zero; (b) the Prepayment Distribution Percentage of
each other Class of Group II Subordinate Certificates (any such Class, a “Non-Maturing Class”) shall be recalculated in accordance
with the provisions in paragraph (ii) above, as if the Certificate Principal Balance of each Maturing Class had been reduced to zero
(such percentage as recalculated, the “Recalculated Percentage”); (c) the total amount of the reductions in the Prepayment
Distribution Percentages of the Maturing Class or Classes pursuant to clause (a) of this sentence, expressed as an aggregate
percentage, shall be allocated among the Non-Maturing Classes in proportion to their respective Recalculated Percentages (the portion
of such aggregate reduction so allocated to any Non-Maturing Class, the “Adjustment Percentage”); and (d) for purposes of such
Distribution Date, the Prepayment Distribution Percentage of each Non-Maturing Class shall be equal to the sum of (1) the Prepayment
Distribution Percentage thereof, calculated in accordance with the provisions in paragraph (ii) above as if the Certificate Principal
Balance of each Maturing Class had not been reduced to zero, plus (2) the related Adjustment Percentage.
Principal Only Certificates: None.
Record Date: With respect to each Distribution Date and (a) with respect to the Class I-A Certificates and Class I-M
Certificates, the Business Day immediately prior to such Distribution Date, and (b) with respect to the Class II-A, Class II-M,
Class I-SB, Class P and Class R Certificates, the close of business on the last Business Day of the month immediately preceding the
month in which the related Distribution Date occurs.
Relief Act: The Servicemembers Civil Relief Act, as amended.
Relief Act Shortfalls: Interest shortfalls on the Mortgage Loans resulting from the Relief Act or similar legislation or
regulations.
REMIC I: The segregated pool of assets (exclusive of the Swap Account, the Swap Agreement and the SB-AM Swap Agreement),
with respect to which a REMIC election is to be made, consisting of:
(i) the Mortgage Loans in Loan Group I and the related Mortgage Files;
(ii) all payments and collections in respect of the Mortgage Loans in Loan Group I due after the Cut-off Date
(other than Monthly Payments due in the month of the Cut-off Date) as shall be on deposit in the Custodial Account or in the
Certificate Account and identified as belonging to the Trust Fund;
(iii) property which secured a Mortgage Loan in Loan Group I and which has been acquired for the benefit of the
Certificateholders by foreclosure or deed in lieu of foreclosure;
(iv) the hazard insurance policies and Primary Insurance Policies pertaining to the Mortgage Loans in Loan Group
I, if any; and
(v) all proceeds of clauses (i) through (iv) above.
REMIC I Available Distribution Amount: The Available Distribution Amount for Loan Group I increased by the amount of any
Net Swap Payment described in clause (b)(z) thereof.
REMIC I Distribution Amount: For any Distribution Date, the REMIC I Available Distribution Amount shall be distributed to
REMIC II in respect of the REMIC I Regular Interests and the Class I-R-I Certificates in the following amounts and priority:
(a) to REMIC I Regular Interest A-I and REMIC I Regular Interest I-1-A through I-60-B, pro rata, in an amount
equal to (A) Uncertificated Accrued Interest for such REMIC I Regular Interests for such Distribution Date, plus (B) any amounts
payable in respect thereof remaining unpaid from previous Distribution Dates; and
(b) to the extent of amounts remaining after the distributions made pursuant to clause (a) above, payments of
principal shall be allocated as follows: first, to REMIC I Regular Interests I-1-A through I-60-B starting with the lowest numerical
denomination until the Uncertificated Principal Balance of each such REMIC I Regular Interest is reduced to zero, provided that, for
REMIC I Regular Interests with the same numerical denomination, such payments of principal shall be allocated pro rata between such
REMIC I Regular Interests and second, to the extent of any Overcollateralization Reduction Amount to REMIC I Regular Interest A-I
until the Uncertificated Principal Balance of such REMIC I Regular Interest is reduced to zero.
REMIC I Interests: The REMIC I Regular Interests and the Class I-R-I Certificates.
REMIC I Realized Losses: All Realized Losses on the Group I Loans shall be allocated first, on each Distribution Date, to
REMIC I Regular Interest A-I until such REMIC I Regular Interest has been reduced to zero. Second, Realized Losses shall be
allocated to REMIC I Regular Interest I-1-A through REMIC I Regular Interest I-60-B, starting with the lowest numerical denomination
until such REMIC I Regular Interest has been reduced to zero, provided that, for REMIC I Regular Interests with the same numerical
denomination, such Realized Losses shall be allocated pro rata between such REMIC I Regular Interests.
REMIC I Regular Interest. Any of the separate non-certificated beneficial ownership interests in REMIC I issued hereunder
and designated as a “regular interest” in REMIC I. Each REMIC I Regular Interest shall accrue interest at the related Uncertificated
REMIC I Pass-Through Rate in effect from time to time, and shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto. The designations for the respective REMIC I Regular Interests are set forth in the Preliminary Statement hereto.
REMIC I Regular Interest A-I: A regular interest in REMIC I that is held as an asset of REMIC II, that has an initial
principal balance equal to the related Uncertificated Principal Balance, that bears interest at the related Uncertificated REMIC I
Pass-Through Rate, and that has such other terms as are described herein.
REMIC II: The segregated pool of assets subject hereto, constituting a portion of the primary trust created hereby and to
be administered hereunder, with respect to which a separate REMIC election is to be made, consisting of the REMIC I Regular Interests.
REMIC II Available Distribution Amount: For any Distribution Date, the amount distributed from REMIC I to REMIC II on such
Distribution Date in respect of the REMIC I Regular Interests.
REMIC II Distribution Amount: For any Distribution Date, the REMIC II Available Distribution Amount shall be distributed to
REMIC III in respect of the REMIC II Regular Interests and the Class I-R-II Certificates in the following amounts and priority:
(a) to REMIC II Regular Interest LT-IO, in an amount equal to (i) Uncertificated Accrued Interest for such
REMIC II Regular Interest for such Distribution Date, plus (ii) any amounts in respect thereof remaining unpaid from previous
Distribution Dates;
(b) to the extent of amounts remaining after the distributions made pursuant to clause (a) above, to REMIC II
Regular Interests LT1, LT2, LT3 and LT4, pro rata, in an amount equal to (i) their Uncertificated Accrued Interest for such
Distribution Date, plus (ii) any amounts in respect thereof remaining unpaid from previous Distribution Dates; and
(c) to the extent of amounts remaining after the distributions made pursuant to clauses (a) and (b) above:
(i) to REMIC II Regular Interests LT2, LT3 and LT4, their respective Principal
Distribution Amounts;
(ii) to REMIC II Regular Interest LT1 any remainder until the Uncertificated
Principal Balance thereof is reduced to zero;
(iii) any remainder to REMIC II Regular Interests LT2, LT3 and LT4, pro rata according
to their respective Uncertificated Principal Balances as reduced by the distributions deemed made pursuant
to (i) above, until their respective Uncertificated Principal Balances are reduced to zero; and
(d) to the extent of amounts remaining after the distributions made pursuant to clauses (a) through (c) above:
(i) first, to each of the REMIC II Regular Interests, pro rata according to the
amount of unreimbursed Realized Losses allocable to principal previously allocated to each such REMIC II
Regular Interest, the aggregate amount of any distributions to the Certificates as reimbursement of such
Realized Losses on such Distribution Date pursuant to Section 4.02(c)(I)(i)(G); provided, however, that any
amounts distributed pursuant to this paragraph (d)(i) of this definition of “REMIC II Distribution Amount”
shall not cause a reduction in the Uncertificated Principal Balances of any of the REMIC II Regular
Interests; and
(ii) second, to the Class I-R-II Certificates, any remaining amount.
REMIC II Net WAC Rate: With respect to any Distribution Date, a per annum rate equal to the weighted average of (x) with
respect to REMIC I Regular Interests ending with the designation “B,” the weighted average of the Uncertificated REMIC I Pass-Through
Rates for such REMIC I Regular Interests, weighted on the basis of the Uncertificated Principal Balance of such REMIC I Regular
Interests for each such Distribution Date, (y) with respect to REMIC I Regular Interest A-I, the Uncertificated REMIC I Pass-Through
Rate for such REMIC I Regular Interest, and (z) with respect to REMIC I Regular Interests ending with the designation “A,” for each
Distribution Date listed below, the weighted average of the rates listed below for each such REMIC I Regular Interest listed below,
weighted on the basis of the Uncertificated Principal Balance of each such REMIC I Regular Interest for each such Distribution Date:
Distribution Date REMIC I Regular Interest Rate
1 I-1-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
2 I-2-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A Uncertificated REMIC I Pass-Through Rate
3 I-3-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A and I-2-A Uncertificated REMIC I Pass-Through Rate
4 I-4-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-3-A Uncertificated REMIC I Pass-Through Rate
5 I-5-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-4-A Uncertificated REMIC I Pass-Through Rate
6 I-6-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-5-A Uncertificated REMIC I Pass-Through Rate
7 I-7-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-6-A Uncertificated REMIC I Pass-Through Rate
8 I-8-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-7-A Uncertificated REMIC I Pass-Through Rate
9 I-9-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-8-A Uncertificated REMIC I Pass-Through Rate
10 I-10-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-9-A Uncertificated REMIC I Pass-Through Rate
11 I-11-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-10-A Uncertificated REMIC I Pass-Through Rate
12 I-12-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-11-A Uncertificated REMIC I Pass-Through Rate
13 I-13-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-12-A Uncertificated REMIC I Pass-Through Rate
14 I-14-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-13-A Uncertificated REMIC I Pass-Through Rate
15 I-15-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-14-A Uncertificated REMIC I Pass-Through Rate
16 I-16-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-15-A Uncertificated REMIC I Pass-Through Rate
17 I-17-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-16-A Uncertificated REMIC I Pass-Through Rate
18 I-18-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-17-A Uncertificated REMIC I Pass-Through Rate
19 I-19-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-18-A Uncertificated REMIC I Pass-Through Rate
20 I-20-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-19-A Uncertificated REMIC I Pass-Through Rate
21 I-21-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-20-A Uncertificated REMIC I Pass-Through Rate
22 I-22-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-21-A Uncertificated REMIC I Pass-Through Rate
23 I-23-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-22-A Uncertificated REMIC I Pass-Through Rate
24 I-24-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-23-A Uncertificated REMIC I Pass-Through Rate
25 I-25-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-24-A Uncertificated REMIC I Pass-Through Rate
26 I-26-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-25-A Uncertificated REMIC I Pass-Through Rate
27 I-27-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-26-A Uncertificated REMIC I Pass-Through Rate
28 I-28-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-27-A Uncertificated REMIC I Pass-Through Rate
29 I-29-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-28-A Uncertificated REMIC I Pass-Through Rate
30 I-30-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-29-A Uncertificated REMIC I Pass-Through Rate
31 I-31-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-30-A Uncertificated REMIC I Pass-Through Rate
32 I-32-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-31-A Uncertificated REMIC I Pass-Through Rate
33 I-33-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-32-A Uncertificated REMIC I Pass-Through Rate
34 I-34-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-33-A Uncertificated REMIC I Pass-Through Rate
35 I-35-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-34-A Uncertificated REMIC I Pass-Through Rate
36 I-36-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-35-A Uncertificated REMIC I Pass-Through Rate
37 I-37-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-36-A Uncertificated REMIC I Pass-Through Rate
38 I-38-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-37-A Uncertificated REMIC I Pass-Through Rate
39 I-39-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-38-A Uncertificated REMIC I Pass-Through Rate
40 I-40-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-39-A Uncertificated REMIC I Pass-Through Rate
41 I-41-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-40-A Uncertificated REMIC I Pass-Through Rate
42 I-42-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-41-A Uncertificated REMIC I Pass-Through Rate
43 I-43-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-42-A Uncertificated REMIC I Pass-Through Rate
44 I-45-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-44-A Uncertificated REMIC I Pass-Through Rate
45 I-46-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-45-A Uncertificated REMIC I Pass-Through Rate
46 I-47-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-46-A Uncertificated REMIC I Pass-Through Rate
47 I-48-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-47-A Uncertificated REMIC I Pass-Through Rate
48 I-49-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-48-A Uncertificated REMIC I Pass-Through Rate
49 I-50-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-49-A Uncertificated REMIC I Pass-Through Rate
50 I-51-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-50-A Uncertificated REMIC I Pass-Through Rate
51 I-52-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-51-A Uncertificated REMIC I Pass-Through Rate
52 I-53-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-52-A Uncertificated REMIC I Pass-Through Rate
53 I-54-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-53-A Uncertificated REMIC I Pass-Through Rate
54 I-55-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-54-A Uncertificated REMIC I Pass-Through Rate
55 I-56-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-55-A Uncertificated REMIC I Pass-Through Rate
56 I-57-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-56-A Uncertificated REMIC I Pass-Through Rate
57 I-58-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-57-A Uncertificated REMIC I Pass-Through Rate
58 I-59-A through I-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-58-A Uncertificated REMIC I Pass-Through Rate
59 1-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-59-A Uncertificated REMIC I Pass-Through Rate
60 1-60-A 2 multiplied by Swap LIBOR, subject to a maximum rate of
Uncertificated REMIC I Pass-Through Rate
I-1-A through I-59-A Uncertificated REMIC I Pass-Through Rate
Thereafter I-1-A through I-60A Uncertificated REMIC I Pass-Through Rate
---------------------------------------------------------------------------------------------------------------------------------------
REMIC II Principal Reduction Amounts: For any Distribution Date, the amounts by which the principal balances of the
REMIC II Regular Interests LT1, LT2, LT3 and LT4, respectively will be reduced on such Distribution Date by the allocation of Realized
Losses and the distribution of principal, determined as follows:
For purposes of the succeeding formulas the following symbols shall have the meanings set forth below:
Y1 = the principal balance of the REMIC II Regular Interest LT1 after distributions on the prior Distribution Date.
Y2 = the principal balance of the REMIC II Regular Interest LT2 after distributions on the prior Distribution Date.
Y3 = the principal balance of the REMIC II Regular Interest LT3 after distributions on the prior Distribution Date.
Y4 = the principal balance of the REMIC II Regular Interest LT4 after distributions on the prior Distribution Date
(note: Y3 = Y4).
ΔY1 = the REMIC II Regular Interest LT1 Principal Reduction Amount.
ΔY2 = the REMIC II Regular Interest LT2 Principal Reduction Amount.
ΔY3 = the REMIC II Regular Interest LT3 Principal Reduction Amount.
ΔY4 = the REMIC II Regular Interest LT4 Principal Reduction Amount.
P0 = the aggregate principal balance of REMIC II Regular Interests LT1, LT2, LT3 and LT4 after distributions and the
allocation of Realized Losses on the prior Distribution Date.
P1 = the aggregate principal balance of the REMIC II Regular Interests LT1, LT2, LT3 and LT4 after distributions and the
allocation of Realized Losses to be made on such Distribution Date.
ΔP = P0 - P1 = the aggregate of the REMIC II Regular Interests LT1, LT2, LT3 and LT4 Principal Reduction Amounts.
= the aggregate of the principal portions of Realized Losses to be allocated to, and the principal distributions to be
made on, the Group I Certificates on such Distribution Date (including distributions of accrued and unpaid interest
on the Class I-SB Certificates for prior Distribution Dates).
R0 = the REMIC II Net WAC Rate (stated as a monthly rate) after giving effect to amounts distributed and Realized Losses
allocated on the prior Distribution Date.
R1 = the REMIC II Net WAC Rate (stated as a monthly rate) after giving effect to amounts to be distributed and Realized
Losses to be allocated on such Distribution Date.
α = (Y2 + Y3)/P0. The initial value of α on the Closing Date for use on the first Distribution Date
shall be 0.0001.
γ0 = the lesser of (A) the sum for all Classes of Group I Certificates other than the Class I-SB Certificates
and Class IO Certificates of the product for each Class of (i) the monthly interest rate (as limited by the REMIC II
Net WAC Rate, if applicable) for such Class applicable for distributions to be made on such Distribution Date and
(ii) the aggregate Certificate Principal Balance for such Class after distributions and the allocation of Realized
Losses on the prior Distribution Date and (B) R0*P0.
γ1 = the lesser of (A) the sum for all Classes of Group I Certificates other than the Class I-SB Certificates
and Class IO Certificates of the product for each Class of (i) the monthly interest rate (as limited by the REMIC II
Net WAC Rate, if applicable) for such Class applicable for distributions to be made on the next succeeding
Distribution Date and (ii) the aggregate Certificate Principal Balance for such Class after distributions and the
allocation of Realized Losses to be made on such Distribution Date and (B) R1*P1.
Then, based on the foregoing definitions:
ΔY1 = ΔP - ΔY2 - Y3 - Y4;
ΔY2 = (α/2){(γ0R1 - γ1R0)/R0R1};
ΔY3 = (αΔP - ΔY2; and
ΔY4 = ΔY3.
if both ΔY2 and ΔY3, as so determined, are non-negative numbers. Otherwise:
(1) If ΔY2, as so determined, is negative, then
ΔY2 = 0
ΔY3 = α{γ1R0P0 - γ0R1P1}/{γ1R0};
ΔY4 = ΔY3; and
ΔY1 = ΔP - ΔY2 - ΔY3 - ΔY4.
(2) If ΔY3, as so determined, is negative, then
ΔY3 = 0;
ΔY2 = α{γ0R1P1 - γ1R0P0}/{2R1R0P1 - γ1R0};
ΔY4 = ΔY3; and
ΔY1 = ΔP - ΔY2 - ΔY3 - ΔY4.
REMIC II Realized Losses: Realized Losses on the Group I Loans shall be allocated to the REMIC II Regular Interests as
follows. The interest portion of Realized Losses on the Group I Loans, if any, shall be allocated among REMIC II Regular Interests
LT1, LT2 and LT4, pro rata according to the amount of interest accrued but unpaid thereon, in reduction thereof. Any interest
portion of such Realized Losses in excess of the amount allocated pursuant to the preceding sentence shall be treated as a principal
portion of Realized Losses not attributable to any specific Group I Loan and allocated pursuant to the succeeding sentences. The
principal portion of Realized Losses with respect to Group I Loans shall be allocated to the REMIC II Regular Interests as follows:
first, to REMIC II Regular Interests LT2, LT3 and LT4, pro-rata according to their respective REMIC II Principal Reduction Amounts to
the extent thereof in reduction of the Uncertificated Principal Balance of such REMIC II Regular Interests and, second, the
remainder, if any, of such principal portion of such Realized Losses shall be allocated to REMIC II Regular Interest LT1 in reduction
of the Uncertificated Principal Balance thereof.
REMIC II Regular Interests: REMIC II Regular Interest LT1, REMIC II Regular Interest LT2, REMIC II Regular Interest LT3,
REMIC II Regular Interest LT4 and REMIC II Regular Interest LT-IO.
REMIC II Regular Interest LT1: A regular interest in REMIC II that is held as an asset of REMIC III, that has an initial
principal balance equal to the related Uncertificated Principal Balance, that bears interest at the related Uncertificated REMIC II
Pass-Through Rate, and that has such other terms as are described herein.
REMIC II Regular Interest LT1 Principal Distribution Amount: For any Distribution Date, the excess, if any, of the REMIC II
Regular Interest LT1 Principal Reduction Amount for such Distribution Date over the Realized Losses allocated to the REMIC II Regular
Interest LT1 on such Distribution Date.
REMIC II Regular Interest LT2: A regular interest in REMIC II that is held as an asset of REMIC III, that has an initial
principal balance equal to the related Uncertificated Principal Balance, that bears interest at the related Uncertificated REMIC II
Pass-Through Rate, and that has such other terms as are described herein.
REMIC II Regular Interest LT2 Principal Distribution Amount: For any Distribution Date, the excess, if any, of the REMIC II
Regular Interest LT2 Principal Reduction Amount for such Distribution Date over the Realized Losses allocated to the REMIC II Regular
Interest LT2 on such Distribution Date.
REMIC II Regular Interest LT3: A regular interest in REMIC II that is held as an asset of REMIC III, that has an initial
principal balance equal to the related Uncertificated Principal Balance, that bears interest at the related Uncertificated REMIC II
Pass-Through Rate, and that has such other terms as are described herein.
REMIC II Regular Interest LT3 Principal Distribution Amount: For any Distribution Date, the excess, if any, of the REMIC II
Regular Interest LT3 Principal Reduction Amount for such Distribution Date over the Realized Losses allocated to the REMIC II Regular
Interest LT3 on such Distribution Date.
REMIC II Regular Interest LT4: A regular interest in REMIC II that is held as an asset of REMIC III, that has an initial
principal balance equal to the related Uncertificated Principal Balance, that bears interest at the related Uncertificated REMIC II
Pass-Through Rate, and that has such other terms as are described herein.
REMIC II Regular Interest LT4 Principal Distribution Amount: For any Distribution Date, the excess, if any, of the REMIC II
Regular Interest LT4 Principal Reduction Amount for such Distribution Date over the Realized Losses allocated to the REMIC II Regular
Interest LT4 on such Distribution Date.
REMIC II Regular Interest LT-IO: A regular interest in REMIC II that is held as an asset of REMIC III, that has no initial
principal balance, that bears interest at the related Uncertificated REMIC II Pass-Through Rate on its Uncertificated Notional
Amount, and that has such other terms as are described herein.
REMIC III: The segregated pool of assets subject hereto, constituting a portion of the primary trust created hereby and to
be administered hereunder, with respect to which a separate REMIC election is to be made, consisting of the REMIC II Regular
Interests.
REMIC III Available Distribution Amount: For any Distribution Date, the amount distributed from REMIC II to REMIC III on
such Distribution Date in respect of the REMIC II Regular Interests.
REMIC III Distribution Amount: For any Distribution Date, the REMIC III Available Distribution Amount shall be deemed
distributed to Class I-A, Class I-M and Class I-SB Certificates in respect of the portion of such Certificates representing ownership
of REMIC III Regular Interests and the Class I-R- III Certificates in the following amounts and priority:
(i) to the Class I-SB Certificateholders in respect of REMIC III Regular Interest IO, the amount distributable with
respect to such REMIC III Regular Interest as described in the Preliminary Statement, being paid from and in reduction of the
REMIC III Available Distribution Amount for such Distribution Date;
(ii) to the Class I-A Certificateholders, the Accrued Certificate Interest payable on the Class I-A Certificates with
respect to such Distribution Date, plus any related amounts accrued pursuant to this clause (i) but remaining unpaid from any prior
Distribution Date, being paid from and in reduction of the REMIC III Available Distribution Amount for such Distribution Date;
(iii) to the Class I-M Certificateholders, from the amount, if any, of the Available Distribution Amount remaining after
the foregoing distributions, Accrued Certificate Interest payable on the Class I-M Certificates with respect to such Distribution
Date, plus any related amounts accrued pursuant to this clause (ii) but remaining unpaid from any prior Distribution Date,
sequentially, to the Class I-M-1 Certificateholders, Class I-M-2 Certificateholders, Class I-M-3 Certificateholders, Class I-M-4
Certificateholders, Class I-M-5 Certificateholders, Class I-M-6 Certificateholders, Class I-M-7 Certificateholders, Class I-M-8
Certificateholders and Class I-M-9 Certificateholders, in that order, being paid from and in reduction of the REMIC III Available
Distribution Amount for such Distribution Date;
(iv) the Principal Distribution Amount shall be distributed as follows, to be applied to reduce the principal balance of
the REMIC III Regular Interest related to the applicable Certificates in each case to the extent of the remaining Principal
Distribution Amount:
(A) first, the Class I-A Principal Distribution Amount shall be distributed to the Class I-A Certificateholders
as follows (i) 47.1434557899% of such amount shall be distributed to the Class I-A-1 Certificates until the Certificate
Principal Balance thereof has been reduced to zero, and (ii) 52.8565442101% of such amount shall be distributed to the Class
I-A-2 Certificates and Class I-A-3 Certificates, on a pro rata basis in accordance with their respective Certificate Principal
Balances, until the Certificate Principal Balances thereof have been reduced to zero; provided, however, that if a Sequential
Trigger is in effect, such amount shall be distributed first, to the Class I-A-2 Certificates until the Certificate Principal
Balance thereof has been reduced to zero, and second, to the Class I-A-3 Certificates until the Certificate Principal Balance
thereof has been reduced to zero;
(B) second, to the Class I-M-1 Certificateholders, the Class I-M-1 Principal Distribution Amount, until the
Certificate Principal Balance of the Class I-M-1 Certificates has been reduced to zero;
(C) third, to the Class I-M-2 Certificateholders, the Class I-M-2 Principal Distribution Amount, until the
Certificate Principal Balance of the Class I-M-2 Certificates has been reduced to zero;
(D) fourth, to the Class I-M-3 Certificateholders, the Class I-M-3 Principal Distribution Amount, until the
Certificate Principal Balance of the Class I-M-3 Certificates has been reduced to zero;
(E) fifth, to the Class I-M-4 Certificateholders, the Class I-M-4 Principal Distribution Amount, until the
Certificate Principal Balance of the Class I-M-4 Certificates has been reduced to zero;
(F) sixth, to the Class I-M-5 Certificateholders, the Class I-M-5 Principal Distribution Amount, until the
Certificate Principal Balance of the Class I-M-5 Certificates has been reduced to zero;
(G) seventh, to the Class I-M-6 Certificateholders, the Class I-M-6 Principal Distribution Amount, until the
Certificate Principal Balance of the Class I-M-6 Certificates has been reduced to zero;
(H) eighth, to the Class I-M-7 Certificateholders, the Class I-M-7 Principal Distribution Amount, until the
Certificate Principal Balance of the Class I-M-7 Certificates has been reduced to zero;
(I) ninth, to the Class I-M-8 Certificateholders, the Class I-M-8 Principal Distribution Amount, until the
Certificate Principal Balance of the Class I-M-8 Certificates has been reduced to zero; and
(J) tenth, to the Class I-M-9 Certificateholders, the Class I-M-9 Principal Distribution Amount, until the
Certificate Principal Balance of the Class I-M-9 Certificates has been reduced to zero;
(v) to the Class I-A Certificateholders and Class I-M Certificateholders, the amount of any Prepayment Interest
Shortfalls allocated thereto for such Distribution Date, on a pro rata basis based on Prepayment Interest Shortfalls allocated
thereto to the extent not offset by Eligible Master Servicing Compensation on such Distribution Date;
(vi) to the Class I-A Certificateholders and Class I-M Certificateholders, the amount of any Prepayment Interest
Shortfalls previously allocated thereto remaining unpaid from prior Distribution Dates together with interest thereon at the related
Pass Through Rate, on a pro rata basis based on unpaid Prepayment Interest Shortfalls previously allocated thereto;
(vii) to the Class I-SB Certificates, from the amount, if any, of the REMIC III Available Distribution Amount remaining
after the foregoing distributions, the sum of (I) Accrued Certificate Interest thereon, (II) the amount of any Overcollateralization
Reduction Amount for such Distribution Date and (III) for any Distribution Date after the Certificate Principal Balance of each Class
of Class I-A Certificates and Class I-M Certificates has been reduced to zero, the Overcollateralization Amount; and
(viii) to the Class I-R-III Certificateholders, the balance, if any, of the REMIC III Available Distribution Amount.
REMIC III Regular Interest I-SB-PO: A separate non-certificated beneficial ownership interests in XXXXX XXX issued
hereunder and designated as a Regular Interest in REMIC III. REMIC III Regular Interest I-SB-PO shall have no entitlement to
interest, and shall be entitled to distributions of principal subject to the terms and conditions hereof, in aggregate amount equal
to the initial Certificate Principal Balance of the Class I-SB Certificates as set forth in the Preliminary Statement hereto.
REMIC III Regular Interest I-SB-IO: A separate non-certificated beneficial ownership interests in XXXXX XXX issued
hereunder and designated as a Regular Interest in REMIC III. REMIC III Regular Interest I-SB-IO shall have no entitlement to
principal, and shall be entitled to distributions of interest subject to the terms and conditions hereof, in aggregate amount equal
to the interest distributable with respect to the Class I-SB Certificates pursuant to the terms and conditions hereof.
REMIC III Regular Interest IO: A separate non-certificated beneficial ownership interests in REMIC III issued hereunder and
designated as a Regular Interest in REMIC III. REMIC III Regular Interest IO shall have no entitlement to principal, and shall be
entitled to distributions of interest subject to the terms and conditions hereof, in aggregate amount equal to the interest
distributable with respect to REMIC II Regular Interest LT-IO.
REMIC III Regular Interests: REMIC III Regular Interests I-SB-IO, I-SB-PO and IO, together with the Class I-A Certificates
and Class I-M Certificates exclusive of their respective rights to receive the payment of Basis Risk Shortfalls and other amounts
pursuant to the Swap Agreement and SB-AM Swap Agreement.
REMIC IV: The segregated pool of assets, with respect to which a REMIC election is to be made, consisting of:
(i) the Mortgage Loans in Loan Group II and the related Mortgage Files;
(ii) all payments and collections in respect of the Mortgage Loans in Loan Group II due after the Cut-off Date
(other than Monthly Payments due in the month of the Cut-off Date) as shall be on deposit in the Custodial Account or in the
Certificate Account and identified as belonging to the Trust Fund;
(iii) property which secured a Mortgage Loan in Loan Group II and which has been acquired for the benefit of the
Certificateholders by foreclosure or deed in lieu of foreclosure;
(iv) the hazard insurance policies and Primary Insurance Policies pertaining to the Mortgage Loans in Loan Group
II, if any; and
(v) all proceeds of clauses (i) through (iv) above.
REMIC IV Regular Interests: The Class II-A, Class II-M and Class II-B Certificates.
Required Overcollateralization Amount: With respect to any Distribution Date and the Class I-A Certificates and Class I-M
Certificates, (i) prior to the Stepdown Date, an amount equal to 1.00% of the aggregate Stated Principal Balance of the Mortgage
Loans in Loan Group I as of the Cut-off Date, and (ii) on or after the Stepdown Date, the greater of (i) an amount equal to 2.00% of
the aggregate outstanding Stated Principal Balance of the Mortgage Loans in Loan Group I after giving effect to distributions made on
that Distribution Date and (ii) the Overcollateralization Floor; provided, however, that if a Trigger Event is in effect, the
Required Overcollateralization Amount will be an amount equal to the Required Overcollateralization Amount from the immediately
preceding Distribution Date; provided, further, that the Required Overcollateralization Amount may be reduced so long as written
confirmation is obtained from each Rating Agency that the reduction will not reduce the rating assigned to any class of certificates
by that Rating Agency below the lower of the then current rating assigned to those certificates by that Rating Agency or the rating
assigned to those certificates as of the Closing Date by that Rating Agency.
Rule 144A: Rule 144A under the Securities Act of 1933, as in effect from time to time.
SB-AM Swap Agreement: The interest rate swap agreement between the Trustee, on behalf of the Class I-A Certificateholders
and Class I-M Certificateholders, and the Trustee, on behalf of the Class I-SB Certificateholders, evidenced by the confirmation
attached hereto as Exhibit 5 and incorporated herein by reference.
Senior Enhancement Percentage: With respect to any Distribution Date, the percentage obtained by dividing (x) the sum of
(i) the aggregate Certificate Principal Balance of the Class I-M Certificates and (ii) the Overcollateralization Amount, in each case
prior to the distribution of the Principal Distribution Amount on such Distribution Date, by (y) the aggregated Stated Principal
Balance of the Mortgage Loans in Loan Group I after giving effect to distributions to be made on that Distribution Date.
Senior Support Certificates: Any of the Class II-A-2 Certificates.
Sequential Trigger Event: With respect to the Group I Certificates, a Sequential Trigger Event is in effect (a) with
respect to any Distribution Date occurring before July 2008, if the aggregate amount of Realized Losses on the Mortgage Loans in Loan
Group I incurred since the Cut-off Date through the last day of the related Prepayment Period divided by the aggregate Stated
Principal Balance as of the Cut-off Date exceeds 0.20% and (b) with respect to any Distribution Date occurring on or after July 2008,
if a Trigger Event is in effect.
Sharia Mortgage Loan: A declining balance co-ownership transaction, structured so as to comply with Islamic religious law.
Sharia Mortgage Loan Co-Ownership Agreement: The agreement that defines the relationship between the consumer and co-owner
and the parties’ respective rights under a Sharia Mortgage Loan, including their respective rights with respect to the indicia of
ownership of the related Mortgaged Property.
Sharia Mortgage Loan Security Instrument: The mortgage, security instrument or other comparable instrument creating a first
lien on an estate in fee simple or leasehold interest in real property securing an Obligation to Pay.
Sixty-Plus Delinquency Percentage: With respect to any Distribution Date on or after the Stepdown date and the Group I
Certificates, the arithmetic average, for each of the three consecutive Distribution Dates ending with such Distribution Date, of the
fraction, expressed as a percentage, equal to (x) the aggregate Stated Principal Balance of the Mortgage Loans in Loan Group I that
are 60 or more days delinquent in payment of principal and interest for that Distribution Date, including Mortgage Loans in Loan
Group I in foreclosure, and REO Properties over (y) the aggregate Stated Principal Balance of all of the Mortgage Loans in Loan Group
I immediately preceding that Distribution Date.
Special Hazard Amount: With respect to the Group II Certificates, as of any Distribution Date, an amount equal to $2,960,000
minus the sum of (i) the aggregate amount of Special Hazard Losses allocated solely to one or more specific Classes of Group II
Certificates in accordance with Section 4.05 of this Series Supplement and (ii) the Adjustment Amount (as defined below) as most
recently calculated. For each anniversary of the Cut-off Date, the Adjustment Amount shall be equal to the amount, if any, by which
the amount calculated in accordance with the preceding sentence (without giving effect to the deduction of the Adjustment Amount for
such anniversary) exceeds the greater of (A) the greater of (i) the product of the Special Hazard Percentage for such anniversary
multiplied by the outstanding principal balance of all the Group II Loans on the Distribution Date immediately preceding such
anniversary and (ii) twice the outstanding principal balance of the Group II Loans with the largest outstanding principal balance as
of the Distribution Date immediately preceding such anniversary and (B) the greatest of (i) twice the outstanding principal balance
of the Group II Loans which has the largest outstanding principal balance on the Distribution Date immediately preceding such
anniversary, (ii) the product of 1.00% multiplied by the outstanding principal balance of all Group II Loans on the Distribution Date
immediately preceding such anniversary and (iii) the aggregate outstanding principal balance (as of the immediately preceding
Distribution Date) of the Group II Loans in any single five-digit California zip code area with the largest amount of Group II Loans
by aggregate principal balance as of such anniversary.
The Special Hazard Amount may be further reduced by the Master Servicer (including accelerating the manner in which coverage
is reduced) provided that prior to any such reduction, the Master Servicer shall (i) obtain written confirmation from each Rating
Agency that such reduction shall not reduce the rating assigned to any Class of Group II Certificates by such Rating Agency below the
lower of the then-current rating or the rating assigned to such Certificates as of the Closing Date by such Rating Agency and (ii)
provide a copy of such written confirmation to the Trustee.
Special Hazard Percentage: With respect to the Group II Certificates, as of each anniversary of the Cut-off Date, the
greater of (i) 1.0% and (ii) the largest percentage obtained by dividing the aggregate outstanding principal balance (as of
immediately preceding Distribution Date) of the Group II Loans secured by Mortgaged Properties located in a single, five-digit zip
code area in the State of California by the outstanding principal balance of all the Group II Loans as of the immediately preceding
Distribution Date.
Stated Principal Balance: With respect to any Mortgage Loan or related REO Property, as of any date of determination,
(i) the sum of (a) the Cut-off Date Principal Balance of the Mortgage Loan plus (b) any amount by which the Stated Principal Balance
of the Mortgage Loan has been increased pursuant to a Servicing Modification, 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 with the Due Period relating to
the most recent Distribution Date which were received or with respect to which an 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 Master Servicer as recoveries of principal in accordance with Section 3.14 with respect to such Mortgage Loan or REO
Property, in each case which were distributed pursuant to Section 4.02 on any previous Distribution Date, and (c) any Realized Loss
incurred with respect to such Mortgage Loan allocated to Certificateholders with respect thereto for any previous Distribution Date.
Stepdown Date: The earlier to occur of (x) date on which the Certificate Principal Balance of the Class I-A Certificates is
reduced to zero and (y) the later to occur of (i) the Distribution Date in July 2009 and (ii) the first Distribution Date on which
the Senior Enhancement Percentage (calculated for this purpose only after taking into account payments of principal on the Mortgage
Loans in Loan Group I due on the related Due Date or received during the related Prepayment Period but prior to distribution of the
Group I Principal Distribution Amount in respect of the certificates then entitled to distributions of principal on such Distribution
Date) is greater than or equal to approximately 12.90%..
Super Senior Certificates: Any of the Class II-A-1 Certificates.
Swap Account: The separate trust account created and maintained by the Trustee pursuant to Section 4.09(a).
Swap Agreement: The interest rate swap agreement between the Swap Counterparty and the Trustee, on behalf of the Trust,
which agreement provides for Net Swap Payments and Swap Termination Payments to be paid, as provided therein, together with any
schedules, confirmations or other agreements relating thereto, attached hereto as Exhibit 4.
Swap Agreement Notional Balance: As to the Swap Agreement and each Floating Rate Payer Payment Date and Fixed Rate Payer
Payment Date (each as defined in the Swap Agreement) the amount set forth on Schedule I to the Swap Agreement for such Floating Rate
Payer Payment Date and Fixed Rate Payer Payment Date.
Swap Counterparty: The swap counterparty under the Swap Agreement either (a) entitled to receive payments from the Trustee
from amounts payable by the Trust Fund under this Agreement or (b) required to make payments to the Trustee for payment to the Trust
Fund, in either case pursuant to the terms of the Swap Agreement, and any successor in interest or assign. Initially, the Swap
Counterparty shall be Xxxxxx Xxxxxxx Capital Services Inc.
Swap Counterparty Trigger Event: With respect to any Distribution Date, (i) an Event of Default under the Swap Agreement
with respect to which the Swap Counterparty is a Defaulting Party, (ii) a Termination Event under the Swap Agreement with respect to
which the Swap Counterparty is the sole Affected Party, or (iii) an additional termination event under the Swap Agreement with
respect to which the Swap Counterparty is the sole Affected Party.
Swap LIBOR: LIBOR as determined pursuant to the Swap Agreement.
Swap Payment Allocation: For any Class of Group I Certificates and any Distribution Date, that Class’s pro rata share of
any Net Swap Payment available after allocation of such Net Swap Payment pursuant to clauses (A) through (E) of Section 4.09(c) for
that Distribution Date, based on the respective Certificate Principal Balances of the Group I Certificates.
Swap Termination Payment: Upon the occurrence of an Early Termination Date, the payment to be made by the Trustee on behalf
of the Trust to the Swap Counterparty from payments from the Trust Fund, or by the Swap Counterparty to the Trustee for payment to
the Trust Fund, as applicable, pursuant to the terms of the Swap Agreement.
Trigger Event: With respect to the Group I Certificates, a Trigger Event is in effect with respect to any Distribution Date
on or after the Stepdown Date if either (a) the Sixty-Plus Delinquency Percentage, as determined on that Distribution Date exceeds
40.00% of the Senior Enhancement Percentage for that Distribution Date or (b) the aggregate amount of Realized Losses on the Mortgage
Loans in Loan Group I as a percentage of the initial aggregate Stated Principal Balance of the Group I Loans as of the Cut-off Date
exceeds the applicable amount set forth below:
o July 2008 to June 2009: 0.20% with respect to July 2008, plus an additional 1/12th of 0.35% for each month through June 2009.
o July 2009 to June 2010: 0.55% with respect to July 2009, plus an additional 1/12th of 0.40% for each month through June 2010.
o July 2010 to June 2011: 0.95% with respect to July 2010, plus an additional 1/12th of 0.40% for each month through June 2011.
o July 2011 to June 2012: 1.35% with respect to July 2011, plus an additional 1/12th of 0.25% for each month through June 2012.
o July 2012 and thereafter: 1.60%
Uncertificated Accrued Interest: With respect to any Uncertificated REMIC Regular Interest for any Distribution Date, one
month’s interest at the related Uncertificated Pass-Through Rate for such Distribution Date, accrued on the Uncertificated Principal
Balance or Uncertificated Notional Amount, as applicable, immediately prior to such Distribution Date. Uncertificated Accrued
Interest for the Uncertificated REMIC Regular Interests shall accrue on the basis of a 360-day year consisting of twelve 30-day
months. For purposes of calculating the amount of Uncertificated Accrued Interest for the REMIC I Regular Interests for any
Distribution Date, any Prepayment Interest Shortfalls and Relief Act Shortfalls (to the extent not covered by Compensating Interest)
shall be allocated among REMIC I Regular Interests, pro rata, based on, and to the extent of, Uncertificated Accrued Interest, as
calculated without application of this sentence. For purposes of calculating the amount of Uncertificated Accrued Interest for the
REMIC II Regular Interests for any Distribution Date, any Prepayment Interest Shortfalls and Relief Act Shortfalls (to the extent not
covered by Compensating Interest) shall be allocated among the REMIC II Regular Interests, pro rata, based on, and to the extent of,
Uncertificated Accrued Interest, as calculated without application of this sentence. Uncertificated Accrued Interest on REMIC III
Regular Interest I-SB-PO shall be zero. Uncertificated Accrued Interest on the REMIC III Regular Interest I-SB-IO for each
Distribution Date shall equal Accrued Certificate Interest for the Class I-SB Certificates.
Uncertificated Notional Amount: With respect to the Class I-SB Certificates or REMIC III Regular Interest I-SB-IO,
immediately prior to any Distribution Date, the aggregate of the Uncertificated Principal Balances of the REMIC II Regular Interests.
With respect to REMIC II Regular Interest LT-IO and each Distribution Date listed below, the aggregate Uncertificated
Principal Balance of the REMIC I Regular Interests ending with the designation “A” listed below:
Distribution Date REMIC I Regular Interests
1 I-1-A through I-60-A
2 I-2-A through I-60-A
3 I-3-A through I-60-A
4 I-4-A through I-60-A
5 I-5-A through I-45A
6 I-6-A through I-60-A
7 I-7-A through I-60-A
8 I-8-A through I-60-A
9 I-9-A through I-60-A
10 I-10-A through I-60-A
11 I-11-A through I-60-A
12 I-12-A through I-60-A
13 I-13-A through I-60-A
14 I-14-A through I-60-A
15 I-15-A through I-60-A
16 I-16-A through I-60-A
17 I-17-A through I-60-A
18 I-18-A through I-60-A
19 I-19-A through I-60-A
20 I-20-A through I-60-A
21 I-21-A through I-60-A
22 I-22-A through I-60-A
23 I-23-A through I-60-A
24 I-24-A through I-60-A
25 I-25-A through I-60-A
26 I-26-A through I-60-A
27 I-27-A through I-60-A
28 I-28-A through I-60-A
29 I-29-A through I-60-A
30 I-30-A through I-60-A
31 I-31-A through I-60-A
32 I-32-A through I-60-A
33 I-33-A through I-60-A
34 I-34-A through I-60-A
35 I-35-A through I-60-A
36 I-36-A through I-60-A
37 I-37-A through I-60-A
38 I-38-A through I-60-A
39 I-39-A through I-60-A
40 I-40-A through I-60-A
41 I-41-A through I-60-A
42 I-42-A through I-60-A
43 I-43-A through I-60-A
44 I-45-A through I-60-A
45 I-46-A through I-60-A
46 I-47-A through I-60-A
47 I-48-A through I-60-A
48 I-49-A through I-60-A
49 I-50-A through I-60-A
50 I-51-A through I-60-A
51 I-52-A through I-60-A
52 I-53-A through I-60-A
53 I-54-A through I-60-A
54 I-55-A through I-60-A
55 I-56-A through I-60-A
56 I-57-A through I-60-A
57 I-58-A through I-60-A
58 I-59-A through I-60-A
59 I-60-A
60 I-60-A
thereafter $0.00
With respect to REMIC III Regular Interest IO, immediately prior to any Distribution Date, an amount equal to the
Uncertificated Notional Amount of REMIC II Regular Interest LT-IO.
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Uncertificated Pass-Through Rate: The Uncertificated REMIC I Pass-Through Rate or the Uncertificated REMIC II Pass-Through
Rate, as applicable
Uncertificated Principal Balance: The principal amount of any Uncertificated Regular Interest outstanding as of any date of
determination. The Uncertificated Principal Balance of each Uncertificated Regular Interest shall be reduced first by Realized
Losses allocated thereto by the definition of REMIC I Realized Losses or REMIC II Realized Losses, as applicable, and by all
distributions of principal deemed made on such Uncertificated Regular Interest on such Distribution Date. The Uncertificated
Principal Balance of each Uncertificated Regular Interest shall never be less than zero. With respect to REMIC III Regular Interest
I-SB-PO the initial amount set forth with respect thereto in the Preliminary Statement as reduced by distributions deemed made in
respect thereof pursuant to Section 4.02 and Realized Losses allocated thereto pursuant to Section 4.05.
Uncertificated REMIC Regular Interests: The REMIC I Regular Interests and the REMIC II Regular Interests.
Uncertificated REMIC I Pass-Through Rate: With respect to each REMIC I Regular Interest ending with the designation “A”, a
per annum rate equal to the weighted average Net Mortgage Rate of the Group I Loans multiplied by two (2), subject to a maximum rate
of 11.18%. With respect to each REMIC I Regular Interest ending with the designation “B”, the greater of (x) a per annum rate equal
to the excess, if any, of (i) 2 multiplied by the weighted average Net Mortgage Rate of the Group I Loans over (ii) 11.18% and (y)
0.00000%. With respect to REMIC I Regular Interest A-I, the weighted average Net Mortgage Rate of the Group I Loans.
Uncertificated REMIC II Pass-Through Rate: With respect to any Distribution Date and (i) REMIC II Regular Interests LT1 and
LT2, the REMIC II Net WAC Rate, (ii) REMIC II Regular Interest LT3, zero (0.00%), (iii) REMIC II Regular Interest LT4, twice the
REMIC II Net WAC Rate, and (iv) REMIC II Regular Interest LT-IO, the excess of (i) the weighted average of the Uncertificated REMIC I
Pass-Through Rates for REMIC I Regular Interests ending with the designation “A”, over (ii) 2 multiplied by Swap LIBOR.
Underwriter: Xxxxxx Xxxxxxx & Co. Incorporated.
Section 1.02. Determination of LIBOR.
LIBOR applicable to the calculation of the Pass-Through Rate on the LIBOR Certificates for any Interest Accrual Period will
be determined as of each LIBOR Rate Adjustment Date. On each LIBOR Rate Adjustment Date, or if such LIBOR Rate Adjustment Date is
not a Business Day, then on the next succeeding Business Day, LIBOR shall be established by the Trustee and, as to any Interest
Accrual Period, will equal the rate for one month United States dollar deposits that appears on the Dow Xxxxx Telerate Screen Page
3750 as of 11:00 a.m., London time, on such LIBOR Rate Adjustment Date. “Dow Xxxxx Telerate Screen Page 3750” means 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). If such rate does not appear on such page (or such other page as may
replace that page on that service, or if such service is no longer offered, LIBOR shall be so established by use of such other
service for displaying LIBOR or comparable rates as may be selected by the Trustee after consultation with the Master Servicer), the
rate will be the Reference Bank Rate. The “Reference Bank Rate” will be determined on the basis of the rates at which deposits in
U.S. Dollars are offered by the reference banks (which shall be any three major banks that are engaged in transactions in the London
interbank market, selected by the Trustee after consultation with the Master Servicer) as of 11:00 a.m., London time, on the LIBOR
Rate Adjustment Date to prime banks in the London interbank market for a period of one month in amounts approximately equal to the
aggregate Certificate Principal Balance of the LIBOR Certificates then outstanding. The Trustee will request the principal
placeCityLondon office of each of the reference banks to provide a quotation of its rate. If at least two such quotations are
provided, the rate will be the arithmetic mean of the quotations rounded up to the next multiple of 1/16%. If on such date fewer
than two quotations are provided as requested, the rate will be the arithmetic mean of the rates quoted by one or more major banks in
New York City, selected by the Trustee after consultation with the Master Servicer, as of 11:00 a.m., New York City time, on such
date for loans in U.S. Dollars to leading European banks for a period of one month in amounts approximately equal to the aggregate
Certificate Principal Balance of the LIBOR Certificates then outstanding. If no such quotations can be obtained, the rate will be
LIBOR for the prior Distribution Date; provided however, if, under the priorities described above, LIBOR for a Distribution Date
would be based on LIBOR for the previous Distribution Date for the third consecutive Distribution Date, the Trustee, after
consultation with the Master Servicer, shall select an alternative comparable index (over which the Trustee has no control), used for
determining one-month Eurodollar lending rates that is calculated and published (or otherwise made available) by an independent
party.
The establishment of LIBOR by the Trustee and the Master Servicer on any LIBOR Rate Adjustment Date and the Master
Servicer’s subsequent calculation of the Pass-Through Rate applicable to the LIBOR Certificates for the relevant Interest Accrual
Period, in the absence of manifest error, will be final and binding.
Promptly following each LIBOR Rate Adjustment Date the Trustee shall supply the Master Servicer with the results of its
determination of LIBOR on such date. Furthermore, the Trustee will supply to any Certificateholder so requesting by telephone by
calling (000) 000-0000 the Pass-Through Rate on the LIBOR Certificates for the current and the immediately preceding Interest Accrual
Period.
Section 1.03. Use of Words and Phrases.
“Herein,” “hereby,” “hereunder,” “hereof,” “hereinbefore,” “hereinafter” and other equivalent words refer to the Pooling and
Servicing Agreement as a whole. All references herein to Articles, Sections or Subsections shall mean the corresponding Articles,
Sections and Subsections in the Pooling and Servicing Agreement. The definitions set forth herein include both the singular and the
plural.
References in the Pooling and Servicing Agreement to “interest” on and “principal” of the Mortgage Loans shall mean, with
respect to the Sharia Mortgage Loans, amounts in respect profit payments and acquisition payments, respectively.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01. Conveyance of Mortgage Loans. (See Section 2.01 of the Standard Terms)
(a) (See Section 2.01(a) of the Standard Terms).
(b) In connection with such assignment, except as set forth in Section 2.01(c) and subject to Section 2.01(d)
below, the Company does hereby deliver to, and deposit with, the Trustee, or to and with one or more Custodians, as the duly
appointed agent or agents of the Trustee for such purpose, the following documents or instruments (or copies thereof as permitted by
this Section) (I) with respect to each Mortgage Loan so assigned (other than a Cooperative Loan or a Sharia Mortgage Loan):
(i) The original Mortgage Note, endorsed without recourse in blank or to the order of the Trustee, and
showing an unbroken chain of endorsements from the originator thereof to the Person endorsing it to the Trustee, or with respect to
any Destroyed Mortgage Note, an original lost note affidavit from the related Seller or Residential Funding stating that the original
Mortgage Note was lost, misplaced or destroyed, together with a copy of the related Mortgage Note;
(ii) The original Mortgage, noting the presence of the MIN of the Mortgage Loan and language indicating
that the Mortgage Loan is a MOM Loan if the Mortgage Loan is a MOM Loan, with evidence of recording indicated thereon or a copy of
the Mortgage with evidence of recording indicated thereon;
(iii) Unless the Mortgage Loan is registered on the MERSreg; System, an original Assignment of the Mortgage
to the Trustee with evidence of recording indicated thereon or a copy of such assignment with evidence of recording indicated thereon;
(iv) The original recorded assignment or assignments of the Mortgage showing an unbroken chain of title
from the originator thereof to the Person assigning it to the Trustee (or to MERS, if the Mortgage Loan is registered on the MERSreg;
System and noting the presence of a MIN) with evidence of recordation noted thereon or attached thereto, or a copy of such assignment
or assignments of the Mortgage with evidence of recording indicated thereon; and
(v) The original of each modification, assumption agreement or preferred loan agreement, if any,
relating to such Mortgage Loan or a copy of each modification, assumption agreement or preferred loan agreement.
(II) with respect to each Cooperative Loan so assigned:
(i) The original Mortgage Note, endorsed without recourse to the order of the Trustee and showing an unbroken
chain of endorsements from the originator thereof to the Person endorsing it to the Trustee, or with respect to any Destroyed
Mortgage Note, an original lost note affidavit from the related Seller or Residential Funding stating that the original Mortgage Note
was lost, misplaced or destroyed, together with a copy of the related Mortgage Note;
(ii) A counterpart of the Cooperative Lease and the Assignment of Proprietary Lease to the originator of the
Cooperative Loan with intervening assignments showing an unbroken chain of title from such originator to the Trustee;
(iii) The related Cooperative Stock Certificate, representing the related Cooperative Stock pledged with respect
to such Cooperative Loan, together with an undated stock power (or other similar instrument) executed in blank or a copy thereof;
(iv) The original recognition agreement by the Cooperative of the interests of the mortgagee with respect to the
related Cooperative Loan or a copy thereof;
(v) The Security Agreement or a copy thereof;
(vi) Copies of the original UCC-1 financing statement, and any continuation statements, filed by the originator
of such Cooperative Loan as secured party, each with evidence of recording thereof, evidencing the interest of the originator under
the Security Agreement and the Assignment of Proprietary Lease;
(vii) Copies of the filed UCC-3 assignments of the security interest referenced in clause (vi) above showing an
unbroken chain of title from the originator to the Trustee, each with evidence of recording thereof, evidencing the interest of the
originator under the Security Agreement and the Assignment of Proprietary Lease;
(viii) An executed assignment of the interest of the originator in the Security Agreement, Assignment of
Proprietary Lease and the recognition agreement referenced in clause (iv) above, showing an unbroken chain of title from the
originator to the Trustee or a copy thereof;
(ix) The original of each modification, assumption agreement or preferred loan agreement, if any, relating to
such Cooperative Loan; and
(x) A duly completed UCC-1 financing statement showing the Master Servicer as debtor, the Company as secured
party and the Trustee as assignee and a duly completed UCC-1 financing statement showing the Company as debtor and the Trustee as
secured party, each in a form sufficient for filing, evidencing the interest of such debtors in the Cooperative Loans or copies
thereof.
(III) with respect to each Sharia Mortgage Loan so assigned:
(i) The original Obligation to Pay, endorsed without recourse in blank or to the order of the Trustee and
showing an unbroken chain of endorsements from the originator thereof to the Person endorsing it to the Trustee, or with respect to
any Destroyed Obligation to Pay, an original affidavit from the related Seller or Residential Funding stating that the original
Obligation to Pay was lost, misplaced or destroyed, together with a copy of the related Obligation to Pay;
(ii) The original Sharia Mortgage Loan Security Instrument, with evidence of recording indicated thereon or a
copy of the Sharia Mortgage Loan Security Instrument with evidence of recording indicated thereon;
(iii) An original Assignment and Amendment of Security Instrument, assigned to the Trustee with evidence of
recording indicated thereon or a copy of such Assignment and Amendment of Security Instrument with evidence of recording indicated
thereon;
(iv) The original recorded assignment or assignments of the Sharia Mortgage Loan Security Instrument showing an
unbroken chain of title from the originator thereof to the Person assigning it to the Trustee with evidence of recordation noted
thereon or attached thereto, or a copy of such assignment or assignments of the Sharia Mortgage Loan Security Instrument with
evidence of recording indicated thereon;
(v) The original Sharia Mortgage Loan Co-Ownership Agreement with respect to the related Sharia Mortgage Loan
or a copy of such Sharia Mortgage Loan Co-Ownership Agreement; and
(vi) The original of each modification or assumption agreement, if any, relating to such Sharia Mortgage Loan or
a copy of each modification or assumption agreement.
(c) The Company may, in lieu of delivering the original of the documents set forth in Sections 2.01(b)(I)(ii),
(iii), (iv) and (v), Sections 2.01(b)(II)(ii), (iv), (vii), (ix) and (x) and Sections 2.01(b)(III)(ii), (iii), (iv), (v) and (vi)
(or copies thereof as permitted by Section 2.01(b)) to the Trustee or the Custodian or Custodians, deliver such documents to the
Master Servicer, and the Master Servicer shall hold such documents in trust for the use and benefit of all present and future
Certificateholders until such time as is set forth in the next sentence. Within thirty Business Days following the earlier of (i)
the receipt of the original of all of the documents or instruments set forth in Sections 2.01(b)(I)(ii), (iii), (iv) and (v),
Sections 2.01(b)(II)(ii), (iv), (vii), (ix) and (x) and Sections 2.01(b)(III) (ii), (iii), (iv), (v) and (vi) (or copies thereof as
permitted by such Section) for any Mortgage Loan and (ii) a written request by the Trustee to deliver those documents with respect to
any or all of the Mortgage Loans then being held by the Master Servicer, the Master Servicer shall deliver a complete set of such
documents to the Trustee or the Custodian or Custodians that are the duly appointed agent or agents of the Trustee.
The parties hereto agree that it is not intended that any Mortgage Loan be included in the Trust Fund that is either
(i) a “High-Cost Home Loan” as defined in the New Jersey Home Ownership Act effective November 27, 2003, (ii) a “High-Cost Home Loan”
as defined in the New Mexico Home Loan Protection Act effective January 1, 2004, (iii) a “High Cost Home Mortgage Loan” as defined in
the Massachusetts Predatory Home Loan Practices Act effective November 7, 2004 or (iv) a “High-Cost Home Loan” as defined in the
Indiana House Enrolled Act No. 1229, effective as of January 1, 2005.
(d) Notwithstanding the provisions of Section 2.01(c), in connection with any Mortgage Loan, if the Company
cannot deliver the original of the Mortgage, any assignment, modification, assumption agreement or preferred loan agreement (or copy
thereof as permitted by Section 2.01(b)) with evidence of recording thereon concurrently with the execution and delivery of this
Agreement because of (i) a delay caused by the public recording office where such Mortgage, assignment, modification, assumption
agreement or preferred loan agreement as the case may be, has been delivered for recordation, or (ii) a delay in the receipt of
certain information necessary to prepare the related assignments, the Company shall deliver or cause to be delivered to the Trustee
or the respective Custodian a copy of such Mortgage, assignment, modification, assumption agreement or preferred loan agreement.
The Company (i) shall promptly cause to be recorded in the appropriate public office for real property records the
Assignment referred to in clause (I)(iii) of Section 2.01(b), except (a) in states where, in the opinion of counsel acceptable to
the Trustee and the Master Servicer, such recording is not required to protect the Trustee’s interests in the Mortgage Loan against
the claim of any subsequent transferee or any successor to or creditor of the Company or the originator of such Mortgage Loan or (b)
if MERS is identified on the Mortgage or on a properly recorded assignment of the Mortgage as the mortgagee of record solely as
nominee for the Seller and its successors and assigns, (ii) shall promptly cause to be filed the Form UCC-3 assignment and UCC-1
financing statement referred to in clauses (II)(vii) and (x), respectively, of Section 2.01(b) and (iii) shall promptly cause to be
recorded in the appropriate public recording office for real property records the Assignment Agreement and Amendment of Security
Instrument referred to in clause (III)(iii) of Section 2.01(b). If any Assignment, Assignment Agreement and Amendment of Security
Instrument, Form UCC-3 or Form UCC-1, as applicable, is lost or returned unrecorded to the Company because of any defect therein, the
Company shall prepare a substitute Assignment, Assignment Agreement and Amendment of Security Instrument, Form UCC-3 or Form UCC-1,
as applicable, or cure such defect, as the case may be, and cause such Assignment or Assignment Agreement and Amendment of Security
Instrument to be recorded in accordance with this paragraph. The Company shall promptly deliver or cause to be delivered to the
Trustee or the respective Custodian such Mortgage or Assignment or Assignment Agreement and Amendment of Security Instrument or Form
UCC-3 or Form UCC-1, as applicable, (or copy thereof as permitted by Section 2.01(b)) with evidence of recording indicated thereon at
the time specified in Section 2.01(c). In connection with its servicing of Cooperative Loans, the Master Servicer will use its best
efforts to file timely continuation statements with regard to each financing statement and assignment relating to Cooperative Loans
as to which the related Cooperative Apartment is located outside of the State of New York.
If the Company delivers to the Trustee or Custodian any Mortgage Note, Obligation to Pay, Assignment Agreement and
Amendment of Security Instrument or Assignment of Mortgage in blank, the Company shall, or shall cause the Custodian to, complete the
endorsement of the Mortgage Note, Obligation to Pay, Assignment Agreement and Amendment of Security Instrument and Assignment of
Mortgage in the name of the Trustee in conjunction with the Interim Certification issued by the Custodian, as contemplated by Section
2.02.
Any of the items set forth in Sections 2.01(b)(I)(ii), (iii), (iv) and (v), Sections 2.01(b)(II)(vi) and (vii) and
Sections 2.01(b)(III)(ii), (iii) and (iv) that may be delivered as a copy rather than the original may be delivered to the Trustee or
the Custodian.
In connection with the assignment of any Mortgage Loan registered on the MERSreg; System, the Company further
agrees that it will cause, at the Company’s own expense, within 30 Business Days after the Closing Date, the MERSreg; System to indicate
that such Mortgage Loans have been assigned by the Company to the Trustee in accordance with this Agreement for the benefit of the
Certificateholders by including (or deleting, in the case of Mortgage Loans which are repurchased in accordance with this Agreement)
in such computer files (a) the code in the field which identifies the specific Trustee and (b) the code in the field “Pool Field”
which identifies the series of the Certificates issued in connection with such Mortgage Loans. The Company further agrees that it
will not, and will not permit the Master Servicer to, and the Master Xxxxxxxx agrees that it will not, alter the codes referenced in
this paragraph with respect to any Mortgage Loan during the term of this Agreement unless and until such Mortgage Loan is repurchased
in accordance with the terms of this Agreement.
(e) (See Section 2.01(e) of the Standard Terms).
(f) It is intended that the conveyance by the Company to the Trustee of the Mortgage Loans as provided for in
this Section 2.01 be and the Uncertificated REMIC Regular Interests, if any (as provided for in Section 2.06), be construed as a sale
by the Company to the Trustee of the Mortgage Loans and any Uncertificated REMIC Regular Interests for the benefit of the
Certificateholders. Further, it is not intended that such conveyance be deemed to be a pledge of the Mortgage Loans and any
Uncertificated REMIC Regular Interests by the Company to the Trustee to secure a debt or other obligation of the Company.
Nonetheless, (a) this Agreement is intended to be and hereby is a security agreement within the meaning of Articles 8 and 9 of the
New York Uniform Commercial Code and the Uniform Commercial Code of any other applicable jurisdiction; (b) the conveyance provided
for in Section 2.01 shall be deemed to be, and hereby is, (1) a grant by the Company to the Trustee of a security interest in all of
the Company’s right (including the power to convey title thereto), title and interest, whether now owned or hereafter acquired, in
and to any and all general intangibles, payment intangibles, accounts, chattel paper, instruments, documents, money, deposit
accounts, certificates of deposit, goods, letters of credit, advices of credit and investment property and other property of whatever
kind or description now existing or hereafter acquired consisting of, arising from or relating to any of the following: (A) the
Mortgage Loans, including (i) with respect to each Cooperative Loan, the related Mortgage Note, Security Agreement, Assignment of
Proprietary Lease, Cooperative Stock Certificate and Cooperative Lease, (ii) with respect to each Sharia Mortgage Loan, the related
Sharia Mortgage Loan Security Instrument, Sharia Mortgage Loan Co-Ownership Agreement, Obligation to Pay and Assignment Agreement and
Amendment of Security Instrument, (iii) with respect to each Mortgage Loan other than a Cooperative Loan or a Sharia Mortgage Loan,
the related Mortgage Note and Mortgage, and (iv) any insurance policies and all other documents in the related Mortgage File, (B) all
amounts payable pursuant to the Mortgage Loans in accordance with the terms thereof, (C) any Uncertificated REMIC Regular Interests
and (D) all proceeds of the conversion, voluntary or involuntary, of the foregoing into cash, instruments, securities or other
property, including without limitation all amounts from time to time held or invested in the Certificate Account or the Custodial
Account, whether in the form of cash, instruments, securities or other property and (2) an assignment by the Company to the Trustee
of any security interest in any and all of Residential Funding’s right (including the power to convey title thereto), title and
interest, whether now owned or hereafter acquired, in and to the property described in the foregoing clauses (1)(A), (B), (C) and (D)
granted by Residential Funding to the Company pursuant to the Assignment Agreement; (c) the possession by the Trustee, the Custodian
or any other agent of the Trustee of Mortgage Notes or such other items of property as constitute instruments, money, payment
intangibles, negotiable documents, goods, deposit accounts, letters of credit, advices of credit, investment property, certificated
securities or chattel paper shall be deemed to be “possession by the secured party,” or possession by a purchaser or a person
designated by such secured party, for purposes of perfecting the security interest pursuant to the Minnesota Uniform Commercial Code
and the Uniform Commercial Code of any other applicable jurisdiction as in effect (including, without limitation, Sections 8-106,
9-313, 9-314 and 9-106 thereof); and (d) notifications to persons holding such property, and acknowledgments, receipts or
confirmations from persons holding such property, shall be deemed notifications to, or acknowledgments, receipts or confirmations
from, securities intermediaries, bailees or agents of, or persons holding for (as applicable) the Trustee for the purpose of
perfecting such security interest under applicable law.
The Company and, at the Company’s direction, Residential Funding and the Trustee shall, to the extent consistent
with this Agreement, take such reasonable actions as may be necessary to ensure that, if this Agreement were determined to create a
security interest in the Mortgage Loans, any Uncertificated REMIC Regular Interests and the other property described above, such
security interest would be determined to be a perfected security interest of first priority under applicable law and will be
maintained as such throughout the term of this Agreement. Without limiting the generality of the foregoing, the Company shall
prepare and deliver to the Trustee not less than 15 days prior to any filing date and, the Trustee shall forward for filing, or shall
cause to be forwarded for filing, at the expense of the Company, all filings necessary to maintain the effectiveness of any original
filings necessary under the Uniform Commercial Code as in effect in any jurisdiction to perfect the Trustee’s security interest in or
lien on the Mortgage Loans and any Uncertificated REMIC Regular Interests, as evidenced by an Officers’ Certificate of the Company,
including without limitation (x) continuation statements, and (y) such other statements as may be occasioned by (1) any change of
name of Residential Funding, the Company or the Trustee (such preparation and filing shall be at the expense of the Trustee, if
occasioned by a change in the Trustee’s name), (2) any change of type or jurisdiction of organization of Residential Funding or the
Company, (3) any transfer of any interest of Residential Funding or the Company in any Mortgage Loan or (4) any transfer of any
interest of Residential Funding or the Company in any Uncertificated REMIC Regular Interest.
(g) (See Section 2.01(g) of the Standard Terms).
(h) (See Section 2.01(h) of the Standard Terms).
Section 2.02. Acceptance by Trustee. (See Section 2.02 of the Standard Terms.)
Section 2.03. Representations, Warranties and Covenants of the Master Servicer and the Company.
(a) For representations, warranties and covenants of the Master Servicer, see Section 2.03(a) of the Standard Terms.
(b) The Company hereby represents and warrants to the Trustee for the benefit of Certificateholders that as of the Closing Date
(or, if otherwise specified below, as of the date so specified):
(i) No Mortgage Loan is 30 or more days Delinquent in payment of principal and interest as of the Cut-off Date and no Mortgage
Loan has been so Delinquent more than once in the 12-month period prior to the Cut-off Date;
(ii) The information set forth in Exhibit 1 hereto with respect to each Mortgage Loan or the Mortgage Loans, as the case may be,
is true and correct in all material respects at the date or dates respecting which such information is furnished;
(iii) The Mortgage Loans are fully-amortizing (subject to interest only periods, if applicable), hybrid adjustable-rate mortgage
loans with Monthly Payments due, with respect to a majority of the Mortgage Loans, on the first day of each month
and terms to maturity at origination or modification of not more than 30 years;
(iv) To the best of the Company’s knowledge, except in the case of approximately 0.1% of the aggregate principal balance of the
Mortgage Loans, each Mortgage Loan is required to be covered by a standard hazard insurance policy. Of the
remaining Mortgage Loans, except in the case of approximately 0.2% of the aggregate principal balance of the
Mortgage Loans, if a Mortgage Loan is secured by a Mortgaged Property with a Loan-to-Value Ratio at origination in
excess of 80%, such Mortgage Loan is the subject of a Primary Insurance Policy that insures (a) at least 35% of the
Stated Principal Balance of the Mortgage Loan at origination if the Loan-to-Value Ratio is between 100.00% and
95.01%, (b) at least 30% of the Stated Principal Balance of the Mortgage Loan at origination if the Loan-to-Value
Ratio is between 95.00% and 90.01%, (c) at least 25% of such balance if the Loan-to-Value Ratio is between 90.00%
and 85.01% and (d) at least 12% of such balance if the Loan-to-Value Ratio is between 85.00% and 80.01%. To the
best of the Company’s knowledge, each such Primary Insurance Policy is in full force and effect and the Trustee is
entitled to the benefits thereunder;
(v) The issuers of the Primary Insurance Policies are insurance companies whose claims-paying abilities are currently acceptable
to each Rating Agency;
(vi) No more than 0.5% of the Mortgage Loans in Loan Group I by aggregate Stated Principal Balance as of the Cut-off Date are
secured by Mortgaged Properties located in any one zip code area in Virginia, and no more than 0.5% of the Mortgage
Loans by aggregate Stated Principal Balance as of the Cut-off Date are secured by Mortgaged Properties located in
any one zip code area outside Virginia. No more than 1.7% of the Mortgage Loans in Loan Group II by aggregate
Stated Principal Balance as of the Cut-off Date are secured by Mortgaged Properties located in any one zip code area
in California, and no more than 1.6% of the Mortgage Loans by aggregate Stated Principal Balance as of the Cut-off
Date are secured by Mortgaged Properties located in any one zip code area outside California.
(vii) The improvements upon the Mortgaged Properties are insured against loss by fire and other hazards as required by the Program
Guide, including flood insurance if required under the National Flood Insurance Act of 1968, as amended. The
Mortgage requires the Mortgagor to maintain such casualty insurance at the Mortgagor’s expense, and on the
Mortgagor’s failure to do so, authorizes the holder of the Mortgage to obtain and maintain such insurance at the
Mortgagor’s expense and to seek reimbursement therefor from the Mortgagor;
(viii) Immediately prior to the assignment of the Mortgage Loans to the Trustee, the Company had good title to, and was the sole
owner of, each Mortgage Loan free and clear of any pledge, lien, encumbrance or security interest (other than rights
to servicing and related compensation) and such assignment validly transfers ownership of the Mortgage Loans to the
Trustee free and clear of any pledge, lien, encumbrance or security interest;
(ix) No more than 51.2% and 56.8% of the Mortgage Loans in Loan Group I and Loan Group II, respectively, by aggregate Stated
Principal Balance as of the Cut-off Date were underwritten under a reduced loan documentation program, no more than
14.9% and 10.3% of the Mortgage Loans in Loan Group I and Loan Group II, respectively, by aggregate Stated Principal
Balance as of the Cut-off Date were underwritten under a no-stated income program, and no more than 8.3% and 5.5% of
the Mortgage Loans in Loan Group I and Loan Group II, respectively, by aggregate Stated Principal Balance as of the
Cut-off Date were underwritten under a no income/no asset program.
(x) Except with respect to no more than 18.1% and 12.7% of the Mortgage Loans in Loan Group I and Loan Group II, respectively,
by aggregate Stated Principal Balance as of the Cut-off Date, the Mortgagor represented in its loan application with
respect to the related Mortgage Loan that the Mortgaged Property would be owner-occupied;
(xi) None of the Mortgage Loans is a Buy-Down Mortgage Loan;
(xii) Each Mortgage Loan constitutes a qualified mortgage under Section 860G(a)(3)(A) of the Code and Treasury Regulation Section
1.860G-2(a)(1), (2), (4), (5), (6), (7) and (9) without reliance on the provisions of Treasury Regulation Section
1.860G-2(a)(3) or Treasury Regulation Section 1.860G-2(f)(2) or any other provision that would allow a Mortgage Loan
to be treated as a "qualified mortgage" notwithstanding its failure to meet the requirements of Section
860G(a)(3)(A) of the Code and Treasury Regulation Section 1.860G-2(a)(1), (2), (4), (5), (6), (7) and (9);
(xiii) A policy of title insurance was effective as of the closing of each Mortgage Loan and is valid and binding and remains in
full force and effect, unless the Mortgaged Properties are located in the State of Iowa and an attorney’s
certificate has been provided as described in the Program Guide;
(xiv) No Mortgage Loan is a Cooperative Loan;
(xv) With respect to each Mortgage Loan originated under a “streamlined” Mortgage Loan program (through which no new or updated
appraisals of Mortgaged Properties are obtained in connection with the refinancing thereof), the related Seller has
represented that either (a) the value of the related Mortgaged Property as of the date the Mortgage Loan was
originated was not less than the appraised value of such property at the time of origination of the refinanced
Mortgage Loan or (b) the Loan-to-Value Ratio of the Mortgage Loan as of the date of origination of the Mortgage Loan
generally meets the Company’s underwriting guidelines;
(xvi) Interest on each Mortgage Loan is calculated on the basis of a 360-day year consisting of twelve 30-day months;
(xvii) None of the Mortgage Loans contain in the related Mortgage File a Destroyed Mortgage Note;
(xviii) None of the Mortgage Loans has been made to International Borrowers;
(xix) No Mortgage Loan provides for payments that are subject to reduction by withholding taxes levied by any foreign (non-United
States) sovereign government; and
(xx) None of the Mortgage Loans are Additional Collateral Loans and none of the Mortgage Loans are Pledged Asset Loans.
It is understood and agreed that the representations and warranties set forth in this Section 2.03(b) shall survive delivery of the
respective Mortgage Files to the Trustee or any Custodian.
Upon discovery by any of the Company, the Master Servicer, the Trustee or any Custodian of a breach of any of the
representations and warranties set forth in this Section 2.03(b) that materially and adversely affects the interests of the
Certificateholders in any Mortgage Loan, the party discovering such breach shall give prompt written notice to the other parties (any
Custodian being so obligated under a Custodial Agreement); provided, however, that in the event of a breach of the representation and
warranty set forth in Section 2.03(b)(xii), the party discovering such breach shall give such notice within five days of discovery.
Within 90 days of its discovery or its receipt of notice of breach, the Company shall either (i) cure such breach in all material
respects or (ii) purchase such Mortgage Loan from the Trust Fund at the Purchase Price and in the manner set forth in Section 2.02;
provided that the Company shall have the option to substitute a Qualified Substitute Mortgage Loan or Loans for such Mortgage Loan if
such substitution occurs within two years following the Closing Date; provided that if the omission or defect would cause the
Mortgage Loan to be other than a “qualified mortgage” as defined in Section 860G(a)(3) of the Code, any such cure or repurchase must
occur within 90 days from the date such breach was discovered. Any such substitution shall be effected by the Company under the same
terms and conditions as provided in Section 2.04 for substitutions by Residential Funding. It is understood and agreed that the
obligation of the Company to cure such breach or to so purchase or substitute for any Mortgage Loan as to which such a breach has
occurred and is continuing shall constitute the sole remedy respecting such breach available to the Certificateholders or the Trustee
on behalf of the Certificateholders.
Section 2.04. Representations and Warranties of Sellers.(See Section 2.04 of the Standard Terms)
Section 2.05. Execution and Authentication of Certificates/Issuance of Certificates Evidencing Interests in REMICs.
The Trustee acknowledges the assignment to it of the Mortgage Loans and the delivery of the Mortgage Files to it, or any
Custodian on its behalf, subject to any exceptions noted, together with the assignment to it of all other assets included in the
Trust Fund and/or the applicable REMIC, receipt of which is hereby acknowledged. Concurrently with such delivery and in exchange
therefor, the Trustee, pursuant to the written request of the Company executed by an officer of the Company, has executed and caused
to be authenticated and delivered to or upon the order of the Company the Class I-R-I Certificates in authorized denominations which,
together with the REMIC I Regular Interests, evidence the beneficial interest in REMIC I, the Class I-R-II Certificates in authorized
denominations which, together with the REMIC II Regular Interests, evidence the beneficial interest in REMIC II, and the Class II-R-I
Certificates in authorized denominations which, together with the Group II Certificates (other than the Class II-P Certificates),
evidence the beneficial interest in REMIC IV.
Section 2.06. Conveyance of Uncertificated REMIC Regular Interests; Acceptance by the Trustee.
The Company, as of the Closing Date, and concurrently with the execution and delivery hereof, does hereby assign without
recourse all the right, title and interest of the Company in and to the Uncertificated REMIC Regular Interests to the Trustee for the
benefit of the Holders of each Class of Certificates (other than the Class I-R-I, Class I-R-II, Class I-P and Group II
Certificates). The Trustee acknowledges receipt of the Uncertificated REMIC Regular Interests and declares that it holds and will
hold the same in trust for the exclusive use and benefit of all present and future Holders of each Class of Certificates (other than
the Class I-R-I, Class I-R-II, Class I-P and Group II Certificates). The rights of the Holders of each Class of Certificates (other
than the Class I-R-I, Class I-R-II, Class I-P and Group II Certificates) to receive distributions from the proceeds of REMIC III in
respect of such Classes, and all ownership interests of the Holders of such Classes in such distributions, shall be as set forth in
this Agreement.
Section 2.07. Issuance of Certificates Evidencing Interests in REMIC III and REMIC IV.
The Trustee acknowledges the assignment to it of the Uncertificated REMIC Regular Interests, and, concurrently therewith and
in exchange therefor, pursuant to the written request of the Company executed by an officer of the Company, the Trustee has executed
and caused to be authenticated and delivered to or upon the order of the Company, all Classes of Group I Certificates (other than the
Class I-R-I, Class I-R-II and Class I-P Certificates) in authorized denominations, which evidence the beneficial interest in the
entire REMIC III.
Section 2.08. Purposes and Powers of the Trust. (See Section 2.08 of the Standard Terms.)
Section 2.09. Agreement Regarding Ability to Disclose.
The Company, the Master Servicer and the Trustee hereby agree, notwithstanding any other express or implied agreement to the
contrary, that any and all Persons, and any of their respective employees, representatives, and other agents may disclose,
immediately upon commencement of discussions, to any and all Persons, without limitation of any kind, the tax treatment and tax
structure of the transaction and all materials of any kind (including opinions or other tax analyses) that are provided to any of
them relating to such tax treatment and tax structure. For purposes of this paragraph, the terms “tax treatment” and “tax structure”
are defined under Treasury Regulation § 1.6011-4(c).
ARTICLE III
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 3.01 Master Servicer to Act as Servicer. (See Section 3.01 of the Standard Terms)
Section 3.02 Subservicing Agreements Between Master Servicer and Subservicers; Enforcement of Subservicers’ and Sellers’
Obligations. (See Section 3.02 of the Standard Terms)
Section 3.03 Successor Subservicers. (See Section 3.03 of the Standard Terms)
Section 3.04 Liability of the Master Servicer. (See Section 3.04 of the Standard Terms)
Section 3.05 No Contractual Relationship Between Subservicer and Trustee or Certificateholders. (See Section 3.05 of
the Standard Terms)
Section 3.06 Assumption or Termination of Subservicing Agreements by Trustee. (See Section 3.06 of the Standard Terms)
Section 3.07 Collection of Certain Mortgage Loan Payments; Deposit to Custodial Account.
(a) (See Section 3.07(a) of the Standard Terms)
(b) The Master Servicer shall establish and maintain a Custodial Account in which the Master Servicer shall deposit or
cause to be deposited on a daily basis, except as otherwise specifically provided herein, the following payments and collections
remitted by Subservicers or received by it in respect of the Mortgage Loans subsequent to the Cut-off Date (other than in respect of
principal and interest on the Mortgage Loans due on or before the Cut-off Date):
(i) All payments on account of principal, including Principal Prepayments made by Mortgagors on the Mortgage
Loans and the principal component of any Subservicer Advance or of any REO Proceeds received in connection with an REO
Property for which an REO Disposition has occurred;
(ii) All payments on account of interest at the Adjusted Mortgage Rate on the Mortgage Loans, including Buydown
Funds, if any, and the interest component of any Subservicer Advance or of any REO Proceeds received in connection with an
REO Property for which an REO Disposition has occurred;
(iii) Insurance Proceeds, Subsequent Recoveries and Liquidation Proceeds (net of any related expenses of the
Subservicer);
(iv) All proceeds of any Mortgage Loans purchased pursuant to Section 2.02, 2.03, 2.04 or 4.07 (including
amounts received from Residential Funding pursuant to the last paragraph of Section 4 of the Assignment Agreement in respect
of any liability, penalty or expense that resulted from a breach of the Compliance With Laws Representation and all amounts
required to be deposited in connection with the substitution of a Qualified Substitute Mortgage Loan pursuant to Section
2.03 or 2.04);
(v) Any amounts required to be deposited pursuant to Section 3.07(c) or 3.21;
(vi) All amounts transferred from the Certificate Account to the Custodial Account in accordance with Section
4.02(a);
(vii) Any amounts realized by the Subservicer and received by the Master Servicer in respect of any Additional
Collateral;
(viii) Any amounts received by the Master Servicer in respect of Pledged Assets; and
(ix) Any amounts received by the Master Servicer in connection with any Prepayment Charges on the Prepayment
Charge Loans.
The foregoing requirements for deposit in the Custodial Account shall be exclusive, it being understood and agreed that,
without limiting the generality of the foregoing, payments on the Mortgage Loans which are not part of the Trust Fund (consisting of
payments in respect of principal and interest on the Mortgage Loans due on or before the Cut-off Date) and payments or collections in
the nature of late payment charges or assumption fees may but need not be deposited by the Master Servicer in the Custodial Account.
In the event any amount not required to be deposited in the Custodial Account is so deposited, the Master Servicer may at any time
withdraw such amount from the Custodial Account, any provision herein to the contrary notwithstanding. Amounts received by the
Master Servicer in connection with Prepayment Charges on the Prepayment Charge Loans shall be remitted by the Master Servicer on the
Certificate Account Deposit Date to the Trustee and shall be deposited by the Trustee, upon the receipt thereof and written direction
with respect thereto, into the Class P Reserve Account. The Custodial Account may contain funds that belong to one or more trust
funds created for mortgage pass-through certificates of other series and may contain other funds respecting payments on Mortgage
Loans belonging to the Master Servicer or serviced or master serviced by it on behalf of others. Notwithstanding such commingling of
funds, the Master Servicer shall keep records that accurately reflect the funds on deposit in the Custodial Account that have been
identified by it as being attributable to the Mortgage Loans.
With respect to Insurance Proceeds, Liquidation Proceeds, REO Proceeds and the proceeds of the purchase of any Mortgage Loan
pursuant to Sections 2.02, 2.03, 2.04 and 4.07 received in any calendar month, the Master Servicer may elect to treat such amounts as
included in the Available Distribution Amount for the Distribution Date in the month of receipt, but is not obligated to do so. If
the Master Servicer so elects, such amounts will be deemed to have been received (and any related Realized Loss shall be deemed to
have occurred) on the last day of the month prior to the receipt thereof.
(c) (See Section 3.07(c) of the Standard Terms)
(d) (See Section 3.07(d) of the Standard Terms)
(e) Notwithstanding Section 3.07(a), The Master Servicer shall not waive (or permit a Subservicer to waive) any
Prepayment Charge unless: (i) the enforceability thereof shall have been limited by bankruptcy, insolvency, moratorium, receivership
and other similar laws relating to creditors’ rights generally, (ii) the enforcement thereof is illegal, or any local, state or
federal agency has threatened legal action if the prepayment penalty is enforced, (iii) the collectability thereof shall have been
limited due to acceleration in connection with a foreclosure or other involuntary payment or (iv) such waiver is standard and
customary in servicing similar Mortgage Loans and relates to a default or a reasonably foreseeable default and would, in the
reasonable judgment of the Master Servicer, maximize recovery of total proceeds taking into account the value of such Prepayment
Charge and the related Mortgage Loan. In no event will the Master Servicer waive a Prepayment Charge in connection with a
refinancing of a Mortgage Loan that is not related to a default or a reasonably foreseeable default. If a Prepayment Charge is
waived, but does not meet the standards described above, then the Master Servicer is required to remit the amount of such waived
Prepayment Charge to the Trustee at the time that the amount prepaid on the related Mortgage Loan is required to be deposited into
the Custodial Account, and upon receipt thereof and written direction with respect thereto, the Trustee shall deposit such amount
into the Class P Reserve Account. Notwithstanding any other provisions of this Agreement, any payments made by the Master Servicer
in respect of any waived Prepayment Charges pursuant to this Section shall be deemed to be paid outside of the Trust Fund and not
part of any REMIC.
Section 3.08. Subservicing Accounts; Servicing Accounts (See Section 3.08 of the Standard Terms)
Section 3.09. Access to Certain Documentation and Information Regarding the Mortgage Loans (See Section 3.09 of the
Standard Terms)
Section 3.10. Permitted Withdrawals from the Custodial Account (See Section 3.10 of the Standard Terms)
Section 3.11. Maintenance of the Primary Insurance Policies; Collections Thereunder (See Section 3.011 of the Standard
Terms)
Section 3.12. Maintenance of Fire Insurance and Omissions and Fidelity Coverage (See Section 3.12 of the Standard Terms)
Section 3.13. Enforcement of Due-on-Sale Clauses; Assumption and Modification Agreements; Certain Assignments(See
Section 3.13 of the Standard Terms)
Section 3.14. Realization Upon Defaulted Mortgage Loans (See Section 3.14 of the Standard Terms)
Section 3.15. Trustee to Cooperate; Release of Mortgage Files (See Section 3.15 of the Standard Terms)
Section 3.16. Servicing and Other Compensation; Compensating Interest
(a) The Master Servicer, as compensation for its activities hereunder, shall be entitled to receive on each
Distribution Date the amounts provided for by clauses (iii), (iv), (v) and (vi) of Section 3.10(a), subject to clause (e)
below. The amount of servicing compensation provided for in such clauses shall be (1) accounted for on a Mortgage
Loan-by-Mortgage Loan basis and (2) calculated seperately for each Loan Group. In the event that Liquidation Proceeds,
Insurance Proceeds and REO Proceeds (net of amounts reimbursable therefrom pursuant to Section 3.10(a)(ii)) in respect of a
Cash Liquidation or REO Disposition exceed the unpaid principal balance of such Mortgage Loan plus unpaid interest accrued
thereon (including REO Imputed Interest) at a per annum rate equal to the related Net Mortgage Rate (or the Modified Net
Mortgage Rate in the case of a Modified Mortgage Loan), the Master Servicer shall be entitled to retain therefrom and to pay
to itself and/or the related Subservicer, any Foreclosure Profits and any Servicing Fee or Subservicing Fee considered to be
accrued but unpaid.
(b) Additional servicing compensation in the form of assumption fees, late payment charges, investment income
on amounts in the Custodial Account or the Certificate Account or otherwise (but not including Prepayment Charges) shall be
retained by the Master Servicer or the Subservicer to the extent provided herein, subject to clause (e) below. Prepayment
Charges relating to the Group I Loans shall be deposited into the Class P Reserve Account and shall be paid on each
Distribution Date to the holders of the Class I-P Certificates. Prepayment Charges relating to the Group II Loans shall be
deposited into the Class P Reserve Account and shall be paid on each Distribution Date to the holders of the Class II-P
Certificates.
(c) (See Section 3.16(c) of the Standard Terms)
(d) (See Section 3.16(d) of the Standard Terms)
(e) (See Section 3.16(e) of the Standard Terms)
Section 3.17. Reports to the Trustee and the Company (See Section 3.17 of the Standard Terms)
Section 3.18. Annual Statement as to Compliance (See Section 3.18 of the Standard Terms)
Section 3.19. Annual Independent Public Accountants’ Servicing Report (See Section 3.19 of the Standard Terms)
Section 3.20. Rights of the Company in Respect of the Master Servicer (See Section 3.20 of the Standard Terms)
Section 3.21. Administration of Buydown Funds (See Section 3.21 of the Standard Terms)
Section 3.22 Advance Facility (See Section 3.22 of the Standard Terms)
ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS
Section 4.01. Certificate Account.
(a) The Master Servicer on behalf of the Trustee shall establish and maintain a Certificate Account in which the Master Servicer
shall cause to be deposited on behalf of the Trustee on or before 2:00 P.M. New York time on each Certificate Account Deposit Date by
wire transfer of immediately available funds an amount equal to the sum of (i) any Advance for the immediately succeeding
Distribution Date, (ii) any amount required to be deposited in the Certificate Account pursuant to Section 3.12(a), (iii) any amount
required to be deposited in the Certificate Account pursuant to Section 3.16(e) or Section 4.07, (iv) any amount required to be paid
pursuant to Section 9.01, (v) all other amounts constituting the Available Distribution Amount for the immediately succeeding
Distribution Date, and (vi) amounts deducted from the the Available Distribution Amount for Loan Group I pursuant to clause (b)(z) of
the definition of Available Distribution Amount for such Distribution Date.
On or prior to the Business Day immediately following each Determination Date, the Master Servicer shall determine
any amounts owed by the Swap Counterparty under the Swap Agreement and inform the Trustee in writing of the amount so calculated.
(b) (See Section 4.01(b) of the Standard Terms)
Section 4.02. Distributions.
(a) On each Distribution Date, the Trustee (or the Paying Agent on behalf of the Trustee) shall allocate and distribute the
Available Distribution Amount to the extent on deposit in the Certificate Account for such date to the interests issued in respect of
REMIC I, REMIC II, REMIC III and REMIC IV as specified in this Section.
(b) (1) On each Distribution Date, the REMIC I Distribution Amount shall be distributed by REMIC I to REMIC II on
account of the REMIC I Regular Interests in the amounts and with the priorities set forth in the definition thereof.
(2) On each Distribution Date, the REMIC II Distribution Amount shall be distributed by REMIC II to
REMIC III on account of the REMIC II Regular Interests in the amounts and with the priorities set forth in the definition
thereof.
(3) On each Distribution Date, the REMIC III Distribution Amount shall be deemed to have been
distributed by REMIC III to the Group I Certificateholders on account of the REMIC III Regular Interests represented thereby in
the amounts and with the priorities set forth in the definition thereof.
(4) On each Distribution Date, the amount, if any, deemed received by the Class I-SB Certificate in
respect of the REMIC III Regular Interest IO and under the SB-AM Swap Agreement shall be deemed to have been paid on behalf of
the Class I-SB Certificate by the Trustee pursuant to Section 4.09 in respect of the Net Swap Payment owed to the Swap
Counterparty. On each Distribution Date, the amount, if any, received by the Trustee from the Swap Counterparty in respect of
the Swap Agreement shall be deemed to have been received by the Trustee on behalf of the Class I-SB Certificates. On each
Distribution Date, amounts paid to the Class I-A and Class I-M Certificates pursuant to Section 4.02(c)(v) in respect of Basis
Risk Shortfall shall be deemed to have been paid by the Class I-SB Certificateholder pursuant to the SB-AM Swap Agreement.
(5) On each Distribution Date, the Available Distribution Amount for Loan Group II shall be deemed to
have been distributed by REMIC IV to the Group II Certificateholders on account of the REMIC IV Regular Interests represented
thereby in the amounts and with the priorities set forth in Section 4.02(c).
(6) Notwithstanding the distributions described in this Section 4.02(b), distribution of funds from
the Certificate Account shall be made only in accordance with Section 4.02(c).
(c) On each Distribution Date (x) the Master Servicer on behalf of the Trustee or (y) the Paying Agent appointed by the Trustee,
shall distribute to each Certificateholder of record on the next preceding Record Date (other than as provided in Section 9.01 of the
Standard Terms respecting the final distribution) either in immediately available funds (by wire transfer or otherwise) to the
account of such Certificateholder at a bank or other entity having appropriate facilities therefor, if such Certificateholder has so
notified the Master Servicer or the Paying Agent, as the case may be, or, if such Certificateholder has not so notified the Master
Servicer or the Paying Agent by the Record Date, by check mailed to such Certificateholder at the address of such Holder appearing in
the Certificate Register such Certificateholder’s share (which share with respect to each Class of Certificates, shall be based on
the aggregate of the Percentage Interests represented by Certificates of the applicable Class held by such Holder of the following
amounts), in the following orders of priority, in each case to the extent of the Available Distribution Amount on deposit in the
Certificate Account:
(I) With respect to the Group I Certificates
(i) (A) to the Class I-A Certificates and the Class I-M Certificates, sequentially, the Group
I Interest Distribution Amount, as follows:
(1) first, to the Class I-A Certificates, Accrued Certificate Interest due thereon for such Distribution Date plus any Accrued
Certificate Interest due thereon remaining unpaid from any prior Distribution Date, together with interest
thereon at the related Pass-Through Rate in effect for such Distribution Date, on a pro rata basis in
accordance with the Accrued Certificate Interest and any interest thereon due to each such Class;
(2) second, to the Class I-M-1 Certificates, Accrued Certificate Interest due thereon for such Distribution Date plus any
Accrued Certificate Interest due thereon remaining unpaid from any prior Distribution Date, together with
interest thereon at the related Pass-Through Rate in effect for such Distribution Date;
(3) third, to the Class I-M-2 Certificates Accrued Certificate Interest due thereon for such Distribution Date plus any Accrued
Certificate Interest due thereon remaining unpaid from any prior Distribution Date, together with interest
thereon at the related Pass-Through Rate in effect for such Distribution Date;
(4) fourth, to the Class I-M-3 Certificates Accrued Certificate Interest due thereon for such Distribution Date plus any related
Accrued Certificate Interest due thereon remaining unpaid from any prior Distribution Date, together with
interest thereon at the related Pass-Through Rate in effect for such Distribution Date;
(5) fifth, to the Class I-M-4 Certificates, Accrued Certificate Interest due thereon for such Distribution Date plus any Accrued
Certificate Interest due thereon remaining unpaid from any prior Distribution Date, together with interest
thereon at the related Pass-Through Rate in effect for such Distribution Date;
(6) sixth, to the Class I-M-5 Certificates Accrued Certificate Interest due thereon for such Distribution Date plus any Accrued
Certificate Interest due thereon remaining unpaid from any prior Distribution Date, together with interest
thereon at the related Pass-Through Rate in effect for such Distribution Date;
(7) seventh, to the Class I-M-6 Certificates Accrued Certificate Interest due thereon for such Distribution Date plus any
related Accrued Certificate Interest due thereon remaining unpaid from any prior Distribution Date,
together with interest thereon at the related Pass-Through Rate in effect for such Distribution Date;
(8) eighth, to the Class I-M-7 Certificates, Accrued Certificate Interest due thereon for such Distribution Date plus any
Accrued Certificate Interest due thereon remaining unpaid from any prior Distribution Date, together with
interest thereon at the related Pass-Through Rate in effect for such Distribution Date;
(9) ninth, to the Class I-M-8 Certificates Accrued Certificate Interest due thereon for such Distribution Date plus any Accrued
Certificate Interest due thereon remaining unpaid from any prior Distribution Date, together with interest
thereon at the related Pass-Through Rate in effect for such Distribution Date; and
(10) tenth, to the Class I-M-9 Certificates Accrued Certificate Interest due thereon for such Distribution Date plus any Accrued
Certificate Interest due thereon remaining unpaid from any prior Distribution Date, together with interest
thereon at the related Pass-Through Rate in effect for such Distribution Date;
(B) to the Class I-A Certificateholders and the Class I-M Certificateholders from
the amount, if any, of the related Available Distribution Amount remaining after the foregoing
distributions, the Group I Principal Distribution Amount, which amount shall be allocated in the manner and
priority set forth in Section 4.02(c)(I)(ii), until the aggregate Certificate Principal Balance of each
Class of Class I-A Certificates and Class I-M Certificates has been reduced to zero;
(C) to the Class I-A Certificateholders and Class I-M Certificateholders from the
amount, if any, of Excess Cash Flow remaining after the foregoing distributions, the amount of any related
Prepayment Interest Shortfalls with respect to the Group I Loans for that Distribution Date, to the extent
not covered by Compensating Interest on such Distribution Date, which amount shall be allocated to the
Class I-A Certificateholders and Class I-M Certificateholders on a pro rata basis, based on the amount of
Prepayment Interest Shortfalls allocated thereto for such Distribution Date;
(D) to the Class I-A Certificateholders and Class I-M Certificateholders from the
amount, if any, of Excess Cash Flow remaining after the foregoing distributions, the amount of any
Prepayment Interest Shortfalls allocated thereto remaining unpaid from prior Distribution Dates together
with interest thereon at the related Pass-Through Rate in effect for such Distribution Date, which amount
shall be allocated to the Class I-A Certificateholders and Class I-M Certificateholders on a pro rata
basis, based on the amount of Prepayment Interest Shortfalls remaining unpaid;
(E) to the Class I-A Certificates and Class I-M Certificates from the amount, if
any, of Excess Cash Flow remaining after the foregoing distributions the amount of any Basis Risk Shortfall
on such Certificates, which amount shall be allocated first, to the Class I-A Certificates on a pro rata
basis, based on their respective Basis Risk Shortfall for such Distribution Date, and then, sequentially,
to the Class I-M-1, Class I-M-2, Class I-M-3, Class I-M-4, Class I-M-5, Class I-M-6, Class I-M-7, Class
I-M-8 and Class I-M-9 Certificateholders, in that order;
(F) to pay the holders of the Class I-A Certificates and Class I-M Certificates, on
a pro rata basis, based on Relief Act Shortfalls related to the Group I Loans allocated thereto for such
Distribution Date, the amount of any Relief Act Shortfalls allocated thereto with respect to the Group I
Loans for such Distribution Date,
(G) sequentially, to the Class I-M-1, Class I-M-2, Class I-M-3, Class I-M-4, Class
I-M-5, Class I-M-6, Class I-M-7, Class I-M-8 and Class I-M-9 Certificateholders, in that order, the
principal portion of any Realized Losses related to the Group I Loans previously allocated to such Class of
Class I-M Certificates remaining unreimbursed;
(H) to the Swap Account for payment to the Swap Counterparty, any Swap Termination
Payments due to a Swap Counterparty Trigger Event;
(I) to the Class I-SB Certificates, (A) from the amount, if any, of the Available
Distribution Amount remaining after the foregoing distributions, the sum of (I) Accrued Certificate
Interest thereon, (II) the amount of any Overcollateralization Reduction Amount for such Distribution Date
and (III) for any Distribution Date after the Certificate Principal Balance of each Class I-A Certificate
and Class I-M Certificate has been reduced to zero, the Overcollateralization Amount, and (B) from the Net
Swap Payments owed by the Swap Counterparty, if any, the amount of such Net Swap Payments remaining after
the foregoing distributions; and
(J) to the Class I-R-III Certificateholders, the balance, if any, of the Available
Distribution Amount.
All payments of amounts in respect of Basis Risk Shortfall made pursuant to Section 4.02(c)(I)(i)(E) shall,
for federal income tax purposes, be deemed to have been distributed from REMIC III to the holder of the
Class I-SB Certificates and then paid outside of any REMIC to the recipients thereof pursuant to an
interest rate cap contract. By accepting their Certificates the holders of the Certificates agree to treat
such payments in the manner described in the preceding sentence for purposes of filing their income tax
returns.
(ii)The Group I Principal Distribution Amount payable to the Class I-A Certificateholders and
the Class I-M Certificateholders shall be distributed as follows:
(A) first, the Class I-A Principal Distribution Amount shall be distributed to the Class I-A Certificateholders as follows (i)
47.1434557899% of such amount shall be distributed to the Class I-A-1 Certificates until the Certificate
Principal Balance thereof has been reduced to zero, and (ii) 52.8565442101% of such amount shall be
distributed to the Class I-A-2 Certificates and Class I-A-3 Certificates, on a pro rata basis in accordance
with their respective Certificate Principal Balances, until the Certificate Principal Balances thereof have
been reduced to zero; provided, however, that if a Sequential Trigger Event is in effect, such amount shall
be distributed first, to the Class I-A-2 Certificates until the Certificate Principal Balance thereof has
been reduced to zero, and second, to the Class I-A-3 Certificates until the Certificate Principal Balance
thereof has been reduced to zero;
(B) second, the Class I-M-1 Principal Distribution Amount shall be distributed to the Class I-M-1 Certificates until the
Certificate Principal Balance thereof has been reduced to zero;
(C) third, the Class I-M-2 Principal Distribution Amount shall be distributed to the Class I-M-2 Certificates until the
Certificate Principal Balance thereof has been reduced to zero;
(D) fourth, the Class I-M-3 Principal Distribution Amount shall be distributed to the Class I-M-3 Certificates until the
Certificate Principal Balance thereof has been reduced to zero;
(E) fifth, the Class I-M-4 Principal Distribution Amount shall be distributed to the Class I-M-4 Certificates until the
Certificate Principal Balance thereof has been reduced to zero;
(F) sixth, the Class I-M-5 Principal Distribution Amount shall be distributed to the Class I-M-5 Certificates until the
Certificate Principal Balance thereof has been reduced to zero;
(G) seventh, the Class I-M-6 Principal Distribution Amount shall be distributed to the Class I-M-6 Certificates until the
Certificate Principal Balance thereof has been reduced to zero;
(H) eighth, the Class I-M-7 Principal Distribution Amount shall be distributed to the Class I-M-7 Certificates until the
Certificate Principal Balance thereof has been reduced to zero;
(I) ninth, the Class I-M-8 Principal Distribution Amount shall be distributed to the Class I-M-8 Certificates until the
Certificate Principal Balance thereof has been reduced to zero; and
(J) tenth, the Class I-M-9 Principal Distribution Amount shall be distributed to the Class I-M-9 Certificates until the
Certificate Principal Balance thereof has been reduced to zero.
(iii) Notwithstanding the foregoing clauses (c)(I)(i) and (c)(I)(ii), upon the reduction of the Certificate Principal Balance of a
Class of Class I-A Certificates or Class I-M Certificates to zero, such Class of Certificates will not be entitled
to further distributions pursuant to Section 4.02, including, without limitation, the payment of current and
unreimbursed Prepayment Interest Shortfalls pursuant to clauses (c)(I)(i)(C) and (c)(I)(i)(D) and Basis Risk
Shortfall pursuant to clause (c)(I)(i)(E).
(iv) Each distribution with respect to a Book-Entry Certificate shall be paid to the Depository, as Holder thereof, and the
Depository shall be solely responsible for crediting the amount of such distribution to the accounts of its
Depository Participants in accordance with its normal procedures. Each Depository Participant shall be responsible
for disbursing such distribution to the Certificate Owners that it represents and to each indirect participating
brokerage firm (a “brokerage firm”) for which it acts as agent. Each brokerage firm shall be responsible for
disbursing funds to the Certificate Owners that it represents. None of the Trustee, the Certificate Registrar, the
Company or the Master Servicer shall have any responsibility therefor.
(v) Except as otherwise provided in Section 9.01 of the Standard Terms, if the Master Servicer anticipates that a final
distribution with respect to any Class of Certificates will be made on a future Distribution Date, the Master
Servicer shall, no later than 40 days prior to such final Distribution Date, notify the Trustee and the Trustee
shall, not earlier than the 15th day and not later than the 25th day of the month next preceding the month of such
final distribution, distribute, or cause to be distributed, to each Holder of such Class of Certificates a notice to
the effect that: (i) the Trustee anticipates that the final distribution with respect to such Class of Certificates
will be made on such Distribution Date but only upon presentation and surrender of such Certificates at the office
of the Trustee or as otherwise specified therein, and (ii) no interest shall accrue on such Certificates from and
after the end of the related Interest Accrual Period. In the event that Certificateholders required to surrender
their Certificates pursuant to Section 9.01(c) of the Standard Terms do not surrender their Certificates for final
cancellation, the Trustee shall cause funds distributable with respect to such Certificates to be withdrawn from the
Certificate Account and credited to a separate escrow account for the benefit of such Certificateholders as provided
in Section 9.01(d) of the Standard Terms.
(II) With respect to the Group II Certifcates
(A)(i) from the Available Distribution Amount related to the Group II Loans, to the
Group II Certificates, on a pro rata basis based on Accrued Certificate Interest payable on such Certificates
with respect to such Distribution Date, Accrued Certificate Interest on such Classes of Group II Certificates
for such Distribution Date, plus any Accrued Certificate Interest thereon remaining unpaid from any previous
Distribution Date except as provided in the last paragraph of this Section 4.02(c)(II)(A) (the “Group II Senior
Interest Distribution Amount”);
(ii)to the Group II Senior Certificates, in the priorities and amounts set forth in Section
4.02(c)(II)(B)(1) and 4.02(c)(II)(B)(2), the sum of the following (applied to reduce the Certificate Principal
Balances of such Senior Certificates, as applicable):
(a) the Group II Senior Percentage for such Distribution Date times the sum of the following:
(1) the principal portion of each Monthly Payment due during the related Due Period on
each Outstanding Mortgage Loan in Loan Group II, whether or not received on or prior to the
related Determination Date, minus the principal portion of any related Debt Service Reduction
which together with other Bankruptcy Losses exceeds the related Bankruptcy Amount;
(2) the Stated Principal Balance of any Mortgage Loan in Loan Group II repurchased
during the preceding calendar month (or deemed to have been so repurchased in accordance with
Section 3.07(b)) pursuant to Section 2.02, 2.03, 2.04 or 4.07 and the amount of any shortfall
deposited in the Custodial Account in connection with the substitution of a Deleted Mortgage Loan
from Loan Group II pursuant to Section 2.03 or 2.04 during the preceding calendar month; and
(3) the principal portion of all other unscheduled collections with respect to Loan
Group II (other than Principal Prepayments in Full and Curtailments and amounts received in
connection with a Cash Liquidation or REO Disposition of a Mortgage Loan in Loan Group II
described in Section 4.02(c)(II)(A)(ii)(b) of this Series Supplement, including without limitation
any related Insurance Proceeds, Liquidation Proceeds and REO Proceeds), including Subsequent
Recoveries, received during the preceding calendar month (or deemed to have been so received in
accordance with Section 3.07(b)) to the extent applied by the Master Servicer as recoveries of
principal of the related Mortgage Loan pursuant to Section 3.14 of the Standard Terms;
(b) with respect to each Mortgage Loan in Loan Group II for which a Cash Liquidation or a
REO Disposition occurred during the preceding calendar month (or was deemed to have occurred during such
period in accordance with Section 3.07(b)) and did not result in any Excess Special Hazard Losses, Excess
Fraud Losses, Excess Bankruptcy Losses or Extraordinary Losses, an amount equal to the lesser of (i) the
Group II Senior Percentage for such Distribution Date times the Stated Principal Balance of such Mortgage
Loan and (ii) the Group II Senior Accelerated Distribution Percentage for such Distribution Date times
the related unscheduled collections (including without limitation Insurance Proceeds, Liquidation
Proceeds and REO Proceeds) to the extent applied by the Master Servicer as recoveries of principal of the
related Mortgage Loan pursuant to Section 3.14 of the Standard Terms;
(c) the Group II Senior Accelerated Distribution Percentage for such Distribution Date
times the aggregate of all Principal Prepayments in Full received in the related Prepayment Period and
Curtailments with respect to Loan Group II received in the preceding calendar month;
(d) any amounts described in subsection (ii), clauses (1), (2) and (3) of this Section
4.02(c)(II)(A), as determined for any previous Distribution Date, which remain unpaid after application
of amounts previously distributed pursuant to this clause (d) to the extent that such amounts are not
attributable to Realized Losses which have been allocated to the Group II Subordinate Certificates;
(e) the related Capitalization Reimbursement Amount for such Distribution Date multiplied
by a fraction, the numerator of which is the related Senior Principal Distribution Amount, without giving
effect to this clause (F), and the denominator of which is the sum of the principal distribution amounts
for all Classes of Certificates derived from the related Available Distribution Amount without giving
effect to any reductions for the Capitalization Reimbursement Amount;
(iii) if the Certificate Principal Balances of the Group II Subordinate Certificates have
not been reduced to zero, to the Master Servicer or a Sub-Servicer, by remitting for deposit to the Custodial
Account, to the extent of and in reimbursement for any Advances or Sub-Servicer Advances previously made with
respect to any Mortgage Loan or REO Property in Loan Group II which remain unreimbursed in whole or in part
following the Cash Liquidation or REO Disposition of such Mortgage Loan or REO Property, minus any such
Advances that were made with respect to delinquencies that ultimately constituted Excess Special Hazard Losses,
Excess Fraud Losses, Excess Bankruptcy Losses or Extraordinary Losses;
(iv) to the Holders of the Class II-M-1 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date, plus any Accrued Certificate Interest thereon remaining unpaid from any
previous Distribution Date, except as provided below;
(v) to the Holders of the Class II-M-1 Certificates, an amount equal to the Group II
Subordinate Principal Distribution Amount for such Class of Certificates for such Distribution Date, applied in
reduction of the Certificate Principal Balance of the Class II-M-1 Certificates;
(vi) to the Holders of the Class II-M-2 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date, plus any Accrued Certificate Interest thereon remaining unpaid from any
previous Distribution Date, except as provided below;
(vii) to the Holders of the Class II-M-2 Certificates, an amount equal to the Group II
Subordinate Principal Distribution Amount for such Class of Certificates for such Distribution Date, applied in
reduction of the Certificate Principal Balance of the Class II-M-2 Certificates;
(viii) to the Holders of the Class II-M-3 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date, plus any Accrued Certificate Interest thereon remaining unpaid from any
previous Distribution Date, except as provided below;
(ix) to the Holders of the Class II-M-3 Certificates, an amount equal to the Group II
Subordinate Principal Distribution Amount for such Class of Certificates for such Distribution Date, applied in
reduction of the Certificate Principal Balance of the Class M-3 Certificates;
(x) to the Holders of the Class II-B-1 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date, plus any Accrued Certificate Interest thereon remaining unpaid from any
previous Distribution Date, except as provided below;
(xi) to the Holders of the Class II-B-1 Certificates, an amount equal to the Group II
Subordinate Principal Distribution Amount for such Class of Certificates for such Distribution Date, applied in
reduction of the Certificate Principal Balance of the Class II-B-1 Certificates;
(xii) to the Holders of the Class II-B-2 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date, plus any Accrued Certificate Interest thereon remaining unpaid from any
previous Distribution Date, except as provided below;
(xiii) to the Holders of the Class II-B-2 Certificates, an amount equal to the Subordinate
Principal Distribution Amount for such Class of Certificates for such Distribution Date, applied in reduction
of the Certificate Principal Balance of the Class II-B-2 Certificates;
(xiv) to the Holders of the Class II-B-3 Certificates, an amount equal to the Accrued
Certificate Interest thereon for such Distribution Date, plus any Accrued Certificate Interest thereon
remaining unpaid from any previous Distribution Date, except as provided below;
(xv) to the Holders of the Class II-B-3 Certificates, an amount equal to the Subordinate
Principal Distribution Amount for such Class of Certificates for such Distribution Date, applied in reduction
of the Certificate Principal Balance of the Class II-B-3 Certificates;
(xvi) to the Group II Senior Certificates, in the priority set forth in Section
4.02(c)(II)(B) of this Series Supplement, the portion, if any, of the Available Distribution Amount for Loan
Group II remaining after the foregoing distributions, applied to reduce the Certificate Principal Balances of
such Group II Senior Certificates, but in no event more than the aggregate of the outstanding Certificate
Principal Balances of each such Class of Group II Senior Certificates, and thereafter, to each Class of Group
II Subordinate Certificates then outstanding beginning with such Class with the Highest Priority, any portion
of the Available Distribution Amount for Loan Group II remaining after the Group II Senior Certificates have
been retired, applied to reduce the Certificate Principal Balance of each such Class of Group II Subordinate
Certificates, but in no event more than the outstanding Certificate Principal Balance of each such Class of
Group II Subordinate Certificates; and
(xvii) to the Class II-R-I Certificates, the balance, if any, of the Available Distribution
Amount for Loan Group II.
Notwithstanding the foregoing, on any Distribution Date, with respect to the Class of Group II
Subordinate Certificates outstanding on such Distribution Date with the Lowest Priority, or in the event the
Group II Subordinate Certificates are no longer outstanding, the Group II Senior Certificates, Accrued
Certificate Interest thereon remaining unpaid from any previous Distribution Date will be distributable only to
the extent that (1) a shortfall in the amounts available to pay Accrued Certificate Interest on any Class of
Group II Certificates results from an interest rate reduction in connection with a Servicing Modification, or
(2) such unpaid Accrued Certificate Interest was attributable to interest shortfalls relating to the failure of
the Master Servicer to make any required Advance, or the determination by the Master Servicer that any proposed
Advance would be a Nonrecoverable Advance with respect to the related Mortgage Loan where such Mortgage Loan
has not yet been the subject of a Cash Liquidation or REO Disposition or the related Liquidation Proceeds,
Insurance Proceeds and REO Proceeds have not yet been distributed to the Certificateholders.
(B) (1) The Group II Senior Principal Distribution Amount shall be distributed as
follows: (A) first, to the Class II-R-I Certificates until the Certificate Principal Balance thereof has been
reduced to zero and (B) second, any remaining amount to the Class I-A-1 Certificates and Class I-A-2
Certificates, concurrently on a pro rata basis in accordance with their respective Certificate Principal
Balances, until the Certificate Principal Balances thereof have been reduced to zero;
(2) After the reduction of the Certificate Principal Balances of the Senior Certificates
in a Certificate Group to zero but prior to the Credit Support Depletion Date, the related Senior Certificates
will be entitled to no further distributions of principal thereon and the related Available Distribution Amount
will be distributed solely to the holders of the Subordinate Certificates, in each case as described herein.
(3) In addition to the foregoing distributions, with respect to any Subsequent
Recoveries, the Master Servicer shall deposit such funds into the Custodial Account pursuant to Section
3.07(b)(iii). If, after taking into account such Subsequent Recoveries, the amount of a Realized Loss is
reduced, the amount of such Subsequent Recoveries will be applied to increase the Certificate Principal
Balance, first, of the Class I-A Certificates, and then, of the Class of Group II Certificates with the Highest
Priority to which Realized Losses, other than Excess Bankruptcy Losses, Excess Fraud Losses, Excess Special
Hazard Losses and Extraordinary Losses, have been allocated, but not by more than the amount of Realized Losses
previously allocated to that Class of Group II Certificates pursuant to Section 4.05. The amount of any
remaining Subsequent Recoveries will be applied to increase the Certificate Principal Balance of the Class of
Group II Certificates with the next Lower Priority, up to the amount of such Realized Losses previously
allocated to that Class of Group II Certificates pursuant to Section 4.05. Any remaining Subsequent Recoveries
will in turn be applied to increase the Certificate Principal Balance of the Class of Group II Certificates
with the next Lower Priority up to the amount of such Realized Losses previously allocated to that Class of
Group II Certificates pursuant to Section 4.05, and so on. Holders of such Certificates will not be entitled to
any payment in respect of Accrued Certificate Interest on the amount of such increases for any Interest Accrual
Period preceding the Distribution Date on which such increase occurs. Any such increases shall be applied to
the Certificate Principal Balance of each Certificate of such Class in accordance with its respective
Percentage Interest.
(d) Each distribution with respect to a Book-Entry Certificate shall be paid to the Depository, as Holder
thereof, and the Depository shall be solely responsible for crediting the amount of such distribution to the accounts of its
Depository Participants in accordance with its normal procedures. Each Depository Participant shall be responsible for disbursing
such distribution to the Certificate Owners that it represents and to each indirect participating brokerage firm (a “brokerage firm”)
for which it acts as agent. Each brokerage firm shall be responsible for disbursing funds to the Certificate Owners that it
represents. None of the Trustee, the Certificate Registrar, the Company or the Master Servicer shall have any responsibility
therefor.
(e) Except as otherwise provided in Section 9.01 of the Standard Terms, if the Master Servicer anticipates that
a final distribution with respect to any Class of Certificates will be made on a future Distribution Date, the Master Servicer shall,
no later than 40 days prior to such final distribution, notify the Trustee and the Trustee shall, not earlier than the 15th day and
not later than 25th day of the month next preceding the month of such final distribution, distribute, or cause to be distributed, to
each Holder of such Class of Certificates a notice to the effect that: (i) the Trustee anticipates that the final distribution with
respect to such Class of Certificates will be made on such Distribution Date but only upon presentation and surrender of such
Certificates at the office of the Trustee or as otherwise specified therein, and (ii) no interest shall accrue on such Certificates
from and after the end of the related Interest Accrual Period. In the event that Certificateholders required to surrender their
Certificates pursuant to Section 9.01(c) of the Standard Terms do not surrender their Certificates for final cancellation, the
Trustee shall cause funds distributable with respect to such Certificates to be withdrawn from the Certificate Account and credited
to a separate escrow account for the benefit of such Certificateholders as provided in Section 9.01(d) of the Standard Terms.
(f) On the Distribution Date immediately following the last month during which a Prepayment Charge may be
assessed on a Mortgage Loan, or upon the termination of the Trust Fund pursuant to Section 9.01, an amount equal to the Class I-P
Reserve Account Amount shall be withdrawn from the Certificate Account and distributed by the Trustee to Holders of the Class I-P
Certificates until the Certificate Principal Balance thereof has been reduced to zero and an amount equal to the Class II-P Reserve
Account Amount shall be withdrawn from the Certificate Account and distributed by the Trustee to Holders of the Class II-P
Certificates until the Certificate Principal Balance thereof has been reduced to zero. In addition, on each Distribution Date, all
amounts transferred from the Class P Reserve Account representing Prepayment Charges in respect of the Prepayment Charge Loans in
Loan Group I or Loan Group II, as applicable, received during the related Prepayment Period will be withdrawn from the Certificate
Account and distributed by the Trustee to Holders of the related Class P Certificates and shall not be available for distribution to
the Holders of any other Class of Certificates.
Section 4.03. Statements to Certificateholders; Statements to the Rating Agencies; Exchange Act Reporting. (See Section 4.03 of
the Standard Terms)
Section 4.04. Distribution of Reports to the Trustee and the Company; Advances by the Master Servicer.
(a) (See Section 4.04(a) of the Standard Terms).
(b) On or before 2:00 P.M. New York time on each Certificate Account Deposit Date, the Master Servicer shall
either (i) deposit in the Certificate Account from its own funds, or funds received therefor from the Subservicers, an amount equal
to the Advances to be made by the Master Servicer in respect of the related Distribution Date, which shall be in an aggregate amount
equal to the aggregate amount of Monthly Payments (with each interest portion thereof adjusted to the Net Mortgage Rate), less the
amount of any related Servicing Modifications, Debt Service Reductions or reductions in the amount of interest collectable from the
Mortgagor pursuant to the Servicemembers Civil Relief Act, as amended, or similar legislation or regulations then in effect, on the
Outstanding Mortgage Loans as of the related Due Date, which Monthly Payments were not received as of the close of business as of the
related Determination Date; provided that no Advance shall be made if it would be a Nonrecoverable Advance; and provided, further,
that the Monthly Payment for purposes of this Section 4.04 shall mean the minimum monthly payment due under the Mortgage Note, net of
the Servicing Fee and Subservicing Fee, (ii) withdraw from amounts on deposit in the Custodial Account and deposit in the Certificate
Account all or a portion of the Amount Held for Future Distribution in discharge of any such Advance, or (iii) make advances in the
form of any combination of (i) and (ii) aggregating the amount of such Advance. Any portion of the Amount Held for Future
Distribution so used shall be replaced by the Master Servicer by deposit in the Certificate Account on or before 11:00 A.M.
placeStateNew York time on any future Certificate Account Deposit Date to the extent that funds attributable to the Mortgage Loans
that are available in the Custodial Account for deposit in the Certificate Account on such Certificate Account Deposit Date shall be
less than payments to Certificateholders required to be made on the following Distribution Date. The Master Servicer shall be
entitled to use any Advance made by a Subservicer as described in Section 3.07(b) that has been deposited in the Custodial Account on
or before such Distribution Date as part of the Advance made by the Master Servicer pursuant to this Section 4.04. The amount of any
reimbursement pursuant to Section 4.02(a) in respect of outstanding Advances on any Distribution Date shall be allocated to specific
Monthly Payments due but delinquent for previous Due Periods, which allocation shall be made, to the extent practicable, to Monthly
Payments which have been delinquent for the longest period of time. Such allocations shall be conclusive for purposes of
reimbursement to the Master Servicer from recoveries on related Mortgage Loans pursuant to Section 3.10.
The determination by the Master Servicer that it has made a Nonrecoverable Advance or that any proposed Advance, if made,
would constitute a Nonrecoverable Advance, shall be evidenced by an Officers’ Certificate of the Master Servicer delivered to the
Company and the Trustee.
If the Master Servicer determines as of the Business Day preceding any Certificate Account Deposit Date that it will be
unable to deposit in the Certificate Account an amount equal to the Advance required to be made for the immediately succeeding
Distribution Date, it shall give notice to the Trustee of its inability to advance (such notice may be given by telecopy), not later
than 3:00 P.M., New York time, on such Business Day, specifying the portion of such amount that it will be unable to deposit. Not
later than 3:00 P.M., New York time, on the Certificate Account Deposit Date the Trustee shall, unless by 12:00 Noon, New York time,
on such day the Trustee shall have been notified in writing (by telecopy) that the Master Servicer shall have directly or indirectly
deposited in the Certificate Account such portion of the amount of the Advance as to which the Master Servicer shall have given
notice pursuant to the preceding sentence, pursuant to Section 7.01, (a) terminate all of the rights and obligations of the Master
Servicer under this Agreement in accordance with Section 7.01 and (b) assume the rights and obligations of the Master Servicer
hereunder, including the obligation to deposit in the Certificate Account an amount equal to the Advance for the immediately
succeeding Distribution Date.
The Trustee shall deposit all funds it receives pursuant to this Section 4.04 into the Certificate Account.
Section 4.05. Allocation of Realized Losses.
(a) Prior to each Distribution Date, the Master Servicer shall determine the total amount of Realized Losses, if any, that
resulted from any Cash Liquidation, Servicing Modifications, Debt Service Reduction, Deficient Valuation or REO Disposition that
occurred during the related Prepayment Period or, in the case of a Servicing Modification that constitutes a reduction of the
interest rate on a Mortgage Loan, the amount of the reduction in the interest portion of the Monthly Payment due in the month in
which such Distribution Date occurs. The amount of each Realized Loss shall be evidenced by an Officers’ Certificate.
(i) (A) All Realized Losses on the Group I Loans shall be allocated or, with respect to clause (2) below, such Realized
Losses on the Group I Loans shall be reduced, as follows:
(1) first, to the Excess Cash Flow as part of the Principal Distribution Amount as provided in Section 4.02(c)(I), to the extent
of the Excess Cash Flow for such Distribution Date,
(2) second, by Net Swap Payments pursuant to Section 4.09(c);
(3) third,in reduction of the Overcollateralization Amount, until such amount has been reduced to zero;
(4) fourth,to the Class I-M-9 Certificates, until the Certificate Principal Balance thereof has been reduced to zero;
(5) fifth,to the Class I-M-8 Certificates, until the Certificate Principal Balance thereof has been reduced to zero;
(6) sixth, to the Class I-M-7 Certificates, until the Certificate Principal Balance thereof has been reduced to zero;
(7) seventh, to the Class I-M-6 Certificates, until the Certificate Principal Balance thereof has been reduced to zero;
(8) eighth, to the Class I-M-5 Certificates, until the Certificate Principal Balance thereof has been reduced to zero;
(9) ninth,to the Class I-M-4 Certificates, until the Certificate Principal Balance thereof has been reduced to zero;
(10) tenth,to the Class I-M-3 Certificates, until the Certificate Principal Balance thereof has been reduced to zero;
(11) eleventh,to the Class I-M-2 Certificates, until the Certificate Principal Balance thereof has been reduced to zero; and
(12) twelfth,to the Class I-M-1 Certificates, until the Certificate Principal Balance thereof has been reduced to zero.
(B) Any allocation of the principal portion of Realized Losses on the Group I Loans (other than Debt Service
Reductions) to Class I-M Certificates on any Distribution Date shall be made by reducing the Certificate Principal Balance
thereof by the amount so allocated, which allocation shall be deemed to have occurred on such Distribution Date, until the
Certificate Principal Balance thereof has been reduced to zero; provided, that no such reduction shall reduce the aggregate
Certificate Principal Balance of the Group I Certificates below the aggregate Stated Principal Balance of the Group I
Loans. Allocations of the interest portions of Realized Losses on the Group I Loans (other than any interest rate reduction
resulting from a Servicing Modification) to any Class I-M Certificates on any Distribution Date shall be made by operation
of the definition of “Accrued Certificate Interest” for each Class for such Distribution Date. Allocations of the interest
portion of a Realized Loss on the Group I Loans resulting from an interest rate reduction in connection with a Servicing
Modification shall be made by operation of the priority of payment provisions of Section 4.02(c)(I). All Realized Losses
and all other losses allocated to a Class of Group I Certificates hereunder will be allocated among the Certificates of such
Class in proportion to the Percentage Interests evidenced thereby.
(C) Realized Losses shall be allocated among the REMIC I Regular Interests pursuant to the definition of REMIC
I Realized Losses and the REMIC II Regular Interests pursuant to the definition of REMIC II Realized Losses.
(D) Realized Losses on the Group I Loans allocated to the Excess Cash Flow or the Overcollateralization Amount
pursuant to paragraphs (A), (B) or (C) of this Section 4.05(a)(i)(A), the definition of Accrued Certificate Interest and the
operation of Section 4.02(c)(I) shall be deemed allocated to the Class I-SB Certificates. Realized Losses on the Group I
Loans allocated to the Class I-SB Certificates shall, to the extent such Realized Losses represent Realized Losses on an
interest portion, be allocated to REMIC III Regular Interest I-SB-IO. Realized Losses on the Group I Loans allocated to the
Excess Cash Flow pursuant to paragraph (b) of this Section shall be deemed to reduce Accrued Certificate Interest on REMIC
III Regular Interest I-SB-IO. Realized Losses on the Group I Loans allocated to the Overcollateralization Amount pursuant to
paragraph (b) of this Section shall be deemed first to reduce the principal balance of REMIC III Regular Interest I-SB-PO
until such principal balance shall have been reduced to zero and thereafter to reduce accrued and unpaid interest on REMIC
III Regular Interest I-SB-IO.
(ii) All Realized Losses on the Group II Loans shall be allocated as follows::
Prior to each Distribution Date, the Master Servicer shall determine the total amount of Realized Losses on the Group
II Loans, if any, that resulted from any Cash Liquidation, Servicing Modification, Debt Service Reduction, Deficient Valuation
or REO Disposition that occurred during the related Prepayment Period or, in the case of a Servicing Modification that
constitutes a reduction of the interest rate on a Group II Loan, the amount of the reduction in the interest portion of the
Monthly Payment due during the related Due Period. The amount of each Realized Loss on the Group II Loans shall be evidenced
by an Officers’ Certificate. All Realized Losses on the Group II Loans, other than Excess Special Hazard Losses,
Extraordinary Losses, Excess Bankruptcy Losses or Excess Fraud Losses, shall be allocated as follows: first, to the Class
II-B-3 Certificates until the Certificate Principal Balance thereof has been reduced to zero; second, to the Class II-B-2
Certificates until the Certificate Principal Balance thereof has been reduced to zero; third, to the Class II-B-1 Certificates
until the Certificate Principal Balance thereof has been reduced to zero; fourth, to the Class II-M-3 Certificates until the
Certificate Principal Balance thereof has been reduced to zero; fifth, to the Class II-M-2 Certificates until the Certificate
Principal Balance thereof has been reduced to zero; sixth, to the Class II-M-1 Certificates until the Certificate Principal
Balance thereof has been reduced to zero; and, thereafter, such Realized Losses shall be allocated to the Group II Senior
Certificates, on a pro rata basis provided, however, that after the Credit Support Depletion Date, such Realized Losses
otherwise allocable to the Class II-A-1 Certificates will be allocated to the Class II-A-2 Certificates until the Certificate
Principal Balance of the Class II-A-2 Certificates has been reduced to zero. The Group II Senior Percentage of any Excess
Special Hazard Losses, Excess Bankruptcy Losses, Excess Fraud Losses or Extraordinary Losses on the Group II Loans shall be
allocated to the Group II Senior Certificates, on a pro rata basis. The remainder of such Realized Losses will be allocated
among the Class II-M Certificates and Class II-B Certificates on a pro rata basis.
On any Distribution Date, Realized Losses will be allocated as set forth herein before distributions of principal on
the Certificates as set forth herein.
As used herein, an allocation of a Realized Loss on a “pro rata basis” among two or more specified Classes of
Certificates means an allocation on a pro rata basis, among the various Classes so specified, to each such Class of
Certificates on the basis of their then outstanding Certificate Principal Balances prior to giving effect to distributions to
be made on such Distribution Date in the case of the principal portion of a Realized Loss or based on the Accrued Certificate
Interest thereon payable on such Distribution Date (without regard to any Compensating Interest for such Distribution Date) in
the case of an interest portion of a Realized Loss. Except as provided in the following sentence, any allocation of the
principal portion of Realized Losses (other than Debt Service Reductions) to a Class of Certificates shall be made by reducing
the Certificate Principal Balance thereof by the amount so allocated, which allocation shall be deemed to have occurred on
such Distribution Date; provided that no such reduction shall reduce the aggregate Certificate Principal Balance of the
Certificates below the aggregate Stated Principal Balance of the Mortgage Loans in the related loan group. Any allocation of
the principal portion of Realized Losses (other than Debt Service Reductions) to the Subordinate Certificates then outstanding
with the Lowest Priority shall be made by operation of the definition of “Certificate Principal Balance” and by operation of
the provisions of Section 4.02(a). Allocations of the interest portions of Realized Losses (other than any interest rate
reduction resulting from a Servicing Modification) shall be made in proportion to the amount of Accrued Certificate Interest
and by operation of the definition of “Accrued Certificate Interest” and by operation of the provisions of Section 4.02(a).
Allocations of the interest portion of a Realized Loss resulting from an interest rate reduction in connection with a
Servicing Modification shall be made by operation of the provisions of Section 4.02(a). Allocations of the principal portion
of Debt Service Reductions shall be made by operation of the provisions of Section 4.02(a). All Realized Losses and all other
losses allocated to a Class of Certificates hereunder will be allocated among the Certificates of such Class in proportion to
the Percentage Interests evidenced thereby.
Realized Losses shall be allocated among the Uncertificated REMIC I Regular Interests as specified in the definition of
REMIC I Realized Losses.
Realized Losses shall be allocated among the Uncertificated REMIC II Regular Interests as specified in the definition of
REMIC II Realized Losses.
Section 4.06. Reports of Foreclosures and Abandonment of Mortgaged Property. (See Section 4.06 of the Standard Terms.)
Section 4.07. Optional Purchase of Defaulted Mortgage Loans. (See Section 4.07 of the Standard Terms.)
Section 4.08. Surety Bond. (See Section 4.08 of the Standard Terms.)
Section 4.09. Swap Agreement.
(a) On the Closing Date, the Trustee shall (i) establish and maintain in its name, in trust for the benefit of the
Certificateholders, the Swap Account and (ii) for the benefit of the Certificateholders, cause the Trust to enter into the Swap
Agreement.
(b) The Trustee shall deposit in the Swap Account all payments that are payable to the Trust Fund under the Swap Agreement. Net
Swap Payments and Swap Termination Payments (other than Swap Termination Payments resulting from a Swap Counterparty Trigger Event)
payable by the Trust Fund to the Swap Counterparty pursuant to the Swap Agreement shall be excluded from the Available Distribution
Amount and payable to the Swap Counterparty prior to any distributions to the Certificateholders. On each Distribution Date, such
amounts will be remitted by the Trustee to the Swap Account for payment to the Swap Counterparty, first to make any Net Swap Payment
owed to the Swap Counterparty pursuant to the Swap Agreement for such Distribution Date, and second to make any Swap Termination
Payment (not due to a Swap Counterparty Trigger Event) owed to the Swap Counterparty pursuant to the Swap Agreement for such
Distribution Date. For federal income tax purposes, such amounts paid to the Swap Account on each Distribution Date shall first be
deemed paid to the Swap Account in respect of REMIC III Regular Interest IO to the extent of the amount distributable on such
REMIC III Regular Interest IO on such Distribution Date, and any remaining amount shall be deemed paid to the Swap Account in respect
of the SB-AM Swap Agreement. Any Swap Termination Payment triggered by a Swap Counterparty Trigger Event owed to the Swap
Counterparty pursuant to the Swap Agreement will be subordinated to distributions to the Holders of the Class I-A Certificates and
Class I-M Certificates and shall be paid as set forth under Section 4.02 and 4.09(c).
(c) Net Swap Payments payable by the Swap Counterparty to the Trustee on behalf of the Trust Fund pursuant to the Swap Agreement
will be deposited by the Trustee into the Swap Account. On each Distribution Date, to the extent required, the Trustee shall
withdraw such amounts from the Swap Account to distribute to the Certificates in the following order of priority, after giving effect
to distributions of Excess Cashflow pursuant to Section 4.02(c)(I)(i)(C), 4.02(c)(I)(i)(D) and 4.02(c)(I)(i)(E):
(A) first, to pay any Net Swap Payment owed to the Swap Counterparty pursuant to the Swap Agreement that remain unpaid from
previous Distribution Dates;
(B) second, to pay any Swap Termination Payment to the Swap Counterparty, other than any Swap Termination Payments owed to the
Swap Counterparty due to a Swap Counterparty Trigger Event;
(C) third, to pay to the Class I-A Certificates pro rata any Accrued Certificate Interest on such Distribution Date and
remaining unpaid from prior Distribution Dates together with interest thereon;
(D) fourth, to pay to the holders of the Class I-M Certificates, in order of priority, any Accrued Certificate Interest on such
Distribution Date and remaining unpaid from prior Distribution Dates together with interest thereon;
(E) fifth, as part of the Group I Principal Distribution Amount, to pay to the Class I-A Certificates and Class I-M Certificates
an amount equal to the lesser of: (i) any Overcollateralization Increase Amount and (ii) the principal portion of any
Realized Losses previously allocated thereto that remain unreimbursed;
(F) sixth, to pay concurrently to the holders of the Class I-A Certificates the amount of any Basis Risk Shortfall Carry-Forward
Amount for such Class as of such Distribution Date up to the respective Swap Payment Allocation for that Distribution Date;
(G) seventh, to pay to the holders of the Class I-M Certificates, according to the priority set forth in 4.02(c)(I)(i)(A), the
amount of any Basis Risk Shortfall Carry-Forward Amount for such Class as of such Distribution Date up to the respective
Swap Payment Allocation for that Distribution Date;
(H) eighth, to pay concurrently to the Class I-A Certificates and Class I-M Certificates, pro rata based on the respective
amounts of any Basis Risk Shortfall Carry-Forward Amount for such Class for such Distribution Date remaining unpaid as of
that Distribution Date, the amount of such Basis Risk Shortfall Carry-Forward Amounts;
(I) ninth, to the Class I-M Certificates, in order of priority, the principal portion of any Realized Losses previously
allocated thereto that remain unreimbursed;
(J) tenth, to pay any Swap Termination Payments owed to the Swap Counterparty due to a Swap Counterparty Trigger Event; and
(K) eleventh, to pay the Class I-SB Certificates any balance remaining.
(d) Subject to Sections 8.01 and 8.02 of the Standard Terms, the Trustee agrees to comply with the terms of the Swap Agreement
and to enforce the terms and provisions thereof against the Swap Counterparty at the written direction of the Holders of Certificates
entitled to at least 51% of the Voting Rights, or if the Trustee does not receive such direction from such Certificateholders, then
at the written direction of Residential Funding.
(e) The Swap Account shall be an Eligible Account. Amounts held in the Swap Account from time to time shall continue to
constitute assets of the Trust Fund, but not of the REMICs, until released from the Swap Account pursuant to this Section 4.09. The
Swap Account constitutes an “outside reserve fund” within the meaning of Treasury Regulation Section 1.860G-2(h) and is not an asset
of the REMICs. The Class I-SB Certificateholders shall be the owners of the Swap Account. The Trustee shall keep records that
accurately reflect the funds on deposit in the Swap Account. The Trustee shall, at the written direction of the Master Servicer,
invest amounts on deposit in the Swap Account in Permitted Investments. In the absence of written direction to the Trustee from the
Master Servicer, all funds in the Swap Account shall remain uninvested.
(f) The Trustee shall enter into the SB-AM Swap Agreement on behalf of the holders of the Class I-A Certificates and Class I-M
Certificates on the one hand, and on behalf of the holders of the Class I-SB Certificates on the other hand. Pursuant to the SB-AM
Swap Agreement, all holders of Certificates (other than the Class I-SB Certificate, Class I-P and Class I-R Certificates) shall be
treated as having agreed to pay, on each Distribution Date, to the holder of the Class I-SB Certificates an aggregate amount equal to
the excess, if any, of (i) the amount payable on such Distribution Date on the REMIC III Regular Interest corresponding to such Class
of Certificates over (ii) the amount payable on such Class of Certificates on such Distribution Date (such excess, a “Class IO
Distribution Amount”). In addition, pursuant to the SB-AM Swap Agreement, the holders of the Class I-SB Certificates shall be
treated as having agreed to pay the related Basis Risk Shortfalls to the holders of the Certificates (other than the Class I-SB,
Class I-P and Class I-R Certificates) in accordance with the terms of this Agreement. Any payments to the Certificates from amounts
deemed received in respect of the SB-AM Swap Agreement shall not be payments with respect to a “regular interest” in a REMIC within
the meaning of Code Section 860G(a)(1). However, any payment from the Certificates (other than the Class I-SB Certificates and Class
I-R Certificates) of a Class IO Distribution Amount shall be treated for tax purposes as having been received by the holders of such
Certificates in respect of the REMIC III Regular Interest corresponding to such Class of Certificates and as having been paid by such
holders to the Swap Account pursuant to the SB-AM Swap Agreement. Thus, each Certificate (other than the Class I-R Certificates)
shall be treated as representing not only ownership of regular interests in REMIC III, but also ownership of an interest in, and
obligations with respect to, a notional principal contract.
(g) Upon the occurrence of an Early Termination Date, the Trustee shall use reasonable efforts to appoint a successor swap
counterparty. To the extent that the Trustee receives a Swap Termination Payment from the Swap Counterparty, the Trustee shall apply
such Swap Termination Payment to appoint a successor swap counterparty. In the event that the trust receives a Swap Termination
Payment from the Swap Counterparty and a replacement swap agreement or similar agreement cannot be obtained within 30 days after
receipt by the Trustee of such Swap Termination Payment, then the Trustee shall deposit such Swap Termination Payment into a
separate, non interest bearing account and will, on each subsequent Distribution Date, withdraw from the amount then remaining on
deposit in such reserve account an amount equal to the Net Swap Payment, if any, that would have been paid to the Trust by the
original Swap Counterparty calculated in accordance with the terms of the original Swap Agreement, and deposit such amount into the
Swap Account for distribution on such Distribution Date pursuant to Section 4.02(c). To the extent that the Trust is required to pay
a Swap Termination Payment to the Swap Counterparty, any upfront payment received from the counterparty to a replacement swap
agreement will be used to pay such Swap Termination Payment prior to using any portion of the Available Distribution Amount for such
Distribution Date.
Section 4.10. Class P Reserve Account
(a) The Trustee shall establish a Class P Reserve Account on behalf of the Holders of the Class P Certificates. The
Class P Reserve Account must be an Eligible Account. The Class P Reserve Account shall be entitled “Class P Reserve Account, Deutsche
Bank Trust Company Americas, as Trustee for the benefit of holders of Residential Accredit Loans, Inc., Mortgage Asset-Backed
Pass-Through Certificates, Series 2006-QA5,” (the “Class P Reserve Account”). On the Closing Date, the Depositor will cause, on
behalf of the Trust, the Class P Reserve Account Amount to be deposited into the Class P Reserve Account. In addition, all amounts
received by the Master Servicer in connection with Prepayment Charges on the Prepayment Charge Loans shall be remitted by the Master
Servicer on the Certificate Account Deposit Date to the Trustee and shall be deposited by the Trustee into the Class P Reserve
Account, at the direction of the Master Servicer, upon receipt thereof. Funds on deposit in the Class P Reserve Account shall be
held in trust by the Trustee for the holder of the Class P Certificates.
(b) On the Business Day prior to each Distribution Date, the Trustee shall withdraw the amount then on deposit in the
Class P Reserve Account representing Prepayment Charges in respect of the Prepayment Charge Loans in Loan Group I received during the
related Prepayment Period and deposit such amount into the Certificate Account to be distributed to the Holders of the Class I-P
Certificates in accordance with Section 4.02(f). On the Business Day prior to each Distribution Date, the Trustee shall withdraw the
amount then on deposit in the Class P Reserve Account representing Prepayment Charges in respect of the Prepayment Charge Loans in
Loan Group II received during the related Prepayment Period and deposit such amount into the Certificate Account to be distributed to
the Holders of the Class II-P Certificates in accordance with Section 4.02(f).
ARTICLE V
THE CERTIFICATES
Section 5.01. The Certificates.
(A) The Class I-A Certificates and Class II-A Certificates, Class I-M Certificates and Class II-M Certificates, Class II-B
Certificates and Class I-R Certificates and Class I-R Certificates shall be substantially in the forms set forth in Exhibits A, B, C
and D to the Standard Terms, respectively, and the Class I-SB Certificates and Class P Certificates shall be substantially in the
forms set forth in Exhibits 6 and 7, hereto, respectively, and shall, on original issue, be executed and delivered by the Trustee to
the Certificate Registrar for authentication and delivery to or upon the order of the Company upon receipt by the Trustee or
Custodian of the documents specified in Section 2.01. The Certificates shall be issuable in the minimum denominations designated in
the Preliminary Statement.
The Certificates shall be executed by manual or facsimile signature on behalf of an authorized officer of the Trustee.
Certificates bearing the manual or facsimile signatures of individuals who were at any time the proper officers of the Trustee shall
bind the Trustee, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication
and delivery of such Certificate or did not hold such offices at the date of such Certificates. No Certificate shall be entitled to
any benefit under this Agreement, or be valid for any purpose, unless there appears on such Certificate a certificate of
authentication substantially in the form provided for herein executed by the Certificate Registrar by manual signature, and such
certificate upon any Certificate shall be conclusive evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder. All Certificates shall be dated the date of their authentication.
Section 5.02. Registration of Transfer and Exchange of Certificates
(a) (See Section 5.02(a) of the Standard Terms)
(b) Upon surrender for registration of transfer of any Certificate at any office or agency of the Trustee maintained for such
purpose pursuant to Section 8.12 and, in the case of any Class M, Class I-SB, Class P or Class I-R Certificate, upon satisfaction of
the conditions set forth below, the Trustee shall execute and the Certificate Registrar shall authenticate and deliver, in the name
of the designated transferee or transferees, one or more new Certificates of a like Class (or Subclass) and aggregate Percentage
Interest.
(c) (See Section 5.02(c) of the Standard Terms)
(d) No transfer, sale, pledge or other disposition of a Class I-SB, Class II-B or Class P Certificate shall be made unless such
transfer, sale, pledge or other disposition is exempt from the registration requirements of the Securities Act of 1933, as amended,
and any applicable state securities laws or is made in accordance with said Act and laws. In the event that a transfer of a Class
I-SB, Class II-B or Class P Certificate is to be made either (i)(A) the Trustee shall require a written Opinion of Counsel acceptable
to and in form and substance satisfactory to the Trustee and the Company that such transfer may be made pursuant to an exemption,
describing the applicable exemption and the basis therefor, from said Act and laws or is being made pursuant to said Act and laws,
which Opinion of Counsel shall not be an expense of the Trustee, the Company or the Master Servicer (except that, if such transfer is
made by the Company or the Master Servicer or any Affiliate thereof, the Company or the Master Servicer shall provide such Opinion of
Counsel at their own expense); provided that such Opinion of Counsel will not be required in connection with the initial transfer of
any such Certificate by the Company or any Affiliate thereof to the Company or an Affiliate of the Company and (B) the Trustee shall
require the transferee to execute a representation letter, substantially in the form of Exhibit H to the Standard Terms, and the
Trustee shall require the transferor to execute a representation letter, substantially in the form of Exhibit I to the Standard
Terms, each acceptable to and in form and substance satisfactory to the Company and the Trustee certifying to the Company and the
Trustee the facts surrounding such transfer, which representation letters shall not be an expense of the Trustee, the Company or the
Master Servicer; provided, however, that such representation letters will not be required in connection with any transfer of any such
Certificate by the Company or any Affiliate thereof to the Company or an Affiliate of the Company, and the Trustee shall be entitled
to conclusively rely upon a representation (which, upon the request of the Trustee, shall be a written representation) from the
Company, of the status of such transferee as an Affiliate of the Company or (ii) the prospective transferee of such a Certificate
shall be required to provide the Trustee, the Company and the Master Servicer with an investment letter substantially in the form of
Exhibit J attached to the Standard Terms (or such other form as the Company in its sole discretion deems acceptable), which
investment letter shall not be an expense of the Trustee, the Company or the Master Servicer, and which investment letter states
that, among other things, such transferee (A) is a “qualified institutional buyer” as defined under Rule 144A, acting for its own
account or the accounts of other “qualified institutional buyers” as defined under Rule 144A, and (B) is aware that the proposed
transferor intends to rely on the exemption from registration requirements under the Securities Act of 1933, as amended, provided by
Rule 144A. The Holder of any such Certificate desiring to effect any such transfer, sale, pledge or other disposition shall, and does
hereby agree to, indemnify the Trustee, the Company, the Master Servicer and the Certificate Registrar against any liability that may
result if the transfer, sale, pledge or other disposition is not so exempt or is not made in accordance with such federal and state
laws.
(e) (i) Any Transferee of any Group I Certificate will be deemed to have represented by virtue of its purchase or
holding of such Certificate (or interest therein) that such transferee is not an employee benefit plan or other plan
or arrangement subject to the prohibited transaction provisions of the Employee Retirement Income Security Act of
1974, as amended (“ERISA”), or Section 4975 of the Code or a person (including an insurance company investing its
general account, an investment manager, a named fiduciary or a trustee of any such plan) who is using “plan assets”
of any such plan to effect such acquisition (each, a "Plan Investor"). In the case of any Group I Certificate
presented for registration in the name of any Person, the prospective transferee shall be required to provide the
Trustee, the Depositor and the Master Servicer with a certification to the effect set forth in Exhibit 8 hereto
(with respect to a Class I-A Certificate, Class I-M Certificate, Class I-P or Class SB Certificate, provided,
however that such certification shall be deemed to have been given by any Class A Certificate or Class M
Certificateholder who acquires a Book-Entry Certificate) or in paragraph fifteen of Exhibit H-1 of the Standard
Terms (with respect to a Class R Certificate), which the Trustee may rely upon without further inquiry or
investigation, or such other certifications as the Trustee may deem desirable or necessary in order to establish
that such transferee or the Person in whose name such registration is requested is not a Plan Investor.
(ii) In the case of any Class II-B, Class II-P or Class II-R-1 Certificate presented for registration in the
name of any Person, either (A) the Trustee shall require an Opinion of Counsel acceptable to and in form and
substance satisfactory to the Trustee, the Company and the Master Servicer to the effect that the purchase or
holding of such Class II-B, Class II-P or Class II-R-I Certificate is permissible under applicable law, will not
constitute or result in any non-exempt prohibited transaction under Section 406 of the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”), or Section 4975 of the Code (or comparable provisions of any subsequent
enactments), and will not subject the Trustee, the Company or the Master Servicer to any obligation or liability
(including obligations or liabilities under ERISA or Section 4975 of the Code) in addition to those undertaken in
this Agreement, which Opinion of Counsel shall not be an expense of the Trustee, the Company or the Master Servicer
or (B) the prospective Transferee shall be required to provide the Trustee, the Company and the Master Servicer with
a certification to the effect set forth in paragraph six of Exhibit H of the Standard Terms (with respect to any
Class II-B Certificate or Class II-P Certificate) or paragraph fifteen of Exhibit G-1 of the Standard Terms (with
respect to any Class II-R-I Certificate), which the Trustee may rely upon without further inquiry or investigation,
or such other certifications as the Trustee may deem desirable or necessary in order to establish that such
Transferee or the Person in whose name such registration is requested either (a) is not a Plan Investor or (b) in
the case of any Class II-B Certificate, the following conditions are satisfied: (i) such Transferee is an insurance
company, (ii) the source of funds used to purchase or hold such Certificate (or interest therein) is an “insurance
company general account” (as defined in U.S. Department of Labor Prohibited Transaction Class Exemption (“PTCE”)
95-60, and (iii) the conditions set forth in Sections I and III of PTCE 95-60 have been satisfied (each entity that
satisfies this clause (b), a “Complying Insurance Company”).
(iii) Any Transferee of a Class II-M Certificate will be deemed to have represented by virtue of its purchase or
holding of such Certificate (or interest therein) that either (a) such Transferee is not a Plan Investor, (b) it has
acquired and is holding such Certificate in reliance on Prohibited Transaction Exemption (“PTE”) 94-29, 59 Fed. Reg.
14674 (March 29, 1994), as amended by PTE 97-34, 62 Fed. Reg. 39021 (July 21, 1997), PTE 2000-58, 65 Fed. Reg. 67765
(November 13, 2000), and PTE 2002-41, 67 Fed. Reg. 54487 (August 22, 2002) (the “RFC Exemption”), and that it
understands that there are certain conditions to the availability of the RFC Exemption including that such
Certificate must be rated, at the time of purchase, not lower than “BBB-” (or its equivalent) by Standard & Poor’s,
Fitch or Xxxxx’x or (c) such Transferee is a Complying Insurance Company.
(iv) (A) If any Class II-M Certificate (or any interest therein) is acquired or held by any Person that does
not satisfy the conditions described in paragraph (ii) above, then the last preceding Transferee that either (i) is
not a Plan Investor, (ii) acquired such Certificate in compliance with the RFC Exemption, or (iii) is a Complying
Insurance Company shall be restored, to the extent permitted by law, to all rights and obligations as Certificate
Owner thereof retroactive to the date of such Transfer of such Class M Certificate. The Trustee shall be under no
liability to any Person for making any payments due on such Certificate to such preceding Transferee.
(B) Any purported Certificate Owner whose acquisition or holding of any Class II-M Certificate (or
interest therein) was effected in violation of the restrictions in this Section 5.02(e) shall indemnify and hold
harmless the Company, the Trustee, the Master Servicer, any Subservicer, the Underwriters and the Trust Fund from
and against any and all liabilities, claims, costs or expenses incurred by such parties as a result of such
acquisition or holding.
(f) (See Section 5.02(f) of the Standard Terms)
(g) (See Section 5.02(g) of the Standard Terms)
(h) (See Section 5.02(h) of the Standard Terms)
Section 5.03. Mutilated, Destroyed, Lost or Stolen Certificates(See Section 5.03 of the Standard Terms)
Section 5.04. Persons Deemed Owners (See Section 5.04 of the Standard Terms)
Section 5.05. Appointment of Paying Agent (See Section 5.04 of the Standard Terms)
placecountry-regionSection 5.06. U.S.A. Patriot Act Compliance (See Section 5.05 of the Standard Terms)
ARTICLE VI
THE COMPANY AND THE MASTER SERVICER
Section 6.01. Respective Liabilities of the Company and Master Servicer. (See Section 6.01 of the Standard Terms.)
Section 6.02. Merger or Consolidation of the Company or Master Servicer; Assignment of Rights and Delegation of Duties by the
Master Servicer. (
(a) (See Section 6.08(a) of the Standard Terms.).
(b) Any Person into which the Depositor or the Master Servicer may be merged or converted or with which it may be
consolidated, or any Person resulting from any merger, conversion or consolidation to which the Depositor or the Master Servicer
shall be a party, or any Person succeeding to the business of the Depositor or the Master Servicer, shall be the successor of the
Depositor or the Master Servicer, as the case may be, hereunder, without the execution or filing of any paper or any further act on
the part of any of the parties hereto, anything in this Section 6.02(b) to the contrary notwithstanding; provided, however, that the
successor or surviving Person to the Master Servicer shall be qualified to service mortgage loans on behalf of Xxxxxx Xxx or Freddie
Mac; and provided further that each Rating Agency’s ratings, if any, of any Class of Class A Certificates or Class M Certificates in
effect immediately prior to such merger or consolidation will not be qualified, reduced or withdrawn as a result thereof (as
evidenced by a letter to such effect from each Rating Agency).
(c) (See Section 6.08(c) of the Standard Terms).
(d) Notwithstanding anything else in this Section 6.02 to the contrary, the conversion of Residential Funding
Corporation’s or Residential Accredit Loans, Inc.'s organizational structure from a Delaware corporation to a limited liability
company shall not require the consent of any party or notice to any party and shall not in any way affect the rights or obligations
of Residential Funding Corporation or Residential Accredit Loans, Inc. hereunder.
Section 6.03. Limitation on Liability of the Company, Master Servicer and Others. (See Section 6.03 of the Standard Terms.)
Section 6.04. Company and Master Servicer Not to Resign. (See Section 6.04 of the Standard Terms.)
ARTICLE VII
DEFAULT
(See Article VII of the Standard Terms.)
ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.01. Duties of the Trustee. (See Section 8.01 of the Standard Terms).
Section 8.02. Certain Matters Affecting the Trustee. (See Section 8.02 of the Standard Terms).
Section 8.03. Trustee Not Liable for Certificates or Mortgage Loans. (See Section 8.03 of the Standard Terms).
Section 8.04. Trustee May Own Certificates. (See Section 8.04 of the Standard Terms).
Section 8.05. Master Servicer to Pay Trustee's Fees and Expenses; Indemnification.
(a) (See Section 8.05 of the Standard Terms).
(b) The Master Servicer agrees to indemnify the Trustee for, and to hold the Trustee harmless against, any
loss, liability or expense incurred without negligence or willful misconduct on the Trustee’s part, arising out of, or in connection
with, the acceptance and administration of the Trust Fund, including the costs and expenses (including reasonable legal fees and
expenses) of defending itself against any claim in connection with the exercise or performance of any of its powers or duties under
this Agreement, the Swap Agreement and the Custodial Agreement, and the Master Servicer further agrees to indemnify the Trustee for,
and to hold the Trustee harmless against, any loss, liability or expense arising out of, or in connection with, the provisions set
forth in the second paragraph of Section 2.01(c) hereof, including, without limitation, all costs, liabilities and expenses
(including reasonable legal fees and expenses) of investigating and defending itself against any claim, action or proceeding, pending
or threatened, relating to the provisions of this paragraph, provided that:
(i) with respect to any such claim, the Trustee shall have given the Master Servicer written notice thereof promptly after the
Trustee shall have actual knowledge thereof;
(ii) while maintaining control over its own defense, the Trustee shall cooperate and consult fully with the Master Servicer in
preparing such defense; and
(iii) notwithstanding anything in this Agreement to the contrary, the Master Servicer shall not be liable for settlement of any
claim by the Trustee entered into without the prior consent of the Master Servicer which consent shall not be unreasonably
withheld.
No termination of this Agreement shall affect the obligations created by this Section 8.05(b) of the Master Servicer to
indemnify the Trustee under the conditions and to the extent set forth herein.
Notwithstanding the foregoing, the indemnification provided by the Master Servicer in this Section 8.05(b) shall not be
available (A) for any loss, liability or expense of the Trustee, including the costs and expenses of defending itself against any
claim, incurred in connection with any actions taken by the Trustee at the direction of the Certificateholders pursuant to the terms
of this Agreement or (B) where the Trustee is required to indemnify the Master Servicer pursuant to Section 12.05(a).
Section 8.06. Eligibility Requirements for Trustee. (See Section 8.06 of the Standard Terms).
Section 8.07 Resignation and Removal of the Trustee. (See Section 8.07 of the Standard Terms).
Section 8.08 Successor Trustee. (See Section 8.08 of the Standard Terms).
Section 8.09 Merger or Consolidation of Trustee. (See Section 8.09 of the Standard Terms).
Section 8.10 Appointment of Co-Trustee or Separate Trustee. (See Section 8.10 of the Standard Terms).
Section 8.11 Appointment of Custodians. (See Section 8.11 of the Standard Terms).
Section 8.12 Appointment of Office or Agency. (See Section 8.12 of the Standard Terms).
Section 8.12 Swap Agreement.
The Trustee is hereby authorized and directed to, and agrees that it shall, enter into the Swap Agreement on behalf
of the Trust Fund.
ARTICLE IX
TERMINATION
Section 9.01. Optional Purchase by the Master Servicer of All Certificates; Termination Upon Purchase by the Master Servicer or
Liquidation of All Mortgage Loans
(a) Subject to Section 9.02, the respective obligations and responsibilities of the Company, the Master Servicer and the Trustee
created hereby in respect of the Certificates (other than the obligation of the Trustee to make certain payments after the Final
Distribution Date to Certificateholders and the obligation of the Company to send certain notices as hereinafter set forth) shall
terminate upon the last action required to be taken by the Trustee on the Final Distribution Date pursuant to this Article IX
following the earlier of:
(i) the later of the final payment or other liquidation (or any Advance with respect thereto) of the last
Mortgage Loan remaining in the Trust Fund or the disposition of all property acquired upon foreclosure or deed in lieu of
foreclosure of any Mortgage Loan, or
(ii) at the option of the Master Servicer, (X) the purchase of all Group I Loans and all property acquired in
respect of any Mortgage Loan remaining in Loan Group I, at a price equal to the sum of (A) 100% of the unpaid principal
balance of each Mortgage Loan in Loan Group I (or, if less than such unpaid principal balance, the fair market value of the
related underlying property of such Mortgage Loan with respect to Mortgage Loans as to which title has been acquired if such
fair market value is less than such unpaid principal balance) on the day of repurchase, plus accrued interest thereon at the
Net Mortgage Rate (or Modified Net Mortgage Rate in the case of any Modified Mortgage Loan), to, but not including, the first
day of the month in which such repurchase price is distributed, and (B) any unpaid Swap Termination Payment payable to the
Swap Counterparty (or any Swap Termination Payment payable to the Swap Counterparty as a result of the exercise of the option
provided for in this Section 9.01(a)(ii)(X)); and (Y) the purchase of all Group II Loans and all property acquired in respect
of any Mortgage Loan remaining in Loan Group II, at a price equal to 100% of the unpaid principal balance of each Mortgage
Loan in Loan Group II (or, if less than such unpaid principal balance, the fair market value of the related underlying
property of such Mortgage Loan with respect to Mortgage Loans as to which title has been acquired if such fair market value is
less than such unpaid principal balance) on the day of repurchase, plus accrued interest thereon at the Net Mortgage Rate (or
Modified Net Mortgage Rate in the case of any Modified Mortgage Loan), to, but not including, the first day of the month in
which such repurchase price is distributed; provided, however, that in no event shall the trust created hereby continue beyond
the expiration of 21 years from the death of the last survivor of the descendants of Xxxxxx X. Xxxxxxx, the late ambassador of
the United States to the Court of St. Xxxxx, living on the date hereof; and provided further, that the purchase price set
forth above shall be increased as is necessary, as determined by the Master Servicer, to avoid disqualification of any REMIC
created hereunder as a REMIC. The purchase price paid by the Master Servicer, pursuant to Section 9.01(a)(ii) shall also
include any amounts owed by Residential Funding pursuant to the last paragraph of Section 4 of the Assignment Agreement in
respect of any liability, penalty or expense that resulted from a breach of the representation and warranty set forth in
clause (xlvii) of Section 4 of the Assignment Agreement that remain unpaid on the date of such purchase.
The right of the Master Servicer to purchase all of the Mortgage Loans in Loan Group I or all of the Mortgage Loans
in Loan Group II, as applicable, pursuant to clause (ii) above is conditioned upon the Pool Stated Principal Balance of the Mortgage
Loans in such Loan Group as of the Final Distribution Date, prior to giving effect to distributions to be made on such Distribution
Date, being less than ten percent of the Cut-off Date Principal Balance of the Mortgage Loans in such Loan Group.
If such right is exercised by the Master Servicer, the Master Servicer shall be deemed to have been reimbursed for the full
amount of any unreimbursed Advances theretofore made by it with respect to the Mortgage Loans. In addition, the Master Servicer
shall provide to the Trustee the certification required by Section 3.15 and the Trustee and any Custodian shall, promptly following
payment of the purchase price, release to the Master Servicer the Mortgage Files pertaining to the Mortgage Loans being purchased.
In addition to the foregoing, on any Distribution Date on which the Stated Principal Balance of the Mortgage Loans in Loan
Group I, prior to giving effect to distributions to be made on such Distribution Date, is less than ten percent of the Cut-off Date
Principal Balance of the Mortgage Loans in Loan Group I, the Master Servicer shall have the right, at its option, to purchase the
Group I Certificates in whole, but not in part, at a price equal to the outstanding Certificate Principal Balance of such
Certificates plus the sum of Accrued Certificate Interest thereon for the related Interest Accrual Period and any previously unpaid
Accrued Certificate Interest, and any unpaid Prepayment Interest Shortfalls previously allocated thereto and, in the case of
Prepayment Interest Shortfalls, accrued interest thereon at the applicable Pass-Through Rate. If the Master Servicer exercises this
right to purchase the outstanding Group I Certificates, the Master Servicer will promptly terminate the respective obligations and
responsibilities created hereby in respect of these Certificates pursuant to this Article IX.
In addition to the foregoing, on any Distribution Date on which the Stated Principal Balance of the Mortgage Loans in Loan
Group II, prior to giving effect to distributions to be made on such Distribution Date, is less than ten percent of the Cut-off Date
Principal Balance of the Mortgage Loans in Loan Group II, the Master Servicer shall have the right, at its option, to purchase the
Group II Certificates in whole, but not in part, at a price equal to the outstanding Certificate Principal Balance of such
Certificates plus the sum of Accrued Certificate Interest thereon for the related Interest Accrual Period and any previously unpaid
Accrued Certificate Interest, and any unpaid Prepayment Interest Shortfalls previously allocated thereto and, in the case of
Prepayment Interest Shortfalls, accrued interest thereon at the applicable Pass-Through Rate. If the Master Servicer exercises this
right to purchase the outstanding Group II Certificates, the Master Servicer will promptly terminate the respective obligations and
responsibilities created hereby in respect of these Certificates pursuant to this Article IX.
(b) The Master Servicer shall give the Trustee not less than 40 days prior notice of the Distribution Date on which (1)
the Master Servicer anticipates that the final distribution will be made to Certificateholders as a result of the exercise by the
Master Servicer of its right to purchase the Mortgage Loans or on which (2) the Master Servicer anticipates that the Certificates
will be purchased as a result of the exercise by the Master Servicer to purchase the outstanding Certificates. Notice of any
termination, specifying the anticipated Final Distribution Date (which shall be a date that would otherwise be a Distribution Date)
upon which the Certificateholders may surrender their Certificates to the Trustee (if so required by the terms hereof) for payment of
the final distribution and cancellation or notice of any purchase of the outstanding Certificates, specifying the Distribution Date
upon which the Holders may surrender their Certificates to the Trustee for payment, shall be given promptly by the Master Servicer,
or by the Trustee (in any other case) by letter to the Certificateholders (with a copy to the Certificate Registrar) mailed (or
distributed through the Depository with respect to any Book-Entry Certificates) not earlier than the 15th day and not later than the
25th day of the month next preceding the month of such final distribution specifying:
(i) the anticipated Final Distribution Date upon which final payment of the Certificates is anticipated to be made upon
presentation and surrender of Certificates at the office or agency of the Trustee therein designated where required
pursuant to this Agreement or, in the case of the purchase by the Master Servicer of the outstanding Certificates,
the Distribution Date on which such purchase is to be made,
(ii) the amount of any such final payment, or in the case of the purchase of the outstanding Certificates, the purchase price, in
either case, if known, and
(iii) that the Record Date otherwise applicable to such Distribution Date is not applicable, and in the case of the Senior
Certificates, or in the case of all of the Certificates in connection with the exercise by the Master Servicer of
its right to purchase the Certificates, that payment will be made only upon presentation and surrender of the
Certificates at the office or agency of the Trustee therein specified.
If the Master Servicer or the Trustee is obligated to give notice to Certificateholders as required above, it shall give such
notice to the Certificate Registrar at the time such notice is given to Certificateholders and, if the Master Servicer is exercising
its rights to purchase the outstanding Certificates, it shall give such notice to each Rating Agency at the time such notice is given
to Certificateholders. In the event of a purchase of the Mortgage Loans by the Master Servicer, the Master Servicer shall deposit in
the Certificate Account before the Final Distribution Date in immediately available funds an amount equal to the purchase price
computed as provided above. As a result of the exercise by the Master Servicer of its right to purchase the outstanding
Certificates, the Master Servicer shall deposit in the Certificate Account before the Distribution Date on which such purchase is to
occur in immediately available funds an amount equal to the purchase price for the Certificates, computed as above provided, and
provide notice of such deposit to the Trustee. The Trustee will withdraw from such account the amount specified in subsection (c)
below and distribute such amount to the Certificateholders as specified in subsection (c) below. The Master Servicer shall provide
to the Trustee written notification of any change to the anticipated Final Distribution Date as soon as practicable. If the Trust
Fund is not terminated on the anticipated Final Distribution Date, for any reason, the Trustee shall promptly mail notice thereof to
each affected Certificateholder.
(c) (Y) In the case of the Group I Certificates, upon presentation and surrender of the Certificates by the Certificateholders
thereof, in connection with the exercise by the Master Servicer of its right to purchase such Certificates, and otherwise in
accordance with Section 4.01(a), the Trustee shall distribute to the holders of Group I Certificateholders (i) the amount otherwise
distributable on such Distribution Date, if not in connection with the Master Servicer’s election to repurchase the assets of the
Trust Fund or the outstanding Certificates, or (ii) if the Master Servicer elected to so repurchase the Mortgage Loans in Loan Group
I or the outstanding Class I-A Certificates, Class I-M Certificates and Class I-SB Certificates, an amount equal to the price paid
pursuant to Section 9.01(a) as follows: (A) with respect to each Certificate the outstanding Certificate Principal Balance thereof,
plus Accrued Certificate Interest for the related Interest Accrual Period thereon and any previously unpaid Accrued Certificate
Interest, subject to the priority set forth in Section 4.02(a), (B) with respect to the Class I-A Certificates and Class I-M
Certificates, the amount of any Prepayment Interest Shortfalls allocated thereto for such Distribution Date or remaining unpaid from
prior Distribution Dates and accrued interest thereon at the applicable Pass Through Rate, on a pro rata basis based on Prepayment
Interest Shortfalls allocated thereto for such Distribution Date or remaining unpaid from prior Distribution Dates, (C) to the Swap
Counterparty (without duplication of amounts payable to the Swap Counterparty on such date in accordance with Section 4.02) any Swap
Termination Payment payable to the Swap Counterparty then remaining unpaid or which is due to the exercise of any early termination
of the Trust Fund pursuant to this Section 9.01, and (D) to the Class I-SB Certificates, all remaining amounts. Notwithstanding the
reduction of the Certificate Principal Balance of any Class of Subordinate Certificates to zero, such Class will be outstanding
hereunder until the termination of the respective obligations and responsibilities of the Company, the Master Servicer and the
Trustee hereunder in accordance with Article IX.
(Z) In the case of the Group II Certificates, upon presentation and surrender of such Certificates by
the Certificateholders thereof, in connection with the exercise by the Master Servicer of its right to purchase such Certificates,
and otherwise in accordance with Section 4.01(a), the Trustee shall distribute to the Certificateholders (i) the amount otherwise
distributable on such Distribution Date, if not in connection with the Master Servicer’s election to repurchase the assets of the
Trust Fund or the outstanding Certificates, or (ii) if the Master Servicer elected to so repurchase the assets of the Trust Fund or
the outstanding Certificates, an amount determined as follows: (A) with respect to each Certificate the outstanding Certificate
Principal Balance thereof, plus Accrued Certificate Interest for the related Interest Accrual Period thereon and any previously
unpaid Accrued Certificate Interest, subject to the priority set forth in Section 4.02(a), and (B) with respect to the Class II-R
Certificates, any excess of the amounts available for distribution (including the repurchase price specified in clause (ii) of
subsection (a) of this Section) over the total amount distributed under the immediately preceding clause (A). Notwithstanding the
reduction of the Certificate Principal Balance of any Class of Group II Subordinate Certificates to zero, such Class will be
outstanding hereunder until the termination of the respective obligations and responsibilities of the Company, the Master Servicer
and the Trustee hereunder in accordance with Article IX.
(d) In the event that any Certificateholders shall not surrender their Certificates for final payment and cancellation on or
before the Final Distribution Date, the Master Servicer (if it exercised its right to purchase the Mortgage Loans) or the Trustee (in
any other case), shall give a second written notice to the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If within six months after the second notice any Certificate
shall not have been surrendered for cancellation, the Trustee shall take appropriate steps as directed by the Master Servicer to
contact the remaining Certificateholders concerning surrender of their Certificates. The costs and expenses of maintaining the
Certificate Account and of contacting Certificateholders shall be paid out of the assets which remain in the Certificate Account. If
within nine months after the second notice any Certificates shall not have been surrendered for cancellation, the Trustee shall pay
to the Master Servicer all amounts distributable to the holders thereof and the Master Servicer shall thereafter hold such amounts
until distributed to such Holders. No interest shall accrue or be payable to any Certificateholder on any amount held in the
Certificate Account or by the Master Servicer as a result of such Certificateholder’s failure to surrender its Certificate(s) for
final payment thereof in accordance with this Section 9.01 and the Certificateholders shall look only to the Master Servicer for such
payment.
(e) If any Certificateholders do not surrender their Certificates on or before the Distribution Date on which a purchase of the
outstanding Certificates is to be made, the Master Servicer shall give a second written notice to such Certificateholders to
surrender their Certificates for payment of the purchase price therefor. If within six months after the second notice any
Certificate shall not have been surrendered for cancellation, the Trustee shall take appropriate steps as directed by the Master
Servicer to contact the Holders of such Certificates concerning surrender of their Certificates. The costs and expenses of
maintaining the Certificate Account and of contacting Certificateholders shall be paid out of the assets which remain in the
Certificate Account. If within nine months after the second notice any Certificates shall not have been surrendered for cancellation
in accordance with this Section 9.01, the Trustee shall pay to the Master Servicer all amounts distributable to the Holders thereof
and shall have no further obligation or liability therefor and the Master Servicer shall thereafter hold such amounts until
distributed to such Holders. No interest shall accrue or be payable to any Certificateholder on any amount held in the Certificate
Account or by the Master Servicer as a result of such Certificateholder’s failure to surrender its Certificate(s) for payment in
accordance with this Section 9.01. Any Certificate that is not surrendered on the Distribution Date on which a purchase pursuant to
this Section 9.01 occurs as provided above will be deemed to have been purchased and the Holder as of such date will have no rights
with respect thereto except to receive the purchase price therefor minus any costs and expenses associated with such Certificate
Account and notices allocated thereto. Any Certificates so purchased or deemed to have been purchased on such Distribution Date
shall remain outstanding hereunder. The Master Servicer shall be for all purposes the Holder thereof as of such date.
ARTICLE X
REMIC PROVISIONS
Section 10.01. REMIC Administration. (See Section 10.01 of the Standard Terms.)
Section 10.02. Master Servicer; REMIC Administrator and Trustee Indemnification. (See Section 10.02 of the Standard Terms.)
Section 10.03. Designation of REMICs.
The REMIC Administrator will make an election to treat the segregated pool of assets described in the definition of REMIC I
(as defined herein) (including the Group I Loans but excluding the Swap Account, the Swap Agreement, the SB-AM Swap Agreement and the
Class P Reserve Account), and subject to this Agreement, as a REMIC (REMIC I) for federal income tax purposes. The REMIC
Administrator will make an election to treat the segregated pool of assets consisting of the REMIC I Regular Interests as a REMIC
(REMIC II) for federal income tax purposes. The REMIC Administrator will make an election to treat the segregated pool of assets
consisting of the REMIC II Regular Interests as a REMIC (REMIC III) for federal income tax purposes. The REMIC Administrator will
make an election to treat the segregated pool of assets described in the definition of REMIC II (as defined herein) (including the
Group II Loans but excluding the Class P Reserve Account), and subject to this Agreement, as a REMIC (REMIC IV) for federal income
tax purposes.
The REMIC I Regular Interests will be “regular interests” in REMIC I and the Class I-R-I Certificates will be the sole class
of “residual interests” in REMIC I for purposes of the REMIC Provisions (as defined herein) under the federal income tax law.
The REMIC II Regular Interests will be “regular interests” in REMIC II and the Class I-R-II Certificates will be the sole
class of “residual interests” in REMIC II for purposes of the REMIC Provisions (as defined herein) under the federal income tax law.
The REMIC III Regular Interests will be the “regular interests” in REMIC III, ownership of which will be represented by the
Class I-A Certificates, Class I-M-1 Certificates, Class I-M-2 Certificates, Class I-M-3 Certificates, Class I-M-4 Certificates, Class
I-M-5 Certificates, Class I-M-6 Certificates, Class I-M-7 Certificates, Class I-M-8 Certificates, Class I-M-9 Certificates and Class
I-SB Certificates, Class I-P Certificates and the Class I-R-III Certificates will represent the sole class of “residual interests” in
REMIC III for purposes of the REMIC Provisions (as defined herein) under federal income tax law.
The REMIC IV Regular Interests will be the “regular interests” in REMIC IV, ownership of which will be represented by the
Class II-A-1 Certificates, Class II-A-2 Certificates, Class II-M-1 Certificates, Class II-M-2 Certificates, Class II-M-3
Certificates, Class II-B-1 Certificates, Class II-B-2 Certificates, Class II-B-3 Certificates, Class II-P Certificates and the Class
II-R-I Certificates will be the sole class of “residual interests” in REMIC IV for purposes of the REMIC Provisions (as defined
herein) under the federal income tax law.
The Class P Certificates will not represent ownership of an interest in any REMIC.
Section 10.04. Distributions on the Uncertificated REMIC Regular Interests. (See Section 4.02 of this Series Supplement.)
Section 10.05. Compliance with Withholding Requirements.
Notwithstanding any other provision of this Agreement, the Trustee or any Paying Agent, as applicable, shall comply with all
federal withholding requirements respecting payments to Certificateholders, including interest or original issue discount payments or
advances thereof that the Trustee or any Paying Agent, as applicable, reasonably believes are applicable under the Code. The consent
of Certificateholders shall not be required for such withholding. In the event the Trustee or any Paying Agent, as applicable, does
withhold any amount from interest or original issue discount payments or advances thereof to any Certificateholder pursuant to
federal withholding requirements, the Trustee or any Paying Agent, as applicable, shall indicate the amount withheld to such
Certificateholder pursuant to the terms of such requirements.
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01. Amendment.
(a) (See Section 11.01(a) of the Standard Terms.)
(b) (See Section 11.01(b) of the Standard Terms.)
(c) (See Section 11.01(c) of the Standard Terms.)
(d) (See Section 11.01(d) of the Standard Terms.)
(e) (See Section 11.01(e) of the Standard Terms.)
(f) Notwithstanding anything to the contrary set forth in Sections 11.01 (b), (c), (d), and (e), any amendment of Sections
4.01(a) 4.02(c)(I)(i)(A)(H), 4.09, 8.12, 9.01 and 11.01 of this Agreement or defined terms used therein shall require the consent of
the Swap Counterparty as a third-party beneficiary of Sections 4.01(a) 4.02(c)(I)(i)(A)(H), 4.09, 8.12, 9.01 and 11.01 of this
Agreement.
Section 11.02. Recordation of Agreement; Counterparts. (See Section 11.02 of the Standard Terms.)
Section 11.03. Limitation on Rights of Certificateholders. (See Section 11.03 of the Standard Terms.)
Section 11.04. Governing Law. (See Section 11.04 of the Standard Terms.)
Section 11.05. Notices. All demands and notices hereunder shall be in writing and shall be deemed to have been duly given if
personally delivered at or mailed by registered mail, postage prepaid (except for notices to the Trustee which shall be deemed to
have been duly given only when received), to the appropriate address for each recipient listed in the table below or, in each case,
such other address as may hereafter be furnished in writing to the Master Servicer, the Trustee and the Company, as applicable:
--------------------------------------------- ------------------------------------------------------------------------
Recipient Address
--------------------------------------------- ------------------------------------------------------------------------
--------------------------------------------- ------------------------------------------------------------------------
Company addressStreet8400 Xxxxxxxxxx Xxxx Xxxxxxxxx
Xxxxx 000
XxxxXxxxxxxxxxx, XxxxxXxxxxxxxx PostalCode55437
Attention: President
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Master Servicer addressStreet2255 X. Xxxxxxx Xxxxxx, Xxxxx 000
XxxxXxxxxxx, XxxxxXxxxxxxxxx PostalCode91504-2130
Attention: Managing Director/Master Servicing
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Trustee Corporate Trust Office
addressStreet1761 Xxxx Xx. Xxxxxx Xxxxx
placeCitySanta Ana, StateCalifornia PostalCode92705-4934,
Attention: Residential Accredit Loans, Inc. Series 2006-QA5
The Trustee designates its offices located at DB Services Tennessee,
addressStreet648 Xxxxxxxxx Xxxx Xxxx, XxxxXxxxxxxxx, XxxxxXX
PostalCode37211-3658, Attn: Transfer Unit, for the purposes of Section
8.12 of the Standard Terms
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Xxxxx’x Investors Service, Inc. addressStreet99 Church Street, 4th Floor
placeCityNew York, StateNew York PostalCode10004
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Standard & Poor’s Ratings Services, a addressStreet55 Water Street
division of The XxXxxx-Xxxx Companies, Inc. 41st Floor
placeCityNew York, StateNew York PostalCode10041
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Any notice required or permitted to be mailed to a Certificateholder shall be given by first Class Mail, postage prepaid, at the
address of such holder as shown in the Certificate Register. Any notice so mailed within the time prescribed in this Agreement shall
be conclusively presumed to have been duly given, whether or not the Certificateholder receives such notice.
Section 11.06. Required Notices to Rating Agency and Subservicer. (See Section 11.06 of the Standard Terms.)
Section 11.07. Severability of Provisions. (See Section 11.07 of the Standard Terms.)
Section 11.08. Supplemental Provisions for Resecuritization. (See Section 11.08 of the Standard Terms.)
Section 11.09. Allocation of Voting Rights.
98.0% of all of the Voting Rights shall be allocated among Holders of the Class A Certificates and Class M Certificates, in
proportion to the outstanding Certificate Principal Balances of their respective Certificates; 1.0% of all Voting Rights shall be
allocated among the Holders of Class I-SB Certificates; 0.25% of all Voting Rights shall be allocated among the Holders of the Class
I-R-I Certificates, in accordance with their respective Percentage Interests; 0.25% of all Voting Rights shall be allocated among the
Holders of the Class I-R-II Certificates, in accordance with their respective Percentage Interests; 0.25% of all Voting Rights shall
be allocated among the Holders of the Class I-R-III Certificates, in accordance with their respective Percentage Interests; and 0.25%
of all Voting Rights shall be allocated among the Holders of the Class II-R-I Certificates, in accordance with their respective
Percentage Interests.
Section 11.10. No Petition.
The Depositor, Master Servicer and the Trustee, by entering into this Agreement, and each Certificateholder, by accepting a
Certificate, hereby covenant and agree that they will not at any time institute against the Trust Fund, or join in any institution
against the Trust Fund of, any bankruptcy proceedings under any United States federal or state bankruptcy or similar law in
connection with any obligation with respect to the Certificates or this Agreement.
ARTICLE XII
COMPLIANCE WITH REGULATION AB
(See Article XII of the Standard Terms)
IN WITNESS WHEREOF, the Company, the Master Servicer and the Trustee have caused their names to be signed hereto by their
respective officers thereunto duly authorized and their respective seals, duly attested, to be hereunto affixed, all as of the day
and year first above written.
RESIDENTIAL ACCREDIT LOANS, INC.
[Seal]
By: /s/ Xxx Xxxxxxxx
Name: Xxx Xxxxxxxx
Title: Vice President
Attest: /s/ Xxxxxxxxxxx Xxxxxxxx
Name: Xxxxxxxxxxx Xxxxxxxx
Title: Vice President
RESIDENTIAL FUNDING CORPORATION
[Seal]
By: /s/ Xxxxxxxxxxx Xxxxxxxx
Name: Xxxxxxxxxxx Xxxxxxxx
Title: Associate
Attest: /s/ Xxx Xxxxxxxx
Name: Xxx Xxxxxxxx
Title: Associate
DEUTSCHE BANK TRUST COMPANY
[Seal] placecountry-regionAMERICAS, as Trustee
By: /s/ Xxxxxxx Xxxxxxxx
Name: Xxxxxxx Xxxxxxxx
Title: Vice President
By: /s/ Xxxxxxx Xxxxxxxxx
Name: Xxxxxxx Xxxxxxxxx
Title: Authorized Signatory
Attest: /s/ Xxx Xxxxxxxx
Name: Xxx Xxxxxxxx
Title: Authorized Signatory
STATE OF MINNESOTA )
) ss.:
COUNTY OF HENNEPIN )
On the 29th day of June, 2006 before me, a notary public in and for said State, personally appeared Xxx Xxxxxxxx Xxxxxxxx
known to me to be a Vice President of Residential Accredit Loans, Inc., one of the corporations that executed the within instrument,
and also known to me to be the person who executed it on behalf of said corporation, and acknowledged to me that such corporation
executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this certificate first
above written.
Notary Public
[Notarial Seal]
STATE OF MINNESOTA )
) ss.:
COUNTY OF HENNEPIN )
On the 29th day of June, 2006 before me, a notary public in and for said State, personally appeared Xxxxxxxxxxx Xxxxxxxx
known to me to be a(n) Associate of Residential Funding Corporation, one of the corporations that executed the within instrument, and
also known to me to be the person who executed it on behalf of said corporation, and acknowledged to me that such corporation
executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this certificate first
above written.
Notary Public
[Notarial Seal]
STATE OF CALIFORNIA )
) ss.:
COUNTY OF ORANGE )
On the 29th day of June, 2006 before me, a notary public in and for said State, personally appeared Xxxxxxx Xxxxxxxx known
to me to be a(n) Vice President of DEUTSCHE BANK TRUST COMPANY AMERICAS, the national banking association that executed the within
instrument, and also known to me to be the person who executed it on behalf of said national banking association and acknowledged to
me that such national banking association executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this certificate first
above written.
Notary Public
[Notarial Seal]
STATE OF CALIFORNIA )
) ss.:
COUNTY OF ORANGE )
On the 29th day of June, 2006 before me, a notary public in and for said State, personally appeared Xxxxxxx Xxxxxxxxx known
to me to be a(n) Associate of DEUTSCHE BANK TRUST COMPANY AMERICAS, the national banking association that executed the within
instrument, and also known to me to be the person who executed it on behalf of said national banking association and acknowledged to
me that such national banking association executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this certificate first
above written.
Notary Public
[Notarial Seal]
EXHIBIT 1
MORTGAGE LOAN SCHEDULE
EXHIBIT 2
INFORMATION TO BE INCLUDED IN
MONTHLY DISTRIBUTION DATE STATEMENT
(i) the applicable Record Date, Determination Date and Distribution Date, and the date on which the applicable interest
accrual period commenced;
(ii) the aggregate amount of payments received with respect to the Mortgage Loans, including prepayment amounts;
(iii) the Servicing Fee and Subservicing Fee payable to the Master Servicer and the Subservicer;
(iv) the amount of any other fees or expenses paid, and the identity of the party receiving such fees or expenses;
(v) (a) the amount of such distribution to the Certificateholders of such Class applied to reduce the Certificate Principal
Balance thereof, and (b) the aggregate amount included therein representing Principal Prepayments;
(vi) the amount of such distribution to Holders of such Class of Certificates allocable to interest;
(vii) if the distribution to the Holders of such Class of Certificates is less than the full amount that would be
distributable to such Holders if there were sufficient funds available therefor, the amount of the shortfall;
(viii) the aggregate Certificate Principal Balance of each Class of Certificates, before and after giving effect to the
amounts distributed on such Distribution Date, separately identifying any reduction thereof due to Realized Losses other
than pursuant to an actual distribution of principal;
(ix) the aggregate Certificate Principal Balance of each of the Class I-A, Class I-M and Class I-SB Certificates as of the
Closing Date.
(x) the weighted average remaining term to maturity of the Mortgage Loans after giving effect to the amounts distributed on
such Distribution Date;
(xi) the weighted average Mortgage Rates of the Mortgage Loans after giving effect to the amounts distributed on such
Distribution Date;
(xii) the number and Pool Stated Principal Balance of the Mortgage Loans after giving effect to the distribution of
principal on such Distribution Date and the number of Mortgage Loans at the beginning and end of the related Due Period;
(xiii) on the basis of the most recent reports furnished to it by Sub-Servicers, the number and Stated Principal Balances of
Mortgage Loans that are Delinquent (A) 30-59 days, (B) 60-89 days and (C) 90 or more days and the number and Stated
Principal Balances of Mortgage Loans that are in foreclosure;
(xiv) the aggregate amount of Realized Losses for such Distribution Date;
(xv) the amount, terms and general purpose of any Advance by the Master Servicer pursuant to Section 4.04 and the amount of
all Advances that have been reimbursed during the related Due Period;
(xvi) any material modifications, extensions or waivers to the terms of the Mortgage Loans during the Due Period or that
have cumulatively become material over time;
(xvii) any material breaches of Mortgage Loan representations or warranties or covenants in the Agreement.
(xviii) the number, stated and aggregate principal balance of any REO Properties;
(xix) the aggregate Accrued Certificate Interest remaining unpaid, if any, for each Class of Certificates, after giving
effect to the distribution made on such Distribution Date;
(xx) the Pass-Through Rates on each Class of Certificates and the Net WAC Cap Rate for such Distribution Date, separately
identifying LIBOR for such Distribution Date;
(xxi) the Basis Risk Shortfall and Prepayment Interest Shortfalls;
(xxii) the related Senior Enhancement Percentage for such Distribution Date;
(xxiii) the Overcollateralization Amount and Required Overcollateralization Amount following such Distribution Date;
(xxiv) the occurrence of the Stepdown Date, and the aggregate amount of Realized Losses since the Cut-off Date for the
Mortgage Loans;
(xxv) the occurrence of the Credit Support Depletion Date;
(xxvi) the aggregate amount of any recoveries on previously foreclosed loans from Sellers; and
(xxvii) the amount of any Net Swap Payment payable to the Trustee on behalf of the Trust, any Net Swap Payment payable to
the Swap Counterparty, any Swap Termination Payment payable to the Trustee on behalf of the Trust and any Swap Termination
Payment payable to the Swap Counterparty.
In the case of information furnished pursuant to clauses (v)(a) and (vi) above, the amounts shall be expressed as a dollar
amount per Certificate with a $1,000 denomination.
The Trustee's internet website will initially be located at xxx.xxx.xx.xxx/xxxx. To receive this statement via first class
mail, telephone the trustee at (000) 000-0000.
EXHIBIT 3
STANDARD TERMS OF POOLING AND SERVICING
AGREEMENT DATED AS OF MARCH 1, 2006
EXHIBIT 4:
SWAP AGREEMENT
EXHIBIT 5:
SB-AM SWAP AGREEMENT
EXHIBIT 6
FORM OF RULE CLASS I-SB-[_] CERTIFICATE
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS I-A AND CLASS I-M CERTIFICATES AS DESCRIBED IN THE
AGREEMENT (AS DEFINED HEREIN).
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “REGULAR INTEREST” IN A “REAL ESTATE MORTGAGE INVESTMENT
CONDUIT,” AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986. COUPLED WITH THE
RIGHT TO RECEIVE PAYMENTS UNDER THE YIELD MAINTENANCE AGREEMENT.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES
LAWS OF ANY STATE AND MAY NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO SUCH ACT AND LAWS OR IS SOLD OR
TRANSFERRED IN TRANSACTIONS WHICH ARE EXEMPT FROM REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE LAW AND IS TRANSFERRED IN
ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND SERVICING AGREEMENT (THE “AGREEMENT”).
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN SHALL BE MADE TO ANY PLAN SUBJECT TO TITLE I OF ERISA OR SECTION 4975
OF THE CODE, ANY PERSON ACTING, DIRECTLY OR INDIRECTLY, ON BEHALF OF ANY SUCH PLAN OR ANY PERSON ACQUIRING SUCH CERTIFICATES WITH
“PLAN ASSETS” OF A PLAN WITHIN THE MEANING OF THE DEPARTMENT OF LABOR REGULATION PROMULGATED AT 29 C.F.R. §2510.3-101( “PLAN ASSET
REGULATIONS”) UNLESS THE DEPOSITOR, THE TRUSTEE AND THE MASTER SERVICER ARE PROVIDED WITH AN OPINION OF COUNSEL WHICH ESTABLISHES TO
THE SATISFACTION OF THE DEPOSITOR, THE TRUSTEE AND THE MASTER SERVICER THAT THE PURCHASE OF THIS CERTIFICATE IS PERMISSIBLE UNDER
APPLICABLE LAW, WILL NOT CONSTITUTE OR RESULT IN ANY PROHIBITED TRANSACTION UNDER ERISA OR SECTION 4975 OF THE CODE AND WILL NOT
SUBJECT THE DEPOSITOR, THE MASTER SERVICER, THE TRUSTEE OR THE TRUST FUND TO ANY OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR
LIABILITIES UNDER ERISA OR SECTION 4975 OF THE CODE) IN ADDITION TO THOSE UNDERTAKEN IN THE AGREEMENT, WHICH OPINION OF COUNSEL SHALL
NOT BE AN EXPENSE OF. THE DEPOSITOR, THE MASTER SERVICER, THE TRUSTEE OR THE TRUST FUND.
CUSIP: _____________________ Certificate No. SB-[__]-1
Date of Pooling and Servicing Agreement Percentage Interest: 100.00%
and Cut-off Date: ___________
First Distribution Date: _________ Aggregate Initial Notional Balance
of the Class I-SB-[_] Certificates:
$___________________________
Master Servicer: Initial Notional Balance
Residential Funding Corporation of this Class I-SB-[_] Certificate:
$___________________________
Maturity Date:
__________ __, 20__
MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATES
SERIES 2006-QA5
evidencing a percentage interest in the distributions allocable to the Class I-SB-[_] Certificates
with respect to a Trust Fund consisting primarily of a pool of fixed and adjustable interest rate,
first lien mortgage loans on one- to four-family residential properties sold by RESIDENTIAL
ACCREDIT LOANS INCORPORATED
This Certificate is payable solely from the assets of the Trust Fund, and does not represent an obligation of or interest in
RESIDENTIAL ACCREDIT LOANS INCORPORATED, the Master Servicer, the Trustee referred to below or any of their affiliates. Neither this
Certificate nor the underlying Mortgage Loans are guaranteed or insured by any governmental agency or instrumentality or by
RESIDENTIAL ACCREDIT LOANS INCORPORATED, the Master Servicer, the Trustee or any of their affiliates. None of the Depositor, the
Master Servicer or any of their affiliates will have any obligation with respect to any certificate or other obligation secured by or
payable from payments on the Certificates.
This certifies that ___________. is the registered owner of the Percentage Interest evidenced by this Certificate in certain
distributions with respect to the Trust Fund consisting primarily of an interest in a pool of adjustable interest rate, first lien
mortgage loans on one- to four-family residential properties, sold by RESIDENTIAL ACCREDIT LOANS INCORPORATED (hereinafter called the
“Depositor,” which term includes any successor entity under the Agreement referred to below). The Trust Fund was created pursuant to
a Pooling and Servicing Agreement dated as specified above (the “Agreement”) among the Depositor, the Master Servicer and Deutsche
Bank Trust Company Americas, as trustee (the “Trustee”), a summary of certain of the pertinent provisions of which is set forth
hereafter. To the extent not defined herein, the capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof, assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be made on the 25th day of each month or, if such 25th day is
not a Business Day, the Business Day immediately following (the “Distribution Date”), commencing as described in the Agreement, to
the Person in whose name this Certificate is registered at the close of business on the last Business Day of the month immediately
preceding the month of such distribution (the “Record Date”), from the Available Distribution Amount in an amount equal to the
product of the Percentage Interest evidenced by this Certificate and the amount of interest and principal, if any, required to be
distributed to Holders of Class I-SB-[_] Certificates on such Distribution Date.
Distributions on this Certificate will be made either by the Master Servicer acting on behalf of the Trustee or by a Paying
Agent appointed by the Trustee in immediately available funds (by wire transfer or otherwise) for the account of the Person entitled
thereto if such Person shall have so notified the Master Servicer or such Paying Agent, or by check mailed to the address of the
Person entitled thereto, as such name and address shall appear on the Certificate Register.
Notwithstanding the above, the final distribution on this Certificate will be made after due notice of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the office or agency appointed by the Trustee for that
purpose in placeCitySt. Xxxx, StateMinnesota. The Notional Amount of this Class I-SB-[_] Certificate as of any date of determination
will be calculated as described in the Agreement. This Class I-SB-[_] Certificate will accrue interest at the Pass-Through Rate on
the Notional Amount as indicated in the definition of Accrued Certificate Interest in the Agreement. This Class I-SB-[_] Certificate
will not accrue interest on its Certificate Principal Balance.
Any Transferee of this Certificate will be deemed to have represented by virtue of its purchase or holding of this
Certificate (or interest therein) that either such transferee is not an employee benefit plan or other plan or arrangement subject to
the prohibited transaction provisions of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), or Section 4975
of the Code or a person (including an insurance company investing its general account, an investment manager, a named fiduciary or a
trustee of any such plan) who is using “plan assets” of any such plan to effect such acquisition.
This Certificate is one of a duly authorized issue of Certificates issued in several Classes designated as Mortgage
Asset-Backed Pass-Through Certificates of the Series specified hereon (herein collectively called the “Certificates”).
The Certificates are limited in right of payment to certain collections and recoveries respecting the Mortgage Loans, all as
more specifically set forth herein and in the Agreement. In the event Master Servicer funds are advanced with respect to any
Mortgage Loan, such advance is reimbursable to the Master Servicer, to the extent provided in the Agreement, from related recoveries
on such Mortgage Loan or from other cash that would have been distributable to Certificateholders.
As provided in the Agreement, withdrawals from the Custodial Account and/or the Certificate Account created for the benefit
of Certificateholders may be made by the Master Servicer from time to time for purposes other than distributions to
Certificateholders, such purposes including without limitation reimbursement to the Depositor and the Master Servicer of advances
made, or certain expenses incurred, by either of them.
The Agreement permits, with certain exceptions therein provided, the amendment of the Agreement and the modification of the
rights and obligations of the Depositor, the Master Servicer and the Trustee and the rights of the Certificateholders under the
Agreement from time to time by the Depositor, the Master Servicer and the Trustee with the consent of the Holders of Certificates
evidencing in the aggregate not less than 66% of the Percentage Interests of each Class of Certificates affected thereby. Any such
consent by the Holder of this Certificate shall be conclusive and binding on such Holder and upon all future holders of this
Certificate and of any Certificate issued upon the transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon the Certificate. The Agreement also permits the amendment thereof in certain circumstances without the
consent of the Holders of any of the Certificates and, in certain additional circumstances, without the consent of the Holders of
certain Classes of Certificates.
As provided in the Agreement and subject to certain limitations therein set forth, the transfer of this Certificate is
registrable in the Certificate Register upon surrender of this Certificate for registration of transfer at the offices or agencies
appointed by the Trustee in St. Xxxx, Minnesota, duly endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate Registrar duly executed by the Holder hereof or such
Xxxxxx’s attorney duly authorized in writing, and thereupon one or more new Certificates of authorized denominations evidencing the
same Class and aggregate Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable only as registered Certificates without coupons in Classes and in denominations specified in
the Agreement. As provided in the Agreement and subject to certain limitations therein set forth, Certificates are exchangeable for
new Certificates of authorized denominations evidencing the same Class and aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No service charge will be made for any such registration of transfer or exchange, but the Trustee may require payment of a
sum sufficient to cover any tax or other governmental charge payable in connection therewith.
The Depositor, the Master Servicer, the Trustee, the Certificate Registrar and any agent of the Depositor, the Master
Servicer, the Trustee or the Certificate Registrar may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Master Servicer, the Trustee or any such agent shall be affected by notice to
the contrary.
This Certificate shall be governed by and construed in accordance with the laws of the State of placeStateNew York.
The obligations created by the Agreement in respect of the Certificates and the Trust Fund created thereby shall terminate
upon the payment to Certificateholders of all amounts held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the maturity or other liquidation of the last Mortgage Loan subject thereto or the
disposition of all property acquired upon foreclosure or deed in lieu of foreclosure of any Mortgage Loan, and (ii) the purchase by
the Holder of the Class I-SB Certificates or the Master Servicer, as described in the Agreement, from the Trust Fund of all remaining
Mortgage Loans and all property acquired in respect of such Mortgage Loans or the Certificates, in either case thereby effecting
early retirement of the Certificates. The Agreement permits, but does not require, the Holder of the Class I-SB Certificates or the
Master Servicer, as described in the Agreement, (i) to purchase, at a price determined as provided in the Agreement, all remaining
Mortgage Loans and all property acquired in respect of any Mortgage Loan or (ii) to purchase in whole, but not in part, all of the
Certificates from the Holders thereof, provided, that any such option may only be exercised if the Stated Principal Balance before
giving effect to the distributions to be made on such Distribution Date of the Mortgage Loans, as of the Distribution Date upon which
the proceeds of any such purchase are distributed is less than ten percent of the Cut-off Date Balance.
Unless the certificate of authentication hereon has been executed by the Certificate Registrar by manual signature, this
Certificate shall not be entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly executed.
DEUTSCHE BANK TRUST COMPANY placecountry-regionAMERICAS,
as Trustee
By: _________________________________________________
Authorized Signatory
Dated:_____________________
Certificate of Authentication
This is one of the Class I-SB-[_] Certificates referred to in the within-mentioned Agreement.
DEUTSCHE BANK TRUST COMPANY placecountry-regionAMERICAS,
as Certificate Registrar
By: _______________________________
Authorized Signatory
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
(Please print or typewrite name and address including postal zip code of assignee) the beneficial interest evidenced by the within
Trust Certificate and hereby authorizes the transfer of registration of such interest to assignee on the Certificate Register of the
Trust Fund.
I (We) further direct the Certificate Registrar to issue a new Certificate of a like denomination and Class, to the above
named assignee and deliver such Certificate to the following address:
___________________________________________________________________________________________________________________
Dated:_____________________ ____________________________________
Signature by or on behalf of assignor
___________________________________________________________________________________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately available fund
to____________________________________________________________________________
for the account of ________________________________________________________________________________________________
account number ____________________________________________________________________________________________________
or, if mailed by check, to ________________________________________________________________________________________
Applicable statements should be mailed to:________________________________________________________________
___________________________________________________________________________________________________________________
___________________________________________________________________________________________________________________
This information is provided by ___________________________________, the assignee named above, or
______________________________, as its agent.
EXHIBIT 7:
FORM OF CLASS P CERTIFICATE
Certificate No. _ Prepayment Charge
Class P - Prepayment Charge Aggregate Certificate Principal Balance
of the Class P
Date of Pooling and Servicing Certificates as of
Agreement and Cut-off Date: the Cut-off Date:
_________ $0.00
First Distribution Date: Initial Certificate Principal Balance of this
_________ Certificate: $0.00
Master Servicer: Percentage Interest of this Certificate:
Residential Funding Corporation 100%
Assumed Final Distribution Date: CUSIP: _________
_________
MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATE,
SERIES 2006-QA5
evidencing a percentage interest in any distributions allocable to the Class I-P Certificates with respect to the
Trust Fund consisting primarily of a pool of one- to four-family residential, payment-option, adjustable-rate first
lien mortgage loans with a negative amortization feature formed and sold by RESIDENTIAL ACCREDIT LOANS, INC.
This Certificate is payable solely from the assets of the Trust Fund, and does not represent an obligation of or
interest in Residential Accredit Loans, Inc., the Master Servicer, the Trustee referred to below or GMAC Mortgage Group, Inc. or any
of their affiliates. Neither this Certificate nor the underlying Mortgage Loans are guaranteed or insured by any governmental agency
or instrumentality or by Residential Accredit Loans, Inc., the Master Servicer, the Trustee or GMAC Mortgage Group, Inc. or any of
their affiliates. None of the Company, the Master Servicer, GMAC Mortgage Group, Inc. or any of their affiliates will have any
obligation with respect to any certificate or other obligation secured by or payable from payments on the Certificates.
This certifies that _________________________ is the registered owner of the Percentage Interest evidenced by this
Certificate (as specified above) in certain distributions with respect to a Trust Fund consisting primarily of a pool of one- to
four-family residential, payment-option, adjustable-rate first lien mortgage loans with a negative amortization feature (the
“Mortgage Loans”), formed and sold by Residential Accredit Loans, Inc. (hereinafter called the “Company,” which term includes any
successor entity under the Agreement referred to below). The Trust Fund was created pursuant to a Pooling and Servicing Agreement
dated as specified above (the “Agreement”) among the Company, the Master Servicer and Deutsche Bank Trust Company Americas, as
trustee (the “Trustee”), a summary of certain of the pertinent provisions of which is set forth hereafter. To the extent not defined
herein, the capitalized terms used herein have the meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be made on the 25th day of each month or, if such 25th
day is not a Business Day, the Business Day immediately following (the “Distribution Date”), commencing on the first Distribution
Date specified above, to the Person in whose name this Certificate at the close of business on the last day (or if such last day is
not a Business Day, the Business Day immediately preceding such last day) of the month immediately preceding the month of such
distribution (the "Record Date"), in an amount equal to the product of the Percentage Interest evidenced by this Certificate and the
amount required to be distributed to Holders of Class I-P Certificates on such Distribution Date.
Distributions on this Certificate will be made either by the Master Servicer acting on behalf of the Trustee or by a
Paying Agent appointed by the Trustee in immediately available funds (by wire transfer or otherwise) for the account of the Person
entitled thereto if such Person shall have so notified the Master Servicer or such Paying Agent, or by check mailed to the address of
the Person entitled thereto, as such name and address shall appear on the Certificate Register.
Notwithstanding the above, the final distribution on this Certificate will be made after due notice of the pendency
of such distribution and only upon presentation and surrender of this Certificate at the office or agency appointed by the Trustee
for that purpose in the City and State of placeStateNew York.
No transfer of this Class I-P Certificate will be made unless such transfer is exempt from the registration
requirements of the Securities Act of 1933, as amended, and any applicable state securities laws or is made in accordance with said
Act and laws. In the event that such a transfer is to be made, (i) the Trustee or the Company may require an opinion of counsel
acceptable to and in form and substance satisfactory to the Trustee and the Company that such transfer is exempt (describing the
applicable exemption and the basis therefor) from or is being made pursuant to the registration requirements of the Securities Act of
1933, as amended, and of any applicable statute of any state and (ii) the transferee shall execute an investment letter in the form
described by Section 5.02(e) of the Agreement. The Holder hereof desiring to effect such transfer shall, and does hereby agree to,
indemnify the Trustee, the Company, the Master Servicer and the Certificate Registrar acting on behalf of the Trustee against any
liability that may result if the transfer is not so exempt or is not made in accordance with such Federal and state laws. In
connection with any such transfer, the Trustee will also require either (i) an opinion of counsel acceptable to and in form and
substance satisfactory to the Trustee, the Company and the Master Servicer with respect to the permissibility of such transfer under
the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and Section 4975 of the Internal Revenue Code (the “Code”)
and stating, among other things, that the transferee’s acquisition of a Class I-P Certificate will not constitute or result in a
non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code or (ii) a representation letter, in the form
as described by Section 5.02(e) of the Agreement, either stating that the transferee is not an employee benefit or other plan subject
to the prohibited transaction provisions of ERISA or Section 4975 of the Code (a “Plan”), or any other person (including an
investment manager, a named fiduciary or a trustee of any Plan) acting, directly or indirectly, on behalf of or purchasing any
Certificate with “plan assets” of any Plan, or stating that the transferee is an insurance company, the source of funds to be used by
it to purchase the Certificate is an “insurance company general account” (within the meaning of Department of Labor Prohibited
Transaction Class Exemption (“PTCE”) 95-60), and the purchase is being made in reliance upon the availability of the exemptive relief
afforded under Sections I and III of PTCE 95-60.
This Certificate is one of a duly authorized issue of Certificates issued in several Classes designated as Mortgage
Asset-Backed Pass-Through Certificates of the Series specified hereon (herein collectively called the “Certificates”).
The Certificates are limited in right of payment to certain collections and recoveries respecting the Mortgage
Loans, all as more specifically set forth herein and in the Agreement. In the event Master Servicer funds are advanced with respect
to any Mortgage Loan, such advance is reimbursable to the Master Servicer, to the extent provided in the Agreement, from related
recoveries on such Mortgage Loan or from other cash that would have been distributable to Certificateholders.
As provided in the Agreement, withdrawals from the Custodial Account and/or the Certificate Account created for the
benefit of Certificateholders may be made by the Master Servicer from time to time for purposes other than distributions to
Certificateholders, such purposes including without limitation reimbursement to the Company and the Master Servicer of advances made,
or certain expenses incurred, by either of them.
The Agreement permits, with certain exceptions therein provided, the amendment of the Agreement and the modification
of the rights and obligations of the Company, the Master Servicer and the Trustee and the rights of the Certificateholders under the
Agreement at any time by the Company, the Master Servicer and the Trustee with the consent of the Holders of Certificates evidencing
in the aggregate not less than 66% of the Percentage Interests of each Class of Certificates affected thereby. Any such consent by
the Holder of this Certificate shall be conclusive and binding on such Holder and upon all future holders of this Certificate and of
any Certificate issued upon the transfer hereof or in exchange herefor or in lieu hereof whether or not notation of such consent is
made upon the Certificate. The Agreement also permits the amendment thereof in certain circumstances without the consent of the
Holders of any of the Certificates and, in certain additional circumstances, without the consent of the Holders of certain Classes of
Certificates.
As provided in the Agreement and subject to certain limitations therein set forth, the transfer of this Certificate
is registrable in the Certificate Register upon surrender of this Certificate for registration of transfer at the offices or agencies
appointed by the Trustee in the City and State of New York, duly endorsed by, or accompanied by an assignment in the form below or
other written instrument of transfer in form satisfactory to the Trustee and the Certificate Registrar duly executed by the Holder
hereof or such Holder’s attorney duly authorized in writing, and thereupon one or more new Certificates of authorized denominations
evidencing the same Class and aggregate Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable only as registered Certificates without coupons in Classes and in denominations
specified in the Agreement. As provided in the Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of authorized denominations evidencing the same Class and aggregate Percentage Interest, as
requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer or exchange, but the Trustee may require
payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith.
The Company, the Master Servicer, the Trustee and the Certificate Registrar and any agent of the Company, the Master
Servicer, the Trustee or the Certificate Registrar may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and neither the Company, the Master Servicer, the Trustee nor any such agent shall be affected by notice to
the contrary.
This Certificate shall be governed by and construed in accordance with the laws of the State of placeStateNew York.
The obligations created by the Agreement in respect of the Certificates and the Trust Fund created thereby shall
terminate upon the payment to Certificateholders of all amounts held by or on behalf of the Trustee and required to be paid to them
pursuant to the Agreement following the earlier of (i) the maturity or other liquidation of the last Mortgage Loan subject thereto or
the disposition of all property acquired upon foreclosure or deed in lieu of foreclosure of any Mortgage Loan and (ii) the purchase
by the Master Servicer from the Trust Fund of all remaining Mortgage Loans and all property acquired in respect of such Mortgage
Loans, thereby effecting early retirement of the Certificates. The Agreement permits, but does not require, the Master Servicer to
(i) purchase at a price determined as provided in the Agreement all remaining Mortgage Loans and all property acquired in respect of
any Mortgage Loan or (ii) purchase in whole, but not in part, all of the Certificates from the Holders thereof; provided, that any
such option may only be exercised if the Pool Stated Principal Balance of the Mortgage Loans as of the Distribution Date upon which
the proceeds of any such purchase are distributed is less than ten percent of the Cut-off Date Principal Balance of the Mortgage
Loans.
Unless the certificate of authentication hereon has been executed by the Certificate Registrar, by manual signature,
this Certificate shall not be entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly executed.
Dated: June 29, 2006 DEUTSCHE BANK TRUST COMPANY placecountry-regionAMERICAS,
as Trustee
By:____________________________
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class I-P Certificates referred to in the within-mentioned Agreement.
DEUTSCHE BANK TRUST COMPANY placecountry-regionAMERICAS,
as Certificate Registrar
By:______________________________
Authorized Signatory
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
(Please print or typewrite name and address including
postal zip code of assignee) a Percentage Interest evidenced by the within Mortgage Asset-Backed Pass-Through Certificate and hereby
authorizes the transfer of registration of such interest to assignee on the Certificate Register of the Trust Fund.
I (We) further direct the Certificate Registrar to issue a new Certificate of a like denomination and Class, to the
above named assignee and deliver such Certificate to the following address:
Dated:
Signature by or on behalf of assignor
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately available funds to
_________________________________________________________________ for the account of
_______________________ account number __________________________ , or, if mailed by check, to
________________________________________________ Applicable statements should be mailed to
__________________________________________________.
This information is provided by ___________________________________, the assignee named above, or
_______________________________, as its agent.
EXHIBIT 8:
FORM OF ERISA REPRESENTATION LETTER
__________, 20__
Residential Accredit Loans, Inc.
0000 Xxxxxxxxxx Xxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxx 00000
Deutsche Bank Trust Companies placecountry-regionAmericas
DB Services placeStateTennessee
t648 Grassmere Xxxx Xxxx
Xxxxxxxxx, XX 00000-3658
Attn: Transfer Unit
Residential Funding Corporation
0000 Xxxxxxxxxx Xxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Residential Asset Securities Corporation Series 2006- QA5
Re: Mortgage Asset-Backed Pass-Through Certificates,
Series 2006-QA5 Class [ ]
Ladies and Gentlemen:
[____________________________________] (the “Purchaser”) intends to purchase from [______________________________] (the
“Seller”) $[____________] Initial Certificate Principal Balance of Mortgage Asset-Backed Pass-Through Certificates, Series 2006-QA5,
Class ____ (the “Certificates”), issued pursuant to the Series Supplement, dated as of July 1, 2006, and the Standard Terms of
Pooling and Servicing Agreement, dated as of March 1, 2006 (the “Pooling and Servicing Agreement”), among Residential Accredit Loans,
Inc., as the depositor (the “Depositor”), Residential Funding Corporation, as master servicer (the “Master Servicer”) and Deutsche
Bank Trust Companies Americas, as trustee (the “Trustee”). All terms used herein and not otherwise defined shall have the meanings
set forth in the Pooling and Servicing Agreement. The Purchaser hereby certifies, represents and warrants to, and covenants with, the
Depositor, the Trustee and the Master Servicer that The Purchaser is not an employee benefit plan or other plan or arrangement
subject to the prohibited transaction provisions of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), or
Section 4975 of the Internal Revenue Code of 1986, as amended (the “Code”), or any person (including an insurance company investing
its general account, an investment manager, a named fiduciary or a trustee of any such plan) who is using “plan assets” of any such
plan to effect such acquisition.
Very truly yours,
_______________________________________
(Purchaser)
By: ____________________________________
Name: __________________________________
Title: ___________________________________
