EXECUTION COPY
RESIDENTIAL ASSET SECURITIES CORPORATION,
Depositor,
RESIDENTIAL FUNDING CORPORATION,
Master Servicer,
and
U.S. BANK NATIONAL ASSOCIATION
Trustee
POOLING AND SERVICING AGREEMENT
Dated as of September 1, 2006
Home Equity Mortgage Asset-Backed Pass-Through Certificates
Series 2006-EMX8
TABLE OF CONTENTS
(continued)
PAGE
-iv-
TABLE OF CONTENTS
PAGE
-i-
ARTICLE I
DEFINITIONS............................................................................................4
Section 1.01.
Definitions.......................................................................4
Section 1.02.
Determination of
LIBOR...........................................................56
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; ORIGINAL ISSUANCE OF
CERTIFICATES......................................58
Section 2.01.
Conveyance of Mortgage
Loans.....................................................58
Section 2.02.
Acceptance by
Trustee............................................................61
Section 2.03.
Representations, Warranties and Covenants of the Master Servicer
and the
Depositor........................................................................62
Section 2.04.
Representations and Warranties of
Sellers........................................64
Section 2.05.
Execution and Authentication of Certificates; Conveyance of REMIC-I
Regular
Interests................................................................66
Section 2.06.
Purposes and Powers of the
Trust.................................................66
Section 2.07.
Agreement Regarding Ability to
Disclose..........................................67
ARTICLE III ADMINISTRATION AND SERVICING OF MORTGAGE
LOANS......................................................68
Section 3.01.
Master Servicer to Act as
Servicer...............................................68
Section 3.02.
Subservicing Agreements Between Master Servicer and Subservicers;
Enforcement of Subservicers'
Obligations.........................................70
Section 3.03.
Successor
Subservicers...........................................................71
Section 3.04.
Liability of the Master
Servicer.................................................71
Section 3.05.
No Contractual Relationship Between Subservicer and Trustee or
Certificateholders...............................................................72
Section 3.06.
Assumption or Termination of Subservicing Agreements by
Trustee..................72
Section 3.07.
Collection of Certain Mortgage Loan Payments; Deposits to Custodial
Account..........................................................................72
Section 3.08.
Subservicing Accounts; Servicing
Accounts........................................75
Section 3.09.
Access to Certain Documentation and Information Regarding the
Mortgage
Loans............................................................................76
Section 3.10.
Permitted Withdrawals from the Custodial
Account.................................76
Section 3.11.
Maintenance of Primary Insurance
Coverage........................................78
Section 3.12.
Maintenance of Fire Insurance and Omissions and Fidelity
Coverage................78
Section 3.13.
Enforcement of Due-on-Sale Clauses; Assumption and Modification
Agreements; Certain
Assignments..................................................79
Section 3.14.
Realization Upon Defaulted Mortgage
Loans........................................81
Section 3.15.
Trustee to Cooperate; Release of Custodial
Files.................................83
Section 3.16.
Servicing and Other Compensation; Compensating
Interest..........................84
Section 3.17.
Reports to the Trustee and the
Depositor.........................................85
Section 3.18.
Annual Statement as to Compliance and Servicing
Assessment.......................86
Section 3.19.
Annual Independent Public Accountants' Servicing
Report..........................86
Section 3.20.
Right of the Depositor in Respect of the Master
Servicer.........................86
Section 3.21.
[Reserved].......................................................................87
Section 3.22.
Advance
Facility.................................................................87
ARTICLE IV PAYMENTS TO
CERTIFICATEHOLDERS.......................................................................91
Section 4.01.
Certificate
Account..............................................................91
Section 4.02.
Distributions....................................................................91
Section 4.03.
Statements to Certificateholders; Statements to Rating Agencies;
Exchange
Act
Reporting....................................................................95
Section 4.04.
Distribution of Reports to the Trustee and the Depositor; Advances
by the
Master
Servicer..................................................................99
Section 4.05.
Allocation of Realized
Losses...................................................100
Section 4.06.
Reports of Foreclosures and Abandonment of Mortgaged
Property...................102
Section 4.07.
Optional Purchase of Defaulted Mortgage
Loans...................................102
Section 4.08.
Limited Mortgage Loan Repurchase
Right..........................................102
Section 4.09.
Derivative
Contracts............................................................103
Section 4.10.
Yield Maintenance
Agreement.....................................................103
ARTICLE V THE
CERTIFICATES.....................................................................................105
Section 5.01.
The
Certificates................................................................105
Section 5.02.
Registration of Transfer and Exchange of
Certificates...........................107
Section 5.03.
Mutilated, Destroyed, Lost or Stolen
Certificates...............................111
Section 5.04.
Persons Deemed
Owners...........................................................111
Section 5.05.
Appointment of Paying
Agent.....................................................112
ARTICLE VI THE DEPOSITOR AND THE MASTER
SERVICER...............................................................113
Section 6.01.
Respective Liabilities of the Depositor and the Master
Servicer.................113
Section 6.02.
Merger or Consolidation of the Depositor or the Master Servicer;
Assignment of Rights and Delegation of Duties by Master
Servicer................113
Section 6.03.
Limitation on Liability of the Depositor, the Master Servicer and
Others........114
Section 6.04.
Depositor and Master Servicer Not to
Resign.....................................114
ARTICLE VII
DEFAULT............................................................................................116
Section 7.01.
Events of
Default...............................................................116
Section 7.02.
Trustee or Depositor to Act; Appointment of
Successor...........................117
Section 7.03.
Notification to
Certificateholders..............................................118
Section 7.04.
Waiver of Events of
Default.....................................................119
ARTICLE VIII CONCERNING THE
TRUSTEE............................................................................120
Section 8.01.
Duties of
Trustee...............................................................120
Section 8.02.
Certain Matters Affecting the
Trustee...........................................121
Section 8.03.
Trustee Not Liable for Certificates or Mortgage
Loans...........................122
Section 8.04.
Trustee May Own
Certificates....................................................123
Section 8.05.
Master Servicer to Pay Trustee's Fees and Expenses;
Indemnification.............123
Section 8.06.
Eligibility Requirements for
Trustee............................................123
Section 8.07.
Resignation and Removal of the
Trustee..........................................124
Section 8.08.
Successor
Trustee...............................................................125
Section 8.09.
Merger or Consolidation of
Trustee..............................................125
Section 8.10.
Appointment of Co-Trustee or Separate
Trustee...................................125
Section 8.11.
Appointment of the
Custodian....................................................126
Section 8.12.
Appointment of Office or
Agency.................................................127
Section 8.13.
DTC Letter of
Representations...................................................127
Section 8.14.
Yield Maintenance
Agreement.....................................................127
ARTICLE IX
TERMINATION.........................................................................................128
Section 9.01.
Termination Upon Purchase or Liquidation of All Mortgage
Loans..................128
Section 9.02.
Additional Termination
Requirements.............................................131
ARTICLE X REMIC
PROVISIONS.....................................................................................133
Section 10.01.
REMIC
Administration............................................................133
Section 10.02.
Master Servicer, REMIC Administrator and Trustee
Indemnification................136
ARTICLE XI MISCELLANEOUS
PROVISIONS............................................................................137
Section 11.01.
Amendment.......................................................................137
Section 11.02.
Recordation of Agreement;
Counterparts..........................................139
Section 11.03.
Limitation on Rights of
Certificateholders......................................139
Section 11.04.
Governing
Law...................................................................140
Section 11.05.
Notices.........................................................................140
Section 11.06.
Notices to Rating
Agencies......................................................141
Section 11.07.
Severability of
Provisions......................................................141
Section 11.08.
Supplemental Provisions for
Resecuritization....................................141
Section 11.09.
Third-Party
Beneficiary.........................................................142
ARTICLE XII COMPLIANCE WITH REGULATION
AB......................................................................142
Section 12.01.
Intent of Parties;
Reasonableness...............................................142
Section 12.02.
Additional Representations and Warranties of the
Trustee........................143
Section 12.03.
Information to be Provided by the
Trustee.......................................143
Section 12.04.
Report on Assessment of Compliance and
Attestation..............................144
Section 12.05.
Indemnification;
Remedies.......................................................144
EXHIBIT A
FORM OF CLASS A
CERTIFICATE..................................................................A-1
EXHIBIT B
FORM OF CLASS M
CERTIFICATE..................................................................B-1
EXHIBIT C
FORM OF CLASS SB
CERTIFICATE.................................................................C-1
EXHIBIT D
FORM OF CLASS R
CERTIFICATE..................................................................D-1
EXHIBIT E
FORM OF CUSTODIAL
AGREEMENT..................................................................E-1
EXHIBIT F-1
GROUP I LOAN
SCHEDULE........................................................................F-1
EXHIBIT F-2
GROUP II LOAN
SCHEDULE.......................................................................F-2
EXHIBIT G
FORM OF REQUEST FOR
RELEASE..................................................................G-1
EXHIBIT H-1
FORM OF TRANSFER AFFIDAVIT AND
AGREEMENT...................................................H-1-1
EXHIBIT H-2
FORM OF TRANSFEROR
CERTIFICATE.............................................................H-2-1
EXHIBIT I
FORM OF INVESTOR REPRESENTATION
LETTER.......................................................I-1
EXHIBIT J
FORM OF TRANSFEROR REPRESENTATION
LETTER.....................................................J-1
EXHIBIT K
TEXT OF AMENDMENT TO POOLING AND SERVICING AGREEMENT PURSUANT TO
SECTION 11.01(E)
FOR A LIMITED
GUARANTY.......................................................................K-1
EXHIBIT L
FORM OF LIMITED
GUARANTY.....................................................................L-1
EXHIBIT M
FORM OF LENDER CERTIFICATION FOR ASSIGNMENT OF MORTGAGE
LOAN.................................M-1
EXHIBIT N
FORM OF RULE 144A INVESTMENT
REPRESENTATION..................................................N-1
EXHIBIT O
[RESERVED]...................................................................................O-1
EXHIBIT P
FORM OF ERISA
LETTER.........................................................................P-1
EXHIBIT Q
[RESERVED]...................................................................................Q-1
EXHIBIT R
ASSIGNMENT
AGREEMENT........................................................................R-1
EXHIBIT S
SERVICING
CRITERIA...........................................................................S-1
EXHIBIT T-1
FORM OF 10-K
CERTIFICATION.................................................................T-1-1
EXHIBIT T-2
FORM OF BACK-UP
CERTIFICATION..............................................................T-2-1
EXHIBIT U
INFORMATION TO BE PROVIDED BY THE MASTER SERVICER TO THE RATING
AGENCIES RELATING
TO REPORTABLE MODIFIED MORTGAGE
LOANS........................................................U-1
This
Pooling and
Servicing
Agreement,
effective
as of
September
1, 2006,
among
RESIDENTIAL
ASSET
SECURITIES
CORPORATION,
as the depositor (together with its permitted
successors and assigns,
the "Depositor"),
RESIDENTIAL
FUNDING
CORPORATION,
as master
servicer
(together with its permitted
successors and assigns,
the
"Master
Servicer"),
and U.S. BANK NATIONAL
ASSOCIATION,
a banking
association
organized under the laws of the
United States, as trustee (together with its permitted successors
and assigns, the "Trustee").
PRELIMINARY STATEMENT:
The
Depositor
intends
to
sell
mortgage
asset-backed
pass-through
certificates
(collectively,
the
"Certificates"),
to be issued
hereunder
in sixteen
Classes,
which in the
aggregate
will
evidence the entire
beneficial ownership interest in the Mortgage Loans (as defined
herein) and certain other related assets.
REMIC I
As provided herein,
the REMIC
Administrator will make an election to treat the segregated pool of
assets
consisting of the Mortgage Loans and certain other related assets
(exclusive of the Yield
Maintenance
Agreement)
subject to this
Agreement
as a real
estate
mortgage
investment
conduit
(a "REMIC")
for
federal
income tax
purposes,
and such
segregated
pool of
assets
will be
designated
as
"REMIC I."
Component
I of the
Class R
Certificates
will
represent
the sole
Class of
"residual
interests"
in
REMIC I
for
purposes
of the
REMIC
Provisions
(as defined
herein)
under
federal
income tax law. The following
table
irrevocably
sets forth the
designation,
remittance
rate
(the
"Uncertificated
REMIC I
Pass-Through
Rate")
and
initial
Uncertificated
Principal Balance for each of the "regular
interests" in REMIC I
(the "REMIC I Regular
Interests").
The "latest
possible
maturity
date"
(determined
solely
for
purposes
of
satisfying
Treasury
Regulation
Section 1.860G-1(a)(4)(iii))
for each REMIC I
Regular
Interest shall be the Maturity
Date.
None of the REMIC I
Regular Interests will be certificated.
UNCERTIFICATED REMIC I
INITIAL UNCERTIFICATED REMIC I
LATEST POSSIBLE
DESIGNATION
PASS-THROUGH RATE
PRINCIPAL BALANCE
MATURITY DATE
Y-1
Variable(1)
$
209,717.93
October 25, 2036
Y-2
Variable(1)
$
155,279.07
October 25, 2036
Z-1
Variable(1)
$ 419,226,149.00
October 25, 2036
Z-2
Variable(1)
$ 310,408,909.08
October 25, 2036
_______________
(1)
Calculated as provided in the definition of Uncertificated REMIC I
Pass-Through Rate.
REMIC II
As provided herein,
the REMIC
Administrator will make an election to treat the segregated pool of
assets
consisting of the REMIC I
Regular
Interests as a REMIC for federal income tax purposes,
and such segregated pool
of assets will be
designated
as
"REMIC II."
Component II of the Class R
Certificates
will
represent the sole
Class of "residual
interests" in REMIC II for purposes of the REMIC
Provisions (as defined
herein) under federal
income tax law. The following table
irrevocably sets forth the designation,
remittance rate (the
"Uncertificated
REMIC II
Pass-Through Rate") and initial
Uncertificated
Principal Balance for each of the "regular interests" in
REMIC II (the "REMIC II Regular
Interests").
The "latest possible maturity date" (determined
solely for purposes
of satisfying
Treasury
Regulation
Section 1.860G-1(a)(4)(iii))
for each REMIC II
Regular Interest shall be the
Maturity Date.
None of the REMIC II Regular Interests will be certificated.
UNCERTIFICATED REMIC I
INITIAL UNCERTIFICATED REMIC I
LATEST POSSIBLE
DESIGNATION
PASS-THROUGH RATE
PRINCIPAL BALANCE
MATURITY DATE
LT-1
Variable(1)
$
492,899,427.95
October 25, 2036
LT-2
Variable(1)
$
13,729.61
October 25, 2036
LT-3
0.00%
$
35,589.79
October 25, 2036
LT-4
Variable(1)
$
35,589.79
October 25, 2036
LT-5
Variable(1)
$
310,355,575.74
October 25, 2036
LT-6
Variable(1)
$
8,779.50
October 25, 2036
LT-7
0.00%
$
22,276.92
October 25, 2036
LT-8
Variable(1)
$
22,276.92
October 25, 2036
LT-Y1(2)
Variable(1)
$
209,717.93
October 25, 2036
LT-Y2(2)
Variable(1)
$
155,279.07
October 25, 2036
_______________
(1)
Calculated as provided in the definition of Uncertificated REMIC II
Pass-Through Rate.
(2)
LT-Y1 will have the same interest
rate,
principal
balance,
Principal
Reduction
Amount and
allocation of
Realized Losses as the REMIC I
Regular
Interest Y-1. LT-Y2 will have the same interest rate,
principal
balance,
Principal Reduction Amount and allocation of Realized Losses as the
REMIC I Regular Interest Y-2.
REMIC III
As provided herein,
the REMIC
Administrator will elect to treat the segregated pool of assets
consisting
of the REMIC II
Regular
Interests as a REMIC for federal income tax purposes,
and such segregated pool of assets
will be
designated as
"REMIC III."
Component III of the Class R
Certificates
will
represent the sole Class of
"residual
interests"
in
REMIC III
for
purposes
of the REMIC
Provisions
under
federal
income tax law.
The
following
table
irrevocably
sets
forth
the
designation,
Pass-Through
Rate,
aggregate
Initial
Certificate
Principal
Balance,
certain
features,
month of Final
Scheduled
Distribution
Date and initial ratings for each
Class of
Certificates
comprising
the
interests
representing
"regular
interests"
in
REMIC III.
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
Interests shall be the Maturity Date.
MONTH OF
FINAL
AGGREGATE INITIAL
SCHEDULED
PASS-THROUGH
CERTIFICATE
DISTRIBUTION
DESIGNATION
TYPE
RATE
PRINCIPAL BALANCE
FEATURES
DATE
RATINGS
S&P
Moody's
Class A-I-1
Regular(1)
Adjustable(2)(3)$
152,460,000.00
Senior/Adjustable
May 2030
AAA
Aaa
Rate
Class A-I-2
Regular(1)
Adjustable(2)(3)$
68,628,000.00
Senior/Adjustable
April 2035
AAA
Aaa
Rate
Class A-I-3
Regular(1)
Adjustable(2)(3)$
73,325,000.00
Senior/Adjustable
August 2036
AAA
Aaa
Rate
Class A-I-4
Regular(1)
Adjustable(2)(3)$
25,406,000.00
Senior/Adjustable
October 2036
AAA
Aaa
Rate
Class A-II
Regular(1)
Adjustable
$
236,806,000.00
Senior/Adjustable
October 2036
AAA
Aaa
(2)(3)
Rate
Class M-1
Regular(1)
Adjustable(2)(3)$
30,660,000.00
Mezzanine/Adjustable
October 2036
AA+
Aa1
Rate
Class M-2
Regular(1)
Adjustable(2)(3)$
26,645,000.00
Mezzanine/Adjustable
October 2036
AA
Aa2
Rate
Class M-3
Regular(1)
Adjustable(2)(3)$
16,060,000.00
Mezzanine/Adjustable
October 2036
AA-
Aa3
Rate
Class M-4
Regular(1)
Adjustable(2)(3)$
14,235,000.00
Mezzanine/Adjustable
October 2036
A+
A1
Rate
Class M-5
Regular(1)
Adjustable(2)(3)$
13,870,000.00
Mezzanine/Adjustable
October 2036
A
A2
Rate
Class M-6
Regular(1)
Adjustable(2)(3)$
12,045,000.00
Mezzanine/Adjustable
October 2036
A-
A3
Rate
Class M-7
Regular(1)
Adjustable(2)(3)$
10,220,000.00
Mezzanine/Adjustable
October 2036
BBB+
Baa1
Rate
Class M-8
Regular(1)
Adjustable(2)(3)$
Mezzanine/Adjustable
October 2036
BBB
Baa2
7,665,000.00
Rate
Class M-9
Regular(1)
Adjustable(2)(3)$
10,585,000.00
Mezzanine/Adjustable
October 2036
BBB-
Baa3
Rate
Class SB
Regular
(4)
$
31,390,055.08
Subordinate
N/A
N/A
N/A
(4)
_______________
(1)
The
Class A-I,
Class A-II
and Class M
Certificates
will
represent
ownership
of
REMIC III
Regular
Interests
together
with
certain
rights
to
payments
to be made
from
amounts
received
under the Yield
Maintenance
Agreement
which will be deemed made for federal income tax purposes
outside of REMIC III by the
holder of the Class SB Certificates as the owner of the Yield
Maintenance Agreement.
(2)
The REMIC III
Regular
Interests,
ownership of which is
represented
by the
Class A-I,
Class A-II and
Class M
Certificates,
will accrue
interest at a per annum rate equal to LIBOR plus the
applicable
Margin,
each subject to a payment cap as described in the
definition of
"Pass-Through
Rate" and the
provisions for
the
payment of Basis Risk
Shortfalls
herein,
which
payments
will not be part of the
entitlement
of the
REMIC III Regular Interests related to such Certificates.
(3)
The Class A-I,
Class A-II and Class M
Certificates
will also entitle their holders to certain
payments
from the Holder of the Class SB
Certificates
from amounts to which the related REMIC III Regular Interest is
entitled and from amounts received under the Yield
Maintenance
Agreement,
which will not be a part of their
ownership of the REMIC III Regular Interests.
(4)
The Class SB
Certificates
will accrue
interest as described in the
definition
of Accrued
Certificate
Interest.
The Class SB
Certificates will not accrue interest on their
Certificate
Principal
Balance.
The
Class SB
Certificates
will be
comprised
of two
REMIC III
Regular
Interests,
a principal
only
regular
interest
designated
REMIC III
Regular
Interest
SB-PO and an interest
only
regular
interest
designated
REMIC III Regular Interest SB-IO,
which will be entitled to distributions as set forth herein.
The rights of
the Holder of the Class SB
Certificates
to payments from the Yield
Maintenance
Agreement
shall be outside
and apart from its rights under the REMIC III Regular Interests
SB-IO and SB-PO.
In consideration of the mutual
agreements herein
contained,
the Depositor,
the Master Servicer and the
Trustee agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01
Definitions.
Whenever used in this Agreement,
the following words and phrases,
unless the context otherwise requires,
shall have the meanings specified in this Article.
Accrued
Certificate
Interest:
With
respect
to
each
Distribution
Date
and
each
Class of
Class A
Certificates
and Class M
Certificates,
an amount
equal to the
interest
accrued
during the
related
Interest
Accrual Period on the Certificate
Principal
Balance thereof
immediately
prior to such
Distribution Date at the
related Pass-Through Rate for that Distribution Date.
The amount of Accrued
Certificate
Interest on each Class of
Certificates shall be reduced by the amount
of Prepayment
Interest
Shortfalls on the related Mortgage Loans during the prior calendar
month to the extent not
covered by Compensating
Interest
pursuant to
Section 3.16,
and by Relief Act Shortfalls on the related Mortgage
Loans during the related Due Period.
The portion of any
Prepayment
Interest
Shortfalls or Relief Act Shortfalls
allocated to the Class A
Certificates
will be based upon the related
Senior
Percentage
of all such
reductions
with
respect
to the
related
Mortgage
Loans,
such
reductions
will be
allocated
among the
related
Class A
Certificates,
pro rata, on the basis of Accrued
Certificate
Interest
payable on such
Distribution
Date absent
such
reductions,
with the
remainder
of such
reductions
allocated
among the Holders of all Classes of Class M
Certificates,
pro rata, on the basis of Accrued
Certificate
Interest
payable on such
Distribution
Date absent
such reductions.
Accrued
Certificate
Interest for any Distribution
Date shall further be reduced by the interest portion
of Realized Losses allocated to any Class of Certificates pursuant
to Section 4.05.
Accrued
Certificate
Interest
shall accrue on the basis of a 360-day year and the actual
number of days
in the related Interest Accrual Period.
With
respect
to each
Distribution
Date and the
Class SB
Certificates,
interest
accrued
during the
preceding
Interest
Accrual
Period at the related
Pass-Through
Rate on the
Uncertificated
Notional
Amount as
specified in the definition of Pass-Through
Rate,
immediately
prior to such
Distribution
Date,
reduced by any
interest
shortfalls with respect to the Mortgage Loans,
including
Prepayment
Interest
Shortfalls to the extent
not
covered
by
Compensating
Interest
pursuant
to
Section 3.16
or
by
Excess
Cash
Flow
pursuant
to
Section 4.02(c)(iv)
and (v). Accrued Certificate
Interest on the Class SB
Certificates shall accrue on the basis
of a 360-day year and the actual number of days in the related
Interest Accrual Period.
Adjusted
Mortgage
Rate:
With respect to any Mortgage Loan and any date of
determination,
the Mortgage
Rate borne by the related Mortgage Note, less the rate at which the
related Subservicing Fee accrues.
Adjustment
Date: With respect to each
adjustable-rate
Mortgage Loan, each date set forth in the related
Mortgage Note on which an adjustment to the interest rate on such
Mortgage Loan becomes effective.
Advance:
With
respect to any
Mortgage
Loan,
any
advance
made by the Master
Servicer,
pursuant
to
Section 4.04.
Affiliate:
With
respect to any Person,
any other
Person
controlling,
controlled
by or under
common
control
with such
first
Person.
For
purposes
of this
definition,
"control"
means
the power to direct
the
management
and
policies
of such
Person,
directly
or
indirectly,
whether
through
the
ownership
of voting
securities,
by contract or otherwise;
and the terms
"controlling" and "controlled" have meanings
correlative to
the foregoing.
Agreement:
This Pooling and Servicing Agreement and all amendments hereof and
supplements hereto.
Amount Held for Future
Distribution:
With
respect to any
Distribution
Date,
the total of the amounts
held in the
Custodial
Account
at the
close of
business
on the
preceding
Determination
Date on
account
of
(i) Liquidation Proceeds, Subsequent Recoveries, Insurance
Proceeds, REO Proceeds, Principal Prepayments,
Mortgage
Loan purchases made pursuant to Section 2.02,
2.03, 2.04 or 4.07 and Mortgage Loan
substitutions made pursuant to
Section 2.03
or 2.04
received
or made in the
month of such
Distribution
Date
(other
than
such
Liquidation
Proceeds,
Subsequent Recoveries,
Insurance Proceeds, REO Proceeds and purchases of Mortgage Loans
that the Master
Servicer has deemed to have been
received in the
preceding
month in accordance
with
Section 3.07(b))
and (ii)
payments
which
represent
early
receipt of scheduled
payments of principal
and interest due on a date or dates
subsequent to the Due Date in the related Due Period.
Appraised
Value:
With respect to any Mortgaged
Property,
the lesser of (i) the appraised value of such
Mortgaged
Property based upon the appraisal made at the time of the
origination of the related
Mortgage Loan, and
(ii) the sales
price of the
Mortgaged
Property
at such time of
origination,
except in the case of a Mortgaged
Property
securing a refinanced or modified
Mortgage Loan as to which it is either the appraised
value based upon
the appraisal made at the time of
origination of the loan which was refinanced or modified or the
appraised
value
determined in an appraisal at the time of refinancing or
modification, as the case may be.
Assignment:
An
assignment of the Mortgage,
notice of transfer or equivalent
instrument,
in recordable
form,
sufficient under the laws of the jurisdiction
wherein the related Mortgaged
Property is located to reflect
of record the sale of the Mortgage
Loan to the Trustee for the benefit of
Certificateholders,
which
assignment,
notice
of
transfer
or
equivalent
instrument
may be in the form of one or more
blanket
assignments
covering
Mortgages
secured by Mortgaged
Properties
located in the same county,
if permitted by law and accompanied by an
Opinion of Counsel to that effect.
Assignment
Agreement:
The
Assignment
and
Assumption
Agreement,
dated
the
Closing
Date,
between
Residential
Funding and the
Depositor
relating to the transfer and
assignment of the Mortgage
Loans,
attached
hereto as Exhibit R.
Available
Distribution
Amount:
With respect to any Distribution Date, an amount equal to (a) the
sum of
(i) the amount
relating to the Mortgage
Loans on deposit in the Custodial
Account as of the close of business on
the immediately
preceding
Determination Date, including any Subsequent
Recoveries,
and amounts deposited in the
Custodial
Account in connection with the substitution of Qualified
Substitute
Mortgage Loans, (ii) the amount of
any Advance
made on the
immediately
preceding
Certificate
Account
Deposit
Date with
respect to the Mortgage
Loans,
(iii) any amount
deposited in the
Certificate
Account on the related
Certificate
Account
Deposit Date
pursuant to the second
paragraph of
Section 3.12(a)
in respect of the Mortgage
Loans,
(iv) any amount that the
Master Servicer is not permitted to withdraw from the Custodial
Account pursuant to
Section 3.16(e)
in respect of
the Mortgage Loans,
and (v) any amount
deposited in the Certificate
Account
pursuant to Section 4.07 or 9.01 in
respect of the
Mortgage
Loans,
reduced by (b) the sum as of the close of business on the
immediately
preceding
Determination
Date of (x) the Amount Held for Future
Distribution
with
respect to the Mortgage
Loans,
and (y)
amounts
permitted to be withdrawn by the Master
Servicer
from the
Custodial
Account in respect of the Mortgage
Loans pursuant to clauses (ii)-(x), inclusive, of Section 3.10(a).
Balloon
Loan:
Each of the Mortgage
Loans having an original
term to maturity
that is shorter than the
related amortization term.
Balloon
Payment:
With respect to any Balloon Loan,
the related
Monthly
Payment
payable on the stated
maturity date of such Balloon Loan.
Bankruptcy Code:
The Bankruptcy Code of 1978, as amended.
Basis Risk
Shortfalls:
Group I Basis Risk
Shortfalls,
Group II Basis Risk
Shortfalls or Class M Basis
Risk Shortfalls, as applicable.
Book-Entry Certificate:
Any Certificate registered in the name of the Depository or its
nominee.
Business
Day: Any day other than (i) a Saturday or a Sunday or (ii) a day on
which
banking
institutions
in the State of
California,
the
State of
Minnesota,
the State of Texas,
the State of New York or the State of
Illinois
(and such other
state or states in which the
Custodial
Account or the
Certificate
Account are at the
time located) are required or authorized by law or executive order
to be closed.
Capitalization
Reimbursement
Amount:
With respect to any
Distribution
Date, the amount of Advances or
Servicing
Advances
that were
added to the
Stated
Principal
Balance
of the
Mortgage
Loans
during the prior
calendar
month and
reimbursed
to the
Master
Servicer
or
Subservicer
on or prior to such
Distribution
Date
pursuant to Section 3.10(a)(vii).
Cash
Liquidation:
With respect to any defaulted
Mortgage Loan other than a Mortgage Loan as to which an
REO
Acquisition
occurred,
a determination
by the Master
Servicer that it has received all Insurance
Proceeds,
Liquidation
Proceeds and other payments or cash recoveries which the Master
Servicer
reasonably and in good faith
expects to be finally recoverable with respect to such Mortgage
Loan.
Certificate:
Any Class A Certificate, Class M Certificate, Class SB Certificate
or Class R Certificate.
Certificate
Account:
The account or accounts
created and
maintained
pursuant to
Section 4.01,
which
shall be entitled "U.S. Bank National
Association,
as trustee, in trust for the registered holders of Residential
Asset Securities Corporation,
Home Equity Mortgage Asset-Backed Pass-Through
Certificates,
Series 2006-EMX8" and
which account shall be held for the benefit of the
Certificateholders and which must be an Eligible Account.
Certificate Account Deposit Date:
With respect to any Distribution Date, the Business Day prior
thereto.
Certificateholder
or Holder:
The Person in whose name a Certificate
is
registered
in the
Certificate
Register,
except that neither a Disqualified
Organization
nor a Non-United
States Person shall be a holder of a
Class R
Certificate
for any purpose
hereof.
Solely for the purpose of giving any consent or direction
pursuant
to this Agreement,
any
Certificate,
other than a Class R
Certificate,
registered in the name of the Depositor,
the Master
Servicer or any
Subservicer
or any Affiliate
thereof shall be deemed not to be
outstanding
and the
Percentage
Interest or Voting Rights evidenced thereby shall not be taken into
account in determining
whether the
requisite
amount of Percentage
Interests or Voting
Rights
necessary to effect any such consent or direction has
been
obtained.
All
references
herein
to
"Holders"
or
"Certificateholders"
shall
reflect
the
rights
of
Certificate
Owners as they may indirectly
exercise such rights through the Depository and
participating
members
thereof, except as otherwise specified herein;
provided,
however, that the Trustee shall be required to recognize
as a "Holder" or
"Certificateholder"
only the Person in whose name a Certificate is registered in the
Certificate
Register.
Certificate
Owner:
With respect to a Book-Entry
Certificate,
the Person who is the beneficial owner of
such
Certificate,
as reflected on the books of an indirect
participating
brokerage
firm for which a Depository
Participant
acts as agent, if any, and otherwise on the books of a Depository
Participant,
if any, and otherwise
on the books of the Depository.
Certificate
Principal Balance:
With respect to any Class A
Certificate or Class M
Certificate,
on any
date of
determination,
an amount equal to (i) the Initial
Certificate
Principal
Balance of such Certificate as
specified on the face thereof,
minus (ii) the sum of (x) the aggregate of all amounts previously
distributed with
respect to such
Certificate
(or any
predecessor
Certificate)
and applied to reduce the
Certificate
Principal
Balance
thereof
pursuant to
Section 4.02(c)
and (y) the aggregate of all
reductions in
Certificate
Principal
Balance
deemed to have
occurred in
connection
with
Realized
Losses
which were
previously
allocated to such
Certificate
(or any
predecessor
Certificate)
pursuant
to
Section 4.05;
provided,
that with
respect
to any
Distribution
Date,
the
Certificate
Principal
Balances
of:
(i)
the
Class A-I
Certificates
and
Class M
Certificates
will be
increased,
in each case to the extent to which a
Realized
Loss was
previously
allocated
thereto
and
remaining
unreimbursed,
by the
Subsequent
Recovery
Allocation
Amount
for Loan
Group I
in the
following
order of
priority:
first to the
Class A-I
Certificates,
pro rata,
based on the amount of
Realized
Losses previously allocated thereto and remaining unreimbursed,
and then to the Class M-1 Certificates,
Class M-2
Certificates,
Class M-3
Certificates,
Class M-4 Certificates,
Class M-5
Certificates,
Class M-6 Certificates,
Class M-7 Certificates,
Class M-8 Certificates and Class M-9 Certificates,
in that order, and (ii) the Class A-II
Certificates
and
Class M
Certificates
will be
increased,
in each
case,
to the
extent
of
Realized
Losses
previously
allocated thereto and remaining
unreimbursed,
by the Subsequent
Recovery
Allocation Amount for Loan
Group II in the following order of priority:
to the Class A-II
Certificates,
Class M-1
Certificates,
Class M-2
Certificates,
Class M-3
Certificates,
Class M-4 Certificates,
Class M-5
Certificates,
Class M-6 Certificates,
Class M-7 Certificates, Class M-8 Certificates and Class M-9
Certificates, in that order.
With
respect
to any
Class SB
Certificate,
on any
date
of
determination,
an
amount
equal
to the
Percentage
Interest
evidenced by such
Certificate,
multiplied by an amount equal to (i) the excess,
if any, of
(A) the then aggregate
Stated
Principal
Balance of the Mortgage
Loans over (B) the then
aggregate
Certificate
Principal Balance of the Class A Certificates and Class M
Certificates then outstanding,
which represents the sum
of (i) the Initial
Principal
Balance of the
REMIC III
Regular
Interest
SB-PO,
as reduced by Realized
Losses
allocated
thereto and payments deemed made thereon,
and (ii) accrued and unpaid interest on the REMIC III Regular
Interest
SB-IO,
as reduced by
Realized
Losses
allocated
thereto.
The
Class R
Certificates
will not have a
Certificate Principal Balance.
Certificate
Register and
Certificate
Registrar:
The register
maintained
and the registrar
appointed
pursuant to Section 5.02.
Class:
Collectively, all of the Certificates or uncertificated interests
bearing the same designation.
Class A Certificates:
Collectively, the Class A-I-1 Certificates,
Class A-I-2 Certificates,
Class A-I-3
Certificates, Class A-I-4 Certificates and Class A-II Certificates.
Class A
Interest
Distribution
Priority:
With
respect to each Class of
Class A
Certificates
and any
Distribution Date, the amount available for payment of Accrued
Certificate
Interest thereon for that Distribution
Date plus Accrued
Certificate
Interest thereon remaining unpaid from any prior
Distribution Date, in the amounts
and priority as follows:
(i)
first,
concurrently,
to the Class A-I
Certificates,
pro rata, from the Class A-I
Interest
Remittance
Amount, and to the Class A-II Certificates, from the Class A-II
Interest Remittance Amount;
(ii)
second,
to the
Class A-I
Certificates,
pro
rata,
from
the
remaining
Class A-II
Interest
Remittance
Amount,
or to the Class A-II
Certificates,
from the remaining
Class A-I
Interest
Remittance
Amount,
as needed after taking into account any distributions in respect of
interest
on the Class A Certificates made in first above;
(iii)
third,
concurrently,
to the Class A-I
Certificates,
pro rata,
from the Principal
Remittance
Amount
related
to
Loan
Group I,
and to
the
Class A-II
Certificates,
from
the
Principal
Remittance
Amount
related
to
Loan
Group II,
as
needed
after
taking
into
account
any
distributions
in
respect
of
interest
on the
Class A
Certificates
made in first and second
above; and
(iv)
fourth, to the Class A-I
Certificates,
pro rata, from the remaining Principal Remittance Amount
related
to Loan
Group II,
or to the
Class A-II
Certificates,
from the
remaining
Principal
Remittance
Amount
related
to
Loan
Group I,
as
needed
after
taking
into
account
any
distributions
in respect of
interest
on the
Class A
Certificates
made in first,
second and
third above.
Class A
Principal
Distribution
Amount:
With respect to any Distribution Date (a) prior to the Stepdown
Date or on or after the Stepdown Date if a Trigger
Event is in effect for that
Distribution
Date,
the Principal
Distribution
Amount for that
Distribution
Date or (b) on or after the Stepdown Date if a Trigger Event is not
in
effect for that Distribution Date, the lesser of:
(i)
the Principal Distribution Amount for that Distribution Date; and
(ii)
the excess,
if any,
of (A) the
aggregate
Certificate
Principal
Balance of the
Class A
Certificates
immediately
prior to that
Distribution
Date
over (B) the
lesser
of (x) the
product
of (1) the
applicable
Subordination
Percentage and (2) the aggregate Stated Principal
Balance of the Mortgage
Loans after giving effect to distributions to be made on that
Distribution
Date and (y) the excess,
if any, of the
aggregate
Stated
Principal
Balance of the Mortgage
Loans after
giving
effect to
distributions to be made on that Distribution Date, over the
Overcollateralization Floor.
Class A-I-1
Certificate:
Any
one
of
the
Class A-I-1
Certificates
executed
by
the
Trustee
and
authenticated by the Certificate
Registrar
substantially
in the form annexed hereto as Exhibit A,
senior to the
Class M
Certificates,
Class SB
Certificates
and Class R
Certificates
with
respect to
distributions
and the
allocation
of Realized
Losses in respect of Group I Loans as set forth in
Section 4.05,
and
evidencing
(i) an
interest
designated as a "regular
interest" in REMIC III for purposes of the REMIC
Provisions and (ii) the right
to receive payments under the Yield Maintenance Agreement.
Class A-I-1 Margin:
0.0800% per annum.
Class A-I-2
Certificate:
Any
one
of
the
Class A-I-2
Certificates
executed
by
the
Trustee
and
authenticated by the Certificate
Registrar
substantially
in the form annexed hereto as Exhibit A,
senior to the
Class M
Certificates,
Class SB
Certificates
and Class R
Certificates
with
respect to
distributions
and the
allocation
of Realized
Losses in respect of Group I Loans as set forth in
Section 4.05,
and
evidencing
(i) an
interest
designated as a "regular
interest" in REMIC III for purposes of the REMIC
Provisions and (ii) the right
to receive payments under the Yield Maintenance Agreement.
Class A-I-2 Margin:
0.1200% per annum.
Class A-I-3
Certificate:
Any
one
of
the
Class A-I-3
Certificates
executed
by
the
Trustee
and
authenticated by the Certificate
Registrar
substantially
in the form annexed hereto as Exhibit A,
senior to the
Class M
Certificates,
Class
SB
Certificates
and Class R
Certificates
with respect to
distributions
and the
allocation
of Realized
Losses in respect of Group I Loans as set forth in
Section 4.05,
and
evidencing
(i) an
interest
designated as a "regular
interest" in REMIC III for purposes of the REMIC
Provisions and (ii) the right
to receive payments under the Yield Maintenance Agreement.
Class A-I-3
Margin:
Initially,
0.1700% per annum, and on any Distribution
Date on and after the second
Distribution Date after the first possible Optional Termination
Date, 0.3400% per annum.
Class A-I-4
Certificate:
Any
one
of
the
Class A-I-4
Certificates
executed
by
the
Trustee
and
authenticated by the Certificate
Registrar
substantially
in the form annexed hereto as Exhibit A,
senior to the
Class M
Certificates,
Class
SB
Certificates
and Class R
Certificates
with respect to
distributions
and the
allocation
of Realized
Losses in respect of Group I Loans as set forth in
Section 4.05,
and
evidencing
(i) an
interest
designated as a "regular
interest" in REMIC III for purposes of the REMIC
Provisions and (ii) the right
to receive payments under the Yield Maintenance Agreement.
Class A-I-4
Margin:
Initially,
0.2500% per annum, and on any Distribution
Date on and after the second
Distribution Date after the first possible Optional Termination
Date, 0.5000% per annum.
Class A-I
Certificates:
Collectively,
the
Class A-I-1
Certificates,
Class A-I-2
Certificates,
Class A-I-3 Certificates and Class A-I-4 Certificates.
Class A-I
Interest
Remittance
Amount:
With
respect
to any
Distribution
Date,
the
portion
of the
Available
Distribution
Amount for that
Distribution
Date
attributable
to interest
received or advanced
with
respect to the Group I Loans.
Class A-II
Certificate:
Any
one
of
the
Class A-II
Certificates
executed
by
the
Trustee
and
authenticated by the Certificate
Registrar
substantially
in the form annexed hereto as Exhibit A,
senior to the
Class M
Certificates,
Class
SB
Certificates
and Class R
Certificates
with respect to
distributions
and the
allocation of Realized
Losses in respect of Group II
Loans as set forth in
Section 4.05,
and
evidencing (i) an
interest
designated as a "regular
interest" in REMIC III for purposes of the REMIC
Provisions and (ii) the right
to receive payments under the Yield Maintenance Agreement.
Class A-II
Interest
Remittance
Amount:
With
respect
to any
Distribution
Date,
the
portion of the
Available
Distribution
Amount for that
Distribution
Date
attributable
to interest
received or advanced
with
respect to the Group II Loans.
Class A-II
Margin:
Initially,
0.1350% per annum, and on any
Distribution
Date on and after the second
Distribution Date after the first possible Optional Termination
Date, 0.2700% per annum.
Class M-1
Certificate:
Any one of the Class M-1
Certificates
executed by the Trustee and authenticated
by the
Certificate
Registrar
substantially
in the form
annexed
hereto as
Exhibit B,
and
evidencing
(i) an
interest
designated as a "regular
interest" in REMIC III for purposes of the REMIC
Provisions and (ii) the right
to receive payments under the Yield Maintenance Agreement.
Class M-1
Margin:
Initially,
0.3000% per annum,
and on any
Distribution
Date on and after the second
Distribution Date after the first possible Optional Termination
Date, 0.4500% per annum.
Class M-1
Principal
Distribution
Amount:
With
respect
to any
Distribution
Date
(a)
prior
to the
Stepdown
Date or on or after the Stepdown
Date if a Trigger Event is in effect for that
Distribution
Date,
the
remaining
Principal
Distribution
Amount for that Distribution
Date after
distribution of the Class A Principal
Distribution
Amount
or (b) on or
after
the
Stepdown
Date
if a
Trigger
Event
is not
in
effect
for
that
Distribution Date, the lesser of:
(iii)
the remaining
Principal
Distribution Amount for that Distribution Date after distribution
of the Class A
Principal Distribution Amount; and
(iv)
the
excess,
if any, of (A) the sum of (1) the
aggregate
Certificate
Principal
Balance of the Class A
Certificates
(after
taking
into
account the
payment of the
Class A
Principal
Distribution
Amount for that
Distribution
Date) and (2) the Certificate
Principal
Balance of the Class M-1
Certificates
immediately
prior to that Distribution Date over (B) the lesser of (x) the
product
of (1) the applicable
Subordination
Percentage and (2) the aggregate Stated
Principal
Balance
of the Mortgage Loans after giving effect to distributions to be
made on that
Distribution
Date
and (y) the excess,
if any, of the
aggregate
Stated
Principal
Balance of the Mortgage
Loans
after
giving
effect
to
distributions
to
be
made
on
that
Distribution
Date,
over
the
Overcollateralization Floor.
Class M-2
Certificate:
Any one of the Class M-2
Certificates
executed by the Trustee and authenticated
by the
Certificate
Registrar
substantially
in the form
annexed
hereto as
Exhibit B,
and
evidencing
(i) an
interest
designated as a "regular
interest" in REMIC III for purposes of the REMIC
Provisions and (ii) the right
to receive payments under the Yield Maintenance Agreement.
Class M-2
Margin:
Initially,
0.3200% per annum,
and on any
Distribution
Date on and after the second
Distribution Date after the first possible Optional Termination
Date, 0.4800% per annum.
Class M-2
Principal
Distribution
Amount:
With
respect
to
any
Distribution
Date
(a) prior
to the
Stepdown
Date or on or after the Stepdown
Date if a Trigger Event is in effect for that
Distribution
Date,
the
remaining
Principal
Distribution
Amount for that Distribution
Date after
distribution of the Class A Principal
Distribution
Amount and the
Class M-1
Principal
Distribution
Amount or (b) on or after the Stepdown
Date if a
Trigger Event is not in effect for that Distribution Date, the
lesser of:
(i)
the remaining
Principal
Distribution Amount for that Distribution Date after distribution
of the Class A
Principal Distribution Amount and the Class M-1 Principal
Distribution Amount; and
(ii)
the
excess,
if any, of (A) the sum of (1) the
aggregate
Certificate
Principal
Balance of the Class A
Certificates
and
Class M-1
Certificates
(after
taking
into
account
the payment of the Class A
Principal
Distribution Amount and the Class M-1 Principal
Distribution Amount for that Distribution
Date) and (2) the Certificate
Principal Balance of the Class M-2
Certificates
immediately prior to
that
Distribution
Date over (B) the lesser of (x) the
product of (1) the applicable
Subordination
Percentage and (2) the aggregate Stated
Principal
Balance of the Mortgage Loans after giving effect
to distributions to be made on that
Distribution
Date and (y) the excess,
if any, of the aggregate
Stated
Principal
Balance of the Mortgage Loans after giving effect to
distributions
to be made on
that Distribution Date, over the Overcollateralization Floor.
Class M-3
Certificate:
Any one of the Class M-3
Certificates
executed by the Trustee and authenticated
by the
Certificate
Registrar
substantially
in the form
annexed
hereto as
Exhibit B,
and
evidencing
(i) an
interest
designated as a "regular
interest" in REMIC III for purposes of the REMIC
Provisions and (ii) the right
to receive payments under the Yield Maintenance Agreement.
Class M-3
Margin:
Initially,
0.3400% per annum,
and on any
Distribution
Date on and after the second
Distribution Date after the first possible Optional Termination
Date, 0.5100% per annum.
Class M-3
Principal
Distribution
Amount:
With
respect
to any
Distribution
Date
(a)
prior
to the
Stepdown
Date or on or after the Stepdown
Date if a Trigger Event is in effect for that
Distribution
Date,
the
remaining
Principal
Distribution
Amount for that Distribution
Date after
distribution of the Class A Principal
Distribution
Amount, the Class M-1 Principal
Distribution Amount and the Class M-2 Principal
Distribution Amount
or (b) on or after the Stepdown Date if a Trigger
Event is not in effect for that
Distribution
Date,
the lesser
of:
(i)
the remaining
Principal
Distribution Amount for that Distribution Date after distribution
of the Class A
Principal
Distribution
Amount,
the
Class M-1
Principal
Distribution
Amount
and the
Class M-2
Principal Distribution Amount; and
(ii)
the
excess,
if any, of (A) the sum of (1) the
aggregate
Certificate
Principal
Balance of the Class A
Certificates,
Class M-1
Certificates
and
Class M-2
Certificates
(after
taking into account the
payment of the Class A Principal
Distribution
Amount, the Class M-1
Principal
Distribution Amount
and the Class M-2
Principal
Distribution Amount for that Distribution Date) and (2) the
Certificate
Principal
Balance of the Class M-3
Certificates
immediately
prior to that
Distribution Date over
(B) the
lesser
of (x)
the
product
of (1) the
applicable
Subordination
Percentage
and (2) the
aggregate Stated
Principal
Balance of the Mortgage Loans after giving effect to distributions
to be
made on that
Distribution
Date and
(y) the
excess,
if any,
of the
aggregate
Stated
Principal
Balance of the Mortgage Loans after giving effect to
distributions
to be made on that
Distribution
Date, over the Overcollateralization Floor.
Class M-4
Certificate:
Any one of the Class M-4
Certificates
executed by the Trustee and authenticated
by the
Certificate
Registrar
substantially
in the form
annexed
hereto as
Exhibit B,
and
evidencing
(i) an
interest
designated as a "regular
interest" in REMIC III for purposes of the REMIC
Provisions and (ii) the right
to receive payments under the Yield Maintenance Agreement.
Class M-4
Margin:
Initially,
0.3800% per annum,
and on any
Distribution
Date on and after the second
Distribution Date after the first possible Optional Termination
Date, 0.5700% per annum.
Class M-4
Principal
Distribution
Amount:
With
respect
to any
Distribution
Date
(a)
prior
to the
Stepdown
Date or on or after the Stepdown
Date if a Trigger Event is in effect for that
Distribution
Date,
the
remaining
Principal
Distribution
Amount for that Distribution
Date after
distribution of the Class A Principal
Distribution Amount, the Class M-1 Principal
Distribution Amount, the Class M-2 Principal
Distribution Amount and
the
Class M-3
Principal
Distribution
Amount or (b) on or after the Stepdown
Date if a Trigger
Event is not in
effect for that Distribution Date, the lesser of:
(i)
the remaining
Principal
Distribution Amount for that Distribution Date after distribution
of the Class A
Principal
Distribution Amount, the Class M-1 Principal
Distribution Amount, the Class M-2 Principal
Distribution Amount and the Class M-3 Principal Distribution
Amount; and
(ii)
the
excess,
if any, of (A) the sum of (1) the
aggregate
Certificate
Principal
Balance of the Class A
Certificates,
Class M-1
Certificates,
Class M-2
Certificates
and Class M-3
Certificates
(after
taking
into
account
the
payment of the
Class A
Principal
Distribution
Amount,
the
Class M-1
Principal
Distribution
Amount,
the
Class M-2
Principal
Distribution
Amount
and the
Class M-3
Principal
Distribution Amount for that Distribution Date) and (2) the
Certificate
Principal Balance
of the Class M-4
Certificates
immediately
prior to that
Distribution
Date over (B) the lesser of
(x) the
product
of (1) the
applicable
Subordination
Percentage
and
(2)
the
aggregate
Stated
Principal
Balance of the Mortgage
Loans after
giving
effect to
distributions
to be made on that
Distribution
Date and (y) the
excess,
if any, of the
aggregate
Stated
Principal
Balance of the
Mortgage Loans after giving effect to
distributions to be made on that
Distribution
Date, over the
Overcollateralization Floor.
Class M-5
Certificate:
Any one of the Class M-5
Certificates
executed by the Trustee and authenticated
by the
Certificate
Registrar
substantially
in the form
annexed
hereto as
Exhibit B,
and
evidencing
(i) an
interest
designated as a "regular
interest" in REMIC III for purposes of the REMIC
Provisions and (ii) the right
to receive payments under the Yield Maintenance Agreement.
Class M-5
Margin:
Initially,
0.4100% per annum,
and on any
Distribution
Date on and after the second
Distribution Date after the first possible Optional Termination
Date, 0.6150% per annum.
Class M-5
Principal
Distribution
Amount:
With
respect
to any
Distribution
Date
(a)
prior
to the
Stepdown
Date or on or after the Stepdown
Date if a Trigger Event is in effect for that
Distribution
Date,
the
remaining
Principal
Distribution
Amount for that Distribution
Date after
distribution of the Class A Principal
Distribution
Amount, the Class M-1 Principal
Distribution
Amount, the Class M-2 Principal
Distribution
Amount,
the Class M-3
Principal
Distribution
Amount and the Class M-4
Principal
Distribution Amount or (b) on or after
the Stepdown Date if a Trigger Event is not in effect for that
Distribution Date, the lesser of:
(i)
the remaining
Principal
Distribution Amount for that Distribution Date after distribution
of the Class A
Principal
Distribution Amount, the Class M-1 Principal
Distribution Amount, the Class M-2 Principal
Distribution
Amount,
the
Class M-3
Principal
Distribution
Amount
and the
Class M-4
Principal
Distribution Amount; and
(ii)
the
excess,
if any, of (A) the sum of (1) the
aggregate
Certificate
Principal
Balance of the Class A
Certificates,
Class M-1 Certificates,
Class M-2 Certificates,
Class M-3 Certificates and Class M-4
Certificates
(after taking into account the payment of the Class A
Principal
Distribution
Amount,
the Class M-1
Principal
Distribution
Amount,
the Class M-2
Principal
Distribution
Amount,
the
Class M-3
Principal
Distribution
Amount and the Class M-4
Principal
Distribution Amount for that
Distribution
Date)
and
(2)
the
Certificate
Principal
Balance
of
the
Class M-5
Certificates
immediately
prior to that
Distribution
Date
over (B) the
lesser
of (x) the
product
of (1) the
applicable
Subordination
Percentage and (2) the aggregate Stated Principal
Balance of the Mortgage
Loans after giving effect to distributions to be made on that
Distribution
Date and (y) the excess,
if any, of the
aggregate
Stated
Principal
Balance of the Mortgage
Loans after
giving
effect to
distributions to be made on that Distribution Date, over the
Overcollateralization Floor.
Class M-6
Certificate:
Any one of the Class M-6
Certificates
executed by the Trustee and authenticated
by the
Certificate
Registrar
substantially
in the form
annexed
hereto as
Exhibit B,
and
evidencing
(i) an
interest
designated as a "regular
interest" in REMIC III for purposes of the REMIC
Provisions and (ii) the right
to receive payments under the Yield Maintenance Agreement.
Class M-6
Margin:
Initially,
0.4700% per annum,
and on any
Distribution
Date on and after the second
Distribution Date after the first possible Optional Termination
Date, 0.7050% per annum.
Class M-6
Principal
Distribution
Amount:
With
respect
to any
Distribution
Date
(a)
prior
to the
Stepdown
Date or on or after the Stepdown
Date if a Trigger Event is in effect for that
Distribution
Date,
the
remaining
Principal
Distribution
Amount for that Distribution
Date after
distribution of the Class A Principal
Distribution
Amount, the Class M-1 Principal
Distribution
Amount, the Class M-2 Principal
Distribution
Amount,
the
Class M-3
Principal
Distribution
Amount,
the
Class M-4
Principal
Distribution
Amount and the Class M-5
Principal
Distribution
Amount or (b) on or after the Stepdown
Date if a Trigger
Event is not in effect for that
Distribution Date, the lesser of:
(iii)
the remaining
Principal
Distribution Amount for that Distribution Date after distribution
of the Class A
Principal
Distribution Amount, the Class M-1 Principal
Distribution Amount, the Class M-2 Principal
Distribution
Amount,
the
Class M-3
Principal
Distribution
Amount,
the
Class M-4
Principal
Distribution Amount and the Class M-5 Principal Distribution
Amount; and
(iv)
the
excess,
if any, of (A) the sum of (1) the
aggregate
Certificate
Principal
Balance of the Class A
Certificates,
Class M-1
Certificates,
Class M-2 Certificates,
Class M-3
Certificates,
Class M-4
Certificates
and
Class M-5
Certificates
(after
taking
into
account
the payment of the Class A
Principal
Distribution Amount, the Class M-1 Principal
Distribution Amount, the Class M-2 Principal
Distribution
Amount,
the
Class M-3
Principal
Distribution
Amount,
the
Class M-4
Principal
Distribution Amount and the Class M-5
Principal
Distribution Amount for that Distribution Date) and
(2) the
Certificate
Principal
Balance
of the
Class M-6
Certificates
immediately
prior to that
Distribution
Date
over
(B) the
lesser
of (x) the
product
of (1) the
applicable
Subordination
Percentage and (2) the aggregate Stated
Principal
Balance of the Mortgage Loans after giving effect
to distributions to be made on that
Distribution
Date and (y) the excess,
if any, of the aggregate
Stated
Principal
Balance of the Mortgage Loans after giving effect to
distributions
to be made on
that Distribution Date, over the Overcollateralization Floor.
Class M-7
Certificate:
Any one of the Class M-7
Certificates
executed by the Trustee and authenticated
by the
Certificate
Registrar
substantially
in the form
annexed
hereto as
Exhibit B,
and
evidencing
(i) an
interest
designated as a "regular
interest" in REMIC III for purposes of the REMIC
Provisions and (ii) the right
to receive payments under the Yield Maintenance Agreement.
Class M-7
Margin:
Initially,
0.8000% per annum,
and on any
Distribution
Date on and after the second
Distribution Date after the first possible Optional Termination
Date, 1.2000% per annum.
Class M-7
Principal
Distribution
Amount:
With
respect
to any
Distribution
Date
(a)
prior
to the
Stepdown
Date or on or after the Stepdown
Date if a Trigger Event is in effect for that
Distribution
Date,
the
remaining
Principal
Distribution
Amount for that Distribution
Date after
distribution of the Class A Principal
Distribution
Amount, the Class M-1 Principal
Distribution
Amount, the Class M-2 Principal
Distribution
Amount,
the Class M-3 Principal
Distribution Amount, the Class M-4 Principal
Distribution Amount, the Class M-5 Principal
Distribution
Amount and the
Class M-6
Principal
Distribution
Amount or (b) on or after the Stepdown
Date if a
Trigger Event is not in effect for that Distribution Date, the
lesser of:
(i)
the remaining
Principal
Distribution Amount for that Distribution Date after distribution
of the Class A
Principal
Distribution Amount, the Class M-1 Principal
Distribution Amount, the Class M-2 Principal
Distribution
Amount,
the
Class M-3
Principal
Distribution
Amount,
the
Class M-4
Principal
Distribution
Amount,
the
Class M-5
Principal
Distribution
Amount
and the
Class M-6
Principal
Distribution Amount; and
(ii)
the
excess,
if any, of (A) the sum of (1) the
aggregate
Certificate
Principal
Balance of the Class A
Certificates,
Class M-1
Certificates,
Class M-2 Certificates,
Class M-3
Certificates,
Class M-4
Certificates,
Class M-5
Certificates
and
Class M-6
Certificates
(after
taking into account the
payment of the Class A Principal
Distribution
Amount, the Class M-1 Principal
Distribution Amount,
the Class M-2
Principal
Distribution
Amount,
the Class M-3
Principal
Distribution
Amount,
the
Class M-4
Principal
Distribution
Amount,
the
Class M-5
Principal
Distribution
Amount
and the
Class M-6
Principal
Distribution
Amount
for
that
Distribution
Date)
and (2)
the
Certificate
Principal
Balance of the Class M-7
Certificates
immediately
prior to that
Distribution Date over
(B) the
lesser
of (x)
the
product
of (1) the
applicable
Subordination
Percentage
and (2) the
aggregate Stated
Principal
Balance of the Mortgage Loans after giving effect to distributions
to be
made on that
Distribution
Date and
(y) the
excess,
if any,
of the
aggregate
Stated
Principal
Balance of the Mortgage Loans after giving effect to
distributions
to be made on that
Distribution
Date, over the Overcollateralization Floor.
Class M-8
Certificate:
Any one of the Class M-8
Certificates
executed by the Trustee and authenticated
by the
Certificate
Registrar
substantially
in the form
annexed
hereto as
Exhibit B,
and
evidencing
(i) an
interest
designated as a "regular
interest" in REMIC III for purposes of the REMIC
Provisions and (ii) the right
to receive payments under the Yield Maintenance Agreement.
Class M-8
Margin:
Initially,
1.0500% per annum,
and on any
Distribution
Date on and after the second
Distribution Date after the first possible Optional Termination
Date, 1.5750% per annum.
Class M-8
Principal
Distribution
Amount:
With
respect
to any
Distribution
Date
(a)
prior
to the
Stepdown
Date or on or after the Stepdown
Date if a Trigger Event is in effect for that
Distribution
Date,
the
remaining
Principal
Distribution
Amount for that Distribution
Date after
distribution of the Class A Principal
Distribution
Amount, the Class M-1 Principal
Distribution
Amount, the Class M-2 Principal
Distribution
Amount,
the Class M-3 Principal
Distribution Amount, the Class M-4 Principal
Distribution Amount, the Class M-5 Principal
Distribution
Amount, the Class M-6 Principal
Distribution Amount and the Class M-7 Principal
Distribution Amount
or (b) on or after the Stepdown Date if a Trigger
Event is not in effect for that
Distribution
Date,
the lesser
of:
(i)
the remaining
Principal
Distribution Amount for that Distribution Date after distribution
of the Class A
Principal
Distribution Amount, the Class M-1 Principal
Distribution Amount, the Class M-2 Principal
Distribution
Amount,
the
Class M-3
Principal
Distribution
Amount,
the
Class M-4
Principal
Distribution
Amount,
the
Class M-5
Principal
Distribution
Amount,
the
Class M-6
Principal
Distribution Amount and the Class M-7 Principal Distribution
Amount; and
(ii)
the
excess,
if any, of (A) the sum of (1) the
aggregate
Certificate
Principal
Balance of the Class A
Certificates,
Class M-1
Certificates,
Class M-2 Certificates,
Class M-3
Certificates,
Class M-4
Certificates,
Class M-5
Certificates,
Class M-6
Certificates
and Class M-7
Certificates
(after
taking
into
account
the
payment of the
Class A
Principal
Distribution
Amount,
the
Class M-1
Principal
Distribution Amount, the Class M-2 Principal
Distribution Amount, the Class M-3 Principal
Distribution
Amount,
the
Class M-4
Principal
Distribution
Amount,
the
Class M-5
Principal
Distribution
Amount,
the
Class M-6
Principal
Distribution
Amount
and the
Class M-7
Principal
Distribution
Amount for that
Distribution
Date) and (2) the
Certificate
Principal Balance of the
Class M-8
Certificates
immediately
prior to that
Distribution Date over (B) the lesser of (x) the
product
of (1) the
applicable
Subordination
Percentage
and (2) the
aggregate
Stated
Principal
Balance of the Mortgage Loans after giving effect to
distributions
to be made on that
Distribution
Date and (y) the
excess,
if any, of the aggregate
Stated
Principal
Balance of the Mortgage Loans
after
giving
effect
to
distributions
to
be
made
on
that
Distribution
Date,
over
the
Overcollateralization Floor.
Class M-9
Certificate:
Any one of the Class M-9
Certificates
executed by the Trustee and authenticated
by the
Certificate
Registrar
substantially
in the form
annexed
hereto as
Exhibit B,
and
evidencing
(i) an
interest
designated as a "regular
interest" in REMIC III for purposes of the REMIC
Provisions and (ii) the right
to receive payments under the Yield Maintenance Agreement.
Class M-9
Margin:
Initially,
2.1000% per annum,
and on any
Distribution
Date on and after the second
Distribution Date after the first possible Optional Termination
Date, 3.1500% per annum.
Class M-9
Principal
Distribution
Amount:
With
respect
to any
Distribution
Date
(a)
prior
to the
Stepdown
Date or on or after the Stepdown
Date if a Trigger Event is in effect for that
Distribution
Date,
the
remaining
Principal
Distribution
Amount for that Distribution
Date after
distribution of the Class A Principal
Distribution
Amount, the Class M-1 Principal
Distribution
Amount, the Class M-2 Principal
Distribution
Amount,
the Class M-3 Principal
Distribution Amount, the Class M-4 Principal
Distribution Amount, the Class M-5 Principal
Distribution Amount, the Class M-6 Principal
Distribution Amount, the Class M-7 Principal
Distribution Amount and
the
Class M-8
Principal
Distribution
Amount or (b) on or after the Stepdown
Date if a Trigger
Event is not in
effect for that Distribution Date, the lesser of:
(i)
the remaining
Principal
Distribution Amount for that Distribution Date after distribution
of the Class A
Principal
Distribution Amount, the Class M-1 Principal
Distribution Amount, the Class M-2 Principal
Distribution
Amount,
the
Class M-3
Principal
Distribution
Amount,
the
Class M-4
Principal
Distribution Amount, the Class M-5 Principal
Distribution Amount,
Class M-6 Principal
Distribution
Amount,
the
Class M-7
Principal
Distribution
Amount
and the
Class M-8
Principal
Distribution
Amount; and
(ii)
the
excess,
if any, of (A) the sum of (1) the
aggregate
Certificate
Principal
Balance of the Class A
Certificates,
Class M-1
Certificates,
Class M-2 Certificates,
Class M-3
Certificates,
Class M-4
Certificates,
Class M-5 Certificates,
Class M-6 Certificates,
Class M-7 Certificates and Class M-8
Certificates
(after taking into account the payment of the Class A
Principal
Distribution
Amount,
the Class M-1
Principal
Distribution
Amount,
the Class M-2
Principal
Distribution
Amount,
the
Class M-3 Principal
Distribution Amount, the Class M-4 Principal
Distribution Amount, the Class M-5
Principal
Distribution Amount, the Class M-6 Principal
Distribution Amount, the Class M-7 Principal
Distribution Amount and the Class M-8
Principal
Distribution Amount for that Distribution Date) and
(2) the
Certificate
Principal
Balance
of the
Class M-9
Certificates
immediately
prior to that
Distribution
Date
over
(B) the
lesser
of (x) the
product
of (1) the
applicable
Subordination
Percentage and (2) the aggregate Stated
Principal
Balance of the Mortgage Loans after giving effect
to distributions to be made on that
Distribution
Date and (y) the excess,
if any, of the aggregate
Stated
Principal
Balance of the Mortgage Loans after giving effect to
distributions
to be made on
that Distribution Date, over the Overcollateralization Floor.
Class M
Basis Risk
Shortfall:
With respect to any Class of Class M
Certificates
and any
Distribution
Date, an amount equal to the excess of (i) Accrued
Certificate
Interest for that Class
calculated at a per annum
rate (which
shall not exceed
14.000%
per annum)
equal to LIBOR plus the
related
Margin for that
Distribution
Date, over (ii) Accrued Certificate
Interest for that Class if the Pass-Through Rate for that
Distribution Date is
calculated
using the Class M
Net WAC Cap Rate for that
Distribution
Date;
plus any unpaid
Class M
Basis Risk
Shortfall from prior
Distribution
Dates,
plus interest
thereon,
to the extent not previously
paid from Excess
Cash Flow,
at a per annum rate (which shall not exceed
14.000% per annum) equal to LIBOR plus the related
Margin
for that Distribution Date.
Class M
Certificates:
Collectively,
the
Class M-1
Certificates,
Class M-2
Certificates,
Class M-3
Certificates,
Class M-4
Certificates,
Class M-5 Certificates,
Class M-6
Certificates,
Class M-7 Certificates,
Class M-8 Certificates and Class M-9 Certificates.
Class M
Net WAC Cap Rate:
With
respect to any
Distribution
Date and the Class M
Certificates,
a per
annum rate
equal to the
weighted
average
of (i) the
Group I
Net WAC Cap Rate for that
Distribution
Date and
(ii) the Group II Net WAC Cap Rate for that
Distribution
Date,
weighted on the basis of the related
Subordinate
Component,
which for tax
purposes is equal to the weighted
average of the interest
rates on the REMIC I Regular
Interests Y-1 and Y-2.
Class R
Certificate:
Any one of the Class R
Certificates
executed by the Trustee and
authenticated by
the
Certificate
Registrar
substantially
in the form annexed
hereto as
Exhibit D
and
evidencing
an interest
designated as a "residual interest" in a REMIC for purposes of the
REMIC Provisions.
Class SB
Certificate:
Any one of the Class SB
Certificates executed by the Trustee and authenticated by
the
Certificate
Registrar
substantially
in the form annexed
hereto as
Exhibit C,
subordinate
to the Class A
Certificates and Class M
Certificates
with respect to distributions
and the allocation of Realized Losses as set
forth in
Section 4.05,
and
evidencing an interest
comprised of "regular
interests" in REMIC III
together with
certain rights to payments under the Yield Maintenance Agreement
for purposes of the REMIC Provisions.
Closing Date:
September 28, 2006.
Code:
The Internal Revenue Code of 1986.
Commission:
The Securities and Exchange Commission.
Compensating
Interest:
With respect to any Distribution
Date, any amount paid by the Master Servicer in
accordance with Section 3.16(f).
Corporate
Trust
Office:
The
principal
office
of the
Trustee
at
which at any
particular
time its
corporate
trust business with respect to this
Agreement
shall be
administered,
which office at the date of the
execution of this instrument is located at U.S. Bank National
Association,
EP-MN-WS3D,
60 Livingston Avenue, St.
Paul, Minnesota 55107, Attn: Structured Finance/RASC 2006-EMX8.
Credit Repository:
Equifax, Transunion and Experian, or their successors in interest.
Curtailment:
Any Principal Prepayment made by a Mortgagor which is not a
Principal Prepayment in Full.
Custodial
Account:
The custodial account or accounts created and maintained
pursuant to Section 3.07 in
the name of a
depository
institution,
as
custodian
for the
holders of the
Certificates,
for the
holders of
certain other
interests in mortgage
loans
serviced or sold by the Master
Servicer and for the Master
Servicer,
into which the amounts set forth in Section 3.07
shall be deposited
directly.
Any such account or accounts shall
be an Eligible Account.
Custodial
Agreement:
An agreement
that may be entered into among the
Depositor,
the Master
Servicer,
the Trustee and a Custodian in substantially the form of Exhibit E
hereto.
Custodial
File:
Any mortgage
loan document in the Mortgage File that is required to be delivered
to the
Trustee or the Custodian pursuant to Section 2.01(b) of this
Agreement.
Custodian:
Wells
Fargo
Bank,
N.A.,
or any
successor
custodian
appointed
pursuant
to a
Custodial
Agreement.
Cut-off Date:
September 1, 2006.
Cut-off Date Balance:
$730,000,055.08.
Cut-off Date Principal
Balance:
With respect to any Mortgage Loan, the unpaid principal
balance thereof
at the Cut-off Date after giving
effect to all
installments
of principal
due on or prior thereto (or due in the
month of the Cut-off Date), whether or not received.
Debt Service
Reduction:
With respect to any Mortgage Loan, a reduction in the scheduled
Monthly Payment
for such Mortgage Loan by a court of competent
jurisdiction
in a proceeding
under the
Bankruptcy
Code,
except
such a reduction
constituting a Deficient
Valuation or any reduction
that results in a permanent
forgiveness of
principal.
Deficient
Valuation:
With
respect
to
any
Mortgage
Loan,
a
valuation
by
a
court
of
competent
jurisdiction
of the
Mortgaged
Property
in an
amount
less
than the then
outstanding
indebtedness
under the
Mortgage
Loan,
or any reduction in the amount of principal to be paid in
connection
with any scheduled
Monthly
Payment that
constitutes
a permanent
forgiveness
of
principal,
which
valuation
or reduction
results from a
proceeding under the Bankruptcy Code.
Definitive Certificate:
Any definitive, fully registered Certificate.
Deleted
Mortgage
Loan: A Mortgage Loan replaced or to be replaced with a Qualified
Substitute
Mortgage
Loan.
Delinquent:
As used herein,
a Mortgage
Loan is
considered
to be: "30 to 59 days" or "30 or more days"
delinquent
when a payment due on any
scheduled
due date
remains
unpaid as of the close of business on the next
following
monthly
scheduled due date; "60 to 89 days" or "60 or more days"
delinquent
when a payment due on any
scheduled due date remains unpaid as of the close of business on
the second following
monthly
scheduled due date;
and so on. The
determination
as to whether a Mortgage
Loan falls into these
categories
is made as of the close
of business on the last
business
day of each month.
For
example,
a Mortgage
Loan with a payment due on July 1
that
remained
unpaid
as of the close of
business
on August
31 would
then be
considered
to be 30 to 59 days
delinquent.
Delinquency
information
as of the
Cut-off
Date is
determined
and
prepared
as of the
close
of
business on the last business day immediately prior to the Cut-off
Date.
Depositor:
As defined in the preamble hereto.
Depository:
The Depository
Trust Company,
or any successor
Depository
hereafter named. The nominee of
the initial
Depository for purposes of registering those
Certificates
that are to be Book-Entry
Certificates is
Cede & Co. The
Depository
shall at all times be a "clearing
corporation"
as defined in
Section 8-102(a)(5)
of
the
Uniform
Commercial
Code of the
State
of New
York
and a
"clearing
agency"
registered
pursuant
to the
provisions of Section 17A of the Exchange Act.
Depository
Participant:
A broker,
dealer, bank or other financial
institution or other Person for whom
from
time to time a
Depository
effects
book-entry
transfers
and
pledges
of
securities
deposited
with the
Depository.
Derivative
Contract:
Any ISDA Master
Agreement,
together with the related
Schedule and
Confirmation,
entered into by the Trustee and a Derivative Counterparty in
accordance with Section 4.09.
Derivative Counterparty:
Any counterparty to a Derivative Contract as provided in Section
4.09.
Destroyed
Mortgage
Note: A Mortgage
Note the original of which was
permanently
lost or destroyed
and
has not been replaced.
Determination
Date:
With respect to any
Distribution
Date,
the 20th day (or if such 20th day is not a
Business Day, the Business Day immediately following such 20th day)
of the month of the related Distribution Date.
Disqualified
Organization:
Any
organization
defined
as
a
"disqualified
organization"
under
Section 860E(e)(5)
of the Code,
including,
if not
otherwise
included,
any of the
following:
(i) the
United
States,
any State or
political
subdivision
thereof,
any
possession
of the
United
States,
or any agency or
instrumentality
of any of the
foregoing
(other
than an
instrumentality
which is a
corporation
if all of its
activities
are subject to tax and,
except for Freddie
Mac, a majority of its board of
directors is not selected
by
such
governmental
unit),
(ii) a
foreign
government,
any
international
organization,
or any
agency
or
instrumentality
of any of the
foregoing,
(iii)
any
organization
(other
than
certain
farmers'
cooperatives
described
in
Section 521
of the Code) which is exempt
from the tax imposed by Chapter 1 of the Code
(including
the tax imposed by
Section 511
of the Code on unrelated
business
taxable
income) and
(iv) rural
electric and
telephone cooperatives described in
Section 1381(a)(2)(C)
of the Code. A Disqualified
Organization also includes
any "electing large
partnership," as defined in
Section 775(a)
of the Code and any other Person so designated by
the Trustee
based upon an Opinion of Counsel
that the holding of an Ownership
Interest in a Class R
Certificate
by such Person may cause any REMIC or any Person having an
Ownership Interest in any Class of
Certificates
(other
than such
Person) to incur a liability
for any federal tax
imposed
under the Code that would not
otherwise
be
imposed but for the Transfer of an Ownership
Interest in a Class R
Certificate to such Person.
The terms "United
States,"
"State" and
"international
organization"
shall have the meanings set forth in Section 7701 of the Code
or successor provisions.
Distribution
Date:
The 25th day of any month
beginning
in
October
2006 or, if such 25th day is not a
Business Day, the Business Day immediately following such 25th day.
DTC Letter:
The Letter of
Representations,
dated September 27, 2006, among the Trustee on behalf of the
Trust Fund, U.S. Bank National Association, in its individual
capacity as agent thereunder and the Depository.
Due Date:
With respect to any
Distribution
Date and any Mortgage
Loan,
the day during the related Due
Period on which the Monthly Payment is due.
Due Period:
With respect to any Distribution Date, the calendar month of such
Distribution Date.
Eligible Account:
An account that is any of the following:
(i) maintained with a depository
institution
the debt
obligations
of which have been rated by each Rating Agency in its highest
rating
available,
or (ii) an
account
or
accounts
in a
depository
institution
in which
such
accounts
are
fully
insured
to the
limits
established by the FDIC,
provided that any deposits not so insured shall, to the extent
acceptable to each Rating
Agency,
as evidenced in writing,
be maintained such that (as evidenced by an Opinion of Counsel
delivered to the
Trustee and each Rating Agency) the registered
Holders of
Certificates
have a claim with respect to the funds in
such account or a perfected
first security
interest
against any collateral
(which shall be limited to Permitted
Investments)
securing
such
funds
that is
superior
to claims
of any
other
depositors
or
creditors
of the
depository
institution
with which such account is maintained,
or (iii) in the case of the Custodial
Account,
a
trust account or accounts maintained in the corporate trust
department of U.S. Bank National
Association,
or (iv)
in the case of the Certificate
Account,
a trust account or accounts
maintained in the corporate trust department
of U.S. Bank National
Association,
or (v) an account or accounts of a depository
institution
acceptable to each
Rating
Agency (as
evidenced
in writing
by each
Rating
Agency
that use of any such
account as the
Custodial
Account or the
Certificate
Account
will not reduce the rating
assigned
to any
Class of
Certificates
by such
Rating Agency below the then-current rating assigned to such
Certificates by such Rating Agency).
Eligible Master Servicing
Compensation:
With respect to any
Distribution
Date and each Loan Group, the
lesser of
(a) one-twelfth
of 0.125% of the Stated
Principal
Balance of the related
Mortgage Loans
immediately
preceding
such
Distribution
Date and (b) the sum of the Servicing Fee and all income and gain
on amounts held in
the
Custodial
Account and the
Certificate
Account and payable to the
Certificateholders
with
respect to such
Distribution
Date,
in each case with
respect to the
related
Loan
Group;
provided
that for
purposes of this
definition
the
amount of the
Servicing
Fee will not be reduced
pursuant
to
Section 7.02(a)
except as may be
required pursuant to the last sentence of such Section.
ERISA:
The Employee Retirement Income Security Act of 1974, as amended.
Event of Default:
As defined in Section 7.01.
Excess Cash Flow:
With
respect to any
Distribution
Date,
an amount equal to the sum of (A) the excess
of (i) the
Available
Distribution
Amount
for that
Distribution
Date
over
(ii)
the sum of (a) the
Interest
Distribution
Amount
for that
Distribution
Date and (b) the lesser of (1) the
aggregate
Certificate
Principal
Balance of Class A
Certificates and Class M
Certificates
immediately prior to such Distribution Date and (2) the
Principal
Remittance
Amount for that
Distribution
Date to the extent not applied to pay interest on the Class A
Certificates and Class M
Certificates on such Distribution Date, (B) the
Overcollateralization
Reduction Amount,
if any, for that
Distribution
Date and (C) any Yield
Maintenance
Agreement
Payment received by the Trustee for
that Distribution Date.
Excess
Overcollateralization
Amount:
With respect to any Distribution
Date, the excess, if any, of (a)
the Overcollateralization
Amount on such Distribution Date over (b) the Required
Overcollateralization Amount for
such Distribution Date.
Exchange Act:
The Securities Exchange Act of 1934, as amended.
Expense
Fee Rate:
With
respect to any
Mortgage
Loan as of any date of
determination,
the sum of the
applicable Servicing Fee Rate and the per annum rate at which the
applicable Subservicing Fee accrues.
Fannie Mae:
Fannie Mae, a federally
chartered and
privately
owned
corporation
organized and existing
under the Federal National Mortgage Association Charter Act, or any
successor thereto.
FDIC:
Federal Deposit Insurance Corporation or any successor thereto.
Final
Distribution
Date:
The
Distribution
Date on which
the final
distribution
in
respect
of the
Certificates will be made pursuant to Section 9.01,
which Final
Distribution Date shall in no event be later than
the end of the 90-day liquidation period described in Section 9.02.
Final
Scheduled
Distribution
Date:
Solely for
purposes of the face of the
Certificates,
as follows:
with respect to the
Class A-I-1
Certificates,
the
Distribution
Date occurring in May 2030; with respect to the
Class A-I-2
Certificates,
the
Distribution
Date
occurring
in April
2035;
with
respect
to the
Class A-I-3
Certificates,
the
Distribution
Date occurring in August 2036; and with respect to the Class A-I-4
Certificates,
Class A-II
Certificates and each Class of Class M
Certificates,
the Distribution Date occurring in October 2036.
No event of
default
under
this
Agreement
will arise or become
applicable
solely by reason of the
failure to
retire the entire
Certificate
Principal Balance of any Class of Class A
Certificates or Class M
Certificates on
or before its Final Scheduled Distribution Date.
Fitch:
Fitch Ratings, or its successors in interest.
Foreclosure
Profits:
With
respect
to any
Distribution
Date or
related
Determination
Date
and any
Mortgage
Loan,
the excess,
if any, of
Liquidation
Proceeds,
Insurance
Proceeds and REO Proceeds
(net of all
amounts reimbursable
therefrom pursuant to
Section 3.10(a)(ii))
in respect of each Mortgage Loan or REO Property
for which a Cash
Liquidation
or REO
Disposition
occurred in the related
Prepayment
Period over the sum of the
unpaid principal balance of such Mortgage Loan or REO Property
(determined,
in the case of an REO Disposition,
in
accordance
with
Section 3.14)
plus
accrued and unpaid
interest at the Mortgage
Rate on such unpaid
principal
balance
from the Due
Date to which
interest
was
last
paid by the
Mortgagor
to the
first
day of the
month
following the month in which such Cash Liquidation or REO
Disposition occurred.
Form 10-K Certification:
As defined in Section 4.03(e).
Freddie Mac:
Freddie Mac, a corporate
instrumentality
of the United States
created and existing
under
Title III of the Emergency Home Finance Act of 1970, as amended, or
any successor thereto.
Group I Basis Risk Shortfall:
With respect to any Class of Class A-I
Certificates
and any
Distribution
Date, an amount equal to the excess of (x) Accrued
Certificate
Interest for that Class
calculated at a per annum
rate (which shall not exceed 14.000% per annum) equal to LIBOR plus
the related Margin for that
Distribution
Date
over
(y) Accrued
Certificate
Interest
for that Class if the
Pass-Through
Rate for that
Distribution
Date is
calculated
using the Group I
Net WAC Cap Rate for that
Distribution
Date;
plus any unpaid
Group I
Basis Risk
Shortfall from prior
Distribution
Dates,
plus interest thereon to the extent
previously
unreimbursed by Excess
Cash Flow
calculated
at a per annum rate
(which
shall not
exceed
14.000%
per annum)
equal to LIBOR plus the
related Margin for that Distribution Date.
Group I Loans:
The Mortgage
Loans
designated on the Mortgage Loan Schedule
attached
hereto as Exhibit
F-1.
The Group I Loans relate to the Class A-I Certificates, Class M
Certificates and Class SB Certificates.
Group I Net WAC Cap Rate:
With
respect to any
Distribution
Date, a per annum rate equal to the product
of (i) the weighted
average of the Net Mortgage Rates (or, if applicable,
the Modified Net Mortgage Rates) on the
Group I Loans using the Net Mortgage Rates (or, if applicable,
the Modified Net Mortgage
Rates) in effect for the
Monthly
Payments
due on such
Mortgage
Loans
during
the
related
Due
Period,
weighted
on the
basis of the
respective
Stated Principal
Balances thereof for that
Distribution
Date and (ii) a fraction equal to 30 divided
by the actual number of days in the related Interest Accrual
Period.
Group I
Principal
Distribution
Amount:
For any
Distribution
Date,
the
product of
(x) the
Class A
Principal
Distribution
Amount
for that
Distribution
Date and (y) a
fraction,
the
numerator
of which is the
portion of the Principal
Allocation
Amount related to Loan Group I for that Distribution Date and the
denominator
of which is the Principal Allocation Amount for all of the Mortgage
Loans for that Distribution Date.
Group II
Basis
Risk
Shortfall:
With
respect
to
any
Class
of
Class A-II
Certificates
and
any
Distribution Date, an amount equal to the excess of (x) Accrued
Certificate
Interest for that Class calculated at
a per annum
rate
(which
shall not exceed
14.000%
per annum)
equal to LIBOR plus the
related
Margin for that
Distribution
Date
over
(y) Accrued
Certificate
Interest
for
that
Class
if the
Pass-Through
Rate for such
Distribution
Date is calculated
using the Group II Net WAC Cap Rate for that
Distribution
Date; plus any unpaid
Group II
Basis Risk
Shortfall
from prior
Distribution
Dates,
plus interest
thereon to the extent
previously
unreimbursed
by Excess Cash Flow
calculated at a per annum rate (which shall not exceed
14.000% per annum) equal
to LIBOR plus the related Margin for that Distribution Date.
Group II
Loans:
The Mortgage Loans
designated on the Mortgage Loan Schedule
attached hereto as Exhibit
F-2.
The Group II Loans relate to the Class A-II Certificates, Class M
Certificates and Class SB Certificates.
Group II Net WAC Cap Rate:
With respect to any
Distribution
Date, a per annum rate equal to the product
of (i) the weighted
average of the Net Mortgage Rates (or, if applicable,
the Modified Net Mortgage Rates) on the
Group II
Loans using the Net Mortgage
Rates (or, if
applicable,
the Modified Net Mortgage
Rates) in effect for
the Monthly
Payments
due on such
Mortgage
Loans
during the
related
Due Period,
weighted on the basis of the
respective
Stated Principal
Balances thereof for that
Distribution
Date and (ii) a fraction equal to 30 divided
by the actual number of days in the related Interest Accrual
Period.
Group II
Principal
Distribution
Amount:
For any
Distribution
Date,
the
product of (x) the
Class A
Principal
Distribution
Amount
for that
Distribution
Date and (y) a
fraction,
the
numerator
of which is the
portion
of the
Principal
Allocation
Amount
related
to
Loan
Group II
for
that
Distribution
Date
and the
denominator of which is the Principal Allocation Amount for all of
the Mortgage Loans for that Distribution Date.
HUD:
The United States Department of Housing and Urban Development.
Independent:
When used with
respect
to any
specified
Person,
means
such a Person who (i) is in fact
independent of the Depositor,
the Master Servicer and the Trustee,
or any Affiliate
thereof,
(ii) does not have
any direct financial
interest or any material indirect
financial
interest in the Depositor,
the Master Servicer
or the Trustee or in an Affiliate
thereof,
and (iii) is not connected with the Depositor,
the Master Servicer or
the Trustee as an
officer,
employee,
promoter,
underwriter,
trustee,
partner,
director or person
performing
similar functions.
Index:
With respect to any
adjustable-rate
Mortgage Loan and as to any Adjustment
Date
therefor,
the
related index as stated in the related Mortgage Note.
Initial
Certificate
Principal
Balance:
With
respect to each
Class of
Certificates
(other
than the
Class R
Certificates),
the Certificate
Principal Balance of such Class of Certificates as of the Closing
Date as
set forth in the Preliminary Statement hereto.
Insurance
Proceeds:
Proceeds
paid in respect of the Mortgage
Loans
pursuant to any Primary
Insurance
Policy or any other related
insurance
policy covering a Mortgage Loan, to the extent such proceeds are
payable to
the mortgagee under the Mortgage,
any
Subservicer,
the Master Servicer or the Trustee and are not applied to the
restoration of the related
Mortgaged
Property or released to the Mortgagor in accordance with the
procedures that
the Master Servicer would follow in servicing mortgage loans held
for its own account.
Interest
Accrual Period:
With respect to the
Distribution
Date in October 2006, the period
commencing
the Closing Date and ending on the day preceding
the
Distribution
Date in October 2006,
and with respect to any
Distribution
Date after the Distribution
Date in October 2006, the period
commencing on the Distribution Date in
the month
immediately
preceding the month in which such
Distribution Date occurs and ending on the day preceding
such Distribution Date.
Interest
Distribution
Amount:
For
any
Distribution
Date,
the
amounts
payable
pursuant
to
Section 4.02(c)(i) and (ii).
Interim Certification:
As defined in Section 2.02.
Late
Collections:
With
respect to any
Mortgage
Loan,
all
amounts
received
during any Due
Period,
whether as late payments of Monthly Payments or as Insurance
Proceeds,
Liquidation
Proceeds or otherwise,
which
represent
late payments or
collections
of Monthly
Payments due but delinquent for a previous Due Period and not
previously recovered.
LIBOR:
With respect to any Distribution
Date, the arithmetic mean of the London
interbank
offered rate
quotations
for one-month
U.S.
Dollar
deposits,
expressed on a per annum basis,
determined in accordance
with
Section 1.02.
LIBOR
Business
Day:
Any day
other
than
(i) a
Saturday
or
Sunday
or (ii) a day on
which
banking
institutions in London, England are required or authorized by law
to be closed.
LIBOR Certificates:
Collectively, the Class A Certificates and Class M Certificates.
LIBOR Rate
Adjustment
Date:
With
respect to each
Distribution
Date,
the second
LIBOR
Business Day
immediately preceding the commencement of the related Interest
Accrual Period.
Limited Repurchase Right Holder:
RFC Asset Holdings II, Inc., or its successor.
Liquidation
Proceeds:
Amounts
(other
than
Insurance
Proceeds)
received
by the Master
Servicer
in
connection
with the
taking of an
entire
Mortgaged
Property
by
exercise
of the
power of
eminent
domain or
condemnation
or in
connection
with
the
liquidation
of a
defaulted
Mortgage
Loan
through
trustee's
sale,
foreclosure sale or otherwise, other than REO Proceeds and
Subsequent Recoveries.
Loan Group:
Loan Group I or Loan Group II, as applicable.
Loan Group I:
The Mortgage
Loans
designated on the Mortgage
Loan Schedule
attached
hereto as Exhibit
F-1.
Loan Group II:
The Mortgage
Loans
designated on the Mortgage Loan Schedule
attached
hereto as Exhibit
F-2.
Loan-to-Value
Ratio: As of any date, the fraction,
expressed as a percentage,
the numerator of which is
the current
principal
balance of the related
Mortgage Loan at the date of
determination
and the denominator of
which is the Appraised Value of the related Mortgaged Property.
Margin: The Class A-I-1 Margin,
Class A-I-2 Margin,
Class A-I-3 Margin,
Class A-I-4 Margin,
Class A-II
Margin,
Class M-1 Margin,
Class M-2
Margin,
Class M-3 Margin,
Class M-4
Margin,
Class M-5 Margin,
Class M-6
Margin, Class M-7 Margin, Class M-8 Margin or Class M-9 Margin, as
applicable.
Marker Rate: With respect to the Class SB
Certificates or the SB-IO
REMIC III
Regular
Interest and any
Distribution
Date, in relation to the REMIC II
Regular
Interests
LT1, LT2, LT3, LT4 and LT-Y1, 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. With respect to the Class SB
Certificates
or the SB-IO
REMIC III
Regular
Interest and any
Distribution
Date, in relation to the REMIC II
Regular
Interests LT5, LT6,
LT7, LT8 and LT-Y2,
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 LT6 and REMIC II
Regular Interest LT7.
Master Servicer:
As defined in the preamble hereto.
Maturity Date:
With respect to each Class of
Certificates
representing
ownership of REMIC I,
REMIC II
or
REMIC III
Regular
Interests
or
Uncertificated
Regular
Interests
issued by each of REMIC I,
REMIC II and
REMIC III the latest possible
maturity date,
solely for purposes of
Section 1.860G-1(a)(4)(iii)
of the Treasury
Regulations,
by which the Certificate Principal Balance of each such Class of
Certificates
representing a regular
interest in the Trust Fund would be reduced to zero,
which is, for each such regular
interest,
October 25, 2036,
which is the
Distribution
Date
occurring
in the month
following
the last
scheduled
monthly
payment
of the
Mortgage Loans.
Maximum
Mortgage Rate:
With respect to any
adjustable-rate
Mortgage Loan, the per annum rate indicated
on the
Mortgage
Loan
Schedule
as the
"NOTE
CEILING,"
which
rate is the
maximum
interest
rate that may be
applicable to such Mortgage Loan at any time during the life of
such Mortgage Loan.
MERS:
Mortgage
Electronic
Registration
Systems,
Inc., a corporation
organized and existing under the
laws of the State of Delaware, or any successor thereto.
MERS(R)System:
The system of recording transfers of Mortgages electronically
maintained by MERS.
MIN:
The Mortgage Identification Number for Mortgage Loans registered
with MERS on the MERS(R)System.
Minimum
Mortgage Rate: With respect to any
adjustable-rate
Mortgage Loan, a per annum rate equal to the
greater of (i) the
Note Margin and (ii) the rate
indicated
on the Mortgage
Loan
Schedule as the "NOTE
FLOOR,"
which rate may be applicable to such Mortgage Loan at any time
during the life of such Mortgage Loan.
Modified Mortgage Loan:
Any Mortgage Loan that has been the subject of a Servicing
Modification.
Modified
Net
Mortgage
Rate:
With
respect to any
Mortgage
Loan that is the
subject
of a
Servicing
Modification,
the Net Mortgage
Rate minus the rate per annum by which the Mortgage Rate on such
Mortgage Loan was
reduced.
MOM Loan:
With respect to any Mortgage Loan,
MERS acting as the mortgagee of such Mortgage Loan,
solely
as nominee for the originator of such Mortgage Loan and its
successors and assigns, at the origination thereof.
Monthly
Payment:
With respect to any Mortgage Loan
(including any REO Property) and the Due Date in any
Due Period,
the payment of principal and interest due thereon in accordance
with the amortization
schedule at the
time applicable thereto (after adjustment,
if any, for Curtailments and for Deficient
Valuations
occurring prior
to such Due Date but before any adjustment to such
amortization
schedule by reason of any bankruptcy,
other than
a Deficient
Valuation,
or similar
proceeding or any
moratorium or similar waiver or grace period and before any
Servicing Modification that constitutes a reduction of the interest
rate on such Mortgage Loan).
Moody's:
Moody's Investors Service, Inc., or its successors in interest.
Mortgage:
With
respect
to
each
Mortgage
Note,
the
mortgage,
deed of
trust
or
other
comparable
instrument
creating
a first or junior
lien on an estate in fee simple or
leasehold
interest
in real
property
securing a Mortgage Note.
Mortgage File: The mortgage
documents
listed in
Section 2.01
pertaining to a particular
Mortgage Loan
and any additional documents required to be added to the Mortgage
File pursuant to this Agreement.
Mortgage
Loans:
Such
of the
mortgage
loans
transferred
and
assigned
to the
Trustee
pursuant
to
Section 2.01
as from time to time are held or deemed to be held as a part of the
Trust Fund,
the
Mortgage
Loans
originally
so held being
identified in the initial
Mortgage Loan
Schedule,
and Qualified
Substitute
Mortgage
Loans held or deemed held as part of the Trust Fund
including,
without
limitation,
each related
Mortgage Note,
Mortgage and Mortgage File and all rights appertaining thereto.
Mortgage Loan Schedule:
The lists of the Mortgage Loans
attached
hereto as Exhibit F-1
and Exhibit F-2
(as amended from time to time to reflect the addition of Qualified
Substitute
Mortgage Loans),
which lists shall
set forth at a minimum the following information as to each
Mortgage Loan:
(i)
the Mortgage Loan identifying number ("RFC LOAN #");
(ii)
[reserved];
(iii)
the maturity of the Mortgage Note ("MATURITY
DATE," or "MATURITY DT");
(iv)
for the adjustable-rate Mortgage Loans, the Mortgage Rate as of
origination ("ORIG RATE");
(v)
the Mortgage Rate as of the Cut-off Date ("CURR RATE");
(vi)
the Net Mortgage Rate as of the Cut-off Date ("CURR NET");
(vii)
the scheduled
monthly
payment of principal,
if any, and interest as of the Cut-off Date
("ORIGINAL P &
I" or "CURRENT P & I");
(viii)
the Cut-off Date Principal Balance ("PRINCIPAL BAL");
(ix)
the Loan-to-Value Ratio at origination ("LTV");
(x)
a code "T," "BT" or "CT" under the column "LN
FEATURE,"
indicating
that the Mortgage Loan is secured by
a second or vacation
residence
(the absence of any such code means the Mortgage Loan is secured by
a primary residence);
(xi)
a code "N" under the column
"OCCP
CODE,"
indicating
that the
Mortgage
Loan is secured by a non-owner
occupied
residence
(the
absence of any such code means the
Mortgage
Loan is secured by an owner
occupied residence);
(xii)
for the adjustable-rate Mortgage Loans, the Maximum Mortgage Rate
("NOTE CEILING");
(xiii)
for the adjustable-rate Mortgage Loans, the maximum Net Mortgage
Rate ("NET CEILING");
(xiv)
for the adjustable-rate Mortgage Loans, the Note Margin ("NOTE
MARGIN");
(xv)
for the
adjustable-rate
Mortgage Loans,
the first
Adjustment Date after the Cut-off Date ("NXT INT CHG
DT");
(xvi)
for the adjustable-rate Mortgage Loans, the Periodic Cap ("PERIODIC
DECR" or "PERIODIC INCR");
(xvii)
[reserved]; and
(xviii)
for the
adjustable-rate
Mortgage
Loans,
the rounding of the
semi-annual
or annual
adjustment to the
Mortgage Rate ("NOTE METHOD").
Such
schedules
may
consist of
multiple
reports
that
collectively
set forth all of the
information
required.
Mortgage
Note:
The
originally
executed
note
or
other
evidence
of
indebtedness
evidencing
the
indebtedness of a Mortgagor under a Mortgage Loan, together with
any modification thereto.
Mortgage Rate:
With respect to any Mortgage
Loan, the interest rate borne by the related
Mortgage Note,
or any
modification
thereto
other
than a
Servicing
Modification.
The
Mortgage
Rate on the
adjustable-rate
Mortgage
Loans
will
adjust
on each
Adjustment
Date to equal
the sum
(rounded
to the
nearest
multiple
of
one-eighth of one percent (0.125%) or up to the nearest one-eighth
of one percent,
which are indicated by a "U" on
the Mortgage Loan Schedule,
except in the case of the
adjustable-rate
Mortgage Loans
indicated by an "X" on the
Mortgage Loan Schedule under the heading "NOTE
METHOD"),
of the related Index plus the Note Margin,
in each case
subject to the applicable Periodic Cap, Maximum Mortgage Rate and
Minimum Mortgage Rate.
Mortgaged Property:
The underlying real property securing a Mortgage Loan.
Mortgagor:
The obligor on a Mortgage Note.
Net Mortgage
Rate:
With respect to any Mortgage Loan as of any date of
determination,
a per annum rate
equal to the Mortgage Rate for such Mortgage Loan as of such date
minus the related Expense Fee Rate.
Net WAC Cap Rate:
The
Group I Net WAC Cap Rate,
Group II
Net WAC Cap Rate or Class M Net WAC Cap Rate,
as applicable.
Non-United States Person:
Any Person other than a United States Person.
Nonrecoverable
Advance:
Any Advance
previously
made or
proposed to be made by the Master
Servicer or
Subservicer in respect of a Mortgage Loan (other than a Deleted
Mortgage
Loan) which,
in the good faith judgment
of the Master Servicer,
will not, or, in the case of a proposed Advance,
would not, be ultimately
recoverable by
the Master Servicer from related Late Collections,
Insurance Proceeds,
Liquidation
Proceeds or REO Proceeds.
To
the extent that any
Mortgagor is not
obligated
under the related
Mortgage
documents
to pay or
reimburse
any
portion of any Servicing
Advances that are outstanding
with respect to the related Mortgage Loan as a result of a
modification
of such Mortgage Loan by the Master
Servicer,
which forgives
amounts which the Master
Servicer or
Subservicer
had
previously
advanced,
and the
Master
Servicer
determines
that no other
source of payment or
reimbursement
for such advances is available to it, such Servicing
Advances shall be deemed to be
Nonrecoverable
Advances.
The
determination by the Master Servicer that it has made a
Nonrecoverable
Advance shall be evidenced
by a
certificate
of a Servicing
Officer,
Responsible
Officer or Vice
President
or its
equivalent
or senior
officer of the Master
Servicer,
delivered to the Depositor,
the Trustee,
and the Master Servicer
setting forth
such
determination,
which shall include any other
information or reports obtained by the Master Servicer such as
property operating statements,
rent rolls, property inspection reports and engineering reports,
which may support
such
determinations.
Notwithstanding
the above, the Trustee shall be entitled to rely upon any
determination by
the Master Servicer that any Advance previously made is a
Nonrecoverable
Advance or that any proposed Advance,
if
made, would constitute a Nonrecoverable Advance.
Nonsubserviced
Mortgage
Loan: Any Mortgage Loan that, at the time of reference
thereto,
is not subject
to a Subservicing Agreement.
Note Margin:
With respect to each
adjustable-rate
Mortgage Loan, the fixed
percentage set forth in the
related
Mortgage Note and indicated on the Mortgage Loan Schedule as the
"NOTE MARGIN," which
percentage is added
to the Index on each
Adjustment
Date to determine
(subject to rounding in accordance
with the related
Mortgage
Note, the Periodic Cap, the Maximum
Mortgage Rate and the Minimum
Mortgage Rate) the interest rate to be borne by
such adjustable-rate Mortgage Loan until the next Adjustment Date.
Notional
Amount:
With
respect to the Class SB
Certificates
or the REMIC II
Regular
Interest
SB-IO,
immediately prior to any Distribution Date, the aggregate of the
Uncertificated
Principal Balances of the REMIC I
Regular Interests.
Officers'
Certificate:
A
certificate
signed
by the
Chairman
of the
Board,
the
President,
a Vice
President,
Assistant Vice President,
Director,
Managing
Director,
the Treasurer,
the Secretary,
an Assistant
Treasurer or an Assistant
Secretary of the Depositor or the Master Servicer,
as the case may be, and delivered to
the Trustee, as required by this Agreement.
Opinion of Counsel:
A written
opinion of counsel
acceptable to the Trustee and the Master
Servicer and
which
counsel may be counsel for the
Depositor or the Master
Servicer,
provided that any Opinion of Counsel (i)
referred to in the definition of
"Disqualified
Organization"
or (ii) relating to the
qualification of any REMIC
hereunder as a REMIC or compliance with the REMIC Provisions must,
unless
otherwise
specified,
be an opinion of
Independent counsel.
Optional
Termination
Date: Any Distribution
Date on or after which the Stated Principal
Balance (after
giving effect to distributions to be made on such
Distribution
Date) of the Mortgage Loans is less than 10.00% of
the Cut-off Date Balance.
Outstanding
Mortgage
Loan:
With respect to the Due Date in any Due Period,
a Mortgage Loan
(including
an REO Property) that was not the subject of a Principal
Prepayment in Full,
Cash
Liquidation or REO Disposition
and that was not
purchased,
deleted or
substituted
for prior to such Due Date pursuant to
Section 2.02,
2.03,
2.04 or 4.07.
Overcollateralization
Amount:
With
respect to any
Distribution
Date,
the excess,
if any, of (a) the
aggregate Stated
Principal
Balance of the Mortgage Loans before giving effect to distributions
of principal to be
made on such Distribution
Date over (b) the aggregate
Certificate
Principal Balance of the Class A
Certificates
and Class M Certificates immediately prior to such date.
Overcollateralization Floor:
An amount equal to the product of 0.50% and the Cut-off Date
Balance.
Overcollateralization
Increase Amount:
With respect to any
Distribution
Date, the lesser of (a) Excess
Cash Flow for that
Distribution
Date (to the extent not used to cover the amounts
described
in clauses (iv) and
(v) of the
definition of Principal
Distribution
Amount as of such
Distribution
Date) and (b) the excess of (1)
the Required
Overcollateralization
Amount for such
Distribution Date over (2) the
Overcollateralization
Amount
for such Distribution Date.
Overcollateralization
Reduction
Amount:
With
respect
to any
Distribution
Date on which
the
Excess
Overcollateralization
Amount
is,
after
taking
into
account
all
other
distributions
to
be
made
on
such
Distribution
Date, greater than zero, the
Overcollateralization
Reduction Amount shall be equal to the lesser of
(i) the Excess
Overcollateralization
Amount for that Distribution
Date and (ii) the Principal
Remittance Amount
on such Distribution Date.
Ownership
Interest:
With
respect
to any
Certificate,
any
ownership
or
security
interest
in such
Certificate,
including any interest in such
Certificate
as the Holder
thereof and any other
interest
therein,
whether direct or indirect, legal or beneficial, as owner or as
pledgee.
Pass-Through
Rate: With respect to each Class of Class A
Certificates
and Class M
Certificates and any
Distribution
Date, the least of (i) a per annum rate equal to LIBOR plus the
related Margin for such
Distribution
Date, (ii) 14.000% per annum and (iii) the related Net WAC Cap Rate
for such Distribution Date.
With respect to the Class SB
Certificates
and any
Distribution
Date or the REMIC III
Regular Interest
SB-IO, a per annum rate equal to the percentage equivalent of a
fraction,
the numerator of which is the sum of the
amounts
calculated
pursuant to clauses (i) through
(viii) below,
and the
denominator of which is the aggregate
principal
balance of the REMIC II Regular
Interests.
For purposes of calculating the
Pass-Through
Rate for the
Class SB
Certificates or the SB-IO REMIC III Regular Interest,
the numerator is equal to the sum of the following
components:
(i)
the
Uncertificated
Pass-Through
Rate for
REMIC II
Regular
Interest
LT1
minus the
related
Marker
Rate,
applied to a notional
amount
equal to the
Uncertificated
Principal
Balance of
REMIC II Regular Interest LT1;
(ii)
the
Uncertificated
Pass-Through
Rate for
REMIC II
Regular
Interest
LT2
minus the
related
Marker
Rate,
applied to a notional
amount
equal to the
Uncertificated
Principal
Balance of
REMIC II Regular Interest LT2;
(iii)
the
Uncertificated
Pass-Through Rate for REMIC II Regular Interest LT4 minus twice the
related
Marker
Rate,
applied to a notional
amount
equal to the
Uncertificated
Principal
Balance of
REMIC II Regular Interest LT4;
(iv)
the
Uncertificated
Pass-Through
Rate for
REMIC II
Regular
Interest
LT5
minus the
related
Marker
Rate,
applied to a notional
amount
equal to the
Uncertificated
Principal
Balance of
REMIC II Regular Interest LT5;
(v)
the
Uncertificated
Pass-Through
Rate for
REMIC II
Regular
Interest
LT6
minus the
related
Marker
Rate,
applied to a notional
amount
equal to the
Uncertificated
Principal
Balance of
REMIC II Regular Interest LT6;
(vi)
the
Uncertificated
Pass-Through Rate for REMIC II Regular Interest LT8 minus twice the
related
Marker
Rate,
applied to a notional
amount
equal to the
Uncertificated
Principal
Balance of
REMIC II Regular Interest LT8;
(vii)
the
Uncertificated
Pass-Through
Rate for
REMIC II
Regular
Interest LT Y1 minus the
related
Marker
Rate,
applied to a notional
amount
equal to the
Uncertificated
Principal
Balance of
REMIC II Regular Interest LT-Y1; and
(viii)
the
Uncertificated
Pass-Through
Rate for
REMIC II
Regular
Interest LT Y2 minus the
related
Marker
Rate,
applied to a notional
amount
equal to the
Uncertificated
Principal
Balance of
REMIC II Regular Interest LT-Y2.
Paying Agent:
U.S. Bank National Association or any successor Paying Agent
appointed by the Trustee.
Percentage
Interest:
With
respect to any Class A
Certificate
or Class M
Certificate,
the
undivided
percentage
ownership
interest in the related
Class evidenced
by such
Certificate,
which percentage
ownership
interest shall be equal to the Initial
Certificate
Principal
Balance
thereof
divided by the aggregate
Initial
Certificate
Principal
Balance of all of the Certificates of the same Class. The
Percentage
Interest with respect
to a Class SB Certificate or Class R Certificate shall be stated on
the face thereof.
Periodic Cap: With respect to each
adjustable-rate
Mortgage
Loan, the periodic rate cap that limits the
increase or the decrease of the related
Mortgage Rate on any Adjustment
Date pursuant to the terms of the related
Mortgage Note.
Permitted Investments:
One or more of the following:
(i)
obligations
of or
guaranteed as to principal and interest by the United States or any
agency or
instrumentality
thereof
when such
obligations
are
backed by the full faith and credit of the
United States;
(ii)
repurchase
agreements
on
obligations
specified in clause (i) maturing not more than one month
from the date of
acquisition
thereof,
provided
that the
unsecured
obligations
of the party
agreeing
to
repurchase
such
obligations
are at the time rated by each
Rating
Agency in its
highest short-term rating available;
(iii)
federal funds,
certificates of deposit,
demand deposits, time deposits and bankers' acceptances
(which
shall
each
have an
original
maturity
of not more
than 90 days
and,
in the case of
bankers'
acceptances,
shall in no event have an
original
maturity
of more than 365 days or a
remaining
maturity
of more than 30 days)
denominated
in
United
States
dollars
of any U.S.
depository
institution or trust company
incorporated under the laws of the United States or any
state thereof or of any domestic
branch of a foreign
depository
institution
or trust company;
provided that the debt
obligations of such
depository
institution or trust company at the date
of
acquisition
thereof have been rated by each Rating Agency in its highest
short-term
rating
available;
and, provided further that, if the original
maturity of such short-term
obligations
of a domestic branch of a foreign
depository
institution or trust company shall exceed 30 days,
the
short-term
rating of such
institution
shall be A-1+ in the case of
Standard
& Poor's if
Standard & Poor's is a Rating Agency;
(iv)
commercial paper and demand notes (having
original
maturities of not more than 365 days) of any
corporation
incorporated
under the laws of the United
States or any state thereof which on the
date of
acquisition
has been rated by each
Rating
Agency in its
highest
short
term
rating
available;
provided that such commercial paper and demand notes shall have a
remaining
maturity
of not more than 30 days;
(v)
a money
market fund or a qualified
investment
fund rated by each Rating
Agency in its highest
long-term rating available (which may be managed by the Trustee or
one of its Affiliates); and
(vi)
other
obligations
or
securities
that are
acceptable
to each
Rating
Agency as a
Permitted
Investment
hereunder
and will not reduce the rating
assigned to any Class of
Certificates
by
such Rating Agency below the
then-current
rating
assigned to such
Certificates by such Rating
Agency, as evidenced in writing;
provided,
however,
that no instrument shall be a Permitted
Investment if it represents,
either (1) the right to
receive only interest
payments
with respect to the
underlying
debt
instrument or (2) the right to receive both
principal
and interest
payments
derived from
obligations
underlying
such
instrument
and the
principal
and
interest
payments with respect to such
instrument
provide a yield to maturity
greater than 120% of the yield to
maturity at par of such
underlying
obligations.
References
herein to the highest rating
available on unsecured
long-term
debt shall mean AAA in the case of
Standard & Poor's and Aaa in the case of Moody's,
and for
purposes
of this
Agreement,
any
references
herein to the highest
rating
available
on unsecured
commercial
paper and
short-term debt obligations
shall mean the following:
A-1 in the case of Standard & Poor's and P-1 in the case of
Moody's;
provided,
however,
that any Permitted
Investment
that is a short-term
debt
obligation
rated A-1 by
Standard & Poor's must satisfy the following additional
conditions:
(i) the total amount of debt from A-1 issuers
must be
limited
to the
investment
of
monthly
principal
and
interest
payments
(assuming
fully
amortizing
collateral);
(ii)
the
total
amount
of A-1
investments
must not
represent
more
than
20% of the
aggregate
outstanding
Certificate
Principal Balance of the Certificates and each investment must not
mature beyond 30 days;
(iii) the
terms of the debt must have a
predetermined
fixed
dollar
amount of
principal
due at maturity
that
cannot vary; and (iv) if the investments
may be liquidated
prior to their maturity or are being relied on to meet
a certain
yield,
interest
must be tied to a single
interest
rate index plus a single fixed spread (if any) and
must move
proportionately
with that index.
Any Permitted
Investment
may be purchased by or through the Trustee
or its Affiliates.
Permitted
Transferee:
Any Transferee of a Class R
Certificate,
other than a Disqualified
Organization
or Non-United States Person.
Person:
Any
individual,
corporation,
limited
liability
company,
partnership,
joint
venture,
association,
joint-stock
company,
trust,
unincorporated
organization
or government or any agency or political
subdivision thereof.
Prepayment
Assumption:
With
respect
to
the
Class A
Certificates
and
Class M
Certificates,
the
prepayment
assumption to be used for
determining
the accrual of original
issue
discount and premium and market
discount on such
Certificates for federal income tax purposes,
which (a) with respect to the fixed-rate
Mortgage
Loans,
assumes a constant
prepayment rate of one-tenth of 23% per annum of the then
outstanding
Stated Principal
Balance of the
fixed-rate
Mortgage
Loans in the first month of the life of such Mortgage Loans and an
additional
one-tenth of 23% per annum in each month
thereafter
until the tenth month,
and
beginning in the tenth month and
in each month thereafter
during the life of the fixed-rate
Mortgage Loans, a constant
prepayment rate of 23% per
annum each month
("23% HEP") and (b) with
respect to the
adjustable-rate
Mortgage
Loans
assumes a
prepayment
assumption of 2% of the constant
prepayment
rate in month one,
increasing by
approximately
2.545% from month 2
until
month 12,
a constant
prepayment
rate of 30% from month 12 to month 22, a constant
prepayment rate of 50%
from month 23 to month 27, and a constant
prepayment rate of 35%
thereafter,
used for determining the accrual of
original issue discount and premium and market discount on the
Class A
Certificates
and Class M
Certificates for
federal income tax purposes.
The constant
prepayment
rate assumes that the stated
percentage of the outstanding
Stated Principal Balance of the adjustable-rate Mortgage Loans is
prepaid over the course of a year.
Prepayment
Interest
Shortfall:
With respect to any Distribution
Date and any Mortgage Loan (other than
a Mortgage
Loan
relating to an REO
Property)
that was the subject of (a) a Principal
Prepayment in Full during
the related
Prepayment
Period,
an amount equal to the excess of one month's interest at the
related Net Mortgage
Rate (or Modified Net Mortgage Rate in the case of a Modified
Mortgage
Loan) on the Stated
Principal
Balance of
such
Mortgage
Loan over the amount of interest
(adjusted
to the
related Net
Mortgage
Rate (or
Modified
Net
Mortgage Rate in the case of a Modified
Mortgage
Loan)) paid by the Mortgagor for such
Prepayment
Period to the
date of such Principal
Prepayment in Full or (b) a Curtailment
during the prior calendar
month,
an amount equal
to one month's
interest at the related Net Mortgage
Rate (or Modified Net Mortgage Rate in the case of a Modified
Mortgage Loan) on the amount of such Curtailment.
Prepayment
Period:
With respect to any
Distribution
Date,
the calendar
month
preceding the month of
distribution.
Primary
Insurance Policy:
Each primary policy of mortgage
guaranty
insurance as indicated by a numeric
code on the Mortgage Loan Schedule with the exception of code
"A23," "A34" or "A96" under the column "MI CO CODE."
Principal
Allocation
Amount:
With
respect
to any
Distribution
Date,
the sum of (a)
the
Principal
Remittance
Amount for that
Distribution
Date, (b) any Realized Losses covered by amounts included in clause
(iv)
of the
definition
of Principal
Distribution
Amount and (c) the
aggregate
amount of the
principal
portion of
Realized
Losses on the Mortgage
Loans in the calendar
month
preceding
that
Distribution
Date,
to the extent
covered by Excess Cash Flow included in clause (v) of the
definition of Principal
Distribution
Amount;
provided,
however,
that on any
Distribution
Date on which there is
(i) insufficient
Subsequent
Recoveries
to cover all
unpaid Realized
Losses on the Mortgage Loans
described in clause (b) above, in determining the Group I
Principal
Distribution
Amount and the Group II Principal
Distribution
Amount,
Subsequent
Recoveries will be allocated to
the
Class A-I
Certificates
and
Class A-II
Certificates,
pro rata,
based on the
principal
portion of unpaid
Realized
Losses from prior
Distribution
Dates on the Group I Loans and Group II
Loans,
respectively,
and (ii)
insufficient
Excess Cash Flow to cover all Realized
Losses on the Mortgage
Loans
described in clause (c) above,
in determining the Group I
Principal
Distribution
Amount and the Group II
Principal
Distribution
Amount,
the
Excess
Cash Flow
remaining
after
the
allocation
described
in clause
(b)
above or (i) of this
proviso,
as
applicable,
will be allocated to the Class A-I
Certificates and Class A-II
Certificates,
pro rata, based on the
principal
portion of Realized Losses incurred
during the calendar month preceding that
Distribution
Date on the
Group I Loans and Group II Loans, respectively.
Principal
Distribution
Amount:
With respect to any
Distribution
Date, the lesser of (a) the excess of
(x) the sum of (A) the Available
Distribution
Amount and (B) with respect to clauses
(b)(v) and (vi) below,
the
Yield Maintenance
Agreement Payment for that Distribution
Date, over (y) the Interest
Distribution
Amount,
and
(b) the sum of:
(i)
the
principal
portion of each
Monthly
Payment
received
or Advanced
with
respect to the related Due
Period on each Outstanding Mortgage Loan;
(ii)
the Stated Principal
Balance of any Mortgage Loan repurchased
during the related
Prepayment
Period (or
deemed to have been so
repurchased in accordance
with
Section 3.07(b))
pursuant to
Section 2.02,
2.03, 2.04 or 4.07 and the amount of any shortfall
deposited in the Custodial
Account in connection
with the
substitution
of a Deleted
Mortgage
Loan
pursuant
to
Section 2.03
or 2.04
during the
related Prepayment Period;
(iii)
the principal
portion of all other
unscheduled
collections,
other than Subsequent
Recoveries,
on the
Mortgage
Loans
(including,
without
limitation,
Principal
Prepayments
in
Full,
Curtailments,
Insurance
Proceeds,
Liquidation
Proceeds and REO Proceeds)
received during the related Prepayment
Period
(or
deemed to have been so
received)
to the
extent
applied
by the
Master
Servicer
as
recoveries of principal of the Mortgage Loans pursuant to Section
3.14;
(iv)
the lesser of (1) Subsequent
Recoveries for such
Distribution
Date and (2) the principal portion of any
Realized Losses
allocated to any Class of Certificates
on a prior
Distribution
Date and remaining
unpaid;
(v)
the lesser of (1) the
Excess
Cash Flow for such
Distribution
Date (to the extent not used
pursuant to
clause
(iv) of this
definition
on such
Distribution
Date) and (2) the
principal
portion of any
Realized
Losses
incurred (or deemed to have been
incurred)
on any Mortgage
Loans in the calendar
month preceding such Distribution Date; and
(vi)
the lesser of (1) the Excess
Cash Flow for that
Distribution
Date (to the extent not used
pursuant
to
clauses
(iv)
and
(v)
of
this
definition
on
such
Distribution
Date)
and
(2)
the
Overcollateralization Increase Amount for such Distribution Date;
minus
(vii)
(A) the
amount of any
Overcollateralization
Reduction
Amount
for such
Distribution
Date and (B) the
amount of any Capitalization Reimbursement Amount for such
Distribution Date.
Principal
Prepayment:
Any
payment of
principal
or other
recovery
on a Mortgage
Loan,
including
a
recovery that takes the form of
Liquidation
Proceeds or Insurance
Proceeds,
which is received in advance of its
scheduled
Due Date and is not
accompanied
by an amount as to interest
representing
scheduled
interest on such
payment due on any date or dates in any month or months subsequent
to the month of prepayment.
Principal
Prepayment
in Full:
Any
Principal
Prepayment
made by a Mortgagor
of the entire
principal
balance of a Mortgage Loan.
Principal
Remittance
Amount:
With respect to any
Distribution
Date, all amounts
described in clauses
(b)(i) through (iii) of the definition of Principal Distribution
Amount for that Distribution Date.
Program Guide:
The AlterNet
Seller Guide as incorporated
into the Residential
Funding Seller Guide for
mortgage
collateral sellers that participate in Residential
Funding's AlterNet Mortgage Program,
and Residential
Funding's
Servicing
Guide and any other
subservicing
arrangements
which
Residential
Funding has
arranged to
accommodate the servicing of the Mortgage Loans and in each case
all supplements and amendments
thereto
published
by Residential Funding.
Purchase
Price:
With
respect
to any
Mortgage
Loan
(or REO
Property)
required
to be or
otherwise
purchased on any date pursuant to
Section 2.02,
2.03, 2.04 or 4.07, an amount equal to the sum of (i) 100% of the
Stated Principal
Balance thereof plus the principal portion of any related
unreimbursed
Advances and (ii) unpaid
accrued
interest
at either
(a) the
Adjusted
Mortgage
Rate (or
Modified
Net
Mortgage
Rate in the case of a
Modified
Mortgage Loan) plus the rate per annum at which the Servicing Fee
is calculated,
or (b) in the case of a
purchase
made by the Master
Servicer,
at the Net Mortgage
Rate (or Modified Net Mortgage
Rate in the case of a
Modified
Mortgage
Loan),
in each case on the
Stated
Principal
Balance
thereof
to the first day of the month
following the month of purchase from the Due Date to which
interest was last paid by the
Mortgagor.
With respect
to
any
Mortgage
Loan
(or
REO
Property)
required
to be or
otherwise
purchased
on
any
date
pursuant
to
Section 4.08,
an amount equal to the greater of (i) the sum of (a) 100% of the
Stated
Principal
Balance
thereof
plus the
principal
portion of any related
unreimbursed
Advances of such Mortgage Loan (or REO Property) and (b)
unpaid
accrued
interest at either (1) the Adjusted
Mortgage Rate (or Modified Net Mortgage Rate in the case of a
Modified
Mortgage Loan) plus the rate per annum at which the Servicing Fee
is calculated,
or (2) in the case of a
purchase
made by the Master
Servicer,
at the Net Mortgage
Rate (or Modified Net Mortgage
Rate in the case of a
Modified
Mortgage
Loan),
in each case on the
Stated
Principal
Balance
thereof
to the first day of the month
following the month of purchase from the Due Date to which
interest was last paid by the
Mortgagor,
and (ii) the
fair market value of such Mortgage Loan (or REO Property).
Qualified
Substitute
Mortgage Loan: A Mortgage Loan substituted by Residential
Funding or the Depositor
for a
Deleted
Mortgage
Loan
which
must,
on the
date of
such
substitution,
as
confirmed
in an
Officers'
Certificate delivered to the Trustee, (i) have an outstanding
principal balance,
after deduction of the principal
portion of the monthly
payment due in the month of
substitution
(or in the case of a
substitution
of more than
one Mortgage Loan for a Deleted Mortgage Loan, an aggregate
outstanding
principal balance,
after such deduction),
not in excess of the Stated
Principal
Balance of the Deleted
Mortgage
Loan (the amount of any
shortfall
to be
deposited by Residential
Funding,
in the Custodial
Account in the month of
substitution);
(ii) have a Mortgage
Rate and a Net Mortgage
Rate no lower than and not more than 1% per annum
higher than the
Mortgage
Rate and Net
Mortgage
Rate,
respectively,
of the
Deleted
Mortgage
Loan
as of
the
date
of
substitution;
(iii)
have a
Loan-to-Value
Ratio at the time of
substitution
no higher than that of the Deleted
Mortgage Loan at the time of
substitution;
(iv) have a remaining
term to stated
maturity
not
greater
than (and not more than one year less
than) that of the Deleted
Mortgage
Loan; (v) comply with each
representation
and warranty set forth in Sections
2.03 and 2.04 hereof and Section 4 of the
Assignment
Agreement,
(other than the
representations
and warranties
set forth therein with respect to the number of loans
(including
the related
percentage) in excess of zero which
meet or do not meet a
specified
criteria);
(vi) not be 30 days or more
Delinquent;
(vii) not be subject to the
requirements of HOEPA (as defined in the Assignment
Agreement);
(viii) have a policy of title
insurance,
in the
form and amount that is in material
compliance
with the Program
Guide,
that was
effective as of the closing of
such Mortgage
Loan, is valid and binding,
and remains in full force and effect,
unless the Mortgage
Property is
located in the State of Iowa where an attorney's
certificate
has been provided as described in the Program Guide;
(ix) if the
Deleted
Loan is not a Balloon
Loan,
not be a Balloon
Loan;
(x) with
respect to
adjustable
rate
Mortgage
Loans,
have a Mortgage
Rate that adjusts with the same
frequency and based upon the same Index as that
of the Deleted
Mortgage Loan;
(xi) with respect to adjustable
rate Mortgage
Loans,
have a Note Margin not less
than that of the Deleted
Mortgage
Loan;
(xii) with respect to adjustable
rate Mortgage
Loans,
have a Periodic
Rate Cap that is equal to that of the Deleted
Mortgage
Loan;
(xiii) with
respect to
adjustable
rate
Mortgage
Loans,
have a next
Adjustment
Date no later than that of the Deleted
Mortgage
Loan,
and (xiv) be secured by a
lien with the same lien priority as the Deleted Loan.
Rating
Agency:
Each of
Standard & Poor's and
Moody's.
If any
agency or a
successor
is no longer in
existence,
"Rating Agency" shall be such statistical credit rating agency, or
other comparable Person,
designated
by the Depositor, notice of which designation shall be given to the
Trustee and the Master Servicer.
Realized
Loss:
With respect to each Mortgage Loan (or REO
Property) as to which a Cash
Liquidation
or
REO
Disposition
has
occurred,
an amount (not less than zero) equal to (i) the Stated
Principal
Balance of the
Mortgage
Loan (or REO Property) as of the date of Cash
Liquidation
or REO
Disposition,
plus (ii) interest (and
REO Imputed
Interest,
if any) at the Net
Mortgage
Rate from the Due Date as to which
interest was last paid or
advanced to
Certificateholders
up to the last day of the month in which the Cash Liquidation (or
REO Disposition)
occurred on the Stated
Principal
Balance of such
Mortgage
Loan (or REO
Property)
outstanding
during each Due
Period that such interest was not paid or advanced,
minus (iii) the proceeds,
if any,
received
during the month
in which such Cash
Liquidation (or REO Disposition)
occurred,
to the extent applied as recoveries of interest at
the Net Mortgage
Rate and to
principal
of the Mortgage
Loan,
net of the portion
thereof
reimbursable
to the
Master Servicer or any Subservicer
with respect to related
Advances,
Servicing
Advances or other expenses as to
which the
Master
Servicer
or
Subservicer
is
entitled
to
reimbursement
thereunder
but which
have not been
previously
reimbursed.
With respect to each Mortgage Loan which is the subject of a
Servicing
Modification,
(a)
(1) the amount by which the interest
portion of a Monthly
Payment or the principal
balance of such Mortgage Loan
was
reduced
or (2) the sum of any other
amounts
owing
under the
Mortgage
Loan
that were
forgiven
and that
constitute
Servicing
Advances that are
reimbursable
to the Master
Servicer or a Subservicer,
and (b) any such
amount with respect to a Monthly
Payment that was or would have been due in the month
immediately
following
the
month in which a Principal
Prepayment
or the
Purchase
Price of such
Mortgage
Loan is received or is deemed to
have been
received.
With
respect to each
Mortgage
Loan which has become the subject of a Deficient
Valuation,
the difference
between the principal balance of the Mortgage Loan outstanding
immediately prior to such Deficient
Valuation and the principal
balance of the Mortgage
Loan as reduced by the Deficient
Valuation.
With respect to
each
Mortgage
Loan
which has
become the object of a Debt
Service
Reduction,
the amount of such Debt
Service
Reduction.
Notwithstanding
the above,
neither a Deficient Valuation nor a Debt Service Reduction shall be
deemed
a Realized
Loss
hereunder
so long as the Master
Servicer
has
notified
the Trustee in writing that the Master
Servicer is diligently
pursuing any remedies that may exist in connection with the
representations and warranties
made
regarding the related
Mortgage
Loan and either (A) the related
Mortgage Loan is not in default with regard
to payments due
thereunder or (B) delinquent
payments of principal and interest
under the related
Mortgage Loan
and any premiums on any applicable
primary hazard
insurance
policy and any related escrow payments in respect of
such Mortgage Loan are being advanced on a current basis by the
Master
Servicer or a
Subservicer,
in either case
without giving effect to any Debt Service Reduction.
Realized Losses allocated to the Class SB
Certificates
shall be allocated first to the REMIC III Regular
Interest
SB-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
SB-PO in reduction of the
Principal
Balance thereof.
To the extent the Master Servicer
receives
Subsequent
Recoveries with respect to any Mortgage Loan, the
amount of the Realized Loss with respect to that Mortgage
Loan will be reduced to the extent such
recoveries
are
applied to reduce the Certificate Principal Balance of any Class of
Certificates on any Distribution Date.
Record
Date:
With
respect
to each
Distribution
Date and the LIBOR
Certificates,
the
Business
Day
immediately
preceding such Distribution
Date. With respect to each Distribution Date and the Certificates
(other
than the LIBOR
Certificates),
the close of
business on the last
Business
Day of the month next
preceding
the
month in which the related
Distribution
Date
occurs,
except in the case of the first Record Date which shall be
the Closing Date.
Reference Bank Rate:
As defined in Section 1.02.
Regular Certificates:
The Class A Certificates, Class M Certificates and Class SB
Certificates.
Regulation
AB:
Subpart
229.1100
-
Asset
Backed
Securities
(Regulation
AB),
17
C.F.R.
ss.ss.229.1100-229.1123,
as
such
may
be
amended
from
time
to
time,
and
subject
to
such
clarification
and
interpretation
as
have
been
provided
by the
Commission
in the
adopting
release
(Asset-Backed
Securities,
Securities
Act
Release
No.
33-8518,
70 Fed.
Reg.
1,506,
1,531
(January
7,
2005))
or by the staff of the
Commission, or as may be provided by the Commission or its staff
from time to time.
Relief Act:
The Servicemembers Civil Relief Act, as amended.
Relief
Act
Shortfalls:
Interest
shortfalls
on the
Mortgage
Loans
resulting
from the Relief Act or
similar legislation or regulations.
REMIC: A "real estate
mortgage
investment
conduit"
within the meaning of
Section 860D of the Code. As
used herein, the term "REMIC" shall mean REMIC I, REMIC II or REMIC
III.
REMIC I:
The
segregated
pool of assets
subject
hereto,
constituting
a portion of the primary
trust
created hereby and to be administered
hereunder,
exclusive of the Yield
Maintenance
Agreement,
which is not an
asset of any REMIC, with respect to which a separate REMIC election
is to be made, consisting of:
(i)
the Mortgage Loans and the related Mortgage Files;
(ii)
all payments on and
collections
in respect of the Mortgage Loans due after the Cut-off
Date
(other than
Monthly
Payments
due in the month of the Cut-off
Date) as shall be on deposit in the
Custodial Account or in the Certificate Account and identified as
belonging to the Trust Fund;
(iii)
property
which
secured a Mortgage
Loan and which has been acquired for the benefit of
the Certificateholders by foreclosure or deed in lieu of
foreclosure;
(iv)
the
hazard
insurance
policies
and
Primary
Insurance
Policies
pertaining
to
the
Mortgage Loans, if any; and
(v)
all proceeds of clauses (i) through (iv) above.
REMIC I Available Distribution Amount:
The Available Distribution Amount.
REMIC I Distribution
Amount: For any Distribution Date, the REMIC I Available
Distribution
Amount shall
be
distributed
to the REMIC I
Regular
Interests
and Component I of the Class R
Certificates
in the following
amounts and priority:
(a)
To the
extent of the
portion
of the
REMIC I
Available
Distribution
Amount
related to Loan
Group I:
(i)
first,
to
REMIC I
Y-1
and
REMIC I
Z-1
Regular
Interests,
concurrently,
the
Uncertificated
Accrued Interest for such Regular Interests remaining unpaid from
previous
Distribution Dates, pro
rata according to their respective shares of such unpaid amounts;
(ii)
second,
to the
REMIC I
Y-1 and
REMIC I
Z-1
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 REMIC I Y-1 and REMIC I Z-1 Regular
Interests,
the REMIC I Y-1 Principal
Distribution Amount and the REMIC I Z-1 Principal Distribution
Amount, respectively.
(b)
To the
extent of the
portion
of the
REMIC I
Available
Distribution
Amount
related to Loan
Group II:
(i)
first,
to the
REMIC I
Y-2
and
REMIC I
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
REMIC I
Y-2 and
REMIC I
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
(iii)
third, to the REMIC I Y-2 and REMIC I Z-2 Regular
Interests,
the REMIC I Y-2 Principal
Distribution Amount and the REMIC I Z-2 Principal Distribution
Amount, respectively.
(c)
To the extent of the REMIC I
Available
Distribution
Amounts for Group I and
Group II for such
Distribution
Date remaining after payment of the amounts
pursuant to paragraphs (a) and (b) of this definition of
"REMIC I Distribution Amount:"
(i)
first, to each Class of
REMIC I Y and REMIC I Z Regular
Interests,
pro rata according
to the amount of unreimbursed
Realized
Losses
allocable to principal
previously
allocated to each such Regular
Interest,
the aggregate
amount of any
distributions to the Certificates as reimbursement of such Realized
Losses
on such
Distribution
Date
pursuant to clause
(xiii) in
Section 4.02(c);
provided,
however,
that any amounts
distributed
pursuant to this paragraph (c)(i) of this definition of "REMIC I
Distribution Amount" shall not cause
a reduction in the Uncertificated Principal Balances of any of the
REMIC I Y and REMIC I Z Regular Interests; and
(ii)
second, to Component I of the Class R Certificates, any remaining
amount.
REMIC I Interests:
The REMIC I Regular Interests and the Class R I Certificates.
REMIC I Y
Principal
Reduction
Amounts:
For
any
Distribution
Date
the
amounts
by
which
the
Uncertificated
Principal
Balances
of
the
REMIC I
Y-1
Regular
Interest
and
REMIC I
Y-2
Regular
Interest
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 I
and
Loan
Group II
determine
the
related
Net
WAC
Cap
Rate
for
distributions
of
interest
that
will be made on the
next
succeeding
Distribution
Date
(the
"Group Interest
Rate").
The REMIC I
Principal
Reduction
Amount for each of the REMIC I Y Regular
Interests
will be determined
pursuant to the "Generic
solution for the REMIC I Y Regular
Interests"
set forth below (the "Generic
Solution")
by making the following
identifications
among the Loan Groups and their related
REMIC I Y Regular
Interests and
REMIC I Z Regular Interests:
A.
Determine
which
Loan
Group has the lower Net WAC Cap Rate.
That Loan
Group
will be
identified with Loan Group AA and the REMIC I Y Regular
Interests and REMIC I Z Regular
Interests related to that
Loan
Group
will be
respectively
identified
with
the
REMIC I
YAA and
REMIC I
ZAA
Regular
Interests.
The
Group Interest
Rate for
that
Loan
Group
will be
identified
with J%.
If the two
Loan
Groups
have the same
Group Interest
Rate pick one for this purpose,
subject to the restriction that each Loan Group may be picked only
once in the course of any such selections pursuant to paragraphs A
and B of this definition.
B.
Determine
which Loan
Group has the
higher
Net WAC Cap Rate.
That Loan Group will be
identified with Loan Group BB and the REMIC I Y Regular
Interests and REMIC I Z Regular
Interests related to that
Group will be respectively
identified with the REMIC I YBB and REMIC I ZBB Regular
Interests.
The Group Interest
Rate for that Loan Group will be
identified
with K%. If the two Loan
Groups
have the same
Group Interest
Rate
the Loan Group not selected pursuant to paragraph A, above, will be
selected for purposes of this paragraph B.
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.
GENERIC SOLUTION FOR THE REMIC I Y PRINCIPAL
REDUCTION
AMOUNTS:
For any Distribution
Date, the amounts
by which the Uncertificated
Principal Balances of REMIC I YAA and REMIC I ZAA Regular Interests
respectively will
be reduced on such
Distribution
Date by the
allocation
of Realized
Losses and the
distribution
of principal,
determined as follows:
J% and K% represent the interest rates on Loan Group AA and Loan
Group BB respectively.
J% less than K%.
For purposes of the succeeding formulas the following symbols shall
have the meanings set forth below:
PJB =
the Loan Group AA
Subordinate
Balance
after the
allocation
of
Realized
Losses and
distributions of principal on such Distribution Date.
PKB =
the Loan Group BB
Subordinate
Balance
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)/(PJB + PKB)
Yj =
the REMIC I YAA Principal Balance after distributions on the prior
Distribution Date.
Yk =
the REMIC I YBB Principal Balance after distributions on the prior
Distribution Date.
(DELTA)Yj =
the REMIC I YAA Principal Reduction Amount.
(DELTA)Yk =
the REMIC I YBB Principal Reduction Amount.
Zj =
the REMIC I ZAA Principal Balance after distributions on the prior
Distribution Date.
Zk =
the REMIC I ZBB Principal Balance after distributions on the prior
Distribution Date.
(DELTA)Zj =
the REMIC I ZAA Principal Reduction Amount.
=
(DELTA)Pj - (DELTA)Yj
(DELTA)Zk =
the REMIC I ZBB Principal Reduction Amount.
=
(DELTA)Pk - (DELTA)Yk
Pj =
the
aggregate
Uncertificated
Principal
Balance of the
REMIC I
YAA and
REMIC I ZAA
Regular Interests after
distributions on the prior
Distribution
Date, which is equal to the aggregate
principal
balance of the Group AA Loans.
Pk =
the
aggregate
Uncertificated
Principal
Balance of the
REMIC I
YBB and
REMIC I ZBB
Regular Interests after
distributions on the prior
Distribution
Date, which is equal to the aggregate
principal
balance of the Loan Group BB Mortgage Loans.
(DELTA)Pj =
the aggregate
principal
reduction
resulting on such Distribution Date on the
Loan
Group AA
Mortgage
Loans as a result
of
principal
distributions
(exclusive
of any
amounts
distributed
pursuant to clauses
(c)(i) or (c)(ii) of the
definition of REMIC I
Distribution
Amount) to be made and Realized
Losses to be allocated on such
Distribution
Date, if
applicable,
which is equal to the aggregate of the REMIC I
YAA and REMIC I ZAA Principal Reduction Amounts.
(DELTA)Pk=
the aggregate
principal
reduction
resulting on such Distribution Date on the
Loan
Group BB
Mortgage
Loans as a result
of
principal
distributions
(exclusive
of any
amounts
distributed
pursuant to clauses
(c)(i) or (c)(ii) of the
definition of REMIC I
Distribution
Amount) to be made and realized
losses to be allocated on such
Distribution
Date,
which is equal to the aggregate of the REMIC I YBB and REMIC I
ZBB Principal Reduction Amounts.
(alpha) =
.0005
(gamma) =
(R - J%)/(K% - R). (gamma) is a non-negative
number unless its
denominator is
zero, in which event it is undefined.
If (gamma) is zero, (DELTA)Yk = Yk and (DELTA)Yj =
(Yj/Pj)(DELTA)Pj.
If (gamma) is undefined, (DELTA)Yj = Yj, (DELTA)Yk =
(Yk/Pk)(DELTA)Pk. if denominator
In the remaining situations, (DELTA)Yk and (DELTA)Yj shall be
defined as follows:
1.
If Yk -
(alpha)(Pk
-
(DELTA)Pk)
=
greater
than 0,
Yj-
(alpha)(Pj
-
(DELTA)Pj) = greater
than 0, and (gamma) (Pj - (DELTA)Pj)
less than (Pk -
(DELTA)Pk),
(DELTA)Yk = Yk - (alpha)(gamma) (Pj - (DELTA)Pj) and (DELTA)Yj
= Yj - (alpha)(Pj - (DELTA)Pj).
2.
If Yk -
(alpha)(Pk
-
(DELTA)Pk)
=
greater
than 0, Yj -
(alpha)(Pj
-
(DELTA)Pj)
= greater
than 0, and (gamma) (Pj -
(DELTA)Pj) = greater than
(Pk - (DELTA)Pk),
(DELTA)Yk = Yk - (alpha)(Pk - (DELTA)Pk) and (DELTA)Yj =
Yj - ((alpha)/(gamma))(Pk - (DELTA)Pk).
3.
If Yk - (alpha)(Pk - (DELTA)Pk) less than 0, Yj - (alpha)(Pj -
(DELTA)Pj) =
greater
than 0, and Yj -
(alpha)(Pj
-
(DELTA)Pj)
=
greater
than Yj -
(Yk/(gamma)),
(DELTA)Yk
=
Yk
-
(alpha)(gamma)
(Pj
-
(DELTA)Pj)
and
(DELTA)Yj = Yj - (alpha)(Pj - (DELTA)Pj).
4.
If Yk - (alpha)(Pk - (DELTA)Pk)
less than 0, Yj -
(Yk/(gamma))
= greater
than 0, and Yj - (alpha)(Pj - (DELTA)Pj) less than = Yj -
(Yk/(gamma)),
(DELTA)Yk =
0 and (DELTA)Yj = Yj - (Yk/(gamma)).
5.
If Yj - (alpha)(Pj - (DELTA)Pj) less than 0, Yj - (Yk/(gamma)) less
than 0,
and Yk - (alpha)(Pk - (DELTA)Pk) less than = Yk - ((gamma)Yj),
(DELTA)Yk =
Yk - ((gamma)Yj) and (DELTA)Yj = 0.
6.
If Yj - (alpha)(Pj - (DELTA)Pj) less than 0, Yk - (alpha)(Pk -
(DELTA)Pk) =
greater
than 0, and Yk -
(alpha)(Pk
-
(DELTA)Pk)
=
greater
than Yk -
((gamma)Yj),
(DELTA)Yk = Yk - (alpha)(Pk - (DELTA)Pk) and (DELTA)Yj = Yj -
((alpha)/(gamma))(Pk - (DELTA)Pk).
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 Yk to Yj equal to (gamma) after taking account
of the allocation
Realized
Losses and
the
distributions
that will be made through end of the Distribution Date to which
such provisions relate and
assuring
that the
Principal
Reduction
Amount for each of the REMIC I
YAA,
REMIC I
YBB,
REMIC I ZAA and
REMIC I ZBB Regular Interests is greater than or equal to zero for
such Distribution Date;
2.
Making (i) the REMIC I YAA
Principal
Balance
less than or equal to 0.0005 of the sum of the REMIC I YAA
and REMIC I ZAA principal
balances and (ii) the REMIC I YBB
principal
balances less than or equal to 0.0005
of the sum of the
REMIC I
YBB and
REMIC I
ZBB
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 Yk and whose
denominator
is the sum of Yk and
Zk and (b) the
fraction
whose
numerator
is Yj and whose
denominator
is the sum of Yj, and Zj 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 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 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 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.
REMIC I
Realized
Losses:
Realized
Losses on Group I Loans and Group II Loans shall be allocated to
the
REMIC I Regular
Interests as follows:
(1) The interest portion of Realized Losses on Group I Loans, if
any, shall
be allocated
among the REMIC I Y-1 and REMIC I Z-1 Regular
Interests pro rata according to the amount of interest
accrued but unpaid
thereon,
in reduction
thereof;
and (2) the interest
portion of Realized
Losses on Group II
Loans,
if any,
shall be allocated
among the REMIC I Y-2 and REMIC I Z-2 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 Loan Group and
allocated
pursuant to the succeeding
sentences.
The principal
portion of Realized
Losses with respect to Loan Group I and
Loan
Group II
shall be
allocated
to the REMIC I
Regular
Interests as follows:
(1) The
principal
portion of
Realized Losses on Group I Loans shall be allocated,
first,
to the REMIC I Y-1 Regular
Interest to the extent of
the REMIC I Y-1 Principal
Reduction Amount in reduction of the
Uncertificated
Principal
Balance of such REMIC I
Regular Interest and,
second,
the remainder,
if any, of such principal
portion of such Realized Losses shall be
allocated to the REMIC I Z-1 Regular Interest in reduction of the
Uncertificated
Principal
Balance thereof;
and
(2) the
principal
portion of Realized
Losses on Group II
Loans shall be
allocated,
first,
to the REMIC I Y-2
Regular
Interest to the extent of the REMIC I 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 REMIC I
Z-2 Regular
Interest
in
reduction
of the
Uncertificated
Principal Balance thereof.
REMIC I Regular Interests:
REMIC I Regular Interest Y-1, Y-2, Z-1 and Z-2.
REMIC I
Regular
Interest Y-1: A regular
interest in REMIC I that is held as an asset of REMIC II,
that
has an initial
principal balance equal to the related
Uncertificated
Principal
Balance,
that bears interest at
the related Uncertificated REMIC I Pass-Through Rate, and that has
such other terms as are described herein.
REMIC I Regular Interest Y-1 Principal
Distribution
Amount:
For any Distribution
Date, the excess,
if
any, of the REMIC I Regular Interest Y-1 Principal
Reduction Amount for such
Distribution
Date over the Realized
Losses allocated to the REMIC I Regular Interest Y-1 on such
Distribution Date.
REMIC I
Regular
Interest Y-2: A regular
interest in REMIC I that is held as an asset of REMIC II,
that
has an initial
principal balance equal to the related
Uncertificated
Principal
Balance,
that bears interest at
the related Uncertificated REMIC I Pass-Through Rate, and that has
such other terms as are described herein.
REMIC I Regular Interest Y-2 Principal
Distribution
Amount:
For any Distribution
Date, the excess,
if
any, of the REMIC I Regular Interest Y-2 Principal
Reduction Amount for such
Distribution
Date over the Realized
Losses allocated to the REMIC I Regular Interest Y-2 on such
Distribution Date.
REMIC I
Regular
Interest Z-1: A regular
interest in REMIC I that is held as an asset of REMIC II,
that
has an initial
principal balance equal to the related
Uncertificated
Principal
Balance,
that bears interest at
the related Uncertificated REMIC I Pass-Through Rate, and that has
such other terms as are described herein.
REMIC I Regular Interest Z-1 Principal
Distribution
Amount:
For any Distribution
Date, the excess,
if
any, of the REMIC I Regular Interest Z-1 Principal
Reduction Amount for such
Distribution
Date over the Realized
Losses allocated to the REMIC I Regular Interest Z-1 on such
Distribution Date.
REMIC I
Regular
Interest Z-2: A regular
interest in REMIC I that is held as an asset of REMIC II,
that
has an initial
principal balance equal to the related
Uncertificated
Principal
Balance,
that bears interest at
the related Uncertificated REMIC I Pass-Through Rate, and that has
such other terms as are described herein.
REMIC I Regular Interest Z-2 Principal
Distribution
Amount:
For any Distribution
Date, the excess,
if
any, of the REMIC I Regular Interest Z-2 Principal
Reduction Amount for such
Distribution
Date over the Realized
Losses allocated to the REMIC I Regular Interest Z-2 on such
Distribution Date.
REMIC I Z
Principal
Reduction
Amounts:
For
any
Distribution
Date,
the
amounts
by
which
the
Uncertificated
Principal
Balances of the REMIC I Z-1 and
REMIC I Z-2 Regular
Interests,
respectively,
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
