CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.,
Depositor,
DLJ MORTGAGE CAPITAL, INC.,
Seller,
XXXXX FARGO BANK, N.A.,
Master Servicer, Servicer and Trust Administrator,
SELECT PORTFOLIO SERVICING, INC.,
Servicer, Special Servicer and Modification Oversight Agent,
WASHINGTON MUTUAL MORTGAGE SECURITIES CORP.
Servicer,
and
U.S. BANK NATIONAL ASSOCIATION
Trustee
SERIES SUPPLEMENT
DATED AS OF FEBRUARY 1, 2007
TO
STANDARD TERMS OF POOLING AND SERVICING AGREEMENT
DATED AS OF FEBRUARY 1, 2007
relating to
ADJUSTABLE RATE MORTGAGE TRUST 2007-1
ADJUSTABLE RATE MORTGAGE-BACKED PASS-THROUGH CERTIFICATES,
SERIES 2007-1
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS.............................................................................................9
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES..........................................40
SECTION 2.01. Conveyance of Trust Fund..............................................................40
SECTION 2.02. Acceptance by the Trustee.............................................................40
SECTION 2.03. Representations and Warranties of the Seller, Master Servicer and Servicers...........41
SECTION 2.04. Representations and Warranties of the Depositor as to the Mortgage Loans..............41
SECTION 2.05. Delivery of Opinion of Counsel in Connection with Substitutions.......................41
SECTION 2.06. Issuance of Certificates..............................................................41
SECTION 2.07. REMIC Provisions......................................................................41
SECTION 2.08. Covenants of the Master Servicer and each Servicer....................................46
ARTICLE III ADMINISTRATION AND SERVICING OF MORTGAGE LOANS.......................................................46
ARTICLE IV PAYMENTS AND STATEMENTS TO CERTIFICATEHOLDERS.........................................................46
SECTION 4.01. Priorities of Distribution............................................................47
SECTION 4.02. Allocation of Losses..................................................................57
SECTION 4.03. Recoveries............................................................................59
SECTION 4.04. Monthly Statements to Certificateholders..............................................59
SECTION 4.05. Servicer to Cooperate.................................................................59
SECTION 4.06. Cross-Collateralization; Adjustments to Available Funds...............................60
SECTION 4.07. Group 5 Interest Rate Cap Account.....................................................60
SECTION 4.08. Supplemental Interest Trust(s)........................................................62
SECTION 4.09. Rights of Swap Counterparty...........................................................62
SECTION 4.10. Replacement Swap Counterparty.........................................................63
ARTICLE V ADVANCES BY THE MASTER SERVICER AND SERVICERS..........................................................63
ARTICLE VI THE CERTIFICATES......................................................................................63
ARTICLE VII THE DEPOSITOR, THE SELLER, THE MASTER SERVICER, THE SERVICERS, THE SPECIAL SERVICER AND THE
MODIFICATION OVERSIGHT AGENT..................................................................63
ARTICLE VIII DEFAULT.............................................................................................63
ARTICLE IX CONCERNING THE TRUSTEE................................................................................63
ARTICLE X CONCERNING THE TRUST ADMINISTRATOR.....................................................................63
ARTICLE XI TERMINATION...........................................................................................63
SECTION 11.01. Termination upon Liquidation or Purchase of all Mortgage Loans........................63
SECTION 11.02. Determination of the Terminating Entity...............................................66
SECTION 11.03. Procedure Upon Optional Termination or Terminating Auction Sale.......................66
SECTION 11.04. Additional Termination Requirements...................................................68
ARTICLE XII MISCELLANEOUS PROVISIONS.............................................................................69
ARTICLE XIII EXCHANGE ACT REPORTING..............................................................................69
-i-
EXHIBITS
Exhibit A: Standard Terms of Pooling and Servicing Agreement....................................A-1
SCHEDULES
Schedule I: Mortgage Loan Schedule...............................................................I-1
APPENDICES
Appendix A: Calculation of REMIC I Class Y Principal Reduction Amounts .................Appendix A-1
-ii-
THIS SERIES SUPPLEMENT dated as of February 1, 2007 (the "Series Supplement"), to the STANDARD TERMS OF POOLING AND
SERVICING AGREEMENT dated as of February 1, 2007 and attached hereto as Exhibit A (the "Standard Terms" and, together with this
Series Supplement, the "Pooling and Servicing Agreement" or "Agreement"), is hereby executed by and among CREDIT SUISSE FIRST BOSTON
MORTGAGE SECURITIES CORP., as depositor (the "Depositor"), DLJ MORTGAGE CAPITAL, INC. ("DLJMC"), as seller (in such capacity, the
"Seller"), XXXXX FARGO BANK, N.A., as master servicer (in such capacity, the "Master Servicer"), as a servicer (in such capacity, a
"Servicer"), and as trust administrator (in such capacity, the "Trust Administrator"), SELECT PORTFOLIO SERVICING, INC. ("SPS"), as a
servicer (in such capacity, a "Servicer"), as special servicer (in such capacity, the "Special Servicer"), and as modification
oversight agent (the "Modification Oversight Agent"), WASHINGTON MUTUAL MORTGAGE SECURITIES CORP. ("WMMSC"), as a servicer (in such
capacity, a "Servicer"), and U.S. BANK NATIONAL ASSOCIATION, as trustee (in such capacity, the "Trustee"). Capitalized terms used in
this Agreement and not otherwise defined will have the meanings assigned to them in Article I below or, if not defined therein, in
the Standard Terms.
PRELIMINARY STATEMENT
The Depositor is the owner of the Trust Fund (other than the Trust's rights under the Group 5 Interest Rate Cap
Agreement) that is hereby conveyed to the Trustee in return for the Certificates. The Trust Fund (exclusive of any entitlement to
Assigned Prepayment Premiums, the Group 5 Interest Rate Cap Agreement and the assets held in the Group 5 Interest Rate Cap Account)
for federal income tax purposes shall consist of three REMICs (referred to as "REMIC I," "REMIC II" and "REMIC III").
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.
-1-
REMIC I
As provided herein, the Trust Administrator will make an election to treat the segregated pool of assets consisting of the
Group 1, Group 2, Group 3 and Group 4 Mortgage Loans and certain other related assets (exclusive of any entitlement to Assigned
Prepayment Premiums) subject to this Agreement as a real estate mortgage investment conduit (a "REMIC") for federal income tax
purposes, and such segregated pool of assets will be designated as "REMIC I." Component I of the Class AR-L Certificates will
represent the sole Class of "residual interests" in REMIC I for purposes of the REMIC Provisions (as defined herein) under federal
income tax law. The following table irrevocably sets forth the designation, remittance rate (the "Uncertificated REMIC I
Pass-Through Rate") and initial Uncertificated Principal Balance for each of the "regular interests" in REMIC I (the "REMIC I Regular
Interests") and the Class Principal Balance of Component I of the Class AR-L Certificates. 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.
Class Designation for
each REMIC I Regular Initial Uncertificated
Interest and Uncertificated Principal Balance or
Component I of the Type of REMIC I Class Principal
Class AR-L Certificates Interest Pass-Through Rate Balance Final Maturity Date*
___________________________________________________________________________________________________________________
Class Y-1 Regular Variable(1) $ 34,783.56 March 2037
Class Y-2 Regular Variable(2) $ 94,769.71 March 2037
Class Y-3 Regular Variable(3) $ 108,302.62 March 2037
Class Y-4 Regular Variable(4) $ 66,542.02 March 2037
Class Z-1 Regular Variable(1) $ 69,536,328.77 March 2037
Class Z-2 Regular Variable(2) $ 189,455,524.11 March 2037
Class Z-3 Regular Variable(3) $ 216,496,935.54 March 2037
Class Z-4 Regular Variable(4) $ 133,025,126.86 March 2037
Component I of the
Class AR-L Residual Variable(1) $50.00 March 2037
________________________
* The Distribution Date in the specified month, which is the month following the month the latest maturing
Mortgage Loan in the related Loan Group matures. For federal income tax purposes, for each Class of REMIC I
Regular and Residual Interests, the "latest possible maturity date" shall be the Final Maturity Date.
(1) Interest distributed to the REMIC I Regular Interests Y-1 and Z-1 and Component I of the Class AR-L
Certificates on each Distribution Date will have accrued at the weighted average of the Net Mortgage Rates
for the Group 1 Loans on the applicable Uncertificated Principal Balance or Class Principal Balance
outstanding immediately before such Distribution Date.
(2) Interest distributed to the REMIC I Regular Interests Y-2 and Z-2 on each Distribution Date will have
accrued at the weighted average of the Net Mortgage Rates for the Group 2 Loans on the applicable
Uncertificated Principal Balance outstanding immediately before such Distribution Date.
(3) Interest distributed to the REMIC I Regular Interests Y-3 and Z-3 on each Distribution Date will have
accrued at the weighted average of the Net Mortgage Rates for the Group 3 Loans on the applicable
Uncertificated Principal Balance outstanding immediately before such Distribution Date.
(4) Interest distributed to the REMIC I Regular Interests Y-4 and Z-4 on each Distribution Date will have
accrued at the weighted average of the Net Mortgage Rates for the Group 4 Loans on the applicable
Uncertificated Principal Balance outstanding immediately before such Distribution Date.
-2-
REMIC II
As provided herein, the Trust Administrator will make an election to treat the segregated pool of assets consisting of the
Group 5 Mortgage Loans and certain other related assets (exclusive of any entitlement to Assigned Prepayment Premiums, the Group 5
Interest Rate Cap Agreement and the assets held in the Group 5 Interest Rate Cap Account) subject to this Agreement as a real estate
mortgage investment conduit (a "REMIC") for federal income tax purposes, and such segregated pool of assets will be designated as
"REMIC II." Component II of the Class AR-L Certificates will represent the sole Class of "residual interests" in REMIC II for
purposes of the REMIC Provisions (as defined herein) under federal income tax law. The following table irrevocably sets forth the
designation, remittance rate (the "Uncertificated REMIC II Pass-Through Rate") and initial Uncertificated Principal Balance for each
of the "regular interests" in REMIC II (the "REMIC II Regular Interests"). The "latest possible maturity date" (determined solely
for purposes of satisfying Treasury regulation Section 1.860G-1(a)(4)(iii)) for each REMIC II Regular Interest shall be the Maturity
Date. None of the REMIC II Regular Interests will be certificated.
Class Designation for
each REMIC II Regular Initial Uncertificated
Interest and Uncertificated Principal Balance or
Component II of the Type of REMIC II Class Principal
Class AR-L Certificates Interest Pass-Through Rate Balance Final Maturity Date*
______________________________________________________________________________________________________________
Class LT-1 Regular Variable(1) $ 816,321,143.97 March 2037
Class LT-2 Regular Variable(1) $ 26,750.99 March 2037
Class LT-3 Regular 0.00% $ 54,894.78 March 2037
Class LT-4 Regular Variable(2) $ 54,894.78 March 2037
Component II of the
Class AR-L Residual N/A $ 0.00 March 2037
_________________________
* The Distribution Date in the specified month, which is the month following the month the latest maturing
Mortgage Loan in the related Loan Group matures. For federal income tax purposes, for each Class of
REMIC II Regular and Residual Interests, the "latest possible maturity date" shall be the Final Maturity
Date.
(1) Interest distributed to the REMIC II Regular Interests LT-1 and LT-2 on each Distribution Date will have
accrued at the weighted average of the Net Mortgage Rates for the Group 5 Loans on the applicable
Uncertificated Principal Balance outstanding immediately before such Distribution Date
(2) Interest distributed to the REMIC II Regular Interest LT-4 on each Distribution Date will have accrued at
twice the weighted average of the Net Mortgage Rates for the Group 5 Loans on the applicable Uncertificated
Principal Balance outstanding immediately before such Distribution Date.
-3-
REMIC III
As provided herein, the Trust Administrator will elect to treat the segregated pool of assets consisting of the
REMIC I Regular Interests and REMIC II Regular Interests as a REMIC for federal income tax purposes, and such segregated pool of
assets will be designated as REMIC III. The Class AR Certificates will represent the sole Class of "residual interests" in REMIC III
for purposes of the REMIC Provisions under federal income tax law. The following table and the footnotes that follow irrevocably
sets forth the designation, Pass-Through Rate, aggregate Initial Class Principal Balance, and certain other features for each Class
of Certificates comprising the interests representing "regular interests" in REMIC III and the Class AR Certificates. The "latest
possible maturity date" (determined solely for purposes of satisfying Treasury Regulation Section 1.860G-1(a)(4)(iii)) for each Class
of REMIC III Regular Certificates shall be the Maturity Date.
Integral
Class Multiples
Principal Pass-Through Minimum in Excess
Class Balance Rate (per annum) Denomination of Minimum
__________________________________________________________________________________________________________________
Class 1-A-1 $ 61,278,000.00 Variable(1) $25,000 $1
Class 1-A-2 $ 4,015,000.00 Variable(1) $25,000 $1
Class 2-A-1 $ 177,895,000.00 Variable(2) $25,000 $1
Class 3-A-1 $ 90,783,000.00 Variable(3) $25,000 $1
Class 3-A-2-1 $ 40,000,000.00 Variable(3) $25,000 $1
Class 3-A-2-2 $ 60,000,000.00 Variable(3) $25,000 $1
Class 3-A-3 $ 12,502,000.00 Variable(3) $25,000 $1
Class 4-A-1 $ 117,225,000.00 Variable(4) $25,000 $1
Class 4-A-2 $ 7,682,000.00 Variable(4) $25,000 $1
Class 5-A-1 $ 269,630,000.00 Variable(5) $25,000 $1
Class 5-A-2-2 $ 125,000,000.00 Variable(6) $25,000 $1
Class 5-A-2-2 $ 11,156,000.00 Variable(7) $25,000 $1
Class 5-A-3-1 $ 215,682,000.00 Variable(8) $25,000 $1
Class 5-A-3-2 $ 52,352,000.00 Variable(9) $25,000 $1
Class 5-A-4 $ 74,870,000.00 Variable(10) $25,000 $1
Class 5-M-1 $ 11,022,000.00 Variable(11) $25,000 $1
Class 5-M-2 $ 11,022,000.00 Variable(12) $25,000 $1
Class 5-M-3 $ 6,125,000.00 Variable(13) $25,000 $1
Class 5-M-4 $ 5,307,000.00 Variable(14) $25,000 $1
Class 5-M-5 $ 5,307,000.00 Variable(15) $25,000 $1
Class 5-M-6 $ 4,899,000.00 Variable(16) $25,000 $1
Class 5-M-7 $ 4,082,000.00 Variable(17) $25,000 $1
Class 5-M-8 $ 4,082,000.00 Variable(18) $25,000 $1
Class 5-M-9 $ 4,082,000.00 Variable(19) $25,000 $1
Class 5-M-10 $ 4,082,000.00 Variable(20) $25,000 $1
Class C-B-1 $ 13,390,000.00 Variable(21) $25,000 $1
Class C-B-2 $ 8,830,000.00 Variable(21) $25,000 $1
Class C-B-3 $ 4,565,000.00 Variable(21) $25,000 $1
Class C-B-4 $ 4,565,000.00 Variable(21) $25,000 $1
Class C-B-5 $ 3,655,000.00 Variable(21) $25,000 $1
Class C-B-6 $ 2,433,263.19 Variable(21) $25,000 $1*
Class 5-X $ 7,757,684.52(22) Variable(23) (24) N/A
Class P (25) N/A (26) N/A
Class AR $ 50.00 N/A (27) N/A
_______________
* Except for one certificate of the Class C-B-6 Certificates which shall contain any stub piece of less than $1.
(1) With respect to each Distribution Date, the Pass-Through Rate for the Class 1-A-1 and Class 1-A-2 Certificates shall be a per
annum rate equal to the Net WAC Rate for Loan Group 1 for that Distribution Date.
(2) With respect to each Distribution Date, the Pass-Through Rate for the Class 2-A-1 Certificates shall be a per annum rate equal to
the Net WAC Rate for Loan Group 2 for that Distribution Date.
(3) With respect to each Distribution Date, the Pass-Through Rate for the Class 3-A-1, Class 3-A-2-1, Class 3-A-2-2 and Class 3-A-3
Certificates shall be a per annum rate equal to the Net WAC Rate for Loan Group 3 for that Distribution Date.
(4) With respect to each Distribution Date, the Pass-Through Rate for the Class 4-A-1 and Class 4-A-2 Certificates shall be a per
annum rate equal to the Net WAC Rate for Loan Group 4 for that Distribution Date.
-4-
(5) The Pass-Through Rate for the March 2007 Distribution Date for the Class 5-A-1 Certificates is 5.470% per annum. After such
Distribution Date, the Pass-Through Rate for the Class 5-A-1 Certificates shall be a per annum rate equal to the least of (a) the
sum of the applicable Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net Funds Cap
and (c) 11.00%.
(6) The Pass-Through Rate for the March 2007 Distribution Date for the Class 5-A-2-1 Certificates is 5.440% per annum. After such
Distribution Date, the Pass-Through Rate for the Class 5-A-2-1 Certificates shall be a per annum rate equal to the least of
(a) the sum of the applicable Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net
Funds Cap and (c) 11.00%.
(7) The Pass-Through Rate for the March 2007 Distribution Date for the Class 5-A-2-2 Certificates is 5.550% per annum. After such
Distribution Date, the Pass-Through Rate for the Class 5-A-2-2 Certificates shall be a per annum rate equal to the least of
(a) the sum of the applicable Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net
Funds Cap and (c) 11.00%.
(8) The Pass-Through Rate for the March 2007 Distribution Date for the Class 5-A-3-1 Certificates is 5.460% per annum. After such
Distribution Date, the Pass-Through Rate for the Class 5-A-3-1 Certificates shall be a per annum rate equal to the least of
(a) the sum of the applicable Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net
Funds Cap and (c) 11.00%.
(9) The Pass-Through Rate for the March 2007 Distribution Date for the Class 5-A-3-2 Certificates is 5.480% per annum. After such
Distribution Date, the Pass-Through Rate for the Class 5-A-3-2 Certificates shall be a per annum rate equal to the least of
(a) the sum of the applicable Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net
Funds Cap and (c) 11.00%.
(10) The Pass-Through Rate for the March 2007 Distribution Date for the Class 5-A-4 Certificates is 5.520% per annum. After such
Distribution Date, the Pass-Through Rate for the Class 5-A-4 Certificates shall be a per annum rate equal to the least of (a) the
sum of the applicable Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net Funds Cap
and (c) 11.00%.
(11) The Pass-Through Rate for the March 2007 Distribution Date for the Class 5-M-1 Certificates is 5.590% per annum. After such
Distribution Date, the Pass-Through Rate for the Class 5-M-1 Certificates shall be a per annum rate equal to the least of (a) the
sum of the applicable Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net Funds Cap
and (c) 11.00%.
(12) The Pass-Through Rate for the March 2007 Distribution Date for the Class 5-M-2 Certificates is 5.620% per annum. After such
Distribution Date, the Pass-Through Rate for the Class 5-M-2 Certificates shall be a per annum rate equal to the least of (a) the
sum of the applicable Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net Funds Cap
and (c) 11.00%.
(13) The Pass-Through Rate for the March 2007 Distribution Date for the Class 5-M-3 Certificates is 5.720% per annum. After such
Distribution Date, the Pass-Through Rate for the Class 5-M-3 Certificates shall be a per annum rate equal to the least of (a) the
sum of the applicable Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net Funds Cap
and (c) 11.00%.
(14) The Pass-Through Rate for the March 2007 Distribution Date for the Class 5-M-4 Certificates is 5.820% per annum. After such
Distribution Date, the Pass-Through Rate for the Class 5-M-4 Certificates shall be a per annum rate equal to the least of (a) the
sum of the applicable Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net Funds Cap
and (c) 11.00%.
(15) The Pass-Through Rate for the March 2007 Distribution Date for the Class 5-M-5 Certificates is 5.840% per annum. After such
Distribution Date, the Pass-Through Rate for the Class 5-M-5 Certificates shall be a per annum rate equal to the least of (a) the
sum of the applicable Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net Funds Cap
and (c) 11.00%.
(16) The Pass-Through Rate for the March 2007 Distribution Date for the Class 5-M-6 Certificates is 5.900% per annum. After such
Distribution Date, the Pass-Through Rate for the Class 5-M-6 Certificates shall be a per annum rate equal to the least of (a) the
sum of the applicable Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net Funds Cap
and (c) 11.00%.
(17) The Pass-Through Rate for the March 2007 Distribution Date for the Class 5-M-7 Certificates is 6.570% per annum. After such
Distribution Date, the Pass-Through Rate for the Class 5-M-7 Certificates shall be a per annum rate equal to the least of (a) the
sum of the applicable Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net Funds Cap
and (c) 11.00%.
(18) The Pass-Through Rate for the March 2007 Distribution Date for the Class 5-M-8 Certificates is 6.920% per annum. After such
Distribution Date, the Pass-Through Rate for the Class 5-M-8 Certificates shall be a per annum rate equal to the least of (a) the
sum of the applicable Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net Funds Cap
and (c) 11.00%.
(19) The Pass-Through Rate for the March 2007 Distribution Date for the Class 5-M-9 Certificates is 7.570% per annum. After such
Distribution Date, the Pass-Through Rate for the Class 5-M-9 Certificates shall be a per annum rate equal to the least of (a) the
sum of the applicable Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net Funds Cap
and (c) 11.00%.
(20) The Pass-Through Rate for the March 2007 Distribution Date for the Class 5-M-10 Certificates is 7.570% per annum. After such
Distribution Date, the Pass-Through Rate for the Class 5-M-10 Certificates shall be a per annum rate equal to the least of
(a) the sum of the applicable Certificate Index and the applicable Certificate Margin for such Distribution Date, (b) the Net
Funds Cap and (c) 11.00%.
-5-
(21) With respect to each Distribution Date, the Pass-Through Rate for the Class C-B-1, Class C-B-2, Class C-B-3, Class C-B-4,
Class C-B-5 and Class C-B-6 Certificates shall be a per annum rate equal to the quotient, expressed as a percentage of (a) the
sum of (i) the product of (x) the Net WAC Rate of Loan Group 1 for that Distribution Date and (y) the Subordinate
Component Balance for Loan Group 1 immediately prior to such Distribution Date, (ii) the product of (x) the Net WAC Rate of Loan
Group 2 for that Distribution Date and (y) the Subordinate Component Balance for Loan Group 2 immediately prior to such
Distribution Date, (iii) the product of (x) the Net WAC Rate of Loan Group 3 for that Distribution Date and (y) the Subordinate
Component Balance for Loan Group 3 immediately prior to such Distribution Date and (iv) the product of (x) the Net WAC Rate of
Loan Group 4 for that Distribution Date and (y) the Subordinate Component Balance for Loan Group 4 immediately prior to such
Distribution Date, divided by (b) the aggregate of the Subordinate Component Balances for Loan Group 1, Loan Group 2, Loan Group
3 and Loan Group 4 immediately prior to such Distribution Date.
(22) The Class 5-X Certificates will not accrue interest on their Class Principal Balance. The Class 5-X Certificates accrue interest
on the Class 5-X Notional Amount.
(23) The Class 5-X Certificates will be comprised of two REMIC III regular interests, a principal only regular interest designated
5-X-PO and an interest only regular interest designated 5-X-IO, which will be entitled to distributions as set forth herein. On
each Distribution Date, the Class 5-X Certificates shall be entitled to the Class 5-X Distributable Amount. With respect to any
Distribution Date, interest accrued on the Class 5-X Certificates during the related Accrual Period shall equal interest at the
related Pass-Through Rate on the Class 5-X Notional Amount immediately prior to such Distribution Date, in each case reduced by
any interest shortfalls with respect to the Mortgage Loans in the related Loan Group including Prepayment Interest Shortfalls to
the extent not covered by Compensating Interest Payments. The Pass-Through Rate for the Class 5-X Certificates or the REMIC III
Regular Interest 5-X-IO for any Distribution Date shall equal a per annum rate equal to the percentage equivalent of a fraction,
the numerator of which is the product of (a) 30 and (b) the sum of the amounts calculated pursuant to clauses (i) through
(iv) below, and the denominator of which is the product of (a) the actual number of days in the related Accrual Period and
(b) the aggregate principal balance of the REMIC II Regular Interests LT1, LT2, LT3 and LT4. For purposes of calculating the
Pass-Through Rate for the Class 5-X Certificates, the numerator is equal to the sum of the following components:
(i) the Uncertificated Pass-Through Rate for REMIC II Regular Interests LT1 minus the Marker Rate, applied to a notional
amount equal to the aggregate Uncertificated Principal Balance of REMIC II Regular Interests LT1;
(ii) the Uncertificated Pass-Through Rate for REMIC II Regular Interest LT2 minus the Marker Rate, applied to a notional
amount equal to the Uncertificated Principal Balance of REMIC II Regular Interest LT2; and
(iii) the Uncertificated Pass-Through Rate for REMIC II Regular Interest LT4 minus twice the Marker Rate, applied to a
notional amount equal to the Uncertificated Principal Balance of REMIC II Regular Interest LT4.
Accrued interest on the Class 5-X Certificates shall accrue on the basis of a 360-day year and the actual number of days in the
related Accrual Period. Payments to any Class of Group 5 Certificates in respect of Basis Risk Shortfalls from the Group 5
Available Distribution Amount shall be deemed to have first been distributed from REMIC III to the holders of the Class 5-X
Certificates in respect of the Class 5-X-IO REMIC III Regular Interest and then paid by such holders to such Class of Group 5
Certificates.
(24) The Class 5-X Certificates will be issued in certificated, fully-registered form in minimum denominations of 20% of the
Percentage Interest therein and increments of 10% in excess thereof.
(25) The Class P Certificates will not have a Class Principal Balance. The Class P Certificates shall have an initial notional
balance of $338,569,810 and will be entitled to distributions of Assigned Prepayment Premiums only. Such entitlement shall not
be an interest in any REMIC created hereunder.
(26) The Class P Certificates will be issued in certificated, fully-registered form in minimum denominations of 20% of the Percentage
Interest therein and increments of 10% in excess thereof.
(27) The Class AR Certificates are issued in minimum Percentage Interests of 20%.
For the avoidance of doubt, the Trust Administrator shall account for any interest amount due to a Certificateholder
in excess of the interest rate on the REMIC Regular Interest issued by REMIC III corresponding to such Certificate as part of the
payment made to the Class 5-X Certificates, to the extent it is entitled to funds from the REMIC, and then paid outside of the REMIC
pursuant to a separate contractual right to such Certificateholder.
The foregoing REMIC structure is intended to cause all of the cash from the Mortgage Loans to flow through to
REMIC III as cash flow on a REMIC Regular Interest, without creating any shortfall—actual or potential (other than for credit losses)
to any REMIC Regular Interest. To the extent that the structure is believed to diverge from such intention the Trust Administrator
shall resolve ambiguities to accomplish such result and shall to the extent necessary rectify any drafting errors or seek
clarification to the structure without Certificateholder approval (but with guidance of counsel) to accomplish such intention.
-6-
Set forth below are designations of Classes of Certificates and Loan Groups to the categories used herein:
Book-Entry Certificates............. All Classes of Certificates other than the Physical Certificates.
Class A Certificates................ The Group 1, Group 2, Group 3, Group 4 and Group 5 Senior Certificates.
Class C-B Certificates.............. The Class C-B-1, Class C-B-2, Class C-B-3, Class C-B-4, Class C-B-5 and
Class C-B-6 Certificates.
Class M Certificates................ The Class 5-M-1, Class 5-M-2, Class 5-M-3, Class 5-M-4, Class 5-M-5,
Class 5-M-6, Class 5-M-7, Class 5-M-8, Class 5-M-9 and Class 5-M-10
Certificates.
Economic Residual Floater Certificates
The Class 5-X Certificates.
ERISA-Restricted Certificates....... Residual Certificates and Private Certificates; and any Certificates that
do not satisfy the applicable ratings requirement under the Underwriter's
Exemption.
Floater Certificates................ The Group 5 Certificates.
Floater Loan Group.................. Loan Group 5.
Group 1 Certificates................ The Class 1-A-1, Class 1-A-2 and Residual Certificates.
Group 2 Certificates................ The Class 2-A-1 Certificates.
Group 3 Certificates................ The Class 3-A-1, Class 3-A-2-1, Class 3-A-2-2 and Class 3-A-3 Certificates.
Group 4 Certificates................ The Class 4-A-1 and Class 4-A-2 Certificates.
Group 5 Certificates................ The Group 5 Senior Certificates, Class 5-X Certificates and Class M
Certificates.
Group 5 Senior Certificates......... The Class 5-A-1, Class 5-A-2-1, Class 5-A-2-2, Class 5-A-3-1, Class 5-A-3-2
and Class 5-A-4 Certificates.
Group 5 Subordinate Certificates....
The Class M Certificates and Class 5-X Certificates.
LIBOR Certificates.................. The Group 5 Senior Certificates and Class M Certificates.
Notional Amount Certificates........ The Class 5-X Certificates and Class P Certificates.
Offered Certificates................ All Classes of Certificates other than the Private Certificates.
Pass-Through Certificates........... The Group 1, Group 2, Group 3, Group 4 and Class C-B Certificates.
Pass-Through Loan Groups............ Loan Group 1, Loan Group 2, Loan Group 3 and Loan Group 4.
Private Certificates................ The Class C-B-4, Class C-B-5, Class C-B-6, Class 5-X and Class P
Certificates.
Physical Certificates............... The Residual Certificates and the Private Certificates.
Rating Agencies..................... Xxxxx'x and S&P.
Regular Certificates................ All Classes of Certificates other than the Residual Certificates.
-7-
Related Pass-Through Loan Groups.... Collectively, Loan Group 1, Loan Group 2, Loan Group 3 and Loan Group 4.
Residual Certificates............... The Class AR and Class AR-L Certificates.
Senior Certificates................. With respect to the Pass-Through Loan Groups, the Group 1, Group 2, Group 3
and Group 4 Certificates, and with respect to the Floater Loan Group, the
Group 5 Senior Certificates.
Subordinate Certificates............ With respect to the Pass-Through Loan Groups, the Class C-B Certificates,
and with respect to the Floater Loan Group, the Group 5 Subordinate
Certificates.
All covenants and agreements made by the Depositor herein are for the benefit and security of the
Certificateholders. The Depositor is entering into this Agreement, and the Trustee is accepting the trusts created hereby and
thereby, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged.
The parties hereto intend to effect an absolute sale and assignment of the Mortgage Loans to the Trustee for the
benefit of Certificateholders under this Agreement. However, the Depositor and the Seller will hereunder absolutely assign and, as a
precautionary matter grant a security interest, in and to its rights, if any, in the Mortgage Loans to the Trustee on behalf of
Certificateholders to ensure that the interest of the Certificateholders hereunder in the Mortgage Loans is fully protected.
W I T N E S S E T H T H A T:
In consideration of the mutual agreements herein contained, the Depositor, the Seller, the Master Servicer, the
Servicers, the Special Servicer, the Modification Oversight Agent, the Trustee and the Trust Administrator agree as follows:
-8-
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and phrases, unless the context otherwise requires, shall have
the following meanings:
Accrual Period: For any interest bearing Class of Certificates (other than the LIBOR Certificates) and each Class
of REMIC I Regular Interests and REMIC II Regular Interests and any Distribution Date, the calendar month immediately preceding such
Distribution Date, and with respect to the LIBOR Certificates, the period beginning on the immediately preceding Distribution Date
(or the Closing Date, in the case of the first Accrual Period) and ending on the day immediately preceding such Distribution Date.
Advance: With respect to any Countrywide Serviced Mortgage Loan and any Distribution Date, the payment required to
be made by Countrywide with respect to the Remittance Date (as defined in the Countrywide Underlying Servicing Agreement) in the
month of such Distribution Date pursuant to Subsection 11.19 of Exhibit 9 of the Countrywide Underlying Servicing Agreement.
With respect to any Fifth Third Serviced Mortgage Loan and any Distribution Date, the payment required to be made by
Fifth Third with respect to the Remittance Date (as defined in the Fifth Third Underlying Servicing Agreement) in the month of such
Distribution Date pursuant to Section 5.03 of the Fifth Third Underlying Servicing Agreement.
With respect to any First Horizon Serviced Mortgage Loan and any Distribution Date, the payment required to be made
by First Horizon with respect to the Remittance Date (as defined in the First Horizon Underlying Servicing Agreement) in the month of
such Distribution Date pursuant to Section 5.03 of the First Horizon Underlying Servicing Agreement.
With respect to any IndyMac Serviced Mortgage Loan and any Distribution Date, the payment required to be made by
IndyMac with respect to the Remittance Date (as defined in the IndyMac Underlying Servicing Agreement) in the month of such
Distribution Date pursuant to Section 5.03 of the IndyMac Underlying Servicing Agreement.
With respect to any SunTrust Serviced Mortgage Loan and any Distribution Date, the payment required to be made by
SunTrust with respect to the Remittance Date (as defined in the SunTrust Underlying Servicing Agreement) in the month of such
Distribution Date pursuant to Section 5.03 of the SunTrust Underlying Servicing Agreement.
With respect to any Wachovia Serviced Mortgage Loan and any Distribution Date, the payment required to be made by
Wachovia with respect to the Remittance Date (as defined in the Wachovia Underlying Servicing Agreement) in the month of such
Distribution Date pursuant to Section 5.03 of the Wachovia Underlying Servicing Agreement.
With respect to any WaMu Bank Serviced Mortgage Loan and any Distribution Date, the payment required to be made by
WaMu Bank with respect to the Monthly Remittance Date (as defined in the WaMu Bank Underlying Servicing Agreement) in the month of
such Distribution Date pursuant to Section 2.16 of the WaMu Bank Underlying Servicing Agreement.
Adverse REMIC Event: As defined in Section 2.07(f).
-9-
Aggregate Groups 1-4 Collateral Balance: With respect to any date of determination, will be equal to the sum of the
Aggregate Loan Group Balances for Loan Group 1, Loan Group 2, Loan Group 3 and Loan Group 4 as of such date of determination.
Agreement: Collectively, this Series Supplement and the Standard Terms, and all amendments or supplements hereto.
Assigned Prepayment Premium: Any Prepayment Premium on a Xxxxx Fargo Serviced Mortgage Loan, any Prepayment Premium
on a SPS Serviced Mortgage Loan and any other Prepayment Premium on deposit in the Certificate Account.
Available Distribution Amount: With respect to any Distribution Date and each Pass-Through Loan Group, the sum of:
(i) all amounts in respect of Scheduled Payments (net of the related Expense Fees) due on the related Due Date
and received prior to the related Determination Date on the related Mortgage Loans, together with any Advances in respect
thereof;
(ii) all Insurance Proceeds (to the extent not applied to the restoration of the Mortgaged Property or released
to the Mortgagor in accordance with the applicable Servicer's Accepted Servicing Standards), all Liquidation Proceeds
received during the calendar month preceding the month of that Distribution Date on the related Mortgage Loans, in each case
net of unreimbursed Liquidation Expenses incurred with respect to such Mortgage Loans;
(iii) all Principal Prepayments received during the related Prepayment Period on the related Mortgage Loans,
excluding Prepayment Premiums;
(iv) amounts received with respect to such Distribution Date as the Substitution Adjustment Amount or Purchase
Price in respect of a Mortgage Loan in the related Loan Group repurchased by the Seller, purchased by a Holder of a
Subordinate Certificate pursuant to Section 3.11(f) or purchased by the Special Servicer pursuant to Section 3.11(g) as of
such Distribution Date;
(v) any amounts payable as Compensating Interest Payments by a Servicer with respect to the related Mortgage
Loans on such Distribution Date;
(vi) all Recoveries, if any; and
(vii) the portion of the Mortgage Loan Purchase Price related to such Loan Group paid in connection with an
Optional Termination up to the amount of the Par Value for such Loan Group;
in the case of clauses (i) through (iv) above reduced by amounts in reimbursement for Advances previously made and other amounts as
to which the Trustee, the Trust Administrator, a Servicer or the Master Servicer is entitled to be reimbursed pursuant to
Section 3.08 in respect of the related Mortgage Loans or otherwise.
Basis Risk Shortfall: For any Class of LIBOR Certificates and any Distribution Date, the sum of (i) the excess, if
any, of (a) the related Current Interest calculated on the basis of the least of (x) the applicable Certificate Index plus the
applicable Certificate Margin, (y) the Maximum Interest Rate and (z) 11.00% over (b) the related Current Interest for the applicable
Distribution Date, (ii) any amount described in clause (i) remaining unpaid from prior Distribution Dates, and (iii) interest on the
amount in clause (ii) for the related Accrual Period calculated at a per annum rate equal to the least of (x) the applicable
Certificate Index plus the applicable Certificate Margin, (y) the applicable Maximum Interest Rate and (z) 11.00%.
-10-
Capitalized Interest Account: Not Applicable.
Capitalized Interest Deposit: Not Applicable.
Capitalized Interest Distribution: Not Applicable.
Capitalized Interest Release Amount: Not Applicable.
Capitalized Interest Requirement: Not Applicable.
Capitalized Interest Requirement Rate: Not Applicable.
Carryforward Interest: For any Class of LIBOR Certificates and any Distribution Date, the sum of (1) the amount, if
any, by which (x) the sum of (A) Current Interest for such Class for the immediately preceding Distribution Date and (B) any unpaid
Carryforward Interest for such Class from previous Distribution Dates exceeds (y) the amount paid in respect of interest on such
Class on such immediately preceding Distribution Date, and (2) interest on such amount for the related Accrual Period at the
applicable Pass-Through Rate.
Certificate Balance: With respect to any Certificate (other than a Class 5-X Certificate), as defined in the
Standard Terms.
With respect to each Class 5-X 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 Aggregate Loan Group Balance for
Loan Group 5 as of such date of determination, over (B) the then aggregate Class Principal Balance of the Group 5 Senior Certificates
and Class M Certificates then outstanding, which represents the sum of (i) the initial principal balance of the REMIC III Regular
Interest 5-X-PO, as reduced by Realized Losses allocated thereto and payments deemed made thereon, and (ii) accrued and unpaid
interest on the REMIC III Regular Interest 5-X-IO, as reduced by Realized Losses allocated thereto.
Certificate Group: Any of Certificate Group 1, Certificate Group 2, Certificate Group 3, Certificate Group 4 or
Certificate Group 5, as applicable.
Certificate Group 1: Any of the Certificates with a Class designation beginning with "1" and relating to Loan
Group 1.
Certificate Group 2: Any of the Certificates with a Class designation beginning with "2" and relating to Loan
Group 2.
Certificate Group 3: Any of the Certificates with a Class designation beginning with "3" and relating to Loan
Group 3.
Certificate Group 4: Any of the Certificates with a Class designation beginning with "4" and relating to Loan
Group 4.
-11-
Certificate Group 5: Any of the Certificates with a Class designation beginning with "5" and relating to Loan
Group 5.
Certificate Margin: As to each Class of LIBOR Certificates, the applicable amount set forth below:
Certificate Margin
Class (1) (2)
____________________________________________________________________________
5-A-1 0.150% 0.300%
5-A-2-1 0.120% 0.240%
5-A-2-2 0.230% 0.460%
5-A-3-1 0.140% 0.280%
5-A-3-2 0.160% 0.320%
5-A-4 0.200% 0.400%
5-M-1 0.270% 0.540%
5-M-2 0.300% 0.600%
5-M-3 0.400% 0.800%
5-M-4 0.500% 1.000%
5-M-5 0.520% 1.020%
5-M-6 0.580% 1.080%
5-M-7 1.250% 1.750%
5-M-8 1.600% 2.100%
5-M-9 2.250% 2.750%
5-M-10 2.250% 2.750%
___________
(1) On and prior to the first Distribution Date on which the Optional Termination for Loan Group 5 may
occur.
(2) After the first Distribution Date on which the Optional Termination for Loan Group 5 may occur.
Class: All Certificates bearing the same class designation as set forth in the Preliminary Statement.
Class 5-M-1 Principal Payment Amount: For any Distribution Date on or after the Stepdown Date and as long as a
Trigger Event has not occurred with respect to such Distribution Date, will be the amount, if any, by which (x) the sum of (i) the
aggregate Class Principal Balance of the Group 5 Senior Certificates, after giving effect to payments on such Distribution Date and
(ii) the Class Principal Balance of the Class 5-M-1 Certificates immediately prior to such Distribution Date exceeds (y) the lesser
of (A) the product of (i) 86.10% and (ii) the Aggregate Loan Group Balance for Loan Group 5 for such Distribution Date and (B) the
amount, if any, by which (i) the Aggregate Loan Group Balance for Loan Group 5 for such Distribution Date exceeds (ii) 0.50% of the
Aggregate Loan Group Balance for Loan Group 5 as of the Cut-off Date.
Class 5-M-2 Principal Payment Amount: For any Distribution Date on or after the Stepdown Date and as long as a
Trigger Event has not occurred with respect to such Distribution Date, will be the amount, if any, by which (x) the sum of (i) the
aggregate Class Principal Balance of the Group 5 Senior Certificates and Class 5-M-1 Certificates, in each case, after giving effect
to payments on such Distribution Date and (ii) the Class Principal Balance of the Class 5-M-2 Certificates immediately prior to such
Distribution Date exceeds (y) the lesser of (A) the product of (i) 88.80% and (ii) the Aggregate Loan Group Balance for Loan Group 5
for such Distribution Date and (B) the amount, if any, by which (i) the Aggregate Loan Group Balance for Loan Group 5 for such
Distribution Date exceeds (ii) 0.50% of the Aggregate Loan Group Balance for Loan Group 5 as of the Cut-off Date.
-12-
Class 5-M-3 Principal Payment Amount: For any Distribution Date on or after the Stepdown Date and as long as a
Trigger Event has not occurred with respect to such Distribution Date, will be the amount, if any, by which (x) the sum of (i) the
aggregate Class Principal Balance of the Group 5 Senior Certificates, Class 5-M-1 and Class 5-M-2 Certificates, in each case, after
giving effect to payments on such Distribution Date and (ii) the Class Principal Balance of the Class 5-M-3 Certificates immediately
prior to such Distribution Date exceeds (y) the lesser of (A) the product of (i) 90.30% and (ii) the Aggregate Loan Group Balance for
Loan Group 5 for such Distribution Date and (B) the amount, if any, by which (i) the Aggregate Loan Group Balance for Loan Group 5
for such Distribution Date exceeds (ii) 0.50% of the Aggregate Loan Group Balance for Loan Group 5 as of the Cut-off Date.
Class 5-M-4 Principal Payment Amount: For any Distribution Date on or after the Stepdown Date and as long as a
Trigger Event has not occurred with respect to such Distribution Date, will be the amount, if any, by which (x) the sum of (i) the
aggregate Class Principal Balance of the Group 5 Senior Certificates, Class 5-M-1, Class 5-M-2 and Class 5-M-3 Certificates, in each
case, after giving effect to payments on such Distribution Date and (ii) the Class Principal Balance of the Class 5-M-4 Certificates
immediately prior to such Distribution Date exceeds (y) the lesser of (A) the product of (i) 91.60% and (ii) the Aggregate Loan Group
Balance for Loan Group 5 for such Distribution Date and (B) the amount, if any, by which (i) the Aggregate Loan Group Balance for
Loan Group 5 for such Distribution Date exceeds (ii) 0.50% of the Aggregate Loan Group Balance for Loan Group 5 as of the Cut-off
Date.
Class 5-M-5 Principal Payment Amount: For any Distribution Date on or after the Stepdown Date and as long as a
Trigger Event has not occurred with respect to such Distribution Date, will be the amount, if any, by which (x) the sum of (i) the
aggregate Class Principal Balance of the Group 5 Senior Certificates, Class 5-M-1, Class 5-M-2, Class 5-M-3 and Class 5-M-4
Certificates, in each case, after giving effect to payments on such Distribution Date and (ii) the Class Principal Balance of the
Class 5-M-5 Certificates immediately prior to such Distribution Date exceeds (y) the lesser of (A) the product of (i) 92.90% and
(ii) the Aggregate Loan Group Balance for Loan Group 5 for such Distribution Date and (B) the amount, if any, by which (i) the
Aggregate Loan Group Balance for Loan Group 5 for such Distribution Date exceeds (ii) 0.50% of the Aggregate Loan Group Balance for
Loan Group 5 as of the Cut-off Date.
Class 5-M-6 Principal Payment Amount: For any Distribution Date on or after the Stepdown Date and as long as a
Trigger Event has not occurred with respect to such Distribution Date, will be the amount, if any, by which (x) the sum of (i) the
aggregate Class Principal Balance of the Group 5 Senior Certificates, Class 5-M-1, Class 5-M-2, Class 5-M-3, Class 5-M-4 and
Class 5-M-5 Certificates, in each case, after giving effect to payments on such Distribution Date and (ii) the Class Principal Balance
of the Class 5-M-6 Certificates immediately prior to such Distribution Date exceeds (y) the lesser of (A) the product of (i) 94.10%
and (ii) the Aggregate Loan Group Balance for Loan Group 5 for such Distribution Date and (B) the amount, if any, by which (i) the
Aggregate Loan Group Balance for Loan Group 5 for such Distribution Date exceeds (ii) 0.50% of the Aggregate Loan Group Balance for
Loan Group 5 as of the Cut-off Date.
Class 5-M-7 Principal Payment Amount: For any Distribution Date on or after the Stepdown Date and as long as a
Trigger Event has not occurred with respect to such Distribution Date, will be the amount, if any, by which (x) the sum of (i) the
aggregate Class Principal Balance of the Group 5 Senior Certificates, Class 5-M-1, Class 5-M-2, Class 5-M-3, Class 5-M-4, Class 5-M-5
and Class 5-M-6 Certificates, in each case, after giving effect to payments on such Distribution Date and (ii) the Class Principal
Balance of the Class 5-M-7 Certificates immediately prior to such Distribution Date exceeds (y) the lesser of (A) the product of
(i) 95.10% and (ii) the Aggregate Loan Group Balance for Loan Group 5 for such Distribution Date and (B) the amount, if any, by which
(i) the Aggregate Loan Group Balance for Loan Group 5 for such Distribution Date exceeds (ii) 0.50% of the Aggregate Loan Group
Balance for Loan Group 5 as of the Cut-off Date.
-13-
Class 5-M-8 Principal Payment Amount: For any Distribution Date on or after the Stepdown Date and as long as a
Trigger Event has not occurred with respect to such Distribution Date, will be the amount, if any, by which (x) the sum of (i) the
aggregate Class Principal Balance of the Group 5 Senior Certificates, Class 5-M-1, Class 5-M-2, Class 5-M-3, Class 5-M-4,
Class 5-M-5, Class 5-M-6 and Class 5-M-7 Certificates, in each case, after giving effect to payments on such Distribution Date and
(ii) the Class Principal Balance of the Class 5-M-8 Certificates immediately prior to such Distribution Date exceeds (y) the lesser of
(A) the product of (i) 96.10% and (ii) the Aggregate Loan Group Balance for Loan Group 5 for such Distribution Date and (B) the
amount, if any, by which (i) the Aggregate Loan Group Balance for Loan Group 5 for such Distribution Date exceeds (ii) 0.50% of the
Aggregate Loan Group Balance for Loan Group 5 as of the Cut-off Date.
Class 5-M-9 Principal Payment Amount: For any Distribution Date on or after the Stepdown Date and as long as a
Trigger Event has not occurred with respect to such Distribution Date, will be the amount, if any, by which (x) the sum of (i) the
aggregate Class Principal Balance of the Group 5 Senior Certificates, Class 5-M-1, Class 5-M-2, Class 5-M-3, Class 5-M-4,
Class 5-M-5, Class 5-M-6, Class 5-M-7 and Class 5-M-8 Certificates, in each case, after giving effect to payments on such Distribution
Date and (ii) the Class Principal Balance of the Class 5-M-9 Certificates immediately prior to such Distribution Date exceeds (y) the
lesser of (A) the product of (i) 97.10% and (ii) the Aggregate Loan Group Balance for Loan Group 5 for such Distribution Date and (B)
the amount, if any, by which (i) the Aggregate Loan Group Balance for Loan Group 5 for such Distribution Date exceeds (ii) 0.50% of
the Aggregate Loan Group Balance for Loan Group 5 as of the Cut-off Date.
Class 5-M-10 Principal Payment Amount: For any Distribution Date on or after the Stepdown Date and as long as a
Trigger Event has not occurred with respect to such Distribution Date, will be the amount, if any, by which (x) the sum of (i) the
aggregate Class Principal Balance of the Group 5 Senior Certificates, Class 5-M-1, Class 5-M-2, Class 5-M-3, Class 5-M-4,
Class 5-M-5, Class 5-M-6, Class 5-M-7, Class 5-M-8 and Class 5-M-9 Certificates, in each case, after giving effect to payments on such
Distribution Date and (ii) the Class Principal Balance of the Class 5-M-10 Certificates immediately prior to such Distribution Date
exceeds (y) the lesser of (A) the product of (i) 98.10% and (ii) the Aggregate Loan Group Balance for Loan Group 5 for such
Distribution Date and (B) the amount, if any, by which (i) the Aggregate Loan Group Balance for Loan Group 5 for such Distribution
Date exceeds (ii) 0.50% of the Aggregate Loan Group Balance for Loan Group 5 as of the Cut-off Date.
Class 5-X Distributable Amount: With respect to any Distribution Date and the Class 5-X Certificates, to the extent
of any Monthly Excess Cashflow remaining on such Distribution Date after the distribution of amounts pursuant to
Section 4.01(II)(d)(i)-(xxiv), the sum of (a) the amount of interest accrued during the related Accrual Period on the Class 5-X
Certificates (as described in the Preliminary Statement) and (b) the Overcollateralization Release Amount, if any, for such
Distribution Date.
Class 5-X Notional Amount: With respect to the Class 5-X Certificates or REMIC III Regular Interest 5-X-IO and any
Distribution Date, the aggregate of the Uncertificated Principal Balances of the REMIC II Regular Interests LT1, LT2, LT3 and LT4
immediately prior to such Distribution Date, (which for clarification is equal to the Aggregate Loan Group Balance for Loan Group 5
as of the first day of the related Collection Period (excluding any such Mortgage Loans that were subject to a Payoff, the principal
of which was distributed on the Distribution Date preceding the current Distribution Date)).
-14-
Class A Certificates: As set forth in the Preliminary Statement.
Class C-B Certificates: As set forth in the Preliminary Statement.
Class C-B Credit Support Depletion Date: The first Distribution Date on which the aggregate Class Principal Balance
of the Class C-B Certificates has been or will be reduced to zero.
Class C-B Percentage: With respect to any Distribution Date, the aggregate Class Principal Balance of the Class C-B
Certificates immediately prior to such Distribution Date divided by the Aggregate Groups 1-4 Collateral Balance as of the first day
of the related Collection Period (excluding any such Mortgage Loans that were subject to a Payoff, the principal of which was
distributed on the Distribution Date preceding the current Distribution Date).
Class M Certificates: The Class 5-M-1, Class 5-M-2, Class 5-M-3, Class 5-M-4, Class 5-M-5, Class 5-M-6,
Class 5-M-7, Class 5-M-8, Class 5-M-9 and Class 5-M-10 Certificates.
Class Notional Amount: The Class 5-X Notional Amount.
Class Y Principal Reduction Amounts: For any Distribution Date, the amounts by which the Uncertificated Principal
Balances of the Class Y Regular Interests will be reduced on such Distribution Date by the allocation of Realized Losses and the
distribution of principal, determined as described in Appendix A.
Class Y Regular Interests: The Class Y-1, Class Y-2, Class Y-3 and Class Y-4 Regular Interests.
Class Y-1 Principal Distribution Amount: For any Distribution Date, the excess, if any, of the Class Y-1 Principal
Reduction Amount for such Distribution Date over the principal portion of Realized Losses allocated to the Class Y-1 Regular Interest
on such Distribution Date.
Class Y-1 Principal Reduction Amount: The Class Y Principal Reduction Amount for the Class Y-1 Regular Interest as
determined pursuant to the provisions of the Appendix A.
Class Y-1 Regular Interest: The uncertificated undivided beneficial interest in REMIC I which constitutes a REMIC I
Regular Interest and is entitled to distributions as set forth herein.
Class Y-2 Principal Distribution Amount: For any Distribution Date, the excess, if any, of the Class Y-2 Principal
Reduction Amount for such Distribution Date over the principal portion of Realized Losses allocated to the Class Y-2 Regular Interest
on such Distribution Date.
Class Y-2 Principal Reduction Amount: The Class Y Principal Reduction Amount for the Class Y-2 Regular Interest as
determined pursuant to the provisions of the Appendix A.
Class Y-2 Regular Interest: The uncertificated undivided beneficial interest in REMIC I which constitutes a REMIC I
Regular Interest and is entitled to distributions as set forth herein.
-15-
Class Y-3 Principal Distribution Amount: For any Distribution Date, the excess, if any, of the Class Y-3 Principal
Reduction Amount for such Distribution Date over the principal portion of Realized Losses allocated to the Class Y-3 Regular Interest
on such Distribution Date.
Class Y-3 Principal Reduction Amount: The Class Y Principal Reduction Amount for the Class Y-3 Regular Interest as
determined pursuant to the provisions of the Appendix A.
Class Y-3 Regular Interest: The uncertificated undivided beneficial interest in REMIC I which constitutes a REMIC I
Regular Interest and is entitled to distributions as set forth herein.
Class Y-4 Principal Distribution Amount: For any Distribution Date, the excess, if any, of the Class Y-4 Principal
Reduction Amount for such Distribution Date over the principal portion of Realized Losses allocated to the Class Y-4 Regular Interest
on such Distribution Date.
Class Y-4 Principal Reduction Amount: The Class Y Principal Reduction Amount for the Class Y-4 Regular Interest as
determined pursuant to the provisions of the Appendix A.
Class Y-4 Regular Interest: The uncertificated undivided beneficial interest in REMIC I which constitutes a REMIC I
Regular Interest and is entitled to distributions as set forth herein.
Class Z Principal Reduction Amounts: For any Distribution Date, the amounts by which the Uncertificated Principal
Balances of the Class Z Regular Interests will be reduced on such Distribution Date by the allocation of Realized Losses and the
distribution of principal, which shall be in each case the excess of (A) the sum of (x) the excess of the REMIC I Available
Distribution Amount for the related Group (i.e. the "related Group" for the Class Z-1 Regular Interest is the Group 1 Loans, the
"related Group" for the Class Z-2 Regular Interest is the Group 2 Loans, the "related Group" for the Class Z-3 Regular Interest is the
Group 3 Loans and the "related Group" for the Class Z-4 Regular Interest is the Group 4 Loans) exclusive of any Recoveries included
therein over the amounts thereof distributable (i) in respect of interest on such Class Z Regular Interest and the related Class Y
Regular Interest and (ii) in the case of the Group 1 Loans, to the Class AR-L Certificates and (y) the amount of Realized Losses
allocable to principal for the related Group over (B) the Class Y Principal Reduction Amount for the related Group.
Class Z Regular Interests: The Class Z-1, Class Z-2, Class Z-3 and Class Z-4 Regular Interests.
Class Z-1 Principal Distribution Amount: For any Distribution Date, the excess, if any, of the Class Z-1 Principal
Reduction Amount for such Distribution Date over the principal portion of Realized Losses allocated to the Class Z-1 Regular Interest
on such Distribution Date.
Class Z-1 Principal Reduction Amount: The Class Z Principal Reduction Amount for the Class Z-1 Regular Interest as
determined pursuant to the provisions of the Appendix A.
Class Z-1 Regular Interest: The uncertificated undivided beneficial interest in REMIC I which constitutes a REMIC I
Regular Interest and is entitled to distributions as set forth herein.
Class Z-2 Principal Distribution Amount: For any Distribution Date, the excess, if any, of the Class Z-2 Principal
Reduction Amount for such Distribution Date over the principal portion of Realized Losses allocated to the Class Z-2 Regular Interest
on such Distribution Date.
-16-
Class Z-2 Principal Reduction Amount: The Class Z Principal Reduction Amount for the Class Z-2 Regular Interest as
determined pursuant to the provisions of the Appendix A.
Class Z-2 Regular Interest: The uncertificated undivided beneficial interest in REMIC I which constitutes a REMIC I
Regular Interest and is entitled to distributions as set forth herein.
Class Z-3 Principal Distribution Amount: For any Distribution Date, the excess, if any, of the Class Z-3 Principal
Reduction Amount for such Distribution Date over the principal portion of Realized Losses allocated to the Class Z-3 Regular Interest
on such Distribution Date .
Class Z-3 Principal Reduction Amount: The Class Z Principal Reduction Amount for the Class Z-3 Regular Interest as
determined pursuant to the provisions of the Appendix A.
Class Z-3 Regular Interest: The uncertificated undivided beneficial interest in REMIC I which constitutes a REMIC I
Regular Interest and is entitled to distributions as set forth herein.
Class Z-4 Principal Distribution Amount: For any Distribution Date, the excess, if any, of the Class Z-4 Principal
Reduction Amount for such Distribution Date over the principal portion of Realized Losses allocated to the Class Z-4 Regular Interest
on such Distribution Date.
Class Z-4 Principal Reduction Amount: The Class Z Principal Reduction Amount for the Class Z-4 Regular Interest as
determined pursuant to the provisions of the Appendix A.
Class Z-4 Regular Interest: The uncertificated undivided beneficial interest in REMIC I which constitutes a REMIC I
Regular Interest and is entitled to distributions as set forth herein.
Closing Date: February 28, 2007.
Conforming Loans: The Group 4 Mortgage Loans.
Corporate Trust Office: With respect to the Trustee, the designated 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 Agreement is located at 00 Xxxxxxxxxx Xxxxxx, Xx. Xxxx, Xxxxxxxxx 00000, Attention: Corporate Trust—Structured
Finance, CSFB ARMT 2007-1. With respect to the Trust Administrator, the designated office of the Trust Administrator 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 Agreement is located at 0000 Xxx Xxxxxxxxx Xxxx, Xxxxxxxx, XX 00000, Attention: CSFB ARMT 2007-1, except for
purposes of Section 6.06 and certificate transfer purposes, such term shall mean the office or agency of the Trust Administrator
located at 0xx Xxxxxx xxx Xxxxxxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx 00000, Attention: CSFB ARMT 2007-1.
Countrywide: Countrywide Home Loans Servicing LP and its successors and assigns.
Countrywide Serviced Mortgage Loans: The Mortgage Loans identified as such on the Mortgage Loan Schedule, for which
Countrywide is the applicable Designated Servicer.
Countrywide Reconstituted Servicing Agreement: That certain Reconstituted Servicing Agreement, dated as of
February 1, 2007, among DLJMC, Countrywide, the Master Servicer and the Trust Administrator, and acknowledged by the Trustee.
-17-
Countrywide Underlying Servicing Agreement: The "Servicing Agreement" referred to in the Countrywide Reconstituted
Servicing Agreement.
Current Interest: For any Class of LIBOR Certificates and Distribution Date, the amount of interest accruing at the
applicable Pass-Through Rate on the related Class Principal Balance of such Class during the related Accrual Period; provided, that
as to each Class of LIBOR Certificates, Current Interest shall be reduced by a pro rata portion of any Interest Shortfalls to the
extent not covered by Monthly Excess Interest.
Custodial Agreement: As defined in the Standard Terms. As of the date hereof, the Custodial Agreement under this
Agreement will be the LaSalle Bank Custodial Agreement.
Custodian: As defined in the Standard Terms. Initially, LaSalle shall serve as Custodian for all of the Mortgage
Loans.
Deferred Amount: For any Class of LIBOR Certificates and Distribution Date, will equal the amount by which (x) the
aggregate of the Applied Loss Amounts previously applied in reduction of the Class Principal Balance thereof exceeds (y) the sum of
(i) the aggregate of amounts previously paid in reimbursement thereof and (ii) amounts added to the Class Principal Balances thereof
pursuant to Section 4.03(a)(ii) on all prior Distribution Dates, including such Distribution Date.
Deposit Amount: As defined in Section 4.08(e) or Section 4.09(e) herein, as applicable.
Depositor: Credit Suisse First Boston Mortgage Securities Corp., a Delaware corporation, or its successor in
interest.
Depository Agreement: The Letter of Representation dated as of the Closing Date by and among DTC, the Depositor and
the Trust Administrator for the benefit of the Trustee.
Designated Mortgage Loans: The Countrywide Serviced Mortgage Loans, unless any such Mortgage Loan is no longer
serviced by Countrywide under the Countrywide Servicing Agreement, the Fifth Third Serviced Mortgage Loans, unless any such Mortgage
Loan is no longer serviced by Fifth Third under the Fifth Third Servicing Agreement, the First Horizon Serviced Mortgage Loans,
unless any such Mortgage Loan is no longer serviced by First Horizon under the First Horizon Servicing Agreement, the IndyMac
Serviced Mortgage Loans, unless any such Mortgage Loan is no longer serviced by IndyMac under the IndyMac Reconstituted Servicing
Agreement, the SunTrust Serviced Mortgage Loans, unless any such Mortgage Loan is no longer serviced by SunTrust under the SunTrust
Reconstituted Servicing Agreement, the Wachovia Serviced Mortgage Loans, unless any such Mortgage Loan is no longer serviced by
Wachovia under the Wachovia Servicing Agreement and the WaMu Bank Serviced Mortgage Loans, unless any such Mortgage Loan is no longer
serviced by WaMu Bank under the WaMu Bank Servicing Agreement.
Designated Servicer: Each of Countrywide, Fifth Third, First Horizon, IndyMac, SunTrust, Wachovia and WaMu Bank, as
applicable.
Designated Servicing Agreement: Each of the Countrywide Reconstituted Servicing Agreement, Fifth Third
Reconstituted Servicing Agreement, First Horizon Reconstituted Servicing Agreement, IndyMac Reconstituted Servicing Agreement,
SunTrust Reconstituted Servicing Agreement, Wachovia Reconstituted Servicing Agreement and WaMu Bank Reconstituted Servicing
Agreement, as applicable.
-18-
Economic Residual Floater Certificate: As set forth in the Preliminary Statement.
ERISA Restricted Certificate: As set forth in the Preliminary Statement.
Exchangeable Certificates: Not applicable.
Fifth Third: Fifth Third Mortgage Company and its successors and assigns.
Fifth Third Serviced Mortgage Loans: The Mortgage Loans identified as such on the Mortgage Loan Schedule, for which
Fifth Third is the applicable Designated Servicer.
Fifth Third Reconstituted Servicing Agreement: That certain Reconstituted Servicing Agreement, dated as of
February 1, 2007, among DLJMC, Fifth Third, the Master Servicer and the Trust Administrator, and acknowledged by the Trustee.
Fifth Third Underlying Servicing Agreement: The "Servicing Agreement" referred to in the Fifth Third Reconstituted
Servicing Agreement.
First Horizon: First Horizon Home Loan Corporation and its successors and assigns.
First Horizon Serviced Mortgage Loans: The Mortgage Loans identified as such on the Mortgage Loan Schedule, for
which First Horizon is the applicable Designated Servicer.
First Horizon Reconstituted Servicing Agreement: That certain Reconstituted Servicing Agreement dated as of
February 1, 2007 among DLJMC, First Horizon, the Master Servicer and the Trust Administrator, and acknowledged by the Trustee.
First Horizon Underlying Servicing Agreement: The "Servicing Agreement" referred to in the First Horizon
Reconstituted Servicing Agreement.
Floater Certificates: As set forth in the Preliminary Statement.
Floater Loan Group: As set forth in the Preliminary Statement.
Group: When used with respect to the Mortgage Loans, any of Loan Group 1, Loan Group 2, Loan Group 3, Loan Group 4
or Loan Group 5, or with respect to the Certificates, the Class or Classes of Certificates that relate to the corresponding Group or
Groups.
Group 1: With respect to the Mortgage Loans, the pool of adjustable rate Mortgage Loans identified in the Mortgage
Loan Schedule as having been assigned to Group 1 or with respect to the Certificates, the Group 1 Certificates (as specified in the
Preliminary Statement).
Group 1 Senior Liquidation Amount: With respect to any Distribution Date, the aggregate, for each Mortgage Loan in
Loan Group 1 which became a Liquidated Mortgage Loan during the prior calendar month, of the lesser of (i) the Group 1 Senior
Percentage of the Stated Principal Balance of such Mortgage Loan and (ii) the applicable Senior Prepayment Percentage of the
Liquidation Principal with respect to such Mortgage Loan.
Group 1 Senior Percentage: With respect to any Distribution Date, the percentage equivalent of a fraction the
numerator of which is the aggregate Class Principal Balance of the Group 1 Certificates immediately prior to such Distribution Date
and the denominator of which is the aggregate of the Stated Principal Balances of the Mortgage Loans in Loan Group 1 as of the first
day of the related Collection Period (excluding any Group 1 Mortgage Loans that were subject to a Payoff, the principal of which was
distributed on the Distribution Date preceding the current Distribution Date); provided, however, in no event will the Group 1 Senior
Percentage exceed 100%.
-19-
Group 1 Senior Principal Distribution Amount: With respect to any Distribution Date, the sum of (i) the Group 1
Senior Percentage of the Principal Payment Amount for Loan Group 1, (ii) the applicable Senior Prepayment Percentage of the Principal
Prepayment Amount for Loan Group 1, and (iii) the Group 1 Senior Liquidation Amount.
Group 1 Subordinate Percentage: For any Distribution Date, the excess of 100% over the Group 1 Senior Percentage.
Group 2: With respect to the Mortgage Loans, the pool of adjustable rate Mortgage Loans identified in the Mortgage
Loan Schedule as having been assigned to Group 2 or with respect to the Certificates, the Group 2 Certificates (as specified in the
Preliminary Statement).
Group 2 Senior Liquidation Amount: With respect to any Distribution Date, the aggregate, for each Mortgage Loan in
Loan Group 2 which became a Liquidated Mortgage Loan during the prior calendar month, of the lesser of (i) the Group 2 Senior
Percentage of the Stated Principal Balance of such Mortgage Loan and (ii) the applicable Senior Prepayment Percentage of the
Liquidation Principal with respect to such Mortgage Loan.
Group 2 Senior Percentage: With respect to any Distribution Date, the percentage equivalent of a fraction the
numerator of which is the aggregate Class Principal Balance of the Group 2 Certificates immediately prior to such Distribution Date
and the denominator of which is the aggregate of the Stated Principal Balances of the Mortgage Loans in Loan Group 2 as of the first
day of the related Collection Period (excluding any Group 2 Mortgage Loans that were subject to a Payoff, the principal of which was
distributed on the Distribution Date preceding the current Distribution Date); provided, however, in no event will the Group 2 Senior
Percentage exceed 100%.
Group 2 Senior Principal Distribution Amount: With respect to any Distribution Date, the sum of (i) the Group 2
Senior Percentage of the Principal Payment Amount for Loan Group 2, (ii) the applicable Senior Prepayment Percentage of the Principal
Prepayment Amount for Loan Group 2, and (iii) the Group 2 Senior Liquidation Amount.
Group 2 Subordinate Percentage: For any Distribution Date, the excess of 100% over the Group 2 Senior Percentage.
Group 3: With respect to the Mortgage Loans, the pool of adjustable rate Mortgage Loans identified in the Mortgage
Loan Schedule as having been assigned to Group 3 or with respect to the Certificates, the Group 3 Certificates (as specified in the
Preliminary Statement).
Group 3 Senior Liquidation Amount: With respect to any Distribution Date, the aggregate, for each Mortgage Loan in
Loan Group 3 which became a Liquidated Mortgage Loan during the prior calendar month, of the lesser of (i) the Group 3 Senior
Percentage of the Stated Principal Balance of such Mortgage Loan and (ii) the applicable Senior Prepayment Percentage of the
Liquidation Principal with respect to such Mortgage Loan.
Group 3 Senior Percentage: With respect to any Distribution Date, the percentage equivalent of a fraction the
numerator of which is the aggregate Class Principal Balance of the Group 3 Certificates immediately prior to such Distribution Date
and the denominator of which is the aggregate of the Stated Principal Balances of the Mortgage Loans in Loan Group 3, as of the first
day of the related Collection Period (excluding any such Mortgage Loans that were subject to a Payoff, the principal of which was
distributed on the Distribution Date preceding the current Distribution Date); provided, however, in no event will the Group 3 Senior
Percentage exceed 100%.
-20-
Group 3 Senior Principal Distribution Amount: With respect to any Distribution Date, the sum of (i) the Group 3
Senior Percentage of the Principal Payment Amount for Loan Group 3, (ii) the applicable Senior Prepayment Percentage of the Principal
Prepayment Amount for Loan Group 3, and (iii) the Group 3 Senior Liquidation Amount.
Group 3 Subordinate Percentage: For any Distribution Date, the excess of 100% over the Group 3 Senior Percentage.
Group 4: With respect to the Mortgage Loans, the pool of adjustable rate Mortgage Loans identified in the Mortgage
Loan Schedule as having been assigned to Group 4 or with respect to the Certificates, the Group 4 Certificates (as specified in the
Preliminary Statement).
Group 4 Senior Liquidation Amount: With respect to any Distribution Date, the aggregate, for each Mortgage Loan in
Loan Group 4 which became a Liquidated Mortgage Loan during the prior calendar month, of the lesser of (i) the Group 4 Senior
Percentage of the Stated Principal Balance of such Mortgage Loan and (ii) the applicable Senior Prepayment Percentage of the
Liquidation Principal with respect to such Mortgage Loan.
Group 4 Senior Percentage: With respect to any Distribution Date, the percentage equivalent of a fraction the
numerator of which is the aggregate Class Principal Balance of the Group 4 Certificates immediately prior to such Distribution Date
and the denominator of which is the aggregate of the Stated Principal Balances of the Mortgage Loans in Loan Group 4, as of the first
day of the related Collection Period (excluding any such Mortgage Loans that were subject to a Payoff, the principal of which was
distributed on the Distribution Date preceding the current Distribution Date); provided, however, in no event will the Group 4 Senior
Percentage exceed 100%.
Group 4 Senior Principal Distribution Amount: With respect to any Distribution Date, the sum of (i) the Group 4
Senior Percentage of the Principal Payment Amount for Loan Group 4, (ii) the applicable Senior Prepayment Percentage of the Principal
Prepayment Amount for Loan Group 4, and (iii) the Group 4 Senior Liquidation Amount.
Group 4 Subordinate Percentage: For any Distribution Date, the excess of 100% over the Group 4 Senior Percentage.
Group 5: With respect to the Mortgage Loans, the pool of adjustable rate Mortgage Loans identified in the Mortgage
Loan Schedule as having been assigned to Group 5 or with respect to the Certificates, the Group 5 Certificates.
Group 5 Certificates: As set forth in the Preliminary Statement.
Group 5 Credit Support Depletion Date: The first Distribution Date on which the aggregate Class Principal Balance
of the Group 5 Subordinate Certificates has been or will be reduced to zero.
Group 5 Interest Rate Cap Account: The separate Eligible Account created and initially maintained by the Trust
Administrator pursuant to Section 4.10 in the name of the Trust Administrator for the benefit of the Certificateholders and
designated "Xxxxx Fargo Bank, N.A. in trust for registered holders of Adjustable Rate Mortgage Trust 2007-1, Adjustable Rate
Mortgage-Backed Pass Through Certificates, Series 2007-1, Group 5 Certificates" Funds in the Group 5 Interest Rate Cap Account shall
be held in trust for the Certificateholders for the uses and purposes set forth in this Agreement. The Group 5 Interest Rate Cap
Account will not be an asset of any REMIC. Ownership of the Group 5 Interest Rate Cap Account is evidenced by the Class 5-X
Certificates.
-21-
Group 5 Interest Rate Cap Agreement: The interest rate cap agreement relating to the Group 5 Certificates consisting
of the ISDA Master Agreement, the Schedule and the Credit Support Annex, each dated as of the Closing Date and the Confirmations
related thereto, between the Trust Administrator on behalf of the Trust and the Group 5 Interest Rate Cap Counterparty, as such
agreement may be amended and supplemented in accordance with its terms and any replacement Group 5 Interest Rate Cap Agreement
acceptable to the Depositor and the Trust Administrator.
Group 5 Interest Rate Cap Counterparty: Credit Suisse International, or any successor in interest thereto under the
Group 5 Interest Rate Cap Agreement.
Group 5 Senior Certificates: As set forth in the Preliminary Statement.
Group 5 Senior Enhancement Percentage: For any Distribution Date, the fraction, expressed as a percentage, the
numerator of which is the sum of the aggregate Class Principal Balance of the Class M Certificates and the Overcollateralization
Amount (which, for purposes of this definition only, shall not be less than zero), in each case after giving effect to payments on
such Distribution Date (assuming no Trigger Event has occurred), and the denominator of which is the Aggregate Loan Group Balance for
Loan Group 5 for such Distribution Date.
Group 5 Senior Principal Payment Amount: For any Distribution Date on or after the Stepdown Date and as long as a
Trigger Event has not occurred with respect to such Distribution Date, will be the amount, if any, by which (x) the aggregate Class
Principal Balance of the Group 5 Senior Certificates, immediately prior to such Distribution Date exceeds (y) the lesser of (A) the
product of (i) 83.40% and (ii) the Aggregate Loan Group Balance for Loan Group 5 for such Distribution Date and (B) the amount, if
any, by which (i) the Aggregate Loan Group Balance for Loan Group 5 for such Distribution Date exceeds (ii) 0.50% of the Aggregate
Loan Group Balance for Loan Group 5 as of the Cut-off Date.
Group 5 Subordinate Certificates: As set forth in the Preliminary Statement.
IndyMac: IndyMac Bank, F.S.B. and its successors and assigns.
IndyMac Serviced Mortgage Loans: The Mortgage Loans identified as such on the Mortgage Loan Schedule, for which
IndyMac is the applicable Servicer.
IndyMac Reconstituted Servicing Agreement: That certain Reconstituted Servicing Agreement dated as of February 1,
2007 among DLJMC, IndyMac, the Master Servicer and the Trust Administrator, and acknowledged by the Trustee.
IndyMac Underlying Servicing Agreement: The "Servicing Agreement" referred to in the IndyMac Reconstituted
Servicing Agreement.
Initial Bankruptcy Loss Coverage Amount: $205,020.36.
-22-
Initial Class Principal Balance: As set forth in the Preliminary Statement.
Initial Cut-off Date: February 1, 2007.
Initial Fraud Loss Coverage Amount: $12,176,367.26.
Initial Special Hazard Loss Coverage Amount: $6,088,183.63.
Interest Distribution Amount: With respect to any Distribution Date and interest bearing Class of Group 1, Group 2,
Group 3, Group 4 and Class C-B Certificates, the sum of (i) one month's interest accrued during the related Accrual Period at the
applicable Pass-Through Rate for such Class on the related Class Principal Balance or Class Notional Amount, as applicable, subject
to reduction pursuant to Section 4.01(I)(B), and (ii) any Class Unpaid Interest Amounts for such Class and Distribution Date.
Interest Remittance Amount: For any Distribution Date and the Mortgage Loans in Loan Group 5, an amount equal to
the sum of (1) all interest collected (other than Payaheads) or advanced in respect of Scheduled Payments on the Mortgage Loans in
such Loan Group during the related Collection Period, the interest portion of Payaheads previously received on the Mortgage Loans in
such Loan Group and intended for application in the related Collection Period and interest portion of all Payoffs (net of Payoff
Interest and Prepayment Interest Excess for such Distribution Date) and Curtailments received on the Mortgage Loans in such Loan
Group during the related Prepayment Period, less (x) the applicable Expense Fees with respect to such Mortgage Loans and
(y) unreimbursed Advances and other amounts due to the Master Servicer, the applicable Servicer and the Trust Administrator with
respect to such Mortgage Loans, to the extent allocable to interest, (2) all Compensating Interest Payments paid by a Servicer with
respect to the Mortgage Loans in such Loan Group with respect to the related Prepayment Period, (3) the portion of any Substitution
Adjustment Amount and Purchase Price paid with respect to the Mortgage Loans in such Loan Group during the related Collection Period,
in each case allocable to interest and the proceeds of any purchase of such Mortgage Loans by the Terminating Entity pursuant to
Section 11.01 in an amount not exceeding the interest portion of the Par Value with respect to such Mortgage Loans, and (4) all Net
Liquidation Proceeds and recoveries (net of unreimbursed Advances, Servicing Advances and expenses, to the extent allocable to
interest, and unpaid Expense Fees), if any, collected with respect to the Mortgage Loans in such Loan Group during the prior calendar
month, to the extent allocable to interest.
Interest Shortfall: For any Distribution Date and the Mortgage Loans in Loan Group 5, an amount equal to the
aggregate shortfall, if any, in collections of interest (adjusted to the related Net Mortgage Rate) on Mortgage Loans in Loan Group 5
resulting from (a) Principal Prepayments received during the related Prepayment Period after giving effect to the Compensating
Interest Payment for such Distribution Date and (b) interest payments on certain of the Mortgage Loans in Loan Group 5 being limited
pursuant to the provisions of the Relief Act.
LaSalle: LaSalle Bank, National Association.
LaSalle Bank Custodial Agreement: That certain Custodial Agreement dated as of February 1, 2007 among LaSalle, the
Trustee and the Trust Administrator.
LIBOR Certificates: As set forth in the Preliminary Statement.
Loan Group: Any of Loan Group 1, Loan Group 2, Loan Group 3, Loan Group 4 or Loan Group 5, as applicable. Loan
Group 1, Loan Group 2, Loan Group 3 and Loan Group 4 together will constitute one sub-trust and Loan Group 5 will constitute another
sub-trust.
-23-
Loan Group 1: All Mortgage Loans identified as Loan Group 1 Mortgage Loans on the Mortgage Loan Schedule.
Loan Group 2: All Mortgage Loans identified as Loan Group 2 Mortgage Loans on the Mortgage Loan Schedule.
Loan Group 3: All Mortgage Loans identified as Loan Group 3 Mortgage Loans on the Mortgage Loan Schedule.
Loan Group 4: All Mortgage Loans identified as Loan Group 4 Mortgage Loans on the Mortgage Loan Schedule.
Loan Group 5: All Mortgage Loans identified as Loan Group 5 Mortgage Loans on the Mortgage Loan Schedule.
Marker Rate: With respect to the Class 5-X Certificates and the REMIC II Regular Interests LT1, LT2, LT3 and LT4
and any Distribution Date, a per annum rate equal to two (2) times the weighted average of the Uncertificated REMIC II Pass-Through
Rates for REMIC II Regular Interest LT2 and REMIC II Regular Interest LT3.
Master Servicer: Xxxxx Fargo.
Maturity Date: The Distribution Date occurring in March 2037.
Maximum Interest Rate: With respect to the Group 5 Certificates and any Distribution Date, an annual rate equal to
the weighted average of the Maximum Mortgage Rates of the Mortgage Loans in Loan Group 5 minus the weighted average Expense Fee Rate
of the Mortgage Loans in Loan Group 5.
Modification Oversight Agent: SPS, and its successors and permitted assigns.
Monthly Excess Cashflow: For any Distribution Date, an amount equal to the sum of the Monthly Excess Interest,
Overcollateralization Release Amount, if any for such date, and any Principal Payment Amount remaining after the application of items
(i) through (v) in the distribution thereof pursuant to Section 4.01(II)(a), (b) or (c), as applicable.
Monthly Excess Interest: For any Distribution Date, any Interest Remittance Amount remaining after the application
of items (i) through (xi) in the distribution thereof, pursuant to Section 4.01(II)(a).
Net Cumulative Realized Loss Amount: For any Distribution Date, an amount equal to the cumulative Realized Losses
incurred on the Group 5 Mortgage Loans from the Initial Cut-off Date through the end of the calendar month preceding such
Distribution Date, less the amount of payments made to the Principal Remittance Amount from the Group 5 Interest Rate Cap Agreement
pursuant to Section 4.07(c)(3) on all prior Distribution Dates.
Net Excess Spread: With respect to any Distribution Date and Loan Group 5, a fraction, expressed as a percentage,
the numerator of which is equal to the excess of (x) the Aggregate Loan Group Balance for Loan Group 5 for the immediately preceding
Distribution Date, multiplied by the product of (A) the Net WAC Rate for Loan Group 5 and (B) the actual number of days elapsed in
the related Accrual Period divided by 360 over (y) the aggregate Current Interest for Loan Group 5 for such Distribution Date, and
the denominator of which is an amount equal to the Aggregate Loan Group Balance for Loan Group 5 for the immediately preceding
Distribution Date, multiplied by the actual number of days elapsed in the related Accrual Period divided by 360.
-24-
Net Funds Cap: For any Distribution Date and the LIBOR Certificates, will be a per annum rate equal to (a) a
fraction, expressed as a percentage, the numerator of which is the product of (1) the Optimal Interest Remittance Amount for such
date and (2) 12, and the denominator of which is the Aggregate Loan Group Balance for Loan Group 5 (excluding any such Mortgage Loans
that were subject to a Payoff, the principal of which was distributed on the Distribution Date preceding the current Distribution
Date) for the immediately preceding Distribution Date (or, in the case of the first Distribution Date, the Aggregate Loan
Group Balance for Loan Group 5 as of the Cut-off Date, multiplied by (b) a fraction, the numerator of which is 30 and the denominator
of which is the actual number of days in the related Accrual Period.
Net Interest Shortfalls: For any Distribution Date and any Pass-Through Loan Group, the sum of (A) the amount of
interest which would otherwise have been received for a Mortgage Loan in such Loan Group during the prior calendar month that was the
subject of (x) a Relief Act Reduction or (y) a Special Hazard Loss, Fraud Loss or Bankruptcy Loss, after the exhaustion of the
respective amounts of coverage provided by the Class C-B Certificates for those types of losses; and (B) any related Net Prepayment
Interest Shortfalls.
Net Realized Losses: For any Class of Certificates, other than the Floater Certificates, and any Distribution Date,
the excess of (i) the amount of unreimbursed Realized Losses previously allocated to that Class over (ii) the sum of (a) the amount
of any increases to the Class Principal Balance of that Class pursuant to Section 4.03 due to Recoveries and (b) amounts previously
distributed to such Class in respect of Realized Losses pursuant to Section 4.01.
Net Recovery Realized Losses: For any Class of Certificates, other than the Floater Certificates, and any
Distribution Date, the excess of Net Realized Losses for such Distribution Date over the amount distributed in respect of Realized
Losses pursuant to Section 4.01 on that Distribution Date.
Net WAC Rate: For any Distribution Date and any Pass-Through Loan Group, the Weighted Average Pass-Through Rate for
such Loan Group for such Distribution Date.
In addition, for any purpose for which the Net WAC Rate is calculated, the interest rate on the Mortgage Loans shall
be appropriately adjusted to account for the difference between any counting convention used with respect to the Mortgage Loans and
any counting convention used with respect to a REMIC Regular Interest.
NIM Note: Any debt instrument issued by a NIM Trust.
NIM Trust: With respect to any Floater Loan Group, any trust created to hold the Economic Residual Floater
Certificates for such Floater Loan Group and issue debt instruments that are secured by distributions on such Economic Residual
Floater Certificates.
Notional Amount Certificates: As set forth in the Preliminary Statement.
Offered Certificates: As set forth in the Preliminary Statement.
Optimal Interest Remittance Amount: With respect to any Distribution Date and the Floater Loan Group, the excess of
(i) the product of (1) (x) the weighted average of the Net Mortgage Rates of the Mortgage Loans in Loan Group 5 as of the first day
of the related Collection Period divided by (y) 12 and (2) the Aggregate Loan Group Balance for the Floater Loan Group for the
immediately preceding Distribution Date (excluding any such Mortgage Loans that were subject to a Payoff, the principal of which was
distributed on the Distribution Date preceding the current Distribution Date), over (ii) any expenses that reduce the Interest
Remittance Amount with respect to the Floater Loan Group that did not arise as a result of a default or delinquency of the Mortgage
Loans in the Floater Loan Group or were not taken into account in computing the Expense Fee Rate.
-25-
Overcollateralized Group: As defined in Section 4.07(b).
Pass-Through Certificates: As set forth in the Preliminary Statement.
Pass-Through Loan Group: As set forth in the Preliminary Statement.
Pass-Through Rate: For any interest bearing Class of Certificates, the per annum rate set forth or calculated in
the manner described in the Preliminary Statement. Interest on the Certificates, other than the LIBOR Certificates, will be computed
on the basis of a 360 day year comprised of twelve 30 day months. Interest on the LIBOR Certificates and the Class 5-X Certificates
(to the extent it is entitled to interest from Loan Group 5) will be computed on the basis of a 360-day year and the actual number of
days elapsed in the related Accrual Period.
Physical Certificates: As set forth in the Preliminary Statement.
Prefunded Amount: Not Applicable.
Prefunded Loan Group: Not Applicable.
Prefunding Account: Not Applicable.
Prefunding Period: Not Applicable.
Principal Payment Amount: For any Distribution Date and any Pass-Through Loan Group, the sum of (i) the principal
portion of the Scheduled Payments on the Mortgage Loans in such Loan Group due on the related Due Date, (ii) the principal portion of
repurchase proceeds received with respect to any Mortgage Loan in such Loan Group which was repurchased as permitted or required by
this Agreement during the period beginning on the 15th day of the month preceding such Distribution Date and ending on the 14th day
of the month of such Distribution Date, with notice and receipt of funds three (3) Business Days prior to the 14th day of the month
of such Distribution Date and (iii) any other unscheduled payments of principal which were received on the Mortgage Loans in such
Loan Group during the related calendar month preceding the month of such Distribution Date, other than Principal Prepayments or
Liquidation Principal.
For any Distribution Date and the Floater Loan Group, an amount equal to the Principal Remittance Amount for such
date minus the Overcollateralization Release Amount, if any, for such date.
Principal Prepayment Amount: For any Distribution Date and any Pass-Through Loan Group, the sum of (i) all
Principal Prepayments relating to the Mortgage Loans in such Loan Group which were received during the related Prepayment Period and
(ii) all Recoveries received during the calendar month preceding the month of that Distribution Date.
-26-
Principal Remittance Amount: For any Distribution Date and the Floater Loan Group, an amount equal to the sum of (1)
all principal collected (other than Payaheads) or advanced in respect of Scheduled Payments on the Mortgage Loans in such Loan
Group during the related Collection Period (less unreimbursed Advances, Servicing Advances and other amounts due to the Servicers, the
Trustee, the Master Servicer and the Trust Administrator with respect to the Mortgage Loans in such Loan Group, to the extent
allocable to principal) and the principal portion of Payaheads previously received on the Mortgage Loans in such Loan Group and
intended for application in the related Collection Period, (2) all Principal Prepayments received on the Mortgage Loans in such Loan
Group during the related Prepayment Period, (3) the Purchase Price of each Mortgage Loan in such Loan Group that was repurchased by
the Seller or purchased by the Special Servicer pursuant to Section 3.17(b), during the related Collection Period and the principal
proceeds of any purchase of Mortgage Loans in such Loan Group by the Terminating Entity pursuant to Section 11.01 in an amount not
exceeding the principal portion of the Par Value with respect to such Mortgage Loans, (4) the portion of any Substitution Adjustment
Amount paid with respect to any Deleted Mortgage Loans in such Loan Group during the related Collection Period allocable to
principal, (5) all Net Liquidation Proceeds (net of unreimbursed Advances, Servicing Advances and other expenses, to the extent
allocable to principal) and any other Recoveries collected with respect to the Mortgage Loans in such Loan Group during the preceding
calendar month, to the extent allocable to principal, and (6) amounts, if any, withdrawn from the Group 5 Interest Rate Cap Account
to cover the Net Cumulative Realized Loss Amount for such Distribution Date.
Private Certificates: As set forth in the Preliminary Statement.
Pro Rata Share: With respect to any Distribution Date and any Class of Class C-B Certificates, the portion of the
Subordinate Principal Distribution Amount allocable to such Class, equal to the product of the Subordinate Principal Distribution
Amount on such Distribution Date and a fraction, the numerator of which is the related Class Principal Balance of such Class and the
denominator of which is the aggregate of the Class Principal Balances of the Class C-B Certificates.
Prospectus Supplement: The Prospectus Supplement, dated February 26, 2007, relating to the offering of the Offered
Certificates in the form in which it was or will be filed with the Securities and Exchange Commission pursuant to Rule 424(b) under
the 1933 Act with respect to the offer and sale of the Offered Certificates.
Rating Agency: Each of Xxxxx'x and S&P, or any successor to any of them, so long as such entity is rating any of
the Certificates.
Realized Loss: As defined in the Standard Terms; provided, that Realized Losses allocated to the Class 5-X
Certificates shall be allocated first to the REMIC III Regular Interest 5-X-IO in reduction of the accrued but unpaid interest
thereon until such accrued and unpaid interest shall have been reduced to zero and then to the REMIC III Regular Interest 5-X-PO in
reduction of the principal balance thereof.
Regular Certificates: All of the Certificates other than the Residual Certificates and the Class P Certificates.
REMIC: A "real estate mortgage investment conduit," within the meaning of Section 860D of the Code. Reference
herein to REMIC refers to each REMIC created by the Preliminary Statement.
REMIC Election: An election, for federal income tax purposes, to treat certain assets as a REMIC.
-27-
REMIC I Available Distribution Amount: For each of Loan Group 1, Loan Group 2, Loan Group 3 and Loan Group 4, for
any Distribution Date, the Available Distribution Amount for such Loan Group.
REMIC I Distribution Amount: For any Distribution Date, the REMIC I Available Distribution Amounts shall be deemed
distributed to REMIC III, as the holder of the REMIC I Regular Interests, and to Holders of the Class AR-L Certificates in respect of
Component I thereof, pursuant to Section 4.01(IV)(a)(i), in the following amounts and priority:
(a) To the extent of the REMIC I Available Distribution Amount for Loan Group 1:
(i) first, to Class Y-1 and Class Z-1 Regular Interests and Component I of the Class AR-L
Certificates, concurrently, the Uncertificated Accrued Interest for such Classes remaining unpaid from previous Distribution
Dates, pro rata according to their respective shares of such unpaid amounts;
(ii) second, to the Class Y-1 and Class Z-1 Regular Interests and Component I of the Class AR-L
Certificates, concurrently, the Uncertificated Accrued Interest for such Classes for the current Distribution Date, pro rata
according to their respective Uncertificated Accrued Interest;
(iii) third, to Component I of the Class AR-L Certificates, until the Uncertificated Principal Balance
thereof has been reduced to zero; and
(iv) fourth, to the Class Y-1 and Class Z-1 Regular Interests, the Class Y-1 Principal Distribution
Amount and the Class Z-1 Principal Distribution Amount, respectively.
(b) To the extent of the REMIC I Available Distribution Amount for Loan Group 2:
(i) first, to the Class Y-2 and Class Z-2 Regular Interests, concurrently, the Uncertificated Accrued
Interest for such Classes remaining unpaid from previous Distribution Dates, pro rata according to their respective shares
of such unpaid amounts;
(ii) second, to the Class Y-2 and Class Z-2 Regular Interests, concurrently, the Uncertificated Accrued
Interest for such Classes for the current Distribution Date, pro rata according to their respective Uncertificated Accrued
Interest; and
-28-
(iii) third, to the Class Y-2 and Class Z-2 Regular Interests, the Class Y-2 Principal Distribution
Amount and the Class Z-2 Principal Distribution Amount, respectively.
(c) To the extent of the REMIC I Available Distribution Amount for Loan Group 3:
(i) first, to the Class Y-3 and Class Z-3 Regular Interests, concurrently, the Uncertificated Accrued
Interest for such Classes remaining unpaid from previous Distribution Dates, pro rata according to their respective shares
of such unpaid amounts;
(ii) second, to the Class Y-3 and Class Z-3 Regular Interests, concurrently, the Uncertificated Accrued
Interest for such Classes for the current Distribution Date, pro rata according to their respective Uncertificated Accrued
Interest; and
(iii) third, to the Class Y-3 and Class Z-3 Regular Interests, the Class Y-3 Principal Distribution
Amount and the Class Z-3 Principal Distribution Amount, respectively.
(d) To the extent of the REMIC I Available Distribution Amount for Loan Group 4:
(i) first, to the Class Y-4 and Class Z-4 Regular Interests, concurrently, the Uncertificated Accrued
Interest for such Classes remaining unpaid from previous Distribution Dates, pro rata according to their respective shares
of such unpaid amounts;
(ii) second, to the Class Y-4 and Class Z-4 Regular Interests, concurrently, the Uncertificated Accrued
Interest for such Classes for the current Distribution Date, pro rata according to their respective Uncertificated Accrued
Interest; and
(iii) third, to the Class Y-4 and Class Z-4 Regular Interests, the Class Y-4 Principal Distribution
Amount and the Class Z-4 Principal Distribution Amount, respectively.
(e) To the extent of the REMIC I Available Distribution Amounts for such Distribution Date remaining after
payment of the amounts pursuant to paragraphs (a), (b), (c) and (d) of this definition of "REMIC I Distribution Amount":
(i) first, to each Class of REMIC I Class Y and Class Z Regular Interests, pro rata according to the
amount of unreimbursed Realized Losses allocable to principal previously allocated to each such Class; provided, however,
that any amounts distributed pursuant to this paragraph (e)(i) of this definition of "REMIC I Distribution Amount" shall not
cause a reduction in the Uncertificated Principal Balances of any of the Class Y and Class Z Regular Interests; and
(ii) second, to the Class AR-L Certificates in respect of Component I thereof, any remaining amount.
REMIC I Realized Losses: Realized Losses on the Group 1, Group 2, Group 3 and Group 4 Mortgage Loans shall be
allocated to the REMIC I Regular Interests as follows: (1) the interest portion of Realized Losses and Net Interest Shortfalls on the
Group 1 Loans, if any, shall be allocated between the Class Y-1 and Class Z-1 Regular Interests pro rata according to the amount of
interest accrued but unpaid thereon, in reduction thereof; (2) the interest portion of Realized Losses and Net Interest Shortfalls on
the Group 2 Loans, if any, shall be allocated between the Class Y-2 and Class Z-2 Regular Interests pro rata according to the amount
of interest accrued but unpaid thereon, in reduction thereof; (3) the interest portion of Realized Losses and Net Interest Shortfalls
on the Group 3 Loans, if any, shall be allocated between the Class Y-3 and Class Z-3 Regular Interests pro rata according to the
amount of interest accrued but unpaid thereon, in reduction thereof; and (4) the interest portion of Realized Losses and Net Interest
Shortfalls on the Group 4 Loans, if any, shall be allocated between the Class Y-4 and Class Z-4 Regular Interests 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 in such Group and allocated pursuant to the succeeding sentences. The principal portion
of Realized Losses with respect to the Group 1, Group 2, Group 3 and Group 4 Mortgage Loans shall be allocated to the REMIC I Regular
Interests as follows: (1) the principal portion of Realized Losses on the Group 1 Loans shall be allocated, first, to the Class Y-1
Regular Interest to the extent of the Class Y-1 Principal Reduction Amount in reduction of the Uncertificated Principal Balance of
such Regular Interest and, second, the remainder, if any, of such principal portion of such Realized Losses shall be allocated to the
Class Z-1 Regular Interest in reduction of the Uncertificated Principal Balance thereof; (2) the principal portion of Realized Losses
-29-
on the Group 2 Loans shall be allocated, first, to the Class Y-2 Regular Interest to the extent of the Class Y-2 Principal Reduction
Amount in reduction of the Uncertificated Principal Balance of such Regular Interest and, second, the remainder, if any, of such
principal portion of such Realized Losses shall be allocated to the Class Z-2 Regular Interest in reduction of the Uncertificated
Principal Balance thereof; (3) the principal portion of Realized Losses on the Group 3 Loans shall be allocated, first, to the
Class Y-3 Regular Interest to the extent of the Class Y-3 Principal Reduction Amount in reduction of the Uncertificated Principal
Balance of such Regular Interest and, second, the remainder, if any, of such principal portion of such Realized Losses shall be
allocated to the Class Z-3 Regular Interest in reduction of the Uncertificated Principal Balance thereof; and (4) the principal
portion of Realized Losses on the Group 4 Loans shall be allocated, first, to the Class Y-4 Regular Interest to the extent of the
Class Y-4 Principal Reduction Amount in reduction of the Uncertificated Principal Balance of such Regular Interest and, second, the
remainder, if any, of such principal portion of such Realized Losses shall be allocated to the Class Z-4 Regular Interest in
reduction of the Uncertificated Principal Balance thereof. For any Distribution Date, reductions in the Uncertificated Principal
Balances of the Class Y and Class Z Regular Interests pursuant to this definition of Realized Loss shall be determined, and shall be
deemed to occur, prior to any reductions of such Uncertificated Principal Balances by distributions on such Distribution Date.
REMIC II Available Distribution Amount: The Available Distribution Amount for Loan Group 5.
REMIC II Distribution Amount: For any Distribution Date, the REMIC II Available Distribution Amount shall be deemed
distributed to REMIC III, as the holder of the REMIC II Regular Interests, and to Holders of the Class AR-L Certificates in respect
of Component II thereof, pursuant to Section 4.01(IV)(a)(ii), in the following amounts and priority:
(a) first, to the REMIC II 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; and
(b) second:
(i) to the REMIC II Regular Interests LT2, LT3 and LT4, their respective Principal Distribution
Amounts;
(ii) to the REMIC II Regular Interest LT1 its Principal Distribution Amount;
(iii) any remainder to the REMIC II Regular Interest LT1, until the Uncertificated Principal Balance
thereof has been reduced to zero;
(iv) any remainder to the REMIC II Regular Interests LT2, LT3 and LT4, pro rata, according to their
respective Uncertificated Principal Balances as reduced by the distributions made pursuant to (i) above, until their
respective Uncertificated Principal Balances have been reduced to zero; and
(v) any remaining amounts to the Holders of the Class AR-L Certificates in respect of Component II
thereof;
-30-
(c) To the extent of the REMIC II Available Distribution Amounts for such Distribution Date remaining after
payment of the amounts pursuant to paragraphs (a) and (b) of this definition of "REMIC II Distribution Amount" as follows:
(i) first, to the REMIC II Regular Interests LT1, LT2, LT3 and LT4, pro rata, to the extent of any
Realized Losses allocated to such Regular Interests on such Distribution Date or any prior Distribution Date and not
previously reimbursed pursuant to this paragraph; provided, however, that any amounts distributed pursuant to this paragraph
(c)(i) of this definition of "REMIC II Distribution Amount" shall not cause a reduction in the Uncertificated Principal
Balance of any of the REMIC II Regular Interests LT1, LT2, LT3 and LT4; and
(ii) second, to the Class AR-L Certificates in respect of Component II thereof, any remaining amount.
REMIC II Principal Reduction Amounts: For any Distribution Date, the amounts by which the principal balances of the
REMIC II Regular Interests LT1, LT2, LT3 and LT4, respectively, will be reduced on such Distribution Date by the allocation of
Realized Losses and the distribution of principal, determined as follows:
For purposes of the succeeding formulas the following symbols shall have the meanings set forth below:
Y1 = the aggregate principal balance of the REMIC II Regular Interests LT1 after distributions on the prior Distribution
Date.
Y2 = the principal balance of the REMIC II Regular Interest LT2 after distributions on the prior Distribution Date.
Y3 = the principal balance of the REMIC II Regular Interest LT3 after distributions on the prior Distribution Date.
Y4 = the principal balance of the REMIC II Regular Interest LT4 after distributions on the prior Distribution Date
(note: Y3 = Y4).
ΔY1 = the combined REMIC II Regular Interests LT1 Principal Reduction Amount.
ΔY2 = the REMIC II Regular Interest LT2 Principal Reduction Amount.
ΔY3 = the REMIC II Regular Interest LT3 Principal Reduction Amount.
ΔY4 = the REMIC II Regular Interest LT4 Principal Reduction Amount.
P0 = the aggregate principal balance of the REMIC II Regular Interests LT1, LT2, LT3 and LT4 after distributions and the
allocation of Realized Losses on the prior Distribution Date.
P1 = the aggregate principal balance of the REMIC II Regular Interests LT1, LT2, LT3 and LT4 after distributions and the
allocation of Realized Losses to be made on such Distribution Date.
ΔP = P0 - P1 = the aggregate of the REMIC II Regular Interests LT1, LT2, LT3 and LT4 Principal Reduction Amounts.
-31-
= the aggregate of the principal portions of Realized Losses to be allocated to, and the principal distributions to be
made on, the Group I Certificates on such Distribution Date (including distributions of accrued and unpaid interest on the Class SB-I
Certificates for prior Distribution Dates).
R0 = the Group 5 Net WAC Rate (stated as a monthly rate) after giving effect to amounts distributed and Realized Losses
allocated on the prior Distribution Date.
R1 = the Group 5 Net WAC Rate (stated as a monthly rate) after giving effect to amounts to be distributed and Realized
Losses to be allocated on such Distribution Date.
γ = (Y2 + Y3)/P0. The initial value of γ on the Closing Date for use on the first Distribution Date shall be 0.0001.
α0 = the lesser of (A) the sum for all Classes of Group 5 LIBOR Certificates of the product for each Class of (i) the
monthly interest rate (as limited by the Net Funds Cap, 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.
α1 = the lesser of (A) the sum for all Classes of Group 5 Certificates of the product for each Class of (i) the monthly
interest rate (as limited by the Net Funds Cap, if applicable) for such Class applicable for distributions to be made on the next
succeeding Distribution Date and (ii) the aggregate Certificate Principal Balance for such Class after distributions and the
allocation of Realized Losses to be made on such Distribution Date and (B) R1*P1.
Then, based on the foregoing definitions:
ΔY1 = ΔP - ΔY2 - ΔY3 - ΔY4;
ΔY2 = (γ/2){( α0R1 - α1R0)/R0R1};
ΔY3 = γΔP - ΔY2; and
ΔY4 = ΔY3.
if both ΔY2 and ΔY3, as so determined, are non-negative numbers. Otherwise:
(1) If ΔY2, as so determined, is negative, then
ΔY2 = 0;
ΔY3 = γ{α1R0P0 - α0R1P1}/{α1R0};
ΔY4 = ΔY3; and
ΔY1 = ΔP - ΔY2 - ΔY3 - ΔY4.
(2) If ΔY3, as so determined, is negative, then
ΔY3 = 0;
ΔY2 = x{ x0X0X0 - x0X0X0 }/{0X0X0X0 - x0X0};
-32-
ΔY4 = ΔY3; and
ΔY1 = ΔP - ΔY2 - ΔY3 - ΔY4.
The Principal Reduction Amount ΔY1 shall be allocated to the REMIC II Regular Interest LT1.
REMIC II Realized Losses: Realized Losses on the Group 5 Mortgage Loans for the related Collection Period shall be
allocated to the REMIC II Regular Interests LT1, LT2, LT3 and LT4, in reduction of the principal balances thereof and interest
accrued thereon, as follows: (i) the interest portion of Realized Losses, if any, shall be allocated pro rata to accrued interest on
the REMIC II Regular Interests LT1, LT2, LT3 and LT4, to the extent of such accrued interest, and (ii) any remaining interest
portions of Realized Losses and any principal portions of Realized Losses shall be treated as principal portions of Realized Losses
and allocated (i) to the REMIC II Regular Interest LT2, REMIC II Regular Interest LT3 and REMIC II Regular Interest LT4, pro rata
according to their respective Principal Reduction Amounts, provided that such allocation to each of the REMIC II Regular Interest
LT2, REMIC II Regular Interest LT3 and REMIC II Regular Interest LT4 shall not exceed their respective Principal Reduction Amounts,
and (ii) any Realized Losses not allocated to any of the REMIC II Regular Interest LT2, REMIC II Regular Interest LT3 and REMIC II
Regular Interest LT4 pursuant to the provisos of clause (i) above shall be allocated to the REMIC II Regular Interest LT1, until the
principal balance thereof shall have been reduced to zero. Any Realized Losses on the Group 5 Mortgage Loans remaining after the
allocations made in the preceding sentences shall be allocated among the Class LT2, Class LT3 and Class LT4 REMIC II Regular
Interests pro-rata according to their respective principal balances as reduced by the allocations in the preceding sentence until
such principal balances shall have been reduced to zero.
REMIC II Regular Interest LT1 Principal Distribution Amount: For any Distribution Date, the excess, if any, of the
REMIC II Regular Interest LT1 Principal Reduction Amount for such Distribution Date over the Realized Losses allocated to the
REMIC II Regular Interest LT1 on such Distribution Date.
REMIC II Regular Interest LT2 Principal Distribution Amount: For any Distribution Date, the excess, if any, of the
REMIC II Regular Interest LT2 Principal Reduction Amount for such Distribution Date over the Realized Losses allocated to the
REMIC II Regular Interest LT2 on such Distribution Date.
REMIC II Regular Interest LT3 Principal Distribution Amount: For any Distribution Date, the excess, if any, of the
REMIC II Regular Interest LT3 Principal Reduction Amount for such Distribution Date over the Realized Losses allocated to the
REMIC II Regular Interest LT3 on such Distribution Date.
REMIC II Regular Interest LT4 Principal Distribution Amount: For any Distribution Date, the excess, if any, of the
REMIC II Regular Interest LT4 Principal Reduction Amount for such Distribution Date over the Realized Losses allocated to the
REMIC II Regular Interest LT4 on such Distribution Date.
REMIC Provisions: The provisions of the federal income tax law relating to REMICs, which appear at Sections 860A
through 860G of the Code, and related provisions and regulations promulgated thereunder, as the foregoing may be in effect from time
to time.
REMIC Regular Interest: Any of the REMIC I Regular Interests, REMIC II Regular Interests and REMIC III Regular
Interests.
-33-
Residual Certificates: As set forth in the Preliminary Statement.
Seller: DLJMC.
Senior Certificates: As set forth in the Preliminary Statement.
Senior Liquidation Amount: The Group 1 Senior Liquidation Amount, the Group 2 Senior Liquidation Amount, the
Group 3 Senior Liquidation Amount or Group 4 Senior Liquidation Amount, as applicable.
Senior Percentage: The Group 1 Senior Percentage, Group 2 Senior Percentage, Group 3 Senior Percentage or Group 4
Senior Percentage, as applicable.
Senior Prepayment Percentage: The Senior Prepayment Percentage for any Distribution Date occurring during the seven
years beginning on the first Distribution Date for each Pass-Through Loan Group will equal 100%. The Senior Prepayment Percentage
for any Distribution Date occurring on or after the seventh anniversary of the first Distribution Date for each such Loan Group will
be as follows: for any Distribution Date in the first year thereafter, the related Senior Percentage plus 70% of the related
Subordinate Percentage for such Distribution Date; for any Distribution Date in the second year thereafter, the related Senior
Percentage plus 60% of the related Subordinate Percentage for such Distribution Date; for any Distribution Date in the third year
thereafter, the related Senior Percentage plus 40% of the related Subordinate Percentage for such Distribution Date; for any
Distribution Date in the fourth year thereafter, the related Senior Percentage plus 20% of the related Subordinate Percentage for
such Distribution Date; and for any Distribution Date after the fourth year thereafter, the related Senior Percentage for such
Distribution Date.
Notwithstanding the foregoing, on any Distribution Date and with respect to each Pass-Through Loan Group, if the
Senior Percentage exceeds the initial related Senior Percentage, the Senior Prepayment Percentage for each Group for that
Distribution Date will equal 100%, (ii) if on or before the Distribution Date in February 2010, the Class C-B Percentage is greater
than or equal to twice the Class C-B Percentage as of the Closing Date, in which case the Senior Prepayment Percentage for each
Group will equal the related Senior Percentage, plus 50% of the related Subordinate Percentage for that Distribution Date, and if
after the Distribution Date in February 2010, the Class C-B Percentage is greater than or equal to twice the Class C-B Percentage as
of the Closing Date, then the Senior Prepayment Percentage for each such Group for such Distribution Date will equal the related
Senior Percentage).
Notwithstanding the foregoing, the Senior Prepayment Percentage for any Pass-Through Loan Group shall equal 100% for
any Distribution Date as to which (i) the outstanding principal balance of the Mortgage Loans in the related Loan Group, delinquent
60 days or more (including all REO Properties and Mortgage Loans in foreclosure) (averaged over the preceding six month period), as a
percentage of the related aggregate Subordinate Component Balance as of such Distribution Date is equal to or greater than 50% or
(ii) cumulative Realized Losses for the Mortgage Loans in the related Loan Group exceed (a) with respect to any Distribution Date
prior to the third anniversary of the first Distribution Date, 20% of the related aggregate Subordinate Component Balance as of the
Closing Date (the "Original Subordinate Principal Balance"), (b) with respect to any Distribution Date on or after the third
anniversary but prior to the eighth anniversary of the first Distribution Date, 30% of the related Original Subordinate Principal
Balance, (c) with respect to any Distribution Date on or after the eighth anniversary but prior to the ninth anniversary of the first
Distribution Date, 35% of the related Original Subordinate Principal Balance, (d) with respect to any Distribution Date on or after
the ninth anniversary but prior to the tenth anniversary of the first Distribution Date, 40% of the related Original Subordinate
Principal Balance, (e) with respect to any Distribution Date on or after the tenth anniversary but prior to the eleventh anniversary
of the first Distribution Date, 45% of the related Original Subordinate Principal Balance and (f) with respect to any Distribution
Date on or after the eleventh anniversary of the first Distribution Date, 50% of the Original Subordinate Principal Balance.
-34-
If the Senior Prepayment Percentage for one Loan Group equals 100% due to the limitations set forth above, then the
Senior Prepayment Percentage for the other Loan Groups will equal 100%.
If on any Distribution Date the allocation to a Class of Senior Certificates then entitled to distributions of
Principal Prepayments and other amounts in the percentage required above would reduce the outstanding Class Principal Balance of that
Class below zero, the distribution to that Class of Senior Certificates of the Senior Prepayment Percentage of those amounts for such
Distribution Date shall be limited to the percentage necessary to reduce the related Class Principal Balance to zero.
Senior Principal Distribution Amount: The Group 1 Senior Principal Distribution Amount, Group 2 Senior Principal
Distribution Amount, Group 3 Senior Principal Distribution Amount or Group 4 Senior Principal Distribution Amount, as applicable.
Series Supplement: This Series Supplement, dated as of February 1, 2007, as amended from time to time.
Servicers: SPS, Xxxxx Fargo, WMMSC and the Special Servicer, to the extent it has taken over the servicing of one
or more Mortgage Loans pursuant to Section 3.17(a), and, in each case, any successor in interest thereto or any successor servicer
appointed as provided herein.
Special Event of Default: An Event of Default under Section 8.01(b) which arises solely from the cumulative effect
of a breach or breaches by WMMSC of its agreements as set forth in clauses (i)(x) through (z), inclusive, of the first paragraph of
Section 2.07(g).
Special Servicer: SPS, and its successors and permitted assigns.
Standard Terms: That certain Standard Terms of Pooling and Servicing Agreement, dated as of February 1, 2007,
attached hereto as Exhibit A.
Startup Day: The Closing Date.
Stepdown Date: The date occurring on the later of (x) the Distribution Date in March 2010 and (y) the first
Distribution Date on which the Group 5 Senior Enhancement Percentage (calculated for this purpose after giving effect to payments or
other recoveries in respect of the Mortgage Loans in Loan Group 5 during the related Collection Period but before giving effect to
payments on the Group 5 Certificates on such Distribution Date) is greater than or equal to 16.60%.
Subordinate Certificates: As set forth in the Preliminary Statement.
Subordinate Component Balance: For any Pass-Through Loan Group, as of any date of determination, the Aggregate Loan
Group Balance of such Loan Group as of such date of determination, minus the sum of the then outstanding aggregate Class Principal
Balance of the related Classes of Class A Certificates.
Subordinate Liquidation Amount: For any Distribution Date and any Pass-Through Loan Group, the excess, if any, of
the aggregate Liquidation Principal of all Mortgage Loans in that Loan Group which became Liquidated Mortgage Loans during the
calendar month preceding the Distribution Date over the Group 1 Senior Liquidation Amount, Group 2 Senior Liquidation Amount, Group 3
Senior Liquidation Amount or Group 4 Senior Liquidation Amount, as applicable, for such Distribution Date.
-00-
Xxxxxxxxxxx Xxxxxxxxxx: With respect to any Distribution Date and any Pass-Through Loan Group, the excess of 100%
over the related Senior Percentage for that Distribution Date.
Subordinate Prepayment Percentage: With respect to any Distribution Date and any Pass-Through Loan Group, 100%
minus the related Senior Prepayment Percentage for such Distribution Date; provided, however, that if the aggregate Class Principal
Balance of the Senior Certificates related to such Loan Group has been reduced to zero, then the Subordinate Prepayment Percentage
for such Loan Group will equal 100%.
Subordinate Principal Distribution Amount: With respect to any Distribution Date, the sum of the following amounts
for each Pass-Through Loan Group: (i) the related Subordinate Percentage of the related Principal Payment Amount, (ii) the related
Subordinate Prepayment Percentage of the related Principal Prepayment Amount, and (iii) the related Subordinate Liquidation Amount;
less the amount of certain cross-collateralization payments as made pursuant to Section 4.07.
Subordination Level: With respect to any Distribution Date and any Class of Class C-B Certificates, the percentage
obtained by dividing the sum of the Class Principal Balances of all Classes of Class C-B Certificates which are subordinate in right
of payment to such Class by the sum of the Class Principal Balances of the Group 1 Certificates, Group 2 Certificates, Group 3
Certificates and Group 4 and Class C-B Certificates, in each case immediately prior to such Distribution Date.
Subsequent Cut-off Date: Not Applicable.
Subsequent Mortgage Loan: Not Applicable.
Subsequent Transfer Agreement: Not Applicable.
Subsequent Transfer Date: Not Applicable.
Substitution Adjustment Amount: As defined in Section 2.03.
SunTrust: SunTrust Mortgage, Inc. and its successors and assigns.
SunTrust Serviced Mortgage Loans: The Mortgage Loans identified as such on the Mortgage Loan Schedule, for which
SunTrust is the applicable Designated Servicer.
SunTrust Reconstituted Servicing Agreement: That certain Reconstituted Servicing Agreement, dated as of February 1,
2007, among DLJMC, SunTrust, the Master Servicer and the Trust Administrator, and acknowledged by the Trustee.
SunTrust Underlying Servicing Agreement: The "Servicing Agreement" referred to in the SunTrust Reconstituted
Servicing Agreement.
Supplemental Interest Account: Not Applicable.
Supplemental Interest Trust: Not Applicable.
Supplemental Interest Trust Payment: Not Applicable.
-36-
Supplemental Interest Trust Trustee: Not Applicable.
Swap Agreement: Not Applicable.
Swap Certificates: Not Applicable.
Swap Counterparty: Not Applicable.
Swap Counterparty Payment: Not Applicable.
Swap Payment Date: Not Applicable.
Targeted Overcollateralization Amount: For any Distribution Date prior to the Stepdown Date, 0.95% of the Aggregate
Loan Group Balance for Loan Group 5 as of the Cut-off Date; with respect to any Distribution Date on or after the Stepdown Date and
with respect to which a Trigger Event is not in effect, the greater of (a) 1.90% of the Aggregate Loan Group Balance for Loan Group 5
for such Distribution Date, or (b) 0.50% of the Aggregate Loan Group Balance for Loan Group 5 as of the Cut-off Date; with respect to
any Distribution Date on or after the Stepdown Date with respect to which a Trigger Event has occurred and is continuing, the
Targeted Overcollateralization Amount for the Distribution Date immediately preceding such Distribution Date.
Trigger Event: A Trigger Event will occur for any Distribution Date if either (i) the Rolling Three Month
Delinquency Rate as of the last day of the related Collection Period equals or exceeds 40.00% of the Group 5 Senior Enhancement
Percentage for such Distribution Date or (ii) the cumulative Realized Losses as a percentage of the Aggregate Loan Group Balance for
Loan Group 5 on the Closing Date for such Distribution Date is greater than the percentage set forth in the following table:
--------------------------------------------- -----------------------------------------------
Range of Distribution Dates Cumulative Loss Percentage
--------------------------------------------- -----------------------------------------------
March 2009 - February 2010 0.30%*
--------------------------------------------- -----------------------------------------------
March 2010 - February 2011 0.75%*
--------------------------------------------- -----------------------------------------------
March 2011 - February 2012 1.30%*
--------------------------------------------- -----------------------------------------------
March 2012 - February 2013 1.85%*
--------------------------------------------- -----------------------------------------------
March 2013 - February 2014 2.15%*
--------------------------------------------- -----------------------------------------------
March 2014 and thereafter 2.20%*
--------------------------------------------- -----------------------------------------------
* The cumulative loss percentages set forth above are applicable to the first Distribution Date in the
corresponding range of Distribution Dates. The cumulative loss percentage for each succeeding Distribution
Date in a range increases incrementally by 1/12 of the positive difference between the percentage
applicable to the first Distribution Date in that range and the percentage applicable to the first
Distribution Date in the succeeding range.
Trust: The trust created pursuant to Section 2.01 this Agreement.
Trust Administrator: Xxxxx Fargo Bank, N.A., a national banking association, not in its individual capacity, but
solely in its capacity as trust administrator for the benefit of the Certificateholders under this Agreement, and any successor
thereto, as provided herein.
Trustee: U.S. Bank National Association, a national banking association, not in its individual capacity, but solely
in its capacity as trustee for the benefit of the Certificateholders under this Agreement, and any successor thereto, as provided
herein.
-37-
Uncertificated Accrued Interest: With respect to any Uncertificated Regular Interest for any Distribution Date, one
month's interest at the related Uncertificated Pass-Through Rate for such Distribution Date, accrued on the Uncertificated Principal
Balance or Uncertificated Notional Amount, as applicable, immediately prior to such Distribution Date. Uncertificated Accrued
Interest for the Uncertificated 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 (to the extent not covered by Compensating Interest Payments) relating to the Mortgage Loans
in any Pass-Through Loan Group for any Distribution Date shall be allocated among the REMIC I Regular Interests, pro rata, based on,
and to the extent of, Uncertificated Accrued Interest, as calculated without application of this sentence. For purposes of
calculating the amount of Uncertificated Accrued Interest for the REMIC II Regular Interests for any Distribution Date, any
Prepayment Interest Shortfalls (to the extent not covered by Compensating Interest Payments) relating to Mortgage Loans in the
Floater Loan Group for any Distribution Date shall be allocated among the REMIC II Regular Interests, pro rata, based on, and to the
extent of, Uncertificated Accrued Interest, as calculated without application of this sentence. Uncertificated Accrued Interest on
the REMIC III Regular Interest 5-X-PO shall be zero. Uncertificated Accrued Interest on the REMIC III Regular Interest 5-X-IO for
each Distribution Date shall equal Accrued Certificate Interest for the Economic Residual Floater Certificates.
Uncertificated Pass-Through Rate: For any REMIC I Regular Interest or REMIC II Regular Interest, the per annum rate
set forth or calculated in the manner described in the Preliminary Statement under "REMIC I" or "REMIC II," respectively.
Uncertificated Principal Balance: The principal amount of any REMIC I or REMIC II Regular Interest outstanding as
of any date of determination. As of the Closing Date, the Uncertificated Principal Balance of each REMIC I and REMIC II Regular
Interest shall equal the amount set forth in the Preliminary Statement hereto as its Initial Uncertificated Principal Balance under
"REMIC I" and "REMIC II," respectively. On each Distribution Date, the Uncertificated Principal Balance of each REMIC I Regular
Interest and REMIC II Regular Interest shall be reduced, in the case of REMIC I Regular Interests, by the sum of (i) the principal
portion of Realized Losses allocated to the REMIC I Regular Interests in accordance with the definition of REMIC I Realized Losses
and (ii) the amounts deemed distributed on each Distribution Date in respect of principal on the REMIC I Regular Interests pursuant
to Section 4.01(IV)(a)(i), and in the case of REMIC II Regular Interests, by the sum of (i) the principal portion of Realized Losses
allocated to the REMIC II Regular Interests in accordance with the definition of REMIC II Realized Losses and (ii) the amounts deemed
distributed on each Distribution Date in respect of principal on the REMIC II Regular Interests pursuant to Section 4.01(IV)(a)(ii).
Uncertificated Regular Interest: Any of the REMIC I Regular Interests and REMIC II Regular Interests.
Undercollateralized Group: As defined in Section 4.07(b).
Voting Rights: The portion of the voting rights of all the Certificates that is allocated to any Certificate for
purposes of the voting provisions of this Agreement. At all times during the term of this Agreement, 99% of all Voting Rights shall
be allocated among the Class A Certificates (other than the Residual Certificates), Class M Certificates and Class C-B Certificates.
The portion of such 99% Voting Rights allocated to each of the Class A Certificates (other than the Residual Certificates), Class M
Certificates and Class C-B Certificates shall be based on the fraction, expressed as a percentage, the numerator of which is the
Class Principal Balance of each such Class then outstanding and the denominator of which is the aggregate Class Principal Balance of
all such Classes then outstanding. At all times during the term of this Agreement, the Class 5-X Certificates shall be allocated 1%
of the Voting Rights. Voting Rights shall be allocated among the Certificates within each Class in proportion to their respective
outstanding Class Principal Balances or Class Notional Amounts, as applicable. The Residual Certificates shall have no Voting Rights.
-38-
Wachovia: Wachovia Mortgage Corporation and its successors and assigns.
Wachovia Serviced Mortgage Loans: The Mortgage Loans identified as such on the Mortgage Loan Schedule, for which
Wachovia is the applicable Designated Servicer.
Wachovia Reconstituted Servicing Agreement: That certain Reconstituted Servicing Agreement, dated as of February 1,
2007, among DLJMC, Wachovia, the Master Servicer and the Trust Administrator, and acknowledged by the Trustee.
Wachovia Underlying Servicing Agreement: The "Servicing Agreement" referred to in the Wachovia Reconstituted
Servicing Agreement.
WaMu Bank: Washington Mutual Bank and its successors and assigns.
WaMu Bank Serviced Mortgage Loans: The Mortgage Loans identified as such on the Mortgage Loan Schedule, for which
WaMu Bank is the applicable Designated Servicer.
WaMu Bank Reconstituted Servicing Agreement: That certain Reconstituted Servicing Agreement, dated as of
February 1, 2007, among DLJMC, WaMu Bank, the Master Servicer and the Trust Administrator, and acknowledged by the Trustee.
WaMu Bank Underlying Servicing Agreement: The "Servicing Agreement" referred to in the WaMu Bank Reconstituted
Servicing Agreement.
-39-
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
SECTION 2.01. Conveyance of Trust Fund.
(a) The Depositor does hereby establish the Adjustable Rate Mortgage Trust 2007-1 (the "Trust") and sells,
transfers, assigns, delivers, sets over and otherwise conveys to the Trustee in trust for the benefit of the Certificateholders,
without recourse, the Depositor's right, title and interest in and to (a) the Mortgage Loans listed in the Mortgage Loan Schedule,
including all interest and principal received or receivable by the Depositor on or with respect to the Mortgage Loans after the
Cut-off Date and any Assigned Prepayment Premiums with respect thereto, but not including payments of principal and interest due and
payable on the Mortgage Loans on or before the Cut-off Date, together with the Mortgage Files relating to the Mortgage Loans,
(b) REO Property, (c) the Collection Account, the Certificate Account, the Group 5 Interest Rate Cap Account and all amounts deposited
therein pursuant to the applicable provisions of this Agreement, (d) any insurance policies with respect to the Mortgage Loans,
(e) the Depositor's rights under the Assignment and Assumption Agreement and (f) all proceeds of the conversion, voluntary or
involuntary, of any of the foregoing into cash or other liquid property.
(b) As set forth in the Standard Terms.
(c) As set forth in the Standard Terms.
(d) As set forth in the Standard Terms.
(e) The Depositor hereby authorizes and directs the Trust Administrator to (i) execute the Group 5 Interest
Rate Cap Agreement and (ii) to ratify, on behalf of the Trust, the terms agreed to by the Depositor with respect to the Group 5
Interest Rate Cap Agreement. The Depositor shall pay or cause to be paid on behalf of the Trust the payments owed to the Group 5
Interest Rate Cap Counterparty as of the Closing Date pursuant to the terms of the Group 5 Interest Rate Cap Agreement.
(f) Not applicable.
(g) Not applicable.
(h) As set forth in the Standard Terms.
(i) As set forth in the Standard Terms.
SECTION 2.02. Acceptance by the Trustee.
(a) As set forth in the Standard Terms.
(b) Not Applicable.
(c) As set forth in the Standard Terms.
(d) As set forth in the Standard Terms.
-40-
SECTION 2.03. Representations and Warranties of the Seller, Master Servicer and Servicers.
As set forth in Section 2.03 of the Standard Terms.
SECTION 2.04. Representations and Warranties of the Depositor as to the Mortgage Loans.
As set forth in Section 2.04 of the Standard Terms.
SECTION 2.05. Delivery of Opinion of Counsel in Connection with Substitutions.
As set forth in Section 2.05 of the Standard Terms.
SECTION 2.06. Issuance of Certificates.
As set forth in Section 2.06 of the Standard Terms.
SECTION 2.07. REMIC Provisions.
(a) The Depositor hereby elects and authorizes the Trust Administrator to treat the Trust Fund as the number of
separate REMICs specified in the Preliminary Statement (each, a "REMIC") under the Code and, if necessary, under applicable state law
and apply such Preliminary Statement in determining the rights of the Interests in REMICs thereby created. Each such election will
be made on Form 1066 or other appropriate federal tax or information return (including Form 8811) or any appropriate state return
(x) for the taxable year ending on the last day of the calendar year in which the Certificates are issued and (y) for the taxable year
ending on the last day of the calendar year in which Certificates are first sold to a third party. The Closing Date is hereby
designated as the "startup day" of each REMIC created hereunder within the meaning of Section 860G(a)(9) of the Code. The "regular
interests" (within the meaning of Section 860G of the Code) in each REMIC shall consist of the regular interests with the terms set
forth for each REMIC in the Preliminary Statement and the Class AR and Class AR-L Certificates shall represent the beneficial
ownership of the "residual interest" in each REMIC created hereunder. Neither the Depositor nor the Trust Administrator nor the
Trustee shall permit the creation of any "interests" (within the meaning of Section 860G of the Code) in any REMIC other than as set
forth in the Preliminary Statement.
(b) The Trust Administrator shall act as the "tax matters person" (within the meaning of the REMIC Provisions)
for each REMIC created hereunder, in the manner provided under Treasury regulations section 1.860F 4(d) and temporary Treasury
regulations section 301.6231(a)(7)1T. In the event that for any reason, the Trust Administrator is not recognized as the tax matters
person then the Trust Administrator shall act as agent for the Class AR and the Class AR-L Certificateholder as tax matters person.
By its acceptance of a Residual Certificate, each Holder thereof shall have agreed to such appointment and shall have consented to
the appointment of the Trust Administrator as its agent to act on behalf of each REMIC created hereunder pursuant to the specific
duties outlined herein.
(c) A Holder of the Residual Certificates, by the purchase of such Certificates, shall be deemed to have agreed
to timely pay, upon demand by the Trust Administrator, the amount of any minimum California state franchise taxes due with respect to
each REMIC created hereunder under Sections 23151(a) and 23153(a) of the California Revenue and Taxation Code. Notwithstanding the
foregoing, the Trust Administrator shall be authorized to retain the amount of such tax from amounts otherwise distributable to such
Holder in the event such Holder does not promptly pay such amount upon demand by the Trust Administrator. In the event that any
other federal, state or local tax is imposed, including without limitation taxes imposed on a "prohibited transaction" of a REMIC as
defined in Section 860F of the Code, such tax shall be charged against amounts otherwise available for distribution to the applicable
Holder of a Residual Certificate and then against amounts otherwise available for distribution to the Holders of Regular Certificates
in accordance with the provisions set forth in Section 4.01. The Trust Administrator or the Trustee shall promptly deposit in the
Certificate Account any amount of "prohibited transaction" tax that results from a breach of the Trust Administrator's or the
Trustee's duties, respectively, under this Agreement. The Master Servicer or the related Servicer shall promptly deposit in the
Certificate Account any amount of "prohibited transaction" tax that results from a breach of the Master Servicer's or such Servicer's
duties, respectively, under this Agreement.
-41-
(d) The Trust Administrator shall act as attorney in fact and as the tax matters person of each REMIC created
hereunder and in such capacity the Trust Administrator shall: (i) prepare, sign and file, or cause to be prepared, signed and filed,
federal and state tax returns using a calendar year as the taxable year for each REMIC created hereunder when and as required by the
REMIC Provisions and other applicable federal income tax laws as the direct representative of each such REMIC in compliance with the
Code and shall provide copies of such returns as required by the Code; (ii) make an election, on behalf of each REMIC created
hereunder, to be treated as a REMIC on the federal tax return of such REMIC for its first taxable year, in accordance with the REMIC
Provisions; and (iii) prepare and forward, or cause to be prepared and forwarded, to the Certificateholders and to any governmental
taxing authority all information reports as and when required to be provided to them in accordance with the REMIC Provisions. The
expenses of preparing and filing such returns shall be borne by the Trust Administrator. The Depositor, the Master Servicer and the
related Servicer shall provide on a prompt and timely basis to the Trust Administrator or its designee such information with respect
to each REMIC created hereunder as is in their possession and reasonably required or requested by the Trust Administrator to enable
it to perform its obligations under this subsection.
In its capacity as attorney in fact and as the tax matters person, the Trust Administrator shall also: (A) act on
behalf of each REMIC created hereunder in relation to any tax matter or controversy involving the Trust Fund, (B) represent the Trust
Fund in any administrative or judicial proceeding relating to an examination or audit by any governmental taxing authority with
respect thereto and (C) cause to be paid solely from the sources provided herein the amount of any taxes imposed on each REMIC
created hereunder when and as the same shall be due and payable (but such obligation shall not prevent the Trust Administrator or any
other appropriate Person from contesting any such tax in appropriate proceedings and shall not prevent the Trust Administrator from
withholding payment of such tax, if permitted by law, pending the outcome of such proceedings).
(e) The Trust Administrator shall provide (i) to any transferor of a Residual Certificate such information as
is necessary for the application of any tax relating to the transfer of a Residual Certificate to any Person who is not a permitted
transferee, (ii) 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 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 created hereunder.
(f) The Trustee, to the extent directed by the Trust Administrator, the Depositor and the Holder of the
Residual Certificates shall take any action or cause the Trust Fund to take any action necessary to create or maintain the status of
each REMIC created hereunder as a REMIC under the REMIC Provisions and shall assist each other as necessary to create or maintain
such status. Neither the Trustee, to the extent directed or (in the case of a failure to act) not directed by the Trust
Administrator, nor the Holder of the Residual Certificates shall take any action, cause the Trust Fund to take any action or fail to
take (or fail to cause the Trust Fund to take) any action that, under the REMIC Provisions, if taken or not taken, as the case may
be, could (i) endanger the status of each REMIC created hereunder as a REMIC or (ii) result in the imposition of a tax upon a REMIC
(including, but not limited to, the tax on prohibited transactions as defined in Code Section 860F(a)(2) and the tax on prohibited
contributions set forth in Section 860G(d) of the Code) (either such event, an "Adverse REMIC Event") unless the Trustee and the
Trust Administrator have received an Opinion of Counsel (at the expense of the party seeking to take such action) to the effect that
the contemplated action will not endanger such status or result in the imposition of such a tax.
-42-
The Trustee and the Trust Administrator shall not take or fail to take any action (whether or not authorized
hereunder) as to which the Master Servicer, a Servicer or the Depositor 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 a REMIC or their assets, or causing any REMIC created hereunder to take any action, which is not expressly permitted
under the terms of this Agreement, the Trustee and the Trust Administrator will consult with the Master Servicer, the Servicers and
the Depositor or their designees, in writing, with respect to whether such action could cause an Adverse REMIC Event to occur with
respect to any REMIC created hereunder and the Trustee and the Trust Administrator shall not take any such action or cause that REMIC
to take any such action as to which the Master Servicer, any Servicer or the Depositor has advised it in writing that an Adverse
REMIC Event could occur.
In addition, prior to taking any action with respect to any REMIC created hereunder or the assets therein, or
causing any REMIC created hereunder to take any action, which is not expressly permitted under the terms of this Agreement, the
Holder of the Residual Certificates will consult with the Trust Administrator or its designee, in writing, with respect to whether
such action could cause an Adverse REMIC Event to occur with respect to any REMIC created hereunder, and no such Person shall take
any action or cause the Trust Fund to take any such action as to which the Trust Administrator has advised it in writing that an
Adverse REMIC Event could occur. The Trustee and the Trust Administrator may consult with counsel to make such written advice, and
the cost of same shall be borne by the party seeking to take action not permitted by this Agreement.
At all times as may be required by the Code, the Trust Administrator 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 such REMIC, as defined in Section 860G(c) of
the Code, on any contributions to a 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 related Servicer,
if such Servicer has in its sole discretion determined to indemnify the Trust Fund against such tax or if such tax arises out of or
results from a breach of such Servicer's duties under (x) Section 2.07(j) of this Agreement to not enter into any arrangement by
which a REMIC would receive a fee or other compensation for services or to permit such REMIC to receive any income from assets other
than "qualified mortgages" or "permitted investments," (y) Section 3.01 of this Agreement to not make or permit any modification,
waiver or amendment of any Mortgage Loan which would cause any REMIC created hereunder to fail to qualify as a REMIC or result in the
imposition of any tax under Section 860F(a) or Section 860G(d) of the Code or (z) Section 3.11(c) of this Agreement to not cause any
REO Property to fail to qualify as "foreclosure property" within the meaning of Section 860G(a)(8) of the Code or to subject any
REMIC created hereunder to the imposition of any federal, state or local income taxes on the income earned from such Mortgaged
Property under Section 860G(c) of the Code of otherwise, (ii) 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 if the Master Servicer has in its sole discretion
determined to indemnify the Trust Fund against such tax, (iii) to the Trust Administrator, if such tax arises out of or results from
a breach by the Trust Administrator of any of its obligations under this Article II, (iv) 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 II or (v) otherwise against amounts on deposit
in the Collection Account as provided by Section 3.08 and on the Distribution Date(s) following such reimbursement the aggregate of
such taxes shall be allocated in reduction of the Interest Distribution Amount on each Class entitled thereto in the same manner as
if such taxes constituted a Prepayment Interest Shortfall.
-43-
In accordance with Section 2.07(c), the related Servicer, the Master Servicer, the Trustee or the Trust
Administrator, as applicable, shall promptly deposit in the Certificate Account or Collection Account, as applicable, any amount of
such tax.
For purposes of this Section 2.07(g), a tax is imposed following the final and unappealable determination under the
Code of the amount of such tax and written notice thereof by the Tax Matters Person to the party to be charged.
The failure of the Master Servicer or the related Servicer to promptly deposit in the Certificate Account or
Collection Account, as applicable, any amount of such tax shall be an Event of Default, as provided in Section 8.01(b). However, in
the case of WMMSC, the prompt deposit of any such amount in the Certificate Account shall cure any Special Event of Default unless
notice of such Special Event of Default is accompanied by an Opinion of Counsel, at the expense of WMMSC, to the effect that the
cumulative effect of WMMSC's breach or breaches, notwithstanding the deposit of the amounts of any such tax, shall have given rise to
a substantial risk that any REMIC created hereunder would fail to continue to qualify as a REMIC.
(h) The Trust Administrator 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, none of any Servicer, the Trustee (which will act only at the direction of the
Trust Administrator or as otherwise specifically provided in this Agreement) or the Trust Administrator shall accept any
contributions of assets to any REMIC created hereunder unless (subject to Section 2.05) such Servicer, the Trustee or the Trust
Administrator 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 a REMIC will not cause that REMIC to fail to qualify as a REMIC at any time that any
Certificates are outstanding, or subject that REMIC to any tax under the REMIC Provisions or other applicable provisions of federal,
state and local law or ordinances.
(j) None of any Servicer, the Trustee (which will act only at the direction of the Trust Administrator or as
otherwise specifically provided in this Agreement) or the Trust Administrator shall (subject to Section 2.05) enter into any
arrangement by which a REMIC will receive a fee or other compensation for services nor permit 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) Within 30 days after the Closing Date, the Trust Administrator shall apply to the Internal Revenue Service
for an employer identification number for each REMIC created hereunder by means of a Form SS-4 or other acceptable means and 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.
-44-
(l) None of the Trustee (which will act only at the direction of the Trust Administrator or as otherwise
specifically provided in this Agreement), the Trust Administrator, the Master Servicer or any 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 REMIC created hereunder pursuant to Article X of this
Agreement or (iv) a purchase of Mortgage Loans pursuant to Article II or III of this Agreement) nor acquire any assets for a REMIC,
nor sell or dispose of any investments in the Collection Account or the Certificate Account for gain nor accept any contributions to
a REMIC after the Closing Date (a) unless it has received an Opinion of Counsel that such sale, disposition, substitution or
acquisition will not affect adversely the status of any REMIC created hereunder as a REMIC or (b) unless the Master Servicer or such
Servicer has determined in its sole discretion to indemnify the Trust Fund against such tax.
(m) In order to enable the Trust Administrator to perform its duties as set forth herein, the Depositor shall
provide, or cause to be provided to the Trust Administrator, within ten days after the Closing Date, all information or data that the
Trust Administrator determines to be relevant for tax purposes to the valuations and offering prices of the Certificates, including,
without limitation, the price, yield, prepayment assumption and projected cash flows of the Certificates and the Mortgage Loans and
the Trust Administrator shall be entitled to rely upon any and all such information and data in the performance of its duties set
forth herein. Thereafter, the Master Servicer, or with respect to the WMMSC Serviced Mortgage Loans, WMMSC, shall provide, promptly
upon request therefor, any such additional information or data (or with respect to WMMSC, any such additional loan level information
and data regarding the WMMSC Serviced Mortgage Loans) that the Trustee or the Trust Administrator may from time to time reasonably
request in order to enable the Trustee and the Trust Administrator to perform their duties as set forth herein and the Trustee and
the Trust Administrator shall be entitled to rely upon any and all such information and data in the performance of its duties set
forth herein. DLJMC shall indemnify the Trust Administrator and hold it harmless for any loss, liability, damage, claim or expense
of the Trust Administrator arising from any failure of the Depositor to provide, or to cause to be provided, accurate information or
data to the Trust Administrator on a timely basis. The Master Servicer shall indemnify the Trustee and the Trust Administrator and
hold it harmless for any loss, liability, damage, claim or expense of the Trustee and the Trust Administrator arising from any
failure of the Master Servicer to provide, or to cause to be provided, accurate information or data required to be provided by the
Master Servicer to the Trustee and the Trust Administrator on a timely basis; provided, however, that if any Servicer (other than
WMMSC) shall fail to provide such information to the Master Servicer upon timely request for such information by the Master Servicer,
that Servicer shall indemnify the Master Servicer, the Trustee and the Trust Administrator and hold it harmless for any loss,
liability, damage, claim or expense of the Master Servicer, the Trustee and the Trust Administrator arising from any failure of that
Servicer to provide, or to cause to be provided, the information referred to above on a timely basis. WMMSC shall indemnify the
Trustee and the Trust Administrator and hold each of them harmless for any loss, liability, damage, claim or expense, other than any
special, indirect, punitive or consequential loss, liability, damage, claim or expense, of the Trustee and the Trust Administrator
arising from any failure of WMMSC to provide, or to cause to be provided, the loan level information or data regarding the WMMSC
Mortgage Loans reasonably requested by the Trustee or Trust Administrator, and required to be provided by WMMSC pursuant to this
Section 2.07(m), on a timely basis. The indemnification provisions hereunder shall survive the termination of this Agreement and
shall extend to any co-trustee and co-trust administrator appointed pursuant to this Agreement.
-45-
(n) The Trust Administrator shall account for the rights of the Holders of the Group 5 Senior Certificates and
Class M Certificates to receive payments in respect of Basis Risk Shortfalls as rights in an interest rate cap contract written by
the Class 5-X Certificateholders in favor of the Holders of the Group 5 Senior Certificates and Class M Certificates and not as an
obligation of REMIC III, whose obligation to pay such Certificates will be subject to a cap equal to the applicable Net Funds Cap and
shall account for such rights as property held separate and apart from the regular interests as required by Treasury regulation
section 1.860G-2(i). Any amounts paid in respect of Basis Risk Shortfalls by REMIC III shall be treated as a distribution to the
Class 5-X Certificates. In addition, the Class 5-X Certificateholders shall be deemed to have entered into a contractual arrangement
with the Class AR and Class AR-L Certificateholders whereby the Class AR and Class AR-L Certificateholders agree to pay to the
Class 5-X Certificateholders on each Distribution Date amounts that would, in the absence of such contractual agreement, be
distributable with respect to the residual interest in REMIC III pursuant to Section 4.01(II)(d)(xiii) (which amounts are expected to
be zero). Thus each Group 5 Senior Certificate and Class M Certificate shall be treated as representing ownership of not only
REMIC III regular interests, but also ownership of an interest in an interest rate cap contract. Each Class 5-X Certificate shall
represent an obligation under an interest rate cap contract. For purposes of determining the issue price of REMIC III regular
interests, the Trust Administrator shall assume that the interest rate cap contract has a value of $5,000.
For any Distribution Date on which there is a payment under the Group 5 Interest Rate Cap Agreement based on a
notional balance in excess of the Class Principal Balance of the Group 5 Certificates, the amount representing such excess payment
shall not be an asset of the Trust and, instead, shall be paid into and distributed out of a separate trust created by this Agreement
for the benefit of the Group 5 Certificates and shall be distributed to the Group 5 Certificates pursuant to Section 4.01(II). The
Trust Administrator shall not be responsible for any tax reporting with respect to such separate trust.
SECTION 2.08. Covenants of the Master Servicer and each Servicer.
As set forth in Section 2.08 of the Standard Terms.
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
As set forth in ARTICLE III of the Standard Terms.
ARTICLE IV
PAYMENTS AND STATEMENTS TO CERTIFICATEHOLDERS
-46-
SECTION 4.01. Priorities of Distribution.
(I) (A) On each Distribution Date, with respect to the Group 1, Group 2, Group 3, Group 4 and Class C-B
Certificates, the Trust Administrator shall determine the amounts to be distributed to each Class of Certificates as follows:
(a) with respect to the Group 1 Certificates, from the Available Distribution Amount relating to Loan
Group 1:
(i) first, concurrently, to the Group 1 Certificates, an amount allocable to interest equal
to the related Interest Distribution Amount for such Distribution Date, any shortfall being allocated pro rata
between such Classes based on the Interest Distribution Amount that would have been distributed in the absence of
such shortfall; and
(ii) second, on each Distribution Date, from the Available Distribution Amount for Loan
Group 1 remaining after giving effect to the distributions pursuant to Section 4.01(I)(A)(a)(i) above, the Group 1
Senior Principal Distribution Amount, as principal, sequentially, as follows:
(A) first, to the Class AR Certificates and Class AR-L Certificates, pro rata based
on their respective Class Principal Balances immediately prior to such Distribution Date, until their
respective Class Principal Balances have been reduced to zero; and
(B) second, the Group 1 Senior Principal Distribution Amount for that Distribution
Date remaining after making the payments specified in clause (A) above, to the Class 1-A-1 and Class 1-A-2
Certificates, pro rata based on their respective Class Principal Balances immediately prior to such
Distribution Date, until their respective Class Principal Balances have been reduced to zero;
(b) with respect to the Group 2 Certificates, and from the Available Distribution Amount relating to
Loan Group 2:
(i) first, to the Group 2 Certificates, an amount allocable to interest equal to the related
Interest Distribution Amount for such Distribution Date; and
(ii) second, on each Distribution Date, from the Available Distribution Amount for Loan
Group 2 remaining after giving effect to the distributions pursuant to Section 4.01(I)(A)(b)(i) above, the Group 2
Senior Principal Distribution Amount, as principal, to the Class 2-A-1 Certificates, until its Class Principal
Balance has been reduced to zero.
(c) with respect to the Group 3 Certificates, and from the Available Distribution Amount relating to
Loan Group 3:
(i) first, concurrently, to the Group 3 Certificates, an amount allocable to interest equal
to the related Interest Distribution Amount for such Distribution Date, any shortfall being allocated pro rata
between such Classes based on the Interest Distribution Amount that would have been distributed in the absence of
such shortfall; and
-47-
(ii) second, on each Distribution Date, from the Available Distribution Amount for Loan
Group 3 remaining after giving effect to the distributions pursuant to Section 4.01(I)(A)(c)(i) above, to the
Class 3-A-1 Certificates, Class 3-A-2-1 Certificates, Class 3-A-2-2 Certificates and Class 3-A-3 Certificates, as
principal, the Group 3 Senior Principal Distribution Amount, pro rata based on their respective Class Principal
Balances immediately prior to such Distribution Date, until their respective Class Principal Balances have been
reduced to zero; provided, however, that the aggregate amount that would otherwise be allocable to the Class 3-A-2-1
Certificates and Class 3-A-2-2 Certificates on any Distribution Date will instead be allocated in the following
order of priority:
(A) first, the lesser of (1) $600,000 and (2) 99.80% of the pro rata portion of the
Group 3 Senior Principal Distribution Amount allocable to the Class 3-A-2-1 Certificates and Class 3-A-2-2
Certificates for such Distribution Date, to the Class 3-A-2-1 Certificates, until its Class Principal
Balance has been reduced to zero; and
(B) second, the portion of the Group 3 Senior Principal Distribution Amount
allocable to the Class 3-A-2-1 Certificates and Class 3-A-2-2 Certificates for such Distribution Date
remaining after giving effect to the distribution pursuant to Section 4.01(I)(A)(c)(ii)(A) above, to the
Class 3-A-2-2 Certificates, until its Class Principal Balance has been reduced to zero.
(d) with respect to the Group 4 Certificates, and from the Available Distribution Amount relating to
Loan Group 4:
(i) first, concurrently, to the Group 4 Certificates, an amount allocable to interest equal
to the related Interest Distribution Amount for such Distribution Date, any shortfall being allocated pro rata
between such Classes based on the Interest Distribution Amount that would have been distributed in the absence of
such shortfall; and
(ii) second, on each Distribution Date, from the Available Distribution Amount for Loan
Group 4 remaining after giving effect to the distributions pursuant to Section 4.01(I)(A)(d)(i) above, to the
Class 4-A-1 and Class 4-A-2 Certificates, as principal, the Group 4 Senior Principal Distribution Amount, pro rata
based on their respective Class Principal Balances immediately prior to such Distribution Date, until their
respective Class Principal Balances have been reduced to zero.
-48-
(e) with respect to the Class C-B and Class AR-L Certificates, from the Available Distribution Amount
relating to Loan Group 1, Loan Group 2, Loan Group 3 and Loan Group 4 remaining after the distributions pursuant to
Sections 4.01(I)(A)(a) through (d) above, subject to Sections 4.01(I)(C) below, and further subject to any payments to the
Group 1, Group 2, Group 3 and Group 4 Certificates as described in Section 4.07, to the following Classes in the following
order of priority:
(i) to the Class C-B-1 Certificates, an amount allocable to interest equal to the Interest
Distribution Amount for such Class for such Distribution Date;
(ii) to the Class C-B-1 Certificates, an amount allocable to principal equal to its Pro Rata
Share for such Distribution Date, until the Class Principal Balance of Class C-B-1 Certificates has been reduced to
zero;
(iii) to the Class C-B-2 Certificates, an amount allocable to interest equal to the Interest
Distribution Amount for such Class for such Distribution Date;
(iv) to the Class C-B-2 Certificates, an amount allocable to principal equal to its Pro Rata
Share for such Distribution Date, until the Class Principal Balance of Class C-B-2 Certificates has been reduced to
zero;
(v) to the Class C-B-3 Certificates, an amount allocable to interest equal to the Interest
Distribution Amount for such Class for such Distribution Date;
(vi) to the Class C-B-3 Certificates, an amount allocable to principal equal to its Pro Rata
Share for such Distribution Date, until the Class Principal Balance of Class C-B-3 Certificates has been reduced to
zero;
(vii) to the Class C-B-4 Certificates, an amount allocable to interest equal to the Interest
Distribution Amount for such Class for such Distribution Date;
(viii) to the Class C-B-4 Certificates, an amount allocable to principal equal to its Pro Rata
Share for such Distribution Date, until the Class Principal Balance of Class C-B-4 Certificates has been reduced to
zero;
(ix) to the Class C-B-5 Certificates, an amount allocable to interest equal to the Interest
Distribution Amount for such Class for such Distribution Date;
(x) to the Class C-B-5 Certificates, an amount allocable to principal equal to its Pro Rata
Share for such Distribution Date, until the Class Principal Balance of Class C-B-5 Certificates has been reduced to
zero;
(xi) to the Class C-B-6 Certificates, an amount allocable to interest equal to the Interest
Distribution Amount for such Class for such Distribution Date;
(xii) to the Class C-B-6 Certificates, an amount allocable to principal equal to its Pro Rata
Share for such Distribution Date, until the Class Principal Balance of Class C-B-6 Certificates has been reduced to
zero;
-49-
(xiii) to the Class C-B-1, Class C-B-2, Class C-B-3, Class C-B-4, Class C-B-5 and Class C-B-6
Certificates, in that order, up to an amount of Net Realized Losses for such Class, if any; provided, however, that
any distribution pursuant to this Section 4.01(I)(A)(e)(xiii) shall not result in a further reduction of the Class
Principal Balance of any of the Class C-B Certificates; and
(xiv) to the Class AR-L Certificates, any remaining Available Distribution Amount for Loan
Group 1, Loan Group 2, Loan Group 3 and Loan Group 4, (to the extent such amount is held by REMIC I), or to the
Class AR Certificates, any remaining Available Distribution Amount for Loan Group 1, Loan Group 2, Loan Group 3 and
Loan Group 4 (to the extent such amount is held by REMIC III).
(B) On each Distribution Date, the amount referred to in clause (i) of the definition of Interest Distribution
Amount for such Distribution Date for each Class of Group 1, Group 2, Group 3, Group 4 and Class C-B Certificates shall be reduced by
the Trust Administrator by the related Class's pro rata share (based on the amount of the Interest Distribution Amount for each such
Class before reduction pursuant to this Section 4.01(I)(B)) of (i) Net Prepayment Interest Shortfalls for Mortgage Loans in the
related Loan Group for such Distribution Date and (ii) (A) after the Special Hazard Coverage Termination Date, with respect to each
Group 1, Group 2, Group 3 and Group 4 Mortgage Loan, as applicable, that was the subject of Special Hazard Loss during the prior
calendar month, the excess of one month's interest at the related Net Mortgage Rate on the Stated Principal Balance of such Mortgage
Loan as of the Due Date in such month over the amount of Liquidation Proceeds applied as interest on such Mortgage Loan with respect
to such month, (B) after the Bankruptcy Coverage Termination Date, with respect to each Group 1, Group 2, Group 3 or Group 4 Mortgage
Loan, as applicable, that became subject to a Bankruptcy Loss during the prior calendar month, the interest portion of the related
Debt Service Reduction or Deficient Valuation, (C) each Relief Act Reduction for any Group 1, Group 2, Group 3 or Group 4 Mortgage
Loan, as applicable, incurred during the prior calendar month and (D) after the Fraud Loss Coverage Termination Date, with respect to
each Group 1, Group 2, Group 3 or Group 4 Mortgage Loan, as applicable, that became a Fraud Loan during the prior calendar month the
excess of one month's interest at the related Net Mortgage Rate on the Stated Principal Balance of such Mortgage Loan as of the Due
Date in such month over the amount of Liquidation Proceeds applied as interest on such Mortgage Loan with respect to such month. For
purposes of calculating the reduction of the Interest Distribution Amount for each Class of Class C-B Certificates with respect to
Loan Group 1, Loan Group 2, Loan Group 3 or Loan Group 4 such reduction shall be based on the amount of interest accruing at the Net
WAC Rate for such Loan Group on such Class's proportionate share, based on the Class Principal Balance of the related Subordinate
Component Balance for that Distribution Date.
(C) With respect to each Class of Class C-B Certificates, if on any Distribution Date the related Subordination
Level of such Class is less than such percentage as of the Closing Date, no distribution of Principal Prepayments will be made to any
Class or Classes of Class C-B Certificates junior to such Class (the "Restricted Classes") and the amount otherwise distributable to
the Restricted Classes in respect of such Principal Prepayments will be allocated among the remaining Classes of Class C-B
Certificates, pro rata, based upon their respective Class Principal Balances.
(D) The Trust Administrator shall distribute the Mortgage Loan Purchase Price of any Optional Termination of
Loan Group 1, Loan Group 2, Loan Group 3 and Loan Group 4 in excess of the Par Value to the holder of the Class AR-L Certificate.
-50-
(II) With respect to the Group 5 Certificates:
(a) On each Distribution Date, the Trust Administrator shall distribute the Interest Remittance Amount
for such date in the following order of priority:
(i) to the Group 5 Senior Certificates, pro rata based on amounts due, Current Interest and
any Carryforward Interest for such Class and such Distribution Date;
(ii) to the Class 5-M-1 Certificates, Current Interest and any Carryforward Interest for such
Class and such Distribution Date;
(iii) to the Class 5-M-2 Certificates, Current Interest and any Carryforward Interest for such
Class and such Distribution Date;
(iv) to the Class 5-M-3 Certificates, Current Interest and any Carryforward Interest for such
Class and such Distribution Date;
(v) to the Class 5-M-4 Certificates, Current Interest and any Carryforward Interest for such
Class and such Distribution Date;
(vi) to the Class 5-M-5 Certificates, Current Interest and any Carryforward Interest for such
Class and such Distribution Date;
(vii) to the Class 5-M-6 Certificates, Current Interest and any Carryforward Interest for such
Class and such Distribution Date;
(viii) to the Class 5-M-7 Certificates, Current Interest and any Carryforward Interest for such
Class and such Distribution Date;
(ix) to the Class 5-M-8 Certificates, Current Interest and any Carryforward Interest for such
Class and such Distribution Date;
(x) to the Class 5-M-9 Certificates, Current Interest and any Carryforward Interest for such
Class and such Distribution Date;
(xi) to the Class 5-M-10 Certificates, Current Interest and any Carryforward Interest for such
Class and such Distribution Date; and
(xii) for application as part of Monthly Excess Cashflow for such Distribution Date as provided
in Section 4.01(II)(d), any Interest Remittance Amount remaining after application pursuant to
Section 4.01(II)(a)(i) through (xi) above.
-51-
(b) On each Distribution Date (A) prior to the Stepdown Date or (B) with respect to which a Trigger
Event is in effect, the Trust Administrator shall distribute the Principal Payment Amount for Loan Group 5 for such date in
the following order of priority:
(i) to the Group 5 Senior Certificates, pro rata based on their respective Class Principal
Balances immediately prior to such Distribution Date, until their respective Class Principal Balances have been
reduced to zero; provided, however, that the aggregate amount that would otherwise be allocable to the Class 5-A-2-1
Certificates and Class 5-A-2-2 Certificates on any Distribution Date will instead be distributed sequentially, to
the Class 5-A-2-1 Certificates and Class 5-A-2-2 Certificates, in that order, in each case until its Class Principal
Balance has been reduced to zero;
(ii) to the Class 5-M-1 Certificates, until its Class Principal Balance has been reduced to
zero;
(iii) to the Class 5-M-2 Certificates, until its Class Principal Balance has been reduced to
zero;
(iv) to the Class 5-M-3 Certificates, until its Class Principal Balance has been reduced to
zero;
(v) to the Class 5-M-4 Certificates, until its Class Principal Balance has been reduced to
zero;
(vi) to the Class 5-M-5 Certificates, until its Class Principal Balance has been reduced to
zero;
(vii) to the Class 5-M-6 Certificates, until its Class Principal Balance has been reduced to
zero;
(viii) to the Class 5-M-7 Certificates, until its Class Principal Balance has been reduced to
zero;
(ix) to the Class 5-M-8 Certificates, until its Class Principal Balance has been reduced to
zero;
(x) to the Class 5-M-9 Certificates, until its Class Principal Balance has been reduced to
zero;
(xi) to the Class 5-M-10 Certificates, until its Class Principal Balance has been reduced to
zero; and
(xii) for application as part of Monthly Excess Cashflow for such Distribution Date, as
provided in Section 4.01(II)(d), any Principal Payment Amount remaining after application pursuant to
Section 4.01(II)(b)(i) through (xi) above.
-52-
(c) On each Distribution Date (A) on or after the Stepdown Date and (B) with respect to which a
Trigger Event is not in effect, the Trust Administrator shall distribute the Principal Payment Amount for Loan Group 5 for
such date in the following order of priority:
(i) to the Group 5 Senior Certificates, pro rata based on their respective Class Principal
Balances immediately prior to such Distribution Date, the sum of (1) the Group 5 Senior Principal Payment Amount and
(2) the component of the Principal Remittance Amount representing payments, if any, under the Group 5 Interest Rate
Cap Agreement to cover Realized Losses on the Group 5 Mortgage Loans, until their respective Class Principal
Balances have been reduced to zero; provided, however, that the aggregate amount that would otherwise be allocable
to the Class 5-A-2-1 Certificates and Class 5-A-2-2 Certificates on any Distribution Date will instead be
distributed sequentially, to the Class 5-A-2-1 Certificates and Class 5-A-2-2 Certificates, in that order, in each
case until its Class Principal Balance has been reduced to zero;
(ii) to the Class 5-M-1 Certificates, the Class 5-M-1 Principal Payment Amount for such
Distribution Date, until its Class Principal Balance has been reduced to zero;
(iii) to the Class 5-M-2 Certificates, the Class 5-M-2 Principal Payment Amount for such
Distribution Date, until the Class Principal Balance of such Class has been reduced to zero;
(iv) to the Class 5-M-3 Certificates, the Class 5-M-3 Principal Payment Amount for such
Distribution Date, until the Class Principal Balance of such Class has been reduced to zero;
(v) to the Class 5-M-4 Certificates, the Class 5-M-4 Principal Payment Amount for such
Distribution Date, until the Class Principal Balance of such Class has been reduced to zero;
(vi) to the Class 5-M-5 Certificates, the Class 5-M-5 Principal Payment Amount for such
Distribution Date, until the Class Principal Balance of such Class has been reduced to zero;
(vii) to the Class 5-M-6 Certificates, the Class 5-M-6 Principal Payment Amount for such
Distribution Date, until the Class Principal Balance of such Class has been reduced to zero;
(viii) to the Class 5-M-7 Certificates, the Class 5-M-7 Principal Payment Amount for such
Distribution Date, until the Class Principal Balance of such Class has been reduced to zero;
(ix) to the Class 5-M-8 Certificates, the Class 5-M-8 Principal Payment Amount for such
Distribution Date, until the Class Principal Balance of such Class has been reduced to zero;
(x) to the Class 5-M-9 Certificates, the Class 5-M-9 Principal Payment Amount for such
Distribution Date, until the Class Principal Balance of such Class has been reduced to zero;
-53-
(xi) to the Class 5-M-10 Certificates, the Class 5-M-10 Principal Payment Amount for such
Distribution Date, until the Class Principal Balance of such Class has been reduced to zero; and
(xii) for application as part of Monthly Excess Cashflow for such Distribution Date, as
provided in Section 4.01(II)(d), any Principal Payment Amount remaining after application pursuant to
Section 4.01(II)(c)(i) through (xi) above.
(d) On each Distribution Date, the Trust Administrator shall distribute the Monthly Excess Cashflow
for such date in the following order of priority:
(i) (A) until the aggregate Class Principal Balance of the LIBOR Certificates equals the
Aggregate Loan Group Balance for Loan Group 5 for such Distribution Date minus the Targeted
Overcollateralization Amount for such Distribution Date, on each Distribution Date (x) prior to the Stepdown
Date or (y) with respect to which a Trigger Event is in effect, to the extent of Monthly Excess Interest for
such Distribution Date, to the Group 5 Certificates, in the following order of priority:
(1) to the Group 5 Senior Certificates, pro rata based on their respective Class
Principal Balances immediately prior to such Distribution Date, until their respective Class Principal
Balances have been reduced to zero; provided, however, that the aggregate amount that would otherwise
be allocable to the Class 5-A-2-1 Certificates and Class 5-A-2-2 Certificates on any Distribution Date
will instead be distributed sequentially, to the Class 5-A-2-1 Certificates and Class 5-A-2-2
Certificates, in that order, in each case until its Class Principal Balance has been reduced to zero;
(2) to the Class 5-M-1 Certificates, until its Class Principal Balance has been
reduced to zero;
(3) to the Class 5-M-2 Certificates, until its Class Principal Balance has been
reduced to zero;
(4) to the Class 5-M-3 Certificates, until its Class Principal Balance has been
reduced to zero;
(5) to the Class 5-M-4 Certificates, until its Class Principal Balance has been
reduced to zero;
(6) to the Class 5-M-5 Certificates, until its Class Principal Balance has been
reduced to zero;
(7) to the Class 5-M-6 Certificates, until its Class Principal Balance has been
reduced to zero;
(8) to the Class 5-M-7 Certificates, until its Class Principal Balance has been
reduced to zero;
-54-
(9) to the Class 5-M-8 Certificates, until its Class Principal Balance has been
reduced to zero;
(10) to the Class 5-M-9 Certificates, until its Class Principal Balance has been
reduced to zero; and
(11) to the Class 5-M-10 Certificates, until its Class Principal Balance has been
reduced to zero;
(B) on each Distribution Date (x) on or after the Stepdown Date and (y) with respect
to which a Trigger Event is not in effect, to fund any principal distributions required to be made on such
Distribution Date set forth above in Section 4.01(II)(c) above, after giving effect to the distribution of
the Principal Payment Amount for Loan Group 5 for such Distribution Date, in accordance with the priorities
set forth therein;
(ii) to the Class 5-A-1 Certificates, Class 5-A-2-1 Certificates, Class 5-A-2-2 Certificates,
Class 5-A-3-1 Certificates and Class 5-A-3-2 Certificates, any Deferred Amount for such Class, pro rata based on
amounts due; provided, however, that the aggregate amount that would otherwise be allocable to the Class 5-A-3-1
Certificates and Class 5-A-3-2 Certificates on any Distribution Date will instead be distributed sequentially, to
the Class 5-A-3-1 Certificates and Class 5-A-3-2 Certificates, in that order, in each case until their respective
Deferred Amount has been paid in full;
(iii) to the Class 5-A-4 Certificates, any Deferred Amount for such Class;
(iv) to the Class 5-M-1 Certificates, any Deferred Amount for such Class;
(v) to the Class 5-M-2 Certificates, any Deferred Amount for such Class;
(vi) to the Class 5-M-3 Certificates, any Deferred Amount for such Class;
(vii) to the Class 5-M-4 Certificates, any Deferred Amount for such Class;
(viii) to the Class 5-M-5 Certificates, any Deferred Amount for such Class;
(ix) to the Class 5-M-6 Certificates, any Deferred Amount for such Class;
(x) to the Class 5-M-7 Certificates, any Deferred Amount for such Class;
(xi) to the Class 5-M-8 Certificates, any Deferred Amount for such Class;
-55-
(xii) to the Class 5-M-9 Certificates, any Deferred Amount for such Class;
(xiii) to the Class 5-M-10 Certificates, any Deferred Amount for such Class;
(xiv) to the Group 5 Senior Certificates, pro rata based on amounts due, any Basis Risk
Shortfall due and owing for each such Class;
(xv) to the Class 5-M-1 Certificates, any Basis Risk Shortfall due and owing for such Class;
(xvi) to the Class 5-M-2 Certificates, any Basis Risk Shortfall due and owing for such Class;
(xvii) to the Class 5-M-3 Certificates, any Basis Risk Shortfall due and owing for such Class;
(xviii) to the Class 5-M-4 Certificates, any Basis Risk Shortfall due and owing for such Class;
(xix) to the Class 5-M-5 Certificates, any Basis Risk Shortfall due and owing for such Class;
(xx) to the Class 5-M-6 Certificates, any Basis Risk Shortfall due and owing for such Class;
(xxi) to the Class 5-M-7 Certificates, any Basis Risk Shortfall due and owing for such Class;
(xxii) to the Class 5-M-8 Certificates, any Basis Risk Shortfall due and owing for such Class;
(xxiii) to the Class 5-M-9 Certificates, any Basis Risk Shortfall due and owing for such Class;
(xxiv) to the Class 5-M-10 Certificates, any Basis Risk Shortfall due and owing for such Class;
(xxv) to the Class 5-X Certificates, the Class 5-X Distributable Amount for such Distribution
Date; and
(xxvi) to the Class AR Certificates, any remaining amount; provided, however, that any amount
that would be distributable pursuant to this priority (xxvi) shall not be paid with respect to the Class AR
Certificates but shall be paid instead with respect to the Class 5-X Certificates pursuant to a contract that exists
under this Agreement between the Class AR Certificateholders and the Class 5-X Certificateholders.
-56-
(e) The Trust Administrator shall distribute the Mortgage Loan Purchase Price of any Optional
Termination of Loan Group 5 in excess of the Par Value to the holder of the Class AR-L Certificate.
(III) (a) Prior to the distributions described in Sections 4.01(I) and (II), the following distributions
shall be deemed to have been made:
(i) from REMIC I to REMIC III, as the holder of the REMIC I Regular Interests, and to Holders
of the Class AR-L Certificates in respect of Component I thereof, from the REMIC I Available Distribution Amount,
the REMIC I Distribution Amount in the amounts, from the sources and with the character set forth in the definition
thereof in respect of the REMIC I Regular Interests and Component I of the Class AR-L Certificates as set forth
therein; and
(ii) from REMIC II to REMIC III, as the holder of the REMIC II Regular Interests, and to
Holders of the Class AR-L Certificates in respect of Component II thereof, from the REMIC II Available Distribution
Amount, the REMIC II Distribution Amount in the amounts, from the sources and with the character set forth in the
definition thereof in respect of the REMIC II Regular Interests and Component II of the Class AR-L Certificates as
set forth therein.
(b) Notwithstanding the distributions on the REMIC Regular Interests described in this
Section 4.01(III), distribution of funds from the Certificate Account shall be made only in accordance with Sections 4.01(I)
and (II).
(IV) On each Distribution Date, the Trust Administrator shall distribute to the Holder of the Class P
Certificates, the aggregate of all Assigned Prepayment Premiums for Mortgage Loans collected or paid by each applicable Servicer with
respect to the related Prepayment Period.
SECTION 4.02. Allocation of Losses.
(a) Realized Losses on the Mortgage Loans in each of Loan Group 1, Loan Group 2, Loan Group 3 and Loan Group 4
incurred during a calendar month shall be allocated by the Trust Administrator to the Classes of Certificates on the Distribution
Date in the next calendar month as follows:
(i) any Realized Loss, other than an Excess Loss, shall be allocated first, to the Class C-B
Certificates, in decreasing order of their alphanumerical Class designations (beginning with the Class C-B-6 Certificates),
until the respective Class Principal Balance of each such Class has been reduced to zero, and second, to the Senior
Certificates of the related Certificate Group, pro rata, on the basis of their respective Class Principal Balances, until
the respective Class Principal Balance of each such Class has been reduced to zero; provided, however, with respect to the
Group 1 Certificates, Realized Losses on the Group 1 Loans that would otherwise be allocated to the Class 1-A-1 Certificates
and Class 1-A-2 Certificates in the aggregate will instead be allocated first, to the Class 1-A-2 Certificates, until its
Class Principal Balance has been reduced to zero, and second, to the Class 1-A-1 Certificates, until its Class Principal
Balance has been reduced to zero; with respect to the Group 3 Certificates, Realized Losses on the Group 3 Loans that would
otherwise be allocated to the Class 3-A-1 Certificates, Class 3-A-2-1 Certificates, Class 3-A-2-2 Certificates and Class
3-A-3 Certificates in the aggregate will instead be allocated first, to the Class 3-A-3 Certificates, until its Class
Principal Balance has been reduced to zero, and second, to the Class 3-A-1 Certificates, Class 3-A-2-1 Certificates and
Class 3-A-2-2 Certificates, pro rata, on the basis of their respective Class Principal Balances, until the respective Class
Principal Balance of each such Class has been reduced to zero; and with respect to the Group 4 Certificates, Realized Losses
on the Group 4 Loans that would otherwise be allocated to the Class 4-A-1 Certificates and Class 4-A-2 Certificates in the
aggregate will instead be allocated first, to the Class 4-A-2 Certificates, until its Class Principal Balance has been
reduced to zero and second, to the Class 4-A-1 Certificates, until its Class Principal Balance has been reduced to zero; and
-57-
(ii) Excess Losses in respect of principal for Mortgage Loans in Loan Group 1, Loan Group 2, Loan
Group 3 and Loan Group 4 will be allocated among all Group 1, Group 2, Group 3, Group 4 and Class C-B Certificates, pro rata
based on their respective Class Principal Balances.
(b) On each Distribution Date, if the aggregate Class Principal Balance of all Group 1, Group 2, Group 3,
Group 4 and Class C-B Certificates exceeds the Aggregate Groups 1-4 Collateral Balance (after giving effect to distributions of
principal and the allocation of all losses to such Certificates on such Distribution Date), such excess will be deemed a principal
loss and will be allocated by the Trust Administrator to the most junior Class of Class C-B Certificates then outstanding.
(c) Any Realized Loss allocated to a Class of Certificates or any reduction in the Class Principal Balance of a
Class of Certificates pursuant to Section 4.02(b) shall be allocated by the Trust Administrator among the Certificates of such
Class in proportion to their respective Certificate Balances.
(d) Any allocation by the Trust Administrator of Realized Losses to a Certificate or any reduction in the
Certificate Balance of a Certificate pursuant to Section 4.02(b) shall be accomplished by reducing the Certificate Balance thereof,
immediately following the distributions made on the related Distribution Date in accordance with the definition of "Certificate
Balance."
(e) On each Distribution Date, the Trust Administrator shall determine the total Applied Loss Amount with
respect to the Group 5 Certificates, if any, for such Distribution Date. The Applied Loss Amount with respect to the Group 5
Certificates for any Distribution Date shall be applied by reducing the Class Principal Balance of each Class of LIBOR Certificates,
beginning with the Class of Class M Certificates, then outstanding with the lowest relative payment priority, in each case until the
respective Class Principal Balance thereof has been reduced to zero, or if no Class M Certificates are then outstanding, the Class
5-A-4 Certificates, until its Class Principal Balance has been reduced to zero, or if the Class A-5-4 Certificates are no longer
outstanding, the remaining Group 5 Senior Certificates, pro rata based on their respective Class Principal Balances, provided,
however, that the aggregate amount that would otherwise be allocable to the Class 5-A-3-1 Certificates and Class 5-A-3-2 Certificates
on any Distribution Date will instead be applied first, to the Class 5-A-3-2 Certificates and second, to the Class 5-A-3-1
Certificates, in each case until the respective Class Principal Balance thereof has been reduced to zero. Any Applied Loss Amount
allocated to a Class of LIBOR Certificates shall be allocated among the Certificates of such Class in proportion to their respective
Percentage Interests.
(f) All Realized Losses on the Group 1, Group 2, Group 3 and Group 4 Mortgage Loans shall be allocated on each
Distribution Date to the REMIC I Regular Interests as provided in the definition of REMIC I Realized Losses.
(g) All Realized Losses on the Group 5 Mortgage Loans shall be allocated on each Distribution Date to the
REMIC II Regular Interests as provided in the definition of REMIC II Realized Losses.
-58-
(h) Realized Losses on the Group 5 Mortgage Loans that are not Applied Loss Amounts shall be deemed allocated
to the Class 5-X Certificates. Realized Losses allocated to the Class 5-X Certificates shall, be allocated between the REMIC III
Regular Interests 5-X-IO and 5-X-PO as provided in the definition of Realized Losses.
(i) Realized Losses shall be allocated among the REMIC I, REMIC II and REMIC III Regular Interests as specified
in the definition of Realized Losses and, as to REMIC I and REMIC II Regular Interests, in the definitions of REMIC I Realized Losses
and REMIC II Realized Losses, respectively.
SECTION 4.03. Recoveries.
(a) With respect to any Class of Certificates to which a Realized Loss or Applied Loss Amount, as applicable,
has been allocated (including any such Class for which the related Class Principal Balance has been reduced to zero), the Class
Principal Balance of such Class will be increased, up to the amount of related Recoveries for such Distribution Date as follows:
(i) with respect to Recoveries on Group 1, Group 2, Group 3 and Group 4, Mortgage Loans,
(A) first, the Class Principal Balance of each Class of Senior Certificates related to the
Loan Group from which the Recovery was collected, will be increased pro rata, up to the amount of Net Recovery
Realized Losses for each such Class, and
(B) second, the Class Principal Balance of each Class of Class C-B Certificates will be
increased in order of seniority, up to the amount of Net Recovery Realized Losses for each such Class; or
(ii) with respect to Recoveries on Group 5 Mortgage Loans, the Class Principal Balance of the LIBOR
Certificates will be increased in order of seniority, up to the Deferred Amount such Class is entitled to receive pursuant
to Section 4.01(II)(d) on such Distribution Date prior to giving effect to payments pursuant to Section 4.01(II)(d) on such
Distribution Date.
(b) Any increase to the Class Principal Balance of a Class of Certificates shall increase the Certificate
Balance of the related Class pro rata in accordance with each Certificate Percentage Interest.
SECTION 4.04. Monthly Statements to Certificateholders.
As set forth in Section 4.04 of the Standard Terms.
SECTION 4.05. Servicer to Cooperate.
As set forth in Section 4.05 of the Standard Terms.
-59-
SECTION 4.06. Cross-Collateralization; Adjustments to Available Funds.
(a) On each Distribution Date prior to the Class C-B Credit Support Depletion Date, but after the date on which
the aggregate Class Principal Balance of the Group 1, Group 2, Group 3 or Group 4 Certificates has been reduced to zero, the Trust
Administrator shall distribute the principal portion of Available Distribution Amount on the Mortgage Loans relating to such Senior
Certificates that will have been paid in full, to the holders of the Senior Certificates of the other Certificate Group(s). Such
amount will be allocated between the other Groups, pro rata, based on aggregate Class Principal Balance of the related Senior
Certificates and paid the Senior Certificates in each such Group in the same priority as such Certificates would receive other
distributions of principal pursuant to Section 4.01(I)(A); provided, however, that the Trust Administrator shall not make such
distribution on such Distribution Date if (a) the Class C-B Percentage for such Distribution Date is greater than or equal to 200% of
such Class C-B Percentage as of the Closing Date and (b) the average outstanding principal balance of the Mortgage Loans in each Loan
Group delinquent 60 days or more over the last six months, as a percentage of the related Subordinate Component Balance, is less than
50%.
(b) If on any Distribution Date the aggregate Class Principal Balance of the Group 1, Group 2, Group 3 or
Group 4 Certificates is greater than the Aggregate Loan Group Balance of the related Loan Group (each Loan Group related to such
Group of Certificates, an "Undercollateralized Group"), then the Trust Administrator shall reduce the Available Distribution Amount of
the other Loan Group(s) that is not undercollateralized (each, an "Overcollateralized Group"), as follows:
(1) to add to the Available Distribution Amount of the Undercollateralized Group(s) an amount equal to
the lesser of (a) one month's interest on the Principal Transfer Amount of the Undercollateralized Group(s) at the Net WAC
Rate applicable to the Undercollateralized Group(s) and (b) Available Distribution Amount of the Overcollateralized Groups
remaining after making interest distributions to the Senior Certificates of the Overcollateralized Group(s) on such
Distribution Date pursuant to Section 4.01; and
(2) to the Senior Certificates of each Undercollateralized Group, to the extent of the principal
portion of Available Distribution Amount of the Overcollateralized Group(s) remaining after making interest and principal
distributions to the Senior Certificates of the Overcollateralized Group(s) on such Distribution Date pursuant to
Section 4.01, until the Class Principal Balance of the Senior Certificates of such Undercollateralized Group(s) equals the
Aggregate Loan Group Balance of the related Loan Group(s). Payments shall be made to the Senior Certificates in each
Group in the same priority as such Certificates would receive other distributions of principal pursuant to Section 4.01(I)(A).
(c) If more than one Overcollateralized Group exists on any Distribution Date, reductions in the Available
Distribution Amount of such Groups to make the payments required to be made pursuant to Section 4.07(b) on such Distribution Date
shall be made pro rata, based on the Overcollateralization Amount of each Overcollateralized Group. If more than one
Undercollateralized Group exists on any Distribution Date, payments made to such Groups from the Available Distribution Amount of the
Overcollateralized Group shall be made pro rata, based on the amount of payments required to be made to the Undercollateralized
Group(s).
SECTION 4.07. Group 5 Interest Rate Cap Account.
(a) On the Closing Date, the Trust Administrator shall establish and maintain in its name, in trust for the
benefit of the Holders of the Class 5-X Certificates, the Group 5 Interest Rate Cap Account. The Group 5 Interest Rate Cap Account
shall be an Eligible Account, and funds on deposit therein shall be held separate and apart from, and shall not be commingled with,
any other moneys, including without limitation, other moneys held by the Trust Administrator pursuant to this Agreement.
-60-
(b) On each Distribution Date on and after the Distribution Date in March 2007 and on and prior to the
Distribution Date in September 2010, the Trust Administrator shall deposit any amounts paid under the Group 5 Interest Rate Cap
Agreement into the Group 5 Interest Rate Cap Account.
(c) On each Distribution Date on and after the Distribution Date in March 2007 and on and prior to the
Distribution Date in September 2010, the Trust Administrator shall distribute amounts on deposit in the Group 5 Interest Rate Cap
Account in the following order of priority:
(1) to the Group 5 Senior Certificates, pro rata based on the amount of any unpaid Current Interest
and Carryforward Interest, to the extent not paid from the Group 5 Interest Remittance Amount;
(2) sequentially, to the Class 5-M-1, Class 5-M-2, Class 5-M-3, Class 5-M-4, Class 5-M-5, Class 5-M-6,
Class 5-M-7, Class 5-M-8, Class 5-M-9 and Class 5-M-10 Certificates, in that order, any unpaid Current Interest and
Carryforward Interest, to the extent not paid from the Group 5 Interest Remittance Amount;
(3) to the Principal Remittance Amount, the Net Cumulative Realized Loss Amount for such Distribution
Date;
(4) first, to the Class 5-A-1, Class 5-A-2-1, Class 5-A-2-2, Class 5-A-3-1 and Class 5-A-3-2
Certificates, any Deferred Amount for such classes, pro rata, weighted based on the amounts due; provided, however, that the
aggregate Deferred Amounts that would otherwise be allocable to the Class 5-A-3-1 Certificates and Class 5-A-3-2
Certificates in the aggregate, will instead be allocated first, to the Class 5-A-3-1 Certificates until any Deferred Amount
for such Class has been paid in full, and then, to the Class 5-A-3-2 Certificates; second, to the Class 5-A-4 Certificates,
any Deferred Amount for such class; third, sequentially, to the Class 5-M-1, Class 5-M-2, Class 5-M-3, Class 5-M-4,
Class 5-M-5, Class 5-M-6, Class 5-M-7, Class 5-M-8, Class 5-M-9 and Class 5-M-10 Certificates, in that order, any Deferred
Amount for such Classes, in each case such amounts will be applied prior to giving effect to amounts available to be paid in
respect of Deferred Amounts from Monthly Excess Cashflow;
(5) to the Group 5 Senior Certificates, the amount of any unpaid Basis Risk Shortfalls for such Class,
pro rata, weighted based on the amounts due, in each case such amounts will be applied prior to giving effect to amounts
available to be paid in respect of Basis Risk Shortfalls from Monthly Excess Cashflow;
(6) sequentially, to the Class 5-M-1, Class 5-M-2, Class 5-M-3, Class 5-M-4, Class 5-M-5, Class 5-M-6,
Class 5-M-7, Class 5-M-8, Class 5-M-9 and Class 5-M-10 Certificates, in that order, the amount of any unpaid Basis Risk
Shortfalls for such class, in each case such amounts will be applied prior to giving effect to amounts available to be paid
in respect of Basis Risk Shortfalls from Monthly Excess Cashflow; and
(7) to the Class 5 X Certificates.
-61-
(d) Funds in the Group 5 Interest Rate Cap Account may be invested in Eligible Investments by the Trust
Administrator at the direction of the Depositor maturing on or prior to the next succeeding Distribution Date. The Trust
Administrator shall account for the Group 5 Interest Rate Cap Account as an outside reserve fund within the meaning of Treasury
regulation 1.860G-2(h) and not an asset of any REMIC created pursuant to this Agreement. The Trust Administrator shall treat amounts
paid by the Group 5 Interest Rate Cap Account as payments made from outside the REMIC's for all Federal tax purposes. Any net
investment earnings on such amounts shall be payable to the Depositor. The Depositor will be the owner of the Group 5 Interest Rate
Cap Account for federal tax purposes and the Depositor shall direct the Trust Administrator in writing as to the investment of
amounts therein. In the absence of such written direction, all funds in the Group 5 Interest Rate Cap Account may be invested by the
Trust Administrator in the Xxxxx Fargo Advantage Prime Investment Money Market Fund or any successor fund. The Trust Administrator
shall have no liability for losses on investments in Eligible Investments made pursuant to this Section 4.10(c) (other than as
obligor on any such investments). Upon termination of the Trust Fund, any amounts remaining in the Group 5 Interest Rate Cap Account
shall be distributed to the Class 5-X Certificateholders.
(e) On the Distribution Date immediately after the Distribution Date on which the aggregate Class Principal
Balance of the LIBOR Certificates equals zero, any amounts on deposit in the Group 5 Interest Rate Cap Account not payable on the
LIBOR Certificates shall be distributed to the Class 5-X Certificateholders.
(f) Amounts paid under the Group 5 Interest Rate Cap Agreement not used on any Distribution Date as described
in Section 4.10(b) shall remain on deposit in the Group 5 Interest Rate Cap Account and may be available on future Distribution Dates
to make the payments described in Section 4.10(b). However, at no time shall the amount on deposit in the Group 5 Interest Rate Cap
Account exceed the related Deposit Amount. The "Deposit Amount" with respect to the Group 5 Interest Rate Cap Account will be
calculated on each Distribution Date, after giving effect to withdrawals from the Group 5 Interest Rate Cap Account on such
Distribution Date and distributions and allocation of losses on the Certificates on such Distribution Date, and will equal the
excess, if any, of the Targeted Overcollateralization Amount for such Distribution Date over the Overcollateralization Amount for
such Distribution Date. On each Distribution Date, the Trust Administrator shall distribute amounts in the Group 5 Interest Rate Cap
Account in excess of the related Deposit Amount to the Class 5-X Certificateholders.
(g) The Trust Administrator is hereby directed, on or prior to the Closing Date, on behalf of the Trust and not
in its individual capacity, to enter into the Group 5 Interest Rate Cap Agreement for the benefit of the Holders of the Group 5
Certificates, in the form presented to it by the Depositor. The Trust Administrator shall not individually or personally have any
responsibility for the contents, adequacy or sufficiency of the Group 5 Interest Rate Cap Agreement, including, without limitation,
any representations and warranties contained therein.
SECTION 4.08. Supplemental Interest Trust(s).
Not Applicable.
SECTION 4.09. Rights of Swap Counterparty.
Not Applicable.
-62-
SECTION 4.10. Replacement Swap Counterparty.
Not Applicable.
ARTICLE V
ADVANCES BY THE MASTER SERVICER AND SERVICERS
As set forth in ARTICLE V of the Standard Terms.
ARTICLE VI
THE CERTIFICATES
As set forth in ARTICLE VI of the Standard Terms.
ARTICLE VII
THE DEPOSITOR, THE SELLER, THE MASTER
SERVICER, THE SERVICERS, THE SPECIAL SERVICER AND THE MODIFICATION OVERSIGHT AGENT
As set forth in ARTICLE VII of the Standard Terms.
ARTICLE VIII
DEFAULT
As set forth in ARTICLE VIII of the Standard Terms.
ARTICLE IX
CONCERNING THE TRUSTEE
As set forth in ARTICLE IX of the Standard Terms.
ARTICLE X
CONCERNING THE TRUST ADMINISTRATOR
As set forth in ARTICLE X of the Standard Terms.
ARTICLE XI
TERMINATION
SECTION 11.01. Termination upon Liquidation or Purchase of all Mortgage Loans.
The obligations and responsibilities of the Master Servicer, the Special Servicer, the Modification Oversight Agent,
the Servicers, the Seller, the Depositor, the Trustee and the Trust Administrator created hereby with respect to the related Loan
Group(s) created hereby shall terminate upon the earlier of:
-63-
(a) (i) with respect to any Related Pass-Through Loan Groups, the purchase by the Terminating Entity, at
its election, of all Mortgage Loans in such Related Pass-Through Loan Groups and all property acquired in respect of any
remaining Mortgage Loan in such Related Pass-Through Loan Groups, which purchase right the Terminating Entity may exercise
at its sole and exclusive election as of any Distribution Date (such applicable Distribution Date with respect to such
Mortgage Loans being herein referred to as the "Optional Termination Date") on or after the date on which the aggregate
Principal Balance of the Mortgage Loans in such Related Pass-Through Loan Groups, at the time of the purchase is less than
or equal to 10% of the Aggregate Related Pass-Through Collateral Balance for such Related Pass-Through Loan Groups as of the
Cut-off Date; or
(ii) with respect to the Floater Loan Group, the purchase by the Terminating Entity, at its election,
of all Mortgage Loans in such Floater Loan Group and all property acquired in respect of any remaining Mortgage Loan in such
Floater Loan Group, which purchase right the Terminating Entity may exercise at its sole and exclusive election as of any
Distribution Date (such applicable Distribution Date with respect to such Mortgage Loans being herein referred to as the
"Optional Termination Date") on or after the date on which the aggregate Principal Balance of the Mortgage Loans in such
Floater Loan Group, at the time of the purchase is less than or equal to 10% of the Aggregate Loan Group Balance for such
Floater Loan Group as of the Cut-off Date.
(b) the later of (i) twelve months after the maturity of the last Mortgage Loan remaining in the Trust Fund,
(ii) the liquidation (or any advance with respect thereto) of the last Mortgage Loan remaining in the Trust Fund and the disposition
of all REO Property and (iii) the distribution to Certificateholders of all amounts required to be distributed to them pursuant to
this Agreement; or
(c) (i) with respect to any Related Pass-Through Loan Groups, the purchase by the Terminating Auction Purchaser
of all Mortgage Loans in such Related Pass-Through Loan Groups and all property acquired in respect of any remaining
Mortgage Loan in such Related Pass-Through Loan Groups (with respect to such Related Pass-Through Loan Groups, the "Trust
Collateral") as described below; or
(ii) with respect to the Floater Loan Group, the purchase by the Terminating Auction Purchaser of all
Mortgage Loans in such Floater Loan Group and all property acquired in respect of any remaining Mortgage Loan in such
Floater Loan Group (with respect to such Floater Loan Group, the "Trust Collateral") as described below.
In no event shall the trust created hereby continue beyond the earlier of (i) the expiration of 21 years from the
death of the last survivor of the descendants of Xx. Xxxxxx X. Xxxxxxx, former Ambassador of the United States to Great Britain,
living on the date of execution of this Agreement or (ii) the Distribution Date following the third anniversary of the scheduled
maturity date of the Mortgage Loan having the latest scheduled maturity date as of the Cut-off Date.
The "Mortgage Loan Purchase Price" for any such Optional Termination shall be equal to the greater of (a) the sum of
(i) 100% of the Stated Principal Balance of each Mortgage Loan in the applicable Loan Group(s) (other than in respect of
REO Property) plus accrued and unpaid interest thereon from the date to which such interest was paid or advanced at the applicable
Mortgage Rate, to but not including the Due Date in the month of the final Distribution Date (or the Net Mortgage Rate with respect
to any related Mortgage Loan currently serviced by the entity exercising such Optional Termination) and (ii) with respect to any
REO Property, the lesser of (x) the appraised value of any REO Property as determined by the higher of two appraisals completed by two
independent appraisers selected by the Depositor at the expense of the Depositor and (y) the Stated Principal Balance of each related
Mortgage Loan related to any REO Property, in each case and (iii) any remaining unreimbursed Advances, Servicing Advances and unpaid
Servicing Fees (other than any remaining unreimbursed Advances and Servicing Advances and unpaid Servicing Fees, if any, due to the
Terminating Entity) and other amounts payable to the Trustee and Trust Administrator (the sum of (i), (ii) and (iii), collectively,
the "Par Value") and (b) the Fair Market Value of all of the property of the Trust related to the Loan Group(s) subject to such
Optional Termination.
-64-
The "Fair Market Value" shall be the fair market value of all of the property of the Trust related to the Loan
Group(s) subject to an Optional Termination, as agreed upon between the Terminating Entity and a majority of the holders of the Class
AR-L Certificates; provided, however, that if the Terminating Entity and a majority of the holders of the Class AR-L Certificates do
not agree upon the fair market value of such property of the Trust, the Terminating Entity, or an agent appointed by the Terminating
Entity, shall solicit bids for such property of the Trust until it has received three bids, and the Fair Market Value shall be equal
to the highest of such three bids. The Trust Administrator shall give notice to the Rating Agencies of any election to purchase
Mortgage Loans pursuant to this Section 11.01 and of the applicable Optional Termination Date.
(d) On any Distribution Date on or after the date on which the aggregate Principal Balance of the Mortgage
Loans in any Related Pass-Through Loan Groups is less than 5% of the Aggregate Related Pass-Through Collateral Balance for such
Related Pass-Through Loan Groups as of the Cut-off Date (a "Terminating Auction Date"), the Trust Administrator shall solicit bids
for the related Trust Collateral from at least three institutions that are regular purchasers and/or sellers in the secondary market
of residential whole mortgage loans similar to the Mortgage Loans. If the Trust Administrator receives at least three bids for the
related Trust Collateral, and one of such bids is equal to or greater than the Par Value, the Trust Administrator shall sell the
related Trust Collateral to the highest bidder (a "Terminating Auction Purchaser") at the price offered by the Terminating Auction
Purchaser (a "Mortgage Loan Terminating Auction Price"). If the Trust Administrator receives less than three bids, or does not
receive any bid that is equal to or greater than the Par Value, the Trust Administrator shall, on each six-month anniversary of the
initial Terminating Auction Date, repeat these auction procedures until the Trust Administrator receives a bid that is equal to or
greater than the Par Value, and upon receipt of such bid shall sell the related Trust Collateral to the Terminating Auction Purchaser
at that Mortgage Loan Terminating Auction Price; provided, however, that the Trust Administrator shall not be required to repeat
these auction procedures on any Distribution Date for any six-month anniversary of the initial Terminating Auction Date unless the
Trust Administrator reasonably believes that there is a reasonable likelihood of receiving a bid in excess of the Par Value. The
Trust Administrator shall give notice to the Rating Agencies and each Servicer that is servicing any of the related Mortgage Loans of
the sale of the related Trust Collateral pursuant to this Section 11.01 (a "Terminating Auction Sale") and of the Terminating Auction
Date. Notwithstanding anything to the contrary herein, the Terminating Auction Purchaser shall not be the Depositor, the Seller or
any of their respective Affiliates.
(e) On any Distribution Date on or after the date on which the aggregate Principal Balance of the Mortgage
Loans in the Floater Loan Group is less than 5% of the Aggregate Loan Group Balance for such Floater Loan Group as of the Cut-off
Date (a "Terminating Auction Date"), the Trust Administrator shall solicit bids for the related Trust Collateral from at least three
institutions that are regular purchasers and/or sellers in the secondary market of residential whole mortgage loans similar to the
Mortgage Loans; provided, however, that the Trust Administrator may not solicit any such bids at any time while there are NIM Notes
related to such Floater Loan Group outstanding. If the Trust Administrator receives at least three bids for the related Trust
Collateral, and one of such bids is equal to or greater than the Par Value, the Trust Administrator shall sell the related Trust
Collateral to the highest bidder (a "Terminating Auction Purchaser") at the price offered by the Terminating Auction Purchaser (a
"Mortgage Loan Terminating Auction Price"). If the Trust Administrator receives less than three bids, or does not receive any bid
that is equal to or greater than the Par Value, the Trust Administrator shall, on each six-month anniversary of the initial
Terminating Auction Date, repeat these auction procedures until the Trust Administrator receives a bid that is equal to or greater
than the Par Value, and upon receipt of such bid shall sell the related Trust Collateral to the Terminating Auction Purchaser at that
Mortgage Loan Auction Price; provided, however, that the Trust Administrator shall not be required to repeat these auction procedures
on any Distribution Date for any six-month anniversary of the initial Terminating Auction Date unless the Trust Administrator
reasonably believes that there is a reasonable likelihood of receiving a bid in excess of the Par Value. The Trust Administrator
shall give notice to the Rating Agencies and each Servicer that is servicing any of the related Mortgage Loans of the sale of the
related Trust Collateral pursuant to this Section 11.01 (a "Terminating Auction Sale") and of the Terminating Auction Date.
Notwithstanding anything to the contrary herein, the Terminating Auction Purchaser shall not be the Depositor, the Seller or any of
their respective Affiliates.
-65-
SECTION 11.02. Determination of the Terminating Entity.
(a) If any Servicer intends to be the Terminating Entity, such party must give written notice to the Trust
Administrator no later than twenty (20) days prior to the first day of the Optional Termination Notice Period. Such notice shall
also indicate the Loan Group(s) of the Mortgage Loans to be repurchased. Upon receiving such notice, the Trust Administrator shall
immediately request from DLJMC and DLJMC shall deliver no later than seventeen (17) days prior to the first day of the Optional
Termination Notice Period a letter indicating whether or not DLJMC retains the servicing rights to any Mortgage Loan in any of the
related Loan Groups.
(b) With respect to the purchase of Mortgage Loans in any Loan Group(s) as described in Section 11.01(a), the
Trust Administrator shall determine the "Terminating Entity" as follows:
(i) DLJMC, if it is the owner of the servicing rights with respect to any such Mortgage Loans on the
related Optional Termination Date;
(ii) SPS, if (a) DLJMC is not the owner of the servicing rights with respect to any such Mortgage Loans
on the related Optional Termination Date and (b) SPS is a Servicer with respect to any such Mortgage Loans on the related
Optional Termination Date and SPS has given notice to the Trust Administrator pursuant to Section 11.02(a) above; or
(iii) the Majority Servicer on the related Optional Termination Date, if (a) DLJMC is not the owner of
the servicing rights with respect to any such Mortgage Loans on the related Optional Termination Date and (b) SPS has not
given notice to the Trust Administrator pursuant to Section 11.02(a) above.
(c) No later than fifteen (15) days prior to the first day of any Optional Termination Notice Period, the Trust
Administrator shall provide notice to each Servicer that is a servicer of any of the Mortgage Loans in the related Loan Group(s) of
the identity of the Terminating Entity for such Loan Group(s).
SECTION 11.03. Procedure Upon Optional Termination or Terminating Auction Sale.
-66-
(a) In case of any Optional Termination, the Terminating Entity shall, no later than ten (10) days prior to the
first day of the related Optional Termination Notice Period, notify the Trustee and Trust Administrator of such Optional Termination
Date and of the applicable purchase price of the Mortgage Loans to be purchased. Upon purchase by the Terminating Entity of any
Mortgage Loans pursuant to Section 11.01, the Trust Administrator shall notify each Servicer that is servicing any of such Mortgage
Loans (and with respect to the purchase of the Mortgage Loans in any Loan Group to which a Swap or a Cap relates, the related
Counterparty) of such purchase.
(b) Any purchase of the Mortgage Loans by the Terminating Entity shall be made on an Optional Termination Date
by deposit of the applicable purchase price into the Certificate Account before the Distribution Date on which such purchase is
effected. Upon receipt by the Trust Administrator of an Officer's Certificate of the Terminating Entity certifying as to the deposit
of such purchase price into the Certificate Account, the Trustee, the Trust Administrator and each co-trust administrator and
separate trust administrator, if any, then acting as such under this Agreement, shall, upon request and at the expense of the
Terminating Entity execute and deliver all such instruments of transfer or assignment, in each case without recourse, as shall be
reasonably requested by the Terminating Entity to vest title in the Terminating Entity in the Mortgage Loans so purchased and shall
transfer or deliver to the Terminating Entity the purchased Mortgage Loans. Any distributions on the Mortgage Loans which have been
subject to an Optional Termination received by the Trust Administrator subsequent to (or with respect to any period subsequent to)
the Optional Termination Date shall be promptly remitted by it to the Terminating Entity.
(c) Any purchase of the Trust Collateral by the related Terminating Auction Purchaser shall be made on an
Terminating Auction Date by receipt of the Trust Administrator of the related Mortgage Loan Terminating Auction Price from the
Terminating Auction Purchaser, and deposit of such Mortgage Loan Terminating Auction Price into the Certificate Account by the Trust
Administrator before the Distribution Date on which such purchase is effected. Upon deposit of such purchase price into the
Certificate Account, the Trustee and the Trust Administrator and each co-trust administrator and separate trust administrator, if
any, then acting as such under this Agreement, shall, upon request and at the expense of the Terminating Auction Purchaser execute
and deliver all such instruments of transfer or assignment, in each case without recourse, as shall be reasonably requested by the
Terminating Auction Purchaser to vest title in the Terminating Auction Purchaser in the Trust Collateral so purchased and shall
transfer or deliver to the Terminating Auction Purchaser the purchased Trust Collateral.
(d) Notice of the Distribution Date on which the Trust Administrator anticipates that the final distribution
shall be made on a Class of Certificates (whether upon Optional Termination, Terminating Auction Sale or otherwise), shall be given
promptly by the Trust Administrator by first class mail to Holders of the affected Certificates. Such notice shall be mailed no
earlier than the 15th day and not later than the 10th day preceding the applicable Optional Termination Date, Terminating Auction
Date or date of final distribution, as the case may be. Such notice shall specify (i) the Distribution Date upon which final
distribution on the affected Certificates shall be made upon presentation and surrender of such Certificates at the office or agency
therein designated, (ii) the amount of such final distribution and (iii) that the Record Date otherwise applicable to such
Distribution Date is not applicable, such distribution being made only upon presentation and surrender of such Certificates at the
office or agency maintained for such purposes (the address of which shall be set forth in such notice).
(e) In the event that any Certificateholders shall not surrender Certificates for cancellation within six
months after the date specified in the above mentioned written notice, the Trust Administrator shall give a second written notice to
the remaining such Certificateholders to surrender their Certificates for cancellation and receive the final distribution with
respect thereto. If within six months after the second notice all the Certificates shall not have been surrendered for cancellation,
the Trust Administrator may take appropriate steps, or may appoint an agent to take appropriate steps, to contact the remaining
Certificateholders concerning surrender of their Certificates, and the cost thereof shall be paid out of the funds and other assets
which remain subject to the Trust Fund.
-67-
(f) Notwithstanding anything to the contrary herein, the occurrence of an Optional Termination or Terminating
Auction Sale shall be subject to, and shall in no way adversely affect, the rights of the owner of the servicing rights related to
the Mortgage Loans purchased in such Optional Termination or Terminating Auction Sale.
SECTION 11.04. Additional Termination Requirements.
(a) In the event the Terminating Entity exercises its purchase option pursuant to Section 11.01(A) or a
Terminating Auction Sale shall have occurred pursuant to Section 11.01(c), the related subsidiary REMIC shall be terminated in
accordance with the following additional requirements, unless the Trustee and the Trust Administrator have received an Opinion of
Counsel to the effect that the failure to comply with the requirements of this Section 11.04 will not (i) result in the imposition of
taxes on a "prohibited transaction" of any REMIC created hereunder, as described in Section 860F of the Code, or (ii) cause any REMIC
created hereunder to fail to qualify as a REMIC at any time that any Certificates are outstanding:
(i) within 90 days prior to the final Distribution Date set forth in the notice given by Terminating
Entity under Section 11.03, the Holder of the related Residual Certificates shall adopt a plan of complete liquidation for
the related REMIC; and
(ii) at or after the time of adoption of any such plan of complete liquidation for such REMIC and at or
prior to the final Distribution Date, the Trustee shall sell all of the assets of such REMIC to the Depositor for cash.
(b) Upon the exercise of an Optional Termination by the Terminating Entity or upon the occurrence of a
Terminating Auction Sale in respect of the final remaining subsidiary REMIC (the "Remaining Subsidiary REMIC") pursuant to
Section 11.01, each remaining REMIC shall be terminated in accordance with the following additional requirements, unless the Trustee
and the Trust Administrator have received an Opinion of Counsel to the effect that the failure to comply with the requirements of
this Section 11.04 will not (i) result in the imposition of taxes on a "prohibited transaction" of a REMIC, as described in
Section 860F of the Code, or (ii) cause any REMIC created hereunder to fail to qualify as a REMIC at any time that any Certificates
are outstanding:
(i) concurrently with the adoption of the plan of complete liquidation of the Remaining Subsidiary
REMIC, as set forth in paragraph (a) of this Section 11.04, the Holder of the related Residual Certificates, as applicable,
shall adopt a plan of complete liquidation of each remaining REMIC; and
(ii) at or after the time of adoption of any such plan of complete liquidation for each such remaining
REMIC, at or prior to the final Distribution Date of the Remaining Subsidiary REMIC to be terminated, the Trustee shall sell
all of the assets of each such remaining REMIC to the Depositor for cash.
(c) By its acceptance of a Residual Certificate, the Holder thereof hereby agrees to adopt such a plan of
complete liquidation and to take such other action in connection therewith as may be reasonably required to liquidate and otherwise
terminate the related REMIC created pursuant to this Agreement.
-68-
ARTICLE XII
MISCELLANEOUS PROVISIONS
As set forth in ARTICLE XII of the Standard Terms.
ARTICLE XIII
EXCHANGE ACT REPORTING
As set forth in ARTICLE XIII of the Standard Terms.
-68-
IN WITNESS WHEREOF, the Depositor, the Seller, the Trust Administrator, the Master Servicer, the Trustee, the
Special Servicer, the Modification Oversight Agent and the Servicers have caused their names to be signed hereto by their respective
officers thereunto duly authorized all as of the date first written above.
CREDIT SUISSE FIRST BOSTON MORTGAGE SECURITIES CORP.,
as Depositor
By:______________________________________
Name:
Title:
DLJ MORTGAGE CAPITAL, INC.,
as Seller
By:______________________________________
Name:
Title:
XXXXX FARGO BANK, N.A.,
as Trust Administrator and as Master Servicer
By:______________________________________
Name:
Title:
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:______________________________________
Name:
Title:
XXXXX FARGO BANK, N.A.,
as a Servicer
By:______________________________________
Name:
Title:
SELECT PORTFOLIO SERVICING, INC.,
as a Servicer, Special Servicer and Modification Oversight Agent
By:______________________________________
Name:
Title:
WASHINGTON MUTUAL MORTGAGE SECURITIES CORP.,
as a Servicer
By:______________________________________
Name:
Title:
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
On this __ day of February, 2007, before me, personally appeared _____________, known to me to be a Vice President of Credit Suisse
First Boston Mortgage Securities Corp., one of the corporations that executed the within instrument, and also known to me to be the
person who executed it on behalf of said corporation, and acknowledged to me that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this certificate first above written.
Notary Public
[NOTARIAL SEAL]
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
On the __ day of February, 2007, before me, personally appeared ____________, known to me to be a Vice President of DLJ Mortgage
Capital, Inc., one of the corporations that executed the within instrument and also known to me to be the person who executed it on
behalf of said corporation, and acknowledged to me that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this certificate first above written.
Notary Public
[NOTARIAL SEAL]
STATE OF _____________)
: ss.:
COUNTY OF _____________)
On the _____ day of February, 2007 before me, a Notary Public in and for said State, personally appeared ____________________, known
to me to be a __________________ of SPS, the Utah 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 limited partnership executed the within
instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this certificate first above written.
Notary Public
[NOTARIAL SEAL]
STATE OF )
: ss.:
COUNTY OF )
On the _____ day of February, 2007 before me, a Notary Public in and for said State, personally appeared ____________________, known
to me to be a __________________ of Xxxxx Fargo Bank, N.A., the national banking association that executed the within instrument and
also known to me to be the person who executed it on behalf of said national banking association, and acknowledged to me that such
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.
Notary Public
[NOTARIAL SEAL]
STATE OF )
: ss.:
COUNTY OF )
On the _____ day of February, 2007 before me, a Notary Public in and for said State, personally appeared ____________________, known
to me to be a __________________ of Xxxxx Fargo Bank, N.A., the national banking association that executed the within instrument and
also known to me to be the person who executed it on behalf of said national banking association, and acknowledged to me that such
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.
Notary Public
[NOTARIAL SEAL]
STATE OF )
: ss.:
COUNTY OF )
On the _____ day of February, 2007 before me, a Notary Public in and for said State, personally appeared ____________________, known
to me to be a __________________ of Xxxxx Fargo Bank, N.A., the national banking association that executed the within instrument and
also known to me to be the person who executed it on behalf of said national banking association, and acknowledged to me that such
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.
Notary Public
[NOTARIAL SEAL]
STATE OF )
: ss.:
COUNTY OF )
On the _____ day of February, 2007 before me, a Notary Public in and for said State, personally appeared ____________________, known
to me to be a __________________ of Xxxxx Fargo Bank, N.A., the national banking association that executed the within instrument and
also known to me to be the person who executed it on behalf of said national banking association, and acknowledged to me that such
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.
Notary Public
[NOTARIAL SEAL]
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
On the _____ day of February, 2007 before me, a Notary Public in and for said State, personally appeared ____________________, known
to me to be a __________________ of U.S. Bank National Association, the national banking association that executed the within
instrument and also known to me to be the person who executed it on behalf of said national banking association, and acknowledged to
me that such national banking association executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this certificate first above written.
Notary Public
[NOTARIAL SEAL]
STATE OF _____________)
: ss.:
COUNTY OF _____________)
On the _____ day of February, 2007 before me, a Notary Public in and for said State, personally appeared ____________________, known
to me to be a __________________ of Washington Mutual Mortgage Securities Corp., the company that executed the within instrument and
also known to me to be the person who executed it on behalf of said company, and acknowledged to me that such company executed the
within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this certificate first above written.
Notary Public
[NOTARIAL SEAL]
Exhibit A
Standard Terms of Pooling and Servicing Agreement
(see attached)
A-1
Schedule I
Mortgage Loan Schedule
(see attached)
I-1
Appendix A
Calculation of REMIC I Class Y Principal Reduction Amounts
Appendix 1
REMIC I Y Principal Reduction Amounts: For any Distribution Date the amounts by which the Uncertificated Principal
Balances of the REMIC I Regular Interests Y-1, Y-2, Y-3 and Y-4, respectively, will be reduced on such Distribution Date by the
allocation of Realized Losses and the distribution of principal, determined as follows:
First, for each of Loan Group 1, Loan Group 2, Loan Group 3 and Loan Group 4, determine its Weighted Average Adjusted Net Mortgage
Rate for distributions of interest that will be made on the next succeeding Distribution Date (the "Group Interest Rate"). The
Principal Reduction Amount for each of the REMIC I Y Certificates will be determined pursuant to the "Generic solution for the REMIC
I Y Principal Reduction Amounts" set forth below (the "Generic Solution") by making identifications among the actual Groups and their
related REMIC I Y and Z Regular Interests and the Weighted Average Adjusted Net Mortgage Rates and the Groups named in the Generic
Solution and their related REMIC I Y and Z Regular Interests as follows:
A. Determine which Group has the lowest Group Interest Rate. That Group will be identified with Group AA and the REMIC I Y and Z
Regular Interests related to that Group will be respectively identified with the REMIC I YAA and ZAA Regular Interests. The Group
Interest Rate for that Group will be identified with J%. If two or more Groups have the lowest Group Interest Rate pick one for this
purpose, subject to the restriction that each Group may be picked only once in the course of any such selections pursuant to
paragraphs A through D of this definition.
B. Determine which Group has the second lowest Group Interest Rate. That Group will be identified with Group BB and the REMIC I Y
and Z Regular Interests related to that Group will be respectively identified with the REMIC I YBB and ZBB Regular Interests. The
Group Interest Rate for that Group will be identified with K%. If two or more Groups have the second lowest Group Interest Rate pick
one for this purpose, subject to the restriction that each Group may be picked only once in the course of any such selections
pursuant to paragraphs A through D of this definition.
C. Determine which Group has the third lowest Group Interest Rate. That Group will be identified with Group CC and the REMIC I Y
and Z Regular Interests related to that Group will be respectively identified with the REMIC I YCC and ZCC Regular Interests. The
Group Interest Rate for that Group will be identified with L%. If two or more Groups have the third lowest Group Interest Rate pick
one for this purpose, subject to the restriction that each Group may be picked only once in the course of any such selections
pursuant to paragraphs A through D of this definition.
D. Determine which Group has the fourth lowest Group Interest Rate. That Group will be identified with Group DD and the REMIC I Y
and REMIC I Z Regular Interests related to that Group will be respectively identified with the REMIC I YDD and REMIC I ZDD Regular
Interests. The Group Interest Rate for that Group will be identified with M%. If two or more Groups have the fourth lowest Group
Interest Rate pick one for this purpose, subject to the restriction that each Group may be picked only once in the course of any such
selections pursuant to paragraphs A through D of this definition.
Second, apply the Generic Solution set forth below to determine the REMIC I Y Principal Reduction Amounts for the Distribution Date
using the identifications made above.
APPENDIX A-1
Generic Solution for the REMIC I Y Principal Reduction Amounts: For any Distribution Date, the amounts by which the
Uncertificated Principal Balances of the REMIC I YAA, YBB, YCC and YDD Regular Interests 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:
J% = the Weighted Average Adjusted Net Mortgage Rate for Group AA for interest to be distributed on the next succeeding
Distribution Date.
K% = the Weighted Average Adjusted Net Mortgage Rate for Group BB for interest to be distributed on the next succeeding
Distribution Date.
L% = the Weighted Average Adjusted Net Mortgage Rate for Group CC for interest to be distributed on the next succeeding
Distribution Date.
M% = the Weighted Average Adjusted Net Mortgage Rate for Group DD for interest to be distributed on the next succeeding
Distribution Date.
For purposes of the succeeding definitions and formulas, it is required that J%<=K%<=L%<=M%.
PJB = the Group AA Subordinated Portion after the allocation of Realized Losses and distributions of principal on such
Distribution Date.
PKB = the Group BB Subordinated Portion after the allocation of Realized Losses and distributions of principal on such
Distribution Date.
PLB = the Group CC Subordinates Portion after the allocation of Realized Losses and distributions of principal on such
Distribution Date.
PMB = the Group DD Subordinated Portion after the allocation of Realized Losses and distributions of principal on such
Distribution Date.
R = the Class CB Pass-Through Rate
= (J%PJB + K%PKB + L%PLB + M%PMB + N%PNB)/(PJB + PKB + PLB + PMB + PNB)
R11 = the weighted average of the Weighted Average Adjusted Net Mortgage Rates for Group AA, Group BB, Group CC and Group DD after
giving effect to the allocation of Realized Losses and distributions of principal to be made on such Distribution Date
= {J% (Pj - ΔPj) + K% (Pk - ΔPk) + L% (Pl - ΔPl) + M% (Pm - ΔPm)}/
(Pj - ΔPj + Pk - ΔPk + Pl - ΔPl + Pm - ΔPm)
R12 = the Group EE Pass-Through Rate
= N%
R21 = the weighted average of the Weighted Average Adjusted Net Mortgage Rates for Group AA, Group BB and Group CC after giving
effect to the allocation of Realized Losses and distributions of principal to be made on such Distribution Date
= {J% (Pj - ΔPj) + K% (Pk - ΔPk) + L% (Pl - ΔPl) }/(Pj - ΔPj + Pk - ΔPk + Pl - ΔPl )
APPENDIX A-2
R22 = the weighted average of the Weighted Average Adjusted Net Mortgage Rates for Group DD and Group EE
= { M% (Pm - ΔPm) + N% (Pn - ΔPn) }/( Pm - ΔPm + Pn - ΔPn )
R31 = the weighted average of the Weighted Average Adjusted Net Mortgage Rates for Group AA and Group BB after giving effect to
the allocation of Realized Losses and distributions of principal to be made on such Distribution Date
= {(J% (Pj - ΔPj) + K% (Pk - ΔPk) }/(Pj - ΔPj + Pk - ΔPk)
R32 = the weighted average of the Weighted Average Adjusted Net Mortgage Rates for Group CC, Group DD and Group EE after giving
effect to the allocation of Realized Losses and distributions of principal to be made on such Distribution Date
= { L% (Pl - ΔPl) + M% (Pm - ΔPm) + N% (Pn - ΔPn) }/( Pl - ΔPl + Pm - ΔPm + Pn - ΔPn)
R41 = the Weighted Average Adjusted Net Mortgage Rate for Group AA after giving effect to the allocation of Realized Losses and
distributions of principal to be made on such Distribution Date
= J%
R42 = the weighted average of the Weighted Average Adjusted Net Mortgage Rates for Group BB, Group CC, Group DD and Group EE after
giving effect to the allocation of Realized Losses and distributions of principal to be made on such Distribution Date
= {K% (Pk - ΔPk) + L% (Pl - ΔPl) + M% (Pm - ΔPm) + N% (Pn - ΔPn) }/
( Pk - ΔPk + Pl - ΔPl + Pm - ΔPm + Pn - ΔPn )
r11 = the weighted average of the REMIC I YAA, YBB, YCC and YDD Pass-Through Rates
= (J% Yj + K% Yk + L% Yl + M% Ym )/(Yj + Yk + Yl + Ym )
r12 = the REMIC I XXX Pass-Through Rate
= N%
r21 = the weighted average of the REMIC I YAA, YBB and YCC Pass-Through Rates
= (J% Yj + K% Yk + L% Yl )/(Yj + Yk + Yl )
r22 = the weighted average of the REMIC I YDD and XXX Pass-Through Rates
= ( M% Ym + N% Yn )/( Ym + Yn )
r31 = the weighted average of the REMIC I YAA and YBB Pass-Through Rates
= (J% Yj + K% Yk )/(Yj + Yk )
r32 = the weighted average of the REMIC I YCC, YDD and XXX Pass-Through Rates
= ( L% Yl + M% Ym + N% Yn)/( Yl + Ym + Yn )
r41 = the REMIC I YAA Pass-Through Rate
= J%
r42 = the weighted average of the REMIC I YBB, YCC, YDD and XXX Pass-Through Rates
= (K% Yk + L% Yl + M% Ym + N% Yn )/(Yk + Yl + Ym + Yn )
APPENDIX A-3
Yj = the Uncertificated Principal Balance of the REMIC I YAA Regular Interest after distributions on the prior Distribution Date.
Yk = the Uncertificated Principal Balance of the REMIC I YBB Regular Interest after distributions on the prior Distribution Date.
Yl = the Uncertificated Principal Balance of the REMIC I YCC Regular Interest after distributions on the prior Distribution Date.
Ym = the Uncertificated Principal Balance of the REMIC I YDD Regular Interest after distributions on the prior Distribution Date.
ΔYj = the REMIC I YAA Principal Reduction Amount.
ΔYk = the REMIC I YBB Principal Reduction Amount.
ΔYl = the REMIC I YCC Principal Reduction Amount.
ΔYm = the REMIC I YDD Principal Reduction Amount.
Zj = the Uncertificated Principal Balance of the ZAA Regular Interest after distributions on the prior Distribution Date.
Zk = the Uncertificated Principal Balance of the ZBB Regular Interest after distributions on the prior Distribution Date.
Zl = the Uncertificated Principal Balance of the ZCC Regular Interest after distributions on the prior Distribution Date.
Zm = the Uncertificated Principal Balance of the ZDD Regular Interest after distributions on the prior Distribution Date.
ΔZj = the REMIC I ZAA Principal Reduction Amount.
ΔZk = the REMIC I ZBB Principal Reduction Amount.
ΔZl = the REMIC I ZCC Principal Reduction Amount.
ΔZm = the REMIC I ZDD Principal Reduction Amount.
Pj = the aggregate Uncertificated Principal Balance of the REMIC I YAA and ZAA Regular Interests after distributions on the prior
Distribution Date.
= Yj + Zj
Pk = the aggregate Uncertificated Principal Balance of the REMIC I YBB and ZBB Regular Interests after distributions on the prior
Distribution Date.
= Yk + Zk
Pl = the aggregate Uncertificated Principal Balance of the REMIC I YCC and ZCC Regular Interests after distributions on the prior
Distribution Date.
APPENDIX A-4
= Yl + Zl =
Pm = the aggregate Uncertificated Principal Balance of the REMIC I YAA and ZAA Regular Interests after distributions on the prior
Distribution Date.
= Ym + Zm
Pn = the aggregate Uncertificated Principal Balance of the REMIC I YAA and ZAA Regular Interests after distributions on the prior
Distribution Date.
= Yn + Zn
ΔPj = the aggregate amount of principal reduction occurring with respect to Mortgage Loans in Loan Group AA from Realized
Losses or payments of principal to be allocated on such Distribution Date net of any such amounts allocated to the Class A-R
Certificate in respect of Component I thereof or to any class of principal only certificates created by ratio stripping
Mortgage Loans in Loan Group AA
= the aggregate of the REMIC I YAA and REMIC I ZAA Principal Reduction Amounts.
= ΔYj + ΔZj
ΔPk = the aggregate amount of principal reduction occurring with respect to Mortgage Loans in Loan Group BB from Realized
Losses or payments of principal to be allocated on such Distribution Date net of any such amounts allocated to the Class A-R
Certificate in respect of Component I thereof or to any class of principal only certificates created by ratio stripping
Mortgage Loans in Loan Group BB
= the aggregate of the REMIC I YBB and REMIC I ZBB Principal Reduction Amounts.
= ΔYk + ΔZk
ΔPl= the aggregate amount of principal reduction occurring with respect to Mortgage Loans in Loan Group CC from Realized
Losses or payments of principal to be allocated on such Distribution Date net of any such amounts allocated to the Class A-R
Certificate in respect of Component I thereof or to any class of principal only certificates created by ratio stripping
Mortgage Loans in Loan Group CC
= the aggregate of the REMIC I YCC and REMIC I ZCC Principal Reduction Amounts.
= ΔYl + ΔZl
ΔPm = the aggregate amount of principal reduction occurring with respect to Mortgage Loans in Loan Group DD from Realized
Losses or payments of principal to be allocated on such Distribution Date net of any such amounts allocated to the Class A-R
Certificate in respect of Component I thereof or to any class of principal only certificates created by ratio stripping
Mortgage Loans in Loan Group DD
= the aggregate of the REMIC IB YDD and REMIC I ZDD Principal Reduction Amounts.
= ΔYm + ΔZm
α = .0005
γ1 = (R - R11)/(R12 - R). If R=>M%, γ1 is a non-negative number unless its denominator is zero, in which event it
is undefined.
APPENDIX A-5
γ2 = (R - R21)/(R22 - R). If R=>L%, γ2 is a non-negative number unless its denominator is zero, in which event it
is undefined.
γ3 = (R - R31)/(R32 - R). If R=>K%, γ3 is a non-negative number unless its denominator is zero, in which event it
is undefined.
γ4 = (R - R41)/(R42 - R). If R<K%, γ4 is a non-negative number unless its denominator is zero, in which event it
is undefined.
If γ1 is undefined, ΔYj = Yj, ΔYk = Yk, ΔYl = Yl, ΔYm = Ym and ΔYn = (Yn/Pn)ΔPn.
If γ4 is zero, ΔYj = (Yj/Pj)ΔPj, ΔYk = Yk, ΔYl = Yl, ΔYm = Ym and ΔYn = Yn.
In the remaining situations, ΔYj, ΔYk, ΔYl, ΔYm and ΔYn shall be defined as follows:
I. If R=>M%, make the following additional definitions:
δ1Yj = 0, if R11< r11;
(R11- r11)( Yj + Yk + Yl + Ym)Yj/
{(R11 - J%)Yj + (R11 - K%)Yk + (R11 - L%)Yl +
(R11 - M%)Ym }, if R11=> r11 and R11=>M%;
(R11- r11)( Yj + Yk + Yl + Ym )Yj/
{(R11 - J%)Yj + (R11 - K%)Yk + (R11 - L%)Yl }, if R11=> r11 and M%>R11=>L%;
(R11- r11)( Yj + Yk + Yl + Ym )Yj/
{(R11 - J%)Yj + (R11 - K%)Yk }, if R11=> r11 and L%>R11=>K%; and
(R11- r11)( Yj + Yk + Yl + Ym )/(R11 - J%), if R11=> r11 and K%>R11=>J%.
δ1Yk = 0, if R11< r11 and R11=>K%;
(R11- r11)( Yj + Yk + Yl + Ym)Yk/
{ (R11 - K%)Yk + (R11 - L%)Yl + (R11 - M%)Ym }, if R11< r11 and R11<K%;
(R11- r11)( Yj + Yk + Yl + Ym )Yk/
{(R11 - J%)Yj + (R11 - K%)Yk + (R11 - L%)Yl +
(R11 - M%)Ym }, if R11=> r11 and R11=>M%;
(R11- r11)( Yj + Yk + Yl + Ym )Yk/
{(R11 - J%)Yj + (R11 - K%)Yk + (R11 - L%)Yl }, if R11=> r11 and M%>R11=>L%;
(R11- r11)( Yj + Yk + Yl + Ym )Yk/{(R11 - J%)Yj + (R11 - K%)Yk }, if R11=> r11 and L%>R11=>K%; and
APPENDIX A-6
0, if R11=> r11 and R11<K%.
δ1Yl = 0, if R11< r11 and R11=>L%;
(R11- r11)( Yj + Yk + Yl + Ym)Yl/
{ (R11 - L%)Yl + (R11 - M%)Ym }, if R11< r11 and K%<=R11<L%;
(R11- r11)( Yj + Yk + Yl + Ym)Yl/
{ (R11 - K%)Yk + (R11 - L%)Yl + (R11 - M%)Ym }, if R11< r11 and R11<K%;
(R11- r11)( Yj + Yk + Yl + Ym)Yl/
{(R11 - J%)Yj + (R11 - K%)Yk + (R11 - L%)Yl +
(R11 - M%)Ym }, if R11=> r11 and R11=>M%;
(R11- r11)( Yj + Yk + Yl + Ym )Yl/
{(R11 - J%)Yj + (R11 - K%)Yk + (R11 - L%)Yl }, if R11=> r11 and M%>R11=>L%;
0, if R11=> r11 and R11<L%.
δ1Ym = 0, if R11< r11 and R11=>M%;
(R11- r11)( Yj + Yk + Yl + Ym)/(R11 - M%), if R11< r11 and L%<=R11<M%;
(R11- r11)( Yj + Yk + Yl + Ym)Ym/
{ (R11 - L%)Yl + (R11 - M%)Ym }, if R11< r11 and K%<=R11<L%;
(R11- r11)( Yj + Yk + Yl + Ym)Ym/
{ (R11 - K%)Yk + (R11 - L%)Yl + (R11 - M%)Ym }, if R11< r11 and R11<K%;
(R11- r11)( Yj + Yk + Yl + Ym)Ym/
{(R11 - J%)Yj + (R11 - K%)Yk + (R11 - L%)Yl +
(R11 - M%)Ym }, if R11=> r11 and R11=>M%;
0, if R11=> r11 and R11<M%.
δ1Yj, δ1Yk, δ1Yl and δ1Ym are numbers respectively between Yj, Yk, Yl and Ym and 0 such that
{J%(Yj - δ1Yj ) + K%( Yk.- δ1Yk) + L%( Yl.- δ1Yl) + M%( Ym.- δ1Ym) }/
(Yj - δ1Yj + Yk.- δ1Yk + Yl.- δ1Yl + Ym.- δ1Ym)
= R11.
Y11 = Yj - δ1Yj + Yk.- δ1Yk + Yl.- δ1Yl + Ym.- δ1Ym
P11 = Pj + Pk + Pl + Pm.
Z11 = Zj + Zk + Zl + Zm.
APPENDIX A-7
ΔY11 = ΔYj - δ1Yj + ΔYk.- δ1Yk + ΔYl.- δ1Yl + ΔYm.- δ1Ym .
ΔP11 = ΔPj + ΔPk + ΔPl + ΔPm.
ΔZ11 = ΔZj + ΔZk + ΔZl + ΔZm.
1. If Yn - α(Pn - ΔPn) => 0, Y11- α(P11 - ΔP11) => 0, and γ1(P11 - ΔP11) < (Pn - ΔPn),
then ΔYn = Yn - αγ1(P11 - ΔP11) and ΔY11 = Y11 - α(P11 - ΔP11).
2. If Yn - α(Pn - ΔPn) => 0, Y11 - α(P11 - ΔP11) => 0, and γ1(P11 - ΔP11) => (Pn - ΔPn),
then ΔYn = Yn - α(Pn - ΔPn) and ΔY11 = Y11 - (α/γ1)(Pn - ΔPn).
3. If Yn - α(Pn - ΔPn) < 0, Y11 - α(P11 - ΔP11) => 0, and Y11 - α(P11 - ΔP11) =>
Y11 - (Yn/γ1), then ΔYn = Yn - αγ1(P11 - ΔP11) and ΔY11 = Y11 - α(P11 - ΔP11).
4. If Yn - α(Pn - ΔPn) < 0, Y11 - (Yn/γ1) => 0, and Y11 - α(P11 - ΔP11) <= Y11 - (Yn/γ1), then
ΔYn = 0 and ΔY11 = Y11 - (Yn/γ1).
5. If Y11 - α(P11 - ΔP11) < 0, Y11 - (Yn/γ1) < 0, and Yn - α(Pn - ΔPn) <= Yn - (γ1Y11), then
ΔYn = Yn - (γ1Y11) and ΔY11 = 0.
6. If Y11 - α(P11 - ΔP11) < 0, Yn - α(Pn - ΔPn) => 0, and Yn - α(Pn - ΔPn) =>
Yn - (γ1Y11), then ΔYn = Yn - α(Pn - ΔPn) and ΔY11 = Y11 - (α/γ1)(Pn - ΔPn).
ΔYj = δ1Yj + [(Yj - δ1Yj )/Y11 ]Δ Y11
ΔYk = δ1Yk + [(Yk - δ1Yk )/Y11 ]ΔY11
ΔYl = δ1Yl + [(Yl - δ1Yl )/Y11 ]Δ Y11
ΔYm = δ1Ym + [(Ym - δ1Ym )/Y11 ]ΔY11
The purpose of the foregoing definitional provisions together with the related provisions allocating Realized Losses and defining the
REMIC I Y and REMIC I Z Principal Distribution Amounts is to accomplish the following goals in the following order of priority:
1. Making the ratio of (Yn - ΔYn ) to (Y11 - ΔY11 ) equal to γ1 after taking account of the allocation Realized Losses and the
distributions that will be made through the end of the Distribution Date to which such provisions relate and assuring that the
Principal Reduction Amount for each of the REMIC I YAA, YBB, YCC, YDD, ZAA, ZBB, ZCC and ZDD Regular Interests is greater than or
equal to zero for such Distribution Date;
2. Making the REMIC I YAA Uncertificated Principal Balance less than or equal to 0.0005 of the sum of the REMIC I YAA and REMIC I
ZAA Uncertificated Principal Balances, the REMIC I YBB Uncertificated Principal Balance less than or equal to 0.0005 of the sum
of the REMIC I YBB and REMIC I ZBB Uncertificated Principal Balances, the REMIC I YCC Uncertificated Principal Balance less than
or equal to 0.0005 of the sum of the REMIC I YCC and REMIC I ZCC Uncertificated Principal Balances, the REMIC I YDD
Uncertificated Principal Balance less than or equal to 0.0005 of the sum of the REMIC I YDD and REMIC I ZDD Uncertificated
Principal Balances in each case after giving effect to allocations of Realized Losses and distributions to be made through the
end of the Distribution Date to which such provisions relate; and
APPENDIX A-8
3. Making the larger of (a) the fraction whose numerator is (Yn - ΔYn ) and whose denominator is the sum of (Yn - ΔYn) and (Zn -
ΔZn) and (b) the fraction whose numerator is (Y11 - ΔY11) and whose denominator is the sum of (Y11 - ΔY11) and (Z11 - ΔZ11) as
large as possible while remaining less than or equal to 0.0005.
In the event of a failure of the foregoing portion of the definition of REMIC I Y Principal Reduction Amount to accomplish both of
goals 1 and 2 above, the amounts thereof should be adjusted to so as to accomplish such goals within the requirement that each REMIC
I Y Principal Reduction Amount must be less than or equal to the sum of (a) the Principal Realized Losses to be allocated on the
related Distribution Date for the related Pool remaining after the allocation of such Realized Losses to the related class of
ratio-strip principal only certificates, if any, and (b) the remainder of the Available Distribution Amount for the related Pool or
after reduction thereof by the distributions to be made on such Distribution Date (i) to the related class of ratio-strip principal
only certificates, if any, (ii) to the related class of ratio-strip interest only certificates, if any, and (iii) in respect of
interest on the related REMIC I Y and REMIC I Z Certificates, or, if both of such goals cannot be accomplished within such
requirement, such adjustment as is necessary shall be made to accomplish goal 1 within such requirement. In the event of any
conflict among the provisions of the definition of the REMIC I Y Principal Reduction Amounts, such conflict shall be resolved on the
basis of the goals and their priorities set forth above within the requirement set forth in the preceding sentence. If the formula
allocation of ΔY11 among ΔYj, ΔYk, ΔYl and ΔYm cannot be achieved because one or more of ΔYj, ΔYk, ΔYl and ΔYm, as so defined is
greater than the related one of ΔPj, ΔPk, ΔPl and ΔPm, such an allocation shall be made as close as possible to the formula
allocation within the requirement that ΔYj < ΔPj, ΔYk < ΔPk, ΔYl < ΔPl, ΔYm < ΔPm and ΔYm < ΔPm.
II. If L%<=R<=M%, make the following additional definitions:
δ2Yj = 0, if R21< r21;
(R21- r21)( Yj + Yk + Yl )Yj/
{(R21 - J%)Yj + (R21 - K%)Yk }, if R21=> r21 and L%>R21=>K%; and
(R21- r21)( Yj + Yk + Yl )/(R21 - J%), if R21=> r21 and K%>R21=>J%.
δ2Yk = 0, if R21< r21 and R21=>K%;
(R21- r21)( Yj + Yk + Yl )Yk/
{ (R21 - K%)Yk + (R21 - L%)Yl }, if R21< r21 and R21<K%;
(R21- r21)( Yj + Yk + Yl )Yk/
{(R21 - J%)Yj + (R21 - K%)Yk }, if R21=> r21 and L%>R21=>K%; and
0, if R21=> r21 and R21<K%.
δ2Yl = (R21- r21)( Yj + Yk + Yl )/(R21 - L%), if R21< r21 and K%<=R21<L%;
(R21- r21)( Yj + Yk + Yl )Yl/{ (R21 - K%)Yk + (R21 - L%)Yl }, if R21< r21 and R21<K%;
0, if R21=> r21.
δ2Ym = 0, if R22< r22;
(R22- r22)( Ym + Yn )/(R22 - M%), if R22=> r22 and R22=>M%;
δ2Yn = the greater of 0 and ΔPn - Zn, if R22=N%;
(R22- r22)( Ym + Yn)/(R22 - N%), if R22< r22 and M%<=R22<N%;
0, if R22=> r22 and R22<N%.
APPENDIX X-0
x0Xx, x0Xx, x0Xx, x0Xx and δ2Yn are numbers respectively between Yj, Yk, Yl, Ym and Yn and 0 such that:
{J%(Yj - δ2Yj ) + K%( Yk.- δ2Yk) + L%( Yl.- δ2Yl)}/
( Yj - δ2Yj + Yk.- δ2Yk + Yl.- δ2Yl)
= R21;
and
{ M%( Ym.- δ2Ym) + N%( Yn.- δ2Yn) }/
(Ym.- δ2Ym + Yn.- δ2Yn)
= R22.
Y21 = Yj - δ2Yj + Yk.- δ2Yk + Yl.- δ2Yl.
P21 = Pj + Pk + Pl.
Z21 = Zj + Zk + Zl.
ΔY21 = ΔYj - δ2Yj + ΔYk.- δ2Yk + ΔYl.- δ2Yl.
ΔP21 = ΔPj + ΔPk + ΔPl.
ΔZ21 = ΔZj + ΔZk + ΔZl.
Y22 = Ym.- δ2Ym + Yn.- δ2Yn.
P22 = Pm + Pn.
Z22 = Zm + Zn.
ΔY22 = ΔYm.- δ2Ym + ΔYn.- δ2Yn
ΔP22 = ΔPm + ΔPn.
ΔZ22 = ΔZm + ΔZn.
APPENDIX A-10
1. If Y22 - α(P22 - ΔP22) => 0, Y21- α(P21 - ΔP21) => 0, and γ2(P21 - ΔP21) < (P22 -
ΔP22), then ΔY22 = Y22 - αγ2(P21 - ΔP21) and ΔY21 = Y21 - α(P21 - ΔP21).
2. If Y22 - α(P22 - ΔP22) => 0, Y21 - α(P21 - ΔP21) => 0, and γ2(P21 - ΔP21) =>
(P22 - ΔP22), then ΔY22 = Y22 - α(P22 - ΔP22) and ΔY21 = Y21 - (α/γ2)(P22 - ΔP22).
3. If Y22 - α(P22 - ΔP22) < 0, Y21 - α(P21 - ΔP21) => 0, and Y21 - α(P21 - ΔP21) =>
Y21 - (Y22/γ2), then ΔY22 = Y22 - αγ2(P21 - ΔP21) and ΔY21 = Y21 - α(P21 - ΔP21).
4. If Y22 - α(P22 - ΔP22) < 0, Y21 - (Y22/γ2) => 0, and Y21 - α(P21 - ΔP21) <= Y21 - (Y22/γ2),
then ΔY22 = 0 and ΔY21 = Y21 - (Y22/γ2).
5. If Y21 - α(P21 - ΔP21) < 0, Y21 - (Y22/γ2) < 0, and Y22 - α(P22 - ΔP22) <= Y22 - (γ2Y21),
then ΔY22 = Y22 - (γ2Y21) and ΔY21 = 0.
6. If Y21 - α(P21 - ΔP21) < 0, Y22 - α(P22 - ΔP22) => 0, and Y22 - α(P22 - ΔP22) =>
Y22 - (γ2Y21), then ΔY22 = Y22 - α(P22 - ΔP22) and
ΔY21 = Y21 - (α/γ2)(P22 - ΔP22).
ΔYj = δ2Yj + [(Yj - δ2Yj )/Y21 ] ΔY21
ΔYk = δ2Yk + [(Yk - δ2Yk )/Y21 ] ΔY21
ΔYl = δ2Yl + [(Yl - δ2Yl )/Y21 ] ΔY21
ΔYm = δ2Ym + [(Ym - δ2Ym )/Y22 ] ΔY22
ΔYn = δ2Yn + [(Yn - δ2Yn )/Y22 ] ΔY22
The purpose of the foregoing definitional provisions together with the related provisions allocating Realized Losses and defining the
REMIC I Y and REMIC I Z Principal Distribution Amounts is to accomplish the following goals in the following order of priority:
1. Making the ratio of (Y22 - ΔY22 ) to (Y21 - ΔY21 ) equal to γ2 after taking account of the allocation Realized
Losses and the distributions that will be made through the end of the Distribution Date to which such provisions relate and
assuring that the Principal Reduction Amount for each of the REMIC I YAA, YBB, YCC, YDD, ZAA, ZBB, ZCC and ZDD Regular Interests
is greater than or equal to zero for such Distribution Date;
2. Making the REMIC I YAA Uncertificated Principal Balance less than or equal to 0.0005 of the sum of the REMIC I YAA and REMIC I
ZAA Uncertificated Principal Balances, the REMIC I YBB Uncertificated Principal Balance less than or equal to 0.0005 of the sum
of the REMIC I YBB and REMIC I ZBB Uncertificated Principal Balances, the REMIC I YCC Uncertificated Principal Balance less than
or equal to 0.0005 of the sum of the REMIC I YCC and REMIC I ZCC Uncertificated Principal Balances and the REMIC I YDD
Uncertificated Principal Balance less than or equal to 0.0005 of the sum of the REMIC I YDD and REMIC I ZDD Uncertificated
Principal Balances, in each case after giving effect to allocations of Realized Losses and distributions to be made through the
end of the Distribution Date to which such provisions relate; and
3. Making the larger of (a) the fraction whose numerator is (Y22 - ΔY22 ) and whose denominator is the sum of (Y22 -
ΔY22) and (Z22 - ΔZ22) and (b) the fraction whose numerator is (Y21 - ΔY21) and whose denominator is the sum of
(Y21 - ΔY21) and (Z21 - ΔZ21) as large as possible while remaining less than or equal to 0.0005.
APPENDIX A-11
In the event of a failure of the foregoing portion of the definition of REMIC I Principal Reduction Amount to accomplish both of
goals 1 and 2 above, the amounts thereof should be adjusted to so as to accomplish such goals within the requirement that
each REMIC I Y Principal Reduction Amount must be less than or equal to the sum of (a) the Principal Realized Losses to be
allocated on the related Distribution Date for the related Pool remaining after the allocation of such Realized Losses to
the related class of ratio-strip principal only certificates, if any, and (b) the remainder of the Available Distribution
Amount for the related Pool or after reduction thereof by the distributions to be made on such Distribution Date (i) to the
related class of ratio-strip principal only certificates, if any, (ii) to the related class of ratio-strip interest only
certificates, if any, and (iii) in respect of interest on the related REMIC I Y and REMIC I Z Regular Interests, or, if both
of such goals cannot be accomplished within such requirement, such adjustment as is necessary shall be made to accomplish
goal 1 within such requirement. In the event of any conflict among the provisions of the definition of the REMIC I Y
Principal Reduction Amounts, such conflict shall be resolved on the basis of the goals and their priorities set forth above
within the requirement set forth in the preceding sentence. If the formula allocations of ΔY21 among ΔYj,
ΔYk and ΔYl or ΔY22 among ΔYm and ΔYn cannot be achieved because one or more of ΔYj,
ΔYk, ΔYl, ΔYm and ΔYn, as so defined, is greater than the related one of ΔPj, ΔPk,
ΔPl, ΔPm and ΔPn, such an allocation shall be made as close as possible to the formula allocation within
the requirement that ΔYj < ΔPj, ΔYk < ΔPk, ΔYl < ΔPl, ΔYm < ΔPm and
ΔYn < ΔPn.
III. If K%<=R<=L%, make the following additional definitions:
δ3Yj = 0, if R31< r31; and
(R31- r31)( Yj + Yk )/(R31 - J%), if R31=> r31 and K%>R31=>J%.
δ3Yk = (R31- r31)( Yj + Yk )/(R31 - K%), if R31< r31 and R31<K%; and
0, if R31=> r31 and R31<K%.
δ3Yl = 0, if R32< r32;
(R32- r32)( Yl + Ym + Yn)Yl/
{ (R32 - L%)Yl + (R32 - M%)Ym }, if R32=> r32 and N%>R32=>M%;
(R32- r32)( Yl + Ym + Yn)/(R32 - L%), if R32=> r32 and M%>R32=>L%;
δ3Ym = 0, if R32< r32 and R32=>M%;
(R32- r32)( Yl + Ym + Yn)Ym/
{ (R32 - M%)Ym + (R32 - N%)Yn }, if R32< r32 and L%<=R32<M%;
(R32- r32)( Yl + Ym + Yn)Ym/
{ (R32 - L%)Yl + (R32 - M%)Ym }, if R32=> r32 and N%>R32=>M%;
0, if R32=> r32 and R32<M%.
δ3Yn = 0, if R32< r32 and R32=>N%;
(R32- r32)( Yl + Ym + Yn)/(R32 - N%), if R32< r32 and M%<=R32<N%;
(R32- r32)( Yl + Ym + Yn )Yn/
{ (R32 - M%)Ym + (R32 - N%)Yn }, if R32< r32 and L%<=R32<M%;
APPENDIX A-12
0, if R32=> r32 and R32<N%.
δ3Yj, x0Xx, x0Xx, x0Xx and δ3Yn are numbers respectively between Yj, Yk, Yl, Ym, and Yn and 0 such
that:
{J%(Yj - δ3Yj ) + K%( Yk.- δ3Yk) }/
( Yj - δ3Yj + Yk.- δ3Yk)
= R31;
and
{ L%( Yl.- δ3Yl) + M%( Ym.- δ3Ym) + N%( Yn.- δ3Yn ) }/
(Yl.- δ3Yl + Ym.- δ3Ym + Yn.- δ3Yn )
= R32.
Y31 = Yj - δ3Yj + Yk.- δ3Yk.
P31 = Pj + Pk.
Z31 = Zj + Zk.
ΔY31 = ΔYj - δ3Yj + ΔYk.- δ3Yk.
ΔP31 = ΔPj + ΔPk.
ΔZ31 = ΔZj + ΔZk.
Y32 = Yl.- δ3Yl + Ym.- δ3Ym + Yn.- δ3Yn .
P32 = Pl + Pm + Pn .
Z32 = Zl + Zm + Zn.
ΔY32 = ΔYl.- δ3Yl + ΔYm.- δ3Ym + ΔYn.- δ3Yn .
ΔP32 = ΔPl + ΔPm + ΔPn.
ΔZ32 = ΔZl + ΔZm + ΔZn.
APPENDIX A-13
1. If Y32 - α(P32 - ΔP32) => 0, Y31- α(P31 - ΔP31) => 0, and γ3(P31 - ΔP31) < (P32 -
ΔP32), then ΔY32 = Y32 - αγ3(P31 - ΔP31) and ΔY31 = Y31 - α(P31 - ΔP31).
2. If Y32 - α(P32 - ΔP32) => 0, Y31 - α(P31 - ΔP31) => 0, and γ3(P31 - ΔP31) =>
(P32 - ΔP32), then ΔY32 = Y32 - α(P32 - ΔP32) and ΔY31 = Y31 - (α/γ3)(P32 - ΔP32).
3. If Y32 - α(P32 - ΔP32) < 0, Y31 - α(P31 - ΔP31) => 0, and Y31 - α(P31 - ΔP31) =>
Y31 - (Y32/γ3), then ΔY32 = Y32 - αγ3(P31 - ΔP31) and ΔY31 = Y31 - α(P31 - ΔP31).
4. If Y32 - α(P32 - ΔP32) < 0, Y31 - (Y32/γ3) => 0, and Y31 - α(P31 - ΔP31) <= Y31 - (Y32/γ3),
then ΔY32 = 0 and ΔY31 = Y31 - (Y32/γ3).
5. If Y31 - α(P31 - ΔP31) < 0, Y31 - (Y32/γ3) < 0, and Y32 - α(P32 - ΔP32) <= Y32 - (γ3Y31),
then ΔY32 = Y32 - (γ3Y31) and ΔY31 = 0.
6. If Y31 - α(P31 - ΔP31) < 0, Y32 - α(P32 - ΔP32) => 0, and Y32 - α(P32 - ΔP32) =>
Y32 - (γ3Y31), then ΔY32 = Y32 - α(P32 - ΔP32) and
ΔY31 = Y31 - (α/γ3)(P32 - ΔP32).
ΔYj = δ3Yj + [(Yj - δ3Yj )/Y31 ] ΔY31
ΔYk = δ3Yk + [(Yk - δ3Yk )/Y31 ] ΔY31
ΔYl = δ3Yl + [(Yl - δ3Yl )/Y32 ] ΔY32
ΔYm = δ3Ym + [(Ym - δ3Ym )/Y32 ] ΔY32
ΔYn = δ3Yn + [(Yn - δ3Yn )/Y32 ] ΔY32
The purpose of the foregoing definitional provisions together with the related provisions allocating Realized Losses and defining the
REMIC I Y and REMIC I Z Principal Distribution Amounts is to accomplish the following goals in the following order of priority:
1. Making the ratio of (Y32 - ΔY32 ) to (Y31 - ΔY31 ) equal to γ3 after taking account of the allocation
Realized Losses and the distributions that will be made through the end of the Distribution Date to which such provisions
relate and assuring that the Principal Reduction Amount for each of the REMIC I YAA, YBB, YCC, YDD, ZAA, ZBB, ZCC and ZDD
Regular Interests is greater than or equal to zero for such Distribution Date;
2. Making the REMIC I YAA Uncertificated Principal Balance less than or equal to 0.0005 of the sum of the REMIC I YAA and REMIC
I ZAA Uncertificated Principal Balances, the REMIC I YBB Uncertificated Principal Balance less than or equal to 0.0005 of
the sum of the REMIC I YBB and REMIC I ZBB Uncertificated Principal Balances, the REMIC I YCC Uncertificated Principal
Balance less than or equal to 0.0005 of the sum of the REMIC I YCC and REMIC I ZCC Uncertificated Principal Balances and the
REMIC I YDD Uncertificated Principal Balance less than or equal to 0.0005 of the sum of the REMIC I YDD and REMIC I ZDD
Uncertificated Principal Balances, in each case after giving effect to allocations of Realized Losses and distributions to
be made through the end of the Distribution Date to which such provisions relate; and
3. Making the larger of (a) the fraction whose numerator is (Y32 - ΔY32 ) and whose denominator is the sum of (Y32 -
ΔY32) and (Z32 - ΔZ32) and (b) the fraction whose numerator is (Y31 - ΔY31) and whose denominator is the
sum of (Y31 - ΔY31) and (Z31 - ΔZ31) as large as possible while remaining less than or equal to 0.0005.
APPENDIX A-14
In the event of a failure of the foregoing portion of the definition of REMIC I Principal Reduction Amount to accomplish both of
goals 1 and 2 above, the amounts thereof should be adjusted to so as to accomplish such goals within the requirement that each REMIC
I Y Principal Reduction Amount must be less than or equal to the sum of (a) the Principal Realized Losses to be allocated on the
related Distribution Date for the related Pool remaining after the allocation of such Realized Losses to the related class of
ratio-strip principal only certificates, if any, and (b) the remainder of the Available Distribution Amount for the related Pool or
after reduction thereof by the distributions to be made on such Distribution Date (i) to the related class of ratio-strip principal
only certificates, if any, (ii) to the related class of ratio-strip interest only certificates, if any, and (iii) in respect of
interest on the related REMIC I Y and REMIC I Z Regular Interests, or, if both of such goals cannot be accomplished within such
requirement, such adjustment as is necessary shall be made to accomplish goal 1 within such requirement. In the event of any
conflict among the provisions of the definition of the REMIC I Y Principal Reduction Amounts, such conflict shall be resolved on the
basis of the goals and their priorities set forth above within the requirement set forth in the preceding sentence. If the formula
allocations of ΔY31 among ΔYj and ΔYk or ΔY32 among ΔYl, ΔYm and ΔYn cannot be achieved
because one or more of ΔYj, ΔYk, ΔYl, ΔYm and ΔYn, as so defined, is greater than the related one of
ΔPj, ΔPk, ΔPl, ΔPm and ΔPn, such an allocation shall be made as close as possible to the formula
allocation within the requirement that ΔYj < ΔPj, ΔYk < ΔPk, ΔYl < ΔPl, ΔYm < ΔPm and
ΔYn < ΔPn.
IV. If R<=K%, make the following additional definitions:
δ4Yk = 0, if R42< r42;
(R42- r42)( Yk + Yl + Ym + Yn )Yk/
{ (R42 - K%)Yk + (R42 - L%)Yl + (R42 - M%)Ym }, if R42=> r42 and N%>R42=>M%;
(R42- r42)( Yk + Yl + Ym + Yn )Yk/
{ (R42 - K%)Yk + (R42 - L%)Yl }, if R42=> r42 and M%>R42=>L%; and
(R42- r42)( Yk + Yl + Ym + Yn )/(R42 - K%), if R42=> r42 and L%>R42=>K%.
δ4Yl = 0, if R42< r42 and R42=>L%;
(R42- r42)( Yk + Yl + Ym + Yn )Yl/
{ (R42 - L%)Yl + (R42 - M%)Ym +
(R42 - N%)Yn }, if R42< r42 and L%>R42=>K%;
(R42- r42)( Yk + Yl + Ym + Yn )Yl/
{ (R42 - K%)Yk + (R42 - L%)Yl + (R42 - M%)Ym }, if R42=> r42 and N%>R42=>M%;
(R42- r42)( Yk + Yl + Ym + Yn )Yl/
{ (R42 - K%)Yk + (R42 - L%)Yl }, if R42=> r42 and M%>R42=>L%;
0, if R42=> r42 and R42<L%.
δ4Ym = 0, if R42< r42 and R42=>M%;
(R42- r42)( Yk + Yl + Ym + Yn )Ym/
{ (R42 - M%)Ym + (R42 - N%)Yn }, if R42< r42 and L%<=R42<M%;
(R42- r42)( Yk + Yl + Ym + Yn )Ym/
{ (R42 - L%)Yl + (R42 - M%)Ym + (R42 - N%)Yn }, if R42< r42 and K<=R42<L%;
APPENDIX A-15
(R42- r42)( Yk + Yl + Ym + Yn )Ym/
{ (R42 - K%)Yk + (R42 - L%)Yl + (R42 - M%)Ym }, if R42=> r42 and N%>R42=>M%;
0, if R42=> r42 and R42<M%.
δ4Yn = 0, if R42< r42 and R42=>N%;
(R42- r42)( Yk + Yl + Ym + Yn )/ (R42 - N%), if R42< r42 and M%<=R42<N%;
(R42- r42)( Yk + Yl + Ym + Yn )Yn/
{ (R42 - M%)Ym + (R42 - N%)Yn }, if R42< r42 and L%<=R42<M%;
(R42- r42)( Yk + Yl + Ym + Yn )Yn/
{ (R42 - L%)Yl + (R42 - M%)Ym + (R42 - N%)Yn }, if R42< r42 and K%<=R42<L%;
0, if R42=> r42 and R42<N%.
x0Xx, x0Xx, x0Xx and δ4Yn are numbers respectively between Yk, Yl, Ym and Yn and 0 such that
{ K%( Yk.- δ4Yk) + L%( Yl.- δ4Yl) + M%( Ym.- δ4Ym) + N%( Yn.- δ4Yn) }/
( Yk.- δ4Yk + Yl.- δ4Yl + Ym.- δ4Ym + Yn.- δ4Yn )
= R42.
Y42 = Yk.- δ4Yk + Yl.- δ4Yl + Ym.- δ4Ym + Yn.- δ4Yn .
P42 = Pk + Pl + Pm + Pn.
Z42 = Zk + Zl + Zm + Zn.
ΔY42 = ΔYk.- δ4Yk + ΔYl.- δ4Yl + ΔYm.- δ4Ym + ΔYn.- δ4Yn .
APPENDIX A-16
ΔP42 = ΔPk + ΔPl + ΔPm + ΔPn.
ΔZ42 = ΔZk + ΔZl + ΔZm + ΔZn.
1. If Y42 - α(P42 - ΔP42) => 0, Yj- α(Pj - ΔPj) => 0, and γ4(Pj - ΔPj) < (P42 - ΔP42),
then ΔY42 = Y42 - αγ4(Pj - ΔPj) and ΔYj = Yj - α(Pj - ΔPj).
2. If Y42 - α(P42 - ΔP42) => 0, Yj - α(Pj - ΔPj) => 0, and γ4(Pj - ΔPj) => (P42 - ΔP42),
then ΔY42 = Y42 - α(P42 - ΔP42) and ΔYj = Yj - (α/γ4)(P42 - ΔP42).
3. If Y42 - α(P42 - ΔP42) < 0, Yj - α(Pj - ΔPj) => 0, and Yj - α(Pj - ΔPj) =>
Yj - (Y42/γ4), then ΔY42 = Y42 - αγ4(Pj - ΔPj) and ΔYj = Yj - α(Pj - ΔPj).
4. If Y42 - α(P42 - ΔP42) < 0, Yj - (Y42/γ4) => 0, and Yj - α(Pj - ΔPj) <= Yj - (Y42/γ4), then
ΔY42 = 0 and ΔYj = Yj - (Y42/γ4).
5. If Yj - α(Pj - ΔPj) < 0, Yj - (Y42/γ4) < 0, and Y42 - α(P42 - ΔP42) <= Y42 - (γ4Yj), then
ΔY42 = Y42 - (γ4Yj) and ΔYj = 0.
6. If Yj - α(Pj - ΔPj) < 0, Y42 - α(P42 - ΔP42) => 0, and Y42 - α(P42 - ΔP42) =>
Y42 - (γ4Yj), then ΔY42 = Y42 - α(P42 - ΔP42) and ΔYj = Yj - (α/γ4)(P42 - ΔP42).
ΔYk = δ4Yk + [(Yk - δ4Yk )/Y42 ] ΔY42
ΔYl = δ4Yl + [(Yl - δ4Yl )/Y42 ] ΔY42
ΔYm = δ4Ym + [(Ym - δ4Ym )/Y42 ] ΔY42
ΔYn = δ4Yn + [(Yn - δ4Yn )/Y42 ] ΔY42
The purpose of the foregoing definitional provisions together with the related provisions allocating Realized Losses and defining the
REMIC I Y and REMIC I Z Principal Distribution Amounts is to accomplish the following goals in the following order of priority:
1. Making the ratio of (Y42 - ΔY42 ) to (Yj - ΔYj ) equal to γ4 after taking account of the allocation Realized
Losses and the distributions that will be made through the end of the Distribution Date to which such provisions relate and
assuring that the Principal Reduction Amount for each of the REMIC I YAA, YBB, YCC, YDD, ZAA, ZBB, ZCC and ZDD Regular Interests
is greater than or equal to zero for such Distribution Date;
2. Making the REMIC I YAA Uncertificated Principal Balance less than or equal to 0.0005 of the sum of the REMIC I YAA and REMIC I
ZAA Uncertificated Principal Balances, the REMIC I YBB Uncertificated Principal Balance less than or equal to 0.0005 of the sum
of the REMIC I YBB and REMIC I ZBB Uncertificated Principal Balances, the REMIC I YCC Uncertificated Principal Balance less than
or equal to 0.0005 of the sum of the REMIC I YCC and REMIC I ZCC Uncertificated Principal Balances and the REMIC I YDD
Uncertificated Principal Balance less than or equal to 0.0005 of the sum of the REMIC I YDD and REMIC I ZDD Uncertificated
Principal Balances, in each case, after giving effect to allocations of Realized Losses and distributions to be made through the
end of the Distribution Date to which such provisions relate; and
APPENDIX A-17
3. Making the larger of (a) the fraction whose numerator is (Y42 - ΔY42 ) and whose denominator is the sum of (Y42 -
ΔY42) and (Z42 - ΔZ42) and (b) the fraction whose numerator is (Yj - ΔYj) and whose denominator is the sum of
(Yj - ΔYj) and (Zj - ΔZj) as large as possible while remaining less than or equal to 0.0005.
In the event of a failure of the foregoing portion of the definition of REMIC I Y Principal Reduction Amount to accomplish both of
goals 1 and 2 above, the amounts thereof should be adjusted to so as to accomplish such goals within the requirement that each REMIC
I Y Principal Reduction Amount must be less than or equal to the sum of (a) the Principal Realized Losses to be allocated on the
related Distribution Date for the related Pool remaining after the allocation of such Realized Losses to the related class of
ratio-strip principal only certificates, if any, and (b) the remainder of the Available Distribution Amount for the related Pool or
after reduction thereof by the distributions to be made on such Distribution Date (i) to the related class of ratio-strip principal
only certificates, if any, (ii) to the related class of ratio-strip interest only certificates, if any, and (iii) in respect of
interest on the related REMIC I Y and REMIC I Z Regular Interests, or, if both of such goals cannot be accomplished within such
requirement, such adjustment as is necessary shall be made to accomplish goal 1 within such requirement. In the event of any
conflict among the provisions of the definition of the REMIC I Y Principal Reduction Amounts, such conflict shall be resolved on the
basis of the goals and their priorities set forth above within the requirement set forth in the preceding sentence. If the formula
allocation of ΔY42 among ΔYk, ΔYl, ΔYm and ΔYn cannot be achieved because one or more of ΔYk,
ΔYl, ΔYm and ΔYn, as so defined, is greater than the related one of ΔPk, ΔPl, ΔPm and ΔPn,
such an allocation shall be made as close as possible to the formula allocation within the requirement that ΔYk < ΔPk,
ΔYl < ΔPl, ΔYm < ΔPm and ΔYn < ΔPn.
NOTES:
1. REMIC I YAA and ZAA Regular Interests are related to Loan Group AA. The sum of the Uncertificated Principal Balances for
the REMIC I YAA and ZAA Regular Interests is equal to the aggregate stated principal balance of the Mortgage Loans in Loan Group AA.
REMIC I YBB and ZBB Regular Interests are related to Loan Group BB. The sum of the Uncertificated Principal Balances for the REMIC I
YBB and REMIC I ZBB Regular Interests is equal to the aggregate stated principal balance of the Mortgage Loans in Loan Group BB.
REMIC I YCC and ZCC Regular Interests are related to Loan Group CC. The sum of the Uncertificated Principal Balances for the REMIC
I YCC and ZCC Regular Interests is equal to the aggregate stated principal balance of the Mortgage Loans in Loan Group CC. REMIC I
YDD and ZDD Regular Interests are related to Loan Group DD. The sum of the Uncertificated Principal Balances for the REMIC I YDD and
ZDD Regular Interests is equal to the aggregate stated principal balance of the Mortgage Loans in Loan Group DD. The REMIC I Y and Z
Regular Interests will be principal and interest classes bearing interest at the pass-through rate for the related Loan Group.
2. The Class CB pass-through rate is the weighted average of the pass-through rates on the REMIC I YAA, YBB, YCC, and YDD
Regular Interests.
APPENDIX A-18
