EXECUTION COPY
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RESIDENTIAL ACCREDIT LOANS, INC.,
Company,
RESIDENTIAL FUNDING CORPORATION,
Master Servicer,
and
DEUTSCHE BANK TRUST COMPANY AMERICAS,
Trustee
SERIES SUPPLEMENT,
DATED AS OF MARCH 1, 2005,
TO
STANDARD TERMS OF
POOLING AND SERVICING AGREEMENT
dated as of August 1, 2004
Mortgage Asset-Backed Pass-Through Certificates
Series 2005-QS3
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<PAGE>
<TABLE>
<S>
<C>
Article I
DEFINITIONS....................................................................4
Section 1.01.
Definitions..........................................................4
Section 1.02. Use of
Words and Phrases............................................31
Section 1.03.
Determination of
LIBOR..............................................32
Article II
CONVEYANCE OF MORTGAGE LOANS; ORIGINAL
ISSUANCE OF
CERTIFICATES...........................................................34
Section 2.01.
Conveyance of Mortgage
Loans.......................................34
Section 2.02.
Acceptance by Trustee.
(See Section 2.02 of the Standard
Terms)...............................................................35
Section 2.03.
Representations, Warranties and Covenants of the
Master Servicer and the
Company......................................35
Section 2.04. Representations and Warranties of
Sellers............................39
Section 2.05. Execution and Authentication of Certificates/Issuance
of
Certificates Evidencing Interests in REMIC I and REMIC
II............39
Section 2.06. Conveyance of Uncertificated REMIC I Regular
Interests and
REMIC II Regular Interests; Acceptance by the
Trustee................39
Section 2.07. Issuance of Certificates Evidencing Interests in
REMIC III...........39
Section 2.08. Purposes and Powers of the Trust (See Section 2.08 of
the
Standard
Terms)......................................................39
Article III ADMINISTRATION AND SERVICING OF
MORTGAGE LOANS................................40
Article IV PAYMENTS TO
CERTIFICATEHOLDERS.................................................41
Section 4.01. Certificate Account. (See Section 4.01 of the Standard
Terms) .....41
Section 4.02. Distributions.
......................................................41
Section 4.03. Statements to Certificateholders; Statements to the
Rating
Agencies; Exchange Act Reporting (See Section 4.03 of the
Standard
Terms)......................................................52
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)......................................................52
Section 4.05. Allocation of Realized Losses.
......................................52
Section 4.06. Reports of Foreclosures and Abandonment of Mortgaged
Property.
(See Section 4.06 of the Standard
Terms).............................54
Section 4.07. Optional Purchase of Defaulted Mortgage Loans.
(See Section
4.07 of the Standard
Terms)..........................................54
Section 4.08. Surety Bond. (See Section 4.08 of the Standard
Terms)................54
Section 4.09. Reserve
Fund.........................................................54
i
<PAGE>
Article V THE
CERTIFICATES................................................................56
Article VI THE COMPANY AND THE
MASTER SERVICER..........................................57
Article VII
DEFAULT......................................................................58
Article VIII CONCERNING THE
TRUSTEE.......................................................59
Article IX
TERMINATION..................................................................60
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................................................60
Section 9.02. Additional Termination
Requirements..................................60
Section 9.03. Termination of Multiple
REMICs.......................................60
Article X REMIC
PROVISIONS............................................................61
Section 10.01.REMIC Administration. (See Section 10.01 of the Standard
Terms).....61
Section 10.02.Master Servicer; REMIC Administrator and Trustee
Indemnification. (See
Section 10.02 of the Standard Terms)..........61
Section 10.03.Designation of
REMICs................................................61
Section 10.04.Distributions on the Uncertificated REMIC I and REMIC
II
Regular
Interests....................................................61
Section 10.05.Compliance with Withholding
Requirements.............................61
Article XI MISCELLANEOUS
PROVISIONS......................................................65
Section 11.01.Amendment. (See Section 11.01 of the Standard
Terms)................65
Section 11.02.Recordation of Agreement; Counterparts. (See Section 11.02 of
the Standard
Terms)..................................................65
Section 11.03.Limitation on Rights of Certificateholders.
(See Section 11.03
of the Standard
Terms)...............................................65
Section 11.04.Governing Laws. (See Section 11.04 of the Standard
Terms)...........65
Section
11.05.Notices..............................................................65
Section 11.06.Required Notices to Rating Agency and Subservicer.
(See
Section 11.06 of the Standard
Terms).................................66
Section 11.07.Severability of Provisions. (See Section 11.07 of the
Standard
Terms)...............................................................66
ii
<PAGE>
Section 11.08.Supplemental Provisions for Resecuritization.
(See Section
11.08 of the Standard
Terms).........................................66
Section 11.09.Allocation of Voting
Rights..........................................66
Section 11.10.No
Petition..........................................................66
</TABLE>
iii
<PAGE>
EXHIBITS
Exhibit One-I:
Mortgage Loan Schedule (Sub-Group I-1 Loans)
Exhibit One-II:
Mortgage Loan Schedule (Sub-Group I-2 Loans)
Exhibit One-III: Mortgage
Loan Schedule (Group II Loans)
Exhibit Two-I:
Schedule of Discount Fractions for Sub-Group I-1 Loans
Exhibit Two-II:
Schedule of Discount Fractions for Group II Loans
Exhibit Three:
Information to be Included in
Monthly Distribution Date Statement
Exhibit Four:
Standard Terms of Pooling and Servicing
Agreement Dated as of August 1, 2004
iv
<PAGE>
This is a Series
Supplement, dated as
of March 1, 2005
(the "Series
Supplement"), to the Standard Terms of
Pooling and Servicing Agreement, dated as
of August 1, 2004 and attached as Exhibit
Four hereto (the "Standard Terms" and,
together with this Series Supplement,
the "Pooling and
Servicing Agreement"
or
"Agreement"), among RESIDENTIAL ACCREDIT LOANS, INC., as the
company (together
with its permitted successors and assigns,
the "Company"),
RESIDENTIAL
FUNDING
CORPORATION, as master servicer (together with its permitted successors and
assigns, the "Master Servicer"),
and DEUTSCHE BANK
TRUST COMPANY AMERICAS, as
Trustee (together with its permitted
successors and assigns, the "Trustee").
PRELIMINARY STATEMENT:
The Company
intends
to sell mortgage asset-backed pass-through
certificates (collectively, the "Certificates"), to be issued hereunder in
multiple classes, which in the aggregate
will evidence the
entire beneficial
ownership interest in the Mortgage Loans
(as defined herein. 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), as three real estate mortgage
investment conduits (each, a "REMIC") for
federal income tax purposes.
The terms and provisions of the Standard Terms are hereby incorporated
by reference herein as though set forth in
full herein. If any term or provision
contained herein shall conflict with or be inconsistent with any provision
contained in the Standard Terms, the terms and provisions of this Series
Supplement shall govern. All capitalized terms not otherwise defined herein
shall have the meanings set forth in the Standard Terms. The Pooling and
Servicing Agreement shall be dated as of
the date of this Series Supplement.
1
<PAGE>
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
Fitch/
Pass-Through
Certificate
Maturity
----------------- Minimum
Designation
Rate
Principal Balance Features1
Date
Moody's/S&P
Denominations2
<S>
<C>
<C>
<C>
<C> <C>
<C>
Class I-A1-1
5.50%
$88,912,100.00
Senior/Fixed Rate
March 25, 2035 AAA/Aaa/NA
$25,000.00
Class I-A1-2
5.50%
$10,000,000.00 Senior/Fixed Rate
March 25, 2035 AAA/Aaa/NA
$25,000.00
Class I-A1-3
5.50%
$10,990,200.00 Senior/Lockout/Fixed
Rate March 25, 2035 AAA/Aaa/NA
$25,000.00
Senior/Super
Adjustable3 $167,418,000.00
Senior/Floater/Adjustable
Class I-A2-1
Rate
Rate
March 25, 2035
AAA/Aaa/AAA $25,000.00
Senior/Interest
Adjustable3
Only/Inverse
Class I-A2-2
Rate
$0.00(4) Floater/Adjustable Rate March 25, 2035
AAA/Aaa/NA
$2,000,000.00
$24,048,000.00
Class I-A2-3
5.50%
Senior/Lockout/Fixed Rate March 25, 2035 AAA/Aaa/NA
$25,000.00
Senior/Super
Class I-A2-4
5.50%
$41,338,100.00 Senior/Lockout/Fixed
Rate March 25,
2035 AAA/Aaa/NA
$25,000.00
Senior/Senior Support/
Class I-A2-5
5.50%
$1,947,900.00
Lockout/Fixed Rate March 25, 2035
AAA/Aa1/NA
$25,000.00
Adjustable
$5,725,700.00 Senior/Senior Support/
Class I-A2-6
Rate3
Floater/Adjustable Rate March 25, 2035
AAA/Aa1/NA
$25,000.00
March 25, 2020
Class II-A-1
5.00%
$100,604,000.00 Senior/Fixed Rate
March 25, 2020 AAA/Aaa/NA
$25,000.00
Class I-A-P
0.00%
$781,468.00 Senior/Principal Only
AAA/Aaa/NA $25,000.00
March 25, 2035
Class I-A-V
Variable
$0.00
Senior/Interest
AAA/Aaa/NA
$2,000,000.00
Rate1
Only/Variable Rate
March 25, 2035
Class II-A-P
0.00%
$205,934.00 Senior/Principal Only
March 25, 2020 AAA/Aaa/NA
$25,000.00
Class II-A-V Variable
$0.00
Senior/Interest
March 25, 2020 AAA/Aaa/NA
$2,000,000.00
Rate2
Only/Variable Rate
Class R-I
5.50%
$100.00
Senior/Residual/Fixed Rate March 25, 2035 AAA/Aaa/NA
(3)
Class R-II
5.00%
$100.00
Senior/Residual/Fixed Rate March 25, 2020 AAA/Aaa/NA
(7)
Class R-III
5.50%
$100.00
Senior/Residual/Fixed Rate March 25, 2035 AAA/Aaa/NA
(7)
Class I-M-1
5.50%
$10,590,600.00 Mezzanine/Fixed Rate
March 25, 2035
AA/NA/NA
$25,000.00
Class I-M-2
5.50%
$3,344,400.00 Mezzanine/Fixed Rate
March 25, 2035
A/NA/NA
$250,000.00
Class I-M-3
5.50%
$1,858,000.00 Mezzanine/Fixed Rate
March 25, 2035
BBB/NA/NA $250,000.00
Class II-M-1
5.00%
$2,235,600.00 Mezzanine/Fixed Rate
March 25, 2020
AA/NA/NA
$25,000.00
Class II-M-2
5.00%
$208,000.00 Mezzanine/Fixed Rate
March 25, 2020
A/NA/NA
$250,000.00
Class II-M-3
5.00%
$312,000.00 Mezzanine/Fixed Rate
March 25, 2020
BBB/NA/NA $250,000.00
Class I-B-1
5.50%
$1,858,000.00 Subordinate/Fixed Rate
March 25,
2035
BB/NA/NA
$250,000.00
Class I-B-2
5.50%
$1,114,800.00 Subordinate/Fixed Rate
March 25,
2035
B/NA/NA
$250,000.00
Class I-B-3
5.50%
$1,672,286.00 Subordinate/Fixed Rate
March 25,
2035
NA/NA/NA
$250,000.00
Class II-B-1
5.00%
$156,000.00 Subordinate/Fixed Rate
March 25,
2020
BB/NA/NA (2)
Class II-B-2
5.00%
$104,000.00
Subordinate/Fixed Rate March 25,
2020
B/NA/NA (2)
Class II-B-3
5.00%
$156,040.00 Subordinate/Fixed Rate
March 25,
2020
NA/NA/NA (2)
</TABLE>
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1 The Certificates,
other than the Class B and Class R Certificates, shall be
Book-Entry
Certificates.
The Class B and 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 I-A-P, Class II-A-P, Class I-B-1, Class
I-B-2, Class I-B-3, Class II-B-1, Class II-B-2 and Class II-B-3
Certificates) in
excess thereof, except
that one Certificate of any of the
Class I-A-P,
Class II-A-P,
Class I-B-1,
Class I-B-2,
Class I-B-3, Class
II-B-1,
Class II-B-2 and Class
II-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 (or in the case of
the
Class
II-B-1, Class II-B-2 and Class II-B-3 Certificates in minimum
original
denominations equal to
the initial Certificate Principal Balance
of such
Certificate) and such
uneven multiple for such Class or the sum of
such
denomination and an integral multiple of $1,000.
3
-------------------------- --------
--------------- --------------------- ------
Adjustable Rates:
Initial Formula
Maximum
Minimum
Class I-A2-1 Certificates 3.35% LIBOR + 0.50%
Subject to the
0.50%
Available Funds Cap
Class I-A2-2 Certificates 2.15% 5.00% - LIBOR
5.00%
0.00%
Class I-A2-6 Certificates 3.35% LIBOR + 0.50%
Subject to the
0.50%
Available Funds Cap
The Class I-A2-1 and Class I-A2-6
Certificates will
represent ownership of
the
REMIC II together with certain rights to payments to be made from amounts
received under the Yield Maintenance Agreement which will be deemed made for
federal income tax purposes outside of
REMIC II by the Underwriter, as the owner
of the Yield Maintenance Agreement.
4 The Class I-A2-2 Certificates do not have a principal
balance. For the
purpose of
calculating
interest payments, interest on the Class I-A2-2
Certificates
will
accrue on a notional amount equal to aggregate
Certificate
Principal Balance of the Class I-A2-1 and Class I-A2-6
Certificates
immediately prior to the related Distribution Date.
2
<PAGE>
5 The
initial Pass-Through Rate on the Class I-A-V Certificates is
0.4059%.
6 The
initial Pass-Through Rate on the Class II-A-V Certificates is
0.4051%.
7 Each
class of 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 of each Class 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%.
The Group I Loans have an aggregate principal balance as of the
Cut-off
Date of $371,599,754. The Group II Loans have an
aggregate principal balance as
of the Cut-off Date of $103,981,675.
In consideration of the mutual agreements herein contained, the
Company,
the Master Servicer and the Trustee agree
as follows:
3
<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.
Accrued Certificate Interest: With respect to each Distribution
Date, as
to any Class or Subclass of Certificates (other than any Principal Only
Certificates), interest accrued during the related
Interest Accrual
Period at
the related Pass-Through Rate on the
Certificate Principal
Balance or Notional
Amount thereof immediately prior to such
Distribution Date. Accrued Certificate
Interest will be calculated on the basis of
a 360-day year, consisting of twelve
30-day months. In each case Accrued Certificate Interest on any Class or
Subclass of Certificates will be reduced by
the amount of:
(i)
Prepayment Interest
Shortfalls
on all Mortgage Loans in the
related Loan
Group (to the
extent not offset by the Master
Servicer with a payment of Compensating Interest as provided in
Section 4.01),
(ii) the interest
portion (adjusted to the Net Mortgage Rate
(or the
Modified Net
Mortgage Rate in the case of a Modified
Mortgage
Loan)) of Realized
Losses on all Mortgage
Loans in the
related
Loan Group (including Excess Special Hazard Losses, Excess Fraud
Losses, Excess
Bankruptcy Losses and
Extraordinary Losses)
not
allocated solely to
one or more specific Classes of Certificates
pursuant to Section 4.05,
(iii) the interest
portion of Advances that were (A) previously made
with respect to a
Mortgage Loan or REO
Property on the Mortgage
Loans in the related
Loan Group,
which remained unreimbursed
following the
Cash Liquidation or REO Disposition of such
Mortgage Loan or REO
Property and (B) made with respect to
delinquencies that
were ultimately determined to be Excess
Special Hazard Losses,
Excess Fraud Losses,
Excess Bankruptcy
Losses or Extraordinary Losses on the Mortgage Loans in the
related Loan Group and were not allocated solely to one or more
specific Classes of Certificates pursuant to Section 4.05, and
(iv) any other interest shortfalls not covered by the subordination
provided by the related Class M Certificates and related Class B
Certificates, including interest that is not collectible from
the
Mortgagor pursuant to
the Servicemembers
Civil Relief Act, as
amended, or similar
legislation or regulations as in effect from
time to time, all allocated as described below.
The Class I-A1 Percentage of these
reductions with
respect to the Sub-Group I-1
Loans, will be allocated among the Holders of the Class
I-A-V, Sub-Group
I-1
Senior, Class R-I and Class R-III
Certificates, in
proportion to the amounts of
Accrued Certificate Interest that would have been
payable to those Certificates
from the Sub-Group I-1 Loans on that
Distribution
Date absent such
reductions.
The Class I-A2 Percentage of these
reductions with
respect to the Sub-Group I-2
Loans will be allocated among the Holders of the Class
I-A-V Certificates
and
Sub-Group I-2 Senior Certificates, in proportion to the amounts of Accrued
Certificate Interest that would have been
payable to those Certificates from the
Sub-Group I-2 Loans on that Distribution
Date absent such reductions. The Class
4
<PAGE>
II-A Percentage of these reductions with respect to the
Group II Loans will be
allocated among the Holders of the Group II
Senior Certificates,
other than the
Class II-A-P Certificates, in proportion to the amounts of
Accrued Certificate
Interest that would have been payable to
those Certificates
from the Group II
Loans on that Distribution Date absent such reductions. The remainder of all
such reductions will be allocated among the Holders of the
related Class M
Certificates and related Class B Certificates
in proportion to their respective
amounts of Accrued Certificate Interest
payable on such Distribution Date absent
such reductions. In addition to that portion of the
reductions described in the
preceding sentence that are allocated to any
Class of Class B
Certificates or
any Class of Class M Certificates, Accrued
Certificate Interest on such Class of
Class B Certificates or such Class of Class M
Certificates
will be reduced by
the interest portion (adjusted to the Net
Mortgage Rate) of Realized Losses that
are allocated solely to such Class of Class B Certificates or such Class of
Class M Certificates pursuant to Section
4.05.
Adjustable Rate Certificates: Any of the Class I-A2-1, the Class
I-A2-2
and the Class I-A2-6 Certificates.
Aggregate Available
Distribution Amount: With respect to a Distribution
Date, the sum of the Available Distribution
Amounts for both Sub-Loan Groups for
such Distribution Date.
Aggregate Senior
Interest Distribution Amount: With respect to a
Distribution Date, the sum of the Senior
Interest Distribution
Amounts for both
Sub-Loan Groups for such Distribution
Date.
Aggregate Senior
Principal Distribution Amount: With respect to a
Distribution Date, the sum of the Senior
Principal Distribution Amounts for both
Sub-Loan Groups for such Distribution
Date.
Available Distribution Amount: As to any Distribution Date and each
Loan
Group or Sub-Loan Group, as applicable, an amount equal to (a) the sum of
(i)
the amount relating to the Mortgage Loans
on deposit in the Custodial Account as
of the close of business on the immediately preceding Determination Date,
including any Subsequent Recoveries, and amounts deposited in the Custodial
Account in connection with the substitution of Qualified
Substitute
Mortgage
Loans, (ii) the amount of any Advance made on the immediately preceding
Certificate Account Deposit Date, (iii) any
amount deposited in the Certificate
Account on the related Certificate Account Deposit Date pursuant to
the second
paragraph of Section 3.12(a), (iv) any amount deposited in the Certificate
Account pursuant to Section 4.07, (v) any
amount that the Master Servicer is not
permitted to withdraw from the Custodial Account or the Certificate Account
pursuant to Section 3.16(e), (vi) any
amount received by the Trustee pursuant to
the Surety Bond in respect of such
Distribution
Date and (vii) the
proceeds of
any Pledged Assets received by the Master
Servicer and any additional amounts to
5
<PAGE>
be included with respect to such Sub-Loan
Group, as applicable, pursuant to
Section 4.02(j), reduced by (b) the sum as of the
close of business on the
immediately preceding Determination Date of (w)
aggregate Foreclosure Profits,
(x) the Amount Held for Future Distribution, and (y) amounts permitted to be
withdrawn by the Master Servicer from the Custodial Account in respect of the
Mortgage Loans in the related Loan Group or Sub-Loan Group, as applicable,
pursuant to clauses (ii)-(x), inclusive, of
Section 3.10(a).
Available Funds Cap:
With respect to any Distribution Date on or before the
Distribution Date in July 2010 and the Class
I-A2-1 Certificates
or the Class
I-A2-6 Certificates, as applicable, 5.50% per annum,
plus amounts, if any, paid
pursuant to the Yield Maintenance Agreement and allocated to that Class of
Certificates, expressed as a per annum rate.
With respect to any
Distribution
Date after July 2010 and the Class
I-A2-1 Certificates or the Class I-A2-6
Certificates, 5.50% per annum.
Bankruptcy Amount:
With respect to each Loan Group 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) $156,694,
in the case of Loan
Group I, and
$150,000, in the case of Loan Group II, over (B) the aggregate amount of
Bankruptcy Losses allocated solely to one or more specific Classes of
Certificates in the related Certificate
Group 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 related 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) (i) if the aggregate principal balance of the
Non-Primary Residence
Loans in the related
Loan Group as of the
Relevant Anniversary
is less than 10% of
the Stated
Principal
Balance of the Mortgage Loans in the related Loan Group as of
the
Relevant Anniversary,
$0.00, or (ii) if the
aggregate principal
balance of the
Non-Primary Residence
Loans in the related
Loan
Group as of the Relevant Anniversary is equal to or greater
than
10% of the Stated Principal Balance of the Mortgage Loans in
the
related Loan Group as of the Relevant Anniversary, the sum of
(I)
the aggregate
principal balance of the Non-Primary Residence
Loans in the related
Loan Group with a
Loan-to-Value
Ratio of
greater than 80.00% but less than or equal to 90.00% (other than
Additional Collateral
Loans), times 0.25%, (II) the aggregate
principal
balance of the Non-Primary Residence Loans in the
related Loan Group
with a Loan-to-Value
Ratio of greater
than
90.00% but less than or equal to 95.00% (other than Additional
Collateral Loans), times 0.50%, and (III) the aggregate
principal
balance of the
Non-Primary Residence
Loans in the related
Loan
Group with a
Loan-to-Value Ratio of
greater than 95.00%
(other
than Additional Collateral Loans) times 0.75%, in each case as
of
the Relevant Anniversary; 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 related Loan
Group
(other than Additional
Collateral
Loans) 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 in the
related Loan Group as
of the Relevant
Anniversary)
of the Net
6
<PAGE>
Mortgage Rates of all Mortgage Loans in the related Loan Group
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
related Loan Group as
of the Relevant
Anniversary, and (z)
one
plus the quotient
of the number of all Non-Primary Residence
Loans remaining in the
related Loan Group
divided by the
total
number of Outstanding Mortgage Loans in the related Loan Group
as
of the Relevant Anniversary, and (ii) $50,000,
over (2) the aggregate
amount of Bankruptcy
Losses on Mortgage
Loans in the related Loan Group allocated solely to one or more
specific
Classes of related
Certificates in
accordance with
Section 4.05 since
the Relevant Anniversary.
The Bankruptcy Amount
for each Loan Group 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 related
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.
Capitalization
Reimbursement Amount:
As to any Distribution
Date and
Loan Group or Sub-Loan Group, as
applicable, the amount of Advances or Servicing
Advances that were added to the Stated
Principal Balance of the Mortgage Loans
in such Loan Group or Sub-Loan Group,
as applicable,
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 related
Capitalization Reimbursement Shortfall Amount remaining
unreimbursed from
any
prior Distribution Date and reimbursed
to the Master Servicer or Subservicer on
or prior to such Distribution Date.
Capitalization
Reimbursement
Shortfall Amount: As
to any Distribution
Date and Loan Group, or Sub-Loan Group,
as applicable,
the amount,
if any, by
which the amount of Advances or Servicing
Advances that were added to the Stated
Principal Balance of the Mortgage Loans in
such Loan Group or Sub-Loan Group, as
applicable, during the preceding calendar
month exceeds the amount of principal
payments on the Mortgage Loans included in
the Available Distribution Amount for
that Loan Group or Sub-Loan Group and
Distribution Date.
Certificate: Any Class I-A1-1, Class I-A1-2, Class I-A1-3, Class
I-A2-1,
Class I-A2-2, Class I-A2-3, Class I-A2-4, Class I-A2-5, Class I-A2-6, Class
I-A-V, Class I-A-P, Class II-A-1,
Class II-A-V,
Class II-A-P, Class
R-I, Class
R-II, Class R-III, Class I-M-1,
Class I-M-2,
Class I-M-3, Class
II-M-1, Class
II-M-2, Class II-M-3, Class I-B-1, Class
I-B-2, Class I-B-3, Class II-B-1, Class
II-B-2 and Class II-B-3 Certificates.
7
<PAGE>
Certificate Account:
The separate account or accounts created and
maintained pursuant to Section 4.01 of the Standard Terms, which shall be
entitled "Deutsche Bank Trust Company
Americas, as trustee, in trust for the
registered holders of Residential
Accredit Loans, Inc.,
Mortgage Asset-Backed
Pass-Through Certificates, Series 2005-QS3" and which must be an Eligible
Account.
Certificate Group: With respect to (i) Loan Group I, the Group I
Senior,
Class I-M, Class I-B-1, Class I-B-2 and
Class I-B-3 Certificates; and (ii) Loan
Group II, the Group II Senior, Class II-M, Class II-B-1, Class
II-B-2 and Class
II-B-3 Certificates.
Certificate Policy:
None.
Certificate Principal
Balance: With respect
to each Certificate (other
than any Interest Only Certificate), on any date of determination, an amount
equal to:
(i) the Initial
Certificate Principal
Balance of such Certificate as
specified on the face thereof, plus
(ii) any Subsequent Recoveries added to the Certificate Principal
Balance of such Certificate pursuant to Section 4.02, minus
(iii) the sum of (x) the aggregate of all amounts previously
distributed with
respect to such Certificate (or any predecessor
Certificate) and
applied to reduce the Certificate Principal
Balance thereof pursuant to Section 4.02(a) and (y) the
aggregate
of all reductions in Certificate Principal Balance deemed to
have
occurred in connection with Realized Losses which were
previously
allocated to such
Certificate (or any
predecessor
Certificate)
pursuant to Section 4.05;
provided, that the Certificate Principal Balance of each Certificate of the
Class of Subordinate Certificates with the Lowest Priority at any given time
shall be further reduced by an amount equal to the Percentage Interest
represented by such Certificate multiplied by the excess,
if any, of (A) the
then aggregate Certificate Principal Balance of all Classes
of Certificates in
the related Certificate Group then outstanding over (B) the then aggregate
Stated Principal Balance of the Mortgage
Loans in the related Loan Group.
Certificate Sub-Group:
With respect to (i) Sub-Loan Group I-1, the
Sub-Group I-1 Senior, Class R-I and Class
R-III Certificates;
and (ii) Sub-Loan
Group I-2, the Sub-Group I-2 Senior
Certificates.
Class A-P Collection Shortfall: With respect to the Cash
Liquidation or
REO Disposition of a Discount Mortgage Loan, any Distribution
Date and any Loan
Group, the extent to which the amount described in clause (C)(1) of the
definition of Class A-P Principal Distribution Amount for such Loan Group or
Sub-Loan Group, as applicable, is less than the amount
described in clause
(C)(2) of such definition.
Class A-P Principal Distribution Amount: With respect to any
Distribution Date and Loan Group or Sub-Loan
Group, as applicable, an amount
equal to the aggregate of:
8
<PAGE>
(A) the related
Discount Fraction of
the principal
portion of
each Monthly Payment on each Discount Mortgage Loan in the related
Loan
Group or Sub-Loan
Group due during the
related Due Period,
whether or
not received on or prior to the related Determination Date, minus the
Discount Fraction of
the principal portion
of any related Debt Service
Reduction which
together with other Bankruptcy Losses exceeds the
Bankruptcy Amount;
(B) the related Discount Fraction of the principal portion of
all
unscheduled
collections on each
Discount Mortgage Loan
in the related
Loan Group or Sub-Loan
Group received
during the
preceding calendar
month or, in the case
of Principal
Prepayments
in Full, during the
related Prepayment
Period (other than amounts received in connection
with a Cash
Liquidation or REO Disposition of a Discount Mortgage Loan
described in clause (C) below), including Principal Prepayments in
Full,
Curtailments,
Subsequent Recoveries
and repurchases
(including deemed
repurchases under
Section 3.07(b)) of Discount Mortgage Loan in the
related Loan Group or Sub-Loan Group (or, in the case of a
substitution
of a Deleted Mortgage
Loan in the related Loan Group or Sub-Loan Group,
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 in the related
Loan Group or Sub-Loan
Group
that occurred during the preceding calendar month (or was deemed to
have
occurred during such period in accordance with Section 3.07(b))
that did
not result in any Excess Special Hazard Losses, Excess Fraud Losses,
Excess Bankruptcy Losses or Extraordinary Losses, an amount equal
to the
lesser of (1) the applicable Discount Fraction of the Stated
Principal
Balance of
such Discount Mortgage Loan immediately prior to such
Distribution Date and
(2) the aggregate
amount of the
collections on
such Mortgage Loan to the extent applied as recoveries of
principal;
(D) any amounts allocable to principal for any previous
Distribution Date (calculated pursuant to clauses (A) through (C)
above)
that remain undistributed; and
(E) the amount of any Class A-P Collection Shortfalls for such
Distribution Date
and Loan Group and the amount of any Class A-P
Collection Shortfalls
for such Loan
Group remaining unpaid for all
previous Distribution
Dates, but only to the extent of the Eligible
Funds for such Distribution Date; minus
(F) the related Discount Fraction of the portion of the
Capitalization
Reimbursement Amount
for the related Loan Group or
Sub-Loan Group for
such Distribution
Date, if any, related to each
Discount Mortgage Loan in the related Loan Group or Sub-Loan
Group.
Notwithstanding the foregoing, with respect to any Distribution
Date on
and after the Credit Support Depletion Date, the Class A-P Principal
Distribution Amount for a Loan Group or
Sub-Loan Group shall equal the excess of
(i) the sum of (a) the related Discount Fraction of the principal portion of
each Monthly Payment on each Discount
Mortgage Loan in the related Loan Group or
Sub-Loan Group received or advanced prior
to the related
Determination Date and
not previously distributed minus the Discount
Fraction of the principal portion
of any related Debt Service Reduction which together with other Bankruptcy
Losses exceeds the Bankruptcy Amount and (b) the aggregate
amount calculated
pursuant to clauses (B) and (C) above over
(ii) the amount
calculated
pursuant
to clause (F) above.
9
<PAGE>
Class A-P
Certificates: The
Class I-A-P
Certificates and Class II-A-P
Certificates, which relate to and are payable from the
Group I Loans and Group
II Loans, respectively.
Class A-V
Certificates: The
Class I-A-V
Certificates and Class II-A-V
Certificates, which relate to and are payable from the
Group I Loans and Group
II Loans, respectively.
Class B Certificates:
The Class I-B-1, Class
I-B-2, Class I-B-3, Class
II-B-1, Class II-B-2 and Class II-B-3
Certificates. The Class I-B-1, Class I-B-2
and Class I-B-3 Certificates relate to and are payable from the
Group I Loans.
The Class II-B-1, Class II-B-2 and Class II-B-3
Certificates relate to
and are
payable from the Group II Loans.
Class M Certificates: The Class I-M-1, Class I-M-2, Class I-M-3
Certificates, which relate to and are payable
from the Group I
Loans, and the
Class II-M-1, Class II-M-2 and Class II-M-3
Certificates,
which relate to
and
are payable from the Group II Loans.
Class R Certificate:
Any one of the Class
R-I, Class R-II and Class
R-III Certificates.
Class R-I Certificate: Any one of the Class R-I Certificates
executed by
the Trustee and authenticated by the
Certificate Registrar
substantially in the
form annexed to the Standard Terms as Exhibit D and
evidencing
an interest
designated as a "residual interest" in REMIC I for purposes of the REMIC
Provisions.
Class R-II Certificate: Any one of the Class R-II
Certificates executed
by the Trustee and authenticated by the
Certificate Registrar
substantially in
the form annexed to the Standard
Terms as Exhibit D and
evidencing an
interest
designated as a "residual interest" in REMIC II for purposes of the REMIC
Provisions.
Class R-III
Certificate:
Any one of the Class R-III Certificates
executed by the Trustee and authenticated by the Certificate Registrar
substantially in the form annexed to the Standard Terms as Exhibit D and
evidencing an interest designated as a "residual interest" in REMIC III for
purposes of the REMIC Provisions.
Class I-A1 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 Sub-Group
I-1 Senior, Class R-I
and Class R-III 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) in
Sub-Loan Group I-1 immediately prior
to such Distribution Date.
Class I-A2 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 Sub-Group I-2 Senior 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) in Sub-Loan Group I-2
immediately prior to such Distribution Date.
10
<PAGE>
Class I-M
Certificates: The
Class I-M-1,
Class I-M-2 and Class
I-M-3
Certificates.
Class II-A 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 Group II Senior
Certificates
(other than the Class II-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) in Loan Group II
immediately prior to such Distribution
Date.
Class II-M Certificates: The Class II-M-1, Class II-M-2 and Class
II-M-3
Certificates.
Closing Date: March
30, 2005.
Compensating Interest:
With respect to any
Distribution Date and
each
Loan Group or Sub-Loan Group, as applicable, an amount equal to Prepayment
Interest Shortfalls resulting from Principal Prepayments in Full during the
related Prepayment Period and Curtailments
during the prior
calendar month and
included in the Available Distribution Amount for the such Loan Group or
Sub-Loan Group, as applicable, on such Distribution Date, but not
more than the
lesser of (a) one-twelfth of 0.125% of the
aggregate Stated Principal Balance of
the Mortgage Loans in the related Loan
Group or Sub-Loan
Group, as
applicable,
immediately preceding such Distribution Date and (b) the sum of the
Servicing
Fee and all income and gain on amounts
held in the
Custodial Account and the
Certificate Account and payable to the
Certificateholders
with respect to
the
Mortgage Loans in the related Loan Group or
Sub-Loan Group, as
applicable, and
such Distribution Date; provided that for
purposes of this definition the amount
of the Servicing Fee will not be reduced
pursuant to Section
7.02(a) except as
may be required pursuant to the last
sentence of such Section.
Corporate Trust Office: The principal office of the
Trustee at which at
any particular time its corporate trust business
with respect to this Agreement
shall be administered, which office at the date of the execution of this
instrument is located at 1761 East St.
Andrew Place, Santa Ana, California
92705-4934, Attention: Residential Funding
Corporation Series 2005-QS3.
Credit Support
Depletion Date: With
respect to Loan Group I, the first
Distribution Date on which the Certificate
Principal Balances of
the Class I-M,
Class I-B-1, Class I-B-2 and Class I-B-3
Certificates have been reduced to zero.
With respect to Loan Group II, the first Distribution Date on which the
Certificate Principal Balances of the Class
II-M, Class II-B-1, Class II-B-2 and
Class II-B-3 Certificates have been reduced
to zero.
Credit Repository: Equifax, Transunion and Experian, or their
successors
in interest.
Cut-off Date: March 1,
2005.
Determination Date:
With respect to any
Distribution Date, the
second
Business Day prior to each Distribution
Date.
11
<PAGE>
Discount Net
Mortgage Rate: With respect to Loan Group I, 5.50%
per
annum. With respect to Loan Group II, 5.00%
per annum.
Due Period: With
respect to each Distribution Date, the calendar month
in which such Distribution Date occurs.
Eligible Account:
An account that is any of the following: (i)
maintained with a depository institution
the debt obligations of which have been
rated by each Rating Agency in its highest
rating available, or
(ii) an account
or accounts in a depository institution in
which such accounts are fully insured
to the limits established by the FDIC,
provided that any deposits not so insured
shall, to the extent acceptable to each Rating Agency,
as evidenced in writing,
be maintained such that (as evidenced by an
Opinion of Counsel
delivered to the
Trustee and each Rating Agency) the
registered Holders of
Certificates
have a
claim with respect to the funds in such
account or a perfected
first security
interest against any collateral (which shall be limited to Permitted
Investments) securing such funds that is superior to claims of any other
depositors or creditors of the depository
institution with which such account is
maintained, or (iii) in the case of the
Custodial Account,
a trust account or
accounts maintained in the corporate
trust department of U.S. Bank,
National
Association, or (iv) in the case of the
Certificate Account, a trust account or
accounts maintained in the corporate
trust division of the
Trustee, or (v) an
account or accounts of a depository
institution acceptable to each Rating Agency
(as evidenced in writing by each
Rating Agency that use
of any such account as
the Custodial Account or the Certificate Account will not reduce the rating
assigned to any Class of Certificates by such Rating Agency below the
then-current rating assigned to such
Certificates by such Rating Agency).
Eligible Funds: With respect to any Distribution Date and Loan
Group, an
amount equal to the excess of (a) the
Available Distribution Amount for such
Loan Group or the Aggregate Available
Distribution Amount,
as applicable,
over
(b) the sum of (i) the aggregate amount of
Accrued Certificate
Interest on the
related Senior Certificates or the Aggregate Senior Interest Distribution
Amount, as applicable, (ii) the related Senior Principal
Distribution Amount or
Aggregate Senior Principal Distribution Amount, as applicable, (determined
without regard to Section 4.02(a)(ii)(Y)(D)
hereof), (iii) the related Class A-P
Principal Distribution Amount for both Sub-Loan Groups or Loan Group II, as
applicable (determined without regard to clause (E) of
the definition of Class
A-P Principal Distribution Amount) and (iv) the aggregate amount of Accrued
Certificate Interest on the Class I-M,
Class I-B-1 and Class I-B-2 Certificates,
or the Class II-M, Class II-B-1 and Class
II-B-2 Certificates, as applicable.
Excess Subordinate
Principal Amount:
With respect to any
Distribution Date
on which the aggregate Certificate
Principal Balance of the Class of Subordinate
Certificates in the Certificate
Group related to a
Loan Group then
outstanding
with the Lowest Priority is to be reduced to zero
and on which Realized
Losses
are to be allocated to such Class or Classes,
the excess,
if any, of (i) the
amount that would otherwise be distributable in respect of principal on
such
class or classes of Certificates on such
Distribution Date over (ii) the excess,
if any, of the aggregate Certificate Principal Balance of
such Class or Classes
of Certificates immediately prior to such Distribution Date
over the aggregate
amount of Realized Losses to be allocated to such
Classes of
Certificates
on
such Distribution Date as reduced by
any amount calculated with respect to that
12
<PAGE>
Loan Group pursuant to clause (E) of the definition of Class A-P Principal
Distribution Amount. The Excess Subordinate
Principal Amount will
be allocated
between the Sub-Loan Groups in Loan Group I on a pro
rata basis in
accordance
with the amount of Realized Losses on the Mortgage Loans in
each Sub-Loan Group
allocated to the Certificates on that
Distribution Date.
Fraud Loss
Amount: With respect to each Loan Group 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% (in the case of Group I
Loans) or 2.25% (in the case of Group II
Loans) of the aggregate outstanding
principal balance of the Mortgage Loans in the related Loan Group as of the
Cut-off Date minus the aggregate
amount of Fraud Losses
allocated solely to one
or more specific Classes of related
Certificates in accordance with Section 4.05
of this Series Supplement since the Cut-off Date up to such date of
determination, (Y) from the first to, but not
including, the second anniversary
of the Cut-off Date, an amount equal to (1) the lesser of (a) the
Fraud Loss
Amount for such Loan Group as of the most
recent anniversary of the Cut-off Date
and (b) 2.00% (in the case of Group I Loans) or
1.50% (in the case of Group II
Loans) of the aggregate outstanding principal balance of all of the Mortgage
Loans in the related Loan Group 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 related Certificates in accordance with Section
4.05
since the most recent anniversary of the Cut-off Date up to such date of
determination, and (Z) from the second to, but not including, the fifth
anniversary of the Cut-off Date, an amount equal to (1) the lesser
of (a) the
Fraud Loss Amount for the related
Loan Group 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 in the related Loan Group as of the most
recent
anniversary of the Cut-off Date minus (2) the
aggregate amount of
Fraud Losses
for the related Loan Group allocated
solely to one or more
specific Classes
of
Certificates in accordance with Section 4.05 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 for such Loan Group shall
be zero.
The Fraud Loss Amount
for a Loan
Group 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 related
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.
Group I Loans: The
Mortgage Loans designated on the Mortgage Loan
Schedule as Sub-Group I-1 Loans and
Sub-Group I-2 Loans.
Group II Loans: The
Mortgage Loans
designated
on the Mortgage Loan
Schedule as Group II Loans.
Group I Senior
Certificates: The
Class I-A1-1,
Class I-A1-2, Class
I-A1-3, Class I-A2-1, Class I-A2-2, Class I-A2-3, Class I-A2-4, Class
I-A2-5,
Class I-A2-6, Class I-A-V, Class I-A-P,
Class R-I and Class R-III Certificates.
13
<PAGE>
Group II Senior
Certificates: The
Class II-A-1, Class
II-A-V, Class
II-A-P and Class R-II Certificates, which relate to and payable from
the Group
II Loans.
Highest Priority: As of any date of determination, the Class of related
Subordinate Certificates then outstanding with
a Certificate
Principal Balance
greater than zero, with the earliest
priority for payments
pursuant to
Section
4.02(a), in the following order: (a) for
the Subordinate Certificates related to
Loan Group I, Class I-M-1, Class I-M-2, Class I-M-3, Class I-B-1, Class I-B-2
and Class I-B-3 Certificates and (b) for
the Subordinate Certificates related to
Loan Group II, Class II-M-1, Class II-M-2, Class II-M-3, Class II-B-1, Class
II-B-2 and Class II-B-3 Certificates.
Initial Monthly Payment Fund: $0.00, representing scheduled principal
amortization and interest at the Net
Mortgage Rate payable during the April 2005
Due Period, for those Mortgage Loans for which
the Trustee will not be entitled
to receive such payment.
Initial Notional Amount: With respect to the Class I-A-V
Certificates,
the aggregate Cut-off Date Principal Balance of
the Group I Loans; with respect
to the Class II-A-V Certificates, the aggregate Cut-off Date
Principal Balance
of the Group II Loans; and with respect to the Class I-A2-2
Certificates,
an
amount equal to the aggregate Certificate Principal Balance of
the Class I-A2-1
and Class I-A2-6 Certificates as of the Cut-Off Date. With respect to any
Subclass issued pursuant to Section
5.01(c), the aggregate Stated Principal
Balance of the Mortgage Loans corresponding to such Subclass as of the
Cut-Off
Date.
Initial Subordinate
Class Percentage: With respect to each Class of
related Subordinate Certificates, an amount which is equal to the initial
aggregate Certificate Principal Balance of such related Class of
Subordinate
Certificates divided by the aggregate Stated Principal Balance of all the
Mortgage Loans in the related Loan Group as
of the Cut-off Date as follows:
Class I-M-1: 2.85%
Class I-B-1: 0.50%
Class I-M-2: 0.90%
Class I-B-2: 0.30%
Class I-M-3: 0.50%
Class I-B-3: 0.45%
Class II-M-1: 2.15%
Class II-B-1:
0.15%
Class II-M-2: 0.20%
Class II-B-2:
0.10%
Class II-M-3: 0.30%
Class II-B-3:
0.15%
Interest Accrual
Period: With respect to any Class of
Certificates,
other than the Adjustable Rate Certificates, and any Distribution Date, the
calendar month preceding the month in which
such Distribution Date
occurs. The
Interest Accrual Period for the Adjustable
Rate Certificates is the one-month
period commencing on the 25th day of the
month preceding the month in which the
Distribution Date occurs and ending on the 24th day of the
month in which the
Distribution Date occurs.
Interest Only Certificates: Any one of the Class I-A-V, Class
II-A-V and
Class I-A2-2 Certificates. The Interest Only Certificates will have no
Certificate Principal Balance.
14
<PAGE>
LIBOR: With respect to any Distribution Date, the arithmetic mean
of the
London interbank offered rate quotations for
one-month U.S. Dollar
deposits,
expressed on a per annum basis, determined
in accordance with Section 1.03.
Loan Group: Any of
Loan Group I or Loan Group II.
Loan Group I: The
group of Mortgage Loans comprised of the Group I
Loans.
Loan Group II: The group of Mortgage Loans comprised of the Group II
Loans.
Lockout Percentage:
For any Distribution Date occurring prior to the
Distribution Date in April 2010, 0%, and for
any Distribution Date
thereafter,
as follows: 30% for any Distribution Date on or after April 2010 and
prior to
April 2011; 40% for any Distribution Date on or after April 2011 and
prior to
April 2012; 60% for any Distribution Date on or after April 2012 and
prior to
April 2013; 80% for any Distribution Date on or after April 2013 and
prior to
April 2014; and 100% for any Distribution
Date thereafter.
Lockout Share
Percentage: For any
distribution date, is
the product of (i)
the Lockout Percentage and (ii) a fraction the
numerator of which is the sum of
the aggregate Certificate Principal Balance of the Class
I-A2-4
Certificates,
the Class I-A2-5 Certificates and $35,000,000,
and the denominator of
which is
the sum of the Certificate Principal Balance of the Class
I-A2-1, Class I-A2-4,
Class I-A2-5 and Class I-A2-6
Certificates.
Lower Priority:
As of any date of determination and any Class of
Subordinate Certificates, any other Class of related
Subordinate
Certificates
then outstanding with a later priority for payments pursuant to Section 4.02
(a).
Lowest Priority: As of
any date of determination, the Class of related
Subordinate Certificates then outstanding with
a Certificate
Principal Balance
greater than zero, with the latest priority for payments pursuant to Section
4.02(a), in the following order: (a) for
the Subordinate Certificates related to
Loan Group I, Class I-B-3, Class I-B-2, Class I-B-1, Class I-M-3, Class I-M-2
and Class I-M-1 Certificates and (b) for
the Subordinate Certificates related to
Loan Group II, Class II-B-3, Class II-B-2, Class II-B-1, Class II-M-3, Class
II-M-2 and Class II-M-1 Certificates .
Maturity Date: With respect to Certificates in the Certificate Group
related to Loan Group I, March 25, 2035, the Distribution Date immediately
following the latest scheduled maturity date of any Mortgage Loan
in Loan Group
I. With respect to Certificates
in the Certificate
Group related to Loan
Group
II, March 25, 2020, the Distribution Date immediately following the latest
scheduled maturity date of any Mortgage
Loan in Loan Group II.
Mortgage Loan Schedule: The list or lists of the Mortgage Loans
attached
hereto as Exhibit One-I (with respect to Sub-Loan Group I-1), Exhibit One-II
(with respect to Sub-Loan Group I-2) and Exhibit
One-III (with respect
to Loan
Group II) (in each case, 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 in the related Loan Group or
Sub-Loan Group, as applicable:
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<PAGE>
(i)
the Mortgage Loan identifying number ("RFC LOAN #");
(ii)
the maturity of the Mortgage Note ("MATURITY DATE");
(iii)
the Mortgage Rate ("ORIG RATE");
(iv)
the Subservicer pass-through rate ("CURR NET");
(v)
the Net Mortgage Rate ("NET MTG RT");
(vi)
the Pool Strip Rate ("STRIP");
(vii)
the initial scheduled
monthly payment of
principal, if any,
and interest ("ORIGINAL P & I");
(viii)
the Cut-off Date Principal Balance ("PRINCIPAL BAL");
(ix)
the Loan-to-Value Ratio at origination ("LTV");
(x)
the rate at which the Subservicing Fee accrues ("SUBSERV FEE")
and at which the Servicing Fee accrues ("MSTR SERV FEE");
(xi)
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
(xii)
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.
Notional Amount: As of
any Distribution
Date, (i) with respect
to the
Class I-A2-2 Certificates, an amount equal to the aggregate Certificate
Principal Balance of the Class I-A2-1 and
Class I-A2-6 Certificates immediately
prior to the related Distribution Date; (ii) with respect to any Class I-A-V
Certificates or Subclass thereof issued pursuant to Section 5.01(c), the
aggregate Stated Principal Balance of the Group I Loans
corresponding to
the
Uncertificated Class A-V REMIC Regular
Interests represented by such Class or
Subclass immediately prior to such date; and (iii) with respect to any Class
II-A-V Certificates or Subclass thereof
issued pursuant to Section 5.01(c), the
aggregate Stated Principal Balance of the Group II Loans
corresponding to
the
Uncertificated Class A-V REMIC Regular
Interests represented by such Class or
Subclass immediately prior to such
date.
Pass-Through Rate: With respect to the Senior Certificates (other than
the Adjustable Rate Certificates, Class A-V Certificates and Class A-P
Certificates), Class M Certificates and Class B Certificates and any
Distribution Date, the per annum rates set
forth in the
Preliminary
Statement
hereto.
16
<PAGE>
o
With respect to the
Class I-A2-1
Certificates
and the initial
Interest Accrual Period, 3.35% per annum, and as to any
Interest
Accrual Period
thereafter, a per
annum rate equal to LIBOR plus
0.50%, subject to a maximum rate equal to the Available Funds
Cap
and a minimum rate of 0. 50% per annum.
o
With respect to the
Class I-A2-2
Certificates
and the initial
Interest
Accrual Period, 2.15%
per annum, and as to any Interest
Accrual Period thereafter, a per annum rate equal to 5.00%
minus
LIBOR, subject to a maximum rate of 5.00% per annum and a
minimum
rate of 0.00% per annum.
o
With respect to the
Class I-A2-6
Certificates
and the initial
Interest Accrual Period, 3.35% per annum, and as to any
Interest
Accrual Period
thereafter, a per
annum rate equal to LIBOR plus
0.50%, subject to a maximum rate equal to the Available Funds
Cap
and a minimum rate of 0.50% per annum.
With respect to each
Class of Class A-V
Certificates (other
than any
Subclass thereof) and any Distribution Date, a rate equal to the weighted
average, expressed as a percentage, of the Pool Strip Rates of all
Mortgage
Loans in the related Loan Group 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). With respect to the Class
I-A-V Certificates and the Class II-A-V
Certificates and the initial Distribution
Date the Pass-Through Rate is equal to
0.4059% and 0.4051% per annum, respectively. 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 in the related Loan Group
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 Class A-P Certificates have no
Pass-Through Rate and are not entitled to
Accrued Certificate Interest.
Pool Strip Rate: With respect to each Mortgage Loan in any Loan
Group, 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 for such Loan Group (but not
less
than 0.00%) per annum.
Permitted Investments:
One or more of the following:
(i) obligations
of or guaranteed as to timely payment of principal and
interest by the United States or any agency or instrumentality thereof
when such obligations
are backed by the full faith and credit of the
United States;
(ii) repurchase
agreements on
obligations
specified in clause
(i) maturing
not more than one month from the date of acquisition thereof, provided
that the unsecured
short-term debt obligations of the party agreeing to
repurchase such
obligations are at the time rated by each Rating Agency
in its highest short-term rating available;
17
<PAGE>
(iii) federal funds, certificates of deposit,
demand deposits, time
deposits
and bankers'
acceptances (which shall each have an original maturity of
not more than 90 days and, in the case of bankers' acceptances,
shall in
no event have an original maturity of more than 365 days or
a remaining
maturity of more than 30 days) denominated in United States dollars of
any U.S. depository
institution or trust company incorporated under the
laws of the United States or any state thereof or of any domestic
branch
of a foreign depository institution or trust company; provided that the
debt obligations of such depository institution or trust company at
the
date of acquisition thereof have been rated by each Rating Agency
in its
highest short-term rating available; and, provided further that, if
the
original maturity of such short-term obligations of a domestic
branch of
a foreign depository
institution or trust company shall exceed 30 days,
the short-term rating
of such institution
shall be A-1+ in the case of
Standard & Poor's if Standard & Poor's is a Rating
Agency;
(iv) commercial
paper and demand notes
(having original maturities of not
more than 365 days) of any corporation incorporated under the laws of
the United States or any state thereof which on the date of
acquisition
has been rated by each Rating Agency in its highest short-term rating
available; provided
that such commercial
paper shall have a
remaining
maturity of not more than 30 days;
(v) any mutual fund,
money market fund, common trust fund or other
pooled
investment vehicle,
the assets of which are limited to instruments that
otherwise would constitute Permitted Investments hereunder and have
been
rated by each Rating Agency in its highest short-term rating available
(in the case of Standard & Poor's such rating shall be either AAAm or
AAAm-G), including
any such fund that is
managed by the Trustee or any
affiliate of
the Trustee or for which the Trustee or any of its
affiliates acts as an adviser; and
(vi) other obligations or securities that are acceptable to each Rating
Agency as a Permitted
Investment
hereunder and will not reduce the
rating assigned
to any Class of
Certificates
by such Rating Agency
(without giving effect to any Certificate Policy (if any) in the
case of
Insured Certificates
(if any)) below the then-current rating, as
evidenced in writing;
provided, however, that no instrument shall be a Permitted
Investment if
it represents, either (1) the right to receive
only interest payments with
respect to the underlying debt instrument or (2) the right to receive both
principal and interest payments derived from obligations underlying such
instrument and the principal and interest payments with respect to such
instrument provide a yield to maturity greater than 120% of the yield to
maturity at par of such underlying
obligations. References herein to the highest
rating available on unsecured long-term debt shall mean AAA in the case of
Standard & Poor's and Fitch and Aaa in
the case of Moody's,
and for purposes of
this Agreement, any references herein to the highest rating available on
unsecured commercial paper and short-term debt obligations shall mean the
following: A-1 in the case of Standard &
Poor's, P-1 in the case of Moody's and
F-1 in the case of Fitch; provided,
however, that any
Permitted Investment that
is a short-term debt obligation
rated A-1 by Standard
& Poor's must satisfy the
18
<PAGE>
following additional conditions: (i) the total amount of debt from
A-1 issuers
must be limited to the investment of monthly principal and interest payments
(assuming fully amortizing collateral);
(ii) the total amount of A-1 investments
must not represent more than 20% of the aggregate outstanding Certificate
Principal Balance of the Certificates and
each investment must not mature beyond
30 days; (iii) the terms of the debt must
have a predetermined fixed dollar
amount of principal due at maturity that cannot vary; and (iv) if the
investments may be liquidated prior to their maturity or are
being relied on to
meet a certain yield, interest must be tied
to a single interest rate index plus
a single fixed spread (if any) and must
move proportionately with that index.
Prepayment
Assumption: With
respect to Sub-Loan Group I-1, the
prepayment assumption to be used for
determining the
accrual of original issue
discount and premium and market discount on
the related Certificates for federal
income tax purposes, which assumes a constant
prepayment rate of 6.0% per annum
of the then outstanding principal balance of the Sub-Group I-1 Loans in the
first month of the life of such Sub-Group I-1 Loans and an additional
approximately 1.090909091% per annum in each
month thereafter until the twelfth
month, and beginning in the twelfth month
and in each month
thereafter during
the life of the Sub-Group I-1 Loans, a constant prepayment rate of 18.0% per
annum. With respect to Sub-Loan Group I-2,
the prepayment
assumption to be used
for determining the accrual of original
issue discount and
premium and market
discount on the related Certificates for federal income tax purposes, which
assumes a constant prepayment rate of 10.0% per annum of the
then outstanding
principal balance of the Sub-Group I-2 Loans in the first
month of the life of
such Sub-Group I-2 Loans and an additional
approximately
0.909090909% per annum
in each month thereafter until the twelfth month, and
beginning in the twelfth
month and in each month thereafter during
the life of the Sub-Group I-2 Loans, a
constant prepayment rate of 20.0% per
annum. With respect to Loan Group II, the
prepayment assumption to be used for
determining the
accrual of original issue
discount and premium and market discount on
the related Certificates for federal
income tax purposes, which assumes a constant
prepayment rate of 6.0% per annum
of the then outstanding principal balance of the Group II Loans in the
first
month of the life of such Group II Loans and an additional approximately
1.090909091% per annum in each month
thereafter
until the twelfth
month, and
beginning in the twelfth month and in each
month thereafter
during the life of
the Group II Mortgage Loans, a constant
prepayment rate of 18.0% per annum.
Prepayment
Distribution
Percentage: With
respect to any
Distribution
Date and each Class of Subordinate
Certificates
in the Certificate Group for
each Loan Group, under the applicable circumstances set forth below, the
respective percentages set forth below:
(i) For
any Distribution Date prior to the Distribution Date in April
2010 (unless the
Certificate Principal
Balances of the
related
Senior
Certificates
(other than the related Class A-P
Certificates), have been reduced to zero), 0%.
(ii) For any
Distribution
Date not discussed in clause (i) above
on
which any Class of related Subordinate Certificates are
outstanding:
(a) in the
case of the Class of related 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
19
<PAGE>
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 related Subordinate Certificates then
outstanding with the
Highest Priority and
(2) all other Classes
of related
Subordinate
Certificates
for which the
respective
Prepayment Distribution Triggers have been satisfied; and
(b) in the case of each other Class of related 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.
Prepayment
Distribution Trigger:
With respect to any Distribution Date
and any Class of related Subordinate Certificates (other than the Class I-M-1
Certificates and the Class II-M-1
Certificates), a test
that shall be satisfied
if the fraction (expressed as a percentage) equal
to the sum of the Certificate
Principal Balances of such Class and each Class of related Subordinate
Certificates with a Lower Priority than such Class
immediately
prior to such
Distribution Date divided by the aggregate
Stated Principal
Balance of all of
the Mortgage Loans (or related REO Properties) in the related Loan Group
immediately prior to such Distribution Date is
greater than or equal to the sum
of the related Initial Subordinate Class Percentages of
such Classes of related
Subordinate Certificates.
Principal Only Certificates: Any one of the Class I-A-P
Certificates and
Class II-A-P Certificates.
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<PAGE>
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 preceding the month in which the
related
Distribution Date occurs. With respect to the Adjustable
Rate Certificates and
any Distribution Date provided the Adjustable Rate Certificates are in
book-entry form, the close of business on the Business Day prior to that
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. As to any Uncertificated REMIC II Regular Interest,
those classes of Certificates identified as
"Related Classes of Certificates" to
such Uncertificated REMIC II Regular Interest in the definition of
Uncertificated REMIC II Regular
Interest.
REMIC I: The segregated pool of assets (exclusive of the Yield
Maintenance Agreement, which is not an asset of any
REMIC), with respect to
which a REMIC election is to be made,
consisting of:
(i) the
Group I Loans and the related Mortgage Files,
(ii) all
payments and collections in respect of the Group I
Loans due after the
Cut-off Date (other than Monthly
Payments due in the month of the Cut-off Date) as shall be
on deposit in the Custodial Account or in the Certificate
Account and identified
as belonging to the Trust Fund,
including the proceeds from the liquidation of Additional
Collateral for any
Additional
Collateral
Loan, but not
including amounts
on deposit in the Initial Monthly
Payment Fund,
(iii) property
which secured a Group I 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, the
Pledged Assets with respect to each
Pledged Asset
Mortgage Loan, and the interest in the
Surety Bond transferred to the Trustee pursuant to Section
2.01 herein, in each case related to Group I Loans, 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, with respect to which a REMIC
election is to be made, consisting of: (i) the Group II Loans and the
related
Mortgage Files,
(ii) all
payments and
collections
in respect of the
Group II
Loans due after the
Cut-off Date (other than Monthly
Payments due in the month of the Cut-off Date) as shall be
on deposit in the Custodial Account or in the Certificate
21
<PAGE>
Account and identified
as belonging to the Trust Fund,
including the proceeds from the liquidation of Additional
Collateral for any
Additional
Collateral
Loan, but not
including amounts
on deposit in the Initial Monthly
Payment Fund,
(iii) property
which secured a Group
II 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, the
Pledged Assets with respect to each
Pledged Asset
Mortgage Loan, and the interest in the
Surety Bond transferred to the Trustee pursuant to Section
2.01 herein, in each case related to Group II Loans, and
(v) all
proceeds of clauses (i) through (iv) above.
REMIC II
Certificates: The
Class R-II Certificates.
REMIC III:
The segregated pool of assets consisting of the
Uncertificated REMIC I Regular Interests
and the Uncertificated REMIC II 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 and the Class
R-II Certificates) pursuant to Section 2.06,
with respect to which
a separate
REMIC election is to be made.
REMIC III Certificates: Any Class of Certificates (other
than the Class
R-I Certificates and the Class R-II
Certificates).
Senior Accelerated
Distribution
Percentage:
With
respect to any
Distribution Date occurring on or prior to the
60th Distribution
Date and any
Loan Group or Sub-Loan Group, as applicable, 100%. With respect to any
Distribution Date thereafter and such Loan Group or Sub-Loan Group, as
applicable, as follows:
(i) for any
Distribution
Date after the 60th
Distribution
Date but on or
prior to the 72nd
Distribution Date, the
related Senior Percentage for
such Distribution Date
plus 70% of the related Subordinate Percentage
for such Distribution Date;
(ii) for any Distribution Date after the 72nd Distribution Date but on or
prior to the 84th
Distribution Date, the
related Senior Percentage for
such Distribution Date
plus 60% of the related Subordinate Percentage
for such Distribution Date;
(iii) for any Distribution Date after the 84th Distribution Date but on or
prior to the 96th
Distribution Date, the
related Senior Percentage for
such Distribution Date
plus 40% of the related Subordinate Percentage
for such Distribution Date;
(iv) for any Distribution Date after the 96th Distribution Date but on or
prior to the 108th
Distribution Date, the related Senior Percentage for
such Distribution Date
plus 20% of the related Subordinate Percentage
for such Distribution Date; and
22
<PAGE>
(v) for any
Distribution Date thereafter, the related Senior Percentage
for
such Distribution Date;
provided, however,
(i) that any scheduled reduction to the Senior Accelerated
Distribution
Percentage described above shall not occur as
of any Distribution
Date unless
either:
(a)(1)(X) the outstanding principal balance of the Mortgage
Loans
in the related Loan Group delinquent 60 days or more (including
Mortgage
Loans which are in
foreclosure,
have been foreclosed or otherwise
liquidated, or with
respect to which the Mortgagor is in bankruptcy and
any REO Property)
averaged over the last six months, as a percentage of
the aggregate
outstanding
Certificate Principal Balance of the related
Subordinate
Certificates, is
less than 50% or (Y) the outstanding
principal balance of Mortgage Loans in the related Loan Group
delinquent
60 days or more (including Mortgage Loans which are in foreclosure,
have
been foreclosed or
otherwise liquidated,
or with respect to
which the
Mortgagor is in bankruptcy and any REO Property) averaged over the last
six months, as a
percentage
of the aggregate outstanding principal
balance of all Mortgage Loans in the related Loan Group
averaged over
the last six months,
does not exceed 2% and (2) Realized Losses on the
Mortgage Loans in the
related Loan Group to date for such Distribution
Date if occurring during the sixth, seventh, eighth, ninth or tenth
year
(or any year thereafter) after the Closing Date are less
than 30%, 35%,
40%, 45% or 50%,
respectively,
of the sum of the
Initial
Certificate
Principal Balances of the related Subordinate Certificates; or
(b)(1) the outstanding
principal balance of Mortgage Loans in
the related Loan Group
delinquent 60 days or more (including Mortgage
Loans which are in
foreclosure,
have been foreclosed or otherwise
liquidated, or with
respect to which the Mortgagor is in bankruptcy and
any REO Property)
averaged over the last six months, as a percentage of
the aggregate outstanding principal balance of all Mortgage Loans
in the
related Loan Group averaged over the last six months, does not
exceed 4%
and (2) Realized
Losses on the Mortgage Loans in the related Loan Group
to date for such
Distribution Date,
if occurring during the sixth,
seventh, eighth, ninth
or tenth year (or any year thereafter) after the
Closing Date are less than 10%, 15%, 20%, 25% or 30%, respectively, of
the sum of the Initial
Certificate
Principal Balances of the related
Subordinate Certificates; and
(ii) that for any Distribution Date on which the related Senior
Percentage is greater than the related
Senior Percentage as of the Closing Date,
the related Senior Accelerated Distribution Percentage for such Distribution
Date shall be 100%.
Notwithstanding the
foregoing,
upon the reduction of
the Certificate
Principal Balances of the Senior Certificates related to a Loan Group or
Sub-Loan Group, as applicable, (other than the related Class A-P
Certificates,
if any) to zero, the related Senior
Accelerated
Distribution
Percentage shall
thereafter be 0%.
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<PAGE>
Senior Certificate:
Any one of the
Sub-Group I-1 Senior
Certificates,
Sub-Group I-2 Senior Certificates or Group
II Senior
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.
Senior Interest
Distribution Amount:
With respect to any
Distribution
Date and a Sub-Loan Group the amount of
Accrued Certificate Interest required to
be distributed from the related Available
Distribution Amount to
the Holders of
the Certificates in the related Certificate Sub-Group and the Class I-A-V
Certificates on such Distribution Date
pursuant to Sections 4.02(a)(i).
Senior Percentage: The
Class I-A1 Percentage,
Class I-A2 Percentage or
Class II-A Percentage, as applicable.
Senior Principal
Distribution Amount:
With respect to any Distribution
Date and Loan Group or Sub-Loan Group, as applicable, the lesser of (a) the
balance of the related Available Distribution Amount remaining after the
distribution of all amounts required to be distributed
therefrom pursuant to
Section 4.02(a)(i) and Section 4.02(a)(ii)(X) (excluding any amount
distributable pursuant to clause (E) of the
definition of "Class
A-P Principal
Distribution Amount"), and (b) the sum of
the amounts required to be distributed
to the Senior Certificateholders of the
related Certificate Group or Certificate
Sub-Group on such Distribution Date pursuant to Sections 4.02(a)(ii)(Y) and
4.02(a)(xvi).
Special Hazard Amount:
As of any Distribution
Date and Loan Group,
an
amount equal to (a) with respect to Loan Group I, $3,715,998 and (b) with
respect to Loan Group II, 1,978,376, in each case minus the sum of (i) the
aggregate amount of Special Hazard Losses allocated solely to one or more
specific Classes of Certificates in the
related Certificate
Group 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 greater of (i) the
product of the related
Special Hazard
Percentage for such anniversary
multiplied by the
outstanding principal balance
of all the Mortgage Loans in the related Loan Group on
the Distribution
Date
immediately preceding such anniversary and
(ii) twice the outstanding principal
balance of the Mortgage Loan in the related Loan Group with the largest
outstanding principal balance as of the
Distribution Date immediately preceding
such anniversary and (B) the greater of
(i) the product of 0.50% multiplied by
the outstanding principal balance of all Mortgage Loans in the related Loan
Group 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 in the related Loan Group
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 in the related Loan
Group, expressed as a percentage, and the
denominator of which is equal to 22.66%, in
the case of Loan Group I and 19.01%,
in the case of Loan Group II (which percentages are equal to the respective
percentages of Mortgage Loans in the related Loan Group by
aggregate
principal
24
<PAGE>
balance 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 in the
related Loan Group secured by a Mortgaged Property (or, with respect to a
Cooperative Loan, the related Cooperative Apartment) located in the State of
California.
The related 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 related
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.
Special Hazard
Percentage:
With respect to each
Loan Group as of each
anniversary of the Cut-off Date, the greater of (i) 1.0% and (ii)
the largest
percentage obtained by dividing the
aggregate outstanding
principal balance (as
of immediately preceding Distribution Date)
of the Mortgage Loans in the related
Loan Group secured by Mortgaged
Properties located in
a single, five-digit
zip
code area in the State of California by the
outstanding principal balance of all
the Mortgage Loans in the related Loan Group as
of the immediately
preceding
Distribution Date.
Sub-Group I-1 Loans:
The Mortgage Loans designated on the Mortgage Loan
Schedule as Sub-Group I-1 Loans.
Sub-Group I-2 Loans:
The Mortgage Loans designated on the Mortgage Loan
Schedule as Sub-Group I-2 Loans.
Sub-Group I-1 Senior
Certificates:
The Class I-A-1, Class I-A-2 and
Class I-A-3 Certificates, which relate to and are payable
primarily from the
Sub-Group I-1 Loans.
Sub-Group I-2 Senior Certificates: The Class I-A2-1, Class I-A2-2,
Class
I-A2-3, Class I-A2-4, Class I-A2-5 and Class I-A2-6
Certificates, which
relate
to and are payable primarily from the
Sub-Group I-2 Loans.
Sub-Group I-1 Loans:
The Mortgage Loans designated on the Mortgage Loan
Schedule as Sub-Group I-1 Loans.
Sub-Loan Group: Any of Sub-Loan Group I-1 or Sub-Loan Group
I-2.
Sub-Loan Group
I-1: The group of Mortgage Loans comprised of the
Sub-Group I-1 Loans.
Sub-Loan Group
I-2: The group of Mortgage Loans comprised of the
Sub-Group I-2 Loans.
Subordinate
Certificate: With
respect to Loan Group
I, any one of the
Class I-M Certificates or Class I-B-1,
Class I-B-2 and Class I-B-3 Certificates,
executed by the Trustee and authenticated by the Certificate Registrar
substantially in the form annexed hereto as Exhibit B and Exhibit C,
respectively. With respect to Loan Group II, any one of the Class II-M
Certificates or Class II-B-1, Class II-B-2 and Class II-B-3 Certificates,
executed by the Trustee and authenticated by the Certificate Registrar
substantially in the form annexed hereto as Exhibit B and Exhibit C,
respectively.
25
<PAGE>
Subordinate Class Percentage: With respect to any Distribution
Date and
any Class of Subordinate Certificates, a fraction, expressed as a percentage,
the numerator of which is the aggregate
Certificate
Principal Balance of such
Class of Subordinate Certificates immediately prior to such date and the
denominator of which is the aggregate
Stated Principal Balance of all of the
Mortgage Loans in the related Loan Group
(or related REO Properties) (other than
the related Discount Fraction of each related Discount Mortgage Loan)
immediately prior to such Distribution
Date.
Subordinate Component:
With respect to each Sub-Loan Group and any
Distribution Date, the aggregate Stated
Principal Balance of the Mortgage Loans
in the related Sub-Loan Group, less the Discount Fraction of the Discount
Mortgage Loans in the case of Sub-Loan
Group I-1, for that
Distribution
Date
minus the aggregate Certificate Principal Balance of the Certificates in the
related Certificate Sub-Group immediately
prior to that distribution date.
Subordinate
Percentage: With
respect to either Loan
Group or Sub-Loan
Group, as applicable, as of any date of
determination a percentage equal to 100%
minus the related Senior Percentage as of
that date.
Subordinate
Principal
Distribution
Amount: With
respect to any
Distribution Date and Loan Group and each Class of related Subordinate
Certificates, (a) the sum of the following: (i) such Class's pro rata share,
based on the Certificate Principal Balance of each Class of
related Subordinate
Certificates then outstanding, of the aggregate of the amounts calculated
(without giving effect to the related
Senior Percentages)
for such Distribution
Date for the related Loan Group under clauses (1), (2) and (3) of Section
4.02(a)(ii)(Y)(A) to the extent not payable to the
related Senior Certificates;
(ii) such Class's pro rata share, based on
the Certificate
Principal Balance of
each Class of related Subordinate Certificates then outstanding, of the
principal collections described in Section
4.02(a)(ii)(Y)(B)(b)
for the related
Loan Group (without giving effect to the
related Senior Accelerated Distribution
Percentages) to the extent such collections
are not otherwise distributed to the
related 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 for the related Loan Group (other than the related
Discount Fraction of such Principal
Prepayments in Full
and Curtailments
with
respect to a related Discount Mortgage Loan) to the extent not payable to
the
related Senior Certificates; (iv) if such Class is the Class of related
Subordinate Certificates with the Highest Priority, any related Excess
Subordinate Principal Amount for the related Loan Group
for such
Distribution
Date not paid to the related Senior
Certificates; 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 related
Subordinate
Certificates minus (b) the sum of (i) with
respect to the Class of Subordinate
Certificates with the Lowest Priority,
any related Excess
Subordinate Principal
Amount for such Distribution Date; and (ii) the related Capitalization
Reimbursement Amount for such Loan Group and
Distribution Date,
other than the
26
<PAGE>
related Discount Fraction of any portion of that
amount related to each related
Discount Mortgage Loan in the related Loan
Group, multiplied by a
fraction, the
numerator of which is the Subordinate Principal Distribution Amount for such
Class of related 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 in
the related
Certificate Group (other
than the Class A-P Certificates), without giving effect to any reductions
for
the Capitalization Reimbursement
Amount.
Super Senior
Certificates:
Any of the Class
I-A2-1 or Class I-A2-4
Certificates.
Super Senior Optimal
Percentage:
As to any Distribution
Date on and after
the Credit Support Depletion Date for Sub-Loan Group
I-2 and any class of Super
Senior Certificates, a percentage expressed as a fraction,
the numerator of
which is the Certificate Principal Balance of that class of Super Senior
Certificates immediately prior to that
distribution date and the denominator of
which is the aggregate Certificate
Principal Balance of the Sub-Group I-2 Senior
Certificates immediately prior to that
distribution date.
Super Senior Optimal
Principal Distribution
Amount: As to any
Distribution
Date on and after the Credit Support Depletion Date and any class of Super
Senior Certificates, an amount equal to the product of
(a) the then-applicable
Super Senior Optimal Percentage for that
class of Super Senior
Certificates and
(b) the amounts described in Section 4.02(a)(ii)(Y) with respect to Sub-Loan
Group I-2.
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, (ii) as to each Uncertificated REMIC I Regular Interest Z and each
Uncertificated REMIC III Regular Interest Z1, an amount equal to one month's
interest at the Pool Strip Rate of the
related Mortgage
Loan on the
principal
balance of such Mortgage Loan reduced by
such Interest's
pro-rata share of
any
prepayment interest shortfalls or other
reductions of interest allocable to the
Class I-A-V Certificates, (iii) as to each Uncertificated REMIC II Regular
Interest other than each Uncertificated REMIC II 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 II Regular Interest and (iv) as to each Uncertificated
REMIC II Regular Interest Z and each
Uncertificated
REMIC III Regular
Interest
Z2, an amount equal to one month's interest at the Pool Strip Rate of the
related Mortgage Loan on the principal
balance of such
Mortgage Loan reduced by
such Interest's pro-rata share of any prepayment
interest shortfalls or other
reductions of interest allocable to the
Class II-A-V Certificates.
Uncertificated
Pass-Through
Rate: With
respect to each of the
Uncertificated REMIC I Regular Interests,
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 and each Uncertificated REMIC III Regular Interest
Z1, the Pool Strip Rate for the related
Mortgage Loan.
With respect to each
of
27
<PAGE>
the Uncertificated REMIC II Regular Interests, other than the Uncertificated
REMIC II Regular Interests Z, the per annum rate
specified in the definition of
Uncertificated REMIC II Regular Interests.
With respect to each
Uncertificated
REMIC II Regular Interest Z and each
Uncertificated
REMIC III Regular
Interest
Z2, the Pool Strip Rate for the related
Mortgage Loan.
Uncertificated
Principal Balance:
With respect to each
Uncertificated
REMIC I Regular Interest, as defined in the
definition of Uncertificated REMIC I
Regular Interest. With respect to each
Uncertificated REMIC II Regular Interest,
as defined in the definition of
Uncertificated REMIC II 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).
28
<PAGE>
<TABLE>
-----------------------
--------------------------------- ------------------
--------------------
Uncertificated REMIC Related Classes of
Certificates
Pass-Through Rate Initial Principal
I Regular Interest
Balance
-----------------------
--------------------------------- ------------------
--------------------
<S>
<C>
<C>
<C>
<C>
W
Class I-A2-1, Class I-A2-2,
5.50%
$173,143,700
Class I-A2-6
-----------------------
--------------------------------- ------------------
--------------------
X
Class I-A-P
0.00%
$781,468
-----------------------
--------------------------------- ------------------
--------------------
Y
Class I-A1-1, Class I-A1-2,
5.50%
$197,674,396
Class I-A1-3, Class I-A2-3,
Class I-A2-4,
Class I-A2-5, Class R-I, Class I-M-1,
Class I-M-2,
Class I-M-3,
Class I-B-1, Class I-B-2,
Class I-B-3
-----------------------
--------------------------------- ------------------
--------------------
</TABLE>
Uncertificated REMIC
II Regular Interests:
The Uncertificated REMIC II
Regular Interests Z together with the
interests identified
in the table below,
each representing an undivided beneficial ownership interest in REMIC II, and
having the following characteristics:
1. The
principal balance from time to time of each Uncertificated
REMIC II
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 II 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 II Regular Interest in such table.
2. The
Uncertificated
Pass-Through Rate for each Uncertificated REMIC II
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 II Distribution Amount for each REMIC II
Regular Interest
identified
in the table below shall be, for any
Distribution Date, the
amount deemed
distributed with
respect to such
Uncertificated REMIC
II Regular
Interest on such Distribution Date
pursuant to the provisions of Section 10.04(a).
29
<PAGE>
<TABLE>
<CAPTION>
-----------------------
--------------------------------- ------------------
--------------------
Uncertificated REMIC Related Classes of
Certificates
Pass-Through Rate Initial Principal
II Regular Interest
Balance
-----------------------
--------------------------------- ------------------
--------------------
<S>
<C>
<C>
<C>
W
Class II-A-1
5.00%
$100,604,000
-----------------------
--------------------------------- ------------------
--------------------
X
Class II-A-P
0.00%
$781,468
-----------------------
--------------------------------- ------------------
--------------------
Y
Class II-M-1, Class II-M-2,
5.00%
$3,171,640
Class II-M-3, Class II-B-1,
Class II-B-2, Class II-B-3
-----------------------
--------------------------------- ------------------
--------------------
</TABLE>
Uncertificated
REMIC I Regular Interests Z: Each of the 2,650
uncertificated partial undivided beneficial ownership interests in the Trust
Fund, numbered sequentially from 1 to 2,650, each relating to the
particular
Mortgage Loan identified by such 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 747
uncertificated partial undivided beneficial ownership interests in the Trust
Fund, numbered sequentially from 1 to 747, each relating to the particular
Mortgage Loan identified by such 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
II Regular Interests Z 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).
Uncertificated REMIC
II Regular Interest
Distribution
Amounts: With
respect to each Uncertificated REMIC II Regular Interest, other than the
Uncertificated REMIC II Regular Interests Z, the amount specified as the
Uncertificated REMIC II Regular Interest Distribution Amount with respect
thereto in the definition of Uncertificated REMIC II Regular Interests. With
respect to the Uncertificated REMIC II Regular Interests Z, the
Uncertificated
REMIC II Regular Interests Z Distribution
Amount.
Uncertificated REMIC
III Regular Interests Z1: Each of the 2,650
uncertificated partial undivided beneficial ownership interests in REMIC III
numbered sequentially from 1 through 2,650 each relating to the identically
numbered Uncertificated REMIC I Regular Interests Z, each having no
principal
balance and bearing interest at a rate equal to the
related Pool Strip
Rate on
the Stated Principal Balance of the Mortgage
Loan related to the
identically
numbered Uncertificated REMIC I Regular Interests Z, comprising such
Uncertificated REMIC III Regular Interests Z1's pro rata share of the
amount
distributed pursuant to Section
10.04(a).
30
<PAGE>
Uncertificated
REMIC III Regular Interests Z2: Each of the 747
uncertificated partial undivided beneficial ownership interests in REMIC III
numbered sequentially from 1 through 747 each relating to the identically
numbered Uncertificated REMIC II Regular Interests Z, each
having no principal
balance and bearing interest at a rate equal to the
related Pool Strip
Rate on
the Stated Principal Balance of the Mortgage
Loan related to the
identically
numbered Uncertificated REMIC II Regular Interests Z, comprising such
Uncertificated REMIC III Regular Interests Z2's pro rata share of the
amount
distributed pursuant to Section
10.04(a).
Uncertificated REMIC
III Regular Interests
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 and Uncertificated
REMIC II Regular Interests Z for such Distribution Date pursuant to Section
10.04(a).
Undercollateralized
Amount: With respect any Certificate Sub-Group and
Distribution Date, the excess of (i) the
aggregate Certificate Principal Balance
of such Certificate Sub-Group over (ii) the aggregate
Stated Principal
Balance
of the Mortgage Loans in the related
Sub-Loan Group, in
each case calculated on
such Distribution Date after giving effect to
distributions to be made thereon
(other than amounts to be distributed pursuant to Section 4.02(j) on such
Distribution Date).
Undercollateralized Certificate Sub-Group: With respect any
Distribution
Date, a Certificate Sub-Group for which the
related
Undercollateralized
Amount
exceeds zero.
Underwriter: Deutsche
Bank Securities Inc.
Yield Maintenance Agreement: The agreement dated as of the Closing
Date,
between the Trustee and the Yield
Maintenance Agreement
Provider, relating to
each of the Class I-A2-1 and Class I-A2-6 Certificates, or any replacement,
substitute, collateral or other arrangement
in lieu thereto.
Yield Maintenance
Agreement Provider: Barclays Bank PLC, and its
successors and assigns or any party to any
replacement,
substitute,
collateral
or other arrangement in lieu thereof.
Yield Maintenance
Payment: For any
Distribution Date, the payment, if
any, due under the Yield Maintenance Agreement in respect of such
Distribution
Date.
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.
31
<PAGE>
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:
On each Distribution Date, LIBOR shall be established by the
Trustee and
as to any Interest Accrual Period for the Adjustable
Rate Certificates,
other
than the initial Interest Accrual Period, LIBOR will equal the rate for
United
States dollar deposits for one month which
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 that Interest
Accrual Period, or the LIBOR rate adjustment
date. Telerate Screen Page 3750
means the display designated as page 3750 on the
Telerate Service or
any other
page as may replace page 3750 on that service for the purpose of displaying
London interbank offered rates of major banks.
If the rate does not
appear on
that page or any other page as may replace
that page on that service, or if the
service is no longer offered, any other service for displaying LIBOR or
comparable rates that 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 three major banks that are engaged in
transactions
in the London
interbank
market, selected by the trustee after
consultation with the Master Servicer. The
reference bank rate will be determined 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 London office of each of the
reference banks to provide a quotation of
its rate. If at least two quotations are provided, the rate will be the
arithmetic mean of the quotations. If on
that 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
that 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 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, 2.85% per annum; provided
however, if, under the priorities listed
previously in this paragraph, 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 London,
England are required or authorized by law
to be closed.
32
<PAGE>
The establishment
of LIBOR by the
Trustee and the Master Servicer's
subsequent calculation of the Pass-through Rates applicable to the
Adjustable
Rate Certificates for the relevant
Interest Accrual
Period, in the absence
of
manifest error, will be final and
binding.
33
<PAGE>
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) The Company may, in lieu of delivering the original of the
documents
set forth in Section 2.01(b)(I)(ii), (iii), (iv) and (v) and Section
(b)(II)(ii), (iv), (vii), (ix) and (x) (or copies thereof as permitted by
Section 2.01(b)) to the Trustee or the
Custodian or
Custodians,
deliver such
documents to the Master Servicer, and the Master Servicer shall hold such
documents in trust for the use and benefit of all present and future
Certificateholders until such time as is
set forth in the next sentence. Within
thirty Business Days following the earlier
of (i) the receipt of the original of
all of the documents or instruments set
forth in Section 2.01(b)(I)(ii), (iii),
(iv) and (v) and Section (b)(II)(ii), (iv), (vii), (ix) and (x) (or copies
thereof as permitted by such Section) for any Mortgage
Loan and (ii) a
written
request by the Trustee to deliver those
documents with respect
to any or all of
the Mortgage Loans then being held by the
Master Servicer,
the Master
Servicer
shall deliver a complete set of such
documents to the
Trustee or the Custodian
or Custodians that are the duly appointed
agent or agents of the Trustee.
The parties hereto
agree that it is not intended that any Mortgage Loan
be included in the Trust Fund that is either (i) a
"High-Cost
Home Loan" as
defined in the New Jersey Home Ownership
Act effective November 27, 2003, (ii) a
"High-Cost Home Loan" as defined in the New
Mexico Home Loan Protection Act
effective January 1, 2004, (iii) a "High
Cost Home Mortgage Loan" as defined in
the Massachusetts Predatory Home Loan Practices Act
effective November 7,
2004
or (iv) a "High-Cost Home Loan" as defined in the
Indiana Home Loan
Practices
Act, effective as of January 1, 2005.
(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 the Yield
Maintenance Agreement
has
been paid and the Trustee and the Trust Fund shall have no further payment
obligation thereunder and that such fixed
payment has been authorized hereby).
34
<PAGE>
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 15 years, in
the case of Group II Loans,
and 30 years, in the case of Group I Loans;
(iv) To the best of the
Company's knowledge,
if a Group I Loan is secured by
a Mortgaged Property with a Loan-to-Value Ratio at origination in
excess
of 80%, such Mortgage Loan is the subject of a Primary Insurance Policy
that insures
(a) at least 35% of
the Stated Principal
Balance of the
Mortgage Loan at
origination
if the Loan-to-Value Ratio is between
100.00% and 95.01%,
(b) at least 30% of the Stated Principal Balance of
the Mortgage Loan at origination if the Loan-to-Value Ratio is between
95.00% and 90.01%, (c) at least 25% of such balance if the
Loan-to-Value
Ratio is between
90.00% and 85.01% and (d) at least 12% of such balance
if the Loan-to-Value
Ratio is between 85.00% and 80.01% and, if a Group
II Loan is secured by a Mortgaged Property with a Loan-to-Value
Ratio at
origination in excess
of 80%, such
Mortgage Loan is the subject of a
Primary Insurance
Policy that insures (a) at least 30% of the
Stated
Principal
Balance of
the Mortgage Loan at origination if the
Loan-to-Value Ratio is
between 100.00% and 95.01%, (b) at least 25% of
the Stated Principal
Balance of the Mortgage Loan at origination if the
Loan-to-Value Ratio is
between 95.00% and
90.01%, (c) at least
12% of
such balance if the Loan-to-Value Ratio is between 90.00% and
85.01% and
(d) at least 6% 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;
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(vi) No more than 0.5% of the Group I Loans by
aggregate Stated Principal
Balance as of the
Cut-off Date are secured by Mortgaged Properties
located in any one zip
code area in Arizona,
and no more than 0.4%
of
the Group I Loans
by aggregate Stated Principal Balance as of the
Cut-off Date are secured by Mortgaged Properties located in any one
zip
code area outside Arizona; no more than 0.9% of the Sub-Group
I-1 Loans
by aggregate Stated Principal Balance as of the Cut-off Date are
secured
by Mortgaged
Properties located in any one zip code area in California,
and no more than 0.9% of the Sub-Group I-1 Loans by aggregate Stated
Principal Balance
as of the Cut-off Date are secured by Mortgaged
Properties located in any one zip code area outside California;
no more
than 0.7% of the
Sub-Group I-2
Loans by aggregate Stated Principal
Balance
