EXECUTION COPY
===============================================================================
RESIDENTIAL ACCREDIT LOANS, INC.,
Company,
RESIDENTIAL FUNDING CORPORATION,
Master Servicer,
and
DEUTSCHE BANK TRUST COMPANY AMERICAS,
Trustee
SERIES SUPPLEMENT,
DATED AS OF JULY 1, 2005,
TO
STANDARD TERMS OF
POOLING AND SERVICING AGREEMENT
dated as of August 1, 2004
Mortgage Asset-Backed Pass-Through Certificates
Series 2005-QS11
================================================================================
<PAGE>
<TABLE>
<CAPTION>
<S>
<C>
Article I
DEFINITIONS....................................................................4
Section 1.01.
Definitions..........................................................4
Section 1.02. Use of
Words and Phrases............................................20
Section 1.03.
Determination of
LIBOR..............................................21
Article II CONVEYANCE OF MORTGAGE
LOANS; ORIGINAL
ISSUANCE OF
CERTIFICATES...........................................................23
Section 2.01.
Conveyance of Mortgage
Loans.......................................23
Section 2.02.
Acceptance by Trustee.
(See Section 2.02 of the Standard Terms)...24
Section 2.03.
Representations, Warranties and Covenants of the
Master Servicer and the
Company......................................24
Section 2.04. Representations and Warranties of
Sellers............................27
Section 2.05. Execution and Authentication of Certificates/Issuance
of Certificates
Evidencing Interests in REMIC I
Certificates.........................27
Section 2.06. Conveyance of Uncertificated REMIC I and REMIC II
Regular Interests;
Acceptance by the
Trustee............................................27
Section 2.07. Issuance of Certificates Evidencing Interest in REMIC
II.............27
Section 2.08. Purposes and Powers of the Trust (See Section 2.08 of
the Standard
Terms)...............................................................27
Article III ADMINISTRATION AND SERVICING OF
MORTGAGE LOANS................................28
Article IV PAYMENTS TO
CERTIFICATEHOLDERS.................................................29
Section 4.01. Certificate Account. (See Section 4.01 of the
Standard Terms)........29
Section 4.02. Distributions.
......................................................29
Section 4.03. Statements to Certificateholders; Statements to the
Rating Agencies;
Exchange Act Reporting (See Section 4.03 of the Standard
Terms)......36
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).........36
Section 4.05. Allocation of Realized Losses.
......................................36
Section 4.06. Reports of Foreclosures and Abandonment of Mortgaged
Property. (See
Section 4.06 of the Standard
Terms)..................................38
Section 4.07. Optional Purchase of Defaulted Mortgage Loans.
(See Section 4.07
of
the Standard
Terms)..................................................38
Section 4.08. Surety Bond. (See Section 4.08 of the Standard
Terms)................38
Article V THE
CERTIFICATES................................................................39
Article VI THE COMPANY AND THE
MASTER SERVICER..........................................40
Article VII
DEFAULT......................................................................41
Article VIII CONCERNING THE
TRUSTEE.......................................................42
Article IX
TERMINATION..................................................................43
Article X REMIC
PROVISIONS............................................................44
Section 10.01.REMIC Administration. (See Section 10.01 of the Standard
Terms).....44
Section 10.02.Master Servicer; REMIC Administrator and Trustee
Indemnification.
(See Section 10.02 of the Standard
Terms)............................44
Section 10.03.Designation of
REMICs................................................44
Section 10.04.Distributions on the Uncertificated REMIC I and REMIC
II
Regular
Interests................................................... 44
Section 10.05.Compliance with Withholding
Requirements.............................46
Article XI MISCELLANEOUS
PROVISIONS......................................................47
Section 11.01.Amendment. (See Section 11.01 of the Standard
Terms)................47
Section 11.02.Recordation of Agreement; Counterparts. (See Section 11.02 of the
Standard
Terms)......................................................47
Section 11.03.Limitation on Rights of Certificateholders.
(See Section 11.03 of
the
Standard
Terms)......................................................47
Section
11.04.Governing Laws.
(See Section 11.04 of the Standard Terms)...........47
Section
11.05.Notices..............................................................47
Section 11.06.Required Notices to Rating Agency and Subservicer.
(See Section 11.06
of the Standard
Terms)...............................................48
Section 11.07.Severability of Provisions. (See Section 11.07 of the
Standard Terms)49
Section 11.08.Supplemental Provisions for Resecuritization.
(See Section 11.08
of
the Standard
Terms)..................................................49
Section 11.09.Allocation of Voting
Rights..........................................49
Section 11.10.No
Petition..........................................................49
</TABLE>
<PAGE>
EXHIBITS
Exhibit One:
Mortgage Loan Schedule
Exhibit Two:
Schedule of Discount Fractions
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
<PAGE>
This is a Series
Supplement, dated
as of July 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 two 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
CERTIFICATE
FITCH/
PASS-THROUGH PRINCIPAL
MATURITY ------------
MINIMUM
DESIGNATION RATE
BALANCE
FEATURES(1)
DATE
S&P
DENOMINATIONS(2)
<S>
<C>
<C>
<C>
<C> <C>
<C>
Class A-1 5.50%
$
36,149,700.00 Senior/Lockout/Fixed
July 25, 2035 AAA/AAA
$25,000.00
Rate
Class A-2 Adjustable
$145,078,000.00 Senior/Super
July 25, 2035 AAA/AAA
$25,000.00
Rate(3)
Senior/Floater/Adjustable
Rate
Class A-3 Adjustable
$
0.00
Senior/Interest
July 25, 2035 AAA/AAA
$2,000,000.00
Rate(3)
Only/Inverse
Floater/Adjustable
Rate
Class A-4 5.50%
$
13,000,000.00
Senior/Lockout/Fixed July 25, 2035
AAA/AAA
$25,000.00
Rate
Class A-5 5.50%
$
8,364,400.00
Senior/Senior
July 25, 2035 AAA/AAA
$25,000.00
Support/Lockout/Fixed
Rate
Class A-P 0.00%
$
369,201.92
Senior/Principal Only July 25, 2035 AAA/AAA
$25,000.00
Class A-V Variable $
0.00(5) Senior/Interest
July 25, 2035 AAA/AAA
$2,000,000.00
Rate(4)
Only/Variable Rate
Class R-I 5.50%
$
50.00
Senior/Residual/Fixed July 25, 2035 AAA/AAA
(6)
Rate
Class R-II 5.50%
$
50.00
Senior/Residual/Fixed July 25, 2035 AAA/AAA
(6)
Rate
Class M-1 5.50%
$
5,341,600.00
Mezzanine/Fixed Rate July 25, 2035
AA/NA
$25,000.00
Class M-2 5.50%
$
1,816,000.00
Mezzanine/Fixed Rate July 25, 2035
A/NA
$250,000.00
Class M-3 5.50%
$ 1,281,800.00 Mezzanine/Fixed
Rate July
25, 2035 BBB/NA
$250,000.00
Class B-1 5.50%
$
854,600.00
Subordinate/Fixed Rate
July 25, 2035 BB/NA
$250,000.00
Class B-2 5.50%
$ 747,800.00
Subordinate/Fixed Rate
July 25, 2035 B/NA
$250,000.00
Class B-3 5.50%
$
641,035.31
Subordinate/Fixed Rate
July 25, 2035 NA/NA
$250,000.00
</TABLE>
______________
(1) The
Certificates, other
than the Class B and Class R Certificates shall
be Book-Entry
Certificates. The
Class B Certificates
and the Class R
Certificates shall be delivered to the holders thereof in physical
form.
(2) The
Certificates, other than the Class R Certificates, shall be
issuable
in minimum dollar
denominations
as indicated above (by Certificate
Principal Balance or
Notional Amount, as applicable) and integral
multiples of $1 (or
$1,000 in the case of the Class B-1, Class B-2 and
Class B-3
Certificates) in excess thereof, except that one Certificate
of any of the Class
B-1, Class B-2 and
Class B-3 Certificates that
contain an uneven
multiple of $1,000 shall be issued in a denomination
equal to the sum of the related minimum denomination set forth
above and
such uneven multiple for such Class or the sum of such denomination and
an integral multiple of $1,000.
(3)
--------------------------------------------------------------------
Adjustable Initial
Formula
Maximum
Minimum
Rates:
-------------- ----------------
----------------------- -------- ---
Class A-2 3.84% LIBOR + 0.50%
Subject to the
0.50%
available funds cap
Class A-3 1.66% 5.00% - LIBOR
5.00%
0.00%
The Class A-3 Certificates do not have a
certificate principal
balance. For the
purpose of calculating interest payments,
interest on the Class A-3 Certificates
will accrue on a notional amount equal to
the certificate
principal balance
of
the Class A-2 Certificates immediately
prior to the related distribution date.
(4) The initial
Pass-Through Rate on the Class A-V Certificates is 0.4322%.
(5) The Class A-V
Certificates do not have a certificate principal balance.
For the purpose of calculating interest payments, interest on the Class
A-V Certificates will accrue on a notional amount equal to the
aggregate
Stated Principal
Balance of the
Mortgage Loans immediately prior to the
related Distribution Date.
(6) 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%.
2
<PAGE>
The Mortgage Loans have an aggregate principal balance as of the
Cut-off
Date of $213,644,237.23.
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.
Adjustable Rate
Certificates:
Any of the Class A-2
Certificates
and
Class A-3 Certificates.
Available Funds Cap: With respect to any Distribution Date on or before
the Distribution Date in December 2011 and
the Class A-2 Certificates, 5.50% per
annum, plus amounts, if any, paid pursuant to the Yield
Maintenance
Agreement,
expressed as a per annum rate. With respect to any Distribution Date after
December 2011 and the Class A-2
Certificates, 5.50% per annum.
Bankruptcy Amount:
As of any date of
determination prior to
the first
anniversary of the Cut-off Date, an amount
equal to the excess,
if any, of (A)
$100,000 over (B) the aggregate amount of
Bankruptcy Losses
allocated solely to
one or more specific Classes of Certificates in
accordance with Section 4.05 of
this Series Supplement. As of any date of determination on or after the
first
anniversary of the Cut-off Date, an amount
equal to the excess, if any, of
(1) the lesser of (a) the Bankruptcy Amount calculated as of the
close of business on the Business Day immediately preceding the most
recent anniversary of the Cut-off Date coinciding with or preceding
such
date of determination (or, if such date of determination is an
anniversary of the Cut-off Date, the Business Day immediately
preceding
such date of
determination)
(for purposes of this definition, the
"Relevant Anniversary") and (b) the greater of
(A) the greater of (i) the product of (x) an amount equal
to the largest
difference in the related Monthly Payment for any
Non-Primary Residence
Loan remaining in the Mortgage Pool (other
than Additional
Collateral
Loans)
which had an original
Loan-to-Value Ratio of
80% or greater that
would result if
the
Net Mortgage
Rate thereof was equal to the weighted average
(based on the principal balance of the Mortgage
Loans as of the
Relevant Anniversary)
of the Net Mortgage
Rates of all Mortgage
Loans as of the Relevant Anniversary less 1.25% per annum,
(y) a
number equal to the weighted average remaining term to maturity,
in months, of all
Non-Primary
Residence Loans
remaining in the
Mortgage Pool as of
the Relevant
Anniversary, and (z)
one plus
the quotient of the
number of all
Non-Primary Residence
Loans
remaining in the
Mortgage Pool divided by the total number of
Outstanding Mortgage
Loans in the Mortgage Pool as of the
Relevant Anniversary, and (ii) $50,000, and
(B) the greater of (i) 0.0006 times the aggregate
principal balance of
all the Mortgage Loans in the Mortgage Pool
as of the Relevant
Anniversary
having a Loan-to-Value Ratio
(other than Additional
Collateral
Loans) at origination
which
exceeds 75% and (ii) $100,000,
4
<PAGE>
over (2) the aggregate
amount of Bankruptcy Losses allocated
solely to one or more
specific Classes of
Certificates
in accordance
with Section 4.05 since the Relevant Anniversary.
The Bankruptcy
Amount may be further reduced by the Master Servicer
(including accelerating the manner in which
such coverage is reduced) provided
that prior to any such reduction, the Master Servicer shall (i)
obtain written
confirmation from each Rating Agency that such
reduction shall not reduce the
rating assigned to any Class of
Certificates
by such Rating
Agency below the
lower of the then-current rating or the rating assigned to
such Certificates as
of the Closing Date by such Rating Agency and (ii) provide a copy of such
written confirmation to the Trustee.
Certificate: Any Class
A, Class M, Class B or Class R Certificate.
Certificate Account:
The separate account or accounts created and
maintained pursuant to Section 4.01 of the Standard Terms, which shall be
entitled "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-QS11" and which must be an Eligible
Account.
Certificate Policy:
None.
Class A Certificate:
Any one of the Class
A-1, Class A-2,
Class A-3,
Class A-4, Class A-5, Class A-V or Class A-P
Certificates,
executed by the
Trustee and authenticated by the
Certificate Registrar substantially in the form
annexed to the Standard Terms as Exhibit
A.
Class A-1 Lockout
Amount: With respect
to any Distribution
Date, an
amount equal to the product of (i) the
Lockout Percentage for
that Distribution
Date, (ii) a fraction, the numerator of which is sum of
$10,110,000
and the
Certificate Principal Balance of the Class A-1
Certificates and the denominator
of which is the aggregate Certificate Principal Balance of all Classes of
Certificates (other than the Class A-P
Certificates)) and (iii) the aggregate of
the collections described in clauses (A), (B),
(C), (D) and (E) (net of amounts
set forth in clause (F)) of Section
4.02(a)(ii)(Y),
without application of
the
Senior Percentage or the Senior Accelerated
Distribution
Percentage;
provided,
however, that if the aggregate of the amounts set forth
in clauses (A),
(B),
(C), (D) and (E) (net of amounts set forth in clause (F)) of Section
4.02(a)(ii)(Y) is more than the balance of the
Available Distribution Amount
remaining after the Senior Interest Distribution Amount and the Class A-P
Principal Distribution Amount have been distributed, the Class A-1 Lockout
Amount shall be reduced by an amount equal
to the product of such difference and
the fraction described in clause (ii)
above.
Class A-4/A-5 Lockout Amount: With respect to any Distribution
Date, an
amount equal to the product of (i) the
Lockout Percentage for
that distribution
date, (ii) a fraction, the numerator of which the aggregate Certificate
Principal Balance of the Class A-4
Certificates and Class
A-5 Certificates and
the denominator of which is the aggregate
Certificate
Principal Balance of
all
classes of Certificates (other than the Class A-P
Certificates)) and
(iii) the
aggregate of the collections described in clauses (A),
(B), (C), (D) and (E)
(net of amounts set forth in clause (F)) of Section 4.02(a)(ii)(Y), without
application of the Senior Percentage or the Senior Accelerated Distribution
Percentage; provided, however, that if the
aggregate of the amounts set forth in
5
<PAGE>
clauses (A), (B), (C), (D) and (E) (net of amounts
set forth in clause (F)) of
Section 4.02(a)(ii)(Y) is more than the balance of the
Available
Distribution
Amount remaining after the Senior Interest
Distribution Amount and the Class A-P
Principal Distribution Amount have been
distributed, the Class
A-4/A-5 Lockout
Amount shall be reduced by an amount equal
to the product of such difference and
the fraction described in clause (ii)
above.
Class R Certificate:
Any one of the Class
R-I Certificates
and Class
R-II 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.
Closing Date: July 28,
2005.
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-QS11.
Cut-off Date: July 1,
2005.
Determination Date:
With respect to any
Distribution Date, the
second
Business Day prior to each Distribution
Date.
Discount Net Mortgage Rate: 5.50% 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
6
<PAGE>
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
lower of
the then-current rating or the rating assigned to
such Certificates as
of the
Closing Date by such Rating Agency).
Eligible Funds: On any
Distribution
Date, the excess,
if any, of the
Available Distribution Amount over the sum of (i) the aggregate amount of
Accrued Certificate Interest on the Senior Certificates, (ii) the Senior
Principal Distribution Amount (determined without regard to Section
4.02(a)(ii)(Y)(D) hereof), (iii) the Class A-P Principal
Distribution
Amount
(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 M, Class
B-1 and Class B-2 Certificates.
Floater Certificates:
The Class A-2 Certificates.
Fraud Loss Amount:
As of any date of
determination
after the Cut-off
Date, an amount equal to: (X) prior to the
first anniversary of the Cut-off Date
an amount equal to 2.00% of the aggregate
outstanding
principal balance of
all
of the Mortgage Loans as of the Cut-off
Date minus the aggregate amount of Fraud
Losses allocated solely to one or more specific Classes of Certificates in
accordance with Section 4.05 of this Series
Supplement since the Cut-off Date up
to such date of determination, (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 as of the most recent
anniversary of the
Cut-off Date and
(b) 2.00% of the aggregate outstanding principal balance of
all of the Mortgage
Loans as of the most recent anniversary of the Cut-off Date minus (2) the
aggregate amount of Fraud Losses allocated solely to one or more specific
Classes of Certificates in accordance with Section 4.05 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 as of the most
recent anniversary of the Cut-off Date and (b) 1.00% of the aggregate
outstanding principal balance of all of the
Mortgage Loans as of the most recent
anniversary of the Cut-off Date minus (2) the
aggregate amount of
Fraud Losses
allocated solely to one or more specific
Classes of
Certificates in accordance
with Section 4.05 since the most recent
anniversary
of the Cut-off Date up
to
such date of determination. On and after the fifth
anniversary of the
Cut-off
Date, the Fraud Loss Amount shall be
zero.
The Fraud Loss
Amount may be
further reduced by the Master Servicer
(including accelerating the manner in which
such coverage is reduced) provided
that prior to any such reduction, the Master Servicer shall (i)
obtain written
confirmation from each Rating Agency that such
reduction shall not reduce the
rating assigned to any Class of
Certificates
by such Rating
Agency below the
lower of the then-current rating or the rating assigned to
such Certificates as
of the Closing Date by such Rating Agency and (ii) provide a copy of such
written confirmation to the Trustee.
7
<PAGE>
Initial Monthly Payment Fund: $38,523 representing scheduled principal
amortization and interest at the Net Mortgage
Rate payable
during the August
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 A-3
Certificates,
$145,078,000. With respect to the Class A-V
Certificates
or Subclass
thereof
issued pursuant to Section 5.01(c) of the
Standard Terms, the aggregate Cut-off
Date Principal Balance of the Mortgage
Loans corresponding to the Uncertificated
REMIC I Regular Interests Z represented by
such Class or Subclass on such date.
Initial Subordinate
Class Percentage: With respect to each Class of
Subordinate Certificates, an amount which is equal to the initial aggregate
Certificate Principal Balance of such Class
of Subordinate
Certificates divided
by the aggregate Stated Principal Balance of all the Mortgage Loans
as of the
Cut-off Date as follows:
Class M-1: 2.50%
Class B-1: 0.40%
Class M-2: 0.85%
Class B-2: 0.35%
Class M-3: 0.60%
Class B-3: 0.30%
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. With
respect to the Adjustable Rate Certificates and any Distribution Date, the
period beginning on the 25th day of the
month preceding the month in which such
Distribution Date occurs and ending on the 24th day
of the month in which such
Distribution Date occurs.
Interest Only
Certificates:
Any one of the
Class A-3 or Class A-V
Certificates. The Interest Only Certificates
will have no Certificate Principal
Balance.
Inverse Floater Certificates: The Class A-3 Certificates.
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.
Lockout
Certificates:
The Class A-1, Class A-4, and Class A-5
Certificates.
Lockout Percentage:
For any Distribution Date occurring prior to the
Distribution Date in August 2010, 0%, and for
any Distribution Date thereafter,
as follows: 30% for any Distribution
Date on or after
August 2010 and prior to
August 2011; 40% for any Distribution
Date on or after
August 2011 and prior to
August 2012; 60% for any Distribution
Date on or after
August 2012 and prior to
August 2013; 80% for any Distribution
Date on or after
August 2013 and prior to
August 2014; and 100% for any Distribution
Date thereafter.
Maturity Date:
July 25, 2035, the Distribution Date immediately
following the latest scheduled maturity
date of any Mortgage Loan.
8
<PAGE>
Mortgage Loan Schedule: The list or lists of the Mortgage Loans
attached
hereto as Exhibit One (as amended
from time to time to
reflect the addition
of
Qualified Substitute Mortgage Loans), which list or lists shall set
forth the
following information as to each Mortgage
Loan:
(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 A-3 Certificates, an amount equal to the Certificate
Principal Balance of
the Class A-2 Certificates immediately prior to such date,
provided, however,
for federal income tax purposes,
as of any Distribution Date, with respect to
the Class A-3 Certificates, the equivalent of the foregoing,
expressed as the
Uncertificated Principal Balance of
Uncertificated REMIC I
Regular Interest W;
and (iii) with respect to any Class A-V
Certificates or
Subclass thereof issued
pursuant to Section 5.01(c) of the Standard Terms, the aggregate Stated
Principal Balance of the Mortgage
Loans corresponding to the Uncertificated
REMIC I Regular Interests Z represented
by such Class or
Subclass
immediately
prior to such date.
9
<PAGE>
Pass-Through Rate: With respect to the Senior Certificates (other than
the Adjustable Rate, Class A-V 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.
o
With respect to the
Class A-2 and the initial Interest Accrual
Period,
3.84% 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. For federal income tax purposes, the
Pass-Through Rate
described above will be subject to a
maximum
rate equal to 5.50%.
o
With respect
to the Class A-3 Certificates and the initial
Interest Accrual Period, 1.66% 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. For federal
income tax
purposes, the
Pass-Through Rate
described above will be subject to a
maximum
rate equal to 5.00%.
With respect to the
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 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
A-V Certificates and the initial Distribution Date the Pass-Through Rate is
equal to 0.4322% per annum. With respect to any Subclass of Class A-V
Certificates and any Distribution Date, a rate equal to the weighted
average,
expressed as a percentage, of the Pool Strip Rates of all Mortgage Loans
corresponding to the Uncertificated REMIC I Regular Interests Z
represented by
such Subclass as of the Due Date in the
related Due Period, weighted on the
basis of the respective Stated Principal Balances of such Mortgage Loans as
of
the day immediately preceding such Distribution Date (or with respect to the
initial Distribution Date, at the close of business on
the Cut-off Date).
The
Principal Only Certificates have no Pass-Through Rate and are not entitled to
Accrued Certificate Interest.
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;
(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
10
<PAGE>
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
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
11
<PAGE>
(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:
The prepayment assumption to be used for
determining the accrual of original issue discount and premium and market
discount on the 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 related Mortgage Loans in the first month of the life of such
Mortgage Loans and an additional
approximately 1.090909% 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 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, under the applicable
circumstances set forth below, the
respective percentages set forth below:
(i) For
any Distribution
Date prior to the Distribution Date in
August 2010 (unless
the Certificate
Principal Balances of the
Senior Certificates
(other than the Class A-P Certificates) have
been reduced to zero), 0%.
(ii) For any
Distribution
Date not discussed in clause (i) above
on
which any Class of Subordinate Certificates are outstanding:
(a) in the case of the Class of Subordinate Certificates
then outstanding
with the Highest
Priority and each other Class
of Subordinate
Certificates
for which the
related Prepayment
Distribution Trigger has been satisfied, a fraction, expressed
as
a percentage, the numerator of which is the Certificate
Principal
Balance of such
Class immediately prior to such date and the
denominator of
which is the sum of the Certificate Principal
Balances immediately
prior to such date of (1) the Class of
Subordinate
Certificates then
outstanding
with the Highest
Priority and (2) all other Classes of Subordinate Certificates
for which the respective Prepayment Distribution Triggers have
been satisfied; and
(b) in the
case of each other Class of Subordinate
Certificates for which the Prepayment Distribution Triggers have
not been satisfied, 0%; and
(iii)
Notwithstanding the
foregoing,
if the application of the
foregoing percentages
on any Distribution
Date as provided
in
Section 4.02
of this Series Supplement (determined without
regard to the proviso to the definition of "Subordinate
Principal Distribution
Amount") would result
in a distribution
in respect of principal of any Class or Classes of
Subordinate
Certificates in an amount greater than the remaining
Certificate
Principal Balance thereof (any such class, a "Maturing Class"),
then: (a) the Prepayment Distribution Percentage of each
Maturing Class shall be reduced to a level that, when applied
as
12
<PAGE>
described above, would exactly reduce the Certificate Principal
Balance of such Class to zero; (b) the Prepayment Distribution
Percentage of each other Class of Subordinate Certificates (any
such Class, a
"Non-Maturing Class")
shall be recalculated
in
accordance with the
provisions in paragraph (ii) above, as if
the Certificate
Principal Balance of each Maturing
Class had
been reduced
to zero (such
percentage
as recalculated, the
"Recalculated
Percentage");
(c) the total amount of the
reductions in the
Prepayment
Distribution
Percentages of the
Maturing Class
or Classes pursuant to clause (a) of this
sentence,
expressed as
an aggregate percentage, shall be
allocated among the Non-Maturing Classes in proportion to their
respective
Recalculated
Percentages (the
portion of such
aggregate reduction so
allocated to any Non-Maturing Class, the
"Adjustment
Percentage");
and (d) for purposes of such
Distribution Date,
the Prepayment
Distribution
Percentage of
each Non-Maturing
Class shall be equal to the sum of (1) the
Prepayment
Distribution
Percentage thereof,
calculated
in
accordance with the provisions in paragraph (ii) above as if
the
Certificate Principal
Balance of each
Maturing Class had not
been reduced
to zero, plus (2) the related Adjustment
Percentage.
Principal Only Certificates: Any one of the Class A-P
Certificates.
Record Date: With
respect to each
Distribution Date and
each Class of
Certificates (other than the Adjustable
Rate Certificates for so long as the
Adjustable Rate Certificates are in book-entry
form), the close of
business on
the last Business Day of the month preceding the month in which the
related
Distribution Date occurs. With respect to each Distribution Date and the
Adjustable Rate Certificates (so long as
they are Book-Entry Certificates), the
close of business on the Business Day prior
to such Distribution Date.
Related Classes:
As to any Uncertificated REMIC I Regular Interest,
those classes of Certificates identified as
"Related Classes of Certificates" to
such Uncertificated REMIC I Regular
Interest in the definition of Uncertificated
REMIC I Regular Interest.
REMIC
I: The segregated pool of assets (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
Mortgage Loans and the related Mortgage Files,
(ii) all
payments and
collections
in respect of the
Mortgage
Loans due after the
Cut-off Date (other than Monthly
Payments due in the month of the Cut-off Date) 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
Mortgage Loan and which has been
acquired for the
benefit of the Certificateholders by
foreclosure or deed in lieu of foreclosure,
13
<PAGE>
(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, and
(v) all
proceeds of clauses (i) through (iv) above.
REMIC I Certificates:
The Class R-I Certificates.
--------------------
REMIC II: The segregated pool of assets consisting of the
Uncertificated
REMIC I Regular Interests conveyed in trust to the Trustee for the
benefit of
the holders of each Class of Certificates (other than the Class R-I
Certificates) pursuant to Section 2.06,
with respect to which
a separate REMIC
election is to be made.
Senior Accelerated
Distribution
Percentage:
With
respect to any
Distribution Date occurring on or prior to the
60th Distribution
Date, 100%.
With respect to any Distribution Date thereafter and any such Loan
Group, if
applicable, as follows:
(i) for any
Distribution
Date after the 60th
Distribution
Date but on or
prior to the 72nd
Distribution Date,
the Senior
Percentage
for such
Distribution Date
plus 70% of the 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 Senior
Percentage
for such
Distribution Date
plus 60% of the 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 Senior
Percentage
for such
Distribution Date
plus 40% of the 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 Senior
Percentage for
such
Distribution Date
plus 20% of the Subordinate Percentage for such
Distribution Date; and
(v) for any
Distribution
Date thereafter,
the 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
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 Subordinate
Certificates, is less
than 50% or (Y) the outstanding principal balance
of Mortgage Loans
delinquent 60 days or more (including Mortgage Loans
14
<PAGE>
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 averaged
over the last six months, does not exceed 2% and (2)
Realized Losses on
the Mortgage
Loans 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 Subordinate Certificates or
(b)(1) the
outstanding
principal balance of Mortgage Loans
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
averaged over the
last six months,
does not exceed 4% and (2) Realized Losses on the
Mortgage Loans 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 Subordinate Certificates, and
(ii) that for any
Distribution Date on
which the Senior
Percentage is
greater than the Senior Percentage as of the Closing Date, the Senior
Accelerated Distribution Percentage for
such Distribution Date shall be 100%.
Notwithstanding the foregoing, upon the reduction of the
Certificate
Principal
Balances of the related Senior Certificates (other than the Class A-P
Certificates, if any) to zero, the related Senior Accelerated Distribution
Percentage shall thereafter be 0%.
Senior Certificate:
Any one of the
Class A Certificates or Class R
Certificates, executed by the Trustee and authenticated by the Certificate
Registrar substantially in the form annexed to the
Standard Terms as Exhibit A
and Exhibit D.
Senior Interest
Distribution Amount:
With respect to any
Distribution
Date, the aggregate amount of Accrued
Certificate Interest
to be distributed to
the Holders of the Senior Certificates for
that Distribution Date.
Senior Percentage: As of any Distribution Date, the lesser of 100%
and a
fraction, expressed as a percentage, the numerator of which is the
aggregate
Certificate Principal Balance of the Senior
Certificates (other
than the Class
A-P Certificates) immediately prior to such Distribution Date and the
denominator of which is the aggregate
Stated Principal Balance of all of the
Mortgage Loans (or related REO Properties) (other than the related
Discount
Fraction of each Discount Mortgage Loan) immediately prior
to such Distribution
Date.
Senior Principal
Distribution Amount:
With respect to any Distribution
Date, the lesser of (a) the balance of the Available Distribution Amount
remaining after the distribution of all amounts required to be distributed
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 on such
Distribution Date pursuant
to Sections 4.02(a)(ii)(Y), 4.02(a)(xvi)
and 4.02(a)(xvii).
15
<PAGE>
Senior Support Certificates: The Class A-5 Certificates.
Special Hazard Amount:
As of any Distribution
Date, an amount equal to
$3,769,400 minus the sum of (i) the aggregate
amount of Special
Hazard Losses
allocated solely to one or more specific
Classes of
Certificates in accordance
with Section 4.05 of this Series
Supplement and (ii)
the Adjustment Amount
(as
defined below) as most recently calculated.
For each anniversary
of the Cut-off
Date, the Adjustment Amount shall be equal to the
amount, if any, by
which the
amount calculated in accordance
with the preceding
sentence (without giving
effect to the deduction of the Adjustment
Amount for such
anniversary)
exceeds
the greater of (A) the greater of (i) the product of the Special Hazard
Percentage for such anniversary
multiplied by the
outstanding principal balance
of all the Mortgage Loans on the
Distribution Date
immediately
preceding such
anniversary and (ii) twice the outstanding principal balance of the Mortgage
Loan 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
on
the Distribution Date immediately preceding such anniversary
multiplied by a
fraction, the numerator of which is equal
to the aggregate outstanding principal
balance (as of the immediately preceding Distribution Date) of all of the
Mortgage Loans secured by Mortgaged Properties located in the State of
California divided by the aggregate
outstanding
principal balance (as of the
immediately preceding Distribution Date) of
all of the Mortgage Loans, expressed
as a percentage, and the denominator of which is equal to 20.74% (which
percentage is equal to the percentage of
Mortgage Loans by
aggregate
principal
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 secured by
a Mortgaged Property (or, with respect to a Cooperative Loan, the related
Cooperative Apartment) located in the State
of California.
The Special Hazard Amount may be further reduced by the Master Servicer
(including accelerating the manner in which
coverage is reduced)
provided that
prior to any such reduction, the Master Servicer shall (i) obtain written
confirmation from each Rating Agency that such
reduction shall not reduce the
rating assigned to any Class of
Certificates
by such Rating
Agency below the
lower of the then-current rating or the rating assigned to
such Certificates as
of the Closing Date by such Rating Agency and (ii) provide a copy of such
written confirmation to the Trustee.
Special Hazard
Percentage: 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
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
as of the
immediately
preceding Distribution Date.
16
<PAGE>
Subordinate
Principal
Distribution
Amount: With
respect to any
Distribution Date and each Class of
Subordinate Certificates, (a) the sum of (i)
the product of (x) the related Subordinate Class Percentage for such Class
and
(y) the aggregate of the amounts calculated (without giving effect to the
related Senior Percentages) for such Distribution Date under clauses (1), (2)
and (3) of Section 4.02(a)(ii)(Y)(A); (ii)
such Class's pro rata share, based on
the Certificate Principal Balance of each
Class of Subordinate Certificates then
outstanding, of the principal collections
described
in Section
4.02(a)(ii)(Y)(B)(b) (without giving effect to the Senior Accelerated
Distribution Percentage) to the extent such collections are not otherwise
distributed to the Senior Certificates; (iii) the product of (x) the related
Prepayment Distribution Percentage and (y) the aggregate of all Principal
Prepayments in Full received in the related
Prepayment
Period and
Curtailments
received in the preceding calendar month (other than the related Discount
Fraction of such Principal Prepayments in Full and
Curtailments with respect to
a Discount Mortgage Loan) to the extent not
payable to the Senior
Certificates;
(iv) if such Class is the Class of
Subordinate
Certificates
with the Highest
Priority, any Excess Subordinate Principal
Amount for such Distribution Date not
paid to the 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 Subordinate
Certificates;
minus
(b) the sum of (i) with respect to the
Class of Subordinate
Certificates
with
the Lowest Priority, any Excess Subordinate Principal Amount for such
Distribution Date; and (ii) the Capitalization Reimbursement Amount for such
Distribution Date, other than the related
Discount Fraction of any portion of
that amount related to each Discount
Mortgage Loan, multiplied by a fraction,
the numerator of which is the Subordinate
Principal Distribution Amount for such
Class of Subordinate Certificates, without
giving effect to this clause (b)(ii),
and the denominator of which is the sum of
the principal
distribution
amounts
for all Classes of Certificates
other than the Class
A-P Certificates,
without
giving effect to any reductions for the
Capitalization Reimbursement Amount.
Super Senior Certificates: The Class A-2 Certificates.
Super Senior Optimal
Percentage:
As to any Distribution Date on and
after the Credit Support Depletion Date, a
fraction, expressed as
a percentage,
the numerator of which is the Certificate
Principal Balance of
the Super Senior
Certificates immediately prior to that
Distribution Date and the denominator of
which is the aggregate Certificate
Principal Balance of the Senior Certificates,
other than the Class A-P Certificates, immediately prior to such Distribution
Date.
Super Senior
Optimal Principal Distribution Amount: As to any
Distribution Date on and after the Credit
Support Depletion Date, an amount
equal to the product of (a) the then
applicable Super Senior Optimal Percentage
and (b) the amounts described in Section
4.02(a)(ii)(Y).
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 II Regular Interest Z, 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 A-V Certificates.
17
<PAGE>
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
II Regular Interest Z,
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.
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).
18
<PAGE>
<TABLE>
<CAPTION>
-----------------------
--------------------------------- ------------------
--------------------
Uncertificated REMIC Related Classes of
Certificates
Pass-Through Rate Initial Principal
I Regular Interest
Balance
-----------------------
--------------------------------- ------------------
--------------------
-----------------------
--------------------------------- ------------------
--------------------
<S>
<C>
<C>
<C>
<C>
W
Class A-2, Class A-3
5.50%
$145,078,000.00
-----------------------
--------------------------------- ------------------
--------------------
-----------------------
--------------------------------- ------------------
--------------------
X
Class A-P
0.00%
$369,201.92
-----------------------
--------------------------------- ------------------
--------------------
-----------------------
--------------------------------- ------------------
--------------------
Y
Class A-1, Class A-4, Class
5.50%
$68,196,985.31
A-5, Class R-II, Class M-1,
Class M-2, Class M-3, Class
B-1, Class B-2, Class B-3
-----------------------
--------------------------------- ------------------
--------------------
</TABLE>
Uncertificated
REMIC I Regular Interests Z: Each of the 1,105
uncertificated partial undivided beneficial ownership interests in the Trust
Fund, numbered sequentially from 1 to 1,105, 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 1,105
uncertificated partial undivided beneficial ownership interests in REMIC II
numbered sequentially from 1 through 1,105, 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 II Regular Interests Z's pro rata share of the amount
distributed pursuant to Section
10.04(a).
Uncertificated REMIC
II Regular Interests
Distribution
Amount: With
respect to any Distribution Date, the sum of the amounts deemed to be
distributed on the Uncertificated REMIC I Regular Interests Z for such
Distribution Date pursuant to Section
10.04(a).
Underwriter: Bear,
Stearns & Co., Inc..
Yield Maintenance Agreement: The agreement dated as of the Closing
Date,
between the Trustee and the Yield
Maintenance Agreement
Provider, relating to
the Class A-2 Certificates, or any
replacement,
substitute, collateral or other
arrangement in lieu thereof.
19
<PAGE>
Yield Maintenance
Agreement Provider:
Bear, Stearns Financial Products
Inc., and its successors and assigns or any party to any replacement,
substitute, collateral or other arrangement
in lieu thereof.
Yield Maintenance
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.
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,
will equal the rate for one month United
States dollar deposits that appears on the Telerate Screen Page 3750 of the
Moneyline Telerate Capital Markets Report as
of 11:00 a.m., London time, on the
second LIBOR Business Day prior to the
first day of such Interest Accrual Period
("LIBOR Rate Adjustment Date"). "Telerate Screen Page 3750" means the
display
designated as page 3750 on the Telerate Service (or such other page as may
replace page 3750 on that service for the
purpose of displaying London interbank
offered rates of major banks). If such rate does not appear on such page (or
such other page as may replace that page on
that service, or if
such service is
no longer offered, any other service for
displaying LIBOR or comparable rates as
may be selected by the Trustee after
consultation with the Master Servicer), the
rate will be the Reference Bank Rate. The "Reference Bank Rate" will be
determined on the basis of the rates at which
deposits in U.S. Dollars are
offered by the reference banks (which shall be any three major
banks that are
engaged in transactions in the London
interbank market,
selected by the Trustee
after consultation with the Master Servicer) as of
11:00 a.m., London time, on
the day that is one LIBOR Business Day prior to the immediately preceding
Distribution Date to prime banks in the London
interbank market for a period of
one month in amounts approximately equal to the
aggregate Certificate Principal
Balance of the Adjustable Rate Certificates
then outstanding.
The Trustee will
request the principal London office of each of the
reference banks to provide a
quotation of its rate. If at least two such
quotations
are provided,
the rate
will be the arithmetic mean of the
quotations rounded up to the next multiple of
1/16%. If on such date fewer than two
quotations are provided as requested, the
rate will be the arithmetic mean of the rates quoted by one or
more major banks
in New York City, selected by the Trustee
after consultation with the Master
Servicer, as of 11:00 a.m., New York City time, on such date
for loans in U.S.
Dollars to leading European banks for a period of one month in amounts
approximately equal to the aggregate Certificate Principal Balance of the
20
<PAGE>
Adjustable Rate Certificates then outstanding. If no such quotations can be
obtained, the rate will be LIBOR for the
prior Distribution
Date, or, in the
case of the first LIBOR Rate Adjustment Date, 3.34% per annum; provided,
however, if, under the priorities described
above, LIBOR for a Distribution Date
would be based on LIBOR for the previous Distribution Date for the third
consecutive Distribution Date, the Trustee shall,
after consultation
with the
Master Servicer, select an alternative comparable
index (over which the Trustee
has no control), used for determining
one-month Eurodollar lending rates that is
calculated and published (or otherwise made
available) by an independent party.
"LIBOR Business Day" means any day other
than (i) a Saturday or a Sunday or (ii)
a day on which banking institutions in the
city of London,
England are required
or authorized by law to be closed.
The establishment
of LIBOR by the
Trustee on any LIBOR Rate Adjustment
Date and the Master Servicer's subsequent
calculation of the
Pass-Through Rates
applicable to each of the Adjustable Rate
Certificates for the relevant Interest
Accrual Period, in the absence of manifest
error, will be final and binding.
Promptly following
each LIBOR Rate
Adjustment
Date the Trustee
shall
supply the Master Servicer with the results of its
determination
of LIBOR on
such date. Furthermore, the Trustee will supply the
Pass-Through Rates on each
of the Adjustable Rate Certificates for the current and the immediately
preceding Interest Accrual Period via the
Trustee's internet website, which may
be obtained by telephoning the Trustee at
(800) 735-7777.
21
<PAGE>
ARTICLE II
<PAGE>
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 House Enrolled Act No.
1229, 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).
22
<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 30 years;
(iv) To the best of the Company's knowledge, except in the case of four
Mortgage Loans
representing
approximately
0.3% of the aggregate
principal balance of
the Mortgage Loans, if
a Mortgage Loan is secured
by a Mortgaged
Property with a
Loan-to-Value Ratio at
origination in
excess of 80%, such Mortgage Loan is the subject of a Primary
Insurance
Policy that insures (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%. To the best of
the
Company's knowledge,
each such Primary
Insurance Policy is in full
force and effect and the Trustee is entitled to the benefits
thereunder;
(v) The issuers of
the Primary Insurance
Policies are insurance
companies
whose claims-paying
abilities are
currently acceptable
to each Rating
Agency;
(vi) No more than 1.4% of
the Mortgage 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 0.6% of
the Mortgage
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;
(vii) The improvements upon the
Mortgaged Properties
are insured against loss
by fire and other
hazards as required by the Program Guide, including
flood insurance if
required under the National Flood Insurance Act of
1968, as amended. The
Mortgage requires the
Mortgagor to maintain such
casualty insurance at
the Mortgagor's
expense, and on the
Mortgagor's
failure to do so,
authorizes the holder
of the Mortgage to
obtain and
maintain such
insurance at the Mortgagor's expense and to seek
reimbursement therefor from the Mortgagor;
23
<PAGE>
(viii) Immediately prior to the assignment of the Mortgage Loans to the
Trustee, the Company
had good title to, and was the sole owner of, each
Mortgage Loan
free and clear of any pledge, lien, encumbrance or
security
interest (other
than rights to servicing and related
compensation) and such
assignment validly
transfers ownership of the
Mortgage Loans to the
Trustee free and clear of any pledge, lien,
encumbrance or security interest;
(ix) Approximately 69.27%
of the Mortgage Loans by aggregate Stated Principal
Balance as of the Cut-off Date were underwritten under a reduced loan
documentation program,
approximately
13.42% of the Mortgage
Loans by
aggregate Stated
Principal Balance as of the Cut-off Date were
underwritten under a no-stated income program, and approximately 13.36%
of the Mortgage Loans by aggregate Stated Principal Balance as of the
Cut-off Date were underwritten under a no income/no asset
program;
(x) Except with
respect to
approximately 17.35%
of the Mortgage
Loans by
aggregate Stated Principal Balance as of the Cut-off Date, the
Mortgagor
represented in its loan application with respect to the related
Mortgage
Loan that the Mortgaged Property would be owner-occupied;
(xi) None of the Mortgage
Loans is a Buy-Down Mortgage Loan;
(xii) Each Mortgage Loan constitutes a qualified mortgage under Section
860G(a)(3)(A) of
the Code and Treasury Regulations Section
1.860G-2(a)(1),
(2), (4), (5) and (6), without reliance on the
provisions of Treasury
Regulation Section
1.860G-2(a)(3)
or Treasury
Regulation Section
1.860G-2(f)(2)
or any other
provision that would
allow
a Mortgage Loan to be treated as a "qualified mortgage"
notwithstanding
its failure
to meet the requirements of Section
860G(a)(3)(A) of
the Code and Treasury Regulation
Section
1.860G-2(a)(1), (2), (4), (5) and (6);
(xiii) A policy of title insurance was effective as of the closing of each
Mortgage Loan and is
valid and binding
and remains in full force and
effect, unless the Mortgaged Properties are located in the State of
Iowa
and an attorney's
certificate
has been provided as described in the
Program Guide;
(xiv) None of the Mortgage Loans
is a Cooperative Loan;
(xv) With respect to each
Mortgage Loan originated under a "streamlined"
Mortgage Loan program
(through which no new or updated
appraisals of
Mortgaged Properties
are obtained in
connection with the
refinancing
thereof), the related
Seller has represented
that either (a) the value
of the related
Mortgaged Property as of the date the
Mortgage Loan was
originated was not less than the appraised value of such property
at the
time of origination of the refinanced Mortgage Loan or (b) the
Loan-to-Value Ratio of
the Mortgage Loan as of the date of origination
of the Mortgage Loan generally meets the Company's underwriting
guidelines;
24
<PAGE>
(xvi) Interest on each
Mortgage Loan is calculated on the basis of
a 360-day
year consisting of twelve 30-day months;
(xvii) None of the Mortgage Loans contain in the related Mortgage File a
Destroyed Mortgage Note;
(xviii) None of the Mortgage Loans has been
made to an
International
Borrower,
and no such Mortgagor is a member of a foreign diplomatic mission with
diplomatic rank;
(xix) No Mortgage Loan provides for payments that
are subject to reduction by
withholding taxes
levied by any foreign
(non-United States)
sovereign
government; and
(xx) None of the Mortgage
Loans is an Additional
Collateral Loan and none of
the Mortgage Loans is a Pledged Asset Loan.
It is understood and agreed that the
representations and warranties set forth in
this Section 2.03(b) shall survive delivery
of the respective
Mortgage Files to
the Trustee or any Custodian.
Upon discovery by any of the Company, the Master Servicer, the Trustee
or any Custodian of a breach of any of the
representations
and warranties set
forth in this Section 2.03(b) that materially and adversely affects the
interests of the Certificateholders in any Mortgage
Loan, the party discovering
such breach shall give prompt written
notice to the other parties (any Custodian
being so obligated under a Custodial
Agreement); provided,
however, that in the
event of a breach of the representation and warranty set forth in Section
2.03(b)(xii), the party discovering such breach shall give such notice
within
five days of discovery. Within 90 days of
its discovery or its receipt of notice
of breach, the Company shall either (i) cure such breach in all material
respects or (ii) purchase such Mortgage
Loan from the Trust Fund at the Purchase
Price and in the manner set forth in
Section 2.02;
provided that the Company
shall have the option to substitute a Qualified Substitute Mortgage Loan or
Loans for such Mortgage Loan if such substitution occurs within two years
following the Closing Date; provided that if the omission or
defect would cause
the Mortgage Loan to be other than a
"qualified mortgage"
as defined in Section
860G(a)(3) of the Code, any such cure or repurchase must occur within 90 days
from the date such breach was discovered. Any such substitution shall be
effected by the Company under the same terms and
conditions
as provided in
Section 2.04 for substitutions by Residential Funding. It is understood and
agreed that the obligation of the Company to cure
such breach or to so purchase
or substitute for any Mortgage Loan as to which
such a breach has occurred and
is continuing shall constitute the sole
remedy respecting such
breach available
to the Certificateholders or the Trustee on behalf of the
Certificateholders.
Notwithstanding the foregoing, the Company shall not be required to cure
breaches or purchase or substitute for Mortgage Loans as provided in this
Section 2.03(b) if the substance of the breach of a
representation
set forth
above also constitutes fraud in the
origination of the Mortgage Loan.
25
<PAGE>
Section 2.04. Representations and Warranties of Sellers.
(See Section 2.04
of
the Standard Terms)
Section 2.05. Execution and Authentication of Certificates/Issuance
of
Certificates Evidencing Interests in REMIC I Certificates.
The Trustee
acknowledges the assignment to it of the Mortgage Loans and
the delivery of the Mortgage Files to it, or any Custodian on its behalf,
subject to any exceptions noted, together
with the assignment to it of all other
assets included in the Trust Fund and/or
the applicable REMIC,
receipt of which
is hereby acknowledged. Concurrently with such delivery and in exchange
therefor, the Trustee, pursuant to the written request of
the Company executed
by an officer of the Company, has executed and caused to be
authenticated
and
delivered to or upon the order of the
Company the Class R-I Certificates in
authorized denominations which together with
the Uncertificated REMIC I Regular
Interests, evidence the beneficial interest
in REMIC I.
Section
2.06. Conveyance of
Uncertificated
REMIC I and REMIC
II
Regular Interests; Acceptance by the Trustee.
The Company, as of the Closing Date, and concurrently with the
execution
and delivery hereof, does hereby assign without
recourse all the
right, title
and interest of the Company in and to the Uncertificated REMIC I Regular
Interests to the Trustee for the benefit of the Holders of each Class of
Certificates (other than the Class R-I
Certificates). The
Trustee
acknowledges
receipt of the Uncertificated REMIC I Regular Interests and declares that it
holds and will hold the same in trust for
the exclusive
use and benefit of
all
present and future Holders of each Class of
Certificates
(other than the
Class
R-I Certificates). The rights of the Holders of each Class of Certificates
(other than the Class R-I Certificates) to receive distributions from the
proceeds of REMIC II in respect of such
Classes, and all
ownership interests of
the Holders of such Classes in such
distributions, shall be as set forth in this
Agreement.
Section 2.07. Issuance of Certificates
Evidencing Interest in REMIC II.
The Trustee
acknowledges the
assignment
to it of the
Uncertificated
REMIC I Regular Interests and, concurrently
therewith and in
exchange therefor,
pursuant to the written request of the Company executed by an officer of the
Company, the Trustee has executed and
caused to be authenticated and delivered
to or upon the order of the Company, all
Classes of Certificates (other than the
Class R-I Certificates) in authorized denominations, which evidence the
beneficial interest in the entire REMIC
II.
Section 2.08. Purposes and Powers of the Trust. (See Section 2.08 of the
Standard Terms).
26
<PAGE>
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
(SEE ARTICLE III OF THE STANDARD TERMS)
27
<PAGE>
ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS
Section 4.01. Certificate Account. (See Section 4.01 of the Standard
Terms)
--------------------------------------------------------------
Section 4.02. Distributions.
-------------
(a) On each
Distribution Date the
Master Servicer on behalf of the
Trustee (or the Paying Agent appointed by the Trustee) shall
distribute to the
Master Servicer, in the case of a distribution
pursuant to Section 4.02(a)(iii)
below, and to each Certificateholder of
record on the next preceding Record Date
(other than as provided in Section 9.01 of
the Standard
Terms respecting the
final distribution) either in immediately available funds (by wire transfer
or
otherwise) to the account of such
Certificateholder
at a bank or other
entity
having appropriate facilities therefor, if such Certificateholder has so
notified the Master Servicer or the Paying
Agent, as the case may be, or, if
such Certificateholder has not so notified the Master Servicer or the Paying
Agent by the Record Date, by check mailed to such Certificateholder at the
address of such Holder appearing in the Certificate Register such
Certificateholder's share (which share (A) with respect to each Class of
Certificates (other than any Subclass of the
Class A-V Certificates), shall be
based on the aggregate of the Percentage
Interests represented by Certificates
of the applicable Class held by such Holder or (B)
with respect to any Subclass
of the Class A-V Certificates, shall be
equal to the amount (if any) distributed
pursuant to Section 4.02(a)(i) below to each Holder of a Subclass
thereof) of
the following amounts, in the following order of priority (subject to the
provisions of Section 4.02(b), (c) and (e)
below), in each case to the extent of
the Available Distribution Amount:
(i)
to the Senior
Certificates (other
than the Class A-P
Certificates), on a pro rata basis based on Accrued Certificate
Interest
payable on such
Certificates with
respect to such
Distribution Date,
Accrued Certificate
Interest on such Classes of Certificates (or
Subclasses, if any, with respect to the Class A-V Certificates) for
such
Distribution Date
(provided that for the purpose of this Section
4.02(a)(i) the
Available Funds Cap shall be 5.50%),
plus any Accrued
Certificate
Interest thereon
remaining
unpaid from any previous
Distribution Date
except as provided in the last paragraph of this
Section 4.02(a); and
(ii) (X) to the Class
A-P Certificates, the Class A-P
Principal
Distribution Amount
(applied to reduce the Certificate
Principal Balance of such Senior Certificates); and
(Y) to the Senior
Certificates (other than the Class A-P,
Class A-3 and Class A-V Certificates), in the priorities and
amounts set
forth in Section
4.02(b) and (c), the sum of the following (applied to
reduce the Certificate
Principal Balances of such Senior Certificates,
as applicable):
(A) the Senior Percentage for such Distribution Date times the sum of the
following:
28
<PAGE>
(1) the principal
portion of each Monthly Payment due during the related Due
Period on each
Outstanding
Mortgage Loan (other than the related
Discount Fraction of
the principal portion of such payment with respect
to a Discount Mortgage Loan), whether or not received on or prior
to the
related Determination
Date, minus the principal portion of any Debt
Service Reduction
(other than the related Discount Fraction of the
principal portion of
such Debt Service
Reductions with respect to each
Discount Mortgage
Loan) which
together with other
Bankruptcy
Losses
exceeds the Bankruptcy Amount;
(2) the Stated
Principal Balance of any Mortgage Loan repurchased during the
preceding calendar
month (or deemed to have been so repurchased in
accordance with
Section 3.07(b) of the Standard Terms) pursuant to
Section 2.02,
2.03, 2.04 or 4.07 and the amount of any shortfall
deposited in the Custodial Account in connection with the
substitution
of a Deleted Mortgage
Loan pursuant to
Section 2.03 or 2.04 during the
preceding calendar
month (other than the related Discount Fraction of
such Stated Principal Balance or shortfall with respect to each
Discount
Mortgage Loan); and
(3) the principal
portion of all other unscheduled collections (other than
Principal Prepayments
in Full and
Curtailments and amounts received in
connection with a Cash Liquidation or REO Disposition of a Mortgage
Loan
described in
Section 4.02(a)(ii)(Y)(B) of this Series Supplement,
including without limitation Insurance Proceeds, Liquidation Proceeds
and REO Proceeds), including Subsequent Recoveries, received during the
preceding calendar
month (or deemed to have been so received in
accordance with
Section 3.07(b) of the
Standard Terms) to the extent
applied by the Master Servicer as recoveries of principal of the
related
Mortgage Loan pursuant to Section 3.14 of the Standard Terms (other
than
the related
Discount Fraction of the principal portion of such
unscheduled collections, with respect to each Discount Mortgage
Loan);
(B) with respect to each Mortgage Loan for which a Cash Liquidation
or a
REO Disposition occurred during the preceding
calendar month (or was
deemed to
have occurred during such period in accordance with Section 3.07(b) of the
Standard Terms) and did not result in any
Excess Special Hazard Losses, Excess
Fraud Losses, Excess Bankruptcy Losses or
Extraordinary Losses, an amount equal
to the lesser of (a) the Senior
Percentage for such
Distribution Date times the
Stated Principal Balance of such Mortgage Loan
(other than the related Discount
Fraction of such Stated Principal Balance, with respect to each Discount
Mortgage Loan) and (b) the Senior
Accelerated
Distribution
Percentage for such
Distribution Date times the related
unscheduled
collections (including
without
limitation Insurance Proceeds, Liquidation Proceeds and REO Proceeds) to
the
extent applied by the Master Servicer as recoveries of
principal of the related
Mortgage Loan pursuant to Section 3.14 of
the Standard Terms (in each case other
than the portion of such unscheduled collections, with respect to a Discount
Mortgage Loan, included in clause (C) of the
definition of Class A-P Principal
Distribution Amount);
29
<PAGE>
(C) the Senior Accelerated Distribution Percentage for such
Distribution
Date times the aggregate of all Principal
Prepayments
in Full received in
the
related Prepayment Period and Curtailments
received in the
preceding calendar
month (other than the related Discount
Fraction of such Principal Prepayments in
Full and Curtailments, with respect to each
Discount Mortgage Loan);
(D) any Excess Subordinate Principal Amount for such
Distribution Date;
and
(E) any amounts
described in subsection (ii)(Y), clauses (A), (B) and
(C) of this Section 4.02(a), as determined for any previous
Distribution Date,
which remain unpaid after application of
amounts previously distributed pursuant
to this clause (E) to the extent
that such amounts are not attributable to
Realized Losses which have been allocated
to the Subordinate Certificates; minus
(F) the Capitalization
Reimbursement Amount for such Distribution Date,
other than the related Discount Fraction of any portion of that
amount related
to each Discount Mortgage Loan, multiplied
by a fraction, the numerator of which
is the Senior Principal Distribution Amount, without giving effect to this
clause (F), and the denominator of which is the sum of the principal
distribution amounts for all Classes of
Certificates
other than the Class
A-P
Certificates, without giving effect to any
reductions
for the Capitalization
Reimbursement Amount;
(iii) if the
Certificate Principal
Balances of the
Subordinate
Certificates have not
been reduced to zero, to the Master Servicer or a
Sub-Servicer, by
remitting for deposit to the Custodial Account, to the
extent of and in reimbursement for any Advances or Sub-Servicer
Advances
previously made with
respect to any Mortgage Loan or REO Property which
remain unreimbursed in
whole or in part following the Cash Liquidation
or REO Disposition of such Mortgage Loan or REO Property, minus any
such
Advances that were made with respect to delinquencies that ultimately
constituted Excess
Special Hazard Losses,
Excess Fraud Losses,
Excess
Bankruptcy Losses or Extraordinary Losses;
(iv) to the Holders of
the Class M-1
Certificates, the
Accrued
Certificate
Interest thereon for such Distribution Date, plus any
Accrued Certificate
Interest thereon remaining unpaid from any previous
Distribution Date, except as provided below;
(v) to the Holders of the Class M-1 Certificates, an amount
equal
to (x) the Subordinate
Principal Distribution
Amount for such Class of
Certificates for such
Distribution
Date, minus (y) the amount of any
Class A-P Collection
Shortfalls for such Distribution Date or remaining
unpaid for all previous Distribution Dates, to the extent the amounts
available pursuant to clause (x) of Sections 4.02(a)(vii), (ix), (xi),
(xiii), (xiv)
and (xv) of this Series Supplement are insufficient
therefor, applied in
reduction of the Certificate Principal Balance of
the Class M-1 Certificates;
30
<PAGE>
(vi) to the Holders of
the Class M-2
Certificates, the
Accrued
Certificate Interest
thereon for such Distribution Date, plus any
Accrued Certificate
Interest thereon remaining unpaid from any previous
Distribution Date, except as provided below;
(vii) to the Holders
of the Class M-2
Certificates,
an amount
equal to (x) the
Subordinate Principal
Distribution
Amount for such
Class of Certificates for such Distribution Date, minus (y) the amount
of any Class A-P
Collection Shortfalls
for such Distribution
Date or
remaining unpaid for all previous Distribution Dates, to the extent
the
amounts available pursuant to clause (x) of Sections 4.02(a) (ix),
(xi),
(xiii), (xiv) and (xv) are insufficient therefor, applied in reduction
of the Certificate Principal Balance of the Class M-2
Certificates;
(viii) to the Holders of the Class M-3 Certificates, the Accrued
Certificate Interest
thereon for such Distribution Date, plus any
Accrued Certificate
Interest thereon remaining unpaid from any previous
Distribution Date, except as provided below;
(ix) to the Holders
of the Class M-3 Certificates, an amount
equal to (x) the
Subordinate Principal
Distribution
Amount for such
Class of Certificates for such Distribution Date minus (y) the
amount of
any Class A-P Collection Shortfalls for such Distribution Date or
remaining unpaid for all previous Distribution Dates, to the extent
the
amounts available
pursuant to clause (x) of Sections 4.02(a)(xi),
(xiii), (xiv) and (xv) are insufficient therefor, applied in reduction
of the Certificate Principal Balance of the Class M-3
Certificates;
(x) to the Holders of
the Class B-1
Certificates, the
Accrued
Certificate Interest
thereon for such Distribution Date, plus any
Accrued Certificate
Interest thereon remaining unpaid from any previous
Distribution Date, except as provided below;
(xi) to the Holders
of the Class B-1 Certificates, an amount
equal to (x) the
Subordinate Principal
Distribution
Amount for such
Class of Certificates for such Distribution Date minus (y) the
amount of
any Class A-P Collection Shortfalls for such Distribution Date or
remaining unpaid for all previous Distribution Dates, to the extent
the
amounts available
pursuant to clause (x) of Sections 4.02(a)(xiii),
(xiv) and (xv) are
insufficient therefor,
applied in reduction
of the
Certificate Principal Balance of the Class B-1 Certificates;
(xii) to the Holders of the Class B-2 Certificates, the Accrued
Certificate Interest
thereon for such Distribution Date, plus any
Accrued Certificate
Interest thereon remaining unpaid from any previous
Distribution Date, except as provided below;
(xiii) to the Holders
of the Class B-2
Certificates, an
amount
equal to (x) the
Subordinate Principal
Distribution
Amount for such
Class of Certificates for such Distribution Date minus (y) the
amount of
any Class A-P Collection Shortfalls for such Distribution Date or
remaining unpaid for all previous Distribution Dates, to the extent
the
amounts available
pursuant to clause (x)
of Sections
4.02(a)(xiv) and
(xv) are insufficient therefor, applied in reduction of the
Certificate
Principal Balance of the Class B-2 Certificates;
31
<PAGE>
(xiv) to the Holders
of the Class B-3
Certificates,
an amount
equal to (x) the Accrued Certificate Interest thereon for such
Distribution Date,
plus any Accrued Certificate Interest thereon
remaining unpaid from any previous Distribution Date, except as
provided
below, minus (y) the
amount of any Class A-P Collection Shortfalls for
such Distribution Date or remaining unpaid for all previous
Distribution
Dates, to the extent
the amounts
available pursuant to clause (x) of
Section 4.02(a)(xv) are insufficient therefor;
(xv) to the Holders
of the Class B-3 Certificates, an amount
equal to (x) the
Subordinate Principal
Distribution
Amount for such
Class of Certificates for such Distribution Date minus (y) the
amount of
any Class A-P Collection Shortfalls for such Distribution Date or
remaining unpaid
for all previous Distribution Dates applied in
reduction of
the Certificate Principal Balance of the Class B-3
Certificates;
(xvi) to the Senior Certificates, on a pro rata basis in
accordance with
their respective outstanding Certificate Principal
Balances, the portion,
if any, of the
Available Distribution Amount
remaining after the
foregoing distributions applied to reduce the
Certificate Principal
Balances of such Senior Certificates, but in no
event more than the aggregate of the outstanding Certificate Principal
Balances of each such Class of Senior Certificates, and thereafter, to
each Class of Subordinate Certificates then outstanding
beginning with
such Class with the
Highest Priority, any portion of the Available
Distribution Amount
remaining after the Senior Certificates have been
retired, applied to
reduce the Certificate
Principal Balance of each
such Class of
Subordinate
Certificates, but in
no event more than the
outstanding
Certificate Principal
Balance of each such Class of
Subordinate Certificates; and
(xvii) to the Class R-II Certificates, the balance, if any, of
the Available Distribution Amount.
Notwithstanding the foregoing, on any Distribution Date, with
respect to
the Class of Subordinate Certificates
outstanding on such Distribution Date with
the Lowest Priority, or in the event the
Subordinate
Certificates are no longer
outstanding, the Senior Certificates, Accrued Certificate Interest thereon
remaining unpaid from any previous
Distribution Date will
be distributable only
to the extent that (1) a shortfall in the amounts available to pay Accrued
Certificate Interest on any Class of
Certificates results from an interest rate
reduction in connection with a Servicing Modification, or (2) such unpaid
Accrued Certificate Interest was
attributable to interest shortfalls relating to
the failure of the Master Servicer to make any required Advance, or the
determination by the Master Servicer that any proposed Advance would be a
Nonrecoverable Advance with respect to the related
Mortgage Loan where such
Mortgage Loan has not yet been the subject of a Cash Liquidation or REO
Disposition or the related Liquidation Proceeds, Insurance Proceeds and REO
Proceeds have not yet been distributed to
the Certificateholders.
32
<PAGE>
(b) Distributions
of principal on the Senior Certificates on each
Distribution Date will be made as
follows:
(i) the Class A-P Principal Distribution Amount shall be
distributed
to the Class A-P Certificates, until the Certificate Principal Balance
thereof has been reduced to zero;
(ii) the Senior Principal Distribution Amount shall be distributed
to
the Class R-I
Certificates and Class R-II Certificates, on a pro rata
basis in accordance with their respective Certificate Principal
Balances, until the
Certificate
Principal Balance thereof have been
reduced to zero;
(iii) the lesser of (x) the balance of the Senior Principal
Distribution Amount remaining after the distributions, if any,
described
in clause (b)(ii) above and (y) the Class A-4/A-5 Lockout Amount,
shall
be distributed,
concurrently, to the
Class A-4 Certificates
and Class
A-5 Certificates,
on a pro rata basis in accordance with their
respective
Certificate Principal
Balances, until the Certificate
Principal Balances thereof have been reduced to zero;
(iv) the lesser of (x) the balance of the Senior Principal
Distribution Amount remaining after the distributions, if any,
described
in clauses
(b)(ii) and (b)(iii) above and (y) the Class A-1
Lockout
Amount, shall be
distributed to the Class A-1 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero;
(v) the balance of the Senior Principal Distribution Amount
remaining
after the distributions, if any, described in clauses
(b)(ii), (b)(iii)
and (b)(iv) above
shall be distributed
to the Class A-2
Certificates
until the Certificate
Principal Balance thereof has been reduced to
zero;
(vi) the balance of the Senior Principal Distribution Amount
remaining after the distributions, if any, described in clauses
(b)(ii),
(b)(iii), (b)(iv) and (b)(v) above shall be distributed to the
Class A-1
Certificates, without
regard to the Class A-1 Lockout Amount, until the
Certificate Principal Balance thereof has been reduced to zero;
and
(vii) the balance of the Senior Principal Distribution Amount
remaining after the distributions, if any, described in clauses
(b)(ii),
(b)(iii), (b)(iv),
(b)(v) and (b)(vi) above shall be distributed,
concurrently, to the
Class A-4 Certificates and Class A-5 Certificates,
on a pro rata basis in
accordance
with their
respective
Certificate
Principal Balances,
without regard to the Class A-4/A-5 Lockout Amount,
until the Certificate
Principal Balances
thereof have been
reduced to
zero.
(c) Notwithstanding
Section 4.02(b), on or after the Credit
Support
Depletion Date, an amount equal to the
Class A-P Principal
Distribution
Amount
will be distributed to the Class A-P
Certificates and then
the Senior Principal
Distribution Amount will be distributed to the remaining
Senior Certificates
(other than the Class A-P Certificates and
the Class A-V
Certificates) pro rata
in accordance with their respective
outstanding
Certificate Principal Balances;
provided, however, that until reduction of
the Certificate Principal Balance of
the Senior Support Certificates to zero, the
aggregate amount
distributable to
the Super Senior Certificates and Senior
Support Certificates
in respect of the
aggregate Accrued Certificate Interest
thereon and in respect of their aggregate
pro rata portion of the Senior Principal
Distribution Amount will be distributed
among such Senior Certificates in the following
priority: first, to the Super
Senior Certificates, up to an amount equal to the
Accrued Certificate Interest
on the Super Senior Certificates;
second, to the Super
Senior Certificates,
up
33
<PAGE>
to an amount equal to the Super Senior
Optimal Principal Distribution Amount, in
reduction of the Certificate Principal Balance thereof, until the Certificate
Principal Balance thereof has been reduced
to zero; third, to the Senior Support
Certificates, up to an amount equal to the
Accrued Certificate Interest thereon;
and fourth, to the Senior Support Certificates, the remainder, until the
Certificate Principal Balance thereof has
been reduced to zero.
(d) After the
reduction of the
Certificate Principal
Balances of the
Senior Certificates (other than the Class
A-P Certificates) to zero but prior to
the Credit Support Depletion Date, the
Senior Certificates (other than the Class
A-P Certificates) will be entitled to no further
distributions
of principal
thereon and the Available Distribution Amount will be
distributed solely to the
holders of the Class A-P, Class A-V and
Subordinate
Certificates, in each
case
as described herein.
(e) In addition to the
foregoing distributions, with respect to any
Subsequent Recoveries, the Master Servicer shall deposit such funds into
the
Custodial Account pursuant to Section 3.07(b)(iii) of the Standard
Terms. If,
after taking into account such Subsequent
Recoveries,
the amount of a
Realized
Loss is reduced, the amount of such Subsequent Recoveries will be applied to
increase the Certificate Principal Balance of the Class of Subordinate
Certificates with a Certificate Principal Balance greater than zero with the
highest payment priority to which Realized
Losses, other than
Excess Bankruptcy
Losses, Excess Fraud Losses, Excess Special Hazard Losses and Extraordinary
Losses, have been allocated, but not by more than the amount of
Realized Losses
previously allocated to that Class of
Certificates pursuant to Section 4.05. The
amount of any remaining Subsequent Recoveries will be applied to
increase from
zero the Certificate Principal Balance of the Class of
Certificates
with the
next lower payment priority, up to the amount of Realized
Losses previously
allocated to that Class of Certificates
pursuant to Section
4.05. Any remaining
Subsequent Recoveries will in turn be applied to increase from zero the
Certificate Principal Balance of the Class of
Certificates with the next lower
payment priority up to the amount of
Realized Losses
previously
allocated to
that Class of Certificates pursuant to Section 4.05, and so
on. Holders of such
Certificates will not be entitled to any payment in respect of Accrued
Certificate Interest on the amount of such
increases for any
Interest Accrual
Period preceding the Interest
Accrual Period that
relates to the
Distribution
Date on which such increase occurs. Any such increases shall be
applied to the
Certificate Principal Balance of each Certificate of such Class in
accordance
with its respective Percentage
Interest.
(f) On each
Distribution Date, the
Yield Maintenance
Payment will be
distributed to the Class A-2
Certificates.
(g) Each distribution with respect to a Book-Entry Certificate shall be
paid to the Depository, as Holder thereof, and the Depository shall be solely
responsible for crediting the amount of
such distribution to the accounts of its
Depository Participants in accordance with its normal procedures. Each
Depository Participant shall be responsible
for disbursing such distribution to
the Certificate Owners that it represents
and to each indirect
participating
brokerage firm (a "brokerage firm") for which it acts as agent.
Each brokerage
firm shall be responsible for disbursing
funds to the Certificate Owners that it
represents. None of the Trustee, the
Certificate Registrar,
the Company or the
Master Servicer shall have any
responsibility therefor.
34
<PAGE>
(h) Except as otherwise provided in Section 9.01 of the
Standard Terms,
if the Master Servicer anticipates that a
final distribution with respect to any
Class of Certificates will be made on the next
Distribution
Date, the Master
Servicer shall, no later than the
Determination Date in
the month of such final
distribution, notify the Trustee and the Trustee
shall, no later than two (2)
Business Days after such Determination
Date, mail on such date to each Holder of
such Class of Certificates a notice to the effect that: (i) the Trustee
anticipates that the final distribution with respect to such Class of
Certificates will be made on such Distribution Date but only upon
presentation
and surrender of such Certificates at the office of the
Trustee or as otherwise
specified therein, and (ii) no interest shall accrue
on such Certificates from
and after the end of the related Interest Accrual Period. In the event that
Certificateholders required to surrender their
Certificates pursuant to Section
9.01(c) of the Standard Terms do not surrender their Certificates for final
cancellation, the Trustee shall cause funds
distributable with
respect to such
Certificates to be withdrawn from the Certificate Account and credited to a
separate escrow account for the benefit of
such
Certificateholders as
provided
in Section 9.01(d) of the Standard
Terms.
Section 4.03. Statements to Certificateholders; Statements to the Rating
Agencies; Exchange
Act Reporting. (See Section 4.03 of the Standard
Terms)
Section 4.04. Distribution of Reports to the
Trustee and the Company; Advances
by the Master Servicer. (See Section 4.04 of the Standard
Terms)
Section 4.05. Allocation of Realized Losses.
Prior to each Distribution Date, the Master Servicer shall
determine the
total amount of Realized Losses, if any, that resulted from any Cash
Liquidation, Servicing Modification, Debt
Service Reduction, Deficient Valuation
or REO Disposition that occurred during the
related Prepayment Period or, in the
case of a Servicing Modification that constitutes a reduction of the
interest
rate on a Mortgage Loan, the amount of the
reduction in the interest portion of
the Monthly Payment due during the related Due Period. The amount of each
Realized Loss shall be evidenced by an Officers' Certificate. All Realized
Losses, other than Excess Special Hazard
Losses, Extraordinary
Losses, Excess
Bankruptcy Losses or Excess Fraud Losses,
shall be allocated as follows: first,
to the Class B-3 Certificates, until the Certificate Principal Balance thereof
has been reduced to zero; second, to the Class B-2 Certificates until the
Certificate Principal Balance thereof has been reduced
to zero; third, to
the
Class B-1 Certificates until the
Certificate Principal
Balance thereof has been
reduced to zero; fourth, to the Class M-3 Certificates until the Certificate
Principal Balance thereof has been reduced to zero; fifth, to the Class M-2
Certificates until the Certificate
Principal Balance thereof has been reduced to
zero; sixth, to the Class M-1 Certificates until the Certificate Principal
Balance thereof has been reduced to zero;
and, thereafter, if
any such Realized
Loss is on a Discount Mortgage Loan, to the Class A-P
Certificates in an amount
equal to the related Discount Fraction of the principal portion
of the Realized
Loss until the Certificate Principal Balance of the Class A-P
Certificates has
been reduced to zero, and the remainder of
such Realized Losses
on the Discount
Mortgage Loans and the entire amount of
such Realized Losses on the Non-Discount
Mortgage Loans shall be allocated among all
Senior Certificates
(other than the
Class A-P Certificates) on a pro rata basis, as described below; provided,
however, that after the Credit Support
Depletion Date, Realized Losses otherwise
35
<PAGE>
allocable to the Super Senior Certificates will be allocated to the Senior
Support Certificates until the Certificate Principal Balance of the Senior
Support Certificates has been reduced to zero.
The principal portion of any
Excess Special Hazard Losses, Excess Bankruptcy Losses, Excess
Fraud Losses and
Extraordinary Losses on the Discount
Mortgage Loans shall be allocated to
the
Class A-P Certificates in an amount equal to the related Discount Fraction
thereof and the remainder of the principal portion and the entire interest
portion of such Realized Losses on the Discount
Mortgage Loans and the entire
principal and interest portion of such
Realized Losses on Non-Discount Mortgage
Loans will be allocated among the Senior
Certificates (other
than the Class A-P
Certificates) and the Subordinate Certificates, on a pro rata basis, as
described below; provided, however, that such Realized Losses otherwise
allocable to the Super Senior Certificates will be allocated to the Senior
Support Certificates until the Certificate Principal Balance of the Senior
Support Certificates is reduced to
zero.
As used herein, an
allocation of a
Realized Loss on a "pro rata basis"
among two or more specified Classes of
Certificates means an allocation on a pro
rata basis, among the various Classes so specified, to each such Class of
Certificates, on the basis of their then outstanding Certificate Principal
Balances prior to giving effect to
distributions to be made on such Distribution
Date in the case of the principal portion of a Realized Loss or based on the
Accrued Certificate Interest thereon payable on such
Distribution Date (without
regard to any Compensating Interest for such Distribution
Date) in the case
of
an interest portion of a Realized Loss. Except as provided in the following
sentence, any allocation of the principal
portion of Realized Losses (other than
Debt Service Reductions) to a Class of
Certificates
shall be made by
reducing
the Certificate Principal Balance thereof by the amount so
allocated, which
allocation shall be deemed to have occurred
on such Distribution Date; provided
that no such reduction shall reduce the
aggregate Certificate
Principal Balance
of the Certificates below the aggregate
Stated Principal Balance of the Mortgage
Loans. Any allocation of the principal
portion of Realized
Losses (other than
Debt Service Reductions) to the Subordinate
Certificates then
outstanding with
the Lowest Priority shall be made by
operation of the definition of "Certificate
Principal Balance" and by operation of the provisions of Section 4.02(a).
Allocations of the interest portions of
Realized Losses (other than any interest
rate reduction resulting from a Servicing Modification) shall be made in
proportion to the amount of Accrued
Certificate Interest and by operation of the
definition of "Accrued Certificate
Interest" and by
operation of the provisions
of Section 4.02(a). Allocations of the interest portion of a Realized Loss
resulting from an interest rate reduction in connection with a Servicing
Modification shall be made by operation of the
provisions of Section
4.02(a).
Allocations of the principal portion of
Debt Service Reductions shall be made by
operation of the provisions of Section 4.02(a). All Realized Losses and all
36
<PAGE>
other losses allocated to a Class of
Certificates
hereunder will be
allocated
among the Certificates of such Class in
proportion to the Percentage Interests
evidenced thereby; provided that if any
Subclasses of the Class A-V Certificates
have been issued pursuant to Section 5.01(c) of the Standard Terms, such
Realized Losses and other losses allocated
to the Class A-V
Certificates shall
be allocated among such Subclasses in proportion to the
respective amounts
of
Accrued Certificate Interest payable on such
Distribution Date that would have
resulted absent such reductions.
Section 4.06. Reports of Foreclosures
and Abandonment of Mortgaged
Property.
(See Section 4.06 of the Standard Terms)
Section 4.07. Optional Purchase of Defaulted
Mortgage Loans. (See
Section 4.07
of the Standard Terms)
Section 4.08. Surety Bond. (See Section 4.08 of
the Standard Terms)
Section 4.09. Reserve Fund
(a) On or before the Closing Date, the Trustee shall establish a
Reserve
Fund on behalf of the Holders of the Class
A-2 Certificates.
The Reserve
Fund
must be an Eligible Account. The Reserve Fund shall be entitled
"Reserve Fund,
Deutsche Bank Trust Company Americas as Trustee for the
benefit of holders of
Residential Accredit Loans, Inc., Mortgage Asset-Backed Pass-Through
Certificates, Series 2005-QS11". The Trustee shall demand payment
of all money
payable by the Yield Maintenance
Agreement Provider
under the Yield Maintenance
Agreement. The Trustee shall deposit in the
Reserve Fund all payments received
by it from the Yield Maintenance Agreement Provider pursuant to the Yield
Maintenance Agreement. On each Distribution Date, the Trustee shall remit
amounts received by it from the Yield Maintenance Agreement Provider to the
Holders of the Class A-2 Certificates in the manner
provided in Section 4.02(f)
as it is directed by the Master
Servicer.
(b) The Reserve Fund is an "outside reserve fund" within the meaning
of
Treasury Regulation ss.1.860G-2(h) and shall be an
asset of the Trust Fund but
not an asset of any 2005-QS11 REMIC. The
Trustee on behalf of the Trust shall be
the nominal owner of the Reserve
Fund. Bear, Stearns & Co. Inc.
shall be the
beneficial owner of the Reserve Fund, subject to the power of the
Trustee to
distribute amounts under Section 4.02(f).
Amounts in the Reserve
Fund shall be
held uninvested in a trust account of the
Trustee with no liability for interest
or other compensation thereon.
37
<PAGE>
ARTICLE V
THE CERTIFICATES
Section 5.01. The Certificates.
(a) (See Section 5.01(a) of the Standard Terms)
(b) Except
as provided below, registration of Book-Entry
Certificates may not be transferred by the
Trustee except to another Depository
that agrees to hold such Certificates for
the respective Certificate Owners with
Ownership Interests therein. The Holders of the Book-Entry
Certificates shall
hold their respective Ownership Interests in and to each of such
Certificates
through the book-entry facilities of the Depository and, except as provided
below, shall not be entitled to Definitive Certificates in respect of such
Ownership Interests. All transfers by Certificate
Owners of their
respective
Ownership Interests in the Book-Entry
Certificates shall be
made in accordance
with the procedures established by the Depository
Participant or brokerage firm
representing such Certificate Owner. Each
Depository Participant
shall transfer
the Ownership Interests only in the Book-Entry Certificates of Certificate
Owners it represents or of brokerage firms for which it acts as agent in
accordance with the Depository's normal
procedures.
The &nbs
