DATE: February 23, 2007
TO: U.S. Bank National Association, not in its individual capacity
but solely as supplemental interest trust trustee for the
benefit of RASC Series 2007-KS2 Supplemental Interest Trust,
acting on behalf of the Class A Certificateholders and Class M
Certificateholders under the Pooling and Servicing Agreement
identified below ("PARTY A")
ATTENTION: RASC Series 2007-KS2
FROM: U.S. Bank National Association, not in its individual capacity
but solely as supplemental interest trust trustee for the
benefit of RASC Series 2007-KS2 Supplemental Interest Trust,
acting on behalf of the Class SB Certificateholders under the
Pooling and Servicing Agreement identified below ("PARTY B")
SUBJECT: Payment Swap Confirmation and Agreement
REFERENCE NUMBER
The purpose of this letter agreement (the "Agreement") is to confirm the terms and conditions of the Transaction
entered into on the Trade Date specified below (the "Transaction") between Party A and Party B. This Agreement,
which evidences a complete and binding agreement between you and us to enter into the Transaction on the terms
set forth below, constitutes a "Confirmation" as referred to in the ISDA Form Master Agreement (as defined
below), as well as a "Schedule" as referred to in the ISDA Form Master Agreement.
1. This Agreement is subject to and incorporates the 2000 ISDA Definitions (the "Definitions"), as
published by the International Swaps and Derivatives Association, Inc. ("ISDA"). You and we have agreed to enter
into this Agreement in lieu of negotiating a Schedule to the 1992 ISDA Master Agreement (Multicurrency-Cross
Border) form (the "ISDA Form Master Agreement") but, rather, an ISDA Form Master Agreement shall be deemed to
have been executed by you and us on the date we entered into the Transaction. In the event of any inconsistency
between the provisions of this Agreement and the Definitions or the ISDA Form Master Agreement, this Agreement
shall prevail for purposes of the Transaction. Terms used and not otherwise defined herein, in the ISDA Form
Master Agreement or the Definitions shall have the meanings assigned to them in the Pooling and Servicing
Agreement, dated as of February 23, 2007, among Residential Asset Securities Corporation, as depositor,
Residential Funding Company, LLC, as master servicer, and U.S. Bank National Association, as trustee and
supplemental interest trust trustee (the "Pooling and Servicing Agreement"). Each reference to a "Section" or to
a "Section" "of this Agreement" will be construed as a reference to a Section of the 1992 ISDA Form Master
Agreement. Each capitalized term used herein that is not defined herein or in the 1992 ISDA Form Master
Agreement shall have the meaning defined in the Pooling and Servicing Agreement. Notwithstanding anything herein
to the contrary, should any provision of this Agreement conflict with any provision of the Pooling and Servicing
Agreement, the provision of the Pooling and Servicing Agreement shall apply.
2. The terms of the particular Transaction to which this Confirmation relates are as follows:
Trade Date:
Effective Date:
Termination Date: February 25, 2037 subject to adjustment in accordance with the
Business Day Convention.
Business Days: California, Minnesota, Texas, New York, Illinois.
Business Day Convention: Following.
PARTY A PAYMENTS:
Party A Payment Dates: Each Distribution Date under the Pooling and Servicing
Agreement.
Party A Payment Amounts: On each Party A Payment Date, the amount, if any, equal to the
aggregate amount of Net Swap Payments and Swap Termination
Payments owed to the Swap Counterparty remaining unpaid after
application of the sum of (A) from the Adjusted Available
Distribution Amount that would have remained had the Adjusted
Available Distribution Amount been applied on such
Distribution Date to make the distributions for such
Distribution Date under Section 4.02(c) clauses (i) through
(x) of the Pooling and Servicing Agreement, the sum of (I)
Accrued Certificate Interest on the Class SB Certificates,
(II) the amount of any Overcollateralization Reduction Amount
and (III) for each Distribution Date after the Certificate
Principal Balance of each Class of Class A Certificates and
Class M Certificates has been reduced to zero, the
Overcollateralization Amount, (B) from prepayment charges on
deposit in the Certificate Amount, any prepayment charges
received on the Mortgage Loans during the related Prepayment
Period and (C) the amount distributable with respect to
REMIC IV Regular Interest IO.
PARTY B PAYMENTS:
Party B Payment Dates: Each Distribution Date under the Pooling and Servicing
Agreement
Party B Payment Amounts: On each Party B Payment Date, an amount equal to the lesser of
(a) the Available Distribution Amount remaining on such
Distribution Date after the distributions on such Distribution
Date under Section 4.02(c) clauses (i) through (vi) of the
Pooling and Servicing Agreement and (b) the aggregate unpaid
Basis Risk Shortfalls allocated to the Class A
Certificateholders and the Class M Certificateholders for such
Distribution Date.
3. Additional Provisions: Each party hereto is hereby advised and acknowledges that the other party has
engaged in (or refrained from engaging in) substantial financial transactions and has taken (or refrained from
taking) other material actions in reliance upon the entry by the parties into the Transaction being entered into
on the terms and conditions set forth herein and in the ISDA Form Master Agreement relating to such Transaction,
as applicable.
4. Provisions Deemed Incorporated in a Schedule to the ISDA Form Master Agreement:
1) Termination Provisions. For purposes of the ISDA Form Master Agreement:
(a) "Specified Entity" is not applicable to Party A or Party B for any purpose.
(b) "Specified Transaction" is not applicable to Party A or Party B for any purpose, and, accordingly,
Section 5(a)(v) shall not apply to Party A or Party B.
(c) The "Cross Default" provisions of Section 5(a)(vi) shall not apply to Party A or Party B.
(d) The "Credit Event Upon Merger" provisions of Section 5(b)(iv) will not apply to Party A or Party B.
(e) With respect to Party A and Party B, the "Bankruptcy" provision of Section 5(a)(vii)(2) of the ISDA Form
Master Agreement will be deleted in its entirety.
(f) The "Automatic Early Termination" provision of Section 6(a) will not apply to Party A or to Party B.
(g) Payments on Early Termination. For the purpose of Section 6(e) of the ISDA Form Master Agreement:
(i) Market Quotation will apply.
(ii) The Second Method will apply.
(h) "Termination Currency" means United States Dollars.
(i) The provisions of Sections 5(a)(ii), 5(a)(iii) and 5(a)(iv) shall not apply to Party A or Party B.
(j) Tax Event. The provisions of Section 2(d)(i)(4) and 2(d)(ii) of the ISDA Form Master Agreement shall not
apply to Party A and Party A shall not be required to pay any additional amounts referred to
therein.
2) Tax Representations.
(a) Payer Representations. For the purpose of Section 3(e) of the ISDA Form Master Agreement, each of Party
A and Party B will make the following representations:
It is not required by any applicable law, as modified by the practice
of any relevant governmental revenue authority, of any Relevant
Jurisdiction to make any deduction or withholding for or on account
of any Tax from any payment (other than interest under Section 2(e),
6(d)(ii) or 6(e) of the ISDA Form Master Agreement) to be made by it
to the other party under this Agreement. In making this
representation, it may rely on:
(i) the accuracy of any representations made by the other party pursuant to Section 3(f) of the ISDA Form
Master Agreement;
(ii) the satisfaction of the agreement contained in Sections 4(a)(i) or 4(a)(iii) of the ISDA Form Master
Agreement and the accuracy and effectiveness of any document provided by the other
party pursuant to Sections 4(a)(i) or 4(a)(iii) of the ISDA Form Master Agreement; and
(iii) the satisfaction of the agreement of the other party contained in Section 4(d) of the ISDA Form Master
Agreement, provided that it shall not be a breach of this representation where
reliance is placed on clause (ii) and the other party does not deliver a form or
document under Section 4(a)(iii) by reason of material prejudice to its legal or
commercial position.
(b) Payee Representations. For the purpose of Section 3(f) of the ISDA Form Master Agreement, Party A and
Party B make the following representations: None
3) Documents to be Delivered. For the purpose of Section 4(a) (i) and 4(a) (iii):
(1) Tax forms, documents, or certificates to be delivered are:
PARTY REQUIRED TO FORM/DOCUMENT/ DATE BY WHICH TO
DELIVER DOCUMENT CERTIFICATE BE DELIVERED
Party A and Party B Any documents required or Promptly after the earlier of (i) reasonable
reasonably requested to allow demand by either party or (ii) learning that such
the other party to make form or document is required
payments under this Agreement
without any deduction or
withholding for or on the
account of any Tax or with
such deduction or withholding
at a reduced rate
(2) Other documents to be delivered are:
PARTY REQUIRED FORM/DOCUMENT/ DATE BY WHICH TO BE COVERED BY
TO DELIVER CERTIFICATE DELIVERED SECTION 3(D)
DOCUMENT REPRESENTATION
Party A and Party B Any documents required by the Upon execution and Yes
receiving party to evidence the delivery of this
authority of the delivering party Agreement and such
for it to execute and deliver this Confirmation
Agreement, any Confirmation to
which it is a party, and to
evidence the authority of the
delivering party to perform its
obligations under this Agreement
and such Confirmation.
Party A and Party B A certificate of an authorized Upon the execution Yes
officer of the party, as to the and delivery of this
incumbency and authority of the Agreement and such
respective officers of the party Confirmation
signing this Agreement
4) Miscellaneous. Miscellaneous
(a) Address for Notices: For the purposes of Section 12(a) of this Agreement:
Address for notices or communications to Party A:
Address: RASC Series 2007-KS2 Supplemental Interest Trust
c/o U.S. Bank National Association
00 Xxxxxxxxxx Xxxxxx
XX-XX-XX0X
Xx. Xxxx, Xxxxxxxxx 00000
with a copy to: Residential Funding Company, LLC
0000 Xxxxxxxxxx Xxxx Xxxx., Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxx Xxxxxxxx
Facsimile: (000) 000-0000
(For all purposes)
Address for notices or communications to Party B:
Address: RASC Series 2007-KS2 Supplemental Interest Trust
c/o U.S. Bank National Association
00 Xxxxxxxxxx Xxxxxx
XX-XX-XX0X
Xx. Xxxx, Xxxxxxxxx 00000
with a copy to: Residential Funding Company, LLC
0000 Xxxxxxxxxx Xxxx Xxxx., Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxx Xxxxxxxx
Facsimile No.: (000) 000-0000
(For all purposes)
(b) Process Agent. For the purpose of Section 13(c):
Party A: Not Applicable
Party B: Not Applicable
(c) Offices. The provisions of Section 10(a) will not apply to this Agreement; neither Party A nor Party B
have any Offices other than as set forth in the Notices Section.
(d) Multibranch Party. For the purpose of Section 10(c) of the ISDA Form Master Agreement, neither Party A
nor Party B is a Multibranch. Party.
(e) Calculation Agent. The Calculation Agent is Residential Funding Company, LLC.
(f) Credit Support Document.
Not Applicable
(g) Credit Support Provider.
Not Applicable
(h) Governing Law. The parties to this ISDA Agreement hereby agree that the law of the State of New York
shall govern their rights and duties in whole, without regard to the conflict of law provision
thereof, other than New York General Obligations Law Sections 5-1401 and 5-1402.
(i) Non-Petition. Party A and Party B each hereby irrevocably and unconditionally agrees that it will not
institute against, or join any other person in instituting against or cause any other person to
institute against RASC Series 2007-KS2 Supplemental Interest Trust, Mortgage Asset-Backed
Pass-Through Certificates, Series 2007-KS2, or the other party any bankruptcy, reorganization,
arrangement, insolvency, or similar proceeding under the laws of the United States, or any
other jurisdiction for the non-payment of any amount due hereunder or any other reason until
the payment in full of the Certificates and the expiration of a period of one year plus ten
days (or, if longer, the applicable preference period) following such payment.
(j) Severability. If any term, provision, covenant, or condition of this Agreement, or the application
thereof to any party or circumstance, shall be held to be invalid or unenforceable (in whole or
in part) for any reason, the remaining terms, provisions, covenants, and conditions hereof
shall continue in full force and effect as if this Agreement had been executed with the invalid
or unenforceable portion eliminated, so long as this Agreement as so modified continues to
express, without material change, the original intentions of the parties as to the subject
matter of this Agreement and the deletion of such portion of this Agreement will not
substantially impair the respective benefits or expectations of the parties.
The parties shall endeavor to engage in good faith negotiations to replace any invalid
or unenforceable term, provision, covenant or condition with a valid or enforceable term,
provision, covenant or condition, the economic effect of which comes as close as possible to
that of the invalid or unenforceable term, provision, covenant or condition.
(k) [Intentionally Omitted].
(l) Waiver of Jury Trial. Each party to this Agreement respectively waives any right it may have to a trial
by jury in respect of any Proceedings relating to this Agreement or any Credit Support Document.
(m) Set-Off. Notwithstanding any provision of this Agreement or any other existing or future agreement,
each party irrevocably waives any and all rights it may have to set off, net, recoup or
otherwise withhold or suspend or condition payment or performance of any obligation between it
and the other party hereunder against any obligation between it and the other party under any
other agreements. The provisions for Set-off set forth in Section 6(e) of the ISDA Form Master
Agreement shall not apply for purposes of this Transaction.
(n) This Agreement may be executed in several counterparts, each of which shall be deemed an original but
all of which together shall constitute one and the same instrument.
(o) Supplemental Interest Trustee Liability Limitations. It is expressly understood and agreed by the
parties hereto that (a) this Agreement is executed and delivered by U.S. Bank National
Association, not individually or personally but solely as Supplemental Interest Trustee of
Party A and Party B, in the exercise of the powers and authority conferred and vested in it and
that U.S. Bank National Association shall perform its duties and obligations hereunder in
accordance with the standard of care set forth in Article VIII of the Pooling and Servicing
Agreement, (b) each of the representations, undertakings and agreements herein made on the part
of Party A and Party B is made and intended not as personal representations, undertakings and
agreements by U.S. Bank National Association but is made and intended for the purpose of
binding only Party A and Party B, (c) nothing herein contained shall be construed as creating
any liability on U.S. Bank National Association, individually or personally, to perform any
covenant either expressed or implied contained herein, all such liability, if any, being
expressly waived by the parties hereto and by any Person claiming by, through or under the
parties hereto; provided that nothing in this paragraph shall relieve U.S. Bank National
Association from performing its duties and obligations hereunder and under the Pooling and
Servicing Agreement in accordance with the standard of care set forth therein, and (d) under no
circumstances shall U.S. Bank National Association be personally liable for the payment of any
indebtedness or expenses of Party A or Party B or be liable for the breach or failure of any
obligation, representation, warranty or covenant made or undertaken by Party A or Party B under
this Agreement or any other related documents; provided, that nothing in this paragraph shall
relieve U.S. Bank National Association from performing its duties and obligations hereunder and
under the Pooling and Servicing Agreement in accordance with the standard of care set forth
herein and therein.
5) "Affiliate". Party A and Party B shall be deemed to not have any Affiliates for purposes of this
Agreement, including for purposes of Section 6(b)(ii).
6) Section 3 of the ISDA Form Master Agreement is hereby amended by adding at the end thereof the following
subsection (g):
"(g) Relationship Between Parties.
Each party represents to the other party on each date when it enters into a Transaction that:--
(1) Nonreliance. (i) It is not relying on any statement or representation of the other party regarding the
Transaction (whether written or oral), other than the representations expressly made in this Agreement or the
Confirmation in respect of that Transaction and (ii) it has consulted with its own legal, regulatory, tax,
business, investment, financial and accounting advisors to the extent it has deemed necessary, and it has made
its own investment, hedging and trading decisions based upon its own judgment and upon any advice from such
advisors as it has deemed necessary and not upon any view expressed by the other party.
(2) Evaluation and Understanding.
(i) It has the capacity to evaluate (internally or through independent professional advice) the Transaction
and has made its own decision to enter into the Transaction and has been directed by the Pooling and Servicing
Agreement to enter into this Transaction; and
(ii) It understands the terms, conditions and risks of the Transaction and is willing and able to accept
those terms and conditions and to assume those risks, financially and otherwise.
(3) Purpose. It is entering into the Transaction for the purposes of managing its borrowings or investments,
hedging its underlying assets or liabilities or in connection with a line of business.
(4) Status of Parties. The other party is not acting as agent, fiduciary or advisor for it in respect of the
Transaction.
(5) Eligible Contract Participant. It is an "eligible swap participant" as such term is defined in Section
35.1(b)(2) of the regulations (17 C.F.R 35) promulgated under, and it constitutes an "eligible contract
participant" as such term is defined in Section 1(a)12 of the Commodity Exchange Act, as amended."
7) Account Details and Settlement Information:
PAYMENTS TO PARTY A:
Payments to Party A shall be made in the same manner as
provided for in the Pooling and Servicing Agreement with
respect to the Class A Certificateholders and Class M
Certificateholders.
PAYMENTS TO PARTY B:
Payments to Party B shall be made in the same manner as
provided for in the Pooling and Servicing Agreement with
respect to the Class SB Certificateholders.
Please sign and return to us a copy of this Agreement.
Very truly yours,
U.S. BANK NATIONAL ASSOCIATION, not in its individual
capacity but solely as supplemental interest trust trustee
for the benefit of RASC Series 2007-KS2 Supplemental
Interest Trust, acting on behalf of the Class SB
Certificateholders
By: _________________________________________
Name:
Title:
AGREED AND ACCEPTED AS OF THE TRADE DATE
U.S. BANK NATIONAL ASSOCIATION, not in its individual
capacity but solely as supplemental interest trust trustee
for the benefit of RASC Series 2007-KS2 Supplemental
Interest Trust, acting on behalf of the Class A
Certificateholders and Class M Certificateholders
By: ________________________________________
Name:
Title:
