Execution Copy
RESIDENTIAL ACCREDIT LOANS, INC.,
Company,
RESIDENTIAL FUNDING COMPANY, LLC,
Master Servicer,
and
DEUTSCHE BANK TRUST COMPANY AMERICAS,
Trustee
SERIES SUPPLEMENT,
Dated as of October 30, 2006,
TO
STANDARD TERMS OF
POOLING AND SERVICING AGREEMENT
dated as of October 30, 2006
Mortgage Asset-Backed Pass-Through Certificates
Series 2006-QA9
TABLE OF CONTENTS
ARTICLE I DEFINITIONS........................................................8
Section 1.01. Definitions.............................................8
Section 1.02. Determination of LIBOR.................................42
Section 1.03. Use of Words and Phrases...............................43
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; ORIGINAL ISSUANCE OF
CERTIFICATES.................................................44
Section 2.01. Conveyance of Mortgage Loans...........................44
Section 2.02. Acceptance by Trustee..................................44
Section 2.03. Representations, Warranties and Covenants of the
Master Servicer and the Company........................44
Section 2.04. Representations and Warranties of Sellers..............47
Section 2.05. Execution and Authentication of
Certificates/Issuance of Certificates Evidencing
Interests in REMICs....................................47
Section 2.06. Conveyance of Uncertificated REMIC Regular
Interests; Acceptance by the Trustee...................48
Section 2.07. Issuance of Certificates Evidencing Interest in
REMIC III and REMIC IV.................................48
Section 2.08. Purposes and Powers of the Trust.......................48
Section 2.09. Agreement Regarding Ability to Disclose................48
ARTICLE III ADMINISTRATION AND SERVICING OF MORTGAGE LOANS..................49
Section 3.01. Master Servicer to Act as Servicer.....................49
Section 3.02. Subservicing Agreements Between Master Servicer
and Subservicers; Enforcement of Subservicers' and
Sellers' Obligations...................................49
Section 3.03. Successor Subservicers.................................49
Section 3.04. Liability of the Master Servicer.......................49
Section 3.05. No Contractual Relationship Between Subservicer
and Trustee or Certificateholders......................49
Section 3.06. Assumption or Termination of Subservicing
Agreements by Trustee..................................49
Section 3.07. Collection of Certain Mortgage Loan Payments;
Deposit to Custodial Account...........................49
Section 3.08. Subservicing Accounts; Servicing Accounts..............49
Section 3.09. Access to Certain Documentation and Information
Regarding the Mortgage Loans...........................49
Section 3.10. Permitted Withdrawals from the Custodial Account.......49
Section 3.11. Maintenance of the Primary Insurance Policies;
Collections Thereunder.................................49
Section 3.12. Maintenance of Fire Insurance and Omissions and
Fidelity Coverage......................................49
Section 3.13. Enforcement of Due-on-Sale Clauses; Assumption
and Modification Agreements; Certain Assignments......50
Section 3.14. Realization Upon Defaulted Mortgage Loans..............50
Section 3.15. Trustee to Cooperate; Release of Custodial Files.......50
Section 3.16. Servicing and Other Compensation; Compensating
Interest...............................................50
Section 3.17. Reports to the Trustee and the Company.................50
Section 3.18. Annual Statement as to Compliance......................50
Section 3.19. Annual Independent Public Accountants' Servicing
Report.................................................50
Section 3.20. Rights of the Company in Respect of the Master
Servicer...............................................50
Section 3.21. Administration of Buydown Funds........................50
Section 3.22. Advance Facility.......................................50
ARTICLE IV PAYMENTS TO CERTIFICATEHOLDERS...................................51
Section 4.01. Certificate Account....................................51
Section 4.02. Distributions..........................................51
Section 4.03. Statements to Certificateholders; Statements to
the Rating Agencies; Exchange Act Reporting............56
Section 4.04. Distribution of Reports to the Trustee and the
Company; Advances by the Master Servicer...............56
Section 4.05. Allocation of Realized Losses..........................56
Section 4.06. Reports of Foreclosures and Abandonment of
Mortgaged Property.....................................58
Section 4.07. Optional Purchase of Defaulted Mortgage Loans..........58
Section 4.08. Surety Bond............................................58
Section 4.09. Swap Agreement.........................................58
Section 4.10. Yield Maintenance Agreement; Yield Maintenance
Reserve Fund...........................................60
ARTICLE V THE CERTIFICATES..................................................62
Section 5.01. The Certificates.......................................62
Section 5.02. Registration of Transfer and Exchange of
Certificates...........................................62
Section 5.03. Mutilated, Destroyed, Lost or Stolen Certificates......65
Section 5.04. Persons Deemed Owners..................................65
Section 5.05. Appointment of Paying Agent............................65
Section 5.06. U.S.A. Patriot Act Compliance..........................65
ARTICLE VI THE COMPANY AND THE MASTER SERVICER..............................66
Section 6.01. Respective Liabilities of the Company and Master
Servicer.....................Error! Bookmark not defined.
Section 6.02. Merger or Consolidation of the Company or Master
Servicer; Assignment of Rights and Delegation of
Duties by the Master Servicer.Error! Bookmark not defined.
Section 6.03. Limitation on Liability of the Company, Master
Servicer and Others..........Error! Bookmark not defined.
Section 6.04. Company and Master Servicer Not to Resign.Error!
Bookmark not defined.
ARTICLE VII DEFAULT.........................................................66
ARTICLE VIII CONCERNING THE TRUSTEE AND SUPPLEMENTAL INTEREST TRUST
TRUSTEE......................................................66
Section 8.01. Duties of the Trustee and Supplemental Interest
Trust Trustee..........................................66
Section 8.02. Certain Matters Affecting the Trustee and
Supplemental Interest Trust Trustee....................68
Section 8.03. Trustee and Supplemental Interest Trust Trustee
Not Liable for Certificates or Mortgage Loans..........68
Section 8.04. Trustee and Supplemental Interest Trust Trustee
May Own Certificates...................................68
Section 8.05. Master Servicer to Pay Trustee's and Supplemental
Interest Trust Trustee's Fees and Expenses;
Indemnification........................................68
Section 8.06. Eligibility Requirements for Trustee...................68
Section 8.07. Resignation and Removal of the Trustee and
Supplemental Interest Trust Trustee....................68
Section 8.08. Successor Trustee and Successor Supplemental
Interest Trust Trustee.................................68
Section 8.09. Merger or Consolidation of Trustee.....................68
Section 8.10. Appointment of Co-Trustee or Separate Trustee.
(See Section 8.10 of the Standard Terms)...............68
Section 8.11. Appointment of Custodians..............................68
Section 8.12. Appointment of Office or Agency. (See Section
8.12 of the Standard Terms)............................68
Section 8.13. Swap Agreement.........................................68
Section 8.14. Yield Maintenance Agreement............................68
ARTICLE IX TERMINATION......................................................68
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..................................................68
ARTICLE X REMIC PROVISIONS..................................................68
Section 10.01. REMIC Administration...................................68
Section 10.02. Master Servicer; REMIC Administrator and Trustee
Indemnification........................................68
Section 10.03. Designation of REMICs..................................68
Section 10.04. Distributions on the Uncertificated REMIC Regular
Interests..............................................68
Section 10.05. Compliance with Withholding Requirements...............68
ARTICLE XI MISCELLANEOUS PROVISIONS.........................................68
Section 11.01. Amendment..............................................68
Section 11.02. Recordation of Agreement; Counterparts.................68
Section 11.03. Limitation on Rights of Certificateholders.............68
Section 11.04. Governing Law..........................................68
Section 11.05. Notices................................................68
Section 11.06. Required Notices to Rating Agency and Subservicer......68
Section 11.07. Severability of Provisions.............................68
Section 11.08. Supplemental Provisions for Resecuritization...........68
Section 11.09. Allocation of Voting Rights............................68
Section 11.10. No Petition............................................68
ARTICLE XII COMPLIANCE WITH REGULATION AB..................................68
EXHIBITS
Exhibit One: Mortgage Loan Schedule
Exhibit Two: Information to be Included in Monthly Distribution
Date Statement
Exhibit Three: Standard Terms of Pooling and Servicing Agreement,
dated as of October 30, 2006
Exhibit Four: Swap Agreement
Exhibit Five: SB-AM Swap Agreement
Exhibit Six Yield Maintenance Agreement
This is a Series Supplement, dated as of October 30, 2006 (the "Series
Supplement"), to the Standard Terms of Pooling and Servicing Agreement, dated
as of October 30, 2006 and attached as Exhibit Four 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 COMPANY, LLC, as master servicer (together with its
permitted successors and assigns, the "Master Servicer"), and DEUTSCHE BANK
TRUST COMPANY AMERICAS, as Trustee and supplemental interest trust trustee
(together with its permitted successors and assigns, the "Trustee" and the
"Supplemental Interest Trust Trustee"), respectively.
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 and
certain other related assets (exclusive of the Supplemental Interest Trust
Account, the Swap Agreement, the Yield Maintenance Agreement, the Yield
Maintenance Reserve Fund and the SB-AM Swap Agreement) subject to this
Agreement as a real estate mortgage investment conduit (a "REMIC") for
federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC I." Component I of the Class R-1 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.
Component I of the Class R-1 Certificates will not bear interest or have a
Certificate Principal Balance. 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
Pass-Through REMIC I
Designation Rate Principal Balance
I-1-A Variable(1) $4,662,780.50
I-2-A Variable(1) $4,602,074.00
I-3-A Variable(1) $4,540,633.50
I-4-A Variable(1) $4,477,855.00
I-5-A Variable(1) $4,413,539.50
I-6-A Variable(1) $4,348,000.50
I-7-A Variable(1) $4,281,942.50
I-8-A Variable(1) $4,214,959.00
I-9-A Variable(1) $4,146,664.50
I-10-A Variable(1) $4,077,436.50
I-11-A Variable(1) $4,007,896.50
I-12-A Variable(1) $3,937,706.00
I-13-A Variable(1) $3,884,191.00
I-14-A Variable(1) $3,819,367.50
I-15-A Variable(1) $3,754,262.00
I-16-A Variable(1) $3,688,571.00
I-17-A Variable(1) $3,622,105.50
I-18-A Variable(1) $3,555,005.00
I-19-A Variable(1) $3,487,856.00
I-20-A Variable(1) $3,420,134.50
I-21-A Variable(1) $3,352,085.50
I-22-A Variable(1) $3,284,184.00
I-23-A Variable(1) $3,216,067.50
I-24-A Variable(1) $3,146,343.50
I-25-A Variable(1) $3,073,734.50
I-26-A Variable(1) $3,000,620.00
I-27-A Variable(1) $2,927,939.50
I-28-A Variable(1) $2,855,518.50
I-29-A Variable(1) $2,783,857.50
I-30-A Variable(1) $2,713,634.50
I-31-A Variable(1) $2,643,924.50
I-32-A Variable(1) $2,574,608.00
I-33-A Variable(1) $2,505,515.50
I-34-A Variable(1) $2,433,832.00
I-35-A Variable(1) $2,356,513.00
I-36-A Variable(1) $2,280,617.00
I-37-A Variable(1) $1,929,688.00
I-38-A Variable(1) $2,136,022.50
I-39-A Variable(1) $2,068,050.50
I-40-A Variable(1) $2,004,585.50
I-41-A Variable(1) $1,942,609.50
I-42-A Variable(1) $1,881,936.50
I-43-A Variable(1) $1,822,448.50
I-44-A Variable(1) $1,764,216.00
I-45-A Variable(1) $1,707,430.50
I-46-A Variable(1) $1,651,516.50
I-47-A Variable(1) $1,592,815.50
I-48-A Variable(1) $1,530,631.50
I-49-A Variable(1) $1,480,132.50
I-50-A Variable(1) $1,430,812.00
I-51-A Variable(1) $1,382,609.00
I-52-A Variable(1) $1,335,228.00
I-53-A Variable(1) $1,290,799.50
I-54-A Variable(1) $1,249,779.50
I-55-A Variable(1) $1,216,306.50
I-56-A Variable(1) $1,182,467.50
I-57-A Variable(1) $1,148,402.50
I-58-A Variable(1) $1,101,741.00
I-59-A Variable(1) $22,855,295.50
I-1-B Variable(1) $4,662,780.50
I-2-B Variable(1) $4,602,074.00
I-3-B Variable(1) $4,540,633.50
I-4-B Variable(1) $4,477,855.00
I-5-B Variable(1) $4,413,539.50
I-6-B Variable(1) $4,348,000.50
I-7-B Variable(1) $4,281,942.50
I-8-B Variable(1) $4,214,959.00
I-9-B Variable(1) $4,146,664.50
I-10-B Variable(1) $4,077,436.50
I-11-B Variable(1) $4,007,896.50
I-12-B Variable(1) $3,937,706.00
I-13-B Variable(1) $3,884,191.00
I-14-B Variable(1) $3,819,367.50
I-15-B Variable(1) $3,754,262.00
I-16-B Variable(1) $3,688,571.00
I-17-B Variable(1) $3,622,105.50
I-18-B Variable(1) $3,555,005.00
I-19-B Variable(1) $3,487,856.00
I-20-B Variable(1) $3,420,134.50
I-21-B Variable(1) $3,352,085.50
I-22-B Variable(1) $3,284,184.00
I-23-B Variable(1) $3,216,067.50
I-24-B Variable(1) $3,146,343.50
I-25-B Variable(1) $3,073,734.50
I-26-B Variable(1) $3,000,620.00
I-27-B Variable(1) $2,927,939.50
I-28-B Variable(1) $2,855,518.50
I-29-B Variable(1) $2,783,857.50
I-30-B Variable(1) $2,713,634.50
I-31-B Variable(1) $2,643,924.50
I-32-B Variable(1) $2,574,608.00
I-33-B Variable(1) $2,505,515.50
I-34-B Variable(1) $2,433,832.00
I-35-B Variable(1) $2,356,513.00
I-36-B Variable(1) $2,280,617.00
I-37-B Variable(1) $1,929,688.00
I-38-B Variable(1) $2,136,022.50
I-39-B Variable(1) $2,068,050.50
I-40-B Variable(1) $2,004,585.50
I-41-B Variable(1) $1,942,609.50
I-42-B Variable(1) $1,881,936.50
I-43-B Variable(1) $1,822,448.50
I-44-B Variable(1) $1,764,216.00
I-45-B Variable(1) $1,707,430.50
I-46-B Variable(1) $1,651,516.50
I-47-B Variable(1) $1,592,815.50
I-48-B Variable(1) $1,530,631.50
I-49-B Variable(1) $1,480,132.50
I-50-B Variable(1) $1,430,812.00
I-51-B Variable(1) $1,382,609.00
I-52-B Variable(1) $1,335,228.00
I-53-B Variable(1) $1,290,799.50
I-54-B Variable(1) $1,249,779.50
I-55-B Variable(1) $1,216,306.50
I-56-B Variable(1) $1,182,467.50
I-57-B Variable(1) $1,148,402.50
I-58-B Variable(1) $1,101,741.00
I-59-B Variable(1) $22,855,295.50
A-I Variable(1) $4,103,002.41
_______________
(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." Component II of the Class
R-1 Certificates will represent the sole Class of "residual interests" in
REMIC II for purposes of the REMIC Provisions under federal income tax law.
Component II of the Class R-1 Certificates will not bear interest or have a
Certificate Principal Balance. 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.
Initial
Uncertificated Uncertificated
REMIC II REMIC II
Designation Pass-Through Rate Principal Balance
LT1 Variable(1) $371,547,956.41
LT2 Variable(1) $14,275.60
LT3 Variable(1) $22,885.20
LT4 Variable(1) $22,885.20
LT-IO Variable(1) (2)
____________
(1) Calculated as provided in the definition of Uncertificated REMIC II
Pass-Through Rate.
(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. Component III of the Class R-1 Certificates
will represent the sole Class of "residual interests" in REMIC III for
purposes of the REMIC Provisions under federal income tax law. Component III
of the Class R-1 Certificates will not bear interest or have a Certificate
Principal Balance. The following table irrevocably sets forth the
designation, Pass-Through Rate, aggregate Initial Certificate Principal
Balance, certain features, Maturity Date, initial ratings and minimum
denominations for each Class of Certificates that evidence "regular
interests" in REMIC III and REMIC III Regular Interests SB-IO, SB-PO and IO
(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 REMIC III Regular Interest
shall be the Maturity Date. REMIC III Regular Interests SB-IO, SB-PO and IO
will not be certificated.
Aggregate
Initial
Certificate
Pass-Through Principal Maturity Xxxxx'x / Minimum
Designation Type Rate Balance Features Date S&P Denominations
Super Senior
Adjustable /Adjustable Rate October 25,
Class A-1 Regular(1) Rate(2)(3) $314,545,000.00 2036 Aaa / AAA $100,000.00
Senior Support /
Regular(1) Adjustable Adjustable Rate October 25, Aaa / AAA $100,000.00
Class A-2 Rate(2)(3) $34,950,000.00 2036
Class M-1 Regular(1) Adjustable Mezzanine/Adjustable October 25, Aa2 / AA+ $100,000.00
Rate(2)(3) $8,920,000.00 Rate 2036
Class X-0 Xxxxxxx(0) Xxxxxxxxxx Xxxxxxxxx/Xxxxxxxxxx Xxxxxxx 00, X0 / XX $100,000.00
Rate(2)(3) $3,905,000.00 Rate 2036
Class M-3 Regular(1) Adjustable Mezzanine/Adjustable October 25, Baa1 / A $250,000.00
Rate(2)(3) $2,600,000.00 Rate 2036
Class M-4 Regular(1) Adjustable Mezzanine/Adjustable October 25, Baa2 / A- $250,000.00
Rate(2)(3) $1,300,000.00 Rate 2036
Class M-5 Regular(1) Adjustable Mezzanine/Adjustable October 25, Baa3/BBB+ $250,000.00
Rate(2)(3) $1,300,000.00 Rate 2036
Class M-6 Regular(1) Xxxxxxxxxx Xxxxxxxxx/Xxxxxxxxxx Xxxxxxx 00, Xx0 / XXX $250,000.00
Rate(2)(3) $1,673,000.00 Rate 2036
SB-IO Regular (4) (4) N/A Subordinate/Interest October 25, N/R N/A
Only 2036
SB-PO Regular (5) N/A $2,415,002.41 Subordinate/Principal October 25, N/R N/A
Only 2036
IO Regular (6) (7) Interest Only N/R N/R
(1) This Class of Certificates represents ownership of a REMIC III Regular
Interest together with (i) 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 holders of the Class SB
Certificates as the owners of the Swap Agreement, (ii) certain rights to
payments to be made from amounts received under the Yield Maintenance
Agreement or from the Yield Maintenance Reserve Fund which will be deemed
made for federal income tax purposes outside of REMIC III and (iii) an
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 Supplemental Interest Trust Account or pursuant to the
Yield Maintenance Agreement or from the Yield Maintenance Reserve Fund, as
applicable, 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 Supplemental Interest Trust Account, all pursuant to and as
further provided in Section 4.09 hereof.
(2) The Class A Certificates and Class 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 (but not more than 11.00% per annum).
(3) The Class A Certificates and Class M Certificates will also entitle
their holders to receive certain payments from the holders of the Class SB
Certificates from amounts to which the REMIC III Regular Interests are
entitled and from amounts received under the Swap Agreement, the Yield
Maintenance Agreement and the Yield Maintenance Reserve Fund, which will not
be a part of their ownership of the REMIC III Regular Interests.
(4) REMIC III Regular Interest SB-IO shall have no entitlement to
principal, and shall be entitled to distributions of interest subject to the
terms and conditions hereof, in an aggregate amount equal to the aggregate
interest distributable with respect to the Class SB Certificates pursuant to
the terms and conditions hereof.
(5) REMIC III Regular Interest 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
Overcollateralization Amount pursuant to the terms and conditions hereof.
(6) 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.
(7) 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 REMIC III Regular
Interests SB-IO, SB-PO and IO as a REMIC for federal income tax purposes, and
such segregated pool of assets will be designated as REMIC IV. The Class R-X
Certificates will represent the sole Class of "residual interests" in REMIC
IV for purposes of the REMIC Provisions under federal income tax law. The
Class R-X Certificates will not bear interest or have a Certificate Principal
Balance. The following table irrevocably sets forth the designation,
Pass-Through Rate, aggregate Initial Certificate Principal Balance, certain
features and Maturity Date for the Class SB Certificates which represent the
two "regular interests" in REMIC IV designated REMIC IV Regular Interest SB
and REMIC IV Regular Interest IO (the "REMIC IV Regular Interests"). The
"latest possible maturity date" (determined solely for purposes of satisfying
Treasury Regulation Section 1.860G-1(a)(4)(iii)) for the REMIC IV Regular
Interests shall be the Maturity Date.
Aggregate
Initial
Pass- Certificate
Through Principal Maturity
Designation Type Rate Balance Features Date
Class Regular (1) $2,415,002.41 Subordinate October
SB(1)) (1) 25, 2036
------------------------------------------------------------------------------
(1) The Class SB Certificates will accrue interest as described in the
definition of Accrued Certificate Interest.
REMIC IV Regular Interest IO will be held as an asset of the
Supplemental Interest Trust Account established by the Trustee and will be
treated for federal income tax purposes as owned by the holders of the Class
SB Certificates.
REMIC IV Regular Interest SB will not have a Pass-Through Rate,
but will be entitled to 100% of all amounts distributed or deemed distributed
on REMIC III Regular Interests SB-IO and SB-PO. REMIC IV Regular Interest IO
will not have a Pass-Through Rate, but will be entitled to 100% of all
amounts distributed or deemed distributed on REMIC III Regular Interest IO.
The rights of the holders of the Class SB Certificates to payments under the
Swap Agreement and SB-AM Swap Agreement shall be outside and apart from their
rights with respect to the REMIC IV Regular Interests.
The Mortgage Loans have an aggregate Cut-off Date Principal Balance
equal to $371,608,002.41. 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 A Certificates and Class 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 A-2
Certificates and Class M Certificates shall be reduced by the amount of
Prepayment Interest Shortfalls on the Mortgage Loans during the prior
calendar month to the extent not covered by Compensating Interest pursuant to
Section 3.16 and by Relief Act Shortfalls on the Mortgage Loans during the
related Due Period. All such reductions with respect to the Mortgage Loans
will be allocated among the Class A-2 Certificates and Class 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 M
Certificates for any Distribution Date shall further be reduced by the
interest portion of Realized Losses allocated to any Class of Class M
Certificates pursuant to Section 4.05.
Accrued Certificate Interest with respect to the Class A Certificates
and Class 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 SB Certificates,
interest accrued during the preceding Interest Accrual Period at the related
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 Mortgage 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
Section 4.02(c)(iii) and (iv). Accrued Certificate Interest on the Class SB
Certificates shall accrue on the basis of a 360-day year and the actual
number of days in the related Interest Accrual Period.
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.
Available Distribution Amount: As to any Distribution Date, 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) 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.
Basis Risk Shortfall: With respect to each Class of the Class A
Certificates and Class M Certificates, and any Distribution Date, (A) 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
(but not more than 11.00% per annum), 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 A and Class M Certificates.
Certificate: Any Class A, Class M, Class SB or Class R 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-QA9" and which must be an Eligible
Account.
Certificate Principal Balance: With respect to any Class A Certificate
or Class 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) and (y) in the case of any Class of Class 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 A-2 Certificates and
Class 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: first to the Class A-2 Certificates, and then
to the Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class M-5 and Class M-6
Certificates, in that order, but only to the extent of Subsequent Recoveries
received during the preceding calendar month.
Certificate Policy: None.
Class A Certificate: Any one of the Class A-1 or Class 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, senior to the Class M Certificates, Class SB Certificates and Class 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,
SB-AM Swap Agreement and Yield Maintenance Agreement, (iii) the right to
receive Basis Risk Shortfalls and (iv) an obligation to pay the Class IO
Distribution Amount.
Class 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
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 Principal Distribution Amount for that Distribution Date; and
(ii) the excess, if any, of (A) the aggregate Certificate Principal
Balance of the Class A Certificates immediately prior to that Distribution
Date over (B) the lesser of (x) the product of (1) the applicable
Subordination Percentage and (2) the aggregate Stated Principal Balance of
the Mortgage 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 Mortgage Loans after giving effect to
distributions to be made on that Distribution Date, over the
Overcollateralization Floor.
Class A-1 Certificate: The Class 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 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 A-2 Certificate: The Class 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 A-2 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 A-P Certificates: None.
Class B Certificates: None.
Class M Certificates: Collectively, the Class M-1, Class M-2, Class
M-3, Class M-4, Class M-5 and Class M-6 Certificates.
Class M-1 Certificate: Any one of the Class 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
M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class SB and Class 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,
SB-AM Swap Agreement and Yield Maintenance Agreement, (iii) the right to
receive Basis Risk Shortfalls and (iv) an obligation to pay the Class IO
Distribution Amount.
Class M-1 Margin: With respect to any Distribution Date prior to the
second Distribution Date after the first possible Optional Termination Date,
0.320% per annum, and on any Distribution Date on or after the second
Distribution Date after the first possible Optional Termination Date, 0.480%
per annum.
Class 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 Principal Distribution Amount for that Distribution Date after
distribution of the Class 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 Principal Distribution Amount for that Distribution
Date after distribution of the Class A Principal Distribution Amount; and
(ii) the excess, if any, of (A) the sum of (1) the aggregate
Certificate Principal Balance of the Class A Certificates (after taking into
account the payment of the Class A Principal Distribution Amount for that
Distribution Date) and (2) the Certificate Principal Balance of the Class M-1
Certificates immediately prior to that Distribution Date over (B) the lesser
of (x) the product of (1) the applicable Subordination Percentage and (2) the
aggregate Stated Principal Balance of the Mortgage 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 Mortgage Loans after
giving effect to distributions to be made on that Distribution Date, over the
Overcollateralization Floor.
Class M-2 Certificate: Any one of the Class 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
M-3, Class M-4, Class M-5, Class M-6, Class SB and Class 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, SB-AM Swap Agreement and Yield
Maintenance Agreement, (iii) the right to receive Basis Risk Shortfalls and
(iv) an obligation to pay the Class IO Distribution Amount.
Class M-2 Margin: With respect to any Distribution Date prior to the
second Distribution Date after the first possible Optional Termination Date,
0.410% per annum, and on any Distribution Date on or after the second
Distribution Date after the first possible Optional Termination Date, 0.615%
per annum.
Class 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 Principal Distribution Amount for that Distribution Date after
distribution of the Class A Principal Distribution Amount and Class 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 Principal Distribution Amount for that Distribution
Date after distribution of the Class A Principal Distribution Amount and the
Class 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 A Certificates and Class M-1
Certificates (after taking into account the payment of the Class A Principal
Distribution Amount and the Class M-1 Principal Distribution Amount for that
Distribution Date) and (2) the Certificate Principal Balance of the Class M-2
Certificates immediately prior to that Distribution Date over (B) the lesser
of (x) the product of (1) the applicable Subordination Percentage and (2) the
aggregate Stated Principal Balance of the Mortgage 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 Mortgage Loans after
giving effect to distributions to be made on that Distribution Date, over the
Overcollateralization Floor.
Class M-3 Certificate: Any one of the Class 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, senior to the Class
M-4, Class M-5, Class M-6, Class SB Certificates and Class 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, SB-AM Swap Agreement
and Yield Maintenance Agreement, (iii) the right to receive Basis Risk
Shortfalls and (iv) an obligation to pay the Class IO Distribution Amount.
Class M-3 Margin: With respect to any Distribution Date prior to the
second Distribution Date after the first possible Optional Termination Date,
0.900% per annum, and on any Distribution Date on or after the second
Distribution Date after the first possible Optional Termination Date, 1.350%
per annum.
Class 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 Principal Distribution Amount for that Distribution Date after
distribution of the Class A Principal Distribution Amount, Class M-1
Principal Distribution Amount and Class 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 Principal Distribution Amount for that Distribution
Date after distribution of the Class A Principal Distribution Amount,
Class M-1 Principal Distribution Amount and Class 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 A, Class M-1 and Class M-2
Certificates (after taking into account the payment of the Class A Principal
Distribution Amount, the Class M-1 Principal Distribution Amount and the
Class M-2 Principal Distribution Amount for that Distribution Date) and
(2) the Certificate Principal Balance of the Class M-3 Certificates
immediately prior to that Distribution Date over (B) the lesser of (x) the
product of (1) the applicable Subordination Percentage and (2) the aggregate
Stated Principal Balance of the Mortgage 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 Mortgage Loans after
giving effect to distributions to be made on that Distribution Date, over the
Overcollateralization Floor.
Class M-4 Certificate: Any one of the Class M-4 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
M-5, Class M-6, Class SB Certificates and Class 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, SB-AM Swap Agreement and Yield
Maintenance Agreement, (iii) the right to receive Basis Risk Shortfalls and
(iv) an obligation to pay the Class IO Distribution Amount.
Class M-4 Margin: With respect to any Distribution Date prior to the
second Distribution Date after the first possible Optional Termination Date,
1.100% per annum, and on any Distribution Date on or after the second
Distribution Date after the first possible Optional Termination Date, 1.650%
per annum.
Class 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 Principal Distribution Amount for that Distribution Date after
distribution of the Class A Principal Distribution Amount, Class M-1
Principal Distribution Amount, Class M-2 Principal Distribution Amount and
Class 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 Principal Distribution Amount for that Distribution
Date after distribution of the Class A Principal Distribution Amount,
Class M-1 Principal Distribution Amount, Class M-2 Principal Distribution
Amount and Class 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 A, Class M-1, Class M-2 and
Class M-3 Certificates (after taking into account the payment of the Class A
Principal Distribution Amount, the Class M-1 Principal Distribution Amount,
the Class M-2 Principal Distribution Amount and the Class M-3 Principal
Distribution Amount for that Distribution Date) and (2) the Certificate
Principal Balance of the Class M-4 Certificates immediately prior to that
Distribution Date over (B) the lesser of (x) the product of (1) the
applicable Subordination Percentage and (2) the aggregate Stated Principal
Balance of the Mortgage 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 Mortgage Loans after giving effect to distributions
to be made on that Distribution Date, over the Overcollateralization Floor.
Class M-5 Certificate: Any one of the Class M-5 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
M-6, Class SB Certificates and Class 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, SB-AM Swap Agreement and Yield Maintenance
Agreement, (iii) the right to receive Basis Risk Shortfalls and (iv) an
obligation to pay the Class IO Distribution Amount.
Class M-5 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 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 Principal Distribution Amount for that Distribution Date after
distribution of the Class A Principal Distribution Amount, Class M-1
Principal Distribution Amount, Class M-2 Principal Distribution Amount,
Class M-3 Principal Distribution Amount and Class 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 Principal Distribution Amount for that Distribution
Date after distribution of the Class A Principal Distribution Amount,
Class M-1 Principal Distribution Amount, the Class M-2 Principal Distribution
Amount, Class M-3 Principal Distribution Amount and Class 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 A, Class M-1, Class M-2, Class M-3
and Class M-4 Certificates (after taking into account the payment of the
Class A Principal Distribution Amount, the Class M-1 Principal Distribution
Amount, the Class M-2 Principal Distribution Amount, the Class M-3 Principal
Distribution Amount and the Class M-4 Principal Distribution Amount for that
Distribution Date) and (2) the Certificate Principal Balance of the Class M-5
Certificates immediately prior to that Distribution Date over (B) the lesser
of (x) the product of (1) the applicable Subordination Percentage and (2) the
aggregate Stated Principal Balance of the Mortgage 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 Mortgage Loans after
giving effect to distributions to be made on that Distribution Date, over the
Overcollateralization Floor.
Class M-6 Certificate: Any one of the Class M-6 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
SB Certificates and Class 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, SB-AM Swap Agreement and Yield Maintenance
Agreement, (iii) the right to receive Basis Risk Shortfalls and (iv) an
obligation to pay the Class IO Distribution Amount.
Class M-6 Margin: With respect to any Distribution Date prior to the
second Distribution Date after the first possible Optional Termination Date,
2.000% per annum, and on any Distribution Date on or after the second
Distribution Date after the first possible Optional Termination Date, 3.000%
per annum.
Class 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 Principal Distribution Amount for that Distribution Date after
distribution of the Class A Principal Distribution Amount, Class M-1
Principal Distribution Amount, Class M-2 Principal Distribution Amount,
Class M-3 Principal Distribution Amount, Class M-4 Principal Distribution
Amount and Class 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 Principal Distribution Amount for that Distribution
Date after distribution of the Class A Principal Distribution Amount,
Class M-1 Principal Distribution Amount, the Class M-2 Principal Distribution
Amount, Class M-3 Principal Distribution Amount, Class M-4 Principal
Distribution Amount and Class 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 A, Class M-1, Class M-2,
Class M-3, Class M-4 and Class M-5 Certificates (after taking into account
the payment of the Class A Principal Distribution Amount, the Class M-1
Principal Distribution Amount, the Class M-2 Principal Distribution Amount,
the Class M-3 Principal Distribution Amount, the Class M-4 Principal
Distribution Amount and the Class M-5 Principal Distribution Amount for that
Distribution Date) and (2) the Certificate Principal Balance of the Class M-6
Certificates immediately prior to that Distribution Date over (B) the lesser
of (x) the product of (1) the applicable Subordination Percentage and (2) the
aggregate Stated Principal Balance of the Mortgage 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 Mortgage Loans after
giving effect to distributions to be made on that Distribution Date, over the
Overcollateralization Floor.
Class R Certificate: Any one of the Class R-1 or Class R-X
Certificates.
Class R-1 Certificate: Any one of the Class R-1 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
ownership of interests designated as "residual interests" in REMIC I,
REMIC II and REMIC III for purposes of the REMIC Provisions. Component I of
the Class R-1 Certificates is designated as the sole class of "residual
interest" in REMIC I, Component II of the Class R-1 Certificates is
designated as the sole class of "residual interest" in REMIC II and
Component III of the Class R-1 Certificates is designated as the sole class
of "residual interest" in REMIC III.
Class R-X Certificate: Any one of the Class R-X 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
ownership of an interest designated as a "residual interest" in REMIC IV for
purposes of the REMIC Provisions.
Class SB Certificate: Any one of the Class SB Certificates executed by
the Trustee and authenticated by the Certificate Registrar substantially in
the form annexed to the Standard Terms as Exhibit C-II, subordinate to the
Class A Certificates and Class M Certificates with respect to distributions
and the allocation of Realized Losses as set forth in Section 4.05, and
evidencing ownership of the REMIC IV Regular Interests 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.
Closing Date: October 30 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 Company, LLC, RALI
2006-QA9.
Custodial File: Any mortgage loan document in the Mortgage File that is
required to be delivered to the Trustee or the Custodian pursuant to Section
2.01(b) of this Agreement.
Cut-off Date Balance: $371,608,002.41.
Cut-off Date: October 30, 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: Not applicable.
Excess Cash Flow: With respect to any Distribution Date, an amount
equal to the sum of (A) the excess of (i) the Available Distribution Amount
for that Distribution Date over (ii) the sum of (a) the Interest Distribution
Amount for that Distribution Date and (b) the lesser of (1) the aggregate
Certificate Principal Balance of Class A Certificates and Class M
Certificates immediately prior to such Distribution Date and (2) the
Principal Remittance Amount for that Distribution Date to the extent not
applied to pay interest on the Class A Certificates and Class M Certificates
on such Distribution Date, (B) the Overcollateralization Reduction Amount, if
any, for that Distribution Date and (C) any Net Swap Payments received by the
Supplemental Interest Trust Trustee under the Swap Agreement for that
Distribution Date and deposited in the Supplemental Interest Trust Account
pursuant to Section 4.09(c).
Excess Fraud Loss: Not applicable.
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: Not applicable.
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.
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.
Index: With respect to any Mortgage Loan and as to any Adjustment Date
therefor, the related index as stated in the related Mortgage Note.
Initial Subordinate Class Percentage: Not applicable.
Interest Accrual Period: (i) With respect to the Distribution Date in
November 2006, the period commencing on the Closing Date and ending on the
day immediately preceding the Distribution Date in November 2006, and with
respect to any Distribution Date after the Distribution Date in November
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.
Interest Distribution Amount: For any Distribution Date, the aggregate
of the amounts payable pursuant to Section 4.02(c)(i).
Interest Only Certificates: None.
LIBOR: With respect to any Distribution Date, the arithmetic mean of
the London 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 London, England are required or
authorized to by law to be closed.
LIBOR Certificates: The Class A Certificates and Class 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.
Margin: The Class A Margin, Class M-1 Margin, Class M-2 Margin, Class
M-3 Margin, Class M-4 Margin, Class M-5 Margin or Class M-6 Margin, as
applicable.
Marker Rate: With respect to the Class SB Certificates or REMIC III
Regular Interest 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: October 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 Loan Schedule: The list or lists of the Mortgage Loans
attached hereto as Exhibit One ( 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 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. 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.
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 Supplemental Interest Trust Trustee, on
behalf of the Supplemental Interest Trust, which net payment shall not take
into account any Swap Termination Payment.
Net WAC Cap Rate: With respect to any Distribution Date, 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 Mortgage
Loans using the Net Mortgage Rates in effect for the Monthly Payments due on
the Mortgage 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 Mortgage 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.
Note Margin: With respect to each Mortgage Loan, the fixed percentage
set forth in the related Mortgage Note and indicated in Exhibit One 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 any Distribution Date and the Class SB
Certificates, the aggregate Stated Principal Balance of the Mortgage Loans
immediately prior to such Distribution Date. For REMIC purposes, with
respect to the Class SB Certificates or REMIC III Regular Interest SB-IO,
immediately prior to any Distribution Date, the aggregate of the
Uncertificated Principal Balances of the REMIC II Regular Interests.
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 A Certificates and Class M Certificates immediately
prior to such date.
Overcollateralization Floor: An amount equal to the product of 0.50%
and the 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 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 Principal Remittance Amount on such
Distribution Date.
Pass-Through Rate: With respect to the Class of Class A and Class M
Certificates and any Distribution Date, a per annum rate equal to the least
of (i) LIBOR plus the related Margin, (ii) the Net WAC Cap Rate and (iii)
11.00% per annum.
With respect to the Class SB Certificates or REMIC III Regular Interest
SB-IO and any Distribution Date, a per annum rate equal to the percentage
equivalent of a fraction, the numerator of which is the sum of the amounts
calculated pursuant to clauses (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
SB Certificates or REMIC III Regular Interest 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.
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 assumes a
constant prepayment rate of 30% per annum of the then outstanding principal
balance of the Mortgage 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 SB Certificates
are entitled, as indicated on the Mortgage Loan Schedule.
Principal Distribution Amount: With respect to any Distribution Date,
the lesser of (a) the excess of (x) Available Distribution Amount plus for
inclusion in Excess Cash Flow for purposes of clauses (b)(v) and (b)(vi)
below, the amounts received by the Supplemental Interest Trust Trustee under
the Swap Agreement for that Distribution Date over (y) the 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;
(ii) the Stated Principal Balance of any Mortgage Loan 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 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 for such Distribution
Date and (2) the principal portion of any Realized Losses allocated to the
Class A-2 Certificates or the Class M 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 the
calendar month preceding such Distribution Date that are allocated to any
Class of Certificates; 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.
Principal Only Certificates: None.
Principal Remittance Amount: With respect to any Distribution Date,
all amounts described in clauses (b)(i) through (iii) of the definition of
Principal Distribution Amount for that Distribution Date.
Record Date: With respect to each Distribution Date and each Class of
Book Entry Certificates, the Business Day immediately preceding such
Distribution Date. With respect to each Class of Definitive Certificates,
the close of business on the last Business Day of the month next preceding
the month in which the related Distribution Date occurs, except in the case
of the first Record Date which shall be the Closing Date.
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 Supplemental
Interest Trust Account, the Swap Agreement, the SB-AM Swap Agreement, the
Yield Maintenance Agreement and the Yield Maintenance Reserve Fund), with
respect to which a REMIC election is to be made, consisting of:
(i) the Mortgage Loans and the related Mortgage Files;
(ii) all payments and collections in respect of the Mortgage
Loans 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 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, if any; and
(v) all proceeds of clauses (i) through (iv) above.
REMIC I Available Distribution Amount: The Available Distribution
Amount 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 R-1 Certificates in respect of
Component I thereof in the following amounts and priority:
(a) to REMIC I Regular Interest A-I and REMIC I Regular
Interest I-1-A through I-59-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;
(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-59-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; and
(c) any remaining amounts to the Class R-1 Certificates in
respect of Component I thereof.
REMIC I Interests: The REMIC I Regular Interests and Component I of
the Class R-1 Certificates.
REMIC I Realized Losses: All Realized Losses on the Mortgage 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-59-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 R-1 Certificates in respect to
of Component II thereof 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 clause (vii) in Section 4.02(c); 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 R-1 Certificates in
respect of Component II thereof, 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 REMIC I Regular
Date Interest Rate
1 I-1-A through I-59-A 2 multiplied by Swap LIBOR, subject to a
maximum rate of Uncertificated REMIC I
Pass-Through Rate
2 I-2-A through I-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-59-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-44-A through I-59-A 2 multiplied by Swap LIBOR, subject to a
maximum rate of Uncertificated REMIC I
Pass-Through Rate
I-1-A through I-43-A Uncertificated REMIC I Pass-Through Rate
45 I-45-A through I-59-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
46 I-46-A through I-59-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
47 I-47-A through I-59-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
48 I-48-A through I-59-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
49 I-49-A through I-59-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
50 I-50-A through I-59-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
51 I-51-A through I-59-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
52 I-52-A through I-59-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
53 I-53-A through I-59-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
54 I-54-A through I-59-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
55 I-55-A through I-59-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
56 I-56-A through I-59-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
57 I-57-A through I-59-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
58 I-58-A through I-59-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
59 I-59-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
Thereafter I-1-A through I-59-A 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).
(DELTA)Y1 = the REMIC II Regular Interest LT1 Principal Reduction
Amount.
(DELTA)Y2 = the REMIC II Regular Interest LT2 Principal Reduction
Amount.
(DELTA)Y3 = the REMIC II Regular Interest LT3 Principal Reduction
Amount.
(DELTA)Y4 = 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.
(DELTA)P = 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 Certificates on such Distribution Date (including
distributions of accrued and unpaid interest on the Class 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.
(alpha) = (Y2 + Y3)/P0. The initial value of (alpha) on the Closing
Date for use on the first Distribution Date shall be 0.0001.
(gamma)0 = the lesser of (A) the sum for all Classes of Certificates
other than the Class 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.
(gamma)1 = the lesser of (A) the sum for all Classes of Certificates
other than the Class 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:
(DELTA)Y1 = (DELTA)P - (DELTA)Y2 - Y3 - Y4;
(DELTA)Y2 = (a/2){(a0R1 - a1R0)/R0R1};
(DELTA)Y3 = (a(DELTA)P - (DELTA)Y2; and
(DELTA)Y4 = (DELTA)Y3.
if both (DELTA)Y2 and (DELTA)Y3, as so determined, are
non-negative numbers. Otherwise:
(1) If (DELTA)Y2, as so determined, is negative, then
(DELTA)Y2 = 0
(DELTA)Y3 = a{a1R0P0 - a0R1P1}/{a1R0};
(DELTA)Y4 = (DELTA)Y3; and
(DELTA)Y1 = (DELTA)P - (DELTA)Y2 - (DELTA)Y3 -
(DELTA)Y4.
(2) If (DELTA)Y3, as so determined, is negative, then
(DELTA)Y3 = 0;
(DELTA)Y2 = a{a0R1P1 - a1R0P0}/{2R1R0P1 - a1R0};
(DELTA)Y4 = (DELTA)Y3; and
(DELTA)Y1 = (DELTA)P - (DELTA)Y2 - (DELTA)Y3 -
(DELTA)Y4.
REMIC II Realized Losses: Realized Losses on the Mortgage Loans shall
be allocated to the REMIC II Regular Interests as follows. The interest
portion of Realized Losses on the Mortgage 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 Mortgage Loan and allocated
pursuant to the succeeding sentences. The principal portion of Realized
Losses with respect to Mortgage 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 the
Class A Certificates and Class M Certificates in respect of the portion of
such Certificates representing ownership of REMIC III Regular Interests,
REMIC III Regular Interests SB-IO, SB-PO and IO and the Class R-1
Certificates in respect of Component III thereof in the following amounts and
priority:
(i) to REMIC IV 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 A Certificateholders, the Accrued Certificate
Interest payable on the Class 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 M Certificateholders, from the amount, if any, of
the Available Distribution Amount remaining after the foregoing
distributions, Accrued Certificate Interest payable on the Class 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 M-1 Certificateholders, Class
M-2 Certificateholders, Class M-3 Certificateholders, Class M-4
Certificateholders, Class M-5 Certificateholders and Class M-6
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 A-Principal Distribution Amount shall be
distributed to the Class A-1 Certificateholders and Class A-2
Certificateholders, on a pro rata basis in accordance with their
respective Certificate Principal Balances, in each case until the
Certificate Principal Balance thereof has been reduced to zero;
(B) second, to the Class M-1 Certificateholders, the Class M-1
Principal Distribution Amount, until the Certificate Principal Balance of
the Class M-1 Certificates has been reduced to zero;
(C) third, to the Class M-2 Certificateholders, the Class M-2
Principal Distribution Amount, until the Certificate Principal Balance of
the Class M-2 Certificates has been reduced to zero;
(D) fourth, to the Class M-3 Certificateholders, the Class M-3
Principal Distribution Amount, until the Certificate Principal Balance of
the Class M-3 Certificates has been reduced to zero;
(E) fifth, to the Class M-4 Certificateholders, the Class M-4
Principal Distribution Amount, until the Certificate Principal Balance of
the Class M-4 Certificates has been reduced to zero;
(F) sixth, to the Class M-5 Certificateholders, the Class M-5
Principal Distribution Amount, until the Certificate Principal Balance of
the Class M-5 Certificates has been reduced to zero;
(G) seventh, to the Class M-6 Certificateholders, the Class M-6
Principal Distribution Amount, until the Certificate Principal Balance of
the Class M-6 Certificates has been reduced to zero; and
(v) to the Class A Certificateholders and Class 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 A Certificateholders and Class 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 REMIC IV in respect of REMIC III Regular Interests SB-IO and
SB-PO, (A) from the amount, if any, of the REMIC III Available Distribution
Amount remaining after the foregoing distributions, the sum of (I) Accrued
Certificate Interest on the Class SB Certificates, (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 A Certificates and Class M Certificates has been reduced to
zero, the Overcollateralization Amount and (B) from prepayment charges on
deposit in the Certificate Account, any prepayment charges received on the
Mortgage Loans during the related Prepayment Period; and
(viii) to the Class R-1 Certificateholders in respect of Component
III thereof, the balance, if any, of the REMIC III Available Distribution
Amount.
REMIC III Regular Interest SB-PO: A separate uncertificated beneficial
ownership interest in REMIC III issued hereunder and designated as a Regular
Interest in REMIC III, held as an asset of REMIC IV. REMIC III Regular
Interest 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 Overcollateralization Amount as set
forth in the Preliminary Statement hereto.
REMIC III Regular Interest SB-IO: A separate uncertificated beneficial
ownership interest in REMIC III issued hereunder and designated as a Regular
Interest in REMIC III, held as an asset of REMIC IV. REMIC III Regular
Interest 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 SB Certificates pursuant to the terms and conditions hereof.
REMIC III Regular Interest IO: A separate uncertificated beneficial
ownership interest in REMIC III issued hereunder and designated as a Regular
Interest in REMIC III, held as an asset of REMIC IV. 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 SB-IO, SB-PO
and IO, together with the Class A Certificates and Class M Certificates
exclusive of their respective rights to receive the payment of Basis Risk
Shortfalls and other amounts pursuant to the Swap Agreement, the SB-AM Swap
Agreement and the Yield Maintenance Agreement.
REMIC IV: 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
REMIC III Regular Interests SB-IO, SB-PO and IO.
REMIC IV Available Distribution Amount: For any Distribution Date, the
amounts deemed distributed from REMIC III to REMIC IV on such Distribution
Date in respect of REMIC III Regular Interests SB-IO, SB-PO and IO pursuant
to the definition of REMIC III Distribution Amount.
REMIC IV Distribution Amount: For any Distribution Date, the REMIC IV
Available Distribution Amount shall be deemed distributed by REMIC IV to the
holders of the Class SB Certificates on account of REMIC IV Regular Interest
SB and to the Supplemental Interest Trust Account on account of REMIC IV
Regular Interest IO.
REMIC IV Regular Interests. Either of the separate beneficial
ownership interests in REMIC IV issued hereunder and designated as a "regular
interest" in REMIC IV. The REMIC IV Regular Interests shall be entitled to
distributions of interest and principal, subject to the terms and conditions
hereof, as set forth in the Preliminary Statement hereto.
Required Overcollateralization Amount: With respect to any
Distribution Date (i) prior to the Stepdown Date, an amount equal to 0.65% of
the aggregate Stated Principal Balance of the Mortgage Loans as of the
Cut-off Date; (ii) on or after the Stepdown Date, the greater of (x) 1.30% of
the outstanding aggregate Stated Principal Balance of the Mortgage Loans
after giving effect to distributions made on that Distribution Date and (y)
the Overcollateralization Floor; and (iii) on or after the Stepdown Date if a
Trigger Event is in effect, the Required Overcollateralization Amount for the
immediately preceding Distribution Date; provided 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
ratings assigned to the Class A Certificates and Class M Certificates by that
rating agency below the lower of the then-current ratings or the ratings
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.
Rule 144A Global Offered Certificate: Any one of the Class SB
Certificates substantially in the form annexed to the Standard Terms as
Exhibit C-II, asmore fully described in Section 5.02(g) hereof.
SB-AM Swap Agreement: The interest rate swap agreement between the
Trustee, on behalf of the Class A Certificateholders and Class M
Certificateholders, and the Trustee, on behalf of the Class SB
Certificateholders, evidenced by the confirmation attached hereto as Exhibit
Five and incorporated herein by reference.
Senior Certificate: Any one of the Class A Certificates.
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 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 after giving effect
to distributions to be made on that Distribution Date.
Sixty-Plus Delinquency Percentage: With respect to any Distribution
Date on or after the Stepdown date, 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 that are 60 or more days delinquent
in payment of principal and interest for that Distribution Date, including
Mortgage Loans in foreclosure, and REO Properties over (y) the aggregate
Stated Principal Balance of all of the Mortgage Loans immediately preceding
that 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 (i) the Distribution Date
immediately succeeding the Distribution Date on which the aggregate
Certificate Principal Balance of the Class A Certificates has been reduced to
zero or (ii) the later to occur of (x) the Distribution Date in November 2009
and (y) 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 due on the related Due Date or
received during the related Prepayment Period but prior to distribution of
the 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 11.90%.
Subordination Percentage: With respect to each class of Class A
Certificates and Class M Certificates, the respective approximate percentage
set forth in the table below:
Class Percentage
A 88.10
M-1 92.90
M-2 95.00
M-3 96.40
M-4 97.10
M-5 97.80
M-6 98.70
Supplemental Interest Trust Account: The separate trust account
created and maintained by the Trustee pursuant to Section 4.09(a).
Supplemental Interest Trust: The separate trust created and maintain
by the Supplemental Interest Trust Trustee pursuant to Section 4.09(a). The
primary activities of the Supplemental Interest Trust created pursuant to
this Agreement shall be:
(i) holding the Swap Agreement;
(ii) receiving collections or making payments with respect to
the Swap Agreement; and
(iii) engaging in other activities that are necessary or
incidental to accomplish these limited purposes, which activities
cannot be contrary to the status of the Supplemental Interest Trust as
a qualified special purpose entity under existing accounting
literature.
Supplemental Interest Trust Trustee: Deutsche Bank Trust Company
Americas, a national banking association, not in its individual capacity, but
solely in its capacity as trustee of the Supplemental Interest Trust, and any
successor thereto, and any corporation or national banking association
resulting from or surviving any consolidation or merger to which it or its
successors may be a party and any successor trustee as may from time to time
be serving as successor trustee hereunder.
Swap Agreement: The interest rate swap agreement between the Swap
Counterparty and the Supplemental Interest Trust Trustee, on behalf of the
Supplemental Interest 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 Four.
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 Supplemental Interest Trust
Trustee from amounts payable by the Supplemental Interest Trust under this
Agreement or (b) required to make payments to the Supplemental Interest Trust
Trustee for payment to the Supplemental Interest Trust, in either case
pursuant to the terms of the Swap Agreement, and any successor in interest or
assign. Initially, the Swap Counterparty shall be Bear Xxxxxxx Financial
Products 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 (other
than Illegality or Tax 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 Termination Payment: Upon the occurrence of an Early Termination
Date, the payment to be made by the Supplemental Interest Trust Trustee on
behalf of the Supplemental Interest Trust to the Swap Counterparty from
payments from the Supplemental Interest Trust, or by the Swap Counterparty to
the Supplemental Interest Trust Trustee for payment to the Supplemental
Interest Trust, as applicable, pursuant to the terms of the Swap Agreement.
Trigger Event: 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
34.00% of the Senior Enhancement Percentage for that Distribution Date or (b)
the aggregate amount of Realized Losses on the Mortgage Loans as a percentage
of the initial aggregate Stated Principal Balance as of the Cut-off Date
exceeds the applicable amount set forth below:
o November 2009 to October 2010: 0.20% with respect to November 2009,
plus an additional 1/12th of 0.35% for each month through October 2010.
o November 2010 to October 2011: 0.55% with respect to November 2010,
plus an additional 1/12th of 0.40% for each month through October 2011.
o November 2011 to October 2012: 0.95% with respect to November 2011,
plus an additional 1/12th of 0.40% for each month through October 2012.
o November 2012 to October 2013: 1.35% with respect to November 2012,
plus an additional 1/12th of 0.25% for each month through October 2013.
o November 2013 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 Interest on REMIC III Regular
Interest SB-PO shall be zero. Uncertificated Accrued Interest on REMIC III
Regular Interest SB-IO for each Distribution Date shall equal Accrued
Certificate Interest for the Class SB Certificates.
Uncertificated Notional Amount: With respect to the Class SB
Certificates or REMIC III Regular Interest 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 X-00-X
0 X-0-X xxxxxxx X-00-X
0 X-0-X through X-00-X
0 X-0-X xxxxxxx X-00-X
0 X-0-X through X-00-X
0 X-0-X xxxxxxx X-00-X
0 X-0-X through X-00-X
0 X-0-X xxxxxxx X-00-X
0 X-0-X through I-59-A
10 I-10-A through I-59-A
11 I-11-A through I-59-A
12 I-12-A through I-59-A
13 I-13-A through I-59-A
14 I-14-A through I-59-A
15 I-15-A through I-59-A
16 I-16-A through I-59-A
17 I-17-A through I-59-A
18 I-18-A through I-59-A
19 I-19-A through I-59-A
20 I-20-A through I-59-A
21 I-21-A through I-59-A
22 I-22-A through I-59-A
23 I-23-A through I-59-A
24 I-24-A through I-59-A
25 I-25-A through I-59-A
26 I-26-A through I-59-A
27 I-27-A through I-59-A
28 I-28-A through I-59-A
29 I-29-A through I-59-A
30 I-30-A through I-59-A
31 I-31-A through I-59-A
32 I-32-A through I-59-A
33 I-33-A through I-59-A
34 I-34-A through I-59-A
35 I-35-A through I-59-A
36 I-36-A through I-59-A
37 I-37-A through I-59-A
38 I-38-A through I-59-A
39 I-39-A through I-59-A
40 I-40-A through I-59-A
41 I-41-A through I-59-A
42 I-42-A through I-59-A
43 I-43-A through I-59-A
44 I-44-A through I-59-A
45 I-45-A through I-59-A
46 I-46-A through I-59-A
47 I-47-A through I-59-A
48 I-48-A through I-59-A
49 I-49-A through I-59-A
50 I-50-A through I-59-A
51 I-51-A through I-59-A
52 I-52-A through I-59-A
53 I-53-A through I-59-A
54 I-54-A through I-59-A
55 I-55-A through I-59-A
56 I-56-A through I-59-A
57 I-57-A through I-59-A
58 I-58-A through I-59-A
59 I-59-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.
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 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,
the REMIC II Regular Interests and REMIC III Regular Interests SB-IO, SB-PO
and IO.
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 Mortgage Loans multiplied by
two (2), subject to a maximum rate of 10.434%. 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 Mortgage Loans over (ii) 10.434% and (y)
0.00000%. With respect to REMIC I Regular Interest A-I, the weighted average
of the Net Mortgage Rates of the Mortgage 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: Credit Suisse Securities (USA) LLC.
Yield Maintenance Agreement: The agreement, dated as of the Closing
Date, between the Trustee and the Yield Maintenance Agreement Provider,
relating to the Class A Certificates and Class M Certificates, or any
replacement, substitute, collateral or other arrangement in lieu thereto.
Yield Maintenance Agreement Excess Amount: With respect to any
Distribution Date, the excess, if any, of (i) the Yield Maintenance Payment
for such Distribution Date over (ii) the Yield Maintenance Certificates
Payment for such Distribution Date.
Yield Maintenance Agreement Provider: Credit Suisse International, and
its successors and assigns or any party to any replacement, substitute,
collateral or other arrangement in lieu thereof.
Yield Maintenance Certificates Payment: On any Distribution Date, the
lesser of (i) the aggregate of Basis Risk Shortfalls for all Classes of
Certificates on such Distribution Date prior to any distributions on such
Distribution Date and (ii) the Yield Maintenance Payment for such
Distribution Date.
Yield Maintenance Payment: With respect to any Distribution Date from
and including the Distribution Date in October 2011 to and including the
Distribution Date in September 2013, the amount due under the Yield
Maintenance Agreement which is equal to (a) the product of (i) the positive
excess, if any, of (A) the lesser of (x) LIBOR and (y) 9.770% per annum, over
(B) a per annum rate equal to the "Cap Strike Rate" for such Distribution
Date as set forth in the Additional Terms table in the Yield Maintenance
Agreement, and (ii) the lesser of (x) the aggregate Certificate Principal
Balance of the Class A and Class M Certificates immediately prior to such
Distribution Date, and (y) the amount set forth for such Distribution Date in
the Additional Terms table in the Yield Maintenance Agreement.
Yield Maintenance Reserve Fund: The separate account created and
maintained pursuant to Section 4.10(a) hereof.
Yield Maintenance Reserve Fund Payment Amount: With respect to any
Distribution Date from and including the Distribution Date in October 2011 to
and including the Distribution Date in September 2013, the least of (i)
aggregate Basis Risk Shortfalls for all classes of Certificates on such
Distribution Date after application of the Yield Maintenance Certificates
Payment but prior to the distribution of Excess Cash Flow on such
Distribution Date, (ii) amounts on deposit in the Yield Maintenance Reserve
Fund on such Distribution Date and (iii) the product of (I) the positive
excess, if any, of (A) the lesser of (x) LIBOR and (y) 9.770% per annum, over
(B) per annum rate equal to the "Cap Strike Rate" for such Distribution Date
as set forth in the Additional Terms table in the Yield Maintenance
Agreement, and (II) the positive excess, if any, of (A) the aggregate
Certificate Principal Balance of the Class A and Class M Certificates
immediately prior to such Distribution Date over (B) the amount set forth
for such Distribution Date in the Additional Terms table in the Yield
Maintenance Agreement.
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 London 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.
Notwithstanding the foregoing, for the purpose of determining the
amount of any payment to be under the Swap Agreement and Yield Maintenance
Agreement, LIBOR will be calculated as provided in the Swap Agreement and
Yield Maintenance Agreement, respectively.
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, if any, 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.
(a) (See Section 2.01(a) of the Standard Terms).
(b) (See Section 2.01(b) of the Standard Terms).
(c) (See Section 2.01(c) of the Standard Terms).
(d) (See Section 2.01(d) of the Standard Terms).
(e) (See Section 2.01(e) of the Standard Terms).
(f) (See Section 2.01(f) of the Standard Terms).
(g) (See Section 2.01(g) of the Standard Terms).
(h) (See Section 2.01(h) of the Standard Terms).
(i) In connection with such assignment, and contemporaneously with
the delivery of this Agreement, the Company delivered or caused to be
delivered hereunder to the Trustee, the Yield Maintenance Agreement (the
delivery of which shall evidence that the fixed payment for each of the Yield
Maintenance Agreement has been paid and the Trustee and the Trust Fund shall
have no further payment obligation thereunder and that such fixed payment has
been authorized hereby).
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) (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 and provided that the
percentages of the Mortgage Loans described in this clause (b) are
approximate percentages by aggregate Stated Principal Balance determined as
of the Cut-off Date after deducting payments due during the month of the
Cut-off Date):
(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 One 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 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, each Mortgage Loan is required
to be covered by a standard hazard insurance policy. 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 0.08% of the Mortgage Loans are secured by Mortgaged
Properties located in any one zip code area in Florida, and no
more than 0.07% of the Mortgage Loans are secured by Mortgaged
Properties located in any one zip code area outside Florida;
(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 70.26% of the Mortgage Loans were underwritten under a
reduced loan documentation program, no more than 6.35% of the
Mortgage Loans were underwritten under a no-stated income
program, and no more than 6.04% of the Mortgage Loans were
underwritten under a no income/no asset program;
(x) Except with respect to no more than 12.27% of the Mortgage Loans, 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 have 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 Custodial
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 Custodial 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 R-1
Certificates in authorized denominations Component I of which, together with
the REMIC I Regular Interests, evidence the beneficial interest in REMIC I,
and Component II of which, together with the REMIC II Regular Interests,
evidence the beneficial interest in REMIC II.
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 R-1 Certificates in respect of
Components I and II, and with respect to REMIC III Regular Interests SB-IO,
SB-PO and IO, the Class R-1 Certificates in respect of Components III). 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 R-1 Certificates in respect of Components
I and II, and with respect to REMIC III Regular Interests SB-IO, SB-PO and
IO, the Class R-1 Certificates in respect of Components III). The rights of
the Holders of each Class of Certificates (other than the Class R-1
Certificates in respect of Components I and II) to receive distributions from
the proceeds of REMIC III in respect of such Classes and the rights of the
Holders of the Class SB Certificates and the Class R-X Certificates to
receive distributions from the proceeds of REMIC IV 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 Interest 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, (i) all
Classes of Certificates (other than the Class SB and the Class R-1
Certificates in respect of Components I and II) in authorized denominations,
which, together with REMIC III Regular Interests SB-IO, SB-PO and IO,
evidence the beneficial interests in the entire REMIC III and (ii) the Class
SB and Class R-X Certificates which evidence the beneficial interests in the
entire REMIC IV.
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
Regulationss.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) (See Section 3.07(b) of the Standard Terms)
(c) (See Section 3.07(c) of the Standard Terms)
(d) (See Section 3.07(d) of the Standard Terms)
(e) [Reserved.]
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 Custodial Files.
(a) (See Section 3.15(a) of the Standard Terms)
(b) (See Section 3.15(b) of the Standard Terms)
(c) (See Section 3.15(c) of the Standard Terms)
Section 3.16. Servicing and Other Compensation; Compensating Interest.
(a) (See Section 3.16(a) of the Standard Terms)
(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, if any, shall be deposited into the
Certificate Account and shall be paid on each Distribution Date to the
holders of the Class SB Certificates in accordance with the Certificate
Principal Balance thereof.
(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 and (v) all other amounts constituting the Available
Distribution Amount for the immediately succeeding 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 Supplemental
Interest Trust 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
Certificateholders (other than the Class SB Certificateholders) on
account of the REMIC III Regular Interests represented thereby and to
REMIC IV on account of REMIC III Regular Interests SB-IO, SB-PO and IO in
the amounts and with the priorities set forth in the definition thereof.
(4) On each Distribution Date, the REMIC IV Distribution
Amount shall be deemed to have been distributed by REMIC IV to the Class
SB Certificateholders on account of the REMIC IV Regular Interests as set
forth in the definition thereof.
(5) On each Distribution Date, the amount, if any, deemed
received by the holders of the Class SB Certificates in respect of REMIC
IV Regular Interest IO and under the SB-AM Swap Agreement shall be deemed
to have been paid on behalf of the Class SB Certificates 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 Supplemental
Interest Trust Trustee on behalf of the Class SB Certificates. On each
Distribution Date, amounts paid to the Class A Certificates and Class 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 SB
Certificateholder pursuant to the SB-AM Swap Agreement.
(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 and the Supplemental
Interest Trust 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 order of priority, in each case to the extent of the Available
Distribution Amount on deposit in the Certificate Account and the
Supplemental Interest Trust Account pursuant to Section 4.09(c):
(i) The Interest Distribution Amount, sequentially:
(A) first, to the Class A Certificates, on a pro
rata basis, 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) second, to the Class 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;
(C) third, to the Class 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;
(D) fourth, to the Class 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;
(E) fifth, to the Class 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;
(F) sixth, to the Class 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;
(G) seventh, to the Class 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;
(ii) to the Class A Certificateholders and Class M Certificateholders from
the amount, if any, of Available Distribution Amount remaining
after the foregoing distributions, the Principal Distribution
Amount, which amount shall be allocated in the manner and
priority set forth in Section 4.02(d), until the aggregate
Certificate Principal Balance of each Class of Class A
Certificates and Class M Certificates has been reduced to zero;
(iii) to the Class A Certificateholders and Class 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 Mortgage 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 A Certificateholders and Class M
Certificateholders on a pro rata basis, based on the amount of
Prepayment Interest Shortfalls allocated thereto for such
Distribution Date;
(iv) to the Class A Certificateholders and Class 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 A Certificateholders and
Class M Certificateholders on a pro rata basis, based on the
amount of Prepayment Interest Shortfalls remaining unpaid;
(v) to the Class A Certificates and Class M Certificates, first from any
Yield Maintenance Certificates Payment and any Yield Maintenance
Reserve Fund Payment Amount, then from the amount, if any, of
Excess Cash Flow remaining after the foregoing distributions the
amount of any Basis Risk Shortfall on such Certificates and the
Yield Maintenance Reserve Fund Payment Amount on such
Distribution Date, which amount shall be allocated first, to the
Class A Certificates on a pro rata basis, based on their
respective Basis Risk Shortfall for such Distribution Date, and
then, sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class
M-4, Class M-5 and Class M-6 Certificateholders, in that order;
(vi) to pay the holders of the Class A Certificates and Class M
Certificates, on a pro rata basis, based on Relief Act Shortfalls
allocated thereto for such Distribution Date, the amount of any
Relief Act Shortfalls allocated thereto with respect to the
Mortgage Loans for such Distribution Date,
(vii) first, to the Class A-2 Certificateholders, the principal portion of
any Realized Losses previously allocated to those Certificates
and remaining unreimbursed, on a pro rata basis based on their
respective principal portion of any Realized Losses previously
allocated to those Certificates and remaining unreimbursed, and
then, sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class
M-4, Class M-5 and Class M-6 Certificateholders, in that order,
the principal portion of any Realized Losses previously allocated
to such Class and remaining unreimbursed;
(viii) to the Supplemental Interest Trust Account for payment to the
Swap Counterparty, any Swap Termination Payments due to a Swap
Counterparty Trigger Event;
(ix) to the Class SB Certificates in accordance with the Notional Amounts
thereof, (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 A Certificate and
Class M Certificate has been reduced to zero, the
Overcollateralization Amount, (B) from prepayment charges on
deposit in the Certificate Account, any prepayment charges
received on the Mortgage Loans during the related Prepayment
Period, and (C) 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
(x) to the Class R-1 Certificateholders in respect of Component III, 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)(v) shall, for federal income tax purposes, be
deemed to have been distributed from REMIC IV to the holders of the Class 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.
(d) The Principal Distribution Amount payable to the Class A
Certificateholders and Class M Certificateholders shall be distributed as
follows:
(i) first, the Class A Principal Distribution Amount shall be distributed
to the Class A 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;
(ii) second, the Class M-1 Principal Distribution Amount shall be
distributed to the Class M-1 Certificates until the Certificate
Principal Balance thereof has been reduced to zero;
(iii) third, the Class M-2 Principal Distribution Amount shall be distributed
to the Class M-2 Certificates until the Certificate Principal
Balance thereof has been reduced to zero;
(iv) fourth, the Class M-3 Principal Distribution Amount shall be
distributed to the Class M-3 Certificates until the Certificate
Principal Balance thereof has been reduced to zero;
(v) fifth, the Class M-4 Principal Distribution Amount shall be distributed
to the Class M-4 Certificates until the Certificate Principal
Balance thereof has been reduced to zero;
(vi) sixth, the Class M-5 Principal Distribution Amount shall be distributed
to the Class M-5 Certificates until the Certificate Principal
Balance thereof has been reduced to zero; and
(vii) seventh, the Class M-6 Principal Distribution Amount shall be
distributed to the Class M-6 Certificates until the Certificate
Principal Balance thereof has been reduced to zero.
(e) Notwithstanding the foregoing clauses (c) and (d), upon the reduction
of the Certificate Principal Balance of a Class of Class A Certificates or
Class 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)(iii) and (iv) and Basis Risk Shortfall
pursuant to clause (c)(v).
(f) 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.
(g) [Reserved].
(h) 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 non-interest bearing escrow
account for the benefit of such Certificateholders as provided in Section
9.01(d) of the Standard Terms.
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) (See Section 4.04(b) of the Standard Terms)
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. All Realized Losses on the
Mortgage Loans shall be allocated as follows:
first, to the Excess Cash Flow as part of the Principal Distribution
Amount as provided in Section 4.02(c), to the extent of the Excess Cash Flow
for such Distribution Date,
second, in reduction of the Overcollateralization Amount, until such
amount has been reduced to zero;
third, to the Class M-6 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero;
fourth, to the Class M-5 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero;
fifth, to the Class M-4 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero;
sixth, to the Class M-3 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero;
seventh, to the Class M-2 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero;
eighth, to the Class M-1 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero; and
ninth, to the Class A-2 Certificates, until the Certificate Principal
Balances thereof have been reduced to zero.
No losses shall be allocated to the Class A-1 Certificates.
(b) Any allocation of the principal portion of Realized Losses (other than
Debt Service Reductions) to the Class of Class A-2 Certificates or Class 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 Certificates below the aggregate Stated Principal Balance of
the Mortgage Loans. Allocations of the interest portions of Realized Losses
(other than any interest rate reduction resulting from a Servicing
Modification) to any Class of Class of Class A-2 Certificates or Class 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
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). 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.
(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 allocated to the Excess Cash Flow or the
Overcollateralization Amount pursuant to paragraphs (a), (b) or (c) of this
Section, the definition of Accrued Certificate Interest and the operation of
Section 4.02(c) shall be deemed allocated to the Class SB Certificates in
accordance with the Notional Amount thereof. Realized Losses allocated to
the Class SB Certificates shall, to the extent such Realized Losses represent
Realized Losses on an interest portion, be allocated to REMIC III Regular
Interest SB-IO. Realized Losses 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 SB-IO. Realized Losses 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 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 SB-IO.
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 Supplemental Interest Trust Trustee shall (i)
establish and maintain in its name, in trust for the benefit of the
Certificateholders, the Supplemental Interest Trust Account and (ii) for the
benefit of the Certificateholders, cause the Supplemental Interest Trust to
enter into the Swap Agreement.
(b) The Supplemental Interest Trust Trustee shall deposit in the
Supplemental Interest Trust 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 Supplemental Interest Trust to the
Swap Counterparty pursuant to the Swap Agreement shall be excluded from the
Available Distribution Amount and paid to the Swap Counterparty prior to any
distributions to the Certificateholders. On each Distribution Date, such
amounts will be remitted by the Supplemental Interest Trust Trustee to the
Supplemental Interest Trust 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 Supplemental
Interest Trust Account on each Distribution Date shall first be deemed paid
to the Supplemental Interest Trust Account in respect of REMIC IV Regular
Interest IO to the extent of the amount distributable on such REMIC IV
Regular Interest IO on such Distribution Date, and any remaining amount shall
be deemed paid to the Supplemental Interest Trust 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 A
Certificates and Class M Certificates and shall be paid as set forth under
Section 4.02.
(c) Net Swap Payments payable by the Swap Counterparty to the Supplemental
Interest Trust Trustee on behalf of the Trust Fund pursuant to the Swap
Agreement shall be deposited by the Supplemental Interest Trust Trustee into
the Supplemental Interest Trust Account and shall be applied in accordance
with Section 4.02.
(d) Subject to Sections 8.01 and 8.02 of the Standard Terms, the
Supplemental Interest Trust 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 Supplemental
Interest Trust Trustee does not receive such direction from such
Certificateholders, then at the written direction of Residential Funding.
(e) The Supplemental Interest Trust Account shall be an Eligible Account.
Amounts held in the Supplemental Interest Trust Account from time to time
shall continue to constitute assets of the Trust Fund, but not of the REMICs,
until released from the Supplemental Interest Trust Account pursuant to this
Section 4.09. The Supplemental Interest Trust 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 SB Certificateholders shall be
the owners of the Supplemental Interest Trust Account. The Supplemental
Interest Trust Trustee shall keep records that accurately reflect the funds
on deposit in the Supplemental Interest Trust Account. The Supplemental
Interest Trust Trustee shall, at the written direction of the Master
Servicer, invest amounts on deposit in the Supplemental Interest Trust
Account in Permitted Investments. In the absence of written direction to the
Supplemental Interest Trust Trustee from the Master Servicer, all funds in
the Supplemental Interest Trust Account shall remain uninvested.
(f) The Supplemental Interest Trust Trustee shall enter into the SB-AM Swap
Agreement on behalf of the holders of the Class A Certificates and Class M
Certificates on the one hand, and on behalf of the holders of the Class SB
Certificates on the other hand. Pursuant to the SB-AM Swap Agreement, all
holders of Certificates (other than the Class SB Certificates and Class R
Certificates) shall be treated as having agreed to pay, on each Distribution
Date, to the holder of the Class 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 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 SB and
Class 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 SB Certificates and
Class 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 Supplemental
Interest Trust Account pursuant to the SB-AM Swap Agreement. Thus, each
Certificate (other than the Class R Certificates) shall be treated as
representing not only ownership of regular interests in REMIC III or REMIC
IV, as applicable, 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 Supplemental
Interest Trust Trustee shall use reasonable efforts to appoint a successor
swap counterparty. To the extent that the Supplemental Interest Trust
Trustee receives a Swap Termination Payment from the Swap Counterparty, the
Supplemental Interest Trust 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 Supplemental Interest Trust Trustee of such Swap
Termination Payment, then the Supplemental Interest Trust 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 Supplemental
Interest Trust 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. Yield Maintenance Agreement; Yield Maintenance Reserve
Fund.
(a) On or before the Closing Date, the Trustee shall establish a separate
Yield Maintenance Reserve Fund on behalf of the Holders of the Class A and
Class M Certificates. The Yield Maintenance Reserve Fund must be an Eligible
Account. The Yield Maintenance Reserve Fund shall be entitled "Yield
Maintenance Reserve Fund, 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-QA9". The Trustee shall
enforce its rights under the Yield Maintenance Agreement. On each
Distribution Date from and including the Distribution Date in October 2011
to and including the Distribution Date in September 2013, the Trustee shall
deposit the Yield Maintenance Agreement Excess Amount, if any, into the Yield
Maintenance Reserve Fund. On each Distribution Date from and including the
Distribution Date in October 2011 to and including the Distribution Date in
September 2013, the Trustee shall withdraw from the Yield Maintenance Reserve
Fund the Yield Maintenance Reserve Fund Payment Amount for such Distribution
Date.
(b) Any amounts remaining in the Yield Maintenance Reserve Fund on the
Distribution Date in September 2013 after all payments to Certificateholders
have been made on such Distribution Date shall be released to the Underwriter
or its designee.
(c) On each Distribution Date, the related Yield Maintenance Certificates
Payment and the Yield Maintenance Reserve Fund Payment Amount will be
distributed by the Trustee, prior to the distribution of any Excess Cash Flow
with respect thereto, to the Holders of the Class A and Class M Certificates,
as applicable, as any Basis Risk Shortfalls on such Certificates, which
amount shall be allocated first, to the Class A Certificates on a pro rata
basis, based on their respective Basis Risk Shortfall for such Distribution
Date, and then, sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class
M-4, Class M-5 and Class M-6 Certificateholders.
(d) The Yield Maintenance Reserve Fund is an "outside reserve fund" within
the meaning of Treasury Regulationss.1.860G-2(h) and shall be an asset of the
Trust Fund but not an asset of any 2006-QA9 REMIC. The Trustee on behalf of
the Trust shall be the nominal owner of the Yield Maintenance Reserve Fund.
Credit Suisse Securities (USA) LLC shall be the beneficial owner of the Yield
Maintenance Reserve Fund, subject to the power of the Trustee to distribute
amounts under this Section 4.10. Amounts in the Yield Maintenance Reserve
Fund shall be held uninvested in a trust account of the Trustee with no
liability for interest or other compensation thereon.
(e) In the event that the Yield Maintenance Agreement, or any replacement
thereof, terminates prior to the Distribution Date in October 2013, the
Master Servicer, but at no expense to the Master Servicer, on behalf of the
Trustee, to the extent that the termination value under the Yield Maintenance
Agreement is sufficient therefor and only to the extent of the termination
payment received from the Yield Maintenance Agreement Provider, shall (i)
cause a new yield maintenance agreement provider to assume the obligations of
such terminated yield maintenance agreement provider or (ii) cause a new
yield maintenance agreement provider to enter into a new yield maintenance
agreement with the Trust Fund having substantially similar terms as those set
forth in the Yield Maintenance Agreement.
ARTICLE V
THE CERTIFICATES
Section 5.01. The Certificates. (See Section 5.01 of the Standard Terms)
Section 5.02. Registration of Transfer and Exchange of Certificates
(a) (See Section 5.02(a) of the Standard Terms)
(b) (See Section 5.02(b) of the Standard Terms)
(c) (See Section 5.02(c) of the Standard Terms)
(d) No transfer, sale, pledge or other disposition of a Class SB
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. Except with respect to (i) the
transfer of a Class SB Certificate by the Company to an Affiliate of the
Company or the transfer of a Class SB Certificate from the Company or an
Affiliate of the Company to an owner trust or other entity established by the
Company (including to the Tustee, as a NIM Trustee), or (ii) a transfer of a
Class SB Certificate from the NIM Trustee to the Company or an Affiliate of
the Company, in the event that a transfer of a Class SB 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, or is not a "U.S
person" within the meaning of Regulation S under the Securities Act of 1933
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. Any transferee of an interest in a Rule 144A
Global Offered Certificate from a holder of an interest in a Rule 144A Global
Offered Certificate will be deemed to have represented and warranted as to
the matters set forth in Exhibit I attached to the Standard Terms. 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) In the case of any Class SB or Class R 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 SB or Class R 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 (with respect to any
Class SB Certificate) or paragraph fifteen of Exhibit G-1 (with respect to
any 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 either (a) is not an
employee benefit plan or other plan subject to the prohibited transaction
provisions of ERISA or Section 4975 of the Code, or any Person (including 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") or (b) in the case of any Class SB 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").
(ii) Any Transferee of a Class M Certificate (or interest therein)
acquired after termination of the Swap Agreement 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, as most recently amended, 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.
(iii) (A) If any Class 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 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.
(iv) Each Holder of a Certificate or any interest therein acquired as
of any date prior to the termination of the Swap Agreement that is a Plan
Investor shall be deemed to have represented, by its acquisition or holding
of such Certificate or any interest therein, that at least one of PTCE 84-14,
90-1, 91-38, 95-60 or 96-23 or other applicable exemption applies to such
Holder's right to receive payments from the Supplemental Interest Trust.
(f) (See Section 5.02(f) of the Standard Terms)
(g) [Reserved]
(ii) [Reserved]
(iii) [Reserved]
(iv) [Reserved]
(v) [Reserved]
(vi) [Reserved]
(vii) [Reserved]
(viii) [Reserved]
(ix) The Holder of a Class SB Certificate desiring to effect any 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 the provisions
of this Agreement.
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.
The Trustee and Supplemental Interest Trust Trustee may appoint a
Paying Agent for the purpose of making distributions to the
Certificateholders pursuant to Section 4.02. In the event of any such
appointment, on or prior to each Distribution Date the Master Servicer on
behalf of the Trustee or Supplemental Interest Trust Trustee, as applicable,
shall deposit or cause to be deposited with the Paying Agent a sum sufficient
to make the payments to the Certificateholders in the amounts and in the
manner provided for in Section 4.02, such sum to be held in trust for the
benefit of the Certificateholders.
The Trustee or Supplemental Interest Trust Trustee, as
applicable, shall cause each Paying Agent to execute and deliver to the
Trustee or Supplemental Interest Trust Trustee, as applicable, an instrument
in which such Paying Agent shall agree with the Trustee or Supplemental
Interest Trust Trustee, as applicable, that such Paying Agent shall hold all
sums held by it for the payment to the Certificateholders in trust for the
benefit of the Certificateholders entitled thereto until such sums shall be
distributed to such Certificateholders. Any sums so held by such Paying
Agent shall be held only in Eligible Accounts to the extent such sums are not
distributed to the Certificateholders on the date of receipt by such Paying
Agent.
Section 5.06. U.S.A. Patriot Act Compliance. (See Section 5.05 of the
Standard Terms)
ARTICLE VI
THE COMPANY AND THE MASTER SERVICER
(See Article VI of the Standard Terms.)
ARTICLE VII
DEFAULT
(See Article VII of the Standard Terms.)
ARTICLE VIII
CONCERNING THE TRUSTEE AND SUPPLEMENTAL INTEREST TRUST TRUSTEE
Section 8.01. Duties of the Trustee and Supplemental Interest Trust
Trustee.
(a) The Trustee and Supplemental Interest Trust Trustee, prior to the
occurrence of an Event of Default and after the curing or waiver of all
Events of Default which may have occurred, undertake to perform such duties
and only such duties as are specifically set forth in this Agreement. In
case an Event of Default has occurred (which has not been cured or waived),
the Trustee and Supplemental Interest Trust Trustee shall exercise such of
the rights and powers vested in each by this Agreement, and use the same
degree of care and skill in their exercise as a prudent investor would
exercise or use under the circumstances in the conduct of such investor's own
affairs.
(b) The Trustee or Supplemental Interest Trust Trustee, as applicable, upon
receipt of all resolutions, certificates, statements, opinions, reports,
documents, orders or other instruments furnished to the Trustee or
Supplemental Interest Trust Trustee which are specifically required to be
furnished pursuant to any provision of this Agreement, shall examine them to
determine whether they conform to the requirements of this Agreement. The
Trustee or Supplemental Interest Trust Trustee, as applicable, shall notify
the Certificateholders of any such documents which do not materially conform
to the requirements of this Agreement in the event that the Trustee or
Supplemental Interest Trust Trustee, as applicable, after so requesting, does
not receive satisfactorily corrected documents.
The Trustee shall forward or cause to be forwarded in a timely fashion
the notices, reports and statements required to be forwarded by the Trustee
pursuant to Sections 4.03, 4.06, 7.03 and 10.01. The Trustee and
Supplemental Interest Trust Trustee shall furnish in a timely fashion to the
Master Servicer such information as the Master Servicer may reasonably
request from time to time for the Master Servicer to fulfill its duties as
set forth in this Agreement. The Trustee and Supplemental Interest Trust
Trustee covenant and agree that each shall perform its respective obligations
hereunder in a manner so as to maintain the status of any portion of any
REMIC formed under the Series Supplement as a REMIC under the REMIC
Provisions and (subject to Section 10.01(f)) to prevent the imposition of any
federal, state or local income, prohibited transaction, contribution or other
tax on the Trust Fund or Supplemental Interest Trust to the extent that
maintaining such status and avoiding such taxes are reasonably within the
control of the Trustee or Supplemental Interest Trust Trustee and are
reasonably within the scope of their respective duties under this Agreement.
(c) No provision of this Agreement shall be construed to relieve the
Trustee or Supplemental Trust Trustee, as applicable, from liability for its
own negligent action, its own negligent failure to act or its own willful
misconduct; provided, however, that:
(i) Prior to the occurrence of an Event of Default, and after the curing or
waiver of all such Events of Default which may have occurred, the
duties and obligations of the Trustee and Supplemental Interest Trust
Trustee, as applicable, shall be determined solely by the express
provisions of this Agreement, the Trustee or Supplemental Interest
Trust Trustee shall not be liable except for the performance of such
duties and obligations as are specifically set forth in this Agreement,
no implied covenants or obligations shall be read into this Agreement
against the Trustee or Supplemental Interest Trust Trustee, and, in the
absence of bad faith on the part of the Trustee or Supplemental
Interest Trust Trustee, the Trustee or Supplemental Interest Trust
Trustee may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Trustee or Supplemental
Interest Trust Trustee, as applicable, by the Company or the Master
Servicer and which on their face, do not contradict the requirements of
this Agreement;
(ii) The Trustee or Supplemental Interest Trust Trustee shall not be
personally liable for an error of judgment made in good faith by a
Responsible Officer or Responsible Officers of the Trustee or
Supplemental Interest Trust Trustee, as applicable, unless it shall be
proved that the Trustee or Supplemental Interest Trust Trustee, as
applicable, was negligent in ascertaining the pertinent facts;
(iii) The Trustee shall not be personally liable with respect to any action
taken, suffered or omitted to be taken by it in good faith in
accordance with the direction of Certificateholders of any Class
holding Certificates which evidence, as to such Class, Percentage
Interests aggregating not less than 25% as to the time, method and
place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred upon the Trustee,
under this Agreement;
(iv) The Trustee shall not be charged with knowledge of any default (other
than a default in payment to the Trustee) specified in clauses (i) and
(ii) of Section 7.01 or an Event of Default under clauses (iii), (iv)
and (v) of Section 7.01 unless a Responsible Officer of the Trustee
assigned to and working in the Corporate Trust Office obtains actual
knowledge of such failure or event or the Trustee receives written
notice of such failure or event at its Corporate Trust Office from the
Master Servicer, the Company or any Certificateholder; and
(v) Except to the extent provided in Section 7.02, no provision in this
Agreement shall require the Trustee or Supplemental Interest Trust
Trustee, as applicable, to expend or risk its own funds (including,
without limitation, the making of any Advance) or otherwise incur any
personal financial liability in the performance of any of its duties as
Trustee or Supplemental Interest Trust Trustee, as applicable,
hereunder, or in the exercise of any of its rights or powers, if the
Trustee or Supplemental Interest Trust Trustee, as applicable, shall
have reasonable grounds for believing that repayment of funds or
adequate indemnity against such risk or liability is not reasonably
assured to it.
(d) The Trustee shall timely pay, from its own funds, the amount of any and
all federal, state and local taxes imposed on the Trust Fund or its assets or
transactions including, without limitation, (A) "prohibited transaction"
penalty taxes as defined in Section 860F of the Code, if, when and as the
same shall be due and payable, (B) any tax on contributions to a REMIC after
the Closing Date imposed by Section 860G(d) of the Code and (C) any tax on
"net income from foreclosure property" as defined in Section 860G(c) of the
Code, but only if such taxes arise out of a breach by the Trustee of its
obligations hereunder, which breach constitutes negligence or willful
misconduct of the Trustee.
Section 8.02. Certain Matters Affecting the Trustee and Supplemental
Interest Trust Trustee.
(a) Except as otherwise provided in Section 8.01:
(i) The Trustee or Supplemental Interest Trust Trustee, as applicable, may
rely and shall be protected in acting or refraining from acting upon
any resolution, Officers' Certificate, certificate of auditors or any
other certificate, statement, instrument, opinion, report, notice,
request, consent, order, appraisal, bond or other paper or document
believed by it to be genuine and to have been signed or presented by
the proper party or parties;
(ii) The Trustee or Supplemental Interest Trust Trustee, as applicable, may
consult with counsel and any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken or
suffered or omitted by it hereunder in good faith and in accordance
with such Opinion of Counsel;
(iii) The Trustee or Supplemental Interest Trust Trustee, as applicable,
shall be under no obligation to exercise any of the trusts or powers
vested in it by this Agreement or to institute, conduct or defend any
litigation hereunder or in relation hereto at the request, order or
direction of any of the Certificateholders, pursuant to the provisions
of this Agreement, unless such Certificateholders shall have offered to
the Trustee or Supplemental Interest Trust Trustee, as applicable,
reasonable security or indemnity against the costs, expenses and
liabilities which may be incurred therein or thereby; nothing contained
herein shall, however, relieve the Trustee of the obligation, upon the
occurrence of an Event of Default (which has not been cured or waived),
to exercise such of the rights and powers vested in it by this
Agreement, and to use the same degree of care and skill in their
exercise as a prudent investor would exercise or use under the
circumstances in the conduct of such investor's own affairs;
(iv) The Trustee or Supplemental Interest Trust Trustee, as applicable,
shall not be personally liable for any action taken, suffered or
omitted by it in good faith and believed by it to be authorized or
within the discretion or rights or powers conferred upon it by this
Agreement;
(v) Prior to the occurrence of an Event of Default hereunder and after the
curing or waiver of all Events of Default which may have occurred, the
Trustee shall not be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond or
other paper or document, unless requested in writing so to do by
Holders of Certificates of any Class evidencing, as to such Class,
Percentage Interests, aggregating not less than 50%; provided, however,
that if the payment within a reasonable time to the Trustee of the
costs, expenses or liabilities likely to be incurred by it in the
making of such investigation is, in the opinion of the Trustee, not
reasonably assured to the Trustee by the security afforded to it by the
terms of this Agreement, the Trustee may require reasonable indemnity
against such expense or liability as a condition to so proceeding. The
reasonable expense of every such examination shall be paid by the
Master Servicer, if an Event of Default shall have occurred and is
continuing, and otherwise by the Certificateholder requesting the
investigation;
(vi) The Trustee or Supplemental Interest Trust Trustee, as applicable, may
execute any of the trusts or powers hereunder or perform any duties
hereunder either directly or by or through agents or attorneys; and
(vii) To the extent authorized under the Code and the regulations promulgated
thereunder, each Holder of a Class R Certificate hereby irrevocably
appoints and authorizes the Trustee to be its attorney-in-fact for
purposes of signing any Tax Returns required to be filed on behalf of
the Trust Fund. The Trustee shall sign on behalf of the Trust Fund and
deliver to the Master Servicer in a timely manner any Tax Returns
prepared by or on behalf of the Master Servicer that the Trustee is
required to sign as determined by the Master Servicer pursuant to
applicable federal, state or local tax laws, provided that the Master
Servicer shall indemnify the Trustee for signing any such Tax Returns
that contain errors or omissions.
(b) Following the issuance of the Certificates, the Trustee shall not
accept any contribution of assets to the Trust Fund unless (subject to
Section 10.01(f)) it shall have obtained or been furnished with an Opinion of
Counsel to the effect that such contribution will not (i) cause any portion
of any REMIC formed under the Series Supplement to fail to qualify as a REMIC
at any time that any Certificates are outstanding or (ii) cause the Trust
Fund to be subject to any federal tax as a result of such contribution
(including the imposition of any federal tax on "prohibited transactions"
imposed under Section 860F(a) of the Code).
Section 8.03. Trustee and Supplemental Interest Trust Trustee Not Liable
for Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates (other than the
execution of the Certificates and relating to the acceptance and receipt of
the Mortgage Loans) shall be taken as the statements of the Company or the
Master Servicer as the case may be, and the Trustee and Supplemental Interest
Trust Trustee assume no responsibility for their correctness. The Trustee
and Supplemental Interest Trust Trustee make no representations as to the
validity or sufficiency of this Agreement or of the Certificates (except that
the Certificates shall be duly and validly executed and authenticated by it
as Certificate Registrar) or of any Mortgage Loan or related document, or of
MERS or the MERS(R)System. Except as otherwise provided herein, the Trustee
and Supplemental Interest Trust Trustee shall not be accountable for the use
or application by the Company or the Master Servicer of any of the
Certificates or of the proceeds of such Certificates, or for the use or
application of any funds paid to the Company or the Master Servicer in
respect of the Mortgage Loans or deposited in or withdrawn from the Custodial
Account or the Certificate Account by the Company or the Master Servicer.
Section 8.04. Trustee and Supplemental Interest Trust Trustee May Own
Certificates.
The Trustee and Supplemental Interest Trust Trustee, in their
individual or any other capacity may become the owner or pledgee of
Certificates with the same rights it would have if it were not Trustee.
Section 8.05. Master Servicer to Pay Trustee's and Supplemental Interest
Trust Trustee's Fees and Expenses; Indemnification.
(a) The Master Servicer covenants and agrees to pay to the
Trustee, any co-trustee and the Supplemental Interest Trust Trustee from time
to time, and the Trustee, any co-trustee and the Supplemental Interest Trust
Trustee shall be entitled to, reasonable compensation (which shall not be
limited by any provision of law in regard to the compensation of a trustee of
an express trust) for all services rendered by each of them in the execution
of the trusts hereby created and in the exercise and performance of any of
the powers and duties hereunder of the Trustee, any co-trustee and the
Supplemental Interest Trust Trustee, and the Master Servicer will pay or
reimburse the Trustee, any co-trustee and the Supplemental Interest Trust
Trustee upon request for all reasonable expenses, disbursements and advances
incurred or made by the Trustee, any co-trustee or the Supplemental Interest
Trust Trustee in accordance with any of the provisions of this Agreement
(including the reasonable compensation and the expenses and disbursements of
its counsel and of all persons not regularly in its employ, and the expenses
incurred by the Trustee, any co-trustee or the Supplemental Interest Trust
Trustee in connection with the appointment of an office or agency pursuant to
Section 8.12) except any such expense, disbursement or advance as may arise
from its negligence or bad faith.
(b) The Master Servicer agrees to indemnify the Trustee or
Supplemental Interest Trust Trustee, as applicable, for, and to hold the
Trustee or Supplemental Interest Trust Trustee, as applicable, harmless
against, any loss, liability or expense incurred without negligence or
willful misconduct on the Trustee's or Supplemental Interest Trust Trustee's,
as applicable, part, arising out of, or in connection with, the acceptance
and administration of the Trust Fund or Supplemental Interest Trust, as
applicable, 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 their respective powers or duties under
this Agreement, the Swap Agreement, the Yield Maintenance 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 or Supplemental Interest Trust Trustee, as applicable, 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 or Supplemental Interest Trust
Trustee, as applicable, including the costs and expenses of defending itself
against any claim, incurred in connection with any actions taken by the
Trustee or Supplemental Interest Trust Trustee, as applicable, 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.
The Trustee hereunder shall at all times be a corporation or a national
banking association having its principal office in a state and city
acceptable to the Company and organized and doing business under the laws of
such state or the United States of America, authorized under such laws to
exercise corporate trust powers, having a combined capital and surplus of at
least $50,000,000 and subject to supervision or examination by federal or
state authority. If such corporation or national banking association
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for
the purposes of this Section the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set
forth in its most recent report of condition so published. In case at any
time the Trustee shall cease to be eligible in accordance with the provisions
of this Section, the Trustee shall resign immediately in the manner and with
the effect specified in Section 8.07.
The Trustee and Supplemental Interest Trust Trustee, and any successors
thereto, shall at all times be the same Person.
Section 8.07. Resignation and Removal of the Trustee and Supplemental
Interest Trust Trustee.
(a) The Trustee and Supplemental Interest Trust Trustee, together, may at
any time resign and be discharged from the trusts hereby created by giving
written notice thereof to the Company. Upon receiving such notice of
resignation, the Company shall promptly appoint a successor trustee and
successor supplemental interest trust trustee by written instrument, in
duplicate, one copy of which instrument shall be delivered to the resigning
Trustee and one copy to the successor trustee. If no successor trustee and
successor supplemental interest trust trustee shall have been so appointed
and have accepted appointment within 30 days after the giving of such notice
of resignation, the resigning Trustee and Supplemental Interest Trust Trustee
may petition any court of competent jurisdiction for the appointment of a
successor trustee and successor supplemental interest trust trustee.
(b) If at any time the Trustee shall cease to be eligible in accordance
with the provisions of Section 8.06 and shall fail to resign after written
request therefor by the Company, or if at any time the Trustee shall become
incapable of acting, or shall be adjudged bankrupt or insolvent, or a
receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, then
the Company may remove the Trustee and Supplemental Interest Trust Trustee
and appoint a successor trustee by written instrument, in duplicate, one copy
of which instrument shall be delivered to the Trustee so removed and one copy
to the successor trustee. In addition, in the event that the Company
determines that the Trustee or Supplemental Interest Trust Trustee has failed
(i) to distribute or cause to be distributed to the Certificateholders any
amount required to be distributed hereunder, if such amount is held by the
Trustee or its Paying Agent (other than the Master Servicer or the Company)
or the Supplemental Interest Trust Trustee for distribution or (ii) to
otherwise observe or perform in any material respect any of its covenants,
agreements or obligations hereunder, and such failure shall continue
unremedied for a period of 5 days (in respect of clause (i) above) or 30 days
(in respect of clause (ii) above other than any failure to comply with the
provisions of Article XII, in which case no notice or grace period shall be
applicable) after the date on which written notice of such failure, requiring
that the same be remedied, shall have been given to the Trustee by the
Company, then the Company may remove the Trustee and Supplemental Interest
Trust Trustee and appoint a successor trustee and successor supplemental
interest trust trustee by written instrument delivered as provided in the
preceding sentence. In connection with the appointment of a successor
trustee and successor supplemental interest trust trustee pursuant to the
preceding sentence, the Company shall, on or before the date on which any
such appointment becomes effective, obtain from each Rating Agency written
confirmation that the appointment of any such successor trustee and successor
supplemental interest trust trustee will not result in the reduction of the
ratings on any Class of the Certificates below the lesser of the then current
or original ratings on such Certificates.
(c) The Holders of Certificates entitled to at least 51% of the Voting
Rights may at any time remove the Trustee and Supplemental Interest Trust
Trustee, together, and appoint a successor trustee and successor supplemental
interest trust trustee by written instrument or instruments, in triplicate,
signed by such Holders or their attorneys-in-fact duly authorized, one
complete set of which instruments shall be delivered to the Company, one
complete set to the Trustee and Supplemental Interest Trust Trustee so
removed and one complete set to the successors so appointed.
(d) Any resignation or removal of the Trustee and Supplemental Interest
Trust Trustee and appointment of a successor trustee and successor
supplemental interest trust trustee pursuant to any of the provisions of this
Section shall become effective upon acceptance of appointment by the
successor trustee and successor supplemental interest trust trustee as
provided in Section 8.08.
Section 8.08. Successor Trustee and Successor Supplemental Interest Trust
Trustee.
(a) Any successor trustee and successor supplemental interest trust trustee
appointed as provided in Section 8.07 shall execute, acknowledge and deliver
to the Company and to its predecessor trustee or predecessor supplemental
interest trust trustee, as applicable, an instrument accepting such
appointment hereunder, and thereupon the resignation or removal of the
predecessor trustee and predecessor supplemental interest trust trustee shall
become effective and such successor trustee and successor supplemental
interest trust trustee shall become effective and such successor trustee and
successor supplemental interest trust trustee without any further act, deed
or conveyance, shall become fully vested with all the rights, powers, duties
and obligations of its predecessor hereunder, with the like effect as if
originally named as trustee or supplemental interest trust trustee herein.
The predecessor trustee and predecessor supplemental interest trust trustee
shall deliver to the successor trustee and successor supplemental interest
trust trustee, as applicable, all Custodial Files and related documents and
statements held by it hereunder (other than any Custodial Files at the time
held by a Custodian, which shall become the agent of any successor trustee
hereunder), and the Company, the Master Servicer, predecessor trustee and
predecessor supplemental interest trust trustee shall execute and deliver
such instruments and do such other things as may reasonably be required for
more fully and certainly vesting and confirming in the successor trustee and
successor supplemental interest trust trustee all such rights, powers, duties
and obligations.
(b) No successor trustee or successor supplemental interest trust trustee
shall accept appointment as provided in this Section unless at the time of
such acceptance (i) such successor trustee shall be eligible under the
provisions of Section 8.06, and (ii) such successor trustee and successor
supplemental interest trust trustee shall be the same Person.
(c) Upon acceptance of appointment by a successor trustee or successor
supplemental interest trust trustee as provided in this Section, the Company
shall mail notice of the succession of such trustee and supplemental interest
trust trustee hereunder to all Holders of Certificates at their addresses as
shown in the Certificate Register. If the Company fails to mail such notice
within 10 days after acceptance of appointment by the successor trustee and
successor supplemental interest trust trustee, the successor trustee shall
cause such notice to be mailed at the expense of the Company.
Section 8.09. Merger or Consolidation of Trustee.
Any corporation or national banking association into which the Trustee
and Supplemental Interest Trust Trustee may be merged or converted or with
which it may be consolidated or any corporation or national banking
association resulting from any merger, conversion or consolidation to which
the Trustee and Supplemental Interest Trust Trustee shall be a party, or any
corporation or national banking association succeeding to the business of the
Trustee and Supplemental Interest Trust Trustee, shall be the successor of
the Trustee and Supplemental Interest Trust Trustee, as applicable,
hereunder, provided such corporation or national banking association shall be
eligible under the provisions of Section 8.06, without the execution or
filing of any paper or any further act on the part of any of the parties
hereto, anything herein to the contrary notwithstanding. The Trustee shall
mail notice of any such merger or consolidation to the Certificateholders at
their address as shown in the Certificate Register.
Section 8.10. Appointment of Co-Trustee or Separate Trustee. (See
Section 8.10 of the Standard Terms).
Section 8.11. Appointment of Custodians.
The Trustee may, with the consent of the Master Servicer and the
Company, or shall, at the direction of the Company and the Master Servicer,
appoint custodians who are not Affiliates of the Company, the Master Servicer
or any Seller to hold all or a portion of the Custodial Files as agent for
the Trustee, by entering into a Custodial Agreement. Subject to Article
VIII, the Trustee agrees to comply with the terms of each Custodial Agreement
with respect to the Custodial Files and to enforce the terms and provisions
thereof against the related custodian for the benefit of the
Certificateholders. Each custodian shall be a depository institution subject
to supervision by federal or state authority, shall have a combined capital
and surplus of at least $15,000,000 and shall be qualified to do business in
the jurisdiction in which it holds any Custodial File. Each Custodial
Agreement, with respect to the Custodial Files, may be amended only as
provided in Section 11.01. The Trustee shall notify the Certificateholders
of the appointment of any custodian (other than the custodian appointed as of
the Closing Date) pursuant to this Section 8.11.
Section 8.12. Appointment of Office or Agency. (See Section 8.12 of the
Standard Terms).
Section 8.13. Swap Agreement.
The Supplemental Interest Trust Trustee is hereby authorized and
directed to, and agrees that it shall (a) enter into the Swap Agreement on
behalf of the Supplemental Interest Trust and (b) enter into the SB-AM Swap
Agreement on behalf of (i) the Class A Certificateholders and Class M
Certificateholders on the one hand, and (ii) the Class SB Certificateholders
on the other hand.
Section 8.14. Yield Maintenance Agreement.
The Trustee is hereby authorized and directed to, and agrees that
it shall, enter into the Yield Maintenance 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, the purchase of all Mortgage
Loans and all property acquired in respect of any Mortgage Loan
remaining in the Trust Fund, at a price equal to the sum of (A) 100% of
the unpaid principal balance of each Mortgage Loan (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))); 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 pursuant to clause (ii) above is conditioned upon the Pool Stated
Principal Balance 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.
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 Custodial Files pertaining to the Mortgage Loans being
purchased.
In addition to the foregoing, on any Distribution Date on which the
Pool Stated Principal Balance, 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, the Master Servicer shall have the
right, at its option, to purchase the Class A Certificates, Class M
Certificates and Class SB 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 Class A Certificates, Class M Certificates and
Class SB 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, the Supplemental
Interest Trust Trustee and the Swap Counterparty (so long as the Swap
Agreement has not previously been terminated) 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) In the case of the Senior Certificates, upon presentation and surrender
of the Certificates by the Certificateholders thereof, and in the case of the
Class M Certificates and Class SB 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 the
Certificates, and otherwise in accordance with Section 4.01(a), the Trustee
and the Supplemental Interest Trust Trustee, as applicable, 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 Mortgage Loans or
the outstanding Class A Certificates, Class M Certificates and Class SB
Certificates, an amount equal to the price paid pursuant to Section 9.01(a)
as follows: (A) with respect to each Class A Certificate and Class M
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 A
Certificates and Class 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 SB Certificates, all remaining amounts on a pro rata basis
in accordance with the respective Notional Amounts thereof. 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.
(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 Mortgage Loans but excluding the Supplemental Interest Trust
Account, the Swap Agreement and the SB-AM Swap Agreement), 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
consisting of REMIC III Regular Interests SB-PO, SB-IO and IO as a REMIC
(REMIC IV) for federal income tax purposes.
The REMIC I Regular Interests will be "regular interests" in REMIC I
and Component I of the Class R-1 Certificates will be the sole class of
"residual interests" in REMIC I for purposes of the REMIC Provisions under
the federal income tax law.
The REMIC II Regular Interests will be "regular interests" in REMIC II
and Component II of the Class R-1 Certificates will be the sole class of
"residual interests" in REMIC II for purposes of the REMIC Provisions under
the federal income tax law.
The REMIC III Regular Interests will be the "regular interests" in
REMIC III, ownership of which, except in the case of REMIC III Regular
Interests SB-IO, SB-PO and IO, will be represented by the Class A
Certificates, Class M-1 Certificates, Class M-2 Certificates, Class M-3
Certificates, Class M-4 Certificates, Class M-5 Certificates and Class M-6
Certificates, and Component III of the Class R-1 Certificates will represent
the sole class of "residual interests" in REMIC III for purposes of the REMIC
Provisions 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 SB Certificates, and
the Class R-X Certificates will represent the sole class of "residual
interests" in REMIC IV for purposes of the REMIC Provisions under federal
income tax law.
Section 10.04. Distributions on the Uncertificated REMIC Regular
Interests. (See Section 4.02(c) 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 4.02(c)(viii), 4.09, 9.01
and 11.01 of this Agreement shall require the consent of the Swap
Counterparty as a third-party beneficiary of such sections.
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 0000 Xxxxxxxxxx Xxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Master Servicer 0000 X. Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Managing Director/Master Servicing
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Trustee Corporate Trust Xxxxxx
0000 Xxxx Xx. Xxxxxx Xxxxx
Xxxxx Xxx, Xxxxxxxxxx 00000-0000,
Attention: Residential Accredit Loans, Inc.
Series 2006-QA9
The Trustee designates its offices located at DB
Services Tennessee, 000 Xxxxxxxxx Xxxx Xxxx,
Xxxxxxxxx, XX 00000-0000, Attn: Transfer Unit,
for the purposes of Section 8.12 of the Standard
Terms
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Xxxxx'x Investors Service, 00 Xxxxxx Xxxxxx, 0xx Xxxxx
Inc. Xxx Xxxx, Xxx Xxxx 00000
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Standard & Poor's Ratings 00 Xxxxx Xxxxxx
Services, a division of The 41st Floor
XxXxxx-Xxxx Companies, Inc. Xxx Xxxx, Xxx Xxxx 00000
---------------------------------------------------------------------------------
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 SB
Certificates; 0.25% of all Voting Rights shall be allocated among the Holders
of the Class R-1 Certificates in respect of Component I, in accordance with
their respective Percentage Interests; 0.25% of all Voting Rights shall be
allocated among the Holders of the Class R-1 Certificates in respect of
Component II, in accordance with their respective Percentage Interests; 0.25%
of all Voting Rights shall be allocated among the Holders of the Class R-1
Certificates in respect of Component III, in accordance with their respective
Percentage Interests; and 0.25% of all Voting Rights shall be allocated among
the Holders of the Class R-X Certificates, in accordance with their
respective Percentage Interests.
Section 11.10. No Petition.
The Company, 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)
OHS West:260109767.6
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:
Name: Xxxxxxxxxxx Xxxxxxxx
Title: Vice President
Attest:
Name: Xxxxxxx Xxxxxxxx
Title: Vice President
RESIDENTIAL FUNDING COMPANY, LLC
[Seal]
By:
Name: Xxxxxxx Xxxxxxxx
Title: Associate
Attest:
Name: Xxxxxxxxxxx Xxxxxxxx
Title: Associate
DEUTSCHE BANK TRUST COMPANY AMERICAS,
[Seal] as Trustee
By:
Name: Xxx Xxxxxxxx
Title: Authorized Signer
By:
Name: Xxxxxxx Xxxxxxxxx
Title: Authorized Signer
Attest:
Name: Xxxxxxx Xxxxxx
Title: Vice President
STATE OF MINNESOTA )
) ss.:
COUNTY OF HENNEPIN )
On the 30th day of October, 2006 before me, a notary public in and for
said State, personally appeared Xxxxxxxxxxx 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 30th day of October, 2006 before me, a notary public in and for
said State, personally appeared Xxxxxxx Xxxxxxxx known to me to be a(n)
Associate of RESIDENTIAL FUNDING COMPANY, LLC, one of the companies that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said company, and acknowledged to me that such
company 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 30th day of October, 2006 before me, a notary public in and for
said State, personally appeared Xxx Xxxxxxxx known to me to be a(n)
Authorized Signer 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 30th day of October, 2006 before me, a notary public in and for
said State, personally appeared Xxxxxxx Xxxxxxxxx known to me to be a(n)
Authorized Signer 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 ONE
MORTGAGE LOAN SCHEDULE
(On file with RFC)
EXHIBIT TWO
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
A, Class M and Class 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 THREE
STANDARD TERMS OF POOLING AND SERVICING
AGREEMENT DATED AS OF OCTOBER 30, 2006
==============================================================================
STANDARD TERMS OF
POOLING AND SERVICING AGREEMENT
Dated as of October 30, 2006
Residential Accredit Loans, Inc.
Mortgage Asset-Backed Pass-Through Certificates
==============================================================================
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS...................................................2
Section 1.01. Definitions.............................................2
Section 1.02. Use of Words and Phrases...............................35
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; ORIGINAL ISSUANCE OF
CERTIFICATES.................................................36
Section 2.01. Conveyance of Mortgage Loans...........................36
Section 2.02. Acceptance by Trustee..................................43
Section 2.03. Representations, Warranties and Covenants of the
Master Servicer and the Company........................44
Section 2.04. Representations and Warranties of Residential
Funding................................................45
Section 2.05. Execution and Authentication of
Certificates/Issuance of Certificates Evidencing
Interests in REMIC I Certificates......................47
Section 2.06. Conveyance of Uncertificated REMIC I and REMIC II
Regular Interests; Acceptance by the Trustee...........47
Section 2.07. Issuance of Certificates Evidencing Interests in
REMIC II...............................................47
Section 2.08. Purposes and Powers of the Trust.......................48
ARTICLE III ADMINISTRATION AND SERVICING OF MORTGAGE LOANS...............48
Section 3.01. Master Servicer to Act as Servicer.....................48
Section 3.02. Subservicing Agreements Between Master Servicer
and Subservicers; Enforcement of Subservicers' and
Sellers' Obligations...................................50
Section 3.03. Successor Subservicers.................................51
Section 3.04. Liability of the Master Servicer.......................51
Section 3.05. No Contractual Relationship Between Subservicer
and Trustee or Certificateholders......................51
Section 3.06. Assumption or Termination of Subservicing
Agreements by Trustee..................................52
Section 3.07. Collection of Certain Mortgage Loan Payments;
Deposits to Custodial Account..........................52
Section 3.08. Subservicing Accounts; Servicing Accounts..............55
Section 3.09. Access to Certain Documentation and Information
Regarding the Mortgage Loans...........................56
Section 3.10. Permitted Withdrawals from the Custodial Account.......57
Section 3.11. Maintenance of the Primary Insurance Policies;
Collections Thereunder.................................59
Section 3.12. Maintenance of Fire Insurance and Omissions and
Fidelity Coverage......................................59
Section 3.13. Enforcement of Due-on-Sale Clauses; Assumption
and Modification Agreements; Certain Assignments......61
Section 3.14. Realization Upon Defaulted Mortgage Loans..............63
Section 3.15. Trustee to Cooperate; Release of Custodial Files.......66
Section 3.16. Servicing and Other Compensation; Compensating
Interest...............................................68
Section 3.17. Reports to the Trustee and the Company.................69
Section 3.18. Annual Statement as to Compliance and Servicing
Assessment.............................................69
Section 3.19. Annual Independent Public Accountants' Servicing
Report.................................................69
Section 3.20. Rights of the Company in Respect of the Master
Servicer...............................................70
Section 3.21. Administration of Buydown Funds........................70
Section 3.22. Advance Facility.......................................71
ARTICLE IV PAYMENTS TO CERTIFICATEHOLDERS...............................75
Section 4.01. Certificate Account....................................75
Section 4.02. Distributions. ....................................75
Section 4.03. Statements to Certificateholders; Statements to
Rating Agencies; Exchange Act Reporting................75
Section 4.04. Distribution of Reports to the Trustee and the
Company; Advances by the Master Servicer...............78
Section 4.05. Allocation of Realized Losses..........................79
Section 4.06. Reports of Foreclosures and Abandonment of
Mortgaged Property.....................................79
Section 4.07. Optional Purchase of Defaulted Mortgage Loans..........79
Section 4.08. Surety Bond............................................80
ARTICLE V THE CERTIFICATES.............................................81
Section 5.01. The Certificates.......................................81
Section 5.02. Registration of Transfer and Exchange of
Certificates...........................................83
Section 5.03. Mutilated, Destroyed, Lost or Stolen Certificates......89
Section 5.04. Persons Deemed Owners..................................89
Section 5.05. Appointment of Paying Agent............................89
Section 5.06. U.S.A. Patriot Act Compliance..........................90
ARTICLE VI THE COMPANY AND THE MASTER SERVICER..........................91
Section 6.01. Respective Liabilities of the Company and the
Master Servicer........................................91
Section 6.02. Merger or Consolidation of the Company or the
Master Servicer; Assignment of Rights and
Delegation of Duties by Master Servicer................91
Section 6.03. Limitation on Liability of the Company, the
Master Servicer and Others.............................92
Section 6.04. Company and Master Servicer Not to Resign..............93
ARTICLE VII DEFAULT......................................................94
Section 7.01. Events of Default......................................94
Section 7.02. Trustee or Company to Act; Appointment of Successor....96
Section 7.03. Notification to Certificateholders.....................97
Section 7.04. Waiver of Events of Default............................97
ARTICLE VIII CONCERNING THE TRUSTEE.......................................98
Section 8.01. Duties of Trustee......................................98
Section 8.02. Certain Matters Affecting the Trustee..................99
Section 8.03. Trustee Not Liable for Certificates or Mortgage
Loans.................................................101
Section 8.04. Trustee May Own Certificates..........................101
Section 8.05. Master Servicer to Pay Trustee's Fees and
Expenses; Indemnification.............................101
Section 8.06. Eligibility Requirements for Trustee..................102
Section 8.07. Resignation and Removal of the Trustee................103
Section 8.08. Successor Trustee.....................................104
Section 8.09. Merger or Consolidation of Trustee....................104
Section 8.10. Appointment of Co-Trustee or Separate Trustee.........104
Section 8.11. Appointment of the Custodian..........................105
Section 8.12. Appointment of Office or Agency.......................106
ARTICLE IX TERMINATION OR OPTIONAL PURCHASE OF ALL CERTIFICATES........107
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.................................................107
Section 9.02. Additional Termination Requirements...................110
Section 9.03. Termination of Multiple REMICs........................111
ARTICLE X REMIC PROVISIONS............................................112
Section 10.01. REMIC Administration..................................112
Section 10.02. Master Servicer, REMIC Administrator and Trustee
Indemnification.......................................115
Section 10.03. Designation of REMIC(s)...............................116
Section 10.04. Distributions on the Uncertificated REMIC I and
REMIC II Regular Interests............................116
Section 10.05. Compliance with Withholding Requirements..............116
ARTICLE XI MISCELLANEOUS PROVISIONS....................................117
Section 11.01. Amendment.............................................117
Section 11.02. Recordation of Agreement; Counterparts................119
Section 11.03. Limitation on Rights of Certificateholders............120
Section 11.04. Governing Law.........................................120
Section 11.05. Notices...............................................121
Section 11.06. Required Notices to Rating Agency and Subservicer.....121
Section 11.07. Severability of Provisions............................122
Section 11.08. Supplemental Provisions for Resecuritization..........122
Section 11.09. Allocation of Voting Rights...........................122
Section 11.10. No Petition...........................................122
ARTICLE XII COMPLIANCE WITH REGULATION AB...............................123
Section 12.01. Intent of the Parties; Reasonableness.................123
Section 12.02. Additional Representations and Warranties of the
Trustee...............................................123
Section 12.03. Information to Be Provided by the Trustee.............124
Section 12.04. Report on Assessment of Compliance and Attestation....124
Section 12.05. Indemnification; Remedies.............................125
EXHIBITS
Exhibit A: Form of Class A Certificate
Exhibit A-I: Form of Class X Certificate
Exhibit B: Form of Class M Certificate
Exhibit C: Form of Class B Certificate
Exhibit C-I: Form of Class P Certificate
Exhibit C-II: Form of Class SB Certificate
Exhibit D: Form of Class R Certificate
Exhibit E: Form of Seller/Servicer Contract
Exhibit F: Forms of Request for Release
Exhibit G-1: Form of Transfer Affidavit and Agreement
Exhibit G-2: Form of Transferor Certificate
Exhibit H: Form of Investor Representation Letter
Exhibit I: Form of Transferor Representation Letter
Exhibit J: Form of Rule 144A Investment Representation Letter
Exhibit K: Text of Amendment to Pooling and Servicing Agreement
Pursuant to Section 11.01(e) for a Limited Guaranty
Exhibit L: Form of Limited Guaranty
Exhibit M: Form of Lender Certification for Assignment of Mortgage Loan
Exhibit N: Request for Exchange Form
Exhibit O: Form of Form 10-K Certification
Exhibit P: Form of Back-Up Certification to Form 10-K Certificate
Exhibit Q: Information to be Provided by the Master Servicer to the
Rating Agencies Relating to Reportable Modified Mortgage Loans
Exhibit R: Servicing Criteria
This is the Standard Terms of Pooling and Servicing Agreement, dated as
of October 30, 2006 (the "Standard Terms", and as incorporated by reference
into a Series Supplement dated as of the Cut-off Date, 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 COMPANY, LLC, as master servicer (together
with its permitted successors and assigns, the "Master Servicer"), and the
trustee named in the applicable Series Supplement (together with its
permitted successors and assigns, the "Trustee").
PRELIMINARY STATEMENT:
The Company intends to sell certain mortgage asset-backed pass-through
certificates (collectively, the "Certificates"), to be issued under the
Agreement in multiple classes, which in the aggregate will evidence the
entire beneficial ownership interest in the Mortgage Loans.
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.
Accretion Termination Date: As defined in the Series Supplement.
Accrual Certificates: As defined in the Series Supplement.
Accrued Certificate Interest: With respect to each Distribution Date,
as to any Class or Subclass of Certificates (other than any Principal Only
Certificates), interest accrued during the related Interest Accrual Period at
the related Pass-Through Rate on the Certificate Principal Balance or
Notional Amount thereof immediately prior to such Distribution Date. Accrued
Certificate Interest will be calculated on the basis of a 360-day year,
consisting of twelve 30-day months. In each case Accrued Certificate Interest
on any Class or Subclass of Certificates will be reduced by the amount of:
(i) Prepayment Interest Shortfalls on all Mortgage Loans or, if the
Mortgage Pool is comprised of two or more Loan Groups, on the
Mortgage Loans in the related Loan Group (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 all Mortgage Loans or, if the
Mortgage Pool is comprised of two or more Loan Groups, on the
Mortgage Loans in the related Loan Group (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 Mortgage Loan or REO Property on all
Mortgage Loans or, if the Mortgage Pool is comprised of two or
more Loan Groups, on the Mortgage Loans in the related Loan
Group, which remained unreimbursed following the Cash Liquidation
or REO Disposition of such Mortgage 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 M Certificates and Class B Certificates,
including interest that is not collectible from the Mortgagor
pursuant to the Servicemembers Civil Relief Act of 1940, as
amended, or similar legislation or regulations as in effect from
time to time,
with all such reductions allocated (A) among all of the Certificates in
proportion to their respective amounts of Accrued Certificate Interest
payable on such Distribution Date absent such reductions or (B) if the
Mortgage Pool is comprised of two or more Loan Groups, the related Senior
Percentage of such reductions among the related Senior Certificates in
proportion to the amounts of Accrued Certificate Interest payable from the
related Loan Group on such Distribution Date absent such reductions, with the
remainder of such reductions allocated among the holders of the Class M
Certificates and Class B Certificates in proportion to their respective
amounts of Accrued Certificate Interest payable on such Distribution Date
absent such reductions. In addition to that portion of the reductions
described in the preceding sentence that are allocated to any Class of Class
B Certificates or any Class of Class M Certificates, Accrued Certificate
Interest on such Class of Class B Certificates or such Class of Class M
Certificates will be reduced by the interest portion (adjusted to the Net
Mortgage Rate) of Realized Losses that are allocated solely to such Class of
Class B Certificates or such Class of Class M Certificates pursuant to
Section 4.05.
Addendum and Assignment Agreement: The Addendum and Assignment
Agreement, dated as of January 31, 1995, between MLCC and the Master Servicer.
Additional Collateral: Any of the following held, in addition to the
related Mortgaged Property, as security for a Mortgage Loan: (i) all money,
securities, security entitlements, accounts, general intangibles, payment
rights, instruments, documents, deposit accounts, certificates of deposit,
commodities contracts and other investment property and other property of
whatever kind or description now existing or hereafter acquired which is
pledged as security for the repayment of such Mortgage Loan, (ii) third-party
guarantees, and (A) all money, securities, security entitlements, accounts,
general intangibles, payment rights, instruments, documents, deposit
accounts, certificates of deposit, commodities contracts and other investment
property and other property of whatever kind or description now existing or
hereafter acquired which is pledged as collateral for such guarantee or (B)
any mortgaged property securing the performance of such guarantee, or (iii)
such other collateral as may be set forth in the Series Supplement.
Additional Collateral Loan: Each Mortgage Loan that is supported by
Additional Collateral.
Adjusted Mortgage Rate: With respect to any Mortgage Loan and any date
of determination, the Mortgage Rate borne by the related Mortgage Note, less
the rate at which the related Subservicing Fee accrues.
Advance: As to any Mortgage Loan, any advance made by the Master
Servicer, pursuant to Section 4.04.
Advance Facility: As defined in Section 3.22.
Advance Facility Notice: As defined in Section 3.22.
Advance Facility Trustee: As defined in Section 3.22.
Advancing Person: As defined in Section 3.22.
Advance Reimbursement Amounts: As defined in Section 3.22.
Affiliate: With respect to any Person, any other Person controlling,
controlled by or under common control with such first Person. For the
purposes of this definition, "control" means the power to direct the
management and policies of such Person, directly or indirectly, whether
through the ownership of voting securities, by contract or otherwise; and the
terms "controlling" and "controlled" have meanings correlative to the
foregoing.
Ambac: Ambac Assurance Corporation (formerly known as AMBAC Indemnity
Corporation).
Amount Held for Future Distribution: As to any Distribution Date and,
with respect to any Mortgage Pool that is comprised of two or more Loan
Groups, each Loan Group, the total of the amounts held in the Custodial
Account at the close of business on the preceding Determination Date on
account of (i) Liquidation Proceeds, Subsequent Recoveries, Insurance
Proceeds, Curtailments, Mortgage Loan purchases made pursuant to Section
2.02, 2.03, 2.04 or 4.07 and Mortgage Loan substitutions made pursuant to
Section 2.03 or 2.04 received or made in the month of such Distribution Date
(other than such Liquidation Proceeds, Insurance Proceeds and purchases of
Mortgage Loans that the Master Servicer has deemed to have been received in
the preceding month in accordance with Section 3.07(b)), and Principal
Prepayments in Full made after the related Prepayment Period, and (ii)
payments which represent early receipt of scheduled payments of principal and
interest due on a date or dates subsequent to the related Due Date.
Appraised Value: As to any Mortgaged Property, the lesser of (i) the
appraised value of such Mortgaged Property based upon the appraisal made at
the time of the origination of the related Mortgage Loan, and (ii) the sales
price of the Mortgaged Property at such time of origination, except in the
case of a Mortgaged Property securing a refinanced or modified Mortgage Loan
as to which it is either the appraised value determined above or the
appraised value determined in an appraisal at the time of refinancing or
modification, as the case may be.
Assigned Contracts: With respect to any Pledged Asset Loan: the Credit
Support Pledge Agreement; the Funding and Pledge Agreement, among GMAC
Mortgage, LLC, National Financial Services Corporation and the Mortgagor or
other person pledging the related Pledged Assets; the Additional Collateral
Agreement, between GMAC Mortgage, LLC and the Mortgagor or other person
pledging the related Pledged Assets; or such other contracts as may be set
forth in the Series Supplement.
Assignment: An assignment of the Mortgage, notice of transfer or
equivalent instrument, in recordable form, sufficient under the laws of the
jurisdiction wherein the related Mortgaged Property is located to reflect of
record the sale of the Mortgage Loan to the Trustee for the benefit of
Certificateholders, which assignment, notice of transfer or equivalent
instrument may be in the form of one or more blanket assignments covering
Mortgages secured by Mortgaged Properties located in the same county, if
permitted by law and accompanied by an Opinion of Counsel to that effect.
Assignment Agreement: The Assignment and Assumption Agreement, dated
the Closing Date, between Residential Funding and the Company relating to the
transfer and assignment of the Mortgage Loans.
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.
Assignment of Proprietary Lease: With respect to a Cooperative Loan,
the assignment of the related Cooperative Lease from the Mortgagor to the
originator of the Cooperative Loan.
Available Distribution Amount: As to any Distribution Date and, with
respect to any Mortgage Pool comprised of two or more Loan Groups, 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 (w) aggregate Foreclosure
Profits, (x) the Amount Held for Future Distribution, and (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). Such amount shall be determined separately for each Loan
Group. Additionally, with respect to any Mortgage Pool that is comprised of
two or more Loan Groups, if on any Distribution Date Compensating Interest
provided pursuant to this Section 3.16(e) is less than Prepayment Interest
Shortfalls incurred on the Mortgage Loans in connection with Principal
Prepayments in Full and Curtailments made in the prior calendar month, such
Compensating Interest shall be allocated on such Distribution Date to the
Available Distribution Amount for each Loan Group on a pro rata basis in
accordance with the respective amounts of such Prepayment Interest Shortfalls
incurred on the Mortgage Loans in such Loan Group in respect of such
Distribution Date.
Bankruptcy Code: The Bankruptcy Code of 1978, as amended.
Bankruptcy Loss: With respect to any Mortgage Loan, a Deficient
Valuation or Debt Service Reduction; provided, however, that neither a
Deficient Valuation nor a Debt Service Reduction shall be deemed a Bankruptcy
Loss hereunder so long as the Master Servicer has notified the Trustee in
writing that the Master Servicer is diligently pursuing any remedies that may
exist in connection with the representations and warranties made regarding
the related Mortgage Loan and either (A) the related Mortgage Loan is not in
default with regard to payments due thereunder or (B) delinquent payments of
principal and interest under the related Mortgage Loan and any premiums on
any applicable primary hazard insurance policy and any related escrow
payments in respect of such Mortgage Loan are being advanced on a current
basis by the Master Servicer or a Subservicer, in either case without giving
effect to any Debt Service Reduction.
Book-Entry Certificate: Any Certificate registered in the name of the
Depository or its nominee, and designated as such in the Preliminary
Statement to the Series Supplement.
Business Day: Any day other than (i) a Saturday or a Sunday or (ii) a
day on which banking institutions in the State of New York, the State of
Michigan, the State of California, the State of Illinois or the State of
Minnesota (and such other state or states in which the Custodial Account or
the Certificate Account are at the time located) are required or authorized
by law or executive order to be closed.
Buydown Funds: Any amount contributed by the seller of a Mortgaged
Property, the Company or other source in order to enable the Mortgagor to
reduce the payments required to be made from the Mortgagor's funds in the
early years of a Mortgage Loan. Buydown Funds are not part of the Trust Fund
prior to deposit into the Custodial or Certificate Account.
Buydown Mortgage Loan: Any Mortgage Loan as to which a specified
amount of interest is paid out of related Buydown Funds in accordance with a
related buydown agreement.
Calendar Quarter: A Calendar Quarter shall consist of one of the
following time periods in any given year: January 1 through March 31, April
1 through June 30, July 1 through September 30, and October 1 through
December 31.
Capitalization Reimbursement Amount: With respect to any Distribution
Date and, with respect to any Mortgage Pool comprised of two or more Loan
Groups, each Loan Group, the amount of Advances or Servicing Advances that
were added to the Stated Principal Balance of all Mortgage Loans or, if the
Mortgage Pool is comprised of two or more Loan Groups, on the Mortgage Loans
in the related Loan Group, during the prior 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 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, with respect to any Mortgage Pool comprised of two or
more Loan Groups, 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 all Mortgage Loans (or, if the Mortgage Pool is comprised of two
or more Loan Groups, on 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 Available Distribution Amount (or, if the
Mortgage Pool is comprised of two or more Loan Groups, Available Distribution
Amount for the related Loan Group) for that Distribution Date.
Cash Liquidation: As to any defaulted Mortgage Loan other than a
Mortgage Loan as to which an REO Acquisition occurred, a determination by the
Master Servicer that it has received all Insurance Proceeds, Liquidation
Proceeds and other payments or cash recoveries which the Master Servicer
reasonably and in good faith expects to be finally recoverable with respect
to such Mortgage Loan.
Certificate Account Deposit Date: As to any Distribution Date, the
Business Day prior thereto.
Certificateholder or Holder: The Person in whose name a Certificate is
registered in the Certificate Register, and, in respect of any Insured
Certificates, the Certificate Insurer to the extent of Cumulative Insurance
Payments, except that neither a Disqualified Organization nor a Non-United
States Person shall be a holder of a Class R Certificate for purposes hereof
and, solely for the purpose of giving any consent or direction pursuant to
this Agreement, any Certificate, other than a Class R Certificate, registered
in the name of the Company, the Master Servicer or any Subservicer or any
Affiliate thereof shall be deemed not to be outstanding and the Percentage
Interest or Voting Rights evidenced thereby shall not be taken into account
in determining whether the requisite amount of Percentage Interests or Voting
Rights necessary to effect any such consent or direction has been obtained.
All references herein to "Holders" or "Certificateholders" shall reflect the
rights of Certificate Owners as they may indirectly exercise such rights
through the Depository and participating members thereof, except as otherwise
specified herein; provided, however, that the Trustee shall be required to
recognize as a "Holder" or "Certificateholder" only the Person in whose name
a Certificate is registered in the Certificate Register.
Certificate Insurer: As defined in the Series Supplement.
Certificate Owner: With respect to a Book-Entry Certificate, the
Person who is the beneficial owner of such Certificate, as reflected on the
books of an indirect participating brokerage firm for which a Depository
Participant acts as agent, if any, and otherwise on the books of a Depository
Participant, if any, and otherwise on the books of the Depository.
Certificate Principal Balance: With respect to each Certificate (other
than any Interest Only 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, plus
(ii) any Subsequent Recoveries added to the Certificate Principal
Balance of such Certificate pursuant to Section 4.02, plus
(iii) in the case of each Accrual Certificate, an amount equal to the
aggregate Accrued Certificate Interest added to the Certificate
Principal Balance thereof prior to such date of determination,
minus
(iv) 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(a) 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 Subordinate 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 Certificates
then outstanding over (B) the then aggregate Stated Principal Balance of the
Mortgage Loans.
Certificate Register and Certificate Registrar: The register
maintained and the registrar appointed pursuant to Section 5.02.
Class: Collectively, all of the Certificates bearing the same
designation. The initial Class A-V Certificates and any Subclass thereof
issued pursuant to Section 5.01(c) shall be a single Class for purposes of
this Agreement.
Class A-P Certificate: Any one of the Certificates designated as a
Class A-P Certificate.
Class A-P Collection Shortfall: With respect to the Cash Liquidation
or REO Disposition of a Discount Mortgage Loan, any Distribution Date and,
with respect to any Mortgage Pool comprised of two or more Loan Groups, each
Loan Group, the excess of the amount described in clause (C)(1) of the
definition of Class A-P Principal Distribution Amount (for the related Loan
Group, if applicable) over the amount described in clause (C)(2) of such
definition.
Class A-P Principal Distribution Amount: With respect to any
Distribution Date and, with respect to any Mortgage Pool comprised of two or
more Loan Groups, each Loan Group, an amount equal to the aggregate of:
(A) the related Discount Fraction of the principal portion of
each Monthly Payment on each Discount Mortgage Loan (or, with respect
to any Mortgage Pool comprised of two or more Loan Groups, each
Discount Mortgage Loan in the related Loan Group) due during the
related Due Period, whether or not received on or prior to the related
Determination Date, minus the Discount Fraction of the principal
portion of any related Debt Service Reduction which together with other
Bankruptcy Losses exceeds the Bankruptcy Amount;
(B) the related Discount Fraction of the principal portion of
all unscheduled collections on each Discount Mortgage Loan (or, with
respect to any Mortgage Pool comprised of two or more Loan Groups, each
Discount Mortgage Loan in the related Loan Group) received during the
preceding calendar month or, in the case of Principal Prepayments in
Full, during the related Prepayment Period (other than amounts received
in connection with a Cash Liquidation or REO Disposition of a Discount
Mortgage Loan described in clause (C) below), including Principal
Prepayments in Full, Curtailments, Subsequent Recoveries and
repurchases (including deemed repurchases under Section 3.07(b)) of
such Discount Mortgage Loans (or, in the case of a substitution of a
Deleted Mortgage Loan, the Discount Fraction of the amount of any
shortfall deposited in the Custodial Account in connection with such
substitution);
(C) in connection with the Cash Liquidation or REO Disposition
of a Discount Mortgage Loan (or, with respect to any Mortgage Pool
comprised of two or more Loan Groups, each Discount Mortgage Loan in
the related Loan Group) that occurred during the preceding calendar
month (or was deemed to have occurred during such period in accordance
with Section 3.07(b)) that 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 (1) the applicable Discount
Fraction of the Stated Principal Balance of such Discount Mortgage Loan
immediately prior to such Distribution Date and (2) the aggregate
amount of the collections on such Mortgage Loan to the extent applied
as recoveries of principal;
(D) any amounts allocable to principal for any previous
Distribution Date (calculated pursuant to clauses (A) through (C)
above) that remain undistributed; and
(E) the amount of any Class A-P Collection Shortfalls for such
Distribution Date and the related Loan Group, if applicable, and the
amount of any Class A-P Collection Shortfalls (for the related Loan
Group, if applicable) remaining unpaid for all previous Distribution
Dates, but only to the extent of the Eligible Funds for such
Distribution Date; minus
(F) the related Discount Fraction of the portion of the
Capitalization Reimbursement Amount (for the related Loan Group, if
applicable) for such Distribution Date, if any, related to each
Discount Mortgage Loan (in the related Loan Group, if applicable).
Notwithstanding the foregoing, with respect to any Distribution Date on
and after the Credit Support Depletion Date, the Class A-P Principal
Distribution Amount (for a Loan Group, if applicable) shall equal the excess
of (i) the sum of (a) the related Discount Fraction of the principal portion
of each Monthly Payment on each Discount Mortgage Loan (in the related Loan
Group, if applicable) received or advanced prior to the related Determination
Date and not previously distributed minus the Discount Fraction of the
principal portion of any related Debt Service Reduction which together with
other Bankruptcy Losses exceeds the Bankruptcy Amount and (b) the related
Discount Fraction of the aggregate amount of unscheduled collections
described in clauses (B) and (C) above over (ii) the amount calculated
pursuant to clause (F) above.
Class A-V Certificate: Any one of the Certificates designated as a
Class A-V Certificate, including any Subclass thereof.
Class B Certificate: Any one of the Certificates designated as a Class
B-1 Certificate, Class B-2 Certificate or Class B-3 Certificate.
Class M Certificate: Any one of the Certificates designated as a Class
M-1 Certificate, Class M-2 Certificate or Class M-3 Certificate.
Class P Certificate: Any one of the Certificates designated as a Class
P Certificate.
Class SB Certificate: Any one of the Certificates designated as a
Class SB Certificate.
Class X Certificate: Any one of the Certificates designated as a Class
X Certificate.
Closing Date: As defined in the Series Supplement.
Code: The Internal Revenue Code of 1986, as amended.
Combined Collateral LLC: Combined Collateral LLC, a Delaware limited
liability company.
Commission: The Securities and Exchange Commission.
Compensating Interest: With respect to any Distribution Date, an
amount equal to Prepayment Interest Shortfalls resulting from Principal
Prepayments in Full during the related Prepayment Period and Curtailments
during the prior calendar month and included in the Available Distribution
Amount for such Distribution Date, but not more than the lesser of (a)
one-twelfth of 0.125% of the Stated Principal Balance of the Mortgage Loans
immediately preceding such Distribution Date and (b) the sum of the Servicing
Fee and all income and gain on amounts held in the Custodial Account and the
Certificate Account and payable to the Certificateholders with respect to
such Distribution Date; provided that for purposes of this definition the
amount of the Servicing Fee will not be reduced pursuant to Section 7.02(a)
except as may be required pursuant to the last sentence of such Section.
Compliance With Laws Representation: The following representation and
warranty (or any representation and warranty that is substantially similar)
made by Residential Funding in Section 4 of Assignment Agreement: "Each
Mortgage Loan at the time it was made complied in all material respects with
applicable local, state, and federal laws, including, but not limited to, all
applicable anti-predatory lending laws".
Cooperative: A private, cooperative housing corporation which owns or
leases land and all or part of a building or buildings, including apartments,
spaces used for commercial purposes and common areas therein and whose board
of directors authorizes, among other things, the sale of Cooperative Stock.
Cooperative Apartment: A dwelling unit in a multi-dwelling building
owned or leased by a Cooperative, which unit the Mortgagor has an exclusive
right to occupy pursuant to the terms of a proprietary lease or occupancy
agreement.
Cooperative Lease: With respect to a Cooperative Loan, the proprietary
lease or occupancy agreement with respect to the Cooperative Apartment
occupied by the Mortgagor and relating to the related Cooperative Stock,
which lease or agreement confers an exclusive right to the holder of such
Cooperative Stock to occupy such apartment.
Cooperative Loans: Any of the Mortgage Loans made in respect of a
Cooperative Apartment, evidenced by a Mortgage Note and secured by (i) a
Security Agreement, (ii) the related Cooperative Stock Certificate, (iii) an
assignment of the Cooperative Lease, (iv) financing statements and (v) a
stock power (or other similar instrument), and ancillary thereto, a
recognition agreement between the Cooperative and the originator of the
Cooperative Loan, each of which was transferred and assigned to the Trustee
pursuant to Section 2.01 and are from time to time held as part of the Trust
Fund.
Cooperative Stock: With respect to a Cooperative Loan, the single
outstanding class of stock, partnership interest or other ownership
instrument in the related Cooperative.
Cooperative Stock Certificate: With respect to a Cooperative Loan, the
stock certificate or other instrument evidencing the related Cooperative
Stock.
Credit Repository: Equifax, Transunion and Experian, or their
successors in interest.
Credit Support Depletion Date: The first Distribution Date on which
the Certificate Principal Balances of the Subordinate Certificates have been
reduced to zero.
Credit Support Pledge Agreement: The Credit Support Pledge Agreement,
dated as of November 24, 1998, among the Master Servicer, GMAC Mortgage, LLC,
Combined Collateral LLC and The First National Bank of Chicago (now known as
Bank One, National Association), as custodian.
Cumulative Insurance Payments: As defined in the Series Supplement.
Curtailment: Any Principal Prepayment made by a Mortgagor which is not
a Principal Prepayment in Full.
Custodial Account: The custodial account or accounts created and
maintained pursuant to Section 3.07 in the name of a depository institution,
as custodian for the holders of the Certificates, for the holders of certain
other interests in mortgage loans serviced or sold by the Master Servicer and
for the Master Servicer, into which the amounts set forth in Section 3.07
shall be deposited directly. Any such account or accounts shall be an
Eligible Account.
Custodial Agreement: An agreement that may be entered into among the
Company, the Master Servicer, the Trustee and a Custodian pursuant to which
the Custodian will hold certain documents relating to the Mortgage Loans on
behalf of the Trustee.
Custodial File: Any mortgage loan document in the Mortgage File that
is required to be delivered to the Trustee or Custodian pursuant to Section
2.01(b) of this Agreement.
Custodian: A custodian appointed pursuant to a Custodial Agreement.
Cut-off Date Principal Balance: As to any Mortgage Loan, the unpaid
principal balance thereof at the Cut-off Date after giving effect to all
installments of principal due on or prior thereto (or due during the month of
the Cut-off Date), whether or not received.
Debt Service Reduction: With respect to any Mortgage Loan, a reduction
in the scheduled Monthly Payment for such Mortgage Loan by a court of
competent jurisdiction in a proceeding under the Bankruptcy Code, except such
a reduction constituting a Deficient Valuation or any reduction that results
in a permanent forgiveness of principal.
Deficient Valuation: With respect to any Mortgage Loan, a valuation by
a court of competent jurisdiction of the Mortgaged Property in an amount less
than the then outstanding indebtedness under the Mortgage Loan, or any
reduction in the amount of principal to be paid in connection with any
scheduled Monthly Payment that constitutes a permanent forgiveness of
principal, which valuation or reduction results from a proceeding under the
Bankruptcy Code.
Definitive Certificate: Any Certificate other than a Book-Entry
Certificate.
Deleted Mortgage Loan: A Mortgage Loan replaced or to be replaced with
a Qualified Substitute Mortgage Loan.
Delinquent: As used herein, a Mortgage Loan is considered to be: "30
to 59 days" or "30 or more days" delinquent when a payment due on any
scheduled due date remains unpaid as of the close of business on the last
business day immediately prior to the next following monthly scheduled due
date; "60 to 89 days" or "60 or more days" delinquent when a payment due on
any scheduled due date remains unpaid as of the close of business on the last
business day immediately prior to the second following monthly scheduled due
date; and so on. The determination as to whether a Mortgage Loan falls into
these categories is made as of the close of business on the last business day
of each month. For example, a Mortgage Loan with a payment due on July 1 that
remained unpaid as of the close of business on July 31 would then be
considered to be 30 to 59 days delinquent. Delinquency information as of the
Cut-off Date is determined and prepared as of the close of business on the
last business day immediately prior to the Cut-off Date.
Depository: The Depository Trust Company, or any successor Depository
hereafter named. The nominee of the initial Depository for purposes of
registering those Certificates that are to be Book-Entry Certificates is Cede
& Co. The Depository shall at all times be a "clearing corporation" as
defined in Section 8-102(a)(5) of the Uniform Commercial Code of the State of
New York and a "clearing agency" registered pursuant to the provisions of
Section 17A of the Securities Exchange Act of 1934, as amended.
Depository Participant: A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
Destroyed Mortgage Note: A Mortgage Note the original of which was
permanently lost or destroyed and has not been replaced.
Destroyed Obligation to Pay: An Obligation to Pay the original of
which was permanently lost or destroyed and has not been replaced.
Determination Date: As defined in the Series Supplement.
Discount Fraction: With respect to each Discount Mortgage Loan, the
fraction expressed as a percentage, the numerator of which is the Discount
Net Mortgage Rate minus the Net Mortgage Rate (or the initial Net Mortgage
Rate with respect to any Discount Mortgage Loans as to which the Mortgage
Rate is modified pursuant to 3.07(a)) for such Mortgage Loan and the
denominator of which is the Discount Net Mortgage Rate. The Discount
Fraction with respect to each Discount Mortgage Loan is set forth as an
exhibit attached to the Series Supplement.
Discount Mortgage Loan: Any Mortgage Loan having a Net Mortgage Rate
(or the initial Net Mortgage Rate) of less than the Discount Net Mortgage
Rate per annum and any Mortgage Loan deemed to be a Discount Mortgage Loan
pursuant to the definition of Qualified Substitute Mortgage Loan.
Discount Net Mortgage Rate: As defined in the Series Supplement.
Disqualified Organization: Any organization defined as a "disqualified
organization" under Section 860E(e)(5) of the Code, and if not otherwise
included, any of the following: (i) the United States, any State or
political subdivision thereof, any possession of the United States, or any
agency or instrumentality of any of the foregoing (other than an
instrumentality which is a corporation if all of its activities are subject
to tax and, except for Xxxxxxx Mac, a majority of its board of directors is
not selected by such governmental unit), (ii) a foreign government, any
international organization, or any agency or instrumentality of any of the
foregoing, (iii) any organization (other than certain farmers' cooperatives
described in Section 521 of the Code) which is exempt from the tax imposed by
Chapter 1 of the Code (including the tax imposed by Section 511 of the Code
on unrelated business taxable income), (iv) rural electric and telephone
cooperatives described in Section 1381(a)(2)(C) of the Code, (v) any
"electing large partnership," as defined in Section 775(a) of the Code and
(vi) any other Person so designated by the Trustee based upon an Opinion of
Counsel that the holding of an Ownership Interest in a Class R Certificate by
such Person may cause the Trust Fund or any Person having an Ownership
Interest in any Class of Certificates (other than such Person) to incur a
liability for any federal tax imposed under the Code that would not otherwise
be imposed but for the Transfer of an Ownership Interest in a Class R
Certificate to such Person. The terms "United States", "State" and
"international organization" shall have the meanings set forth in Section
7701 of the Code or successor provisions.
Distribution Date: The 25th day of any month beginning in the month
immediately following the month of the initial issuance of the Certificates
or, if such 25th day is not a Business Day, the Business Day immediately
following such 25th day.
Due Date: With respect to any Distribution Date and any Mortgage Loan,
the day during the related Due Period on which the Monthly Payment is due.
Due Period: With respect to any Distribution Date, the one-month
period set forth in the Series Supplement.
Eligible Account: An account that is any of the following: (i)
maintained with a depository institution the debt obligations of which have
been rated by each Rating Agency in its highest rating available, or (ii) an
account or accounts in a depository institution in which such accounts are
fully insured to the limits established by the FDIC, provided that any
deposits not so insured shall, to the extent acceptable to each Rating
Agency, as evidenced in writing, be maintained such that (as evidenced by an
Opinion of Counsel delivered to the Trustee and each Rating Agency) the
registered Holders of Certificates have a claim with respect to the funds in
such account or a perfected first security interest against any collateral
(which shall be limited to Permitted Investments) securing such funds that is
superior to claims of any other depositors or creditors of the depository
institution with which such account is maintained, or (iii) in the case of
the Custodial Account, a trust account or accounts maintained in the
corporate trust department of the Trustee, or (iv) in the case of the
Certificate Account, a trust account or accounts maintained in the corporate
trust department of the Trustee, or (v) an account or accounts of a
depository institution acceptable to each Rating Agency (as evidenced in
writing by each Rating Agency that use of any such account as the Custodial
Account or the Certificate Account will not reduce the rating assigned to any
Class of Certificates by such Rating Agency below the then-current rating
assigned to such Certificates).
Event of Default: As defined in Section 7.01.
Excess Bankruptcy Loss: Any Bankruptcy Loss, or portion thereof, which
exceeds the then applicable Bankruptcy Amount.
Excess Fraud Loss: Any Fraud Loss, or portion thereof, which exceeds
the then applicable Fraud Loss Amount.
Excess Special Hazard Loss: Any Special Hazard Loss, or portion
thereof, that exceeds the then applicable Special Hazard Amount.
Excess Subordinate Principal Amount: With respect to any Distribution
Date on which the aggregate Certificate Principal Balance of the Class of
Subordinate Certificates then outstanding with the Lowest Priority is to be
reduced to zero and on which Realized Losses are to be allocated to such
class or classes, the excess, if any, of (i) the amount that would otherwise
be distributable in respect of principal on such class or classes of
Certificates on such Distribution Date over (ii) the excess, if any, of the
aggregate Certificate Principal Balance of such class or classes of
Certificates immediately prior to such Distribution Date over the aggregate
amount of Realized Losses to be allocated to such classes of Certificates on
such Distribution Date as reduced by any amount calculated pursuant to clause
(E) of the definition of Class A-P Principal Distribution Amount. With
respect to any Mortgage Pool that is comprised of two or more Loan Groups,
the Excess Subordinate Principal Amount will be allocated between each Loan
Group on a pro rata basis in accordance with the amount of Realized Losses
attributable to each Loan Group and allocated to the Certificates on such
Distribution Date.
Exchange Act: The Securities and Exchange Act of 1934, as amended.
Extraordinary Events: Any of the following conditions with respect to
a Mortgaged Property (or, with respect to a Cooperative Loan, the Cooperative
Apartment) or Mortgage Loan causing or resulting in a loss which causes the
liquidation of such Mortgage Loan:
(a) losses that are of the type that would be covered by the fidelity bond
and the errors and omissions insurance policy required to be maintained
pursuant to Section 3.12(b) but are in excess of the coverage
maintained thereunder;
(b) nuclear reaction or nuclear radiation or radioactive contamination, all
whether controlled or uncontrolled, and whether such loss be direct or
indirect, proximate or remote or be in whole or in part caused by,
contributed to or aggravated by a peril covered by the definition of
the term "Special Hazard Loss";
(c) hostile or warlike action in time of peace or war, including action in
hindering, combating or defending against an actual, impending or
expected attack:
1. by any government or sovereign power, de jure or de facto, or by
any authority maintaining or using military, naval or air forces;
or
2. by military, naval or air forces; or
3. by an agent of any such government, power, authority or forces;
(d) any weapon of war employing atomic fission or radioactive force whether
in time of peace or war; or
(e) insurrection, rebellion, revolution, civil war, usurped power or action
taken by governmental authority in hindering, combating or defending
against such an occurrence, seizure or destruction under quarantine or
customs regulations, confiscation by order of any government or public
authority; or risks of contraband or illegal transportation or trade.
Extraordinary Losses: Any loss incurred on a Mortgage Loan caused by
or resulting from an Extraordinary Event.
Xxxxxx Mae: Federal National Mortgage Association, a federally
chartered and privately owned corporation organized and existing under the
Federal National Mortgage Association Charter Act, or any successor thereto.
FDIC: Federal Deposit Insurance Corporation or any successor thereto.
Final Distribution Date: The Distribution Date on which the final
distribution in respect of the Certificates will be made pursuant to Section
9.01, which Final Distribution Date shall in no event be later than the end
of the 90-day liquidation period described in Section 9.02.
Fitch: Fitch Ratings or its successor in interest.
Foreclosure Profits: As to any Distribution Date or related
Determination Date and any Mortgage Loan, the excess, if any, of Liquidation
Proceeds, Insurance Proceeds and REO Proceeds (net of all amounts
reimbursable therefrom pursuant to Section 3.10(a)(ii)) in respect of each
Mortgage Loan or REO Property for which a Cash Liquidation or REO Disposition
occurred in the related Prepayment Period over the sum of the unpaid
principal balance of such Mortgage Loan or REO Property (determined, in the
case of an REO Disposition, in accordance with Section 3.14) plus accrued and
unpaid interest at the Mortgage Rate on such unpaid principal balance from
the Due Date to which interest was last paid by the Mortgagor to the first
day of the month following the month in which such Cash Liquidation or REO
Disposition occurred.
Form 10-K Certification: As defined in Section 4.03(e).
Fraud Losses: Realized Losses on Mortgage Loans as to which there was
fraud in the origination of such Mortgage Loan.
Xxxxxxx Mac: Federal Home Loan Mortgage Corporation, a corporate
instrumentality of the United States created and existing under Title III of
the Emergency Home Finance Act of 1970, as amended, or any successor thereto.
Highest Priority: As of any date of determination, the Class of
Subordinate Certificates then outstanding with a Certificate Principal
Balance greater than zero, with the earliest priority for payments pursuant
to Section 4.02(a), in the following order: Class M-1, Class M-2, Class M-3,
Class B-1, Class B-2 and Class B-3 Certificates.
Independent: When used with respect to any specified Person, means
such a Person who (i) is in fact independent of the Company, the Master
Servicer and the Trustee, or any Affiliate thereof, (ii) does not have any
direct financial interest or any material indirect financial interest in the
Company, the Master Servicer or the Trustee or in an Affiliate thereof, and
(iii) is not connected with the Company, the Master Servicer or the Trustee
as an officer, employee, promoter, underwriter, trustee, partner, director or
person performing similar functions.
Initial Certificate Principal Balance: With respect to each Class of
Certificates, the Certificate Principal Balance of such Class of Certificates
as of the Cut-off Date, as set forth in the Series Supplement.
Initial Monthly Payment Fund: An amount representing scheduled
principal amortization and interest at the Net Mortgage Rate for the Due Date
in the first Due Period commencing subsequent to the Cut-off Date for those
Mortgage Loans for which the Trustee will not be entitled to receive such
payment, and as more specifically defined in the Series Supplement.
Initial Notional Amount: With respect to any Class or Subclass of
Interest Only Certificates, the amount initially used as the principal basis
for the calculation of any interest payment amount, as more specifically
defined in the Series Supplement.
Initial Subordinate Class Percentage: As defined in the Series
Supplement.
Insurance Proceeds: Proceeds paid in respect of the Mortgage Loans
pursuant to any Primary Insurance Policy or any other related insurance
policy covering a Mortgage Loan (excluding any Certificate Policy (as defined
in the Series Supplement)), to the extent such proceeds are payable to the
mortgagee under the Mortgage, any Subservicer, the Master Servicer or the
Trustee and are not applied to the restoration of the related Mortgaged
Property (or, with respect to a Cooperative Loan, the related Cooperative
Apartment) or released to the Mortgagor in accordance with the procedures
that the Master Servicer would follow in servicing mortgage loans held for
its own account.
Insurer: Any named insurer under any Primary Insurance Policy or any
successor thereto or the named insurer in any replacement policy.
Interest Accrual Period: As defined in the Series Supplement.
Interest Only Certificates: A Class or Subclass of Certificates not
entitled to payments of principal, and designated as such in the Series
Supplement. The Interest Only Certificates will have no Certificate Principal
Balance.
Interim Certification: As defined in Section 2.02.
International Borrower: In connection with any Mortgage Loan, a
borrower who is (a) a United States citizen employed in a foreign country,
(b) a non-permanent resident alien employed in the United States or (c) a
citizen of a country other than the United States with income derived from
sources outside the United States.
Junior Certificateholder: The Holder of not less than 95% of the
Percentage Interests of the Junior Class of Certificates.
Junior Class of Certificates: The Class of Subordinate Certificates
outstanding as of the date of the repurchase of a Mortgage Loan pursuant to
Section 4.07 herein that has the Lowest Priority.
Late Collections: With respect to any Mortgage Loan, all amounts
received during any Due Period, whether as late payments of Monthly Payments
or as Insurance Proceeds, Liquidation Proceeds or otherwise, which represent
late payments or collections of Monthly Payments due but delinquent for a
previous Due Period and not previously recovered.
Liquidation Proceeds: Amounts (other than Insurance Proceeds) received
by the Master Servicer in connection with the taking of an entire Mortgaged
Property by exercise of the power of eminent domain or condemnation or in
connection with the liquidation of a defaulted Mortgage Loan through
trustee's sale, foreclosure sale or otherwise, other than REO Proceeds.
Loan Group: Any group of Mortgage Loans designated as a separate loan
group in the Series Supplement. The Certificates relating to each Loan Group
will be designated in the Series Supplement.
Loan-to-Value Ratio: As of any date, the fraction, expressed as a
percentage, the numerator of which is the current principal balance of the
related Mortgage Loan at the date of determination and the denominator of
which is the Appraised Value of the related Mortgaged Property.
Lower Priority: As of any date of determination and any Class of
Subordinate Certificates, any other Class of Subordinate Certificates then
outstanding with a later priority for payments pursuant to Section 4.02 (a).
Lowest Priority: As of any date of determination, the Class of
Subordinate Certificates then outstanding with a Certificate Principal
Balance greater than zero, with the latest priority for payments pursuant to
Section 4.02(a), in the following order: Class B-3, Class B-2, Class B-1,
Class M-3, Class M-2 and Class M-1 Certificates.
Maturity Date: The latest possible maturity date, solely for purposes
of Section 1.860G-1(a)(4)(iii) of the Treasury regulations, by which the
Certificate Principal Balance of each Class of Certificates (other than the
Interest Only Certificates which have no Certificate Principal Balance) and
each Uncertificated REMIC Regular Interest would be reduced to zero, as
designated in the Series Supplement.
MERS: Mortgage Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of the State of Delaware, or any
successor thereto.
MERS(R)System: The system of recording transfers of Mortgages
electronically maintained by MERS.
MIN: The Mortgage Identification Number for Mortgage Loans registered
with MERS on the MERS(R)System.
MLCC: Xxxxxxx Xxxxx Credit Corporation, or its successor in interest.
Modified Mortgage Loan: Any Mortgage Loan that has been the subject of
a Servicing Modification.
Modified Net Mortgage Rate: As to any Mortgage Loan that is the
subject of a Servicing Modification, the Net Mortgage Rate minus the rate per
annum by which the Mortgage Rate on such Mortgage Loan was reduced.
MOM Loan: With respect to any Mortgage Loan, MERS acting as the
mortgagee of such Mortgage Loan, solely as nominee for the originator of such
Mortgage Loan and its successors and assigns, at the origination thereof.
Monthly Payment: With respect to any Mortgage Loan (including any REO
Property) and any Due Date, the payment of principal and interest due thereon
in accordance with the amortization schedule at the time applicable thereto
(after adjustment, if any, for Curtailments and for Deficient Valuations
occurring prior to such Due Date but before any adjustment to such
amortization schedule by reason of any bankruptcy, other than a Deficient
Valuation, or similar proceeding or any moratorium or similar waiver or grace
period and before any Servicing Modification that constitutes a reduction of
the interest rate on such Mortgage Loan).
Moody's: Xxxxx'x Investors Service, Inc., or its successor in interest.
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 File: The mortgage documents listed in Section 2.01
pertaining to a particular Mortgage Loan and any additional documents
required to be added to the Mortgage File pursuant to this Agreement.
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 Loan Schedule: As defined in the Series Supplement.
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 Pool: The pool of mortgage loans, including all Loan Groups,
if any, consisting of the Mortgage Loans.
Mortgage Rate: As 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 Mortgage Loan, the profit factor described in
the related Obligation to Pay, or any modification thereto other than a
Servicing Modification.
Mortgaged Property: The underlying real property securing a Mortgage
Loan or, with respect to a Cooperative Loan, the related Cooperative Lease
and Cooperative Stock.
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: As to each Mortgage Loan, a per annum rate of
interest equal to the Adjusted Mortgage Rate less the per annum rate at which
the Servicing Fee is calculated.
Non-Discount Mortgage Loan: A Mortgage Loan that is not a Discount
Mortgage Loan.
Non-Primary Residence Loans: The Mortgage Loans designated as secured
by second or vacation residences, or by non-owner occupied residences, on the
Mortgage Loan Schedule.
Non-United States Person: Any Person other than a United States Person.
Nonrecoverable Advance: Any Advance previously made or proposed to be
made by the Master Servicer or Subservicer in respect of a Mortgage Loan
(other than a Deleted Mortgage Loan) which, in the good faith judgment of the
Master Servicer, will not, or, in the case of a proposed Advance, would not,
be ultimately recoverable by the Master Servicer from related Late
Collections, Insurance Proceeds, Liquidation Proceeds, REO Proceeds or
amounts reimbursable to the Master Servicer pursuant to Section 4.02(a)
hereof. To the extent that any Mortgagor is not obligated under the related
Mortgage documents to pay or reimburse any portion of any Servicing Advances
that are outstanding with respect to the related Mortgage Loan as a result of
a modification of such Mortgage Loan by the Master Servicer, which forgives
amounts which the Master Servicer or Subservicer had previously advanced, and
the Master Servicer determines that no other source of payment or
reimbursement for such advances is available to it, such Servicing Advances
shall be deemed to be Nonrecoverable Advances. The determination by the
Master Servicer that it has made a Nonrecoverable Advance or that any
proposed Advance would constitute a Nonrecoverable Advance, shall be
evidenced by an Officers' Certificate delivered to the Company, the Trustee
and any Certificate Insurer.
Nonsubserviced Mortgage Loan: Any Mortgage Loan that, at the time of
reference thereto, is not subject to a Subservicing Agreement.
Notional Amount: With respect to any Class or Subclass of Interest Only
Certificates, an amount used as the principal basis for the calculation of
any interest payment amount, as more specifically defined in the Series
Supplement.
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.
Officers' Certificate: A certificate signed by the Chairman of the
Board, the President or a Vice President or Assistant Vice President, or a
Director or Managing Director, and by the Treasurer, the Secretary, or one of
the Assistant Treasurers or Assistant Secretaries of the Company or the
Master Servicer, as the case may be, and delivered to the Trustee, as
required by this Agreement.
Opinion of Counsel: A written opinion of counsel acceptable to the
Trustee and the Master Servicer, who may be counsel for the Company or the
Master Servicer, provided that any opinion of counsel (i) referred to in the
definition of "Disqualified Organization" or (ii) relating to the
qualification of any REMIC formed under the Series Supplement or compliance
with the REMIC Provisions must, unless otherwise specified, be an opinion of
Independent counsel.
Outstanding Mortgage Loan: As to any Due Date, a Mortgage Loan
(including an REO Property) which was not the subject of a Principal
Prepayment in Full, Cash Liquidation or REO Disposition and which was not
purchased, deleted or substituted for prior to such Due Date pursuant to
Section 2.02, 2.03, 2.04 or 4.07.
Ownership Interest: As to any Certificate, any ownership or security
interest in such Certificate, including any interest in such Certificate as
the Holder thereof and any other interest therein, whether direct or
indirect, legal or beneficial, as owner or as pledgee.
Pass-Through Rate: As defined in the Series Supplement.
Paying Agent: The Trustee or any successor Paying Agent appointed by
the Trustee.
Percentage Interest: With respect to any Certificate (other than a
Class R Certificate), the undivided percentage ownership interest in the
related Class evidenced by such Certificate, which percentage ownership
interest shall be equal to the Initial Certificate Principal Balance thereof
or Initial Notional Amount (in the case of any Interest Only Certificate)
thereof divided by the aggregate Initial Certificate Principal Balance or the
aggregate of the Initial Notional Amounts, as applicable, of all the
Certificates of the same Class. With respect to a Class R Certificate, the
interest in distributions to be made with respect to such Class evidenced
thereby, expressed as a percentage, as stated on the face of each such
Certificate.
Permitted Investments: One or more of the following:
(i) obligations of or guaranteed as to timely payment of principal and
interest by the United States or any agency or instrumentality thereof
when such obligations are backed by the full faith and credit of the
United States;
(ii) repurchase agreements on obligations specified in clause (i) maturing
not more than one month from the date of acquisition thereof, provided
that the unsecured short-term debt obligations of the party agreeing to
repurchase such obligations are at the time rated by each Rating Agency
in its highest short-term rating available;
(iii) federal funds, certificates of deposit, demand deposits, time deposits
and bankers' acceptances (which shall each have an original maturity of
not more than 90 days and, in the case of bankers' acceptances, shall
in no event have an original maturity of more than 365 days or a
remaining maturity of more than 30 days) denominated in United States
dollars of any U.S. depository institution or trust company
incorporated under the laws of the United States or any state thereof
or of any domestic branch of a foreign depository institution or trust
company; provided that the debt obligations of such depository
institution or trust company at the date of acquisition thereof have
been rated by each Rating Agency in its highest short-term rating
available; and, provided further that, if the original maturity of such
short-term obligations of a domestic branch of a foreign depository
institution or trust company shall exceed 30 days, the short-term
rating of such institution shall be A-1+ in the case of Standard &
Poor's if Standard & Poor's is a Rating Agency;
(iv) commercial paper and demand notes (having original maturities of not
more than 365 days) of any corporation incorporated under the laws of
the United States or any state thereof which on the date of acquisition
has been rated by each Rating Agency in its highest short-term rating
available; provided that such commercial paper shall have a remaining
maturity of not more than 30 days;
(v) any mutual fund, money market fund, common trust fund or other pooled
investment vehicle, the assets of which are limited to instruments that
otherwise would constitute Permitted Investments hereunder and have
been rated by each Rating Agency in its highest short-term rating
available (in the case of Standard & Poor's such rating shall be either
AAAm or AAAm-G), including any such fund that is managed by the Trustee
or any affiliate of the Trustee or for which the Trustee or any of its
affiliates acts as an adviser; and
(vi) other obligations or securities that are acceptable to each Rating
Agency as a Permitted Investment hereunder and will not reduce the
rating assigned to any Class of Certificates by such Rating Agency
(without giving effect to any Certificate Policy (as defined in the
Series Supplement) in the case of Insured Certificates (as defined in
the Series Supplement) below the lower of the then-current rating
assigned to such Certificates by such Rating Agency, as evidenced in
writing;
provided, however, no instrument shall be a Permitted Investment if it
represents, either (1) the right to receive only interest payments with
respect to the underlying debt instrument or (2) the right to receive both
principal and interest payments derived from obligations underlying such
instrument and the principal and interest payments with respect to such
instrument provide a yield to maturity greater than 120% of the yield to
maturity at par of such underlying obligations. References herein to the
highest rating available on unsecured long-term debt shall mean AAA in the
case of Standard & Poor's and Fitch and Aaa in the case of Moody's, and for
purposes of this Agreement, any references herein to the highest rating
available on unsecured commercial paper and short-term debt obligations shall
mean the following: A-1 in the case of Standard & Poor's, P-1 in the case of
Moody's and F-1 in the case of Fitch; provided, however, that any Permitted
Investment that is a short-term debt obligation rated A-1 by Standard &
Poor's must satisfy the following additional conditions: (i) the total amount
of debt from A-1 issuers must be limited to the investment of monthly
principal and interest payments (assuming fully amortizing collateral); (ii)
the total amount of A-1 investments must not represent more than 20% of the
aggregate outstanding Certificate Principal Balance of the Certificates and
each investment must not mature beyond 30 days; (iii) the terms of the debt
must have a predetermined fixed dollar amount of principal due at maturity
that cannot vary; and (iv) if the investments may be liquidated prior to
their maturity or are being relied on to meet a certain yield, interest must
be tied to a single interest rate index plus a single fixed spread (if any)
and must move proportionately with that index. Any Permitted Investment may
be held by or through the Trustee or its Affiliates.
Permitted Transferee: Any Transferee of a Class R Certificate, other
than a Disqualified Organization or Non-United States Person.
Person: Any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.
Pledged Amount: With respect to any Pledged Asset Loan, the amount of
money remitted to Combined Collateral LLC, at the direction of or for the
benefit of the related Mortgagor.
Pledged Asset Loan: Any Mortgage Loan supported by Pledged Assets or
such other collateral, other than the related Mortgaged Property, set forth
in the Series Supplement.
Pledged Assets: With respect to any Mortgage Loan, all money,
securities, security entitlements, accounts, general intangibles, payment
intangibles, instruments, documents, deposit accounts, certificates of
deposit, commodities contracts and other investment property and other
property of whatever kind or description pledged by Combined Collateral LLC
as security in respect of any Realized Losses in connection with such
Mortgage Loan up to the Pledged Amount for such Mortgage Loan, and any
related collateral, or such other collateral as may be set forth in the
Series Supplement.
Pledged Asset Mortgage Servicing Agreement: The Pledged Asset Mortgage
Servicing Agreement, dated as of February 28, 1996 between MLCC and the
Master Servicer.
Pooling and Servicing Agreement or Agreement: With respect to any
Series, this Standard Terms together with the related Series Supplement.
Pool Stated Principal Balance: As to any Distribution Date, the
aggregate of the Stated Principal Balances of each Mortgage Loan.
Pool Strip Rate: With respect to each Mortgage Loan, a per annum rate
equal to the excess of (a) the Net Mortgage Rate of such Mortgage Loan over
(b) the Discount Net Mortgage Rate (but not less than 0.00%) per annum.
Prepayment Distribution Trigger: With respect to any Distribution Date
and any Class of Subordinate Certificates (other than the Class M-1
Certificates), a test that shall be satisfied if the fraction (expressed as a
percentage) equal to the sum of the Certificate Principal Balances of such
Class and each Class of Subordinate Certificates with a Lower Priority than
such Class immediately prior to such Distribution Date divided by the
aggregate Stated Principal Balance of all of the Mortgage Loans (or related
REO Properties) immediately prior to such Distribution Date is greater than
or equal to the sum of the related Initial Subordinate Class Percentages of
such Classes of Subordinate Certificates.
Prepayment Interest Shortfall: As to any Distribution Date and any
Mortgage Loan (other than a Mortgage Loan relating to an REO Property) that
was the subject of (a) a Principal Prepayment in Full during the portion of
the related Prepayment Period that falls during the prior calendar month, an
amount equal to the excess of one month's interest at the Net Mortgage Rate
(or Modified Net Mortgage Rate in the case of a Modified Mortgage Loan) on
the Stated Principal Balance of such Mortgage Loan over the amount of
interest (adjusted to the Net Mortgage Rate (or Modified Net Mortgage Rate in
the case of a Modified Mortgage Loan)) paid by the Mortgagor for such month
to the date of such Principal Prepayment in Full or (b) a Curtailment during
the prior calendar month, an amount equal to one month's interest at the Net
Mortgage Rate (or Modified Net Mortgage Rate in the case of a Modified
Mortgage Loan) on the amount of such Curtailment.
Prepayment Period: As to any Distribution Date and Principal
Prepayment in Full, the period commencing on the 16th day of the month prior
to the month in which that Distribution Date occurs and ending on the 15th
day of the month in which such Distribution Date occurs.
Primary Insurance Policy: Each primary policy of mortgage guaranty
insurance or any replacement policy therefor referred to in Section
2.03(b)(iv) and (v).
Principal Only Certificates: A Class of Certificates not entitled to
payments of interest, and more specifically designated as such in the Series
Supplement.
Principal Prepayment: Any payment of principal or other recovery on a
Mortgage Loan, including a recovery that takes the form of Liquidation
Proceeds or Insurance Proceeds, which is received in advance of its scheduled
Due Date and is not accompanied by an amount as to interest representing
scheduled interest on such payment due on any date or dates in any month or
months subsequent to the month of prepayment.
Principal Prepayment in Full: Any Principal Prepayment of the entire
principal balance of a Mortgage Loan that is made by the Mortgagor.
Program Guide: Collectively, the Client Guide and the Servicer Guide
for Residential Funding's Expanded Criteria Mortgage Program.
Purchase Price: With respect to any Mortgage Loan (or REO Property)
required to be or otherwise purchased on any date pursuant to Section 2.02,
2.03, 2.04 or 4.07, an amount equal to the sum of (i) 100% of the Stated
Principal Balance thereof plus the principal portion of any related
unreimbursed Advances and (ii) unpaid accrued interest at the Adjusted
Mortgage Rate (or Modified Net Mortgage Rate plus the rate per annum at which
the Servicing Fee is calculated in the case of a Modified Mortgage Loan) (or
at the Net Mortgage Rate (or Modified Net Mortgage Rate in the case of a
Modified Mortgage Loan) in the case of a purchase made by the Master
Servicer) on the Stated Principal Balance thereof to the Due Date in the Due
Period related to the Distribution Date occurring in the month following the
month of purchase from the Due Date to which interest was last paid by the
Mortgagor.
Qualified Substitute Mortgage Loan: A Mortgage Loan substituted by
Residential Funding or the Company for a Deleted Mortgage Loan which must, on
the date of such substitution, as confirmed in an Officers' Certificate
delivered to the Trustee, with a copy to the Custodian,
(i) have an outstanding principal balance, after deduction of the
principal portion of the monthly payment due in the month of
substitution (or in the case of a substitution of more than one
Mortgage Loan for a Deleted Mortgage Loan, an aggregate
outstanding principal balance, after such deduction), not in
excess of the Stated Principal Balance of the Deleted Mortgage
Loan (the amount of any shortfall to be deposited by Residential
Funding in the Custodial Account in the month of substitution);
(ii) have a Mortgage Rate and a Net Mortgage Rate no lower than and
not more than 1% per annum higher than the Mortgage Rate and Net
Mortgage Rate, respectively, of the Deleted Mortgage Loan as of
the date of substitution;
(iii) have a Loan-to-Value Ratio at the time of substitution no
higher than that of the Deleted Mortgage Loan at the time of
substitution;
(iv) have a remaining term to stated maturity not greater than (and
not more than one year less than) that of the Deleted Mortgage
Loan;
(v) comply with each representation and warranty set forth in
Sections 2.03 and 2.04 hereof and Section 4 of the Assignment
Agreement; and
(vi) have a Pool Strip Rate equal to or greater than that of the
Deleted Mortgage Loan.
Notwithstanding any other provisions herein, (x) with respect to any
Qualified Substitute Mortgage Loan substituted for a Deleted Mortgage Loan
which was a Discount Mortgage Loan, such Qualified Substitute Mortgage Loan
shall be deemed to be a Discount Mortgage Loan and to have a Discount
Fraction equal to the Discount Fraction of the Deleted Mortgage Loan and (y)
in the event that the "Pool Strip Rate" of any Qualified Substitute Mortgage
Loan as calculated pursuant to the definition of "Pool Strip Rate" is greater
than the Pool Strip Rate of the related Deleted Mortgage Loan
(i) the Pool Strip Rate of such Qualified Substitute Mortgage Loan
shall be equal to the Pool Strip Rate of the related Deleted
Mortgage Loan for purposes of calculating the Pass-Through Rate
on the Class A-V Certificates and
(ii) the excess of the Pool Strip Rate on such Qualified Substitute
Mortgage Loan as calculated pursuant to the definition of "Pool
Strip Rate" over the Pool Strip Rate on the related Deleted
Mortgage Loan shall be payable to the Class R Certificates
pursuant to Section 4.02 hereof.
Rating Agency: Each of the statistical credit rating agencies
specified in the Preliminary Statement of the Series Supplement. If any
agency or a successor is no longer in existence, "Rating Agency" shall be
such statistical credit rating agency, or other comparable Person, designated
by the Company, notice of which designation shall be given to the Trustee and
the Master Servicer.
Realized Loss: With respect to each Mortgage Loan (or REO Property):
(a) as to which a Cash Liquidation or REO Disposition has occurred,
an amount (not less than zero) equal to (i) the Stated Principal
Balance of the Mortgage Loan (or REO Property) as of the date of
Cash Liquidation or REO Disposition, plus (ii) interest (and REO
Imputed Interest, if any) at the Net Mortgage Rate from the Due
Date as to which interest was last paid or advanced to
Certificateholders up to the Due Date in the Due Period related
to the Distribution Date on which such Realized Loss will be
allocated pursuant to Section 4.05 on the Stated Principal
Balance of such Mortgage Loan (or REO Property) outstanding
during each Due Period that such interest was not paid or
advanced, minus (iii) the proceeds, if any, received during the
month in which such Cash Liquidation (or REO Disposition)
occurred, to the extent applied as recoveries of interest at the
Net Mortgage Rate and to principal of the Mortgage Loan, net of
the portion thereof reimbursable to the Master Servicer or any
Subservicer with respect to related Advances, Servicing Advances
or other expenses as to which the Master Servicer or Subservicer
is entitled to reimbursement thereunder but which have not been
previously reimbursed,
(b) which is the subject of a Servicing Modification, (i) (1) the
amount by which the interest portion of a Monthly Payment or the
principal balance of such Mortgage Loan was reduced or (2) the
sum of any other amounts owing under the Mortgage Loan that were
forgiven and that constitute Servicing Advances that are
reimbursable to the Master Servicer or a Subservicer, and (ii)
any such amount with respect to a Monthly Payment that was or
would have been due in the month immediately following the month
in which a Principal Prepayment or the Purchase Price of such
Mortgage Loan is received or is deemed to have been received,
(c) which has become the subject of a Deficient Valuation, the
difference between the principal balance of the Mortgage Loan
outstanding immediately prior to such Deficient Valuation and the
principal balance of the Mortgage Loan as reduced by the
Deficient Valuation, or
(d) which has become the object of a Debt Service Reduction, the
amount of such Debt Service Reduction.
Notwithstanding the above, neither a Deficient Valuation nor a Debt Service
Reduction shall be deemed a Realized Loss hereunder so long as the Master
Servicer has notified the Trustee in writing that the Master Servicer is
diligently pursuing any remedies that may exist in connection with the
representations and warranties made regarding the related Mortgage Loan and
either (A) the related Mortgage Loan is not in default with regard to
payments due thereunder or (B) delinquent payments of principal and interest
under the related Mortgage Loan and any premiums on any applicable primary
hazard insurance policy and any related escrow payments in respect of such
Mortgage Loan are being advanced on a current basis by the Master Servicer or
a Subservicer, in either case without giving effect to any Debt Service
Reduction.
To the extent the Master Servicer receives Subsequent Recoveries with respect
to any Mortgage Loan, the amount of the Realized Loss with respect to that
Mortgage Loan will be reduced to the extent such recoveries are applied to
reduce the Certificate Principal Balance of any Class of Certificates on any
Distribution Date.
Record Date: With respect to each Distribution Date, the close of
business on the last Business Day of the month next preceding the month in
which the related Distribution Date occurs.
Regular Certificate: Any of the Certificates other than a Class R
Certificate.
Regulation AB: Subpart 229.1100 - Asset Backed Securities (Regulation
AB), 17 C.F.R.ss.ss.229.1100-229.1123, as such may be amended from time to time,
and subject to such clarification and interpretation as have been provided by
the Commission in the adopting release (Asset-Backed Securities, Securities
Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (January 7, 2005)) or by
the staff of the Commission, or as may be provided by the Commission or its
staff from time to time.
Reimbursement Amounts: As defined in Section 3.22.
REMIC: A "real estate mortgage investment conduit" within the meaning
of Section 860D of the Code.
REMIC Administrator: Residential Funding Company, LLC. If Residential
Funding Company, LLC is found by a court of competent jurisdiction to no
longer be able to fulfill its obligations as REMIC Administrator under this
Agreement the Master Servicer or Trustee acting as Master Servicer shall
appoint a successor REMIC Administrator, subject to assumption of the REMIC
Administrator obligations under this Agreement.
REMIC Provisions: Provisions of the federal income tax law relating to
real estate mortgage investment conduits, which appear at Sections 860A
through 860G of Subchapter M of Chapter 1 of the Code, and related
provisions, and temporary and final regulations (or, to the extent not
inconsistent with such temporary or final regulations, proposed regulations)
and published rulings, notices and announcements promulgated thereunder, as
the foregoing may be in effect from time to time.
REO Acquisition: The acquisition by the Master Servicer on behalf of
the Trustee for the benefit of the Certificateholders of any REO Property
pursuant to Section 3.14.
REO Disposition: As to any REO Property, a determination by the Master
Servicer that it has received all Insurance Proceeds, Liquidation Proceeds,
REO Proceeds and other payments and recoveries (including proceeds of a final
sale) which the Master Servicer expects to be finally recoverable from the
sale or other disposition of the REO Property.
REO Imputed Interest: As to any REO Property, for any period, an
amount equivalent to interest (at the Net Mortgage Rate that would have been
applicable to the related Mortgage Loan had it been outstanding) on the
unpaid principal balance of the Mortgage Loan as of the date of acquisition
thereof for such period.
REO Proceeds: Proceeds, net of expenses, received in respect of any
REO Property (including, without limitation, proceeds from the rental of the
related Mortgaged Property or, with respect to a Cooperative Loan, the
related Cooperative Apartment) which proceeds are required to be deposited
into the Custodial Account only upon the related REO Disposition.
REO Property: A Mortgaged Property acquired by the Master Servicer
through foreclosure or deed in lieu of foreclosure in connection with a
defaulted Mortgage Loan.
Reportable Modified Mortgage Loan: Any Mortgage Loan that (i) has been
subject to an interest rate reduction, (ii) has been subject to a term
extension or (iii) has had amounts owing on such Mortgage Loan capitalized by
adding such amount to the Stated Principal Balance of such Mortgage Loan;
provided, however, that a Mortgage Loan modified in accordance with clause
(i) above for a temporary period shall not be a Reportable Modified Mortgage
Loan if such Mortgage Loan has not been delinquent in payments of principal
and interest for six months since the date of such modification if that
interest rate reduction is not made permanent thereafter.
Request for Release: A request for release, the forms of which are
attached as Exhibit F hereto, or an electronic request in a form acceptable
to the Custodian.
Required Insurance Policy: With respect to any Mortgage Loan, any
insurance policy which is required to be maintained from time to time under
this Agreement, the Program Guide or the related Subservicing Agreement in
respect of such Mortgage Loan.
Required Surety Payment: With respect to any Additional Collateral
Loan that becomes a Liquidated Mortgage Loan, the lesser of (i) the principal
portion of the Realized Loss with respect to such Mortgage Loan and (ii) the
excess, if any, of (a) the amount of Additional Collateral required at
origination with respect to such Mortgage Loan over (b) the net proceeds
realized by the Subservicer from the related Additional Collateral.
Residential Funding: Residential Funding Company, LLC, a Delaware
limited liability company, in its capacity as seller of the Mortgage Loans to
the Company and any successor thereto.
Responsible Officer: When used with respect to the Trustee, any
officer of the Corporate Trust Department of the Trustee, including any
Senior Vice President, any Vice President, any Assistant Vice President, any
Assistant Secretary, any Trust Officer or Assistant Trust Officer, or any
other officer of the Trustee customarily performing functions similar to
those performed by any of the above designated officers to whom, with respect
to a particular matter, such matter is referred, in each case with direct
responsibility for the administration of the Agreement.
Retail Certificates: A Senior Certificate, if any, offered in smaller
minimum denominations than other Senior Certificates, and designated as such
in the Series Supplement.
Schedule of Discount Fractions: The schedule setting forth the
Discount Fractions with respect to the Discount Mortgage Loans, attached as
an exhibit to the Series Supplement.
Securitization Transaction: Any transaction involving a sale or other
transfer of mortgage loans directly or indirectly to an issuing entity in
connection with an issuance of publicly offered or privately placed, rated or
unrated mortgage-backed securities.
Security Agreement: With respect to a Cooperative Loan, the agreement
creating a security interest in favor of the originator in the related
Cooperative Stock.
Seller: As to any Mortgage Loan, a Person, including any Subservicer,
that executed a Seller's Agreement applicable to such Mortgage Loan.
Seller's Agreement: An agreement for the origination and sale of
Mortgage Loans generally in the form of the Seller Contract referred to or
contained in the Program Guide, or in such other form as has been approved by
the Master Servicer and the Company, each containing representations and
warranties in respect of one or more Mortgage Loans consistent in all
material respects with those set forth in the Program Guide.
Senior Accelerated Distribution Percentage: With respect to any
Distribution Date occurring on or prior to the 60th Distribution Date and,
with respect to any Mortgage Pool comprised of two or more Loan Groups, any
Loan Group, 100%. With respect to any Distribution Date thereafter and any
such Loan Group, if applicable, as follows:
(i) for any Distribution Date after the 60th Distribution Date but on or
prior to the 72nd Distribution Date, the related Senior Percentage for
such Distribution Date plus 70% of the related Subordinate Percentage
for such Distribution Date;
(ii) for any Distribution Date after the 72nd Distribution Date but on or
prior to the 84th Distribution Date, the related Senior Percentage for
such Distribution Date plus 60% of the related Subordinate Percentage
for such Distribution Date;
(iii) for any Distribution Date after the 84th Distribution Date but on or
prior to the 96th Distribution Date, the related Senior Percentage for
such Distribution Date plus 40% of the related Subordinate Percentage
for such Distribution Date;
(iv) for any Distribution Date after the 96th Distribution Date but on or
prior to the 108th Distribution Date, the related Senior Percentage for
such Distribution Date plus 20% of the related Subordinate Percentage
for such Distribution Date; and
(v) for any Distribution Date thereafter, the Senior Percentage for such
Distribution Date;
provided, however,
(i) that any scheduled reduction to the Senior Accelerated Distribution
Percentage described above shall not occur as of any Distribution Date unless
either
(a)(1)(X) the outstanding principal balance of the Mortgage Loans
delinquent 60 days or more (including Mortgage Loans 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 Subordinate
Certificates, is less than 50% or (Y) the outstanding principal balance
of Mortgage Loans delinquent 60 days or more (including Mortgage Loans
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 principal balance of all Mortgage Loans averaged
over the last six months, does not exceed 2% and (2) Realized Losses on
the Mortgage Loans to date for such Distribution Date if occurring
during the sixth, seventh, eighth, ninth or tenth 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 Subordinate Certificates or
(b)(1) the outstanding principal balance of Mortgage Loans
delinquent 60 days or more (including Mortgage Loans 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 principal balance of all Mortgage Loans averaged over the
last six months, does not exceed 4% and (2) Realized Losses on the
Mortgage Loans to date for such Distribution Date, if occurring during
the sixth, seventh, eighth, ninth or tenth year (or any year
thereafter) after the Closing Date are less than 10%, 15%, 20%, 25% or
30%, respectively, of the sum of the Initial Certificate Principal
Balances of the Subordinate Certificates, and
(ii) that for any Distribution Date on which the Senior Percentage is
greater than the Senior Percentage as of the Closing Date, the Senior
Accelerated Distribution Percentage for such Distribution Date shall be 100%,
or, if the Mortgage Pool is comprised of two or more Loan Groups, for any
Distribution Date on which the weighted average of the Senior Percentages for
each Loan Group, weighted on the basis of the Stated Principal Balances of
the Mortgage Loans in the related Loan Group (excluding the Discount Fraction
of the Discount Mortgage Loans in such Loan Group) exceeds the weighted
average of the initial Senior Percentages (calculated on such basis) for each
Loan Group, each of the Senior Accelerated Distribution Percentages for such
Distribution Date will equal 100%.
Notwithstanding the foregoing, upon the reduction of the Certificate
Principal Balances of the related Senior Certificates (other than the Class
A-P Certificates, if any) to zero, the related Senior Accelerated
Distribution Percentage shall thereafter be 0%.
Senior Certificate: As defined in the Series Supplement.
Senior Percentage: As defined in the Series Supplement.
Senior Support Certificate: A Senior Certificate that provides
additional credit enhancement to certain other classes of Senior Certificates
and designated as such in the Preliminary Statement of the Series Supplement.
Series: All of the Certificates issued pursuant to a Pooling and
Servicing Agreement and bearing the same series designation.
Series Supplement: The agreement into which this Standard Terms is
incorporated and pursuant to which, together with this Standard Terms, a
Series of Certificates is issued.
Servicing Accounts: The account or accounts created and maintained
pursuant to Section 3.08.
Servicing Criteria: The "servicing criteria" set forth in Item 1122(d)
of Regulation AB, as such may be amended from time to time.
Servicing Advances: All customary, reasonable and necessary "out of
pocket" costs and expenses incurred in connection with a default, delinquency
or other unanticipated event by the Master Servicer or a Subservicer in the
performance of its servicing obligations, including, but not limited to, the
cost of (i) the preservation, restoration and protection of a Mortgaged
Property or, with respect to a Cooperative Loan, the related Cooperative
Apartment, (ii) any enforcement or judicial proceedings, including
foreclosures, including any expenses incurred in relation to any such
proceedings that result from the Mortgage Loan being registered on the MERS
System, (iii) the management and liquidation of any REO Property, (iv) any
mitigation procedures implemented in accordance with Section 3.07, and (v)
compliance with the obligations under Sections 3.01, 3.08, 3.11, 3.12(a) and
3.14, including, if the Master Servicer or any Affiliate of the Master
Servicer provides services such as appraisals and brokerage services that are
customarily provided by Persons other than servicers of mortgage loans,
reasonable compensation for such services.
Servicing Advance Reimbursement Amounts: As defined in Section 3.22.
Servicing Fee: With respect to any Mortgage Loan and Distribution
Date, the fee payable monthly to the Master Servicer in respect of master
servicing compensation that accrues at an annual rate designated on the
Mortgage Loan Schedule as the "MSTR SERV FEE" for such Mortgage Loan, as may
be adjusted with respect to successor Master Servicers as provided in Section
7.02.
Servicing Modification: Any reduction of the interest rate on or the
outstanding principal balance of a Mortgage Loan, any extension of the final
maturity date of a Mortgage Loan, and any increase to the outstanding
principal balance of a Mortgage Loan by adding to the Stated Principal
Balance unpaid principal and interest and other amounts owing under the
Mortgage Loan, in each case pursuant to a modification of a Mortgage Loan
that is in default, or for which, in the judgment of the Master Servicer,
default is reasonably foreseeable in accordance with Section 3.07(a).
Servicing Officer: Any officer of the Master Servicer involved in, or
responsible for, the administration and servicing of the Mortgage Loans whose
name and specimen signature appear on a list of servicing officers furnished
to the Trustee by the Master Servicer, as such list may from time to time be
amended.
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.
Special Hazard Loss: Any Realized Loss not in excess of the cost of
the lesser of repair or replacement of a Mortgaged Property (or, with respect
to a Cooperative Loan, the related Cooperative Apartment) suffered by such
Mortgaged Property (or Cooperative Apartment) on account of direct physical
loss, exclusive of (i) any loss of a type covered by a hazard policy or a
flood insurance policy required to be maintained in respect of such Mortgaged
Property pursuant to Section 3.12(a), except to the extent of the portion of
such loss not covered as a result of any coinsurance provision and (ii) any
Extraordinary Loss.
Standard & Poor's: Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies, Inc., or its successor in interest.
Stated Principal Balance: With respect to any Mortgage Loan or related
REO Property, as of any Distribution Date, (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 related to the previous
Distribution Date which were received or with respect to which an Advance was
made, and (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 allocated to
Certificateholders with respect thereto for any previous Distribution Date.
Subclass: With respect to the Class A-V Certificates, any Subclass
thereof issued pursuant to Section 5.01(c). Any such Subclass will represent
the Uncertificated Class A-V REMIC Regular Interest or Interests specified by
the initial Holder of the Class A-V Certificates pursuant to Section 5.01(c).
Subordinate Certificate: Any one of the Class M Certificates or Class
B Certificates, executed by the Trustee and authenticated by the Certificate
Registrar substantially in the form annexed hereto as Exhibit B and Exhibit
C, respectively.
Subordinate Class Percentage: With respect to any Distribution Date
and any Class of Subordinate Certificates, a fraction, expressed as a
percentage, the numerator of which is the aggregate Certificate Principal
Balance of such Class of Subordinate Certificates immediately prior to such
date and the denominator of which is the aggregate Stated Principal Balance
of all of the Mortgage Loans (or related REO Properties) (other than the
related Discount Fraction of each Discount Mortgage Loan) immediately prior
to such Distribution Date.
Subordinate Percentage: As of any Distribution Date and, with respect
to any Mortgage Pool comprised of two or more Loan Groups, any Loan Group,
100% minus the related Senior Percentage as of such Distribution Date.
Subsequent Recoveries: As of any Distribution Date, amounts received by
the Master Servicer (net of any related expenses permitted to be reimbursed
pursuant to Section 3.10) or surplus amounts held by the Master Servicer to
cover estimated expenses (including, but not limited to, recoveries in
respect of the representations and warranties made by the related Seller
pursuant to the applicable Seller's Agreement and assigned to the Trustee
pursuant to Section 2.04) specifically related to a Mortgage Loan that was
the subject of a Cash Liquidation or an REO Disposition prior to the related
Prepayment Period that resulted in a Realized Loss.
Subserviced Mortgage Loan: Any Mortgage Loan that, at the time of
reference thereto, is subject to a Subservicing Agreement.
Subservicer: Any Person with whom the Master Servicer has entered into
a Subservicing Agreement and who generally satisfied the requirements set
forth in the Program Guide in respect of the qualification of a Subservicer
as of the date of its approval as a Subservicer by the Master Servicer.
Subservicer Advance: Any delinquent installment of principal and
interest on a Mortgage Loan which is advanced by the related Subservicer (net
of its Subservicing Fee) pursuant to the Subservicing Agreement.
Subservicing Account: An account established by a Subservicer in
accordance with Section 3.08.
Subservicing Agreement: The written contract between the Master
Servicer and any Subservicer relating to servicing and administration of
certain Mortgage Loans as provided in Section 3.02, generally in the form of
the servicer contract referred to or contained in the Program Guide or in
such other form as has been approved by the Master Servicer and the Company.
With respect to Additional Collateral Loans subserviced by MLCC, the
Subservicing Agreement shall also include the Addendum and Assignment
Agreement and the Pledged Asset Mortgage Servicing Agreement. With respect to
any Pledged Asset Loan subserviced by GMAC Mortgage, LLC, the Addendum and
Assignment Agreement, dated as of November 24, 1998, between the Master
Servicer and GMAC Mortgage, LLC, as such agreement may be amended from time
to time.
Subservicing Fee: As to any Mortgage Loan, the fee payable monthly to
the related Subservicer (or, in the case of a Nonsubserviced Mortgage Loan,
to the Master Servicer) in respect of subservicing and other compensation
that accrues at an annual rate equal to the excess of the Mortgage Rate borne
by the related Mortgage Note over the rate per annum designated on the
Mortgage Loan Schedule as the "CURR NET" for such Mortgage Loan.
Successor Master Servicer: As defined in Section 3.22.
Surety: Ambac, or its successors in interest, or such other surety as
may be identified in the Series Supplement.
Surety Bond: The Limited Purpose Surety Bond (Policy No. AB0039BE),
dated February 28, 1996 in respect to Mortgage Loans originated by MLCC, or
the Surety Bond (Policy No. AB0240BE), dated March 17, 1999 in respect to
Mortgage Loans originated by Novus Financial Corporation, in each case issued
by Ambac for the benefit of certain beneficiaries, including the Trustee for
the benefit of the Holders of the Certificates, but only to the extent that
such Surety Bond covers any Additional Collateral Loans, or such other Surety
Bond as may be identified in the Series Supplement.
Tax Returns: The federal income tax return on Internal Revenue Service
Form 1066, U.S. Real Estate Mortgage Investment Conduit Income Tax Return,
including Schedule Q thereto, Quarterly Notice to Residual Interest Holders
of REMIC Taxable Income or Net Loss Allocation, or any successor forms, to be
filed on behalf of any REMIC formed under the Series Supplement and under the
REMIC Provisions, together with any and all other information, reports or
returns that may be required to be furnished to the Certificateholders or
filed with the Internal Revenue Service or any other governmental taxing
authority under any applicable provisions of federal, state or local tax laws.
Transaction Party: As defined in Section 12.02(a).
Transfer: Any direct or indirect transfer, sale, pledge, hypothecation
or other form of assignment of any Ownership Interest in a Certificate.
Transferee: Any Person who is acquiring by Transfer any Ownership
Interest in a Certificate.
Transferor: Any Person who is disposing by Transfer of any Ownership
Interest in a Certificate.
Trust Fund: The segregated pool of assets related to a Series, with
respect to which one or more REMIC elections are to be made pursuant to this
Agreement, consisting of:
(i) the Mortgage Loans and the related Mortgage Files and collateral
securing such Mortgage Loans,
(ii) all payments on and collections in respect of the Mortgage Loans due
after 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, including the proceeds from the liquidation of Additional
Collateral for any Additional Collateral Loan or Pledged Assets for any
Pledged Asset Loan, but not including amounts on deposit in the Initial
Monthly Payment Fund,
(iii) property that secured a Mortgage Loan and that 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, if any,
the Pledged Assets with respect to each Pledged Asset Loan, and the
interest in the Surety Bond transferred to the Trustee pursuant to
Section 2.01, and
(v) all proceeds of clauses (i) through (iv) above.
Trustee Information: As specified in Section 12.05(a)(i)(A).
Uninsured Cause: Any cause of damage to property subject to a Mortgage
such that the complete restoration of such property is not fully reimbursable
by the hazard insurance policies.
United States Person or U.S. Person: (i) A citizen or resident of the
United States, (ii) a corporation, partnership or other entity treated as a
corporation or partnership for United States federal income tax purposes
organized in or under the laws of the United States or any state thereof or
the District of Columbia (unless, in the case of a partnership, Treasury
regulations provide otherwise), provided that, for purposes solely of the
restrictions on the transfer of residual interests, no partnership or other
entity treated as a partnership for United States federal income tax purposes
shall be treated as a United States Person or U.S. Person unless all persons
that own an interest in such partnership either directly or indirectly
through any chain of entities no one of which is a corporation for United
States federal income tax purposes are required by the applicable operating
agreement to be United States Persons, (iii) an estate the income of which
is includible in gross income for United States tax purposes, regardless of
its source, or (iv) a trust if a court within the United States is able to
exercise primary supervision over the administration of the trust and one or
more United States persons have authority to control all substantial
decisions of the trust. Notwithstanding the preceding sentence, to the
extent provided in Treasury regulations, certain Trusts in existence on
August 20, 1996, and treated as United States persons prior to such date,
that elect to continue to be treated as United States persons will also be a
U.S. Person.
U.S.A. Patriot Act: Uniting and Strengthening America by Providing
Appropriate Tools to Intercept and Obstruct Terrorism Act of 2001, as amended.
Voting Rights: The portion of the voting rights of all of the
Certificates which is allocated to any Certificate, and more specifically
designated in Article XI of the Series Supplement.
Section 1.02 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.
(a) The Company, concurrently with the execution and delivery hereof, does
hereby assign to the Trustee for the benefit of the Certificateholders
without recourse all the right, title and interest of the Company in and to
the Mortgage Loans, including all interest and principal received on or with
respect to the Mortgage Loans after the Cut-off Date (other than payments of
principal and interest due on the Mortgage Loans in the month of the Cut-off
Date). In connection with such transfer and assignment, the Company does
hereby deliver to the Trustee the Certificate Policy (as defined in the
Series Supplement), if any for the benefit of the Holders of the Insured
Certificates (as defined in the Series Supplement).
(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 (1)
with respect to each Mortgage Loan (other than a Cooperative Loan or a Sharia
Mortgage Loan), deliver to the Master Servicer (or an Affiliate of the Master
Servicer) each of the documents or instruments described in clause (I)(ii)
below (and the Master Servicer shall hold (or cause such Affiliate to hold)
such documents or instruments in trust for the use and benefit of all present
and future Certificateholders), (2) with respect to each MOM Loan, deliver to
and deposit with the Trustee, or the Custodian on behalf of the Trustee, the
documents or instruments described in clauses (I)(i) and (v) below, (3) with
respect to each Mortgage Loan that is not a MOM Loan but is registered on the
MERS(R)System, deliver to and deposit with the Trustee, or to the Custodian on
behalf of the Trustee, the documents or instruments described in clauses
(I)(i), (iv) and (v) below, (4) with respect to each Mortgage Loan that is
not a MOM Loan and is not registered on the MERS(R)System, deliver to and
deposit with the Trustee, or to the Custodian on behalf of the Trustee, the
documents or instruments described in clauses (I)(i), (iii), (iv) and (v)
below, and (5) with respect to each Cooperative Loan and Sharia Mortgage
Loan, the documents and instruments described in clause (II) and clause (III)
below:
(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) The 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 MERS(R)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 or a copy of such Cooperative Lease and
Assignment of Proprietary Lease and copies of such intervening
assignments;
(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 copies 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 or a copy of
each modification, assumption agreement or preferred loan agreement; 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)(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) to the Trustee or to the Custodian on
behalf of the Trustee, 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)(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) 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 to the Custodian
on behalf 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 to the Custodian on behalf of the Trustee 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 applicable person described in
Section 2.01(b), any Assignment, substitute Assignment, Assignment Agreement
and Amendment of Security Instrument or Form UCC-3 or Form UCC-1, as
applicable, (or copy thereof) recorded in connection with this paragraph,
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 to the Custodian on behalf of
the Trustee 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.
In connection with the assignment of any Mortgage Loan registered on
the MERS(R)System, the Company further agrees that it will cause, at the
Company's own expense, within 30 Business Days after the Closing Date, the
MERS(R)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 Servicer 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) Residential Funding hereby assigns to the Trustee its security interest
in and to any Additional Collateral or Pledged Assets, its right to receive
amounts due or to become due in respect of any Additional Collateral or
Pledged Assets pursuant to the related Subservicing Agreement and its rights
as beneficiary under the Surety Bond in respect of any Additional Collateral
Loans. With respect to any Additional Collateral Loan or Pledged Asset Loan,
Residential Funding shall cause to be filed in the appropriate recording
office a UCC-3 statement giving notice of the assignment of the related
security interest to the Trust Fund and shall thereafter cause the timely
filing of all necessary continuation statements with regard to such financing
statements.
(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, any Custodian on behalf of the Trustee 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) The Master Servicer hereby acknowledges the receipt by it of the
Initial Monthly Payment Fund. The Master Servicer shall hold such Initial
Monthly Payment Fund in the Custodial Account and shall include such Initial
Monthly Payment Fund in the Available Distribution Amount for the initial
Distribution Date. Notwithstanding anything herein to the contrary, the
Initial Monthly Payment Fund shall not be an asset of any REMIC. To the
extent that the Initial Monthly Payment Fund constitutes a reserve fund for
federal income tax purposes, (1) it shall be an outside reserve fund and not
an asset of any REMIC, (2) it shall be owned by the Seller and (3) amounts
transferred by any REMIC to the Initial Monthly Payment Fund shall be treated
as transferred to the Seller or any successor, all within the meaning of
Section 1.860G-2(h) of the Treasury Regulations.
(h) The Company agrees that the sale of each Pledged Asset Loan pursuant to
this Agreement will also constitute the assignment, sale, setting-over,
transfer and conveyance to the Trustee, without recourse (but subject to the
Company's covenants, representations and warranties specifically provided
herein), of all of the Company's obligations and all of the Company's right,
title and interest in, to and under, whether now existing or hereafter
acquired as owner of the Mortgage Loan with respect to any and all money,
securities, security entitlements, accounts, general intangibles, payment
intangibles, instruments, documents, deposit accounts, certificates of
deposit, commodities contracts, and other investment property and other
property of whatever kind or description consisting of, arising from or
related to (i) the Assigned Contracts, (ii) all rights, powers and remedies
of the Company as owner of such Mortgage Loan under or in connection with the
Assigned Contracts, whether arising under the terms of such Assigned
Contracts, by statute, at law or in equity, or otherwise arising out of any
default by the Mortgagor under or in connection with the Assigned Contracts,
including all rights to exercise any election or option or to make any
decision or determination or to give or receive any notice, consent, approval
or waiver thereunder, (iii) the Pledged Amounts and all money, securities,
security entitlements, accounts, general intangibles, payment intangibles,
instruments, documents, deposit accounts, certificates of deposit,
commodities contracts, and other investment property and other property of
whatever kind or description and all cash and non-cash proceeds of the sale,
exchange, or redemption of, and all stock or conversion rights, rights to
subscribe, liquidation dividends or preferences, stock dividends, rights to
interest, dividends, earnings, income, rents, issues, profits, interest
payments or other distributions of cash or other property that secures a
Pledged Asset Loan, (iv) all documents, books and records concerning the
foregoing (including all computer programs, tapes, disks and related items
containing any such information) and (v) all insurance proceeds (including
proceeds from the Federal Deposit Insurance Corporation or the Securities
Investor Protection Corporation or any other insurance company) of any of the
foregoing or replacements thereof or substitutions therefor, proceeds of
proceeds and the conversion, voluntary or involuntary, of any thereof. The
foregoing transfer, sale, assignment and conveyance does not constitute and
is not intended to result in the creation, or an assumption by the Trustee,
of any obligation of the Company, or any other person in connection with the
Pledged Assets or under any agreement or instrument relating thereto,
including any obligation to the Mortgagor, other than as owner of the
Mortgage Loan.
Section 2.02. Acceptance by Trustee.
The Trustee acknowledges receipt (or, with respect to Mortgage Loans
subject to a Custodial Agreement, and based solely upon a receipt or
certification executed by the Custodian, receipt by the respective Custodian
as the duly appointed agent of the Trustee) of the documents referred to in
Section 2.01(b)(i) above (except that for purposes of such acknowledgement
only, a Mortgage Note may be endorsed in blank) and declares that it, or the
Custodian as its agent, holds and will hold such documents and the other
documents constituting a part of the Custodial Files delivered to it, or a
Custodian as its agent, and the rights of Residential Funding with respect to
any Pledged Assets, Additional Collateral and the Surety Bond assigned to the
Trustee pursuant to Section 2.01, in trust for the use and benefit of all
present and future Certificateholders. The Trustee or Custodian (the
Custodian being so obligated under a Custodial Agreement) agrees, for the
benefit of Certificateholders, to review each Custodial File delivered to it
pursuant to Section 2.01(b) within 45 days after the Closing Date to
ascertain that all required documents (specifically as set forth in Section
2.01(b)), have been executed and received, and that such documents relate to
the Mortgage Loans identified on the Mortgage Loan Schedule, as supplemented,
that have been conveyed to it, and to deliver to the Trustee a certificate
(the "Interim Certification") to the effect that all documents required to be
delivered pursuant to Section 2.01(b) above have been executed and received
and that such documents relate to the Mortgage Loans identified on the
Mortgage Loan Schedule, except for any exceptions listed on Schedule A
attached to such Interim Certification. Upon delivery of the Custodial Files
by the Company or the Master Servicer, the Trustee shall acknowledge receipt
(or, with respect to Mortgage Loans subject to a Custodial Agreement, and
based solely upon a receipt or certification executed by the Custodian,
receipt by the respective Custodian as the duly appointed agent of the
Trustee) of the documents referred to in Section 2.01(c) above.
If the Custodian, as the Trustee's agent, finds any document or
documents constituting a part of a Custodial File to be missing or defective,
the Trustee shall promptly so notify the Master Servicer and the Company.
Pursuant to Section 2.3 of the Custodial Agreement, the Custodian will notify
the Master Servicer, the Company and the Trustee of any such omission or
defect found by it in respect of any Custodial File held by it in respect of
the items reviewed by it pursuant to the Custodial Agreement. If such
omission or defect materially and adversely affects the interests of the
Certificateholders, the Master Servicer shall promptly notify Residential
Funding of such omission or defect and request Residential Funding to correct
or cure such omission or defect within 60 days from the date the Master
Servicer was notified of such omission or defect and, if Residential Funding
does not correct or cure such omission or defect within such period, require
Residential Funding to purchase such Mortgage Loan from the Trust Fund at its
Purchase Price, within 90 days from the date the Master Servicer was notified
of such omission or defect; 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. The Purchase Price for any
such Mortgage Loan shall be deposited by the Master Servicer in the Custodial
Account maintained by it pursuant to Section 3.07 and, upon receipt by the
Trustee of written notification of such deposit signed by a Servicing
Officer, the Master Servicer, the Trustee or the Custodian, as the case may
be, shall release the contents of any related Mortgage File in its possession
to the owner of such Mortgage Loan (or such owners' designee) and the Trustee
shall execute and deliver such instruments of transfer or assignment prepared
by the Master Servicer, in each case without recourse, as shall be necessary
to vest in Residential Funding or its designee any Mortgage Loan released
pursuant hereto and thereafter such Mortgage Loan shall not be part of the
Trust Fund. It is understood and agreed that the obligation of Residential
Funding to so cure or purchase any Mortgage Loan as to which a material and
adverse defect in or omission of a constituent document exists shall
constitute the sole remedy respecting such defect or omission available to
Certificateholders or the Trustee on behalf of the Certificateholders.
Section 2.03. Representations, Warranties and Covenants
of the Master Servicer and the Company.
(a) The Master Servicer hereby represents and warrants to the Trustee for
the benefit of the Certificateholders that as of the Closing Date:
(i) The Master Servicer is a limited liability company duly organized,
validly existing and in good standing under the laws governing its
creation and existence and is or will be in compliance with the laws of
each state in which any Mortgaged Property is located to the extent
necessary to ensure the enforceability of each Mortgage Loan in
accordance with the terms of this Agreement;
(ii) The execution and delivery of this Agreement by the Master Servicer and
its performance and compliance with the terms of this Agreement will
not violate the Master Servicer's Certificate of Formation or Limited
Liability Company Agreement or constitute a material default (or an
event which, with notice or lapse of time, or both, would constitute a
material default) under, or result in the material breach of, any
material contract, agreement or other instrument to which the Master
Servicer is a party or which may be applicable to the Master Servicer
or any of its assets;
(iii) This Agreement, assuming due authorization, execution and delivery by
the Trustee and the Company, constitutes a valid, legal and binding
obligation of the Master Servicer, enforceable against it in accordance
with the terms hereof subject to applicable bankruptcy, insolvency,
reorganization, moratorium and other laws affecting the enforcement of
creditors' rights generally and to general principles of equity,
regardless of whether such enforcement is considered in a proceeding in
equity or at law;
(iv) The Master Servicer is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal,
state, municipal or governmental agency, which default might have
consequences that would materially and adversely affect the condition
(financial or other) or operations of the Master Servicer or its
properties or might have consequences that would materially adversely
affect its performance hereunder;
(v) No litigation is pending or, to the best of the Master Servicer's
knowledge, threatened against the Master Servicer which would prohibit
its entering into this Agreement or performing its obligations under
this Agreement;
(vi) The Master Servicer will comply in all material respects in the
performance of this Agreement with all reasonable rules and
requirements of each insurer under each Required Insurance Policy;
(vii) No information, certificate of an officer, statement furnished in
writing or report delivered to the Company, any Affiliate of the
Company or the Trustee by the Master Servicer will, to the knowledge of
the Master Servicer, contain any untrue statement of a material fact or
omit a material fact necessary to make the information, certificate,
statement or report not misleading;
(viii) The Master Servicer has examined each existing, and will examine
each new, Subservicing Agreement and is or will be familiar with the
terms thereof. The terms of each existing Subservicing Agreement and
each designated Subservicer are acceptable to the Master Servicer and
any new Subservicing Agreements will comply with the provisions of
Section 3.02; and
(ix) The Master Servicer is a member of MERS in good standing, and will
comply in all material respects with the rules and procedures of MERS
in connection with the servicing of the Mortgage Loans that are
registered with MERS.
It is understood and agreed that the representations and warranties set forth
in this Section 2.03(a) shall survive delivery of the respective Custodial
Files to the Trustee or the Custodian.
Upon discovery by either the Company, the Master Servicer, the Trustee
or the Custodian of a breach of any representation or warranty set forth in
this Section 2.03(a) which 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 (the Custodian
being so obligated under a Custodial Agreement). Within 90 days of its
discovery or its receipt of notice of such breach, the Master Servicer shall
either (i) cure such breach in all material respects or (ii) to the extent
that such breach is with respect to a Mortgage Loan or a related document,
purchase such Mortgage Loan from the Trust Fund at the Purchase Price and in
the manner set forth in Section 2.02; 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. The
obligation of the Master Servicer to cure such breach or to so purchase such
Mortgage Loan shall constitute the sole remedy in respect of a breach of a
representation and warranty set forth in this Section 2.03(a) available to
the Certificateholders or the Trustee on behalf of the Certificateholders.
(b) Representations and warranties relating to the Mortgage Loans are set
forth in Section 2.03(b) of the Series Supplement.
Section 2.04. Representations and Warranties of Residential Funding.
The Company, as assignee of Residential Funding under the Assignment
Agreement, hereby assigns to the Trustee for the benefit of
Certificateholders all of its right, title and interest in respect of the
Assignment Agreement applicable to a Mortgage Loan. Insofar as the
Assignment Agreement relates to the representations and warranties made by
Residential Funding in respect of such Mortgage Loan and any remedies
provided thereunder for any breach of such representations and warranties,
such right, title and interest may be enforced by the Master Servicer on
behalf of the Trustee and the Certificateholders. Upon the discovery by the
Company, the Master Servicer, the Trustee or the Custodian of a breach of any
of the representations and warranties made in the Assignment Agreement
(which, for purposes hereof, will be deemed to include any other cause giving
rise to a repurchase obligation under the Assignment Agreement) in respect of
any Mortgage Loan which materially and adversely affects the interests of the
Certificateholders in such Mortgage Loan, the party discovering such breach
shall give prompt written notice to the other parties (the Custodian being so
obligated under a Custodial Agreement). The Master Servicer shall promptly
notify Residential Funding of such breach and request that Residential
Funding either (i) cure such breach in all material respects within 90 days
from the date the Master Servicer was notified of such breach 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 Residential Funding 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 breach would cause the Mortgage Loan
to be other than a "qualified mortgage" as defined in Section 860G(a)(3) of
the Code, any such cure, repurchase or substitution must occur within 90 days
from the date the breach was discovered. If a breach of the Compliance With
Laws Representation has given rise to the obligation to repurchase or
substitute a Mortgage Loan pursuant to Section 4 of the Assignment Agreement,
then the Master Servicer shall request that Residential Funding pay to the
Trust Fund, concurrently with and in addition to the remedies provided in the
preceding sentence, an amount equal to any liability, penalty or expense that
was actually incurred and paid out of or on behalf of the Trust Fund, and
that directly resulted from such breach, or if incurred and paid by the Trust
Fund thereafter, concurrently with such payment. In the event that
Residential Funding elects to substitute a Qualified Substitute Mortgage Loan
or Loans for a Deleted Mortgage Loan pursuant to this Section 2.04,
Residential Funding shall deliver to the Trustee or the Custodian for the
benefit of the Certificateholders with respect to such Qualified Substitute
Mortgage Loan or Loans, the original Mortgage Note, the Mortgage, an
Assignment of the Mortgage in recordable form, if required pursuant to
Section 2.01, and such other documents and agreements as are required by
Section 2.01, with the Mortgage Note endorsed as required by Section 2.01.
No substitution will be made in any calendar month after the Determination
Date for such month. Monthly Payments due with respect to Qualified
Substitute Mortgage Loans in the month of substitution shall not be part of
the Trust Fund and will be retained by the Master Servicer and remitted by
the Master Servicer to Residential Funding on the next succeeding
Distribution Date. For the month of substitution, distributions to the
Certificateholders will include the Monthly Payment due on a Deleted Mortgage
Loan for such month and thereafter Residential Funding shall be entitled to
retain all amounts received in respect of such Deleted Mortgage Loan. The
Master Servicer shall amend or cause to be amended the Mortgage Loan
Schedule, and, if the Deleted Mortgage Loan was a Discount Mortgage Loan, the
Schedule of Discount Fractions, for the benefit of the Certificateholders to
reflect the removal of such Deleted Mortgage Loan and the substitution of the
Qualified Substitute Mortgage Loan or Loans and the Master Servicer shall
deliver the amended Mortgage Loan Schedule, and, if the Deleted Mortgage Loan
was a Discount Mortgage Loan, the amended Schedule of Discount Fractions, to
the Trustee. Upon such substitution, the Qualified Substitute Mortgage Loan
or Loans shall be subject to the terms of this Agreement and the related
Subservicing Agreement in all respects, Residential Funding shall be deemed
to have made the representations and warranties with respect to the Qualified
Substitute Mortgage Loan contained in the related Assignment Agreement, and
the Company and the Master Servicer shall be deemed to have made with respect
to any Qualified Substitute Mortgage Loan or Loans, as of the date of
substitution, the covenants, representations and warranties set forth in this
Section 2.04, in Section 2.03 hereof and in Section 4 of the Assignment
Agreement, and the Master Servicer shall be obligated to repurchase or
substitute for any Qualified Substitute Mortgage Loan as to which a
Repurchase Event (as defined in the Assignment Agreement) has occurred
pursuant to Section 4 of the Assignment Agreement.
In connection with the substitution of one or more Qualified Substitute
Mortgage Loans for one or more Deleted Mortgage Loans, the Master Servicer
will determine the amount (if any) by which the aggregate principal balance
of all such Qualified Substitute Mortgage Loans as of the date of
substitution is less than the aggregate Stated Principal Balance of all such
Deleted Mortgage Loans (in each case after application of the principal
portion of the Monthly Payments due in the month of substitution that are to
be distributed to the Certificateholders in the month of substitution).
Residential Funding shall deposit the amount of such shortfall into the
Custodial Account on the day of substitution, without any reimbursement
therefor. Residential Funding shall give notice in writing to the Trustee of
such event, which notice shall be accompanied by an Officers' Certificate as
to the calculation of such shortfall and (subject to Section 10.01(f)) by an
Opinion of Counsel to the effect that such substitution will not cause (a)
any federal tax to be imposed on the Trust Fund, including without
limitation, any federal tax imposed on "prohibited transactions" under
Section 860F(a)(1) of the Code or on "contributions after the startup date"
under Section 860G(d)(1) of the Code or (b) any portion of any REMIC to fail
to qualify as such at any time that any Certificate is outstanding.
It is understood and agreed that the obligation of Residential Funding
to cure such breach or purchase, or to substitute for, a Mortgage Loan as to
which such a breach has occurred and is continuing and to make any additional
payments required under the Assignment Agreement in connection with a breach
of the Compliance With Laws Representation shall constitute the sole remedy
respecting such breach available to the Certificateholders or the Trustee on
behalf of Certificateholders. If the Master Servicer is Residential Funding,
then the Trustee shall also have the right to give the notification and
require the purchase or substitution provided for in the second preceding
paragraph in the event of such a breach of a representation or warranty made
by Residential Funding in the Assignment Agreement. In connection with the
purchase of or substitution for any such Mortgage Loan by Residential
Funding, the Trustee shall assign to Residential Funding all of the Trustee's
right, title and interest in respect of the Assignment Agreement applicable
to such Mortgage Loan.
Section 2.05. Execution and Authentication of Certificates/Issuance of
Certificates Evidencing Interests in REMIC I Certificates.
As provided in Section 2.05 of the Series Supplement.
Section 2.06. Conveyance of Uncertificated REMIC I and REMIC II Regular
Interests; Acceptance by the Trustee.
As provided in Section 2.06 of the Series Supplement.
Section 2.07. Issuance of Certificates Evidencing Interests in REMIC II.
As provided in Section 2.07 of the Series Supplement.
Section 2.08. Purposes and Powers of the Trust.
The purpose of the trust, as created hereunder, is to engage in the
following activities:
(a) to sell the Certificates to the Company in exchange for the Mortgage
Loans;
(b) to enter into and perform its obligations under this Agreement;
(c) to engage in those activities that are necessary, suitable or
convenient to accomplish the foregoing or are incidental thereto or connected
therewith; and
(d) subject to compliance with this Agreement, to engage in such other
activities as may be required in connection with conservation of the Trust
Fund and the making of distributions to the Certificateholders.
The trust is hereby authorized to engage in the foregoing
activities. Notwithstanding the provisions of Section 11.01, the trust
shall not engage in any activity other than in connection with the foregoing
or other than as required or authorized by the terms of this Agreement while
any Certificate is outstanding, and this Section 2.08 may not be amended,
without the consent of the Certificateholders evidencing a majority of the
aggregate Voting Rights of the Certificates.
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
Section 3.01. Master Servicer to Act as Servicer.
(a) The Master Servicer shall service and administer the Mortgage Loans in
accordance with the terms of this Agreement and the respective Mortgage Loans
and shall have full power and authority, acting alone or through Subservicers
as provided in Section 3.02, to do any and all things which it may deem
necessary or desirable in connection with such servicing and administration.
Without limiting the generality of the foregoing, the Master Servicer in its
own name or in the name of a Subservicer is hereby authorized and empowered
by the Trustee when the Master Servicer or the Subservicer, as the case may
be, believes it appropriate in its best judgment, to execute and deliver, on
behalf of the Certificateholders and the Trustee or any of them, any and all
instruments of satisfaction or cancellation, or of partial or full release or
discharge, or of consent to assumption or modification in connection with a
proposed conveyance, or of assignment of any Mortgage and Mortgage Note in
connection with the repurchase of a Mortgage Loan and all other comparable
instruments, or with respect to the modification or re-recording of a
Mortgage for the purpose of correcting the Mortgage, the subordination of the
lien of the Mortgage in favor of a public utility company or government
agency or unit with powers of eminent domain, the taking of a deed in lieu of
foreclosure, the commencement, prosecution or completion of judicial or
non-judicial foreclosure, the conveyance of a Mortgaged Property to the
related Insurer, the acquisition of any property acquired by foreclosure or
deed in lieu of foreclosure, or the management, marketing and conveyance of
any property acquired by foreclosure or deed in lieu of foreclosure with
respect to the Mortgage Loans and with respect to the Mortgaged Properties.
The Master Servicer further is authorized and empowered by the Trustee, on
behalf of the Certificateholders and the Trustee, in its own name or in the
name of the Subservicer, when the Master Servicer or the Subservicer, as the
case may be, believes it appropriate in its best judgment to register any
Mortgage Loan on the MERS(R)System, or cause the removal from the registration
of any Mortgage Loan on the MERS(R)System, to execute and deliver, on behalf
of the Trustee and the Certificateholders or any of them, any and all
instruments of assignment and other comparable instruments with respect to
such assignment or re-recording of a Mortgage in the name of MERS, solely as
nominee for the Trustee and its successors and assigns. Any expenses
incurred in connection with the actions described in the preceding sentence
shall be borne by the Master Servicer in accordance with Section 3.16(c),
with no right of reimbursement; provided, that if, as a result of MERS
discontinuing or becoming unable to continue operations in connection with
the MERS System, it becomes necessary to remove any Mortgage Loan from
registration on the MERS System and to arrange for the assignment of the
related Mortgages to the Trustee, then any related expenses shall be
reimbursable to the Master Servicer. Notwithstanding the foregoing, subject
to Section 3.07(a), the Master Servicer shall not permit any modification
with respect to any Mortgage Loan that would both constitute a sale or
exchange of such Mortgage Loan within the meaning of Section 1001 of the Code
and any proposed, temporary or final regulations promulgated thereunder
(other than in connection with a proposed conveyance or assumption of such
Mortgage Loan that is treated as a Principal Prepayment in Full pursuant to
Section 3.13(d) hereof) and cause any REMIC formed under the Series
Supplement to fail to qualify as a REMIC under the Code. The Trustee shall
furnish the Master Servicer with any powers of attorney and other documents
necessary or appropriate to enable the Master Servicer to service and
administer the Mortgage Loans. The Trustee shall not be liable for any
action taken by the Master Servicer or any Subservicer pursuant to such
powers of attorney. In servicing and administering any Nonsubserviced
Mortgage Loan, the Master Servicer shall, to the extent not inconsistent with
this Agreement, comply with the Program Guide as if it were the originator of
such Mortgage Loan and had retained the servicing rights and obligations in
respect thereof. In connection with servicing and administering the Mortgage
Loans, the Master Servicer and any Affiliate of the Master Servicer (i) may
perform services such as appraisals and brokerage services that are not
customarily provided by servicers of mortgage loans, and shall be entitled to
reasonable compensation therefor in accordance with Section 3.10 and (ii)
may, at its own discretion and on behalf of the Trustee, obtain credit
information in the form of a "credit score" from a credit repository.
(b) All costs incurred by the Master Servicer or by Subservicers in
effecting the timely payment of taxes and assessments on the properties
subject to the Mortgage Loans shall not, for the purpose of calculating
monthly distributions to the Certificateholders, be added to the amount owing
under the related Mortgage Loans, notwithstanding that the terms of such
Mortgage Loan so permit, and such costs shall be recoverable to the extent
permitted by Section 3.10(a)(ii).
(c) The Master Servicer may enter into one or more agreements in connection
with the offering of pass-through certificates evidencing interests in one or
more of the Certificates providing for the payment by the Master Servicer of
amounts received by the Master Servicer as servicing compensation hereunder
and required to cover certain Prepayment Interest Shortfalls on the Mortgage
Loans, which payment obligation will thereafter be an obligation of the
Master Servicer hereunder.
Section 3.02. Subservicing Agreements Between Master Servicer and
Subservicers; Enforcement of Subservicers' and Sellers'
Obligations.
(a) The Master Servicer may continue in effect Subservicing Agreements
entered into by Residential Funding and Subservicers prior to the execution
and delivery of this Agreement, and may enter into new Subservicing
Agreements with Subservicers, for the servicing and administration of all or
some of the Mortgage Loans. Each Subservicer of a Mortgage Loan shall be
entitled to receive and retain, as provided in the related Subservicing
Agreement and in Section 3.07, the related Subservicing Fee from payments of
interest received on such Mortgage Loan after payment of all amounts required
to be remitted to the Master Servicer in respect of such Mortgage Loan. For
any Mortgage Loan that is a Nonsubserviced Mortgage Loan, the Master Servicer
shall be entitled to receive and retain an amount equal to the Subservicing
Fee from payments of interest. Unless the context otherwise requires,
references in this Agreement to actions taken or to be taken by the Master
Servicer in servicing the Mortgage Loans include actions taken or to be taken
by a Subservicer on behalf of the Master Servicer. Each Subservicing
Agreement will be upon such terms and conditions as are generally required or
permitted by the Program Guide and are not inconsistent with this Agreement
and as the Master Servicer and the Subservicer have agreed. A representative
form of Subservicing Agreement is attached hereto as Exhibit E. With the
approval of the Master Servicer, a Subservicer may delegate its servicing
obligations to third-party servicers, but such Subservicer will remain
obligated under the related Subservicing Agreement. The Master Servicer and
a Subservicer may enter into amendments thereto or a different form of
Subservicing Agreement, and the form referred to or included in the Program
Guide is merely provided for information and shall not be deemed to limit in
any respect the discretion of the Master Servicer to modify or enter into
different Subservicing Agreements; provided, however, that any such
amendments or different forms shall be consistent with and not violate the
provisions of either this Agreement or the Program Guide in a manner which
would materially and adversely affect the interests of the
Certificateholders. The Program Guide and any other Subservicing Agreement
entered into between the Master Servicer and any Subservicer shall require
the Subservicer to accurately and fully report its borrower credit files to
each of the Credit Repositories in a timely manner.
(b) As part of its servicing activities hereunder, the Master Servicer, for
the benefit of the Trustee and the Certificateholders, shall use its best
reasonable efforts to enforce the obligations of each Subservicer under the
related Subservicing Agreement and of each Seller under the related Seller's
Agreement insofar as the Company's rights with respect to Seller's obligation
has been assigned to the Trustee hereunder, to the extent that the
non-performance of any such Seller's obligation would have a material and
adverse effect on a Mortgage Loan, including, without limitation, the
obligation to purchase a Mortgage Loan on account of defective documentation,
as described in Section 2.02, or on account of a breach of a representation
or warranty, as described in Section 2.04. Such enforcement, including,
without limitation, the legal prosecution of claims, termination of
Subservicing Agreements or Seller's Agreements, as appropriate, and the
pursuit of other appropriate remedies, shall be in such form and carried out
to such an extent and at such time as the Master Servicer would employ in its
good faith business judgment and which are normal and usual in its general
mortgage servicing activities. The Master Servicer shall pay the costs of
such enforcement at its own expense, and shall be reimbursed therefor only
(i) from a general recovery resulting from such enforcement to the extent, if
any, that such recovery exceeds all amounts due in respect of the related
Mortgage Loan or (ii) from a specific recovery of costs, expenses or
attorneys fees against the party against whom such enforcement is directed.
For purposes of clarification only, the parties agree that the foregoing is
not intended to, and does not, limit the ability of the Master Servicer to be
reimbursed for expenses that are incurred in connection with the enforcement
of a Seller's obligations (insofar as the Company's rights with respect to
such Seller's obligations have been assigned to the Trustee hereunder) and
are reimbursable pursuant to Section 3.10(a)(viii).
Section 3.03. Successor Subservicers.
The Master Servicer shall be entitled to terminate any Subservicing
Agreement that may exist in accordance with the terms and conditions of such
Subservicing Agreement and without any limitation by virtue of this
Agreement; provided, however, that in the event of termination of any
Subservicing Agreement by the Master Servicer or the Subservicer, the Master
Servicer shall either act as servicer of the related Mortgage Loan or enter
into a Subservicing Agreement with a successor Subservicer which will be
bound by the terms of the related Subservicing Agreement. If the Master
Servicer or any Affiliate of Residential Funding acts as servicer, it will
not assume liability for the representations and warranties of the
Subservicer which it replaces. If the Master Servicer enters into a
Subservicing Agreement with a successor Subservicer, the Master Servicer
shall use reasonable efforts to have the successor Subservicer assume
liability for the representations and warranties made by the terminated
Subservicer in respect of the related Mortgage Loans and, in the event of any
such assumption by the successor Subservicer, the Master Servicer may, in the
exercise of its business judgment, release the terminated Subservicer from
liability for such representations and warranties.
Section 3.04. Liability of the Master Servicer.
Notwithstanding any Subservicing Agreement, any of the provisions of
this Agreement relating to agreements or arrangements between the Master
Servicer or a Subservicer or reference to actions taken through a Subservicer
or otherwise, the Master Servicer shall remain obligated and liable to the
Trustee and the Certificateholders for the servicing and administering of the
Mortgage Loans in accordance with the provisions of Section 3.01 without
diminution of such obligation or liability by virtue of such Subservicing
Agreements or arrangements or by virtue of indemnification from the
Subservicer or the Company and to the same extent and under the same terms
and conditions as if the Master Servicer alone were servicing and
administering the Mortgage Loans. The Master Servicer shall be entitled to
enter into any agreement with a Subservicer or Seller for indemnification of
the Master Servicer and nothing contained in this Agreement shall be deemed
to limit or modify such indemnification.
Section 3.05. No Contractual Relationship Between Subservicer and
Trustee or Certificateholders.
Any Subservicing Agreement that may be entered into and any other
transactions or services relating to the Mortgage Loans involving a
Subservicer in its capacity as such and not as an originator shall be deemed
to be between the Subservicer and the Master Servicer alone and the Trustee
and the Certificateholders shall not be deemed parties thereto and shall have
no claims, rights, obligations, duties or liabilities with respect to the
Subservicer in its capacity as such except as set forth in Section 3.06. The
foregoing provision shall not in any way limit a Subservicer's obligation to
cure an omission or defect or to repurchase a Mortgage Loan as referred to in
Section 2.02 hereof.
Section 3.06. Assumption or Termination of Subservicing Agreements by
Trustee.
(a) If the Master Servicer shall for any reason no longer be the master
servicer (including by reason of an Event of Default), the Trustee, its
designee or its successor shall thereupon assume all of the rights and
obligations of the Master Servicer under each Subservicing Agreement that may
have been entered into. The Trustee, its designee or the successor servicer
for the Trustee shall be deemed to have assumed all of the Master Servicer's
interest therein and to have replaced the Master Servicer as a party to the
Subservicing Agreement to the same extent as if the Subservicing Agreement
had been assigned to the assuming party except that the Master Servicer shall
not thereby be relieved of any liability or obligations under the
Subservicing Agreement.
(b) The Master Servicer shall, upon request of the Trustee but at the
expense of the Master Servicer, deliver to the assuming party all documents
and records relating to each Subservicing Agreement and the Mortgage Loans
then being serviced and an accounting of amounts collected and held by it and
otherwise use its best efforts to effect the orderly and efficient transfer
of each Subservicing Agreement to the assuming party.
Section 3.07. Collection of Certain Mortgage Loan Payments;
Deposits to Custodial Account.
(a) The Master Servicer shall make reasonable efforts to collect all
payments called for under the terms and provisions of the Mortgage Loans, and
shall, to the extent such procedures shall be consistent with this Agreement
and the terms and provisions of any related Primary Insurance Policy, follow
such collection procedures as it would employ in its good faith business
judgment and which are normal and usual in its general mortgage servicing
activities. Consistent with the foregoing, the Master Servicer may in its
discretion (i) waive any late payment charge or any prepayment charge or
penalty interest in connection with the prepayment of a Mortgage Loan and
(ii) extend the Due Date for payments due on a Mortgage Loan in accordance
with the Program Guide; provided, however, that the Master Servicer shall
first determine that any such waiver or extension will not impair the
coverage of any related Primary Insurance Policy or materially adversely
affect the lien of the related Mortgage. Notwithstanding anything in this
Section to the contrary, the Master Servicer shall not enforce any prepayment
charge to the extent that such enforcement would violate any applicable law.
In the event of any such arrangement, the Master Servicer shall make timely
advances on the related Mortgage Loan during the scheduled period in
accordance with the amortization schedule of such Mortgage Loan without
modification thereof by reason of such arrangements unless otherwise agreed
to by the Holders of the Classes of Certificates affected thereby; provided,
however, that no such extension shall be made if any such advance would be a
Nonrecoverable Advance. Consistent with the terms of this Agreement, the
Master Servicer may also waive, modify or vary any term of any Mortgage Loan
or consent to the postponement of strict compliance with any such term or in
any manner grant indulgence to any Mortgagor if in the Master Servicer's
determination such waiver, modification, postponement or indulgence is not
materially adverse to the interests of the Certificateholders (taking into
account any estimated Realized Loss that might result absent such action);
provided, however, that the Master Servicer may not modify materially or
permit any Subservicer to modify any Mortgage Loan, including without
limitation any modification that would change the Mortgage Rate, forgive the
payment of any principal or interest (unless in connection with the
liquidation of the related Mortgage Loan or except in connection with
prepayments to the extent that such reamortization is not inconsistent with
the terms of the Mortgage Loan), capitalize any amounts owing on the Mortgage
Loan by adding such amount to the outstanding principal balance of the
Mortgage Loan, or extend the final maturity date of such Mortgage Loan,
unless such Mortgage Loan is in default or, in the judgment of the Master
Servicer, such default is reasonably foreseeable; provided, further, that
(1) no such modification shall reduce the interest rate on a Mortgage Loan
below one-half of the Mortgage Rate as in effect on the Cut-off Date, but not
less than the sum of the rates at which the Servicing Fee and the
Subservicing Fee with respect to such Mortgage Loan accrues plus the rate at
which the premium paid to the Certificate Insurer, if any, accrues, (2) the
final maturity date for any Mortgage Loan shall not be extended beyond the
Maturity Date, (3) the Stated Principal Balance of all Reportable Modified
Mortgage Loans subject to Servicing Modifications (measured at the time of
the Servicing Modification and after giving effect to any Servicing
Modification) can be no more than five percent of the aggregate principal
balance of the Mortgage Loans as of the Cut-off Date, unless such limit is
increased from time to time with the consent of the Rating Agencies and the
Certificate Insurer, if any. In addition, any amounts owing on a Mortgage
Loan added to the outstanding principal balance of such Mortgage Loan must be
fully amortized over the remaining term of such Mortgage Loan, and such
amounts may be added to the outstanding principal balance of a Mortgage Loan
only once during the life of such Mortgage Loan. Also, the addition of such
amounts described in the preceding sentence shall be implemented in
accordance with the Program Guide and may be implemented only by Subservicers
that have been approved by the Master Servicer for such purpose. In
connection with any Curtailment of a Mortgage Loan, the Master Servicer, to
the extent not inconsistent with the terms of the Mortgage Note and local law
and practice, may permit the Mortgage Loan to be reamortized such that the
Monthly Payment is recalculated as an amount that will fully amortize the
remaining Stated Principal Balance thereof by the original Maturity Date
based on the original Mortgage Rate; provided, that such re-amortization
shall not be permitted if it would constitute a reissuance of the Mortgage
Loan for federal income tax purposes, except if such reissuance is described
in Treasury Regulation Section 1.860G-2(b)(3).
(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; and
(viii) Any amounts received by the Master Servicer in respect of Pledged
Assets.
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, unless
otherwise set forth in the series supplement, payments or collections in the
nature of prepayment charges or 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. 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) The Master Servicer shall use its best efforts to cause the institution
maintaining the Custodial Account to invest the funds in the Custodial
Account attributable to the Mortgage Loans in Permitted Investments which
shall mature not later than the Certificate Account Deposit Date next
following the date of such investment (with the exception of the Amount Held
for Future Distribution) and which shall not be sold or disposed of prior to
their maturities. All income and gain realized from any such investment
shall be for the benefit of the Master Servicer as additional servicing
compensation and shall be subject to its withdrawal or order from time to
time. The amount of any losses incurred in respect of any such investments
attributable to the investment of amounts in respect of the Mortgage Loans
shall be deposited in the Custodial Account by the Master Servicer out of its
own funds immediately as realized without any right of reimbursement.
(d) The Master Servicer shall give notice to the Trustee and the Company of
any change in the location of the Custodial Account and the location of the
Certificate Account prior to the use thereof.
Section 3.08. Subservicing Accounts; Servicing Accounts.
(a) In those cases where a Subservicer is servicing a Mortgage Loan
pursuant to a Subservicing Agreement, the Master Servicer shall cause the
Subservicer, pursuant to the Subservicing Agreement, to establish and
maintain one or more Subservicing Accounts which shall be an Eligible Account
or, if such account is not an Eligible Account, shall generally satisfy the
requirements of the Program Guide and be otherwise acceptable to the Master
Servicer and each Rating Agency. The Subservicer will be required thereby to
deposit into the Subservicing Account on a daily basis all proceeds of
Mortgage Loans received by the Subservicer, less its Subservicing Fees and
unreimbursed advances and expenses, to the extent permitted by the
Subservicing Agreement. If the Subservicing Account is not an Eligible
Account, the Master Servicer shall be deemed to have received such monies
upon receipt thereof by the Subservicer. The Subservicer shall not be
required to deposit in the Subservicing Account payments or collections in
the nature of prepayment charges or late charges or assumption fees. On or
before the date specified in the Program Guide, but in no event later than
the Determination Date, the Master Servicer shall cause the Subservicer,
pursuant to the Subservicing Agreement, to remit to the Master Servicer for
deposit in the Custodial Account all funds held in the Subservicing Account
with respect to each Mortgage Loan serviced by such Subservicer that are
required to be remitted to the Master Servicer. The Subservicer will also be
required, pursuant to the Subservicing Agreement, to advance on such
scheduled date of remittance amounts equal to any scheduled monthly
installments of principal and interest less its Subservicing Fees on any
Mortgage Loans for which payment was not received by the Subservicer. This
obligation to advance with respect to each Mortgage Loan will continue up to
and including the first of the month following the date on which the related
Mortgaged Property is sold at a foreclosure sale or is acquired by the Trust
Fund by deed in lieu of foreclosure or otherwise. All such advances received
by the Master Servicer shall be deposited promptly by it in the Custodial
Account.
(b) The Subservicer may also be required, pursuant to the Subservicing
Agreement, to remit to the Master Servicer for deposit in the Custodial
Account interest at the Adjusted Mortgage Rate (or Modified Net Mortgage Rate
plus the rate per annum at which the Servicing Fee accrues in the case of a
Modified Mortgage Loan) on any Curtailment received by such Subservicer in
respect of a Mortgage Loan from the related Mortgagor during any month that
is to be applied by the Subservicer to reduce the unpaid principal balance of
the related Mortgage Loan as of the first day of such month, from the date of
application of such Curtailment to the first day of the following month. Any
amounts paid by a Subservicer pursuant to the preceding sentence shall be for
the benefit of the Master Servicer as additional servicing compensation and
shall be subject to its withdrawal or order from time to time pursuant to
Sections 3.10(a)(iv) and (v).
(c) In addition to the Custodial Account and the Certificate Account, the
Master Servicer shall for any Nonsubserviced Mortgage Loan, and shall cause
the Subservicers for Subserviced Mortgage Loans to, establish and maintain
one or more Servicing Accounts and deposit and retain therein all collections
from the Mortgagors (or advances from Subservicers) for the payment of taxes,
assessments, hazard insurance premiums, Primary Insurance Policy premiums, if
applicable, or comparable items for the account of the Mortgagors. Each
Servicing Account shall satisfy the requirements for a Subservicing Account
and, to the extent permitted by the Program Guide or as is otherwise
acceptable to the Master Servicer, may also function as a Subservicing
Account. Withdrawals of amounts related to the Mortgage Loans from the
Servicing Accounts may be made only to effect timely payment of taxes,
assessments, hazard insurance premiums, Primary Insurance Policy premiums, if
applicable, or comparable items, to reimburse the Master Servicer or
Subservicer out of related collections for any payments made pursuant to
Sections 3.11 (with respect to the Primary Insurance Policy) and 3.12(a)
(with respect to hazard insurance), to refund to any Mortgagors any sums as
may be determined to be overages, to pay interest, if required, to Mortgagors
on balances in the Servicing Account or to clear and terminate the Servicing
Account at the termination of this Agreement in accordance with Section 9.01
or in accordance with the Program Guide. As part of its servicing duties,
the Master Servicer shall, and the Subservicers will, pursuant to the
Subservicing Agreements, be required to pay to the Mortgagors interest on
funds in this account to the extent required by law.
(d) The Master Servicer shall advance the payments referred to in the
preceding subsection that are not timely paid by the Mortgagors or advanced
by the Subservicers on the date when the tax, premium or other cost for which
such payment is intended is due, but the Master Servicer shall be required so
to advance only to the extent that such advances, in the good faith judgment
of the Master Servicer, will be recoverable by the Master Servicer out of
Insurance Proceeds, Liquidation Proceeds or otherwise.
Section 3.09. Access to Certain Documentation and
Information Regarding the Mortgage Loans.
If compliance with this Section 3.09 shall make any Class of
Certificates legal for investment by federally insured savings and loan
associations, the Master Servicer shall provide, or cause the Subservicers to
provide, to the Trustee, the Office of Thrift Supervision or the FDIC and the
supervisory agents and examiners thereof access to the documentation
regarding the Mortgage Loans required by applicable regulations of the Office
of Thrift Supervision, such access being afforded without charge but only
upon reasonable request and during normal business hours at the offices
designated by the Master Servicer. The Master Servicer shall permit such
representatives to photocopy any such documentation and shall provide
equipment for that purpose at a charge reasonably approximating the cost of
such photocopying to the Master Servicer.
Section 3.10. Permitted Withdrawals from the Custodial Account.
(a) The Master Servicer may, from time to time as provided herein, make
withdrawals from the Custodial Account of amounts on deposit therein pursuant
to Section 3.07 that are attributable to the Mortgage Loans for the following
purposes:
(i) to make deposits into the Certificate Account in the amounts and in the
manner provided for in Section 4.01;
(ii) to reimburse itself or the related Subservicer for previously
unreimbursed Advances, Servicing Advances or other expenses made
pursuant to Sections 3.01, 3.07(a), 3.08, 3.11, 3.12(a), 3.14 and 4.04
or otherwise reimbursable pursuant to the terms of this Agreement, such
withdrawal right being limited to amounts received on the related
Mortgage Loans (including, for this purpose, REO Proceeds, Insurance
Proceeds, Liquidation Proceeds and proceeds from the purchase of a
Mortgage Loan pursuant to Section 2.02, 2.03, 2.04 or 4.07) which
represent (A) Late Collections of Monthly Payments for which any such
advance was made in the case of Subservicer Advances or Advances
pursuant to Section 4.04 and (B) recoveries of amounts in respect of
which such advances were made in the case of Servicing Advances;
(iii) to pay to itself or the related Subservicer (if not previously retained
by such Subservicer) out of each payment received by the Master
Servicer on account of interest on a Mortgage Loan as contemplated by
Sections 3.14 and 3.16, an amount equal to that remaining portion of
any such payment as to interest (but not in excess of the Servicing Fee
and the Subservicing Fee, if not previously retained) which, when
deducted, will result in the remaining amount of such interest being
interest at the Net Mortgage Rate (or Modified Net Mortgage Rate in the
case of a Modified Mortgage Loan) on the amount specified in the
amortization schedule of the related Mortgage Loan as the principal
balance thereof at the beginning of the period respecting which such
interest was paid after giving effect to any previous Curtailments;
(iv) to pay to itself as additional servicing compensation any interest or
investment income earned on funds and other property deposited in or
credited to the Custodial Account that it is entitled to withdraw
pursuant to Section 3.07(c);
(v) to pay to itself as additional servicing compensation any Foreclosure
Profits, any amounts remitted by Subservicers as interest in respect of
Curtailments pursuant to Section 3.08(b), and any amounts paid by a
Mortgagor in connection with a Principal Prepayment in Full in respect
of interest for any period during the calendar month in which such
Principal Prepayment in Full is to be distributed to the
Certificateholders;
(vi) to pay to itself, a Subservicer, a Seller, Residential Funding, the
Company or any other appropriate Person, as the case may be, with
respect to each Mortgage Loan or property acquired in respect thereof
that has been purchased or otherwise transferred pursuant to Section
2.02, 2.03, 2.04, 4.07 or 9.01, all amounts received thereon and not
required to be distributed to the Certificateholders as of the date on
which the related Stated Principal Balance or Purchase Price is
determined;
(vii) to reimburse itself or the related Subservicer for any Nonrecoverable
Advance or Advances in the manner and to the extent provided in
subsection (c) below, and any Advance or Servicing Advance made in
connection with a modified Mortgage Loan that is in default or, in the
judgment of the Master Servicer, default is reasonably foreseeable
pursuant to Section 3.07(a), to the extent the amount of the Advance
or Servicing Advance was added to the Stated Principal Balance of the
Mortgage Loan in a prior calendar month, or any Advance reimbursable to
the Master Servicer pursuant to Section 4.02(a);
(viii) to reimburse itself or the Company for expenses incurred by and
reimbursable to it or the Company pursuant to Sections 3.01(a), 3.11,
3.13, 3.14(c), 6.03, 10.01 or otherwise, or in connection with
enforcing, in accordance with this Agreement, any repurchase,
substitution or indemnification obligation of any Seller (other than an
Affiliate of the Company) pursuant to the related Seller's Agreement;
(ix) to reimburse itself for Servicing Advances expended by it (a) pursuant
to Section 3.14 in good faith in connection with the restoration of
property damaged by an Uninsured Cause, and (b) in connection with the
liquidation of a Mortgage Loan or disposition of an REO Property to the
extent not otherwise reimbursed pursuant to clause (ii) or (viii)
above; and
(x) to withdraw any amount deposited in the Custodial Account that was not
required to be deposited therein pursuant to Section 3.07.
(b) Since, in connection with withdrawals pursuant to clauses (ii), (iii),
(v) and (vi), the Master Servicer's entitlement thereto is limited to
collections or other recoveries on the related Mortgage Loan, the Master
Servicer shall keep and maintain separate accounting, on a Mortgage Loan by
Mortgage Loan basis, for the purpose of justifying any withdrawal from the
Custodial Account pursuant to such clauses.
(c) The Master Servicer shall be entitled to reimburse itself or the
related Subservicer for any advance made in respect of a Mortgage Loan that
the Master Servicer determines to be a Nonrecoverable Advance by withdrawal
from the Custodial Account of amounts on deposit therein attributable to the
Mortgage Loans on any Certificate Account Deposit Date succeeding the date of
such determination. Such right of reimbursement in respect of a
Nonrecoverable Advance relating to an Advance pursuant to Section 4.04 on any
such Certificate Account Deposit Date shall be limited to an amount not
exceeding the portion of such Advance previously paid to Certificateholders
(and not theretofore reimbursed to the Master Servicer or the related
Subservicer).
Section 3.11. Maintenance of the Primary Insurance
Policies; Collections Thereunder.
(a) The Master Servicer shall not take, or permit any Subservicer to take,
any action which would result in non-coverage under any applicable Primary
Insurance Policy of any loss which, but for the actions of the Master
Servicer or Subservicer, would have been covered thereunder. To the extent
coverage is available, the Master Servicer shall keep or cause to be kept in
full force and effect each such Primary Insurance Policy until the principal
balance of the related Mortgage Loan secured by a Mortgaged Property is
reduced to 80% or less of the Appraised Value in the case of such a Mortgage
Loan having a Loan-to-Value Ratio at origination in excess of 80%, provided
that such Primary Insurance Policy was in place as of the Cut-off Date and
the Company had knowledge of such Primary Insurance Policy. The Master
Servicer shall be entitled to cancel or permit the discontinuation of any
Primary Insurance Policy as to any Mortgage Loan, if the Stated Principal
Balance of the Mortgage Loan is reduced below an amount equal to 80% of the
appraised value of the related Mortgaged Property as determined in any
appraisal thereof after the Closing Date, or if the Loan-to-Value Ratio is
reduced below 80% as a result of principal payments on the Mortgage Loan
after the Closing Date. In the event that the Company gains knowledge that
as of the Closing Date, a Mortgage Loan had a Loan-to-Value Ratio at
origination in excess of 80% and is not the subject of a Primary Insurance
Policy (and was not included in any exception to the representation in
Section 2.03(b)(iv)) and that such Mortgage Loan has a current Loan-to-Value
Ratio in excess of 80% then the Master Servicer shall use its reasonable
efforts to obtain and maintain a Primary Insurance Policy to the extent that
such a policy is obtainable at a reasonable price. The Master Servicer shall
not cancel or refuse to renew any such Primary Insurance Policy applicable to
a Nonsubserviced Mortgage Loan, or consent to any Subservicer canceling or
refusing to renew any such Primary Insurance Policy applicable to a Mortgage
Loan subserviced by it, that is in effect at the date of the initial issuance
of the Certificates and is required to be kept in force hereunder unless the
replacement Primary Insurance Policy for such canceled or non-renewed policy
is maintained with an insurer whose claims-paying ability is acceptable to
each Rating Agency for mortgage pass-through certificates having a rating
equal to or better than the lower of the then-current rating or the rating
assigned to the Certificates as of the Closing Date by such Rating Agency.
(b) In connection with its activities as administrator and servicer of the
Mortgage Loans, the Master Servicer agrees to present or to cause the related
Subservicer to present, on behalf of the Master Servicer, the Subservicer, if
any, the Trustee and Certificateholders, claims to the related Insurer under
any Primary Insurance Policies, in a timely manner in accordance with such
policies, and, in this regard, to take or cause to be taken such reasonable
action as shall be necessary to permit recovery under any Primary Insurance
Policies respecting defaulted Mortgage Loans. Pursuant to Section 3.07, any
Insurance Proceeds collected by or remitted to the Master Servicer under any
Primary Insurance Policies shall be deposited in the Custodial Account,
subject to withdrawal pursuant to Section 3.10.
Section 3.12. Maintenance of Fire Insurance and
Omissions and Fidelity Coverage.
(a) The Master Servicer shall cause to be maintained for each Mortgage Loan
(other than a Cooperative Loan) fire insurance with extended coverage in an
amount which is equal to the lesser of the principal balance owing on such
Mortgage Loan or 100 percent of the insurable value of the improvements;
provided, however, that such coverage may not be less than the minimum amount
required to fully compensate for any loss or damage on a replacement cost
basis. To the extent it may do so without breaching the related Subservicing
Agreement, the Master Servicer shall replace any Subservicer that does not
cause such insurance, to the extent it is available, to be maintained. The
Master Servicer shall also cause to be maintained on property acquired upon
foreclosure, or deed in lieu of foreclosure, of any Mortgage Loan (other than
a Cooperative Loan), fire insurance with extended coverage in an amount which
is at least equal to the amount necessary to avoid the application of any
co-insurance clause contained in the related hazard insurance policy.
Pursuant to Section 3.07, any amounts collected by the Master Servicer under
any such policies (other than amounts to be applied to the restoration or
repair of the related Mortgaged Property or property thus acquired or amounts
released to the Mortgagor in accordance with the Master Servicer's normal
servicing procedures) shall be deposited in the Custodial Account, subject to
withdrawal pursuant to Section 3.10. Any cost incurred by the Master
Servicer in maintaining any such insurance shall not, for the purpose of
calculating monthly distributions to the Certificateholders, be added to the
amount owing under the Mortgage Loan, notwithstanding that the terms of the
Mortgage Loan so permit. Such costs shall be recoverable by the Master
Servicer out of related late payments by the Mortgagor or out of Insurance
Proceeds and Liquidation Proceeds to the extent permitted by Section 3.10.
It is understood and agreed that no earthquake or other additional insurance
is to be required of any Mortgagor or maintained on property acquired in
respect of a Mortgage Loan other than pursuant to such applicable laws and
regulations as shall at any time be in force and as shall require such
additional insurance. Whenever the improvements securing a Mortgage Loan
(other than a Cooperative Loan) are located at the time of origination of
such Mortgage Loan in a federally designated special flood hazard area, the
Master Servicer shall cause flood insurance (to the extent available) to be
maintained in respect thereof. Such flood insurance shall be in an amount
equal to the lesser of (i) the amount required to compensate for any loss or
damage to the Mortgaged Property on a replacement cost basis and (ii) the
maximum amount of such insurance available for the related Mortgaged Property
under the national flood insurance program (assuming that the area in which
such Mortgaged Property is located is participating in such program).
If the Master Servicer shall obtain and maintain a blanket fire
insurance policy with extended coverage insuring against hazard losses on all
of the Mortgage Loans, it shall conclusively be deemed to have satisfied its
obligations as set forth in the first sentence of this Section 3.12(a), it
being understood and agreed that such policy may contain a deductible clause,
in which case the Master Servicer shall, in the event that there shall not
have been maintained on the related Mortgaged Property a policy complying
with the first sentence of this Section 3.12(a) and there shall have been a
loss which would have been covered by such policy, deposit in the Certificate
Account the amount not otherwise payable under the blanket policy because of
such deductible clause. Any such deposit by the Master Servicer shall be
made on the Certificate Account Deposit Date next preceding the Distribution
Date which occurs in the month following the month in which payments under
any such policy would have been deposited in the Custodial Account. In
connection with its activities as administrator and servicer of the Mortgage
Loans, the Master Servicer agrees to present, on behalf of itself, the
Trustee and the Certificateholders, claims under any such blanket policy.
(b) The Master Servicer shall obtain and maintain at its own expense and
keep in full force and effect throughout the term of this Agreement a blanket
fidelity bond and an errors and omissions insurance policy covering the
Master Servicer's officers and employees and other persons acting on behalf
of the Master Servicer in connection with its activities under this
Agreement. The amount of coverage shall be at least equal to the coverage
that would be required by Xxxxxx Xxx or Xxxxxxx Mac, whichever is greater,
with respect to the Master Servicer if the Master Servicer were servicing and
administering the Mortgage Loans for Xxxxxx Mae or Xxxxxxx Mac. In the event
that any such bond or policy ceases to be in effect, the Master Servicer
shall obtain a comparable replacement bond or policy from an issuer or
insurer, as the case may be, meeting the requirements, if any, of the Program
Guide and acceptable to the Company. Coverage of the Master Servicer under a
policy or bond obtained by an Affiliate of the Master Servicer and providing
the coverage required by this Section 3.12(b) shall satisfy the requirements
of this Section 3.12(b).
Section 3.13. Enforcement of Due-on-Sale Clauses; Assumption and
Modification Agreements; Certain Assignments.
(a) When any Mortgaged Property is conveyed by the Mortgagor, the Master
Servicer or Subservicer, to the extent it has knowledge of such conveyance,
shall enforce any due-on-sale clause contained in any Mortgage Note or
Mortgage, to the extent permitted under applicable law and governmental
regulations, but only to the extent that such enforcement will not adversely
affect or jeopardize coverage under any Required Insurance Policy.
Notwithstanding the foregoing:
(i) the Master Servicer shall not be deemed to be in default under this
Section 3.13(a) by reason of any transfer or assumption which the
Master Servicer is restricted by law from preventing; and
(ii) if the Master Servicer determines that it is reasonably likely that any
Mortgagor will bring, or if any Mortgagor does bring, legal action to
declare invalid or otherwise avoid enforcement of a due-on-sale clause
contained in any Mortgage Note or Mortgage, the Master Servicer shall
not be required to enforce the due-on-sale clause or to contest such
action.
(b) Subject to the Master Servicer's duty to enforce any due-on-sale clause
to the extent set forth in Section 3.13(a), in any case in which a Mortgaged
Property is to be conveyed to a Person by a Mortgagor, and such Person is to
enter into an assumption or modification agreement or supplement to the
Mortgage Note or Mortgage which requires the signature of the Trustee, or if
an instrument of release signed by the Trustee is required releasing the
Mortgagor from liability on the Mortgage Loan, the Master Servicer is
authorized, subject to the requirements of the sentence next following, to
execute and deliver, on behalf of the Trustee, the assumption agreement with
the Person to whom the Mortgaged Property is to be conveyed and such
modification agreement or supplement to the Mortgage Note or Mortgage or
other instruments as are reasonable or necessary to carry out the terms of
the Mortgage Note or Mortgage or otherwise to comply with any applicable laws
regarding assumptions or the transfer of the Mortgaged Property to such
Person; provided, however, none of such terms and requirements shall either
(i) both (A) constitute a "significant modification" effecting an exchange or
reissuance of such Mortgage Loan under the REMIC Provisions and (B) cause any
portion of any REMIC formed under the Series Supplement to fail to qualify as
a REMIC under the Code or (subject to Section 10.01(f)), result in the
imposition of any tax on "prohibited transactions" or (ii) constitute
"contributions" after the start-up date under the REMIC Provisions. The
Master Servicer shall execute and deliver such documents only if it
reasonably determines that (i) its execution and delivery thereof will not
conflict with or violate any terms of this Agreement or cause the unpaid
balance and interest on the Mortgage Loan to be uncollectible in whole or in
part, (ii) any required consents of insurers under any Required Insurance
Policies have been obtained and (iii) subsequent to the closing of the
transaction involving the assumption or transfer (A) the Mortgage Loan will
continue to be secured by a first mortgage lien pursuant to the terms of the
Mortgage, (B) such transaction will not adversely affect the coverage under
any Required Insurance Policies, (C) the Mortgage Loan will fully amortize
over the remaining term thereof, (D) no material term of the Mortgage Loan
(including the interest rate on the Mortgage Loan) will be altered nor will
the term of the Mortgage Loan be changed and (E) if the seller/transferor of
the Mortgaged Property is to be released from liability on the Mortgage Loan,
such release will not (based on the Master Servicer's or Subservicer's good
faith determination) adversely affect the collectability of the Mortgage
Loan. Upon receipt of appropriate instructions from the Master Servicer in
accordance with the foregoing, the Trustee shall execute any necessary
instruments for such assumption or substitution of liability as directed in
writing by the Master Servicer. Upon the closing of the transactions
contemplated by such documents, the Master Servicer shall cause the originals
or true and correct copies of the assumption agreement, the release (if any),
or the modification or supplement to the Mortgage Note or Mortgage to be
delivered to the Trustee or the Custodian and deposited with the Mortgage
File for such Mortgage Loan. Any fee collected by the Master Servicer or
such related Subservicer for entering into an assumption or substitution of
liability agreement will be retained by the Master Servicer or such
Subservicer as additional servicing compensation.
(c) The Master Servicer or the related Subservicer, as the case may be,
shall be entitled to approve a request from a Mortgagor for a partial release
of the related Mortgaged Property, the granting of an easement thereon in
favor of another Person, any alteration or demolition of the related
Mortgaged Property (or, with respect to a Cooperative Loan, the related
Cooperative Apartment) without any right of reimbursement or other similar
matters if it has determined, exercising its good faith business judgment in
the same manner as it would if it were the owner of the related Mortgage
Loan, that the security for, and the timely and full collectability of, such
Mortgage Loan would not be adversely affected thereby and that any portion of
any REMIC formed under the Series Supplement would not fail to continue to
qualify as a REMIC under the Code as a result thereof and (subject to Section
10.01(f)) that no tax on "prohibited transactions" or "contributions" after
the startup day would be imposed on any such REMIC as a result thereof. Any
fee collected by the Master Servicer or the related Subservicer for
processing such a request will be retained by the Master Servicer or such
Subservicer as additional servicing compensation.
(d) Subject to any other applicable terms and conditions of this Agreement,
the Trustee and Master Servicer shall be entitled to approve an assignment in
lieu of satisfaction with respect to any Mortgage Loan, provided the obligee
with respect to such Mortgage Loan following such proposed assignment
provides the Trustee and Master Servicer with a "Lender Certification for
Assignment of Mortgage Loan" in the form attached hereto as Exhibit M, in
form and substance satisfactory to the Trustee and Master Servicer, providing
the following: (i) that the substance of the assignment is, and is intended
to be, a refinancing of such Mortgage; (ii) that the Mortgage Loan following
the proposed assignment will have a rate of interest at least 0.25 percent
below or above the rate of interest on such Mortgage Loan prior to such
proposed assignment; and (iii) that such assignment is at the request of the
borrower under the related Mortgage Loan. Upon approval of an assignment in
lieu of satisfaction with respect to any Mortgage Loan, the Master Servicer
shall receive cash in an amount equal to the unpaid principal balance of and
accrued interest on such Mortgage Loan and the Master Servicer shall treat
such amount as a Principal Prepayment in Full with respect to such Mortgage
Loan for all purposes hereof.
Section 3.14. Realization Upon Defaulted Mortgage Loans.
(a) The Master Servicer shall foreclose upon or otherwise comparably
convert (which may include an REO Acquisition) the ownership of properties
securing such of the Mortgage Loans as come into and continue in default and
as to which no satisfactory arrangements can be made for collection of
delinquent payments pursuant to Section 3.07. Alternatively, the Master
Servicer may take other actions in respect of a defaulted Mortgage Loan,
which may include (i) accepting a short sale (a payoff of the Mortgage Loan
for an amount less than the total amount contractually owed in order to
facilitate a sale of the Mortgaged Property by the Mortgagor) or permitting a
short refinancing (a payoff of the Mortgage Loan for an amount less than the
total amount contractually owed in order to facilitate refinancing
transactions by the Mortgagor not involving a sale of the Mortgaged
Property), (ii) arranging for a repayment plan or (iii) agreeing to a
modification in accordance with Section 3.07. In connection with such
foreclosure or other conversion, the Master Servicer shall, consistent with
Section 3.11, follow such practices and procedures as it shall deem necessary
or advisable, as shall be normal and usual in its general mortgage servicing
activities and as shall be required or permitted by the Program Guide;
provided that the Master Servicer shall not be liable in any respect
hereunder if the Master Servicer is acting in connection with any such
foreclosure or other conversion in a manner that is consistent with the
provisions of this Agreement. The Master Servicer, however, shall not be
required to expend its own funds or incur other reimbursable charges in
connection with any foreclosure, or attempted foreclosure which is not
completed, or towards the restoration of any property unless it shall
determine (i) that such restoration and/or foreclosure will increase the
proceeds of liquidation of the Mortgage Loan to Holders of Certificates of
one or more Classes after reimbursement to itself for such expenses or
charges and (ii) that such expenses or charges will be recoverable to it
through Liquidation Proceeds, Insurance Proceeds, or REO Proceeds (respecting
which it shall have priority for purposes of withdrawals from the Custodial
Account pursuant to Section 3.10, whether or not such expenses and charges
are actually recoverable from related Liquidation Proceeds, Insurance
Proceeds or REO Proceeds). In the event of such a determination by the
Master Servicer pursuant to this Section 3.14(a), the Master Servicer shall
be entitled to reimbursement of such amounts pursuant to Section 3.10.
In addition to the foregoing, the Master Servicer shall use its
best reasonable efforts to realize upon any Additional Collateral for such of
the Additional Collateral Loans as come into and continue in default and as
to which no satisfactory arrangements can be made for collection of
delinquent payments pursuant to Section 3.07; provided that the Master
Servicer shall not, on behalf of the Trustee, obtain title to any such
Additional Collateral as a result of or in lieu of the disposition thereof or
otherwise; and provided further that (i) the Master Servicer shall not
proceed with respect to such Additional Collateral in any manner that would
impair the ability to recover against the related Mortgaged Property, and
(ii) the Master Servicer shall proceed with any REO Acquisition in a manner
that preserves the ability to apply the proceeds of such Additional
Collateral against amounts owed under the defaulted Mortgage Loan. Any
proceeds realized from such Additional Collateral (other than amounts to be
released to the Mortgagor or the related guarantor in accordance with
procedures that the Master Servicer would follow in servicing loans held for
its own account, subject to the terms and conditions of the related Mortgage
and Mortgage Note and to the terms and conditions of any security agreement,
guarantee agreement, mortgage or other agreement governing the disposition of
the proceeds of such Additional Collateral) shall be deposited in the
Custodial Account, subject to withdrawal pursuant to Section 3.10. Any other
payment received by the Master Servicer in respect of such Additional
Collateral shall be deposited in the Custodial Account subject to withdrawal
pursuant to Section 3.10.
For so long as the Master Servicer is the Master Servicer under
the Credit Support Pledge Agreement, the Master Servicer shall perform its
obligations under the Credit Support Pledge Agreement in accordance with such
Agreement and in a manner that is in the best interests of the
Certificateholders. Further, the Master Servicer shall use its best
reasonable efforts to realize upon any Pledged Assets for such of the Pledged
Asset Loans as come into and continue in default and as to which no
satisfactory arrangements can be made for collection of delinquent payments
pursuant to Section 3.07; provided that the Master Servicer shall not, on
behalf of the Trustee, obtain title to any such Pledged Assets as a result of
or in lieu of the disposition thereof or otherwise; and provided further that
(i) the Master Servicer shall not proceed with respect to such Pledged Assets
in any manner that would impair the ability to recover against the related
Mortgaged Property, and (ii) the Master Servicer shall proceed with any REO
Acquisition in a manner that preserves the ability to apply the proceeds of
such Pledged Assets against amounts owed under the defaulted Mortgage Loan.
Any proceeds realized from such Pledged Assets (other than amounts to be
released to the Mortgagor or the related guarantor in accordance with
procedures that the Master Servicer would follow in servicing loans held for
its own account, subject to the terms and conditions of the related Mortgage
and Mortgage Note and to the terms and conditions of any security agreement,
guarantee agreement, mortgage or other agreement governing the disposition of
the proceeds of such Pledged Assets) shall be deposited in the Custodial
Account, subject to withdrawal pursuant to Section 3.10. Any other payment
received by the Master Servicer in respect of such Pledged Assets shall be
deposited in the Custodial Account subject to withdrawal pursuant to Section
3.10.
Concurrently with the foregoing, the Master Servicer may pursue
any remedies that may be available in connection with a breach of a
representation and warranty with respect to any such Mortgage Loan in
accordance with Sections 2.03 and 2.04. However, the Master Servicer is not
required to continue to pursue both foreclosure (or similar remedies) with
respect to the Mortgage Loans and remedies in connection with a breach of a
representation and warranty if the Master Servicer determines in its
reasonable discretion that one such remedy is more likely to result in a
greater recovery as to the Mortgage Loan. Upon the occurrence of a Cash
Liquidation or REO Disposition, following the deposit in the Custodial
Account of all Insurance Proceeds, Liquidation Proceeds and other payments
and recoveries referred to in the definition of "Cash Liquidation" or "REO
Disposition," as applicable, upon receipt by the Trustee of written
notification of such deposit signed by a Servicing Officer, the Trustee or
the Custodian, as the case may be, shall release to the Master Servicer the
related Custodial File and the Trustee shall execute and deliver such
instruments of transfer or assignment prepared by the Master Servicer, in
each case without recourse, as shall be necessary to vest in the Master
Servicer or its designee, as the case may be, the related Mortgage Loan, and
thereafter such Mortgage Loan shall not be part of the Trust Fund.
Notwithstanding the foregoing or any other provision of this Agreement, in
the Master Servicer's sole discretion with respect to any defaulted Mortgage
Loan or REO Property as to either of the following provisions, (i) a Cash
Liquidation or REO Disposition may be deemed to have occurred if
substantially all amounts expected by the Master Servicer to be received in
connection with the related defaulted Mortgage Loan or REO Property have been
received, and (ii) for purposes of determining the amount of any Liquidation
Proceeds, Insurance Proceeds, REO Proceeds or any other unscheduled
collections or the amount of any Realized Loss, the Master Servicer may take
into account minimal amounts of additional receipts expected to be received
or any estimated additional liquidation expenses expected to be incurred in
connection with the related defaulted Mortgage Loan or REO Property.
(b) If title to any Mortgaged Property is acquired by the Trust Fund as an
REO Property by foreclosure or by deed in lieu of foreclosure, the deed or
certificate of sale shall be issued to the Trustee or to its nominee on
behalf of Certificateholders. Notwithstanding any such acquisition of title
and cancellation of the related Mortgage Loan, such REO Property shall
(except as otherwise expressly provided herein) be considered to be an
Outstanding Mortgage Loan held in the Trust Fund until such time as the REO
Property shall be sold. Consistent with the foregoing for purposes of all
calculations hereunder so long as such REO Property shall be considered to be
an Outstanding Mortgage Loan it shall be assumed that, notwithstanding that
the indebtedness evidenced by the related Mortgage Note shall have been
discharged, such Mortgage Note and the related amortization schedule in
effect at the time of any such acquisition of title (after giving effect to
any previous Curtailments and before any adjustment thereto by reason of any
bankruptcy or similar proceeding or any moratorium or similar waiver or grace
period) remain in effect.
(c) If the Trust Fund acquires any REO Property as aforesaid or otherwise
in connection with a default or imminent default on a Mortgage Loan, the
Master Servicer on behalf of the Trust Fund shall dispose of such REO
Property as soon as practicable, giving due consideration to the interests of
the Certificateholders, but in all cases within three full years after the
taxable year of its acquisition by the Trust Fund for purposes of Section
860G(a)(8) of the Code (or such shorter period as may be necessary under
applicable state (including any state in which such property is located) law
to maintain the status of any portion of any REMIC formed under the Series
Supplement as a REMIC under applicable state law and avoid taxes resulting
from such property failing to be foreclosure property under applicable state
law) or, at the expense of the Trust Fund, request, more than 60 days before
the day on which such grace period would otherwise expire, an extension of
such grace period unless the Master Servicer (subject to Section 10.01(f))
obtains for the Trustee an Opinion of Counsel, addressed to the Trustee and
the Master Servicer, to the effect that the holding by the Trust Fund of such
REO Property subsequent to such period will not result in the imposition of
taxes on "prohibited transactions" as defined in Section 860F of the Code or
cause any REMIC formed under the Series Supplement to fail to qualify as a
REMIC (for federal (or any applicable State or local) income tax purposes) at
any time that any Certificates are outstanding, in which case the Trust Fund
may continue to hold such REO Property (subject to any conditions contained
in such Opinion of Counsel). The Master Servicer shall be entitled to be
reimbursed from the Custodial Account for any costs incurred in obtaining
such Opinion of Counsel, as provided in Section 3.10. Notwithstanding any
other provision of this Agreement, no REO Property acquired by the Trust Fund
shall be rented (or allowed to continue to be rented) or otherwise used by or
on behalf of the Trust Fund in such a manner or pursuant to any terms that
would (i) cause such REO Property to fail to qualify as "foreclosure
property" within the meaning of Section 860G(a)(8) of the Code or (ii)
subject the Trust Fund to the imposition of any federal income taxes on the
income earned from such REO Property, including any taxes imposed by reason
of Section 860G(c) of the Code, unless the Master Servicer has agreed to
indemnify and hold harmless the Trust Fund with respect to the imposition of
any such taxes.
(d) The proceeds of any Cash Liquidation, REO Disposition or purchase or
repurchase of any Mortgage Loan pursuant to the terms of this Agreement, as
well as any recovery resulting from a collection of Liquidation Proceeds,
Insurance Proceeds or REO Proceeds, will be applied in the following order of
priority: first, to reimburse the Master Servicer or the related Subservicer
in accordance with Section 3.10(a)(ii); second, to the Certificateholders to
the extent of accrued and unpaid interest on the Mortgage Loan, and any
related REO Imputed Interest, at the Net Mortgage Rate (or the Modified Net
Mortgage Rate in the case of a Modified Mortgage Loan) to the Due Date prior
to the Distribution Date on which such amounts are to be distributed; third,
to the Certificateholders as a recovery of principal on the Mortgage Loan (or
REO Property); fourth, to all Servicing Fees and Subservicing Fees payable
therefrom (and the Master Servicer and the Subservicer shall have no claims
for any deficiencies with respect to such fees which result from the
foregoing allocation); and fifth, to Foreclosure Profits.
(e) In the event of a default on a Mortgage Loan one or more of whose
obligors is not a United States Person, in connection with any foreclosure or
acquisition of a deed in lieu of foreclosure (together, "foreclosure") in
respect of such Mortgage Loan, the Master Servicer will cause compliance with
the provisions of Treasury Regulation Section 1.1445-2(d)(3) (or any
successor thereto) necessary to assure that no withholding tax obligation
arises with respect to the proceeds of such foreclosure except to the extent,
if any, that proceeds of such foreclosure are required to be remitted to the
obligors on such Mortgage Loan.
Section 3.15. Trustee to Cooperate; Release of Custodial Files.
(a) Upon becoming aware of the payment in full of any Mortgage Loan, or
upon the receipt by the Master Servicer of a notification that payment in
full will be escrowed in a manner customary for such purposes, the Master
Servicer will immediately notify the Trustee (if it holds the related
Custodial File) or the Custodian by a certification of a Servicing Officer
(which certification shall include a statement to the effect that all amounts
received or to be received in connection with such payment which are required
to be deposited in the Custodial Account pursuant to Section 3.07 have been
or will be so deposited), substantially in one of the forms attached hereto
as Exhibit F, or, in the case of the Custodian, an electronic request in a
form acceptable to the Custodian, requesting delivery to it of the Custodial
File. Within two Business Days of receipt of such certification and request,
the Trustee shall release, or cause the Custodian to release, the related
Custodial File to the Master Servicer. The Master Servicer is authorized to
execute and deliver to the Mortgagor the request for reconveyance, deed of
reconveyance or release or satisfaction of mortgage or such instrument
releasing the lien of the Mortgage, together with the Mortgage Note with, as
appropriate, written evidence of cancellation thereon and to cause the
removal from the registration on the MERS(R)System of such Mortgage and to
execute and deliver, on behalf of the Trustee and the Certificateholders or
any of them, any and all instruments of satisfaction or cancellation or of
partial or full release. No expenses incurred in connection with any
instrument of satisfaction or deed of reconveyance shall be chargeable to the
Custodial Account or the Certificate Account.
(b) From time to time as is appropriate for the servicing or foreclosure of
any Mortgage Loan, the Master Servicer shall deliver to the Custodian, with a
copy to the Trustee, a certificate of a Servicing Officer substantially in
one of the forms attached as Exhibit F hereto, or, in the case of the
Custodian, an electronic request in a form acceptable to the Custodian,
requesting that possession of all, or any document constituting part of, the
Custodial File be released to the Master Servicer and certifying as to the
reason for such release and that such release will not invalidate any
insurance coverage provided in respect of the Mortgage Loan under any
Required Insurance Policy. Upon receipt of the foregoing, the Trustee shall
deliver, or cause the Custodian to deliver, the Custodial File or any
document therein to the Master Servicer. The Master Servicer shall cause
each Custodial File or any document therein so released to be returned to the
Trustee, or the Custodian as agent for the Trustee when the need therefor by
the Master Servicer no longer exists, unless (i) the Mortgage Loan has been
liquidated and the Liquidation Proceeds relating to the Mortgage Loan have
been deposited in the Custodial Account or (ii) the Custodial File or such
document has been delivered directly or through a Subservicer to an attorney,
or to a public trustee or other public official as required by law, for
purposes of initiating or pursuing legal action or other proceedings for the
foreclosure of the Mortgaged Property either judicially or non-judicially,
and the Master Servicer has delivered directly or through a Subservicer to
the Trustee a certificate of a Servicing Officer certifying as to the name
and address of the Person to which such Custodial File or such document was
delivered and the purpose or purposes of such delivery. In the event of the
liquidation of a Mortgage Loan, the Trustee shall deliver the Request for
Release with respect thereto to the Master Servicer upon deposit of the
related Liquidation Proceeds in the Custodial Account.
(c) The Trustee or the Master Servicer on the Trustee's behalf shall
execute and deliver to the Master Servicer, if necessary, any court
pleadings, requests for trustee's sale or other documents necessary to the
foreclosure or trustee's sale in respect of a Mortgaged Property or to any
legal action brought to obtain judgment against any Mortgagor on the Mortgage
Note or Mortgage or to obtain a deficiency judgment, or to enforce any other
remedies or rights provided by the Mortgage Note or Mortgage or otherwise
available at law or in equity. Together with such documents or pleadings (if
signed by the Trustee), the Master Servicer shall deliver to the Trustee a
certificate of a Servicing Officer requesting that such pleadings or
documents be executed by the Trustee and certifying as to the reason such
documents or pleadings are required and that the execution and delivery
thereof by the Trustee will not invalidate any insurance coverage under any
Required Insurance Policy or invalidate or otherwise affect the lien of the
Mortgage, except for the termination of such a lien upon completion of the
foreclosure or trustee's sale.
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 accounted for on a Mortgage Loan-by-Mortgage Loan basis. 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 prepayment charges,
assumption fees, late payment charges, investment income on amounts in the
Custodial Account or the Certificate Account or otherwise shall be retained
by the Master Servicer or the Subservicer to the extent provided herein,
subject to clause (e) below.
(c) The Master Servicer shall be required to pay, or cause to be paid, all
expenses incurred by it in connection with its servicing activities hereunder
(including payment of premiums for the Primary Insurance Policies, if any, to
the extent such premiums are not required to be paid by the related
Mortgagors, and the fees and expenses of the Trustee and any co-trustee (as
provided in Section 8.05) and the fees and expense of the Custodian) and
shall not be entitled to reimbursement therefor except as specifically
provided in Sections 3.10 and 3.14.
(d) The Master Servicer's right to receive servicing compensation may not
be transferred in whole or in part except in connection with the transfer of
all of its responsibilities and obligations of the Master Servicer under this
Agreement.
(e) Notwithstanding any other provision herein, the amount of servicing
compensation that the Master Servicer shall be entitled to receive for its
activities hereunder for the period ending on each Distribution Date shall be
reduced (but not below zero) by an amount equal to Compensating Interest (if
any) for such Distribution Date. Such reduction shall be applied during such
period as follows: first, to any Servicing Fee or Subservicing Fee to which
the Master Servicer is entitled pursuant to Section 3.10(a)(iii), and second,
to any income or gain realized from any investment of funds held in the
Custodial Account or the Certificate Account to which the Master Servicer is
entitled pursuant to Sections 3.07(c) or 4.01(b), respectively. In making
such reduction, the Master Servicer (i) will not withdraw from the Custodial
Account any such amount representing all or a portion of the Servicing Fee to
which it is entitled pursuant to Section 3.10(a)(iii), and (ii) will not
withdraw from the Custodial Account or Certificate Account any such amount to
which it is entitled pursuant to Section 3.07(c) or 4.01(b).
Section 3.17. Reports to the Trustee and the Company.
Not later than fifteen days after it receives a written request from
the Trustee or the Company, the Master Servicer shall forward to the Trustee
and the Company a statement, certified by a Servicing Officer, setting forth
the status of the Custodial Account as of the close of business on the
immediately preceding Distribution Date as it relates to the Mortgage Loans
and showing, for the period covered by such statement, the aggregate of
deposits in or withdrawals from the Custodial Account in respect of the
Mortgage Loans for each category of deposit specified in Section 3.07 and
each category of withdrawal specified in Section 3.10.
Section 3.18. Annual Statement as to Compliance and Servicing Assessment.
The Master Servicer will deliver to the Company and the Trustee on or
before the earlier of (a) March 31 of each year or (b) with respect to any
calendar year during which the Company's annual report on Form 10-K is
required to be filed in accordance with the Exchange Act and the rules and
regulations of the Commission, the date on which the annual report on Form
10-K is required to be filed in accordance with the Exchange Act and the
rules and regulations of the Commission, (i) a servicing assessment as
described in Section 4.03(f)(ii) and (ii) a servicer compliance statement,
signed by an authorized officer of the Master Servicer, as described in Items
1122(a), 1122(b) and 1123 of Regulation AB, to the effect that:
(A) A review of the Master Servicer's activities during the reporting
period and of its performance under this Agreement has been made under such
officer's supervision.
(B) To the best of such officer's knowledge, based on such review,
the Master Servicer has fulfilled all of its obligations under this Agreement
in all material respects throughout the reporting period or, if there has
been a failure to fulfill any such obligation in any material respect,
specifying each such failure known to such officer and the nature and status
thereof.
The Master Servicer shall use commercially reasonable efforts to obtain
from all other parties participating in the servicing function any additional
certifications required under Item 1122 and Item 1123 of Regulation AB to the
extent required to be included in a Report on Form 10-K; provided, however,
that a failure to obtain such certifications shall not be a breach of the
Master Servicer's duties hereunder if any such party fails to deliver such a
certification.
Section 3.19. Annual Independent Public Accountants' Servicing Report.
On or before the earlier of (a) March 31 of each year or (b) with
respect to any calendar year during which the Company's annual report on Form
10-K is required to be filed in accordance with the Exchange Act and the
rules and regulations of the Commission, the date on which the annual report
on Form 10-K is required to be filed in accordance with the Exchange Act and
the rules and regulations of the Commission, the Master Servicer at its
expense shall cause a firm of independent public accountants, which shall be
members of the American Institute of Certified Public Accountants, to furnish
to the Company and the Trustee the attestation required under Item 1122(b) of
Regulation AB. In rendering such statement, such firm may rely, as to
matters relating to the direct servicing of mortgage loans by Subservicers,
upon comparable statements for examinations conducted by independent public
accountants substantially in accordance with standards established by the
American Institute of Certified Public Accountants (rendered within one year
of such statement) with respect to such Subservicers.
Section 3.20. Rights of the Company in Respect of the Master Servicer.
The Master Servicer shall afford the Company, upon reasonable notice,
during normal business hours access to all records maintained by the Master
Servicer in respect of its rights and obligations hereunder and access to
officers of the Master Servicer responsible for such obligations. Upon
request, the Master Servicer shall furnish the Company with its most recent
financial statements and such other information as the Master Servicer
possesses regarding its business, affairs, property and condition, financial
or otherwise. The Master Servicer shall also cooperate with all reasonable
requests for information including, but not limited to, notices, tapes and
copies of files, regarding itself, the Mortgage Loans or the Certificates
from any Person or Persons identified by the Company or Residential Funding.
The Company may, but is not obligated to, enforce the obligations of the
Master Servicer hereunder and may, but is not obligated to, perform, or cause
a designee to perform, any defaulted obligation of the Master Servicer
hereunder or exercise the rights of the Master Servicer hereunder; provided
that the Master Servicer shall not be relieved of any of its obligations
hereunder by virtue of such performance by the Company or its designee. The
Company shall not have any responsibility or liability for any action or
failure to act by the Master Servicer and is not obligated to supervise the
performance of the Master Servicer under this Agreement or otherwise.
Section 3.21. Administration of Buydown Funds
(a) With respect to any Buydown Mortgage Loan, the Subservicer has
deposited Buydown Funds in an account that satisfies the requirements for a
Subservicing Account (the "Buydown Account"). The Master Servicer shall
cause the Subservicing Agreement to require that upon receipt from the
Mortgagor of the amount due on a Due Date for each Buydown Mortgage Loan, the
Subservicer will withdraw from the Buydown Account the predetermined amount
that, when added to the amount due on such date from the Mortgagor, equals
the full Monthly Payment and transmit that amount in accordance with the
terms of the Subservicing Agreement to the Master Servicer together with the
related payment made by the Mortgagor or advanced by the Subservicer.
(b) If the Mortgagor on a Buydown Mortgage Loan prepays such loan in its
entirety during the period (the "Buydown Period") when Buydown Funds are
required to be applied to such Buydown Mortgage Loan, the Subservicer shall
be required to withdraw from the Buydown Account and remit any Buydown Funds
remaining in the Buydown Account in accordance with the related buydown
agreement. The amount of Buydown Funds which may be remitted in accordance
with the related buydown agreement may reduce the amount required to be paid
by the Mortgagor to fully prepay the related Mortgage Loan. If the Mortgagor
on a Buydown Mortgage Loan defaults on such Mortgage Loan during the Buydown
Period and the property securing such Buydown Mortgage Loan is sold in the
liquidation thereof (either by the Master Servicer or the insurer under any
related Primary Insurance Policy), the Subservicer shall be required to
withdraw from the Buydown Account the Buydown Funds for such Buydown Mortgage
Loan still held in the Buydown Account and remit the same to the Master
Servicer in accordance with the terms of the Subservicing Agreement for
deposit in the Custodial Account or, if instructed by the Master Servicer,
pay to the insurer under any related Primary Insurance Policy if the
Mortgaged Property is transferred to such insurer and such insurer pays all
of the loss incurred in respect of such default. Any amount so remitted
pursuant to the preceding sentence will be deemed to reduce the amount owed
on the Mortgage Loan.
Section 3.22. Advance Facility
(a) The Master Servicer is hereby authorized to enter into a financing or
other facility (any such arrangement, an "Advance Facility") under which (1)
the Master Servicer sells, assigns or pledges to another Person (an
"Advancing Person") the Master Servicer's rights under this Agreement to be
reimbursed for any Advances or Servicing Advances and/or (2) an Advancing
Person agrees to fund some or all Advances and/or Servicing Advances required
to be made by the Master Servicer pursuant to this Agreement. No consent of
the Depositor, the Trustee, the Certificateholders or any other party shall
be required before the Master Servicer may enter into an Advance Facility.
Notwithstanding the existence of any Advance Facility under which an
Advancing Person agrees to fund Advances and/or Servicing Advances on the
Master Servicer's behalf, the Master Servicer shall remain obligated
pursuant to this Agreement to make Advances and Servicing Advances pursuant
to and as required by this Agreement. If the Master Servicer enters into an
Advance Facility, and for so long as an Advancing Person remains entitled to
receive reimbursement for any Advances including Nonrecoverable Advances
("Advance Reimbursement Amounts") and/or Servicing Advances including
Nonrecoverable Advances ("Servicing Advance Reimbursement Amounts" and
together with Advance Reimbursement Amounts, "Reimbursement Amounts") (in
each case to the extent such type of Reimbursement Amount is included in the
Advance Facility), as applicable, pursuant to this Agreement, then the Master
Servicer shall identify such Reimbursement Amounts consistent with the
reimbursement rights set forth in Section 3.10(a)(ii) and (vii) and remit
such Reimbursement Amounts in accordance with this Section 3.22 or otherwise
in accordance with the documentation establishing the Advance Facility to
such Advancing Person or to a trustee, agent or custodian (an "Advance
Facility Trustee") designated by such Advancing Person in an Advance Facility
Notice described below in Section 3.22(b). Notwithstanding the foregoing, if
so required pursuant to the terms of the Advance Facility, the Master
Servicer may direct, and if so directed in writing the Trustee is hereby
authorized to and shall pay to the Advance Facility Trustee the Reimbursement
Amounts identified pursuant to the preceding sentence. An Advancing Person
whose obligations hereunder are limited to the funding of Advances and/or
Servicing Advances shall not be required to meet the qualifications of a
Master Servicer or a Subservicer pursuant to Section 3.02(a) or 6.02(c)
hereof and shall not be deemed to be a Subservicer under this Agreement.
Notwithstanding anything to the contrary herein, in no event shall Advance
Reimbursement Amounts or Servicing Advance Reimbursement Amounts be included
in the Available Distribution Amount or distributed to Certificateholders.
(b) If the Master Servicer enters into an Advance Facility and makes the
election set forth in Section 3.22(a), the Master Servicer and the related
Advancing Person shall deliver to the Certificate Insurer and the Trustee a
written notice and payment instruction (an "Advance Facility Notice"),
providing the Trustee with written payment instructions as to where to remit
Advance Reimbursement Amounts and/or Servicing Advance Reimbursement Amounts
(each to the extent such type of Reimbursement Amount is included within the
Advance Facility) on subsequent Distribution Dates. The payment instruction
shall require the applicable Reimbursement Amounts to be distributed to the
Advancing Person or to an Advance Facility Trustee designated in the Advance
Facility Notice. An Advance Facility Notice may only be terminated by the
joint written direction of the Master Servicer and the related Advancing
Person (and any related Advance Facility Trustee). The Master Servicer shall
provide the Certificate Insurer, if any, with notice of any termination of
any Advance Facility pursuant to this Section 3.22(b).
(c) Reimbursement Amounts shall consist solely of amounts in respect of
Advances and/or Servicing Advances made with respect to the Mortgage Loans
for which the Master Servicer would be permitted to reimburse itself in
accordance with Section 3.10(a)(ii) and (vii) hereof, assuming the Master
Servicer or the Advancing Person had made the related Advance(s) and/or
Servicing Advance(s). Notwithstanding the foregoing, except with respect to
reimbursement of Nonrecoverable Advances as set forth in Section 3.10(c) of
this Agreement, no Person shall be entitled to reimbursement from funds held
in the Collection Account for future distribution to Certificateholders
pursuant to this Agreement. Neither the Company nor the Trustee shall have
any duty or liability with respect to the calculation of any Reimbursement
Amount, nor shall the Company or the Trustee have any responsibility to track
or monitor the administration of the Advance Facility or have any
responsibility to track, monitor or verify the payment of Reimbursement
Amounts to the related Advancing Person or Advance Facility Trustee. The
Master Servicer shall maintain and provide to any Successor Master Servicer a
detailed accounting on a loan-by-loan basis as to amounts advanced by, sold,
pledged or assigned to, and reimbursed to any Advancing Person. The Successor
Master Servicer shall be entitled to rely on any such information provided by
the Master Servicer and the Successor Master Servicer shall not be liable for
any errors in such information.
(d) Upon the direction of and at the expense of the Master Servicer, the
Trustee agrees to execute such acknowledgments, certificates and other
documents reasonably satisfactory to the Trustee provided by the Master
Servicer recognizing the interests of any Advancing Person or Advance
Facility Trustee in such Reimbursement Amounts as the Master Servicer may
cause to be made subject to Advance Facilities pursuant to this Section 3.22.
(e) Reimbursement Amounts collected with respect to each Mortgage Loan
shall be allocated to outstanding unreimbursed Advances or Servicing Advances
(as the case may be) made with respect to that Mortgage Loan on a "first-in,
first out" ("FIFO") basis, subject to the qualifications set forth below:
(i) Any successor Master Servicer to Residential Funding (a
"Successor Master Servicer") and the Advancing Person or Advance
Facility Trustee shall be required to apply all amounts available in
accordance with this Section 3.22(e) to the reimbursement of Advances
and Servicing Advances in the manner provided for herein; provided,
however, that after the succession of a Successor Master Servicer, (A)
to the extent that any Advances or Servicing Advances with respect to
any particular Mortgage Loan are reimbursed from payments or
recoveries, if any, from the related Mortgagor, and Liquidation
Proceeds or Insurance Proceeds, if any, with respect to that Mortgage
Loan, reimbursement shall be made, first, to the Advancing Person or
Advance Facility Trustee in respect of Advances and/or Servicing
Advances related to that Mortgage Loan to the extent of the interest of
the Advancing Person or Advance Facility Trustee in such Advances
and/or Servicing Advances, second to the Master Servicer in respect of
Advances and/or Servicing Advances related to that Mortgage Loan in
excess of those in which the Advancing Person or Advance Facility
Trustee Person has an interest, and third, to the Successor Master
Servicer in respect of any other Advances and/or Servicing Advances
related to that Mortgage Loan, from such sources as and when collected,
and (B) reimbursements of Advances and Servicing Advances that are
Nonrecoverable Advances shall be made pro rata to the Advancing Person
or Advance Facility Trustee, on the one hand, and any such Successor
Master Servicer, on the other hand, on the basis of the respective
aggregate outstanding unreimbursed Advances and Servicing Advances that
are Nonrecoverable Advances owed to the Advancing Person, Advance
Facility Trustee or Master Servicer pursuant to this Agreement, on the
one hand, and any such Successor Master Servicer, on the other hand,
and without regard to the date on which any such Advances or Servicing
Advances shall have been made. In the event that, as a result of the
FIFO allocation made pursuant to this Section 3.22(e), some or all of a
Reimbursement Amount paid to the Advancing Person or Advance Facility
Trustee relates to Advances or Servicing Advances that were made by a
Person other than Residential Funding or the Advancing Person or
Advance Facility Trustee, then the Advancing Person or Advance Facility
Trustee shall be required to remit any portion of such Reimbursement
Amount to the Person entitled to such portion of such Reimbursement
Amount. Without limiting the generality of the foregoing, Residential
Funding shall remain entitled to be reimbursed by the Advancing Person
or Advance Facility Trustee for all Advances and Servicing Advances
funded by Residential Funding to the extent the related Reimbursement
Amount(s) have not been assigned or pledged to an Advancing Person or
Advance Facility Trustee. The documentation establishing any Advance
Facility shall require Residential Funding to provide to the related
Advancing Person or Advance Facility Trustee loan by loan information
with respect to each Reimbursement Amount distributed to such Advancing
Person or Advance Facility Trustee on each date of remittance thereof
to such Advancing Person or Advance Facility Trustee, to enable the
Advancing Person or Advance Facility Trustee to make the FIFO
allocation of each Reimbursement Amount with respect to each Mortgage
Loan.
(ii) By way of illustration, and not by way of limiting the
generality of the foregoing, if the Master Servicer resigns or is
terminated at a time when the Master Servicer is a party to an Advance
Facility, and is replaced by a Successor Master Servicer, and the
Successor Master Servicer directly funds Advances or Servicing Advances
with respect to a Mortgage Loan and does not assign or pledge the
related Reimbursement Amounts to the related Advancing Person or
Advance Facility Trustee, then all payments and recoveries received
from the related Mortgagor or received in the form of Liquidation
Proceeds with respect to such Mortgage Loan (including Insurance
Proceeds collected in connection with a liquidation of such Mortgage
Loan) will be allocated first to the Advancing Person or Advance
Facility Trustee until the related Reimbursement Amounts attributable
to such Mortgage Loan that are owed to the Master Servicer and the
Advancing Person, which were made prior to any Advances or Servicing
Advances made by the Successor Master Servicer, have been reimbursed in
full, at which point the Successor Master Servicer shall be entitled to
retain all related Reimbursement Amounts subsequently collected with
respect to that Mortgage Loan pursuant to Section 3.10 of this
Agreement. To the extent that the Advances or Servicing Advances are
Nonrecoverable Advances to be reimbursed on an aggregate basis pursuant
to Section 3.10 of this Agreement, the reimbursement paid in this
manner will be made pro rata to the Advancing Person or Advance
Facility Trustee, on the one hand, and the Successor Master Servicer,
on the other hand, as described in clause (i)(B) above.
(f) The Master Servicer shall remain entitled to be reimbursed for
all Advances and Servicing Advances funded by the Master Servicer to the
extent the related rights to be reimbursed therefor have not been sold,
assigned or pledged to an Advancing Person.
(g) Any amendment to this Section 3.22 or to any other provision of
this Agreement that may be necessary or appropriate to effect the terms of an
Advance Facility as described generally in this Section 3.22, including
amendments to add provisions relating to a successor Master Servicer, may be
entered into by the Trustee, the Certificate Insurer, Company and the Master
Servicer without the consent of any Certificateholder, with written
confirmation from each Rating Agency that the amendment will not result in
the reduction of the ratings on any class of the Certificates below the
lesser of the then current or original ratings on such Certificates, and an
opinion of counsel as required by Section 11.01(c), notwithstanding anything
to the contrary in Section 11.01 of or elsewhere in this Agreement.
(h) Any rights of set-off that the Trust Fund, the Trustee, the
Company, any Successor Master Servicer or any other Person might otherwise
have against the Master Servicer under this Agreement shall not attach to any
rights to be reimbursed for Advances or Servicing Advances that have been
sold, transferred, pledged, conveyed or assigned to any Advancing Person.
(i) At any time when an Advancing Person shall have ceased funding
Advances and/or Servicing Advances (as the case may be) and the Advancing
Person or related Advance Facility Trustee shall have received Reimbursement
Amounts sufficient in the aggregate to reimburse all Advances and/or
Servicing Advances (as the case may be) the right to reimbursement for which
were assigned to the Advancing Person, then upon the delivery of a written
notice signed by the Advancing Person and the Master Servicer or its
successor or assign) to the Trustee terminating the Advance Facility Notice
(the "Notice of Facility Termination"), the Master Servicer or its Successor
Master Servicer shall again be entitled to withdraw and retain the related
Reimbursement Amounts from the Custodial Account pursuant to Section 3.10.
(j) After delivery of any Advance Facility Notice, and until any such
Advance Facility Notice has been terminated by a Notice of Facility
Termination, this Section 3.22 may not be amended or otherwise modified
without the prior written consent of the related Advancing Person.
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 and (v) all other amounts constituting the Available
Distribution Amount for the immediately succeeding Distribution Date.
(b) The Trustee shall, upon written request from the Master Servicer,
invest or cause the institution maintaining the Certificate Account to invest
the funds in the Certificate Account in Permitted Investments designated in
the name of the Trustee for the benefit of the Certificateholders, which
shall mature or be payable on demand not later than the Business Day next
preceding the Distribution Date next following the date of such investment
(except that (i) any investment in the institution with which the Certificate
Account is maintained may mature or be payable on demand on such Distribution
Date and (ii) any other investment may mature or be payable on demand on such
Distribution Date if the Trustee shall advance funds on such Distribution
Date to the Certificate Account in the amount payable on such investment on
such Distribution Date, pending receipt thereof to the extent necessary to
make distributions on the Certificates) and shall not be sold or disposed of
prior to maturity. Subject to Section 3.16(e), all income and gain realized
from any such investment shall be for the benefit of the Master Servicer and
shall be subject to its withdrawal or order from time to time. The amount of
any losses incurred in respect of any such investments shall be deposited in
the Certificate Account by the Master Servicer out of its own funds
immediately as realized without any right of reimbursement. The Trustee or
its Affiliates are permitted to receive compensation that could be deemed to
be in the Trustee's economic self-interest for (i) serving as investment
adviser (with respect to investments made through its Affiliates),
administrator, shareholder servicing agent, custodian or sub-custodian with
respect to certain of the Permitted Investments, (ii) using Affiliates to
effect transactions in certain Permitted Investments and (iii) effecting
transactions in certain Permitted Investments.
Section 4.02. Distributions.
As provided in Section 4.02 of the Series Supplement.
Section 4.03. Statements to Certificateholders; Statements to Rating
Agencies; Exchange Act Reporting.
(a) Concurrently with each distribution charged to the Certificate Account
and with respect to each Distribution Date the Master Servicer shall forward
to the Trustee and the Trustee shall either forward by mail or make available
to each Holder and the Company, via the Trustee's internet website, a
statement (and at its option, any additional files containing the same
information in an alternative format) setting forth information as to each
Class of Certificates, the Mortgage Pool and, if the Mortgage Pool is
comprised of two or more Loan Groups, each Loan Group, to the extent
applicable. This statement will include the information set forth in an
exhibit to the Series Supplement. The Trustee shall mail to each Holder that
requests a paper copy by telephone a paper copy via first class mail. The
Trustee may modify the distribution procedures set forth in this Section
provided that such procedures are no less convenient for the
Certificateholders. The Trustee shall provide prior notification to the
Company, the Master Servicer and the Certificateholders regarding any such
modification. In addition, the Master Servicer shall provide to any manager
of a trust fund consisting of some or all of the Certificates, upon
reasonable request, such additional information as is reasonably obtainable
by the Master Servicer at no additional expense to the Master Servicer.
Also, at the request of a Rating Agency, the Master Servicer shall provide
the information relating to the Reportable Modified Mortgage Loans
substantially in the form attached hereto as Exhibit Q to such Rating Agency
within a reasonable period of time; provided, however, that the Master
Servicer shall not be required to provide such information more than four
times in a calendar year to any Rating Agency.
(b) Within a reasonable period of time after it receives a written request
from a Holder of a Certificate, other than a Class R Certificate, the Master
Servicer shall prepare, or cause to be prepared, and shall forward, or cause
to be forwarded, to each Person who at any time during the calendar year was
the Holder of a Certificate, other than a Class R Certificate, a statement
containing the information set forth in clauses (v) and (vi) of the exhibit
to the Series Supplement referred to in subsection (a) above aggregated for
such calendar year or applicable portion thereof during which such Person was
a Certificateholder. Such obligation of the Master Servicer shall be deemed
to have been satisfied to the extent that substantially comparable
information shall be provided by the Master Servicer pursuant to any
requirements of the Code.
(c) Within a reasonable period of time after it receives a written request
from a Holder of a Class R Certificate, the Master Servicer shall prepare, or
cause to be prepared, and shall forward, or cause to be forwarded, to each
Person who at any time during the calendar year was the Holder of a Class R
Certificate, a statement containing the applicable distribution information
provided pursuant to this Section 4.03 aggregated for such calendar year or
applicable portion thereof during which such Person was the Holder of a Class
R Certificate. Such obligation of the Master Servicer shall be deemed to
have been satisfied to the extent that substantially comparable information
shall be provided by the Master Servicer pursuant to any requirements of the
Code.
(d) Upon the written request of any Certificateholder, the Master Servicer,
as soon as reasonably practicable, shall provide the requesting
Certificateholder with such information as is necessary and appropriate, in
the Master Servicer's sole discretion, for purposes of satisfying applicable
reporting requirements under Rule 144A.
(e) The Master Servicer shall, on behalf of the Company and in respect of
the Trust Fund, sign and cause to be filed with the Commission any periodic
reports required to be filed under the provisions of the Exchange Act, and
the rules and regulations of the Commission thereunder including, without
limitation, reports on Form 10-K, Form 10-D and Form 8-K. In connection with
the preparation and filing of such periodic reports, the Trustee shall timely
provide to the Master Servicer (I) a list of Certificateholders as shown on
the Certificate Register as of the end of each calendar year, (II) copies of
all pleadings, other legal process and any other documents relating to any
claims, charges or complaints involving the Trustee, as trustee hereunder, or
the Trust Fund that are received by a Responsible Officer of the Trustee,
(III) notice of all matters that, to the actual knowledge of a Responsible
Officer of the Trustee, have been submitted to a vote of the
Certificateholders, other than those matters that have been submitted to a
vote of the Certificateholders at the request of the Company or the Master
Servicer, and (IV) notice of any failure of the Trustee to make any
distribution to the Certificateholders as required pursuant to the Series
Supplement. Neither the Master Servicer nor the Trustee shall have any
liability with respect to the Master Servicer's failure to properly prepare
or file such periodic reports resulting from or relating to the Master
Servicer's inability or failure to obtain any information not resulting from
the Master Servicer's own negligence or willful misconduct.
(f) Any Form 10-K filed with the Commission in connection with this
Section 4.03 shall include, with respect to the Certificates relating to such
10-K:
(i) A certification, signed by the senior officer in charge of the
servicing functions of the Master Servicer, in the form attached as
Exhibit O hereto or such other form as may be required or permitted by
the Commission (the "Form 10-K Certification"), in compliance with
Rules 13a-14 and 15d-14 under the Exchange Act and any additional
directives of the Commission.
(ii) A report regarding its assessment of compliance during the preceding
calendar year with all applicable servicing criteria set forth in
relevant Commission regulations with respect to mortgage-backed
securities transactions taken as a whole involving the Master Servicer
that are backed by the same types of assets as those backing the
certificates, as well as similar reports on assessment of compliance
received from other parties participating in the servicing function as
required by relevant Commission regulations, as described in Item
1122(a) of Regulation AB. The Master Servicer shall obtain from all
other parties participating in the servicing function any required
assessments.
(iii) With respect to each assessment report described immediately above, a
report by a registered public accounting firm that attests to, and
reports on, the assessment made by the asserting party, as set forth in
relevant Commission regulations, as described in Regulation 1122(b) of
Regulation AB and Section 3.19.
(iv) The servicer compliance certificate required to be delivered pursuant
Section 3.18.
(g) In connection with the Form 10-K Certification, the Trustee shall
provide the Master Servicer with a back-up certification substantially in the
form attached hereto as Exhibit P.
(h) This Section 4.03 may be amended in accordance with this Agreement
without the consent of the Certificateholders.
(i) The Trustee shall make available on the Trustee's internet website each
of the reports filed with the Commission by or on behalf of the Company under
the Exchange Act, as soon as reasonably practicable upon delivery of such
reports to the Trustee.
Section 4.04. Distribution of Reports to the Trustee and
the Company; Advances by the Master Servicer.
(a) Prior to the close of business on the Determination Date, the Master
Servicer shall furnish a written statement to the Trustee, any Paying Agent
and the Company (the information in such statement to be made available to
any Certificate Insurer and Certificateholders by the Master Servicer on
request) setting forth (i) the Available Distribution Amount and (ii) the
amounts required to be withdrawn from the Custodial Account and deposited
into the Certificate Account on the immediately succeeding Certificate
Account Deposit Date pursuant to clause (iii) of Section 4.01(a). The
determination by the Master Servicer of such amounts shall, in the absence of
obvious error, be presumptively deemed to be correct for all purposes
hereunder and the Trustee shall be protected in relying upon the same without
any independent check or verification.
(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, (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. New 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.
As provided in Section 4.05 of the Series Supplement.
Section 4.06. Reports of Foreclosures and Abandonment of Mortgaged
Property.
The Master Servicer or the Subservicers shall file information returns
with respect to the receipt of mortgage interests received in a trade or
business, the reports of foreclosures and abandonments of any Mortgaged
Property and the information returns relating to cancellation of indebtedness
income with respect to any Mortgaged Property required by Sections 6050H,
6050J and 6050P, respectively, of the Code, and deliver to the Trustee an
Officers' Certificate on or before March 31 of each year stating that such
reports have been filed. Such reports shall be in form and substance
sufficient to meet the reporting requirements imposed by Sections 6050H,
6050J and 6050P of the Code.
Section 4.07. Optional Purchase of Defaulted Mortgage Loans.
(a) With respect to any Mortgage Loan that is delinquent in payment by 90
days or more, the Master Servicer may, at its option, purchase such Mortgage
Loan from the Trustee at the Purchase Price therefor; provided, that such
Mortgage Loan that becomes 90 days or more delinquent during any given
Calendar Quarter shall only be eligible for purchase pursuant to this Section
during the period beginning on the first Business Day of the following
Calendar Quarter, and ending at the close of business on the second-to-last
Business Day of such following Calendar Quarter; and provided, further, that
such Mortgage Loan is 90 days or more delinquent at the time of repurchase.
Such option if not exercised shall not thereafter be reinstated as to any
Mortgage Loan, unless the delinquency is cured and the Mortgage Loan
thereafter again becomes delinquent in payment by 90 days or more in a
subsequent Calendar Quarter.
(b) If at any time the Master Servicer makes a payment to the Certificate
Account covering the amount of the Purchase Price for such a Mortgage Loan as
provided in clause (a) above, and the Master Servicer provides to the Trustee
a certification signed by a Servicing Officer stating that the amount of such
payment has been deposited in the Certificate Account, then the Trustee shall
execute the assignment of such Mortgage Loan at the request of the Master
Servicer, without recourse, to the Master Servicer, which shall succeed to
all the Trustee's right, title and interest in and to such Mortgage Loan, and
all security and documents relative thereto. Such assignment shall be an
assignment outright and not for security. The Master Servicer will thereupon
own such Mortgage, and all such security and documents, free of any further
obligation to the Trustee or the Certificateholders with respect thereto.
If, however, the Master Servicer shall have exercised its right to
repurchase a Mortgage Loan pursuant to this Section 4.07 upon the written
request of and with funds provided by the Junior Certificateholder and
thereupon transferred such Mortgage Loan to the Junior Certificateholder, the
Master Servicer shall so notify the Trustee in writing.
Section 4.08. Surety Bond.
(a) If a Required Surety Payment is payable pursuant to the Surety Bond
with respect to any Additional Collateral Loan, the Master Servicer shall so
notify the Trustee as soon as reasonably practicable and the Trustee shall
promptly complete the notice in the form of Attachment 1 to the Surety Bond
and shall promptly submit such notice to the Surety as a claim for a Required
Surety. The Master Servicer shall upon request assist the Trustee in
completing such notice and shall provide any information requested by the
Trustee in connection therewith.
(b) Upon receipt of a Required Surety Payment from the Surety on behalf of
the Holders of Certificates, the Trustee shall deposit such Required Surety
Payment in the Certificate Account and shall distribute such Required Surety
Payment, or the proceeds thereof, in accordance with the provisions of
Section 4.02.
(c) The Trustee shall (i) receive as attorney-in-fact of each Holder of a
Certificate any Required Surety Payment from the Surety and (ii) disburse the
same to the Holders of such Certificates as set forth in Section 4.02.
ARTICLE V
THE CERTIFICATES
Section 5.01. The Certificates.
(a) The Senior, Class X, Class M, Class B, Class P, Class SB and Class R
Certificates shall be substantially in the forms set forth in Exhibits A,
A-I, B, C, C-I, C-II and D, respectively, or such other form or forms as
shall be set forth in the Series Supplement, 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 the Custodian of the documents specified in Section 2.01.
The Certificates shall be issuable in the minimum denominations designated in
the Preliminary Statement to the Series Supplement.
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.
(b) Except as provided below, registration of Book-Entry Certificates may
not be transferred by the Trustee except to another Depository that agrees to
hold such Certificates for the respective Certificate Owners with Ownership
Interests therein. The Holders of the Book-Entry Certificates shall hold
their respective Ownership Interests in and to each of such Certificates
through the book-entry facilities of the Depository and, except as provided
below, shall not be entitled to Definitive Certificates in respect of such
Ownership Interests. All transfers by Certificate Owners of their respective
Ownership Interests in the Book-Entry Certificates shall be made in
accordance with the procedures established by the Depository Participant or
brokerage firm representing such Certificate Owner. Each Depository
Participant shall transfer the Ownership Interests only in the Book-Entry
Certificates of Certificate Owners it represents or of brokerage firms for
which it acts as agent in accordance with the Depository's normal procedures.
The Trustee, the Master Servicer and the Company may for all purposes
(including the making of payments due on the respective Classes of Book-Entry
Certificates) deal with the Depository as the authorized representative of
the Certificate Owners with respect to the respective Classes of Book-Entry
Certificates for the purposes of exercising the rights of Certificateholders
hereunder. The rights of Certificate Owners with respect to the respective
Classes of Book-Entry Certificates shall be limited to those established by
law and agreements between such Certificate Owners and the Depository
Participants and brokerage firms representing such Certificate Owners.
Multiple requests and directions from, and votes of, the Depository as Holder
of any Class of Book-Entry Certificates with respect to any particular matter
shall not be deemed inconsistent if they are made with respect to different
Certificate Owners. The Trustee may establish a reasonable record date in
connection with solicitations of consents from or voting by
Certificateholders and shall give notice to the Depository of such record
date.
If (i)(A) the Company advises the Trustee in writing that the
Depository is no longer willing or able to properly discharge its
responsibilities as Depository and (B) the Company is unable to locate a
qualified successor or (ii) the Company notifies the Depository and the
Trustee of its intent to terminate the book-entry system and, upon receipt of
notice of such intent from the Depository, the Depository Participants
holding beneficial interests in the Book-Entry Certificates agree to such
termination through the Depository, the Trustee shall notify all Certificate
Owners, through the Depository, of the occurrence of any such event and of
the availability of Definitive Certificates to Certificate Owners requesting
the same. Upon surrender to the Trustee of the Book-Entry Certificates by
the Depository, accompanied by registration instructions from the Depository
for registration of transfer, the Trustee shall execute, authenticate and
deliver the Definitive Certificates. In addition, if an Event of Default has
occurred and is continuing, each Certificate Owner materially adversely
affected thereby may at its option request a Definitive Certificate
evidencing such Certificate Owner's Percentage Interest in the related Class
of Certificates. In order to make such a request, such Certificate Owner
shall, subject to the rules and procedures of the Depository, provide the
Depository or the related Depository Participant with directions for the
Certificate Registrar to exchange or cause the exchange of the Certificate
Owner's interest in such Class of Certificates for an equivalent Percentage
Interest in fully registered definitive form. Upon receipt by the
Certificate Registrar of instructions from the Depository directing the
Certificate Registrar to effect such exchange (such instructions shall
contain information regarding the Class of Certificates and the Certificate
Principal Balance being exchanged, the Depository Participant account to be
debited with the decrease, the registered holder of and delivery instructions
for the Definitive Certificate, and any other information reasonably required
by the Certificate Registrar), (i) the Certificate Registrar shall instruct
the Depository to reduce the related Depository Participant's account by the
aggregate Certificate Principal Balance of the Definitive Certificate, (ii)
the Trustee shall execute and the Certificate Registrar shall authenticate
and deliver, in accordance with the registration and delivery instructions
provided by the Depository, a Definitive Certificate evidencing such
Certificate Owner's Percentage Interest in such Class of Certificates and
(iii) the Trustee shall execute and the Certificate Registrar shall
authenticate a new Book-Entry Certificate reflecting the reduction in the
aggregate Certificate Principal Balance of such Class of Certificates by the
Certificate Principal Balance of the Definitive Certificate.
None of the Company, the Master Servicer or the Trustee shall be liable
for any actions taken by the Depository or its nominee, including, without
limitation, any delay in delivery of any instructions required under Section
5.01 and may conclusively rely on, and shall be protected in relying on, such
instructions. Upon the issuance of Definitive Certificates, the Trustee and
the Master Servicer shall recognize the Holders of the Definitive
Certificates as Certificateholders hereunder.
(c) If the Class A-V Certificates are Definitive Certificates, from time to
time Residential Funding, as the initial Holder of the Class A-V
Certificates, may exchange such Holder's Class A-V Certificates for
Subclasses of Class A-V Certificates to be issued under this Agreement by
delivering a "Request for Exchange" substantially in the form attached to
this Agreement as Exhibit N executed by an authorized officer, which
Subclasses, in the aggregate, will represent the Uncertificated Class A-V
REMIC Regular Interests corresponding to the Class A-V Certificates so
surrendered for exchange. Any Subclass so issued shall bear a numerical
designation commencing with Class A-V-1 and continuing sequentially
thereafter, and will evidence ownership of the Uncertificated REMIC Regular
Interest or Interests specified in writing by such initial Holder to the
Trustee. The Trustee may conclusively, without any independent verification,
rely on, and shall be protected in relying on, Residential Funding's
determinations of the Uncertificated Class A-V REMIC Regular Interests
corresponding to any Subclass, the Initial Notional Amount and the initial
Pass-Through Rate on a Subclass as set forth in such Request for Exchange and
the Trustee shall have no duty to determine if any Uncertificated Class A-V
REMIC Regular Interest designated on a Request for Exchange corresponds to a
Subclass which has previously been issued. Each Subclass so issued shall be
substantially in the form set forth in Exhibit A and shall, on original
issue, be executed and delivered by the Trustee to the Certificate Registrar
for authentication and delivery in accordance with Section 5.01(a). Every
Certificate presented or surrendered for exchange by the initial Holder shall
(if so required by the Trustee or the Certificate Registrar) be duly endorsed
by, or be accompanied by a written instrument of transfer attached to such
Certificate and shall be completed to the satisfaction of the Trustee and the
Certificate Registrar duly executed by, the initial Holder thereof or his
attorney duly authorized in writing. The Certificates of any Subclass of
Class A-V Certificates may be transferred in whole, but not in part, in
accordance with the provisions of Section 5.02.
Section 5.02. Registration of Transfer and Exchange of Certificates.
(a) The Trustee shall cause to be kept at one of the offices or agencies to
be appointed by the Trustee in accordance with the provisions of Section 8.12
a Certificate Register in which, subject to such reasonable regulations as it
may prescribe, the Trustee shall provide for the registration of Certificates
and of transfers and exchanges of Certificates as herein provided. The
Trustee is initially appointed Certificate Registrar for the purpose of
registering Certificates and transfers and exchanges of Certificates as
herein provided. The Certificate Registrar, or the Trustee, shall provide
the Master Servicer with a certified list of Certificateholders as of each
Record Date prior to the related Determination Date.
(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 B, Class P or Class 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) At the option of the Certificateholders, Certificates may be exchanged
for other Certificates of authorized denominations of a like Class (or
Subclass) and aggregate Percentage Interest, upon surrender of the
Certificates to be exchanged at any such office or agency. Whenever any
Certificates are so surrendered for exchange the Trustee shall execute and
the Certificate Registrar shall authenticate and deliver the Certificates of
such Class which the Certificateholder making the exchange is entitled to
receive. Every Certificate presented or surrendered for transfer or exchange
shall (if so required by the Trustee or the Certificate Registrar) be duly
endorsed by, or be accompanied by a written instrument of transfer in form
satisfactory to the Trustee and the Certificate Registrar duly executed by,
the Holder thereof or his attorney duly authorized in writing.
(d) No transfer, sale, pledge or other disposition of a Class B Certificate
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 B Certificate 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 (with respect
to any Class B Certificate) or Exhibit G-1 (with respect to any Class P
Certificate) hereto, and the Trustee shall require the transferor to execute
a representation letter, substantially in the form of Exhibit I hereto, 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 hereto (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) In the case of any Class B, Class P or Class R Certificate
presented for registration in the name of any Person, either (A)
the Trustee shall require an Opinion of Counsel addressed to the
Trustee, the Company and the Master Servicer, acceptable to and
in form and substance satisfactory to the Trustee to the effect
that the purchase or holding of such Class B, Class P or Class R
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 (with respect to any Class B Certificate) or paragraph fifteen
of Exhibit G-1 (with respect to any Class R Certificate or Class
P 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 an employee benefit
plan or other plan subject to the prohibited transaction
provisions of ERISA or Section 4975 of the Code, or any Person
(including 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") or (b) in the
case of any Class 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").
(ii) Any Transferee of a Class 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, as most recently amended, 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.
(iii) (A) If any Class 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 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) (i) Each Person who has or who acquires any Ownership Interest in a
Class R Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions and
to have irrevocably authorized the Trustee or its designee under clause
(iii)(A) below to deliver payments to a Person other than such Person and to
negotiate the terms of any mandatory sale under clause (iii)(B) below and to
execute all instruments of transfer and to do all other things necessary in
connection with any such sale. The rights of each Person acquiring any
Ownership Interest in a Class R Certificate are expressly subject to the
following provisions:
(A) Each Person holding or acquiring any Ownership Interest in a Class R
Certificate shall be a Permitted Transferee and shall promptly
notify the Trustee of any change or impending change in its
status as a Permitted Transferee.
(B) In connection with any proposed Transfer of any Ownership Interest in a
Class R Certificate, the Trustee shall require delivery to it,
and shall not register the Transfer of any Class R Certificate
until its receipt of, (I) an affidavit and agreement (a "Transfer
Affidavit and Agreement," in the form attached hereto as Exhibit
G-1) from the proposed Transferee, in form and substance
satisfactory to the Master Servicer, representing and warranting,
among other things, that it is a Permitted Transferee, that it is
not acquiring its Ownership Interest in the Class R Certificate
that is the subject of the proposed Transfer as a nominee,
trustee or agent for any Person who is not a Permitted
Transferee, that for so long as it retains its Ownership Interest
in a Class R Certificate, it will endeavor to remain a Permitted
Transferee, and that it has reviewed the provisions of this
Section 5.02(f) and agrees to be bound by them, and (II) a
certificate, in the form attached hereto as Exhibit G-2, from the
Holder wishing to transfer the Class R Certificate, in form and
substance satisfactory to the Master Servicer, representing and
warranting, among other things, that no purpose of the proposed
Transfer is to impede the assessment or collection of tax.
(C) Notwithstanding the delivery of a Transfer Affidavit and Agreement by a
proposed Transferee under clause (B) above, if a Responsible
Officer of the Trustee who is assigned to this Agreement has
actual knowledge that the proposed Transferee is not a Permitted
Transferee, no Transfer of an Ownership Interest in a Class R
Certificate to such proposed Transferee shall be effected.
(D) Each Person holding or acquiring any Ownership Interest in a Class R
Certificate shall agree (x) to require a Transfer Affidavit and
Agreement from any other Person to whom such Person attempts to
transfer its Ownership Interest in a Class R Certificate and (y)
not to transfer its Ownership Interest unless it provides a
certificate to the Trustee in the form attached hereto as Exhibit
G-2.
(E) Each Person holding or acquiring an Ownership Interest in a Class R
Certificate, by purchasing an Ownership Interest in such
Certificate, agrees to give the Trustee written notice that it is
a "pass-through interest holder" within the meaning of Temporary
Treasury Regulations Section 1.67-3T(a)(2)(i)(A) immediately upon
acquiring an Ownership Interest in a Class R Certificate, if it
is, or is holding an Ownership Interest in a Class R Certificate
on behalf of, a "pass-through interest holder."
(ii) The Trustee shall register the Transfer of any Class R Certificate only
if it shall have received the Transfer Affidavit and Agreement, a
certificate of the Holder requesting such transfer in the form attached
hereto as Exhibit G-2 and all of such other documents as shall have
been reasonably required by the Trustee as a condition to such
registration. Transfers of the Class R Certificates to Non-United
States Persons and Disqualified Organizations (as defined in Section
860E(e)(5) of the Code) are prohibited.
(iii) (A) If any Disqualified Organization shall become a holder of a
Class R Certificate, then the last preceding Permitted Transferee shall
be restored, to the extent permitted by law, to all rights and
obligations as Holder thereof retroactive to the date of registration
of such Transfer of such Class R Certificate. If a Non-United States
Person shall become a holder of a Class R Certificate, then the last
preceding United States Person shall be restored, to the extent
permitted by law, to all rights and obligations as Holder thereof
retroactive to the date of registration of such Transfer of such Class
R Certificate. If a transfer of a Class R Certificate is disregarded
pursuant to the provisions of Treasury Regulations Section 1.860E-1 or
Section 1.860G-3, then the last preceding Permitted Transferee shall be
restored, to the extent permitted by law, to all rights and obligations
as Holder thereof retroactive to the date of registration of such
Transfer of such Class R Certificate. The Trustee shall be under no
liability to any Person for any registration of Transfer of a Class R
Certificate that is in fact not permitted by this Section 5.02(f) or
for making any payments due on such Certificate to the holder thereof
or for taking any other action with respect to such holder under the
provisions of this Agreement.
(B) If any purported Transferee shall become a Holder of a Class R
Certificate in violation of the restrictions in this Section
5.02(f) and to the extent that the retroactive restoration of the
rights of the Holder of such Class R Certificate as described in
clause (iii)(A) above shall be invalid, illegal or unenforceable,
then the Master Servicer shall have the right, without notice to
the holder or any prior holder of such Class R Certificate, to
sell such Class R Certificate to a purchaser selected by the
Master Servicer on such terms as the Master Servicer may choose.
Such purported Transferee shall promptly endorse and deliver each
Class R Certificate in accordance with the instructions of the
Master Servicer. Such purchaser may be the Master Servicer
itself or any Affiliate of the Master Servicer. The proceeds of
such sale, net of the commissions (which may include commissions
payable to the Master Servicer or its Affiliates), expenses and
taxes due, if any, shall be remitted by the Master Servicer to
such purported Transferee. The terms and conditions of any sale
under this clause (iii)(B) shall be determined in the sole
discretion of the Master Servicer, and the Master Servicer shall
not be liable to any Person having an Ownership Interest in a
Class R Certificate as a result of its exercise of such
discretion.
(iv) The Master Servicer, on behalf of the Trustee, shall make available,
upon written request from the Trustee, all information necessary to
compute any tax imposed (A) as a result of the Transfer of an Ownership
Interest in a Class R Certificate to any Person who is a Disqualified
Organization, including the information regarding "excess inclusions"
of such Class R Certificates required to be provided to the Internal
Revenue Service and certain Persons as described in Treasury
Regulations Sections 1.860D-1(b)(5) and 1.860E-2(a)(5), and (B) as a
result of any regulated investment company, real estate investment
trust, common trust fund, partnership, trust, estate or organization
described in Section 1381 of the Code that holds an Ownership Interest
in a Class R Certificate having as among its record holders at any time
any Person who is a Disqualified Organization. Reasonable compensation
for providing such information may be required by the Master Servicer
from such Person.
(v) The provisions of this Section 5.02(f) set forth prior to this clause
(v) may be modified, added to or eliminated, provided that there shall
have been delivered to the Trustee the following:
(A) written notification from each Rating Agency to the effect that the
modification, addition to or elimination of such provisions will
not cause such Rating Agency to downgrade its then-current
ratings, if any, of any Class of the Senior (in the case of the
Insured Certificates (as defined in the Series Supplement), such
determination shall be made without giving effect to the
Certificate Policy (as defined in the Series Supplement)), Class
M or Class B Certificates 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
(B) subject to Section 10.01(f), an Officers' Certificate of the Master
Servicer stating that the Master Servicer has received an Opinion
of Counsel, in form and substance satisfactory to the Master
Servicer, to the effect that such modification, addition to or
absence of such provisions will not cause any portion of any
REMIC formed under the Series Supplement to cease to qualify as a
REMIC and will not cause (x) any portion of any REMIC formed
under the Series Supplement to be subject to an entity-level tax
caused by the Transfer of any Class R Certificate to a Person
that is a Disqualified Organization or (y) a Certificateholder or
another Person to be subject to a REMIC-related tax caused by the
Transfer of a Class R Certificate to a Person that is not a
Permitted Transferee.
(g) No service charge shall be made for any transfer or exchange of
Certificates of any Class, but the Trustee may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
(h) All Certificates surrendered for transfer and exchange shall be
destroyed by the Certificate Registrar.
Section 5.03. Mutilated, Destroyed, Lost or Stolen Certificates.
If (i) any mutilated Certificate is surrendered to the Certificate
Registrar, or the Trustee and the Certificate Registrar receive evidence to
their satisfaction of the destruction, loss or theft of any Certificate, and
(ii) there is delivered to the Trustee and the Certificate Registrar such
security or indemnity as may be required by them to save each of them
harmless, then, in the absence of notice to the Trustee or the Certificate
Registrar that such Certificate has been acquired by a bona fide purchaser,
the Trustee shall execute and the Certificate Registrar shall authenticate
and deliver, in exchange for or in lieu of any such mutilated, destroyed,
lost or stolen Certificate, a new Certificate of like tenor, Class and
Percentage Interest but bearing a number not contemporaneously outstanding.
Upon the issuance of any new Certificate under this Section, the Trustee may
require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee and the Certificate
Registrar) connected therewith. Any duplicate Certificate issued pursuant to
this Section shall constitute complete and indefeasible evidence of ownership
in the Trust Fund, as if originally issued, whether or not the lost, stolen
or destroyed Certificate shall be found at any time.
Section 5.04. Persons Deemed Owners.
Prior to due presentation of a Certificate for registration of
transfer, the Company, the Master Servicer, the Trustee, any Certificate
Insurer, the Certificate Registrar and any agent of the Company, the Master
Servicer, the Trustee, any Certificate Insurer or the Certificate Registrar
may treat the Person in whose name any Certificate is registered as the owner
of such Certificate for the purpose of receiving distributions pursuant to
Section 4.02 and for all other purposes whatsoever, except as and to the
extent provided in the definition of "Certificateholder," and neither the
Company, the Master Servicer, the Trustee, any Certificate Insurer, the
Certificate Registrar nor any agent of the Company, the Master Servicer, the
Trustee, any Certificate Insurer or the Certificate Registrar shall be
affected by notice to the contrary except as provided in Section 5.02(f).
Section 5.05. Appointment of Paying Agent.
The Trustee may appoint a Paying Agent for the purpose of making
distributions to the Certificateholders pursuant to Section 4.02. In the
event of any such appointment, on or prior to each Distribution Date the
Master Servicer on behalf of the Trustee shall deposit or cause to be
deposited with the Paying Agent a sum sufficient to make the payments to the
Certificateholders in the amounts and in the manner provided for in Section
4.02, such sum to be held in trust for the benefit of the Certificateholders.
The Trustee shall cause each Paying Agent to execute and deliver to the
Trustee an instrument in which such Paying Agent shall agree with the Trustee
that such Paying Agent shall hold all sums held by it for the payment to the
Certificateholders in trust for the benefit of the Certificateholders
entitled thereto until such sums shall be distributed to such
Certificateholders. Any sums so held by such Paying Agent shall be held only
in Eligible Accounts to the extent such sums are not distributed to the
Certificateholders on the date of receipt by such Paying Agent.
Section 5.06. U.S.A. Patriot Act Compliance.
In order for it to comply with its duties under the U.S.A. Patriot Act,
the Trustee may obtain and verify certain information from the other parties
hereto, including but not limited to such parties' name, address and other
identifying information.
ARTICLE VI
THE COMPANY AND THE MASTER SERVICER
Section 6.01. Respective Liabilities of the Company and the Master
Servicer.
The Company and the Master Servicer shall each be liable in accordance
herewith only to the extent of the obligations specifically and respectively
imposed upon and undertaken by the Company and the Master Servicer herein.
By way of illustration and not limitation, the Company is not liable for the
servicing and administration of the Mortgage Loans, nor is it obligated by
Section 7.01 or Section 10.01 to assume any obligations of the Master
Servicer or to appoint a designee to assume such obligations, nor is it
liable for any other obligation hereunder that it may, but is not obligated
to, assume unless it elects to assume such obligation in accordance herewith.
Section 6.02. Merger or Consolidation of the Company or the Master
Servicer; Assignment of Rights and Delegation of Duties by
Master Servicer.
(a) The Company and the Master Servicer shall each keep in full effect its
existence, rights and franchises as a corporation under the laws of the state
of its incorporation and as a limited liability company under the laws of the
state of its organization, respectively, and shall each obtain and preserve
its qualification to do business as a foreign corporation or other Person in
each jurisdiction in which such qualification is or shall be necessary to
protect the validity and enforceability of this Agreement, the Certificates
or any of the Mortgage Loans and to perform its respective duties under this
Agreement.
(b) Any Person into which the Company 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 Company or the
Master Servicer shall be a party, or any Person succeeding to the business of
the Company or the Master Servicer, shall be the successor of the Company 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 Xxxxxxx Mac; and provided further that the Master Servicer (or the
Company, as applicable) shall notify each Rating Agency and the Trustee in
writing of any such merger, conversion or consolidation at least 30 days
prior to the effective date of such event.
(c) Notwithstanding anything else in this Section 6.02 and Section 6.04 to
the contrary, the Master Servicer may assign its rights and delegate its
duties and obligations under this Agreement; provided that the Person
accepting such assignment or delegation shall be a Person which is qualified
to service mortgage loans on behalf of Xxxxxx Mae or Xxxxxxx Mac, is
reasonably satisfactory to the Trustee and the Company, is willing to service
the Mortgage Loans and executes and delivers to the Company and the Trustee
an agreement, in form and substance reasonably satisfactory to the Company
and the Trustee, which contains an assumption by such Person of the due and
punctual performance and observance of each covenant and condition to be
performed or observed by the Master Servicer under this Agreement; provided
further that each Rating Agency's rating of the Classes of Certificates (in
the case of the Insured Certificates (as defined in the Series Supplement),
such determination shall be made without giving effect to the Certificate
Policy (as defined in the Series Supplement)) that have been rated in effect
immediately prior to such assignment and delegation will not be qualified,
reduced or withdrawn as a result of such assignment and delegation (as
evidenced by a letter to such effect from each Rating Agency). In the case
of any such assignment and delegation, the Master Servicer shall be released
from its obligations under this Agreement, except that the Master Servicer
shall remain liable for all liabilities and obligations incurred by it as
Master Servicer hereunder prior to the satisfaction of the conditions to such
assignment and delegation set forth in the next preceding sentence.
Notwithstanding the foregoing, in the event of a pledge or assignment by the
Master Servicer solely of its rights to purchase all assets of the Trust Fund
under Section 9.01(a) (or, if so specified in Section 9.01(a), its rights to
purchase the Mortgage Loans and property acquired related to such Mortgage
Loans or its rights to purchase the Certificates related thereto), the
provisos of the first sentence of this paragraph will not apply.
Section 6.03. Limitation on Liability of the Company,
the Master Servicer and Others.
Neither the Company, the Master Servicer nor any of the directors,
officers, employees or agents of the Company or the Master Servicer shall be
under any liability to the Trust Fund or the Certificateholders for any
action taken or for refraining from the taking of any action in good faith
pursuant to this Agreement, or for errors in judgment; provided, however,
that this provision shall not protect the Company, the Master Servicer or any
such Person against any breach of warranties or representations made herein
or any liability which would otherwise be imposed by reason of willful
misfeasance, bad faith or gross negligence in the performance of duties or by
reason of reckless disregard of obligations and duties hereunder. The
Company, the Master Servicer and any director, officer, employee or agent of
the Company or the Master Servicer may rely in good faith on any document of
any kind prima facie properly executed and submitted by any Person respecting
any matters arising hereunder. The Company, the Master Servicer and any
director, officer, employee or agent of the Company or the Master Servicer
shall be indemnified by the Trust Fund and held harmless against any loss,
liability or expense incurred in connection with any legal action relating to
this Agreement or the Certificates, other than any loss, liability or expense
related to any specific Mortgage Loan or Mortgage Loans (except as any such
loss, liability or expense shall be otherwise reimbursable pursuant to this
Agreement) and any loss, liability or expense incurred by reason of willful
misfeasance, bad faith or gross negligence in the performance of duties
hereunder or by reason of reckless disregard of obligations and duties
hereunder.
Neither the Company nor the Master Servicer shall be under any
obligation to appear in, prosecute or defend any legal or administrative
action, proceeding, hearing or examination that is not incidental to its
respective duties under this Agreement and which in its opinion may involve
it in any expense or liability; provided, however, that the Company or the
Master Servicer may in its discretion undertake any such action, proceeding,
hearing or examination that it may deem necessary or desirable in respect to
this Agreement and the rights and duties of the parties hereto and the
interests of the Certificateholders hereunder. In such event, the legal
expenses and costs of such action, proceeding, hearing or examination and any
liability resulting therefrom shall be expenses, costs and liabilities of the
Trust Fund, and the Company and the Master Servicer shall be entitled to be
reimbursed therefor out of amounts attributable to the Mortgage Loans on
deposit in the Custodial Account as provided by Section 3.10 and, on the
Distribution Date(s) following such reimbursement, the aggregate of such
expenses and costs shall be allocated in reduction of the Accrued Certificate
Interest on each Class entitled thereto in the same manner as if such
expenses and costs constituted a Prepayment Interest Shortfall.
Section 6.04. Company and Master Servicer Not to Resign.
Subject to the provisions of Section 6.02, neither the Company nor the
Master Servicer shall resign from its respective obligations and duties
hereby imposed on it except upon determination that its duties hereunder are
no longer permissible under applicable law. Any such determination
permitting the resignation of the Company or the Master Servicer shall be
evidenced by an Opinion of Counsel to such effect delivered to the Trustee.
No such resignation by the Master Servicer shall become effective until the
Trustee or a successor servicer shall have assumed the Master Servicer's
responsibilities and obligations in accordance with Section 7.02.
ARTICLE VII
DEFAULT
Section 7.01. Events of Default.
Event of Default, wherever used herein, means any one of the following
events (whatever reason for such Event of Default and whether it shall be
voluntary or involuntary or be effected by operation of law or pursuant to
any judgment, decree or order of any court or any order, rule or regulation
of any administrative or governmental body):
(i) the Master Servicer shall fail to deposit or cause to be deposited into
the Certificate Account any amounts required to be so deposited therein
at the time required pursuant to Section 4.01 or otherwise or the
Master Servicer shall fail to distribute or cause to be distributed to
the Holders of Certificates of any Class any distribution required to
be made under the terms of the Certificates of such Class and this
Agreement and, in each case, such failure shall continue unremedied for
a period of 5 days after the date upon which written notice of such
failure, requiring such failure to be remedied, shall have been given
to the Master Servicer by the Trustee or the Company or to the Master
Servicer, the Company and the Trustee by the Holders of Certificates of
such Class evidencing Percentage Interests aggregating not less than
25%; or
(ii) the Master Servicer shall fail to observe or perform in any material
respect any other of the covenants or agreements on the part of the
Master Servicer contained in the Certificates of any Class or in this
Agreement and such failure shall continue unremedied for a period of 30
days (except that such number of days shall be 15 in the case of a
failure to pay the premium for any Required Insurance Policy) after the
date on which written notice of such failure, requiring the same to be
remedied, shall have been given to the Master Servicer by the Trustee
or the Company, or to the Master Servicer, the Company and the Trustee
by the Holders of Certificates of any Class evidencing, in the case of
any such Class, Percentage Interests aggregating not less than 25%; or
(iii) a decree or order of a court or agency or supervisory authority having
jurisdiction in the premises in an involuntary case under any present
or future federal or state bankruptcy, insolvency or similar law or
appointing a conservator or receiver or liquidator in any insolvency,
readjustment of debt, marshalling of assets and liabilities or similar
proceedings, or for the winding-up or liquidation of its affairs, shall
have been entered against the Master Servicer and such decree or order
shall have remained in force undischarged or unstayed for a period of
60 days; or
(iv) the Master Servicer shall consent to the appointment of a conservator
or receiver or liquidator in any insolvency, readjustment of debt,
marshalling of assets and liabilities, or similar proceedings of, or
relating to, the Master Servicer or of, or relating to, all or
substantially all of the property of the Master Servicer; or
(v) the Master Servicer shall admit in writing its inability to pay its
debts generally as they become due, file a petition to take advantage
of, or commence a voluntary case under, any applicable insolvency or
reorganization statute, make an assignment for the benefit of its
creditors, or voluntarily suspend payment of its obligations; or
(vi) the Master Servicer shall notify the Trustee pursuant to Section
4.04(b) that it is unable to deposit in the Certificate Account an
amount equal to the Advance.
If an Event of Default described in clauses (i)-(v) of this Section
shall occur, then, and in each and every such case, so long as such Event of
Default shall not have been remedied, either the Company or the Trustee may,
and at the direction of Holders of Certificates entitled to at least 51% of
the Voting Rights, the Trustee shall, by notice in writing to the Master
Servicer (and to the Company if given by the Trustee or to the Trustee if
given by the Company), terminate all of the rights and obligations of the
Master Servicer under this Agreement and in and to the Mortgage Loans and the
proceeds thereof, other than its rights as a Certificateholder hereunder. If
an Event of Default described in clause (vi) hereof shall occur, the Trustee
shall, by notice to the Master Servicer and the Company, immediately
terminate all of the rights and obligations of the Master Servicer under this
Agreement and in and to the Mortgage Loans and the proceeds thereof, other
than its rights as a Certificateholder hereunder as provided in Section
4.04(b). On or after the receipt by the Master Servicer of such written
notice, all authority and power of the Master Servicer under this Agreement,
whether with respect to the Certificates (other than as a Holder thereof) or
the Mortgage Loans or otherwise, shall subject to Section 7.02 pass to and be
vested in the Trustee or the Trustee's designee appointed pursuant to Section
7.02; and, without limitation, the Trustee is hereby authorized and empowered
to execute and deliver, on behalf of the Master Servicer, as attorney-in-fact
or otherwise, any and all documents and other instruments, and to do or
accomplish all other acts or things necessary or appropriate to effect the
purposes of such notice of termination, whether to complete the transfer and
endorsement or assignment of the Mortgage Loans and related documents, or
otherwise. The Master Servicer agrees to cooperate with the Trustee in
effecting the termination of the Master Servicer's responsibilities and
rights hereunder, including, without limitation, the transfer to the Trustee
or its designee for administration by it of all cash amounts which shall at
the time be credited to the Custodial Account or the Certificate Account or
thereafter be received with respect to the Mortgage Loans. No such
termination shall release the Master Servicer for any liability that it would
otherwise have hereunder for any act or omission prior to the effective time
of such termination.
Notwithstanding any termination of the activities of Residential
Funding in its capacity as Master Servicer hereunder, Residential Funding
shall be entitled to receive, out of any late collection of a Monthly Payment
on a Mortgage Loan which was due prior to the notice terminating Residential
Funding's rights and obligations as Master Servicer hereunder and received
after such notice, that portion to which Residential Funding would have been
entitled pursuant to Sections 3.10(a)(ii), (vi) and (vii) as well as its
Servicing Fee in respect thereof, and any other amounts payable to
Residential Funding hereunder the entitlement to which arose prior to the
termination of its activities hereunder. Upon the termination of Residential
Funding as Master Servicer hereunder the Company shall deliver to the Trustee
a copy of the Program Guide.
Section 7.02. Trustee or Company to Act; Appointment of Successor.
(a) On and after the time the Master Servicer receives a notice of
termination pursuant to Section 7.01 or resigns in accordance with Section
6.04, the Trustee or, upon notice to the Company and with the Company's
consent (which shall not be unreasonably withheld) a designee (which meets
the standards set forth below) of the Trustee, shall be the successor in all
respects to the Master Servicer in its capacity as servicer under this
Agreement and the transactions set forth or provided for herein and shall be
subject to all the responsibilities, duties and liabilities relating thereto
placed on the Master Servicer (except for the responsibilities, duties and
liabilities contained in Sections 2.02 and 2.03(a), excluding the duty to
notify related Subservicers or Sellers as set forth in such Sections, and its
obligations to deposit amounts in respect of losses incurred prior to such
notice or termination on the investment of funds in the Custodial Account or
the Certificate Account pursuant to Sections 3.07(c) and 4.01(b) by the terms
and provisions hereof); provided, however, that any failure to perform such
duties or responsibilities caused by the preceding Master Servicer's failure
to provide information required by Section 4.04 shall not be considered a
default by the Trustee hereunder. As compensation therefor, the Trustee
shall be entitled to all funds relating to the Mortgage Loans which the
Master Servicer would have been entitled to charge to the Custodial Account
or the Certificate Account if the Master Servicer had continued to act
hereunder and, in addition, shall be entitled to the income from any
Permitted Investments made with amounts attributable to the Mortgage Loans
held in the Custodial Account or the Certificate Account. If the Trustee has
become the successor to the Master Servicer in accordance with Section 6.04
or Section 7.01, then notwithstanding the above, the Trustee may, if it shall
be unwilling to so act, or shall, if it is unable to so act, appoint, or
petition a court of competent jurisdiction to appoint, any established
housing and home finance institution, which is also a Xxxxxx Xxx- or Xxxxxxx
Mac-approved mortgage servicing institution, having a net worth of not less
than $10,000,000 as the successor to the Master Servicer hereunder in the
assumption of all or any part of the responsibilities, duties or liabilities
of the Master Servicer hereunder. Pending appointment of a successor to the
Master Servicer hereunder, the Trustee shall become successor to the Master
Servicer and shall act in such capacity as hereinabove provided. In
connection with such appointment and assumption, the Trustee may make such
arrangements for the compensation of such successor out of payments on
Mortgage Loans as it and such successor shall agree; provided, however, that
no such compensation shall be in excess of that permitted the initial Master
Servicer hereunder. The Company, the Trustee, the Custodian and such
successor shall take such action, consistent with this Agreement, as shall be
necessary to effectuate any such succession. The Servicing Fee for any
successor Master Servicer appointed pursuant to this Section 7.02 will be
lowered with respect to those Mortgage Loans, if any, where the Subservicing
Fee accrues at a rate of less than 0.20% per annum in the event that the
successor Master Servicer is not servicing such Mortgage Loans directly and
it is necessary to raise the related Subservicing Fee to a rate of 0.20% per
annum in order to hire a Subservicer with respect to such Mortgage Loans.
The Master Servicer shall pay the reasonable expenses of the Trustee in
connection with any servicing transition hereunder.
(b) In connection with the termination or resignation of the Master
Servicer hereunder, either (i) the successor Master Servicer, including the
Trustee if the Trustee is acting as successor Master Servicer, shall
represent and warrant that it is a member of MERS in good standing and shall
agree to comply in all material respects with the rules and procedures of
MERS in connection with the servicing of the Mortgage Loans that are
registered with MERS, in which case the predecessor Master Servicer shall
cooperate with the successor Master Servicer in causing MERS to revise its
records to reflect the transfer of servicing to the successor Master Servicer
as necessary under MERS' rules and regulations, or (ii) the predecessor
Master Servicer shall cooperate with the successor Master Servicer in causing
MERS to execute and deliver an assignment of Mortgage in recordable form to
transfer the Mortgage from MERS to the Trustee and to execute and deliver
such other notices, documents and other instruments as may be necessary or
desirable to effect a transfer of such Mortgage Loan or servicing of such
Mortgage Loan on the MERS(R)System to the successor Master Servicer. The
predecessor Master Servicer shall file or cause to be filed any such
assignment in the appropriate recording office. The predecessor Master
Servicer shall bear any and all fees of MERS, costs of preparing any
assignments of Mortgage, and fees and costs of filing any assignments of
Mortgage that may be required under this subsection (b). The successor
Master Servicer shall cause such assignment to be delivered to the Trustee or
the Custodian promptly upon receipt of the original with evidence of
recording thereon or a copy certified by the public recording office in which
such assignment was recorded.
Section 7.03. Notification to Certificateholders.
(a) Upon any such termination or appointment of a successor to the Master
Servicer, the Trustee shall give prompt written notice thereof to the
Certificateholders at their respective addresses appearing in the Certificate
Register.
(b) Within 60 days after the occurrence of any Event of Default, the
Trustee shall transmit by mail to all Holders of Certificates notice of each
such Event of Default hereunder known to the Trustee, unless such Event of
Default shall have been cured or waived.
Section 7.04. Waiver of Events of Default.
The Holders representing at least 66% of the Voting Rights affected by
a default or Event of Default hereunder may waive such default or Event of
Default; provided, however, that (a) a default or Event of Default under
clause (i) of Section 7.01 may be waived only by all of the Holders of
Certificates affected by such default or Event of Default and (b) no waiver
pursuant to this Section 7.04 shall affect the Holders of Certificates in the
manner set forth in Section 11.01(b)(i) or (ii). Upon any such waiver of a
default or Event of Default by the Holders representing the requisite
percentage of Voting Rights affected by such default or Event of Default,
such default or Event of Default shall cease to exist and shall be deemed to
have been remedied for every purpose hereunder. No such waiver shall extend
to any subsequent or other default or Event of Default or impair any right
consequent thereon except to the extent expressly so waived.
ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.01. Duties of Trustee.
(a) The Trustee, prior to the occurrence of an Event of Default and after
the curing or waiver of all Events of Default which may have occurred,
undertakes to perform such duties and only such duties as are specifically
set forth in this Agreement. In case an Event of Default has occurred (which
has not been cured or waived), the Trustee shall exercise such of the rights
and powers vested in it by this Agreement, and use the same degree of care
and skill in their exercise as a prudent investor would exercise or use under
the circumstances in the conduct of such investor's own affairs.
(b) The Trustee, upon receipt of all resolutions, certificates, statements,
opinions, reports, documents, orders or other instruments furnished to the
Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they
conform to the requirements of this Agreement. The Trustee shall notify the
Certificateholders of any such documents which do not materially conform to
the requirements of this Agreement in the event that the Trustee, after so
requesting, does not receive satisfactorily corrected documents.
The Trustee shall forward or cause to be forwarded in a timely fashion
the notices, reports and statements required to be forwarded by the Trustee
pursuant to Sections 4.03, 4.06, 7.03 and 10.01. The Trustee shall furnish
in a timely fashion to the Master Servicer such information as the Master
Servicer may reasonably request from time to time for the Master Servicer to
fulfill its duties as set forth in this Agreement. The Trustee covenants and
agrees that it shall perform its obligations hereunder in a manner so as to
maintain the status of any portion of any REMIC formed under the Series
Supplement as a REMIC under the REMIC Provisions and (subject to Section
10.01(f)) to prevent the imposition of any federal, state or local income,
prohibited transaction, contribution or other tax on the Trust Fund to the
extent that maintaining such status and avoiding such taxes are reasonably
within the control of the Trustee and are reasonably within the scope of its
duties under this Agreement.
(c) No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent
failure to act or its own willful misconduct; provided, however, that:
(i) Prior to the occurrence of an Event of Default, and after the curing or
waiver of all such Events of Default which may have occurred, the
duties and obligations of the Trustee shall be determined solely by the
express provisions of this Agreement, the Trustee shall not be liable
except for the performance of such duties and obligations as are
specifically set forth in this Agreement, no implied covenants or
obligations shall be read into this Agreement against the Trustee and,
in the absence of bad faith on the part of the Trustee, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any certificates or
opinions furnished to the Trustee by the Company or the Master Servicer
and which on their face, do not contradict the requirements of this
Agreement;
(ii) The Trustee shall not be personally liable for an error of judgment
made in good faith by a Responsible Officer or Responsible Officers of
the Trustee, unless it shall be proved that the Trustee was negligent
in ascertaining the pertinent facts;
(iii) The Trustee shall not be personally liable with respect to any action
taken, suffered or omitted to be taken by it in good faith in
accordance with the direction of Certificateholders of any Class
holding Certificates which evidence, as to such Class, Percentage
Interests aggregating not less than 25% as to the time, method and
place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred upon the Trustee,
under this Agreement;
(iv) The Trustee shall not be charged with knowledge of any default (other
than a default in payment to the Trustee) specified in clauses (i) and
(ii) of Section 7.01 or an Event of Default under clauses (iii), (iv)
and (v) of Section 7.01 unless a Responsible Officer of the Trustee
assigned to and working in the Corporate Trust Office obtains actual
knowledge of such failure or event or the Trustee receives written
notice of such failure or event at its Corporate Trust Office from the
Master Servicer, the Company or any Certificateholder; and
(v) Except to the extent provided in Section 7.02, no provision in this
Agreement shall require the Trustee to expend or risk its own funds
(including, without limitation, the making of any Advance) or otherwise
incur any personal financial liability in the performance of any of its
duties as Trustee hereunder, or in the exercise of any of its rights or
powers, if the Trustee shall have reasonable grounds for believing that
repayment of funds or adequate indemnity against such risk or liability
is not reasonably assured to it.
(d) The Trustee shall timely pay, from its own funds, the amount of any and
all federal, state and local taxes imposed on the Trust Fund or its assets or
transactions including, without limitation, (A) "prohibited transaction"
penalty taxes as defined in Section 860F of the Code, if, when and as the
same shall be due and payable, (B) any tax on contributions to a REMIC after
the Closing Date imposed by Section 860G(d) of the Code and (C) any tax on
"net income from foreclosure property" as defined in Section 860G(c) of the
Code, but only if such taxes arise out of a breach by the Trustee of its
obligations hereunder, which breach constitutes negligence or willful
misconduct of the Trustee.
Section 8.02. Certain Matters Affecting the Trustee.
(a) Except as otherwise provided in Section 8.01:
(i) The Trustee may rely and shall be protected in acting or refraining
from acting upon any resolution, Officers' Certificate, certificate of
auditors or any other certificate, statement, instrument, opinion,
report, notice, request, consent, order, appraisal, bond or other paper
or document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(ii) The Trustee may consult with counsel and any Opinion of Counsel shall
be full and complete authorization and protection in respect of any
action taken or suffered or omitted by it hereunder in good faith and
in accordance with such Opinion of Counsel;
(iii) The Trustee shall be under no obligation to exercise any of the trusts
or powers vested in it by this Agreement or to institute, conduct or
defend any litigation hereunder or in relation hereto at the request,
order or direction of any of the Certificateholders, pursuant to the
provisions of this Agreement, unless such Certificateholders shall have
offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which may be incurred therein or
thereby; nothing contained herein shall, however, relieve the Trustee
of the obligation, upon the occurrence of an Event of Default (which
has not been cured or waived), to exercise such of the rights and
powers vested in it by this Agreement, and to use the same degree of
care and skill in their exercise as a prudent investor would exercise
or use under the circumstances in the conduct of such investor's own
affairs;
(iv) The Trustee shall not be personally liable for any action taken,
suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers conferred upon
it by this Agreement;
(v) Prior to the occurrence of an Event of Default hereunder and after the
curing or waiver of all Events of Default which may have occurred, the
Trustee shall not be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond or
other paper or document, unless requested in writing so to do by
Holders of Certificates of any Class evidencing, as to such Class,
Percentage Interests, aggregating not less than 50%; provided, however,
that if the payment within a reasonable time to the Trustee of the
costs, expenses or liabilities likely to be incurred by it in the
making of such investigation is, in the opinion of the Trustee, not
reasonably assured to the Trustee by the security afforded to it by the
terms of this Agreement, the Trustee may require reasonable indemnity
against such expense or liability as a condition to so proceeding. The
reasonable expense of every such examination shall be paid by the
Master Servicer, if an Event of Default shall have occurred and is
continuing, and otherwise by the Certificateholder requesting the
investigation;
(vi) The Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys; and
(vii) To the extent authorized under the Code and the regulations promulgated
thereunder, each Holder of a Class R Certificate hereby irrevocably
appoints and authorizes the Trustee to be its attorney-in-fact for
purposes of signing any Tax Returns required to be filed on behalf of
the Trust Fund. The Trustee shall sign on behalf of the Trust Fund and
deliver to the Master Servicer in a timely manner any Tax Returns
prepared by or on behalf of the Master Servicer that the Trustee is
required to sign as determined by the Master Servicer pursuant to
applicable federal, state or local tax laws, provided that the Master
Servicer shall indemnify the Trustee for signing any such Tax Returns
that contain errors or omissions.
(b) Following the issuance of the Certificates, the Trustee shall not
accept any contribution of assets to the Trust Fund unless (subject to
Section 10.01(f)) it shall have obtained or been furnished with an Opinion of
Counsel to the effect that such contribution will not (i) cause any portion
of any REMIC formed under the Series Supplement to fail to qualify as a REMIC
at any time that any Certificates are outstanding or (ii) cause the Trust
Fund to be subject to any federal tax as a result of such contribution
(including the imposition of any federal tax on "prohibited transactions"
imposed under Section 860F(a) of the Code).
Section 8.03. Trustee Not Liable for Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates (other than the
execution of the Certificates and relating to the acceptance and receipt of
the Mortgage Loans) shall be taken as the statements of the Company or the
Master Servicer as the case may be, and the Trustee assumes no responsibility
for their correctness. The Trustee makes no representations as to the
validity or sufficiency of this Agreement or of the Certificates (except that
the Certificates shall be duly and validly executed and authenticated by it
as Certificate Registrar) or of any Mortgage Loan or related document, or of
MERS or the MERS(R)System. Except as otherwise provided herein, the Trustee
shall not be accountable for the use or application by the Company or the
Master Servicer of any of the Certificates or of the proceeds of such
Certificates, or for the use or application of any funds paid to the Company
or the Master Servicer in respect of the Mortgage Loans or deposited in or
withdrawn from the Custodial Account or the Certificate Account by the
Company or the Master Servicer.
Section 8.04. Trustee May Own Certificates.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Certificates with the same rights it would have if it
were not Trustee.
Section 8.05. Master Servicer to Pay Trustee's Fees
and Expenses; Indemnification.
(a) The Master Servicer covenants and agrees to pay to the Trustee and any
co-trustee from time to time, and the Trustee and any co-trustee shall be
entitled to, reasonable compensation (which shall not be limited by any
provision of law in regard to the compensation of a trustee of an express
trust) for all services rendered by each of them in the execution of the
trusts hereby created and in the exercise and performance of any of the
powers and duties hereunder of the Trustee and any co-trustee, and the Master
Servicer will pay or reimburse the Trustee and any co-trustee upon request
for all reasonable expenses, disbursements and advances incurred or made by
the Trustee or any co-trustee in accordance with any of the provisions of
this Agreement (including the reasonable compensation and the expenses and
disbursements of its counsel and of all persons not regularly in its employ,
and the expenses incurred by the Trustee or any co-trustee in connection with
the appointment of an office or agency pursuant to Section 8.12) except any
such expense, disbursement or advance as may arise from its negligence or bad
faith.
(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
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.
The Trustee hereunder shall at all times be a corporation or a national
banking association having its principal office in a state and city
acceptable to the Company and organized and doing business under the laws of
such state or the United States of America, authorized under such laws to
exercise corporate trust powers, having a combined capital and surplus of at
least $50,000,000, subject to supervision or examination by federal or state
authority and the short-term rating of such institution shall be A-1 in the
case of Standard & Poor's if Standard & Poor's is a Rating Agency. If such
corporation or national banking association publishes reports of condition at
least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then for the purposes of this Section the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of
condition so published. In case at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section, the Trustee shall
resign immediately in the manner and with the effect specified in Section
8.07.
Section 8.07. Resignation and Removal of the Trustee.
(a) The Trustee may at any time resign and be discharged from the trusts
hereby created by giving written notice thereof to the Company. Upon
receiving such notice of resignation, the Company shall promptly appoint a
successor trustee by written instrument, in duplicate, one copy of which
instrument shall be delivered to the resigning Trustee and one copy to the
successor trustee. If no successor trustee shall have been so appointed and
have accepted appointment within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee.
(b) If at any time the Trustee shall cease to be eligible in accordance
with the provisions of Section 8.06 and shall fail to resign after written
request therefor by the Company, or if at any time the Trustee shall become
incapable of acting, or shall be adjudged bankrupt or insolvent, or a
receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, then
the Company may remove the Trustee and appoint a successor trustee by written
instrument, in duplicate, one copy of which instrument shall be delivered to
the Trustee so removed and one copy to the successor trustee. In addition,
in the event that the Company determines that the Trustee has failed (i) to
distribute or cause to be distributed to the Certificateholders any amount
required to be distributed hereunder, if such amount is held by the Trustee
or its Paying Agent (other than the Master Servicer or the Company) for
distribution or (ii) to otherwise observe or perform in any material respect
any of its covenants, agreements or obligations hereunder, and such failure
shall continue unremedied for a period of 5 days (in respect of clause (i)
above) or 30 days (in respect of clause (ii) above other than any failure to
comply with the provisions of Article XII, in which case no notice or grace
period shall be applicable) after the date on which written notice of such
failure, requiring that the same be remedied, shall have been given to the
Trustee by the Company, then the Company may remove the Trustee and appoint a
successor trustee by written instrument delivered as provided in the
preceding sentence. In connection with the appointment of a successor
trustee pursuant to the preceding sentence, the Company shall, on or before
the date on which any such appointment becomes effective, obtain from each
Rating Agency written confirmation that the appointment of any such successor
trustee will not result in the reduction of the ratings on any class of the
Certificates below the lesser of the then current or original ratings on such
Certificates.
(c) The Holders of Certificates entitled to at least 51% of the Voting
Rights may at any time remove the Trustee and appoint a successor trustee by
written instrument or instruments, in triplicate, signed by such Holders or
their attorneys-in-fact duly authorized, one complete set of which
instruments shall be delivered to the Company, one complete set to the
Trustee so removed and one complete set to the successor so appointed.
(d) Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section shall
become effective upon acceptance of appointment by the successor trustee as
provided in Section 8.08.
Section 8.08. Successor Trustee.
(a) Any successor trustee appointed as provided in Section 8.07 shall
execute, acknowledge and deliver to the Company and to its predecessor
trustee an instrument accepting such appointment hereunder, and thereupon the
resignation or removal of the predecessor trustee shall become effective and
such successor trustee shall become effective and such successor trustee,
without any further act, deed or conveyance, shall become fully vested with
all the rights, powers, duties and obligations of its predecessor hereunder,
with the like effect as if originally named as trustee herein. The
predecessor trustee shall deliver to the successor trustee all Custodial
Files and related documents and statements held by it hereunder (other than
any Custodial Files at the time held by a Custodian, which shall become the
agent of any successor trustee hereunder), and the Company, the Master
Servicer and the predecessor trustee shall execute and deliver such
instruments and do such other things as may reasonably be required for more
fully and certainly vesting and confirming in the successor trustee all such
rights, powers, duties and obligations.
(b) No successor trustee shall accept appointment as provided in this
Section unless at the time of such acceptance such successor trustee shall be
eligible under the provisions of Section 8.06.
(c) Upon acceptance of appointment by a successor trustee as provided in
this Section, the Company shall mail notice of the succession of such trustee
hereunder to all Holders of Certificates at their addresses as shown in the
Certificate Register. If the Company fails to mail such notice within 10
days after acceptance of appointment by the successor trustee, the successor
trustee shall cause such notice to be mailed at the expense of the Company.
Section 8.09. Merger or Consolidation of Trustee.
Any corporation or national banking association into which the Trustee
may be merged or converted or with which it may be consolidated or any
corporation or national banking association resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation or national banking association succeeding to the business of the
Trustee, shall be the successor of the Trustee hereunder, provided such
corporation or national banking association shall be eligible under the
provisions of Section 8.06, without the execution or filing of any paper or
any further act on the part of any of the parties hereto, anything herein to
the contrary notwithstanding. The Trustee shall mail notice of any such
merger or consolidation to the Certificateholders at their address as shown
in the Certificate Register.
Section 8.10. Appointment of Co-Trustee or Separate Trustee.
(a) Notwithstanding any other provisions hereof, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any
part of the Trust Fund or property securing the same may at the time be
located, the Master Servicer and the Trustee acting jointly shall have the
power and shall execute and deliver all instruments to appoint one or more
Persons approved by the Trustee to act as co-trustee or co-trustees, jointly
with the Trustee, or separate trustee or separate trustees, of all or any
part of the Trust Fund, and to vest in such Person or Persons, in such
capacity, such title to the Trust Fund, or any part thereof, and, subject to
the other provisions of this Section 8.10, such powers, duties, obligations,
rights and trusts as the Master Servicer and the Trustee may consider
necessary or desirable. If the Master Servicer shall not have joined in such
appointment within 15 days after the receipt by it of a request so to do, or
in case an Event of Default shall have occurred and be continuing, the
Trustee alone shall have the power to make such appointment. No co-trustee
or separate trustee hereunder shall be required to meet the terms of
eligibility as a successor trustee under Section 8.06 hereunder and no notice
to Holders of Certificates of the appointment of co-trustee(s) or separate
trustee(s) shall be required under Section 8.08 hereof.
(b) In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 8.10 all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee, and such separate trustee or
co-trustee jointly, except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed (whether
as Trustee hereunder or as successor to the Master Servicer hereunder), the
Trustee shall be incompetent or unqualified to perform such act or acts, in
which event such rights, powers, duties and obligations (including the
holding of title to the Trust Fund or any portion thereof in any such
jurisdiction) shall be exercised and performed by such separate trustee or
co-trustee at the direction of the Trustee.
(c) Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement
and the conditions of this Article VIII. Each separate trustee and
co-trustee, upon its acceptance of the trusts conferred, shall be vested with
the estates or property specified in its instrument of appointment, either
jointly with the Trustee or separately, as may be provided therein, subject
to all the provisions of this Agreement, specifically including every
provision of this Agreement relating to the conduct of, affecting the
liability of, or affording protection to, the Trustee. Every such instrument
shall be filed with the Trustee.
(d) Any separate trustee or co-trustee may, at any time, constitute the
Trustee, its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of
this Agreement on its behalf and in its name. If any separate trustee or
co-trustee shall die, become incapable of acting, resign or be removed, all
of its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
Section 8.11. Appointment of the Custodian.
The Trustee may, with the consent of the Master Servicer and the
Company, or shall, at the direction of the Company and the Master Servicer,
appoint custodians who are not Affiliates of the Company, the Master Servicer
or any Seller to hold all or a portion of the Custodial Files as agent for
the Trustee, by entering into a Custodial Agreement. Subject to Article
VIII, the Trustee agrees to comply with the terms of each Custodial Agreement
with respect to the Custodial Files and to enforce the terms and provisions
thereof against the related custodian for the benefit of the
Certificateholders. Each custodian shall be a depository institution subject
to supervision by federal or state authority, shall have a combined capital
and surplus of at least $15,000,000 and shall be qualified to do business in
the jurisdiction in which it holds any Custodial File. Each Custodial
Agreement, with respect to the Custodial Files, may be amended only as
provided in Section 11.01. The Trustee shall notify the Certificateholders
of the appointment of any custodian (other than the custodian appointed as of
the Closing Date) pursuant to this Section 8.11.
Section 8.12. Appointment of Office or Agency.
The Trustee will maintain an office or agency in the United States at
the address designated in Section 11.05 of the Series Supplement where
Certificates may be surrendered for registration of transfer or exchange. The
Trustee will maintain an office at the address stated in Section 11.05 of the
Series Supplement where notices and demands to or upon the Trustee in respect
of this Agreement may be served.
ARTICLE IX
TERMINATION OR OPTIONAL PURCHASE OF ALL CERTIFICATES
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) the purchase by the Master Servicer of all Mortgage Loans and all
property acquired in respect of any Mortgage Loan remaining in the
Trust Fund at a price equal to 100% of the unpaid principal balance of
each Mortgage Loan 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
(net of any unreimbursed Advances attributable to principal) 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
portion of any REMIC formed under the Series Supplement as a REMIC.
The purchase price paid by the Master Servicer 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 Compliance With
Laws Representation, that remain unpaid on the date of such purchase.
The right of the Master Servicer to purchase all the assets of the
Trust Fund pursuant to clause (ii) above is conditioned upon the Pool Stated
Principal Balance 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.
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 Custodial Files pertaining to the Mortgage Loans being
purchased.
In addition to the foregoing, on any Distribution Date on which the
Pool Stated Principal Balance, 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, the Master Servicer shall have the
right, at its option, to purchase the 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. If the Master Servicer exercises this right to purchase the
outstanding Certificates, the Master Servicer will promptly terminate the
respective obligations and responsibilities created hereby in respect of the
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 the Master Servicer anticipates that
the final distribution will be made to Certificateholders (whether as a
result of the exercise by the Master Servicer of its right to purchase the
assets of the Trust Fund or otherwise) or on which 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 (if it is exercising its right to purchase the assets of the
Trust Fund or to purchase the outstanding Certificates), or by the Trustee
(in any other case) by letter. Such notice shall be prepared by the Master
Servicer (if it is exercising its right to purchase the assets of the Trust
Fund or to purchase the outstanding Certificates), or by the Trustee (in any
other case) and mailed by the Trustee to the Certificateholders 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 is obligated to give notice to Certificateholders as
aforesaid, 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. As a result of the exercise by the Master Servicer of its
right to purchase the assets of the Trust Fund, 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 for the
assets of the Trust Fund, 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 an Eligible Account,
established by the Master Servicer on behalf of the Trustee and separate from
the Certificate Account in the name of the Trustee in trust for the
registered holders of the Certificates, 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.
(c) In the case of the Senior Certificates, upon presentation and surrender
of the Certificates by the Certificateholders thereof, and in the case of the
Class M and Class B 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 the 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 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 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) If any Certificateholders shall not surrender their Certificates for
final payment and cancellation on or before the Final Distribution Date (if
so required by the terms hereof), the Trustee shall on such date cause all
funds in the Certificate Account not distributed in final distribution to
Certificateholders to be withdrawn therefrom and credited to the remaining
Certificateholders by depositing such funds in a separate escrow account for
the benefit of such Certificateholders, and the Master Servicer (if it
exercised its right to purchase the assets of the Trust Fund), 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
escrow account and of contacting Certificateholders shall be paid out of the
assets which remain in the escrow 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
escrow 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.
(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 Trustee shall on such date cause all funds in
the Certificate Account deposited therein by the Master Servicer pursuant to
Section 9.01(b) to be withdrawn therefrom and deposited in a separate escrow
account for the benefit of such Certificateholders, and 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 escrow account and of contacting Certificateholders shall be
paid out of the assets which remain in the escrow 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 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 escrow 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 escrow account and notices
allocated thereto. Any Certificates so purchased or deemed to have been
purchased on such Distribution Date shall remain outstanding hereunder until
the Master Servicer has terminated the respective obligations and
responsibilities created hereby in respect of the Certificates pursuant to
this Article IX. The Master Servicer shall be for all purposes the Holder
thereof as of such date.
Section 9.02. Additional Termination Requirements.
(a) Each REMIC that comprises the Trust Fund shall be terminated in
accordance with the following additional requirements, unless (subject to
Section 10.01(f)) the Trustee and the Master Servicer have received an
Opinion of Counsel (which Opinion of Counsel shall not be an expense of the
Trustee) to the effect that the failure of each such REMIC to comply with the
requirements of this Section 9.02 will not (i) result in the imposition on
the Trust Fund of taxes on "prohibited transactions," as described in
Section 860F of the Code, or (ii) cause any such REMIC to fail to qualify as
a REMIC at any time that any Certificate is outstanding:
(i) The Master Servicer shall establish a 90-day liquidation period for
each such REMIC and specify the first day of such period in a statement
attached to the Trust Fund's final Tax Return pursuant to Treasury
regulations Section 1.860F-1. The Master Servicer also shall satisfy
all of the requirements of a qualified liquidation for a REMIC under
Section 860F of the Code and regulations thereunder;
(ii) The Master Servicer shall notify the Trustee at the commencement of
such 90-day liquidation period and, at or prior to the time of making
of the final payment on the Certificates, the Trustee shall sell or
otherwise dispose of all of the remaining assets of the Trust Fund in
accordance with the terms hereof; and
(iii) If the Master Servicer or the Company is exercising its right to
purchase the assets of the Trust Fund, the Master Servicer shall,
during the 90-day liquidation period and at or prior to the Final
Distribution Date, purchase all of the assets of the Trust Fund for
cash.
(b) Each Holder of a Certificate and the Trustee hereby irrevocably
approves and appoints the Master Servicer as its attorney-in-fact to adopt a
plan of complete liquidation for each REMIC at the expense of the Trust Fund
in accordance with the terms and conditions of this Agreement.
Section 9.03. Termination of Multiple REMICs.
If the REMIC Administrator makes two or more separate REMIC elections,
the applicable REMIC shall be terminated on the earlier of the Final
Distribution Date and the date on which it is deemed to receive the last
deemed distributions on the related Uncertificated REMIC Regular Interests
and the last distribution due on the Certificates is made.
ARTICLE X
REMIC PROVISIONS
Section 10.01. REMIC Administration.
(a) The REMIC Administrator shall make an election to treat the Trust Fund
as one or more REMICs under the Code and, if necessary, under applicable
state law. The assets of each such REMIC will be set forth in the Series
Supplement. Such election will be made on Form 1066 or other appropriate
federal tax or information return (including Form 8811) or any appropriate
state return for the taxable year ending on the last day of the calendar year
in which the Certificates are issued. For the purposes of each REMIC
election in respect of the Trust Fund, Certificates and interests to be
designated as the "regular interests" and the sole class of "residual
interests" in the REMIC will be set forth in Section 10.03 of the Series
Supplement. The REMIC Administrator and the Trustee shall not permit the
creation of any "interests" (within the meaning of Section 860G of the Code)
in any REMIC elected in respect of the Trust Fund other than the "regular
interests" and "residual interests" so designated.
(b) The Closing Date is hereby designated as the "startup day" of the Trust
Fund within the meaning of Section 860G(a)(9) of the Code.
(c) The REMIC Administrator shall hold a Class R Certificate representing a
0.01% Percentage Interest each Class of the Class R Certificates and shall be
designated as "the tax matters person" with respect to each REMIC in the
manner provided under Treasury regulations section 1.860F-4(d) and Treasury
regulations section 301.6231(a)(7)-1. The REMIC Administrator, as tax matters
person, shall (i) act on behalf of each REMIC in relation to any tax matter
or controversy involving the Trust Fund and (ii) represent the Trust Fund in
any administrative or judicial proceeding relating to an examination or audit
by any governmental taxing authority with respect thereto. The legal
expenses, including without limitation attorneys' or accountants' fees, and
costs of any such proceeding and any liability resulting therefrom shall be
expenses of the Trust Fund and the REMIC Administrator shall be entitled to
reimbursement therefor out of amounts attributable to the Mortgage Loans on
deposit in the Custodial Account as provided by Section 3.10 unless such
legal expenses and costs are incurred by reason of the REMIC Administrator's
willful misfeasance, bad faith or gross negligence. If the REMIC
Administrator is no longer the Master Servicer hereunder, at its option the
REMIC Administrator may continue its duties as REMIC Administrator and shall
be paid reasonable compensation not to exceed $3,000 per year by any
successor Master Servicer hereunder for so acting as the REMIC Administrator.
(d) The REMIC Administrator shall prepare or cause to be prepared all of
the Tax Returns that it determines are required with respect to each REMIC
created hereunder and deliver such Tax Returns in a timely manner to the
Trustee and the Trustee shall sign and file such Tax Returns in a timely
manner. The expenses of preparing such returns shall be borne by the REMIC
Administrator without any right of reimbursement therefor. The REMIC
Administrator agrees to indemnify and hold harmless the Trustee with respect
to any tax or liability arising from the Trustee's signing of Tax Returns
that contain errors or omissions. The Trustee and Master Servicer shall
promptly provide the REMIC Administrator with such information as the REMIC
Administrator may from time to time request for the purpose of enabling the
REMIC Administrator to prepare Tax Returns.
(e) The REMIC Administrator shall provide (i) to any Transferor of a Class
R Certificate such information as is necessary for the application of any tax
relating to the transfer of a Class R Certificate to any Person who is not a
Permitted Transferee, (ii) to the Trustee, and the Trustee shall forward to
the Certificateholders, such information or reports as are required by the
Code or the REMIC Provisions including reports relating to interest, original
issue discount and market discount or premium (using the Prepayment
Assumption) and (iii) to the Internal Revenue Service the name, title,
address and telephone number of the person who will serve as the
representative of each REMIC.
(f) The Master Servicer and the REMIC Administrator shall take such actions
and shall cause each REMIC created hereunder to take such actions as are
reasonably within the Master Servicer's or the REMIC Administrator's control
and the scope of its duties more specifically set forth herein as shall be
necessary or desirable to maintain the status of each REMIC as a REMIC under
the REMIC Provisions (and the Trustee shall assist the Master Servicer and
the REMIC Administrator, to the extent reasonably requested by the Master
Servicer and the REMIC Administrator to do so). The Master Servicer and the
REMIC Administrator shall not knowingly or intentionally take any action,
cause the Trust Fund to take any action or fail to take (or fail to cause to
be taken) any action reasonably within their respective control that, under
the REMIC Provisions, if taken or not taken, as the case may be, could (i)
endanger the status of any portion of any REMIC formed under the Series
Supplement as a REMIC or (ii) result in the imposition of a tax upon any such
REMIC (including but not limited to the tax on prohibited transactions as
defined in Section 860F(a)(2) of the Code and the tax on contributions to a
REMIC set forth in Section 860G(d) of the Code) (either such event, in the
absence of an Opinion of Counsel or the indemnification referred to in this
sentence, an "Adverse REMIC Event") unless the Master Servicer or the REMIC
Administrator, as applicable, has received an Opinion of Counsel (at the
expense of the party seeking to take such action or, if such party fails to
pay such expense, and the Master Servicer or the REMIC Administrator, as
applicable, determines that taking such action is in the best interest of the
Trust Fund and the Certificateholders, at the expense of the Trust Fund, but
in no event at the expense of the Master Servicer, the REMIC Administrator or
the Trustee) to the effect that the contemplated action will not, with
respect to each REMIC created hereunder, endanger such status or, unless the
Master Servicer, the REMIC Administrator or both, as applicable, determine in
its or their sole discretion to indemnify the Trust Fund against the
imposition of such a tax, result in the imposition of such a tax. Wherever in
this Agreement a contemplated action may not be taken because the timing of
such action might result in the imposition of a tax on the Trust Fund, or may
only be taken pursuant to an Opinion of Counsel that such action would not
impose a tax on the Trust Fund, such action may nonetheless be taken provided
that the indemnity given in the preceding sentence with respect to any taxes
that might be imposed on the Trust Fund has been given and that all other
preconditions to the taking of such action have been satisfied. The Trustee
shall not take or fail to take any action (whether or not authorized
hereunder) as to which the Master Servicer or the REMIC Administrator, as
applicable, has advised it in writing that it has received an Opinion of
Counsel to the effect that an Adverse REMIC Event could occur with respect to
such action. In addition, prior to taking any action with respect to any
REMIC created hereunder or any related assets thereof, or causing any such
REMIC to take any action, which is not expressly permitted under the terms of
this Agreement, the Trustee will consult with the Master Servicer or the
REMIC Administrator, as applicable, or its designee, in writing, with respect
to whether such action could cause an Adverse REMIC Event to occur with
respect to any such REMIC, and the Trustee shall not take any such action or
cause any such REMIC to take any such action as to which the Master Servicer
or the REMIC Administrator, as applicable, has advised it in writing that an
Adverse REMIC Event could occur. The Master Servicer or the REMIC
Administrator, as applicable, may consult with counsel to make such written
advice, and the cost of same shall be borne by the party seeking to take the
action not expressly permitted by this Agreement, but in no event at the
expense of the Master Servicer or the REMIC Administrator. At all times as
may be required by the Code, the Master Servicer will to the extent within
its control and the scope of its duties more specifically set forth herein,
maintain substantially all of the assets of each REMIC created hereunder as
"qualified mortgages" as defined in Section 860G(a)(3) of the Code and
"permitted investments" as defined in Section 860G(a)(5) of the Code.
(g) In the event that any tax is imposed on "prohibited transactions" of
any REMIC created hereunder as defined in Section 860F(a)(2) of the Code, on
"net income from foreclosure property" of any such REMIC as defined in
Section 860G(c) of the Code, on any contributions to any such REMIC after the
Startup Day therefor pursuant to Section 860G(d) of the Code, or any other
tax is imposed by the Code or any applicable provisions of state or local tax
laws, such tax shall be charged (i) to the Master Servicer, if such tax
arises out of or results from a breach by the Master Servicer of any of its
obligations under this Agreement or the Master Servicer has in its sole
discretion determined to indemnify the Trust Fund against such tax, (ii) to
the Trustee, if such tax arises out of or results from a breach by the
Trustee of any of its obligations under this Article X, or (iii) otherwise
against amounts on deposit in the Custodial Account as provided by Section
3.10 and on the Distribution Date(s) following such reimbursement the
aggregate of such taxes shall be allocated in reduction of the Accrued
Certificate Interest on each Class entitled thereto in the same manner as if
such taxes constituted a Prepayment Interest Shortfall.
(h) The Trustee and the Master Servicer shall, for federal income tax
purposes, maintain books and records with respect to each REMIC created
hereunder on a calendar year and on an accrual basis or as otherwise may be
required by the REMIC Provisions.
(i) Following the Startup Day, neither the Master Servicer nor the Trustee
shall accept any contributions of assets to any REMIC created hereunder
unless (subject to Section 10.01(f)) the Master Servicer and the Trustee
shall have received an Opinion of Counsel (at the expense of the party
seeking to make such contribution) to the effect that the inclusion of such
assets in such REMIC will not cause the REMIC to fail to qualify as a REMIC
at any time that any Certificates are outstanding or subject the REMIC to any
tax under the REMIC Provisions or other applicable provisions of federal,
state and local law or ordinances.
(j) Neither the Master Servicer nor the Trustee shall (subject to Section
10.01(f)) enter into any arrangement by which any REMIC created hereunder
will receive a fee or other compensation for services nor permit any such
REMIC to receive any income from assets other than "qualified mortgages" as
defined in Section 860G(a)(3) of the Code or "permitted investments" as
defined in Section 860G(a)(5) of the Code.
(k) Solely for the purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
Regulations, the "latest possible maturity date" by which the Certificate
Principal Balance of each Class of Certificates (other than the Interest Only
Certificates) representing a regular interest in the applicable REMIC and the
Uncertificated Principal Balance of each Uncertificated REMIC Regular
Interest (other than each Uncertificated REMIC Regular Interest represented
by a Class A-V Certificate, if any) and the rights to the Interest Only
Certificates and Uncertificated REMIC Regular Interest represented by a Class
A-V Certificate would be reduced to zero is the Maturity Date for each such
Certificate and Interest.
(l) Within 30 days after the Closing Date, the REMIC Administrator shall
prepare and file with the Internal Revenue Service Form 8811, "Information
Return for Real Estate Mortgage Investment Conduits (REMIC) and Issuers of
Collateralized Debt Obligations" for each REMIC created hereunder.
(m) Neither the Trustee nor the Master Servicer shall sell, dispose of or
substitute for any of the Mortgage Loans (except in connection with (i) the
default, imminent default or foreclosure of a Mortgage Loan, including but
not limited to, the acquisition or sale of a Mortgaged Property acquired by
deed in lieu of foreclosure, (ii) the bankruptcy of any REMIC created
hereunder, (iii) the termination of any such REMIC pursuant to Article IX of
this Agreement or (iv) a purchase of Mortgage Loans pursuant to Article II or
III of this Agreement) nor acquire any assets for any such REMIC, nor sell or
dispose of any investments in the Custodial Account or the Certificate
Account for gain nor accept any contributions to any such REMIC after the
Closing Date unless it has received an Opinion of Counsel that such sale,
disposition, substitution or acquisition will not (a) affect adversely the
status of such REMIC as a REMIC or (b) unless the Master Servicer has
determined in its sole discretion to indemnify the Trust Fund against such
tax, cause such REMIC to be subject to a tax on "prohibited transactions" or
"contributions" pursuant to the REMIC Provisions.
Section 10.02. Master Servicer, REMIC Administrator and Trustee
Indemnification.
(a) The Trustee agrees to indemnify the Trust Fund, the Company, the REMIC
Administrator and the Master Servicer for any taxes and costs including,
without limitation, any reasonable attorneys fees imposed on or incurred by
the Trust Fund, the Company or the Master Servicer, as a result of a breach
of the Trustee's covenants set forth in Article VIII or this Article X.
(b) The REMIC Administrator agrees to indemnify the Trust Fund, the
Company, the Master Servicer and the Trustee for any taxes and costs
(including, without limitation, any reasonable attorneys' fees) imposed on or
incurred by the Trust Fund, the Company, the Master Servicer or the Trustee,
as a result of a breach of the REMIC Administrator's covenants set forth in
this Article X with respect to compliance with the REMIC Provisions,
including without limitation, any penalties arising from the Trustee's
execution of Tax Returns prepared by the REMIC Administrator that contain
errors or omissions; provided, however, that such liability will not be
imposed to the extent such breach is a result of an error or omission in
information provided to the REMIC Administrator by the Master Servicer in
which case Section 10.02(c) will apply.
(c) The Master Servicer agrees to indemnify the Trust Fund, the Company,
the REMIC Administrator and the Trustee for any taxes and costs (including,
without limitation, any reasonable attorneys' fees) imposed on or incurred by
the Trust Fund, the Company, the REMIC Administrator or the Trustee, as a
result of a breach of the Master Servicer's covenants set forth in this
Article X or in Article III with respect to compliance with the REMIC
Provisions, including without limitation, any penalties arising from the
Trustee's execution of Tax Returns prepared by the Master Servicer that
contain errors or omissions.
Section 10.03. Designation of REMIC(s).
As provided in Section 10.03 of the Series Supplement.
Section 10.04. Distributions on the Uncertificated REMIC I and REMIC II
Regular Interests.
As provided in Section 10.04 of the Series Supplement.
Section 10.05. Compliance with Withholding Requirements.
As provided in Section 10.05 of the Series Supplement.
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01. Amendment.
(a) This Agreement or any Custodial Agreement may be amended from time to
time by the Company, the Master Servicer and the Trustee, without the consent
of any of the Certificateholders:
(i) to cure any ambiguity,
(ii) to correct or supplement any provisions herein or therein, which may be
inconsistent with any other provisions herein or therein or to correct
any error,
(iii) to modify, eliminate or add to any of its provisions to such extent as
shall be necessary or desirable to maintain the qualification of the
Trust Fund as a REMIC at all times that any Certificate is outstanding
or to avoid or minimize the risk of the imposition of any tax on the
Trust Fund pursuant to the Code that would be a claim against the Trust
Fund, provided that the Trustee has received an Opinion of Counsel to
the effect that (A) such action is necessary or desirable to maintain
such qualification or to avoid or minimize the risk of the imposition
of any such tax and (B) such action will not adversely affect in any
material respect the interests of any Certificateholder,
(iv) to change the timing and/or nature of deposits into the Custodial
Account or the Certificate Account or to change the name in which the
Custodial Account is maintained, provided that (A) the Certificate
Account Deposit Date shall in no event be later than the related
Distribution Date, (B) such change shall not, as evidenced by an
Opinion of Counsel, adversely affect in any material respect the
interests of any Certificateholder and (C) such change shall not result
in a reduction of the rating assigned to any Class of Certificates
below the lower of the then-current rating or the rating assigned to
such Certificates as of the Closing Date (in the case of the Insured
Certificates (as defined in the Series Supplement), such determination
shall be made without giving effect to the Certificate Policy (as
defined in the Series Supplement)), as evidenced by a letter from each
Rating Agency to such effect,
(v) to modify, eliminate or add to the provisions of Section 5.02(f) or any
other provision hereof restricting transfer of the Class R
Certificates, by virtue of their being the "residual interests" in a
REMIC, provided that (A) such change shall not result in reduction of
the rating assigned to any such Class of Certificates below the lower
of the then-current rating or the rating assigned to such Certificates
as of the Closing Date (in the case of the Insured Certificates (as
defined in the Series Supplement), such determination shall be made
without giving effect to the Certificate Policy (as defined in the
Series Supplement)), as evidenced by a letter from each Rating Agency
to such effect, and (B) such change shall not (subject to Section
10.01(f)), as evidenced by an Opinion of Counsel (at the expense of the
party seeking so to modify, eliminate or add such provisions), cause
any REMIC created hereunder or any of the Certificateholders (other
than the transferor) to be subject to a federal tax caused by a
transfer to a Person that is not a Permitted Transferee,
(vi) to make any other provisions with respect to matters or questions
arising under this Agreement or such Custodial Agreement which shall
not be materially inconsistent with the provisions of this Agreement,
provided that such action shall not, as evidenced by an Opinion of
Counsel, adversely affect in any material respect the interests of any
Certificateholder or
(vii) to amend any provision herein or therein that is not
material to any of the Certificateholders.
(b) This Agreement or any Custodial Agreement may also be amended from time
to 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 with a Certificate
Principal Balance greater than zero affected thereby for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Agreement or such Custodial Agreement or of modifying in
any manner the rights of the Holders of Certificates of such Class; provided,
however, that no such amendment shall:
(i) reduce in any manner the amount of, or delay the timing of, payments
which are required to be distributed on any Certificate without the
consent of the Holder of such Certificate,
(ii) reduce the aforesaid percentage of Certificates of any Class the
Holders of which are required to consent to any such amendment, in any
such case without the consent of the Holders of all Certificates of
such Class then outstanding.
(c) Notwithstanding any contrary provision of this Agreement, the Trustee
shall not consent to any amendment to this Agreement unless it shall have
first received an Opinion of Counsel (subject to Section 10.01(f) and at the
expense of the party seeking such amendment) to the effect that such
amendment or the exercise of any power granted to the Master Servicer, the
Company or the Trustee in accordance with such amendment is permitted
hereunder and will not result in the imposition of a federal tax on the Trust
Fund or cause any REMIC created under the Series Supplement to fail to
qualify as a REMIC at any time that any Certificate is outstanding.
(d) Promptly after the execution of any such amendment the Trustee shall
furnish written notification of the substance of such amendment to the
Custodian and each Certificateholder. It shall not be necessary for the
consent of Certificateholders under this Section 11.01 to approve the
particular form of any proposed amendment, but it shall be sufficient if such
consent shall approve the substance thereof. The manner of obtaining such
consents and of evidencing the authorization of the execution thereof by
Certificateholders shall be subject to such reasonable regulations as the
Trustee may prescribe.
(e) The Company shall have the option, in its sole discretion, to obtain
and deliver to the Trustee any corporate guaranty, payment obligation,
irrevocable letter of credit, surety bond, insurance policy or similar
instrument or a reserve fund, or any combination of the foregoing, for the
purpose of protecting the Holders of the Class B Certificates against any or
all Realized Losses or other shortfalls. Any such instrument or fund shall
be held by the Trustee for the benefit of the Class B Certificateholders, but
shall not be and shall not be deemed to be under any circumstances included
in the Trust Fund. To the extent that any such instrument or fund
constitutes a reserve fund for federal income tax purposes, (i) any reserve
fund so established shall be an outside reserve fund and not an asset of the
Trust Fund, (ii) any such reserve fund shall be owned by the Company, and
(iii) amounts transferred by the Trust Fund to any such reserve fund shall be
treated as amounts distributed by the Trust Fund to the Company or any
successor, all within the meaning of Treasury Regulations Section 1.860G-2(h)
as it reads as of the Cut-off Date. In connection with the provision of any
such instrument or fund, this Agreement and any provision hereof may be
modified, added to, deleted or otherwise amended in any manner that is
related or incidental to such instrument or fund or the establishment or
administration thereof, such amendment to be made by written instrument
executed or consented to by the Company but without the consent of any
Certificateholder and without the consent of the Master Servicer or the
Trustee being required unless any such amendment would impose any additional
obligation on, or otherwise adversely affect the interests of the Senior
Certificateholders, the Class M Certificateholders, the Master Servicer or
the Trustee, as applicable; provided that the Company obtains (subject to
Section 10.01(f)) an Opinion of Counsel (which need not be an opinion of
Independent counsel) to the effect that any such amendment will not cause (a)
any federal tax to be imposed on the Trust Fund, including without
limitation, any federal tax imposed on "prohibited transactions" under
Section 860F(a)(1) of the Code or on "contributions after the startup date"
under Section 860G(d)(1) of the Code and (b) any REMIC created hereunder to
fail to qualify as a REMIC at any time that any Certificate is outstanding.
In the event that the Company elects to provide such coverage in the form of
a limited guaranty provided by GMAC LLC, the Company may elect that the text
of such amendment to this Agreement shall be substantially in the form
attached hereto as Exhibit K (in which case Residential Funding's Subordinate
Certificate Loss Obligation as described in such exhibit shall be established
by Residential Funding's consent to such amendment) and that the limited
guaranty shall be executed in the form attached hereto as Exhibit L, with
such changes as the Company shall deem to be appropriate; it being understood
that the Trustee has reviewed and approved the content of such forms and that
the Trustee's consent or approval to the use thereof is not required.
Section 11.02. Recordation of Agreement; Counterparts.
(a) To the extent permitted by applicable law, this Agreement is subject to
recordation in all appropriate public offices for real property records in
all the counties or other comparable jurisdictions in which any or all of the
properties subject to the Mortgages are situated, and in any other
appropriate public recording office or elsewhere, such recordation to be
effected by the Master Servicer and at its expense on direction by the
Trustee (pursuant to the request of Holders of Certificates entitled to at
least 25% of the Voting Rights), but only upon direction accompanied by an
Opinion of Counsel to the effect that such recordation materially and
beneficially affects the interests of the Certificateholders.
(b) For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts
shall be deemed to be an original, and such counterparts shall constitute but
one and the same instrument.
Section 11.03. Limitation on Rights of Certificateholders.
(a) The death or incapacity of any Certificateholder shall not operate to
terminate this Agreement or the Trust Fund, nor entitle such
Certificateholder's legal representatives or heirs to claim an accounting or
to take any action or proceeding in any court for a partition or winding up
of the Trust Fund, nor otherwise affect the rights, obligations and
liabilities of any of the parties hereto.
(b) No Certificateholder shall have any right to vote (except as expressly
provided herein) or in any manner otherwise control the operation and
management of the Trust Fund, or the obligations of the parties hereto, nor
shall anything herein set forth, or contained in the terms of the
Certificates, be construed so as to constitute the Certificateholders from
time to time as partners or members of an association; nor shall any
Certificateholder be under any liability to any third person by reason of any
action taken by the parties to this Agreement pursuant to any provision
hereof.
(c) No Certificateholder shall have any right by virtue of any provision of
this Agreement to institute any suit, action or proceeding in equity or at
law upon or under or with respect to this Agreement, unless such Holder
previously shall have given to the Trustee a written notice of default and of
the continuance thereof, as hereinbefore provided, and unless also the
Holders of Certificates of any Class evidencing in the aggregate not less
than 25% of the related Percentage Interests of such Class, shall have made
written request upon the Trustee to institute such action, suit or proceeding
in its own name as Trustee hereunder and shall have offered to the Trustee
such reasonable indemnity as it may require against the costs, expenses and
liabilities to be incurred therein or thereby, and the Trustee, for 60 days
after its receipt of such notice, request and offer of indemnity, shall have
neglected or refused to institute any such action, suit or proceeding it
being understood and intended, and being expressly covenanted by each
Certificateholder with every other Certificateholder and the Trustee, that no
one or more Holders of Certificates of any Class shall have any right in any
manner whatever by virtue of any provision of this Agreement to affect,
disturb or prejudice the rights of the Holders of any other of such
Certificates of such Class or any other Class, or to obtain or seek to obtain
priority over or preference to any other such Holder, or to enforce any right
under this Agreement, except in the manner herein provided and for the common
benefit of Certificateholders of such Class or all Classes, as the case may
be. For the protection and enforcement of the provisions of this Section
11.03, each and every Certificateholder and the Trustee shall be entitled to
such relief as can be given either at law or in equity.
Section 11.04. Governing Law.
This agreement and the Certificates shall be governed by and construed
in accordance with the laws of the State of New York and the obligations,
rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
Section 11.05. Notices.
As provided in Section 11.05 of the Series Supplement.
Section 11.06. Required Notices to Rating Agency and Subservicer.
The Company, the Master Servicer or the Trustee, as applicable, (i)
shall notify each Rating Agency at such time as it is otherwise required
pursuant to this Agreement to give notice of the occurrence of, any of the
events described in clause (a), (b), (c), (d), (g), (h), (i) or (j) below,
(ii) shall notify the Subservicer at such time as it is otherwise required
pursuant to this Agreement to give notice of the occurrence of, any of the
events described in clause (a), (b), (c)(1), (g)(1), or (i) below, or (iii)
provide a copy to each Rating Agency at such time as otherwise required to be
delivered pursuant to this Agreement of any of the statements described in
clauses (e) and (f) below:
(a) a material change or amendment to this Agreement,
(b) the occurrence of an Event of Default,
(c) (1) the termination or appointment of a successor Master Servicer or
(2) the termination or appointment of a successor Trustee or a change
in the majority ownership of the Trustee,
(d) the filing of any claim under the Master Servicer's blanket fidelity
bond and the errors and omissions insurance policy required by Section
3.12 or the cancellation or modification of coverage under any such
instrument,
(e) the statement required to be delivered to the Holders of each Class of
Certificates pursuant to Section 4.03,
(f) the statements required to be delivered pursuant to Sections 3.18 and
3.19,
(g) (1) a change in the location of the Custodial Account or (2) a change
in the location of the Certificate Account,
(h) the occurrence of any monthly cash flow shortfall to the Holders of any
Class of Certificates resulting from the failure by the Master Servicer
to make an Advance pursuant to Section 4.04,
(i) the occurrence of the Final Distribution Date, and
(j) the repurchase of or substitution for any Mortgage Loan,
provided, however, that with respect to notice of the occurrence of the
events described in clauses (d), (g) or (h) above, the Master Servicer shall
provide prompt written notice to each Rating Agency and the Subservicer, if
applicable, of any such event known to the Master Servicer.
Section 11.07. Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall be for any reason whatsoever held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and
shall in no way affect the validity or enforceability of the other provisions
of this Agreement or of the Certificates or the rights of the Holders thereof.
Section 11.08. Supplemental Provisions for Resecuritization.
This Agreement may be supplemented by means of the addition of a
separate Article hereto (a "Supplemental Article") for the purpose of
resecuritizing any of the Certificates issued hereunder, under the following
circumstances. With respect to any Class or Classes of Certificates issued
hereunder, or any portion of any such Class, as to which the Company or any
of its Affiliates (or any designee thereof) is the registered Holder (the
"Resecuritized Certificates"), the Company may deposit such Resecuritized
Certificates into a new REMIC, grantor trust or custodial arrangement (a
"Restructuring Vehicle") to be held by the Trustee pursuant to a Supplemental
Article. The instrument adopting such Supplemental Article shall be executed
by the Company, the Master Servicer and the Trustee; provided, that neither
the Master Servicer nor the Trustee shall withhold their consent thereto if
their respective interests would not be materially adversely affected
thereby. To the extent that the terms of the Supplemental Article do not in
any way affect any provisions of this Agreement as to any of the Certificates
initially issued hereunder, the adoption of the Supplemental Article shall
not constitute an "amendment" of this Agreement.
Each Supplemental Article shall set forth all necessary provisions
relating to the holding of the Resecuritized Certificates by the Trustee, the
establishment of the Restructuring Vehicle, the issuing of various classes of
new certificates by the Restructuring Vehicle and the distributions to be
made thereon, and any other provisions necessary for the purposes thereof.
In connection with each Supplemental Article, the Company shall deliver to
the Trustee an Opinion of Counsel to the effect that (i) the Restructuring
Vehicle will qualify as a REMIC, grantor trust or other entity not subject to
taxation for federal income tax purposes and (ii) the adoption of the
Supplemental Article will not endanger the status of the Trust Fund as a
REMIC or (subject to Section 10.01(f)) result in the imposition of a tax upon
the Trust Fund (including but not limited to the tax on prohibited
transactions as defined in Section 860F(a)(2) of the Code and the tax on
contributions to a REMIC as set forth in Section 860G(d) of the Code).
Section 11.09. Allocation of Voting Rights.
As provided in Section 11.09 of the Series Supplement.
Section 11.10. No Petition.
As provided in Section 11.10 of the Series Supplement.
ARTICLE XII
COMPLIANCE WITH REGULATION AB
Section 12.01. Intent of the Parties; Reasonableness.
The Company, the Trustee and the Master Servicer acknowledge and
agree that the purpose of this Article XII is to facilitate compliance by the
Company with the provisions of Regulation AB and related rules and
regulations of the Commission. The Company shall not exercise its right to
request delivery of information or other performance under these provisions
other than in good faith, or for purposes other than compliance with the
Securities Act, the Exchange Act and the rules and regulations of the
Commission under the Securities Act and the Exchange Act. Each of the Master
Servicer and the Trustee acknowledges that interpretations of the
requirements of Regulation AB may change over time, whether due to
interpretive guidance provided by the Commission or its staff, consensus
among participants in the mortgage-backed securities markets, advice of
counsel, or otherwise, and agrees to comply with reasonable requests made by
the Company in good faith for delivery of information under these provisions
on the basis of evolving interpretations of Regulation AB. Each of the
Master Servicer and the Trustee shall cooperate reasonably with the Company
to deliver to the Company (including any of its assignees or designees), any
and all disclosure, statements, reports, certifications, records and any
other information necessary in the reasonable, good faith determination of
the Company to permit the Company to comply with the provisions of Regulation
AB.
Section 12.02. Additional Representations and Warranties of the Trustee.
(a) The Trustee shall be deemed to represent and warrant to the
Company as of the Closing Date and on each date on which information is
provided to the Company under Sections 12.01, 12.02(b) or 12.03 that, except
as disclosed in writing to the Company prior to such date: (i) it is not
aware and has not received notice that any default, early amortization or
other performance triggering event has occurred as to any other
Securitization Transaction due to any default of the Trustee; (ii) there are
no aspects of its financial condition that could have a material adverse
effect on the performance by it of its trustee obligations under this
Agreement or any other Securitization Transaction as to which it is the
trustee; (iii) there are no material legal or governmental proceedings
pending (or known to be contemplated) against it that would be material to
Certificateholders; (iv) there are no relationships or transactions (as
described in Item 1119(b) of Regulation AB) relating to the Trustee with
respect to the Company or any sponsor, issuing entity, servicer, trustee,
originator, significant obligor, enhancement or support provider or other
material transaction party (as each of such terms are used in Regulation AB)
relating to the Securitization Transaction contemplated by the Agreement, as
identified by the Company to the Trustee in writing as of the Closing Date
(each, a "Transaction Party") that are outside the ordinary course of
business or on terms other than would be obtained in an arm's length
transaction with an unrelated third party, apart from the Securitization
Transaction, and that are material to the investors' understanding of the
Certificates; and (v) the Trustee is not an affiliate (as contemplated by
Item 1119(a) of Regulation AB) of any Transaction Party. The Company shall
notify the Trustee of any change in the identity of a Transaction Party after
the Closing Date.
(b) If so requested by the Company on any date following the
Closing Date, the Trustee shall, within five Business Days following such
request, confirm in writing the accuracy of the representations and
warranties set forth in paragraph (a) of this Section or, if any such
representation and warranty is not accurate as of the date of such
confirmation, provide the pertinent facts, in writing, to the Company. Any
such request from the Company shall not be given more than once each calendar
quarter, unless the Company shall have a reasonable basis for questioning the
accuracy of any of the representations and warranties.
Section 12.03. Information to Be Provided by the Trustee.
For so long as the Certificates are outstanding, for the purpose
of satisfying the Company's reporting obligation under the Exchange Act with
respect to any class of Certificates, the Trustee shall provide to the
Company a written description of (a) any litigation or governmental
proceedings pending against the Trustee as of the last day of each calendar
month that would be material to Certificateholders, and (b) any affiliations
or relationships (as described in Item 1119 of Regulation AB) that develop
following the Closing Date between the Trustee and any Transaction Party of
the type described in Section 12.02(a)(iv) or 12.02(a)(v) as of the last day
of each calendar year. Any descriptions required with respect to legal
proceedings, as well as updates to previously provided descriptions, under
this Section 12.03 shall be given no later than five Business Days prior to
the Determination Date following the month in which the relevant event
occurs, and any notices and descriptions required with respect to
affiliations, as well as updates to previously provided descriptions, under
this Section 12.03 shall be given no later than January 31 of the calendar
year following the year in which the relevant event occurs. As of the
related Distribution Date with respect to each Report on Form 10-D with
respect to the Certificates filed by or on behalf of the Company, and as of
March 15 preceding the date each Report on Form 10-K with respect to the
Certificates is filed, the Trustee shall be deemed to represent and warrant
that any information previously provided by the Trustee under this Article
XII is materially correct and does not have any material omissions unless the
Trustee has provided an update to such information. The Company will allow
the Trustee to review any disclosure relating to material litigation against
the Trustee prior to filing such disclosure with the Commission to the extent
the Company changes the information provided by the Trustee.
Section 12.04. Report on Assessment of Compliance and Attestation.
On or before March 15 of each calendar year, the Trustee shall:
(a) deliver to the Company a report (in form and substance reasonably
satisfactory to the Company) regarding the Trustee's assessment of compliance
with the applicable Servicing Criteria during the immediately preceding
calendar year, as required under Rules 13a-18 and 15d-18 of the Exchange Act
and Item 1122 of Regulation AB. Such report shall be signed by an authorized
officer of the Trustee, and shall address each of the Servicing Criteria
specified on Exhibit R hereto; and
(b) deliver to the Company a report of a registered public accounting firm
satisfying the requirements of Rule 2-01 of Regulation S-X under the
Securities Act and the Exchange Act that attests to, and reports on, the
assessment of compliance made by the Trustee and delivered pursuant to the
preceding paragraph. Such attestation shall be in accordance with Rules
1-02(a)(3) and 2-02(g) of Regulation S-X under the Securities Act and the
Exchange Act.
Section 12.05. Indemnification; Remedies.
(a) The Trustee shall indemnify the Company, each affiliate of the Company,
the Master Servicer and each affiliate of the Master Servicer, and the
respective present and former directors, officers, employees and agents of
each of the foregoing, and shall hold each of them harmless from and against
any losses, damages, penalties, fines, forfeitures, legal fees and expenses
and related costs, judgments, and any other costs, fees and expenses that any
of them may sustain arising out of or based upon:
(i)(A) any untrue statement of a material fact
contained or alleged to be contained in any information, report,
certification, accountants' attestation or other material provided under this
Article XII by or on behalf of the Trustee (collectively, the "Trustee
Information"), or (B) the omission or alleged omission to state in the
Trustee Information a material fact required to be stated in the Trustee
Information or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading; or
(ii) any failure by the Trustee to deliver any
information, report, certification or other material when and as required
under this Article XII, other than a failure by the Trustee to deliver an
accountants' attestation.
(b) In the case of any failure of performance described in clause (ii) of
Section 12.05(a), as well as a failure to deliver an accountants'
attestation, the Trustee shall (i) promptly reimburse the Company for all
costs reasonably incurred by the Company in order to obtain the information,
report, certification, accountants' attestation or other material not
delivered by the Trustee as required and (ii) cooperate with the Company to
mitigate any damages that may result from such failure.
(c) The Company and the Master Servicer shall indemnify the Trustee, each
affiliate of the Trustee and the respective present and former directors,
officers, employees and agents of the Trustee, and shall hold each of them
harmless from and against any losses, damages, penalties, fines, forfeitures,
legal fees and expenses and related costs, judgments, and any other costs,
fees and expenses that any of them may sustain arising out of or based upon
(i) any untrue statement of a material fact contained or alleged to be
contained in any information provided under this Agreement by or on behalf of
the Company or Master Servicer for inclusion in any report filed with
Commission under the Exchange Act (collectively, the "RFC Information"), or
(ii) the omission or alleged omission to state in the RFC Information a
material fact required to be stated in the RFC Information or necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading.
(d) Notwithstanding any provision in this Section 12.05 to the contrary,
the parties agree that none of the Trustee, the Company or the Master
Servicer shall be liable to the other for any consequential or punitive
damages whatsoever, whether in contract, tort (including negligence and
strict liability), or any other legal or equitable principle; provided,
however, that such limitation shall not be applicable with respect to third
party claims made against a party.
EXHIBIT A
FORM OF CLASS A CERTIFICATE, [PRINCIPAL ONLY/CLASS A-P] CERTIFICATE AND
[INTEREST ONLY/CLASS A-V] CERTIFICATE
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.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
[THE FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF
APPLYING THE U.S. FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO
THIS CERTIFICATE. THE ISSUE DATE OF THIS CERTIFICATE IS ___________ __,
____. ASSUMING THAT THE MORTGAGE LOANS PREPAY AT [___]% OF THE PREPAYMENT
SPEED ASSUMPTION (AS DESCRIBED IN THE PROSPECTUS SUPPLEMENT), [AND ASSUMING A
CONSTANT PASS-THROUGH RATE EQUAL TO THE INITIAL PASS-THROUGH RATE,] THIS
CERTIFICATE HAS BEEN ISSUED WITH NO MORE THAN $[ ] OF OID PER
[$1,000] [$100,000] OF [INITIAL CERTIFICATE PRINCIPAL BALANCE] [NOTIONAL
AMOUNT], THE YIELD TO MATURITY IS [ ]% AND THE AMOUNT OF OID
ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN $[ ]
PER [$1,000] [$100,000] OF [INITIAL CERTIFICATE PRINCIPAL BALANCE] [NOTIONAL
AMOUNT], COMPUTED USING THE APPROXIMATE METHOD. NO REPRESENTATION IS MADE
THAT THE MORTGAGE LOANS WILL PREPAY AT A RATE BASED ON THE PREPAYMENT SPEED
ASSUMPTION OR AT ANY OTHER RATE OR AS TO THE CONSTANCY OF THE PASS-THROUGH
RATE.]
Certificate No. [ %][Variable] Pass-Through
Rate [based on a Notional Amount]
Class A- Senior
Date of Pooling and Servicing [Percentage Interest: %]
Agreement and Cut-off Date:
___________ 1, ____ Aggregate Initial [Certificate
Principal Balance] [[Interest
First Distribution Date: Only/Class A-V] Notional Amount]
_________ 25, ____ [Subclass Notional Amount] of the
Class A- Certificates:
Master Servicer:
Residential Funding [Initial] [Certificate Principal
Company, LLC Balance] [Interest Only/Class A-V]
[Subclass]
Assumed Final Notional Amount] of this Certificate:
Distribution Date: $ ]
___________ 25, ____
CUSIP 76110F-
MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATE
SERIES ____-___
evidencing a percentage interest in the distributions
allocable to the Class A- Certificates with
respect to a Trust Fund consisting primarily of a
pool of [conventional one- to four-family fixed
interest rate first mortgage loans] 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, LLC 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, LLC or any of
their affiliates. None of the Company, the Master Servicer, GMAC Mortgage
Group, LLC 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 [(obtained by
dividing the [Initial Certificate Principal Balance] [Initial [Interest
Only/Class A-V] Notional Amount] of this Certificate by the aggregate
[Initial Certificate Principal Balance of all Class A- Certificates]
[Initial [Interest Only/Class A-V] Notional Amounts of all [Interest
Only/Class A-V] Certificates], both as specified above)] in certain
distributions with respect to the Trust Fund consisting primarily of an
interest in a pool of [conventional one- to four-family fixed interest rate
first mortgage loans] (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
__________________, 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 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"), 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 A- Certificates on such Distribution
Date. [The [Interest Only/Class A-V] Notional Amount of the [Interest
Only/Class A-V] Certificates as of any date of determination is equal to the
aggregate Stated Principal Balance of the Mortgage Loans corresponding to the
Uncertificated REMIC Regular Interests represented by such [Interest
Only/Class A-V] Certificates.] [The Subclass Notional Amount of the [Interest
Only/Class A-V]- Certificates as of any date of determination is equal to
the aggregate Stated Principal Balance of the Mortgage Loans corresponding to
the Uncertificated REMIC Regular Interests represented by such [Interest
Only/Class A-V]- Certificates immediately prior to such date.] [The
[Interest Only/Class A-V][- ] Certificates have no Certificate Principal
Balance.]
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. The [Initial
Certificate Principal Balance] [Initial [Interest Only/Class A-V] Notional
Amount] [initial Subclass Notional Amount] of this Certificate is set forth
above.] [The Certificate Principal Balance hereof will be reduced to the
extent of distributions allocable to principal and any Realized Losses
allocable hereto.]
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, 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 New 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.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall
for all purposes have the same effect as if set forth at this place.
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: [_________________________],
as Trustee
By: _____________________________________
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class A- Certificates referred to in the
within-mentioned Agreement.
[___________________________],
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 A-1
FORM OF CLASS X CERTIFICATE
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.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE
OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
Certificate No. ____ Variable Pass-Through Rate
Class X Senior
Date of Pooling and Servicing Agreement Percentage Interest: 100%
and Cut-off Date: __________ 1, ____
Master Servicer: Aggregate Initial Notional Amount of
Residential Funding Company, LLC the Class X Certificates: $__________
First Distribution Date: Initial Notional Amount of this
__________ 25, ____ Certificate: $_____________
Assumed Final Distribution Date: CUSIP ________
_____________
MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATE
SERIES ____-____
Evidencing a percentage interest in the distributions allocable
to the Class X Certificates 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] 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, LLC 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, LLC or any of their
affiliates. None of the Company, the Master Servicer, GMAC Mortgage Group,
LLC 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 (obtained by
dividing the Initial Notional Amount of this Certificate by the Aggregate
Notional Amount of all Class X Certificates, both as specified above) in
certain distributions with respect to the Trust Fund consisting primarily of
an interest in 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
________________________, 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 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"), from the Available Distribution Amount 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 X Certificates on such
Distribution Date. The Class X Certificates have no Certificate Principal
Balance.
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. The Initial Notional Amount of
this Certificate is set forth above.
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, 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 New 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.
Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
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: [_________________________],
as Trustee
By: _____________________________________
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class A- Certificates referred to in the
within-mentioned Agreement.
[___________________________],
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 B
FORM OF CLASS M CERTIFICATE
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE SENIOR
CERTIFICATES [CLASS M-1 CERTIFICATES] [AND CLASS M-2 CERTIFICATES] AS
DESCRIBED IN THE AGREEMENT (AS DEFINED BELOW).
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 (THE "CODE").
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF
APPLYING THE U.S. FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO
THIS CERTIFICATE. THE ISSUE DATE OF THIS CERTIFICATE IS ___________ __,
____. ASSUMING THAT THE MORTGAGE LOANS PREPAY AT [___]% OF THE PREPAYMENT
SPEED ASSUMPTION (AS DESCRIBED IN THE PROSPECTUS SUPPLEMENT), THIS
CERTIFICATE HAS BEEN ISSUED WITH NO MORE THAN $[____] OF OID PER $[1,000] OF
INITIAL CERTIFICATE PRINCIPAL BALANCE, THE YIELD TO MATURITY IS [_____]% AND
THE AMOUNT OF OID ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN
$[____] PER $[1,000] OF INITIAL CERTIFICATE PRINCIPAL BALANCE, COMPUTED UNDER
THE APPROXIMATE METHOD. NO REPRESENTATION IS MADE THAT THE MORTGAGE LOANS
WILL PREPAY AT A RATE BASED ON THE PREPAYMENT SPEED ASSUMPTION OR AT ANY
OTHER RATE.
ANY TRANSFEREE OF THIS CERTIFICATE WILL BE DEEMED TO HAVE
REPRESENTED BY VIRTUE OF ITS PURCHASE OR HOLDING OF THIS CERTIFICATE
(OR INTEREST HEREIN) THAT EITHER (A) SUCH TRANSFEREE IS NOT AN
INVESTMENT MANAGER, A NAMED FIDUCIARY OR A TRUSTEE OF ANY PLAN, OR ANY
OTHER PERSON, ACTING, DIRECTLY OR INDIRECTLY, ON BEHALF OF OR
PURCHASING ANY CERTIFICATE WITH "PLAN ASSETS" OF ANY PLAN (A "PLAN
INVESTOR"), (B) IT HAS ACQUIRED AND IS HOLDING SUCH CERTIFICATE IN
RELIANCE ON PROHIBITED TRANSACTION EXEMPTION ("PTE") 94-29, AS MOST
RECENTLY AMENDED, 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) (I) THE TRANSFEREE IS AN INSURANCE COMPANY, (II) THE SOURCE OF
FUNDS TO BE USED BY IT TO PURCHASE THE CERTIFICATE IS AN "INSURANCE
COMPANY GENERAL ACCOUNT" (WITHIN THE MEANING OF 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 (C), A "COMPLYING
INSURANCE COMPANY).
IF THIS CERTIFICATE (OR ANY INTEREST HEREIN) IS ACQUIRED OR HELD
BY ANY PERSON THAT DOES NOT SATISFY THE CONDITIONS DESCRIBED IN THE
PRECEDING PARAGRAPH, 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 THIS CERTIFICATE. THE TRUSTEE SHALL BE UNDER NO
LIABILITY TO ANY PERSON FOR MAKING ANY PAYMENTS DUE ON THIS CERTIFICATE
TO SUCH PRECEDING TRANSFEREE.
ANY PURPORTED CERTIFICATE OWNER WHOSE ACQUISITION OR HOLDING OF THIS
CERTIFICATE (OR INTEREST HEREIN) WAS EFFECTED IN VIOLATION OF THE
RESTRICTIONS IN SECTION 5.02(e) OF THE POOLING AND SERVICING AGREEMENT SHALL
INDEMNIFY AND HOLD HARMLESS THE COMPANY, THE TRUSTEE, THE MASTER SERVICER,
ANY SUBSERVICER, 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.
Certificate No. [ ]% Pass-Through Rate
Class M- Subordinate Aggregate Certificate
Principal Balance
Date of Pooling and Servicing of the Class M Certificates:
Agreement and Cut-off Date: $
___________ 1, ____
Initial Certificate Principal
First Distribution Date: Balance of this Certificate:
_________ 25, ____ $
Master Servicer: CUSIP: 76110F-
Residential Funding Company, LLC
Assumed Final Distribution Date:
___________ 25, ____
MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATE,
SERIES ____-___
evidencing a percentage interest in any distributions allocable
to the Class M- Certificates with respect to the Trust Fund
consisting primarily of a pool of [conventional one- to
four-family fixed interest rate first mortgage loans] 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, LLC 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, LLC or any of
their affiliates. None of the Company, the Master Servicer, GMAC Mortgage
Group, LLC 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 (obtained by dividing
the Certificate Principal Balance of this Certificate by the aggregate
Certificate Principal Balance of all Class M- Certificates, both as
specified above) in certain distributions with respect to a Trust Fund
consisting primarily of a pool of [conventional one- to four-family fixed
interest rate first mortgage loans] (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 __________________, 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 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"), 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 M- 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. The Initial
Certificate Principal Balance of this Certificate is set forth above. The
Certificate Principal Balance hereof will be reduced to the extent of the
distributions allocable to principal and any Realized Losses allocable hereto.
Any transferee of this Certificate will be deemed to have
represented by virtue of its purchase or holding of this Certificate (or
interest herein) that either (a) such transferee is not an investment
manager, a named fiduciary or a trustee of any plan, or any other person,
acting, directly or indirectly, on behalf of or purchasing any Certificate
with "plan assets" of any plan (a "plan investor"), (b) it has acquired and
is holding such Certificate in reliance on prohibited transaction exemption
("PTE") 94-29, as most recently amended, 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) (i)
the transferee is an insurance company, (ii) the source of funds to be used
by it to purchase the Certificate is an "insurance company general account"
(within the meaning of 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 (c), a "complying insurance company).
If this Certificate (or any interest herein) is acquired or held
by any person that does not satisfy the conditions described in the preceding
paragraph, 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 this Certificate.
The Trustee shall be under no liability to any person for making any payments
due on this Certificate to such preceding transferee.
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, 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 New 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: [_________________________],
as Trustee
By: _____________________________________
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class A- Certificates referred to in the
within-mentioned Agreement.
[___________________________],
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 C
FORM OF CLASS B CERTIFICATE
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE SENIOR
CERTIFICATES AND CLASS M CERTIFICATES [AND CLASS B-1] [CLASS B-2
CERTIFICATES] DESCRIBED IN THE AGREEMENT (AS DEFINED HEREIN).
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 AGREEMENT.
NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE
TRANSFEREE PROVIDES EITHER A CERTIFICATION PURSUANT TO SECTION 5.02(e) OF THE
AGREEMENT OR AN OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE THAT THE
PURCHASE OF THIS CERTIFICATE WILL NOT CONSTITUTE OR RESULT IN A 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 AND
WILL NOT SUBJECT THE MASTER SERVICER, THE COMPANY OR THE TRUSTEE TO ANY
OBLIGATION OR LIABILITY IN ADDITION TO THOSE UNDERTAKEN IN THE AGREEMENT.
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 CODE. THE FOLLOWING
INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S. FEDERAL
INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE. THE
ISSUE DATE OF THIS CERTIFICATE IS ___________ __, ____. ASSUMING THAT THE
MORTGAGE LOANS PREPAY AT 100% OF THE PREPAYMENT SPEED ASSUMPTION (AS
DESCRIBED IN THE PROSPECTUS SUPPLEMENT), THIS CERTIFICATE HAS BEEN ISSUED
WITH NO MORE THAN $[ ] OF OID PER $[1,000] OF INITIAL CERTIFICATE
PRINCIPAL BALANCE, THE YIELD TO MATURITY IS [ ]% AND THE AMOUNT OF OID
ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN $[ ] PER
$[1,000] OF INITIAL CERTIFICATE PRINCIPAL BALANCE, COMPUTED UNDER THE
APPROXIMATE METHOD. NO REPRESENTATION IS MADE THAT THE MORTGAGE LOANS WILL
PREPAY AT A RATE BASED ON THE PREPAYMENT SPEED ASSUMPTION OR AT ANY OTHER
RATE.
Certificate No. [ ]% Pass-Through Rate
Class B- Subordinate Aggregate Certificate
Principal Balance
Date of Pooling and Servicing of the Class B-
Agreement and Cut-off Date: Certificates as of
___________ 1, ____ the Cut-off Date:
$
First Distribution Date:
_________ 25, ____ Initial Certificate Principal
Balance of this Certificate:
Master Servicer: $
Residential Funding Company, LLC
Assumed Final Distribution Date:
___________ 25, ____
MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATE,
SERIES ____-___
evidencing a percentage interest in any distributions allocable
to the Class B- Certificates with respect to the Trust Fund
consisting primarily of a pool of [conventional one- to
four-family fixed interest rate first mortgage loans] 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, LLC 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, LLC or any of
their affiliates. None of the Company, the Master Servicer, GMAC Mortgage
Group, LLC 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 Residential Accredit Loans, Inc. is the
registered owner of the Percentage Interest evidenced by this Certificate
(obtained by dividing the Certificate Principal Balance of this Certificate
by the aggregate Certificate Principal Balance of all Class B-
Certificates, both as specified above) in certain distributions with respect
to a Trust Fund consisting primarily of a pool of [conventional one- to
four-family fixed interest rate first mortgage loans] (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 __________________, 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 is registered 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 next 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 B 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. The Initial
Certificate Principal Balance of this Certificate is set forth above. The
Certificate Principal Balance hereof will be reduced to the extent of the
distributions allocable to principal and any Realized Losses allocable hereto.
No transfer of this Class B 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 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 addressed to the Trustee, the Company and
the Master Servicer, acceptable to and in form and substance satisfactory to
the Trustee 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 B 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, 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 New 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: [_________________________],
as Trustee
By: _____________________________________
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class A- Certificates referred to in the
within-mentioned Agreement.
[___________________________],
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 C-I
FORM OF CLASS P CERTIFICATE
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 AGREEMENT).
NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE
TRANSFEREE PROVIDES EITHER A CERTIFICATION PURSUANT TO SECTION 5.02(e) OF THE
AGREEMENT OR AN OPINION OF COUNSEL SATISFACTORY TO THE THE TRUSTEE THAT THE
PURCHASE OF THIS CERTIFICATE WILL NOT CONSTITUTE OR RESULT IN A 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 AND
WILL NOT SUBJECT THE MASTER SERVICER, THE COMPANY OR THE TRUSTEE TO ANY
OBLIGATION OR LIABILITY IN ADDITION TO THOSE UNDERTAKEN IN THE AGREEMENT.
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:
__________ 1, ____ $0.00
First Distribution Date: Initial Certificate Principal Balance
__________ 25, ____ of this Certificate: $____
Master Servicer: Percentage Interest of this
Residential Funding Company, LLC Certificate:
100%
Assumed Final Distribution Date:
__________ 25, ____ CUSIP: __________
MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATE,
SERIES ____-___
evidencing a percentage interest in any distributions allocable
to the Class 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, LLC 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, LLC or any of
their affiliates. None of the Company, the Master Servicer, GMAC Mortgage
Group, LLC 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
____________________, 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 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.
No transfer of this Class 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 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 addressed to the Trustee, the Company and
the Master Servicer, acceptable to and in form and substance satisfactory to
the Trustee 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 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.
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, 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 New 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: [_________________________],
as Trustee
By: _____________________________________
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class A- Certificates referred to in the
within-mentioned Agreement.
[___________________________],
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 C-II
CLASS SB-[ ] CERTIFICATE
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE SENIOR
CERTIFICATES, THE CLASS M-1, CLASS M-2, CLASS M-3, [CLASS X-0, XXXXX X-0,
CLASS M-6, CLASS M-7, CLASS M-8, CLASS M-9 AND CLASS M-10] 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 INTERESTS IN THE SWAP AGREEMENT AND THE
SB-AM SWAP 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.SS.2510.3-101,
AS MODIFIED BY SECTION 3(42) OF ERISA ("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 TRUSTEE THAT THE
PURCHASE OF THIS CERTIFICATE IS PERMISSIBLE UNDER APPLICABLE LAW, WILL NOT
CONSTITUTE OR RESULT IN ANY PROHIBITED TRANSACTION UNDER TITLE I OF 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 TITLE I OF 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.
Class SB-[ ] Subordinate Certificate No. ___
Date of Pooling and Servicing Agreement Percentage Interest: _____%
and Cut-off Date:
___________ 1, ____
First Distribution Date: Aggregate Initial Notional Principal
___________ 25, ____ Balance of the Class SB-[ ]
Certificates:
$____________
Master Servicer: Initial Notional Balance
Residential Funding Company, LLC of this Class SB-2 Certificate:
$____________
Maturity Date: CUSIP: ____________
___________ 25, ____
MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATE,
Series _____-____
evidencing a percentage interest in any distributions
allocable to the Class SB-[ ] Certificates with
respect to the Trust Fund consisting primarily of a
pool of [one- to four-family residential, hybrid
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, LLC 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, LLC or any of their affiliates.
None of the Depositor, the Master Servicer, GMAC Mortgage Group, LLC 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 PRAMWAVE & CO. 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 [one- to four-family adjustable rate first lien mortgage loans] (the
"Mortgage Loans"), sold by Residential Accredit Loans, Inc. (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 _____________, 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 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. The Notional Amount of this Class
SB-[ ] Certificate as of any date of determination will be calculated as
described in the Agreement. This Class 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 SB-[
] Certificate will not accrue interest on its Certificate Principal Balance.
No transfer of this Class SB-[ ] 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 Depositor may require an opinion of counsel
acceptable to and in form and substance satisfactory to the Trustee and the
Depositor 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 the Agreement. The Holder hereof desiring to
effect such transfer shall, and does hereby agree to, indemnify the Trustee,
the Depositor, 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.
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.ss.2510.3-101,
as modified by Section 3(42) of ERISA ("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 Trustee that the
purchase of this Certificate is permissible under applicable law, will not
constitute or result in any prohibited transaction under Title I of 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 Title I of 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.
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, 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 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 neither the
Depositor, 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 New 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 (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 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.
[Signature Page Follows]
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: [_________________________],
as Trustee
By: _____________________________________
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class A- Certificates referred to in the
within-mentioned Agreement.
[___________________________],
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 D
FORM OF CLASS R CERTIFICATE
THIS CERTIFICATE MAY NOT BE HELD BY OR TRANSFERRED TO A NON-UNITED STATES
PERSON OR A DISQUALIFIED ORGANIZATION (AS DEFINED BELOW).
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986 (THE "CODE").
NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE
TRANSFEREE PROVIDES EITHER A CERTIFICATION PURSUANT TO SECTION 5.02(e) OF THE
AGREEMENT OR AN OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE THAT THE
PURCHASE OF THIS CERTIFICATE WILL NOT CONSTITUTE OR RESULT IN A 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 AND
WILL NOT SUBJECT THE MASTER SERVICER, THE COMPANY OR THE TRUSTEE TO ANY
OBLIGATION OR LIABILITY IN ADDITION TO THOSE UNDERTAKEN IN THE AGREEMENT.
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE
ONLY IF THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE MASTER
SERVICER AND THE TRUSTEE THAT (1) SUCH TRANSFEREE IS NOT (A) THE UNITED
STATES, ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY POSSESSION OF THE
UNITED STATES, OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF THE FOREGOING
(OTHER THAN AN INSTRUMENTALITY WHICH IS A CORPORATION IF ALL OF ITS
ACTIVITIES ARE SUBJECT TO TAX AND EXCEPT FOR XXXXXXX MAC, A MAJORITY OF ITS
BOARD OF DIRECTORS IS NOT SELECTED BY SUCH GOVERNMENTAL UNIT), (B) A FOREIGN
GOVERNMENT, ANY INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY
OF EITHER OF THE FOREGOING, (C) ANY ORGANIZATION (OTHER THAN CERTAIN FARMERS'
COOPERATIVES DESCRIBED IN SECTION 521 OF THE CODE) WHICH IS EXEMPT FROM THE
TAX IMPOSED BY CHAPTER 1 OF THE CODE UNLESS SUCH ORGANIZATION IS SUBJECT TO
THE TAX IMPOSED BY SECTION 511 OF THE CODE (INCLUDING THE TAX IMPOSED BY
SECTION 511 OF THE CODE ON UNRELATED BUSINESS TAXABLE INCOME), (D) RURAL
ELECTRIC AND TELEPHONE COOPERATIVES DESCRIBED IN SECTION 1381(a)(2)(C) OF THE
CODE, (E) AN ELECTING LARGE PARTNERSHIP UNDER SECTION 775(a) OF THE CODE (ANY
SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (A), (B), (C), (D) OR (E)
BEING HEREIN REFERRED TO AS A "DISQUALIFIED ORGANIZATION"), OR (F) AN AGENT
OF A DISQUALIFIED ORGANIZATION, (2) NO PURPOSE OF SUCH TRANSFER IS TO IMPEDE
THE ASSESSMENT OR COLLECTION OF TAX AND (3) SUCH TRANSFEREE SATISFIES CERTAIN
ADDITIONAL CONDITIONS RELATING TO THE FINANCIAL CONDITION OF THE PROPOSED
TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE REGISTER OR
ANY TRANSFER, SALE OR OTHER DISPOSITION OF THIS CERTIFICATE TO A DISQUALIFIED
ORGANIZATION OR AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH REGISTRATION
SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR EFFECT WHATSOEVER AND SUCH PERSON
SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER FOR ANY PURPOSE HEREUNDER,
INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS
CERTIFICATE. EACH HOLDER OF THIS CERTIFICATE BY ACCEPTANCE OF THIS
CERTIFICATE SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF THIS
PARAGRAPH.
Certificate No. [ ]% Pass-Through Rate
Class R Senior Aggregate Initial Certificate
Principal Balance of the
Date of Pooling and Servicing Class R Certificates:
Agreement and Cut-off Date: $100.00
___________ 1, ____
Initial Certificate Principal
First Distribution Date: Balance of this Certificate:
_________ 25, ____ $
Master Servicer: Percentage Interest:
Residential Funding Company, LLC %
Assumed Final Distribution Date: CUSIP 76110F-
___________ 25, ____
MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATE,
SERIES ____-___
evidencing a percentage interest in any distributions allocable
to the Class R Certificates with respect to the Trust Fund
consisting primarily of a pool of [conventional one- to
four-family fixed interest rate first mortgage loans] 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, LLC 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, LLC or any of
their affiliates. None of the Company, the Master Servicer, GMAC Mortgage
Group, LLC 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 (obtained by dividing
the Initial Certificate Principal Balance of this Certificate by the
aggregate Initial Certificate Principal Balance of all Class R Certificates,
both as specified above) in certain distributions with respect to the Trust
Fund consisting primarily of a pool of [conventional one- to four-family
fixed interest rate first mortgage loans] (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 __________________, 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 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"), 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 R Certificates on such Distribution Date.
Each Holder of this Certificate will be deemed to have agreed to
be bound by the restrictions set forth in the Agreement to the effect that
(i) each person holding or acquiring any Ownership Interest in this
Certificate must be a United States Person and a Permitted Transferee, (ii)
the transfer of any Ownership Interest in this Certificate will be
conditioned upon the delivery to the Trustee of, among other things, an
affidavit to the effect that it is a United States Person and Permitted
Transferee, (iii) any attempted or purported transfer of any Ownership
Interest in this Certificate in violation of such restrictions will be
absolutely null and void and will vest no rights in the purported transferee,
and (iv) if any person other than a United States Person and a Permitted
Transferee acquires any Ownership Interest in this Certificate in violation
of such restrictions, then the Company will have the right, in its sole
discretion and without notice to the Holder of this Certificate, to sell this
Certificate to a purchaser selected by the Company, which purchaser may be
the Company, or any affiliate of the Company, on such terms and conditions as
the Company may choose.
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. The Initial
Certificate Principal Balance of this Certificate is set forth above. The
Certificate Principal Balance hereof will be reduced to the extent of
distributions allocable to principal and any Realized Losses allocable
hereto. Notwithstanding the reduction of the Certificate Principal Balance
hereof to zero, this Certificate will remain outstanding under the Agreement
and the Holder hereof may have additional obligations with respect to this
Certificate, including tax liabilities, and may be entitled to certain
additional distributions hereon, in accordance with the terms and provisions
of the Agreement.
No transfer of this Class R Certificate will be made unless the
Trustee has received either (i) an opinion of counsel addressed to the
Trustee, the Company and the Master Servicer, acceptable to and in form and
substance satisfactory to the Trustee 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
R 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 the Agreement, 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.
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, 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 New 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.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall
for all purpose have the same effect as if set forth at this place.
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: [_________________________],
as Trustee
By: _____________________________________
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class A- Certificates referred to in the
within-mentioned Agreement.
[___________________________],
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 E
FORM OF SELLER/SERVICER CONTRACT
This Seller/Servicer Contract (as may be amended, supplemented or
otherwise modified from time to time, this "Contract") is made this
______________ day of _____________________, 20 _____________ , by and between
Residential Funding Company, LLC, its successors and assigns ("Residential
Funding") and _________________________________________________________ (the
"Seller/Servicer," and, together with Residential Funding, the "parties" and
each, individually, a "party").
WHEREAS, the Seller/Servicer desires to sell Loans to, and/or service
Loans for, Residential Funding, and Residential Funding desires to purchase
Loans from the Seller/Servicer and/or have the Seller/Servicer service
various of its Loans, pursuant to the terms of this Contract and the
Residential Funding Seller and Servicer Guides incorporated herein by
reference, as amended, supplemented or otherwise modified, from time to time
(together, the "Guides").
NOW, THEREFORE, in consideration of the premises, and the terms,
conditions and agreements set forth below, the parties agree as follows:
1. INCORPORATION OF GUIDES BY REFERENCE.
The Seller/Servicer acknowledges that it has received and read the
Guides. All provisions of the Guides are incorporated by reference into and
made a part of this Contract, and shall be binding upon the parties;
provided, however, that the Seller/Servicer shall be entitled to sell Loans
to and/or service Loans for Residential Funding only if and for so long as it
shall have been authorized to do so by Residential Funding in writing.
Specific reference in this Contract to particular provisions of the Guides
and not to other provisions does not mean that those provisions of the Guides
not specifically cited in this Contract are not applicable. All terms used
herein shall have the same meanings as such terms have in the Guides, unless
the context clearly requires otherwise.
2. AMENDMENTS.
This Contract may not be amended or modified orally, and no provision
of this Contract may be waived or amended except in writing signed by the
party against whom enforcement is sought. Such a written waiver or amendment
must expressly reference this Contract. However, by their terms, the Guides
may be amended or supplemented by Residential Funding from time to time. Any
such amendment(s) to the Guides shall be binding upon the parties hereto.
3. REPRESENTATIONS AND WARRANTIES.
a. Reciprocal Representations and Warranties.
The Seller/Servicer and Residential Funding each represents and
warrants to the other that as of the date of this Contract:
(1) Each party is duly organized, validly existing, and in good standing
under the laws of its jurisdiction of organization, is
qualified, if necessary, to do business and in good
standing in each jurisdiction in which it is required to be
so qualified, and has the requisite power and authority to
enter into this Contract and all other agreements which are
contemplated by this Contract and to carry out its
obligations hereunder and under the Guides and under such
other agreements.
(2) This Contract has been duly authorized, executed and delivered by each
party and constitutes a valid and legally binding agreement
of each party enforceable in accordance with its terms.
(3) There is no action, proceeding or investigation pending or threatened,
and no basis therefor is known to either party, that could
affect the validity or prospective validity of this
Contract.
(4) Insofar as its capacity to carry out any obligation under this Contract
is concerned, neither party is in violation of any charter,
articles of incorporation, bylaws, certificates of
formation, limited liability company agreement, mortgage,
indenture, indebtedness, agreement, instrument, judgment,
decree, order, statute, rule or regulation and none of the
foregoing adversely affects its capacity to fulfill any of
its obligations under this Contract. Its execution of, and
performance pursuant to, this Contract will not result in a
violation of any of the foregoing.
b. Seller/Servicer's Representations, Warranties and Covenants.
In addition to the representations, warranties and covenants made
by the Seller/Servicer pursuant to subparagraph (a) of this
paragraph 3, the Seller/Servicer makes the representations,
warranties and covenants set forth in the Guides and, upon
request, agrees to deliver to Residential Funding the certified
Resolution of Board of Directors which authorizes the execution
and delivery of this Contract.
4. REMEDIES OF RESIDENTIAL FUNDING.
If an Event of Seller Default or an Event of Servicer Default shall
occur, Residential Funding may, at its option, exercise one or more of those
remedies set forth in the Guides.
5. SELLER/SERVICER'S STATUS AS INDEPENDENT CONTRACTOR.
At no time shall the Seller/Servicer represent that it is acting as an
agent of Residential Funding. The Seller/Servicer shall, at all times, act
as an independent contractor.
6. PRIOR AGREEMENTS SUPERSEDED.
This Contract restates, amends and supersedes any and all prior Seller
Contracts or Servicer Contracts between the parties except that any
subservicing agreement executed by the Seller/Servicer in connection with any
loan-security exchange transaction shall not be affected.
7. ASSIGNMENT.
This Contract may not be assigned or transferred, in whole or in part,
by the Seller/Servicer without the prior written consent of Residential
Funding. Residential Funding may sell, assign, convey, hypothecate, pledge
or in any other way transfer, in whole or in part, without restriction, its
rights under this Contract and the Guides with respect to any Commitment or
Loan.
8. NOTICES.
All notices, requests, demands or other communications that are to be
given under this Contract shall be in writing, addressed to the appropriate
parties and sent by telefacsimile or by overnight courier or by United States
mail, postage prepaid, to the addresses and telefacsimile numbers specified
below. However, another name, address and/or telefacsimile number may be
substituted by the Seller/Servicer pursuant to the requirements of this
paragraph 8, or Residential Funding pursuant to an amendment to the Guides.
If to Residential Funding, notices must be sent to the appropriate address or
telefacsimile number specified in the Guides.
If to the Seller/Servicer, notice must be sent to:
Attention:
Telefacsimile Number: ( )
-
9. JURISDICTION AND VENUE.
Each of the parties irrevocably submits to the jurisdiction of any
state or federal court located in Hennepin County, Minnesota, over any
action, suit or proceeding to enforce or defend any right under this Contract
or otherwise arising from any loan sale or servicing relationship existing in
connection with this Contract, and each of the parties irrevocably agrees
that all claims in respect of any such action or proceeding may be heard or
determined in such state or federal court. Each of the parties irrevocably
waives the defense of an inconvenient forum to the maintenance of any such
action or proceeding and any other substantive or procedural rights or
remedies it may have with respect to the maintenance of any such action or
proceeding in any such forum. Each of the parties agrees that a final
judgment in any such action or proceeding shall be conclusive and may be
enforced in any other jurisdiction by suit on the judgment or in any other
manner provided by law. Each of the parties further agrees not to institute
any legal actions or proceedings against the other party or any director,
officer, employee, attorney, agent or property of the other party, arising
out of or relating to this Contract in any court other than as hereinabove
specified in this paragraph 9.
10. MISCELLANEOUS.
This Contract, including all documents incorporated by reference
herein, constitutes the entire understanding between the parties hereto and
supersedes all other agreements, covenants, representations, warranties,
understandings and communications between the parties, whether written or
oral, with respect to the transactions contemplated by this Contract. All
paragraph headings contained herein are for convenience only and shall not be
construed as part of this Contract. Any provision of this Contract that is
prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining portions hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction, and, to this end, the provisions hereof are severable. This
Contract shall be governed by, and construed and enforced in accordance with,
applicable federal laws and the laws of the State of Minnesota.
IN WITNESS WHEREOF, the duly authorized officers of the Seller/Servicer
and Residential Funding have executed this Seller/Servicer Contract as of the
date first above written.
ATTEST: SELLER/SERVICER
[Corporate Seal]
(Name of Seller/Servicer)
By: By:
(Signature) (Signature)
By: By:
(Typed Name) (Typed Name)
Title: Title:
=================================================================================
ATTEST: RESIDENTIAL FUNDING COMPANY, LLC
[Corporate Seal]
By: By:
(Signature) (Signature)
By: By:
(Typed Name) (Typed Name)
Title: Title:
EXHIBIT F
FORMS OF REQUEST FOR RELEASE
DATE:
TO:
RE: REQUEST FOR RELEASE OF DOCUMENTS
In connection with the administration of the pool of Mortgage Loans held by
you for the referenced pool, we request the release of the Mortgage Loan File
described below.
Pooling and Servicing Agreement Dated:
Series#:
Account#:
Pool#:
Loan#:
MIN#:
Borrower Name(s):
Reason for Document Request: (circle one)
Mortgage Loan Prepaid in Full Mortgage Loan Repurchased
"We hereby certify that all amounts received or to be received in connection
with such payments which are required to be deposited have been or will be so
deposited as provided in the Pooling and Servicing Agreement."
Residential Funding Company, LLC
Authorized Signature
******************************************************************************
TO CUSTODIAN/TRUSTEE: Please acknowledge this request, and check off
documents being enclosed with a copy of this form. You should retain this
form for your files in accordance with the terms of the Pooling and Servicing
Agreement.
Enclosed Documents: [ ] Promissory Note
[ ] Primary Insurance Policy
[ ] Mortgage or Deed of Trust
[ ] Assignment(s) of Mortgage or Deed of Trust
[ ] Title Insurance Policy
[ ] Other:
Name:
Title:
Date:
EXHIBIT G-1
FORM OF TRANSFER AFFIDAVIT AND AGREEMENT
STATE OF )
) ss.:
COUNTY OF )
[NAME OF OFFICER], being first duly sworn, deposes and says:
1. That he is [Title of Officer] of [Name of Owner] (record or
beneficial owner of the Mortgage Asset-Backed Pass-Through Certificates,
Series ____-___, Class R (the "Owner")), a [savings institution]
[corporation] duly organized and existing under the laws of [the State of
] [the United States], on behalf of which
he makes this affidavit and agreement.
2. That the Owner (i) is not and will not be a "disqualified
organization" or an electing large partnership as of [date of transfer]
within the meaning of Sections 860E(e)(5) and 775, respectively, of the
Internal Revenue Code of 1986, as amended (the "Code") or an electing large
partnership under Section 775(a) of the Code, (ii) will endeavor to remain
other than a disqualified organization for so long as it retains its
ownership interest in the Class R Certificates, and (iii) is acquiring the
Class R Certificates for its own account or for the account of another Owner
from which it has received an affidavit and agreement in substantially the
same form as this affidavit and agreement. (For this purpose, a "disqualified
organization" means an electing large partnership under Section 775 of the
Code, the United States, any state or political subdivision thereof, any
agency or instrumentality of any of the foregoing (other than an
instrumentality all of the activities of which are subject to tax and, except
for the Federal Home Loan Mortgage Corporation, a majority of whose board of
directors is not selected by any such governmental entity) or any foreign
government, international organization or any agency or instrumentality of
such foreign government or organization, any rural electric or telephone
cooperative, or any organization (other than certain farmers' cooperatives)
that is generally exempt from federal income tax unless such organization is
subject to the tax on unrelated business taxable income).
3. That the Owner is aware (i) of the tax that would be imposed on
transfers of Class R Certificates to disqualified organizations or electing
large partnerships, under the Code, that applies to all transfers of Class R
Certificates after March 31, 1988; (ii) that such tax would be on the
transferor (or, with respect to transfers to electing large partnerships, on
each such partnership), or, if such transfer is through an agent (which
person includes a broker, nominee or middleman) for a disqualified
organization, on the agent; (iii) that the person (other than with respect to
transfers to electing large partnerships) otherwise liable for the tax shall
be relieved of liability for the tax if the transferee furnishes to such
person an affidavit that the transferee is not a disqualified organization
and, at the time of transfer, such person does not have actual knowledge that
the affidavit is false; and (iv) that the Class R Certificates may be
"noneconomic residual interests" within the meaning of Treasury regulations
promulgated pursuant to the Code and that the transferor of a noneconomic
residual interest will remain liable for any taxes due with respect to the
income on such residual interest, unless no significant purpose of the
transfer was to impede the assessment or collection of tax.
4. That the Owner is aware of the tax imposed on a "pass-through
entity" holding Class R Certificates if either the pass-through entity is an
electing large partnership under Section 775 of the Code or if at any time
during the taxable year of the pass-through entity a disqualified
organization is the record holder of an interest in such entity. (For this
purpose, a "pass through entity" includes a regulated investment company, a
real estate investment trust or common trust fund, a partnership, trust or
estate, and certain cooperatives.)
5. The Owner is either (i) a citizen or resident of the United
States, (ii) a corporation, partnership or other entity treated as a
corporation or a partnership for U.S. federal income tax purposes and created
or organized in or under the laws of the United States, any state thereof or
the District of Columbia (other than a partnership that is not treated as a
United States person under any applicable Treasury regulations), (iii) an
estate that is described in Section 7701(a)(30)(D) of the Code, or (iv) a
trust that is described in Section 7701(a)(30)(E) of the Code.
6. The Owner hereby agrees that it will not cause income from the
Class R Certificates to be attributable to a foreign permanent establishment
or fixed base (within the meaning of an applicable income tax treaty) of the
Owner or another United States taxpayer.
7. That the Owner is aware that the Trustee will not register the
transfer of any Class R Certificates unless the transferee, or the
transferee's agent, delivers to it an affidavit and agreement, among other
things, in substantially the same form as this affidavit and agreement. The
Owner expressly agrees that it will not consummate any such transfer if it
knows or believes that any of the representations contained in such affidavit
and agreement are false.
8. That the Owner has reviewed the restrictions set forth on the
face of the Class R Certificates and the provisions of Section 5.02(f) of the
Pooling and Servicing Agreement under which the Class R Certificates were
issued (in particular, clause (iii)(A) and (iii)(B) of Section 5.02(f) which
authorize the Trustee to deliver payments to a person other than the Owner
and negotiate a mandatory sale by the Trustee in the event the Owner holds
such Certificates in violation of Section 5.02(f)). The Owner expressly
agrees to be bound by and to comply with such restrictions and provisions.
9. That the Owner consents to any additional restrictions or
arrangements that shall be deemed necessary upon advice of counsel to
constitute a reasonable arrangement to ensure that the Class R Certificates
will only be owned, directly or indirectly, by an Owner that is not a
disqualified organization.
10. The Owner's Taxpayer Identification Number is__________________.
11. This affidavit and agreement relates only to the Class R
Certificates held by the Owner and not to any other holder of the Class R
Certificates. The Owner understands that the liabilities described herein
relate only to the Class R Certificates.
12. That no purpose of the Owner relating to the transfer of any of
the Class R Certificates by the Owner is or will be to impede the assessment
or collection of any tax; in making this representation, the Owner warrants
that the Owner is familiar with (i) Treasury Regulation Section 1.860E-1(c)
and recent amendments thereto, effective as of July 19, 2002, and (ii) the
preamble describing the adoption of the amendments to such regulation, which
is attached hereto as Exhibit 1.
13. That the Owner has no present knowledge or expectation that it
will be unable to pay any United States taxes owed by it so long as any of
the Certificates remain outstanding. In this regard, the Owner hereby
represents to and for the benefit of the person from whom it acquired the
Class R Certificate that the Owner intends to pay taxes associated with
holding such Class R Certificate as they become due, fully understanding that
it may incur tax liabilities in excess of any cash flows generated by the
Class R Certificate.
14. That the Owner has no present knowledge or expectation that it
will become insolvent or subject to a bankruptcy proceeding for so long as
any of the Class R Certificates remain outstanding.
15. The Purchaser is not an employee benefit plan or other plan
subject to the prohibited transaction provisions of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), or Section 4975 of the
Code, or an investment manager, named fiduciary or a trustee of any such
plan, or any other Person acting, directly or indirectly, on behalf of or
purchasing any Certificate with "plan assets" of any such plan.
IN WITNESS WHEREOF, the Owner has caused this instrument to be
executed on its behalf, pursuant to the authority of its Board of Directors,
by its [Title of Officer] and its corporate seal to be hereunto attached,
attested by its [Assistant] Secretary, this ___________ day of
__________, 200 ___.
[NAME OF OWNER]
By: ___________________________
[Name of Officer]
[Title of Officer]
[Corporate Seal]
ATTEST:
[Assistant] Secretary
Personally appeared before me the above-named [Name of Officer],
known or proved to me to be the same person who executed the foregoing
instrument and to be the [Title of Officer] of the Owner, and acknowledged to
me that he executed the same as his free act and deed and the free act and
deed of the Owner.
Subscribed and sworn before me this __________ day of
__________, 200 __.
NOTARY PUBLIC
COUNTY OF ___________________
STATE OF ___________________
My Commission expires the _________ day of ________, 20__ .
EXHIBIT 1
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Parts 1 and 602
[TD 9004]
RIN 1545-AW98
Real Estate Mortgage Investment Conduits
AGENCY: Internal Revenue Service (IRS), Treasury.
ACTION: Final regulations.
-----------------------------------------------------------------------
SUMMARY: This document contains final regulations relating to safe
harbor transfers of noneconomic residual interests in real estate
mortgage investment conduits (REMICs). The final regulations provide
additional limitations on the circumstances under which transferors may
claim safe harbor treatment.
DATES: Effective Date: These regulations are effective July 19, 2002.
Applicability Date: For dates of applicability, see Sec. 1.860E-
(1)(c)(10).
FOR FURTHER INFORMATION CONTACT: Xxxxxxxx Xxxxxxxxxx at (000) 000-0000
(not a toll-free number).
SUPPLEMENTARY INFORMATION:
Paperwork Reduction Act
The collection of information in this final rule has been reviewed
and, pending receipt and evaluation of public comments, approved by the
Office of Management and Budget (OMB) under 44 U.S.C. 3507 and assigned
control number 1545-1675.
The collection of information in this regulation is in Sec. 1.860E-
1(c)(5)(ii). This information is required to enable the IRS to verify
that a taxpayer is complying with the conditions of this regulation.
The collection of information is mandatory and is required. Otherwise,
the taxpayer will not receive the benefit of safe harbor treatment as
provided in the regulation. The likely respondents are businesses and
other for-profit institutions.
Comments on the collection of information should be sent to the
Office of Management and Budget, Attn: Desk Officer for the Department
of the Treasury, Office of Information and Regulatory Affairs,
Xxxxxxxxxx, XX, 00000, with copies to the Internal Revenue Service,
Attn: IRS Reports Clearance Officer, W:CAR:MP:FP:S, Xxxxxxxxxx, XX
00000. Comments on the collection of information should be received by
September 17, 2002. Comments are specifically requested concerning:
Whether the collection of information is necessary for the proper
performance of the functions of the Internal Revenue Service, including
whether the information will have practical utility;
The accuracy of the estimated burden associated with the collection
of information (see below);
How the quality, utility, and clarity of the information to be
collected may be enhanced;
How the burden of complying with the collection of information may
be minimized, including through the application of automated collection
techniques or other forms of information technology; and
Estimates of capital or start-up costs and costs of operation,
maintenance, and purchase of service to provide information.
An agency may not conduct or sponsor, and a person is not required
to respond to, a collection of information unless it displays a valid
control number assigned by the Office of Management and Budget.
The estimated total annual reporting burden is 470 hours, based on
an estimated number of respondents of 470 and an estimated average
annual burden hours per respondent of one hour.
Books or records relating to a collection of information must be
retained as long as their contents may become material in the
administration of any internal revenue law. Generally, tax returns and
tax return information are confidential, as required by 26 U.S.C. 6103.
Background
This document contains final regulations regarding the proposed
amendments to 26 CFR part 1 under section 860E of the Internal Revenue
Code (Code). The regulations provide the circumstances under which a
transferor of a noneconomic REMIC residual interest meeting the
investigation and representation requirements may avail itself of the
safe harbor by satisfying either the formula test or the asset test.
Final regulations governing REMICs, issued in 1992, contain rules
governing the transfer of noneconomic REMIC residual interests. In
general, a transfer of a noneconomic residual interest is disregarded
for all tax purposes if a significant purpose of the transfer is to
[[Page 47452]]
enable the transferor to impede the assessment or collection of tax. A
purpose to impede the assessment or collection of tax (a wrongful
purpose) exists if the transferor, at the time of the transfer, either
knew or should have known that the transferee would be unwilling or
unable to pay taxes due on its share of the REMIC's taxable income.
Under a safe harbor, the transferor of a REMIC noneconomic residual
interest is presumed not to have a wrongful purpose if two requirements
are satisfied: (1) the transferor conducts a reasonable investigation
of the transferee's financial condition (the investigation
requirement); and (2) the transferor secures a representation from the
transferee to the effect that the transferee understands the tax
obligations associated with holding a residual interest and intends to
pay those taxes (the representation requirement).
The IRS and Treasury have been concerned that some transferors of
noneconomic residual interests claim they satisfy the safe harbor even
in situations where the economics of the transfer clearly indicate the
transferee is unwilling or unable to pay the tax associated with
holding the interest. For this reason, on February 7, 2000, the IRS
published in the Federal Register (65 FR 5807) a notice of proposed
rulemaking (REG-100276-97; REG-122450-98) designed to clarify the safe
harbor by adding the "formula test," an economic test. The proposed
regulation provides that the safe harbor is unavailable unless the
present value of the anticipated tax liabilities associated with
holding the residual interest does not exceed the sum of: (1) The
present value of any consideration given to the transferee to acquire
the interest; (2) the present value of the expected future
distributions on the interest; and (3) the present value of the
anticipated tax savings associated with holding the interest as the
REMIC generates losses.
The notice of proposed rulemaking also contained rules for FASITs.
Section 1.860H-6(g) of the proposed regulations provides requirements
for transfers of FASIT ownership interests and adopts a safe harbor by
reference to the safe harbor provisions of the REMIC regulations.
In January 2001, the IRS published Rev. Proc. 2001-12 (2001-3
I.R.B. 335) to set forth an alternative safe harbor that taxpayers
could use while the IRS and the Treasury considered comments on the
proposed regulations. Under the alternative safe harbor, if a
transferor meets the investigation requirement and the representation
requirement but the transfer fails to meet the formula test, the
transferor may invoke the safe harbor if the transferee meets a two-
prong test (the asset test). A transferee generally meets the first
prong of this test if, at the time of the transfer, and in each of the
two years preceding the year of transfer, the transferee's gross assets
exceed $100 million and its net assets exceed $10 million. A transferee
generally meets the second prong of this test if it is a domestic,
taxable corporation and agrees in writing not to transfer the interest
to any person other than another domestic, taxable corporation that
also satisfies the requirements of the asset test. A transferor cannot
rely on the asset test if the transferor knows, or has reason to know,
that the transferee will not comply with its written agreement to limit
the restrictions on subsequent transfers of the residual interest.
Rev. Proc. 2001-12 provides that the asset test fails to be
satisfied in the case of a transfer or assignment of a noneconomic
residual interest to a foreign branch of an otherwise eligible
transferee. If such a transfer or assignment were permitted, a
corporate taxpayer might seek to claim that the provisions of an
applicable income tax treaty would resource excess inclusion income as
foreign source income, and that, as a consequence, any U.S. tax
liability attributable to the excess inclusion income could be offset
by foreign tax credits. Such a claim would impede the assessment or
collection of U.S. tax on excess inclusion income, contrary to the
congressional purpose of assuring that such income will be taxable in
all events. See, e.g., sections 860E(a)(1), (b), (e) and 860G(b) of the
Code.
The Treasury and the IRS have learned that certain taxpayers
transferring noneconomic residual interests to foreign branches have
attempted to rely on the formula test to obtain safe harbor treatment
in an effort to impede the assessment or collection of U.S. tax on
excess inclusion income. Accordingly, the final regulations provide
that if a noneconomic residual interest is transferred to a foreign
permanent establishment or fixed base of a U.S. taxpayer, the transfer
is not eligible for safe harbor treatment under either the asset test
or the formula test. The final regulations also require a transferee to
represent that it will not cause income from the noneconomic residual
interest to be attributable to a foreign permanent establishment or
fixed base.
Section 1.860E-1(c)(8) provides computational rules that a taxpayer
may use to qualify for safe harbor status under the formula test.
Section 1.860E-1(c)(8)(i) provides that the transferee is presumed to
pay tax at a rate equal to the highest rate of tax specified in section
11(b). Some commentators were concerned that this presumed rate of
taxation was too high because it does not take into consideration
taxpayers subject to the alternative minimum tax rate. In light of the
comments received, this provision has been amended in the final
regulations to allow certain transferees that compute their taxable
income using the alternative minimum tax rate to use the alternative
minimum tax rate applicable to corporations.
Additionally, Sec. 1.860E-1(c)(8)(iii) provides that the present
values in the formula test are to be computed using a discount rate
equal to the applicable Federal short-term rate prescribed by section
1274(d). This is a change from the proposed regulation and Rev. Proc.
2001-12. In those publications the provision stated that "present
values are computed using a discount rate equal to the applicable
Federal rate prescribed in section 1274(d) compounded semiannually"
and that "[a] lower discount rate may be used if the transferee can
demonstrate that it regularly borrows, in the course of its trade or
business, substantial funds at such lower rate from an unrelated third
party." The IRS and the Treasury Department have learned that, based
on this provision, certain taxpayers have been attempting to use
unrealistically low or zero interest rates to satisfy the formula test,
frustrating the intent of the test. Furthermore, the Treasury
Department and the IRS believe that a rule allowing for a rate other
than a rate based on an objective index would add unnecessary
complexity to the safe harbor. As a result, the rule in the proposed
regulations that permits a transferee to use a lower discount rate, if
the transferee can demonstrate that it regularly borrows substantial
funds at such lower rate, is not included in the final regulations; and
the Federal short-term rate has been substituted for the applicable
Federal rate. To simplify taxpayers' computations, the final
regulations allow use of any of the published short-term rates,
provided that the present values are computed with a corresponding
period of compounding. With the exception of the provisions relating to
transfers to foreign branches, these changes generally have the
proposed applicability date of February 4, 2000, but taxpayers may
choose to apply the interest rate formula set forth in the proposed
regulation and Rev. Proc. 2001-12 for transfers occurring before August
19, 2002.
It is anticipated that when final regulations are adopted with
respect to
[[Page 47453]]
FASITs, Sec. 1.860H-6(g) of the proposed regulations will be adopted in
substantially its present form, with the result that the final
regulations contained in this document will also govern transfers of
FASIT ownership interests with substantially the same applicability
date as is contained in this document.
Effect on Other Documents
Rev. Proc. 2001-12 (2001-3 I.R.B. 335) is obsolete for transfers of
noneconomic residual interests in REMICs occurring on or after August
19, 2002.
Special Analyses
It is hereby certified that these regulations will not have a
significant economic impact on a substantial number of small entities.
This certification is based on the fact that it is unlikely that a
substantial number of small entities will hold REMIC residual
interests. Therefore, a Regulatory Flexibility Analysis under the
Regulatory Flexibility Act (5 U.S.C. chapter 6) is not required. It has
been determined that this Treasury decision is not a significant
regulatory action as defined in Executive Order 12866. Therefore, a
regulatory assessment is not required. It also has been determined that
sections 553(b) and 553(d) of the Administrative Procedure Act (5
U.S.C. chapter 5) do not apply to these regulations.
Drafting Information
The principal author of these regulations is Xxxxxxxx Xxxxxxxxxx.
However, other personnel from the IRS and Treasury Department
participated in their development.
List of Subjects
26 CFR Part 1
Income taxes, Reporting and record keeping requirements.
26 CFR Part 602
Reporting and record keeping requirements.
Adoption of Amendments to the Regulations
Accordingly, 26 CFR parts 1 and 602 are amended as follows:
PART 1--INCOME TAXES
Paragraph 1. The authority citation for part 1 continues to read in
part as follows:
Authority: 26 U.S.C. 7805 * * *
EXHIBIT G-2
FORM OF TRANSFEROR CERTIFICATE
____ , 20__
Residential Accredit Loans, Inc.
0000 Xxxxxxxxxx Xxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxx 00000
__________________
__________________
__________________
Attention: Residential Funding Company, LLC Series ____-___
Re: Mortgage Asset-Backed Pass-Through
Certificates,
Series ____-___, Class R
Ladies and Gentlemen:
This letter is delivered to you in connection with the transfer
by (the
"Seller") to
(the "Purchaser") of $ ______________________________ Initial Certificate
Principal Balance of Mortgage Asset-Backed Pass-Through Certificates, Series
____-___, Class R (the "Certificates"), pursuant to Section 5.02 of the
Pooling and Servicing Agreement (the "Pooling and Servicing Agreement"),
dated as of ___________ 1, ____ among Residential Accredit Loans, Inc., as
seller (the "Company"), Residential Funding Company, LLC, as master servicer
(the "Master Servicer"), and __________________, 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 Seller hereby certifies,
represents and warrants to, and covenants with, the Company and the Trustee
that:
1. No purpose of the Seller relating to the transfer of the
Certificate by the Seller to the Purchaser is or will be to impede the
assessment or collection of any tax.
2. The Seller understands that the Purchaser has delivered to the
Trustee and the Master Servicer a transfer affidavit and agreement in the
form attached to the Pooling and Servicing Agreement as Exhibit G-1. The
Seller does not know or believe that any representation contained therein is
false.
3. The Seller has at the time of the transfer conducted a reasonable
investigation of the financial condition of the Purchaser as contemplated by
Treasury Regulations Section 1.860E-1(c)(4)(i) and, as a result of that
investigation, the Seller has determined that the Purchaser has historically
paid its debts as they become due and has found no significant evidence to
indicate that the Purchaser will not continue to pay its debts as they become
due in the future. The Seller understands that the transfer of a Class R
Certificate may not be respected for United States income tax purposes (and
the Seller may continue to be liable for United States income taxes
associated therewith) unless the Seller has conducted such an investigation.
4. The Seller has no actual knowledge that the proposed Transferee
is not both a United States Person and a Permitted Transferee.
Very truly yours,
(Seller)
By: ______________________________
Name:
Title:
EXHIBIT H
FORM OF INVESTOR REPRESENTATION LETTER
____________ , 20 ___
Residential Accredit Loans, Inc.
0000 Xxxxxxxxxx Xxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxxxx, XX 00000
__________________
__________________
__________________
Residential Funding Company, LLC
0000 Xxxxxxxxxx Xxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxxxx, XX 00000
Attention: Residential Funding Company, LLC Series ____-___
RE: Mortgage Asset-Backed Pass-Through
Certificates,
Series ____-___, [Class B-]
Ladies and Gentlemen:
_______________ (the"Purchaser") intends to purchase from
_________(the "Seller")$______ Initial Certificate Principal Balance of Mortgage
Asset-Backed Pass-Through Certificates, Series ____-___, Class (the
"Certificates"), issued pursuant to the Pooling and Servicing Agreement (the
"Pooling and Servicing Agreement"), dated as of ___________ 1, ____ among
Residential Accredit Loans, Inc., as seller (the "Company"), Residential
Funding Company, LLC, as master servicer (the "Master Servicer"), and
__________________, 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 Company, the Trustee and the Master Servicer that:
1. The Purchaser understands that (a) the Certificates have not been
and will not be registered or qualified under the Securities Act
of 1933, as amended (the "Act") or any state securities law, (b)
the Company is not required to so register or qualify the
Certificates, (c) the Certificates may be resold only if
registered and qualified pursuant to the provisions of the Act or
any state securities law, or if an exemption from such
registration and qualification is available, (d) the Pooling and
Servicing Agreement contains restrictions regarding the transfer
of the Certificates and (e) the Certificates will bear a legend
to the foregoing effect.
2. The Purchaser is acquiring the Certificates for its own account
for investment only and not with a view to or for sale in
connection with any distribution thereof in any manner that would
violate the Act or any applicable state securities laws.
3. The Purchaser is (a) a substantial, sophisticated institutional
investor having such knowledge and experience in financial and
business matters, and, in particular, in such matters related to
securities similar to the Certificates, such that it is capable
of evaluating the merits and risks of investment in the
Certificates, (b) able to bear the economic risks of such an
investment and (c) an "accredited investor" within the meaning of
Rule 501(a) promulgated pursuant to the Act.
4. The Purchaser has been furnished with, and has had an opportunity
to review (a) [a copy of the Private Placement Memorandum, dated
, 20 , relating to the
Certificates (b)] a copy of the Pooling and Servicing Agreement
and [b] [c] such other information concerning the Certificates,
the Mortgage Loans and the Company as has been requested by the
Purchaser from the Company or the Seller and is relevant to the
Purchaser's decision to purchase the Certificates. The Purchaser
has had any questions arising from such review answered by the
Company or the Seller to the satisfaction of the Purchaser. [If
the Purchaser did not purchase the Certificates from the Seller
in connection with the initial distribution of the Certificates
and was provided with a copy of the Private Placement Memorandum
(the "Memorandum") relating to the original sale (the "Original
Sale") of the Certificates by the Company, the Purchaser
acknowledges that such Memorandum was provided to it by the
Seller, that the Memorandum was prepared by the Company solely
for use in connection with the Original Sale and the Company did
not participate in or facilitate in any way the purchase of the
Certificates by the Purchaser from the Seller, and the Purchaser
agrees that it will look solely to the Seller and not to the
Company with respect to any damage, liability, claim or expense
arising out of, resulting from or in connection with (a) error or
omission, or alleged error or omission, contained in the
Memorandum, or (b) any information, development or event arising
after the date of the Memorandum.]
5. The Purchaser has not and will not nor has it authorized or will
it authorize any person to (a) offer, pledge, sell, dispose of or
otherwise transfer any Certificate, any interest in any
Certificate or any other similar security to any person in any
manner, (b) solicit any offer to buy or to accept a pledge,
disposition of other transfer of any Certificate, any interest in
any Certificate or any other similar security from any person in
any manner, (c) otherwise approach or negotiate with respect to
any Certificate, any interest in any Certificate or any other
similar security with any person in any manner, (d) make any
general solicitation by means of general advertising or in any
other manner or (e) take any other action, that (as to any of (a)
through (e) above) would constitute a distribution of any
Certificate under the Act, that would render the disposition of
any Certificate a violation of Section 5 of the Act or any state
securities law, or that would require registration or
qualification pursuant thereto. The Purchaser will not sell or
otherwise transfer any of the Certificates, except in compliance
with the provisions of the Pooling and Servicing Agreement.
6. The Purchaser
(a) is not an employee benefit or other plan subject to the
prohibited transaction provisions of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), or Section
4975 of the Internal Revenue Code of 1986, as amended (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 within the meaning of the Department of Labor
("DOL") regulation at 29 C.F.R.ss.2510.3-101, as modified by
Section 3(42) of ERISA; or
(b) is an insurance company, the source of funds to be used by it to
purchase the Certificates is an "insurance company general
account" (within the meaning of DOL 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.
In addition, the Purchaser hereby certifies, represents and warrants
to, and covenants with, the Company, the Trustee and the Master Servicer that
the Purchaser will not transfer such Certificates to any Plan or person
unless such Plan or person meets the requirements set forth in either 6(a) or
(b) above.
Very truly yours,
By: ________________________________
Name:
Title:
EXHIBIT I
FORM OF TRANSFEROR REPRESENTATION LETTER
_________ , 20__
Residential Accredit Loans, Inc.
0000 Xxxxxxxxxx Xxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxxxx, XX 00000
__________________
__________________
__________________
Attention: Residential Funding Company, LLC Series ____-___
Re: Mortgage Asset-Backed Pass-Through
Certificates,
Series ____-___, [Class B-]
Ladies and Gentlemen:
In connection with the sale by _____________ (the "Seller") to
_____________ (the "Purchaser") of $ ______________ Initial Certificate
Principal Balance of Mortgage Asset-Backed Pass-Through Certificates, Series
____-___, Class (the "Certificates"), issued pursuant to the Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement"), dated as of
___________ 1, ____ among Residential Accredit Loans, Inc., as seller (the
"Company"), Residential Funding Company, LLC, as master servicer, and
__________________, as trustee (the "Trustee"). The Seller hereby certifies,
represents and warrants to, and covenants with, the Company and the Trustee
that:
Neither the Seller nor anyone acting on its behalf has (a)
offered, pledged, sold, disposed of or otherwise transferred any Certificate,
any interest in any Certificate or any other similar security to any person
in any manner, (b) has solicited any offer to buy or to accept a pledge,
disposition or other transfer of any Certificate, any interest in any
Certificate or any other similar security from any person in any manner, (c)
has otherwise approached or negotiated with respect to any Certificate, any
interest in any Certificate or any other similar security with any person in
any manner, (d) has made any general solicitation by means of general
advertising or in any other manner, or (e) has taken any other action, that
(as to any of (a) through (e) above) would constitute a distribution of the
Certificates under the Securities Act of 1933 (the "Act"), that would render
the disposition of any Certificate a violation of Section 5 of the Act or any
state securities law, or that would require registration or qualification
pursuant thereto. The Seller will not act, in any manner set forth in the
foregoing sentence with respect to any Certificate. The Seller has not and
will not sell or otherwise transfer any of the Certificates, except in
compliance with the provisions of the Pooling and Servicing Agreement.
Very truly yours,
(Seller)
By: ___________________________
Name:
Title:
EXHIBIT J
[FORM OF RULE 144A INVESTMENT REPRESENTATION]
Description of Rule 144A Securities, including numbers:
The undersigned seller, as registered holder (the "Seller"),
intends to transfer the Rule 144A Securities described above to the
undersigned buyer (the "Buyer").
1. In connection with such transfer and in accordance with the
agreements pursuant to which the Rule 144A Securities were issued, the Seller
hereby certifies the following facts: Neither the Seller nor anyone acting
on its behalf has offered, transferred, pledged, sold or otherwise disposed
of the Rule 144A Securities, any interest in the Rule 144A Securities or any
other similar security to, or solicited any offer to buy or accept a
transfer, pledge or other disposition of the Rule 144A Securities, any
interest in the Rule 144A Securities or any other similar security from, or
otherwise approached or negotiated with respect to the Rule 144A Securities,
any interest in the Rule 144A Securities or any other similar security with,
any person in any manner, or made any general solicitation by means of
general advertising or in any other manner, or taken any other action, that
would constitute a distribution of the Rule 144A Securities under the
Securities Act of 1933, as amended (the "1933 Act"), or that would render the
disposition of the Rule 144A Securities a violation of Section 5 of the 1933
Act or require registration pursuant thereto, and that the Seller has not
offered the Rule 144A Securities to any person other than the Buyer or
another "qualified institutional buyer" as defined in Rule 144A under the
0000 Xxx.
2. The Buyer warrants and represents to, and covenants with, the
Seller, the Trustee and the Master Servicer (as defined in the Pooling and
Servicing Agreement (the "Agreement"), dated as of ___________ 1, ____ among
Residential Funding Company, LLC as Master Servicer, Residential Accredit
Loans, Inc. as depositor pursuant to Section 5.02 of the Agreement and
__________________, as trustee, as follows:
(a) The Buyer understands that the Rule 144A Securities have not been
registered under the 1933 Act or the securities laws of any state.
(b) The Buyer considers itself a substantial, sophisticated
institutional investor having such knowledge and experience in
financial and business matters that it is capable of evaluating the
merits and risks of investment in the Rule 144A Securities.
(c) The Buyer has been furnished with all information regarding the
Rule 144A Securities that it has requested from the Seller, the Trustee
or the Servicer.
(d) Neither the Buyer nor anyone acting on its behalf has offered,
transferred, pledged, sold or otherwise disposed of the Rule 144A
Securities, any interest in the Rule 144A Securities or any other
similar security to, or solicited any offer to buy or accept a
transfer, pledge or other disposition of the Rule 144A Securities, any
interest in the Rule 144A Securities or any other similar security
from, or otherwise approached or negotiated with respect to the Rule
144A Securities, any interest in the Rule 144A Securities or any other
similar security with, any person in any manner, or made any general
solicitation by means of general advertising or in any other manner, or
taken any other action, that would constitute a distribution of the
Rule 144A Securities under the 1933 Act or that would render the
disposition of the Rule 144A Securities a violation of Section 5 of the
1933 Act or require registration pursuant thereto, nor will it act, nor
has it authorized or will it authorize any person to act, in such
manner with respect to the Rule 144A Securities.
(e) The Buyer is a "qualified institutional buyer" as that term is
defined in Rule 144A under the 1933 Act and has completed either of the
forms of certification to that effect attached hereto as Annex 1 or
Annex 2. The Buyer is aware that the sale to it is being made in
reliance on Rule 144A. The Buyer is acquiring the Rule 144A Securities
for its own account or the accounts of other qualified institutional
buyers, understands that such Rule 144A Securities may be resold,
pledged or transferred only (i) to a person reasonably believed to be a
qualified institutional buyer that purchases for its own account or for
the account of a qualified institutional buyer to whom notice is given
that the resale, pledge or transfer is being made in reliance on Rule
144A, or (ii) pursuant to another exemption from registration under the
1933 Act.
[3. The Buyer
[(a) is not an employee benefit or other plan subject to
the prohibited transaction provisions of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), or Section 4975 of the
Internal Revenue Code of 1986, as amended (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 within the meaning of
the Department of Labor ("DOL") regulation at 29 C.F.R.ss.2510.3-101,
as modified by Section 3(42) of ERISA](1); or
(b) is an insurance company, the source of funds to be
used by it to purchase the Certificates is an "insurance company
general account" (within the meaning of DOL 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.](2)
4. This document may be executed in one or more counterparts
and by the different parties hereto on separate counterparts, each of
which, when so executed, shall be deemed to be an original; such
counterparts, together, shall constitute one and the same document.
IN WITNESS WHEREOF, each of the parties has executed this
document as of the date set forth below.
Print Name of Seller Print Name of Buyer
By: By:
Name: Name:
Title: Title:
Taxpayer Identification Taxpayer Identification:
No. No:
Date: Date:
ANNEX 1 TO EXHIBIT J
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Buyers Other Than Registered Investment Companies]
The undersigned hereby certifies as follows in connection with
the Rule 144A Investment Representation to which this Certification is
attached:
1. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the
Buyer.
2. In connection with purchases by the Buyer, the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under
the Securities Act of 1933 ("Rule 144A") because (i) the Buyer owned and/or
invested on a discretionary basis
$ in securities (except for the
excluded securities referred to below) as of the end of the Buyer's most
recent fiscal year (such amount being calculated in accordance with Rule
144A) and (ii) the Buyer satisfies the criteria in the category marked below.
-- Corporation, etc. The Buyer is a corporation (other than a bank,
savings and loan association or similar institution),
Massachusetts or similar business trust, partnership, or
charitable organization described in Section 501(c)(3) of the
Internal Revenue Code.
-- Bank. The Buyer (a) is a national bank or banking institution
organized under the laws of any State, territory or the District
of Columbia, the business of which is substantially confined to
banking and is supervised by the State or territorial banking
commission or similar official or is a foreign bank or equivalent
institution, and (b) has an audited net worth of at least
$25,000,000 as demonstrated in its latest annual financial
statements, a copy of which is attached hereto.
-- Savings and Loan. The Buyer (a) is a savings and loan association,
building and loan association, cooperative bank, homestead
association or similar institution, which is supervised and
examined by a State or Federal authority having supervision over
any such institutions or is a foreign savings and loan
association or equivalent institution and (b) has an audited net
worth of at least $25,000,000 as demonstrated in its latest
annual financial statements.
-- Broker-Dealer. The Buyer is a dealer registered pursuant to Section 15
of the Securities Exchange Act of 1934.
-- Insurance Company. The Buyer is an insurance company whose primary and
predominant business activity is the writing of insurance or the
reinsuring of risks underwritten by insurance companies and which
is subject to supervision by the insurance commissioner or a
similar official or agency of a State or territory or the
District of Columbia.
-- State or Local Plan. The Buyer is a plan established and maintained by
a State, its political subdivisions, or any agency or
instrumentality of the State or its political subdivisions, for
the benefit of its employees.
-- ERISA Plan. The Buyer is an employee benefit plan within the meaning
of Title I of the Employee Retirement Income Security Act of 1974.
-- Investment Adviser. The Buyer is an investment adviser registered
under the Investment Advisers Act of 1940.
-- SBIC. The Buyer is a Small Business Investment Company licensed by the
U.S. Small Business Administration under Section 301(c) or (d) of
the Small Business Investment Act of 1958.
-- Business Development Company. The Buyer is a business development
company as defined in Section 202(a)(22) of the Investment
Advisers Act of 1940.
-- Trust Fund. The Buyer is a trust fund whose trustee is a bank or trust
company and whose participants are exclusively (a) plans
established and maintained by a State, its political
subdivisions, or any agency or instrumentality of the State or
its political subdivisions, for the benefit of its employees, or
(b) employee benefit plans within the meaning of Title I of the
Employee Retirement Income Security Act of 1974, but is not a
trust fund that includes as participants individual retirement
accounts or H.R. 10 plans.
3. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer, (ii) securities
that are part of an unsold allotment to or subscription by the Buyer, if the
Buyer is a dealer, (iii) bank deposit notes and certificates of deposit, (iv)
loan participations, (v) repurchase agreements, (vi) securities owned but
subject to a repurchase agreement and (vii) currency, interest rate and
commodity swaps.
4. For purposes of determining the aggregate amount of securities
owned and/or invested on a discretionary basis by the Buyer, the Buyer used
the cost of such securities to the Buyer and did not include any of the
securities referred to in the preceding paragraph. Further, in determining
such aggregate amount, the Buyer may have included securities owned by
subsidiaries of the Buyer, but only if such subsidiaries are consolidated
with the Buyer in its financial statements prepared in accordance with
generally accepted accounting principles and if the investments of such
subsidiaries are managed under the Buyer's direction. However, such
securities were not included if the Buyer is a majority-owned, consolidated
subsidiary of another enterprise and the Buyer is not itself a reporting
company under the Securities Exchange Act of 1934.
5. The Buyer acknowledges that it is familiar with Rule 144A and
understands that the seller to it and other parties related to the
Certificates are relying and will continue to rely on the statements made
herein because one or more sales to the Buyer may be in reliance on Rule 144A.
Will the Buyer be purchasing the Rule 144A
Yes No Securities only for the Buyer's own account?
6. If the answer to the foregoing question is "no", the Buyer agrees
that, in connection with any purchase of securities sold to the Buyer for the
account of a third party (including any separate account) in reliance on Rule
144A, the Buyer will only purchase for the account of a third party that at
the time is a "qualified institutional buyer" within the meaning of Rule
144A. In addition, the Buyer agrees that the Buyer will not purchase
securities for a third party unless the Buyer has obtained a current
representation letter from such third party or taken other appropriate steps
contemplated by Rule 144A to conclude that such third party independently
meets the definition of "qualified institutional buyer" set forth in Rule
144A.
7. The Buyer will notify each of the parties to which this
certification is made of any changes in the information and conclusions
herein. Until such notice is given, the Buyer's purchase of Rule 144A
Securities will constitute a reaffirmation of this certification as of the
date of such purchase.
Print Name of Buyer
By:___________________________________
Name:
Title:
Date: _______________________________
ANNEX 2 TO EXHIBIT J
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Buyers That Are Registered Investment Companies]
The undersigned hereby certifies as follows in connection with
the Rule 144A Investment Representation to which this Certification is
attached:
8. As indicated below, the undersigned is the President, Chief
Financial Officer or Senior Vice President of the Buyer or, if the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under
the Securities Act of 1933 ("Rule 144A") because Buyer is part of a Family of
Investment Companies (as defined below), is such an officer of the Adviser.
9. In connection with purchases by Buyer, the Buyer is a "qualified
institutional buyer" as defined in SEC Rule 144A because (i) the Buyer is an
investment company registered under the Investment Company Act of 1940, and
(ii) as marked below, the Buyer alone, or the Buyer's Family of Investment
Companies, owned at least $100,000,000 in securities (other than the excluded
securities referred to below) as of the end of the Buyer's most recent fiscal
year. For purposes of determining the amount of securities owned by the
Buyer or the Buyer's Family of Investment Companies, the cost of such
securities was used.
-- The Buyer owned $ ____________________________________ in securities
(other than the excluded securities referred to below) as of the
end of the Buyer's most recent fiscal year (such amount being
calculated in accordance with Rule 144A).
-- The Buyer is part of a Family of Investment Companies which owned in
the aggregate $____________________________ in securities (other
than the excluded securities referred to below) as of the end of
the Buyer's most recent fiscal year (such amount being calculated
in accordance with Rule 144A).
10. The term "Family of Investment Companies" as used herein means
two or more registered investment companies (or series thereof) that have the
same investment adviser or investment advisers that are affiliated (by virtue
of being majority owned subsidiaries of the same parent or because one
investment adviser is a majority owned subsidiary of the other).
11. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer or are part of the
Buyer's Family of Investment Companies, (ii) bank deposit notes and
certificates of deposit, (iii) loan participations, (iv) repurchase
agreements, (v) securities owned but subject to a repurchase agreement and
(vi) currency, interest rate and commodity swaps.
12. The Buyer is familiar with Rule 144A and understands that each of
the parties to which this certification is made are relying and will continue
to rely on the statements made herein because one or more sales to the Buyer
will be in reliance on Rule 144A. In addition, the Buyer will only purchase
for the Buyer's own account.
13. The undersigned will notify each of the parties to which this
certification is made of any changes in the information and conclusions
herein. Until such notice, the Buyer's purchase of Rule 144A Securities will
constitute a reaffirmation of this certification by the undersigned as of the
date of such purchase.
Print Name of Buyer
By: ______________________________
Name:
Title:
IF AN ADVISER:
Print Name of Buyer
Date:
EXHIBIT K
[TEXT OF AMENDMENT TO POOLING AND SERVICING
AGREEMENT PURSUANT TO SECTION 11.01(E) FOR A
LIMITED GUARANTY]
ARTICLE XIII
Subordinate Certificate Loss Coverage; Limited Guaranty
Section 13.01. Subordinate Certificate Loss Coverage; Limited
Guaranty. (a) Subject to subsection (c) below, prior to the later of the
third Business Day prior to each Distribution Date or the related
Determination Date, the Master Servicer shall determine whether it or any
Sub-Servicer will be entitled to any reimbursement pursuant to Section
4.02(a) on such Distribution Date for Advances or Sub-Servicer Advances
previously made, (which will not be Advances or Sub-Servicer Advances that
were made with respect to delinquencies which were subsequently determined to
be Excess Special Hazard Losses, Excess Fraud Losses, Excess Bankruptcy
Losses or Extraordinary Losses) and, if so, the Master Servicer shall demand
payment from Residential Funding of an amount equal to the amount of any
Advances or Sub-Servicer Advances reimbursed pursuant to Section 4.02(a), to
the extent such Advances or Sub-Servicer Advances have not been included in
the amount of the Realized Loss in the related Mortgage Loan, and shall
distribute the same to the Class B Certificateholders in the same manner as
if such amount were to be distributed pursuant to Section 4.02(a).
(b) Subject to subsection (c) below, prior to the later of the
third Business Day prior to each Distribution Date or the related
Determination Date, the Master Servicer shall determine whether any Realized
Losses (other than Excess Special Hazard Losses, Excess Bankruptcy Losses,
Excess Fraud Losses and Extraordinary Losses) will be allocated to the Class
B Certificates on such Distribution Date pursuant to Section 4.05, and, if
so, the Master Servicer shall demand payment from Residential Funding of the
amount of such Realized Loss and shall distribute the same to the Class B
Certificateholders in the same manner as if such amount were to be
distributed pursuant to Section 4.02(a); provided, however, that the amount
of such demand in respect of any Distribution Date shall in no event be
greater than the sum of (i) the additional amount of Accrued Certificate
Interest that would have been paid for the Class B Certificateholders on such
Distribution Date had such Realized Loss or Losses not occurred plus (ii) the
amount of the reduction in the Certificate Principal Balances of the Class B
Certificates on such Distribution Date due to such Realized Loss or Losses.
Notwithstanding such payment, such Realized Losses shall be deemed to have
been borne by the Certificateholders for purposes of Section 4.05. Excess
Special Hazard Losses, Excess Fraud Losses, Excess Bankruptcy Losses and
Extraordinary Losses allocated to the Class B Certificates will not be
covered by the Subordinate Certificate Loss Obligation.
(c) Demands for payments pursuant to this Section shall be made
prior to the later of the third Business Day prior to each Distribution Date
or the related Determination Date by the Master Servicer with written notice
thereof to the Trustee. The maximum amount that Residential Funding shall be
required to pay pursuant to this Section on any Distribution Date (the
"Amount Available") shall be equal to the lesser of (X)
minus the sum of (i) all previous payments made under subsections (a) and (b)
hereof and (ii) all draws under the Limited Guaranty made in lieu of such
payments as described below in subsection (d) and (Y) the then outstanding
Certificate Principal Balances of the Class B Certificates, or such lower
amount as may be established pursuant to Section 13.02. Residential
Funding's obligations as described in this Section are referred to herein as
the "Subordinate Certificate Loss Obligation."
(d) The Trustee will promptly notify GMAC LLC of any failure of
Residential Funding to make any payments hereunder and shall demand payment
pursuant to the limited guaranty (the "Limited Guaranty"), executed by GMAC
LLC, of Residential Funding's obligation to make payments pursuant to this
Section, in an amount equal to the lesser of (i) the Amount Available and
(ii) such required payments, by delivering to GMAC LLC a written demand for
payment by wire transfer, not later than the second Business Day prior to the
Distribution Date for such month, with a copy to the Master Servicer.
(e) All payments made by Residential Funding pursuant to this
Section or amounts paid under the Limited Guaranty shall be deposited
directly in the Certificate Account, for distribution on the Distribution
Date for such month to the Class B Certificateholders.
(f) The Company shall have the option, in its sole discretion,
to substitute for either or both of the Limited Guaranty or the Subordinate
Certificate Loss Obligation another instrument in the form of a corporate
guaranty, an irrevocable letter of credit, a surety bond, insurance policy or
similar instrument or a reserve fund; provided that (i) the Company obtains
(subject to the provisions of Section 10.01(f) as if the Company was
substituted for the Master Servicer solely for the purposes of such
provision) an Opinion of Counsel (which need not be an opinion of Independent
counsel) to the effect that obtaining such substitute corporate guaranty,
irrevocable letter of credit, surety bond, insurance policy or similar
instrument or reserve fund will not cause either (a) any federal tax to be
imposed on the Trust Fund, including without limitation, any federal tax
imposed on "prohibited transactions" under Section 860(F)(a)(1) of the Code
or on "contributions after the startup date" under Section 860(G)(d)(1) of
the Code or (b) the Trust Fund to fail to qualify as a REMIC at any time that
any Certificate is outstanding, and (ii) no such substitution shall be made
unless (A) the substitute Limited Guaranty or Subordinate Certificate Loss
Obligation is for an initial amount not less than the then current Amount
Available and contains provisions that are in all material respects
equivalent to the original Limited Guaranty or Subordinate Certificate Loss
Obligation (including that no portion of the fees, reimbursements or other
obligations under any such instrument will be borne by the Trust Fund), (B)
the long term debt obligations of any obligor of any substitute Limited
Guaranty or Subordinate Certificate Loss Obligation (if not supported by the
Limited Guaranty) shall be rated at least the lesser of (a) the rating of the
long term debt obligations of GMAC LLC as of the date of issuance of the
Limited Guaranty and (b) the rating of the long term debt obligations of GMAC
LLC at the date of such substitution and (C) the Company obtains written
confirmation from each nationally recognized credit rating agency that rated
the Class B Certificates at the request of the Company that such substitution
shall not lower the rating on the Class B Certificates below the lesser of
(a) the then-current rating assigned to the Class B Certificates by such
rating agency and (b) the original rating assigned to the Class B
Certificates by such rating agency. Any replacement of the Limited Guaranty
or Subordinate Certificate Loss Obligation pursuant to this Section shall be
accompanied by a written Opinion of Counsel to the substitute guarantor or
obligor, addressed to the Master Servicer and the Trustee, that such
substitute instrument constitutes a legal, valid and binding obligation of
the substitute guarantor or obligor, enforceable in accordance with its
terms, and concerning such other matters as the Master Servicer and the
Trustee shall reasonably request. Neither the Company, the Master Servicer
nor the Trustee shall be obligated to substitute for or replace the Limited
Guaranty or Subordinate Certificate Loss Obligation under any circumstance.
Section 13.02. Amendments Relating to the Limited Guaranty.
Notwithstanding Sections 11.01 or 13.01: (i) the provisions of this Article
XIII may be amended, superseded or deleted, (ii) the Limited Guaranty or
Subordinate Certificate Loss Obligation may be amended, reduced or canceled,
and (iii) any other provision of this Agreement which is related or
incidental to the matters described in this Article XIII may be amended in
any manner; in each case by written instrument executed or consented to by
the Company and Residential Funding but without the consent of any
Certificateholder and without the consent of the Master Servicer or the
Trustee being required unless any such amendment would impose any additional
obligation on, or otherwise adversely affect the interests of, the Master
Servicer or the Trustee, as applicable; provided that the Company shall also
obtain a letter from each nationally recognized credit rating agency that
rated the Class B Certificates at the request of the Company to the effect
that such amendment, reduction, deletion or cancellation will not lower the
rating on the Class B Certificates below the lesser of (a) the then-current
rating assigned to the Class B Certificates by such rating agency and (b) the
original rating assigned to the Class B Certificates by such rating agency,
unless (A) the Holder of 100% of the Class B Certificates is Residential
Funding or an Affiliate of Residential Funding, or (B) such amendment,
reduction, deletion or cancellation is made in accordance with Section
11.01(e) and, provided further that the Company obtains (subject to the
provisions of Section 10.01(f) as if the Company was substituted for the
Master Servicer solely for the purposes of such provision), in the case of a
material amendment or supercession (but not a reduction, cancellation or
deletion of the Limited Guaranty or the Subordinate Certificate Loss
Obligation), an Opinion of Counsel (which need not be an opinion of
Independent counsel) to the effect that any such amendment or supercession
will not cause either (a) any federal tax to be imposed on the Trust Fund,
including without limitation, any federal tax imposed on "prohibited
transactions" under Section 860F(a)(1) of the Code or on "contributions after
the startup date" under Section 860G(d)(1) of the Code or (b) the Trust Fund
to fail to qualify as a REMIC at any time that any Certificate is
outstanding. A copy of any such instrument shall be provided to the Trustee
and the Master Servicer together with an Opinion of Counsel that such
amendment complies with this Section 13.02.
EXHIBIT L
[FORM OF LIMITED GUARANTY]
LIMITED GUARANTY
RESIDENTIAL ACCREDIT LOANS, INC.
Mortgage Asset-Backed Pass-Through Certificates
Series ____-___
_________ , 200
__________________
__________________
__________________
Attention: Residential Funding Company, LLC Series ____-___
Ladies and Gentlemen:
WHEREAS, Residential Funding Company, LLC, a Delaware limited
liability company ("Residential Funding"), an indirect wholly-owned
subsidiary of GMAC LLC, a Delaware limited liability company ("GMAC"), plans
to incur certain obligations as described under Section 13.01 of the Pooling
and Servicing Agreement dated as of ___________ 1, ____ (the "Servicing
Agreement"), among Residential Accredit Loans, Inc. (the "Company"),
Residential Funding and __________________ (the "Trustee") as amended by
Amendment No. thereto, dated as of , with respect to
the Mortgage Asset-Backed Pass-Through Certificates, Series ____-___ (the
"Certificates"); and
WHEREAS, pursuant to Section 13.01 of the Servicing Agreement,
Residential Funding agrees to make payments to the Holders of the Class B
Certificates with respect to certain losses on the Mortgage Loans as
described in the Servicing Agreement; and
WHEREAS, GMAC desires to provide certain assurances with respect
to the ability of Residential Funding to secure sufficient funds and
faithfully to perform its Subordinate Certificate Loss Obligation;
NOW THEREFORE, in consideration of the premises herein contained
and certain other good and valuable consideration, the receipt of which is
hereby acknowledged, GMAC agrees as follows:
1. Provision of Funds. (a) GMAC agrees to contribute and deposit in
the Certificate Account on behalf of Residential Funding (or otherwise
provide to Residential Funding, or to cause to be made available to
Residential Funding), either directly or through a subsidiary, in any case
prior to the related Distribution Date, such moneys as may be required by
Residential Funding to perform its Subordinate Certificate Loss Obligation
when and as the same arises from time to time upon the demand of the Trustee
in accordance with Section 13.01 of the Servicing Agreement.
(b) The agreement set forth in the preceding clause (a) shall
be absolute, irrevocable and unconditional and shall not be affected by the
transfer by GMAC or any other person of all or any part of its or their
interest in Residential Funding, by any insolvency, bankruptcy, dissolution
or other proceeding affecting Residential Funding or any other person, by any
defense or right of counterclaim, set-off or recoupment that GMAC may have
against Residential Funding or any other person or by any other fact or
circumstance. Notwithstanding the foregoing, GMAC's obligations under clause
(a) shall terminate upon the earlier of (x) substitution for this Limited
Guaranty pursuant to Section 13.01(f) of the Servicing Agreement, or (y) the
termination of the Trust Fund pursuant to the Servicing Agreement.
2. Waiver. GMAC hereby waives any failure or delay on the part of
Residential Funding, the Trustee or any other person in asserting or
enforcing any rights or in making any claims or demands hereunder. Any
defective or partial exercise of any such rights shall not preclude any other
or further exercise of that or any other such right. GMAC further waives
demand, presentment, notice of default, protest, notice of acceptance and any
other notices with respect to this Limited Guaranty, including, without
limitation, those of action or nonaction on the part of Residential Funding
or the Trustee.
3. Modification, Amendment and Termination. This Limited Guaranty
may be modified, amended or terminated only by the written agreement of GMAC
and the Trustee and only if such modification, amendment or termination is
permitted under Section 13.02 of the Servicing Agreement. The obligations of
GMAC under this Limited Guaranty shall continue and remain in effect so long
as the Servicing Agreement is not modified or amended in any way that might
affect the obligations of GMAC under this Limited Guaranty without the prior
written consent of GMAC.
4. Successor. Except as otherwise expressly provided herein, the
guarantee herein set forth shall be binding upon GMAC and its respective
successors.
5. Governing Law. This Limited Guaranty shall be governed by the
laws of the State of New York.
6. Authorization and Reliance. GMAC understands that a copy of this
Limited Guaranty shall be delivered to the Trustee in connection with the
execution of Amendment No. 1 to the Servicing Agreement and GMAC hereby
authorizes the Company and the Trustee to rely on the covenants and
agreements set forth herein.
7. Definitions. Capitalized terms used but not otherwise defined
herein shall have the meaning given them in the Servicing Agreement.
8. Counterparts. This Limited Guaranty may be executed in any
number of counterparts, each of which shall be deemed to be an original and
such counterparts shall constitute but one and the same instrument.
IN WITNESS WHEREOF, GMAC has caused this Limited Guaranty to be
executed and delivered by its respective officers thereunto duly authorized
as of the day and year first above written.
GMAC LLC
By: ___________________________
Name:
Title:
Acknowledged by:
__________________,
as Trustee
By: ___________________________
Name:
Title:
RESIDENTIAL ACCREDIT LOANS, INC.
By: ___________________________
Name:
Title:
EXHIBIT M
FORM OF LENDER CERTIFICATION FOR ASSIGNMENT OF MORTGAGE LOAN
___________, 20
Residential Accredit Loans, Inc.
0000 Xxxxxxxxxx Xxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxx 00000
__________________
__________________
__________________
Attention: Residential Funding Company, LLC Series ____-___
Re: Mortgage Asset-Backed Pass-Through
Certificates, Series ____-___ Assignment
of Mortgage Loan
Ladies and Gentlemen:
This letter is delivered to you in connection with the assignment
by _______________ (the "Trustee") to_____________________ (the "Lender") of
________________________________ (the "Mortgage Loan") pursuant to Section
3.13(d) of the Pooling and Servicing Agreement (the "Pooling and Servicing
Agreement"), dated as of ___________ 1, ____ among Residential Accredit
Loans, Inc., as seller (the "Company"), Residential Funding Company, LLC, as
Master Servicer, and the Trustee. All terms used herein and not otherwise
defined shall have the meanings set forth in the Pooling and Servicing
Agreement. The Lender hereby certifies, represents and warrants to, and
covenants with, the Master Servicer and the Trustee that:
(i) the Mortgage Loan is secured by Mortgaged Property located in a
jurisdiction in which an assignment in lieu of satisfaction is required to
preserve lien priority, minimize or avoid mortgage recording taxes or
otherwise comply with, or facilitate a refinancing under, the laws of such
jurisdiction;
(ii) the substance of the assignment is, and is intended to be, a
refinancing of such Mortgage Loan and the form of the transaction is solely
to comply with, or facilitate the transaction under, such local laws;
(iii) the Mortgage Loan following the proposed assignment will be
modified to have a rate of interest at least 0.25 percent below or above the
rate of interest on such Mortgage Loan prior to such proposed assignment; and
(iv) such assignment is at the request of the borrower under the
related Mortgage Loan.
Very truly yours,
(Lender)
By: ________________________________
Name:
Title:
EXHIBIT N
FORM OF REQUEST FOR EXCHANGE
[DATE]
__________________
__________________
__________________
Re: Residential Accredit Loans, Inc.,
Mortgage Asset-Backed Pass-Through
Certificates,
Series ____-___
Residential Funding Company, LLC, as the Holder of a ____%
Percentage Interest of the [Interest Only/Class A-V][-1] Certificates, hereby
requests the Trustee to exchange the above-referenced Certificates for the
Subclasses referred to below:
1. [Interest Only/Class A-V]- Certificates, corresponding to the
following Uncertificated REMIC Regular Interests: [List
numbers corresponding to the related loans and Pool Strip
Rates from the Mortgage Loan Schedule]. The initial
Subclass Notional Amount and the Initial Pass-Through Rate
on the [Interest Only/Class A-V]- Certificates will be
$ _____________ and ___________%, respectively.
2. [Repeat as appropriate.]
The Subclasses requested above will represent in the aggregate
all of the Uncertificated REMIC Regular Interests represented by the
[Interest Only/Class A-V][-1] Certificates surrendered for exchange.
All capitalized terms used but not defined herein shall have the
meanings set forth in the Pooling and Servicing Agreement, dated as of
___________ 1, ____, among Residential Accredit Loans, Inc., Residential
Funding Company, LLC and __________________, as trustee.
RESIDENTIAL FUNDING COMPANY, LLC
By: ____________________________
Name:
Title:
EXHIBIT O
Form of Form 10-K Certification
I, [identify the certifying individual], certify that:
1. I have reviewed this report on Form 10-K and all reports on Form
10-D required to be filed in respect of the period covered by this report on
Form 10-K of the trust (the "Exchange Act periodic reports") created pursuant
to the Series Supplement dated ___________________ to the Standard Terms of
Pooling and Servicing Agreement dated ____________________ (together, the
"P&S Agreement") among Residential Accredit Loans, Inc., Residential Funding
Company, LLC (the "Master Servicer") and [Name of Trustee] (the "Trustee");
2. Based on my knowledge, the Exchange Act periodic reports, taken
as a whole, do not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading with
respect to the period covered by this report;
3. Based on my knowledge, all of the distribution, servicing and
other information required to be provided under Form 10-D for the period
covered by this report is included in the Exchange Act periodic reports;
4. I am responsible for reviewing the activities performed by the
Master Servicer and based on my knowledge and the compliance review conducted
in preparing the servicer compliance statement required in this report under
Item 1123 of Regulation AB, and except a disclosed in the Exchange Act
periodic reports, the Master Servicer has fulfilled its obligations under the
P&S Agreement; and
5. All of the reports on assessment of compliance with servicing
criteria for asset-backed securities and their related attestation reports on
assessment of compliance with servicing criteria for asset-backed securities
required to be included in this report in accordance with Item 1122 of
Regulation AB and Exchange Act Rules 13a-18 and 15d-18 have been included as
an exhibit to this report, except as otherwise disclosed in this report. Any
material instances of noncompliance described in such reports have been
disclosed in this report on Form 10-K.
In giving the certifications above, I have reasonably relied on the
information provided to me by the following unaffiliated parties: [the
Trustee].
Date:_______________________
____________________________*
[Signature]
[Title:]
* to be signed by the senior officer in charge of the servicing functions of
the Master Servicer
EXHIBIT P
[FORM OF BACK-UP CERTIFICATION TO FORM 10-K CERTIFICATE]
The undersigned, a Responsible Officer of [_________] (the "Trustee")
certifies that:
(a) The Trustee has performed all of the duties specifically required
to be performed by it pursuant to the provisions of the Pooling and Servicing
Agreement dated as of [_________], 20[__] (the "Agreement") by and among
[__________], as depositor, Residential Funding Company, LLC, as Master
Servicer, and the Trustee in accordance with the standards set forth therein.
(b) Based on my knowledge, the list of Certificateholders as shown on
the Certificate Register as of the end of each calendar year that is provided
by the Trustee pursuant to the Agreement is accurate as of the last day of
the 20[__] calendar year.
Capitalized terms used and not defined herein shall have the meanings given
such terms in the Agreement.
IN WITNESS WHEREOF, I have duly executed this certificate as of
_________, 20__.]
Name:_____________________________
Title:
EXHIBIT Q
INFORMATION TO BE PROVIDED BY THE MASTER SERVICER TO THE RATING AGENCIES
RELATING TO REPORTABLE MODIFIED MORTGAGE LOANS
Account number
Transaction Identifier
Unpaid Principal Balance prior to Modification
Next Due Date
Monthly Principal and Interest Payment
Total Servicing Advances
Current Interest Rate
Original Maturity Date
Original Term to Maturity (Months)
Remaining Term to Maturity (Months)
Trial Modification Indicator
Mortgagor Equity Contribution
Total Servicer Advances
Trial Modification Term (Months)
Trial Modification Start Date
Trial Modification End Date
Trial Modification Period Principal and Interest Payment
Trial Modification Interest Rate
Trial Modification Term
Rate Reduction Indicator
Interest Rate Post Modification
Rate Reduction Start Date
Rate Reduction End Date
Rate Reduction Term
Term Modified Indicator
Modified Amortization Period
Modified Final Maturity Date
Total Advances Written Off
Unpaid Principal Balance Written Off
Other Past Due Amounts Written Off
Write Off Date
Unpaid Principal Balance Post Write Off
Capitalization Indicator
Mortgagor Contribution
Total Capitalized Amount
Modification Close Date
Unpaid Principal Balance Post Capitalization Modification
Next Payment Due Date per Modification Plan
Principal and Interest Payment Post Modification
Interest Rate Post Modification
Payment Made Post Capitalization
Delinquency Status to Modification Plan
EXHIBIT R
SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The assessment of compliance to be delivered by the Trustee shall
address, at a minimum, the criteria identified as below as "Applicable
Servicing Criteria":
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APPLICABLE
SERVICING
SERVICING CRITERIA CRITERIA
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REFERENCE CRITERIA
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GENERAL SERVICING CONSIDERATIONS
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1122(d)(1)(i) Policies and procedures are instituted to
monitor any performance or other triggers and
events of default in accordance with the
transaction agreements.
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1122(d)(1)(ii)If any material servicing activities are
outsourced to third parties, policies and
procedures are instituted to monitor the third
party's performance and compliance with such
servicing activities.
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1122(d)(1)(iiiAny requirements in the transaction agreements
to maintain a back-up servicer for the pool
assets are maintained.
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1122(d)(1)(iv)A fidelity bond and errors and omissions
policy is in effect on the party participating
in the servicing function throughout the
reporting period in the amount of coverage
required by and otherwise in accordance with
the terms of the transaction agreements.
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CASH COLLECTION AND ADMINISTRATION
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1122(d)(2)(i) Payments on pool assets are deposited into the |X| (as to
appropriate custodial bank accounts and accounts held
related bank clearing accounts no more than by Trustee)
two business days following receipt, or such
other number of days specified in the
transaction agreements.
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1122(d)(2)(ii)Disbursements made via wire transfer on behalf |X| (as to
of an obligor or to an investor are made only investors only)
by authorized personnel.
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1122(d)(2)(iiiAdvances of funds or guarantees regarding
collections, cash flows or distributions, and
any interest or other fees charged for such
advances, are made, reviewed and approved as
specified in the transaction agreements.
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The related accounts for the transaction, such
as cash reserve accounts or accounts
established as a form of |X| (as to
overcollateralization, are separately accounts held
maintained (e.g., with respect to commingling by Trustee)
of cash) as set forth in the transaction
1122(d)(2)(iv)agreements.
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1122(d)(2)(v) Each custodial account is maintained at a
federally insured depository institution as
set forth in the transaction agreements. For
purposes of this criterion, "federally insured
depository institution" with respect to a
foreign financial institution means a foreign
financial institution that meets the
requirements of Rule 13k-1(b)(1) of the
Securities Exchange Act.
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1122(d)(2)(vi)Unissued checks are safeguarded so as to
prevent unauthorized access.
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1122(d)(2)(viiReconciliations are prepared on a monthly
basis for all asset-backed securities related
bank accounts, including custodial accounts
and related bank clearing accounts. These
reconciliations are (A) mathematically
accurate; (B) prepared within 30 calendar days
after the bank statement cutoff date, or such
other number of days specified in the
transaction agreements; (C) reviewed and
approved by someone other than the person who
prepared the reconciliation; and (D) contain
explanations for reconciling items. These
reconciling items are resolved within 90
calendar days of their original
identification, or such other number of days
specified in the transaction agreements.
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INVESTOR REMITTANCES AND REPORTING
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1122(d)(3)(i) Reports to investors, including those to be
filed with the Commission, are maintained in
accordance with the transaction agreements and
applicable Commission requirements.
Specifically, such reports (A) are prepared in
accordance with timeframes and other terms set
forth in the transaction agreements; (B)
provide information calculated in accordance
with the terms specified in the transaction
agreements; (C) are filed with the Commission
as required by its rules and regulations; and
(D) agree with investors' or the trustee's
records as to the total unpaid principal
balance and number of pool assets serviced by
the servicer.
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1122(d)(3)(ii)Amounts due to investors are allocated and |X|
remitted in accordance with timeframes,
distribution priority and other terms set
forth in the transaction agreements.
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Disbursements made to an investor are posted
within two business days to the servicer's
investor records, or such other number of days |X|
1122(d)(3)(iiispecified in the transaction agreements.
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Amounts remitted to investors per the investor
reports agree with cancelled checks, or other |X|
1122(d)(3)(iv)form of payment, or custodial bank statements.
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POOL ASSET ADMINISTRATION
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1122(d)(4)(i) Collateral or security on pool assets is
maintained as required by the transaction
agreements or related asset pool documents.
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Pool assets and related documents are
safeguarded as required by the transaction
1122(d)(4)(ii)agreements
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1122(d)(4)(iiiAny additions, removals or substitutions to
the asset pool are made, reviewed and approved
in accordance with any conditions or
requirements in the transaction agreements.
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1122(d)(4)(iv)Payments on pool assets, including any
payoffs, made in accordance with the related
pool asset documents are posted to the
servicer's obligor records maintained no more
than two business days after receipt, or such
other number of days specified in the
transaction agreements, and allocated to
principal, interest or other items (e.g.,
escrow) in accordance with the related pool
asset documents.
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1122(d)(4)(v) The servicer's records regarding the pool
assets agree with the servicer's records with
respect to an obligor's unpaid principal
balance.
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1122(d)(4)(vi)Changes with respect to the terms or status of
an obligor's pool asset (e.g., loan
modifications or re-agings) are made, reviewed
and approved by authorized personnel in
accordance with the transaction agreements and
related pool asset documents.
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1122(d)(4)(viiLoss mitigation or recovery actions (e.g.,
forbearance plans, modifications and deeds in
lieu of foreclosure, foreclosures and
repossessions, as applicable) are initiated,
conducted and concluded in accordance with the
timeframes or other requirements established
by the transaction agreements.
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1122(d)(4)(viiRecords documenting collection efforts are
maintained during the period a pool asset is
delinquent in accordance with the transaction
agreements. Such records are maintained on at
least a monthly basis, or such other period
specified in the transaction agreements, and
describe the entity's activities in monitoring
delinquent pool assets including, for example,
phone calls, letters and payment rescheduling
plans in cases where delinquency is deemed
temporary (e.g., illness or unemployment).
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1122(d)(4)(ix)Adjustments to interest rates or rates of
return for pool assets with variable rates are
computed based on the related pool asset
documents.
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1122(d)(4)(x) Regarding any funds held in trust for an
obligor (such as escrow accounts): (A) such
funds are analyzed, in accordance with the
obligor's pool asset documents, on at least an
annual basis, or such other period specified
in the transaction agreements; (B) interest on
such funds is paid, or credited, to obligors
in accordance with applicable pool asset
documents and state laws; and (C) such funds
are returned to the obligor within 30 calendar
days of full repayment of the related pool
asset, or such other number of days specified
in the transaction agreements.
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1122(d)(4)(xi)Payments made on behalf of an obligor (such as
tax or insurance payments) are made on or
before the related penalty or expiration
dates, as indicated on the appropriate bills
or notices for such payments, provided that
such support has been received by the servicer
at least 30 calendar days prior to these
dates, or such other number of days specified
in the transaction agreements.
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1122(d)(4)(xiiAny late payment penalties in connection with
any payment to be made on behalf of an obligor
are paid from the servicer's funds and not
charged to the obligor, unless the late
payment was due to the obligor's error or
omission.
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Disbursements made on behalf of an obligor are
posted within two business days to the
obligor's records maintained by the servicer,
or such other number of days specified in the
1122(d)(4)(xiitransaction agreements.
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1122(d)(4)(xivDelinquencies, charge-offs and uncollectible
accounts are recognized and recorded in
accordance with the transaction agreements.
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Any external enhancement or other support,
identified in Item 1114(a)(1) through (3) or
Item 1115 of Regulation AB, is maintained as |X|
1122(d)(4)(xv)set forth in the transaction agreements.
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(1) Only paragraph (a) for Class P Certificates.
(2) Class B Certificateholders may represent to either (a) or (b).
EXHIBIT FOUR:
SWAP AGREEMENT
(PROVIDED UPON REQUEST)
EXHIBIT FIVE:
SB-AM SWAP AGREEMENT
(PROVIDED UPON REQUEST)
EXHIBIT SIX:
YIELD MAINTENANCE AGREEMENT
(PROVIDED UPON REQUEST)
