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 December 1, 2006,
TO
STANDARD TERMS OF
POOLING AND SERVICING AGREEMENT
dated as of December 1, 2006
Mortgage Asset-Backed Pass-Through Certificates
SERIES 2006-QO10
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS................................................................................5
Section 1.01. Definitions.......................................................................5
Section 1.02. Determination of LIBOR...........................................................36
Section 1.03. Use of Words and Phrases.........................................................37
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; ORIGINAL ISSUANCE OF CERTIFICATES...........................37
Section 2.01. Conveyance of Mortgage Loans.....................................................37
Section 2.02. Acceptance by Trustee............................................................37
Section 2.03. Representations, Warranties and Covenants of the Master Servicer and the
Company..........................................................................37
Section 2.04. Representations and Warranties of Sellers........................................40
Section 2.05. Execution and Authentication of Certificates/Issuance of Certificates
Evidencing Interests in REMIC I, REMIC II and REMIC III..........................40
Section 2.06. Conveyance of Uncertificated Regular Interests; Acceptance by the Trustee........41
Section 2.07. Issuance of Certificates Evidencing Interest in REMIC II and REMIC III...........41
Section 2.08. Purposes and Powers of the Trust.................................................41
Section 2.09. Agreement Regarding Ability to Disclose..........................................41
ARTICLE III ADMINISTRATION AND SERVICING OF MORTGAGE LOANS............................................43
Section 3.01. Master Servicer to act as Servicer...............................................43
Section 3.02. Subservicing Agreements Between Master Servicer and Subservicers;
Enforcement of Subservicers' and Sellers' Obligations............................43
Section 3.03. Successor Subservicers...........................................................43
Section 3.04. Liability of the Master Servicer.................................................43
Section 3.05. No Contractual Relationship Between Subservicer and Trustee or
Certificateholders...............................................................43
Section 3.06. Assumption or Termination of Subservicing Agreements by Trustee..................43
Section 3.07. Collection of Certain Mortgage Loan Payments; Deposit to Custodial
Account..........................................................................43
Section 3.08. Subservicing Accounts; Servicing Accounts........................................45
Section 3.09. Access to Certain Documentation and Information Regarding the Mortgage
Loans ...........................................................................45
Section 3.10. Permitted withdrawals from the Custodial Account.................................45
Section 3.11. Maintenance of the Primary Insurance Policies; Collections Thereunder...........45
Section 3.12. Maintenance of Fire Insurance and Omissions and Fidelity Coverage...............45
Section 3.13. Enforcement of Due-on-Sale Clauses; Assumption and Modification
Agreements; Certain Assignments..................................................45
Section 3.14. Realization Upon Defaulted Mortgage Loans........................................45
Section 3.15. Trustee to Cooperate; Release of Mortgage Files..................................45
Section 3.16. Servicing and Other Compensation; Compensating Interest..........................45
Section 3.17. Reports to the Trustee and the Company...........................................46
Section 3.18. Annual Statement as to Compliance................................................46
Section 3.19. Annual Independent Public Accountants' Servicing Report..........................46
Section 3.20. Rights of the Company in Respect of the Master Servicer..........................46
Section 3.21. Administration of Buydown Funds..................................................46
Section 3.22. Advance Facility.................................................................46
ARTICLE IV PAYMENTS TO CERTIFICATEHOLDERS............................................................47
Section 4.01. Certificate Account..............................................................47
Section 4.02. Distributions....................................................................47
Section 4.03. Statements to Certificateholders; Statements to the Rating Agencies;
Exchange Act Reporting...........................................................52
Section 4.04. Distribution of Reports to the Trustee and the Company; Advances by the
Master Servicer..................................................................52
Section 4.05. Allocation of Realized Losses....................................................54
Section 4.06. Reports of Foreclosures and Abandonment of Mortgaged Property....................55
Section 4.07. Optional Purchase of Defaulted Mortgage Loans....................................56
Section 4.08. Surety Bond......................................................................56
Section 4.09. Basis Risk Shortfall Reserve Fund................................................56
Section 4.10. Final Maturity Reserve Account...................................................56
ARTICLE V THE CERTIFICATES..........................................................................58
Section 5.01. The Certificates.................................................................58
Section 5.02. Registration of Transfer and Exchange of Certificates............................58
ARTICLE VI THE COMPANY AND THE MASTER SERVICER.......................................................64
Section 6.01. Respective Liabilities of the Company and Master Servicer........................64
Section 6.02. Merger or Consolidation of the Company or Master Servicer; Assignment of
Rights and Delegation of Duties by the Master Servicer...........................64
Section 6.03. Limitation on Liability of the Company, Master Servicer and Others...............64
Section 6.04. Company and Master Servicer Not to Resign........................................64
ARTICLE VII DEFAULT...................................................................................65
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...................................................69
Section 8.04. Trustee and Supplemental Interest Trust Trustee May Own Certificates.............70
Section 8.05. Master Servicer to Pay Trustee's Fees and Expenses; Indemnification..............70
Section 8.06. Eligibility Requirements for Trustee.............................................71
Section 8.07. Resignation and Removal of the Trustee and Supplemental Interest Trust
Trustee..........................................................................71
Section 8.08. Successor Trustee and Successor Supplemental Interest Trust Trustee..............73
Section 8.09. Merger or Consolidation of Trustee ..............................................73
Section 8.10. Appointment of Co-Trustee or Separate Trustee....................................74
Section 8.11. Appointment of Custodians........................................................74
Section 8.12. Appointment of Office or Agency..................................................74
ARTICLE IX TERMINATION OR OPTIONAL PURCHASE OF ALL CERTIFICATES......................................75
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........75
Section 9.02. Additional Termination Requirements..............................................77
Section 9.03. Termination of Multiple REMICs...................................................77
ARTICLE X REMIC PROVISIONS..........................................................................78
Section 10.01. REMIC Administration.............................................................78
Section 10.02. Master Servicer; REMIC Administrator and Trustee Indemnification.................78
Section 10.03. Designation of REMICs............................................................78
Section 10.04. Distributions on the REMIC I Regular Interests...................................78
Section 10.05. Compliance with Withholding Requirements.........................................78
ARTICLE XI MISCELLANEOUS PROVISIONS..................................................................80
Section 11.01. Amendment........................................................................80
Section 11.02. Recordation of Agreement; Counterparts...........................................80
Section 11.03. Limitation on Rights of Certificateholders.......................................80
Section 11.04. Governing Laws...................................................................80
Section 11.05. Notices..........................................................................80
Section 11.06. Required Notices to Rating Agency and Subservicer................................81
Section 11.07. Severability of Provisions.......................................................81
Section 11.08. Supplemental Provisions for Resecuritization.....................................81
Section 11.09. Allocation of Voting Rights......................................................81
Section 11.10. No Petition......................................................................81
ARTICLE XII COMPLIANCE WITH REGULATION AB.............................................................82
EXHIBITS AND SCHEDULES
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 December 1, 2006
Exhibit Four: Form of Certificate to be Given by Certificate Owner
Exhibit Five: Form of Certificate to be Given by Euroclear or Clearstream Banking
Exhibit Six: Form of Transfer Certificate for Exchange or Transfer from 144A Book-Entry
Certificate to Regulation S Book-Entry Certificate
Exhibit Seven: Form of Certificate to be Given by Transferree of Beneficial Interest in a
Regulation S Book-Entry Certificate
Exhibit Eight: Form of Initial Purchaser Exchange Instructions
Exhibit Nine-A: Form of Rule 144A Global Class [B/SB/P] Certificate
Exhibit Nine-B: Form of Permanent Regulation S Global Class [B/SB/P] Certificate
Exhibit Nine-C: Form of Temporary Regulation S Global Class [B/SB/P] Certificate
Schedule 1
This is a Series Supplement, dated as of December 1, 2006 (the "Series Supplement"), to the Standard
Terms of Pooling and Servicing Agreement, dated as of December 1, 2006 and attached as Exhibit Three 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 "Supplemental Interest Trust
Trustee").
PRELIMINARY STATEMENT:
The Company intends to sell mortgage asset-backed pass-through certificates (collectively, the
"Certificates"), to be issued hereunder in multiple classes, which in the aggregate will evidence the entire
beneficial ownership interest in the Mortgage Loans.
The terms and provisions of the Standard Terms are hereby incorporated by reference herein as though set
forth in full herein. If any term or provision contained herein shall conflict with or be inconsistent with any
provision contained in the Standard Terms, the terms and provisions of this Series Supplement shall govern. All
capitalized terms not otherwise defined herein shall have the meanings set forth in the Standard Terms. The
Pooling and Servicing Agreement shall be dated as of the date of this Series Supplement.
REMIC I
As provided herein, the REMIC Administrator will make an election to treat the segregated pool of assets
consisting of the Mortgage Loans and certain other related assets subject to this Agreement (but excluding the
Basis Risk Shortfall Reserve Fund and the Final Maturity Reserve Account) as a real estate mortgage investment
conduit (a "REMIC") for federal income tax purposes, and such segregated pool of assets will be designated as
"REMIC I." The Class R-I Certificates will represent the sole Class of "residual interests" in REMIC I for
purposes of the REMIC Provisions (as defined herein) under federal income tax law. The Class R-I 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
DESIGNATION PASS-THROUGH RATE PRINCIPAL BALANCE
LT1 Variable(1) $ 900,074,304.31
LT2 Variable(1) $ 44,785.40
LT3 0.00% $ 45,235.56
LT4 Variable(1) $ 45,235.56
W Variable(1) N/A
____________
(1) Calculated as provided in the definition of "Uncertificated REMIC I Pass Through Rate".
REMIC II
As provided herein, the REMIC Administrator will elect to treat the segregated pool of assets consisting
of the REMIC I Regular Interests as a REMIC for federal income tax purposes, and such segregated pool of assets
will be designated as REMIC II. The Class R-II Certificates will represent ownership of the sole Class of
"residual interests" in REMIC II for purposes of the REMIC Provisions under federal income tax law. The Class
R-II Certificates will not bear interest or have a Certificate Principal Balance. The following table sets forth
the designation, type, Pass-Through Rate, aggregate Initial Certificate Principal Balance, Maturity Date, initial
ratings and certain features for each Class of Certificates that evidence "regular interests" in REMIC II and
REMIC II Regular Interests SB-IO and SB-PO (the "REMIC II Regular Interests") and Class P Certificates. 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. REMIC II Regular Interests
SB-IO and SB-PO will not be certificated.
AGGREGATE
INITIAL
CERTIFICATE
PASS-THROUGH PRINCIPAL MATURITY S&P/ MINIMUM
DESIGNATION RATE BALANCE FEATURES DATE XXXXX'X DENOMINATIONS
Class A-1 Adjustable $492,055,000.00 Senior/Super December 25, AAA/Aaa $100,000.00
Rate(1)(2) Senior/Adjustable Rate 2046
Class A-2 Adjustable $205,022,000.00 Senior/Super December 25, AAA/Aaa $100,000.00
Rate(1)(2) Senior/Senior 2046
Support/Adjustable Rate
Class A-3 Adjustable $123,013,000.00 Senior/Senior December 25, AAA/Aaa $100,000.00
Rate(1)(2) Support/Adjustable Rate 2046
Class M-1 Adjustable $18,455,000.00 Mezzanine/Adjustable December 25, AA+/Aaa $100,000.00
Rate(1)(2) Rate 2046
Class M-2 Adjustable $15,753,000.00 Mezzanine/Adjustable December 25, AA/Aa1 $100,000.00
Rate(1)(2) Rate 2046
Class M-3 Adjustable $4,501,000.00 Mezzanine/Adjustable December 25, AA-/Aa2 $100,000.00
Rate(1)(2) Rate 2046
Class M-4 Adjustable $8,552,000.00 Mezzanine/Adjustable December 25, A+/Aa3 $250,000.00
Rate(1)(2) Rate 2046
Class M-5 Adjustable $4,501,000.00 Mezzanine/Adjustable December 25, A/A1 $250,000.00
Rate(1)(2) Rate 2046
Class M-6 Adjustable $4,502,000.00 Mezzanine/Adjustable December 25, A-/A2 $250,000.00
Rate(1)(2) Rate 2046
Class M-7 Adjustable $4,501,000.00 Mezzanine/Adjustable December 25, BBB+/A3 $250,000.00
Rate(1)(2) Rate 2046
Class M-8 Adjustable $4,501,000.00 Mezzanine/Adjustable December 25, BBB/Baa1 $250,000.00
Rate(1)(2) Rate 2046
Class M-9 Adjustable $4,501,000.00 Mezzanine/Adjustable December 25, BBB-/Baa3 $250,000.00
Rate(1)(2) Rate 2046
Class B Adjustable $5,851,000.00 Subordinate/Adjustable December 25, BB/NR $250,000.00
Rate(1)(2) Rate 2046
SB-IO(3) (3) N/A Subordinate/Interest December 25, N/R N/A
Only 2046
SB-PO(4) N/A $4,501,560.83 Subordinate/Principal December 25, N/R N/A
Only 2046
Class P (5) N/A N/A Prepayment Charge December 25, N/R N/A
2046
(1) The REMIC III Regular Interests, ownership of which is represented by 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 Rate Cap.
(2) The Class A Certificates and Class M Certificates will also entitle their holders to receive certain
payments from the Holder of the Class SB Certificates from amounts to which the Holder of the Class SB
Certificates is entitled, which will not be a part of their ownership of the related REMIC III Regular Interests.
(3) REMIC II 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.
(4) REMIC II 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 an aggregate amount equal to the
initial Overcollateralization Amount pursuant to the terms and conditions hereof.
(5) The Class P Certificates will not represent ownership of an interest in any REMIC.
REMIC III
As provided herein, the REMIC Administrator will elect to treat the segregated pool of assets consisting
of REMIC II Regular Interests SB-IO and SB-PO as a REMIC for federal income tax purposes, and such segregated
pool of assets will be designated as REMIC III. The Class R-X Certificates will represent ownership of the sole
Class of "residual interests" in REMIC III 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
sets forth the designation, Pass-Through Rate and Initial Certificate Principal Balance for the Class SB
Certificates which evidence the single "regular interests" in REMIC III (the "REMIC III Regular Interest"). The
"latest possible maturity date" (determined solely for purposes of satisfying Treasury Regulation Section
1.860G-1(a)(4)(iii)) for the REMIC III Regular Interest shall be the Maturity Date.
AGGREGATE INITIAL
CERTIFICATE PRINCIPAL
DESIGNATION PASS-THROUGH RATE BALANCE
Class S-B Variable Rate(1) $4,501,560.83
(1) The Class SB Certificates will accrue interest as described in the definition of Accrued Certificate
Interest. The Class SB Certificates will not accrue interest on their Certificate Principal Balance. The REMIC
III Regular Interest will not have a Pass-Through Rate, but will be entitled to 100% of all amounts paid or
deemed paid on REMIC II Regular Interests SB-IO and SB-PO.
The Mortgage Loans have an aggregate Cut-off Date Principal Balance equal to $900,209,560.83.
The Mortgage Loans are payment-option adjustable-rate first lien mortgage loans with a negative
amortization feature having terms to maturity at origination or modification of generally not more than 40
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, Class M
and Class B 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, Class M and Class B 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, Class M and Class B 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 X-0, Xxxxx X-0, Class M or Class B
Certificates for any Distribution Date shall further be reduced by the interest portion of Realized Losses not
covered by Excess Cash Flow or the Overcollateralization Amount allocated to the Class A-2 Certificates or Class
A-3 Certificates or any Class of Class M Certificates or Class B Certificates pursuant to Section 4.05.
Accrued Certificate Interest with respect to the Class A, Class M and Class B 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 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.
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) the Coupon Strip, if any, for that
Distribution Date from interest collections on the Mortgage Loans.
Available Funds Rate: With respect to any Distribution Date, a per annum rate equal to (i) the product
of (x) the Interest Remittance Amount plus full and partial Principal Prepayments available to be distributed on
such Distribution Date and (y) a fraction, the numerator of which is 12 and the denominator of which is the
aggregate Stated Principal Balance of the Mortgage Loans as of such Distribution Date, adjusted to an actual/360
rate.
Basis Risk Shortfall: With respect to the Class A, Class M or Class B Certificates and any Distribution
Date, the sum of (a) an amount equal to the excess, if any, of (x) Accrued Certificate Interest for such Class of
Certificates calculated at a per annum rate equal to LIBOR plus the related Margin for such Distribution Date,
over (y) Accrued Certificate Interest for such Class calculated assuming the Net Rate Cap was equal to the Net
WAC Cap Rate for such Distribution Date, (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 LIBOR plus the related Margin
for the current Distribution Date.
Basis Risk Shortfall Reserve Fund: The reserve fund created pursuant to Section 4.09.
Basis Risk Shortfall Reserve Fund Amount: $289,435.
Book-Entry Certificate: The Class A, Class M, Class B, Class SB and Class P Certificates.
Capitalization Reimbursement Amount: As to any Distribution Date, the amount of Advances or Servicing
Advances that were added to the Stated Principal Balance of the Mortgage Loans 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: As to any Distribution Date, the amount, if any, by
which the amount of Advances or Servicing Advances that were added to the Stated Principal Balance of the
Mortgage Loans during the preceding calendar month exceeds the amount of principal payments on the Mortgage Loans
included in the Available Distribution Amount for that Distribution Date.
Certificate: Any Class A, Class M, Class B, Class SB, Class P 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-QO10" and which must be an Eligible Account.
Certificate Policy: None.
Certificate Principal Balance: With respect to any Class A, Class M or Class B 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 the Class A-2 Certificates and Class A-3
Certificates and any Class of Class M Certificates and Class B 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, Class A-3, Class M-1, Class
M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class M-9 and Class B Certificates, in
that order, will be increased to the extent of Realized Losses previously allocated thereto and remaining
unreimbursed, but only to the extent of Subsequent Recoveries received during the preceding calendar month. With
respect to each Class SB Certificate, on any date of determination, an amount equal to the Percentage Interest
evidenced by such Certificate, multiplied by an amount equal to (i) the excess, if any, of (A) the then aggregate
Stated Principal Balance of the Mortgage Loans over (B) the then aggregate Certificate Principal Balance of the
Class A, Class M and Class B Certificates then outstanding, which represents the sum of (i) the Initial Principal
Balance of the REMIC II Regular Interest SB-PO, as reduced by Realized Losses allocated thereto and payments
deemed made thereon, and (ii) accrued and unpaid interest on the REMIC II Regular Interest SB-IO, as reduced by
Realized Losses allocated thereto. The Class R Certificates will not have a Certificate Principal Balance.
Class A Certificate: Any one of the Class A-1, Class A-2 or Class A-3 Certificates, executed by the
Trustee and authenticated by the Certificate Registrar substantially in the form annexed to the Standard Terms as
Exhibit A, senior to the Class M, Class B, 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 II for purposes of the REMIC Provisions and (ii) the right to receive Basis Risk
Shortfalls and amounts payable from the Final Maturity Reserve Account.
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, 0.160% per annum, and on any Distribution Date on or after the second
Distribution Date after the first possible Optional Termination Date, 0.320% 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, 0.200% per annum, and on any Distribution Date on or after the second
Distribution Date after the first possible Optional Termination Date, 0.400% per annum.
Class A-3 Certificate: The Class A-3 Certificates, executed by the Trustee and authenticated by the
Certificate Registrar substantially in the form annexed to the Standard Terms as Exhibit A.
Class A-3 Margin: With respect to any Distribution Date prior to the second Distribution Date after the
first possible Optional Termination Date, 0.240% 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 A-P Certificates: None.
Class B Certificate: The Class B Certificates, executed by the Trustee and authenticated by the
Certificate Registrar substantially in the form annexed to the Standard Terms as Exhibit C, senior to the Class
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 II for
purposes of the REMIC Provisions and (ii) the right to receive Basis Risk Shortfalls and amounts payable from the
Final Maturity Reserve Account.
Class B Margin: With respect to any Distribution Date prior to the second Distribution Date after the
first possible Optional Termination Date, 1.500% per annum, and on any Distribution Date on or after the second
Distribution Date after the first possible Optional Termination Date, 2.250% per annum.
Class B 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, Class M-5 Principal Distribution Amount, Class M-6
Principal Distribution Amount, Class M-7 Principal Distribution Amount, Class M-8 Principal Distribution Amount
and Class M-9 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, Class M-3 Principal Distribution Amount, Class M-4 Principal Distribution Amount, Class M-5
Principal Distribution Amount, Class M-6 Principal Distribution Amount, Class M-7 Principal Distribution Amount,
Class M-8 Principal Distribution Amount and Class M-9 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, Class M 5, Class M-6, Class M-7, Class M-8 and Class M-9
Certificates (after taking into account the payment 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, Class M-5 Principal Distribution Amount, Class M-6 Principal
Distribution Amount, Class M-7 Principal Distribution Amount, Class M-8 Principal Distribution Amount and
Class M-9 Principal Distribution Amount for that Distribution Date) and (2) the Certificate Principal Balance of
the Class B 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 Certificates: Collectively, the Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class
M-6, Class M-7, Class M-8 and Class M-9 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 M-7, Class M-8, Class M-9, 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 and (ii) the right to receive Basis Risk Shortfalls and amounts payable from the Final Maturity
Reserve Account.
Class M-1 Margin: With respect to any Distribution Date prior to the second Distribution Date after the
first possible Optional Termination Date, 0.360% per annum, and on any Distribution Date on or after the second
Distribution Date after the first possible Optional Termination Date, 0.540% per annum.
Class 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 M-7, Class M-8, Class M-9, 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 and (ii) the
right to receive Basis Risk Shortfalls and amounts payable from the Final Maturity Reserve Account.
Class M-2 Margin: With respect to any Distribution Date prior to the second Distribution Date after the
first possible Optional Termination Date, 0.370% per annum, and on any Distribution Date on or after the second
Distribution Date after the first possible Optional Termination Date, 0.555% 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 M-7, Class M-8, Class M-9, 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 and (ii) the
right to receive Basis Risk Shortfalls and amounts payable from the Final Maturity Reserve Account.
Class M-3 Margin: With respect to any Distribution Date prior to the second Distribution Date after the
first possible Optional Termination Date, 0.380% per annum, and on any Distribution Date on or after the second
Distribution Date after the first possible Optional Termination Date, 0.570% 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 M-7, Class M-8, Class M-9, 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 and (ii) the
right to receive Basis Risk Shortfalls and amounts payable from the Final Maturity Reserve Account.
Class M-4 Margin: With respect to any Distribution Date prior to the second Distribution Date after the
first possible Optional Termination Date, 0.490% per annum, and on any Distribution Date on or after the second
Distribution Date after the first possible Optional Termination Date, 0.735% 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 M-7, Class M-8, Class M-9, 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 and (ii) the right to
receive Basis Risk Shortfalls and amounts payable from the Final Maturity Reserve Account.
Class M-5 Margin: With respect to any Distribution Date prior to the second Distribution Date after the
first possible Optional Termination Date, 0.530% per annum, and on any Distribution Date on or after the second
Distribution Date after the first possible Optional Termination Date, 0.795% per annum.
Class 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 M-7, Class M-8, Class M-9, 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 and (ii) the right to receive Basis Risk
Shortfalls and amounts payable from the Final Maturity Reserve Account.
Class M-6 Margin: With respect to any Distribution Date prior to the second Distribution Date after the
first possible Optional Termination Date, 0.580% per annum, and on any Distribution Date on or after the second
Distribution Date after the first possible Optional Termination Date, 0.870% 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 M-7 Certificate: Any one of the Class M-7 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-8, Class M-9, 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 and (ii) the right to receive Basis Risk
Shortfalls and amounts payable from the Final Maturity Reserve Account.
Class M-7 Margin: With respect to any Distribution Date prior to the second Distribution Date after the
first possible Optional Termination Date, 1.150% per annum, and on any Distribution Date on or after the second
Distribution Date after the first possible Optional Termination Date, 1.725% per annum.
Class M-7 Principal Distribution Amount: With respect to any Distribution Date (i) prior to the
Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect for that Distribution Date, the
remaining 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, Class M-5 Principal Distribution Amount
and Class M-6 Principal Distribution Amount or (ii) on or after the Stepdown Date if a Trigger Event is not in
effect for that Distribution Date, the lesser of:
(i) the remaining 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, Class M-5
Principal Distribution Amount and Class M-6 Principal Distribution Amount; and
(ii) the excess, if any, of (A) the sum of (1) the aggregate Certificate Principal Balance of the
Class A, Class M-1, Class M-2, Class M-3, Class M-4, Class M 5 and Class M-6 Certificates (after taking into
account the payment 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, Class M-5 Principal Distribution Amount and Class M-6 Principal Distribution Amount for that Distribution
Date) and (2) the Certificate Principal Balance of the Class M-7 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-8 Certificate: Any one of the Class M-8 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-9, 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 and (ii) the right to receive Basis Risk Shortfalls and amounts
payable from the Final Maturity Reserve Account.
Class M-8 Margin: With respect to any Distribution Date prior to the second Distribution Date after the
first possible Optional Termination Date, 1.500% per annum, and on any Distribution Date on or after the second
Distribution Date after the first possible Optional Termination Date, 2.250% per annum.
Class M-8 Principal Distribution Amount: With respect to any Distribution Date (i) prior to the
Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect for that Distribution Date, the
remaining 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, Class M-5 Principal Distribution Amount,
Class M-6 Principal Distribution Amount and Class M-7 Principal Distribution Amount or (ii) on or after the
Stepdown Date if a Trigger Event is not in effect for that Distribution Date, the lesser of:
(i) the remaining 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, Class M-5
Principal Distribution Amount, Class M-6 Principal Distribution Amount and Class M-7 Principal Distribution
Amount; and
(ii) the excess, if any, of (A) the sum of (1) the aggregate Certificate Principal Balance of the
Class A, Class M-1, Class M-2, Class M-3, Class M-4, Class M 5, Class M-6 and Class M-7 Certificates (after
taking into account the payment 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, Class M-5 Principal Distribution Amount, Class M-6 Principal Distribution Amount and
Class M-7 Principal Distribution Amount for that Distribution Date) and (2) the Certificate Principal Balance of
the Class M-8 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-9 Certificate: Any one of the Class M-9 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 and (ii) the right to receive Basis Risk Shortfalls and amounts payable
from the Final Maturity Reserve Account.
Class M-9 Margin: With respect to any Distribution Date prior to the second Distribution Date after the
first possible Optional Termination Date, 1.500% per annum, and on any Distribution Date on or after the second
Distribution Date after the first possible Optional Termination Date, 2.250% per annum.
Class M-9 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, Class M-5 Principal Distribution Amount,
Class M-6 Principal Distribution Amount, Class M-7 Principal Distribution Amount and Class M-8 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, Class M-3 Principal Distribution Amount, Class M-4 Principal Distribution Amount, Class M-5
Principal Distribution Amount, Class M-6 Principal Distribution Amount, Class M-7 Principal Distribution Amount
and Class M-8 Principal Distribution Amount; and
(ii) the excess, if any, of (A) the sum of (1) the aggregate Certificate Principal Balance of the
Class A, Class M-1, Class M-2, Class M-3, Class M-4, Class M 5, Class M-6, Class M-7 and Class M-8 Certificates
(after taking into account the payment 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, Class M-5 Principal Distribution Amount, Class M-6 Principal Distribution Amount,
Class M-7 Principal Distribution Amount and Class M-8 Principal Distribution Amount for that Distribution Date)
and (2) the Certificate Principal Balance of the Class M-9 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 P Certificate: Any one of the Class P Certificates executed by the Trustee and authenticated by
the Certificate Registrar substantially in the form annexed to the Standard Terms as Exhibit C-I.
Class R Certificate: Any one of the Class R-I, Class R-II or Class R-X Certificates.
Class R-I Certificate: Any one of the Class R-I Certificates executed by the Trustee and authenticated
by the Certificate Registrar substantially in the form annexed to the Standard Terms as Exhibit D and evidencing
an interest designated as a "residual interest" in REMIC I for purposes of the REMIC Provisions.
Class R-II Certificate: Any one of the Class R-II Certificates executed by the Trustee and
authenticated by the Certificate Registrar substantially in the form annexed to the Standard Terms as Exhibit D
and evidencing an interest designated as a "residual interest" in REMIC II for purposes of the REMIC Provisions.
Class 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
an interest designated as a "residual interest" in REMIC III 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 an interest designated as the "regular interest"
in REMIC III for purposes of the REMIC Provisions, together with certain obligations with respect to payments of
Basis Risk Shortfall amounts and rights with respect to the Final Maturity Reserve Account.
Clearstream: Clearstream Banking, societe anonyme.
Closing Date: December 28, 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-QO10.
Coupon Strip: On each Distribution Date on or after the Distribution Date in January 2017, through and
including the Distribution Date in December 2036, an amount equal to the greater of (I) the product of (i)
one-twelfth of 0.9712% and (ii) the aggregate Stated Principal Balance of the Mortgage Loans with original terms
to maturity in excess of 30 years, and (II) the product of (i) one-twelfth of 1.00% and (ii) either (A) the
aggregate Stated Principal Balance of the Mortgage Loans with original terms to maturity in excess of 30 years if
such aggregate Stated Principal Balance is greater than the scheduled amount set forth in column A of Schedule 1
hereto for the related Distribution Date or (B) zero, if the aggregate Stated Principal Balance of the Mortgage
Loans with original terms to maturity in excess of 30 years is less than or equal to the scheduled amount set
forth in column A of Schedule 1 hereto for the related Distribution Date.
Coupon Strip Rate: A per annum rate equal to the product of (i) the Coupon Strip, if any, payable to the
Final Maturity Reserve Account on any Distribution Date and (ii) twelve, divided by the aggregate Stated
Principal Balance of the Mortgage Loans as of such Distribution Date.
Cut-off Date Balance: $900,209,560.83.
Cut-off Date: December 1, 2006.
Deferred Interest: The amount of interest which is deferred and added to the principal balance of a
Mortgage Loan due to negative amortization. For purposes of REMIC I, Deferred Interest shall be allocated to
REMIC I Regular Interest LT1 in reduction of the portion of the Uncertificated Accrued Interest thereon
distributable on the related Distribution Date and shall result in an increase in the principal balance thereof
to the extent of such reduction.
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.
Euroclear: Euroclear Bank, S.A./N.A., as operator of The Euroclear System.
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, Class M and Class B 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,
Class M and Class B Certificates on such Distribution Date and (B) the Overcollateralization Reduction Amount, if
any, for that Distribution Date.
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.
Final Maturity Reserve Account: The separate account established and maintained by the Supplemental
Interest Trust Trustee pursuant to Section 4.10 hereof for the distribution of the Coupon Strip. Amounts on
deposit in the Final Maturity Reserve Account will not be an asset of any REMIC.
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 January 2007, the period
commencing on the Closing Date and ending on the day immediately preceding the Distribution Date in January 2007,
and with respect to any Distribution Date after the Distribution Date in January 2007, 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 Carryforward Amount: With respect to any Class of Class A, Class M and Class B Certificates
and any Distribution Date, the sum of (a) on any Distribution Date on which the Pass-Through Rate is equal to the
Available Funds Rate, the excess, if any, of (i) Accrued Certificate Interest for such Class assuming the Net
Rate Cap was equal to the Net WAC Cap Rate for such Distribution Date over (ii) Accrued Certificate Interest
calculated based on such Available Funds Rate and (b) interest on the amount calculated pursuant to clause (a)
for any prior Distribution Date that remains unreimbursed at a rate equal to the lesser of (x) One-Month LIBOR
plus the related Margin and (y) the Net WAC Cap Rate for 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.
Interest Remittance Amount: With respect to any Distribution Date, the portion of the Available
Distribution Amount for such Distribution Date attributable to interest received or advanced with respect to the
Mortgage Loans, net of the Expense Fee Rate.
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, Class M and Class B 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-1 Margin, Class A-2 Margin, Class A-3 Margin, Class M-1 Margin, Class M-2 Margin,
Class M-3 Margin, Class M-4 Margin, Class M-5 Margin, Class M-6 Margin, Class M-7 Margin, Class M-8 Margin, Class
M-9 Margin or Class B Margin, as applicable.
Marker Rate: With respect to the Class SB Certificates or REMIC II Regular Interest SB-IO and any
Distribution Date, a per annum rate equal to two (2) times the weighted average of the Uncertificated REMIC I
Pass-Through Rates for REMIC I Regular Interest LT2 and REMIC I Regular Interest LT3.
Maturity Date: December 25, 2046, the Distribution Date in the month of the latest scheduled maturity
date of any Mortgage Loan.
Maximum Coupon Strip: An amount equal to the product of (i) one-twelfth of 1.00% and (ii) the aggregate
Stated Principal Balance of the Mortgage Loans with original terms to maturity in excess of 30 years.
Maximum Coupon Strip Rate: With respect to any Distribution Date, a per annum rate equal to (i) if a
Coupon Strip is payable to the Final Maturity Reserve Account on such Distribution Date, the Coupon Strip Rate
calculated as if the Coupon Strip were equal to the Maximum Coupon Strip or (ii) otherwise, 0.00%.
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.
Modified Net WAC Cap Rate: With respect to any Distribution Date, the Net WAC Cap Rate modified by
replacing the term "Coupon Strip Rate" with the term "Maximum Coupon Strip Rate" wherever it appears in the
definition of "Net WAC Cap 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 Rate Cap: With respect to any Class of Class A, Class M and Class B Certificates and any
Distribution Date, the lesser of (i) the Net WAC Cap Rate and (ii) the Available Funds Rate.
Net WAC Cap Rate: With respect to any Distribution Date, a per annum rate (which will not be less than
zero) equal to the weighted average of the Net Mortgage Rates of the Mortgage Loans using the Net Mortgage Rates
in effect on such Mortgage Loans during the related Due Period less the Coupon Strip Rate, if applicable,
multiplied by a fraction, expressed as a percentage, the numerator of which is 30 and the denominator of which is
the actual number of days in the related Interest Accrual Period for such Certificates.
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 the Class SB Certificates or REMIC II Regular Interest SB-IO,
immediately prior to any Distribution Date is equal to the aggregate of the Uncertificated Principal Balances of
the REMIC I Regular Interests.
Offered Certificates: The Class A Certificates and the Class M Certificates.
Optional Termination Date: Any Distribution Date on or after which the aggregate Stated Principal
Balance (after giving effect to distributions to be made on such Distribution Date) of the Mortgage Loans is less
than 10.00% of the Cut-off Date Balance.
Overcollateralization Amount: With respect to any Distribution Date, the excess, if any, of (a) the
aggregate Stated Principal Balance of the Mortgage Loans before giving effect to distributions of principal to be
made on such Distribution Date over (b) the aggregate Certificate Principal Balance of the Class A, Class M and
Class B Certificates before taking into account distributions of principal to be made on such Distribution 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 each class of Certificates (other than the Class SB, the Class P and
the Class R Certificates), and any Distribution Date, a per annum rate equal to the lesser of (i) LIBOR plus the
related Margin for such Distribution Date and (ii) the Net Rate Cap for such Distribution Date.
With respect to the Class SB Certificates or REMIC II Regular Interest SB-IO and any Distribution Date,
a rate per annum equal to the sum of (a) the Maximum Coupon Strip Rate and (b) 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 I Regular Interests. For
purposes of calculating the Pass-Through Rate for the Class SB Certificates or the REMIC II Regular Interest
SB-IO, the numerator is equal to the sum of the following components:
(i) the Uncertificated REMIC I Pass-Through Rate for REMIC I Regular Interest LT1 minus the Marker
Rate, applied to a notional amount equal to the Uncertificated Principal Balance of REMIC I Regular Interest LT1;
(ii) the Uncertificated REMIC I Pass-Through Rate for REMIC I Regular Interest LT2 minus the Marker
Rate, applied to a notional amount equal to the Uncertificated Principal Balance of REMIC I Regular Interest LT2;
and
(iii) the Uncertificated REMIC I Pass-Through Rate for REMIC I Regular Interest LT4 minus twice the
Marker Rate, applied to a notional amount equal to the Uncertificated Principal Balance of REMIC I Regular
Interest LT4.
Permanent Regulation S Global Offered Certificate: Any one of the Class B, Class SB and Class P
Certificates substantially in the form of Exhibit Nine-B hereto, and as more fully described in Section 5.02(i)
hereof.
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 25% 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 P 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 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, except to the extent applied to offset
Deferred Interest, 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, Class M and Class B 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.
Regulation S Purchaser: An entity that is not a U.S. Person within the meaning of Regulation S under
the 1933 Act.
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 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, if any, and
(v) all proceeds of clauses (i) through (iv) above.
Notwithstanding the foregoing, the REMIC election with respect to REMIC I specifically excludes the
Basis Risk Shortfall Reserve Fund.
REMIC I Distribution Amount: For any Distribution Date, the Available Distribution Amount shall be
distributed to the REMIC I Regular Interests and the Class R-I Certificates in the following amounts and priority:
(i) to the extent of the Available Distribution Amount, to REMIC II as the holder of REMIC
I Regular Interests LT1, LT2, LT3 and LT4, pro rata, in an amount equal to (A) their Uncertificated Accrued
Interest for such Distribution Date, plus (B) any amounts in respect thereof remaining unpaid from previous
Distribution Dates, in the case of REMIC I Regular Interest LT1 each such amount having first been reduced by any
Deferred Interest for the related Distribution Date; and
(ii) to the extent of the Available Distribution Amount remaining after the distributions
made pursuant to clause (i) above, to REMIC II as the holder of the REMIC I Regular Interests, in an amount equal
to:
(A) in respect of REMIC I Regular Interests LT2, LT3 and LT4, their respective
Principal Distribution Amounts;
(B) in respect of REMIC I Regular Interest LT1 any remainder until the
Uncertificated Principal Balance thereof is reduced to zero;
(C) any remainder in respect of REMIC I Regular Interests LT2, LT3 and LT4, pro
rata according to their respective Uncertificated Principal Balances as reduced by the distributions deemed made
pursuant to (A) above, until their respective Uncertificated Principal Balances are reduced to zero; and
(iii) any remaining amounts to the Holders of the Class R-I Certificates.
REMIC I Principal Reduction Amounts: For any Distribution Date, the amounts by which the principal
balances of REMIC I 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 aggregate principal balance of REMIC I Regular Interest LT1 after distributions on the
prior Distribution Date.
Y2 = the principal balance of REMIC I Regular Interest LT2 after distributions on the prior
Distribution Date.
Y3 = the principal balance of REMIC I Regular Interest LT3 after distributions on the prior
Distribution Date.
Y4 = the principal balance of REMIC I Regular Interest LT4 after distributions on the prior
Distribution Date (note: Y3 = Y4).
AY1 = the REMIC I Regular Interest LT1 Principal Reduction Amount.
AY2 = the REMIC I Regular Interest LT2 Principal Reduction Amount.
AY3 = the REMIC I Regular Interest LT3 Principal Reduction Amount.
AY4 = the REMIC I Regular Interest LT4 Principal Reduction Amount.
P0 = the aggregate principal balance of REMIC I 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 REMIC I Regular Interests LT1, LT2, LT3 and LT4 after
distributions and the allocation of Realized Losses to be made on such Distribution Date.
AP = P0 - P1 = the aggregate of REMIC I 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 Modified Net WAC Cap Rate (stated as a monthly rate) after giving effect to amounts
distributed and Realized Losses allocated on the prior Distribution Date.
R1 = the Modified Net WAC Cap Rate (stated as a monthly rate) after giving effect to amounts to be
distributed and Realized Losses to be allocated on such Distribution Date.
a = (Y2 + Y3)/P0. The initial value of a on the Closing Date for use on the first Distribution
Date shall be 0.0001.
a0 = the lesser of (A) the sum for all Classes of Certificates, other than the Class SB
Certificates, of the product for each Class of (i) the monthly interest rate (as limited by the Modified Net WAC
Cap 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.
a1 = the lesser of (A) the sum for all Classes of Certificates, other than the Class SB
Certificates, of the product for each Class of (i) the monthly interest rate (as limited by the Modified Net WAC
Cap 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:
AY1 = AP - AY2 - AY3 - AY4;
AY2 = (a/2){( a0R1 - a1R0)/R0R1};
AY3 = aAP - AY2; and
AY4 = AY3
if both AY2 and AY3, as so determined, are non-negative numbers. Otherwise:
(1) If AY2, as so determined, is negative, then
AY2 = 0;
AY3 = a{a1R0P0 - a0R1P1}/{a1R0};
AY4 = AY3; and
AY1 = XX - XX0 - XX0 - XX0.
(2) If AY3, as so determined, is negative, then
AY3 = 0;
AY2 = a{a1R0P0 - a0R1P1}/{2R1R0P1 - a1R0};
AY4 = AY3; and
AY1 = XX - XX0 - XX0 - XX0.
REMIC I Realized Losses: Realized Losses on the Mortgage Loans shall be allocated to the REMIC I
Regular Interests as follows: The interest portion of Realized Losses on the Mortgage Loans, if any, shall be
allocated among REMIC I 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 on the Mortgage Loans, if any, shall be allocated first, to REMIC I Regular Interests
LT2, LT3 and LT4 pro rata according to their respective Principal Reduction Amounts to the extent thereof in
reduction of the Uncertificated Principal Balance of such REMIC I Regular Interests and, second, the remainder,
if any, of such principal portion of such Realized Losses shall be allocated to REMIC I Regular Interest LT1 in
reduction of the Uncertificated Principal Balance thereof.
REMIC I Regular Interests: REMIC I Regular Interests LT1, LT2, LT3 and LT4.
REMIC I Regular Interest LT1: 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 I Regular Interest LT1 Principal Distribution Amount: For any Distribution Date, the excess, if
any, of the REMIC I Regular Interest LT1 Principal Reduction Amount for such Distribution Date over the Realized
Losses allocated to the REMIC I Regular Interest LT1 on such Distribution Date.
REMIC I Regular Interest LT2: 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 I Regular Interest LT2 Principal Distribution Amount: For any Distribution Date, the excess, if
any, of the REMIC I Regular Interest LT2 Principal Reduction Amount for such Distribution Date over the Realized
Losses allocated to the REMIC I Regular Interest LT2 on such Distribution Date.
REMIC I Regular Interest LT3: 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 I Regular Interest LT3 Principal Distribution Amount: For any Distribution Date, the excess, if
any, of the REMIC I Regular Interest LT3 Principal Reduction Amount for such Distribution Date over the Realized
Losses allocated to the REMIC I Regular Interest LT3 on such Distribution Date.
REMIC I Regular Interest LT4: 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 I Regular Interest LT4 Principal Distribution Amount: For any Distribution Date, the excess, if
any, of the REMIC I Regular Interest LT4 Principal Reduction Amount for such Distribution Date over the Realized
Losses allocated to the REMIC I Regular Interest LT4 on such Distribution Date.
REMIC I Regular Interest W: 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. The REMIC election with respect to REMIC II specifically excludes
the Basis Risk Shortfall Reserve Fund.
REMIC II Regular Interest: Any one of REMIC II Regular Interest A-1, REMIC II Regular Interest A-2,
REMIC II Regular Interest A-3, REMIC II Regular Interest M-1, REMIC II Regular Interest M-2, REMIC II Regular
Interest M-3, REMIC II Regular Interest M-4, REMIC II Regular Interest M-5, REMIC II Regular Interest M-6, REMIC
II Regular Interest M-7, REMIC II Regular Interest M-8, REMIC II Regular Interest M-9, REMIC II Regular Interest
SB-IO or REMIC II Regular Interest SB-PO.
REMIC II Regular Interest A-1: A regular interest in REMIC II which has a principal balance equal to
the principal balance of the Class A-1 Certificates and which is entitled to interest at a rate equal to the
lesser of (i) LIBOR plus the Class A-1 Margin and (ii) the Modified Net WAC Cap Rate. Interest accrued in any
Interest Accrual Period and not paid on the related Distribution Date shall carry forward to each succeeding
Distribution Date without interest until paid.
REMIC II Regular Interest A-2: A regular interest in REMIC II which is has a principal balance equal to
the principal balance of the Class A-2 Certificates and which is entitled to interest at a rate equal to the
lesser of (i) LIBOR plus the Class A-2 Margin and (ii) the Modified Net WAC Cap Rate. Interest accrued in any
Interest Accrual Period and not paid on the related Distribution Date shall carry forward to each succeeding
Distribution Date without interest until paid.
REMIC II Regular Interest A-3: A regular interest in REMIC II which is has a principal balance equal to
the principal balance of the Class A-3 Certificates and which is entitled to interest at a rate equal to the
lesser of (i) LIBOR plus the Class A-3 Margin and (ii) the Modified Net WAC Cap Rate. Interest accrued in any
Interest Accrual Period and not paid on the related Distribution Date shall carry forward to each succeeding
Distribution Date without interest until paid.
REMIC II Regular Interest M-1: A regular interest in REMIC II which is has a principal balance equal to
the principal balance of the Class M-1 Certificates and which is entitled to interest at a rate equal to the
lesser of (i) LIBOR plus the Class M-1 Margin and (ii) the Modified Net WAC Cap Rate. Interest accrued in any
Interest Accrual Period and not paid on the related Distribution Date shall carry forward to each succeeding
Distribution Date without interest until paid.
REMIC II Regular Interest M-2: A regular interest in REMIC II which is has a principal balance equal to
the principal balance of the Class M-2 Certificates and which is entitled to interest at a rate equal to the
lesser of (i) LIBOR plus the Class M-2 Margin and (ii) the Modified Net WAC Cap Rate. Interest accrued in any
Interest Accrual Period and not paid on the related Distribution Date shall carry forward to each succeeding
Distribution Date without interest until paid.
REMIC II Regular Interest M-3: A regular interest in REMIC II which is has a principal balance equal to
the principal balance of the Class M-3 Certificates and which is entitled to interest at a rate equal to the
lesser of (i) LIBOR plus the Class M-3 Margin and (ii) the Modified Net WAC Cap Rate. Interest accrued in any
Interest Accrual Period and not paid on the related Distribution Date shall carry forward to each succeeding
Distribution Date without interest until paid.
REMIC II Regular Interest M-4: A regular interest in REMIC II which is has a principal balance equal to
the principal balance of the Class M-4 Certificates and which is entitled to interest at a rate equal to the
lesser of (i) LIBOR plus the Class M-4 Margin and (ii) the Modified Net WAC Cap Rate. Interest accrued in any
Interest Accrual Period and not paid on the related Distribution Date shall carry forward to each succeeding
Distribution Date without interest until paid.
REMIC II Regular Interest M-5: A regular interest in REMIC II which is has a principal balance equal to
the principal balance of the Class M-5 Certificates and which is entitled to interest at a rate equal to the
lesser of (i) LIBOR plus the Class M-5 Margin and (ii) the Modified Net WAC Cap Rate. Interest accrued in any
Interest Accrual Period and not paid on the related Distribution Date shall carry forward to each succeeding
Distribution Date without interest until paid.
REMIC II Regular Interest M-6: A regular interest in REMIC II which is has a principal balance equal to
the principal balance of the Class M-6 Certificates and which is entitled to interest at a rate equal to the
lesser of (i) LIBOR plus the Class M-6 Margin and (ii) the Modified Net WAC Cap Rate. Interest accrued in any
Interest Accrual Period and not paid on the related Distribution Date shall carry forward to each succeeding
Distribution Date without interest until paid.
REMIC II Regular Interest M-7: A regular interest in REMIC II which is has a principal balance equal to
the principal balance of the Class M-7 Certificates and which is entitled to interest at a rate equal to the
lesser of (i) LIBOR plus the Class M-7 Margin and (ii) the Modified Net WAC Cap Rate. Interest accrued in any
Interest Accrual Period and not paid on the related Distribution Date shall carry forward to each succeeding
Distribution Date without interest until paid.
REMIC II Regular Interest M-8: A regular interest in REMIC II which is has a principal balance equal to
the principal balance of the Class M-8 Certificates and which is entitled to interest at a rate equal to the
lesser of (i) LIBOR plus the Class M-8 Margin and (ii) the Modified Net WAC Cap Rate. Interest accrued in any
Interest Accrual Period and not paid on the related Distribution Date shall carry forward to each succeeding
Distribution Date without interest until paid.
REMIC II Regular Interest M-9: A regular interest in REMIC II which is has a principal balance equal to
the principal balance of the Class M-9 Certificates and which is entitled to interest at a rate equal to the
lesser of (i) LIBOR plus the Class M-9 Margin and (ii) the Modified Net WAC Cap Rate. Interest accrued in any
Interest Accrual Period and not paid on the related Distribution Date shall carry forward to each succeeding
Distribution Date without interest until paid.
REMIC II Regular Interest SB-IO: A regular interest in REMIC II that has no initial principal, that
bears interest at the related Pass-Through Rate, and that has such other terms as are described herein.
REMIC II Regular Interest SB-PO: A regular interest in REMIC II that has an initial principal balance
equal to the initial principal balance for the Class SB Certificates, as set forth in the Preliminary Statement,
that bears no interest, 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 SB-IO and SB-PO.
REMIC III Regular Interest: The separate beneficial ownership interest in REMIC III issued hereunder
and designated as a "regular interest" in REMIC III, the ownership of which is evidenced by the Class SB
Certificates. The REMIC III Regular Interest will not have a Pass-Through Rate, but will be entitled to 100% of
all amounts distributed on REMIC II Regular Interests SB-IO and SB-PO.
Required Overcollateralization Amount: With respect to any Distribution Date (i) prior to the Stepdown
Date, an amount equal to 0.50% of the aggregate Stated Principal Balance of the Mortgage Loans as of the Cut-off
Date; (ii) on or after the Stepdown Date but prior to the Distribution Date in January 2013, provided a Trigger
Event is not in effect, the greater of (x) 1.25% 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; (iii) on or after the Stepdown Date and on or after the Distribution Date in January
2013, provided a Trigger Event is not in effect, the greater of (x) 1.00% 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; or (iv) 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.
Reserve Fund: The separate trust account created and maintained by the Trustee pursuant to Section 4.09
hereof.
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 B, Class SB and Class P Certificates
substantially in the form of Exhibit Nine-A hereto, and as more fully described in Section 5.02(i) hereof.
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 Class B
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 the applicable Due Date
preceding that Distribution Date, including Mortgage Loans in foreclosure, REO Properties and Mortgage Loans in
bankruptcy 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
and (c) any amount by which the Stated Principal Balance of the Mortgage Loan has been increased for Deferred
Interest pursuant to the terms of the related Mortgage Note on or prior to the Distribution Date, 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 (1) the Distribution Date immediately following the Distribution
Date on which the aggregate Certificate Principal Balance of the Class A Certificates has been reduced to zero
and (2) the later to occur of (x) the Distribution Date in January 2010 and (y) the first Distribution Date on
which the Senior Enhancement Percentage is greater than or equal to (a) on any Distribution Date prior to the
Distribution Date in January 2013, 22.25% and (b) on any Distribution Date on or after the Distribution Date in
January 2013, 17.80%.
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 (1) Percentage (2)
A 77.750% 82.200%
M-1 82.875% 86.300%
M-2 87.250% 89.800%
M-3 88.500% 90.800%
M-4 90.875% 92.700%
M-5 92.125% 93.700%
M-6 93.375% 94.700%
M-7 94.625% 95.700%
M-8 95.875% 96.700%
M-9 97.125% 97.700%
B 98.750% 99.000%
(1) For any Distribution Date prior to the Distribution Date in January 2013.
(2) For any Distribution Date in January 2013 or thereafter.
Supplemental Interest Trust: The separate trust formed pursuant to this Agreement and maintained by the
Supplemental Interest Trust Trustee, the assets of which consist of the Final Maturity Reserve Account. The
primary activities of the Supplemental Interest Trust created pursuant to this Agreement shall be:
(i) receiving collections in respect of the Mortgage Loans or making payments from the Final
Maturity Reserve Account; and
(ii) 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 New York banking
corporation, 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.
Temporary Regulation S Global Offered Certificate: Any one of the Class B, Class SB and Class P
Certificates substantially in the form of Exhibit Nine-C hereto, and as more fully described in Section 5.02(i)
hereof.
Trigger Event: A Trigger Event is in effect with respect to any Distribution Date if either (a) on or
after the Stepdown Date the Sixty-Plus Delinquency Percentage, as determined on that Distribution Date, exceeds
40.00% of the Senior Enhancement Percentage for that Distribution Date or (b) on or after the Distribution Date
in January 2009 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 January 2009 to December 2009: 0.200% with respect to January 2009, plus an additional 1/12th of 0.250%
for each month through December 2009.
o January 2010 to December 2010: 0.450% with respect to January 2010, plus an additional 1/12th of 0.350%
for each month through December 2010.
o January 2011 to December 2011: 0.800% with respect to January 2011, plus an additional 1/12th of 0.350%
for each month through December 2011.
o January 2012 to December 2012: 1.150% with respect to January 2012, plus an additional 1/12th of 0.450%
for each month through December 2012.
o January 2013 to December 2013: 1.600% with respect to January 2013, plus an additional 1/12th of 0.150%
for each month through December 2013.
o January 2014 and thereafter: 1.750%.
2006-QO10 REMIC: Any of REMIC I, REMIC II or REMIC III as the case may be.
Uncertificated Accrued Interest: With respect to any Uncertificated Regular Interest for any
Distribution Date, one month's interest at the related Uncertificated REMIC I Pass-Through Rate or Pass-Through
Rate, as applicable, for such Distribution Date, accrued on its Uncertificated Principal Balance or
Uncertificated Notional Amount, as applicable, immediately prior to such Distribution Date. Uncertificated
Accrued Interest for Uncertificated 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) relating to the Mortgage Loans for any Distribution Date shall be
allocated among REMIC I Regular Interests LT1, LT2, LT3 and LT4, pro rata, based on, and to the extent of,
Uncertificated Accrued Interest, as calculated without application of this sentence. Uncertificated Accrued
Interest on REMIC II Regular Interest SB-PO shall be zero. Uncertificated Accrued Interest on REMIC II Regular
Interest SB-IO for each Distribution Date shall equal Accrued Certificate Interest for the Class SB Certificates.
Uncertificated Notional Amount: With respect to REMIC II Regular Interest SB-IO, the Notional Amount
for such Class.
Uncertificated Principal Balance: The principal amount of any Uncertificated Regular Interest
outstanding as of any date of determination. The Uncertificated Principal Balance of each REMIC I Regular
Interest shall be reduced first by Realized Losses allocated thereto by the definition of REMIC I Realized
Losses, and by all distributions of principal deemed made on such REMIC I Regular Interest on such Distribution
Date. With respect to REMIC II 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. The Uncertificated Principal Balance of each
Uncertificated Regular Interest shall never be less than zero.
Uncertificated Regular Interests: The REMIC I Regular Interests and REMIC II Regular Interests SB-IO and
SB-PO.
Uncertificated REMIC I Pass-Through Rate: With respect to any Distribution Date and (i) REMIC I Regular
Interests LT1 and LT2, the Modified Net WAC Cap Rate, (ii) REMIC I Regular Interest LT3, zero (0.00%), (iii)
REMIC I Regular Interest LT4, twice the Modified Net WAC Cap Rate and (iv) REMIC I Regular Interest W, the
Maximum Coupon Strip Rate.
Underwriter: Xxxxxxx, Xxxxx & Co.
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.
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.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01. CONVEYANCE OF MORTGAGE LOANS. (See Section 2.01 of the Standard Terms.)
SECTION 2.02. ACCEPTANCE BY TRUSTEE. (See Section 2.02 of the Standard Terms.)
SECTION 2.03. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE MASTER SERVICER AND THE COMPANY.
(A) For representations, warranties and covenants of the Master Servicer, see Section 2.03(a) of the
Standard Terms.
(B) The Company hereby represents and warrants to the Trustee for the benefit of Certificateholders that as
of the Closing Date (or, if otherwise specified below, as of the date so specified):
(i) No Mortgage Loan is 30 or more days Delinquent in payment of principal and interest as of the Cut-off
Date and no Mortgage Loan has been so Delinquent more than once in the 12-month period prior to
the Cut-off Date;
(ii) The information set forth in Exhibit 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 payment-option adjustable-rate mortgage loans with a negative amortization
feature 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
40 years;
(iv) To the best of the Company's knowledge, 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 0.7% of the Mortgage Loans by aggregate Stated Principal Balance as of the Cut-off Date are
secured by Mortgaged Properties located in any one zip code area in New York, and no more than
0.7% of the Mortgage Loans by aggregate Stated Principal Balance as of the Cut-off Date are
secured by Mortgaged Properties located in any one zip code area outside New York;
(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 92.7% of the Mortgage Loans by aggregate Stated Principal Balance as of the Cut-off Date
were underwritten under a reduced loan documentation program, no more than 1.1% of the Mortgage
Loans by aggregate Stated Principal Balance as of the Cut-off Date were underwritten under a
no-stated income program, and no more than 0.2% of the Mortgage Loans by aggregate Stated
Principal Balance as of the Cut-off Date were underwritten under a no income/no asset program;
(x) Except with respect to no more than 9.2% of the Mortgage Loans by aggregate Stated Principal Balance as
of the Cut-off Date, the Mortgagor represented in its loan application with respect to the
related Mortgage Loan that the Mortgaged Property would be owner-occupied;
(xi) None of the Mortgage Loans is a Buy-Down Mortgage Loan;
(xii) Each Mortgage Loan constitutes a qualified mortgage under Section 860G(a)(3)(A) of the Code and Treasury
Regulation Section 1.860G-2(a)(1), (2), (4), (5), (6), (7) and (9) without reliance on the
provisions of Treasury Regulation Section 1.860G-2(a)(3) or Treasury Regulation Section
1.860G-2(f)(2) or any other provision that would allow a Mortgage Loan to be treated as a
"qualified mortgage" notwithstanding its failure to meet the requirements of Section
860G(a)(3)(A) of the Code and Treasury Regulation Section 1.860G-2(a)(1), (2), (4), (5), (6),
(7) and (9);
(xiii) A policy of title insurance was effective as of the closing of each Mortgage Loan and is valid and
binding and remains in full force and effect, unless the Mortgaged Properties are located in
the State of Iowa and an attorney's certificate has been provided as described in the Program
Guide;
(xiv) No Mortgage Loan is a Cooperative Loan;
(xv) With respect to each Mortgage Loan originated under a "streamlined" Mortgage Loan program (through which
no new or updated appraisals of Mortgaged Properties are obtained in connection with the
refinancing thereof), the related Seller has represented that either (a) the value of the
related Mortgaged Property as of the date the Mortgage Loan was originated was not less than
the appraised value of such property at the time of origination of the refinanced Mortgage Loan
or (b) the Loan-to-Value Ratio of the Mortgage Loan as of the date of origination of the
Mortgage Loan generally meets the Company's underwriting guidelines;
(xvi) Interest on each Mortgage Loan is calculated on the basis of a 360-day year consisting of twelve 30-day
months;
(xvii) None of the Mortgage Loans contain in the related Mortgage File a Destroyed Mortgage Note;
(xviii) Nine of the Mortgage Loans, representing no more than 0.2% of the Mortgage Loans by aggregate Stated
Principal Balance, 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 the 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 (the 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
REMIC I, REMIC II AND REMIC III.
The Trustee acknowledges the assignment to it of the Mortgage Loans and the delivery of the Custodial
Files to it, or the 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-I Certificates in authorized denominations which,
together with the REMIC I Regular Interests, evidence the beneficial interest in REMIC I, the Class R-II
Certificates in authorized denominations which, together with the REMIC II Regular Interests, evidence the
beneficial interest in REMIC II and the Class R-X Certificates in authorized denominations which, together with
the REMIC III Regular Interest, evidence the beneficial interest in REMIC III.
SECTION 2.06. CONVEYANCE OF UNCERTIFICATED 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 (i) the REMIC I Regular
Interests to the Trustee for the benefit of the Holders of each Class of Certificates (other than the Class R-I
Certificates) and (ii) REMIC II Regular Interests SB-PO and SB-IO to the Trustee for the benefit of the Holders
of the Class SB Certificates and Class R-X Certificates. The Trustee acknowledges receipt of the REMIC I 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-I Certificates). The Trustee
acknowledges receipt of REMIC II Regular Interests SB-PO and SB-IO 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 the Class SB Certificates
and the Class R-X Certificates. The rights of the Holders of each Class of Certificates (other than the Class
R-I Certificates) to receive distributions from the proceeds of REMIC II in respect of such Classes and the
rights of the Holders of the Class SB Certificates and Class R-X Certificates to receive distributions from the
proceeds of REMIC III in respect of such Classes, and all ownership interests of the Holders of such Classes in
such distributions, shall be as set forth in this Agreement.
SECTION 2.07. ISSUANCE OF CERTIFICATES EVIDENCING INTERESTS IN REMIC II AND REMIC III.
The Trustee acknowledges the assignment to it of the Uncertificated 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, Class R-I and Class R-X Certificates) in
authorized denominations, which, together with REMIC II Regular Interests SB-IO and SB-PO, evidence the
beneficial interests in the entire REMIC II and (ii) the Class SB and Class R-X Certificates which evidence the
beneficial interests in the entire REMIC III.
SECTION 2.08. PURPOSES AND POWERS OF THE TRUST. (See Section 2.08 of the Standard Terms.)
SECTION 2.09. AGREEMENT REGARDING ABILITY TO DISCLOSE.
The Company, the Master Servicer and the Trustee hereby agree, notwithstanding any other express or
implied agreement to the contrary, that any and all Persons, and any of their respective employees,
representatives, and other agents may disclose, immediately upon commencement of discussions, to any and all
Persons, without limitation of any kind, the tax treatment and tax structure of the transaction and all materials
of any kind (including opinions or other tax analyses) that are provided to any of them relating to such tax
treatment and tax structure. For purposes of this paragraph, the terms "tax treatment" and "tax structure" are
defined under Treasury 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) The Master Servicer shall establish and maintain a Custodial Account in which the Master
Servicer shall deposit or cause to be deposited on a daily basis, except as otherwise specifically provided
herein, the following payments and collections remitted by Subservicers or received by it in respect of the
Mortgage Loans subsequent to the Cut-off Date (other than in respect of principal and interest on the Mortgage
Loans due on or before the Cut-off Date):
(i) All payments on account of principal, including Principal Prepayments made by
Mortgagors on the Mortgage Loans and the principal component of any Subservicer Advance or of any REO
Proceeds received in connection with an REO Property for which an REO Disposition has occurred;
(ii) All payments on account of interest at the Adjusted Mortgage Rate on the Mortgage
Loans, including Buydown Funds, if any, and the interest component of any Subservicer Advance or of any
REO Proceeds received in connection with an REO Property for which an REO Disposition has occurred;
(iii) Insurance Proceeds, Subsequent Recoveries and Liquidation Proceeds (net of any related
expenses of the Subservicer);
(iv) All proceeds of any Mortgage Loans purchased pursuant to Section 2.02, 2.03, 2.04 or
4.07 (including amounts received from Residential Funding pursuant to the last paragraph of Section 4 of
the Assignment Agreement in respect of any liability, penalty or expense that resulted from a breach of
the Compliance With Laws Representation and all amounts required to be deposited in connection with the
substitution of a Qualified Substitute Mortgage Loan pursuant to Section 2.03 or 2.04;
(v) Any amounts required to be deposited pursuant to Section 3.07(c) or 3.21;
(vi) All amounts transferred from the Certificate Account to the Custodial Account in
accordance with Section 4.02(a);
(vii) Any amounts realized by the Subservicer and received by the Master Servicer in respect
of any Additional Collateral;
(viii) Any amounts received by the Master Servicer in respect of Pledged Assets; and
(ix) Any amounts received by the Master Servicer in connection with any Prepayment Charges
on the Prepayment Charge Loans.
The foregoing requirements for deposit in the Custodial Account shall be exclusive, it being understood
and agreed that, without limiting the generality of the foregoing, payments on the Mortgage Loans which are not
part of the Trust Fund (consisting of payments in respect of principal and interest on the Mortgage Loans due on
or before the Cut-off Date) and payments or collections in the nature of late payment charges or assumption fees
may but need not be deposited by the Master Servicer in the Custodial Account. In the event any amount not
required to be deposited in the Custodial Account is so deposited, the Master Servicer may at any time withdraw
such amount from the Custodial Account, any provision herein to the contrary notwithstanding. The Custodial
Account may contain funds that belong to one or more trust funds created for mortgage pass-through certificates
of other series and may contain other funds respecting payments on Mortgage Loans belonging to the Master
Servicer or serviced or master serviced by it on behalf of others. Notwithstanding such commingling of funds,
the Master Servicer shall keep records that accurately reflect the funds on deposit in the Custodial Account that
have been identified by it as being attributable to the Mortgage Loans.
With respect to Insurance Proceeds, Liquidation Proceeds, REO Proceeds and the proceeds of the purchase
of any Mortgage Loan pursuant to Sections 2.02, 2.03, 2.04 and 4.07 received in any calendar month, the Master
Servicer may elect to treat such amounts as included in the Available Distribution Amount for the Distribution
Date in the month of receipt, but is not obligated to do so. If the Master Servicer so elects, such amounts will
be deemed to have been received (and any related Realized Loss shall be deemed to have occurred) on the last day
of the month prior to the receipt thereof.
(c) (See Section 3.07(c) of the Standard Terms)
(d) (See Section 3.07(d) of the Standard Terms)
(e) Notwithstanding Section 3.07(a), The Master Servicer shall not waive (or permit a Subservicer
to waive) any Prepayment Charge unless: (i) the enforceability thereof shall have been limited by bankruptcy,
insolvency, moratorium, receivership and other similar laws relating to creditors' rights generally, (ii) the
enforcement thereof is illegal, or any local, state or federal agency has threatened legal action if the
prepayment penalty is enforced, (iii) the collectability thereof shall have been limited due to acceleration in
connection with a foreclosure or other involuntary payment or (iv) such waiver is standard and customary in
servicing similar Mortgage Loans and relates to a default or a reasonably foreseeable default and would, in the
reasonable judgment of the Master Servicer, maximize recovery of total proceeds taking into account the value of
such Prepayment Charge and the related Mortgage Loan. In no event will the Master Servicer waive a Prepayment
Charge in connection with a refinancing of a Mortgage Loan that is not related to a default or a reasonably
foreseeable default. If a Prepayment Charge is waived, but does not meet the standards described above, then the
Master Servicer is required to deposit into the Custodial Account the amount of such waived Prepayment Charge at
the time that the amount prepaid on the related Mortgage Loan is required to be deposited into the Custodial
Account. Notwithstanding any other provisions of this Agreement, any payments made by the Master Servicer in
respect of any waived Prepayment Charges pursuant to this Section shall be deemed to be paid outside of the Trust
Fund and not part of any REMIC.
Section 3.08. Subservicing Accounts; Servicing Accounts. (See Section 3.08 of the Standard Terms)
Section 3.09. Access to Certain Documentation and Information Regarding the Mortgage Loans. (See
Section 3.09 of the Standard Terms)
Section 3.10. Permitted Withdrawals from the Custodial Account. (See Section 3.10 of the Standard
Terms)
Section 3.11. Maintenance of the Primary Insurance Policies; Collections Thereunder. (See Section
3.11 of the Standard Terms)
Section 3.12. Maintenance of Fire Insurance and Omissions and Fidelity Coverage. (See Section 3.12
of the Standard Terms)
Section 3.13. Enforcement of Due-on-Sale Clauses; Assumption and Modification Agreements; Certain
Assignments. (See Section 3.13 of the Standard Terms)
Section 3.14. Realization Upon Defaulted Mortgage Loans. (See Section 3.14 of the Standard Terms)
Section 3.15. Trustee to Cooperate; Release of Mortgage Files. (See Section 3.15 of the Standard
Terms)
Section 3.16. Servicing and Other Compensation; Compensating Interest.
(a) (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 shall be deposited into the
Certificate Account and shall be paid on each Distribution Date to the Holders of the Class P
Certificates.
(c) (See Section 3.16(c) of the Standard Terms)
(d) (See Section 3.16(d) of the Standard Terms)
(e) (See Section 3.16(e) of the Standard Terms)
Section 3.17. Reports to the Trustee and the Company. (See Section 3.17 of the Standard Terms)
Section 3.18. Annual Statement as to Compliance. (See Section 3.18 of the Standard Terms)
Section 3.19. Annual Independent Public Accountants' Servicing Report. (See Section 3.19 of the
Standard Terms)
Section 3.20. Rights of the Company in Respect of the Master Servicer. (See Section 3.20 of the
Standard Terms)
Section 3.21. Administration of Buydown Funds. (See Section 3.21 of the Standard Terms)
Section 3.22 Advance Facility. (See Section 3.22 of the Standard Terms)
ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS
SECTION 4.01. CERTIFICATE ACCOUNT. (See Section 4.01 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 and REMIC II 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) Notwithstanding the distributions on the REMIC I Regular Interests 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 amounts to be paid from the Final Maturity
Reserve Account pursuant to Section 4.10(c) (except that, with respect to clause (x) below, such distribution
shall be to the extent of Prepayment Charges on deposit in the Certificate Account):
(i) The Interest Distribution Amount, sequentially:
(A) first, to the Class A-1, Class A-2 and Class A-3 Certificates,
Accrued Certificate Interest due thereon for such Distribution Date plus any Accrued
Certificate Interest due thereon remaining unpaid from any prior Distribution Date, together
with interest thereon at the related Pass-Through Rate in effect for such Distribution Date, on
a pro rata basis in accordance with the Accrued Certificate Interest and any interest thereon
due to each such class;
(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;
(H) eighth, to the Class M-7 Certificates, Accrued Certificate Interest
due thereon for such Distribution Date plus any Accrued Certificate Interest due thereon
remaining unpaid from any prior Distribution Date, together with interest thereon at the
related Pass-Through Rate in effect for such Distribution Date;
(I) ninth, to the Class M-8 Certificates Accrued Certificate Interest due
thereon for such Distribution Date plus any Accrued Certificate Interest due thereon remaining
unpaid from any prior Distribution Date, together with interest thereon at the related
Pass-Through Rate in effect for such Distribution Date;
(J) tenth, to the Class M-9 Certificates Accrued Certificate Interest due
thereon for such Distribution Date plus any Accrued Certificate Interest due thereon remaining
unpaid from any prior Distribution Date, together with interest thereon at the related
Pass-Through Rate in effect for such Distribution Date; and
(K) eleventh, to the Class B 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;
(ii) to the Class A, the Class M and the Class B 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 Certificate Principal Balance of each Class of Class A, Class M and Class B
Certificates has been reduced to zero;
(iii) to the Class A, Class M and Class B 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, Class M and Class B 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, Class M and Class B 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, Class M and Class B Certificateholders on a pro rata basis, based on
the amount of Prepayment Interest Shortfalls remaining unpaid;
(v) to the Holders of the Class A Certificates, pro rata, and then sequentially to the Class X-0, Xxxxx X-0,
Class M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class M-8 and Class M-9
Certificateholders, in that order, and then to the Holders of the Class B Certificates, any
Interest Carryforward Amounts allocated thereto that remain unreimbursed;
(vi) to the Class A, Class M and Class B Certificates from the amount, if any, of Excess Cash Flow remaining
after the foregoing distributions the amount of any Basis Risk Shortfall on such Certificates
(after giving effect, with respect to the initial Distribution Date, to payments made from the
Basis Risk Shortfall Reserve Fund), 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, Class M-6, Class M-7, Class M-8 and Class M-9 Certificateholders, in that order, and
then to the Class B Certificateholders;
(vii) to pay the Holders of the Class A, Class M and Class B 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,
(viii) to the Holders of the Class A Certificates (other than the Class A-1 Certificates), the principal
portion of any Realized Losses previously allocated to those Certificates and remaining
unreimbursed, which amount shall be allocated sequentially, in order of priority, then to the
Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class M-8 and
Class M-9 Certificateholders, in that order, and then to the Class B Certificateholders;
(ix) to the Class SB Certificates, 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, Class M and
Class B Certificate has been reduced to zero, the Overcollateralization Amount;
(x) to the Class P Certificates from prepayment charges on deposit in the Certificate Account, any
prepayment charges received on the Mortgage Loans during the related Prepayment Period; and
(xi) to the Class R-II Certificateholders, the balance, if any, of the Available Distribution Amount.
All payments of amounts in respect of Basis Risk Shortfalls made pursuant to Section 4.02(c)(vi) and any
other amounts in respect of interest accrued at a Pass-Through Rate in excess of the Modified Net WAC Rate Cap
shall, for federal income tax purposes, be deemed to have been distributed by REMIC II to REMIC III as the holder
of REMIC II Regular Interests SB-PO and SB-IO and by REMIC III to the Holder 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, Class M and Class B Certificateholders shall
be distributed as follows:
(i) first, the Class A Principal Distribution Amount shall be distributed concurrently, on a pro rata basis
in accordance with their respective Certificate Principal Balances, to the Class A-1, Class A-2
and Class A-3 Certificates, 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;
(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;
(viii) eighth, the Class M-7 Principal Distribution Amount shall be distributed to the Class M-7 Certificates
until the Certificate Principal Balance thereof has been reduced to zero;
(ix) ninth, the Class M-8 Principal Distribution Amount shall be distributed to the Class M-8 Certificates
until the Certificate Principal Balance thereof has been reduced to zero;
(x) tenth, the Class M-9 Principal Distribution Amount shall be distributed to the Class M-9 Certificates
until the Certificate Principal Balance thereof has been reduced to zero; and
(xi) eleventh, the Class B Principal Distribution Amount shall be distributed to the Class B 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, Class M or Class B 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), Interest Carryforward
Amounts pursuant to clause (c) (v) and Basis Risk Shortfall pursuant to clause (c)(vi).
(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) Except as otherwise provided in Section 9.01 of the Standard Terms, if the Master Servicer anticipates
that a final distribution with respect to any Class of Certificates will be made on a future Distribution Date,
the Master Servicer shall, no later than 40 days prior to such final Distribution Date, notify the Trustee and
the Trustee shall, not earlier than the 15th day and not later than the 25th day of the month next preceding the
month of such final distribution, distribute, or cause to be distributed, to each Holder of such Class of
Certificates a notice to the effect that: (i) the Trustee anticipates that the final distribution with respect to
such Class of Certificates will be made on such Distribution Date but only upon presentation and surrender of
such Certificates at the office of the Trustee or as otherwise specified therein, and (ii) no interest shall
accrue on such Certificates from and after the end of the related Interest Accrual Period. In the event that
Certificateholders required to surrender their Certificates pursuant to Section 9.01(c) of the Standard Terms do
not surrender their Certificates for final cancellation, the Trustee shall cause funds distributable with respect
to such Certificates to be withdrawn from the Certificate Account and credited to a separate escrow account for
the benefit of such Certificateholders as provided in Section 9.01(d) of the Standard Terms.
(H) On the initial Distribution Date, Basis Risk Shortfall amounts with respect to the initial Distribution
Date, if any, will be paid to the Holders of the Class A, Class M and Class B Certificates, pro rata, based on
the amount of Basis Risk Shortfalls for such Classes, from amounts withdrawn from the Basis Risk Shortfall
Reserve Fund.
SECTION 4.03. STATEMENTS TO CERTIFICATEHOLDERS; STATEMENTS TO THE RATING AGENCIES; EXCHANGE ACT REPORTING.
(See Section 4.03 of the Standard Terms.)
SECTION 4.04. DISTRIBUTION OF REPORTS TO THE TRUSTEE AND THE COMPANY; ADVANCES BY THE MASTER SERVICER.
(a) (See Section 4.04(a) of the Standard Terms)
(b) On or before 2:00 P.M. New York time on each Certificate Account Deposit Date, the
Master Servicer shall either (i) deposit in the Certificate Account from its own funds, or funds received
therefor from the Subservicers, an amount equal to the Advances to be made by the Master Servicer in respect of
the related Distribution Date, which shall be in an aggregate amount equal to the aggregate amount of Monthly
Payments (with each interest portion thereof adjusted to the Net Mortgage Rate), less the amount of any related
Servicing Modifications, Debt Service Reductions or reductions in the amount of interest collectable from the
Mortgagor pursuant to the Servicemembers Civil Relief Act, as amended, or similar legislation or regulations then
in effect, on the Outstanding Mortgage Loans as of the related Due Date, which Monthly Payments were not received
as of the close of business as of the related Determination Date; provided that no Advance shall be made if it
would be a Nonrecoverable Advance; and provided, further, that the Monthly Payment for purposes of this Section
4.04 shall mean the minimum monthly payment due under the Mortgage Note, net of the Servicing Fee and
Subservicing Fee, (ii) withdraw from amounts on deposit in the Custodial Account and deposit in the Certificate
Account all or a portion of the Amount Held for Future Distribution in discharge of any such Advance, or (iii)
make advances in the form of any combination of (i) and (ii) aggregating the amount of such Advance. Any portion
of the Amount Held for Future Distribution so used shall be replaced by the Master Servicer by deposit in the
Certificate Account on or before 11:00 A.M. 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.
(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 B Certificates, until the Certificate Principal Balance thereof has been reduced to
zero;
fourth, to the Class M-9 Certificates, until the Certificate Principal Balance thereof has been reduced
to zero;
fifth, to the Class M-8 Certificates, until the Certificate Principal Balance thereof has been reduced
to zero;
sixth, to the Class M-7 Certificates, until the Certificate Principal Balance thereof has been reduced
to zero;
seventh, to the Class M-6 Certificates, until the Certificate Principal Balance thereof has been reduced
to zero;
eighth, to the Class M-5 Certificates, until the Certificate Principal Balance thereof has been reduced
to zero;
ninth, to the Class M-4 Certificates, until the Certificate Principal Balance thereof has been reduced
to zero;
tenth, to the Class M-3 Certificates, until the Certificate Principal Balance thereof has been reduced
to zero;
eleventh, to the Class M-2 Certificates, until the Certificate Principal Balance thereof has been
reduced to zero;
twelfth, to the Class M-1 Certificates, until the Certificate Principal Balance thereof has been reduced
to zero;
thirteenth, to the Class A-3 Certificates, until the Certificate Principal Balance thereof has been
reduced to zero; and
fourteenth, to the Class A-2 Certificates, until the Certificate Principal Balance thereof has been
reduced to zero.
(B) Any allocation of the principal portion of Realized Losses (other than Debt Service Reductions) to any
Class of Class X-0, Xxxxx X-0, Class M or Class B 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 A, Class M or Class B 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.
(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. 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 II 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 II 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 II Regular Interest SB-PO until such
principal balance shall have been reduced to zero and thereafter to reduce accrued and unpaid interest on REMIC
II 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. BASIS RISK SHORTFALL RESERVE FUND.
(a) On or before the Closing Date, the Trustee shall establish a Reserve Fund on behalf of the Holders of
the Class A, Class M and Class B Certificates. The Reserve Fund must be an Eligible Account. The Reserve Fund
shall be entitled "Basis Risk Shortfall 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-QO10" (the "Basis Risk Shortfall Reserve Fund"). The Basis Risk Shortfall Reserve Fund shall be an Eligible
Account or a sub-account of an Eligible Account. On the Closing Date, the Depositor will cause, on behalf of the
Trust, the Basis Risk Shortfall Reserve Fund Amount to be deposited into the Basis Risk Shortfall Reserve Fund.
Pursuant to Section 4.02(h), on the initial Distribution Date, amounts on deposit in the Basis Risk Shortfall
Reserve Fund will be withdrawn from the Basis Risk Shortfall Reserve Fund and deposited into the Certificate
Account for payment to the Class A, Class M and Class B Certificates to the extent of any Basis Risk Shortfall
Amount on the Class A, Class M and Class B Certificates on such initial Distribution Date. After the initial
Distribution Date, all amounts remaining in the Basis Risk Shortfall Reserve Fund will be distributed to Xxxxxxx,
Xxxxx & Co. or its designee, and following such withdrawal the Basis Risk Shortfall Reserve Fund will be closed.
(b) The Trustee will invest funds deposited in the Basis Risk Shortfall Reserve Fund as directed by the
Depositor or its designee in writing in Permitted Investments with a maturity date (i) no later than the Business
Day immediately preceding the date on which such funds are required to be withdrawn from such account pursuant to
this Agreement, if a Person other than the Trustee or an Affiliate of the Trustee is the obligor for the
Permitted Investment, or (ii) no later than the date on which such funds are required to be withdrawn from such
account or sub account of a trust account pursuant to this Agreement, if the Trustee or an affiliate of the
Trustee is the obligor for the Permitted Investment (or, if no written direction is received by the Trustee from
the Depositor, then funds in such account shall remain uninvested). For federal income tax purposes, the
Depositor shall be the owner of the Basis Risk Shortfall Reserve Fund and shall report all items of income,
deduction, gain or loss arising therefrom. At no time will the Basis Risk Shortfall Reserve Fund be an asset of
any REMIC created hereunder. All income and gain realized from investment of funds deposited in the Basis Risk
Shortfall Reserve Fund, which investment shall be made solely upon the written direction of the Depositor, shall
be for the sole and exclusive benefit of the Depositor and shall be remitted by the Trustee to the Depositor
within one Business Day from the closing of the Basis Risk Shortfall Reserve Fund. The Depositor shall deposit in
the Basis Risk Shortfall Reserve Fund the amount of any net loss incurred in respect of any such Permitted
Investment immediately upon realization of such loss.
SECTION 4.10. FINAL MATURITY RESERVE ACCOUNT.
(a) The Supplemental Interest Trust Trustee shall establish on behalf of the Holders of the Class A, Class M
and Class B Certificates, the Final Maturity Reserve Account as a separate trust account. The Supplemental
Interest Trust Trustee shall keep records that accurately reflect the funds on deposit in the Final Maturity
Reserve Account. The Depositor, concurrently with the execution and delivery of this Agreement, shall sell,
transfer and assign to the Supplemental Interest Trust without recourse all its right, title and interest in and
to such assets relating to the Mortgage Loans as from time to time may be held by the Supplemental Interest Trust
Trustee in the Final Maturity Reserve Account.
(b) If, on the Distribution Date occurring in January 2017, or on any Distribution Date thereafter, through
and including the Distribution Date in December 2036, any Class A, Class M or Class B Certificates are
outstanding and the Mortgage Loans with original terms to maturity in excess of 30 years are outstanding, the
Supplemental Interest Trust Trustee shall deposit into the Final Maturity Reserve Account, the Coupon Strip for
such Distribution Date.
(c) On any Distribution Date, any amounts on deposit in the Final Maturity Reserve Account in excess of the
lesser of (i) the aggregate Certificate Principal Balance of the Class A, Class M or Class B Certificates and
(ii) the aggregate Stated Principal Balance of the Mortgage Loans with original terms to maturity in excess of 30
years, will be withdrawn from the Final Maturity Reserve Account and will be distributed in accordance with
Section 4.02(c). Amounts on deposit in the Final Maturity Reserve Account shall be held uninvested, and the
Supplemental Interest Trust Trustee shall have no liability for interest or other compensation thereon.
(d) On the earlier of the Distribution Date occurring in January 2037 and the Distribution Date on which the
final distribution of payments from the Mortgage Loans and the other assets in the trust is expected to be made,
any remaining amounts on deposit in the Final Maturity Reserve Account will be distributed first, to the Class A
Certificates, on a pro rata basis, in each case until the Certificate Principal Balance thereof has been reduced
to zero, second, to the Class M Certificates in their order of payment priority and then to the Class B
Certificates, in each case until the Certificate Principal Balance thereof has been reduced to zero, and third,
to the Class SB Certificates, in each case after giving effect to the distribution of the Available Distribution
Amount on such Distribution Date.
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 B, Class SB 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, Class
SB or Class P Certificate, other than the transfer of an interest in a Class B, Class SB or Class P
Certificate that is held by a Transferor and to be held by a Transferee as an interest in a Rule 144A
Global Offered Certificate, 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 (with
respect to any Class B Certificate or Class SB Certificate) or Exhibit G-1 to the Standard Terms (with
respect to any Class P Certificate), 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 to the Standard
Terms (or such other form as the Company in its sole discretion deems acceptable), which investment
letter shall not be an expense of the Trustee, the Company or the Master Servicer, and which investment
letter states that, among other things, such transferee (A) is a "qualified institutional buyer" as
defined under Rule 144A, acting for its own account or the accounts of other "qualified institutional
buyers" as defined under Rule 144A, and (B) is aware that the proposed transferor intends to rely on the
exemption from registration requirements under the Securities Act of 1933, as amended, provided by Rule
144A.
The Holder of any such Class B, Class SB or Class P 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. If any
transfer of a Class B, Class SB or Class P Certificate held by a Transferor and to be held by a Transferee as an
interest in a Rule 144A Global Offered Certificate is to made without registration under the 1933 Act, the
Transferor shall be deemed to have made each of the certifications set forth in Exhibit I to the Standard Terms
as of the transfer date and the Transferee shall be deemed to have made each of the certifications set forth in
Exhibit J to the Standard Terms as of the transfer date, in each case as if such Class B, Class SB or Class P
Certificate were in physical form.
(e) (i) In the case of any Class B, Class SB, 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 SB, 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 to the Standard Terms (with respect to any Class B Certificate) or paragraph
fifteen of Exhibit G-1 to the Standard Terms (with respect to any Class SB, Class R 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 of PTCE 95-60 have been
satisfied (each entity that satisfies this clause (b), a "Complying Insurance Company"). In
the case of any Class B, Class SB or Class P Certificate to be held by a Transferee as an
interest in a Rule 144A Global Offered Certificate, the Transferee shall be deemed by virtue of
its purchase or holding of an interest in such Certificate to have made each of the
certifications set forth in Exhibit H to the Standard Terms (with respect to any Class B
Certificate) or Exhibit G-1 to the Standard Terms (with respect to any Class SB Certificate or
Class P Certificate) as of the transfer date, in each case as if such Class B, Class SB and
Class P Certificate were in physical form.
(ii) Any Transferee of a Class M Certificate that is acquired after termination of the
Final Maturity Reserve Account 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 Moody's or (c) such Transferee is a Complying Insurance Company.
(iii) Any Transferee of a Class A Certificate or Class M Certificate that is acquired by a
Plan Investor prior to the termination of the Final Maturity Reserve Account, shall be deemed
to have represented, by virtue of its acquisition or holding of that certificate or interest
therein that its acquisition of such Certificate and its right to receive (and its receipt of)
payments from the Supplemental Interest Trust are eligible for the exemptive relief under at
least one of XXXX 00-00, XXXX 00-0, XXXX 91-38, PTCE 95-60 or PTCE 96-23 or other applicable
exemption.
(iv) (A) If any Certificate (or any interest therein) is acquired or held by any Person
that does not satisfy the conditions described in paragraph (i), (ii) or (iii), as applicable,
above, then the last preceding Transferee that either (I) is not a Plan Investor or (II)
acquired such Certificate in compliance with the conditions described in paragraph (i), (ii) or
(iii), as applicable, 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
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 Certificate (or
interest therein) was effected in violation of the restrictions in this Section 5.02(e) shall
indemnify and hold harmless the Company, the Trustee, the Master Servicer, any Subservicer, the
Underwriters and the Trust Fund from and against any and all liabilities, claims, costs or
expenses incurred by such parties as a result of such acquisition or holding.
(f) (See Section 5.02(f) of the Standard Terms)
(g) (See Section 5.02(g) of the Standard Terms)
(h) (See Section 5.02(h) of the Standard Terms)
(i) (i) Provisions Regarding Rule 144A and Regulation S Transfers. (i) Class B, Class SB and
Class P Certificates sold to "qualified institutional buyers" as defined in and in reliance on Rule 144A under
the 1933 Act shall be represented by one or more Rule 144A Global Offered Certificates. Class B , Class SB and
Class P Certificates sold in offshore transactions in reliance on Regulation S under the Securities Act shall be
represented initially by Temporary Regulation S Global Offered Certificates.
(ii) The Temporary Regulation S Global Offered Certificates shall be exchanged on the later of (a) 40 days
after the later of the Closing Date (b) the date on which the requisite certifications are due to and provided to
the Trustee (the later of clauses (a) and (b), the "Exchange Date") for Permanent Regulation S Global Offered
Certificates. Regulation S Global Offered Certificates shall be issued in registered form, without coupons, and
deposited upon the order of the Transferor with the Trustee as custodian for and registered in the name of a
nominee of the Depository for credit to the account of the depositaries for Euroclear and Clearstream.
(iii) A Certificate Owner holding an interest in a Temporary Regulation S Global Offered Certificate may
receive payments in respect of the Certificates on the Temporary Regulation S Global Offered Certificate only
after the delivery, to Euroclear or Clearstream, as the case may be, of a written certification substantially in
the form set forth in Exhibit Four, and upon delivery by Euroclear or Clearstream, as the case may be, to the
Trustee and Certificate Registrar of a certification or certifications substantially in the form set forth in
Exhibit Five (the "Clearing System Certificate"). The delivery by a Certificate Owner of the certification
referred to above shall constitute its irrevocable instruction to Euroclear or Clearstream, as the case may be,
to arrange for the exchange of the Certificate Owner's interest in the Temporary Regulation S Global Offered
Certificate for a beneficial interest in the Permanent Regulation S Global Offered Certificate after the Exchange
Date in accordance with paragraph (iv) below.
(iv) After (i) the Exchange Date and (ii) receipt by the Certificate Registrar of written instructions from
Euroclear or Clearstream, as the case may be, directing the Certificate Registrar to credit or cause to be
credited to either Euroclear's or Clearstream's, as the case may be, Depository's account a beneficial interest
in the Permanent Regulation S Global Offered Certificate in a principal amount not greater than that of the
beneficial interest in the Temporary Regulation S Global Offered Certificate, the Certificate Registrar shall
instruct the Depository to reduce the principal amount of the Temporary Regulation S Global Offered Certificate
and increase the principal amount of the Permanent Regulation S Global Offered Certificate, by the principal
amount of the beneficial interest in the Temporary Regulation S Global Offered Certificate to be so transferred,
and to credit or cause to be credited to the account of Euroclear, Clearstream or a Person who has an account
with the Depository as the case may be, a beneficial interest in the Permanent Regulation S Global Offered
Certificate having a Certificate Principal Balance of the Temporary Regulation S Global Class B that was reduced
upon the transfer. Upon return of the entire principal amount of the Temporary Regulation S Global Offered
Certificate to the Trustee in exchange for beneficial interests in the Permanent Regulation S Global Offered
Certificate, Trustee shall cancel the Temporary Regulation S Global Offered Certificate by perforation and shall
forthwith destroy it.
(v) For transfer of an interest in a Permanent Regulation S Global Offered Certificate for an interest in
the Rule 144A Global Offered Certificate, if the Certificateholder of a beneficial interest in a Permanent
Regulation S Global Offered Certificate deposited with the Depository wishes at any time to exchange its interest
in the Permanent Regulation S Global Offered Certificate, or to transfer its interest in the Permanent Regulation
S Global Offered Certificate to a Person who wishes to take delivery thereof in the form of an interest in the
Rule 144A Global Offered Certificate, the Certificateholder may, subject to the rules and procedures of Euroclear
or Clearstream and the Depository, as the case may be, give directions for the Certificate Registrar to exchange
or cause the exchange or transfer or cause the transfer of the interest for an equivalent beneficial interest in
the Rule 144A Global Offered Certificate. Upon receipt by the Certificate Registrar of instructions from
Euroclear or Clearstream, from the Depository or from the Certificateholder, as the case may be, directing the
Certificate Registrar to credit or cause to be credited a beneficial interest in the Rule 144A Global Offered
Certificate equal to the Percentage Interest in the Permanent Regulation S Global Offered Certificate to be
exchanged or transferred (such instructions to contain information regarding the Depository Participant account
to be credited with the increase, and, with respect to an exchange or transfer of an interest in the Permanent
Regulation S Global Offered Certificate, information regarding the Depository Participant account to be debited
with the decrease), the Certificate Registrar shall instruct the Depository to reduce the Permanent Regulation S
Global Offered Certificate by the aggregate principal amount of the beneficial interest in the Permanent
Regulation S Global Offered Certificate to be so exchanged or transferred, and the Certificate Registrar shall
instruct the Depository, concurrently with the reduction, to increase the principal amount of the Rule 144A
Global Offered Certificate by the aggregate Certificate Principal Balance of the beneficial interest in the
Permanent Regulation S Global Offered Certificate to be so exchanged or transferred, and to credit or cause to be
credited to the account of the Person specified in the instructions a beneficial interest in the Rule 144A Global
Offered Certificate equal to the reduction in the Certificate Principal Balance of the Permanent Regulation S
Global Offered Certificate.
(vi) For transfers of an interest in the Rule 144A Global Offered Certificate for an interest in a Regulation
S Global Offered Certificate, if a Certificate Owner holding a beneficial interest in the Rule 144A Global
Offered Certificate wishes at any time to exchange its interest in the Rule 144A Global Offered Certificate for
an interest in a Regulation S Global Offered Certificate, or to transfer its interest in the 144A Book-Entry
Certificate to a Person who wishes to take delivery thereof in the form of an interest in the Regulation S Global
Offered Certificate, the Certificateholder may, subject to the rules and procedures of the Depository, give
directions for the Certificate Registrar to exchange or cause the exchange or transfer or cause the transfer of
the interest for an equivalent beneficial interest in the Regulation S Global Offered Certificate. Upon receipt
by the Certificate Registrar of (A) instructions given in accordance with the Depository's procedures from a
Depository Participant or from the Certificateholder, as the case may be, directing the Certificate Registrar to
credit or cause to be credited a beneficial interest in the Regulation S Global Offered Certificate in an amount
equal to the beneficial interest in the Rule 144A Global Offered Certificate to be exchanged or transferred,
(B) a written order given in accordance with the Depository's procedures containing information regarding the
account of the depositaries for Euroclear or Clearstream or another Depository Participant, as the case may be,
to be credited with the increase and the name of the account and (C) certificates in the forms of Exhibits Six
and Seven, respectively, given by the Certificate Owner and the proposed transferee of the interest, the
Certificate Registrar shall instruct the Depository to reduce the Rule 144A Global Offered Certificate by the
aggregate principal amount of the beneficial interest in the Rule 144A Global Offered Certificate to be so
exchanged or transferred and the Certificate Registrar shall instruct the Depository, concurrently with the
reduction, to increase the principal amount of the Regulation S Global Offered Certificate by the aggregate
Certificate Principal Balance of the beneficial interest in the Rule 144A Global Offered Certificate to be so
exchanged or transferred, and to credit or cause to be credited to the account of the Person specified in the
instructions a beneficial interest in the Regulation S Global Offered Certificate equal to the reduction in the
Certificate Principal Balance of the Rule 144A Global Offered Certificate.
(vii) Notwithstanding any other provisions of this Section 5.02(i), the Underwriter may exchange beneficial
interests in the Temporary Regulation S Global Offered Certificates held by it for interests in the Rule 144A
Global Offered Certificates only after delivery by the Underwriter of instructions for the exchange substantially
in the form of Exhibit Eight. Upon receipt of the instructions provided in the preceding sentence, the
Certificate Registrar shall instruct the Depository to reduce the principal amount of the Temporary Regulation S
Global Offered Certificate to be so transferred and shall instruct the Depository to increase the principal
amount of the Rule 144A Global Offered Certificate and credit or cause to be credited to the account of the
placement agent a beneficial interest in the Rule 144A Global Offered Certificate having a principal amount equal
to the amount by which the principal amount of the Temporary Regulation S Global Offered Certificate was reduced
upon the transfer pursuant to the instructions provided in the first sentence of this clause (vii).
ARTICLE VI
THE COMPANY AND THE MASTER SERVICER
SECTION 6.01. RESPECTIVE LIABILITIES OF THE COMPANY AND MASTER SERVICER. (See Section 6.01 of the Standard
Terms.)
SECTION 6.02. MERGER OR CONSOLIDATION OF THE COMPANY OR MASTER SERVICER; ASSIGNMENT OF RIGHTS AND DELEGATION
OF DUTIES BY THE MASTER SERVICER.
(a) (See Section 6.08(a) of the Standard Terms.).
(b) Any Person into which the 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 Mae or
Xxxxxxx Mac; and provided further that each Rating Agency's ratings, if any, of any Class of Class A Certificates
or Class M Certificates in effect immediately prior to such merger or consolidation will not be qualified,
reduced or withdrawn as a result thereof (as evidenced by a letter to such effect from each Rating Agency).
(c) (See Section 6.08(c) of the Standard Terms).
SECTION 6.03. LIMITATION ON LIABILITY OF THE COMPANY, MASTER SERVICER AND OTHERS. (See Section 6.03 of the
Standard Terms.)
SECTION 6.04. COMPANY AND MASTER SERVICER NOT TO RESIGN. (See Section 6.04 of the Standard Terms.)
ARTICLE VII
DEFAULT
(See Article VII of the Standard Terms.)
ARTICLE VIII
CONCERNING THE TRUSTEE 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 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
Interest 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 and Supplemental Interest Trust 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 (in all its capacities) 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 of the
Standard Terms or an Event of Default under clauses (iii), (iv) and (v) of Section 7.01 of the Standard Terms
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 of the Standard Terms, 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 or
Supplemental Interest Trust Trustee, as applicable.
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, the Supplemental Interest Trust
Trustee and any co-trustee from time to time, and the Trustee, the Supplemental Interest Trust 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, the Supplemental Interest Trust Trustee and any co-trustee, and the Master Servicer
will pay or reimburse the Trustee, the Supplemental Interest Trust Trustee and any co-trustee upon request for
all reasonable expenses, disbursements and advances incurred or made by the Trustee, the Supplemental Interest
Trust Trustee and 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, the Supplemental Interest Trust 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 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 the
Supplemental Interest Trust Trustee's, as applicable, part, arising out of, or in connection with, the acceptance
and administration of the Trust Fund or the 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 and the Custodial
Agreement, and the Master Servicer further agrees to indemnify the Trustee and the Supplemental Interest Trust
Trustee for, and to hold the Trustee and the Supplemental Interest Trust 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 and the Supplemental Interest Trust
Trustee shall have given the Master Servicer written notice thereof promptly after the Trustee and the
Supplemental Interest Trust Trustee shall have actual knowledge thereof;
(ii) while maintaining control over its own defense, the Trustee and the Supplemental
Interest Trust 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 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.
(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) 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 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 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 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 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. (See Section 8.11 of the Standard Terms)
SECTION 8.12. APPOINTMENT OF OFFICE OR AGENCY. (See Section 8.12 of the Standard Terms)
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 (A) 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 and (B) if a net interest margin transaction with respect to the
Class SB Certificates is then outstanding, the consent of Xxxxxxx, Xxxxx & Co. to purchase the assets of the
Trust Fund.
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 the 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, with the
consent of Xxxxxxx, Sachs & Co. if a net interest margin transaction with respect to the Class SB Certificates is
then outstanding, 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 and the Supplemental Interest Trust 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 or Trustee 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. 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) (See Section 9.01(c) of the Standard Terms)
(d) (See Section 9.01(d) of the Standard Terms)
(e) (See Section 9.01(e) of the Standard Terms)
SECTION 9.02. ADDITIONAL TERMINATION REQUIREMENTS. (See Section 9.02 of the Standard Terms)
SECTION 9.03. TERMINATION OF MULTIPLE REMICS. (See Section 9.03 of the Standard Terms)
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 Basis Risk Shortfall
Reserve Fund and the Final Maturity Reserve Account), and subject to this Agreement, as a REMIC (REMIC I) for
federal income tax purposes. The REMIC Administrator will make an election to treat the segregated pool of
assets consisting of the REMIC I Regular Interests as a REMIC (REMIC II) for federal income tax purposes. The
REMIC Administrator will make an election to treat the pool of assets comprised of REMIC II Regular Interests
SB-IO and SB-PO as a REMIC (REMIC III) for federal income tax purposes.
The REMIC I Regular Interests will be "regular interests" in REMIC I and the Class R-I 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 Class A-1 Certificates, Class A-2 Certificates, Class A-3 Certificates, Class M-1 Certificates,
Class M-2 Certificates, Class M-3 Certificates, Class M-4 Certificates, Class M-5 Certificates, Class M-6
Certificates, Class M-7 Certificates, Class M-8 Certificates, Class M-9 Certificates and REMIC II Regular
Interests SB-PO and SB-IO will be "regular interests" in REMIC II, and the Class R-II Certificates will represent
the sole class of "residual interests" in REMIC II for purposes of the REMIC Provisions under federal income tax
law.
The REMIC III Regular Interest will be the "regular interest" in REMIC III, 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 III for purposes of the REMIC Provisions under federal income tax law.
SECTION 10.04. DISTRIBUTIONS ON THE REMIC I 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. (See Section 11.01 of the Standard Terms.)
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-QO10
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, Inc. 00 Xxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
--------------------------------------------- ------------------------------------------------------------------------
--------------------------------------------- ------------------------------------------------------------------------
Standard & Poor's Ratings Services, a 00 Xxxxx Xxxxxx
division of The XxXxxx-Xxxx Companies, Inc. 00xx Xxxxx
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.
97.0% of all of the Voting Rights shall be allocated among Holders of the Class A, Class M and Class B
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 the Class SB Certificates; 1.0% of all Voting
Rights shall be allocated among the Holders of the Class P Certificates in proportion to the percentage interests
evidenced by their respective Certificates; 1/3 of 1% of all Voting Rights shall be allocated among the Holders
of each Class of Class R 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)
IN WITNESS WHEREOF, the Company, the Master Servicer and the Trustee have caused their names to be
signed hereto by their respective officers thereunto duly authorized and their respective seals, duly attested,
to be hereunto affixed, all as of the day and year first above written.
RESIDENTIAL ACCREDIT LOANS, INC.
[Seal]
By: /s/Xxxxxxx Xxxxxxxx
Name: Xxxxxxx Xxxxxxxx
Title: Vice President
Attest: /s/Xxxxxx Xxxxxx
Name: Xxxxxx Xxxxxx
Title: Vice President
RESIDENTIAL FUNDING COMPANY, LLC
[Seal]
By: /s/Xxxxxx Xxxxxx
Name: Xxxxxx Xxxxxx
Title: Associate
Attest: /s/Xxxxxxx Xxxxxxxx
Name: Xxxxxxx Xxxxxxxx
Title: Associate
DEUTSCHE BANK TRUST COMPANY AMERICAS, as Trustee and
[Seal] Supplemental Interest Trust Trustee
By: /s/Xxxxxxx Xxxxxxxxx
Name: Xxxxxxx Xxxxxxxxx
Title: Authorized Signer
By: /s/ Xxxxxxx Xxxxxxxx
Name: Xxxxxxx Xxxxxxxx
Title: Vice President
Attest: /s/Xxx Xxxxxxxx
Name: Xxx Xxxxxxxx
Title: Authorized Signer
STATE OF MINNESOTA )
) ss.:
COUNTY OF HENNEPIN )
On the 28th day of December, 2006 before me, a notary public in and for said State, personally appeared
Xxxxxxx Xxxxxxxx known to me to be a Vice President of Residential Accredit Loans, Inc., the corporation 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.
/s/Xxx Xxx Xxxxx
Notary Public
[Notarial Seal]
STATE OF MINNESOTA )
) ss.:
COUNTY OF HENNEPIN )
On the 28th day of December, 2006 before me, a notary public in and for said State, personally appeared
Xxxxxx Xxxxxx known to me to be a(n) Associate of Residential Funding Company, LLC, the limited liability company
that executed the within instrument, and also known to me to be the person who executed it on behalf of said
limited liability company, and acknowledged to me that such limited liability 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.
/s/Xxx Xxx Xxxxx
Notary Public
[Notarial Seal]
STATE OF CALIFORNIA )
) ss.:
COUNTY OF ORANGE )
On the 28th day of December, 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 New York
banking corporation that executed the within instrument, and also known to me to be the person who executed it on
behalf of said banking corporation and acknowledged to me that such banking 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.
/s/Xxxxxxxxx Xxxx
Notary Public
[Notarial Seal]
STATE OF CALIFORNIA )
) ss.:
COUNTY OF ORANGE )
On the 28th day of December, 2006 before me, a notary public in and for said State, personally appeared
Xxxxxxx Xxxxxxxx known to me to be a(n) Vice President of DEUTSCHE BANK TRUST COMPANY AMERICAS, the New York
banking corporation that executed the within instrument, and also known to me to be the person who executed it on
behalf of said banking corporation and acknowledged to me that such banking 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.
/s/Xxxxxxxxx Xxxx
Notary Public
[Notarial Seal]
EXHIBIT ONE
MORTGAGE LOAN SCHEDULE
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, the Modified Net WAC Cap Rate and the
Available Funds Rate for such Distribution Date, separately identifying LIBOR for such Distribution Date;
(xxi) the Basis Risk Shortfall and Interest Carryforward Amount, if any, for each Class of Certificates,
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;
(xxviii) the amount of any payment made from the Basis Risk Shortfall Reserve Fund on the initial
Distribution Date and the balance of the Basis Risk Shortfall Reserve Fund after giving effect to such
amounts.
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 DECEMBER 1, 2006
================================================================================================
STANDARD TERMS OF
POOLING AND SERVICING AGREEMENT
Dated as of December 1, 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................46
Section 2.05. Execution and Authentication of Certificates/Issuance of
Certificates Evidencing Interests in REMIC I Certificates........48
Section 2.06. Conveyance of Uncertificated REMIC I and REMIC II Regular
Interests; Acceptance by the Trustee.............................48
Section 2.07. Issuance of Certificates Evidencing Interests in REMIC II............48
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...............................................52
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...................................................57
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...60
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.....................67
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..............70
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. ..................................................76
Section 4.03. Statements to Certificateholders; Statements to Rating Agencies;
Exchange Act Reporting...........................................76
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........80
Section 4.07. Optional Purchase of Defaulted Mortgage Loans........................80
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..........................................90
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 00.00.Xx 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 00.00.Xxxxxx 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 December 1,
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 REMIC Regular
Interest or Interests Z 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,
deliver to and deposit with the Trustee, or to the Custodian on behalf of the Trustee, 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 (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 (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 required to be delivered to the Trustee (or the Custodian on behalf of the
Trustee) pursuant to Section 2.01(b) 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 REMIC Regular Interests Z 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 REMIC Regular Interests Z 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 REMIC Regular Interest Z 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 the 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, which may
be non-interest bearing, 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, which may be non-interest bearing, 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 Only/Class A-V] Notional
First Distribution Date: Amount] [Subclass Notional Amount] of the
_________ 25, ____ Class A- Certificates:
Master Servicer: [Initial] [Certificate Principal
Residential Funding Balance] [Interest Only/Class A-V] [Subclass]
Company, LLC Notional Amount] of this Certificate:
$ ]
Assumed Final
Distribution Date: CUSIP 76110F-
___________ 25, ____
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 the
Residential Funding Company, LLC Class X Certificates: $__________
First Distribution Date: Initial Notional Amount of this Certificate:
__________ 25, ____ $_____________
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 X 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 M- 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 B- 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 of this
__________ 25, ____ Certificate: $____
Master Servicer: Percentage Interest of this Certificate:
Residential Funding Company, LLC 100%
Assumed Final Distribution Date: CUSIP: __________
__________ 25, ____
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 P 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.
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.
__________________________,
as Trustee
By:........................................
Authorized Signatory
Dated: _________, ____
CERTIFICATE OF AUTHENTICATION
This is one of the Class SB-[ ] 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 R 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 X.X.X.xx. 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":
-------------------------------------------------------------------------- ------------------
APPLICABLE
SERVICING
SERVICING CRITERIA CRITERIA
-------------------------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
REFERENCE CRITERIA
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
GENERAL SERVICING CONSIDERATIONS
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
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.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
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.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
1122(d)(1)(iii) Any requirements in the transaction agreements to
maintain a back-up servicer for the pool assets are
maintained.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
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.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
CASH COLLECTION AND ADMINISTRATION
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
1122(d)(2)(i) Payments on pool assets are deposited into the |X| (as to
appropriate custodial bank accounts and related bank
clearing accounts no more than two business days
following receipt, or such other number of days accounts held by
specified in the transaction agreements. Trustee)
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
1122(d)(2)(ii) Disbursements made via wire transfer on behalf of an |X| (as to
obligor or to an investor are made only by authorized investors only)
personnel.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
1122(d)(2)(iii) Advances of funds or guarantees regarding collections,
cash flows or distributions, and any interest or other
fees charged for such advances, are made, reviewed and
approved as specified in the transaction agreements.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
The related accounts for the transaction, such as cash
reserve accounts or accounts established as a form of |X| (as to
overcollateralization, are separately maintained accounts held by
(e.g., with respect to commingling of cash) as set Trustee)
1122(d)(2)(iv) forth in the transaction agreements.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
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.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
1122(d)(2)(vi) Unissued checks are safeguarded so as to prevent
unauthorized access.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
1122(d)(2)(vii) Reconciliations are prepared on a monthly basis for
all asset-backed securities related bank accounts,
including custodial accounts and related bank clearing
accounts. These reconciliations are (A) mathematically
accurate; (B) prepared within 30 calendar days after
the bank statement cutoff date, or such other number
of days specified in the transaction agreements; (C)
reviewed and approved by someone other than the person
who prepared the reconciliation; and (D) contain
explanations for reconciling items. These reconciling
items are resolved within 90 calendar days of their
original identification, or such other number of days
specified in the transaction agreements.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
INVESTOR REMITTANCES AND REPORTING
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
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.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
1122(d)(3)(ii) Amounts due to investors are allocated and remitted in |X|
accordance with timeframes, distribution priority and
other terms set forth in the transaction agreements.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
Disbursements made to an investor are posted within
two business days to the servicer's investor records,
or such other number of days specified in the |X|
1122(d)(3)(iii) transaction agreements.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
Amounts remitted to investors per the investor reports
agree with cancelled checks, or other form of payment, |X|
1122(d)(3)(iv) or custodial bank statements.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
POOL ASSET ADMINISTRATION
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
1122(d)(4)(i) Collateral or security on pool assets is maintained as
required by the transaction agreements or related
asset pool documents.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
Pool assets and related documents are safeguarded as
1122(d)(4)(ii) required by the transaction agreements
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
1122(d)(4)(iii) Any additions, removals or substitutions to the asset
pool are made, reviewed and approved in accordance
with any conditions or requirements in the transaction
agreements.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
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.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
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.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
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.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
1122(d)(4)(vii) Loss mitigation or recovery actions (e.g., forbearance
plans, modifications and deeds in lieu of foreclosure,
foreclosures and repossessions, as applicable) are
initiated, conducted and concluded in accordance with
the timeframes or other requirements established by
the transaction agreements.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
1122(d)(4)(viii) Records 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).
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
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.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
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.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
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.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
1122(d)(4)(xii) Any late payment penalties in connection with any
payment to be made on behalf of an obligor are paid
from the servicer's funds and not charged to the
obligor, unless the late payment was due to the
obligor's error or omission.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
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
1122(d)(4)(xiii) days specified in the transaction agreements.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
1122(d)(4)(xiv) Delinquencies, charge-offs and uncollectible accounts
are recognized and recorded in accordance with the
transaction agreements.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
Any external enhancement or other support, identified
in Item 1114(a)(1) through (3) or Item 1115 of
Regulation AB, is maintained as set forth in the |X|
1122(d)(4)(xv) transaction agreements.
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
----------------- -------------------------------------------------------- ------------------
(1) Only paragraph (a) for Class P Certificates.
(2) Class B Certificateholders may represent to either (a) or (b).
EXHIBIT FOUR
FORM OF CERTIFICATE TO BE GIVEN BY CERTIFICATE OWNER
Euroclear Clearstream Banking, societe anonyme
000 Xxxxxxxxx Xxxxxxxx 00 Xxxxxxxxx Xxxxx-Xxxxxxxx Xxxxxxxxx
X-0000 Xxxxxxxx, Xxxxxxx X-0000 Xxxxxxxxxx
Re: Residential Accredit Loans, Inc., Mortgage Asset-Backed Pass-Through Certificates, Series
2006-QO10, Class [B/SB/P], issued pursuant to the Pooling and Servicing Agreement dated as of
December 1, 2006 among RESIDENTIAL ACCREDIT LOANS, INC., RESIDENTIAL FUNDING COMPANY, LLC, and
DEUTSCHE BANK TRUST COMPANY AMERICAS, as Trustee (the "Certificates").
This is to certify that as of the date hereof and except as set forth below, the beneficial interest in
the Certificates held by you for our account is owned by persons that are not U.S. persons (as defined in Rule
901 under the Securities Act of 1933, as amended).
The undersigned undertakes to advise you promptly by tested telex on or prior to the date on which you
intend to submit your certification relating to the Certificates held by you in which the undersigned has
acquired, or intends to acquire, a beneficial interest in accordance with your operating procedures if any
applicable statement herein is not correct on such date. In the absence of any such notification, it may be
assumed that this certification applies as of such date.
[This certification excepts beneficial interests in and does not relate to U.S. $_________ principal
amount of the Certificates appearing in your books as being held for our account but that we have sold or as to
which we are not yet able to certify.]
We understand that this certification is required in connection with certain securities laws in the
United States of America. If administrative or legal proceedings are commenced or threatened in connection with
which this certification is or would be relevant, we irrevocably authorize you to produce this certification or a
copy thereof to any interested party in such proceedings.
Dated:_____________________________,*/ By: ______________________________________,
Account Holder
* Certification must be dated on or after the 15th day before the date of the Euroclear or Cedel
certificate to which this certification releases.
EXHIBIT FIVE
FORM OF CERTIFICATE TO BE GIVEN BY EUROCLEAR OR CLEARSTREAM BANKING
Deutsche Bank Trust Company Americas
Re: RESIDENTIAL ACCREDIT LOANS, INC., Mortgage Asset-Backed Pass-Through Certificates, Series
2006-QO10, Class [B/SB/P], issued Pursuant To The Pooling And Servicing Agreement Dated As Of
December 1, 2006 Among RESIDENTIAL ACCREDIT LOANS, INC., RESIDENTIAL FUNDING COMPANY, LLC, and
DEUTSCHE BANK TRUST COMPANY AMERICAS, as Trustee (The "Certificates").
This is to certify that, based solely on certifications we have received in writing, by tested telex or
by electronic transmission from member organizations appearing in our records as persons being entitled to a
portion of the principal amount set forth below (our "Member Organizations") as of the date hereof, $____________
principal amount of the Certificates is owned by persons (a) that are not U.S. persons (as defined in Rule 901
under the Securities Act of 1933. as amended (the "Securities Act")) or (b) who purchased their Certificates (or
interests therein) in a transaction or transactions that did not require registration under the Securities Act.
We further certify (a) that we are not making available herewith for exchange any portion of the related
Temporary Regulation S Global Class [B/SB/P] Certificate excepted in such certifications and (b) that as of the
date hereof we have not received any notification from any of our Member Organizations to the effect that the
statements made by them with respect to any portion of the part submitted herewith for exchange are no longer
true and cannot be relied upon as of the date hereof
We understand that this certification is required in connection with certain securities laws of the
United States of America. If administrative or legal proceedings are commenced or threatened in connection with
which this certification is or would be relevant, we irrevocably authorize you to produce this certification or a
copy hereof to any interested party in such proceedings.
Date: _____________________* Yours faithfully,
* To be dated no earlier By:_______________________________________
than the Effective Date. Xxxxxx Guaranty Trust Company of New York, Brussels Office, as
Operator of the Euroclear Clearance System
Clearstream Banking, Societe anonyme
EXHIBIT SIX
FORM OF
TRANSFER CERTIFICATE FOR EXCHANGE OR
TRANSFER FROM 144A BOOK-ENTRY CERTIFICATE
TO REGULATION S BOOK-ENTRY CERTIFICATE
Deutsche Bank Trust Company Americas
Re: RESIDENTIAL ACCREDIT LOANS, INC., Mortgage Asset-Backed Pass-Through Certificates,
Series 2006-QO10, Class [B/SB/P], Issued Pursuant To The Pooling And Servicing
Agreement Dated As Of December 1, 2006 Among RESIDENTIAL ACCREDIT LOANS, INC.,
RESIDENTIAL FUNDING COMPANY, LLC, and DEUTSCHE BANK TRUST COMPANY AMERICAS, as Trustee
(The "Certificates").
Capitalized terms used but not defined herein shall have the meanings given to them in the Agreement.
This letter relates to U.S. $____________ principal amount of Certificates that are held as a beneficial
interest in the 144A Book-Entry Certificate (CUSIP No. ________) with DTC in the name of [insert name of
transferor] (the "Transferor"). The Transferor has requested an exchange or transfer of the beneficial interest
for an interest in the Permanent Regulation S Global Class [B/SB/P] Certificate (CUSIP No. ________) to be held
with [Euroclear] [Clearstream Banking] through DTC.
In connection with the request and in receipt of the Certificates, the Transferor does hereby certify
that the exchange or transfer has been effected in accordance with the transfer restrictions set forth in the
Agreement and the Certificates and:
(a) pursuant to and in accordance with Regulation S under the Securities Act of 1933, as
amended (the "Securities Act"), and accordingly the Transferor does hereby certify that:
(i) the offer of the Certificates was not made to a person in the United States of
America,
[(ii) at the time the buy order was originated, the transferee was outside the
United States of America or the Transferor and any person acting on its behalf reasonably
believed that the transferee was outside the United States of America,
(ii) the transaction was executed in, on or through the facilities of a designated
offshore securities market and neither the Transferor nor any person acting on its behalf knows
that the transaction was pre-arranged with a buyer in the United States of America,]**/
(iii) no directed selling efforts have been made in contravention of the
requirements of Rule 903(b) or 904(b) of Regulation 5, as applicable,
(iv) the transaction is not part of a plan or scheme to evade the registration
requirements of the Securities Act, and
(b) with respect to transfers made in reliance on Rule 144 under the Securities Act, the
Transferor does hereby certify that the Certificates are being transferred in a transaction permitted by
Rule 144 under the Securities Act.
This certification and the statements contained herein are made for your benefit and the benefit of the
issuer and the [placement agent].
[Insert name of Transferor]
Date: ________________________ By: _____________________________________
Title:
** Insert one of these two provisions, which come from the definition of "offshore transactions" in
Regulation S.
EXHIBIT SEVEN
FORM OF
CERTIFICATE TO BE GIVEN BY TRANSFEREE
OF BENEFICIAL INTEREST IN A REGULATION S
BOOK-ENTRY CERTIFICATE
Euroclear Clearstream Banking, societe anonyme
000 Xxxxxxxxx Xxxxxxxx 00 Xxxxxxxxx Xxxxx-Xxxxxxxx Xxxxxxxxx
X- 0000 Xxxxxxxx, Xxxxxxx X- 0000 Xxxxxxxxxx
Re: RESIDENTIAL ACCREDIT LOANS, INC., Mortgage Asset-Backed Pass-Through Certificates,
Series 2006-QO10, Class [B/SB/P], Issued Pursuant To The Pooling And Servicing
Agreement Dated As Of December 1, 2006 Among RESIDENTIAL ACCREDIT LOANS, INC.,
RESIDENTIAL FUNDING COMPANY, LLC, and DEUTSCHE BANK TRUST COMPANY AMERICAS, as Trustee
(The "Certificates").
This is to certify that as of the date hereof, and except as set forth below, for purposes of acquiring
a beneficial interest in the Certificates, the undersigned certifies that it is not a U.S. person (as defined in
Rule 901 under the Securities Act of 1933, as amended).
The undersigned undertakes to advise you promptly by tested telex on or prior to the date on which you
intend to submit your certification relating to the Certificates held by you in which the undersigned intends to
acquire a beneficial interest in accordance with your operating procedures if any applicable statement herein is
not correct on such date. In the absence of any such notification, it may be assumed that this certification
applies as of such date.
We understand that this certification is required in connection with certain securities laws in the
United States of America. If administrative or legal proceedings are commenced or threatened in connection with
which this certification is or would be relevant, we irrevocably authorize you to produce this certification or a
copy thereof to any interested party in such proceedings.
Dated: _____________________ By: __________________________
EXHIBIT EIGHT
FORM OF
INITIAL PURCHASER EXCHANGE INSTRUCTIONS
Depository Trust Company
00 Xxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: RESIDENTIAL ACCREDIT LOANS, INC., Mortgage Asset-Backed Pass-Through Certificates,
Series 2006-QO10, Class [B/SB/P], Issued Pursuant To The Pooling And Servicing
Agreement Dated As Of December 1, 2006 Among RESIDENTIAL ACCREDIT LOANS, INC.,
RESIDENTIAL FUNDING COMPANY, LLC, and DEUTSCHE BANK TRUST COMPANY AMERICAS, as Trustee
(The "Certificates").
Pursuant to Section 5.02(g) of the Agreement, ________________________ (the "Initial Purchaser") hereby
requests that $______________ aggregate principal amount of the Certificates held by you for our account and
represented by the Temporary Regulation S Global Class [B/SB/P] Certificate (CUSIP No. ________) (as defined in
the Agreement) be exchanged for an equal principal amount represented by the Rule 144A Global Class [B/SB/P]
Certificate (CUSIP No. _______) to be held by you for our account.
Date: [Initial Purchaser]
By: ____________________________
Title:
EXHIBIT NINE-A
FORM OF
RULE 144A GLOBAL CLASS [B/SB/P] CERTIFICATE
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A CERTIFICATES AND CLASS M
CERTIFICATES AS DESCRIBED IN THE AGREEMENT (AS DEFINED HEREIN).
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.
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") COUPLED WITH THE RIGHT TO RECEIVE PAYMENTS UNDER THE YIELD MAINTENANCE
AGREEMENT AND CERTAIN OBLIGATIONS WITH RESPECT TO PAYMENTS OF BASIS RISK SHORTFALL AMOUNTS.
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 MASTER
SERVICER, THE COMPANY AND 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.
NO TRANSFER OF THIS CERTIFICATE OR INTEREST HEREIN MAY BE MADE BY A HOLDER OF THIS CERTIFICATE UNLESS
THAT TRANSFER IS MADE PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT, AND EFFECTIVE
REGISTRATION OR QUALIFICATION UNDER APPLICABLE STATE SECURITIES LAWS, OR IS MADE IN A TRANSACTION THAT DOES NOT
REQUIRE SUCH REGISTRATION OR QUALIFICATION. FURTHERMORE, THE AGREEMENT PROVIDES THAT NO TRANSFER OF THIS
CERTIFICATE OR INTEREST HEREIN MAY BE MADE BY A HOLDER OF THIS CERTIFICATE EXCEPT (I) OUTSIDE THE UNITED STATES
TO ENTITIES WHICH ARE NOT U.S. PERSONS WITHIN THE MEANING OF REGULATION S UNDER THE 1933 ACT OR (II) IN RELIANCE
ON RULE 144A UNDER THE 1933 ACT ("RULE 144A") TO A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A) THAT
IS ACQUIRING THIS CERTIFICATE OR INTEREST HEREIN FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF ANOTHER QUALIFIED
INSTITUTIONAL BUYER.
EACH HOLDER OF THIS CERTIFICATE WILL BE DEEMED TO HAVE ACKNOWLEDGED AND AGREED THAT (I) IT IS (A) A
QUALIFIED INSTITUTIONAL BUYER AND IS ACQUIRING THIS CERTIFICATE FOR ITS OWN INSTITUTIONAL ACCOUNT OR FOR THE
ACCOUNT OR ACCOUNTS OF A QUALIFIED INSTITUTIONAL BUYER, OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS
CERTIFICATE OUTSIDE THE UNITED STATES (A "REGULATION S PURCHASER"); AND (II) IT UNDERSTANDS THAT THIS CERTIFICATE
IS BEING TRANSFERRED TO IT IN A TRANSACTION NOT INVOLVING ANY PUBLIC OFFERING WITHIN THE MEANING OF THE 1933 ACT,
AND THAT, IF IN THE FUTURE IT DECIDES TO RESELL, PLEDGE OR OTHERWISE TRANSFER THIS CERTIFICATE, THIS CERTIFICATE
MAY BE RESOLD, PLEDGED OR TRANSFERRED ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AND (A) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, TO A PERSON THAT THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER THAT PURCHASES FOR ITS OWN ACCOUNT (OR FOR THE ACCOUNT OR ACCOUNTS OF A QUALIFIED
INSTITUTIONAL BUYER) AND TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, OR (B) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 OF REGULATION S.
THE HOLDER OF THIS CERTIFICATE DESIRING TO EFFECT ANY TRANSFER, SALE, PLEDGE OR OTHER DISPOSITION SHALL,
AND BY ACCEPTANCE OF THIS CERTIFICATE WILL BE DEEMED TO HAVE AGREED TO, INDEMNIFY THE TRUSTEE, THE DEPOSITOR, 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 AND THE
AGREEMENT.
CUSIP: _____________________ Certificate No. [B/SB/P]-1
Date of Pooling and Servicing Agreement Percentage Interest: 100.00%
and Cut-off Date: December 1, 2006
First Distribution Date: January 25, 2007 Aggregate Initial Principal Balance
of the Class [B/SB/P] Certificates:
$___________________________
Master Servicer: Initial Principal Balance
Residential Funding Company, LLC of this Class [B/SB/P] Certificate:
$___________________________
Maturity Date:
__________ __, 20__
MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATES
SERIES 2006-QO10
evidencing a percentage interest in the distributions allocable to the
Class [B/SB/P] Certificates with respect to a Trust Fund consisting primarily
of a pool of fixed and adjustable interest rate, first lien mortgage loans on
one- to four-family residential properties sold by RESIDENTIAL ACCREDIT LOANS,
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 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 any of their affiliates. None of the Depositor, the Master Servicer or any of their affiliates will
have any obligation with respect to any certificate or other obligation secured by or payable from payments on
the Certificates.
This certifies that CEDE & 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 adjustable interest rate, first lien mortgage loans on one- to four-family residential properties, 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 Deutsche Bank Trust
Company Americas, as trustee (the "Trustee"), a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, the capitalized terms used herein have the meanings assigned
in the Agreement. This Certificate is issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the acceptance hereof, assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be made on the 25th day of each month or, if
such 25th day is not a Business Day, the Business Day immediately following (the "Distribution Date"), commencing
as described in the Agreement, to the Person in whose name this Certificate is registered at the close of
business on the last Business Day of the month immediately preceding the month of such distribution (the "Record
Date"), from the Available Distribution Amount in an amount equal to the product of the Percentage Interest
evidenced by this Certificate and the amount of interest and principal, if any, required to be distributed to
Holders of Class [B/SB/P] Certificates on such Distribution Date.
Distributions on this Certificate will be made either by the Master Servicer acting on behalf of the
Trustee or by a Paying Agent appointed by the Trustee in immediately available funds (by wire transfer or
otherwise) for the account of the Person entitled thereto if such Person shall have so notified the Master
Servicer or such Paying Agent, or by check mailed to the address of the Person entitled thereto, as such name and
address shall appear on the Certificate Register.
Notwithstanding the above, the final distribution on this Certificate will be made after due notice of
the pendency of such distribution and only upon presentation and surrender of this Certificate at the office or
agency appointed by the Trustee for that purpose in the City and State of New York. 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/SB/P] Certificate will be made unless such transfer is exempt from the
registration requirements of the Securities Act of 1933, as amended, and any applicable state securities laws or
is made in accordance with said Act and laws. In the event that such a transfer is to be made, (i) the Trustee
or the Company may require an opinion of counsel acceptable to and in form and substance satisfactory to the
Trustee and the Company that such transfer is exempt (describing the applicable exemption and the basis therefor)
from or is being made pursuant to the registration requirements of the Securities Act of 1933, as amended, and of
any applicable statute of any state and (ii) the transferee shall execute an investment letter in the form
described by Section 5.02(e) of the Agreement. The Holder hereof desiring to effect such transfer shall, and
does hereby agree to, indemnify the Trustee, the Company, the Master Servicer and the Certificate Registrar
acting on behalf of the Trustee against any liability that may result if the transfer is not so exempt or is not
made in accordance with such Federal and state laws. In connection with any such transfer, the Trustee will also
require either (i) an opinion of counsel acceptable to and in form and substance satisfactory to the Trustee, the
Company and the Master Servicer with respect to the permissibility of such transfer under the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), and Section 4975 of the Internal Revenue Code (the "Code") and
stating, among other things, that the transferee's acquisition of a Class [B/SB/P] Certificate will not
constitute or result in a non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the
Code or (ii) a representation letter, in the form as described by Section 5.02(e) of the Agreement, either
stating that the transferee is not an employee benefit or other plan subject to the prohibited transaction
provisions of ERISA or Section 4975 of the Code (a "Plan"), or any other person (including an investment manager,
a named fiduciary or a trustee of any Plan) acting, directly or indirectly, on behalf of or purchasing any
Certificate with "plan assets" of any Plan, or stating that the transferee is an insurance company, the source of
funds to be used by it to purchase the Certificate is an "insurance company general account" (within the meaning
of Department of Labor Prohibited Transaction Class Exemption ("PTCE") 95-60), and the purchase is being made in
reliance upon the availability of the exemptive relief afforded under Sections I and III of PTCE 95-60.
This Certificate is one of a duly authorized issue of Certificates issued in several Classes designated
as Mortgage Asset-Backed Pass-Through Certificates of the Series specified hereon (herein collectively called
the "Certificates").
The Certificates are limited in right of payment to certain collections and recoveries respecting the
Mortgage Loans, all as more specifically set forth herein and in the Agreement. In the event Master Servicer
funds are advanced with respect to any Mortgage Loan, such advance is reimbursable to the Master Servicer, to the
extent provided in the Agreement, from related recoveries on such Mortgage Loan or from other cash that would
have been distributable to Certificateholders.
As provided in the Agreement, withdrawals from the Custodial Account and/or the Certificate Account
created for the benefit of Certificateholders may be made by the Master Servicer from time to time for purposes
other than distributions to Certificateholders, such purposes including without limitation reimbursement to the
Depositor and the Master Servicer of advances made, or certain expenses incurred, by either of them.
The Agreement permits, with certain exceptions therein provided, the amendment of the Agreement and the
modification of the rights and obligations of the Depositor, the Master Servicer and the Trustee and the rights
of the Certificateholders under the Agreement from time to time by the Depositor, the Master Servicer and the
Trustee with the consent of the Holders of Certificates evidencing in the aggregate not less than 66% of the
Percentage Interests of each Class of Certificates affected thereby. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future holders of this Certificate and of
any Certificate issued upon the transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon the Certificate. The Agreement also permits the amendment thereof in certain
circumstances without the consent of the Holders of any of the Certificates and, in certain additional
circumstances, without the consent of the Holders of certain Classes of Certificates.
As provided in the Agreement and subject to certain limitations therein set forth, the transfer of this
Certificate is registrable in the Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee in St. Xxxx, Minnesota, duly endorsed by, or
accompanied by an assignment in the form below or other written instrument of transfer in form satisfactory to
the Trustee and the Certificate Registrar duly executed by the Holder hereof or such 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 none of the Depositor, the Master Servicer,
the Trustee or any such agent shall be affected by notice to the contrary.
This Certificate shall be governed by and construed in accordance with the laws of the State of 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 Holder of the Class
[B/SB/P] Certificates or the Master Servicer, as described in the Agreement, from the Trust Fund of all remaining
Mortgage Loans and all property acquired in respect of such Mortgage Loans or the Certificates, in either case
thereby effecting early retirement of the Certificates. The Agreement permits, but does not require, the Holder
of the Class [B/SB/P] Certificates or the Master Servicer, as described in the Agreement, (i) to purchase, at a
price determined as provided in the Agreement, all remaining Mortgage Loans and all property acquired in respect
of any Mortgage Loan or (ii) to purchase in whole, but not in part, all of the Certificates from the Holders
thereof, provided, that any such option may only be exercised if the Stated Principal Balance before giving
effect to the distributions to be made on such Distribution Date of the Mortgage Loans, as of the Distribution
Date upon which the proceeds of any such purchase are distributed is less than ten percent of the Cut-off Date
Balance.
Unless the certificate of authentication hereon has been executed by the Certificate Registrar by manual
signature, this Certificate shall not be entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly executed.
DEUTSCHE BANK TRUST COMPANY AMERICAS,
as Trustee
By: _________________________________________________
Authorized Signatory
Dated:_____________________
CERTIFICATE OF AUTHENTICATION
This is one of the Class [B/SB/P] Certificates referred to in the within-mentioned Agreement.
DEUTSCHE BANK TRUST COMPANY AMERICAS,
as Certificate Registrar
By: _______________________________
Authorized Signatory
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
(Please print or typewrite name and address including postal zip code of assignee) the beneficial interest
evidenced by the within Trust Certificate and hereby authorizes the transfer of registration of such interest to
assignee on the Certificate Register of the Trust Fund.
I (We) further direct the Certificate Registrar to issue a new Certificate of a like denomination and
Class, to the above named assignee and deliver such Certificate to the following address:
___________________________________________________________________________________________________________________
Dated:_____________________ ____________________________________
Signature by or on behalf of assignor
___________________________________________________________________________________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately available fund
to____________________________________________________________________________
for the account of ________________________________________________________________________________________________
account number ____________________________________________________________________________________________________
or, if mailed by check, to ________________________________________________________________________________________
Applicable statements should be mailed to:________________________________________________________________
___________________________________________________________________________________________________________________
___________________________________________________________________________________________________________________
This information is provided by ___________________________________, the assignee named above, or
______________________________, as its agent.
EXHIBIT NINE-B
FORM OF
PERMANENT REGULATION S GLOBAL CLASS [B/SB/P] CERTIFICATE
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A CERTIFICATES AND CLASS M
CERTIFICATES AS DESCRIBED IN THE AGREEMENT (AS DEFINED HEREIN).
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.
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") COUPLED WITH THE RIGHT TO RECEIVE PAYMENTS UNDER THE YIELD MAINTENANCE
AGREEMENT AND CERTAIN OBLIGATIONS WITH RESPECT TO PAYMENTS OF BASIS RISK SHORTFALL AMOUNTS.
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 MASTER
SERVICER, THE COMPANY AND 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.
NO TRANSFER OF THIS CERTIFICATE OR INTEREST HEREIN MAY BE MADE BY A HOLDER OF THIS CERTIFICATE UNLESS
THAT TRANSFER IS MADE PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT, AND EFFECTIVE
REGISTRATION OR QUALIFICATION UNDER APPLICABLE STATE SECURITIES LAWS, OR IS MADE IN A TRANSACTION THAT DOES NOT
REQUIRE SUCH REGISTRATION OR QUALIFICATION. FURTHERMORE, THE AGREEMENT PROVIDES THAT NO TRANSFER OF THIS
CERTIFICATE OR INTEREST HEREIN MAY BE MADE BY A HOLDER OF THIS CERTIFICATE EXCEPT (I) OUTSIDE THE UNITED STATES
TO ENTITIES WHICH ARE NOT U.S. PERSONS WITHIN THE MEANING OF REGULATION S UNDER THE 1933 ACT OR (II) IN RELIANCE
ON RULE 144A UNDER THE 1933 ACT ("RULE 144A") TO A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A) THAT
IS ACQUIRING THIS CERTIFICATE OR INTEREST HEREIN FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF ANOTHER QUALIFIED
INSTITUTIONAL BUYER.
EACH HOLDER OF THIS CERTIFICATE WILL BE DEEMED TO HAVE ACKNOWLEDGED AND AGREED THAT (I) IT IS (A) A
QUALIFIED INSTITUTIONAL BUYER AND IS ACQUIRING THIS CERTIFICATE FOR ITS OWN INSTITUTIONAL ACCOUNT OR FOR THE
ACCOUNT OR ACCOUNTS OF A QUALIFIED INSTITUTIONAL BUYER, OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS
CERTIFICATE OUTSIDE THE UNITED STATES (A "REGULATION S PURCHASER"); (II) IT UNDERSTANDS THAT THIS CERTIFICATE IS
BEING TRANSFERRED TO IT IN A TRANSACTION NOT INVOLVING ANY PUBLIC OFFERING WITHIN THE MEANING OF THE 1933 ACT,
AND THAT, IF IN THE FUTURE IT DECIDES TO RESELL, PLEDGE OR OTHERWISE TRANSFER THIS CERTIFICATE, THIS CERTIFICATE
MAY BE RESOLD, PLEDGED OR TRANSFERRED ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AND (A) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, TO A PERSON THAT THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER THAT PURCHASES FOR ITS OWN ACCOUNT (OR FOR THE ACCOUNT OR ACCOUNTS OF A QUALIFIED
INSTITUTIONAL BUYER) AND TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, OR (B) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 OF REGULATION S; AND
(III) IF THE HOLDER IS A REGULATION S PURCHASER, IT UNDERSTANDS THAT THIS CERTIFICATE HAS NOT AND WILL NOT BE
REGISTERED UNDER THE 1933 ACT, THAT ANY OFFERS, SALES OR DELIVERIES OF THIS CERTIFICATE IN THE UNITED STATES OR
TO U.S. PERSONS PRIOR TO THE DATE THAT IS 40 DAYS AFTER THE CLOSING DATE MAY CONSTITUTE A VIOLATION OF UNITED
STATES LAW, AND THAT DISTRIBUTIONS OF PRINCIPAL AND INTEREST WILL BE MADE IN RESPECT OF SUCH CERTIFICATES ONLY
FOLLOWING THE DELIVERY BY THE HOLDER OF A CERTIFICATION OF NON-U.S. BENEFICIAL OWNERSHIP OR THE EXCHANGE OF
BENEFICIAL INTEREST IN TEMPORARY REGULATION S GLOBAL OFFERED CERTIFICATES FOR BENEFICIAL INTERESTS IN THE RELATED
PERMANENT REGULATION S GLOBAL OFFERED CERTIFICATES (WHICH IN EACH CASE WILL ITSELF REQUIRE A CERTIFICATION OF
NON-U.S. BENEFICIAL OWNERSHIP), AT THE TIMES AND IN THE MANNER SET FORTH IN THE AGREEMENT.
THE HOLDER OF THIS CERTIFICATE DESIRING TO EFFECT ANY TRANSFER, SALE, PLEDGE OR OTHER DISPOSITION SHALL,
AND BY ACCEPTANCE OF THIS CERTIFICATE WILL BE DEEMED TO HAVE AGREED TO, INDEMNIFY THE TRUSTEE, THE DEPOSITOR, 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 AND THE
AGREEMENT.
CUSIP: _____________________ Certificate No. [B/SB/P]-1
Date of Pooling and Servicing Agreement Percentage Interest: [__]%
and Cut-off Date: December 1, 2006
First Distribution Date: January 25, 2007 Aggregate Initial Principal Balance
of the Class [B/SB/P] Certificates:
$___________________________
Master Servicer: Initial Principal Balance
Residential Funding Company, LLC of this Class [B/SB/P] Certificate:
$___________________________
Maturity Date:
__________ __, 20__
MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATES
SERIES 2006-QO10
evidencing a percentage interest in the distributions allocable to the
Class [B/SB/P] Certificates with respect to a Trust Fund consisting primarily
of a pool of fixed and adjustable interest rate, first lien mortgage loans on
one- to four-family residential properties sold by RESIDENTIAL ACCREDIT LOANS,
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 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 any of their affiliates. None of the Depositor, the Master Servicer or any of their affiliates will
have any obligation with respect to any certificate or other obligation secured by or payable from payments on
the Certificates.
This certifies that CEDE & 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 adjustable interest rate, first lien mortgage loans on one- to four-family residential properties, 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 Deutsche Bank Trust
Company Americas, as trustee (the "Trustee"), a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, the capitalized terms used herein have the meanings assigned
in the Agreement. This Certificate is issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the acceptance hereof, assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be made on the 25th day of each month or, if
such 25th day is not a Business Day, the Business Day immediately following (the "Distribution Date"), commencing
as described in the Agreement, to the Person in whose name this Certificate is registered at the close of
business on the last Business Day of the month immediately preceding the month of such distribution (the "Record
Date"), from the Available Distribution Amount in an amount equal to the product of the Percentage Interest
evidenced by this Certificate and the amount of interest and principal, if any, required to be distributed to
Holders of Class [B/SB/P] Certificates on such Distribution Date.
Distributions on this Certificate will be made either by the Master Servicer acting on behalf of the
Trustee or by a Paying Agent appointed by the Trustee in immediately available funds (by wire transfer or
otherwise) for the account of the Person entitled thereto if such Person shall have so notified the Master
Servicer or such Paying Agent, or by check mailed to the address of the Person entitled thereto, as such name and
address shall appear on the Certificate Register.
Notwithstanding the above, the final distribution on this Certificate will be made after due notice of
the pendency of such distribution and only upon presentation and surrender of this Certificate at the office or
agency appointed by the Trustee for that purpose in the City and State of New York. 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/SB/P] Certificate will be made unless such transfer is exempt from the
registration requirements of the Securities Act of 1933, as amended, and any applicable state securities laws or
is made in accordance with said Act and laws. In the event that such a transfer is to be made, (i) the Trustee
or the Company may require an opinion of counsel acceptable to and in form and substance satisfactory to the
Trustee and the Company that such transfer is exempt (describing the applicable exemption and the basis therefor)
from or is being made pursuant to the registration requirements of the Securities Act of 1933, as amended, and of
any applicable statute of any state and (ii) the transferee shall execute an investment letter in the form
described by Section 5.02(e) of the Agreement. The Holder hereof desiring to effect such transfer shall, and
does hereby agree to, indemnify the Trustee, the Company, the Master Servicer and the Certificate Registrar
acting on behalf of the Trustee against any liability that may result if the transfer is not so exempt or is not
made in accordance with such Federal and state laws. In connection with any such transfer, the Trustee will also
require either (i) an opinion of counsel acceptable to and in form and substance satisfactory to the Trustee, the
Company and the Master Servicer with respect to the permissibility of such transfer under the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), and Section 4975 of the Internal Revenue Code (the "Code") and
stating, among other things, that the transferee's acquisition of a Class [B/SB/P] Certificate will not
constitute or result in a non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the
Code or (ii) a representation letter, in the form as described by Section 5.02(e) of the Agreement, either
stating that the transferee is not an employee benefit or other plan subject to the prohibited transaction
provisions of ERISA or Section 4975 of the Code (a "Plan"), or any other person (including an investment manager,
a named fiduciary or a trustee of any Plan) acting, directly or indirectly, on behalf of or purchasing any
Certificate with "plan assets" of any Plan, or stating that the transferee is an insurance company, the source of
funds to be used by it to purchase the Certificate is an "insurance company general account" (within the meaning
of Department of Labor Prohibited Transaction Class Exemption ("PTCE") 95-60), and the purchase is being made in
reliance upon the availability of the exemptive relief afforded under Sections I and III of PTCE 95-60.
This Certificate is one of a duly authorized issue of Certificates issued in several Classes designated
as Mortgage Asset-Backed Pass-Through Certificates of the Series specified hereon (herein collectively called
the "Certificates").
The Certificates are limited in right of payment to certain collections and recoveries respecting the
Mortgage Loans, all as more specifically set forth herein and in the Agreement. In the event Master Servicer
funds are advanced with respect to any Mortgage Loan, such advance is reimbursable to the Master Servicer, to the
extent provided in the Agreement, from related recoveries on such Mortgage Loan or from other cash that would
have been distributable to Certificateholders.
As provided in the Agreement, withdrawals from the Custodial Account and/or the Certificate Account
created for the benefit of Certificateholders may be made by the Master Servicer from time to time for purposes
other than distributions to Certificateholders, such purposes including without limitation reimbursement to the
Depositor and the Master Servicer of advances made, or certain expenses incurred, by either of them.
The Agreement permits, with certain exceptions therein provided, the amendment of the Agreement and the
modification of the rights and obligations of the Depositor, the Master Servicer and the Trustee and the rights
of the Certificateholders under the Agreement from time to time by the Depositor, the Master Servicer and the
Trustee with the consent of the Holders of Certificates evidencing in the aggregate not less than 66% of the
Percentage Interests of each Class of Certificates affected thereby. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future holders of this Certificate and of
any Certificate issued upon the transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon the Certificate. The Agreement also permits the amendment thereof in certain
circumstances without the consent of the Holders of any of the Certificates and, in certain additional
circumstances, without the consent of the Holders of certain Classes of Certificates.
As provided in the Agreement and subject to certain limitations therein set forth, the transfer of this
Certificate is registrable in the Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee in St. Xxxx, Minnesota, duly endorsed by, or
accompanied by an assignment in the form below or other written instrument of transfer in form satisfactory to
the Trustee and the Certificate Registrar duly executed by the Holder hereof or such 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 none of the Depositor, the Master Servicer,
the Trustee or any such agent shall be affected by notice to the contrary.
This Certificate shall be governed by and construed in accordance with the laws of the State of 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 Holder of the Class
[B/SB/P] Certificates or the Master Servicer, as described in the Agreement, from the Trust Fund of all remaining
Mortgage Loans and all property acquired in respect of such Mortgage Loans or the Certificates, in either case
thereby effecting early retirement of the Certificates. The Agreement permits, but does not require, the Holder
of the Class [B/SB/P] Certificates or the Master Servicer, as described in the Agreement, (i) to purchase, at a
price determined as provided in the Agreement, all remaining Mortgage Loans and all property acquired in respect
of any Mortgage Loan or (ii) to purchase in whole, but not in part, all of the Certificates from the Holders
thereof, provided, that any such option may only be exercised if the Stated Principal Balance before giving
effect to the distributions to be made on such Distribution Date of the Mortgage Loans, as of the Distribution
Date upon which the proceeds of any such purchase are distributed is less than ten percent of the Cut-off Date
Balance.
Unless the certificate of authentication hereon has been executed by the Certificate Registrar by manual
signature, this Certificate shall not be entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly executed.
DEUTSCHE BANK TRUST COMPANY AMERICAS,
as Trustee
By: _________________________________________________
Authorized Signatory
Dated:_____________________
CERTIFICATE OF AUTHENTICATION
This is one of the Class [B/SB/P] Certificates referred to in the within-mentioned Agreement.
DEUTSCHE BANK TRUST COMPANY AMERICAS,
as Certificate Registrar
By: _______________________________
Authorized Signatory
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
(Please print or typewrite name and address including postal zip code of assignee) the beneficial interest
evidenced by the within Trust Certificate and hereby authorizes the transfer of registration of such interest to
assignee on the Certificate Register of the Trust Fund.
I (We) further direct the Certificate Registrar to issue a new Certificate of a like denomination and
Class, to the above named assignee and deliver such Certificate to the following address:
___________________________________________________________________________________________________________________
Dated:_____________________ ____________________________________
Signature by or on behalf of assignor
___________________________________________________________________________________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately available fund
to____________________________________________________________________________
for the account of ________________________________________________________________________________________________
account number ____________________________________________________________________________________________________
or, if mailed by check, to ________________________________________________________________________________________
Applicable statements should be mailed to:________________________________________________________________
___________________________________________________________________________________________________________________
___________________________________________________________________________________________________________________
This information is provided by ___________________________________, the assignee named above, or
______________________________, as its agent
EXHIBIT NINE-C
FORM OF
TEMPORARY REGULATION S GLOBAL CLASS [B/SB/P] CERTIFICATE
THIS CERTIFICATE IS A TEMPORARY REGULATION S GLOBAL CERTIFICATE FOR PURPOSES OF REGULATION S UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"). NEITHER THIS TEMPORARY REGULATION S GLOBAL
CLASS [B/SB/P] CERTIFICATE NOR ANY INTEREST HEREIN MAY BE OFFERED, SOLD OR DELIVERED, EXCEPT AS PERMITTED UNDER
THE POOLING AND SERVICING AGREEMENT.
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.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A CERTIFICATES AND CLASS M
CERTIFICATES AS DESCRIBED IN THE AGREEMENT (AS DEFINED HEREIN).
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR INTEREST" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE") COUPLED WITH THE RIGHT TO RECEIVE PAYMENTS UNDER THE YIELD MAINTENANCE
AGREEMENT AND CERTAIN OBLIGATIONS WITH RESPECT TO PAYMENTS OF BASIS RISK SHORTFALL AMOUNTS.
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 MASTER
SERVICER, THE COMPANY AND 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.
NO TRANSFER OF THIS CERTIFICATE OR INTEREST HEREIN MAY BE MADE BY A HOLDER OF THIS CERTIFICATE UNLESS
THAT TRANSFER IS MADE PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT, AND EFFECTIVE
REGISTRATION OR QUALIFICATION UNDER APPLICABLE STATE SECURITIES LAWS, OR IS MADE IN A TRANSACTION THAT DOES NOT
REQUIRE SUCH REGISTRATION OR QUALIFICATION. FURTHERMORE, THE AGREEMENT PROVIDES THAT NO TRANSFER OF THIS
CERTIFICATE OR INTEREST HEREIN MAY BE MADE BY A HOLDER OF THIS CERTIFICATE EXCEPT (I) OUTSIDE THE UNITED STATES
TO ENTITIES WHICH ARE NOT U.S. PERSONS WITHIN THE MEANING OF REGULATION S UNDER THE 1933 ACT OR (II) IN RELIANCE
ON RULE 144A UNDER THE 1933 ACT ("RULE 144A") TO A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A) THAT
IS ACQUIRING THIS CERTIFICATE OR INTEREST HEREIN FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF ANOTHER QUALIFIED
INSTITUTIONAL BUYER.
EACH HOLDER OF THIS CERTIFICATE WILL BE DEEMED TO HAVE ACKNOWLEDGED AND AGREED THAT (I) IT IS (A) A
QUALIFIED INSTITUTIONAL BUYER AND IS ACQUIRING THIS CERTIFICATE FOR ITS OWN INSTITUTIONAL ACCOUNT OR FOR THE
ACCOUNT OR ACCOUNTS OF A QUALIFIED INSTITUTIONAL BUYER, OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS
CERTIFICATE OUTSIDE THE UNITED STATES (A "REGULATION S PURCHASER"); (II) IT UNDERSTANDS THAT THIS CERTIFICATE IS
BEING TRANSFERRED TO IT IN A TRANSACTION NOT INVOLVING ANY PUBLIC OFFERING WITHIN THE MEANING OF THE 1933 ACT,
AND THAT, IF IN THE FUTURE IT DECIDES TO RESELL, PLEDGE OR OTHERWISE TRANSFER THIS CERTIFICATE, THIS CERTIFICATE
MAY BE RESOLD, PLEDGED OR TRANSFERRED ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AND (A) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, TO A PERSON THAT THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER THAT PURCHASES FOR ITS OWN ACCOUNT (OR FOR THE ACCOUNT OR ACCOUNTS OF A QUALIFIED
INSTITUTIONAL BUYER) AND TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, OR (B) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 OF REGULATION S; AND
(III) IF THE HOLDER IS A REGULATION S PURCHASER, IT UNDERSTANDS THAT THIS CERTIFICATE HAS NOT AND WILL NOT BE
REGISTERED UNDER THE 1933 ACT, THAT ANY OFFERS, SALES OR DELIVERIES OF THIS CERTIFICATE IN THE UNITED STATES OR
TO U.S. PERSONS PRIOR TO THE DATE THAT IS 40 DAYS AFTER THE CLOSING DATE MAY CONSTITUTE A VIOLATION OF UNITED
STATES LAW, AND THAT DISTRIBUTIONS OF PRINCIPAL AND INTEREST WILL BE MADE IN RESPECT OF SUCH CERTIFICATES ONLY
FOLLOWING THE DELIVERY BY THE HOLDER OF A CERTIFICATION OF NON-U.S. BENEFICIAL OWNERSHIP OR THE EXCHANGE OF
BENEFICIAL INTEREST IN TEMPORARY REGULATION S GLOBAL OFFERED CERTIFICATES FOR BENEFICIAL INTERESTS IN THE RELATED
PERMANENT REGULATION S GLOBAL OFFERED CERTIFICATES (WHICH IN EACH CASE WILL ITSELF REQUIRE A CERTIFICATION OF
NON-U.S. BENEFICIAL OWNERSHIP), AT THE TIMES AND IN THE MANNER SET FORTH IN THE AGREEMENT.
THE HOLDER OF THIS CERTIFICATE DESIRING TO EFFECT ANY TRANSFER, SALE, PLEDGE OR OTHER DISPOSITION SHALL,
AND BY ACCEPTANCE OF THIS CERTIFICATE WILL BE DEEMED TO HAVE AGREED TO, INDEMNIFY THE TRUSTEE, THE DEPOSITOR, 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 AND THE
AGREEMENT.
CUSIP: _____________________ Certificate No. [B/SB/P]-1
Date of Pooling and Servicing Agreement Percentage Interest: [__]%
and Cut-off Date: December 1, 2006
First Distribution Date: January 25, 2007 Aggregate Initial Principal Balance
of the Class [B/SB/P] Certificates:
$___________________________
Master Servicer: Initial Principal Balance
Residential Funding Company, LLC of this Class [B/SB/P] Certificate:
$___________________________
Maturity Date:
__________ __, 20__
MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATES
SERIES 2006-QO10
evidencing a percentage interest in the distributions allocable to the
Class [B/SB/P] Certificates with respect to a Trust Fund consisting primarily
of a pool of fixed and adjustable interest rate, first lien mortgage loans
mortgage loans on one- to four-family residential properties 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 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 any of their affiliates. None of the Depositor, the Master Servicer or any of their affiliates will
have any obligation with respect to any certificate or other obligation secured by or payable from payments on
the Certificates.
This certifies that CEDE & 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 adjustable interest rate, first lien mortgage loans on one- to four-family residential properties, 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 Deutsche Bank Trust
Company Americas, as trustee (the "Trustee"), a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, the capitalized terms used herein have the meanings assigned
in the Agreement. This Certificate is issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the acceptance hereof, assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be made on the 25th day of each month or, if
such 25th day is not a Business Day, the Business Day immediately following (the "Distribution Date"), commencing
as described in the Agreement, to the Person in whose name this Certificate is registered at the close of
business on the Business Day immediately preceding that Distribution Date (the "Record Date"), from the related
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/SB/P] Certificates on such Distribution Date.
Distributions on this Certificate will be made either by the Master Servicer acting on behalf of the
Trustee or by a Paying Agent appointed by the Trustee in immediately available funds (by wire transfer or
otherwise) for the account of the Person entitled thereto if such Person shall have so notified the Master
Servicer or such Paying Agent, or by check mailed to the address of the Person entitled thereto, as such name and
address shall appear on the Certificate Register.
Notwithstanding the above, the final distribution on this Certificate will be made after due notice of
the pendency of such distribution and only upon presentation and surrender of this Certificate at the office or
agency appointed by the Trustee for that purpose in the City and State of New York. 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/SB/P] Certificate will be made unless such transfer is exempt from the
registration requirements of the Securities Act of 1933, as amended, and any applicable state securities laws or
is made in accordance with said Act and laws. In the event that such a transfer is to be made, (i) the Trustee
or the Company may require an opinion of counsel acceptable to and in form and substance satisfactory to the
Trustee and the Company that such transfer is exempt (describing the applicable exemption and the basis therefor)
from or is being made pursuant to the registration requirements of the Securities Act of 1933, as amended, and of
any applicable statute of any state and (ii) the transferee shall execute an investment letter in the form
described by Section 5.02(e) of the Agreement. The Holder hereof desiring to effect such transfer shall, and
does hereby agree to, indemnify the Trustee, the Company, the Master Servicer and the Certificate Registrar
acting on behalf of the Trustee against any liability that may result if the transfer is not so exempt or is not
made in accordance with such Federal and state laws. In connection with any such transfer, the Trustee will also
require either (i) an opinion of counsel acceptable to and in form and substance satisfactory to the Trustee, the
Company and the Master Servicer with respect to the permissibility of such transfer under the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), and Section 4975 of the Internal Revenue Code (the "Code") and
stating, among other things, that the transferee's acquisition of a Class [B/SB/P] Certificate will not
constitute or result in a non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the
Code or (ii) a representation letter, in the form as described by Section 5.02(e) of the Agreement, either
stating that the transferee is not an employee benefit or other plan subject to the prohibited transaction
provisions of ERISA or Section 4975 of the Code (a "Plan"), or any other person (including an investment manager,
a named fiduciary or a trustee of any Plan) acting, directly or indirectly, on behalf of or purchasing any
Certificate with "plan assets" of any Plan, or stating that the transferee is an insurance company, the source of
funds to be used by it to purchase the Certificate is an "insurance company general account" (within the meaning
of Department of Labor Prohibited Transaction Class Exemption ("PTCE") 95-60), and the purchase is being made in
reliance upon the availability of the exemptive relief afforded under Sections I and III of PTCE 95-60.
This Certificate is one of a duly authorized issue of Certificates issued in several Classes designated
as Mortgage Asset-Backed Pass-Through Certificates of the Series specified hereon (herein collectively called the
"Certificates").
The Certificates are limited in right of payment to certain collections and recoveries respecting the
Mortgage Loans, all as more specifically set forth herein and in the Agreement. In the event Master Servicer
funds are advanced with respect to any Mortgage Loan, such advance is reimbursable to the Master Servicer, to the
extent provided in the Agreement, from related recoveries on such Mortgage Loan or from other cash that would
have been distributable to Certificateholders.
As provided in the Agreement, withdrawals from the Custodial Account and/or the Certificate Account
created for the benefit of Certificateholders may be made by the Master Servicer from time to time for purposes
other than distributions to Certificateholders, such purposes including without limitation reimbursement to the
Depositor and the Master Servicer of advances made, or certain expenses incurred, by either of them.
The Agreement permits, with certain exceptions therein provided, the amendment of the Agreement and the
modification of the rights and obligations of the Depositor, the Master Servicer and the Trustee and the rights
of the Certificateholders under the Agreement from time to time by the Depositor, the Master Servicer and the
Trustee with the consent of the Holders of Certificates evidencing in the aggregate not less than 66% of the
Percentage Interests of each Class of Certificates affected thereby. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future holders of this Certificate and of
any Certificate issued upon the transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon the Certificate. The Agreement also permits the amendment thereof in certain
circumstances without the consent of the Holders of any of the Certificates and, in certain additional
circumstances, without the consent of the Holders of certain Classes of Certificates.
As provided in the Agreement and subject to certain limitations therein set forth, the transfer of this
Certificate is registrable in the Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee in St. Xxxx, Minnesota, duly endorsed by, or
accompanied by an assignment in the form below or other written instrument of transfer in form satisfactory to
the Trustee and the Certificate Registrar duly executed by the Holder hereof or such 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 none of the Depositor, the Master Servicer,
the Trustee or any such agent shall be affected by notice to the contrary.
This Certificate shall be governed by and construed in accordance with the laws of the State of 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 Holder of the Class
[B/SB/P] Certificates or the Master Servicer, as described in the Agreement, from the Trust Fund of all remaining
Mortgage Loans and all property acquired in respect of such Mortgage Loans or the Certificates, in either case
thereby effecting early retirement of the Certificates. The Agreement permits, but does not require the Holder
of the Class [B/SB/P] Certificates or the Master Servicer, as described in the Agreement, (i) to purchase, at a
price determined as provided in the Agreement, all remaining Mortgage Loans and all property acquired in respect
of any Mortgage Loan or (ii) to purchase in whole, but not in part, all of the Certificates from the Holders
thereof, provided, that any such option may only be exercised if the Stated Principal Balance before giving
effect to the distributions to be made on such Distribution Date of the Mortgage Loans, as of the Distribution
Date upon which the proceeds of any such purchase are distributed is less than ten percent of the Cut-off Date
Balance.
Unless the certificate of authentication hereon has been executed by the Certificate Registrar by manual
signature, this Certificate shall not be entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly executed.
DEUTSCHE BANK TRUST COMPANY AMERICAS,
as Trustee
By: _________________________________________________
Authorized Signatory
Dated: May 30, 2006
CERTIFICATE OF AUTHENTICATION
This is one of the Class [B/SB/P] Certificates referred to in the within-mentioned Agreement.
DEUTSCHE BANK TRUST COMPANY AMERICAS,
as Certificate Registrar
By: _______________________________
Authorized Signatory
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
(Please print or typewrite name and address including postal zip code of assignee) the beneficial interest
evidenced by the within Trust Certificate and hereby authorizes the transfer of registration of such interest to
assignee on the Certificate Register of the Trust Fund.
I (We) further direct the Certificate Registrar to issue a new Certificate of a like denomination and
Class, to the above named assignee and deliver such Certificate to the following address:
___________________________________________________________________________________________________________________
Dated:_____________________ ____________________________________
Signature by or on behalf of assignor
___________________________________________________________________________________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately available fund
to____________________________________________________________________________
for the account of ________________________________________________________________________________________________
account number ____________________________________________________________________________________________________
or, if mailed by check, to ________________________________________________________________________________________
Applicable statements should be mailed to:________________________________________________________________
___________________________________________________________________________________________________________________
___________________________________________________________________________________________________________________
This information is provided by ___________________________________, the assignee named above, or
______________________________, as its agent.
SCHEDULE 1
---------------------- ----------------------------- ----------------------------------
COLUMN A: SCHEDULED AMOUNT OF
PERIOD DISTRIBUTION DATE 40-YEAR MORTGAGE LOANS ($)
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
121 01/25/17 41,560,635.36
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
122 02/25/17 40,934,505.32
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
123 03/25/17 40,317,612.14
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
124 04/25/17 39,709,821.01
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
125 05/25/17 39,110,999.07
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
126 06/25/17 38,521,015.37
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
127 07/25/17 37,939,740.89
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
128 08/25/17 37,367,048.47
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
129 09/25/17 36,802,812.80
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
130 10/25/17 36,246,910.38
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
131 11/25/17 35,699,219.51
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
132 12/25/17 35,159,620.26
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
133 01/25/18 34,627,994.43
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
134 02/25/18 34,104,225.55
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
135 03/25/18 33,588,198.83
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
136 04/25/18 33,079,801.16
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
137 05/25/18 32,578,921.05
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
138 06/25/18 32,085,448.66
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
139 07/25/18 31,599,275.72
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
140 08/25/18 31,120,295.55
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
141 09/25/18 30,648,403.00
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
142 10/25/18 30,183,494.47
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
143 11/25/18 29,725,467.84
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
144 12/25/18 29,274,222.50
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
145 01/25/19 28,829,659.29
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
146 02/25/19 28,391,680.48
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
147 03/25/19 27,960,189.77
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
148 04/25/19 27,535,092.27
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
149 05/25/19 27,116,294.44
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
150 06/25/19 26,703,704.14
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
151 07/25/19 26,297,230.52
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
152 08/25/19 25,896,784.10
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
153 09/25/19 25,502,276.66
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
154 10/25/19 25,113,621.30
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
155 11/25/19 24,730,732.34
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
156 12/25/19 24,353,525.37
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
157 01/25/20 23,981,917.22
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
158 02/25/20 23,615,825.90
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
159 03/25/20 23,255,170.64
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
160 04/25/20 22,899,871.82
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
161 05/25/20 22,549,850.99
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
162 06/25/20 22,205,030.83
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
163 07/25/20 21,865,335.18
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
164 08/25/20 21,530,688.93
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
165 09/25/20 21,201,018.11
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
166 10/25/20 20,876,249.81
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
167 11/25/20 20,556,312.17
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
168 12/25/20 20,241,134.40
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
169 01/25/21 19,930,646.71
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
170 02/25/21 19,624,780.34
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
171 03/25/21 19,323,467.54
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
172 04/25/21 19,026,641.53
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
173 05/25/21 18,734,236.51
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
174 06/25/21 18,446,187.64
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
175 07/25/21 18,162,431.00
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
176 08/25/21 17,882,903.64
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
177 09/25/21 17,607,543.50
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
178 10/25/21 17,336,289.42
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
179 11/25/21 17,069,081.15
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
180 12/25/21 16,805,859.30
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
181 01/25/22 16,546,565.35
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
182 02/25/22 16,291,141.63
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
183 03/25/22 16,039,531.31
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
184 04/25/22 15,791,678.40
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
185 05/25/22 15,547,527.71
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
186 06/25/22 15,307,024.86
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
187 07/25/22 15,070,116.25
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
188 08/25/22 14,836,749.08
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
189 09/25/22 14,606,871.30
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
190 10/25/22 14,380,431.64
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
191 11/25/22 14,157,379.57
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
192 12/25/22 13,937,665.27
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
193 01/25/23 13,721,239.69
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
194 02/25/23 13,508,054.45
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
195 03/25/23 13,298,061.91
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
196 04/25/23 13,091,215.11
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
197 05/25/23 12,887,467.77
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
198 06/25/23 12,686,774.30
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
199 07/25/23 12,489,089.75
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
200 08/25/23 12,294,369.84
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
201 09/25/23 12,102,570.95
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
202 10/25/23 11,913,650.07
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
203 11/25/23 11,727,564.82
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
204 12/25/23 11,544,273.47
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
205 01/25/24 11,363,734.84
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
206 02/25/24 11,185,908.42
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
207 03/25/24 11,010,754.23
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
208 04/25/24 10,838,232.91
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
209 05/25/24 10,668,305.66
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
210 06/25/24 10,500,934.25
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
211 07/25/24 10,336,081.00
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
212 08/25/24 10,173,708.79
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
213 09/25/24 10,013,781.05
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
214 10/25/24 9,856,261.71
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
215 11/25/24 9,701,115.26
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
216 12/25/24 9,548,306.70
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
217 01/25/25 9,397,801.52
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
218 02/25/25 9,249,565.75
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
219 03/25/25 9,103,565.89
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
220 04/25/25 8,959,768.92
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
221 05/25/25 8,818,142.34
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
222 06/25/25 8,678,654.10
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
223 07/25/25 8,541,272.60
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
224 08/25/25 8,405,966.74
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
225 09/25/25 8,272,705.85
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
226 10/25/25 8,141,459.72
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
227 11/25/25 8,012,198.56
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
228 12/25/25 7,884,893.04
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
229 01/25/26 7,759,514.25
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
230 02/25/26 7,636,033.71
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
231 03/25/26 7,514,423.33
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---------------------- ----------------------------- ----------------------------------
232 04/25/26 7,394,655.45
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
233 05/25/26 7,276,702.82
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
234 06/25/26 7,160,538.58
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---------------------- ----------------------------- ----------------------------------
235 07/25/26 7,046,136.26
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
236 08/25/26 6,933,469.78
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
237 09/25/26 6,822,513.45
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
238 10/25/26 6,713,241.93
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---------------------- ----------------------------- ----------------------------------
239 11/25/26 6,605,630.28
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
240 12/25/26 6,499,653.92
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
241 01/25/27 6,395,288.60
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
242 02/25/27 6,292,510.46
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
243 03/25/27 6,191,295.98
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
244 04/25/27 6,091,621.97
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
245 05/25/27 5,993,465.59
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
246 06/25/27 5,896,804.34
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
247 07/25/27 5,801,616.04
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
248 08/25/27 5,707,878.84
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
249 09/25/27 5,615,571.20
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
250 10/25/27 5,524,671.91
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
251 11/25/27 5,435,160.05
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
252 12/25/27 5,347,015.04
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
253 01/25/28 5,260,216.56
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
254 02/25/28 5,174,744.63
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
255 03/25/28 5,090,579.52
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
256 04/25/28 5,007,701.82
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
257 05/25/28 4,926,092.40
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
258 06/25/28 4,845,732.39
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
259 07/25/28 4,766,603.22
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
260 08/25/28 4,688,686.59
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
261 09/25/28 4,611,964.45
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
262 10/25/28 4,536,419.03
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
263 11/25/28 4,462,032.82
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
264 12/25/28 4,388,788.56
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
265 01/25/29 4,316,669.25
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
266 02/25/29 4,245,658.13
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
267 03/25/29 4,175,738.69
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
268 04/25/29 4,106,894.68
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
269 05/25/29 4,039,110.05
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
270 06/25/29 3,972,369.03
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
271 07/25/29 3,906,656.04
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
272 08/25/29 3,841,955.75
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
273 09/25/29 3,778,253.07
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
274 10/25/29 3,715,533.10
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
275 11/25/29 3,653,781.17
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
276 12/25/29 3,592,982.84
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
277 01/25/30 3,533,123.86
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
278 02/25/30 3,474,190.21
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
279 03/25/30 3,416,168.06
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
280 04/25/30 3,359,043.79
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
281 05/25/30 3,302,803.97
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
282 06/25/30 3,247,435.39
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
283 07/25/30 3,192,925.01
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
284 08/25/30 3,139,260.01
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
285 09/25/30 3,086,427.71
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
286 10/25/30 3,034,415.68
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
287 11/25/30 2,983,211.61
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
288 12/25/30 2,932,803.43
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
289 01/25/31 2,883,179.19
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
290 02/25/31 2,834,327.16
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
291 03/25/31 2,786,235.77
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
292 04/25/31 2,738,893.61
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
293 05/25/31 2,692,289.44
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
294 06/25/31 2,646,412.20
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
295 07/25/31 2,601,250.98
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
296 08/25/31 2,556,795.03
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
297 09/25/31 2,513,033.77
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
298 10/25/31 2,469,956.76
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
299 11/25/31 2,427,553.72
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
300 12/25/31 2,385,814.53
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
301 01/25/32 2,344,729.21
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
302 02/25/32 2,304,287.92
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
303 03/25/32 2,264,480.99
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
304 04/25/32 2,225,298.87
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
305 05/25/32 2,186,732.15
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
306 06/25/32 2,148,771.58
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
307 07/25/32 2,111,408.02
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
308 08/25/32 2,074,632.48
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
309 09/25/32 2,038,436.10
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
310 10/25/32 2,002,810.16
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
311 11/25/32 1,967,746.05
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
312 12/25/32 1,933,235.30
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
313 01/25/33 1,899,269.56
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
314 02/25/33 1,865,840.60
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
315 03/25/33 1,832,940.33
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
316 04/25/33 1,800,560.75
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
317 05/25/33 1,768,694.01
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
318 06/25/33 1,737,332.34
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
319 07/25/33 1,706,468.12
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
320 08/25/33 1,676,093.82
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
321 09/25/33 1,646,202.04
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
322 10/25/33 1,616,785.46
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
323 11/25/33 1,587,836.90
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
324 12/25/33 1,559,349.26
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
325 01/25/34 1,531,315.57
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
326 02/25/34 1,503,728.95
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
327 03/25/34 1,476,582.61
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
328 04/25/34 1,449,869.89
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
329 05/25/34 1,423,584.19
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
330 06/25/34 1,397,719.05
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
331 07/25/34 1,372,268.07
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
332 08/25/34 1,347,224.97
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
333 09/25/34 1,322,583.55
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
334 10/25/34 1,298,337.69
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
335 11/25/34 1,274,481.40
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
336 12/25/34 1,251,008.73
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
337 01/25/35 1,227,913.86
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
338 02/25/35 1,205,191.03
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
339 03/25/35 1,182,834.57
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
340 04/25/35 1,160,838.91
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
341 05/25/35 1,139,198.53
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
342 06/25/35 1,117,908.04
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
343 07/25/35 1,096,962.08
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
344 08/25/35 1,076,355.40
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
345 09/25/35 1,056,082.82
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
346 10/25/35 1,036,139.23
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
347 11/25/35 1,016,519.62
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
348 12/25/35 997,219.02
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
349 01/25/36 978,232.55
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
350 02/25/36 959,555.42
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
351 03/25/36 941,182.88
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
352 04/25/36 923,110.28
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
353 05/25/36 905,333.00
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
354 06/25/36 887,846.54
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
355 07/25/36 870,646.42
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
356 08/25/36 853,728.26
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
357 09/25/36 837,087.72
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
358 10/25/36 820,720.55
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
359 11/25/36 804,622.55
---------------------- ----------------------------- ----------------------------------
---------------------- ----------------------------- ----------------------------------
360 12/25/36 788,789.56
---------------------- ----------------------------- ----------------------------------
