Common use of Designation of Interests in REMICs Clause in Contracts

Designation of Interests in REMICs. (a) The Trustee shall elect that each of REMIC I, REMIC II and REMIC III shall be treated as a REMIC under Section 860D of the Code. Any inconsistencies or ambiguities in this Agreement or in the administration of this Agreement shall be resolved in a manner that preserves the validity of such REMIC elections. The assets of REMIC I shall include the Mortgage Loans, the accounts (other than the Net WAC Fund), any REO Property, and any proceeds of the foregoing. The REMIC I Regular Interests (as defined below) shall constitute the assets of REMIC II. The REMIC II Regular Interests shall constitute the assets of REMIC III. (1) The following table sets forth characteristics of the Certificates, each of which, except for the Class R Certificates, is hereby designated as a "regular interest" in the REMIC III: ------------------------------ ------------------------------------ ------------------------------------------- Original Certificate Principal Pass-Through Balance Rate ------------------------------ ------------------------------------ ------------------------------------------- Class A-1 $376,450,000 (1) ------------------------------ ------------------------------------ ------------------------------------------- Class A-2 $376,450,000 (1) ------------------------------ ------------------------------------ ------------------------------------------- Class M-1 $68,800,000 (1) ------------------------------ ------------------------------------ ------------------------------------------- Class M-2 $50,500,000 (1) ------------------------------ ------------------------------------ ------------------------------------------- Class B $46,003,566 (1) ------------------------------ ------------------------------------ ------------------------------------------- Class BIO (2) 3.50% ------------------------------ ------------------------------------ ------------------------------------------- Class X (3) (4) ------------------------------ ------------------------------------ ------------------------------------------- Class P $100 (5) ------------------------------ ------------------------------------ ------------------------------------------- Class R (6) ------------------------------ ------------------------------------ ------------------------------------------- (1) The lesser of the related Formula Rate and the Adjusted Net WAC. Any entitlement to Net WAC Carryover Amounts will not be an obligation of any REMIC created hereunder. (2) The Class BIO Certificates will be entitled to 100% of the interest distributions in respect of the Class IT-BIO Interest. (3) The Class X Certificates will have a notional principal balance equal to the aggregate principal balance of the Mortgage Loans. (4) The Pass-Through Rate in respect of the Class X Certificates will be the excess of: (i) the Adjusted Net WAC over (ii) the product of: (A) two and (B) the weighted average Pass-Through Rate of the REMIC II Interests, where the Intermediate REMIC Accrual Class is subject to a cap equal to zero and each Intermediate REMIC Accretion Directed Classes is subject to a cap equal to the Pass-Through Rate on its Corresponding Class. (5) The Class P Certificates will not be entitled to payments of interest. The Trustee will treat the rights of the Class P Certificates to receive Prepayment Charges as the beneficial ownership of the interests in a grantor trust and not as an obligation of any REMIC created hereunder, for federal income tax purposes. (6) The Class R Certificates will represent the beneficial ownership of the R-1, R-2 and R-3 Interests, which will represent the sole class of residual interest in each of REMIC I, REMIC II, and REMIC III. (2) The REMIC II Interests, each of which (expect for the Class R-2 Interests) is hereby designated a regular interest in REMIC 2, shall have the following principal balances, pass-through rates and Corresponding Classes of Certificates in the manner set forth in the following table: (1) 1 2 Corresponding Class Adjusted Net WAC A-1 balance ---------------------------- ----------------------------- ------------------------- ---------------------------- IT-A-2 (1) 1/2 Corresponding Class Adjusted Net WAC A-2 balance ---------------------------- ----------------------------- ------------------------- ---------------------------- IT-M-1 (1) 1 2 Corresponding Class Adjusted Net WAC M-1 balance ---------------------------- ----------------------------- ------------------------- ---------------------------- IT-M-2 (1) 1/2 Corresponding Class Adjusted Net WAC M-2 balance ---------------------------- ----------------------------- ------------------------- ---------------------------- IT-B (1) 1/2 Corresponding Class Adjusted Net WAC B balance ---------------------------- ----------------------------- ------------------------- ---------------------------- IT-Accrual Interest 1/2 Pool Principal Balance Adjusted Net WAC N/A plus1/2Initial Overcollateralized Amount less $100 ---------------------------- ----------------------------- ------------------------- ---------------------------- IT-BIO (2) 3.50% N/A ---------------------------- ----------------------------- ------------------------- ---------------------------- IT-P (3) N/A ---------------------------- ----------------------------- ------------------------- ---------------------------- R-2 N/A ▇/▇ ▇/▇ ---------------------------- ----------------------------- ------------------------- ---------------------------- ------------------ (1) Intermediate REMIC Accretion Directed Class. (2) On each of the first 30 Distribution Dates, the Class IT-BIO Interest will have a notional balance equal to the principal balance of the LT-BIO Interest. For each Distribution Date thereafter, its notional balance will equal $0. (3) The Class IT-P Interests will not be entitled to payments of interest. On each Distribution Date, 50% of the increase in the Overcollateralized Amount will be payable as a reduction of the principal balances of the Intermediate REMIC Accretion Directed Classes (each such Class will be reduced by an amount equal to 50% of any increase in the Overcollateralized Amount that is attributable to a reduction in the principal balance of its Corresponding Class) and will be accrued and added to the principal balance of the Intermediate REMIC Accrual Class. On each Distribution Date, the increase in the principal balance of the Intermediate REMIC Accrual Class may not exceed interest accruals for such Distribution Date for the Intermediate REMIC Accrual Class. In the event that: (i) 50% of the increase in the Overcollateralized Amount exceeds (ii) interest accruals on the Intermediate REMIC Accrual Class for such Distribution Date, the excess for such Distribution Date (accumulated with all such excesses for all prior Distribution Dates) will be added to any increase in the Overcollateralized Amount for purposes of determining the amount of interest accrual on the Intermediate REMIC Accrual Class payable as principal on the Intermediate REMIC Accretion Directed Class on the next Distribution Date pursuant to the first sentence of this paragraph. All payments of scheduled principal and prepayments of principal generated by the Mortgage Loans shall be allocated 50% to the Intermediate REMIC Accrual Class, and 50% to the Intermediate REMIC Accretion Directed Classes (principal payments shall be allocated among such Intermediate REMIC Accretion Directed Classes in an amount equal to 50% of the principal amounts allocated to their respective Corresponding Classes), until paid in full. Notwithstanding the above, principal payments allocated to the Class X Certificates that result in the reduction in the Overcollateralized Amount shall be allocated to the Intermediate REMIC Accrual Class (until paid in full). Realized losses shall be applied so that after all distributions have been made on each Distribution Date (i) the principal balances of each of the Intermediate REMIC Accretion Directed Class is equal to 50% of the principal balance of its respective Corresponding Class, and (ii) the Intermediate REMIC Accrual Class is equal to 50% of the aggregate principal balance of the Mortgage Pool plus 50% of the Overcollateralized Amount. (3) The Subsidiary REMIC Regular Interests shall have the following principal balances, pass-through rates and Corresponding Classes of Certificates in the manner set forth in the following table: ------------------------ ----------------------------- ---------------------------- ---------------------------- Corresponding REMIC Initial Interest Class of Master Interests Balance Rate REMIC Interest ------------------------ ----------------------------- ---------------------------- ---------------------------- LT-A (Pool Principal Balance) (1) N/A less $82,857,300 ------------------------ ----------------------------- ---------------------------- ---------------------------- LT-BIO $82,857,200 (1) N/A ------------------------ ----------------------------- ---------------------------- ---------------------------- LT-P $100 (2) N/A ------------------------ ----------------------------- ---------------------------- ---------------------------- ---------------------------------------------------------------------------------------------------------------- ---------------------------------------------------------------------------------------------------------------- (1) Weighted average of the Net Loan Rates of the Mortgage Loans. (2) The Class LT-P Interests will not be entitled to payments of interest. On each Distribution Date, all Realized Losses, prepayments and payments of scheduled principal will be allocated to Class LT-A1 until paid in full or eliminated by such losses, and all additional Realized losses, prepayments and payments of scheduled principal will be allocated to Class LT-BIO.

Designation of Interests in REMICs. (a) The Trustee shall elect that each of REMIC I, REMIC II and REMIC III shall be treated as a REMIC under Section 860D of the Code. Any inconsistencies or ambiguities in this Agreement or in the administration of this Agreement shall be resolved in a manner that preserves the validity of such REMIC elections. The assets of REMIC I shall include the Mortgage Loans, the accounts (other than the Net WAC Fund), any REO Property, and any proceeds of the foregoing. The REMIC I Regular Interests (as defined below) shall constitute the assets of REMIC II. The REMIC II Regular Interests shall constitute the assets of REMIC III. (1) The following table sets forth characteristics of the Certificates, each of which, except for the Class R Certificates, is hereby designated as a "regular interest" in the REMIC III: ------------------------------ ------------------------------------ ------------------------------------------- ----------------------------------------------------------------------- Original Certificate Principal Pass-Through Balance Rate ------------------------------ ------------------------------------ ------------------------------------------- ----------------------------------------------------------------------- Class A-1 $376,450,000 138,811,000 (1) ------------------------------ ------------------------------------ ------------------------------------------- ----------------------------------------------------------------------- Class A-2 $376,450,000 207,907,000 (1) ------------------------------ ------------------------------------ ------------------------------------------- ----------------------------------------------------------------------- Class A-IO (2) 4.50% ----------------------------------------------------------------------- Class M-1 $68,800,000 29,154,000 (1) ------------------------------ ------------------------------------ ------------------------------------------- ----------------------------------------------------------------------- Class M-2 $50,500,000 16,660,000 (1) ------------------------------ ------------------------------------ ------------------------------------------- ----------------------------------------------------------------------- Class B $46,003,566 45,814,000 (1) ------------------------------ ------------------------------------ ------------------------------------------- Class BIO (2) 3.50% ------------------------------ ------------------------------------ ------------------------------------------- ----------------------------------------------------------------------- Class X (3) (4) ------------------------------ ------------------------------------ ------------------------------------------- ----------------------------------------------------------------------- Class P $100 (5) ------------------------------ ------------------------------------ ------------------------------------------- ----------------------------------------------------------------------- Class R (6) ------------------------------ ------------------------------------ -------------------------------------------N/A N/A ----------------------------------------------------------------------- (1) The lesser of the related Formula Rate and the Adjusted Net WAC. Any entitlement to Net WAC Carryover Amounts will not be an obligation of any REMIC created hereunder. (2) The Class BIO A-IO Certificates will be entitled to 100% of the interest distributions in respect of the Class IT-BIO A-IO Interest. (3) The Class X Certificates will have be a notional principal balance equal to the aggregate principal balance Stated Principal Balance of the Mortgage Loans. (4) The Pass-Through Rate in respect of the Class X Certificates will be the excess of: (i) the Adjusted Net WAC over (ii) the product of: (A) two and (B) the weighted average Pass-Through Rate of the REMIC II Interests, where the Intermediate REMIC Accrual Class is subject to a cap equal to zero and each Intermediate REMIC Accretion Directed Classes is subject to a cap equal to the Pass-Through Rate on its Corresponding Class. (5) The Class P Certificates will not be entitled to payments of interest. The Trustee will treat the rights of the Class P Certificates to receive Prepayment Charges as the beneficial ownership a class of the regular interests in a grantor trust and not as an obligation of any REMIC created hereunder, for federal income tax purposesIII. (6) The Class R Certificates will represent the beneficial ownership of the R-1, R-2 and R-3 Interests, which will represent the sole class of residual interest in each of REMIC I, REMIC II, and REMIC III. (2) The REMIC II Interests, each of which (expect for the Class R-2 Interests) is hereby designated a regular interest in REMIC 2II, shall have the following principal balances, pass-through rates and Corresponding Classes of Certificates in the manner set forth in the following table: (1) 1 2 Corresponding Class Adjusted Net WAC A-1 balance ---------------------------- ----------------------------- ------------------------- ---------------------------- -------------------------------------------------------------------------------------------------------- IT-A-2 (1) 1/2 Corresponding Class Adjusted Net WAC A-2 balance ---------------------------- ----------------------------- ------------------------- ---------------------------- -------------------------------------------------------------------------------------------------------- IT-M-1 (1) 1 2 Corresponding Class Adjusted Net WAC M-1 balance ---------------------------- ----------------------------- ------------------------- ---------------------------- -------------------------------------------------------------------------------------------------------- IT-M-2 (1) 1/2 Corresponding Class Adjusted Net WAC M-2 balance ---------------------------- ----------------------------- ------------------------- ---------------------------- -------------------------------------------------------------------------------------------------------- IT-B (1) 1/2 Corresponding Class Adjusted Net WAC B balance ---------------------------- ----------------------------- ------------------------- ---------------------------- -------------------------------------------------------------------------------------------------------- IT-Accrual Interest 1/2 Pool Principal Balance Adjusted Net WAC N/A plus1/2Initial plus 1/2 Initial Overcollateralized Amount less $100 ---------------------------- ----------------------------- ------------------------- ---------------------------- -------------------------------------------------------------------------------------------------------- IT-BIO A-IO (2) 3.504.50% N/A ---------------------------- ----------------------------- ------------------------- ---------------------------- -------------------------------------------------------------------------------------------------------- IT-P $100 (3) N/A ---------------------------- ----------------------------- ------------------------- ---------------------------- -------------------------------------------------------------------------------------------------------- R-2 N/A ▇/▇ ▇/▇ ---------------------------- ----------------------------- ------------------------- ---------------------------- -------------------------------------------------------------------------------------------------------------------------- ------------- (1) Intermediate REMIC Accretion Directed Class. (2) On each of the first 30 24 Distribution Dates, the Class IT-BIO A-IO Interest will have a notional balance equal to the principal balance of the LT-BIO A-IO Interest. For each Distribution Date thereafter, its notional balance will equal $0. (3) The Class IT-P Interests will not be entitled to payments of interest. On each Distribution Date, 50% of the increase in the Overcollateralized Amount will be payable as a reduction of the principal balances of the Intermediate REMIC Accretion Directed Classes (each such Class will be reduced by an amount equal to 50% of any increase in the Overcollateralized Amount that is attributable to a reduction in the principal balance of its Corresponding Class) and will be accrued and added to the principal balance of the Intermediate REMIC Accrual Class. On each Distribution Date, the increase in the principal balance of the Intermediate REMIC Accrual Class may not exceed interest accruals for such Distribution Date for the Intermediate REMIC Accrual Class. In the event that: (i) 50% of the increase in the Overcollateralized Amount exceeds (ii) interest accruals on the Intermediate REMIC Accrual Class for such Distribution Date, the excess for such Distribution Date (accumulated with all such excesses for all prior Distribution Dates) will be added to any increase in the Overcollateralized Amount for purposes of determining the amount of interest accrual on the Intermediate REMIC Accrual Class payable as principal on the Intermediate REMIC Accretion Directed Class on the next Distribution Date pursuant to the first sentence of this paragraph. All payments of scheduled principal and prepayments of principal generated by the Mortgage Loans shall be allocated 50% to the Intermediate REMIC Accrual Class, and 50% to the Intermediate REMIC Accretion Directed Classes (principal payments shall be allocated among such Intermediate REMIC Accretion Directed Classes in an amount equal to 50% of the principal amounts allocated to their respective Corresponding Classes), until paid in full. Notwithstanding the above, principal payments allocated to the Class X Certificates that result in the reduction in the Overcollateralized Amount shall be allocated to the Intermediate REMIC Accrual Class (until paid in full). Realized losses shall be applied so that after all distributions have been made on each Distribution Date (i) the principal balances of each of the Intermediate REMIC Accretion Directed Class is equal to 50% of the principal balance of its respective Corresponding Class, and (ii) the Intermediate REMIC Accrual Class is equal to 50% of the aggregate principal balance of the Mortgage Pool plus 50% of the Overcollateralized Amount. (3) The Subsidiary REMIC Regular Interests shall have the following principal balances, pass-through rates and Corresponding Classes of Certificates in the manner set forth in the following table: ------------------------ ----------------------------- ---------------------------- ---------------------------- ------------------------------------------------------------------------------ Corresponding REMIC Initial Interest Class of Master Interests Balance Rate REMIC Interest ------------------------ ----------------------------- ---------------------------- ---------------------------- ------------------------------------------------------------------------------ LT-A (Pool Principal Balance) (1) N/A less $82,857,300 ------------------------ ----------------------------- ---------------------------- ---------------------------- 120,000,000 ------------------------------------------------------------------------------ LT-BIO A-IO $82,857,200 120,000,000 (1) N/A ------------------------ ----------------------------- ---------------------------- ---------------------------- ------------------------------------------------------------------------------ LT-P $100 (2) N/A ------------------------ ----------------------------- ---------------------------- ---------------------------- ---------------------------------------------------------------------------------------------------------------- ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- ______________________________________________________________________________ (1) Weighted average of the Net Loan Rates of the Mortgage Loans. (2) The Class LT-P Interests will not be entitled to payments of interest. . (b) On each Distribution Date, all Realized Losses, prepayments and payments of scheduled principal will be allocated to Class LT-A1 A until paid in full or eliminated by such losses, and all additional Realized losses, prepayments and payments of scheduled principal will be allocated to Class LT-BIOA-IO.