EXECUTION COPY
RESIDENTIAL FUNDING MORTGAGE SECURITIES I, INC.,
Company,
RESIDENTIAL FUNDING CORPORATION,
Master Servicer,
and
U.S. BANK NATIONAL ASSOCIATION,
Trustee
SERIES SUPPLEMENT,
DATED AS OF SEPTEMBER 1, 2006
TO
STANDARD TERMS OF
POOLING AND SERVICING AGREEMENT
DATED AS OF SEPTEMBER 1, 2006
Mortgage Pass-Through Certificates
Series 2006-S9
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TABLE OF CONTENTS
PAGE
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ARTICLE I
DEFINITIONS...............................................................5
Section 1.01
Definitions.......................................................5
Section 1.02 Use of
Words and Phrases.........................................19
Section 1.03
Determination of
LIBOR...........................................19
ARTICLE II
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; ORIGINAL ISSUANCE OF
CERTIFICATES.............................................................21
Section 2.01 Conveyance
of Mortgage Loans.....................................21
Section 2.02 Acceptance
by Trustee. (See
Section 2.02 of the Standard
Terms)...........................................................21
Section 2.03
Representations, Warranties and Covenants of the Master
Servicer and the
Company.........................................21
Section 2.04
Representations and Warranties of Residential Funding. (See
Section 2.04 of the Standard
Terms)..............................24
Section 2.05 Execution
and Authentication of Class R-I Certificates...........24
Section 2.06 Conveyance
of Uncertificated REMIC I and REMIC II Regular
Interests; Acceptance by the
Trustee.............................24
Section 2.07 Issuance
of Certificates Evidencing Interest in REMIC II.........24
Section 2.08 Purposes
and Powers of the Trust. (See Section 2.08 of the
Standard
Terms)..................................................25
Section 2.09 Agreement
Regarding Ability to Disclose..........................25
ARTICLE III
ADMINISTRATION AND SERVICING OF MORTGAGE
LOANS...........................26
Section 3.01 Master
Servicer to Act as Servicer. (See Section 3.01 of
the Standard
Terms)..............................................26
Section 3.02
Subservicing Agreements Between Master Servicer and
Subservicers; Enforcement of Subservicers' and Sellers'
Obligations......................................................26
Section 3.03 Successor
Subservicers. (See
Section 3.03 of the Standard
Terms)...........................................................27
Section 3.04 Liability
of the Master Servicer. (See Section 3.04 of the
Standard
Terms)..................................................27
Section 3.05 No
Contractual Relationship Between Subservicer and Trustee
or Certificateholders.
(See Section 3.05 of the Standard
Terms)...........................................................27
Section 3.06 Assumption
or Termination of Subservicing Agreements by
Trustee. (See Section
3.06 of the Standard Terms)...............27
Section 3.07 Collection
of Certain Mortgage Loan Payments; Deposits to
Custodial Account.
(See Section 3.07 of the Standard Terms).....27
Section 3.08
Subservicing Accounts; Servicing Accounts. (See Section
3.08 of the Standard
Terms)......................................27
Section 3.09 Access to
Certain Documentation and Information Regarding
the Mortgage Loans.
(See Section 3.09 of the Standard Terms)....27
Section 3.10 Permitted
Withdrawals from the Custodial Account. (See
Section 3.10 of the Standard
Terms)..............................27
Section 3.11
Maintenance of the Primary Insurance Policies; Collections
Thereunder. (See
Section 3.11 of the Standard Terms)............27
Section 3.12
Maintenance of Fire Insurance and Omissions and Fidelity
Coverage. (See Section
3.12 of the Standard Terms)..............27
Section 3.13
Enforcement of Due-on-Sale Clauses; Assumption and
Modification Agreements; Certain Assignments. (See Section
3.13 of the Standard
Terms)......................................27
Section 3.14
Realization Upon Defaulted Mortgage Loans. (See Section
3.14 of the Standard
Terms)......................................27
Section 3.15 Trustee to
Cooperate; Release of Custodial Files. (See
Section 3.15 of the Standard
Terms)..............................27
Section 3.16 Servicing
and Other Compensation; Compensating Interest.
(See Section 3.16 of the Standard
Terms).........................27
Section 3.17 Reports to
the Trustee and the Company. (See Section 3.17
of the Standard
Terms)...........................................27
Section 3.18 Annual
Statement as to Compliance. (See Section 3.18 of the
Standard
Terms)..................................................28
Section 3.19 Annual
Independent Public Accountants' Servicing Report.
(See Section 3.19 of the Standard
Terms).........................28
Section 3.20 Rights of
the Company in Respect of the Master Servicer.
(See Section 3.20 of the Standard
Terms).........................28
Section 3.21
Administration of Buydown Funds. (See Section 3.21 of the
Standard
Terms)..................................................28
Section 3.22 Advance
Facility. (See Section
3.22 of the Standard Terms)......28
ARTICLE IV
PAYMENTS TO
CERTIFICATEHOLDERS...........................................29
Section 4.01
Certificate Account.
(See Section 4.01 of the Standard
Terms)...........................................................29
Section 4.02
Distributions....................................................29
Section 4.03 Statements
to Certificateholders; Statements to Rating
Agencies; Exchange Act Reporting. (See Section 4.03 of the
Standard Terms) and Exhibit Three
hereto)........................38
Section 4.04
Distribution of Reports to the Trustee and the Company;
Advances by the Master Servicer. (See Section 4.04 of the
Standard
Terms)..................................................38
Section 4.05 Allocation
of Realized Losses....................................38
Section 4.06 Reports of
Foreclosures and Abandonment of Mortgaged
Property. (See Section
4.06 of the Standard Terms)..............40
Section 4.07 Optional
Purchase of Defaulted Mortgage Loans. (See Section
4.07 of the Standard
Terms)......................................40
Section 4.08 Surety
Bond. (See Section
4.08 of the Standard Terms)...........40
Section 4.09 The Yield
Maintenance Agreement..................................40
Section 4.10 Reserve
Fund.....................................................41
ARTICLE V
THE CERTIFICATES (SEE ARTICLE V OF THE STANDARD
TERMS)...................42
ARTICLE VI
THE COMPANY AND THE MASTER
SERVICER......................................43
Section 6.01 Respective
Liabilities of the Company and Master Servicer.
(See Section 6.01 of the Standard
Terms.)........................43
Section 6.02 Merger or
Consolidation of the Company or Master Servicer;
Assignment of Rights and Delegation of Duties by Master
Servicer.........................................................43
Section 6.03 Limitation
on Liability of the Company, Master Servicer and
Others. (See Section
6.03 of the Standard Terms.)...............43
Section 6.04 Company
and Master Servicer Not to Resign. (See Section
6.04 of the Standard
Terms.).....................................43
ARTICLE VII
DEFAULT (SEE ARTICLE VII OF THE STANDARD
TERMS)..........................44
ARTICLE VIII CONCERNING
THE TRUSTEE (SEE ARTICLE VIII OF THE STANDARD
TERMS)..........45
ARTICLE IX
TERMINATION OR OPTIONAL PURCHASE OF ALL
CERTIFICATES.....................46
Section 9.01 Optional
Purchase by the Master Servicer of All
Certificates; Termination Upon Purchase by the Master
Servicer or Liquidation of All Mortgage
Loans....................46
Section 9.02 Additional
Termination Requirements. (See Section 9.02 of
the Standard
Terms)..............................................46
Section 9.03
Termination of Multiple REMICs. (See Section 9.03 of the
Standard
Terms)..................................................46
ARTICLE X
REMIC
PROVISIONS.........................................................47
Section 10.01 REMIC
Administration. (See
Section 10.01 of the Standard
Terms)...........................................................47
Section 10.02 Master Servicer;
REMIC Administrator and Trustee
Indemnification. (See
Section 10.02 of the Standard Terms)......47
Section 10.03 Designation of
REMIC(s)..........................................47
Section 10.04 Distributions on
the Uncertificated REMIC I Regular
Interests
Z......................................................47
Section 10.05 Compliance with
Withholding Requirements.........................49
ARTICLE XI
MISCELLANEOUS
PROVISIONS.................................................50
Section 11.01 Amendment.
(See Section 11.01 of
the Standard Terms)............50
Section 11.02 Recordation of
Agreement, Counterparts. (See Section 11.02
of the Standard
Terms)...........................................50
Section 11.03 Limitation on
Rights of Certificateholders. (See Section
11.03 of the Standard
Terms).....................................50
Section 11.04 Governing Laws.
(See Section 11.04 of
the Standard Terms).......50
Section 11.05
Notices..........................................................50
Section 11.06 Required Notices
to Rating Agency and Subservicer. (See
Section 11.06 of the Standard
Terms).............................51
Section 11.07 Severability of
Provisions. (See
Section 11.07 of the
Standard
Terms)..................................................51
Section 11.08 Supplemental
Provisions for Resecuritization. (See Section
11.08 of the Standard
Terms).....................................51
Section 11.09 Allocation of
Voting Rights......................................51
Section 11.10 No Petition.
(See Section 11.10 of
the Standard Terms)..........51
ARTICLE XII
COMPLIANCE WITH REGULATION AB (SEE ARTICLE XII OF THE STANDARD
TERMS)...................................................................52
<PAGE>
TABLE OF CONTENTS
(continued)
PAGE
EXHIBITS
Exhibit One: Mortgage
Loan Schedule (Available from the Company upon request.)
Exhibit Two: Schedule
of Discount Fractions (Available from the Company upon
request.)
Exhibit Three: Information to be
Included in Monthly Distribution Date Statement
Exhibit Four: Standard Terms
of Pooling and Servicing Agreement dated as of September 1,
2006
Exhibit Five: Aggregate
Planned Principal Balance
Exhibit Six: Targeted
Principal Balance
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<PAGE>
This is a Series Supplement, dated as of September 1, 2006 (the
"Series
Supplement"), to the Standard Terms of Pooling and Servicing
Agreement, dated as
of September 1, 2006 and attached as Exhibit Four hereto (the
"Standard Terms"
and, together with this Series Supplement, the "Pooling and
Servicing Agreement"
or "Agreement"), among
RESIDENTIAL FUNDING
MORTGAGE SECURITIES I, INC., as the
company (together with
its permitted
successors and assigns, the "Company"),
RESIDENTIAL FUNDING CORPORATION, as master servicer (together with
its permitted
successors and
assigns, the "Master Servicer"), and U.S. BANK NATIONAL
ASSOCIATION, as Trustee (together with its permitted successors and
assigns, the
"Trustee").
PRELIMINARY STATEMENT
The Company
intends
to sell Mortgage Pass-Through Certificates
(collectively, the "Certificates"), to be issued hereunder in multiple
classes,
which in the aggregate will evidence the entire beneficial
ownership interest in
the Trust Fund. As provided herein, the REMIC Administrator will make an
election to
treat the entire segregated pool of assets described in the
definition of Trust Fund, and subject to this Agreement
(including the
Mortgage
Loans but excluding the Initial Monthly Payment Fund, the Yield Maintenance
Agreement and any
payments thereunder and the Reserve Fund and any payments
therefrom), as a real
estate mortgage
investment
conduit (the "REMIC") for
federal income
tax purposes and such segregated pool of assets will be
designated as "REMIC I." The Uncertificated REMIC Regular I Interests
will be
"regular interests" in
REMIC I and the Class R-I Certificates will be the sole
class of "residual
interests" in REMIC I
for purposes of the REMIC Provisions
(as defined
herein).
A segregated pool of assets consisting of the
Uncertificated REMIC I
Regular Interests will
be designated as "REMIC II," and
the REMIC
Administrator will
make a separate REMIC election with respect
thereto. The
Class A-1 Certificates, Class A-2 Certificates, Class A-3
Certificates,
Class A-4 Certificates, Class A-5 Certificates, Class A-6
Certificates,
Class A-7 Certificates, Class A-8 Certificates, Class A-9
Certificates, Class
A-10 Certificates, Class A-11, Class A-12, Class A-P
Certificates,
Class M-1 Certificates, Class M-2 Certificates, Class M-3
Certificates,
Class B-1 Certificates, Class B-2 Certificates, Class B-3
Certificates and
the Uncertificated REMIC II Regular Interests Z will be
"regular interests" in REMIC II and the Class R-II Certificates
will be the sole
class of "residual interests" therein for purposes of the REMIC
Provisions. The
Class A-V Certificates will represent the entire beneficial
ownership interest
in the Uncertificated REMIC II Regular Interests Z.
The terms and provisions of the Standard Terms are hereby incorporated
by reference herein as though set forth in full herein. If any term
or provision
contained herein shall
conflict with or be inconsistent with any provision
contained in the
Standard Terms, the terms and provisions of this Series
Supplement shall
govern. Any
cross-reference
to a section of the
Pooling and
Servicing Agreement,
to the extent the
terms of the Standard
Terms and Series
Supplement conflict with respect to that section, shall be a cross-reference to
the related
section of the Series Supplement. All capitalized terms not
otherwise defined
herein shall have the meanings set forth in the Standard
Terms. The Pooling and Servicing Agreement shall be dated as of the
date of the
Series Supplement.
The following table sets forth the designation, type, Pass-Through
Rate,
aggregate Initial Certificate Principal Balance, Maturity Date, initial ratings
and certain features for each Class of Certificates comprising the interests in
the Trust Fund created hereunder.
<TABLE>
<CAPTION>
Aggregate
Initial
Certificate
Pass-Through
Principal
Maturity
Minimum
Designation
Rate
Balance
Features(1)
Date
Moody's/S&P/Fitch
Denominations(2)
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Class A-1
6.25% $42,573,000
Super Senior/Lockout/Fixed Rate September 2036
Aaa/AAA/AAA
$100,000.00
Class A-2
6.25% $1,659,000
Senior
Support/Lockout/Fixed Rate September 2036
Aaa/AAA/AAA
$100,000.00
Class A-3
5.75% $108,945,000
Senior/PAC/Fixed Rate
September 2036
Aaa/AAA/AAA
$100,000.00
Class A-4
5.75% $34,965,000
Senior/PAC/Fixed Rate
September 2036
Aaa/AAA/AAA $100,000.00
Senior/TAC/Accretion
Class A-5
6.25%
September 2036
Aaa/AAA/AAA
$100,000.00
$78,921,000
Directed/Fixed Rate
Class A-6
6.25%
Senior/Accrual/Accretion
September 2036
Aaa/AAA/AAA
$100,000.00
$5,038,000
Directed/Companion/Fixed Rate
Class A-7
6.25%
$100,000
Senior/Accrual/Companion/Fixed Rate September 2036
Aaa/AAA/AAA
$100,000.00
Class A-8(3) Variable
Senior/Floater/Adjustable Rate September 2036
Aaa/AAA/AAA
$100,000.00
Rate
$53,500,000
Class A-9(3)
Variable
Senior/Inverse Floater/
September 2036
Aaa/AAA/AAA
$1,000,000.00
Rate
Notional
Interest Only/Adjustable Rate
Class A-10
6.25% $80,677,000
Senior/Fixed Rate
September 2036
Aaa/AAA/AAA
$100,000.00
Class A-11
6.25% $19,147,000
Senior/Retail/Fixed Rate
September 2036
Aaa/AAA/AAA
$1,000.00
Class A-12(4) 6.25%
Notional
Senior/PAC/Interest Only/Fixed Rate September 2036
Aaa/AAA/AAA
$1,000,000.00
Class A-P
0.00%
$205,694
Senior/Principal Only
September 2036
Aaa/AAA/AAA
$100,000.00
Class A-V
Variable Notional
Senior/Interest Only/Variable September 2036
Aaa/AAA/AAA
$2,000,000.00
Rate
Rate
Class R-I
6.25%
$100.00
Senior/Residual/Fixed Rate
September 2036
Aaa/AAA/AAA
(5)
Class R-II
6.25%
$100.00
Senior/Residual/Fixed Rate
September 2036
Aaa/AAA/AAA
(4)
Class M-1
6.25% $9,509,800
Mezzanine/Fixed Rate
September 2036
NA/NA/AA
$100,000.00
Class M-2
6.25% $2,653,900
Mezzanine/Fixed Rate
September 2036 NA/NA/A
$250,000.00
Class M-3
6.25% $1,769,300
Mezzanine/Fixed Rate
September 2036
NA/NA/BBB
$250,000.00
Class B-1
6.25%
$884,600
Subordinate/Fixed Rate
September 2036
NA/NA/BB
$250,000.00
Class B-2
6.25%
$884,700
Subordinate/Fixed Rate
September 2036
NA/NA/B
$250,000.00
Class B-3
6.25%
$884,651
Subordinate/Fixed Rate
September 2036
NA/NA/NA
$250,000.00
(1)
The Certificates,
other than the Class B and Class R Certificates shall
be Book-Entry
Certificates. The
Class B Certificates
and the Class R
Certificates shall be delivered to the holders thereof in physical
form.
(2)
The Certificates, other than the Class R Certificates, shall be
issuable
in minimum dollar
denominations
as indicated above (by Certificate
Principal Balance or
Notional Amount, as applicable) and integral
multiples of $1 (or
$1,000 in the case of
the Class A-11,
Class B-1,
Class B-2 and Class B-3 Certificates) in excess thereof, except
that one
Certificate of
any of the Class B-1, Class B-2 and Class B-3
Certificates that
contain an uneven
multiple of $1,000 shall be issued
in a denomination
equal to the sum of the related minimum denomination
set forth above and
such uneven multiple
for such Class or the
sum of
such denomination and an integral multiple of $1,000.
(3)
Initial
Adjustable
Pass-Through
Formula
Rates:
Rate
Maximum
Minimum
Class A-8
5.97%
LIBOR + 0.65%
Subject to
the Available
0.65%
Funds Cap
Class A-9
0.28%
5.60% - LIBOR
5.60%
0.00%
</TABLE>
The Class A-9 Certificates do not have a Certificate Principal Balance. For the
purpose of calculating interest payments, interest on the Class A-9
Certificates
will accrue on a notional amount equal to the Certificate
Principal Balance of
the Class A-8 Certificates immediately prior to the related
Distribution Date,
which is initially equal to $53,500,000.
The Class A-8
Certificates will
represent ownership of
a regular interest
in
REMIC II, together
with certain rights to payments to be made from amounts
received under the Yield Maintenance Agreement or on deposit in the
Reserve Fund
which will be deemed made for federal income tax purposes outside
of REMIC II.
(4)
The Class A-12 Certificates do not have a Certificate Principal
Balance.
For
the purpose of calculating interest payments, interest will accrue
on a notional
amount equal to 2/25th of the aggregate Certificate
Principal
Balance of
the Class A-3 and Class A-4 Certificates.
Initially, this
Notional Amount is
equal to $11,512,800.
For federal
income tax
purposes, however, interest payments on the Class A-12
Certificates are
expressed as 0.50%
multiplied by the Notional Amount
(as defined herein) of each of the Class A-3 Certificates and Class A-4
Certificates.
(5)
The Class R Certificates shall be issuable in minimum
denominations of
not less than a 20% Percentage Interest; provided, however, that one
Class R Certificate
will be issuable to Residential Funding as "tax
matters person"
pursuant to Section 10.01(c) and (e) in a minimum
denomination representing a Percentage Interest of not less than
0.01%
<PAGE>
The Mortgage Loans have an aggregate principal balance as of the
Cut-off
Date of $442,317,845.
In consideration of the mutual agreements herein contained, the
Company,
the Master Servicer and the Trustee agree as follows:
<PAGE>
ARTICLE I
DEFINITIONS
Section 1.01...Definitions.
Whenever used in this Agreement, the following words and phrases,
unless
the context
otherwise requires, shall have the meanings specified in this
Article.
Accretion
Termination
Date: With
respect to (i) the Class A-6
Certificates, the
earlier of (a) the Distribution Date on which the Certificate
Principal Balance of
the Class A-5
Certificates is reduced to zero and (b) the
Credit Support Depletion Date; and (ii) the Class A-7 Certificates,
the earlier
of (a) the
Distribution Date on
which the aggregate Certificate Principal
Balance of the Class A-5 and Class A-6 Certificates is reduced to zero and (b)
the Credit Support Depletion Date.
Accrual Certificates:
Any one of the
Class A-6 Certificates and the
Class A-7 Certificates.
Accrual Distribution Amount: With respect to each Distribution
Date, the
sum of the Class A-6
Accrual Distribution Amount and the Class A-7 Accrual
Distribution Amount.
Adjustable Rate
Certificates:
Any one of the
Class A-8 and Class
A-9
Certificates.
Aggregate Planned Principal Balance: With respect to each
Distribution
Date, the aggregate
planned principal
balance set forth for
that Distribution
Date for the Class A-3 and Class A-4 Certificates in Exhibit Five
hereto.
Available Funds Cap: With respect to any Distribution Date on or before
the Distribution Date
in March 2016 and the Class A-8 Certificates, 6.25% per
annum plus amounts, if
any, paid pursuant to
the Yield Maintenance
Agreement
(which shall not be part of any REMIC hereunder) and on deposit in the Reserve
Fund (which shall not be part of any REMIC hereunder) up to an amount equal to
the Yield Supplement Amount for such Distribution Date, expressed
as a per annum
rate. With respect to any Distribution Dates after March 2016,
6.25% per annum.
Bankruptcy Amount:
As of any date of
determination prior to
the first
anniversary of the
Cut-off Date, an amount equal to the excess, if any, of (A)
$122,749 over (B) the aggregate amount of Bankruptcy Losses allocated solely to
one or more specific
Classes of Certificates in accordance with Section 4.05 of
this Series
Supplement. As of any
date of determination
on or after the first
anniversary of the Cut-off Date, an amount equal to the excess, if
any, of
(1) the lesser of (a) the Bankruptcy Amount calculated as of the
close of business on the Business Day immediately preceding the most
recent anniversary of the Cut-off Date coinciding with or preceding
such
date of determination (or, if such date of determination is an
anniversary of the Cut-off Date, the Business Day immediately
preceding
such date of
determination)
(for purposes of this definition, the
"Relevant Anniversary") and (b) the greater of
(A) the greater of (i) 0.0006 times the aggregate
principal balance of
all the Mortgage Loans in the Mortgage Pool
as of the Relevant Anniversary (other than Additional Collateral
Loans, if any) having a Loan-to-Value Ratio at origination which
exceeds 75% and (ii) $122,749; and
(B) the greater of (i) the product of (x) an amount equal
to the largest
difference in the related Monthly Payment for any
Non-Primary Residence
Loan remaining in the Mortgage Pool (other
than Additional
Collateral Loans, if
any) which had an original
Loan-to-Value Ratio of
80% or greater that
would result if
the
Net Mortgage
Rate thereof was equal to the weighted average
(based on
the principal balance
of the Mortgage Loans
as of the
Relevant Anniversary)
of the Net Mortgage
Rates of all Mortgage
Loans as of the Relevant Anniversary less 1.25% per annum,
(y) a
number equal to the weighted average remaining term to maturity,
in months, of all
Non-Primary
Residence Loans
remaining in the
Mortgage Pool as of
the Relevant
Anniversary, and (z)
one plus
the quotient of the
number of all
Non-Primary Residence
Loans
remaining in the
Mortgage Pool divided by the total number of
Outstanding Mortgage
Loans in the Mortgage Pool as of the
Relevant Anniversary, and (ii) $122,749,
over
(2) the aggregate amount of Bankruptcy Losses allocated solely
to
one or more specific
Classes of Certificates in accordance with Section
4.05 since the Relevant Anniversary.
The Bankruptcy
Amount may be further reduced by the Master Servicer
(including
accelerating the manner in which such coverage is reduced)
provided
that prior to any such
reduction, the Master
Servicer shall (i) obtain written
confirmation from each
Rating Agency that such reduction shall not reduce the
rating assigned to any
Class of Certificates
by such Rating
Agency below the
lower of the then-current rating or the rating assigned to
such Certificates as
of the Closing
Date by such
Rating Agency and (ii) provide a copy of such
written confirmation to the Trustee.
Business Day:
Any day other than (i)
a Saturday or a Sunday
or (ii) a
day on which banking
institutions
in the State of New York, the State of
Michigan, the State of
California,
the State of
Illinois or the City of St.
Paul, Minnesota (and
such other state or states in which the Custodial Account
or the Certificate
Account are at the
time located) are required or authorized
by law or executive order to be closed.
Capitalization
Reimbursement Amount:
As to any Distribution
Date, the
amount of Advances or Servicing Advances that were added to the
Stated Principal
Balance of the
related Mortgage Loans during the prior calendar month and
reimbursed to
the Master Servicer or Subservicer on or prior to such
Distribution Date
pursuant to Section
3.10(a)(vii),
plus the Capitalization
Reimbursement
Shortfall Amount
remaining
unreimbursed
from
any prior
Distribution Date and
reimbursed to the
Master Servicer or
Subservicer on or
prior to such Distribution Date, provided, however, that the Capitalization
Reimbursement Amount
shall at no time
exceed five percent of the aggregate
Cut-Off Date
Principal Balance of the Mortgage Loans, unless such limit is
increased from time to time with the consent of the Rating
Agencies.
Certificate: Any Class
A, Class M, Class B or Class R Certificate.
Certificate Account:
The separate account or accounts created and
maintained pursuant
to Section
4.01 of the
Standard Terms, which shall be
entitled "U.S.
Bank National Association, as trustee, in trust for the
registered holders of Residential Funding Mortgage Securities I,
Inc., Mortgage
Pass-Through
Certificates, Series
2006-S9" and which must be an Eligible
Account.
Class A Certificate:
Any one of the Class
A-1, Class A-2,
Class A-3,
Class A-4, Class A-5,
Class A-6,
Class A-7, Class A-8,
Class A-9, Class A-10,
Class A-11, Class
A-12, Class A-P or
Class A-V
Certificates, executed
by the
Trustee and authenticated by the Certificate Registrar
substantially in the form
annexed to the Standard Terms as Exhibit A.
Class A-6 Accrual Distribution Amount: With respect to each
Distribution
Date preceding the Accretion Termination Date for the Class A-6
Certificates, an
amount equal to the
amount of Accrued
Certificate
Interest on the Class A-6
Certificates for that
date, which will be
added to the
Certificate
Principal
Balance of the Class A-6 Certificates, and distributed in the manner
described
in Section
4.02(b)(ii)(B)
to the holders of the Class A-5 and Class A-6
Certificates, as
principal in reduction of the Certificate Principal Balances
thereof. Any
distributions of the Class A-6 Accrual Distribution Amount to the
Class A-5 and Class A-6 Certificates will reduce the Certificate Principal
Balances of the Class A-5 and Class A-6 Certificates by that
amount. The amount
that is added to the Certificate Principal Balances of the Class A-6
Certificates will
accrue interest at a rate of 6.25% per annum. On each
Distribution Date on
or after the Accretion
Termination Date for the Class A-6
Certificates,
the entire
Accrued Certificate Interest on the Class A-6
Certificates for that
date will be
payable to the holders of the Class A-6
Certificates, as interest.
Class A-7 Accrual Distribution Amount: With respect to each
Distribution
Date preceding the Accretion Termination Date for the Class A-7
Certificates, an
amount equal to the
amount of Accrued
Certificate
Interest on the Class A-7
Certificates for that
date, which will be
added to the
Certificate
Principal
Balance of the Class A-7 Certificates, and distributed in the manner
described
in Section
4.02(b)(ii)(A) to the
holders of the Class A-5, Class A-6 and Class
A-7 Certificates,
as principal in reduction of the Certificate Principal
Balances thereof. Any distributions of the Class A-7 Accrual
Distribution Amount
to the Class
A-5, Class A-6 and Class A-7 Certificates will reduce the
Certificate Principal
Balances of the Class A-5, Class A-6 and Class A-7
Certificates by that
amount. The amount that is added to the Certificate
Principal Balance of
the Class A-7 Certificates will accrue interest at a rate
of 6.25% per annum. On each Distribution Date on or after the Accretion
Termination Date for the Class A-7 Certificates, the entire Accrued Certificate
Interest on the Class
A-7 Certificates
for that date will be
payable to the
holders of the Class A-7 Certificates, as interest.
Class A-P
Principal Distribution Amount: As defined in Section
4.02(b)(i).
Class R Certificate: Any one of the Class R-I or Class R-II
Certificates
executed by
the Trustee and authenticated by the Certificate Registrar
substantially in the
form annexed to the Standard Terms as Exhibit D and
evidencing an interest
designated as a "residual interest" in the related REMIC
for purposes of the REMIC Provisions.
Closing Date:
September 28, 2006.
Corporate Trust Office: The principal office of the
Trustee at which at
any particular time
its corporate trust business with respect to this Agreement
shall be administered, which office at the date of the execution of this
Agreement is
located at U.S. Bank National Association, EP-MN-WS3D, 60
Livingston
Avenue, St.
Paul, Minnesota 55107, Attention: Structured
Finance/RFMSI 2006-S9.
Cut-off Date:
September 1, 2006.
Determination Date:
With respect to any
Distribution Date, the
second
Business Day prior to such Distribution Date.
Discount Net Mortgage Rate: 6.25% per annum.
Due Period: With
respect to each
Distribution
Date and any
Mortgage
Loan, the calendar month of such Distribution Date.
Eligible Funds: On any
Distribution Date, the
portion, if any, of
the
Available Distribution
Amount remaining after reduction by the
sum of (i) the
aggregate amount of
Accrued Certificate
Interest on the Senior
Certificates,
(ii) the Senior
Principal Distribution
Amount (determined without regard to
Section
4.02(a)(ii)(Y)(D) of
this Series
Supplement),
(iii) the Class A-P
Principal
Distribution
Amount
(determined
without regard
to Section
4.02(b)(i)(E) of this
Series Supplement) and (iv) the aggregate amount of
Accrued Certificate
Interest
on the Class M, Class B-1 and Class B-2
Certificates.
Floater Certificates:
The Class A-8 Certificates.
Fraud Loss Amount:
As of any date of
determination
after the Cut-off
Date, an amount
equal to: (X) prior to
the first anniversary
of the Cut-off
Date, an amount equal to 3.00% of the aggregate outstanding
principal balance of
all of the Mortgage
Loans as of the Cut-off Date minus the aggregate amount of
Fraud Losses allocated solely to one or more specific Classes of
Certificates in
accordance with Section 4.05 of this Series Supplement since the
Cut-off Date up
to such date of
determination,
(Y) prior to the second anniversary of the
Cut-off Date, an amount equal to 2.00% of the aggregate outstanding principal
balance of all of the Mortgage Loans as of the Cut-off Date minus
the aggregate
amount of Fraud Losses
allocated solely to one or more specific Classes of
Certificates in accordance with Section 4.05 of this Series
Supplement since the
Cut-off Date up to
such date of
determination
and (Z) from the
third to the
fifth anniversary of
the Cut-off Date, an amount equal to (1) the lesser of (a)
the Fraud Loss Amount as of the most recent anniversary of the Cut-off Date
and
(b) 1.00% of the aggregate outstanding principal balance of
all of the Mortgage
Loans as of the most
recent anniversary
of the Cut-off Date minus (2) the
aggregate amount
of Fraud Losses allocated solely to one or more specific
Classes of
Certificates
in accordance with Section 4.05 of this Series
Supplement since the most recent anniversary of the Cut-off Date up
to such date
of determination.
On and after the fifth
anniversary of the
Cut-off Date, the
Fraud Loss Amount shall be zero.
The Fraud Loss
Amount may be
further reduced by the Master Servicer
(including
accelerating the manner in which such coverage is reduced)
provided
that prior to any such
reduction, the Master
Servicer shall (i) obtain written
confirmation from each
Rating Agency that such reduction shall not reduce the
rating assigned to any
Class of Certificates
by such Rating
Agency below the
lower of the then-current rating or the rating assigned to
such Certificates as
of the Closing
Date by such
Rating Agency and (ii) provide a copy of such
written confirmation to the Trustee.
Initial Monthly Payment Fund: $85,056 representing scheduled principal
amortization and interest at the Net Mortgage Rate during the month
of September
2006, for those
Mortgage Loans for which the Trustee
will not be entitled
to
receive such payment in accordance with the definition of "Trust Fund". The
Initial Monthly Payment Fund will not be part of any REMIC.
Initial Notional
Amount: With respect
to any Class A-V Certificates or
Subclass thereof issued pursuant to Section 5.01(c), the aggregate Cut-off Date
Principal Balance of the Mortgage Loans relating to the
Uncertificated
REMIC I
Regular Interests Z, and correspondingly, the Uncertificated REMIC II Regular
Interests Z, corresponding to such Class or Subclass on such
date.
Interest Accrual Period: With respect to any Certificates (other than
the Adjustable Rate
Certificates) and any Distribution Date, the calendar month
preceding the month in which such Distribution Date occurs.
With respect to
the
Adjustable Rate Certificates and any Distribution Date, the period beginning on
the 25th day of the month preceding the month in which such
Distribution
Date
occurs and ending on the 24th day of the month in which such
Distribution
Date
occurs.
Interest Only
Certificates:
Any one of the Class
A-V, Class A-9 and
Class A-12 Certificates. The Interest Only Certificates will have
no Certificate
Principal Balance.
Inverse Floater Certificates: The Class A-9 Certificates.
LIBOR: With respect to any Distribution Date, the arithmetic mean
of the
placeCityLondon
interbank offered rate
quotations for
one-month U.S.
Dollar
deposits, expressed on
a per annum basis, determined in accordance with Section
1.03.
LIBOR Business Day:
Any day other than (i) a Saturday or Sunday or (ii)
a day on which banking
institutions in
placeCityLondon,
country-regionEngland
are required or authorized by law to be closed.
LIBOR Rate Adjustment Date: With respect to each Distribution Date and
the Adjustable Rate
Certificates,
the second LIBOR
Business Day
immediately
preceding the commencement of the related Interest Accrual Period
on which banks
are open for dealing
in foreign
currency and exchange in placeCityLondon,
country-regionEngland.
Lockout Amount: With
respect to any Distribution Date, an amount equal
to the sum of the following:
(a) the product of (i)
the Lockout
Percentage
for that Distribution
Date, and (ii) the aggregate collections described in clauses (A),(B) and
(E),
to the extent clause (E) relates to clause (A) or (B), of Section
4.02(a)(ii)(Y)
without applying the Senior Percentage and the Senior Accelerated Distribution
Percentage on such Distribution Date, plus
(b) the product of (i)
the Lockout
Percentage
for that Distribution
Date, (ii) the Lockout
Prepayment Percentage
for that Distribution
Date, and
(iii) the aggregate
collections described in clauses (C) and (E), to the extent
clause (E) relates to clause (C) of Section 4.02(a)(ii)(Y) without applying
the
Senior Accelerated Distribution Percentage.
Lockout Percentage:
With respect to any
Distribution Date prior to the
Distribution Date in
October 2011,
0%, and with respect
to such
Distribution
Date and any Distribution Date thereafter, a fraction, expressed as a
percentage, (i) the
numerator of which is the aggregate Certificate Principal
Balance of the Class A-1 and Class A-2 Certificates and (ii) the
denominator of
which is the aggregate Stated Principal Balance of the mortgage
loans other than
the Discount Fraction of each Discount Mortgage Loan.
Lockout Prepayment Percentage: For any Distribution Date occurring
prior
to the Distribution
Date in October 2011, 0%. For any Distribution Date
occurring after the
first five years
following the Closing
Date, a percentage
determined as follows: (i) for any Distribution Date during the
sixth year after
the Closing Date, 30%;
(ii) for any
Distribution Date
during the seventh year
after the Closing Date, 40%; (iii) for any Distribution Date during the eighth
year after the Closing
Date, 60%;
(iv) for any
Distribution
Date during the
ninth year after the
Closing Date, 80%; and (v) for any Distribution Date
thereafter, 100%.
Maturity Date:
With respect to each Class of Certificates, the
Distribution Date in September 2036, which is the Distribution Date
in the month
immediately following the latest scheduled maturity date of any
Mortgage Loan.
Mortgage Loan Schedule: The list or lists of the Mortgage Loans
attached
hereto as Exhibit One (as amended from time to time to reflect the
addition of
Qualified Substitute
Mortgage Loans),
which list or lists
shall set forth the
following information as to each Mortgage Loan:
(a) the
Mortgage Loan identifying number ("RFC LOAN #");
(b) the
maturity of the Mortgage Note ("MATURITY DATE");
(c) the
Mortgage Rate ("ORIG RATE");
(d) the
Subservicer pass-through rate ("CURR NET");
(e) the
Net Mortgage Rate ("NET MTG RT");
(f) the
Pool Strip Rate ("STRIP");
(g) the
initial scheduled
monthly payment of principal, if any,
and interest
("ORIGINAL P & I");
(h) the
Cut-off Date Principal
Balance ("PRINCIPAL
BAL"); (i) the
Loan-to-Value Ratio at origination ("LTV");
(j) the
rate at which the
Subservicing Fee
accrues ("SUBSERV
FEE")
and at which the Servicing Fee accrues ("MSTR SERV FEE");
(k) a
code "T," "BT" or "CT" under the column "LN FEATURE,"
indicating that the
Mortgage Loan is secured by a second or
vacation residence; and
(l) a code
"N" under the column
"OCCP CODE," indicating that the
Mortgage Loan is secured by a non-owner occupied residence.
Such schedule may consist of multiple reports that collectively set
forth all of
the information required.
Non-Discount Mortgage
Loan: The mortgage
loans other than the Discount
Mortgage Loans.
Notional Amount: As of any Distribution Date, with respect to the
Class
A-9 Certificates,
an amount equal to the
Certificate Principal
Balance of the
Class A-8 Certificates
immediately prior to such date, provided, however, for
federal income tax purposes, as of any Distribution Date, with respect to the
Class A-9
Certificates, the
equivalent
of the foregoing, expressed as the
Uncertificated
Principal Balance of
Uncertificated REMIC I
Regular Interest V
immediately prior to that date. As of any Distribution Date, with
respect to the
Class A-12
Certificates,
an amount equal to the 2/25th of the aggregate
Certificate Principal
Balances of the Class A-3 and Class A-4 Certificates
immediately prior to
such date,
provided, however, for federal income tax
purposes, as
of any Distribution Date, with respect to the Class A-12
Certificates, the
equivalent
of the foregoing, expressed as the sum of the
Uncertificated
Principal Balance of
Uncertificated REMIC I
Regular Interest T
immediately prior to that date and the Uncertificated Principal Balance of the
Uncertificated REMIC
Regular Interest U
immediately prior to
that date. As of
any Distribution
Date with respect to any Class A-V
Certificates,
an amount
equal to the aggregate Stated Principal Balance of the Mortgage Loans as
of the
day immediately
preceding such Distribution Date (or, with respect to the
initial Distribution
Date, at the close of
business on the Cut-off Date). For
federal income tax purposes, as of any Distribution Date, with respect to any
Class A-V Certificates
or Subclass thereof
issued pursuant to Section 5.01(c),
the aggregate Stated
Principal Balance of
the Mortgage Loans
corresponding to
the Uncertificated
REMIC I Regular Interests Z, and correspondingly, the
Uncertificated REMIC
II Regular Interests
Z, corresponding to such Class or
Subclass as of the day immediately preceding such Distribution Date (or, with
respect to the
initial Distribution Date, at the close of business on the
Cut-off Date).
Pass-Through Rate: With respect to the Class A Certificates
(other than
the Class A-V
Certificates, the
Adjustable Rate Certificates and the Principal
Only Certificates),
Class M Certificates, Class B Certificates and Class R
Certificates and any
Distribution
Date, the per annum rates set forth in
the
Preliminary Statement hereto.
o
With respect
to the Class A-8 Certificates and the initial
Interest Accrual Period, 5.97% per annum, and as to any
Interest
Accrual Period
thereafter, a per
annum rate equal to LIBOR plus
0.65%, subject to a
maximum rate equal to the related Available
Funds Cap and a minimum rate of 0.65% per annum.
o
With respect
to the Class A-9 Certificates and the initial
Interest Accrual Period, 0.28% per annum, and as to any
Interest
Accrual Period
thereafter,
will be a per annum
rate equal to
5.60% minus LIBOR,
with a maximum rate of
5.60% per annum and a
minimum rate of 0.00% per annum.
With respect to the Class A-V Certificates (other than any Subclass
thereof) and
any Distribution Date other than the initial Distribution Date, a rate equal
to
the weighted average,
expressed as a percentage, of the Pool Strip Rates of all
Mortgage Loans as of
the Due Date in the related Due Period, weighted on the
basis of the respective Stated Principal Balances of such Mortgage Loans as
of
the day immediately
preceding such Distribution Date. With respect to the Class
A-V Certificates and
the initial
Distribution Date, the
Pass-Through Rate
is
equal to 0.3128% per annum. With respect to any Subclass of Class A-V
Certificates and any
Distribution Date, a
rate equal to the weighted average,
expressed as a
percentage,
of the Pool Strip Rates of all Mortgage Loans
corresponding to
the Uncertificated Class A-V REMIC Regular Interests
represented by such
Subclass as of the Due Date in the
related Due Period,
weighted on the
basis of the
respective
Stated Principal Balances of such
Mortgage Loans as of the day immediately preceding such Distribution Date (or
with respect to the initial Distribution Date, at the close of business on
the
Cut-Off Date). The Principal Only Certificates have no Pass-Through
Rate and are
not entitled to Accrued Certificate Interest.
Pool Strip Rate: With
respect to each
Mortgage Loan, a per
annum rate
equal to the excess of (a) the Net Mortgage Rate of such Mortgage Loan over
(b)
the Discount Net Mortgage Rate (but not less than 0.00%) per
annum.
Prepayment Assumption: A prepayment assumption of 300% of the
prepayment
speed assumption,
used for determining the accrual of
original issue discount
and market discount
and premium on the
Certificates
for federal income tax
purposes. The
prepayment speed assumption assumes a constant rate of
prepayment
of Mortgage Loans of 0.2% per annum of the then outstanding
principal balance of
such Mortgage
Loans in the
first month of the life of the Mortgage Loans,
increasing by an additional 0.2% per annum in each
succeeding
month until the
thirtieth month, and a
constant 6% per annum rate of prepayment thereafter for
the life of the Mortgage Loans.
Prepayment
Distribution
Percentage: With
respect to any
Distribution
Date and each Class of Subordinate Certificates, under the applicable
circumstances set forth below, the respective percentages set forth
below:
(i) For
any Distribution
Date prior to the Distribution Date in
October 2011 (unless the Certificate Principal Balances of the
Senior Certificates
(other than the Class A-P Certificates) have
been reduced to zero), 0%.
(ii) For any
Distribution
Date for which
clause (i) above does not
apply, and on which
any Class of
Subordinate
Certificates
is
outstanding with a
Certificate Principal
Balance greater than
zero:
(a) in the case of the Class of Subordinate Certificates
then outstanding
with the Highest
Priority and each other Class
of Subordinate
Certificates
for which the
related Prepayment
Distribution Trigger has been satisfied, a fraction, expressed
as
a percentage, the numerator of which is the Certificate
Principal
Balance of such
Class immediately prior to such date and the
denominator of
which is the sum of the Certificate Principal
Balances immediately
prior to such date of (1) the Class of
Subordinate
Certificates then
outstanding
with the Highest
Priority and (2) all other Classes of Subordinate Certificates
for which the respective Prepayment Distribution Triggers have
been satisfied; and
(b) in the
case of each other Class of Subordinate
Certificates for which the Prepayment Distribution Triggers have
not been satisfied, 0%; and
(iii) Notwithstanding
the foregoing, if the application of the
foregoing percentages
on any Distribution Date as provided in
Section 4.02 of this Series Supplement (determined without
regard
to the proviso to the definition of "Subordinate Principal
Distribution Amount")
would result in a distribution in respect
of principal of any Class or Classes of Subordinate Certificates
in an amount greater
than the remaining
Certificate
Principal
Balance thereof (any such class, a "Maturing Class"), then: (a)
the Prepayment
Distribution
Percentage of each
Maturing Class
shall be reduced to a
level that,
when applied as described
above, would exactly reduce the Certificate Principal Balance of
such Class to zero; (b) the Prepayment Distribution Percentage
of
each other Class of Subordinate Certificates (any such Class, a
"Non-Maturing Class")
shall be recalculated
in accordance with
the provisions in
paragraph (ii) above,
as if the Certificate
Principal Balance of each Maturing Class had been reduced to
zero
(such percentage as recalculated, the "Recalculated
Percentage");
(c) the total amount of the reductions in the Prepayment
Distribution
Percentages of
the Maturing Class or Classes
pursuant to
clause (a) of this sentence, expressed as an
aggregate percentage,
shall be allocated
among the Non-Maturing
Classes in
proportion
to their respective Recalculated
Percentages (the portion of such aggregate reduction so
allocated
to any
Non-Maturing Class, the "Adjustment Percentage"); and (d)
for purposes
of such Distribution Date, the Prepayment
Distribution Percentage of each Non-Maturing Class shall be
equal
to the sum of (1) the Prepayment Distribution Percentage
thereof,
calculated in accordance with the provisions in paragraph
(ii)
above as if the
Certificate Principal
Balance of each
Maturing
Class had not
been reduced to zero, plus (2) the related
Adjustment Percentage.
Principal Only Certificates: Any one of the Class A-P
Certificates.
Record Date: With
respect to each
Distribution Date and
each Class of
Certificates (other
than the Adjustable
Rate Certificates
for so long as the
Adjustable Rate
Certificates are in book-entry form), the close of business
on
the last Business Day of the month next preceding the month in
which the related
Distribution Date
occurs. With respect to each Distribution Date and the
Adjustable Rate Certificates (so long as they are Book-Entry
Certificates), the
close of business on the Business Day prior to such Distribution
Date.
Related Classes:
As to any Uncertificated REMIC I Regular Interest,
those classes of Certificates identified as "Related Classes of
Certificates" to
such Uncertificated REMIC I Regular Interest in the definition of
Uncertificated
REMIC I Regular Interest.
REMIC I: The
segregated pool of
assets with
respect to which a
REMIC
election is to be made, consisting of:
(i) the Mortgage Loans and the related Mortgage Files and
collateral securing such Mortgage Loans,
(ii) all payments
and collections in respect of the Mortgage
Loans due after the Cut-off Date (other than Monthly Payments due
in the
month of the Cut-off
Date and any
payments received under the Yield
Maintenance Agreement and on deposit in the Reserve Fund) as shall
be on
deposit in the
Custodial Account
or in the Certificate Account and
identified as belonging to the Trust Fund,
(iii) property
which secured a
Mortgage Loan and which has been
acquired for the benefit of the Certificateholders by foreclosure or
deed in lieu of foreclosure,
(iv) the hazard insurance policies and Primary Insurance
Policies, if any, and
(v) all proceeds of clauses (i) through (iv) above.
REMIC I Certificates:
The Class R-I Certificates.
REMIC II: The segregated pool of assets consisting of the
Uncertificated
REMIC I Regular
Interests conveyed
in trust to the
Trustee for the benefit of
the holders
of each Class of Certificates (other than the Class R-I
Certificates) pursuant
to Section 2.06, with
respect to which a separate REMIC
election is to be made.
Reserve Fund: The separate account created and maintained on behalf
of
the Class A-8
Certificates pursuant
to Section 4.10,
which shall be
entitled
"Reserve Fund,
U.S. Bank National
Association,
as Trustee for the
benefit of
holders of
Residential
Funding
Mortgage
Securities
I, Inc., Mortgage
Pass-Through Certificates, Series 2006-S9."
Senior Certificate:
Any one of the
Class A Certificates or Class R
Certificates, executed
by the Trustee and authenticated by the Certificate
Registrar
substantially in the
form annexed to the Standard Terms as Exhibit A
and Exhibit D, respectively.
Senior Percentage: As of any Distribution Date, the lesser of 100%
and a
fraction, expressed as
a percentage,
the numerator of which is the
aggregate
Certificate Principal
Balance of the Senior
Certificates (other than the Class
A-P
Certificates)
immediately prior
to such Distribution Date and the
denominator of which
is the aggregate
Stated Principal
Balance of all of
the
Mortgage Loans (or
related REO
Properties)
(other than the
related Discount
Fraction of each Discount Mortgage Loan) immediately prior
to such Distribution
Date.
Senior Principal
Distribution Amount:
As to any Distribution Date, the
lesser of (a) the balance of the Available Distribution Amount remaining after
the distribution of all amounts required to be distributed
pursuant to
Section
4.02(a)(i) and
Section 4.02(a)(ii)(X) (excluding any amount distributable
pursuant to Section 4.02(b)(i)(E)) (or, on or after the Credit
Support Depletion
Date, the amount required to be distributed to the Class A-P
Certificateholders
pursuant to Section
4.02(c)) and (b) the sum of the
amounts required to be
distributed to the Senior Certificateholders on such
Distribution Date pursuant
to Section 4.02(a)(ii)(Y).
Special Hazard Amount:
As of any Distribution
Date, an amount equal to
$4,423,179 minus the
sum of (i) the aggregate amount of Special Hazard Losses
allocated solely to
one or more specific
Classes of Certificates in accordance
with Section 4.05 of this Series Supplement and (ii) the Adjustment
Amount (as
defined below) as most recently calculated. For each anniversary of the
Cut-off
Date, the Adjustment
Amount shall be equal to the amount, if any, by which the
amount calculated in
accordance with the
preceding sentence
(without giving
effect to the deduction of the Adjustment Amount for such
anniversary)
exceeds
the greater of (A) the greatest of (i) twice the outstanding
principal balance
of the Mortgage
Loan in the
Trust Fund which has the largest outstanding
principal
balance on
the Distribution Date immediately preceding such
anniversary, (ii) the
product of 1.00% multiplied by the outstanding principal
balance of all Mortgage Loans on the Distribution Date immediately preceding
such anniversary and (iii) the aggregate outstanding principal balance (as of
the immediately preceding Distribution Date) of the Mortgage Loans
in any single
five-digit California zip code area with the largest amount of
Mortgage Loans by
aggregate principal
balance as of such
anniversary and (B)
the greater of (i)
the product of 0.50%
multiplied by the
outstanding
principal balance of all
Mortgage Loans on the Distribution Date immediately preceding such anniversary
multiplied by a
fraction, the numerator of which is equal to the
aggregate
outstanding principal
balance (as of the
immediately
preceding Distribution
Date) of all of the Mortgage Loans secured by Mortgaged
Properties
located in
the State of California divided by the aggregate outstanding principal balance
(as of the immediately
preceding Distribution Date) of all of the Mortgage
Loans, expressed as a percentage, and the denominator of which is
equal to 33.4%
(which percentage is equal to the percentage of Mortgage Loans
initially secured
by Mortgaged
Properties
located in the State of California) and (ii) the
aggregate outstanding
principal balance (as of the immediately preceding
Distribution Date) of
the largest Mortgage Loan secured by a Mortgaged Property
located in the State of California.
The Special Hazard Amount may be further reduced by the Master Servicer
(including
accelerating the manner in which coverage is reduced) provided that
prior to any such
reduction, the
Master Servicer shall (i) obtain written
confirmation from each
Rating Agency that such reduction shall not reduce the
rating assigned to any
Class of Certificates
by such Rating
Agency below the
lower of the then-current rating or the rating assigned to
such Certificates as
of the Closing
Date by such
Rating Agency and (ii) provide a copy of such
written confirmation to the Trustee.
Subordinate
Principal
Distribution
Amount: With
respect to any
Distribution Date and each Class of Subordinate Certificates, (a)
the sum of (i)
the product of (x) the related Subordinate Class Percentage for such Class
and
(y) the aggregate of the amounts calculated for such Distribution Date under
clauses (1), (2) and (3) of Section 4.02(a)(ii)(Y)(A) of this Series
Supplement
(without giving effect
to the Senior
Percentage) to the
extent not payable to
the Senior
Certificates;
(ii) such Class's pro rata share, based on the
Certificate Principal
Balance of each Class
of Subordinate
Certificates then
outstanding, of the principal collections
described
in Section
4.02(a)(ii)(Y)(B)(b)
of this Series
Supplement (without
giving effect to
the
Senior Accelerated
Distribution
Percentage) to the extent such collections are
not otherwise
distributed to the Senior Certificates; (iii) the product of (x)
the related Prepayment
Distribution
Percentage
and (y) the
aggregate of all
Principal Prepayments
in Full received in the related
Prepayment
Period and
Curtailments received
in the preceding
calendar month (other
than the related
Discount Fraction of
such Principal
Prepayments in Full and Curtailments with
respect to a Discount
Mortgage Loan) to the extent not
payable to the
Senior
Certificates; (iv) if
such Class is the Class of Subordinate Certificates with
the Highest
Priority, any Excess Subordinate Principal Amount for such
Distribution Date; and
(v) any amounts described in clauses (i), (ii) and (iii)
as determined for any previous Distribution Date, that remain
undistributed to
the extent that such amounts are not attributable to Realized Losses
which have
been allocated to a Class of Subordinate Certificates minus (b) the sum of (i)
with respect to the Class of Subordinate Certificates with the Lowest
Priority,
any Excess Subordinate Principal Amount for such Distribution Date;
and (ii) the
Capitalization
Reimbursement Amount
for such Distribution Date, other than the
related Discount Fraction of any portion of that amount related to
each Discount
Mortgage Loan,
multiplied
by a fraction, the numerator of which is the
Subordinate Principal
Distribution
Amount for such Class of Subordinate
Certificates, without
giving effect to this clause (b)(ii), and the denominator
of which is the sum of the principal distribution amounts for all Classes of
Certificates other than the Class A-P Certificates, without giving
effect to any
reductions for the Capitalization Reimbursement Amount.
Super Senior Optimal Percentage: As to any Distribution Date on or
after
the Credit Support
Depletion Date, a
fraction expressed as
a percentage, the
numerator of
which is the
Certificate
Principal Balance of the Class A-1
Certificates
immediately prior to that Distribution Date and the denominator
of
which is the aggregate
Certificate Principal Balance of the Senior Certificates
(other than the Class A-P Certificates) immediately prior to that
Distribution
Date.
Super Senior
Optimal
Principal
Distribution
Amount
As to any
Distribution Date on or after the Credit Support Depletion Date, an
amount equal
to the product of (a) the then applicable Super Senior Optimal Percentage and
(b) the amounts
described in clause (b) of the definition of Senior Principal
Distribution Amount.
Targeted Principal Balance: With respect to each Distribution
Date, the
targeted principal
balance set forth for
that Distribution Date
for the Class
A-5 Certificates in Exhibit Six hereto.
Trust Fund: The
segregated pool of assets consisting of:
(i) the
Mortgage Loans and the related Mortgage Files and collateral
securing such Mortgage Loans,
(ii) all
payments on and
collections in respect of the Mortgage Loans
due after the Cut-off
Date (other than
Monthly Payments due
in
the month of the Cut-off Date, any payments received under the
Yield Maintenance Agreement and amounts on deposit in the
Reserve
Fund) as shall be on deposit in the Custodial Account or in the
Certificate Account and identified as belonging to the Trust
Fund
but not including
amounts on deposit in the Initial Monthly
Payment Fund,
(iii) property
that secured a
Mortgage Loan and that has been acquired
for the benefit of the
Certificateholders by foreclosure or deed
in lieu of foreclosure,
(iv) the hazard
insurance policies and Primary Insurance Policies, if
any,
(v) the
Initial Monthly Payment Fund,
(vi) with
respect to the Class A-8 Certificates, the Yield Maintenance
Agreement; and
(vii) all proceeds of
clauses (i) through (vi) above.
Uncertificated Accrued Interest: With respect to each Distribution
Date,
(i) as to each Uncertificated REMIC I Regular Interest other than each
Uncertificated REMIC I
Regular Interest
Z, an amount
equal to the
aggregate
amount of Accrued Certificate Interest that would result under
the terms of the
definition thereof
on the Related Classes of Certificates (excluding any
Interest Only
Certificates) if the Pass-Through Rate on such Classes were
equal
to the Uncertificated
Pass-Through Rate on such Uncertificated REMIC I Regular
Interest, and (ii) as to each Uncertificated REMIC I Regular
Interest Z and each
Uncertificated REMIC
II Regular Interest Z, an amount equal to their respective
Uncertificated
Pass-Through Rates reduced by such Certificate's pro-rata share
of any prepayment
interest shortfalls or other reductions of interest allocable
to the Class A-V Certificates, pursuant to Section 4.02.
Uncertificated
Pass-Through
Rate: With
respect to each of the
Uncertificated REMIC I
Regular Interest,
other than the Uncertificated REMIC I
Regular Interests
Z, the per annum rate specified in the definition of
Uncertificated REMIC I
Regular Interests.
With respect to each
Uncertificated
REMIC I Regular
Interest Z, the Pool Strip Rate for the related Mortgage Loan,
and with respect to each Uncertificated REMIC II Regular Interest
Z, 100% of the
Uncertificated
Pass-Through
Rate on the related identically numbered
Uncertificated REMIC I Regular Interest Z.
Uncertificated
Principal Balance:
With respect to each
Uncertificated
REMIC I Regular
Interest, other than the Uncertificated REMIC I Regular
Interests Z, as
defined in the
definition of
Uncertificated
REMIC I Regular
Interest.
Uncertificated REMIC I
Regular Interests: The
Uncertificated
REMIC I
Regular Interests Z
together with the interests identified in the table below,
each representing an
undivided beneficial
ownership interest in REMIC I, and
having the following characteristics:
1. The principal balance from time to time of each
Uncertificated
REMIC I Regular
Interest identified
in the table
below shall be the
amount identified
as the Initial Principal Balance thereof in such
table, minus the sum
of (x) the aggregate
of all amounts previously
deemed distributed
with respect to such
interest and applied to reduce
the Uncertificated
Principal
Balance thereof pursuant to Section
10.04(a)(ii) and (y)
the aggregate of all
reductions
in Certificate
Principal Balance
deemed to have
occurred in connection
with Realized
Losses that were
previously
deemed allocated to the Uncertificated
Principal Balance
of such Uncertificated REMIC I Regular Interest
pursuant to Section
10.04(d), which equals the aggregate principal
balance of the Classes
of Certificates
identified
as related to such
Uncertificated REMIC I Regular Interest in such table.
2. The Uncertificated
Pass-Through Rate for each Uncertificated
REMIC I Regular Interest identified in the table below
shall be the per
annum rate set forth in the Pass-Through Rate column of such
table.
3. The Uncertificated
REMIC I Distribution Amount for each REMIC
I Regular Interest
identified
in the table
below shall be, for any
Distribution Date, the
amount deemed
distributed with
respect to such
Uncertificated REMIC
I Regular Interest on such Distribution Date
pursuant to the provisions of Section 10.04(a).
<TABLE>
<CAPTION>
------------------------- -------------------------
--------------------- -----------------------
UNCERTIFICATED REMIC I
RELATED
CLASSES OF
INITIAL PRINCIPAL
REGULAR
INTEREST
CERTIFICATES
PASS-THROUGH RATE
BALANCE
------------------------- -------------------------
--------------------- -----------------------
------------------------- -------------------------
--------------------- -----------------------
<S>
<C>
<C>
<C>
<C>
T
Class A-3, Class A-12
6.25%
$108,945,000
------------------------- -------------------------
--------------------- -----------------------
------------------------- -------------------------
--------------------- -----------------------
U
Class A-4, Class A-12
6.25%
$34,965,000
------------------------- -------------------------
--------------------- -----------------------
------------------------- -------------------------
--------------------- -----------------------
V
Class A-8, Class A-9
6.25%
$53,500,000
------------------------- -------------------------
--------------------- -----------------------
------------------------- -------------------------
--------------------- -----------------------
W
Class A-P
0.00%
$205,694
------------------------- -------------------------
--------------------- -----------------------
------------------------- -------------------------
--------------------- -----------------------
Class A-1, Class A-2,
6.25%
$244,702,051
Y
Class A-5, Class A-6,
Class A-7, Class A-10,
Class A-11, Class
R-II, Class
M-1, Class M-2, Class M-3, Class B-1, Class B-2, Class
B-3
------------------------- -------------------------
--------------------- -----------------------
</TABLE>
Uncertificated REMIC I
Regular Interests Z: The 858 uncertificated
partial undivided
beneficial ownership
interests in the Trust
Fund, numbered
sequentially from
1 to 858, each relating to the particular Non-Discount
Mortgage Loan
identified by
sequential number on
the Mortgage Loan
Schedule,
each having no principal balance, and each bearing interest at the respective
Pool Strip Rate on the Stated Principal Balance of the related
Mortgage Loan.
Uncertificated REMIC I
Regular Interests Z
Distribution Amount:
With
respect to
any Distribution Date, the sum of the amounts deemed to be
distributed on
the Uncertificated REMIC I Regular Interests Z for such
Distribution Date pursuant to Section 10.04(a).
Uncertificated REMIC I
Regular Interest Distribution Amounts: With
respect to each
Uncertificated
REMIC I Regular Interest, other than the
Uncertificated REMIC
I Regular Interests Z, the amount specified as the
Uncertificated REMIC I Regular Interest Distribution Amount with
respect thereto
in the definition of Uncertificated REMIC I Regular Interests.
With respect to
the Uncertificated
REMIC I Regular
Interests Z, the Uncertificated REMIC I
Regular Interests Z Distribution Amount.
Uncertificated
REMIC II Regular Interests Z: Each of the 858
uncertificated partial
undivided beneficial ownership interests in REMIC II
relating to a particular Uncertificated REMIC I Regular
Interest Z, each having
no principal
balance and bearing interest at a rate equal to 100% of the
Uncertificated
Pass-Through Rate on the related Uncertificated REMIC I Regular
Interest Z, comprising
such Uncertificated
REMIC II Regular
Interest Z's pro
rata share of the amount distributed pursuant to Section
10.04(a).Uncertificated
REMIC II Regular Interests Distribution Amount: With respect to any
Distribution
Date, the sum of the
amounts deemed to be
distributed
on the Uncertificated
REMIC II Regular
Interests Z for such
Distribution
Date pursuant to Section
10.04(a).
Yield Maintenance
Agreement:
The novation and
confirmation (which
is
Exhibit A to the
novation), dated as of
the Closing Date,
between the Trustee
and the Yield Maintenance Agreement Provider, relating to the Class A-8
Certificates, or any replacement, substitute, collateral or other
arrangement in
lieu thereof or related thereto.
Yield Maintenance
Agreement Provider: The Bear Stearns Financial
Products Inc. and its
successors and assigns
or any party to any
replacement,
substitute, collateral or other arrangement in lieu thereof.
Yield Maintenance Agreement Termination Payment: Upon the
designation of
an "Early Termination Date" as defined in the related Yield Maintenance
Agreement, the payment to be made by the Yield Maintenance
Agreement Provider to
the Trustee
for payment to the Trust Fund
pursuant to the terms
of the Yield
Maintenance Agreement.
Yield Maintenance
Payment: For any
Distribution Date, the payment, if
any, to be paid
under the Yield Maintenance Agreement in respect of such
Distribution Date.
With respect to any Distribution Date and the Class A-8
Certificates, the
Yield Maintenance
Payment shall be the amount equal to
the
product of (I) the
positive excess,
if any, of (a) the
lesser of (x) LIBOR or
(y) 8.85%,
over (b) 5.60% per
annum, and (II) the amount set forth for that
Distribution Date in Schedule I of the Yield Maintenance Agreement,
and (III) a
fraction, the numerator of which is 30 and the denominator of which
is 360.
Yield Supplement
Amount: With respect
to any Distribution Date and the
Class A-8
Certificates, an
amount equal to the
product of (I) the positive
excess, if any, of (a)
the lesser of (x) LIBOR or (y) 8.85%, over (b) 5.60% per
annum, and (II) the Certificate Principal Balance of the Class A-8
Certificates
immediately prior to the related Distribution Date, and (III) a fraction,
the
numerator of which is 30 and denominator of which is 360.
Section 1.02 Use
of Words and Phrases.
"Herein," "hereby," "hereunder," "hereof," "hereinbefore,"
"hereinafter"
and other equivalent
words refer to the
Pooling and Servicing
Agreement as a
whole. All references herein to Articles, Sections or Subsections
shall mean the
corresponding
Articles, Sections and
Subsections in the
Pooling and Servicing
Agreement. The
definitions
set forth herein
include both the singular and the
plural.
References in the Pooling and Servicing Agreement to "interest" on and
"principal" of the
Mortgage Loans shall mean, with respect to the Sharia
Mortgage Loans,
amounts in respect profit payments and acquisition payments,
respectively.
Section 1.03
Determination of LIBOR.
LIBOR applicable to
the calculation of the
Pass-Through
Rates on the
Adjustable Rate
Certificates
for any Interest
Accrual Period (other
than the
initial Interest Accrual Period) will be determined as described
below:
With respect to each
Distribution Date,
LIBOR shall be
established by
the Trustee and, as to any Interest Accrual Period, will equal the rate for one
month United States
dollar deposits
that appears on the
Telerate Screen
Page
3750 of the Moneyline
Telerate Capital Markets Report as of 11:00 a.m., London
time, on the second
LIBOR Business Day
prior to the first day of such Interest
Accrual Period ("LIBOR Rate Adjustment Date"). "Telerate Screen
Page 3750" means
the display designated
as page 3750 on the Telerate Service (or such other page
as may replace page
3750 on that service for the purpose of displaying London
interbank offered
rates of major banks).
If such rate does not
appear on such
page (or such other page as may replace that page on that service, or if such
service is no
longer offered, any other service for displaying LIBOR or
comparable rates as may be selected by the Trustee after
consultation
with the
Master Servicer), the
rate will be the Reference Bank Rate. The "Reference Bank
Rate" will be
determined on the
basis of the rates at which deposits in U.S.
Dollars are offered by the reference banks (which shall be any
three major banks
that are engaged in transactions in the London interbank market,
selected by the
Trustee after
consultation with the
Master Servicer) as of 11:00 a.m., London
time, on the day
that is one
LIBOR Business Day prior to the immediately
preceding Distribution
Date to prime banks in the London interbank market for a
period of one month in amounts approximately equal to the
aggregate Certificate
Principal Balance of
the Adjustable Rate
Certificates then
outstanding.
The
Trustee will
request the principal placeCityLondon office of each of the
reference banks to
provide a quotation of its rate. If at least two such
quotations are provided, the rate will be the arithmetic
mean of the quotations
rounded up to the next
multiple of 1/16%. If on such date fewer than two
quotations are provided as requested, the rate will be the arithmetic mean of
the rates quoted by
one or more major
banks in New York City, selected by the
Trustee after consultation with the Master Servicer, as of 11:00 a.m., New York
City time, on such date for loans in U.S. Dollars to leading European banks
for
a period of one month in amounts approximately equal to the aggregate
Certificate
Principal
Balance of
the Adjustable Rate Certificates then
outstanding. If no
such quotations can be obtained, the rate will be LIBOR for
the prior Distribution
Date, or, in the case of the first LIBOR Rate Adjustment
Date, 5.32% per annum;
provided, however,
if, under the
priorities
described
above, LIBOR for a
Distribution
Date would be based on
LIBOR for the previous
Distribution Date for
the third consecutive
Distribution
Date, the Trustee
shall, after
consultation
with the Master Servicer, select an alternative
comparable index (over
which the Trustee has no control), used for determining
one-month Eurodollar
lending rates that is calculated and published (or
otherwise made
available) by an independent party. "LIBOR Business Day" means
any day other than (i)
a Saturday
or a Sunday or (ii) a
day on which
banking
institutions in the city of CityLondon, placecountry-regionEngland are
required
or authorized by law to be closed.
The establishment
of LIBOR by the
Trustee on any LIBOR Rate Adjustment
Date and the Master Servicer's subsequent calculation of the Pass-Through
Rates
applicable to each of the Adjustable Rate Certificates for the
relevant Interest
Accrual Period, in the absence of manifest error, will be final and
binding.
Promptly following
each LIBOR Rate
Adjustment
Date the Trustee
shall
supply the Master
Servicer with the
results of its
determination of LIBOR
on
such date.
Furthermore, the
Trustee will supply the Pass-Through Rates on each
of the Adjustable
Rate Certificates for the current and the immediately
preceding Interest
Accrual Period via the Trustee's internet website located at
http://www.usbank.com/mbs or which may be obtained by telephoning
the Trustee at
(800) 934-6802.
<PAGE>
ARTICLE II
ARTICLE II CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01
Conveyance of Mortgage Loans.
(a) (See Section 2.01(a) of the Standard Terms)
(b) (See Section 2.01(b) of the Standard Terms)
(c) (See Section 2.01(c) of the Standard Terms)
(d) (See Section 2.01(d) of the Standard Terms)
(e) (See Section 2.01(e) of the Standard Terms)
(f) (See Section 2.01(f) of the Standard Terms)
(g) (See Section 2.01(g) of the Standard Terms)
(h) (See Section 2.01(h) of the Standard Terms)
(i) In connection with such assignment, and contemporaneously with the
delivery
of this Agreement, the
Company delivered or caused to be delivered hereunder to
the Trustee,
the Yield Maintenance Agreement (the delivery of which shall
evidence that the
fixed payment for such Yield Maintenance Agreement has been
paid and the Trustee and the Trust Fund shall have no further
payment obligation
thereunder).
Section 2.02
Acceptance by Trustee.
(See Section 2.02 of the Standard Terms)
Section 2.03
Representations,
Warranties and Covenants of the Master Servicer
and the Company.
(a)
For representations,
warranties and
covenants of the Master Servicer,
see Section 2.03(a) of the Standard Terms.
(b)
The Company
hereby represents and warrants to the Trustee for the
benefit of
Certificateholders
that as of the
Closing Date (or, if
otherwise specified below, as of the date so specified):
(i)
No Mortgage Loan is 30
or more days
Delinquent in payment of principal
and interest
as of the Cut-off
Date and no Mortgage
Loan has been so
Delinquent
more than once in the
12-month period prior to the Cut-off
Date;
(ii) The
information
set forth in Exhibit
One hereto with
respect to each
Mortgage Loan or the
Mortgage Loans, as the case may be, is true
and
correct in
all material respects
at the date or dates
respecting which
such information is furnished;
(iii) The
Mortgage Loans are fully-amortizing (subject to interest only
periods, if
applicable),
fixed-rate mortgage
loans with level Monthly
Payments due, with respect to a majority of the Mortgage
Loans, on the
first day of each
month and terms to maturity at origination or
modification of not more than 30 years;
(iv) To
the best of the Company's knowledge, if a Mortgage Loan is secured
by
a Mortgaged Property with a Loan-to-Value Ratio at origination in
excess
of 80%, such Mortgage Loan is the subject of a Primary Insurance Policy
that insures that (a)
at least 30% of the Stated Principal Balance of
the Mortgage Loan at origination if the Loan-to-Value Ratio is between
95.00% and 90.01%, (b) at least 25% of such balance if the
Loan-to-Value
Ratio is between 90.00% and 85.01%, and (c) at least 12% of such
balance
if the Loan-to-Value
Ratio is between 85.00% and 80.01%. To the best of
the Company's
knowledge, each such
Primary Insurance Policy is in full
force and effect and the Trustee is entitled to the benefits
thereunder;
(v)
The issuers of the Primary Insurance Policies are insurance
companies
whose claims-paying
abilities are
currently acceptable
to each Rating
Agency;
(vi) No
more than 0.7% of the Mortgage Loans by aggregate Cut-off Date
Principal Balance are secured by Mortgaged Properties located in
any one
zip code area in the
State of Arizona and no more than 0.6% of the
Mortgage Loans by aggregate Cut-off Date Principal
Balance are
secured
by Mortgaged
Properties
located in any one zip
code area outside
the
State of Arizona;
(vii) The
improvements upon the Mortgaged Properties are insured against
loss
by fire and other
hazards as required by the Program Guide, including
flood insurance if
required under the National Flood Insurance Act of
1968, as amended. The
Mortgage requires the
Mortgagor to maintain such
casualty insurance at
the Mortgagor's
expense, and on the
Mortgagor's
failure to do so,
authorizes the holder
of the Mortgage to
obtain and
maintain such
insurance at the Mortgagor's expense and to seek
reimbursement therefor from the Mortgagor;
(viii) Immediately
prior to the assignment of the Mortgage Loans to the
Trustee, the Company
had good title to, and was the sole owner of, each
Mortgage Loan
free and clear of any pledge, lien, encumbrance or
security
interest (other
than rights to servicing and related
compensation) and such
assignment validly
transfers ownership of the
Mortgage Loans to the
Trustee free and clear of any pledge, lien,
encumbrance or security interest;
(ix) No
more than 33.27% of the Mortgage Loans by aggregate Cut-off Date
Principal Balance were underwritten under a reduced loan documentation
program;
(x)
Each Mortgagor
represented in its loan application with respect to
the
related
Mortgage
Loan
that
the Mortgaged Property would be
owner-occupied and therefore would not be an investor property as
of the
date of origination of such Mortgage Loan. No Mortgagor is a
corporation
or a partnership;
(xi) None
of the Mortgage Loans are Buydown Mortgage Loans;
(xii) Each
Mortgage Loan constitutes a qualified mortgage under Section
860G(a)(3)(A) of
the Code and Treasury Regulations Section
1.860G-2(a)(1);
(xiii) A policy of
title insurance
was effective as of the closing of each
Mortgage Loan and is
valid and binding
and remains in full force and
effect, unless the Mortgaged Properties are located in the State of
Iowa
and an attorney's
certificate
has been provided as described in the
Program Guide;
(xiv) Except
with respect to three Mortgage Loans, none of the Mortgage Loans
are Cooperative Loans;
(xv)
Except with respect to twelve Mortgage Loans, none of the Mortgage
Loans
were originated
under a "streamlined"
Mortgage Loan program
(through
which no new or updated appraisals of Mortgaged Properties are obtained
in connection with the
refinancing
thereof), the related Seller has
represented that either (a) the value of the related Mortgaged
Property
as of the date the Mortgage Loan was originated was not less than the
appraised value
of such property at the time of origination of the
refinanced Mortgage
Loan or (b) the Loan-to-Value Ratio of the Mortgage
Loan as of the date of origination of the Mortgage Loan generally
meets
the Company's underwriting guidelines;
(xvi) Interest
on each Mortgage
Loan is calculated on
the basis of a 360-day
year consisting of twelve 30-day months;
(xvii) None of the
Mortgage Loans contains in the related Mortgage File a
Destroyed Mortgage Note; and
(xviii) None of the
Mortgage Loans
are Pledged Asset Loans or Additional
Collateral Loans.
It is understood and agreed that the representations and warranties
set forth in
this Section 2.03(b) shall survive delivery of the respective
Custodial Files to
the Trustee or the Custodian.
Upon discovery by any of the Company, the Master Servicer,
the Trustee,
or the Custodian of a breach of any of the representations and warranties set
forth in this
Section 2.03(b) that materially and adversely affects the
interests of the
Certificateholders in any Mortgage Loan, the party discovering
such breach shall give prompt written notice to the other parties
(any Custodian
being so obligated under a Custodial Agreement); provided, however, that in the
event of a breach of
the representation
and warranty set forth in Section
2.03(b)(xii), the
party discovering
such breach shall give
such notice within
five days of discovery. Within 90 days of its discovery or its
receipt of notice
of breach,
the Company shall either (i) cure such breach in all material
respects or (ii) purchase such Mortgage Loan from the Trust Fund at
the Purchase
Price and in the manner set forth in Section 2.02; provided that the Company
shall have the option to substitute a Qualified Substitute Mortgage Loan or
Loans for such
Mortgage Loan if such substitution occurs within two years
following the Closing Date; provided that if the omission or
defect would cause
the Mortgage Loan to be other than a "qualified mortgage" as defined in
Section
860G(a)(3) of the Code, any such cure or repurchase must occur within 90 days
from the date such
breach was discovered. Any such substitution shall be
effected by the
Company under the same terms and
conditions
as provided in
Section 2.04 for
substitutions by
Residential
Funding. It is understood and
agreed that the
obligation of the Company to cure such breach or to so purchase
or substitute
for any Mortgage Loan
as to which such a breach has occurred and
is continuing shall constitute the sole remedy respecting such breach
available
to the
Certificateholders or
the Trustee on behalf of the Certificateholders.
Notwithstanding the
foregoing,
the Company shall not be required to cure
breaches or
purchase or substitute for Mortgage Loans as provided in this
Section 2.03(b) if the
substance of the
breach of a
representation set
forth
above also constitutes fraud in the origination of the Mortgage
Loan.
Section 2.04 Representations and Warranties of Residential Funding.
(See Section
2.04 of the Standard Terms)
Section 2.05
Execution and Authentication of Class R-I Certificates.
The Trustee
acknowledges the assignment to it of the Mortgage Loans and
the delivery
of the Custodial Files to it, or any Custodian on its behalf,
subject to any exceptions noted, together with the assignment to it
of all other
assets included
in the Trust
Fund, receipt of which is hereby
acknowledged.
Concurrently with such delivery and in exchange therefor, the
Trustee, pursuant
to the written request of the Company executed by an officer of the
Company has
executed and caused to be authenticated and delivered to or upon the order
of
the Company
the Class R-I Certificates in authorized denominations which
together with
the Uncertificated REMIC I Regular Interests, evidence the
beneficial interest in REMIC I.
Section 2.06
Conveyance of
Uncertificated
REMIC
I and REMIC II Regular
Interests; Acceptance by the Trustee.
The Company, as of the Closing Date, and concurrently with the
execution
and delivery hereof,
does hereby assign without recourse all the right,
title
and interest
of the Company in and to the Uncertificated REMIC I Regular
Interests to the
Trustee for the benefit of the Holders of each Class of
Certificates (other than the Class R-I Certificates). The Trustee acknowledges
receipt of the
Uncertificated REMIC I
Regular Interests
and declares that
it
holds and will hold the same in trust for the exclusive use and benefit of all
present and future Holders of each Class of Certificates (other than the Class
R-I Certificates).
The rights of the
Holders of each Class of Certificates
(other than the Class
R-I Certificates) to receive distributions from the
proceeds of REMIC II in respect of such Classes, and all ownership interests of
the Holders of such Classes in such distributions shall be as set forth in this
Agreement.
Section 2.07 Issuance of Certificates Evidencing Interest in REMIC
II.
The Trustee
acknowledges the
assignment
to it of the
Uncertificated
REMIC I Regular Interests and, concurrently therewith and in exchange
therefor,
pursuant to the
written request of the
Company executed by an officer of the
Company, the Trustee
has executed and caused to be authenticated and delivered
to or upon the order of the Company, all Classes of Certificates
(other than the
Class R-I Certificates) in authorized denominations, which evidence the
beneficial interest in the entire REMIC II.
Section 2.08 Purposes and Powers of the Trust. (See Section 2.08 of
the Standard
Terms).
Section 2.09
Agreement Regarding Ability to Disclose.
The Company,
the Master Servicer and the Trustee hereby agree,
notwithstanding any other express or implied agreement to the
contrary, that any
and all Persons, and
any of their respective employees, representatives, and
other agents may disclose, immediately upon commencement of
discussions, to any
and all Persons,
without limitation
of any kind,
the tax treatment and tax
structure of the transaction and all materials of any kind
(including
opinions
or other tax analyses)
that are provided to any of them
relating to such
tax
treatment and tax
structure.
For purposes of this
paragraph,
the terms "tax
treatment" and "tax
structure"
are defined under Treasury Regulation ss.
1.6011-4(c).
<PAGE>
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
Section 3.01 Master
Servicer to Act as Servicer. (See Section 3.01 of the
Standard Terms)
Section 3.02 Subservicing Agreements Between Master Servicer and
Subservicers;
Enforcement of Subservicers' and Sellers' Obligations.
(a) The Master Servicer may continue in effect Subservicing Agreements entered
into by Residential Funding and Subservicers prior to the execution
and delivery
of this Agreement, and may enter into new Subservicing Agreements with
Subservicers, for
the servicing and administration of all or some of the
Mortgage Loans. Each Subservicer shall be either (i) an institution
the accounts
of which are insured
by the FDIC or (ii)
another entity
that engages in the
business of originating or servicing mortgage loans, and in either
case shall be
authorized to
transact business in the state or states in which
the related
Mortgaged Properties
it is to service are situated, if and to the extent
required by applicable law to enable the Subservicer to perform its
obligations
hereunder and under the Subservicing Agreement, and in either case shall be a
Freddie Mac, Fannie
Mae or HUD approved
mortgage servicer.
In addition,
any
Subservicer of a
Mortgage Loan insured by the FHA must be an FHA-approved
servicer, and any
Subservicer of a Mortgage Loan guaranteed by the VA must be a
VA-approved servicer.
Each Subservicer of a
Mortgage Loan shall be entitled to
receive and retain, as
provided in the related Subservicing Agreement and in
Section 3.07, the related Subservicing Fee from payments of
interest received on
such Mortgage Loan
after payment of all amounts required to be remitted to the
Master Servicer in
respect of such Mortgage Loan. For any Mortgage Loan that is
a Nonsubserviced Mortgage Loan, the Master Servicer shall be
entitled to receive
and retain an amount equal to the Subservicing Fee from payments of interest.
Unless the context otherwise requires, references in this Agreement to
actions
taken or to be taken by the Master Servicer in servicing the Mortgage Loans
include actions taken
or to be taken by a
Subservicer on behalf
of the Master
Servicer. Each
Subservicing Agreement will be upon such terms and conditions
as
are generally required by, permitted by or consistent with the
Program Guide and
are not inconsistent
with this Agreement and as the Master Servicer and the
Subservicer have agreed; provided that, the Subservicing
Agreement between
the
Master Servicer and
Wells Fargo, if any, will be upon such terms and conditions
as are consistent
with this Agreement and as the Master Servicer and the
Subservicer have
agreed, which may not
be consistent with the
Program Guide.
With the approval
of the Master
Servicer, a Subservicer may delegate its
servicing obligations to third-party servicers, but such
Subservicer will remain
obligated under the related Subservicing Agreement. The Master Servicer and a
Subservicer may
enter into amendments thereto or a different form of
Subservicing
Agreement, and the
form referred
to or included in the Program
Guide is merely provided for information and shall not be deemed to
limit in any
respect the discretion of the Master Servicer to modify or enter into
different
Subservicing
Agreements;
provided, however,
that any such amendments or
different forms shall
be consistent
with and not violate
the provisions of
either this Agreement
or the Program Guide
in a manner which would materially
and adversely affect the interests of the Certificateholders.
The Program Guide
and any other
Subservicing Agreement
entered into between
the Master Servicer
and any Subservicer shall require the Subservicer to accurately and
fully report
its borrower credit files to each of the Credit Repositories in a
timely manner.
(b) (See Section 3.02(b) of the Standard Terms)
Section 3.03
Successor Subservicers. (See Section 3.03 of the Standard
Terms)
Section 3.04 Liability of the Master Servicer. (See Section 3.04 of
the Standard
Terms)
Section 3.05 No
Contractual
Relationship Between
Subservicer
and Trustee or
Certificateholders. (See Section 3.05 of the Standard Terms)
Section 3.06
Assumption or Termination of Subservicing Agreements by Trustee.
(See Section 3.06 of the Standard Terms)
Section 3.07 Collection of Certain Mortgage Loan Payments; Deposits
to Custodial
Account. (See Section 3.07 of the Standard Terms)
Section 3.08 Subservicing Accounts; Servicing Accounts. (See
Section 3.08 of the
Standard Terms)
Section 3.09 Access to
Certain Documentation
and Information Regarding the
Mortgage Loans. (See Section 3.09 of the Standard Terms)
Section 3.10 Permitted Withdrawals from the Custodial Account. (See
Section 3.10
of the Standard Terms)
Section 3.11
Maintenance of
the Primary Insurance Policies; Collections
Thereunder. (See Section 3.11 of the Standard Terms)
Section 3.12 Maintenance of Fire Insurance and Omissions and
Fidelity Coverage.
(See Section 3.12 of the Standard Terms)
Section 3.13
Enforcement of Due-on-Sale Clauses; Assumption and Modification
Agreements; Certain
Assignments.
(See Section 3.13 of the Standard
Terms)
Section 3.14 Realization Upon Defaulted Mortgage Loans. (See
Section 3.14 of the
Standard Terms)
Section 3.15 Trustee to Cooperate; Release of Custodial Files. (See
Section 3.15
of the Standard Terms)
Section 3.16 Servicing
and Other Compensation; Compensating Interest. (See
Section 3.16 of the Standard Terms)
Section 3.17 Reports
to the Trustee and the
Company. (See Section
3.17 of the
Standard Terms)
Section 3.18 Annual
Statement as to Compliance. (See Section 3.18 of the
Standard Terms)
Section 3.19 Annual
Independent Public
Accountants'
Servicing Report. (See
Section 3.19 of the Standard Terms)
Section 3.20 Rights of
the Company in Respect
of the Master Servicer. (See
Section 3.20 of the Standard Terms)
Section 3.21
Administration of Buydown Funds. (See Section 3.21 of the
Standard
Terms)
Section 3.22 Advance Facility. (See Section 3.22 of the Standard
Terms)
<PAGE>
ARTICLE IV
PAYMENTS TO
CERTIFICATEHOLDERS
Section 4.01
Certificate Account.
(See Section 4.01 of the Standard Terms)
Section 4.02
Distributions.
(a)
On each Distribution
Date, (x) the Master Servicer on behalf of the
Trustee or
(y) the Paying Agent appointed by the Trustee, shall
distribute (I) to the Master Servicer or a sub-servicer,
in the case of
a distribution
pursuant to Section 4.02(a)(iii) below, the amount
required to be
distributed to the
Master Servicer
or a sub-servicer
pursuant to
Section
4.02(a)(iii)
below,
and (II) to each
Certificateholder of
record on the next
preceding Record
Date (other
than as provided in Section 9.01 respecting the final distribution),
either (1)
in immediately available funds (by wire transfer or
otherwise) to the account of such Certificateholder at a bank or other
entity having appropriate facilities therefor, if such
Certificateholder
has so notified the Master Servicer or the Paying Agent, as the
case may
be, or (2) if such
Certificateholder has
not so notified
the Master
Servicer or the Paying Agent by the Record Date, by check mailed to
such
Certificateholder at
the address of such Holder appearing in the
Certificate Register,
such
Certificateholder's
share (which share (A)
with respect to each Class of Certificates (other than any Subclass of
the Class A-V
Certificates),
shall be based on the
aggregate of the
Percentage Interests represented by Certificates of the applicable
Class
held by such Holder or (B) with respect to any Subclass of the
Class A-V
Certificates, shall be equal to the amount (if any) distributed
pursuant
to Section 4.02(a)(i) below to each Holder of a Subclass thereof)
of the
following amounts,
in the following order
of priority (subject
to the
provisions of Section 4.02(b) below), in each case to the extent of
the
Available Distribution Amount:
(i)
to the Senior
Certificates (other
than the Principal Only Certificates
and, prior
to the Accretion Termination Date for any Class of the
Accrual Certificates,
the related Class of
Accrual Certificates)
on a
pro rata basis based on the Accrued Certificate Interest payable on
such
Certificates with respect to such Distribution Date, Accrued
Certificate
Interest on such Classes of Certificates (or Subclasses, if any, with
respect to the
Class A-V Certificates) for such Distribution Date
(provided that for the purpose of this Section 4.02(a)(i) the Available
Funds Cap for the
Class A-8 Certificates shall be 6.25%), plus any
Accrued Certificate
Interest thereon remaining unpaid from any previous
Distribution Date,
except as provided in the last paragraph of this
Section 4.02(a) and, with respect to the Senior Support
Certificates and
Super Senior Certificates, except as provided in Section
4.02(c);
(ii) (X)
to the Class A-P Certificates, the Class A-P Principal
Distribution
Amount (as defined in Section 4.02(b)(i) herein), until the Certificate
Principal Balance
of the Class A-P
Certificates
has been reduced to
zero; and
(Y) (1) the Accrual Distribution Amount shall be
distributed concurrently as follows:
(A)
first, the Class A-7 Accrual Distribution Amount, to the
Class
A-5, Class
A-6 and Class A-7 Certificates in the order of
priority set forth in
Sections
4.02(b)(ii)(C)(1)(ii)
through
4.02(b)(ii)(C)(i)(v) below; and
(B)
second, the Class A-6 Accrual Distribution Amount, to the Class
A-5 and Class A-6
Certificates, in the
order of priority
set
forth in
sections
4.02(b)(ii)(C)(1)(ii) and
4.02(b)(ii)(C)(1)(iii) below.
(2) to the Senior
Certificates
(other than the
Class A-P Certificates), in the priorities and amounts set
forth
in Sections 4.02(b)(ii) through 4.02(d), the sum of the
following
(applied to reduce the
Certificate
Principal Balances of such
Senior Certificates, as applicable):
(A)
the Senior Percentage
for such Distribution
Date times the sum of
the
following:
(1)
the principal portion of each Monthly Payment due during the
related Due
Period on each
Outstanding
Mortgage Loan (other than the related
Discount Fraction of
the principal portion of such payment with respect
to a Discount Mortgage Loan), whether or not received on or prior
to the
related Determination
Date, minus the principal portion of any Debt
Service Reduction
(other than the related Discount Fraction of the
principal portion of
such Debt Service
Reductions with respect to each
Discount Mortgage
Loan) which
together with other
Bankruptcy
Losses
exceeds the Bankruptcy Amount;
(2)
the Stated Principal Balance of any Mortgage Loan repurchased
during the
preceding calendar
month (or deemed to have been so repurchased in
accordance with
Section 3.07(b) of the Standard Terms) pursuant to
Sections 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
preceding calendar
month (other than the related Discount Fraction of
such Stated Principal Balance or shortfall with respect to each
Discount
Mortgage Loan); and
(3)
the principal portion of all other unscheduled collections (other than
Principal Prepayments
in Full and
Curtailments and amounts received in
connection with a Cash Liquidation or REO Disposition of a Mortgage
Loan
described in Section
4.02(a)(ii)(Y)(2)(B)
of this Series
Supplement,
including without limitation Insurance Proceeds, Liquidation Proceeds
and REO Proceeds)
including Subsequent
Recoveries received
during the
preceding calendar
month (or deemed to have been so received in
accordance with
Section 3.07(b) of the
Standard Terms) to the extent
applied by the Master Servicer as recoveries of principal of the
related
Mortgage Loan pursuant to Section 3.14 of the Standard Terms (other
than
the related
Discount Fraction of the principal portion of such
unscheduled collections, with respect to each Discount Mortgage
Loan);
(B)
with respect to each Mortgage Loan for which a Cash Liquidation or
a REO
Disposition occurred
during the preceding calendar month (or was deemed
to have occurred
during such period in accordance with Section 3.07(b)
of the Standard Terms)
and did not result in any Excess Special Hazard
Losses, Excess Fraud
Losses, Excess
Bankruptcy Losses or Extraordinary
Losses, an amount
equal to the lesser of (a) the Senior Percentage for
such Distribution
Date times the Stated Principal Balance of such
Mortgage Loan (other than the related Discount Fraction of such Stated
Principal Balance,
with respect to each Discount Mortgage Loan) and (b)
the Senior Accelerated
Distribution
Percentage for such
Distribution
Date times
the related unscheduled collections (including without
limitation Insurance Proceeds, Liquidation Proceeds and REO
Proceeds) to
the extent applied by the Master Servicer as recoveries of
principal of
the related Mortgage Loan pursuant to Section 3.14 of the Standard
Terms
(in each case other than the portion of such unscheduled collections,
with respect
to a Discount Mortgage Loan, included in Section
4.02(b)(i)(C) of this Series Supplement);
(C)
the Senior Accelerated
Distribution
Percentage for such
Distribution
Date times the aggregate of all Principal Prepayments in Full received
in the related
Prepayment
Period and Curtailments received in the
preceding calendar
month (other than the related Discount Fraction of
such Principal
Prepayments in Full
and Curtailments,
with respect to
each Discount Mortgage Loan);
(D)
any Excess Subordinate Principal Amount for such Distribution
Date;
(E)
any amounts described in subsection (ii)(Y), clauses (A), (B) and
(C) of
this Section 4.02(a), as determined for any previous Distribution Date,
which remain unpaid after application of amounts previously
distributed
pursuant to this
clause (E) to the
extent that such
amounts are not
attributable to
Realized Losses which have been allocated to the
Subordinate Certificates; minus
(F)
the Capitalization
Reimbursement
Amount for such
Distribution
Date,
other than the related
Discount Fraction of
any portion of that amount
related to each Discount Mortgage Loan, multiplied by a fraction,
the
numerator of which is the Senior Principal Distribution Amount, without
giving effect to this
clause (F), and the
denominator of which
is the
sum of the principal distribution amounts for all Classes of
Certificates other
than the Class
A-P Certificates, without giving
effect to any reductions for the Capitalization Reimbursement
Amount;
(iii) if the
Certificate Principal
Balances of the
Subordinate
Certificates
have not been reduced to zero, to the Master Servicer or a
Sub-Servicer,
by remitting for deposit to the Custodial Account, to the extent of and
in reimbursement for
any Advances or Sub-Servicer Advances previously
made with respect to
any Mortgage
Loan or REO
Property which remain
unreimbursed in whole
or in part following the Cash Liquidation or REO
Disposition of such
Mortgage Loan or REO Property, minus any such
Advances that were made with respect to delinquencies that ultimately
constituted Excess
Special Hazard Losses,
Excess Fraud Losses,
Excess
Bankruptcy Losses or Extraordinary Losses;
(iv) to
the Holders of the Class M-1 Certificates, the Accrued Certificate
Interest thereon
for such Distribution Date, plus any Accrued
Certificate
Interest thereon
remaining
unpaid from any previous
Distribution Date, except as provided below;
(v)
to the Holders of the Class M-1 Certificates, an amount equal to
(x) the
Subordinate Principal Distribution Amount for such Class of
Certificates
for such Distribution
Date, minus (y) the amount of any Class A-P
Collection Shortfalls for such Distribution Date or remaining
unpaid for
all previous
Distribution Dates,
to the extent the
amounts available
pursuant to clause (x) of Sections 4.02(a)(vii), (ix), (xi), (xiii),
(xiv) and (xv) of this
Series Supplement
are insufficient therefor,
applied in reduction of the Certificate Principal Balance of the Class
M-1 Certificates;
(vi) to
the Holders of the Class M-2 Certificates, the Accrued Certificate
Interest thereon
for such Distribution Date, plus any Accrued
Certificate
Interest thereon
remaining
unpaid from any previous
Distribution Date, except as provided below;
(vii) to the
Holders of the Class M-2 Certificates, an amount equal to (x)
the
Subordinate Principal Distribution Amount for such Class of
Certificates
for such Distribution
Date, minus (y) the amount of any Class A-P
Collection Shortfalls for such Distribution Date or remaining
unpaid for
all previous
Distribution Dates,
to the extent the
amounts available
pursuant to clause (x) of Sections 4.02(a)(ix), (xi), (xiii), (xiv) and
(xv) of this Series
Supplement are
insufficient therefor,
applied in
reduction of
the Certificate Principal Balance of the Class M-2
Certificates;
(viii) to the Holders
of the Class M-3
Certificates, the
Accrued
Certificate
Interest thereon
for such Distribution Date, plus any Accrued
Certificate
Interest thereon
remaining
unpaid from any previous
Distribution Date, except as provided below;
(ix) to
the Holders of the Class M-3 Certificates, an amount equal to (x)
the
Subordinate Principal Distribution Amount for such Class of
Certificates
for such Distribution
Date minus (y) the amount of any Class A-P
Collection Shortfalls for such Distribution Date or remaining
unpaid for
all previous
Distribution Dates,
to the extent the
amounts available
pursuant to clause (x) of Sections 4.02(a)(xi), (xiii), (xiv) and (xv)
of this Series Supplement are insufficient therefor, applied in
reduction of
the Certificate Principal Balance of the Class M-3
Certificates;
(x)
to the Holders of the Class B-1 Certificates, the Accrued Certificate
Interest thereon
for such Distribution Date, plus any Accrued
Certificate
Interest thereon
remaining
unpaid from any previous
Distribution Date, except as provided below;
(xi) to
the Holders of the Class B-1 Certificates, an amount equal to (x)
the
Subordinate Principal Distribution Amount for such Class of
Certificates
for such Distribution
Date minus (y) the amount of any Class A-P
Collection Shortfalls for such Distribution Date or remaining
unpaid for
all
previous Distribution
Dates, to the extent the amounts
available
pursuant to clause (x) of Sections 4.02(a)(xiii), (xiv) and (xv) of
this
Series Supplement are insufficient therefor, applied in reduction
of the
Certificate Principal Balance of the Class B-1 Certificates;
(xii) to the
Holders of the Class B-2 Certificates, the Accrued Certificate
Interest thereon
for such Distribution Date, plus any Accrued
Certificate
Interest thereon
remaining
unpaid from any previous
Distribution Date, except as provided below;
(xiii) to the Holders
of the Class B-2 Certificates, an amount equal to (x) the
Subordinate Principal Distribution Amount for such Class of
Certificates
for such Distribution
Date minus (y) the amount of any Class A-P
Collection Shortfalls for such Distribution Date or remaining
unpaid for
all previous
Distribution Dates,
to the extent the
amounts available
pursuant to clause (x) of Sections 4.02(a)(xiv) and (xv) of this
Series
Supplement are
insufficient
therefor, applied in reduction of the
Certificate Principal Balance of the Class B-2 Certificates;
(xiv) to the
Holders of the Class B-3 Certificates, an amount equal to (x)
the
Accrued Certificate
Interest thereon for
such Distribution
Date, plus
any Accrued
Certificate
Interest thereon remaining unpaid from any
previous Distribution
Date, except as provided below, minus (y) the
amount of any Class A-P Collection Shortfalls for such Distribution
Date
or remaining unpaid for all previous Distribution Dates, to the extent
the amounts available
pursuant to clause (x) of Section 4.02(a)(xv) of
this Series Supplement are insufficient therefor;
(xv) to
the Holders of the Class B-3 Certificates, an amount equal to (x)
the
Subordinate Principal Distribution Amount for such Class of
Certificates
for such Distribution
Date minus (y) the amount of any Class A-P
Collection Shortfalls for such Distribution Date or remaining
unpaid for
all previous Distribution Dates, applied in reduction of the
Certificate
Principal Balance of the Class B-3 Certificates;
(xvi) to the
Senior Certificates, in the priority set forth in Section
4.02(b)
of this Series Supplement, the portion, if any, of the Available
Distribution Amount remaining after the foregoing distributions,
applied
to reduce the Certificate Principal Balances of such Senior
Certificates, but in no event more than the aggregate of the
outstanding
Certificate
Principal
Balances of
each such Class of Senior
Certificates, and
thereafter, to each Class of Subordinate Certificates
then outstanding
beginning with such
Class with the Highest
Priority,
any portion of the Available Distribution Amount remaining after the
Senior Certificates have been retired, applied to reduce the
Certificate
Principal Balance of each such Class of Subordinate Certificates,
but in
no event more than the outstanding Certificate Principal Balance of
each
such Class of Subordinate Certificates; and
(xvii) to the Class
R-II Certificates,
the balance,
if any, of the
Available
Distribution Amount.
Notwithstanding the foregoing, on any Distribution Date, with
respect to
the Class of Subordinate Certificates outstanding on such
Distribution Date with
the Lowest Priority, or in the event the Subordinate Certificates are no longer
outstanding, the
Senior Certificates,
Accrued Certificate Interest thereon
remaining unpaid from any previous Distribution Date will be
distributable only
to the extent that (1)
a shortfall
in the amounts available to pay Accrued
Certificate Interest
on any Class of Certificates results from an interest rate
reduction in
connection
with a Servicing Modification, or (2) such unpaid
Accrued Certificate Interest was attributable to interest
shortfalls relating to
the failure
of the Master Servicer to make any required Advance, or the
determination by the
Master Servicer that any proposed Advance would be a
Nonrecoverable Advance
with respect to the related
Mortgage Loan where such
Mortgage Loan
has not yet been the subject of a Cash Liquidation or REO
Disposition or the
related Liquidation
Proceeds, Insurance Proceeds and REO
Proceeds have not yet been distributed to the
Certificateholders.
(b)
Distributions of
principal on the Senior Certificates on each
Distribution
Date occurring
prior to the Credit Support
Depletion Date will be made as follows:
(i)
to the Class A-P Certificates, until the Certificate
Principal
Balance thereof is
reduced to zero, an
amount (the "Class A-P
Principal Distribution Amount") equal to the aggregate of:
(A)
the related Discount
Fraction of the principal portion of each
Monthly Payment on
each Discount Mortgage
Loan due during the
related Due Period,
whether or not received on or prior to the
related Determination
Date, minus the Discount Fraction of the
principal portion of
any related Debt Service Reduction which
together with other
Bankruptcy Losses
exceeds the
Bankruptcy
Amount;
(B)
the related
Discount Fraction of the principal portion of all
unscheduled
collections on each Discount Mortgage Loan received during
the preceding calendar month or, in the case of Principal
Prepayments in
Full, during the related Prepayment Period (other than
amounts received
in connection with a
Cash Liquidation or
REO Disposition of a Discount
Mortgage Loan
described in clause (C) below), including Principal
Prepayments in Full, Curtailments, Subsequent Recoveries and
repurchases
(including deemed
repurchases
under Section 3.07(b) of the Standard
Terms) of Discount
Mortgage Loans (or, in the case of a substitution of
a Deleted Mortgage
Loan, the Discount Fraction of the amount of any
shortfall deposited in
the Custodial Account
in connection
with such
substitution);
(C)
in connection with the Cash Liquidation or REO Disposition of a
Discount
Mortgage Loan that did not result in any Excess Special Hazard Losses,
Excess Fraud Losses,
Excess Bankruptcy Losses or Extraordinary Losses,
an amount equal to the lesser of (1) the applicable Discount
Fraction of
the Stated Principal
Balance of such Discount Mortgage Loan immediately
prior to such
Distribution Date and
(2) the aggregate
amount of the
collections on such
Discount Mortgage Loan to the extent applied as
recoveries of principal;
(D)
any amounts allocable
to principal for any previous Distribution Date
(calculated pursuant
to clauses
(A) through (C) above) that remain
undistributed; and
(E)
the amount of any Class A-P Collection Shortfalls for such
Distribution
Date and the amount of
any Class A-P
Collection Shortfalls
remaining
unpaid for all previous Distribution Dates, but only to the extent of
the Eligible Funds for such Distribution Date; minus
(F)
the related
Discount Fraction of the portion of the Capitalization
Reimbursement Amount for such Distribution Date, if any, related to
each
Discount Mortgage Loan; and
(ii)
the Senior Principal
Distribution Amount
shall be distributed
concurrently as follows:
(A)
first, to the Class R-I and Class R-II Certificates, pro rata,
in accordance
with their respective Certificate Principal
Balances, until the Certificate Principal Balances thereof have
been reduced to zero;
(B)
second, to the Class A-1 and Class A-2 Certificates, pro rata,
in accordance
with their respective Certificate Principal
Balances, an
amount up to the Lockout Amount for that
Distribution Date,
until the Certificate
Principal Balances
thereof have been reduced to zero;
(C)
third, the balance of the Senior Principal Distribution Amount
remaining after the distributions, if any, described in section
4.02(b)(iii)(B) above
will be distributed concurrently as
follows:
(1)
62.2796641953% of the amount described in Section
4.02(b)(iii)(C) shall
be distributed in the
following manner
and priority
i.
first, to
the Class A-3 and Class A-4 Certificates,
sequentially, in
that order, an amount up to the amount
necessary to cause the aggregate Certificate Principal Balance
thereof to equal their Aggregate Planned Principal Balance for
that Distribution
Date,
until the Certificate Principal
Balances thereof have been reduced to zero;
ii.
second, to the
Class A-5 Certificates, an amount up to the
amount necessary to
cause the Certificate
Principal Balance
thereof to
equal its Targeted Principal Balance for that
Distribution Date,
until the Certificate Principal Balance
thereof has been reduced to zero;
iii.
third, to the Class
A-6 Certificates,
until the Certificate
Principal Balance thereof has been reduced to zero;
iv.
fourth, to the Class
A-5 Certificates,
without regard to
the
Targeted Principal
Balance for that
Distribution Date,
until
the Certificate
Principal Balance
thereof has been reduced to
zero;
v.
fifth, to the Class
A-7 Certificates,
until the Certificate
Principal Balance thereof has been reduced to zero;
vi.
sixth, to
the Class A-3 and Class A-4 Certificates,
sequentially, in that
order, and without regard to their
Aggregate Planned Principal Balance for that Distribution Date,
until the Certificate
Principal Balances thereof have been
reduced to zero; and
vii.
seventh, to the Class A-11 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero; and
(2)
37.7203358047% of the amount described in Section
4.02(b)(iii)(C) shall
be distributed in the
following manner
and priority:
i.
first, an amount up to $1,070, to the Class A-8 Certificates,
until the Certificate Principal Balance thereof has been
reduced to zero;
ii.
second, an
amount up to $1,177,000, to the Class A-10
Certificates, until
the Certificate
Principal Balance thereof
has been reduced to zero;
iii.
third, to the Class
A-8 Certificates until the Certificate
Principal Balance thereof has been reduced to zero;
iv.
fourth, to the Class
A-10 Certificates
until the
Certificate
Principal Balance thereof has been reduced to zero; and
v.
fifth, to the Class
A-11 Certificates
until the Certificate
Principal Balance thereof has been reduced to zero; and
(D)
fourth, to the Class A-1 and Class A-2 Certificates, pro rata,
in accordance
with their respective Certificate Principal
Balances and
without regard to the Lockout Amount for that
Distribution Date,
until the Certificate
Principal Balances
thereof have been reduced to zero.
(c)
On or after the
occurrence of the
Credit Support Depletion
Date, all priorities
relating to distributions as described in
Section 4.02(b)
of this Series Supplement in respect of
principal among the Senior Certificates (other than the Class
A-P
Certificates) will be disregarded, and (i) an amount equal
to the Discount
Fraction of the principal portion of scheduled
payments and
unscheduled
collections received
or advanced in
respect of the
Discount Mortgage Loans minus the Discount
Fraction of the
portion of the
Capitalization
Reimbursement
Amount for such
Distribution Date will
be distributed to
the
Class A-P Certificates, (ii) the Senior Principal
Distribution
Amount will be distributed to the remaining Senior Certificates
(other than the Class A-P Certificates) pro rata in
accordance
with their
respective
outstanding
Certificate
Principal
Balances and (iii) the
amount set forth in Section 4.02(a)(i)
herein will be
distributed
as set forth therein provided,
however, that until
reduction of the Certificate Principal
Balances of the Class A-2 Certificates to zero, the aggregate
amount
distributable to
the Class A-1 and Class A-2
Certificates in
respect of the aggregate Accrued Certificate
Interest thereon
and in respect of
their aggregate
pro rata
portion of the Senior
Principal Distribution
Amount will be
distributed among those Certificates in the following priority:
first, to the Class A-1 Certificates, up to an amount equal to
the Accrued Certificate Interest on the Class A-1 Certificates;
second, to the Class A-2 Certificates, up to an amount equal to
the Super Senior
Optimal Principal
Distribution
Amount, in
reduction of the Certificate Principal Balance thereof,
until
the Certificate
Principal Balance
thereof has been reduced to
zero; third,
to the Class A-2
Certificates,
up to an amount
equal to the Accrued Certificate Interest thereon; and fourth,
to the Class A-2 Certificates, the remainder, until the
Certificate Principal Balance thereof has been reduced to zero.
(d)
After the reduction of the Certificate Principal Balances of
the Senior Certificates (other than the Class A-P Certificates)
to zero but prior to the Credit Support Depletion Date, the
Senior Certificates
(other than the Class A-P Certificates)
will be entitled
to no further distributions of principal
thereon and the
Available Distribution Amount will be paid
solely to the holders of the Class A-P Certificates, Class A-V
Certificates, Class M Certificates and Class B Certificates, in
each case as described herein.
(e)
In addition to the foregoing distributions, with respect to any
Subsequent Recoveries,
the Master Servicer
shall deposit such
funds into
the Custodial Account pursuant to Section
3.07(b)(iii). If,
after taking into
account such
Subsequent
Recoveries, the
amount of a
Realized Loss is reduced, the
amount of such Subsequent Recoveries will be applied to
increase the
Certificate
Principal Balance of the Class of
Subordinate
Certificates with the
Highest Priority to which
Realized Losses, other
than Excess Bankruptcy
Losses, Excess
Fraud Losses, Excess
Special Hazard Losses
and Extraordinary
Losses, have been allocated, but not by more than the amount of
Realized Losses
previously
allocated
to that Class of
Certificates pursuant
to Section 4.05. The amount of any
remaining Subsequent Recoveries will be applied to increase the
Certificate Principal Balance of the Class of Certificates with
the next Lower
Priority, up to the amount of such Realized
Losses previously
allocated to that Class of Certificates
pursuant to Section 4.05. Any remaining Subsequent Recoveries
will in turn be applied to increase the Certificate Principal
Balance of the
Class of Certificates with the next Lower
Priority up to the amount of such Realized Losses previously
allocated to that
Class of Certificates
pursuant to Section
4.05, and so on.
Holders of such Certificates will not be
entitled to any
payment in
respect of Accrued Certificate
Interest on the
amount of such increases for any Interest
Accrual Period
preceding the
Distribution Date on
which such
increase occurs.
Any such increases shall be applied to the
Certificate Principal Balance of each Certificate of such Class
in accordance with its respective Percentage Interest.
(f)
On each Distribution
Date, the Trustee will
first transfer to
the Certificate
Account and then
distribute to the
Class A-8
Certificates any
amounts on deposit in the Reserve Fund in an
amount up
to the Yield Supplement Amount for such Distribution
Date.
(g)
Each distribution
with respect to a Book-Entry Certificate
shall be paid to the
Depository, as Holder
thereof, and the
Depository shall be solely responsible for crediting the amount
of such distribution to the accounts of its Depository
Participants in
accordance with its
normal procedures.
Each
Depository
Participant shall be responsible for disbursing such
distribution to the
Certificate Owners
that it represents and
to each indirect
participating
brokerage firm (a "brokerage
firm" or "indirect
participating
firm") for which it
acts as
agent. Each brokerage
firm shall be responsible for disbursing
funds to the Certificate Owners that it represents. None of the
Trustee, the Certificate Registrar, the Company or the Master
Servicer shall
have any responsibility therefor except as
otherwise provided by this Series Supplement or applicable law.
(h)
Except as otherwise
provided in Section
9.01, if the Master
Servicer anticipates
that a final distribution with respect to
any Class of Certificates will be made on a future Distribution
Date, the Master Servicer shall, no later than 40 days prior to
such final
distribution, notify
the Trustee
and the Trustee
shall, not
earlier than the 15th day and not later
than the
25th day of the month
next preceding
the month of such
final
distribution,
distribute, or cause
to be distributed to
each
Holder of such Class
of Certificates
a notice to the
effect
that: (i) the Trustee
anticipates that the final distribution
with respect to such Class of Certificates will be made on such
Distribution Date but
only upon presentation
and surrender of
such Certificates at
the office of the Trustee or as otherwise
specified therein,
and (ii) no interest
shall accrue on
such
Certificates from and
after the end of the
related Interest
Accrual Period. In the event that Certificateholders required
to surrender their Certificates pursuant to Section 9.01(c) do
not surrender their
Certificates for final
cancellation, the
Trustee shall cause
funds distributable
with respect to
such
Certificates to be withdrawn from the Certificate Account and
credited to a separate
escrow account for the
benefit of such
Certificateholders as provided in Section 9.01(d).
(i)
On each Distribution
Date preceding the Accretion Termination
Date for any Class of Accrual Certificates, an amount equal to
the Accrued
Certificate
Interest that would otherwise be
distributed to such Class of Accrual Certificates will be added
to the Certificate
Principal Balance thereof and will be
distributed to the
holders of the related
Class of Accretion
Directed Certificates and such Class of Accrual Certificates as
distributions of principal pursuant
to
Section
4.02(a)(ii)(Y)(1) in
reduction of the
Certificate
Principal
Balances thereof.
The amount that is
added to the Certificate
Principal Balance
of any of the Accrual Certificates will
accrue interest
at a rate of 6.25% per annum. On each
Distribution Date on
or after the Accretion
Termination Date
for any Class of
Accrual Certificates, the entire Accrued
Certificate Interest
on such Class of Accrual Certificates for
such date will be
payable to the holders of such Class of
Accrual Certificates, as interest.
Section 4.03 Statements to Certificateholders; Statements to Rating Agencies;
Exchange Act
Reporting. (See
Section 4.03 of the
Standard Terms)
and
Exhibit Three hereto)
Section 4.04 Distribution of Reports to the Trustee and the
Company; Advances by
the Master Servicer. (See Section 4.04 of the Standard Terms)
Section 4.05
Allocation of Realized Losses.
Prior to each Distribution Date, the Master Servicer shall
determine the
total amount
of Realized Losses, if any, that resulted from any Cash
Liquidation, Servicing Modification, Debt Service Reduction,
Deficient Valuation
or REO Disposition that occurred during the related Prepayment
Period or, in the
case of a Servicing
Modification that
constitutes a
reduction of the interest
rate on a Mortgage Loan, the amount of the reduction in the
interest portion
of
the Monthly
Payment due during the related Due Period. The amount of each
Realized Loss shall be
evidenced by an Officers' Certificate. All Realized
Losses, other than Excess Special Hazard Losses, Extraordinary Losses, Excess
Bankruptcy Losses or Excess Fraud Losses, shall be allocated as
follows: first,
to the Class B-3 Certificates until the Certificate Principal Balance thereof
has been reduced
to zero; second, to the Class B-2 Certificates until the
Certificate Principal
Balance thereof has
been reduced to zero;
third, to the
Class B-1 Certificates until the Certificate Principal Balance thereof has
been
reduced to zero;
fourth, to the Class
M-3 Certificates
until the
Certificate
Principal Balance
thereof has been
reduced to zero;
fifth, to the Class M-2
Certificates until the Certificate Principal Balance thereof has
been reduced to
zero; sixth,
to the Class M-1
Certificates
until the Certificate Principal
Balance thereof has been reduced to zero; and, thereafter,
if any such
Realized
Losses are on a Discount Mortgage Loan, to the Class A-P Certificates in an
amount equal to the Discount Fraction of the principal portion
thereof, and the
remainder of such Realized Losses on the Discount Mortgage Loans and the entire
amount of such Realized Losses on Non-Discount Mortgage Loans will be
allocated
among all the Senior
Certificates (other
than the Class A-V
Certificates and
Class A-P
Certificates) in the case of the principal portion of such loss on a
pro rata basis and among all of the Senior Certificates (other than the Class
A-P Certificates) in the case of the interest portion of such loss
on a pro rata
basis, as described below; provided, however, that such losses otherwise
allocable to the
Class A-1 Certificates will be allocated to the Class A-2
Certificates, as long as the Class A-2 Certificates remain
outstanding.
On any Distribution
Date, Realized Losses will be allocated as set forth
herein after distributions of principal on the Certificates as set
forth herein.
As used herein, an
allocation of a
Realized Loss on a "pro rata basis"
among two or more specified Classes of Certificates means an
allocation on a pro
rata basis,
among the various Classes so specified, to each such Class of
Certificates on the
basis of their then outstanding Certificate Principal
Balances prior to giving effect to distributions to be made on such
Distribution
Date in the case of the principal portion of a Realized Loss or based on the
Accrued Certificate
Interest thereon payable on such Distribution Date (without
regard to any Compensating Interest for such Distribution
Date) in the case
of
an interest
portion of a Realized
Loss; provided that for the purposes of
determining "pro rata", the Certificate Principal Balance of each class of the
Accrual Certificates
shall be deemed to be the lesser of (a) the related
Certificate Principal
Balance thereof as of the Closing Date or (b) the related
Certificate Principal
Balance thereof as of such date of determination. Except
as provided in the following sentence, any allocation of the principal
portion
of Realized
Losses (other than Debt Service Reductions) to a Class of
Certificates shall be made by reducing the Certificate Principal
Balance thereof
by the amount so allocated, which allocation shall be deemed to
have occurred on
such Distribution
Date; provided that no such reduction shall reduce the
aggregate Certificate
Principal Balance of the Certificates below the aggregate
Stated Principal
Balance of the Mortgage Loans. Any allocation of the principal
portion of
Realized Losses
