Execution Copy
RESIDENTIAL ASSET MORTGAGE PRODUCTS, INC.,
Depositor,
RESIDENTIAL FUNDING CORPORATION,
Master Servicer,
and
JPMORGAN CHASE BANK, N.A.,
Trustee
POOLING AND SERVICING AGREEMENT
DATED AS OF DECEMBER 1, 2005
MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATES
Series 2005-SP3
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
Section 1.01. Definitions...............................................................3
Section 1.02. Determination of LIBOR...................................................46
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01. Conveyance of Mortgage Loans.............................................47
Section 2.02. Acceptance by Trustee....................................................52
Section 2.03. Representations, Warranties and Covenants of the Master Servicer
and the Depositor........................................................54
Section 2.04. Representations and Warranties of Residential Funding....................56
Section 2.05. Execution and Authentication of Certificates; Conveyance of REMIC
Regular Interests........................................................58
Section 2.06. Purposes and Powers of the Trust.........................................58
Section 2.07. Agreement Regarding Ability to Disclose..................................59
ARTICLE III
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 3.01. Master Servicer to Act as Servicer.......................................59
Section 3.02. Subservicing Agreements Between Master Servicer and Subservicers;
Enforcement of Subservicers' Obligations.................................61
Section 3.03. Successor Subservicers...................................................63
Section 3.04. Liability of the Master Servicer.........................................63
Section 3.05. No Contractual Relationship Between Subservicer and Trustee or
Certificateholders.......................................................63
Section 3.06. Assumption or Termination of Subservicing Agreements by Trustee..........63
Section 3.07. Collection of Certain Mortgage Loan Payments; Deposits to Custodial
Account..................................................................64
Section 3.08. Subservicing Accounts; Servicing Accounts................................67
Section 3.09. Access to Certain Documentation and Information Regarding the
Mortgage Loans...........................................................68
Section 3.10. Permitted Withdrawals from the Custodial Account.........................69
Section 3.11. Maintenance of Primary Insurance Coverage................................70
Section 3.12. Maintenance of Fire Insurance and Omissions and Fidelity Coverage........71
Section 3.13. Enforcement of Due-on-Sale Clauses; Assumption and Modification
Agreements; Certain Assignments..........................................72
Section 3.14. Realization Upon Defaulted Mortgage Loans................................74
Section 3.15. Trustee to Cooperate; Release of Mortgage Files..........................77
Section 3.16. Servicing and Other Compensation; Eligible Master Servicing
Compensation.............................................................78
Section 3.17. Reports to the Trustee and the Depositor.................................79
Section 3.18. Annual Statement as to Compliance........................................79
Section 3.19. Annual Independent Public Accountants' Servicing Report..................80
Section 3.20. Right of the Depositor in Respect of the Master Servicer.................81
ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS
Section 4.01. Certificate Account......................................................81
Section 4.02. Distributions............................................................82
Section 4.03. Statements to Certificateholders; Statements to Rating Agencies;
Exchange Act Reporting...................................................88
Section 4.04. Distribution of Reports to the Trustee and the Depositor; Advances
by the Master Servicer...................................................91
Section 4.05. Allocation of Realized Losses............................................92
Section 4.06. Reports of Foreclosures and Abandonment of Mortgaged Property............94
Section 4.07. Optional Purchase of Defaulted Mortgage Loans............................95
Section 4.08. Limited Mortgage Loan Repurchase Right...................................95
Section 4.09. The Yield Maintenance Agreement..........................................96
Section 4.10. [Reserved]...............................................................97
Section 4.11. Derivative Contracts.....................................................97
Section 4.12. Tax Treatment of Yield Maintenance Payments..............................98
ARTICLE V
THE CERTIFICATES
Section 5.01. The Certificates.........................................................98
Section 5.02. Registration of Transfer and Exchange of Certificates...................100
Section 5.03. Mutilated, Destroyed, Lost or Stolen Certificates.......................106
Section 5.04. Persons Deemed Owners...................................................106
Section 5.05. Appointment of Paying Agent.............................................106
ARTICLE VI
THE DEPOSITOR AND THE MASTER SERVICER
Section 6.01. Respective Liabilities of the Depositor and the Master Servicer.........107
Section 6.02. Merger or Consolidation of the Depositor or the Master Servicer;
Assignment of Rights and Delegation of Duties by Master Servicer........107
Section 6.03. Limitation on Liability of the Depositor, the Master Servicer and
Others..................................................................108
Section 6.04. Depositor and Master Servicer Not to Resign.............................109
ARTICLE VII
DEFAULT
Section 7.01. Events of Default.......................................................109
Section 7.02. Trustee or Depositor to Act; Appointment of Successor...................111
Section 7.03. Notification to Certificateholders......................................112
Section 7.04. Waiver of Events of Default.............................................112
ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.01. Duties of Trustee.......................................................113
Section 8.02. Certain Matters Affecting the Trustee...................................114
Section 8.03. Trustee Not Liable for Certificates or Mortgage Loans...................116
Section 8.04. Trustee May Own Certificates............................................116
Section 8.05. Master Servicer to Pay Trustee's Fees and Expenses; Indemnification.....116
Section 8.06. Eligibility Requirements for Trustee....................................117
Section 8.07. Resignation and Removal of the Trustee..................................118
Section 8.08. Successor Trustee.......................................................119
Section 8.09. Merger or Consolidation of Trustee......................................119
Section 8.10. Appointment of Co-Trustee or Separate Trustee...........................119
Section 8.11. Appointment of Custodians...............................................120
Section 8.12. Appointment of Office or Agency.........................................121
Section 8.13. DTC Letter of Representations...........................................121
Section 8.14. Yield Maintenance Agreement.............................................121
ARTICLE IX
TERMINATION
Section 9.01. Termination Upon Purchase by Residential Funding or Liquidation of
All Mortgage Loans......................................................121
Section 9.02. Additional Termination Requirements.....................................124
ARTICLE X
REMIC PROVISIONS
Section 10.01. REMIC Administration....................................................125
Section 10.02. Master Servicer, REMIC Administrator and Trustee Indemnification........128
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01. Amendment...............................................................129
Section 11.02. Recordation of Agreement; Counterparts..................................132
Section 11.03. Limitation on Rights of Certificateholders..............................132
Section 11.04. Governing Law...........................................................133
Section 11.05. Notices.................................................................133
Section 11.06. Notices to Rating Agencies..............................................134
Section 11.07. Severability of Provisions..............................................135
Section 11.08. Supplemental Provisions for Resecuritization............................135
Section 11.09. [Reserved]..............................................................135
Section 11.10. Third Party Beneficiaries...............................................135
Exhibits
Exhibit A Form of Class A Certificate
Exhibit B Form of Class M Certificate
Exhibit C Form of Class B Certificate
Exhibit D Form of Class SB Certificate
Exhibit E Form of Class R Certificate
Exhibit F Form of Custodial Agreement
Exhibit G Mortgage Loan Schedule
Exhibit H Forms of Request for Release
Exhibit I-1 Form of Transfer Affidavit and Agreement
Exhibit I-2 Form of Transferor Certificate
Exhibit J Form of Investor Representation Letter
Exhibit K Form of Transferor Representation Letter
Exhibit L Text of Amendment to Pooling and Servicing Agreement Pursuant to Section
11.01(e) for a Limited Guaranty
Exhibit M Form of Limited Guaranty
Exhibit N Form of Lender Certification for Assignment of Mortgage Loan
Exhibit O Form of Rule 144A Investment Representation
Exhibit P [Reserved]
Exhibit Q Form of ERISA Representation Letter (Class M Certificates and Restricted Class
A Certificates)
Exhibit R-1 Form 10-K Certification
Exhibit R-2 Form 10-K Back-up Certification
Exhibit S Information to be Provided by the Master Servicer to the Rating Agencies
Relating to Reportable Modified Mortgage Loans
Exhibit T [Reserved]
Exhibit U Yield Maintenance Agreement
This Pooling and Servicing Agreement, effective as of December 1, 2005, among
RESIDENTIAL ASSET MORTGAGE PRODUCTS, INC., as depositor (together with its permitted
successors and assigns, the "Depositor"), RESIDENTIAL FUNDING CORPORATION, as master
servicer (together with its permitted successors and assigns, the "Master Servicer"), and
JPMORGAN CHASE BANK, N.A., a banking association organized under the laws of the United
States, as trustee (together with its permitted successors and assigns, the "Trustee").
PRELIMINARY STATEMENT:
The Depositor intends to sell mortgage asset-backed pass-through certificates
(collectively, the "Certificates"), to be issued hereunder in sixteen Classes, which in the
aggregate will evidence the entire beneficial ownership interest in the Mortgage Loans (as
defined herein) and certain other related assets.
REMIC I
As provided herein, the REMIC Administrator will make an election to treat the
segregated pool of assets consisting of the Mortgage Loans and certain other related assets
(exclusive of the Yield Maintenance Agreement and any payments thereunder) subject to this
Agreement as a real estate mortgage investment conduit (a "REMIC") for federal income tax
purposes, and such segregated pool of assets will be designated as "REMIC I." The Class R-I
Certificates will represent the sole Class of "residual interests" in REMIC I for purposes
of the REMIC Provisions (as defined herein) under federal income tax law. The following
table irrevocably sets forth the designation, remittance rate (the "Uncertificated REMIC I
Pass-Through Rate") and initial Uncertificated Principal Balance for each of the "regular
interests" in REMIC I (the "REMIC I Regular Interests"). The "latest possible maturity date"
(determined for purposes of satisfying Treasury regulation Section 1.860G-1(a)(4)(iii)) for
the REMIC I Regular Interests shall be the 360th Distribution Date. The REMIC I Regular
Interests will not be certificated.
Initial
Uncertificated REMIC I Uncertificated REMIC I Latest Possible
Designation Pass-Through Rate Principal Balance Maturity Date
AA (1) $283,636,001.18 December 2035
A-1 (1) $1,357,000.00 December 2035
A-2 (1) $698,840.00 December 2035
A-3 (1) $493,000.00 December 2035
M-1 (1) $125,900.00 December 2035
M-2 (1) $ 88,270.00 December 2035
M-3 (1) $34,730.00 December 2035
M-4 (1) $14,470.00 December 2035
M-5 (1) $28,940.00 December 2035
B (1) $14,470.00 December 2035
ZZ (1) $2,894,244.91 December 2035
(1) Calculated as provided in the definition of Uncertificated REMIC I Pass-Through Rate.
REMIC II
As provided herein, the REMIC Administrator will elect to treat the segregated pool
of assets consisting of the REMIC I Regular Interests as a REMIC for federal income tax
purposes, and such segregated pool of assets will be designated as "REMIC II". The Class
R-II Certificates will represent the sole class of "residual interests" in REMIC II for
purposes of the REMIC Provisions under federal income tax law. The following table
irrevocably sets forth the designation, Pass-Through Rate, aggregate Initial Certificate
Principal Balance, certain features, Final Scheduled Distribution Date and initial ratings
for each Class of Certificates comprising the interests representing "regular interests" in
REMIC II. The "latest possible maturity date" (determined for purposes of satisfying
Treasury Regulation Section 1.860G-1(a)(4)(iii)) for each Class of REMIC II Regular
Interests shall be the 360th Distribution Date.
Aggregate
Initial Final
Certificate Scheduled
Pass-Through Principal Distribution
Designation Type Rate Balance Date Initial Ratings
▇▇▇▇▇'▇ S&P Fitch
Class A-1(1) Senior Adjustable(2) $135,700,000.00 December 2035 Aaa AAA AAA
(3)
Class A-2(1) Senior Adjustable(2) $69,984,000.00 December 2035 Aaa AAA AAA
(3)
Class Senior Adjustable(2) $49,300,000.00 December 2035 Aaa AAA AAA
A-3(1) (3)
Class M-1(1) Mezzanine Adjustable(2) $12,590,000.00 December 2035 Aa2 AA AA
(3)
Class M-2(1) Mezzanine Adjustable(2) $8,827,000.00 December 2035 A2 A A
(3)
Class M-3(1) Mezzanine Adjustable(2) $3,473,000.00 December 2035 Baa1 BBB+ BBB+
(3)
Class M-4(1) Mezzanine Adjustable(2) $1,447,000.00 December 2035 Baa2 BBB BBB
(3)
Class M-5(1) Mezzanine Adjustable(2) $2,894,000.00 December 2035 Baa3 BBB- BBB-
(3)
Class B(1) Subordinate Adjustable(2) $1,447,000.00 December 2035 N/R BB+ BB+
(3)
Class SB
Interest Subordinate Variable(4) $3,762,491.00 N/A N/R N/R N/R
Class R-I Residual N/A N/A N/A N/R N/R N/R
Class R-II Residual N/A N/A N/A N/R N/R N/R
____________
(1) The Class A, Class M and Class B Certificates will represent ownership of REMIC II
Regular Interests together with certain rights to payments to be made from amounts received
under the Yield Maintenance Agreement which will be treated as an interest rate cap contract,
the payments on which will be deemed made for federal income tax purposes outside of REMIC II.
(2) The REMIC II Regular Interests ownership of which is represented by the Class A, Class
M and Class B Certificates, will accrue interest at a per annum rate equal to LIBOR plus the
applicable Margin, each subject to payment caps as described in the definition of "Pass-Through
Rate" and the provisions for the payment of Class A Net WAC Cap Shortfall Carry-Forward
Amounts, Class M Net WAC Cap Shortfall Carry-Forward Amounts and Class B Net WAC Cap Shortfall
Carry-Forward Amounts herein, which payments will not be part of the entitlement of the REMIC
II Regular Interests related to such Certificates.
(3) The Class A, Class M and Class B Certificates will also entitle their holders to
certain payments from the Holder of the Class SB Certificates from amounts to which the related
REMIC II Regular Interest is entitled and from amounts received under the Yield Maintenance
Agreement, which will not be a part of their ownership of the REMIC II Regular Interests.
(4) The Class SB Certificates will accrue interest as described in the definition of
Accrued Certificate Interest. The Class SB Certificates will not accrue interest on their
Certificate Principal Balance. The Class SB Certificates will be comprised of two REMIC II
regular interests, a principal only regular interest designated SB PO and an interest only
regular interest designated SB-IO, which will be entitled to distributions as set forth herein.
The rights of the Holder of the Class SB Certificates to payments from the Yield Maintenance
Agreement shall be outside and apart from its rights under the REMIC II Regular Interests SB-IO
and SB PO.
The Mortgage Loans have an aggregate Cut-off Date Principal Balance equal to
$289,424,491.00. The Mortgage Loans are fixed-rate and adjustable-rate, first and junior
lien seasoned mortgage loans having terms to maturity at origination or modification of
generally not more than 30 years.
In consideration of the mutual agreements herein contained, the Depositor, the Master
Servicer and the Trustee agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01...Definitions.
Whenever used in this Agreement, the following words and phrases, unless the context
otherwise requires, shall have the meanings specified in this Article.
Accrued Certificate Interest: With respect to each Distribution Date and the Class
A, Class M Certificates and Class B Certificates, interest accrued during the related
Interest Accrual Period on the Certificate Principal Balance thereof immediately prior to
such Distribution Date at the related Pass-Through Rate for that Distribution Date.
The amount of Accrued Certificate Interest on each Class of Certificates shall be
reduced by the amount of Prepayment Interest Shortfalls on the Mortgage Loans during the
prior calendar month (to the extent not covered by Eligible Master Servicing Compensation
pursuant to Section 3.16) and by the amount of Relief Act Shortfalls and Deferred Interest
Shortfalls on the Mortgage Loans during the related Due Period, in each case to the extent
allocated to that Class of Certificates pursuant to Section 4.02(g) and Section 4.02(h),
respectively. Accrued Certificate Interest for each Class on any Distribution Date shall be
further reduced by the interest portion of Realized Losses allocated to any Class of
Certificates pursuant to Section 4.05.
With respect to each Distribution Date and the Class SB Certificates, interest
accrued during the preceding Interest Accrual Period at the related Pass-Through Rate for
that Distribution Date on the Uncertificated Notional Amount as specified in the definition
of Pass-Through Rate, immediately prior to such Distribution Date, reduced by any interest
shortfalls with respect to the Mortgage Loans, including Prepayment Interest Shortfalls to
the extent not covered by Eligible Master Servicing Compensation pursuant to Section 3.16 or
by the Excess Cash Flow pursuant to clauses (xvi) and (xvii) of Section 4.02(c). In
addition, Accrued Certificate Interest with respect to each Distribution Date, as to the
Class SB Certificates, shall be reduced by an amount equal to the interest portion of
Realized Losses allocated to the Overcollateralization Amount pursuant to Section 4.05
hereof. Accrued Certificate Interest on the Class A, Class M and Class B Certificates shall
accrue on the basis of a 360-day year and the actual number of days in the related Interest
Accrual Period. Accrued Certificate Interest on the Class SB Certificates shall accrue on
the basis of a 360 day year consisting of twelve 30 day months.
Adjusted Mortgage Rate: With respect to any Mortgage Loan and any date of
determination, the Mortgage Rate borne by the related Mortgage Note, less the related
Subservicing Fee Rate.
Adjustment Date: With respect to each adjustable-rate Mortgage Loan, each date set
forth in the related Mortgage Note on which an adjustment to the interest rate on such
Mortgage Loan becomes effective.
Advance: With respect to any Mortgage Loan, any advance made by the Master Servicer,
pursuant to Section 4.04.
Affiliate: With respect to any Person, any other Person controlling, controlled by
or under common control with such first Person. For the purposes of this definition,
"control" means the power to direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the foregoing.
Agreement: This Pooling and Servicing Agreement and all amendments hereof and
supplements hereto.
Amount Held for Future Distribution: With respect to any Distribution Date, the
total of the amounts held in the Custodial Account at the close of business on the preceding
Determination Date on account of (i) Liquidation Proceeds, Subsequent Recoveries, REO
Proceeds, Insurance Proceeds, Principal Prepayments, Mortgage Loan purchases made pursuant
to Section 2.02, 2.03, 2.04, 4.07 or 4.08 and Mortgage Loan substitutions made pursuant to
Section 2.03 or 2.04 received or made in the month of such Distribution Date (other than
such Liquidation Proceeds, Insurance Proceeds, REO Proceeds, Subsequent Recoveries and
purchases of Mortgage Loans that the Master Servicer has deemed to have been received in the
preceding month in accordance with Section 3.07(b)) and (ii) payments which represent early
receipt of scheduled payments of principal and interest due on a date or dates subsequent to
the Due Date in the related Due Period.
Appraised Value: With respect to any Mortgaged Property, one of the following: (i)
the lesser of (a) the appraised value of such Mortgaged Property based upon the appraisal
made at the time of the origination of the related Mortgage Loan, and (b) the sales price of
the Mortgaged Property at such time of origination, (ii) in the case of a Mortgaged Property
securing a refinanced or modified Mortgage Loan, one of (1) the appraised value based upon
the appraisal made at the time of origination of the loan which was refinanced or modified,
(2) the appraised value determined in an appraisal made at the time of refinancing or
modification or (3) the sales price of the Mortgaged Property, or (iii) with respect to the
Mortgage Loans for which a broker's price opinion was obtained, the value contained in such
opinion.
Assignment: An assignment of the Mortgage, notice of transfer or equivalent
instrument, in recordable form, sufficient under the laws of the jurisdiction wherein the
related Mortgaged Property is located to reflect of record the sale of the Mortgage Loan to
the Trustee for the benefit of Certificateholders, which assignment, notice of transfer or
equivalent instrument may be in the form of one or more blanket assignments covering
Mortgages secured by Mortgaged Properties located in the same county, if permitted by law
and accompanied by an Opinion of Counsel to that effect.
Assignment Agreement: The Assignment and Assumption Agreement, dated the Closing
Date, between Residential Funding and the Depositor relating to the transfer and assignment
of the Mortgage Loans.
Assignment of Proprietary Lease: With respect to a Cooperative Loan, the assignment
of the related Cooperative Lease from the Mortgagor to the originator of the Cooperative
Loan.
Available Distribution Amount: With respect to any Distribution Date, an amount
equal to (a) the sum of (i) the amount relating to the Mortgage Loans on deposit in the
Custodial Account as of the close of business on the immediately preceding Determination
Date, including any Subsequent Recoveries, and amounts deposited in the Custodial Account in
connection with the substitution of Qualified Substitute Mortgage Loans, (ii) the amount of
any Advance made on the immediately preceding Certificate Account Deposit Date with respect
to the Mortgage Loans, (iii) any amount deposited in the Certificate Account on the related
Certificate Account Deposit Date pursuant to Section 3.12(a) in respect of the Mortgage
Loans, (iv) any amount that the Master Servicer is not permitted to withdraw from the
Custodial Account pursuant to Section 3.16(e) in respect of the Mortgage Loans and (v) any
amount deposited in the Certificate Account pursuant to Section 4.07 or 4.08 and any amounts
deposited in the Custodial Account pursuant to Section 9.01, reduced by (b) the sum as of
the close of business on the immediately preceding Determination Date of: (w) any payments
or collections consisting of prepayment charges on the Mortgage Loans that were received
during the related Prepayment Period, (x) the Amount Held for Future Distribution and (y)
amounts permitted to be withdrawn by the Master Servicer from the Custodial Account pursuant
to clauses (ii)-(x), inclusive, of Section 3.10(a).
Balloon Loan: Each of the Mortgage Loans having an original term to maturity that is
shorter than the related amortization term.
Balloon Payment: With respect to any Balloon Loan, the related Monthly Payment
payable on the stated maturity date of such Balloon Loan.
Bankruptcy Code: The Bankruptcy Code of 1978, as amended.
Book-Entry Certificate: Any Certificate registered in the name of the Depository or
its nominee.
Business Day: Any day other than (i) a Saturday or a Sunday or (ii) a day on which
banking institutions in the States of California, New York, Minnesota or Illinois (and such
other state or states in which the Custodial Account or the Certificate Account are at the
time located) are required or authorized by law or executive order to be closed.
Call Rights: As defined in Section 9.01(e).
Calendar Quarter: A Calendar Quarter shall consist of one of the following time
periods in any given year: January 1 through March 31, April 1 through June 30, July 1
though September 30, and October 1 through December 31
Capitalization Reimbursement Amount: With respect to any Distribution Date, the
amount of unreimbursed Advances or Servicing Advances that were added to the Stated
Principal Balance of the related Mortgage Loans during the preceding calendar month and
reimbursed to the Master Servicer or Subservicer pursuant to Section 3.10(a)(vii) on or
prior to such Distribution Date plus the Capitalization Reimbursement Shortfall Amount
remaining unreimbursed from any prior Distribution Date and reimbursed to the Master
Servicer or Subservicer on or prior to such Distribution Date.
Capitalization Reimbursement Shortfall Amount: As to any Distribution Date, the
amount, if any, by which the amount of Advances or Servicing Advances that were added to the
Stated Principal Balance of the Mortgage Loans during the preceding calendar month exceeds
the amount of principal payments on the Mortgage Loans included in the Available
Distribution Amount for such Distribution Date.
Cash Liquidation: With respect to any defaulted Mortgage Loan other than a Mortgage
Loan as to which an REO Acquisition occurred, a determination by the Master Servicer that it
has received all Insurance Proceeds, Liquidation Proceeds and other payments or cash
recoveries which the Master Servicer reasonably and in good faith expects to be finally
recoverable with respect to such Mortgage Loan.
Certificate: Any Class A Certificate, Class M Certificate, Class B, Class SB
Certificate or Class R Certificate.
Certificate Account: The account or accounts created and maintained pursuant to
Section 4.01, which shall be entitled "JPMorgan Chase Bank, N.A. as trustee, in trust for
the registered holders of Residential Asset Mortgage Products, Inc., Mortgage Asset-Backed
Pass-Through Certificates, Series 2005-SP3" and which account shall be held for the benefit
of the Certificateholders and which must be an Eligible Account.
Certificate Account Deposit Date: With respect to any Distribution Date, the
Business Day prior thereto.
Certificateholder or Holder: The Person in whose name a Certificate is registered in
the Certificate Register, except that neither a Disqualified Organization nor a Non-United
States Person shall be a holder of a Class R Certificate for any purpose hereof. Solely for
the purpose of giving any consent or direction pursuant to this Agreement, any Certificate,
other than a Class R Certificate, registered in the name of the Depositor, the Master
Servicer or any Subservicer or any Affiliate thereof shall be deemed not to be outstanding
and the Percentage Interest or Voting Rights evidenced thereby shall not be taken into
account in determining whether the requisite amount of Percentage Interests or Voting Rights
necessary to effect any such consent or direction has been obtained. All references herein
to "Holders" or "Certificateholders" shall reflect the rights of Certificate Owners as they
may indirectly exercise such rights through the Depository and participating members
thereof, except as otherwise specified herein; provided, however, that the Trustee shall be
required to recognize as a "Holder" or "Certificateholder" only the Person in whose name a
Certificate is registered in the Certificate Register.
Certificate Owner: With respect to a Book-Entry Certificate, the Person who is the
beneficial owner of such Certificate, as reflected on the books of an indirect participating
brokerage firm for which a Depository Participant acts as agent, if any, and otherwise on
the books of a Depository Participant, if any, and otherwise on the books of the Depository.
Certificate Principal Balance: With respect to any Class A, Class M Certificate or
Class B Certificate, on any date of determination, an amount equal to (i) the Initial
Certificate Principal Balance of such Certificate as specified on the face thereof, minus
(ii) the sum of (x) the aggregate of all amounts previously distributed with respect to such
Certificate (or any predecessor Certificate) and applied to reduce the Certificate Principal
Balance thereof pursuant to Section 4.02(c) and (y) the aggregate of all reductions in
Certificate Principal Balance deemed to have occurred in connection with Realized Losses
which were previously allocated to such Certificate (or any predecessor Certificate)
pursuant to Section 4.05, provided, that with respect to any Distribution Date, the
Certificate Principal Balance of each class of Class A, Class M and Class B Certificates to
which a Realized Loss was previously allocated and remains unreimbursed will be increased,
sequentially, as follows: first, the Class A Certificates on a pro rata basis, then the
Class ▇-▇, ▇▇▇▇▇ ▇-▇, Class M-3, Class M-4, Class M-5 and Class B Certificates, in that
order, to the extent of Realized Losses previously allocated thereto and remaining
unreimbursed, but only to the extent of Subsequent Recoveries received during the previous
calendar month and available for distribution pursuant to Section 4.02(c)(xiii). With
respect to each Class SB Certificate, on any date of determination, an amount equal to the
Percentage Interest evidenced by such Certificate times an amount equal to the excess, if
any, of (A) the then aggregate Stated Principal Balance of the Mortgage Loans over (B) the
then aggregate Certificate Principal Balance of the Class A, Class M and Class B
Certificates then outstanding. The Class R Certificates will not have a Certificate
Principal Balance.
Certificate Register and Certificate Registrar: The register maintained and the
registrar appointed pursuant to Section 5.02.
Class: Collectively, all of the Certificates or uncertificated interests bearing the
same designation.
Class A Certificate: Any one of the Class A-1, Class A-2 or Class A-3 Certificates.
Class A Interest Distribution Amount: With respect to each Class of Class A
Certificates and any Distribution Date, the aggregate amount of Accrued Certificate Interest
to be distributed to the holders of such Class of Class A Certificates for such Distribution
Date, plus any related Accrued Certificate Interest thereon remaining unpaid from any prior
Distribution Date.
Class A Margin: With respect to the Class A-1 Certificates, 0.150% per annum and on
any Distribution Date on or after the second Distribution Date after the first possible
Optional Termination Date, 0.300% per annum. With respect to the Class A-2 Certificates,
initially 0.310% per annum, and on any Distribution Date on or after the second Distribution
Date after the possible Optional Termination Date, 0.620% per annum. With respect to the
Class A-3 Certificates, initially 0.390% per annum, and on any Distribution Date on or after
the second Distribution Date after the first possible Optional Termination Date, 0.780% per
annum.
Class A Net WAC Cap Shortfall: With respect to each Class of the Class A
Certificates and any Distribution Date for which the Pass-Through Rate for any such Class of
Class A Certificates is equal to the Net WAC Cap Rate, the excess, if any, of (x) Accrued
Certificate Interest on that Class of Certificates on such Distribution Date, calculated at
a rate equal to the lesser of (a) LIBOR plus the related Class A Margin, as calculated for
such Distribution Date, and (b) the Maximum Mortgage Loan Rate, over (y) Accrued Certificate
Interest on such Class of Class A Certificates for such Distribution Date calculated at the
Net WAC Cap Rate.
Class A Net WAC Cap Shortfall Carry-Forward Amount: With respect to each Class of
Class A Certificates and any Distribution Date, the sum of (a) the aggregate amount of Class
A Net WAC Cap Shortfall for such Class on such Distribution Date plus (b) any Class A Net
WAC Cap Shortfall Carry-Forward Amount for such Class remaining unpaid from the preceding
Distribution Date, plus (c) one month's interest on the amount in clause (b) (based on the
number of days in the preceding Interest Accrual Period), to the extent previously
unreimbursed by the Excess Cash Flow pursuant to Section 4.02(c)(xviii), at a rate equal to
the related Pass-Through Rate.
Class A Principal Distribution Amount: With respect to any Distribution Date (i)
prior to the Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
for that Distribution Date, the Principal Distribution Amount for that Distribution Date or
(ii) on or after the Stepdown Date if a Trigger Event is not in effect for that Distribution
Date, the lesser of:
(i) the Principal Distribution Amount for that Distribution Date; and
(ii) the excess, if any, of (A) the aggregate Certificate Principal Balance
of the Class A Certificates immediately prior to that Distribution Date over (B) the
lesser of (x) the product of (1) the applicable Subordination Percentage and (2) the
aggregate Stated Principal Balance of the Mortgage Loans after giving effect to
distributions to be made on that Distribution Date and (y) the excess, if any, of the
aggregate Stated Principal Balance of the Mortgage Loans after giving effect to
distributions to be made on that Distribution Date, over the Overcollateralization
Floor.
Class A-1 Certificate: Any one of the Class A-1 Certificates executed by the Trustee
and authenticated by the Certificate Registrar substantially in the form annexed hereto as
Exhibit A, senior to the Class M, Class B, Class SB and Class R Certificates with respect to
distributions and the allocation of Realized Losses as set forth in Section 4.05, and
evidencing (i) an interest designated as a "regular interest" in REMIC II for purposes of
the REMIC Provisions and (ii) the right to receive the Class A Net WAC Cap Shortfall
Carry-Forward Amount from the Excess Cash Flow to the extent described herein.
Class A-2 Certificate: Any one of the Class A-2 Certificates executed by the Trustee
and authenticated by the Certificate Registrar substantially in the form annexed hereto as
Exhibit A, senior to the Class M, Class B, Class SB and Class R Certificates with respect to
distributions and the allocation of Realized Losses as set forth in Section 4.05, and
evidencing (i) an interest designated as a "regular interest" in REMIC II for purposes of
the REMIC Provisions and (ii) the right to receive the Class A Net WAC Cap Shortfall
Carry-Forward Amount from the Excess Cash Flow to the extent described herein.
Class A-3 Certificate: Any one of the Class A-3 Certificates executed by the Trustee
and authenticated by the Certificate Registrar substantially in the form annexed hereto as
Exhibit A, senior to the Class M, Class B, Class SB and Class R Certificates with respect to
distributions and the allocation of Realized Losses as set forth in Section 4.05, and
evidencing (i) an interest designated as a "regular interest" in REMIC II for purposes of
the REMIC Provisions and (ii) the right to receive the Class A Net WAC Cap Shortfall
Carry-Forward Amount from the Excess Cash Flow to the extent described herein.
Class B Certificate: Any one of the Class B Certificates executed by the Trustee and
authenticated by the Certificate Registrar substantially in the form annexed hereto as
Exhibit C, senior to the Class SB and Class R Certificates with respect to distributions and
the allocation of Realized Losses as set forth in Section 4.05, and evidencing (i) an
interest designated as a "regular interest" in REMIC II for purposes of the REMIC Provisions
and (ii) the right to receive the Class B Net WAC Cap Shortfall Carry-Forward Amount from
the Excess Cash Flow to the extent described herein.
Class B Interest Distribution Amount: With respect to the Class B Certificates and
any Distribution Date, the aggregate amount of Accrued Certificate Interest to be
distributed to the holders of such Class B Certificates for such Distribution Date, plus any
related Accrued Certificate Interest thereon remaining unpaid from any prior Distribution
Date.
Class B Margin: With respect to the Class B Certificates, 2.500% per annum and on
any Distribution Date on or after the second Distribution Date after the first possible
Optional Termination Date, 3.750% per annum.
Class B Net WAC Cap Shortfall: With respect to the Class B Certificates and any
Distribution Date for which the Pass-Through Rate for any such Class of Certificates is
equal to the Net WAC Cap Rate, the excess, if any, of (x) Accrued Certificate Interest on
that Class of Certificates on such Distribution Date, calculated at a rate equal to the
lesser of (a) LIBOR plus the Class B Margin, as calculated for such Distribution Date, and
(b) the Maximum Mortgage Loan Rate, over (y) Accrued Certificate Interest on the Class B
Certificates for such Distribution Date calculated at the Net WAC Cap Rate.
Class B Net WAC Cap Shortfall Carry-Forward Amount: With respect to the Class B
Certificates and any Distribution Date, the sum of (a) the aggregate amount of Class B Net
WAC Cap Shortfall for such Class on such Distribution Date plus (b) any Class B Net WAC Cap
Shortfall Carry-Forward Amount for such Class remaining unpaid from the preceding
Distribution Date, plus (c) one month's interest on the amount in clause (b) (based on the
number of days in the preceding Interest Accrual Period), to the extent previously
unreimbursed by the Excess Cash Flow pursuant to Section 4.02(c)(xviii), at a rate equal to
the related Pass-Through Rate.
Class B Principal Distribution Amount: With respect to any Distribution Date (i)
prior to the Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
for that Distribution Date, the remaining Principal Distribution Amount for that
Distribution Date after distribution of the Class A Principal Distribution Amount, Class M-1
Principal Distribution Amount, Class M-2 Principal Distribution Amount, Class M-3 Principal
Distribution Amount, Class M-4 Principal Distribution Amount and Class M-5 Principal
Distribution Amount or (ii) on or after the Stepdown Date if a Trigger Event is not in
effect for that Distribution Date, the lesser of:
(i) the remaining Principal Distribution Amount for that Distribution Date
after distribution of the Class A Principal Distribution Amount, Class M-1 Principal
Distribution Amount, Class M-2 Principal Distribution Amount, Class M-3 Principal
Distribution Amount, Class M-4 Principal Distribution Amount and Class M-5 Principal
Distribution Amount and
(ii) the excess, if any, of (A) the sum of (1) the aggregate Certificate
Principal Balance of the Class A, Class M-1, Class M-2, Class M-3, Class M-4 and
Class M-5 Certificates (after taking into account the payment of the Class A
Principal Distribution Amount, Class M-1 Principal Distribution Amount, Class M-2
Principal Distribution Amount, Class M-3 Principal Distribution Amount, Class M-4
Principal Distribution Amount and Class M-5 Principal Distribution Amount for that
Distribution Date, and (2) the Certificate Principal Balance of the Class B
Certificates immediately prior to that Distribution Date over (B) the lesser of (x)
the product of (1) the applicable Subordination Percentage and (2) the aggregate
Stated Principal Balance of the mortgage loans after giving effect to distributions
to be made on that Distribution Date and (y) the excess, if any, of the aggregate
Stated Principal Balance of the mortgage loans after giving effect to distributions
to be made on that Distribution Date over the Overcollateralization Floor.
Class M Certificate: Any one of the Class M-1, Class M-2, Class M-3, Class M-4, and
Class M-5 Certificates.
Class M Margin: With respect to the Class M-1 Certificates, initially 0.530% per
annum, and on any Distribution Date on or after the second Distribution Date after the first
possible Optional Termination Date, 0.795% per annum. With respect to the Class M-2
Certificates, initially 0.800% per annum, and on any Distribution Date on or after the
second Distribution Date after the first possible Optional Termination Date, 1.200% per
annum. With respect to the Class M-3 Certificates, initially 2.500% per annum, and on any
Distribution Date on or after the second Distribution Date after the first possible Optional
Termination Date, 3.750% per annum. With respect to the Class M-4 Certificates, initially
2.500% per annum, and on any Distribution Date on or after the second Distribution Date
after the first possible Optional Termination Date, 3.750% per annum. With respect to the
Class M-5 Certificates, initially 2.500% per annum, and on any Distribution Date on or after
the second Distribution Date after the first possible Optional Termination Date, 3.750% per
annum.
Class M Net WAC Cap Shortfall: With respect to each Class of the Class M
Certificates and any Distribution Date for which the Pass-Through Rate for any such Class of
Certificates is equal to the Net WAC Cap Rate, the excess, if any, of (x) Accrued
Certificate Interest on that Class of Certificates on such Distribution Date, using the
lesser of (a) LIBOR plus the related Class M Margin, as calculated for such Distribution
Date, and (b) the Maximum Mortgage Loan Rate, over (y) Accrued Certificate Interest on such
Class of Class M Certificates for such Distribution Date calculated at the Net WAC Cap Rate.
Class M Net WAC Cap Shortfall Carry-Forward Amount: With respect to each Class of
the Class M Certificates and any Distribution Date, the sum of (a) the aggregate amount of
Class M Net WAC Cap Shortfall for each such Class on such Distribution Date plus (b) any
Class M Net WAC Cap Shortfall Carry-Forward Amount for such Classes remaining unpaid from
the preceding Distribution Date, plus (c) one month's interest on the amount in clause (b)
(based on the number of days in the preceding Interest Accrual Period), to the extent
previously unreimbursed by the Excess Cash Flow pursuant to Section 4.02(c)(xviii), at a
rate equal to the related Pass-Through Rate.
Class M-1 Certificate: Any one of the Class M-1 Certificates executed by the Trustee
and authenticated by the Certificate Registrar substantially in the form annexed hereto as
Exhibit B, senior to the Class M-2, Class M-3, Class M-4, Class M-5, Class B, Class SB and
Class R Certificates with respect to distributions and the allocation of Realized Losses as
set forth in Section 4.05, and evidencing (i) an interest designated as a "regular interest"
in REMIC II for purposes of the REMIC Provisions and (ii) the right to receive the Class M
Net WAC Cap Shortfall Carry-Forward Amount from the Excess Cash Flow to the extent described
herein.
Class M-1 Interest Distribution Amount: With respect to the Class M-1 Certificates
and any Distribution Date, the aggregate amount of Accrued Certificate Interest to be
distributed to the holders of such Class for such Distribution Date, plus any related
Accrued Certificate Interest remaining unpaid from any prior Distribution Date.
Class M-1 Principal Distribution Amount: With respect to any Distribution Date (i)
prior to the Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
for that Distribution Date, the remaining Principal Distribution Amount for that
Distribution Date after distribution of the Class A Principal Distribution Amount or (ii) on
or after the Stepdown Date if a Trigger Event is not in effect for that Distribution Date,
the lesser of:
(i) the remaining Principal Distribution Amount for that Distribution Date
after distribution of the Class A Principal Distribution Amount; and
(ii) the excess, if any, of (A) the sum of (1) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account the payment
of the Class A Principal Distribution Amount for that Distribution Date) and (2) the
Certificate Principal Balance of the Class M-1 Certificates immediately prior to that
Distribution Date over (B) the lesser of (x) the product of (1) the applicable
Subordination Percentage and (2) the aggregate Stated Principal Balance of the
Mortgage Loans after giving effect to distributions to be made on that Distribution
Date and (y) the excess, if any, of the aggregate Stated Principal Balance of the
Mortgage Loans after giving effect to distributions to be made on that Distribution
Date, over the Overcollateralization Floor.
Class M-2 Certificate: Any one of the Class M-2 Certificates executed by the Trustee
and authenticated by the Certificate Registrar substantially in the form annexed hereto as
Exhibit B, senior to the Class M-3, Class M-4, Class M-5, Class B, Class SB and Class R
Certificates with respect to distributions and the allocation of Realized Losses as set
forth in Section 4.05, and evidencing (i) an interest designated as a "regular interest" in
REMIC II for purposes of the REMIC Provisions and (ii) the right to receive the Class M Net
WAC Cap Shortfall Carry-Forward Amount from Excess Cash Flow to the extent described herein.
Class M-2 Interest Distribution Amount: With respect to the Class M-2 Certificates
and any Distribution Date, the aggregate amount of Accrued Certificate Interest to be
distributed to the holders of such Class for such Distribution Date, plus any related
Accrued Certificate Interest remaining unpaid from any prior Distribution Date.
Class M-2 Principal Distribution Amount: With respect to any Distribution Date (i)
prior to the Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
for that Distribution Date, the remaining Principal Distribution Amount for that
Distribution Date after distribution of the Class A Principal Distribution Amount and the
Class M-1 Principal Distribution Amount or (ii) on or after the Stepdown Date if a Trigger
Event is not in effect for that Distribution Date, the lesser of:
(i) the remaining Principal Distribution Amount for that Distribution Date
after distribution of the Class A Principal Distribution Amount and the Class M-1
Principal Distribution Amount; and
(ii) the excess, if any, of (A) the sum of (1) the aggregate Certificate
Principal Balance of the Class A Certificates and Class M-1 Certificates (after
taking into account the payment of the Class A Principal Distribution Amount and the
Class M-1 Principal Distribution Amount for that Distribution Date) and (2) the
Certificate Principal Balance of the Class M-2 Certificates immediately prior to that
Distribution Date over (B) the lesser of (x) the product of (1) the applicable
Subordination Percentage and (2) the aggregate Stated Principal Balance of the
Mortgage Loans after giving effect to distributions to be made on that Distribution
Date and (y) the excess, if any, of the aggregate Stated Principal Balance of the
Mortgage Loans after giving effect to distributions to be made on that Distribution
Date, over the Overcollateralization Floor.
Class M-3 Certificate: Any one of the Class M-3 Certificates executed by the Trustee
and authenticated by the Certificate Registrar substantially in the form annexed hereto as
Exhibit B, senior to the Class M-4, Class M-5, Class B, Class SB and Class R Certificates
with respect to distributions and the allocation of Realized Losses as set forth in Section
4.05, and evidencing (i) an interest designated as a "regular interest" in REMIC II for
purposes of the REMIC Provisions and (ii) the right to receive the Class M Net WAC Cap
Shortfall Carry-Forward Amount from Excess Cash Flow to the extent described herein.
Class M-3 Interest Distribution Amount: With respect to the Class M-3 Certificates
and any Distribution Date, the aggregate amount of Accrued Certificate Interest to be
distributed to the holders of such Class for such Distribution Date, plus any related
Accrued Certificate Interest remaining unpaid from any prior Distribution Date.
Class M-3 Principal Distribution Amount: With respect to any Distribution Date (i)
prior to the Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
for that Distribution Date, the remaining Principal Distribution Amount for that
Distribution Date after distribution of the Class A Principal Distribution Amount, Class M-1
Principal Distribution Amount and Class M-2 Principal Distribution Amount or (ii) on or
after the Stepdown Date if a Trigger Event is not in effect for that Distribution Date, the
lesser of:
(i) the remaining Principal Distribution Amount for that Distribution Date
after distribution of the Class A, Class M-1 and Class M-2 Principal Distribution
Amounts; and
(ii) the excess, if any, of (A) the sum of (1) the aggregate Certificate
Principal Balance of the Class A, Class M-1 and Class M-2 Certificates (after taking
into account the payment of the Class A, Class M-1 and Class M-2 Principal
Distribution Amounts for that Distribution Date) and (2) the Certificate Principal
Balance of the Class M-3 Certificates immediately prior to that Distribution Date
over (B) the lesser of (x) the product of (1) the applicable Subordination Percentage
and (2) the aggregate Stated Principal Balance of the Mortgage Loans after giving
effect to distributions to be made on that Distribution Date and (y) the excess, if
any, of the aggregate Stated Principal Balance of the Mortgage Loans after giving
effect to distributions to be made on that Distribution Date, over the
Overcollateralization Floor.
Class M-4 Certificate: Any one of the Class M-4 Certificates executed by the Trustee
and authenticated by the Certificate Registrar substantially in the form annexed hereto as
Exhibit B, senior to the Class M-5, Class B, Class SB and Class R Certificates with respect
to distributions and the allocation of Realized Losses as set forth in Section 4.05, and
evidencing (i) an interest designated as a "regular interest" in REMIC II for purposes of
the REMIC Provisions and (ii) the right to receive the Class M Net WAC Cap Shortfall
Carry-Forward Amount from the Excess Cash Flow to the extent described herein.
Class M-4 Interest Distribution Amount: With respect to the Class M-4 Certificates
and any Distribution Date, the aggregate amount of Accrued Certificate Interest to be
distributed to the holders of such Class for such Distribution Date, plus any related
Accrued Certificate Interest remaining unpaid from any prior Distribution Date.
Class M-4 Principal Distribution Amount: With respect to any Distribution Date (i)
prior to the Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
for that Distribution Date, the remaining Principal Distribution Amount for that
Distribution Date after distribution of the Class A Principal Distribution Amount, Class M-1
Principal Distribution Amount, Class M-2 Principal Distribution Amount and Class M-3
Principal Distribution Amount or (ii) on or after the Stepdown Date if a Trigger Event is
not in effect for that Distribution Date, the lesser of:
(i) the remaining Principal Distribution Amount for that Distribution Date
after distribution of the Class A, Class M-1, Class M-2 and Class M-3 Principal
Distribution Amounts; and
(ii) the excess, if any, of (A) the sum of (1) the aggregate Certificate
Principal Balance of the Class A, Class M-1, Class M-2 and Class M-3 Certificates
(after taking into account the payment of the Class A, Class M-1, Class M-2 and Class
M-3 Principal Distribution Amounts for that Distribution Date) and (2) the
Certificate Principal Balance of the Class M-4 Certificates immediately prior to that
Distribution Date over (B) the lesser of (x) the product of (1) the applicable
Subordination Percentage and (2) the aggregate Stated Principal Balance of the
Mortgage Loans after giving effect to distributions to be made on that Distribution
Date and (y) the excess, if any, of the aggregate Stated Principal Balance of the
Mortgage Loans after giving effect to distributions to be made on that Distribution
Date, over the Overcollateralization Floor.
Class M-5 Certificate: Any one of the Class M-5 Certificates executed by the Trustee
and authenticated by the Certificate Registrar substantially in the form annexed hereto as
Exhibit B, senior to the Class B, Class SB and Class R Certificates with respect to
distributions and the allocation of Realized Losses as set forth in Section 4.05, and
evidencing (i) an interest designated as a "regular interest" in REMIC II for purposes of
the REMIC Provisions and (ii) the right to receive the Class M Net WAC Cap Shortfall
Carry-Forward Amount from Excess Cash Flow to the extent described herein.
Class M-5 Interest Distribution Amount: With respect to the Class M-5 Certificates
and any Distribution Date, the aggregate amount of Accrued Certificate Interest to be
distributed to the holders of such Class for such Distribution Date, plus any related
Accrued Certificate Interest remaining unpaid from any prior Distribution Date.
Class M-5 Principal Distribution Amount: With respect to any Distribution Date (i)
prior to the Stepdown Date or on or after the Stepdown Date if a Trigger Event is in effect
for that Distribution Date, the remaining Principal Distribution Amount for that
Distribution Date after distribution of the Class A Principal Distribution Amount, Class M-1
Principal Distribution Amount, Class M-2 Principal Distribution Amount, Class M-3 Principal
Distribution Amount and Class M-4 Principal Distribution Amount or (ii) on or after the
Stepdown Date if a Trigger Event is not in effect for that Distribution Date, the lesser of:
(i) the remaining Principal Distribution Amount for that Distribution Date
after distribution of the Class A, Class M-1, Class M-2, Class M-3 and Class M-4
Principal Distribution Amounts; and
(ii) the excess, if any, of (A) the sum of (1) the aggregate Certificate
Principal Balance of the Class A, Class M-1, Class M-2, Class M-3 and Class M-4
Certificates (after taking into account the payment of the Class A, Class M-1, Class
M-2, Class M-3 and Class M-4 Principal Distribution Amounts for that Distribution
Date) and (2) the Certificate Principal Balance of the Class M-5 Certificates
immediately prior to that Distribution Date over (B) the lesser of (x) the product of
(1) the applicable Subordination Percentage and (2) the aggregate Stated Principal
Balance of the Mortgage Loans after giving effect to distributions to be made on that
Distribution Date and (y) the excess, if any, of the aggregate Stated Principal
Balance of the Mortgage Loans after giving effect to distributions to be made on that
Distribution Date, over the Overcollateralization Floor.
Class R Certificate: Collectively, 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 hereto as
Exhibit E 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
hereto as Exhibit E and evidencing an interest designated as a "residual interest" in REMIC
II for purposes of the REMIC Provisions.
Class SB Certificate: Any one of the Class SB Certificates executed by the Trustee
and authenticated by the Certificate Registrar substantially in the form annexed hereto as
Exhibit D, subordinate to the Class A Certificates, Class M Certificates and Class B
Certificates with respect to distributions and the allocation of Realized Losses as set
forth in Section 4.05, and evidencing an interest comprised of "regular interests" in REMIC
II together with certain rights to payments under the Yield Maintenance Agreement for
purposes of the REMIC Provisions.
Closing Date: December 29, 2005.
Code: The Internal Revenue Code of 1986, as amended.
Commission: The Securities and Exchange Commission.
Cooperative: A private, cooperative housing corporation which owns or leases land
and all or part of a building or buildings, including apartments, spaces used for commercial
purposes and common areas therein and whose board of directors authorizes, among other
things, the sale of Cooperative Stock.
Cooperative Apartment: A dwelling unit in a multi-dwelling building owned or leased
by a Cooperative, which unit the Mortgagor has an exclusive right to occupy pursuant to the
terms of a proprietary lease or occupancy agreement.
Cooperative Lease: With respect to a Cooperative Loan, the proprietary lease or
occupancy agreement with respect to the Cooperative Apartment occupied by the Mortgagor and
relating to the related Cooperative Stock, which lease or agreement confers an exclusive
right to the holder of such Cooperative Stock to occupy such apartment.
Cooperative Loans: Any of the Mortgage Loans made in respect of a Cooperative
Apartment, evidenced by a Mortgage Note and secured by (i) a Security Agreement, (ii) the
related Cooperative Stock Certificate, (iii) an assignment of the Cooperative Lease, (iv)
financing statements and (v) a stock power (or other similar instrument), and ancillary
thereto, a recognition agreement between the Cooperative and the originator of the
Cooperative Loan, each of which was transferred and assigned to the Trustee pursuant to
Section 2.01 and are from time to time held as part of the Trust Fund.
Cooperative Stock: With respect to a Cooperative Loan, the single outstanding class
of stock, partnership interest or other ownership instrument in the related Cooperative.
Cooperative Stock Certificate: With respect to a Cooperative Loan, the stock
certificate or other instrument evidencing the related Cooperative Stock.
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 ▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Worldwide Securities
Services / Global Debt, RAAC Series 2005-SP3.
Credit Repository: Equifax, Transunion and Experian, or their successors in interest.
Curtailment: Any Principal Prepayment made by a Mortgagor which is not a Principal
Prepayment in Full.
Custodial Account: The custodial account or accounts created and maintained pursuant
to Section 3.07 in the name of a depository institution, as custodian for the holders of the
Certificates, for the holders of certain other interests in mortgage loans serviced or sold
by the Master Servicer and for the Master Servicer, into which the amounts set forth in
Section 3.07 shall be deposited directly. Any such account or accounts shall be an Eligible
Account.
Custodial Agreement: An agreement that may be entered into among the Depositor, the
Master Servicer, the Trustee and a Custodian in substantially the form of Exhibit F hereto.
Custodian: A custodian appointed pursuant to a Custodial Agreement.
Cut-off Date: December 1, 2005.
Cut-off Date Balance: $289,424,491.00.
Cut-off Date Principal Balance: With respect to any Mortgage Loan, the unpaid
principal balance thereof at the Cut-off Date after giving effect to all installments of
principal due on or prior thereto (or due during the month of the Cut-off Date), whether or
not received.
Debt Service Reduction: With respect to any Mortgage Loan, a reduction in the
scheduled Monthly Payment for such Mortgage Loan by a court of competent jurisdiction in a
proceeding under the Bankruptcy Code, except such a reduction constituting a Deficient
Valuation or any reduction that results in a permanent forgiveness of principal.
Deferred Interest: With respect to any Neg Am Loan, as of any Due Date, the amount,
if any, by which the Mortgage Loan Accrued Interest for such Due Date exceeds the Monthly
Payment for such Due Date and which amount, pursuant to the terms of the Mortgage Note, is
added to the Stated Principal Balance of the Mortgage Loan.
Deferred Interest Shortfall: With respect to any Class of the Class A, Class M and
Class B Certificates and any Distribution Date for which Deferred Interest exists and upon
which the Accrued Certificate Interest on the Class A, Class M and Class B Certificates
exceeds the Available Distribution Amount on such Distribution Date, the lesser of (a) such
excess and (b) the amount of such Deferred Interest.
Deficient Valuation: With respect to any Mortgage Loan, a valuation by a court of
competent jurisdiction of the Mortgaged Property in an amount less than the then outstanding
indebtedness under the Mortgage Loan, or any reduction in the amount of principal to be paid
in connection with any scheduled Monthly Payment that constitutes a permanent forgiveness of
principal, which valuation or reduction results from a proceeding under the Bankruptcy Code.
Definitive Certificate: Any definitive, fully registered Certificate.
Deleted Mortgage Loan: A Mortgage Loan replaced or to be replaced with a Qualified
Substitute Mortgage Loan.
Delinquent: As used herein, a Mortgage Loan is considered to be: "30 to 59 days" or
"30 or more days" delinquent when a payment due on any scheduled due date remains unpaid as
of the close of business on the next following monthly scheduled due date; "60 to 89 days"
or "60 or more days" delinquent when a payment due on any scheduled due date remains unpaid
as of the close of business on the second following monthly scheduled due date; and so on.
The determination as to whether a Mortgage Loan falls into these categories is made as of
the close of business on the last business day of each month. For example, a Mortgage Loan
with a payment due on July 1 that remained unpaid as of the close of business on August 31
would then be considered to be 30 to 59 days delinquent. Delinquency information as of the
Cut-off Date is determined and prepared as of the close of business on the last business day
immediately prior to the Cut-off Date.
Depositor: As defined in the preamble hereto.
Depository: The Depository Trust Company, or any successor Depository hereafter
named. The nominee of the initial Depository for purposes of registering those Certificates
that are to be Book-Entry Certificates is Cede & Co. The Depository shall at all times be a
"clearing corporation" as defined in Section 8-102(a)(5) of the Uniform Commercial Code of
the State of New York and a "clearing agency" registered pursuant to the provisions of
Section 17A of the Exchange Act.
Depository Participant: A broker, dealer, bank or other financial institution or
other Person for whom from time to time a Depository effects book-entry transfers and
pledges of securities deposited with the Depository.
Derivative Contract: Any ISDA Master Agreement, together with the related Schedule
and Confirmation, entered into by the Trustee and a Derivative Counterparty in accordance
with Section 4.11.
Derivative Counterparty: Any counterparty to a Derivative Contract as provided in
Section 4.11.
Destroyed Mortgage Note: A Mortgage Note the original of which was permanently lost
or destroyed and has not been replaced.
Determination Date: With respect to any Distribution Date, the 20th day (or if such
20th day is not a Business Day, the Business Day immediately following such 20th day) of the
month of the related Distribution Date.
Disqualified Organization: Any organization defined as a "disqualified organization"
under Section 860E(e)(5) of the Code, which includes any of the following: (i) the United
States, any State or political subdivision thereof, any possession of the United States, or
any agency or instrumentality of any of the foregoing (other than an instrumentality which
is a corporation if all of its activities are subject to tax and, except for ▇▇▇▇▇▇▇ Mac, a
majority of its board of directors is not selected by such governmental unit), (ii) a
foreign government, any international organization, or any agency or instrumentality of any
of the foregoing, (iii) any organization (other than certain farmers' cooperatives described
in Section 521 of the Code) which is exempt from the tax imposed by Chapter 1 of the Code
(including the tax imposed by Section 511 of the Code on unrelated business taxable income)
and (iv) rural electric and telephone cooperatives described in Section 1381(a)(2)(C) of the
Code. A Disqualified Organization also includes any "electing large partnership," as defined
in Section 775(a) of the Code and any other Person so designated by the Trustee based upon
an Opinion of Counsel that the holding of an Ownership Interest in a Class R Certificate by
such Person may cause any REMIC or any Person having an Ownership Interest in any Class of
Certificates (other than such Person) to incur a liability for any federal tax imposed under
the Code that would not otherwise be imposed but for the Transfer of an Ownership Interest
in a Class R Certificate to such Person. The terms "United States", "State" and
"international organization" shall have the meanings set forth in Section 7701 of the Code or
successor provisions.
Distribution Date: The 25th day of any month beginning in the month immediately
following the month of the initial issuance of the Certificates or, if such 25th day is not
a Business Day, the Business Day immediately following such 25th day.
DTC Letter: The Letter of Representations, dated December 29, 2005, between the
Trustee, on behalf of the Trust Fund, and the Depository.
Due Date: With respect to any Distribution Date and any Mortgage Loan, the day
during the related Due Period on which the Monthly Payment is due.
Due Period: With respect to any Distribution Date, the calendar month of such
Distribution Date.
Eligible Account: An account that is any of the following: (i) maintained with a
depository institution the debt obligations of which have been rated by each Rating Agency
in its highest rating available, or (ii) an account or accounts in a depository institution
in which such accounts are fully insured to the limits established by the FDIC, provided
that any deposits not so insured shall, to the extent acceptable to each Rating Agency, as
evidenced in writing, be maintained such that (as evidenced by an Opinion of Counsel
delivered to the Trustee and each Rating Agency) the registered Holders of Certificates have
a claim with respect to the funds in such account or a perfected first security interest
against any collateral (which shall be limited to Permitted Investments) securing such funds
that is superior to claims of any other depositors or creditors of the depository
institution with which such account is maintained, or (iii) in the case of the Custodial
Account, either (A) a trust account or accounts maintained in the corporate trust department
of JPMorgan Chase Bank, N.A., or (B) an account or accounts maintained in the corporate
asset services department of JPMorgan Chase Bank, N.A. as long as its short term debt
obligations are rated P-1 (or the equivalent) or better by each Rating Agency, and its long
term debt obligations are rated A2 (or the equivalent) or better, by each Rating Agency, or
(iv) in the case of the Certificate Account and the Yield Maintenance Deposit Account, a
trust account or accounts maintained in the corporate trust division of JPMorgan Chase Bank,
N.A. 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 Master Servicing Compensation: With respect to any Distribution Date, an
amount equal to Prepayment Interest Shortfalls resulting from Principal Prepayments in Full
or Curtailments during the related Prepayment Period, but not more than the lesser of (a)
one-twelfth of 0.125% of the Stated Principal Balance of the Mortgage Loans immediately
preceding such Distribution Date and (b) the sum of the Servicing Fee, all income and gain
on amounts held in the Custodial Account and the Certificate Account and amounts payable to
the Certificateholders with respect to such Distribution Date and servicing compensation to
which the Master Servicer may be entitled pursuant to Section 3.10(a)(v) and (vi) provided
that for purposes of this definition the amount of the Servicing Fee will not be reduced
pursuant to Section 7.02(a) except as may be required pursuant to the last sentence of such
Section 7.02(a).
ERISA: The Employee Retirement Income Security Act of 1974, as amended.
Event of Default: As defined in Section 7.01.
Excess Cash Flow: With respect to the Mortgage Loans and any Distribution Date, an
amount equal to the sum of (A) the excess of (1) the Available Distribution Amount for that
Distribution Date over (2) the sum of (x) the Interest Distribution Amount for that
Distribution Date and (y) the Principal Remittance Amount for that Distribution Date, (B)
the Overcollateralization Reduction Amount, if any, for that Distribution Date and (C) any
Yield Maintenance Payment for that Distribution Date.
Excess Overcollateralization Amount: With respect to any Distribution Date, the
excess, if any, of (a) the Overcollateralization Amount on such Distribution Date over (b)
the Required Overcollateralization Amount for such Distribution Date.
Exchange Act: The Securities Exchange Act of 1934, as amended.
▇▇▇▇▇▇ ▇▇▇: ▇▇▇▇▇▇ ▇▇▇, a federally chartered and privately owned corporation
organized and existing under the Federal National Mortgage Association Charter Act, or any
successor thereto.
FDIC: The Federal Deposit Insurance Corporation or any successor thereto.
FHA: The Federal Housing Administration, or its successor.
Final Certification: As defined in Section 2.02.
Final Distribution Date: The Distribution Date on which the final distribution in
respect of the Certificates will be made pursuant to Section 9.01, which Final Distribution
Date shall in no event be later than the end of the 90-day liquidation period described in
Section 9.02.
Final Scheduled Distribution Date: With respect to the Class A, Class M, Class Band
Class SB Certificates, solely for purposes of the face of the Certificates, the Distribution
Date in December 2035. No event of default under this Agreement will arise or become
applicable solely by reason of the failure to retire the entire Certificate Principal
Balance of any Class of Class A, Class M or Class B Certificates on or before its Final
Scheduled Distribution Date.
Fitch: Fitch Ratings, Inc., or its successor in interest.
Foreclosure Profits: With respect to any Distribution Date or related Determination
Date and any Mortgage Loan, the excess, if any, of Liquidation Proceeds, Insurance Proceeds
and REO Proceeds (net of all amounts reimbursable therefrom pursuant to Section 3.10(a)(ii))
in respect of each Mortgage Loan or REO Property for which a Cash Liquidation or REO
Disposition occurred in the related Prepayment Period over the sum of the unpaid principal
balance of such Mortgage Loan or REO Property (determined, in the case of an REO
Disposition, in accordance with Section 3.14) plus accrued and unpaid interest at the
Mortgage Rate on such unpaid principal balance from the Due Date to which interest was last
paid by the Mortgagor to the first day of the month following the month in which such Cash
Liquidation or REO Disposition occurred.
▇▇▇▇▇▇▇ Mac: The Federal Home Loan Mortgage Corporation, a corporate instrumentality
of the United States created and existing under Title III of the Emergency Home Finance Act
of 1970, as amended, or any successor thereto.
Gross Margin: With respect to each adjustable rate Mortgage Loan, the fixed
percentage set forth in the related Mortgage Note and indicated in Exhibit G hereto as the
"NOTE MARGIN," which percentage is added to the related Index on each Adjustment Date to
determine (subject to rounding in accordance with the related Mortgage Note, the Periodic
Cap, the Maximum Mortgage Rate and the Minimum Mortgage Rate) the interest rate to be borne
by such Mortgage Loan until the next Adjustment Date.
High Cost Loan: The Mortgage Loans set forth hereto as Exhibit O that are subject to
special rules, disclosure requirements and other provisions that were added to the Federal
Truth in Lending Act by the Home Ownership and Equity Protection Act of 1994.
Independent: When used with respect to any specified Person, means such a Person who
(i) is in fact independent of the Depositor, the Master Servicer and the Trustee, or any
Affiliate thereof, (ii) does not have any direct financial interest or any material indirect
financial interest in the Depositor, the Master Servicer or the Trustee or in an Affiliate
thereof, and (iii) is not connected with the Depositor, the Master Servicer or the Trustee
as an officer, employee, promoter, underwriter, trustee, partner, director or person
performing similar functions.
Index: With respect to any adjustable rate Mortgage Loan and as to any Adjustment
Date therefor, the related index as stated in the related Mortgage Note.
Initial Certificate Principal Balance: With respect to each Class of Certificates
(other than the Class R Certificates), the Certificate Principal Balance of such Class of
Certificates as of the Closing Date as set forth in the Preliminary Statement hereto.
Insurance Proceeds: Proceeds paid in respect of the Mortgage Loans pursuant to any
Primary Insurance Policy or any other related insurance policy covering a Mortgage Loan, to
the extent such proceeds are payable to the mortgagee under the Mortgage, any Subservicer,
the Master Servicer or the Trustee and are not applied to the restoration of the related
Mortgaged Property (or, with respect to a Cooperative Loan, the related Cooperative
Apartment) or released to the Mortgagor in accordance with the procedures that the Master
Servicer would follow in servicing mortgage loans held for its own account.
Interest Accrual Period: With respect to the Class A, Class M and Class B
Certificates, (i) with respect to the Distribution Date in January 2006, the period
commencing on the Closing Date and ending on the day preceding the Distribution Date in
January 2006, and (ii) with respect to any Distribution Date after the Distribution Date in
January 2006, the period commencing on the Distribution Date in the month immediately
preceding the month in which such Distribution Date occurs and ending on the day preceding
such Distribution Date. With respect to the Class SB Certificates and any Distribution Date,
the prior calendar month.
Interest Distribution Amount: The sum of the Class A, Class M-1, Class M-2, Class
M-3, Class M-4, Class M-5 and Class B Interest Distribution Amounts.
Interim Certification: As defined in Section 2.02.
Interested Person: As of any date of determination, the Depositor, the Master
Servicer, the Trustee, any Mortgagor, any Manager of a Mortgaged Property, or any Person
known to a Responsible Officer of the Trustee to be an Affiliate of any of them.
Late Collections: With respect to any Mortgage Loan, all amounts received during any
Due Period, whether as late payments of Monthly Payments or as Insurance Proceeds,
Liquidation Proceeds or otherwise, which represent late payments or collections of Monthly
Payments due but delinquent for a previous Due Period and not previously recovered.
LIBOR: With respect to any Distribution Date, the arithmetic mean of the London
interbank offered rate quotations for one-month U.S. Dollar deposits, expressed on a per
annum basis, determined in accordance with Section 1.02.
LIBOR Business Day: Any day other than (i) a Saturday or Sunday or (ii) a day on
which banking institutions in London, England are required or authorized to by law to be
closed.
LIBOR Rate Adjustment Date: With respect to each Distribution Date, the second LIBOR
Business Day immediately preceding the commencement of the related Interest Accrual Period.
Limited Repurchase Right Holder: RFC Asset Holdings II, Inc., or its successor.
Liquidation Proceeds: Amounts (other than Insurance Proceeds) received by the Master
Servicer in connection with the taking of an entire Mortgaged Property by exercise of the
power of eminent domain or condemnation or in connection with the liquidation of a defaulted
Loan through trustee's sale, foreclosure sale or otherwise, other than REO Proceeds and
Subsequent Recoveries.
Loan-to-Value Ratio: As of any date, the fraction, expressed as a percentage, the
numerator of which is the current principal balance of the related Mortgage Loan at the date
of determination (plus, in the case of a junior lien Mortgage Loan, the principal balance of
the Senior Mortgage Loan on the Related Mortgaged Property) and the denominator of which is
the Appraised Value of the related Mortgaged Property.
Marker Rate: With respect to the Class SB Certificates or the REMIC II Regular
Interest SB-IO and any Distribution Date, a per annum rate equal to two (2) multiplied by
the weighted average of the Uncertificated REMIC I Pass-Through Rates for each REMIC I
Regular Interest (other than the REMIC I Regular Interest AA) with the rates on each such
REMIC I Regular Interest (other than REMIC I Regular Interest ZZ) subject to a cap equal to
the Pass-Through Rate for the corresponding Class for such REMIC I Regular Interest, and the
rate on REMIC I Regular Interest ZZ subject to a cap of zero, in each case for purposes of
this calculation.
Maturity Date: With respect to each Class of Certificates representing ownership of
regular interest or Uncertificated Regular Interests issued by each of REMIC I and REMIC II
the latest possible maturity date, solely for purposes of Section 1.860G-1(a)(4)(iii) of the
Treasury Regulations, by which the Certificate Principal Balance of each such Class of
Certificates representing a regular interest in the Trust Fund would be reduced to zero,
which is, for each such regular interest, the Distribution Date in December, 2035, which is
the Distribution Date occurring in the month following the last scheduled monthly payment of
the Mortgage Loans.
Maximum Mortgage Loan Rate: With respect to the Class A, Class M and Class B
Certificates and any Interest Accrual Period, 14.00% per annum.
Maximum Mortgage Rate: With respect to any adjustable rate Mortgage Loan, the rate
indicated in Exhibit G hereto as the "NOTE CEILING," which rate is the maximum interest rate
that may be applicable to such adjustable rate Mortgage Loan at any time during the life of
such Mortgage Loan.
Maximum Net Mortgage Rate: With respect to any adjustable rate Mortgage Loan and any
date of determination, the Maximum Mortgage Rate minus the sum of (i) the Subservicing Fee
Rate and (ii) the Servicing Fee Rate and, as to any fixed rate Mortgage Loan and any class
of determination, the Net Mortgage Rate thereof.
MERS: Mortgage Electronic Registration Systems, Inc., a corporation organized and
existing under the laws of the State of Delaware, or any successor thereto.
MERS(R)System: The system of recording transfers of Mortgages electronically
maintained by MERS.
MIN: The Mortgage Identification Number for Mortgage Loans registered with MERS on
the MERS(R)System.
Minimum Mortgage Rate: With respect to any adjustable rate Mortgage Loan, the
greater of (i) the Note Margin and (ii) the rate indicated in Exhibit G hereto as the "NOTE
FLOOR", which rate may be applicable to such adjustable rate Mortgage Loan at any time
during the life of such adjustable rate Mortgage Loan and, as to any fixed rate Mortgage
Loan and any date of determination, the Net Mortgage Rate thereof..
Modified Mortgage Loan: Any Mortgage Loan that has been the subject of a Servicing
Modification.
Modified Mortgage Rate: With respect to any Mortgage Loan that is the subject of a
Servicing Modification, the Mortgage Rate, minus the rate per annum by which the Mortgage
Rate on such Mortgage Loan was reduced.
Modified Net Mortgage Rate: With respect to any Mortgage Loan that is the subject of
a Servicing Modification, the Net Mortgage Rate, minus the rate per annum by which the
Mortgage Rate on such Mortgage Loan was reduced.
MOM Loan: With respect to any Mortgage Loan, MERS acting as the mortgagee of such
Mortgage Loan, solely as nominee for the originator of such Mortgage Loan and its successors
and assigns, at the origination thereof.
Monthly Payment: With respect to any Mortgage Loan (including any REO Property) and
the Due Date in any Due Period, the payment of principal and interest due thereon in
accordance with the amortization schedule at the time applicable thereto (after adjustment,
if any, for Curtailments and for Deficient Valuations occurring prior to such Due Date but
before any adjustment to such amortization schedule by reason of any bankruptcy, other than
a Deficient Valuation, or similar proceeding or any moratorium or similar waiver or grace
period and before any Servicing Modification that constitutes a reduction of the interest
rate on such Mortgage Loan).
Moody's: ▇▇▇▇▇'▇ Investors Service, Inc., or its successor in interest.
Mortgage: With respect to each Mortgage Note related to a Mortgage Loan which is not
a Cooperative Loan, the mortgage, deed of trust or other comparable instrument creating a
first or junior lien on an estate in fee simple or leasehold interest in real property
securing a Mortgage Note.
Mortgage File: The mortgage documents listed in Section 2.01 pertaining to a
particular Mortgage Loan and any additional documents required to be added to the Mortgage
File pursuant to this Agreement.
Mortgage Loan Accrued Interest: With respect to each Neg Am Loan and each Due Date,
the aggregate amount of interest accrued at the Mortgage Rate in respect of such Mortgage
Loan since the preceding Due Date (or in the case of the initial Due Date, since the Cut-off
Date) to but not including such Due Date with respect to which the Mortgage Loan Accrued
Interest is being calculated in accordance with the terms of such Mortgage Loan, after
giving effect to any previous Principal Prepayments, Deficient Valuation or Debt Service
Reduction in respect of such Neg Am Loan.
Mortgage Loan Schedule: The lists of the Mortgage Loans attached hereto as Exhibit G
(as amended from time to time to reflect the addition of Qualified Substitute Mortgage
Loans), which lists shall set forth at a minimum the following information as to each
Mortgage Loan:
(i) the Mortgage Loan identifying number ("RFC LOAN #");
(ii) [reserved];
(iii) the maturity of the Mortgage Note ("MATURITY DATE" or "MATURITY DT")
for Mortgage Loans and if such Loan is a Balloon Loan, the amortization thereof;
(iv) the Mortgage Rate as of origination ("ORIG RATE");
(v) the Mortgage Rate as of the Cut-off Date for an adjustable rate
Mortgage Loan ("CURR RATE");
(vi) the Net Mortgage Rate as of the Cut-off Date ("CURR NET");
(vii) the scheduled monthly payment of principal, if any, and interest as of
the Cut-off Date ("ORIGINAL P & I" or "CURRENT P & I" for the adjustable rate
Mortgage Loans);
(viii) the Cut-off Date Principal Balance ("PRINCIPAL BAL");
(ix) the Loan-to-Value Ratio at origination ("LTV");
(x) a code "T", "BT" or "CT" under the column "LN FEATURE," indicating that
the Mortgage Loan is secured by a second or vacation residence (the absence of any
such code means the Mortgage Loan is secured by a primary residence);
(xi) a code "N" under the column "OCCP CODE", indicating that the Mortgage
Loan is secured by a non-owner occupied residence (the absence of any such code means
the Mortgage Loan is secured by an owner occupied residence);
(xii) the Maximum Mortgage Rate for the adjustable rate Mortgage Loans ("NOTE
CEILING");
(xiii) the Maximum Net Mortgage Rate for the adjustable rate Mortgage Loans
("NET CEILING");
(xiv) the Note Margin for the adjustable rate Mortgage Loans ("NOTE MARGIN");
(xv) the first Adjustment Date after the Cut-off Date for the adjustable
rate Mortgage Loans ("NXT INT CHG DT");
(xvi) the Periodic Cap for the adjustable rate Mortgage Loans ("PERIODIC
DECR" or "PERIODIC INCR"); and
(xvii) (the rounding of the semi-annual or annual adjustment to the Mortgage
Rate with respect to the adjustable rate Mortgage Loans ("NOTE METHOD").
Such schedules may consist of multiple reports that collectively set forth all of the
information required.
Mortgage Loans: Such of the mortgage loans transferred and assigned to the Trustee
pursuant to Section 2.01 as from time to time are held or deemed to be held as a part of the
Trust Fund, the Mortgage Loans originally so held being identified in the initial Mortgage
Loan Schedule, and Qualified Substitute Mortgage Loans held or deemed held as part of the
Trust Fund including, without limitation, each related Mortgage Note, Mortgage and Mortgage
File and all rights appertaining thereto.
Mortgage Note: The originally executed note or other evidence of indebtedness
evidencing the indebtedness of a Mortgagor under a Mortgage Loan, together with any
modification thereto.
Mortgage Rate: With respect to any Mortgage Loan, the interest rate borne by the
related Mortgage Note, or any modification thereto other than a Servicing Modification. The
Mortgage Rate on the adjustable rate Mortgage Loans will adjust on each Adjustment Date to
equal the sum (rounded to the nearest multiple of one-eighth of one percent (0.125%) or up
to the nearest one-eighth of one percent, which are indicated by a "U" on Exhibit G, except
in the case of the adjustable rate Mortgage Loans indicated by an "X" on Exhibit G or hereto
under the heading "NOTE METHOD"), of the related Index plus the Note Margin, in each case
subject to the applicable Periodic Cap, Maximum Mortgage Rate and Minimum Mortgage Rate.
Mortgaged Property: The underlying real property securing a Mortgage Loan or, with
respect to a Cooperative Loan, the related Cooperative Lease and Cooperative Stock.
Mortgagor: The obligor on a Mortgage Note.
Neg Am Loan: Any Mortgage Loan providing for negative amortization, as indicated in
the Mortgage Loan Schedule.
Net Mortgage Rate: With respect to any Mortgage Loan as of any date of
determination, a per annum rate equal to the Mortgage Rate for such Mortgage Loan as of such
date minus the sum of (i) the related Servicing Fee Rate and (ii) the related Subservicing
Fee Rate.
Net WAC Cap Rate: With respect to any Distribution Date and the Class A
Certificates, Class M Certificates or Class B Certificates, the product of (A) the weighted
average of the Net Mortgage Rates (or, if applicable, the Modified Net Mortgage Rates) on
the Mortgage Loans using the Net Mortgage Rates in effect for the Monthly Payments due on
such Mortgage Loans during the related Due Period, weighted on the basis of the respective
Stated Principal Balances thereof on the first day of the related Due Period and (B) a
fraction equal to 30 divided by the actual number of days in the related Interest Accrual
Period. For federal income tax purposes, however, clause (A) above shall be the equivalent
of that which is provided in such clause expressed as a per annum rate equal to the weighted
average of the Uncertificated REMIC I Pass-Through Rates on the REMIC I Regular Interests,
weighted on the basis of the Uncertificated Principal Balance of each such REMIC I Regular
Interest.
Net WAC Cap Shortfall: Any Class A Net WAC Cap Shortfall, Class M Net WAC Cap
Shortfall or Class B Net WAC Cap Shortfall.
Net WAC Cap Shortfall Carry-Forward Amount: Any Class A Net WAC Cap Shortfall
Carry-Forward Amount, Class M Net WAC Cap Shortfall Carry-Forward Amount or Class B Net WAC
Cap Shortfall Carry-Forward Amount.
Non-Primary Residence Loans: The Mortgage Loans designated as secured by second or
vacation residences, or by non-owner occupied residences, on the Mortgage Loan Schedule.
Non-United States Person: Any Person other than a United States Person.
Nonrecoverable Advance: Any Advance previously made or proposed to be made by the
Master Servicer or Subservicer in respect of a Mortgage Loan (other than a Deleted Mortgage
Loan) which, in the good faith judgment of the Master Servicer, will not, or, in the case of
a proposed Advance, would not, be ultimately recoverable by the Master Servicer from related
Late Collections, Insurance Proceeds, Liquidation Proceeds or REO Proceeds. To the extent
that any Mortgagor is not obligated under the related Mortgage documents to pay or reimburse
any portion of any Advances that are outstanding with respect to the related Mortgage Loan
as a result of a modification of such Mortgage Loan by the Master Servicer, which forgives
amounts which the Master Servicer or Subservicer had previously advanced, and the Master
Servicer determines that no other source of payment or reimbursement for such advances is
available to it, such Advances shall be deemed to be Nonrecoverable Advances. The
determination by the Master Servicer that it has made a Nonrecoverable Advance shall be
evidenced by an Officer's Certificate delivered to the Depositor, the Trustee and the Master
Servicer setting forth such determination, which shall include any other information or
reports obtained by the Master Servicer such as property operating statements, rent rolls,
property inspection reports and engineering reports, which may support such determinations.
Notwithstanding the above, the Trustee shall be entitled to rely upon any determination by
the Master Servicer that any Advance previously made is a Nonrecoverable Advance or that any
proposed Advance, if made, would constitute a Nonrecoverable Advance.
Nonsubserviced Mortgage Loan: Any Mortgage Loan that, at the time of reference
thereto, is not subject to a Subservicing Agreement.
Note Margin: With respect to each adjustable rate Mortgage Loan, the fixed
percentage set forth in the related Mortgage Note and indicated in Exhibit G hereto as the
"NOTE MARGIN," which percentage is added to the Index on each Adjustment Date to determine
(subject to rounding in accordance with the related Mortgage Note, the Periodic Cap, the
Maximum Mortgage Rate and the Minimum Mortgage Rate) the interest rate to be borne by such
adjustable rate Mortgage Loan until the next Adjustment Date.
Notional Amount: With respect to the Class SB Certificates or the REMIC II Regular
Interest SB-IO, immediately prior to any Distribution Date, the aggregate of the
Uncertificated Principal Balances of the REMIC I Regular Interests.
Officers' Certificate: A certificate signed by the Chairman of the Board, the
President, a Vice President, Assistant Vice President, Director, Managing Director, the
Treasurer, the Secretary, an Assistant Treasurer or an Assistant Secretary of the Depositor
or the Master Servicer, as the case may be, and delivered to the Trustee, as required by
this Agreement.
Opinion of Counsel: A written opinion of counsel acceptable to the Trustee and the
Master Servicer, who may be counsel for the Depositor or the Master Servicer, provided that
any opinion of counsel (i) referred to in the definition of "Disqualified Organization" or
(ii) relating to the qualification of REMIC I or REMIC II as REMICs or compliance with the
REMIC Provisions must, unless otherwise specified, be an opinion of Independent counsel.
Optional Termination Date: Any Distribution Date on or after which the Stated
Principal Balance (after giving effect to distributions to be made on such Distribution
Date) of the Mortgage Loans is less than 10.00% of the Cut-off Date Balance.
Outstanding Mortgage Loan: With respect to the Due Date in any Due Period, a
Mortgage Loan (including an REO Property) that was not the subject of a Principal Prepayment
in Full, Cash Liquidation or REO Disposition and that was not purchased, deleted or
substituted for prior to such Due Date pursuant to Section 2.02, 2.03, 2.04, 4.07 or 4.08.
Overcollateralization Amount: With respect to any Distribution Date, the excess, if
any, of (a) the aggregate Stated Principal Balance of the Mortgage Loans before giving
effect to distributions of principal to be made on such Distribution Date over (b) the
aggregate Certificate Principal Balance of the Class A and Class M Certificates as of such
date, before taking into account distributions of principal to be made on that Distribution
Date.
Overcollateralization Floor: An amount equal to the product of 0.50% and the Cut-off
Date Balance.
Overcollateralization Increase Amount: With respect to any Distribution Date, an
amount equal to the lesser of (i) the Excess Cash Flow for that Distribution Date available
to make payments pursuant to Section 4.02(c)(x) and (ii) the excess, if any, of (x) the
Required Overcollateralization Amount for that Distribution Date over (y) the
Overcollateralization Amount for that Distribution Date.
Overcollateralization Reduction Amount: With respect to any Distribution Date for
which the Excess Overcollateralization Amount is, or would be, after taking into account all
other distributions to be made on such Distribution Date, greater than zero, an amount equal
to the lesser of (i) the Excess Overcollateralization Amount for that Distribution Date and
(ii) the Principal Remittance Amount for such Distribution Date.
Ownership Interest: With respect to any Certificate, any ownership or security
interest in such Certificate, including any interest in such Certificate as the Holder
thereof and any other interest therein, whether direct or indirect, legal or beneficial, as
owner or as pledgee.
Pass-Through Rate: With respect to the Class A Certificates and each Interest
Accrual Period, a per annum rate equal to the least of (i) LIBOR plus the related Class A
Margin, (ii) the Maximum Mortgage Loan Rate and (iii) the Net WAC Cap Rate. With respect to
the Class M Certificates and each Interest Accrual Period, a per annum rate equal to the
least of (i) LIBOR plus the related Class M Margin, (ii) the Maximum Mortgage Loan Rate and
(iii) the Net WAC Cap Rate. With respect to the Class B Certificates and each Interest
Accrual Period, a per annum rate equal to the least of (i) LIBOR plus the related Class B
Margin, (ii) the Maximum Mortgage Loan Rate and (iii) the Net WAC Cap Rate.
With respect to the Class SB Certificates or the REMIC II Regular Interest SB-IO, a
per annum rate equal to the percentage equivalent of a fraction, the numerator of which is
(x) the sum, for each REMIC I Regular Interest, of the excess of the Uncertificated REMIC I
Pass-Through Rate for such REMIC I Regular Interest over the Marker Rate, applied to the
Uncertificated Notional Amount and the denominator of which is (y) the aggregate
Uncertificated Principal Balance of the REMIC I Regular Interests.
Paying Agent: JPMorgan Chase Bank, N.A., or any successor Paying Agent appointed by
the Trustee.
Percentage Interest: With respect to any Class A, Class M or Class B Certificate,
the undivided percentage ownership interest in the related Class evidenced by such
Certificate, which percentage ownership interest shall be equal to the Initial Certificate
Principal Balance thereof divided by the aggregate Initial Certificate Principal Balance of
all of the Certificates of the same Class. The Percentage Interest with respect to a Class
SB Certificate or Class R Certificate shall be stated on the face thereof.
Periodic Cap: With respect to each adjustable rate Mortgage Loan, the periodic rate
cap that limits the increase or the decrease of the related Mortgage Rate on any Adjustment
Date pursuant to the terms of the related Mortgage Note.
Permitted Investments: One or more of the following:
(i) obligations of or guaranteed as to principal and interest by the United
States or any agency or instrumentality thereof when such obligations are backed by
the full faith and credit of the United States;
(ii) repurchase agreements on obligations specified in clause (i) maturing
not more than one month from the date of acquisition thereof, provided that the
unsecured obligations of the party agreeing to repurchase such obligations are at the
time rated by each Rating Agency in its highest short-term rating available;
(iii) federal funds, certificates of deposit, demand deposits, time deposits
and bankers' acceptances (which shall each have an original maturity of not more than
90 days and, in the case of bankers' acceptances, shall in no event have an original
maturity of more than 365 days or a remaining maturity of more than 30 days)
denominated in United States dollars of any U.S. depository institution or trust
company incorporated under the laws of the United States or any state thereof or of
any domestic branch of a foreign depository institution or trust company; provided
that the debt obligations of such depository institution or trust company at the date
of acquisition thereof have been rated by each Rating Agency in its highest
short-term rating available; and, provided further that, if the original maturity of
such short-term obligations of a domestic branch of a foreign depository institution
or trust company shall exceed 30 days, the short-term rating of such institution
shall be A-1+ in the case of Standard & Poor's if Standard & Poor's is a Rating
Agency;
(iv) commercial paper and demand notes (having original maturities of not
more than 365 days) of any corporation incorporated under the laws of the United
States or any state thereof which on the date of acquisition has been rated by each
Rating Agency in its highest short-term rating available; provided that such
commercial paper and demand notes shall have a remaining maturity of not more than 30
days;
(v) a money market fund or a qualified investment fund rated by each Rating
Agency in its highest long-term rating available (which may be managed by the Trustee
or one of its Affiliates); and
(vi) other obligations or securities that are acceptable to each Rating
Agency as a Permitted Investment hereunder and will not reduce the rating assigned to
any Class of Certificates by such Rating Agency below the lower of the then-current
rating or the rating assigned to such Certificates as of the Closing Date by such
Rating Agency, as evidenced in writing;
provided, however, that no instrument shall be a Permitted Investment if it represents,
either (1) the right to receive only interest payments with respect to the underlying debt
instrument or (2) the right to receive both principal and interest payments derived from
obligations underlying such instrument and the principal and interest payments with respect
to such instrument provide a yield to maturity greater than 120% of the yield to maturity at
par of such underlying obligations. References herein to the highest rating available on
unsecured long-term debt shall mean AAA in the case of Standard & Poor's and 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 (assuming fully amortizing
collateral); (ii) the total amount of A-1 investments must not represent more than 20% of
the aggregate outstanding Certificate Principal Balance of the Certificates and each
investment must not mature beyond 30 days; (iii) the terms of the debt must have a
predetermined fixed dollar amount of principal due at maturity that cannot vary; and (iv) if
the investments may be liquidated prior to their maturity or are being relied on to meet a
certain yield, interest must be tied to a single interest rate index plus a single fixed
spread (if any) and must move proportionately with that index. Any Permitted Investment may
be purchased by or through the Trustee or its Affiliates.
Permitted Transferee: Any Transferee of a Class R Certificate, other than a
Disqualified Organization or Non-United States Person.
Person: Any individual, corporation, limited liability company, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization or government
or any agency or political subdivision thereof.
Pool Stated Principal Balance: With respect to any date of determination, the
aggregate of the Stated Principal Balances of each Mortgage Loan that was an Outstanding
Mortgage Loan on the Due Date immediately preceding the Due Period preceding such date of
determination.
Prepayment Assumption: With respect to the Class A, Class M and Class B
Certificates, the prepayment assumption to be used for determining the accrual of original
issue discount and premium and market discount on such Certificates for federal income tax
purposes, which assumes a prepayment rate of 23% HEP with respect to the fixed-rate Mortgage
Loans, and 100% PPV with respect to the adjustable-rate Mortgage Loans.
Prepayment Interest Shortfall: With respect to any Distribution Date and any
Mortgage Loan (other than a Mortgage Loan relating to an REO Property) that was the subject
of (a) a Principal Prepayment in Full during the related Prepayment Period, an amount equal
to the excess of one month's interest at the related Net Mortgage Rate (or Modified Net
Mortgage Rate in the case of a Modified Mortgage Loan) on the Stated Principal Balance of
such Mortgage Loan over the amount of interest (adjusted to the related Net Mortgage Rate
(or Modified Net Mortgage Rate in the case of a Modified Mortgage Loan)) paid by the
Mortgagor for such Prepayment Period to the date of such Principal Prepayment in Full or (b)
a Curtailment during the prior calendar month, an amount equal to one month's interest at
the related Net Mortgage Rate (or Modified Net Mortgage Rate in the case of a Modified
Mortgage Loan) on the amount of such Curtailment.
Prepayment Period: With respect to any Distribution Date, the calendar month
preceding the month of distribution.
Primary Insurance Policy: Each primary policy of mortgage guaranty insurance as
indicated by a numeric code on Exhibit G with the exception of either code "23" or "96"
under the column "MI CO CODE".
Principal Distribution Amount: With respect to any Distribution Date, the lesser of
(a) the excess of (i) the sum of (x) the Available Distribution Amount for such Distribution
Date, plus (y) for inclusion in Excess Cash Flow for purposes of clauses (b)(v) and (b)(vi),
the Yield Maintenance Agreement Principal Distributable Amount for such Distribution Date to
the extent set forth in Sections 4.02(c)(x) and 4.02(c)(xi) over (ii) the Interest
Distribution Amount and (b) the sum of:
(i) the principal portion of each Monthly Payment received or Advanced with
respect to the related Due Period on each Outstanding Mortgage Loan;
(ii) the Stated Principal Balance of any Mortgage Loan repurchased during
the related Prepayment Period (or deemed to have been so repurchased in accordance
with Section 3.07(b)) pursuant to Section 2.02, 2.03, 2.04, 4.07 or 4.08, the amount
of any shortfall deposited in the Custodial Account in connection with the
substitution of a Deleted Mortgage Loan pursuant to Section 2.03 or 2.04 during the
related Prepayment Period and the Stated Principal Balance of Mortgage Loans
purchased pursuant to Section 9.01 in connection with such Distribution Date, if
applicable;
(iii) the principal portion of all other unscheduled collections, other than
Subsequent Recoveries, on the Mortgage Loans (including, without limitation,
Principal Prepayments in Full, Curtailments, Insurance Proceeds, Liquidation Proceeds
and REO Proceeds) received during the related Prepayment Period to the extent applied
by the Master Servicer as recoveries of principal of the Mortgage Loans pursuant to
Section 3.14;
(iv) the lesser of (a) Subsequent Recoveries for such Distribution Date and
(b) the principal portion of any Realized Losses allocated to any Class of
Certificates on a prior Distribution Date and remaining unreimbursed;
(v) the lesser of (a) Excess Cash Flow for that Distribution Date (to the
extent not used pursuant to clause (iv) of this definition on such Distribution Date)
and (b) the principal portion of any Realized Losses incurred (or deemed to have been
incurred) on any Mortgage Loans in the calendar month preceding such Distribution
Date to the extent covered by Excess Cash Flow for that Distribution Date; and
(vi) the lesser of (a) the Excess Cash Flow for such Distribution Date (to
the extent not used to cover Realized Losses pursuant to clause (iv) and (v) of this
definition on such Distribution Date) and (b) the Overcollateralization Increase
Amount (without giving effect to Section 4.02(c)(xvii)) for such Distribution Date to
the extent covered by Excess Cash Flow for that Distribution Date;
minus
(vii) the amount of any Overcollateralization Reduction Amount for such
Distribution Date;
(viii) the amount of any Deferred Interest paid out of principal collections
on the Mortgage Loans as part of the Class A, Class M-1, Class M-2, Class M-3, Class
M-4, Class M-5 and Class B Interest Distribution Amounts, as applicable, for that
Distribution Date; and
(ix) the amount of any Capitalization Reimbursement Amount for such
Distribution Date;
provided, however, that the Principal Distribution Amount on any Distribution Date shall not
be less than zero or greater than the aggregate Certificate Principal Balance of the Class
A, Class M and Class B Certificates.
Principal Prepayment: Any payment of principal or other recovery on a Mortgage Loan,
including a recovery that takes the form of Liquidation Proceeds or Insurance Proceeds,
which is received in advance of its scheduled Due Date and is not accompanied by an amount
as to interest representing scheduled interest on such payment due on any date or dates in
any month or months subsequent to the month of prepayment.
Principal Prepayment in Full: Any Principal Prepayment made by a Mortgagor of the
entire principal balance of a Mortgage Loan.
Principal Remittance Amount: With respect to any Distribution Date, the sum of the
amounts described in clauses (b)(i), (b)(ii) and (b)(iii) of the definition of Principal
Distribution Amount for that Distribution Date.
Program Guide: The Residential Funding Seller Guide for mortgage collateral sellers
that participate in Residential Funding's standard mortgage programs, and Residential
Funding's Servicing Guide and any other subservicing arrangements which Residential Funding
has arranged to accommodate the servicing of the Mortgage Loans.
Purchase Price: With respect to any Mortgage Loan (or REO Property) required to be
or otherwise purchased on any date pursuant to Section 2.02, 2.03, 2.04, 4.07 or 4.08, an
amount equal to the sum of (i) (a) if such Mortgage Loan (or REO Property) is being
purchased pursuant to Sections 2.02, 2.03, 2.04 or 4.07 of this Agreement, 100% of the
Stated Principal Balance thereof plus the principal portion of any related unreimbursed
Advances or (b) if such Mortgage Loan (or REO Property) is being purchased pursuant to
Section 4.08 of this Agreement, the greater of (1) 100% of the Stated Principal Balance
thereof plus the principal portion of any related unreimbursed Advances on such Mortgage
Loan (or REO Property) and (2) the fair market value thereof plus the principal portion of
any related unreimbursed Advances and (ii) unpaid accrued interest at the Adjusted Mortgage
Rate (or Modified Net Mortgage Rate in the case of a Modified Mortgage Loan) plus the rate
per annum at which the Servicing Fee is calculated, or (b) in the case of a purchase made by
the Master Servicer, at the Net Mortgage Rate (or Modified Net Mortgage Rate in the case of
a Modified Mortgage Loan), in each case on the Stated Principal Balance thereof to, but not
including, the first day of the month following the month of purchase from the Due Date to
which interest was last paid by the Mortgagor.
Qualified Insurer: A mortgage guaranty insurance company duly qualified as such
under the laws of the state of its principal place of business and each state having
jurisdiction over such insurer in connection with the insurance policy issued by such
insurer, duly authorized and licensed in such states to transact a mortgage guaranty
insurance business in such states and to write the insurance provided by the insurance
policy issued by it, approved as a FNMA- or FHLMC-approved mortgage insurer or having a
claims paying ability rating of at least "AA" or equivalent rating by a nationally
recognized statistical rating organization. Any replacement insurer with respect to a
Mortgage Loan must have at least as high a claims paying ability rating as the insurer it
replaces had on the Closing Date.
Qualified Substitute Mortgage Loan: A Mortgage Loan substituted by Residential
Funding or the Depositor for a Deleted Mortgage Loan which must, on the date of such
substitution, as confirmed in an Officers' Certificate delivered to the Trustee, (i) have an
outstanding principal balance, after deduction of the principal portion of the monthly
payment due in the month of substitution (or in the case of a substitution of more than one
Mortgage Loan for a Deleted Mortgage Loan, an aggregate outstanding principal balance, after
such deduction), not in excess of the Stated Principal Balance of the Deleted Mortgage Loan
(the amount of any shortfall to be deposited by Residential Funding, in the Custodial
Account in the month of substitution); (ii) have a Mortgage Rate and a Net Mortgage Rate no
lower than and not more than 1% per annum higher than the Mortgage Rate and Net Mortgage
Rate, respectively, of the Deleted Mortgage Loan as of the date of substitution; (iii) have
a Loan-to-Value Ratio at the time of substitution no higher than that of the Deleted
Mortgage Loan at the time of substitution; (iv) have a remaining term to stated maturity not
greater than (and not more than one year less than) that of the Deleted Mortgage Loan; (v)
comply with each representation and warranty set forth in Sections 2.03 and 2.04 hereof and
Section 4 of the Assignment Agreement; and (vi) in the case of the adjustable rate Mortgage
Loans, (w) have a Mortgage Rate that adjusts with the same frequency and based upon the same
Index as that of the Deleted Mortgage Loan, (x) have a Note Margin not less than that of the
Deleted Mortgage Loan; (y) have a Periodic Rate Cap that is equal to that of the Deleted
Mortgage Loan; and (z) have a next Adjustment Date no later than that of the Deleted
Mortgage Loan.
Rating Agency: ▇▇▇▇▇'▇, Standard & Poor's and Fitch. If any agency or a successor is
no longer in existence, "Rating Agency" shall be such statistical credit rating agency, or
other comparable Person, designated by the Depositor, notice of which designation shall be
given to the Trustee and the Master Servicer.
Realized Loss: With respect to each Mortgage Loan (or REO Property) as to which a
Cash Liquidation or REO Disposition has occurred, an amount (not less than zero) equal to
(i) the Stated Principal Balance of the Mortgage Loan (or REO Property) as of the date of
Cash Liquidation or REO Disposition, plus (ii) interest (and REO Imputed Interest, if any)
at the Net Mortgage Rate (or Modified Net Mortgage Rate in the case of a Modified Mortgage
Loan) from the Due Date as to which interest was last paid or advanced to Certificateholders
up to the last day of the month in which the Cash Liquidation (or REO Disposition) occurred
on the Stated Principal Balance of such Mortgage Loan (or REO Property) outstanding during
each Due Period that such interest was not paid or advanced to the extent, with respect to
Negative Amortization Loans, such interest does not constitute Deferred Interest that has
been added to the principal balance of such Mortgage Loan, minus (iii) the proceeds, if any,
received during the month in which such Cash Liquidation (or REO Disposition) occurred, to
the extent applied as recoveries of interest at the Net Mortgage Rate (or Modified Net
Mortgage Rate in the case of a Modified Mortgage Loan) and to principal of the Mortgage
Loan, net of the portion thereof reimbursable to the Master Servicer or any Subservicer with
respect to related Advances, Servicing Advances or other expenses as to which the Master
Servicer or Subservicer is entitled to reimbursement thereunder but which have not been
previously reimbursed. With respect to each Mortgage Loan which is the subject of a
Servicing Modification, (a) (1) the amount by which the interest portion of a Monthly
Payment or the principal balance of such Mortgage Loan was reduced or (2) the sum of any
other amounts owing under the Mortgage Loan that were forgiven and that constitute Servicing
Advances that are reimbursable to the Master Servicer or a Subservicer, and (b) any such
amount with respect to a Monthly Payment that was or would have been due in the month
immediately following the month in which a Principal Prepayment or the Purchase Price of
such Mortgage Loan is received or is deemed to have been received. With respect to each
Mortgage Loan which has become the subject of a Deficient Valuation, the difference between
the principal balance of the Mortgage Loan outstanding immediately prior to such Deficient
Valuation and the principal balance of the Mortgage Loan as reduced by the Deficient
Valuation. With respect to each Mortgage Loan which has become the object of a Debt Service
Reduction, the amount of such Debt Service Reduction. Notwithstanding the above, neither a
Deficient Valuation nor a Debt Service Reduction shall be deemed a Realized Loss hereunder
so long as the Master Servicer has notified the Trustee in writing that the Master Servicer
is diligently pursuing any remedies that may exist in connection with the representations
and warranties made regarding the related Mortgage Loan and either (A) the related Mortgage
Loan is not in default with regard to payments due thereunder or (B) delinquent payments of
principal and interest under the related Mortgage Loan and any premiums on any applicable
primary hazard insurance policy and any related escrow payments in respect of such Mortgage
Loan are being advanced on a current basis by the Master Servicer or a Subservicer, in
either case without giving effect to any Debt Service Reduction.
To the extent the Master Servicer receives Subsequent Recoveries with respect to any
Mortgage Loan, the amount of the Realized Loss with respect to that Mortgage Loan will be
reduced to the extent such recoveries are applied to reduce the Certificate Principal
Balance of any Class of Certificates on any Distribution Date.
Realized Losses allocated to the Class SB Certificates shall be allocated first to
the REMIC II Regular Interest SB-IO in reduction of the accrued but unpaid interest thereon
until such accrued and unpaid interest shall have been reduced to zero and then to the
REMIC II Regular Interest SB-PO in reduction of the Principal Balance thereof.
Record Date: With respect to each Distribution Date and the Class A Certificates,
Class M and Class B Certificates which are Book-Entry Certificates, the close of business on
the Business Day prior to such Distribution Date.
With respect to each Distribution Date and the Certificates (other than the Class A,
Class M and Class B Certificates), the close of business on the last Business Day of the
month next preceding the month in which the related Distribution Date occurs, except in the
case of the first Record Date, which shall be the Closing Date.
Reference Bank Rate: As defined in Section 1.02.
Regular Interest: Any one of the regular interests in the Trust Fund.
Relief Act: The Servicemembers Civil Relief Act, as amended.
Relief Act Shortfalls: Interest shortfalls on the Mortgage Loans resulting from the
Relief Act or similar legislation or regulations.
REMIC: A "real estate mortgage investment conduit" within the meaning of Section
860D of the Code.
REMIC Administrator: Residential Funding Corporation. If Residential Funding
Corporation is found by a court of competent jurisdiction to no longer be able to fulfill
its obligations as REMIC Administrator under this Agreement the Master Servicer or Trustee
acting as successor master servicer shall appoint a successor REMIC Administrator, subject
to assumption of the REMIC Administrator obligations under this Agreement.
REMIC I: The segregated pool of assets subject hereto (exclusive of the Yield
Maintenance Agreement and any payments thereunder, which are not assets of any REMIC),
constituting a portion of the primary trust created hereby and to be administered hereunder,
with respect to which a separate REMIC election is to be made (other than with respect to
the items in clause (v) and the proceeds thereof), consisting of: (i) the Mortgage Loans
and the related Mortgage Files; (ii) all payments on and collections in respect of the
Mortgage Loans due after the Cut-off Date (other than Monthly Payments due in the month of
the Cut-off Date) as shall be on deposit in the Custodial Account or in the Certificate
Account and identified as belonging to the Trust Fund; (iii) property which secured a
Mortgage Loan and which has been acquired for the benefit of the Certificateholders by
foreclosure or deed in lieu of foreclosure; (iv) the hazard insurance policies and Primary
Insurance Policies pertaining to the Mortgage Loans, if any; and (v) all proceeds of clauses
(i) through (iv) above.
REMIC I Regular Interest: Any of the separate non-certificated beneficial ownership
interests in REMIC I issued hereunder and designated as a "regular interest" in REMIC I.
Each REMIC I Regular Interest shall accrue interest at the related Uncertificated REMIC I
Pass-Through Rate in effect from time to time, and shall be entitled to distributions of
principal, subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary Statement hereto.
The designations for the respective REMIC I Regular Interests are set forth in the
Preliminary Statement hereto.
REMIC I Interest Loss Allocation Amount: With respect to any Distribution Date, an
amount equal to (a) the product of (i) the aggregate Uncertificated Principal Balance of the
REMIC I Regular Interests then outstanding and (ii) the Uncertificated Pass-Through Rate for
REMIC I Regular Interest AA minus the Marker Rate, divided by (b) 12.
REMIC I Overcollateralized Amount: With respect to any date of determination, (i) 1%
of the aggregate Uncertificated Principal Balances of the REMIC I Regular Interests minus
(ii) the aggregate Uncertificated Principal Balances of the REMIC I Regular Interests (other
than REMIC I Regular Interests AA and ZZ), in each case as of such date of determination.
REMIC I Principal Loss Allocation Amount: With respect to any Distribution Date, an
amount equal to the product of (i) the aggregate Stated Principal Balance of the Mortgage
Loans then outstanding and (ii) 1 minus a fraction, the numerator of which is two times the
sum of the Uncertificated Principal Balances of REMIC I Regular Interests ▇-▇, ▇-▇, ▇-▇,
▇-▇, ▇-▇, ▇-▇, ▇-▇, M-5 and B and the denominator of which is the sum of the Uncertificated
Principal Balances of ▇-▇, ▇-▇, ▇-▇, ▇-▇, ▇-▇, ▇-▇, ▇-▇, ▇-▇, ▇, and ZZ.
REMIC I Regular Interest AA: A regular interest in REMIC I that is held as an asset
of REMIC II, that has an initial principal balance equal to the related Uncertificated
Principal Balance, that bears interest at the related Uncertificated REMIC I Pass-Through
Rate, and that has such other terms as are described herein.
REMIC I Regular Interest A-1: A regular interest in REMIC I that is held as an asset
of REMIC II, that has an initial principal balance equal to the related Uncertificated
Principal Balance, that bears interest at the related Uncertificated REMIC I Pass-Through
Rate, and that has such other terms as are described herein.
REMIC I Regular Interest A-2: A regular interest in REMIC I that is held as an asset
of REMIC II, that has an initial principal balance equal to the related Uncertificated
Principal Balance, that bears interest at the related Uncertificated REMIC I Pass-Through
Rate, and that has such other terms as are described herein.
REMIC I Regular Interest A-3: A regular interest in REMIC I that is held as an asset
of REMIC II, that has an initial principal balance equal to the related Uncertificated
Principal Balance, that bears interest at the related Uncertificated REMIC I Pass-Through
Rate, and that has such other terms as are described herein.
REMIC I Regular Interest B: A regular interest in REMIC I that is held as an asset
of REMIC II, that has an initial principal balance equal to the related Uncertificated
Principal Balance, that bears interest at the related Uncertificated REMIC I Pass-Through
Rate, and that has such other terms as are described herein.
REMIC I Regular Interest M-1: A regular interest in REMIC I that is held as an asset
of REMIC II, that has an initial principal balance equal to the related Uncertificated
Principal Balance, that bears interest at the related Uncertificated REMIC I Pass-Through
Rate, and that has such other terms as are described herein.
REMIC I Regular Interest M-2: A regular interest in REMIC I that is held as an asset
of REMIC II, that has an initial principal balance equal to the related Uncertificated
Principal Balance, that bears interest at the related Uncertificated REMIC I Pass-Through
Rate, and that has such other terms as are described herein.
REMIC I Regular Interest M-3: A regular interest in REMIC I that is held as an asset
of REMIC II, that has an initial principal balance equal to the related Uncertificated
Principal Balance, that bears interest at the related Uncertificated REMIC I Pass-Through
Rate, and that has such other terms as are described herein.
REMIC I Regular Interest M-4: A regular interest in REMIC I that is held as an asset
of REMIC II, that has an initial principal balance equal to the related Uncertificated
Principal Balance, that bears interest at the related Uncertificated REMIC I Pass-Through
Rate, and that has such other terms as are described herein.
REMIC I Regular Interest M-5: A regular interest in REMIC I that is held as an asset
of REMIC II, that has an initial principal balance equal to the related Uncertificated
Principal Balance, that bears interest at the related Uncertificated REMIC I Pass-Through
Rate, and that has such other terms as are described herein.
REMIC I Regular Interest ZZ: A regular interest in REMIC I that is held as an asset
of REMIC II, that has an initial principal balance equal to the related Uncertificated
Principal Balance, that bears interest at the related Uncertificated REMIC I Pass-Through
Rate, and that has such other terms as are described herein.
REMIC I Regular Interest ZZ Maximum Interest Deferral Amount: With respect to any
Distribution Date, the excess of (i) Uncertificated Accrued Interest calculated with the
REMIC I Regular Interest ZZ Uncertificated Pass-Through Rate and an Uncertificated Principal
Balance equal to the excess of (x) the Uncertificated Principal Balance of REMIC I Regular
Interest ZZ over (y) the REMIC I Overcollateralized Amount, in each case for such
Distribution Date, over (ii) the sum of Uncertificated Accrued Interest on REMIC I Regular
Interest A-1 through REMIC I Regular Interest M-10, with the rate on each such REMIC I
Regular Interest subject to a cap equal to the Pass-Through Rate for the corresponding Class
for the purpose of this calculation.
REMIC II: The segregated pool of assets described in the Preliminary Statement.
REMIC II Regular Interest: Any "regular interest" issued by REMIC II the ownership
of which is evidenced by a Class A Certificate, Class M Certificate, Class B Certificate or
the Class SB Certificate.
REMIC II Regular Interest SB-IO: A separate non-certificated regular interest of
REMIC II designated as a REMIC II Regular Interest. REMIC II Regular Interest SB-IO shall
have no entitlement to principal and shall be entitled to distributions of interest subject
to the terms and conditions hereof, in an aggregate amount equal to interest distributable
with respect to the Class SB Certificates pursuant to the terms and conditions hereof.
REMIC II Regular Interest SB-PO: A separate non-certificated regular interest of
REMIC II designated as a REMIC II Regular Interest. REMIC II Regular Interest SB-PO shall
have no entitlement to interest and shall be entitled to distributions of principal subject
to the terms and conditions hereof, in an aggregate amount equal to principal distributable
with respect to the Class SB Certificates pursuant to the terms and conditions hereof.
REMIC Provisions: Provisions of the federal income tax law relating to real estate
mortgage investment conduits, which appear at Sections 860A through 860G of Subchapter M of
Chapter 1 of the Code, and related provisions, and temporary and final regulations (or, to
the extent not inconsistent with such temporary or final regulations, proposed regulations)
and published rulings, notices and announcements promulgated thereunder, as the foregoing
may be in effect from time to time.
REMIC Regular Interests: the REMIC I Regular Interests and REMIC II Regular
Interests.
REO Acquisition: The acquisition by the Master Servicer on behalf of the Trustee for
the benefit of the Certificateholders of any REO Property pursuant to Section 3.14.
REO Disposition: With respect to any REO Property, a determination by the Master
Servicer that it has received substantially all Insurance Proceeds, Liquidation Proceeds,
REO Proceeds and other payments and recoveries (including proceeds of a final sale) which
the Master Servicer expects to be finally recoverable from the sale or other disposition of
the REO Property.
REO Imputed Interest: With respect to any REO Property, for any period, an amount
equivalent to interest (at a rate equal to the sum of the Net Mortgage Rate that would have
been applicable to the related Mortgage Loan had it been outstanding net of amounts that
would have been Deferred Interest, if any) on the unpaid principal balance of the Mortgage
Loan as of the date of acquisition thereof for such period.
REO Proceeds: Proceeds, net of expenses, received in respect of any REO Property
(including, without limitation, proceeds from the rental of the related Mortgaged Property)
which proceeds are required to be deposited into the Custodial Account only upon the related
REO Disposition.
REO Property: A Mortgaged Property acquired by the Master Servicer, on behalf of the
Trust Fund for the benefit of the Certificateholders pursuant to Section 3.14, through
foreclosure or deed in lieu of foreclosure in connection with a defaulted Mortgage Loan.
Reportable Modified Mortgage Loan: Any Mortgage Loan that (i) has been subject to an
interest rate reduction, (ii) has been subject to a term extension or (iii) has had amounts
owing on such Mortgage Loan capitalized by adding such amount to the Stated Principal
Balance of such Mortgage Loan; provided, however, that a Mortgage Loan modified in
accordance with clause (i) above for a temporary period shall not be a Reportable Modified
Mortgage Loan if such Mortgage Loan has not been delinquent in payments of principal and
interest for six months since the date of such modification if that interest rate reduction
is not made permanent thereafter.
Repurchase Event: As defined in the Assignment Agreement.
Request for Release: A request for release, the form of which is attached as Exhibit
H hereto, or an electronic request in a form acceptable to the Custodian.
Required Insurance Policy: With respect to any Mortgage Loan, any insurance policy
which is required to be maintained from time to time under this Agreement, the Program Guide
or the related Subservicing Agreement in respect of such Mortgage Loan.
Required Overcollateralization Amount: With respect to any Distribution Date, (a) if
such Distribution Date is prior to the Stepdown Date, the sum of 1.30% of the aggregate
Stated Principal Balance of the mortgage loans as of the cut-off date and an amount equal to
the cumulative amount applied in payment of principal to the Class M-5 Certificates and
Class B Certificates on previous Distribution Dates pursuant to Section 4.02(c)(xvii), or
(b) if such Distribution Date is on or after the related Stepdown Date, the greater of (i)
the excess of (1) 5.60% of the then current aggregate Stated Principal Balance of the
mortgage loans as of the end of the Due Period over (2) the Certificate Principal Balance of
the Class M-5 and Class B Certificates, or (ii) the Overcollateralization Floor.
Notwithstanding the foregoing, if a Trigger Event is in effect on any Distribution Date, the
Required Overcollateralization Amount shall equal the Required Overcollateralization Amount
on the Distribution Date immediately preceding the occurrence of the Trigger Event plus the
amount applied as payment of principal to the Class M-5 Certificates and Class B
Certificates on such preceding Distribution Date pursuant to Section 4.02(c)(xvii). The
Required Overcollateralization Amount may be reduced with prior written confirmation from
each of the Rating Agencies that such reduction will not result in a reduction or withdrawal
of the then current rating of any class of the Certificates.
Residential Funding: Residential Funding Corporation, a Delaware corporation, in its
capacity as seller of the Mortgage Loans to the Depositor and not in its capacity as Master
Servicer, and any successor thereto.
Responsible Officer: When used with respect to the Trustee, any officer of the
Corporate Trust Department of the Trustee, including any Senior Vice President, any Vice
President, any Assistant Vice President, any Assistant Secretary, any Trust Officer or
Assistant Trust Officer, or any other officer of the Trustee in each case with direct
responsibility for the administration of this Agreement.
RFC Exemption: As defined in Section 5.02(e)(ii).
Rule 144A: Rule 144A under the Securities Act of 1933, as in effect from time to
time.
Security Agreement: With respect to a Cooperative Loan, the agreement creating a
security interest in favor of the originator in the related Cooperative Stock.
Senior Enhancement Percentage: For any Distribution Date, the percentage obtained by
dividing (x) the sum of (i) the aggregate Certificate Principal Balance of the Class M and
Class B Certificates and (ii) the Overcollateralization Amount, in each case prior to the
distribution of the Principal Distribution Amount on such Distribution Date, by (y) the
aggregate Stated Principal Balance of the Mortgage Loans after giving effect to
distributions to be made on that Distribution Date.
Servicing Accounts: The account or accounts created and maintained pursuant to
Section 3.08.
Servicing Advances: All customary, reasonable and necessary "out of pocket" costs
and expenses incurred in connection with a default, delinquency or other unanticipated event
by the Master Servicer or a Subservicer in the performance of its servicing obligations,
including, but not limited to, the cost of (i) the preservation, restoration and protection
of a Mortgaged Property, or, with respect to a Cooperative Loan, the related Cooperative
Apartment (ii) any enforcement or judicial proceedings, including foreclosures, including
any expenses incurred in relation to any such proceedings that result from the Mortgage Loan
being registered on the MERS System, (iii) the management and liquidation of any REO
Property, (iv) any mitigation procedures implemented in accordance with Section 3.07 and (v)
compliance with the obligations under Sections 3.01, 3.08, 3.11, 3.12(a) and 3.14,
including, if the Master Servicer or any Affiliate of the Master Servicer provides services
such as appraisals and brokerage services that are customarily provided by Persons other
than servicers of mortgage loans, reasonable compensation for such services.
Servicing Fee: With respect to any Mortgage Loan and Distribution Date, the fee
payable monthly to the Master Servicer in respect of master servicing compensation that
accrues at an annual rate equal to the Servicing Fee Rate multiplied by the Stated Principal
Balance of such Mortgage Loan as of the related Due Date in the related Due Period, as may
be adjusted pursuant to Section 3.16(e).
Servicing Fee Rate: With respect to any Mortgage Loan, the per annum rate designated
on the Mortgage Loan Schedule as the "MSTR SERV FEE" as may be adjusted with respect to
successor Master Servicers as provided in Section 7.02, which rate shall never be greater
than the Mortgage Rate of such Mortgage Loan.
Servicing Modification: Any reduction of the interest rate on or the Stated
Principal Balance of a Mortgage Loan, any extension of the final maturity date of a Mortgage
Loan, and any increase to the Stated Principal Balance of a Mortgage Loan by adding to the
Stated Principal Balance unpaid principal and interest and other amounts owing under the
Mortgage Loan, in each case pursuant to a modification of a Mortgage Loan that is in
default, or for which, in the judgment of the Master Servicer, default is reasonably
foreseeable in accordance with Section 3.07(a).
Servicing Officer: Any officer of the Master Servicer involved in, or responsible
for, the administration and servicing of the Mortgage Loans whose name and specimen
signature appear on a list of servicing officers furnished to the Trustee on the Closing
Date by the Master Servicer, as such list may from time to time be amended.
Sixty-Plus Delinquency Percentage: With respect to any Distribution Date the
fraction, expressed as a percentage, equal to (x) the aggregate Stated Principal Balance of
the Mortgage Loans that are 60 or more days delinquent in payment of principal and interest
for that Distribution Date, including Mortgage Loans in foreclosure and REO Properties, over
(y) the aggregate Stated Principal Balance of all of the Mortgage Loans immediately
preceding that Distribution Date.
Standard & Poor's: Standard & Poor's Rating Services, a division of The ▇▇▇▇▇▇-▇▇▇▇
Companies, Inc. or its successors in interest.
Startup Date: The day designated as such pursuant to Article X hereof.
Stated Principal Balance: With respect to any Mortgage Loan or related REO Property,
at any given time, (i) the sum of (a) the Cut-off Date Principal Balance of the Mortgage
Loan, (b) any Deferred Interest added to the principal balance of the Mortgage Loan pursuant
to the terms of the Mortgage Note, (c) any amount by which the Stated Principal Balance of
the Mortgage Loan has been increased pursuant to a Servicing Modification, minus (ii) the
sum of (a) the principal portion of the Monthly Payments due with respect to such Mortgage
Loan or REO Property during each Due Period commencing on the first Due Period after the
Cut-Off Date and ending with the Due Period related to the most recent Distribution Date
which were received or with respect to which an Advance was made, and (b) all Principal
Prepayments with respect to such Mortgage Loan or REO Property, and all Insurance Proceeds,
Liquidation Proceeds and REO Proceeds, to the extent applied by the Master Servicer as
recoveries of principal in accordance with Section 3.14 with respect to such Mortgage Loan
or REO Property, in each case which were distributed pursuant to Section 4.02 or 4.03 on any
previous Distribution Date, and (c) any Realized Loss incurred with respect to such Mortgage
Loan allocated to Certificateholders with respect thereto for any previous Distribution Date.
Stepdown Date: The Distribution Date which is the later to occur of (x) the
Distribution Date in January 2009 and (y) the first Distribution Date on which the aggregate
Stated Principal Balance of the mortgage loans as of the end of the related Due Period is
less than one-half of the aggregate Cut-off Date Principal Balance.
Subordination: The provisions described in Section 4.05 relating to the allocation
of Realized Losses.
Subordination Percentage: With respect to the Class A Certificates, 76.20%; with
respect to the Class M-1 Certificates, 84.90%; with respect to the Class M-2 Certificates,
91.00%; with respect to the Class M-3 Certificates, 93.40%; with respect to the Class M-4
Certificates, 94.40%; with respect to the Class M-5 Certificates, 96.40%; and with respect
to the Class B Certificates, 97.40%.
Subsequent Recoveries: As of any Distribution Date, amounts received by the Master
Servicer (net of any related expenses permitted to be reimbursed pursuant to Section 3.10)
or surplus amounts held by the Master Servicer to cover estimated expenses (including, but
not limited to, recoveries in respect of the representations and warranties made by the
related Seller pursuant to the applicable Seller's Agreement and assigned to the Trustee
pursuant to Section 2.04) specifically related to a Mortgage Loan that was the subject of a
Cash Liquidation or an REO Disposition prior to the related Prepayment Period and that
resulted in a Realized Loss.
Subserviced Mortgage Loan: Any Mortgage Loan that, at the time of reference thereto,
is subject to a Subservicing Agreement.
Subservicer: Any Person with whom the Master Servicer has entered into a
Subservicing Agreement and who generally satisfied the requirements set forth in the Program
Guide in respect of the qualification of a Subservicer as of the date of its approval as a
Subservicer by the Master Servicer.
Subservicer Advance: Any delinquent installment of principal and interest on a
Mortgage Loan which is advanced by the related Subservicer (net of its Subservicing Fee)
pursuant to the Subservicing Agreement.
Subservicing Account: An account established by a Subservicer in accordance with
Section 3.08.
Subservicing Agreement: The written contract between the Master Servicer and any
Subservicer relating to servicing and administration of certain Mortgage Loans as provided
in Section 3.02, generally in the form of the servicer contract referred to or contained in
the Program Guide or in such other form as has been approved by the Master Servicer and the
Depositor.
Subservicing Fee: With respect to any Mortgage Loan, the fee payable monthly to the
related Subservicer (or, in the case of a Nonsubserviced Mortgage Loan, to the Master
Servicer) in respect of subservicing and other compensation that accrues with respect to
each Distribution Date at an annual rate equal to the Subservicing Fee Rate multiplied by
the Stated Principal Balance of such Mortgage Loan as of the related Due Date in the related
Due Period.
Subservicing Fee Rate: The per annum rate designated on the Mortgage Loan Schedule
as the "SUBSERV FEE".
Tax Returns: The federal income tax return on Internal Revenue Service Form 1066,
U.S. Real Estate Mortgage Investment Conduit Income Tax Return, including Schedule Q
thereto, Quarterly Notice to Residual Interest Holders of REMIC Taxable Income or Net Loss
Allocation, or any successor forms, to be filed on behalf of any REMIC due to its
classification as a REMIC under the REMIC Provisions, together with any and all other
information, reports or returns that may be required to be furnished to the
Certificateholders or filed with the Internal Revenue Service or any other governmental
taxing authority under any applicable provisions of federal, state or local tax laws.
Telerate Screen Page 3750: As defined in Section 1.02.
Transfer: Any direct or indirect transfer, sale, pledge, hypothecation or other form
of assignment of any Ownership Interest in a Certificate.
Transferee: Any Person who is acquiring by Transfer any Ownership Interest in a
Certificate.
Transferor: Any Person who is disposing by Transfer of any Ownership Interest in a
Certificate.
Trigger Event: A Trigger Event is in effect with respect to any Distribution Date if
either (i) with respect to any Distribution Date the three-month average of the related
Sixty-Plus Delinquency Percentage, as determined on that distribution date and the
immediately preceding two Distribution Dates, equals or exceeds 44.25% of the Senior
Enhancement Percentage or (ii) the aggregate amount of Realized Losses on the mortgage loans
as a percentage of the Cut-off Date Principal Balance exceeds the applicable amount set
forth below:
January 2009 to December 2009............ 1.75% with respect to January 2009,
plus an additional 1/12th of 1.10% for
each month thereafter.
January 2010 to December 2010............ 2.85% with respect to January 2010,
plus an additional 1/12th of 0.90% for
each month thereafter.
January 2011 to December 2011............ 3.75% with respect to January 2011,
plus an additional 1/12th of 0.50% for
each month thereafter.
January 2012 and thereafter.............. 4.25%
Trust Fund: The segregated pool of assets subject hereto, consisting of: (i) the
Mortgage Loans and the related Mortgage Files; (ii) all payments on and collections in
respect of the Mortgage Loans due after the Cut-off Date (other than Monthly Payments due in
the month of the Cut-off Date) as shall be on deposit in the Custodial Account or in the
Certificate Account and identified as belonging to the Trust Fund; (iii) property which
secured a Mortgage Loan and which has been acquired for the benefit of the
Certificateholders by foreclosure or deed in lieu of foreclosure; (iv) the hazard insurance
policies and Primary Insurance Policies pertaining to the Mortgage Loans, if any; (v) rights
under the Yield Maintenance Agreement and any payments thereunder; and (vi) all proceeds of
clauses (i) through (v) above.
Uncertificated Accrued Interest: With respect to any REMIC I Regular Interest for any
Distribution Date, one month's interest at the related Uncertificated REMIC I Pass-Through
Rate for such Distribution Date, accrued on its Uncertificated Principal Balance immediately
prior to such Distribution Date. Uncertificated Accrued Interest for the REMIC I Regular
Interests shall accrue on the basis of a 360-day year consisting of twelve 30-day months.
For purposes of calculating the amount of Uncertificated Accrued Interest for the REMIC I
Regular Interests for any Distribution Date, any Prepayment Interest Shortfalls and Relief
Act Shortfalls (to the extent not covered by Compensating Interest) relating to the Mortgage
Loans for any Distribution Date shall be allocated first, to Uncertificated Accrued Interest
payable to REMIC I Regular Interest AA and REMIC I Regular Interest ZZ up to an aggregate
amount equal to the REMIC I Interest Loss Allocation Amount, 98% and 2%, respectively, and
thereafter any remaining Prepayment Interest Shortfalls (to the extent not covered by
Eligible Master Servicing Compensation) for any Distribution Date shall be allocated among
REMIC I Regular Interest AA, REMIC I Regular Interest A-1, REMIC I Regular Interest A-2,
REMIC I Regular Interest A-3, REMIC I Regular Interest M-1, REMIC I Regular Interest M-2,
REMIC I Regular Interest M-3, REMIC I Regular Interest M-1, REMIC I Regular Interest M-4,
REMIC I Regular Interest M-5, REMIC I Regular Interest B and REMIC I Regular Interest ZZ,
pro rata based on, and to the extent of, Uncertificated Accrued Interest, as calculated
without application of this sentence.
Uncertificated Notional Amount: With respect to the REMIC II Regular Interest SB-IO
component of the Class SB Certificates and any Distribution Date, an amount equal to the
aggregate Uncertificated Principal Balance of the REMIC I Regular Interests for such
Distribution Date.
Uncertificated Principal Balance: As of the Closing Date, the Uncertificated
Principal Balance of each REMIC I Regular Interest shall equal the amount set forth in the
Preliminary Statement hereto as its initial Uncertificated Principal Balance. On each
Distribution Date, the Uncertificated Principal Balance of each REMIC I Regular Interest
shall be reduced by all distributions of principal deemed made on such REMIC Regular
Interest on such Distribution Date pursuant to Section 4.02 and, if and to the extent
necessary and appropriate, shall be further reduced on such Distribution Date by Realized
Losses as provided in Section 4.05, and the Uncertificated Principal Balance of REMIC I
Regular Interest ZZ shall be increased by the related interest deferrals as provided in
Section 4.02. The Uncertificated Principal Balance of each REMIC I Regular Interest shall
never be less than zero. With respect to the REMIC II Regular Interest SB-PO an initial
amount equal to the amount set forth in the Preliminary Statement hereto as its initial
Uncertificated Principal Balance. On each Distribution Date, the Uncertificated Principal
Balance of each REMIC II Regular Interest shall be reduced by all distributions of principal
deemed made on such REMIC Regular Interest on such Distribution Date pursuant to Section
4.02 and, if and to the extent necessary and appropriate, shall be further reduced on such
Distribution Date by Realized Losses as provided in Section 4.05.
Uncertificated REMIC I Pass-Through Rate: With respect to any Distribution Date, a
per annum rate equal to the weighted average of the Net Mortgage Rates of the Mortgage Loans
in effect for the scheduled Monthly Payments due on such Mortgage Loans during the related
Due Period.
Uniform Single Attestation Program for Mortgage Bankers: The Uniform Single
Attestation Program for Mortgage Bankers, as published by the Mortgage Bankers Association
of America and effective with respect to fiscal periods ending on or after December 15, 1995.
Uninsured Cause: Any cause of damage to property subject to a Mortgage such that the
complete restoration of such property is not fully reimbursable by the hazard insurance
policies.
United States Person: A citizen or resident of the United States, a corporation,
partnership or other entity (treated as a corporation or partnership for United States
federal income tax purposes) created or organized in, or under the laws of, the United
States, any state thereof, or the District of Columbia (except in the case of a partnership,
to the extent provided in Treasury regulations) provided that, for purposes solely of the
restrictions on the transfer of Class R Certificates, no partnership or other entity treated
as a partnership for United States federal income tax purposes shall be treated as a United
States Person unless all persons that own an interest in such partnership either directly or
through any entity that is not a corporation for United States federal income tax purposes
are required by the applicable operative agreement to be United States Persons, or an estate
that is described in Section 7701(a)(30)(D) of the Code, or a trust that is described in
Section 7701(a)(30)(E) of the Code.
VA: The Veterans Administration, or its successor.
Voting Rights: The portion of the voting rights of all of the Certificates which is
allocated to any Certificate. 98.00% of all of the Voting Rights shall be allocated among
Holders of the Class A, Class M Certificates and Class B Certificates in proportion to the
outstanding Certificate Principal Balances of their respective Certificates; 1% of all of
the Voting Rights shall be allocated among the Holders of the Class SB Certificates; 0.50%
and 0.50%, of all of the Voting Rights shall be allocated to each of the Holders of the
Class R-I and Class R-II Certificates, respectively; in each case to be allocated among the
Certificates of such Class in accordance with their respective Percentage Interest.
Yield Maintenance Agreement: The yield maintenance agreement, effective as of
December 29, 2005, between the Yield Maintenance Agreement Provider and the Trustee, on
behalf of the Trust, which agreement provides for Yield Maintenance Payments and Yield
Maintenance Termination Payments to be paid, as provided therein, together with any
schedules, confirmations or other agreements relating thereto, attached hereto as Exhibit U.
Yield Maintenance Agreement Notional Balance: With respect to any Distribution Date
specified below and the Yield Maintenance Agreement, the lesser of (1) the aggregate
Certificate Principal Balance of the Class A, Class M and Class B Certificates immediately
prior to that Distribution Date and (2) the amount specified below for that Distribution
Date:
Notional
Distribution Date Balance
January 25, 2006.......... 247,039,403.98
February 25, 2006......... 241,981,743.56
March 25, 2006............ 236,645,236.87
April 25, 2006............ 231,288,983.22
May 25, 2006.............. 225,502,270.13
June 25, 2006............. 220,060,372.32
July 25, 2006............. 214,655,235.70
August 25, 2006........... 209,290,017.21
September 25, 2006........ 203,955,902.23
October 25, 2006.......... 198,670,869.64
November 25, 2006......... 193,515,264.87
December 25, 2006......... 188,487,561.70
January 25, 2007.......... 183,592,031.35
February 25, 2007......... 178,806,743.67
March 25, 2007............ 172,831,046.66
April 25, 2007............ 167,282,124.05
May 25, 2007.............. 129,216,833.13
June 25, 2007............. 125,907,244.20
July 25, 2007............. 122,692,600.59
August 25, 2007........... 119,552,908.05
September 25, 2007........ 115,950,889.22
October 25, 2007.......... 93,885,331.57
November 25, 2007......... 91,596,625.97
December 25, 2007......... 89,298,283.07
January 25, 2008.......... 87,144,943.55
February 25, 2008......... 85,033,598.81
March 25, 2008............ 82,485,585.62
April 25, 2008............ 79,985,735.36
May 25, 2008.............. 77,079,477.27
June 25, 2008............. 75,257,197.07
July 25, 2008............. 73,477,324.65
August 25, 2008........... 71,738,873.77
September 25, 2008........ 69,564,613.89
October 25, 2008.......... 67,387,738.53
November 25, 2008......... 65,803,221.09
December 25, 2008......... 64,255,151.69
January 25, 2009.......... 62,742,699.27
February 25, 2009......... 61,265,051.77
March 25, 2009............ 59,821,415.65
April 25, 2009............ 58,411,015.49
May 25, 2009.............. 57,033,093.58
June 25, 2009............. 55,686,909.49
July 25, 2009............. 54,371,739.66
August 25, 2009.......... 53,086,877.06
September 25, 2009........ 51,831,630.76
October 25, 2009.......... 50,569,999.98
November 25, 2009......... 49,373,270.97
December 25, 2009......... 48,160,428.44
January 25, 2010.......... 46,957,683.18
February 25, 2010......... 45,845,528.38
March 25, 2010............ 44,758,990.80
April 25, 2010............ 43,697,488.53
May 25, 2010.............. 42,548,203.88
June 25, 2010............. 41,538,986.97
July 25, 2010............. 40,361,745.19
August 25, 2010........... 39,330,399.78
September 25, 2010........ 38,398,438.58
October 25, 2010.......... 37,490,408.07
November 25, 2010......... 36,603,166.91
December 25, 2010......... 35,736,248.42
Yield Maintenance Agreement Provider: The yield maintenance agreement provider under
the Yield Maintenance Agreement required to make payments to the Trustee for payment to the
Trust Fund pursuant to the terms of the Yield Maintenance Agreement, and any successor in
interest or assign. Initially, the Yield Maintenance Agreement Provider shall be Bank of
America, N.A.
Yield Maintenance Agreement Principal Distributable Amount: With respect to any
Distribution Date, any Yield Maintenance Payment received by the Trustee, on behalf of the
Trust Fund, under the Yield Maintenance Agreement for such Distribution Date and paid as
part of the Principal Distribution Amount for such Distribution Date in accordance with
Sections 4.02(c)(x) and (xi) in accordance with the allocation of Excess Cash Flow described
in Section 4.02(f).
Yield Maintenance Agreement Termination Payment: Upon the designation of an "Early
Termination Date" as defined in the Yield Maintenance Agreement, the payment to be made by
the Yield Maintenance Agreement Provider to the Trustee for payment to the Trust Fund
pursuant to the terms of the Yield Maintenance Agreement.
Yield Maintenance Payment: With respect to each Distribution Date, any payment
received by the Trustee, on behalf of the Trust Fund, from the Yield Maintenance Agreement
Provider pursuant to the terms of the Yield Maintenance Agreement, with respect to such
Distribution Date, provided that such payment shall not include any payment received by the
Trustee, on behalf of the Trust Fund, that is a Yield Maintenance Agreement Termination
Payment, except as set forth in Section 4.09(e).
Section 1.02. Determination of LIBOR.
LIBOR applicable to the calculation of the Pass-Through Rate on the Class A, Class M
and Class B Certificates for any Interest Accrual Period will be determined on each LIBOR
Rate Adjustment Date. On each LIBOR Rate Adjustment Date, or if such LIBOR Rate Adjustment
Date is not a Business Day, then on the next succeeding Business Day, 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 as of
11:00 A.M., London time, on such LIBOR Rate Adjustment Date. "Telerate Screen Page 3750"
means the display designated as page 3750 on the Bridge 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, LIBOR
shall be so established by use of such 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 LIBOR Rate Adjustment 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 Class A, Class M and Class B Certificates then
outstanding. The Trustee shall 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
Class A and Class M Certificates then outstanding. If no such quotations can be obtained,
the rate will be LIBOR for the prior Distribution Date; 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, after
consultation with the Master Servicer shall 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. 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 the Class A, Class
M and Class B 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 shall supply to any Certificateholder so
requesting by calling the Trustee at ▇-▇▇▇-▇▇▇-▇▇▇▇ the Pass-Through Rate on the Class A,
Class M and Class B Certificates for the current and the immediately preceding Interest
Accrual Period.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01. Conveyance of Mortgage Loans.
(a) The Depositor, concurrently with the execution and delivery hereof, does hereby
assign to the Trustee without recourse all the right, title and interest of the Depositor in
and to (i) the Mortgage Loans, including all interest and principal on or with respect to
the Mortgage Loans due on or after the Cut-off Date (other than Monthly Payments due on the
Mortgage Loans in the month of the Cut-off Date); and (ii) all proceeds of the foregoing. In
addition, on the Closing Date, the Trustee is hereby directed to enter into the Yield
Maintenance Agreement on behalf of the Trust Fund with the Yield Maintenance Agreement
Provider.
The Depositor, the Master Servicer and the Trustee 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 Security Act effective
November 27, 2003, (ii) a "High-Cost Home Loan" as defined in the New Mexico Home Loan
Protection Act effective January 1, 2004, (iii) a "High Cost Home Mortgage Loan" as defined
in the Massachusetts Predatory Home Loan Practices Act effective November 7, 2004 or (iv) a
"High-Cost Home Loan" as defined in the Indiana Home Loan Practices Act effective as of
January 1, 2005.
(b) In connection with such assignment, and contemporaneously with the delivery of this
Agreement, the Depositor 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), and except as set forth in Section 2.01(c) below and subject to Section 2.01(d)
below, the Depositor does hereby deliver to, and deposit with, the Trustee, or to and with
one or more Custodians, as the duly appointed agent or agents of the Trustee for such
purpose, the following documents or instruments (or copies thereof as permitted by this
Section) with respect to each Mortgage Loan so assigned:
(I) with respect to each Mortgage Loan so assigned (other than a Cooperative Loan):
(i) The original Mortgage Note, endorsed without recourse to the order of the Trustee and
showing an unbroken chain of endorsements from the originator thereof to the Person
endorsing it to the Trustee, or with respect to any Destroyed Mortgage Note, an
original lost note affidavit from the related Seller or Residential Funding stating
that the original Mortgage Note was lost, misplaced or destroyed, together with a
copy of the related Mortgage Note;
(ii) The original Mortgage, noting the presence of the MIN of the Mortgage Loan and
language indicating that the Mortgage Loan is a MOM Loan if the Mortgage Loan is a
MOM Loan, with evidence of recording indicated thereon or, if the original Mortgage
has not yet been returned from the public recording office, a copy of the original
Mortgage with evidence of recording indicated thereon;
(iii) Unless the Mortgage Loan is registered on the MERS(R)System, the Assignment (which may
be included in one or more blanket assignments if permitted by applicable law) of the
Mortgage to the Trustee with evidence of recording indicated thereon or a copy of
such assignment with evidence of recording indicated thereon;
(iv) The original recorded assignment or assignments of the Mortgage showing an unbroken
chain of title from the originator to the Person assigning it to the Trustee (or to
MERS, if the Mortgage Loan is registered on the MERS(R)System and noting the presence
of a MIN) with evidence of recordation noted thereon or attached thereto, or a copy
of such assignment or assignments of the Mortgage with evidence of recording
indicated thereon; and
(v) The original of each modification, assumption agreement or preferred loan agreement,
if any, relating to such Mortgage Loan, or a copy of each modification, assumption
agreement or preferred loan agreement.
and (II) with respect to each Cooperative Loan so assigned:
(i) The original Mortgage Note, endorsed without recourse to the order of the Trustee and
showing an unbroken chain of endorsements from the originator thereof to the Person
endorsing it to the Trustee, or with respect to any Destroyed Mortgage Note, an
original lost note affidavit from the related Seller or Residential Funding stating
that the original Mortgage Note was lost, misplaced or destroyed, together with a
copy of the related Mortgage Note;
(ii) A counterpart of the Cooperative Lease and the Assignment of Proprietary Lease to the
originator of the Cooperative Loan with intervening assignments showing an unbroken
chain of title from such originator to the Trustee;
(iii) The related Cooperative Stock Certificate, representing the related Cooperative Stock
pledged with respect to such Cooperative Loan, together with an undated stock power
(or other similar instrument) executed in blank;
(iv) The original recognition agreement by the Cooperative of the interests of the
mortgagee with respect to the related Cooperative Loan;
(v) The Security Agreement;
(vi) Copies of the original UCC-1 financing statement, and any continuation statements,
filed by the originator of such Cooperative Loan as secured party, each with evidence
of recording thereof, evidencing the interest of the originator under the Security
Agreement and the Assignment of Proprietary Lease;
(vii) Copies of the filed UCC-3 assignments of the security interest referenced in clause
(vi) above showing an unbroken chain of title from the originator to the Trustee,
each with evidence of recording thereof, evidencing the interest of the originator
under the Security Agreement and the Assignment of Proprietary Lease;
(viii) An executed assignment of the interest of the originator in the Security Agreement,
Assignment of Proprietary Lease and the recognition agreement referenced in clause
(iv) above, showing an unbroken chain of title from the originator to the Trustee;
(ix) The original of each modification, assumption agreement or preferred loan agreement,
if any, relating to such Cooperative Loan; and
(x) A duly completed UCC-1 financing statement showing Residential Funding as debtor, the
Depositor as secured party and the Trustee as assignee and a duly completed UCC-1
financing statement showing the Depositor as debtor and the Trustee as secured party,
each in a form sufficient for filing, evidencing the interest of such debtors in the
Cooperative Loans.
The Depositor 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.
(c) Notwithstanding the provisions of Section 2.01(b), in the event that in connection
with any Mortgage Loan, if the Depositor cannot deliver the original of the Mortgage, any
assignment, modification, assumption agreement or preferred loan agreement (or copy thereof
as permitted by Section 2.01(b)) with evidence of recording thereon concurrently with the
execution and delivery of this Agreement because of (i) a delay caused by the public
recording office where such Mortgage, assignment, modification, assumption agreement or
preferred loan agreement as the case may be, has been delivered for recordation, or (ii) a
delay in the receipt of certain information necessary to prepare the related assignments,
the Depositor shall deliver or cause to be delivered to the Trustee or the respective
Custodian a copy of such Mortgage, assignment, modification, assumption agreement or
preferred loan agreement.
The Depositor shall promptly cause to be recorded in the appropriate public office
for real property records the Assignment referred to in clause (iii) of Section 2.01(b),
except (a) in states where, in the Opinion of Counsel acceptable to the Master Servicer,
such recording is not required to protect the Trustee's interests in the Mortgage Loan or
(b) if MERS is identified on the Mortgage or on a properly recorded assignment of the
Mortgage as the mortgagee of record solely as nominee for Residential Funding and its
successors and assigns; and shall promptly cause to be filed the Form UCC-3 assignment and
UCC-1 financing statement referred to in clause (II)(vii) and (x), respectively, of Section
2.01(b). If any Assignment, Form UCC-3 or Form UCC-1, as applicable, is lost or returned
unrecorded to the Depositor because of any defect therein, the Depositor shall prepare a
substitute Assignment, Form UCC-3 or Form UCC-1, as applicable, or cure such defect, as the
case may be, and cause such Assignment, Form UCC-3 or Form UCC-1 to be recorded in
accordance with this paragraph. The Depositor shall promptly deliver or cause to be
delivered to the Trustee or the respective Custodian such Mortgage or Assignment, Form UCC-3
or Form UCC-1, as applicable (or copy thereof as permitted by Section 2.01(b)), with
evidence of recording indicated thereon upon receipt thereof from the public recording
office or from the related Subservicer or Seller. In connection with its servicing of
Cooperative Loans, the Master Servicer will use its best efforts to file timely continuation
statements with regard to each financing statement and assignment relating to Cooperative
Loans as to which the related Cooperative Apartment is located outside of the State of New
York.
If the Depositor delivers to the Trustee or Custodian any Mortgage Note or Assignment
of Mortgage in blank, the Depositor shall, or shall cause the Custodian to, complete the
endorsement of the Mortgage Note and the Assignment of Mortgage in the name of the Trustee
in conjunction with the Interim Certification issued by the Custodian, as contemplated by
Section 2.02.
Any of the items set forth in Sections 2.01(b)(I)(ii), (iii), (iv) and (v) and
(II)(vi) and (vii) and that may be delivered as a copy rather than the original may be
delivered to the Trustee or the Custodian.
In connection with the assignment of any Mortgage Loan registered on the MERS(R)
System, the Depositor further agrees that it will cause, at the Depositor's own expense,
within 30 Business Days after the Closing Date, the MERS(R)System to indicate that such
Mortgage Loans have been assigned by the Depositor to the Trustee in accordance with this
Agreement for the benefit of the Certificateholders by including (or deleting, in the case
of Mortgage Loans which are repurchased in accordance with this Agreement) in such computer
files (a) the code in the field which identifies the specific Trustee and (b) the code in
the field "Pool Field" which identifies the series of the Certificates issued in connection
with such Mortgage Loans. The Depositor further agrees that it will not, and will not permit
the Master Servicer to, and the Master Servicer agrees that it will not, alter the codes
referenced in this paragraph with respect to any Mortgage Loan during the term of this
Agreement unless and until such Mortgage Loan is repurchased in accordance with the terms of
this Agreement.
(d) It is intended that the conveyances by the Depositor to the Trustee of the Mortgage
Loans as provided for in this Section 2.01 be construed as a sale by the Depositor to the
Trustee of the Mortgage Loans for the benefit of the Certificateholders. Further, it is not
intended that any such conveyance be deemed to be a pledge of the Mortgage Loans by the
Depositor to the Trustee to secure a debt or other obligation of the Depositor. However, in
the event that the Mortgage Loans are held to be property of the Depositor or of Residential
Funding, or if for any reason this Agreement is held or deemed to create a security interest
in the Mortgage Loans, then it is intended that (a) this Agreement shall also be deemed to
be a security agreement within the meaning of Articles 8 and 9 of the New York Uniform
Commercial Code and the Uniform Commercial Code of any other applicable jurisdiction; (b)
the conveyances provided for in this Section 2.01 shall be deemed to be (1) a grant by the
Depositor to the Trustee of a security interest in all of the Depositor's right (including
the power to convey title thereto), title and interest, whether now owned or hereafter
acquired, in and to (A) the Mortgage Loans, including (a) with respect to each Cooperative
Loan, the related Mortgage Note, Security Agreement, Assignment of Property Lease,
Cooperative Stock Certificate and Cooperative Lease and Mortgage, and (b) with respect to
each Mortgage Loan other than a Cooperative Loan, the related Mortgage Note and Mortgage and
(c) any insurance policies and all other documents in the related Mortgage Files, (B) all
amounts payable pursuant to the Mortgage Loans or the Yield Maintenance Agreement in
accordance with the terms thereof and (C) any and all general intangibles, payment
intangibles, accounts, chattel paper, instruments, documents, money, deposit accounts,
certificates of deposit, goods, letters of credit, advices of credit and investment property
and other property of whatever kind or description now existing or hereafter acquired
consisting of, arising from or relating to any of the foregoing, and all proceeds of the
conversion, voluntary or involuntary, of the foregoing into cash, instruments, securities or
other property, including without limitation all amounts from time to time held or invested
in the Certificate Account or the Custodial Account, whether in the form of cash,
instruments, securities or other property and (2) an assignment by the Depositor to the
Trustee of any security interest in any and all of Residential Funding's right (including
the power to convey title thereto), title and interest, whether now owned or hereafter
acquired, in and to the property described in the foregoing clauses (1)(A), (B), (C) and (D)
granted by Residential Funding to the Depositor pursuant to the Assignment Agreement; (c)
the possession by the Trustee, the Custodian or any other agent of the Trustee of Mortgage
Notes or such other items of property as they constitute instruments, money, payment
intangibles, negotiable documents, goods, deposit accounts, letters of credit, advices of
credit, investment property, certificated securities or chattel paper shall be deemed to be
"possession by the secured party," or possession by a purchaser or a person designated by
such secured party, for purposes of perfecting the security interest pursuant to the Uniform
Commercial Code as in effect in the States of New York and Minnesota and any other
applicable jurisdiction; and (d) notifications to persons holding such property, and
acknowledgments, receipts or confirmations from persons holding such property, shall be
deemed notifications to, or acknowledgments, receipts or confirmations from, securities
intermediaries, bailees or agents of, or persons holding for, (as applicable) the Trustee
for the purpose of perfecting such security interest under applicable law.
The Depositor and, at the Depositor's direction, Residential Funding and the Trustee
shall, to the extent consistent with this Agreement, take such reasonable actions as may be
necessary to ensure that, if this Agreement were deemed to create a security interest in the
Mortgage Loans and the other property described above, such security interest would be
deemed to be a perfected security interest of first priority under applicable law and will
be maintained as such throughout the term of this Agreement. Without limiting the generality
of the foregoing, the Depositor shall prepare and deliver to the Trustee not less than 15
days prior to any filing date and, the Trustee shall forward for filing, or shall cause to
be forwarded for filing, at the expense of the Depositor, all filings necessary to maintain
the effectiveness of any original filings necessary under the Uniform Commercial Code as in
effect in any jurisdiction to perfect the Trustee's security interest in or lien on the
Mortgage Loans, as evidenced by an Officers' Certificate of the Depositor, including without
limitation (x) continuation statements, and (y) such other statements as may be occasioned
by (1) any change of name of Residential Funding, the Depositor or the Trustee (such
preparation and filing shall be at the expense of the Trustee, if occasioned by a change in
the Trustee's name), (2) any change of location of the place of business or the chief
executive office of Residential Funding or the Depositor or (3) any transfer of any interest
of Residential Funding or the Depositor in any Mortgage Loan.
Section 2.02. Acceptance by Trustee.
The Trustee acknowledges receipt (or, with respect to Mortgage Loans subject to a
Custodial Agreement, and based solely upon a receipt or certification executed by the
Custodian, receipt by the respective Custodian as the duly appointed agent of the Trustee)
of the documents referred to in Section 2.01(b)(I)(i) and Section 2.01(b)(II)(i), (iii),
(v), (vi) and (viii) above (except that for purposes of such acknowledgment only, a Mortgage
Note may be endorsed in blank and an Assignment of Mortgage may be in blank) and declares
that it, or a Custodian as its agent, holds and will hold such documents and the other
documents constituting a part of the Mortgage Files delivered to it, or a Custodian as its
agent, in trust for the use and benefit of all present and future Certificateholders. The
Trustee or Custodian (such Custodian being so obligated under a Custodial Agreement) agrees,
for the benefit of Certificateholders, to review each Mortgage File delivered to it pursuant
to Section 2.01(b) within 45 days after the Closing Date to ascertain that all required
documents (specifically as set forth in Section 2.01(b)), have been executed and received,
and that such documents relate to the Mortgage Loans identified on the Mortgage Loan
Schedule, as supplemented, that have been conveyed to it, and to deliver to the Trustee a
certificate (the "Interim Certification") to the effect that all documents required to be
delivered pursuant to Section 2.01(b) above have been executed and received and that such
documents relate to the Mortgage Loans identified on the Mortgage Loan Schedule, except for
any exceptions listed on Schedule A attached to such Interim Certification. Upon delivery of
the Mortgage Files by the Depositor or the Master Servicer, the Trustee shall acknowledge
receipt (or, with respect to Mortgage Loans subject to a Custodial Agreement, and based
solely upon a receipt or certification (the "Final Certification") executed by the
Custodian, receipt by the respective Custodian as the duly appointed agent of the Trustee)
of the documents referred to in Section 2.01(c) above.
If the Custodian, as the Trustee's agent, finds any document or documents
constituting a part of a Mortgage File to be missing or defective, upon receipt of
notification from the Custodian as specified in the succeeding sentence, the Trustee shall
promptly so notify or cause the Custodian to notify the Master Servicer and the Depositor;
provided, that if the Mortgage Loan related to such Mortgage File is listed on Schedule A of
the Assignment Agreement, no notification shall be necessary. Pursuant to Section 2.3 of the
Custodial Agreement, the Custodian will notify the Master Servicer, the Depositor and the
Trustee of any such omission or defect found by it in respect of any Mortgage File held by
it in respect of the items received by it pursuant to the Custodial Agreement. If such
omission or defect materially and adversely affects the interests in the related Mortgage
Loan of the Certificateholders, the Master Servicer shall promptly notify the related
Subservicer of such omission or defect and request that such Subservicer correct or cure
such omission or defect within 60 days from the date the Master Servicer was notified of
such omission or defect and, if such Subservicer does not correct or cure such omission or
defect within such period, that such Subservicer purchase such Mortgage Loan from the Trust
Fund at its Purchase Price, in either case within 90 days from the date the Master Servicer
was notified of such omission or defect; 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; and provided further, that no cure, substitution or repurchase shall be
required if such omission or defect is in respect of a Mortgage Loan listed on Schedule A of
the Assignment Agreement. The Purchase Price for any such Mortgage Loan shall be deposited
or caused to be deposited by the Master Servicer in the Custodial Account maintained by it
pursuant to Section 3.07 and, upon receipt by the Trustee of written notification of such
deposit signed by a Servicing Officer, the Trustee or any Custodian, as the case may be,
shall release to the Master Servicer the related Mortgage File and the Trustee shall execute
and deliver such instruments of transfer or assignment prepared by the Master Servicer, in
each case without recourse, as shall be necessary to vest in the Subservicer or its
designee, as the case may be, any Mortgage Loan released pursuant hereto and thereafter such
Mortgage Loan shall not be part of the Trust Fund. In furtherance of the foregoing, if the
Subservicer or Residential Funding that repurchases the Mortgage Loan is not a member of
MERS and the Mortgage is registered on the MERS(R)System, the Master Servicer, at its own
expense and without any right of reimbursement, shall cause MERS to execute and deliver an
assignment of the Mortgage in recordable form to transfer the Mortgage from MERS to such
Subservicer or Residential Funding and shall cause such Mortgage to be removed from
registration on the MERS(R)System in accordance with MERS' rules and regulations. It is
understood and agreed that the obligation of the Subservicer, to so cure or purchase any
Mortgage Loan as to which a material and adverse defect in or omission of a constituent
document exists shall constitute the sole remedy respecting such defect or omission
available to Certificateholders or the Trustee on behalf of Certificateholders.
Section 2.03. Representations, Warranties and Covenants of the Master Servicer and the
Depositor.
(a) The Master Servicer hereby represents and warrants to the Trustee for the benefit of
the Certificateholders that:
(i) The Master Servicer is a corporation duly organized, validly existing and in good
standing under the laws governing its creation and existence and is or will be in
compliance with the laws of each state in which any Mortgaged Property is located to
the extent necessary to ensure the enforceability of each Mortgage Loan in accordance
with the terms of this Agreement;
(ii) The execution and delivery of this Agreement by the Master Servicer and its
performance and compliance with the terms of this Agreement will not violate the
Master Servicer's Certificate of Incorporation or Bylaws or constitute a material
default (or an event which, with notice or lapse of time, or both, would constitute a
material default) under, or result in the material breach of, any material contract,
agreement or other instrument to which the Master Servicer is a party or which may be
applicable to the Master Servicer or any of its assets;
(iii) This Agreement, assuming due authorization, execution and delivery by the Trustee and
the Depositor, constitutes a valid, legal and binding obligation of the Master
Servicer, enforceable against it in accordance with the terms hereof subject to
applicable bankruptcy, insolvency, reorganization, moratorium and other laws
affecting the enforcement of creditors' rights generally and to general principles of
equity, regardless of whether such enforcement is considered in a proceeding in
equity or at law;
(iv) The Master Servicer is not in default with respect to any order or decree of any
court or any order, regulation or demand of any federal, state, municipal or
governmental agency, which default might have consequences that would materially and
adversely affect the condition (financial or other) or operations of the Master
Servicer or its properties or might have consequences that would materially adversely
affect its performance hereunder;
(v) No litigation is pending or, to the best of the Master Servicer's knowledge,
threatened against the Master Servicer which would prohibit its entering into this
Agreement or performing its obligations under this Agreement;
(vi) The Master Servicer shall comply in all material respects in the performance of this
Agreement with all reasonable rules and requirements of each insurer under each
Required Insurance Policy;
(vii) No information, certificate of an officer, statement furnished in writing or report
delivered to the Depositor, any Affiliate of the Depositor or the Trustee by the
Master Servicer will, to the knowledge of the Master Servicer, contain any untrue
statement of a material fact or omit a material fact necessary to make the
information, certificate, statement or report not misleading;
(viii) The Master Servicer has examined each existing, and will examine each new,
Subservicing Agreement and is or will be familiar with the terms thereof. The terms
of each existing Subservicing Agreement and each designated Subservicer are
acceptable to the Master Servicer and any new Subservicing Agreements will comply
with the provisions of Section 3.02; and
(ix) The Master Servicer is a member of MERS in good standing, and will comply in all
material respects with the rules and procedures of MERS in connection with the
servicing of the Mortgage Loans that are registered with MERS.
It is understood and agreed that the representations and warranties set forth in this
Section 2.03(a) shall survive delivery of the respective Mortgage Files to the Trustee or
any Custodian. Upon discovery by either the Depositor, the Master Servicer, the Trustee or
any Custodian of a breach of any representation or warranty set forth in this Section
2.03(a) which 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). Within 90 days
of its discovery or its receipt of notice of such breach, the Master Servicer shall either
(i) cure such breach in all material respects or (ii) to the extent that such breach is with
respect to a Mortgage Loan or a related document, purchase such Mortgage Loan from the Trust
Fund at the Purchase Price and in the manner set forth in Section 2.02; provided that if the
breach 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. The obligation of the Master Servicer to cure such
breach or to so purchase such Mortgage Loan shall constitute the sole remedy in respect of a
breach of a representation and warranty set forth in this Section 2.03(a) available to the
Certificateholders or the Trustee on behalf of the Certificateholders.
(b) The Depositor hereby represents and warrants to the Trustee for the benefit of the
Certificateholders that as of the Closing Date (or, if otherwise specified below, as of the
date so specified): (i) the information set forth in Exhibit G 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 respective date or dates which such information is furnished; (ii)
immediately prior to the conveyance of the Mortgage Loans to the Trustee, the Depositor 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 conveyance validly transfers ownership of the Mortgage Loans to the
Trustee free and clear of any pledge, lien, encumbrance or security interest; and (iii) 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).
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 Depositor, 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) which 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)(iii), 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
Depositor 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 Depositor 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, substitution or repurchase must occur within 90 days from the
date such breach was discovered. Any such substitution shall be effected by the Depositor
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 Depositor 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 Depositor shall not be required to
cure breaches or purchase or substitute for Mortgage Loans as provided in this Section
2.03(b) if the substance of the breach of a representation set forth above also constitutes
fraud in the origination of the Mortgage Loan.
Section 2.04. Representations and Warranties of Residential Funding.
The Depositor, as assignee of Residential Funding under the Assignment Agreement,
hereby assigns to the Trustee for the benefit of the Certificateholders all of its right,
title and interest in respect of the Assignment Agreement applicable to a Mortgage Loan.
Insofar as the Assignment Agreement relates to the representations and warranties made by
Residential Funding in respect of such Mortgage Loan and any remedies provided thereunder
for any breach of such representations and warranties, such right, title and interest may be
enforced by the Master Servicer on behalf of the Trustee and the Certificateholders.
Upon the discovery by the Depositor, the Master Servicer, the Trustee or any
Custodian of a breach of any of the representations and warranties made in the Assignment
Agreement in respect of any Mortgage Loan or of any Repurchase Event which materially and
adversely affects the interests of the Certificateholders in such 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). The Master Servicer shall promptly notify
Residential Funding of such breach or Repurchase Event and request that Residential Funding
either (i) cure such breach or Repurchase Event in all material respects within 90 days from
the date the Master Servicer was notified of such breach or Repurchase Event 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, in the case of a breach or Repurchase Event under the
Assignment Agreement, Residential Funding 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 breach 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 substitution must occur within 90 days from the date the breach was
discovered. If the breach of representation and warranty that gave rise to the obligation to
repurchase or substitute a Mortgage Loan pursuant to Section 4 of the Assignment Agreement
was the representation and warranty set forth in clause (cc) of Section 4 thereof, then the
Master Servicer shall request that Residential Funding pay to the Trust Fund, concurrently
with and in addition to the remedies provided in the preceding sentence, an amount equal to
any liability, penalty or expense that was actually incurred and paid out of or on behalf of
the Trust Fund, and that directly resulted from such breach, or if incurred and paid by the
Trust Fund thereafter, concurrently with such payment. In the event that Residential Funding
elects to substitute a Qualified Substitute Mortgage Loan or Loans for a Deleted Mortgage
Loan pursuant to this Section 2.04, Residential Funding shall deliver to the Trustee for the
benefit of the Certificateholders with respect to such Qualified Substitute Mortgage Loan or
Loans, the original Mortgage Note, the Mortgage, an Assignment of the Mortgage in recordable
form, and such other documents and agreements as are required by Section 2.01, with the
Mortgage Note endorsed as required by Section 2.01. No substitution will be made in any
calendar month after the Determination Date for such month. Monthly Payments due with
respect to Qualified Substitute Mortgage Loans in the month of substitution shall not be
part of the Trust Fund and will be retained by the Master Servicer and remitted by the
Master Servicer to Residential Funding on the next succeeding Distribution Date. For the
month of substitution, distributions to the Certificateholders will include the Monthly
Payment due on a Deleted Mortgage Loan for such month and thereafter Residential Funding
shall be entitled to retain all amounts received in respect of such Deleted Mortgage Loan.
The Master Servicer shall amend or cause to be amended the Mortgage Loan Schedule for the
benefit of the Certificateholders to reflect the removal of such Deleted Mortgage Loan and
the substitution of the Qualified Substitute Mortgage Loan or Loans and the Master Servicer
shall deliver the amended Mortgage Loan Schedule to the Trustee and the Custodian. Upon such
substitution, the Qualified Substitute Mortgage Loan or Loans shall be subject to the terms
of this Agreement and the related Subservicing Agreement in all respects, and Residential
Funding shall be deemed to have made the representations and warranties with respect to the
Qualified Substitute Mortgage Loan contained in Section 4 of the Assignment Agreement, as of
the date of substitution, and the covenants, representations and warranties set forth in
this Section 2.04, and in Section 2.03 hereof and in Section 4 of the Assignment Agreement,
and the Master Servicer shall be obligated to repurchase or substitute for any Qualified
Substitute Mortgage Loan as to which a Repurchase Event (as defined in the Assignment
Agreement) has occurred pursuant to Section 4 of the Assignment Agreement.
In connection with the substitution of one or more Qualified Substitute Mortgage
Loans for one or more Deleted Mortgage Loans, the Master Servicer shall determine the amount
(if any) by which the aggregate principal balance of all such Qualified Substitute Mortgage
Loans as of the date of substitution is less than the aggregate Stated Principal Balance of
all such Deleted Mortgage Loans (in each case after application of the principal portion of
the Monthly Payments due in the month of substitution that are to be distributed to the
Certificateholders in the month of substitution). Residential Funding shall deposit the
amount of such shortfall into the Custodial Account on the day of substitution, without any
reimbursement therefor. Residential Funding shall give notice in writing to the Trustee of
such event, which notice shall be accompanied by an Officers' Certificate as to the
calculation of such shortfall and (subject to Section 10.01(f)) by an Opinion of Counsel to
the effect that such substitution will not cause (a) any federal tax to be imposed on the
Trust Fund, including without limitation, any federal tax imposed on "prohibited
transactions" under Section 860F(a)(1) of the Code or on "contributions after the startup
date" under Section 860G(d)(1) of the Code or (b) any portion of any REMIC created hereunder
to fail to qualify as a REMIC at any time that any Certificate is outstanding.
It is understood and agreed that the obligation of Residential Funding to cure such
breach or purchase (or in the case of Residential Funding to substitute for) such Mortgage
Loan as to which such a breach has occurred and is continuing and to make any additional
payments required under the Assignment Agreement in connection with a breach of the
representation and warranty in clause (bb) of Section 4 thereof shall constitute the sole
remedy respecting such breach available to the Certificateholders or the Trustee on behalf
of the Certificateholders. If the Master Servicer is Residential Funding, then the Trustee
shall also have the right to give the notification and require the purchase or substitution
provided for in the second preceding paragraph in the event of such a breach of a
representation or warranty made by Residential Funding in the Assignment Agreement. In
connection with the purchase of or substitution for any such Mortgage Loan by Residential
Funding, the Trustee shall assign to Residential Funding all of the right, title and
interest in respect of the Assignment Agreement applicable to such Mortgage Loan.
Section 2.05. Execution and Authentication of Certificates; Conveyance of REMIC Regular
Interests.
(a) 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,
receipt of which is hereby acknowledged. Concurrently with such delivery and in exchange
therefor, the Trustee, pursuant to the written request of the Depositor executed by an
officer of the Depositor, has executed and caused to be authenticated and delivered to or
upon the order of the Depositor the Certificates in authorized denominations which evidence
ownership of the entire Trust Fund.
(b) The Depositor concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey in trust to the Trustee without recourse all
the right, title and interest of the Depositor in and to the REMIC I Regular Interests, for
the benefit of the holders of the REMIC II Regular Interests and the Class R-II
Certificates. The Trustee acknowledges receipt of the REMIC I Regular Interests (each of
which are uncertificated) and declares that it holds and will hold the same in trust for the
exclusive use and benefit of the holders of the REMIC II Regular Interests and the Class
R-II Certificates. The interests evidenced by the Class R-II Certificates, together with the
REMIC II Regular Interests, constitute the entire beneficial ownership interest in REMIC II.
Section 2.06. Purposes and Powers of the Trust.
The purpose of the trust, as created hereunder, is to engage in the following
activities:
(a) To sell the Certificates to the Depositor in exchange for the Mortgage Loans;
(b) To enter into and perform its obligations under this Agreement and the Yield
Maintenance Agreement;
(c) To engage in those activities that are necessary, suitable or convenient to
accomplish the foregoing or are incidental hereto or connected therewith; and
(d) Subject to compliance with this Agreement, to engage in such other activities as may
be required in connection with conservation of the Trust Fund and the making of
distributions to the Certificateholders.
The trust is hereby authorized to engage in the foregoing activities. Notwithstanding
the provisions of Section 11.01, the trust shall not engage in any activity other than in
connection with the foregoing or other than as required or authorized by the terms of this
Agreement while any Certificate is outstanding, and this Section 2.06 may not be amended,
without the consent of the Certificateholders evidencing a majority of the aggregate Voting
Rights of the Certificates.
Section 2.07. Agreement Regarding Ability to Disclose.
The Depositor, the Master Servicer and the Trustee hereby agree, notwithstanding any
other express or implied agreement to the contrary, that any and all Persons, and any of
their respective employees, representatives, and other agents may disclose, immediately upon
commencement of discussions, to any and all Persons, without limitation of any kind, the tax
treatment and tax structure of the transaction and all materials of any kind (including
opinions or other tax analyses) that are provided to any of them relating to such tax
treatment and tax structure. For purposes of this paragraph, the terms "tax treatment" and
"tax structure" are defined under Treasury Regulationss.1.6011-4(c).
ARTICLE III
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 3.01. Master Servicer to Act as Servicer.
(a) The Master Servicer shall service and administer the Mortgage Loans in accordance
with the terms of this Agreement and the respective Mortgage Loans, following such
procedures as it would employ in its good faith business judgment and which are normal and
usual in its general mortgage servicing activities, and shall have full power and authority,
acting alone or through Subservicers as provided in Section 3.02, to do any and all things
which it may deem necessary or desirable in connection with such servicing and
administration. Without limiting the generality of the foregoing, the Master Servicer in its
own name or in the name of a Subservicer is hereby authorized and empowered by the Trustee
when the Master Servicer or the Subservicer, as the case may be, believes it appropriate in
its best judgment, to execute and deliver, on behalf of the Certificateholders and the
Trustee or any of them, any and all instruments of satisfaction or cancellation, or of
partial or full release or discharge, or of consent to assumption or modification in
connection with a proposed conveyance, or of assignment of any Mortgage and Mortgage Note in
connection with the repurchase of a Mortgage Loan and all other comparable instruments, or
with respect to the modification or re-recording of a Mortgage for the purpose of correcting
the Mortgage, the subordination of the lien of the Mortgage in favor of a public utility
company or government agency or unit with powers of eminent domain, the taking of a deed in
lieu of foreclosure, the commencement, prosecution or completion of judicial or non-judicial
foreclosure, the conveyance of a Mortgaged Property to the related insurer, the acquisition
of any property acquired by foreclosure or deed in lieu of foreclosure, or the management,
marketing and conveyance of any property acquired by foreclosure or deed in lieu of
foreclosure with respect to the Mortgage Loans and with respect to the Mortgaged Properties.
The Master Servicer further is authorized and empowered by the Trustee, on behalf of the
Certificateholders and the Trustee, in its own name or in the name of the Subservicer, when
the Master Servicer or the Subservicer, as the case may be, believes it is appropriate in
its best judgment to register any Mortgage Loan on the MERS(R)System, or cause the removal
from the registration of any Mortgage Loan on the MERS(R)System, to execute and deliver, on
behalf of the Trustee and the Certificateholders or any of them, any and all instruments of
assignment and other comparable instruments with respect to such assignment or re-recording
of a Mortgage in the name of MERS, solely as nominee for the Trustee and its successors and
assigns. Any expenses incurred in connection with the actions described in the preceding
sentence shall be borne by the Master Servicer in accordance with Section 3.16(c), with no
right of reimbursement; provided, that if, as a result of MERS discontinuing or becoming
unable to continue operations in connection with the MERS(R)System, it becomes necessary to
remove any Mortgage Loan from registration on the MERS(R)System and to arrange for the
assignment of the related Mortgages to the Trustee, then any related expenses shall be
reimbursable to the Master Servicer as set forth in Section 3.10(a)(ii). Notwithstanding the
foregoing, subject to Section 3.07(a), the Master Servicer shall not permit any modification
with respect to any Mortgage Loan that would both constitute a sale or exchange of such
Mortgage Loan within the meaning of Section 1001 of the Code and any proposed, temporary or
final regulations promulgated thereunder (other than in connection with a proposed
conveyance or assumption of such Mortgage Loan that is treated as a Principal Prepayment in
Full pursuant to Section 3.13(d) hereof) and cause any REMIC created hereunder to fail to
qualify as a REMIC under the Code. The Trustee shall furnish the Master Servicer with any
powers of attorney and other documents necessary or appropriate to enable the Master
Servicer to service and administer the Mortgage Loans. The Trustee shall not be liable for
any action taken by the Master Servicer or any Subservicer pursuant to such powers of
attorney or other documents. In servicing and administering any Nonsubserviced Mortgage
Loan, the Master Servicer shall, to the extent not inconsistent with this Agreement, comply
with the Program Guide as if it were the originator of such Mortgage Loan and had retained
the servicing rights and obligations in respect thereof.
If the Mortgage relating to a Mortgage Loan did not have a lien senior to the
Mortgage Loan on the related Mortgaged Property as of the Cut-off Date, then the Master
Servicer, in such capacity, may not consent to the placing of a lien senior to that of the
Mortgage on the related Mortgaged Property. If the Mortgage relating to a Mortgage Loan had
a lien senior to the Mortgage Loan on the related Mortgaged Property as of the Cut-off Date,
then the Master Servicer, in such capacity, may consent to the refinancing of the prior
senior lien, provided that the following requirements are met:
(A) the Mortgagor's debt-to-income ratio resulting from such refinancing is
less than the original debt-to-income ratio as set forth on the Mortgage Loan
Schedule; provided, however, that in no instance shall the resulting Loan-to-Value
Ratio of such Mortgage Loan be higher than that permitted by the Program Guide; or
(B) the resulting Loan-to-Value Ratio of such Mortgage Loan is no higher
than the Loan-to-Value Ratio prior to such refinancing; provided, however, if such
refinanced mortgage loan is a "rate and term" mortgage loan (meaning, the Mortgagor
does not receive any cash from the refinancing), the Loan-to-Value Ratio may increase
to the extent of either (x) the reasonable closing costs of such refinancing or (y)
any decrease in the value of the related Mortgaged Property, if the Mortgagor is in
good standing as defined by the Program Guide.
(b) In connection with servicing and administering the Mortgage Loans, the Master
Servicer and any Affiliate of the Master Servicer (i) may perform services such as
appraisals and brokerage services that are customarily provided by Persons other than
servicers of mortgage loans, and shall be entitled to reasonable compensation therefor in
accordance with Section 3.10 and (ii) may, at its own discretion and on behalf of the
Trustee, obtain credit information in the form of a "credit score" from a credit repository.
(c) All costs incurred by the Master Servicer or by Subservicers in effecting the timely
payment of taxes and assessments on the properties subject to the Mortgage Loans shall not,
for the purpose of calculating monthly distributions to the Certificateholders, be added to
the amount owing under the related Mortgage Loans, notwithstanding that the terms of such
Mortgage Loan so permit, and such costs shall be recoverable to the extent permitted by
Section 3.10(a)(ii).
(d) The Master Servicer may enter into one or more agreements in connection with the
offering of pass-through certificates evidencing interests in one or more of the
Certificates providing for the payment by the Master Servicer of amounts received by the
Master Servicer as servicing compensation hereunder and required to cover certain Prepayment
Interest Shortfalls on the Mortgage Loans, which payment obligation will thereafter be an
obligation of the Master Servicer hereunder.
(e) The relationship of the Master Servicer (and of any successor to the Master Servicer)
to the Depositor under this Agreement is intended by the parties to be that of an
independent contractor and not that of a joint venturer, partner or agent.
Section 3.02. Subservicing Agreements Between Master Servicer and Subservicers; Enforcement
of Subservicers' Obligations.
(a) The Master Servicer may continue in effect Subservicing Agreements entered into by
Residential Funding and Subservicers prior to the execution and delivery of this Agreement,
and may enter into new Subservicing Agreements with Subservicers, for the servicing and
administration of all or some of the Mortgage Loans. Each Subservicer shall be either (i) an
institution the accounts of which are insured by the FDIC or (ii) another entity that
engages in the business of originating or servicing mortgage loans, and in either case shall
be authorized to transact business in the state or states in which the related Mortgaged
Properties it is to service are situated, if and to the extent required by applicable law to
enable the Subservicer to perform its obligations hereunder and under the Subservicing
Agreement, and in either case shall be a ▇▇▇▇▇▇▇ Mac, ▇▇▇▇▇▇ Mae or HUD approved mortgage
servicer. In addition, any Subservicer of a Mortgage Loan insured by the FHA must be an
FHA-approved servicer, and any Subservicer of a Mortgage Loan guaranteed by the VA must be a
VA-approved servicer. Each Subservicer of a Mortgage Loan shall be entitled to receive and
retain, as provided in the related Subservicing Agreement and in Section 3.07, the related
Subservicing Fee from payments of interest received on such Mortgage Loan after payment of
all amounts required to be remitted to the Master Servicer in respect of such Mortgage Loan.
For any Mortgage Loan that is a Nonsubserviced Mortgage Loan, the Master Servicer shall be
entitled to receive and retain an amount equal to the Subservicing Fee from payments of
interest. Unless the context otherwise requires, references in this Agreement to actions
taken or to be taken by the Master Servicer in servicing the Mortgage Loans include actions
taken or to be taken by a Subservicer on behalf of the Master Servicer. Each Subservicing
Agreement will be upon such terms and conditions as are generally required by, permitted by
or consistent with the Program Guide and are not inconsistent with this Agreement and as the
Master Servicer and the Subservicer have agreed. With the approval of the Master Servicer, a
Subservicer may delegate its servicing obligations to third-party servicers, but such
Subservicer will remain obligated under the related Subservicing Agreement. The Master
Servicer and a Subservicer may enter into amendments thereto or a different form of
Subservicing Agreement, and the form referred to or included in the Program Guide is merely
provided for information and shall not be deemed to limit in any respect the discretion of
the Master Servicer to modify or enter into different Subservicing Agreements; provided,
however, that any such amendments or different forms shall be consistent with and not
violate the provisions of either this Agreement or the Program Guide in a manner which would
materially and adversely affect the interests of the Certificateholders. The Program Guide
and any other Subservicing Agreement entered into between the Master Servicer and any
Subservicer shall require the Subservicer to accurately and fully report its borrower credit
files to each of the Credit Repositories in a timely manner.
(b) As part of its servicing activities hereunder, the Master Servicer, for the benefit
of the Trustee and the Certificateholders, shall use its best reasonable efforts to enforce
the obligations of each Subservicer under the related Subservicing Agreement, to the extent
that the non-performance of any such obligation would have a material and adverse effect on
a Mortgage Loan, including, without limitation, the obligation to purchase a Mortgage Loan
on account of defective documentation, as described in Section 2.02, or on account of a
breach of a representation or warranty, as described in Section 2.04. Such enforcement,
including, without limitation, the legal prosecution of claims, termination of Subservicing
Agreements, as appropriate, and the pursuit of other appropriate remedies, shall be in such
form and carried out to such an extent and at such time as the Master Servicer would employ
in its good faith business judgment and which are normal and usual in its general mortgage
servicing activities. The Master Servicer shall pay the costs of such enforcement at its own
expense, and shall be reimbursed therefor only (i) from a general recovery resulting from
such enforcement to the extent, if any, that such recovery exceeds all amounts due in
respect of the related Mortgage Loan or (ii) from a specific recovery of costs, expenses or
attorneys' fees against the party against whom such enforcement is directed. For purposes of
clarification only, the parties agree that the foregoing is not intended to, and does not,
limit the ability of the Master Servicer to be reimbursed for expenses that are incurred in
connection with the enforcement of a Seller's obligations and are reimbursable pursuant to
Section 3.10(a)(vii).
Section 3.03. Successor Subservicers.
The Master Servicer shall be entitled to terminate any Subservicing Agreement that
may exist in accordance with the terms and conditions of such Subservicing Agreement and
without any limitation by virtue of this Agreement; provided, however, that in the event of
termination of any Subservicing Agreement by the Master Servicer or the Subservicer, the
Master Servicer shall either act as servicer of the related Mortgage Loan or enter into a
Subservicing Agreement with a successor Subservicer which will be bound by the terms of the
related Subservicing Agreement. If the Master Servicer or any Affiliate of Residential
Funding acts as servicer, it will not assume liability for the representations and
warranties of the Subservicer which it replaces. If the Master Servicer enters into a
Subservicing Agreement with a successor Subservicer, the Master Servicer shall use
reasonable efforts to have the successor Subservicer assume liability for the
representations and warranties made by the terminated Subservicer in respect of the related
Mortgage Loans and, in the event of any such assumption by the successor Subservicer, the
Master Servicer may, in the exercise of its business judgment, release the terminated
Subservicer from liability for such representations and warranties.
Section 3.04. Liability of the Master Servicer.
Notwithstanding any Subservicing Agreement, any of the provisions of this Agreement
relating to agreements or arrangements between the Master Servicer or a Subservicer or
reference to actions taken through a Subservicer or otherwise, the Master Servicer shall
remain obligated and liable to the Trustee and Certificateholders for the servicing and
administering of the Mortgage Loans in accordance with the provisions of Section 3.01
without diminution of such obligation or liability by virtue of such Subservicing Agreements
or arrangements or by virtue of indemnification from the Subservicer or the Depositor and to
the same extent and under the same terms and conditions as if the Master Servicer alone were
servicing and administering the Mortgage Loans. The Master Servicer shall be entitled to
enter into any agreement with a Subservicer for indemnification of the Master Servicer and
nothing contained in this Agreement shall be deemed to limit or modify such indemnification.
Section 3.05. No Contractual Relationship Between Subservicer and Trustee or
Certificateholders.
Any Subservicing Agreement that may be entered into and any other transactions or
services relating to the Mortgage Loans involving a Subservicer in its capacity as such and
not as an originator shall be deemed to be between the Subservicer and the Master Servicer
alone and the Trustee and Certificateholders shall not be deemed parties thereto and shall
have no claims, rights, obligations, duties or liabilities with respect to the Subservicer
in its capacity as such except as set forth in Section 3.06. The foregoing provision shall
not in any way limit a Subservicer's obligation to cure an omission or defect or to
repurchase a Mortgage Loan as referred to in Section 2.02 hereof.
Section 3.06. Assumption or Termination of Subservicing Agreements by Trustee.
(a) In the event the Master Servicer shall for any reason no longer be the master
servicer (including by reason of an Event of Default), the Trustee, as successor Master
Servicer, its designee or its successor shall thereupon assume all of the rights and
obligations of the Master Servicer under each Subservicing Agreement that may have been
entered into. The Trustee, its designee or the successor servicer for the Trustee shall be
deemed to have assumed all of the Master Servicer's interest therein and to have replaced
the Master Servicer as a party to the Subservicing Agreement to the same extent as if the
Subservicing Agreement had been assigned to the assuming party except that the Master
Servicer shall not thereby be relieved of any liability or obligations under the
Subservicing Agreement.
(b) The Master Servicer shall, upon request of the Trustee but at the expense of the
Master Servicer, deliver to the assuming party all documents and records relating to each
Subservicing Agreement and the Mortgage Loans then being serviced and an accounting of
amounts collected and held by it and otherwise use its best efforts to effect the orderly
and efficient transfer of each Subservicing Agreement to the assuming party.
Section 3.07. Collection of Certain Mortgage Loan Payments; Deposits to Custodial Account.
(a) The Master Servicer shall make reasonable efforts to collect all payments called for
under the terms and provisions of the Mortgage Loans, and shall, to the extent such
procedures shall be consistent with this Agreement and the terms and provisions of any
related Primary Insurance Policy, follow such collection procedures as it would employ in
its good faith business judgment and which are normal and usual in its general mortgage
servicing activities. Consistent with the foregoing, the Master Servicer may in its
discretion (subject to the terms and conditions of the Assignment Agreement) (i) waive any
late payment charge or any prepayment charge or penalty interest in connection with the
prepayment of a Mortgage Loan and (ii) extend the Due Date for payments due on a Mortgage
Loan in accordance with the Program Guide, provided, however, that the Master Servicer shall
first determine that any such waiver or extension will not impair the coverage of any
related Primary Insurance Policy or materially adversely affect the lien of the related
Mortgage. Notwithstanding anything in this Section to the contrary, the Master Servicer or
any Subservicer shall not enforce any prepayment charge to the extent that such enforcement
would violate any applicable law. In the event of any such arrangement, the Master Servicer
shall make timely advances on the related Mortgage Loan during the scheduled period in
accordance with the amortization schedule of such Mortgage Loan without modification thereof
by reason of such arrangements unless otherwise agreed to by the Holders of the Classes of
Certificates affected thereby; provided, however, that no such extension shall be made if
any advance would be a Nonrecoverable Advance. Consistent with the terms of this Agreement,
the Master Servicer may also waive, modify or vary any term of any Mortgage Loan or consent
to the postponement of strict compliance with any such term or in any manner grant
indulgence to any Mortgagor if in the Master Servicer's determination such waiver,
modification, postponement or indulgence is not materially adverse to the interests of the
Certificateholders (taking into account any estimated Realized Loss that might result absent
such action), provided, however, that the Master Servicer may not modify materially or
permit any Subservicer to modify any Mortgage Loan, including without limitation any
modification that would change the Mortgage Rate, forgive the payment of any principal or
interest (unless in connection with the liquidation of the related Mortgage Loan or except
in connection with prepayments to the extent that such reamortization is not inconsistent
with the terms of the Mortgage Loan), capitalize any amounts owing on the Mortgage Loan by
adding such amount to the outstanding principal balance of the Mortgage Loan, or extend the
final maturity date of such Mortgage Loan, unless such Mortgage Loan is in default or, in
the judgment of the Master Servicer, such default is reasonably foreseeable. For purposes of
delinquency calculations, any capitalized Mortgage Loan shall be deemed to be current as of
the date of the related Servicing Modification. No such modification shall reduce the
Mortgage Rate (i) with respect to a fixed rate Mortgage Loan, (A) below one-half of the
Mortgage Rate as in effect on the Cut-off Date or (B) below the sum of the rates at which
the Servicing Fee and the Subservicing Fee with respect to such Mortgage Loan accrue or (ii)
with respect to an adjustable rate Mortgage Loan, (A) below the greater of (1) one-half of
the Mortgage Rate as in effect on the Cut-off Date and (2) one-half of the Mortgage Rate as
in effect on the date of the Servicing Modification or (B) below the sum of the rates at
which the Servicing Fee and the Subservicing Fee with respect to such Mortgage Loan accrue.
The final maturity date for any Mortgage Loan shall not be extended beyond the Maturity
Date. Also, the Stated Principal Balance of all Reportable Modified Mortgage Loans subject
to Servicing Modifications (measured at the time of the Servicing Modification and after
giving effect to any Servicing Modification) can be no more than five percent of the
aggregate Cut-off Date Principal Balance of the Mortgage Loans, unless such limit is
increased from time to time with the consent of the Rating Agencies. In addition, any
amounts owing on a Mortgage Loan added to the outstanding principal balance of such Mortgage
Loan must be fully amortized over the term of such Mortgage Loan, and such amounts may be
added to the outstanding principal balance of a Mortgage Loan only once during the life of
such Mortgage Loan. Also, the addition of such amounts described in the preceding sentence
shall be implemented in accordance with the Program Guide and may be implemented only by
Subservicers that have been approved by the Master Servicer for such purposes. In connection
with any Curtailment of a Mortgage Loan, the Master Servicer, to the extent not inconsistent
with the terms of the Mortgage Note and local law and practice, may permit the Mortgage Loan
to be re-amortized such that the Monthly Payment is recalculated as an amount that will
fully amortize the remaining Stated Principal Balance thereof by the original Maturity Date
based on the original Mortgage Rate; provided, that such reamortization shall not be
permitted if it would constitute a reissuance of the Mortgage Loan for federal income tax
purposes.
In addition, the Master Servicer and the Trustee on behalf of the Trust Fund shall
not exercise any right with respect to any Mortgage Loan to (i) accelerate the payment of
the outstanding principal balance of such Mortgage Loan plus any other amounts payable under
the related Mortgage Note or (ii) increase the related Mortgage Rate as a result of the
related Mortgagor's termination of employment with the originator of the Mortgage Loan.
(b) The Master Servicer shall establish and maintain a Custodial Account in which the
Master Servicer shall deposit or cause to be deposited on a daily basis, except as otherwise
specifically provided herein, the following payments and collections remitted by
Subservicers or received by it in respect of the Mortgage Loans subsequent to the Cut-off
Date (other than in respect of Monthly Payments due before or in the month of the Cut-off
Date):
(i) All payments on account of principal, including Principal Prepayments made by
Mortgagors on the Mortgage Loans and the principal component of any Subservicer
Advance or of any REO Proceeds received in connection with an REO Property for which
an REO Disposition has occurred;
(ii) All payments on account of interest at the Adjusted Mortgage Rate on the Mortgage
Loans, including the interest component of any Subservicer Advance or of any REO
Proceeds received in connection with an REO Property for which an REO Disposition has
occurred;
(iii) Insurance Proceeds, Subsequent Recoveries and Liquidation Proceeds (net of any
related expenses of the Subservicer);
(iv) All proceeds of any Mortgage Loans purchased pursuant to Section 2.02, 2.03, 2.04,
4.07, 4.08 or 9.01 (including amounts received from Residential Funding pursuant to
the last paragraph of Section 4 of the Assignment Agreement in respect of any
liability, penalty or expense that resulted from a breach of the representation and
warranty set forth in clause (cc) of Section 4 of the Assignment Agreement) and all
amounts required to be deposited in connection with the substitution of a Qualified
Substitute Mortgage Loan pursuant to Section 2.03 or 2.04; and
(v) Any amounts required to be deposited pursuant to Section 3.07(c) and any payments or
collections received in the nature of prepayment charges.
The foregoing requirements for deposit in the Custodial Account shall be exclusive,
it being understood and agreed that, without limiting the generality of the foregoing,
payments on the Mortgage Loans which are not part of the Trust Fund (consisting of Monthly
Payments due before or in the month of the Cut-off Date) and payments or collections
consisting of late payment charges or assumption fees may but need not be deposited by the
Master Servicer in the Custodial Account. In the event any amount not required to be
deposited in the Custodial Account is so deposited, the Master Servicer may at any time
withdraw such amount from the Custodial Account, any provision herein to the contrary
notwithstanding. The Custodial Account may contain funds that belong to one or more trust
funds created for mortgage pass-through certificates of other series and may contain other
funds respecting payments on mortgage loans belonging to the Master Servicer or serviced or
master serviced by it on behalf of others. Notwithstanding such commingling of funds, the
Master Servicer shall keep records that accurately reflect the funds on deposit in the
Custodial Account that have been identified by it as being attributable to the Mortgage
Loans. With respect to Insurance Proceeds, Liquidation Proceeds, REO Proceeds, Subsequent
Recoveries and the proceeds of the purchase of any Mortgage Loan pursuant to Sections 2.02,
2.03, 2.04, 4.07 and 4.08 received in any calendar month, the Master Servicer may elect to
treat such amounts as included in the Available Distribution Amount for the Distribution
Date in the month of receipt, but is not obligated to do so. If the Master Servicer so
elects, such amounts will be deemed to have been received (and any related Realized Loss
shall be deemed to have occurred) on the last day of the month prior to the receipt thereof.
(c) The Master Servicer shall use its best efforts to cause the institution maintaining
the Custodial Account to invest the funds in the Custodial Account attributable to the
Mortgage Loans in Permitted Investments which shall mature not later than the Certificate
Account Deposit Date next following the date of such investment (with the exception of the
Amount Held for Future Distribution) and which shall not be sold or disposed of prior to
their maturities. All income and gain realized from any such investment shall be for the
benefit of the Master Servicer as additional servicing compensation and shall be subject to
its withdrawal or order from time to time. The amount of any losses incurred in respect of
any such investments attributable to the investment of amounts in respect of the Mortgage
Loans shall be deposited in the Custodial Account by the Master Servicer out of its own
funds immediately as realized.
(d) The Master Servicer shall give written notice to the Trustee and the Depositor of any
change in the location of the Custodial Account and the location of the Certificate Account
prior to the use thereof.
Section 3.08. Subservicing Accounts; Servicing Accounts.
(a) In those cases where a Subservicer is servicing a Mortgage Loan pursuant to a
Subservicing Agreement, the Master Servicer shall cause the Subservicer, pursuant to the
Subservicing Agreement, to establish and maintain one or more Subservicing Accounts which
shall be an Eligible Account or, if such account is not an Eligible Account, shall generally
satisfy the requirements of the Program Guide and be otherwise acceptable to the Master
Servicer and each Rating Agency. The Subservicer will be required thereby to deposit into
the Subservicing Account on a daily basis all proceeds of Mortgage Loans received by the
Subservicer, less its Subservicing Fees and unreimbursed advances and expenses, to the
extent permitted by the Subservicing Agreement. If the Subservicing Account is not an
Eligible Account, the Master Servicer shall be deemed to have received such monies upon
receipt thereof by the Subservicer. The Subservicer shall not be required to deposit in the
Subservicing Account payments or collections in the nature of late charges or assumption
fees, or payments or collections received in the nature of prepayment charges to the extent
that the Subservicer is entitled to retain such amounts pursuant to the Subservicing
Agreement. On or before the date specified in the Program Guide, but in no event later than
the Determination Date, the Master Servicer shall cause the Subservicer, pursuant to the
Subservicing Agreement, to remit to the Master Servicer for deposit in the Custodial Account
all funds held in the Subservicing Account with respect to each Mortgage Loan serviced by
such Subservicer that are required to be remitted to the Master Servicer. The Subservicer
will also be required, pursuant to the Subservicing Agreement, to advance on such scheduled
date of remittance amounts equal to any scheduled monthly installments of principal and
interest less its Subservicing Fees on any Mortgage Loans for which payment was not received
by the Subservicer. This obligation to advance with respect to each Mortgage Loan will
continue up to and including the first of the month following the date on which the related
Mortgaged Property is sold at a foreclosure sale or is acquired by the Trust Fund by deed in
lieu of foreclosure or otherwise. All such advances received by the Master Servicer shall be
deposited promptly by it in the Custodial Account.
(b) The Subservicer may also be required, pursuant to the Subservicing Agreement, to
remit to the Master Servicer for deposit in the Custodial Account interest at the Adjusted
Mortgage Rate (or Modified Net Mortgage Rate plus the rate per annum at which the Servicing
Fee accrues in the case of a Modified Mortgage Loan) on any Curtailment received by such
Subservicer in respect of a Mortgage Loan from the related Mortgagor during any month that
is to be applied by the Subservicer to reduce the unpaid principal balance of the related
Mortgage Loan as of the first day of such month, from the date of application of such
Curtailment to the first day of the following month. Any amounts paid by a Subservicer
pursuant to the preceding sentence shall be for the benefit of the Master Servicer as
additional servicing compensation and shall be subject to its withdrawal or order from time
to time pursuant to Sections 3.10(a)(iv) and (v).
(c) In addition to the Custodial Account and the Certificate Account, the Master Servicer
shall for any Nonsubserviced Mortgage Loan, and shall cause the Subservicers for Subserviced
Mortgage Loans to, establish and maintain one or more Servicing Accounts and deposit and
retain therein all collections from the Mortgagors (or advances from Subservicers) for the
payment of taxes, assessments, hazard insurance premiums, Primary Insurance Policy premiums,
if applicable, or comparable items for the account of the Mortgagors. Each Servicing Account
shall satisfy the requirements for a Subservicing Account and, to the extent permitted by
the Program Guide or as is otherwise acceptable to the Master Servicer, may also function as
a Subservicing Account. Withdrawals of amounts related to the Mortgage Loans from the
Servicing Accounts may be made only to effect timely payment of taxes, assessments, hazard
insurance premiums, Primary Insurance Policy premiums, if applicable, or comparable items,
to reimburse the Master Servicer or Subservicer out of related collections for any payments
made pursuant to Sections 3.11 (with respect to the Primary Insurance Policy) and 3.12(a)
(with respect to hazard insurance), to refund to any Mortgagors any sums as may be
determined to be overages, to pay interest, if required, to Mortgagors on balances in the
Servicing Account or to clear and terminate the Servicing Account at the termination of this
Agreement in accordance with Section 9.01 or in accordance with the Program Guide. As part
of its servicing duties, the Master Servicer shall, and the Subservicers will, pursuant to
the Subservicing Agreements, be required to pay to the Mortgagors interest on funds in this
account to the extent required by law.
(d) The Master Servicer shall advance the payments referred to in the preceding
subsection that are not timely paid by the Mortgagors or advanced by the Subservicers on the
date when the tax, premium or other cost for which such payment is intended is due, but the
Master Servicer shall be required so to advance only to the extent that such advances, in
the good faith judgment of the Master Servicer, will be recoverable by the Master Servicer
out of Insurance Proceeds, Liquidation Proceeds or otherwise.
Section 3.09. Access to Certain Documentation and Information Regarding the Mortgage Loans.
In the event that compliance with this Section 3.09 shall make any Class of
Certificates legal for investment by federally insured savings and loan associations, the
Master Servicer shall provide, or cause the Subservicers to provide, to the Trustee, the
Office of Thrift Supervision or the FDIC and the supervisory agents and examiners thereof
access to the documentation regarding the Mortgage Loans required by applicable regulations
of the Office of Thrift Supervision, such access being afforded without charge but only upon
reasonable request and during normal business hours at the offices designated by the Master
Servicer. The Master Servicer shall permit such representatives to photocopy any such
documentation and shall provide equipment for that purpose at a charge reasonably
approximating the cost of such photocopying to the Master Servicer.
Section 3.10. Permitted Withdrawals from the Custodial Account.
(a) The Master Servicer may, from time to time as provided herein, make withdrawals from
the Custodial Account of amounts on deposit therein pursuant to Section 3.07 that are
attributable to the Mortgage Loans for the following purposes:
(i) to remit to the Trustee for deposit into the Certificate Account in the amounts and
in the manner provided for in Section 4.01;
(ii) to reimburse itself or the related Subservicer for previously unreimbursed Advances,
Servicing Advances or other expenses made pursuant to Sections 3.01, 3.07(a) 3.08,
3.11, 3.12(a), 3.14 and 4.04 or otherwise reimbursable pursuant to the terms of this
Agreement, such withdrawal right being limited to amounts received on the related
Mortgage Loans (including, for this purpose, REO Proceeds, Insurance Proceeds,
Liquidation Proceeds and proceeds from the purchase of a Mortgage Loan pursuant to
Section 2.02, 2.03, 2.04, 4.07, 4.08 or 9.01) which represent (A) Late Collections of
Monthly Payments for which any such advance was made in the case of Subservicer
Advances or Advances pursuant to Section 4.04 and (B) late recoveries of the payments
for which such advances were made in the case of Servicing Advances;
(iii) to pay to itself or the related Subservicer (if not previously retained by such
Subservicer) out of each payment received by the Master Servicer on account of
interest on a Mortgage Loan as contemplated by Sections 3.14 and 3.16, an amount
equal to that remaining portion of any such payment as to interest (but not in excess
of the Servicing Fee and the Subservicing Fee, if not previously retained) which,
when deducted, will result in the remaining amount of such interest being interest at
a rate per annum equal to the Net Mortgage Rate (or Modified Net Mortgage Rate in the
case of a Modified Mortgage Loan) on the amount specified in the amortization
schedule of the related Mortgage Loan as the principal balance thereof at the
beginning of the period respecting which such interest was paid after giving effect
to any previous Curtailments;
(iv) to pay to itself as additional servicing compensation any interest or investment
income earned on funds deposited in the Custodial Account that it is entitled to
withdraw pursuant to Section 3.07(c);
(v) to pay to itself as additional servicing compensation any Foreclosure Profits, and
any amounts remitted by Subservicers as interest in respect of Curtailments pursuant
to Section 3.08(b);
(vi) to pay to itself, a Subservicer, Residential Funding, the Depositor or any other
appropriate Person, as the case may be, with respect to each Mortgage Loan or
property acquired in respect thereof that has been purchased or otherwise transferred
pursuant to Section 2.02, 2.03, 2.04, 4.07, 4.08 or 9.01, all amounts received
thereon and not required to be distributed to Certificateholders as of the date on
which the related Stated Principal Balance or Purchase Price is determined;
(vii) to reimburse itself or the related Subservicer for any Nonrecoverable Advance or
Advances in the manner and to the extent provided in subsection (c) below, and any
Advance or Servicing Advance made in connection with a modified Mortgage Loan that is
in default or, in the judgment of the Master Servicer, default is reasonably
foreseeable pursuant to Section 3.07(a), to the extent the amount of the Advance or
Servicing Advance was added to the Stated Principal Balance of the Mortgage Loan in
the preceding calendar month;
(viii) to reimburse itself or the Depositor for expenses incurred by and reimbursable to it
or the Depositor pursuant to Section 3.14(c), 6.03, 10.01 or otherwise;
(ix) to reimburse itself for amounts expended by it (a) pursuant to Section 3.14 in good
faith in connection with the restoration of property damaged by an Uninsured Cause,
and (b), in connection with the liquidation of a Mortgage Loan or disposition of an
REO Property to the extent not otherwise reimbursed pursuant to clause (ii) or (viii)
above; and
(x) to withdraw any amount deposited in the Custodial Account that was not required to be
deposited therein pursuant to Section 3.07, including any payoff fees or penalties or
any other additional amounts payable to the Master Servicer or Subservicer pursuant
to the terms of the Mortgage Note.
(b) Since, in connection with withdrawals pursuant to clauses (ii), (iii), (v) and (vi),
the Master Servicer's entitlement thereto is limited to collections or other recoveries on
the related Mortgage Loan, the Master Servicer shall keep and maintain separate accounting,
on a Mortgage Loan by Mortgage Loan basis, for the purpose of justifying any withdrawal from
the Custodial Account pursuant to such clauses.
(c) The Master Servicer shall be entitled to reimburse itself or the related Subservicer
for any advance made in respect of a Mortgage Loan that the Master Servicer determines to be
a Nonrecoverable Advance by withdrawal from the Custodial Account of amounts on deposit
therein attributable to the Mortgage Loans on any Certificate Account Deposit Date
succeeding the date of such determination. Such right of reimbursement in respect of a
Nonrecoverable Advance relating to an Advance made pursuant to Section 4.04 on any such
Certificate Account Deposit Date shall be limited to an amount not exceeding the portion of
such advance previously paid to Certificateholders (and not theretofore reimbursed to the
Master Servicer or the related Subservicer).
Section 3.11. Maintenance of Primary Insurance Coverage.
(a) The Master Servicer shall not take, or permit any Subservicer to take, any action
which would result in noncoverage under any applicable Primary Insurance Policy of any loss
which, but for the actions of the Master Servicer or Subservicer, would have been covered
thereunder. To the extent coverage is available, the Master Servicer shall keep or cause to
be kept in full force and effect each such Primary Insurance Policy until the principal
balance of the related Mortgage Loan secured by a Mortgaged Property is reduced to 80% or
less of the Appraised Value at origination in the case of such a Mortgage Loan having a
Loan-to-Value Ratio at origination in excess of 80%, provided that such Primary Insurance
Policy was in place as of the Cut-off Date and the Master Servicer had knowledge of such
Primary Insurance Policy. The Master Servicer shall not cancel or refuse to renew any such
Primary Insurance Policy applicable to a Nonsubserviced Mortgage Loan, or consent to any
Subservicer canceling or refusing to renew any such Primary Insurance Policy applicable to a
Mortgage Loan subserviced by it, that is in effect at the date of the initial issuance of
the Certificates and is required to be kept in force hereunder unless the replacement
Primary Insurance Policy for such canceled or non-renewed policy is maintained with an
insurer whose claims-paying ability is acceptable to each Rating Agency for mortgage
pass-through certificates having a rating equal to or better than the lower of the
then-current rating or the rating assigned to the Certificates as of the Closing Date by
such Rating Agency.
(b) In connection with its activities as administrator and servicer of the Mortgage
Loans, the Master Servicer agrees to present or to cause the related Subservicer to present,
on behalf of the Master Servicer, the Subservicer, if any, the Trustee and
Certificateholders, claims to the insurer under any Primary Insurance Policies, in a timely
manner in accordance with such policies, and, in this regard, to take or cause to be taken
such reasonable action as shall be necessary to permit recovery under any Primary Insurance
Policies respecting defaulted Mortgage Loans. Pursuant to Section 3.07, any Insurance
Proceeds collected by or remitted to the Master Servicer under any Primary Insurance
Policies shall be deposited in the Custodial Account, subject to withdrawal pursuant to
Section 3.10.
Section 3.12. Maintenance of Fire Insurance and Omissions and Fidelity Coverage.
(a) The Master Servicer shall cause to be maintained for each Mortgage Loan (other than a
Cooperative Loan) fire insurance with extended coverage in an amount which is equal to the
lesser of the principal balance owing on such Mortgage Loan (together with the principal
balance of any mortgage loan secured by a lien that is senior to the Mortgage Loan) or 100
percent of the insurable value of the improvements; provided, however, that such coverage
may not be less than the minimum amount required to fully compensate for any loss or damage
on a replacement cost basis. To the extent it may do so without breaching the related
Subservicing Agreement, the Master Servicer shall replace any Subservicer that does not
cause such insurance, to the extent it is available, to be maintained. The Master Servicer
shall also cause to be maintained on property acquired upon foreclosure, or deed in lieu of
foreclosure, of any Mortgage Loan (other than a Cooperative Loan), fire insurance with
extended coverage in an amount which is at least equal to the amount necessary to avoid the
application of any co-insurance clause contained in the related hazard insurance policy.
Pursuant to Section 3.07, any amounts collected by the Master Servicer under any such
policies (other than amounts to be applied to the restoration or repair of the related
Mortgaged Property or property thus acquired or amounts released to the Mortgagor in
accordance with the Master Servicer's normal servicing procedures) shall be deposited in the
Custodial Account, subject to withdrawal pursuant to Section 3.10. Any cost incurred by the
Master Servicer in maintaining any such insurance shall not, for the purpose of calculating
monthly distributions to Certificateholders, be added to the amount owing under the Mortgage
Loan, notwithstanding that the terms of the Mortgage Loan so permit. Such costs shall be
recoverable by the Master Servicer out of related late payments by the Mortgagor or out of
Insurance Proceeds and Liquidation Proceeds to the extent permitted by Section 3.10. It is
understood and agreed that no earthquake or other additional insurance is to be required of
any Mortgagor or maintained on property acquired in respect of a Mortgage Loan other than
pursuant to such applicable laws and regulations as shall at any time be in force and as
shall require such additional insurance. Whenever the improvements securing a Mortgage Loan
(other than a Cooperative Loan) are located at the time of origination of such Mortgage Loan
in a federally designated special flood hazard area, the Master Servicer shall cause flood
insurance (to the extent available) to be maintained in respect thereof. Such flood
insurance shall be in an amount equal to the lesser of (i) the amount required to compensate
for any loss or damage to the Mortgaged Property on a replacement cost basis and (ii) the
maximum amount of such insurance available for the related Mortgaged Property under the
national flood insurance program (assuming that the area in which such Mortgaged Property is
located is participating in such program).In the event that the Master Servicer shall obtain
and maintain a blanket fire insurance policy with extended coverage insuring against hazard
losses on all of the Mortgage Loans, it shall conclusively be deemed to have satisfied its
obligations as set forth in the first sentence of this Section 3.12(a), it being understood
and agreed that such policy may contain a deductible clause, in which case the Master
Servicer shall, in the event that there shall not have been maintained on the related
Mortgaged Property a policy complying with the first sentence of this Section 3.12(a) and
there shall have been a loss which would have been covered by such policy, deposit in the
Certificate Account the amount not otherwise payable under the blanket policy because of
such deductible clause. Any such deposit by the Master Servicer shall be made on the
Certificate Account Deposit Date next preceding the Distribution Date which occurs in the
month following the month in which payments under any such policy would have been deposited
in the Custodial Account. In connection with its activities as administrator and servicer of
the Mortgage Loans, the Master Servicer agrees to present, on behalf of itself, the Trustee
and Certificateholders, claims under any such blanket policy.
(b) The Master Servicer shall obtain and maintain at its own expense and keep in full
force and effect throughout the term of this Agreement a blanket fidelity bond and an errors
and omissions insurance policy covering the Master Servicer's officers and employees and
other persons acting on behalf of the Master Servicer in connection with its activities
under this Agreement. The amount of coverage shall be at least equal to the coverage that
would be required by ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac, whichever is greater, with respect to the
Master Servicer if the Master Servicer were servicing and administering the Mortgage Loans
for ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac. In the event that any such bond or policy ceases to be in
effect, the Master Servicer shall obtain a comparable replacement bond or policy from an
issuer or insurer, as the case may be, meeting the requirements, if any, of the Program
Guide and acceptable to the Depositor. Coverage of the Master Servicer under a policy or
bond obtained by an Affiliate of the Master Servicer and providing the coverage required by
this Section 3.12(b) shall satisfy the requirements of this Section 3.12(b).
Section 3.13. Enforcement of Due-on-Sale Clauses; Assumption and Modification Agreements;
Certain Assignments.
(a) When any Mortgaged Property is conveyed by the Mortgagor, the Master Servicer or
Subservicer, to the extent it has knowledge of such conveyance, shall enforce any
due-on-sale clause contained in any Mortgage Note or Mortgage, to the extent permitted under
applicable law and governmental regulations, but only to the extent that such enforcement
will not adversely affect or jeopardize coverage under any Required Insurance Policy.
Notwithstanding the foregoing: (i) the Master Servicer shall not be deemed to be in default
under this Section 3.13(a) by reason of any transfer or assumption which the Master Servicer
is restricted by law from preventing; and (ii) if the Master Servicer determines that it is
reasonably likely that any Mortgagor will bring, or if any Mortgagor does bring, legal
action to declare invalid or otherwise avoid enforcement of a due-on-sale clause contained
in any Mortgage Note or Mortgage, the Master Servicer shall not be required to enforce the
due-on-sale clause or to contest such action.
(b) Subject to the Master Servicer's duty to enforce any due-on-sale clause to the extent
set forth in Section 3.13(a), in any case in which a Mortgaged Property is to be conveyed to
a Person by a Mortgagor, and such Person is to enter into an assumption or modification
agreement or supplement to the Mortgage Note or Mortgage which requires the signature of the
Trustee, or if an instrument of release signed by the Trustee is required releasing the
Mortgagor from liability on the Mortgage Loan, the Master Servicer is authorized, subject to
the requirements of the sentence next following, to execute and deliver, on behalf of the
Trustee, the assumption agreement with the Person to whom the Mortgaged Property is to be
conveyed and such modification agreement or supplement to the Mortgage Note or Mortgage or
other instruments as are reasonable or necessary to carry out the terms of the Mortgage Note
or Mortgage or otherwise to comply with any applicable laws regarding assumptions or the
transfer of the Mortgaged Property to such Person; provided, however, none of such terms and
requirements shall both constitute a "significant modification" effecting an exchange or
reissuance of such Mortgage Loan under the Code (or final, temporary or proposed Treasury
regulations promulgated thereunder) and cause any REMIC created hereunder to fail to qualify
as REMICs under the Code or the imposition of any tax on "prohibited transactions" or
"contributions" after the startup date under the REMIC Provisions. The Master Servicer shall
execute and deliver such documents only if it reasonably determines that (i) its execution
and delivery thereof will not conflict with or violate any terms of this Agreement or cause
the unpaid balance and interest on the Mortgage Loan to be uncollectible in whole or in
part, (ii) any required consents of insurers under any Required Insurance Policies have been
obtained and (iii) subsequent to the closing of the transaction involving the assumption or
transfer (A) the Mortgage Loan will continue to be secured by a first mortgage lien (or
junior lien of the same priority in relation to any senior mortgage loan, with respect to
any Mortgage Loan secured by a junior Mortgage) pursuant to the terms of the Mortgage, (B)
such transaction will not adversely affect the coverage under any Required Insurance
Policies, (C) the Mortgage Loan will fully amortize over the remaining term thereof, (D) no
material term of the Mortgage Loan (including the interest rate on the Mortgage Loan) will
be altered nor will the term of the Mortgage Loan be changed and (E) if the
seller/transferor of the Mortgaged Property is to be released from liability on the Mortgage
Loan, the buyer/transferee of the Mortgaged Property would be qualified to assume the
Mortgage Loan based on generally comparable credit quality and such release will not (based
on the Master Servicer's or Subservicer's good faith determination) adversely affect the
collectability of the Mortgage Loan. Upon receipt of appropriate instructions from the
Master Servicer in accordance with the foregoing, the Trustee shall execute any necessary
instruments for such assumption or substitution of liability as directed by the Master
Servicer. Upon the closing of the transactions contemplated by such documents, the Master
Servicer shall cause the originals or true and correct copies of the assumption agreement,
the release (if any), or the modification or supplement to the Mortgage Note or Mortgage to
be delivered to the Trustee or the Custodian and deposited with the Mortgage File for such
Mortgage Loan. Any fee collected by the Master Servicer or such related Subservicer for
entering into an assumption or substitution of liability agreement will be retained by the
Master Servicer or such Subservicer as additional servicing compensation.
(c) The Master Servicer or the related Subservicer, as the case may be, shall be entitled
to approve a request from a Mortgagor for a partial release of the related Mortgaged
Property, the granting of an easement thereon in favor of another Person, any alteration or
demolition of the related Mortgaged Property (or, with respect to a Cooperative Loan, the
related Cooperative Apartment) without any right of reimbursement or other similar matters
if it has determined, exercising its good faith business judgment in the same manner as it
would if it were the owner of the related Mortgage Loan, that the security for, and the
timely and full collectability of, such Mortgage Loan would not be adversely affected
thereby and that each REMIC created hereunder would continue to qualify as a REMIC under the
Code as a result thereof and that no tax on "prohibited transactions" or "contributions"
after the Startup Date would be imposed on any REMIC created hereunder as a result thereof.
Any fee collected by the Master Servicer or the related Subservicer for processing such a
request will be retained by the Master Servicer or such Subservicer as additional servicing
compensation.
(d) Subject to any other applicable terms and conditions of this Agreement, the Master
Servicer shall be entitled to approve an assignment in lieu of satisfaction with respect to
any Mortgage Loan, provided the obligee with respect to such Mortgage Loan following such
proposed assignment provides the Master Servicer with a "Lender Certification for Assignment
of Mortgage Loan" in the form attached hereto as Exhibit N, in form and substance
satisfactory to the Master Servicer, providing the following: (i) that the Mortgage Loan is
secured by Mortgaged Property located in a jurisdiction in which an assignment in lieu of
satisfaction is required to preserve lien priority, minimize or avoid mortgage recording
taxes or otherwise comply with, or facilitate a refinancing under, the laws of such
jurisdiction; (ii) that the substance of the assignment is, and is intended to be, a
refinancing of such Mortgage Loan and that the form of the transaction is solely to comply
with, or facilitate the transaction under, such local laws; (iii) that the Mortgage Loan
following the proposed assignment will have a rate of interest at least 0.25 percent below
or above the rate of interest on such Mortgage Loan prior to such proposed assignment; and
(iv) that such assignment is at the request of the borrower under the related Mortgage Loan.
Upon approval of an assignment in lieu of satisfaction with respect to any Mortgage Loan,
the Master Servicer shall receive cash in an amount equal to the unpaid principal balance of
and accrued interest on such Mortgage Loan and the Master Servicer shall treat such amount
as a Principal Prepayment in Full with respect to such Mortgage Loan for all purposes hereof.
Section 3.14. Realization Upon Defaulted Mortgage Loans.
(a) The Master Servicer shall foreclose upon or otherwise comparably convert (which may
include an REO Acquisition) the ownership of properties securing such of the Mortgage Loans
as come into and continue in default and as to which no satisfactory arrangements can be
made for collection of delinquent payments pursuant to Section 3.07. Alternatively, the
Master Servicer may take other actions in respect of a defaulted Mortgage Loan, which may
include (i) accepting a short sale (a payoff of the Mortgage Loan for an amount less than
the total amount contractually owed in order to facilitate a sale of the Mortgaged Property
by the Mortgagor) or permitting a short refinancing (a payoff of the Mortgage Loan for an
amount less than the total amount contractually owed in order to facilitate refinancing
transactions by the Mortgagor not involving a sale of the Mortgaged Property), (ii)
arranging for a repayment plan or (iii) agreeing to a modification in accordance with
Section 3.07. In connection with such foreclosure or other conversion or action, the Master
Servicer shall, consistent with Section 3.11, follow such practices and procedures as it
shall deem necessary or advisable, as shall be normal and usual in its general mortgage
servicing activities and as shall be required or permitted by the Program Guide; provided
that the Master Servicer shall not be liable in any respect hereunder if the Master Servicer
is acting in connection with any such foreclosure or other conversion or action in a manner
that is consistent with the provisions of this Agreement. The Master Servicer, however,
shall not be required to expend its own funds or incur other reimbursable charges in
connection with any foreclosure, or attempted foreclosure which is not completed, or towards
the correction of any default on a related senior mortgage loan, or towards the restoration
of any property unless it shall determine (i) that such restoration and/or foreclosure will
increase the proceeds of liquidation of the Mortgage Loan to Holders of Certificates of one
or more Classes after reimbursement to itself for such expenses or charges and (ii) that
such expenses and charges will be recoverable to it through Liquidation Proceeds, Insurance
Proceeds, or REO Proceeds (respecting which it shall have priority for purposes of
withdrawals from the Custodial Account pursuant to Section 3.10, whether or not such
expenses and charges are actually recoverable from related Liquidation Proceeds, Insurance
Proceeds or REO Proceeds). In the event of such a determination by the Master Servicer
pursuant to this Section 3.14(a), the Master Servicer shall be entitled to reimbursement of
its funds so expended pursuant to Section 3.10. In addition, the Master Servicer may pursue
any remedies that may be available in connection with a breach of a representation and
warranty with respect to any such Mortgage Loan in accordance with Sections 2.03 and 2.04.
However, the Master Servicer is not required to continue to pursue both foreclosure (or
similar remedies) with respect to the Mortgage Loans and remedies in connection with a
breach of a representation and warranty if the Master Servicer determines in its reasonable
discretion that one such remedy is more likely to result in a greater recovery as to the
Mortgage Loan. Upon the occurrence of a Cash Liquidation or REO Disposition, following the
deposit in the Custodial Account of all Insurance Proceeds, Liquidation Proceeds and other
payments and recoveries referred to in the definition of "Cash Liquidation" or "REO
Disposition," as applicable, upon receipt by the Trustee of written notification of such
deposit signed by a Servicing Officer, the Trustee or any Custodian, as the case may be,
shall release to the Master Servicer the related Mortgage File and the Trustee shall execute
and deliver such instruments of transfer or assignment prepared by the Master Servicer, in
each case without recourse, as shall be necessary to vest in the Master Servicer or its
designee, as the case may be, the related Mortgage Loan, and thereafter such Mortgage Loan
shall not be part of the Trust Fund. Notwithstanding the foregoing or any other provision of
this Agreement, in the Master Servicer's sole discretion with respect to any defaulted
Mortgage Loan or REO Property as to either of the following provisions, (i) a Cash
Liquidation or REO Disposition may be deemed to have occurred if substantially all amounts
expected by the Master Servicer to be received in connection with the related defaulted
Mortgage Loan or REO Property have been received, and (ii) for purposes of determining the
amount of any Liquidation Proceeds, Insurance Proceeds, REO Proceeds or other unscheduled
collections or the amount of any Realized Loss, the Master Servicer may take into account
minimal amounts of additional receipts expected to be received or any estimated additional
liquidation expenses expected to be incurred in connection with the related defaulted
Mortgage Loan or REO Property.
(b) In the event that title to any Mortgaged Property is acquired by the Trust Fund as an
REO Property by foreclosure or by deed in lieu of foreclosure, the deed or certificate of
sale shall be issued to the Trustee or to its nominee on behalf of Certificateholders.
Notwithstanding any such acquisition of title and cancellation of the related Mortgage Loan,
such REO Property shall (except as otherwise expressly provided herein) be considered to be
an Outstanding Mortgage Loan held in the Trust Fund until such time as the REO Property
shall be sold. Consistent with the foregoing for purposes of all calculations hereunder so
long as such REO Property shall be considered to be an Outstanding Mortgage Loan it shall be
assumed that, notwithstanding that the indebtedness evidenced by the related Mortgage Note
shall have been discharged, such Mortgage Note and the related amortization schedule in
effect at the time of any such acquisition of title (after giving effect to any previous
Curtailments and before any adjustment thereto by reason of any bankruptcy or similar
proceeding or any moratorium or similar waiver or grace period) remain in effect.
(c) In the event that the Trust Fund acquires any REO Property as aforesaid or otherwise
in connection with a default or imminent default on a Mortgage Loan, the Master Servicer on
behalf of the Trust Fund shall dispose of such REO Property within three full years after
the taxable year of its acquisition by the Trust Fund for purposes of Section 860G(a)(8) of
the Code (or such shorter period as may be necessary under applicable state (including any
state in which such property is located) law to maintain the status of each REMIC created
hereunder as a REMIC under applicable state law and avoid taxes resulting from such property
failing to be foreclosure property under applicable state law) or, at the expense of the
Trust Fund, request, more than 60 days before the day on which such grace period would
otherwise expire, an extension of such grace period unless the Master Servicer obtains for
the Trustee an Opinion of Counsel, addressed to the Trustee and the Master Servicer, to the
effect that the holding by the Trust Fund of such REO Property subsequent to such period
will not result in the imposition of taxes on "prohibited transactions" as defined in
Section 860F of the Code or cause any REMIC created hereunder to fail to qualify as a REMIC
(for federal (or any applicable State or local) income tax purposes) at any time that any
Certificates are outstanding, in which case the Trust Fund may continue to hold such REO
Property (subject to any conditions contained in such Opinion of Counsel). The Master
Servicer shall be entitled to be reimbursed from the Custodial Account for any costs
incurred in obtaining such Opinion of Counsel, as provided in Section 3.10. Notwithstanding
any other provision of this Agreement, no REO Property acquired by the Trust Fund shall be
rented (or allowed to continue to be rented) or otherwise used by or on behalf of the Trust
Fund in such a manner or pursuant to any terms that would (i) cause such REO Property to
fail to qualify as "foreclosure property" within the meaning of Section 860G(a)(8) of the
Code or (ii) any subject REMIC created hereunder to the imposition of any federal income
taxes on the income earned from such REO Property, including any taxes imposed by reason of
Section 860G(c) of the Code, unless the Master Servicer has agreed to indemnify and hold
harmless the Trust Fund with respect to the imposition of any such taxes.
(d) The proceeds of any Cash Liquidation, REO Disposition or purchase or repurchase of
any Mortgage Loan pursuant to the terms of this Agreement, as well as any recovery (other
than Subsequent Recoveries) resulting from a collection of Liquidation Proceeds, Insurance
Proceeds or REO Proceeds, will be applied in the following order of priority: first, to
reimburse the Master Servicer or the related Subservicer in accordance with Section
3.10(a)(ii); second, to the Certificateholders to the extent of accrued and unpaid interest
on the Mortgage Loan, and any related REO Imputed Interest, at the Net Mortgage Rate (or the
Modified Net Mortgage Rate in the case of a Modified Mortgage Loan) (less Deferred Interest,
if any), to the Due Date in the related Due Period prior to the Distribution Date on which
such amounts are to be distributed; third, to the Certificateholders as a recovery of
principal on the Mortgage Loan (or REO Property) (provided that if any such Class of
Certificates to which such Realized Loss was allocated is no longer outstanding, such
subsequent recover shall be distributed to the persons who were the Holders of such Class of
Certificates when it was retired); fourth, to all Servicing Fees and Subservicing Fees
payable therefrom (and the Master Servicer and the Subservicer shall have no claims for any
deficiencies with respect to such fees which result from the foregoing allocation); and
fifth, to Foreclosure Profits.
(e) In the event of a default on a Mortgage Loan one or more of whose obligors is not a
United States Person, in connection with any foreclosure or acquisition of a deed in lieu of
foreclosure (together, "foreclosure") in respect of such Mortgage Loan, the Master Servicer
shall cause compliance with the provisions of Treasury Regulation Section 1.1445-2(d)(3) (or
any successor thereto) necessary to assure that no withholding tax obligation arises with
respect to the proceeds of such foreclosure except to the extent, if any, that proceeds of
such foreclosure are required to be remitted to the obligors on such Mortgage Loan.
Section 3.15. Trustee to Cooperate; Release of Mortgage Files.
(a) Upon becoming aware of the payment in full of any Mortgage Loan, or upon the receipt
by the Master Servicer of a notification that payment in full will be escrowed in a manner
customary for such purposes, the Master Servicer shall immediately notify the Trustee (if it
holds the related Mortgage File) or the Custodian by a certification of a Servicing Officer
(which certification shall include a statement to the effect that all amounts received or to
be received in connection with such payment which are required to be deposited in the
Custodial Account pursuant to Section 3.07 have been or will be so deposited), substantially
in one of the forms attached hereto as Exhibit H requesting delivery to it of the Mortgage
File. Upon receipt of such certification and request, the Trustee shall promptly release, or
cause the Custodian to release, the related Mortgage File to the Master Servicer. The Master
Servicer is authorized to execute and deliver to the Mortgagor the request for reconveyance,
deed of reconveyance or release or satisfaction of mortgage or such instrument releasing the
lien of the Mortgage, together with the Mortgage Note with, as appropriate, written evidence
of cancellation thereon and to cause the removal from the registration on the MERS(R)System
of such Mortgage and to execute and deliver, on behalf of the Trustee and the
Certificateholders or any of them, any and all instruments of satisfaction or cancellation
or of partial or full release, including any applicable UCC termination statements. No
expenses incurred in connection with any instrument of satisfaction or deed of reconveyance
shall be chargeable to the Custodial Account or the Certificate Account.
(b) From time to time as is appropriate for the servicing or foreclosure of any Mortgage
Loan, the Master Servicer shall deliver to the Custodian, with a copy to the Trustee, a
certificate of a Servicing Officer substantially in one of the forms attached as Exhibit H
hereto, requesting that possession of all, or any document constituting part of, the
Mortgage File be released to the Master Servicer and certifying as to the reason for such
release and that such release will not invalidate any insurance coverage provided in respect
of the Mortgage Loan under any Required Insurance Policy. Upon receipt of the foregoing, the
Trustee shall deliver, or cause the Custodian to deliver, the Mortgage File or any document
therein to the Master Servicer. The Master Servicer shall cause each Mortgage File or any
document therein so released to be returned to the Trustee, or the Custodian as agent for
the Trustee when the need therefor by the Master Servicer no longer exists, unless (i) the
Mortgage Loan has been liquidated and the Liquidation Proceeds relating to the Mortgage Loan
have been deposited in the Custodial Account or (ii) the Mortgage File or such document has
been delivered directly or through a Subservicer to an attorney, or to a public trustee or
other public official as required by law, for purposes of initiating or pursuing legal
action or other proceedings for the foreclosure of the Mortgaged Property either judicially
or non-judicially, and the Master Servicer has delivered directly or through a Subservicer
to the Trustee a certificate of a Servicing Officer certifying as to the name and address of
the Person to which such Mortgage File or such document was delivered and the purpose or
purposes of such delivery. In the event of the liquidation of a Mortgage Loan, the Trustee
shall deliver the Request for Release with respect thereto to the Master Servicer upon the
Trustee's receipt of notification from the Master Servicer of the deposit of the related
Liquidation Proceeds in the Custodial Account.
(c) The Trustee or the Master Servicer on the Trustee's behalf shall execute and deliver
to the Master Servicer, if necessary, any court pleadings, requests for trustee's sale or
other documents necessary to the foreclosure or trustee's sale in respect of a Mortgaged
Property or to any legal action brought to obtain judgment against any Mortgagor on the
Mortgage Note or Mortgage or to obtain a deficiency judgment, or to enforce any other
remedies or rights provided by the Mortgage Note or Mortgage or otherwise available at law
or in equity. Together with such documents or pleadings (if signed by the Trustee), the
Master Servicer shall deliver to the Trustee a certificate of a Servicing Officer requesting
that such pleadings or documents be executed by the Trustee and certifying as to the reason
such documents or pleadings are required and that the execution and delivery thereof by the
Trustee shall not invalidate any insurance coverage under any Required Insurance Policy or
invalidate or otherwise affect the lien of the Mortgage, except for the termination of such
a lien upon completion of the foreclosure or trustee's sale.
Section 3.16. Servicing and Other Compensation; Eligible Master Servicing Compensation.
(a) The Master Servicer, as compensation for its activities hereunder, shall be entitled
to receive on each Distribution Date the amounts provided for by clauses (iii), (iv), (v)
and (vi) of Section 3.10(a), subject to clause (e) below. The amount of servicing
compensation provided for in such clauses shall be accounted for on a Mortgage
Loan-by-Mortgage Loan basis. In the event that Liquidation Proceeds, Insurance Proceeds and
REO Proceeds (net of amounts reimbursable therefrom pursuant to Section 3.10(a)(ii)) in
respect of a Cash Liquidation or REO Disposition exceed the unpaid principal balance of such
Mortgage Loan plus unpaid interest accrued thereon (including REO Imputed Interest) at a per
annum rate equal to the related Net Mortgage Rate (or the Modified Net Mortgage Rate in the
case of a Modified Mortgage Loan), the Master Servicer shall be entitled to retain therefrom
and to pay to itself and/or the related Subservicer, any Foreclosure Profits and any
Servicing Fee or Subservicing Fee considered to be accrued but unpaid.
(b) Additional servicing compensation in the form of payment charges, assumption fees,
late payment charges, investment income on amounts in the Custodial Account or the
Certificate Account or otherwise shall be retained by the Master Servicer or the Subservicer
to the extent provided herein, subject to clause (e) below.
(c) The Master Servicer shall be required to pay, or cause to be paid, all expenses
incurred by it in connection with its servicing activities hereunder (including payment of
premiums for the Primary Insurance Policies, if any, to the extent such premiums are not
required to be paid by the related Mortgagors, and the fees and expenses of the Trustee and
any Custodian) and shall not be entitled to reimbursement therefor except as specifically
provided in Sections 3.10 and 3.14.
(d) The Master Servicer's right to receive servicing compensation may not be transferred
in whole or in part except in connection with the transfer of all of its responsibilities
and obligations of the Master Servicer under this Agreement.
(e) Notwithstanding clauses (a) and (b) above, the amount of servicing compensation that
the Master Servicer shall be entitled to receive for its activities hereunder for the period
ending on each Distribution Date shall be reduced (but not below zero) by an amount equal to
Eligible Master Servicing Compensation (if any) for such Distribution Date. Such reduction
shall be applied during such period as follows: first, to any Servicing Fee or Subservicing
Fee to which the Master Servicer is entitled pursuant to Section 3.10(a)(iii); second, to
any income or gain realized from any investment of funds held in the Custodial Account or
the Certificate Account to which the Master Servicer is entitled pursuant to Sections
3.07(c) or 4.01(b), respectively; and third, to any amounts of servicing compensation to
which the Master Servicer is entitled pursuant to Section 3.10(a)(v) or (vi). In making such
reduction, the Master Servicer shall not withdraw from the Custodial Account any such amount
representing all or a portion of the Servicing Fee to which it is entitled pursuant to
Section 3.10(a)(iii); (ii) shall not withdraw from the Custodial Account or Certificate
Account any such amount to which it is entitled pursuant to Section 3.07(c) or 4.01(b) and
(iii) shall not withdraw from the Custodial Account any such amount of servicing
compensation to which it is entitled pursuant to Section 3.10(a)(v) or (vi). With respect
to any Distribution Date, Eligible Master Servicing Compensation shall be used on such
Distribution Date to cover and Prepayment Interest Shortfalls.
Section 3.17. Reports to the Trustee and the Depositor.
Not later than fifteen days after each Distribution Date, the Master Servicer shall
forward to the Trustee and the Depositor a statement, certified by a Servicing Officer,
setting forth the status of the Custodial Account as of the close of business on such
Distribution Date as it relates to the Mortgage Loans and showing, for the period covered by
such statement, the aggregate of deposits in or withdrawals from the Custodial Account in
respect of the Mortgage Loans for each category of deposit specified in Section 3.07 and
each category of withdrawal specified in Section 3.10.
Section 3.18. Annual Statement as to Compliance.
The Master Servicer shall deliver to the Depositor and the Trustee on or before the
earlier of (a) March 31 of each year, beginning with the first March 31 that occurs at least
six months after the Cut-off Date, or (b) with respect to any calendar year during which the
Depositor's annual report on Form 10-K is required to be filed in accordance with the
Exchange Act and the rules and regulations of the Commission, on or before the date on which
the Depositor's annual report on Form 10-K is required to be filed in accordance with the
Exchange Act and the rules and regulations of the Commission (or, in each case, if such day
is not a Business Day, the immediately preceding Business Day), an Officers' Certificate
stating, as to each signer thereof, that (i) a review of the activities of the Master
Servicer during the preceding calendar year related to its servicing of mortgage loans and
of its performance under the pooling and servicing agreements, including this Agreement, has
been made under such officers' supervision, (ii) to the best of such officers' knowledge,
based on such review, the Master Servicer has complied in all material respects with the
minimum servicing standards set forth in the Uniform Single Attestation Program for Mortgage
Bankers and has fulfilled all of its material obligations in all material respects
throughout such year, or, if there has been material noncompliance with such servicing
standards or a default in the fulfillment in all material respects of any such obligation
relating to this Agreement, such statement shall include a description of such noncompliance
or specify each such default, as the case may be, known to such officer and the nature and
status thereof and (iii) to the best of such officers' knowledge, each Subservicer has
complied in all material respects with the minimum servicing standards set forth in the
Uniform Single Attestation Program for Mortgage Bankers and has fulfilled all of its
material obligations under its Subservicing Agreement in all material respects throughout
such year, or if there has been material noncompliance with such servicing standards or a
material default in the fulfillment of such obligations relating to this Agreement,
specifying such statement shall include a description of such noncompliance or specify each
such default, as the case may be, known to such officer and the nature and status thereof.
Section 3.19. Annual Independent Public Accountants' Servicing Report.
On or before the earlier of (a) March 31 of each year, beginning with the first March
31 that occurs at least six months after the Cut-off Date, or (b) with respect to any
calendar year during which the Depositor's annual report on Form 10-K is required to be
filed in accordance with the Exchange Act and the rules and regulations of the Commission,
the date on which the Depositor's annual report on Form 10-K is required to be filed in
accordance with the Exchange Act and the rules and regulations of the Commission (or, in
each case, if such day is not a Business Day, the immediately preceding Business Day), the
Master Servicer at its expense shall cause a firm of independent public accountants which
shall be members of the American Institute of Certified Public Accountants to furnish a
report to the Depositor and the Trustee stating its opinion that, on the basis of an
examination conducted by such firm substantially in accordance with standards established by
the American Institute of Certified Public Accountants, the assertions made pursuant to
Section 3.18 regarding compliance with the minimum servicing standards set forth in the
Uniform Single Attestation Program for Mortgage Bankers during the preceding calendar year
are fairly stated in all material respects, subject to such exceptions and other
qualifications that, in the opinion of such firm, such accounting standards require it to
report. In rendering such statement, such firm may rely, as to matters relating to the
direct servicing of mortgage loans by Subservicers, upon comparable statements for
examinations conducted by independent public accountants substantially in accordance with
standards established by the American Institute of Certified Public Accountants (rendered
within one year of such statement) with respect to such Subservicers. In the event such firm
requires the Trustee to agree to the procedures performed by such firm, the Master Servicer
shall direct the Trustee in writing to so agree; it being understood and agreed that the
Trustee shall deliver such letter of agreement in conclusive reliance upon the direction of
the Master Servicer, and the Trustee shall not make any independent inquiry or investigation
as to, and shall have no obligation or liability in respect of, the sufficiency, validity or
correctness of such procedures.
Section 3.20. Right of the Depositor in Respect of the Master Servicer.
The Master Servicer shall afford the Depositor and the Trustee, upon reasonable
notice, during normal business hours access to all records maintained by the Master Servicer
in respect of its rights and obligations hereunder and access to officers of the Master
Servicer responsible for such obligations. Upon request, the Master Servicer shall furnish
the Depositor and the Trustee with its most recent financial statements and such other
information as the Master Servicer possesses regarding its business, affairs, property and
condition, financial or otherwise. The Master Servicer shall also cooperate with all
reasonable requests for information including, but not limited to, notices, tapes and copies
of files, regarding itself, the Mortgage Loans or the Certificates from any Person or
Persons identified by the Depositor or Residential Funding. The Depositor may, but is not
obligated to perform, or cause a designee to perform, any defaulted obligation of the Master
Servicer hereunder or exercise the rights of the Master Servicer hereunder; provided that
the Master Servicer shall not be relieved of any of its obligations hereunder by virtue of
such performance by the Depositor or its designee. Neither the Depositor nor the Trustee
shall have the responsibility or liability for any action or failure to act by the Master
Servicer and is not obligated to supervise the performance of the Master Servicer under this
Agreement or otherwise.
ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS
Section 4.01. Certificate Account.
(a) The Master Servicer acting as agent of the Trustee shall establish and maintain a
Certificate Account in which the Master Servicer shall deposit or cause to be deposited on
behalf of the Trustee on or before 2:00 P.M. New York time on each Certificate Account
Deposit Date by wire transfer of immediately available funds an amount equal to the sum of
(i) any Advance for the immediately succeeding Distribution Date, (ii) any amount required
to be paid pursuant to Section 3.12(a), (iii) any amount required to be deposited in the
Certificate Account pursuant to Section 3.16(e), Section 4.07 or Section 4.08, (iv) any
amount required to be paid pursuant to Section 9.01, (v) any prepayment charges on the
Mortgage Loans received during the related Prepayment Period and (vi) all other amounts
constituting the Available Distribution Amount for the immediately succeeding Distribution
Date.
(b) On or prior to the Business Day immediately following each Determination Date, the
Master Servicer shall determine any amounts owed by the Yield Maintenance Agreement Provider
under the Yield Maintenance Agreement and inform the Trustee in writing of the amount so
calculated.
(c) The Trustee shall, upon written request from the Master Servicer, invest or cause the
institution maintaining the Certificate Account to invest the funds in the Certificate
Account in Permitted Investments designated in the name of the Trustee for the benefit of
the Certificateholders, which shall mature not later than the Business Day next preceding
the Distribution Date next following the date of such investment (except that (i) if such
Permitted Investment is an obligation of the institution that maintains such account or a
fund for which such institution serves as custodian, then such Permitted Investment may
mature on such Distribution Date and (ii) any other investment may mature on such
Distribution Date if the Trustee shall advance funds on such Distribution Date to the
Certificate Account in the amount payable on such investment on such Distribution Date,
pending receipt thereof to the extent necessary to make distributions on the Certificates)
and shall not be sold or disposed of prior to maturity. All income and gain realized from
any such investment shall be for the benefit of the Master Servicer and shall be subject to
its withdrawal or order from time to time. The amount of any losses incurred in respect of
any such investments shall be deposited in the Certificate Account by the Master Servicer
out of its own funds immediately as realized.
Section 4.02. Distributions.
(a) On each Distribution Date, the Trustee (or the Paying Agent on behalf of the Trustee)
shall allocate and distribute the Available Distribution Amount, if any, for such date to
the interests issued in respect of REMIC I and REMIC II as specified in this Section.
(b) (1) On each Distribution Date, the following amounts, in the following order of
priority, shall be distributed by REMIC I to REMIC II on account of the REMIC I Regular
Interests:
(A) to the extent of the Available Distribution Amount, to the Holders of the REMIC I
Regular Interests, pro rata, in an amount equal to (A) the related
Uncertificated Accrued Interest for such Distribution Date, plus (B) any
amounts in respect thereof remaining unpaid from previous Distribution Dates.
Amounts payable as Uncertificated Accrued Interest in respect of REMIC I
Regular Interest ZZ shall be reduced when the REMIC I Overcollateralization
Amount is less than the REMIC I Required Overcollateralization Amount, by the
lesser of (x) the amount of such difference and (y) the REMIC I Regular
Interest ZZ Maximum Interest Deferral Amount, and such amount will be payable
to the Holders of REMIC I Regular Interests ▇-▇, ▇-▇, ▇-▇, ▇-▇, ▇-▇, ▇-▇, ▇-▇,
M-5 and B in the same proportion as the Overcollateralization Increase Amount
is allocated to the corresponding Class of Certificates, and the
Uncertificated Principal Balance of the REMIC I Regular Interest ZZ shall be
increased by such amount; and
(B) on each Distribution Date, to the Holders of REMIC I Regular Interests, in an amount
equal to the remainder of the Available Distribution Amount after the
distributions made pursuant to clause (i) above, allocated as follows (except
as provided below): (A) to the Holders of the REMIC I Regular Interest AA,
98.00% of such remainder until the Uncertificated Principal Balance of such
REMIC I Regular Interest is reduced to zero; (B) to the Holders of REMIC I
Regular Interests ▇-▇, ▇-▇, ▇-▇, ▇-▇, ▇-▇, ▇-▇, ▇-▇, M-5 and B, 1.00% of such
remainder in the same proportion as amounts are distributed in respect of
principal on the corresponding Class of Certificates; (C) to the Holders of
the REMIC I Regular Interest ZZ, 1.00% of such remainder; and (D) any
remaining amounts to the Holders of the Class R-I Certificates; provided,
however, that 98.00% and 2.00% of any principal payments that are attributable
to an Overcollateralization Reduction Amount shall be allocated to Holders of
the REMIC I Regular Interest AA and REMIC I Regular Interest ZZ, respectively;
(2) Notwithstanding the distributions described in this Section 4.02(b), distribution of
funds from the Certificate Account shall be made only in accordance with Section
4.02(c).
(c) On each Distribution Date (x) the Master Servicer on behalf of the Trustee or (y) the
Paying Agent appointed by the Trustee, shall distribute to each Certificateholder of record
on the next preceding Record Date (other than as provided in Section 9.01 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 with respect to each Class of Certificates, shall be
based on the aggregate of the Percentage Interests represented by Certificates of the
applicable Class held by such Holder of the following amounts, in the following order of
priority, subject to the provisions of Section 4.02(d)), to the extent of the Available
Distribution Amount on deposit in the Certificate Account with respect to clauses (i)
through (xii), and to the extent of the sum of the remaining Available Distribution Amount
and the Yield Maintenance Payments on deposit in the Certificate Account with respect to
clauses (xiii) through (xxii) (and, with respect to clause (xxi)(B) below, to the extent of
prepayment charges on deposit in the Certificate Account):
(i) to the Class A Certificateholders, the Class A Interest Distribution Amount, with
such amount allocated among the Class A Certificateholders on a pro rata basis;
(ii) to the Class M-1 Certificateholders from the amount, if any, of the Available
Distribution Amount remaining after the foregoing distributions, the Class M-1
Interest Distribution Amount;
(iii) to the Class M-2 Certificateholders from the amount, if any, of the Available
Distribution Amount remaining after the foregoing distributions, the Class M-2
Interest Distribution Amount;
(iv) to the Class M-3 Certificateholders from the amount, if any, of the Available
Distribution Amount remaining after the foregoing distributions, the Class M-3
Interest Distribution Amount;
(v) to the Class M-4 Certificateholders from the amount, if any, of the Available
Distribution Amount remaining after the foregoing distributions, the Class M-4
Interest Distribution Amount;
(vi) to the Class M-5 Certificateholders from the amount, if any, of the Available
Distribution Amount remaining after the foregoing distributions, the Class M-5
Interest Distribution Amount;
(vii) to the Class B Certificateholders from the amount, if any, of the Available
Distribution Amount remaining after the foregoing distributions, the Class B Interest
Distribution Amount;
(viii) to the Class A, Class M and Class B Certificateholders, from the amount, if any, of
the Available Distribution Amount remaining after the foregoing distributions, the
Principal Distribution Amount (other than the amounts set forth in clauses (b)(iv),
(b)(v), and (b)(vi) of the definition thereof), in the order of priority described in
Section 4.02(d) hereof, until the Certificate Principal Balances of the Class A,
Class M and Class B Certificates have been reduced to zero;
(ix) to the Class A, Class M and Class B Certificateholders, from the amount, if any, of
Excess Cash Flow, an amount equal to the principal portion of Realized Losses
previously allocated to reduce the Certificate Principal Balance of any Class of the
Class A, Class M and Class B Certificates and remaining unreimbursed, but only to the
extent of Subsequent Recoveries for that Distribution Date, which amount shall be
included in the Principal Distribution Amount and paid in accordance with Section
4.02(d) hereof, until the Certificate Principal Balances of the Class A, Class M and
Class B Certificates have been reduced to zero;
(x) to the Class A, Class M and Class B Certificateholders, from the amount, if any, of
Excess Cash Flow remaining after the foregoing distributions, an amount equal to the
principal portion of Realized Losses on the Mortgage Loans during the immediately
preceding Prepayment Period, which amount shall be included in the Principal
Distribution Amount and paid in accordance with Section 4.02(d) hereof, until the
Certificate Principal Balances of the Class A, Class M and Class B Certificates have
been reduced to zero;
(xi) to the Class A, Class M and Class B Certificateholders, from the amount, if any, of
the Excess Cash Flow remaining after the foregoing distributions, the
Overcollateralization Increase Amount for such Distribution Date, which amount shall
be included in the Principal Distribution Amount and paid in accordance with Section
4.02(d) hereof, until the Certificate Principal Balances of the Class A, Class M and
Class B Certificates have been reduced to zero;
(xii) to the Class A, Class M and Class B Certificateholders from the amount, if any, of
the Excess Cash Flow remaining after the foregoing distributions, the amount of any
Prepayment Interest Shortfalls allocated thereto for such Distribution Date, on a pro
rata basis based on Prepayment Interest Shortfalls previously allocated thereto that
remain unreimbursed, to the extent not covered by Eligible Master Servicing
Compensation on such Distribution Date;
(xiii) to the Class A, Class M and Class B Certificateholders from the amount, if any, of
the Excess Cash Flow remaining after the foregoing distributions, the amount of any
Prepayment Interest Shortfalls previously allocated thereto on any prior Distribution
Date that remain unreimbursed, together with interest thereon at the applicable
Pass-Through Rate, on a pro rata basis based on Prepayment Interest Shortfalls
previously allocated thereto that remain unreimbursed;
(xiv) from the amount, if any, of the Excess Cash Flow remaining after the foregoing
distributions, to pay the Class A Certificates, on a pro rata basis, based on the
amount of Class A Net WAC Cap Shortfall Carry-Forward Amount previously allocated
thereto that remain unreimbursed, the amount of any Class A Net WAC Cap Shortfall
Carry-Forward Amounts remaining unpaid as of such Distribution Date and then to the
Class M Certificates and Class B Certificates, in their order of payment priority,
the amount of any Class M Net WAC Cap Shortfall Carry-Forward Amounts or Class B Net
WAC Cap Shortfall Carry-Forward Amounts, as applicable, remaining unpaid as of such
Distribution Date;
(xv) to the Class A, Class M and Class B Certificates on a pro rata basis, based on the
amount of Relief Act Shortfalls allocated thereto on such Distribution Date, from the
amount, if any, of the Excess Cash Flow remaining after the foregoing distributions,
the amount of any Relief Act Shortfalls allocated to those Certificates with respect
to such Distribution Date;
(xvi) to the Class A, Class M and Class B Certificateholders, from the amount, if any, of
the Excess Cash Flow remaining after the foregoing distributions, the principal
portion of any Realized Losses previously allocated to those Certificates and
remaining unreimbursed, which amount shall be allocated first, to the Class A
Certificateholders on a pro rata basis, based on their respective principal portion
of any Realized Losses previously allocated thereto that remain unreimbursed, and
then to the Class M and Class B Certificates, in their order of payment priority;
(xvii) to the Class B Certificates and Class M-5 Certificates, 50% of the amount of Excess
Cash Flow remaining after the foregoing distributions, paid first to the Class B
Certificates until the Certificate Principal Balance of the Class B Certificates has
been reduced to zero and then paid to the Class M-5 Certificates until the
Certificate Principal Balance of the Class M-5 Certificates has been reduced to zero.
(xviii) to the Class SB Certificates, (A) from the amount, if any, of the Excess Cash Flow
remaining after the foregoing distributions, the sum of (I) Accrued Certificate
Interest thereon, (II) the amount of any Overcollateralization Reduction Amount for
such Distribution Date and (III) for any Distribution Date after the Certificate
Principal Balance of each Class of Class A Certificates, Class M Certificates and
Class B Certificates has been reduced to zero, the Overcollateralization Amount, and
(B) from prepayment charges on deposit in the Certificate Account, any prepayment
charges received on the Mortgage Loans during the related Prepayment Period; and
(xix) to the Class R-II Certificateholders, the balance, if any, of the Excess Cash Flow.
(d) On each Distribution Date, the Principal Distribution Amount will be paid as follows:
(i) the Class A Principal Distribution Amount shall be distributed, sequentially, to the
Class A-1, Class A-2 and Class A-3 Certificates, in that order, in each case until
the Certificate Principal Balances thereof have been reduced to zero; provided that
on or after the first Distribution Date on which the Certificate Principal Balances
of the Class M Certificates have been reduced to zero, holders of the Class A-1
Certificates, Class A-2 Certificates and Class A-3 Certificates will receive such
portion of the Class A Principal Distribution Amount, on a pro rata basis, until the
Certificate Principal Balances thereof have been reduced to zero;
(ii) the Class M-1 Principal Distribution Amount shall be distributed to the Class M-1
Certificates, until the Certificate Principal Balance thereof has been reduced to
zero;
(iii) the Class M-2 Principal Distribution Amount shall be distributed to the Class M-2
Certificates, until the Certificate Principal Balance thereof has been reduced to
zero;
(iv) the Class M-3 Principal Distribution Amount shall be distributed to the Class M-3
Certificates, until the Certificate Principal Balance thereof has been reduced to
zero;
(v) the Class M-4 Principal Distribution Amount shall be distributed to the Class M-4
Certificates, until the Certificate Principal Balance thereof has been reduced to
zero;
(vi) the Class M-5 Principal Distribution Amount shall be distributed to the Class M-5
Certificates, until the Certificate Principal Balance thereof has been reduced to
zero; and
(vii) the Class B Principal Distribution Amount shall be distributed to the Class B
Certificates, until the Certificate Principal Balance thereof has been reduced to
zero;
(e) Notwithstanding the foregoing clauses (c) and (d), upon the reduction of the
Certificate Principal Balance of a Class of Class A, Class M and Class B Certificates to
zero, such Class of Certificates will not be entitled to further distributions pursuant to
Section 4.02 (other than in respect of Subsequent Recoveries).
(f) Notwithstanding the foregoing, on any Distribution Date, the amounts allocated from
Excess Cash Flow pursuant to clauses (c)(x) and (c)(xi) of this Section 4.02 on such
Distribution Date shall be paid first from the Available Distribution Amount for such
Distribution Date and second from any Yield Maintenance Payment for such Distribution Date.
(g) Any Prepayment Interest Shortfalls on the Mortgage Loans which are not covered by
Eligible Master Servicing Compensation as described in Section 3.16 and Relief Act
Shortfalls on the Mortgage Loans will be allocated among the Class A, Class M and Class B
Certificates pro rata in accordance with the amount of Accrued Certificate Interest payable
on such Distribution Date absent such shortfalls. Any such uncovered Prepayment Interest
Shortfalls will be paid solely pursuant to Section 4.02(c)(xvi) and (xvii) to the extent
funds are available therefor. Any such Relief Act Shortfalls will be paid solely pursuant to
Section 4.02(c)(xix) to the extent funds are available therefor.
(h) To the extent on any Distribution Date for which Deferred Interest exists on such
Distribution Date, the Deferred Interest Shortfall, if any, shall result in a reduction in
Accrued Certificate Interest on the Class A Certificates and Class M Certificates, which
reduction shall be allocated among the Class A Certificates and Class M Certificates on a
pro rata basis, based on the amount of Accrued Certificate Interest on such Classes of
Certificates.
(i) 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).
(j) Each distribution with respect to a Book-Entry Certificate shall be paid to the
Depository, as Holder thereof, and the Depository shall be responsible for crediting the
amount of such distribution to the accounts of its Depository Participants in accordance
with its normal procedures. Each Depository Participant shall be responsible for disbursing
such distribution to the Certificate Owners that it represents and to each indirect
participating brokerage firm (a "brokerage firm" or "indirect participating firm") for which
it acts as agent. Each brokerage firm shall be responsible for disbursing funds to the
Certificate Owners that it represents. None of the Trustee, the Certificate Registrar, the
Depositor or the Master Servicer shall have any responsibility therefor except as otherwise
provided by this Agreement or applicable law.
(k) Except as otherwise provided in Section 9.01, if the Master Servicer anticipates that
a final distribution with respect to any Class of Certificates will be made on 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 prior calendar month. In the event that
Certificateholders required to surrender their Certificates pursuant to Section 9.01(c) do
not surrender their Certificates for final cancellation, the Trustee shall cause funds
distributable with respect to such Certificates to be held in the Certificate Account for
the benefit of such Certificateholders as provided in Section 9.01(d).
Section 4.03. Statements to Certificateholders; Statements to Rating Agencies; Exchange Act
Reporting.
(a) Concurrently with each distribution charged to the Certificate Account and with
respect to each Distribution Date the Master Servicer shall forward to the Trustee and the
Trustee shall forward by mail or otherwise make available electronically on its website
(which may be obtained by any Certificateholder by telephoning the Trustee at (800)
934-6802) to each Holder and the Depositor a statement setting forth the following
information as to each Class of Certificates, in each case to the extent applicable:
(i) (A) the amount of such distribution to the Certificateholders of such Class
applied to reduce the Certificate Principal Balance thereof, and (B) the aggregate
amount included therein representing Principal Prepayments;
(ii) the amount of such distribution to Holders of such Class of Certificates allocable to
interest;
(iii) if the distribution to the Holders of such Class of Certificates is less than the
full amount that would be distributable to such Holders if there were sufficient
funds available therefor, the amount of the shortfall;
(iv) the amount of any Advance by the Master Servicer with respect to the Mortgage Loans
pursuant to Section 4.04;
(v) the number of Mortgage Loans and the aggregate Stated Principal Balance of the
Mortgage Loans after giving effect to the distribution of principal on such
Distribution Date;
(vi) the aggregate Certificate Principal Balance of each Class of the Certificates, after
giving effect to the amounts distributed on such Distribution Date, separately
identifying any reduction thereof due to Realized Losses other than pursuant to an
actual distribution of principal;
(vii) on the basis of the most recent reports furnished to it by Subservicers, (a) the
number and aggregate principal balances of the Mortgage Loans that are Delinquent (1)
one month, (2) two months and (3) three or more months and the number and aggregate
principal balance of the Mortgage Loans that are in foreclosure, (b) the number and
aggregate principal balances of the Mortgage Loans that are Reportable Modified
Mortgage Loans that are Delinquent (1) one month, (2) two months and (3) three or
more months and the number and aggregate principal balance of the Mortgage Loans that
are Reportable Modified Mortgage Loans that are in foreclosure and are REO Property,
indicating in each case capitalized Mortgage Loans, other Servicing Modifications and
totals, and (c) for all Mortgage Loans that are Reportable Modified Mortgage Loans,
the number and aggregate Stated Principal Balance of the Mortgage Loans that are
Reportable Modified Mortgage Loans that have been liquidated, the subject of pay-offs
and that have been repurchased by the Master Servicer or Seller;
(viii) the number, aggregate principal balance and book value of any REO Properties;
(ix) the aggregate Accrued Certificate Interest remaining unpaid, if any, for each Class
of Certificates, after giving effect to the distribution made on such Distribution
Date;
(x) the aggregate amount of Realized Losses for such Distribution Date and the aggregate
amount of Realized Losses on the Mortgage Loans incurred since the Cut-off Date;
(xi) the Pass-Through Rate on each Class of Certificates and the Net WAC Cap Rate;
(xii) the weighted average of the Maximum Net Mortgage Rates on the Mortgage Loans;
(xiii) the Deferred Interest Shortfall, Class A Net WAC Cap Shortfall, Class A Net WAC Cap
Shortfall Carry-Forward Amount, Class M Net WAC Cap Shortfall, Class M Net WAC Cap
Shortfall Carry-Forward Amount, Class B Net WAC Cap Shortfall, Class B Net WAC Cap
Shortfall Carry-Forward Amount and Prepayment Interest Shortfalls;
(xiv) the Overcollateralization Amount and the Required Overcollateralization Amount
following such Distribution Date;
(xv) the number and aggregate principal balance of Mortgage Loans repurchased under
Section 4.07 or Section 4.08;
(xvi) the aggregate amount of any recoveries on previously foreclosed loans from
Residential Funding due to a breach of representation or warranty;
(xvii) the weighted average remaining term to maturity of the Mortgage Loans after giving
effect to the amounts distributed on such Distribution Date;
(xviii) the weighted average Mortgage Rates of the Mortgage Loans after giving effect to the
amounts distributed on such Distribution Date;
(xix) the amount if any, to be paid by a Derivative Counterparty under a Derivative
Contract;
(xx) the aggregate amount of Deferred Interest added to the Stated Principal Balance of
the Mortgage Loans; and
(xxi) the amount of any Yield Maintenance Payments payable to the Trustee on behalf of the
Trust Fund and any Yield Maintenance Termination Payment payable to the Trustee on
behalf of the Trust Fund.
In the case of information furnished pursuant to clauses (i) and (ii) above, the
amounts shall be expressed as a dollar amount per Certificate with a $1,000 denomination. In
addition to the statement provided to the Trustee as set forth in this Section 4.03(a), the
Master Servicer shall provide to any manager of a trust fund consisting of some or all of
the Certificates, upon reasonable request, such additional information as is reasonably
obtainable by the Master Servicer at no additional expense to the Master Servicer. Also, at
the request of a Rating Agency, the Master Servicer shall provide the information relating
to the Reportable Modified Mortgage Loans substantially in the form attached hereto as
Exhibit S to such Rating Agency within a reasonable period of time; provided, however, that
the Master Servicer shall not be required to provide such information more than four times
in a calendar year to any Rating Agency.
(b) Within a reasonable period of time after the end of each calendar year, the Master
Servicer shall prepare, or cause to be prepared, and the Trustee shall forward, or cause to
be forwarded, upon the Trustee's receipt thereof to each Person who at any time during the
calendar year was the Holder of a Certificate, other than a Class R Certificate, a statement
containing the information set forth in clauses (i) and (ii) of subsection (a) above
aggregated for such calendar year or applicable portion thereof during which such Person was
a Certificateholder. Such obligation of the Master Servicer and Trustee shall be deemed to
have been satisfied to the extent that substantially comparable information shall be
provided by the Master Servicer and Trustee pursuant to any requirements of the Code.
(c) As soon as reasonably practicable, upon the written request of any Class SB or Class
R Certificateholder, the Master Servicer shall provide the requesting Certificateholder with
such information as is necessary and appropriate, in the Master Servicer's sole discretion,
for purposes of satisfying applicable reporting requirements under Rule 144A.
(d) The Master Servicer shall, on behalf of the Depositor and in respect of the Trust
Fund, sign and cause to be filed with the Commission any periodic reports required to be
filed under the provisions of the Exchange Act, and the rules and regulations of the
Commission thereunder. In connection with the preparation and filing of such periodic
reports, the Trustee shall timely provide to the Master Servicer (I) a list of
Certificateholders as shown on the Certificate Register as of the end of each calendar year,
(II) copies of all pleadings, other legal process and any other documents relating to any
claims, charges or complaints involving the Trustee, as trustee hereunder, or the Trust Fund
that are received by the Trustee, (III) notice of all matters that, to the actual knowledge
of a Responsible Officer of the Trustee, have been submitted to a vote of the
Certificateholders, other than those matters that have been submitted to a vote of the
Certificateholders at the request of the Depositor or the Master Servicer, and (IV) notice
of any failure of the Trustee to make any distribution to the Certificateholders as required
pursuant to this Agreement. Neither the Master Servicer nor the Trustee shall have any
liability with respect to the Master Servicer's failure to properly prepare or file such
periodic reports resulting from or relating to the Master Servicer's inability or failure to
obtain any information not resulting from the Master Servicer's own negligence or willful
misconduct. Any Form 10-K filed with the Commission in connection with this clause (d) shall
include a certification, signed by the senior officer in charge of the servicing functions
of the Master Servicer, in the form attached as Exhibit R-1 hereto or such other form as may
be required or permitted by the Commission (the "Form 10-K Certification"), in compliance
with Rule 13a-14 and 15d-14 under the Exchange Act and any additional directives of the
Commission. In connection with the Form 10-K Certification, the Trustee shall provide the
Master Servicer with a back-up certification substantially in the form attached hereto as
Exhibit R-2. This Section 4.03(e) may be amended in accordance with this Agreement without
the consent of the Certificateholders.
Section 4.04. Distribution of Reports to the Trustee and the Depositor; Advances by the
Master Servicer.
(a) Prior to the close of business on the Business Day next succeeding each Determination
Date, the Master Servicer shall furnish a written statement (which may be in a mutually
agreeable electronic format) to the Trustee, any Paying Agent and the Depositor (the
information in such statement to be made available to Certificateholders by the Master
Servicer on request) (provided that the Master Servicer shall use its best efforts to
deliver such written statement not later than 12:00 P.M. New York time on the second
Business Day prior to the Distribution Date) setting forth (i) the Available Distribution
Amounts, (ii) the amounts required to be withdrawn from the Custodial Account and deposited
into the Certificate Account on the immediately succeeding Certificate Account Deposit Date
pursuant to clause (iii) of Section 4.01(a), (iii) the amount of Prepayment Interest
Shortfalls, Class A Net WAC Cap Shortfall, Class M Net WAC Cap Shortfall, Class B New WAC
Cap Shortfall, Class A Net WAC Cap Shortfall Carry-Forward Amounts, Class M Net WAC Cap
Shortfall Carry-Forward Amounts and Class B Net WAC Cap Shortfall Carry-Forward Amounts,
(iv) the Yield Maintenance Payment, if any, for such Distribution Date and (v) the amount
payable by the Derivative Counterparties to the Trustee under the Derivative Contracts as
provided in Section 4.11. The determination by the Master Servicer of such amounts shall, in
the absence of obvious error, be presumptively deemed to be correct for all purposes
hereunder and the Trustee shall be protected in relying upon the same without any
independent check or verification.
(b) On or before 2:00 P.M. New York time on each Certificate Account Deposit Date, the
Master Servicer shall either (i) remit to the Trustee for deposit in the Certificate Account
from its own funds, or funds received therefor from the Subservicers, an amount equal to the
Advances to be made by the Master Servicer in respect of the related Distribution Date,
which shall be in an aggregate amount equal to the sum of (A) the aggregate amount of
Monthly Payments other than Balloon Payments (with each interest portion thereof adjusted to
a per annum rate equal to the Net Mortgage Rate), less the amount of any related Servicing
Modifications, Deferred Interest, if any, Debt Service Reductions or reductions in the
amount of interest collectable from the Mortgagor pursuant to the Relief Act or similar
legislation or regulations then in effect, on the Outstanding Mortgage Loans as of the
related Due Date in the related Due Period, which Monthly Payments were due during the
related Due Period and not received as of the close of business as of the related
Determination Date; provided that no Advance shall be made if it would be a Nonrecoverable
Advance and (B) with respect to each Balloon Loan delinquent in respect of its Balloon
Payment as of the close of business on the related Determination Date, an amount equal to
the excess, if any, of interest on the unpaid principal balance thereof (with each interest
portion thereof adjusted to per annum rate equal to the Net Mortgage Rate) over any payments
of interest (with each interest portion thereof adjusted to a per annum rate equal to the
Net Mortgage Rate) received from the related Mortgagor as of the close of business on the
related Determination Date and allocable to the Due Date during the related Due Period for
each month until such Balloon Loan is finally liquidated, (ii) withdraw from amounts on
deposit in the Custodial Account and deposit in the Certificate Account all or a portion of
the Amount Held for Future Distribution in discharge of any such Advance, or (iii) make
advances in the form of any combination of clauses (i) and (ii) aggregating the amount of
such Advance. Any portion of the Amount Held for Future Distribution so used shall be
replaced by the Master Servicer by deposit in the Certificate Account on or before 11:00
A.M. New York time on any future Certificate Account Deposit Date to the extent that funds
attributable to the Mortgage Loans that are available in the Custodial Account for deposit
in the Certificate Account on such Certificate Account Deposit Date shall be less than
payments to Certificateholders required to be made on the following Distribution Date. The
Master Servicer shall be entitled to use any Advance made by a Subservicer as described in
Section 3.07(b) that has been deposited in the Custodial Account on or before such
Distribution Date as part of the Advance made by the Master Servicer pursuant to this
Section 4.04. The determination by the Master Servicer that it has made a Nonrecoverable
Advance or that any proposed Advance, if made, would constitute a Nonrecoverable Advance,
shall be evidenced by a certificate of a Servicing Officer delivered to the Depositor and
the Trustee. In the event that the Master Servicer determines as of the Business Day
preceding any Certificate Account Deposit Date that it will be unable to deposit in the
Certificate Account an amount equal to the Advance required to be made for the immediately
succeeding Distribution Date, it shall give notice to the Trustee of its inability to
advance (such notice may be given by telecopy), not later than 3:00 P.M., New York time, on
such Business Day, specifying the portion of such amount that it will be unable to deposit.
Not later than 3:00 P.M., New York time, on the Certificate Account Deposit Date the Trustee
shall, unless by 12:00 Noon, New York time, on such day the Trustee shall have been notified
in writing (by telecopy) that the Master Servicer shall have directly or indirectly
deposited in the Certificate Account such portion of the amount of the Advance as to which
the Master Servicer shall have given notice pursuant to the preceding sentence, pursuant to
Section 7.01, (a) terminate all of the rights and obligations of the Master Servicer under
this Agreement in accordance with Section 7.01 and (b) assume the rights and obligations of
the Master Servicer as successor Master Servicer hereunder, including the obligation to
deposit in the Certificate Account an amount equal to the Advance for the immediately
succeeding Distribution Date. In connection with the preceding sentence, the Trustee shall
deposit all funds it receives pursuant to this Section 4.04(b) into the Certificate Account.
Section 4.05. Allocation of Realized Losses.
(a) 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
Modifications, 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 in the month in which such Distribution
Date occurs. The amount of each Realized Loss shall be evidenced by an Officers' Certificate.
(b) All Realized Losses on the Mortgage Loans shall be allocated as follows:
first, to Excess Cash Flow as provided in clause (b)(v) of the definition of
"Principal Distribution Amount", to the extent of the Excess Cash Flow for such
Distribution Date;
second, in reduction of the Overcollateralization Amount, until such amount has been
reduced to zero or until the aggregate Certificate Principal Balance of the Class A,
Class M and Class B Certificates equals the aggregate Stated Principal Balance of the
Mortgage Loans;
third, to the Class B Certificates, until the Certificate Principal thereof has been
reduced to zero;
fourth, to the Class M-5 Certificates, until the Certificate Principal Balance
thereof has been reduced to zero;
fifth, to the Class M-4 Certificates, until the Certificate Principal Balance thereof
has been reduced to zero;
sixth, to the Class M-3 Certificates, until the Certificate Principal Balance thereof
has been reduced to zero;
seventh, to the Class M-2 Certificates, until the Certificate Principal Balance
thereof has been reduced to zero;
eighth, to the Class M-1 Certificates, until the Certificate Principal Balance
thereof has been reduced to zero; and
tenth, to the Class A Certificates on a pro rata basis, until the Certificate
Principal Balances thereof have been reduced to zero.
(c) All allocations 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 in the case of an
interest portion of a Realized Loss. Any allocation of the principal portion of Realized
Losses (other than Debt Service Reductions) to the Class A, Class M and Class B 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 Certificate Principal Balance of the Class
A Certificates, Class M Certificates and Class B Certificates below the aggregate Stated
Principal Balance of the Mortgage Loans, as applicable. Allocations of the interest portions
of Realized Losses (other than any interest rate reduction resulting from a Servicing
Modification) shall be made by operation of the definition of "Accrued Certificate Interest"
and by operation of the provisions of Section 4.02(c). 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(c). All Realized
Losses and all 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.
(d) All Realized Losses on the Mortgage Loans shall be allocated on each Distribution
Date to the REMIC I Regular Interests, as follows: first, to Uncertificated Accrued Interest
payable to the REMIC I Regular Interests AA and ZZ up to an aggregate amount equal to the
excess of (a) the REMIC I Interest Loss Allocation Amount over (b) Prepayment Interest
Shortfalls (to the extent not covered by Compensating Interest) relating to the Mortgage
Loans for such Distribution Date, 98% and 2%, respectively; second, to the Uncertificated
Principal Balances of the REMIC I Regular Interests AA and ZZ up to an aggregate amount
equal to the REMIC I Principal Loss Allocation Amount, 98% and 2%, respectively; third, to
the Uncertificated Principal Balances of REMIC I Regular Interests AA, 98%, B, 1% and ZZ,
1%, until the Uncertificated Principal Balance of REMIC I Regular Interest B has been
reduced to zero; fourth, to the Uncertificated Principal Balances of REMIC I Regular
Interests AA, 98%, M-5, 1% and ZZ, 1%, until the Uncertificated Principal Balance of REMIC I
Regular Interest M-5 has been reduced to zero; fifth, to the Uncertificated Principal
Balances of REMIC I Regular Interests AA, 98%, M-4, 1% and ZZ, 1%, until the Uncertificated
Principal Balance of REMIC I Regular Interest M-4 has been reduced to zero; sixth, to the
Uncertificated Principal Balances of REMIC I Regular Interests AA, 98%, M-3, 1% and ZZ, 1%,
until the Uncertificated Principal Balance of REMIC I Regular Interest M-3 has been reduced
to zero; seventh, to the Uncertificated Principal Balances of REMIC I Regular Interests AA,
98%, M-2, 1% and ZZ, 1%, until the Uncertificated Principal Balance of REMIC I Regular
Interest M-2 has been reduced to zero; eighth, to the Uncertificated Principal Balances of
REMIC I Regular Interests AA, 98%, M-1, 1% and ZZ, 1%, until the Uncertificated Principal
Balance of REMIC I Regular Interest M-1 has been reduced to zero; ninth, to the
Uncertificated Principal Balances of REMIC I Regular Interests AA, 98%, A-3, 1%, and ZZ, 1%,
until the Uncertificated Principal Balances of REMIC I Regular Interest A-3 has been reduced
to zero; tenth, to the Uncertificated Principal Balances of REMIC I Regular Interests AA,
98%, A-2, 1%, and ZZ, 1%, until the Uncertificated Principal Balances of REMIC I Regular
Interest A-2 has been reduced to zero; and eleventh, to the Uncertificated Principal
Balances of REMIC I Regular Interests AA, 98%, A-1, 1%, and ZZ, 1%, until the Uncertificated
Principal Balances of REMIC I Regular Interest A-1 has been reduced to zero.
(e) Realized Losses allocated to the Excess Cash Flow or the Overcollateralization Amount
pursuant to paragraphs (a), (b) or (c) of this Section, the definition of Accrued
Certificate Interest and the operation of Section 4.02(c) shall be deemed allocated to the
Class SB Certificates. Realized Losses allocated to the Class SB Certificates shall, to the
extent such Realized Losses represent Realized Losses on an interest portion, be allocated
to the REMIC II Regular Interest SB-IO. Realized Losses allocated to the Excess Cash Flow
pursuant to paragraph (b) of this Section shall be deemed to reduce Accrued Certificate
Interest on the REMIC I Regular Interest SB-IO. Realized Losses allocated to the
Overcollateralization Amount pursuant to paragraph (b) of this Section shall be deemed first
to reduce the principal balance of the REMIC II Regular Interest SB-PO until such principal
balance shall have been reduced to zero and thereafter to reduce accrued and unpaid interest
on the REMIC II Regular Interest SB-IO.
Section 4.06. Reports of Foreclosures and Abandonment of Mortgaged Property.
The Master Servicer or the Subservicers shall file information returns with respect
to the receipt of mortgage interest received in a trade or business, the reports of
foreclosures and abandonments of any Mortgaged Property and the informational returns
relating to cancellation of indebtedness income with respect to any Mortgaged Property
required by Sections 6050H, 6050J and 6050P of the Code, respectively, and deliver to the
Trustee an Officers' Certificate on or before March 31 of each year, beginning with the
first March 31 that occurs at least six months after the Cut-Off Date, stating that such
reports have been filed. Such reports shall be in form and substance sufficient to meet the
reporting requirements imposed by such Sections 6050H, 6050J and 6050P of the Code.
Section 4.07. Optional Purchase of Defaulted Mortgage Loans.
As to any Mortgage Loan which is delinquent in payment by 90 days or more, the Master
Servicer may, at its option, purchase such Mortgage Loan from the Trustee at the Purchase
Price therefor; provide, that any such Mortgage Loan that becomes 90 days or more delinquent
during any given Calendar Quarter shall only be eligible for purchase pursuant to this
Section during the period beginning on the first Business Day of the following Calendar
Quarter and ending at the close of business on the second to the last Business Day of such
following Calendar Quarter. Such option if not exercised shall not thereafter be reinstated
as to any Mortgage Loan related unless the delinquency is cured and the Mortgage Loan
thereafter again becomes delinquent in payment by 90 days or more in a subsequent Calendar
Quarter. If at any time the Master Servicer makes a payment to the Certificate Account
covering the amount of the Purchase Price for such a Mortgage Loan, and the Master Servicer
provides to the Trustee a certification signed by a Servicing Officer stating that the
amount of such payment has been deposited in the Certificate Account, then the Trustee shall
execute the assignment of such Mortgage Loan at the request of the Master Servicer without
recourse to the Master Servicer which shall succeed to all the Trustee's right, title and
interest in and to such Mortgage Loan, and all security and documents relative thereto. Such
assignment shall be an assignment outright and not for security. The Master Servicer will
thereupon own such Mortgage, and all such security and documents, free of any further
obligation to the Trustee or the Certificateholders with respect thereto.
Section 4.08. Limited Mortgage Loan Repurchase Right.
The Limited Repurchase Right Holder will have the irrevocable option at any time to
purchase any of the Mortgage Loans from the Trustee at the Purchase Price, up to a maximum
of five Mortgage Loans. In the event that this option is exercised as to any five Mortgage
Loans in the aggregate, this option will thereupon terminate. If at any time the Limited
Repurchase Right Holder makes a payment to the Certificate Account covering the amount of
the Purchase Price for such a Mortgage Loan, and the Limited Repurchase Right Holder
provides to the Trustee a certification signed by a Servicing Officer stating that the
amount of such payment has been deposited in the Certificate Account, then the Trustee shall
execute the assignment of such Mortgage Loan at the request of the Limited Repurchase Right
Holder without recourse to the Limited Repurchase Right Holder which shall succeed to all
the Trustee's right, title and interest in and to such Mortgage Loan, and all security and
documents relative thereto. Such assignment shall be an assignment outright and not for
security. The Limited Repurchase Right Holder will thereupon own such Mortgage, and all such
security and documents, free of any further obligation to the Trustee or the
Certificateholders with respect thereto. Any tax on "prohibited transactions" (as defined in
Section 860F(a)(2) of the Code) imposed on any REMIC relating to the exercise of the option
provided in this Section 4.08 shall in no event be payable by the Trustee.
Section 4.09. The Yield Maintenance Agreement.
(a) On the Closing Date, the Trustee shall, for the benefit of the Class A, Class M and
Class SB Certificates, enter into the Yield Maintenance Agreement.
(b) The Trustee shall deposit or cause to be deposited any amount received under the
Yield Maintenance Agreement into the Certificate Account on the date such amount is received
from the Yield Maintenance Agreement Provider under the Yield Maintenance Agreement
(including Yield Maintenance Agreement Termination Payments, if any). All Yield Maintenance
Payments received under the Yield Maintenance Agreement shall be distributed as part of
Excess Cash Flow in accordance with the priorities set forth in Section 4.02(c) hereof,
whereas, all Yield Maintenance Agreement Termination Payments received under the Yield
Maintenance Agreement shall be used as set forth in Section 4.09(e) hereof. Neither the
Yield Maintenance Agreement nor any Yield Maintenance Payments (including Yield Maintenance
Termination Payments) constitute a part of any REMIC created hereunder and to the extent any
Yield Maintenance Payments are included as part of Excess Cash Flow they are so for
definition purposes only.
(c) Subject to Sections 8.01 and 8.02 hereof, the Trustee agrees to comply with the terms
of the Yield Maintenance Agreement and to enforce the terms and provisions thereof against
the Yield Maintenance Agreement Provider at the written direction of the Holders of Class A
and Class M Certificates entitled to at least 51% of the Voting Rights of such Classes of
Certificates, or if the Trustee does not receive such direction from such
Certificateholders, then at the written direction of Residential Funding.
(d) The Trustee and the Master Servicer shall treat the holders of each Class of
Certificates (other than the Class SB Certificates and Class R Certificates) as having
entered into a notional principal contract with the holders of the Class SB Certificates.
Pursuant to each such notional principal contract, the holder of the Class SB Certificates
shall be treated as having agreed to pay the amounts set forth in Sections 4.02(c)(x)
through (xvi) to the holders of the Certificates (other than the Class SB Certificates and
Class R Certificates) in accordance with the terms of this Agreement. Any payments to the
Certificates from amounts deemed received in respect of this notional principal contract
shall not be payments with respect to a "regular interest" in a REMIC within the meaning of
Code Section 860G(a)(1).
(e) In the event that the Yield Maintenance Agreement, or any replacement thereof,
terminates prior to the Distribution Date in December 2010, the Master Servicer, but at no
expense to the Master Servicer, on behalf of the Trustee, to the extent that the termination
value under such Yield Maintenance Agreement is sufficient therefor and only to the extent
of the Yield Maintenance Agreement Termination Payment received from the Yield Maintenance
Agreement Provider, shall (i) cause a new yield maintenance provider to assume the
obligations of such terminated yield maintenance agreement provider or (ii) cause a new
yield maintenance agreement provider to enter into a new interest rate yield maintenance
agreement with the Trust Fund having substantially similar terms as those set forth in the
terminated Yield Maintenance Agreement. Any Yield Maintenance Agreement Termination Payment
having a termination value which is not sufficient to comply with clauses (i) and (ii) of
this Section 4.09(e) shall be included in the definition of Yield Maintenance Payment herein
and may be distributed as Excess Cash Flow pursuant to Section 4.02(c) herein.
Section 4.10. [Reserved].
Section 4.11. Derivative Contracts.
(a) The Trustee shall, at the written direction of the Master Servicer, on behalf of the
Trust Fund, enter into Derivative Contracts, solely for the benefit of the Class SB
Certificates. Any such Derivative Contract shall constitute a fully prepaid agreement. The
Master Servicer shall determine, in its sole discretion, whether any Derivative Contract
conforms to the requirements of clauses (b) and (c) of this Section 4.11. Any acquisition
of a Derivative Contract shall be accompanied by an appropriate amendment to this Agreement,
including an Opinion of Counsel, as provided in Section 11.01, and either (i) an Opinion of
Counsel to the effect that the existence of the Derivative Contract will not adversely
affect the availability of the exemptive relief afforded under ERISA by U.S. Department of
Labor Prohibited Transaction Exemption ("PTE") 94-29, as most recently amended, 67 Fed. Reg.
54487 (Aug. 22, 2002), to the Holders of the Class A Certificates, as of the date the
Derivative Contract is acquired by the Trustee; or (ii) the consent of each holder of a
Class A Certificate to the acquisition of such Derivative Contract. All collections,
proceeds and other amounts in respect of the Derivative Contracts payable by the Derivative
Counterparty shall be distributed to the Class SB Certificates on the Distribution Date
following receipt thereof by the Trustee on behalf of the Trust Fund. In no event shall such
an instrument constitute a part of any REMIC created hereunder. In addition, in the event
any such instrument is deposited, the Trust Fund shall be deemed to be divided into two
separate and discrete sub-Trusts. The assets of one such sub-Trust shall consist of all the
assets of the Trust other than such instrument and the assets of the other sub-Trust shall
consist solely of such instrument.
(b) Any Derivative Contract that provides for any payment obligation on the part of the
Trust Fund must (i) be without recourse to the assets of the Trust Fund, (ii) contain a
non-petition covenant provision from the Derivative Counterparty, (iii) limit payment dates
thereunder to Distribution Dates and (iv) contain a provision limiting any cash payments due
to the Derivative Counterparty on any day under such Derivative Contract solely to funds
available therefor in the Certificate Account available to make payments to the Holders of
the Class SB Certificates on such Distribution Date.
(c) Each Derivative Contract must (i) provide for the direct payment of any amounts by
the Derivative Counterparty thereunder to the Certificate Account at least one Business Day
prior to the related Distribution Date, (ii) contain an assignment of all of the Trust
Fund's rights (but none of its obligations) under such Derivative Contract to the Trustee on
behalf the Class SB Certificateholders and shall include an express consent to the
Derivative Counterparty to such assignment, (iii) provide that in the event of the
occurrence of an Event of Default, such Derivative Contract shall terminate upon the
direction of a majority Percentage Interest of the Class SB Certificates, and (iv) prohibit
the Derivative Counterparty from "setting-off' or "netting" other obligations of the Trust
Fund and its Affiliates against such Derivative Counterparty's payment obligations
thereunder.
Section 4.12. Tax Treatment of Yield Maintenance Payments.
For federal income tax purposes, each holder of a Class A, Class M or Class SB
Certificate is deemed to own an undivided beneficial ownership interest in a REMIC regular
interest and the right to receive payments received by the Trustee, on behalf of the Trust
Fund, pursuant to the Yield Maintenance Agreement in respect of the amounts set forth in
Section 4.09(b) which right to receive such payments shall not be attributable to any asset
or amount owed by any REMIC created hereunder.
ARTICLE V
THE CERTIFICATES
Section 5.01. The Certificates.
(a) The Class A, Class M, Class B, Class SB and Class R Certificates shall be
substantially in the forms set forth in Exhibits A, B, C, D and E, respectively, and shall,
on original issue, be executed and delivered by the Trustee to the Certificate Registrar for
authentication and delivery to or upon the order of the Depositor upon receipt by the
Trustee or one or more Custodians of the documents specified in Section 2.01. The Class A
and Class M-1, Certificates shall be issuable in minimum dollar denominations of $25,000 and
integral multiples of $1 in excess thereof. The Class M-2, Class M-3, Class M-4, and Class
M-5 Certificates shall be issuable in minimum dollar denominations of $250,000 and integral
multiples of $1 in excess thereof. The Class B Certificates shall be issuable in minimum
dollar denominations of $100,000 and integral multiples of $1 in excess thereof The Class SB
Certificates shall be issuable in registered, certificated form in minimum percentage
interests of 5.00% and integral multiples of 0.01% in excess thereof. Each Class of Class R
Certificates shall be issued in registered, certificated form in minimum percentage
interests of 20.00% and integral multiples of 0.01% in excess thereof; provided, however,
that one Class R Certificate of each Class will be issuable to the REMIC Administrator as
"tax matters person" pursuant to Section 10.01(c) in a minimum denomination representing a
Percentage Interest of not less than 0.01%. The Certificates shall be executed by manual or
facsimile signature on behalf of an authorized officer of the Trustee. Certificates bearing
the manual or facsimile signatures of individuals who were at any time the proper officers
of the Trustee shall bind the Trustee, notwithstanding that such individuals or any of them
have ceased to hold such offices prior to the authentication and delivery of such
Certificate or did not hold such offices at the date of such Certificates. No Certificate
shall be entitled to any benefit under this Agreement, or be valid for any purpose, unless
there appears on such Certificate a certificate of authentication substantially in the form
provided for herein executed by the Certificate Registrar by manual signature, and such
certificate upon any Certificate shall be conclusive evidence, and the only evidence, that
such Certificate has been duly authenticated and delivered hereunder. All Certificates shall
be dated the date of their authentication.
(b) The Class A, Class M and Class B Certificates shall initially be issued as one or
more Certificates registered in the name of the Depository or its nominee and, except as
provided below, registration of such 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 Certificate Owners shall hold their
respective Ownership Interests in and to each such Class A, Class M and Class B Certificate
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 Trustee, the Master Servicer and the Depositor may for all purposes (including
the making of payments due on the respective Classes of Book-Entry Certificates) deal with
the Depository as the authorized representative of the Certificate Owners with respect to
the respective Classes of Book-Entry Certificates for the purposes of exercising the rights
of Certificateholders hereunder. The rights of Certificate Owners with respect to the
respective Classes of Book-Entry Certificates shall be limited to those established by law
and agreements between such Certificate Owners and the Depository Participants and brokerage
firms representing such Certificate Owners. Multiple requests and directions from, and votes
of, the Depository as Holder of any Class of Book-Entry Certificates with respect to any
particular matter shall not be deemed inconsistent if they are made with respect to
different Certificate Owners. The Trustee may establish a reasonable record date in
connection with solicitations of consents from or voting by Certificateholders and shall
give notice to the Depository of such record date.
In addition, if an Event of Default has occurred and is continuing, each Certificate
Owner materially adversely affected thereby may at its option request a Definitive
Certificate evidencing such Certificate Owner's Percentage Interest in the related Class of
Certificates. In order to make such request, such Certificate Owner shall, subject to the
rules and procedures of the Depository, provide the Depository or the related Depository
Participant with directions for the Trustee to exchange or cause the exchange of the
Certificate Owner's interest in such Class of Certificates for an equivalent Percentage
Interest in fully registered definitive form. Upon receipt by the Trustee of instruction
from the Depository directing the Trustee to effect such exchange (such instructions to
contain information regarding the Class of Certificates and the Certificate Principal
Balance being exchanged, the Depository Participant account to be debited with the decrease,
the registered holder of and delivery instructions for the Definitive Certificates and any
other information reasonably required by the Trustee), (i) the Trustee shall instruct the
Depository to reduce the related Depository Participant's account by the aggregate
Certificate Principal Balance of the Definitive Certificates, (ii) the Trustee shall
execute, authenticate and deliver, in accordance with the registration and delivery
instructions provided by the Depository, a Definitive Certificate evidencing such
Certificate Owner's Percentage Interest in such Class of Certificates and (iii) the Trustee
shall execute and authenticate a new Book-Entry Certificate reflecting the reduction in the
aggregate Certificate Principal Balance of such Class of Certificates by the amount of the
Definitive Certificates.
If (i)(A) the Depositor advises the Trustee in writing that the Depository is no
longer willing or able to properly discharge its responsibilities as Depository and (B) the
Depositor is unable to locate a qualified successor or (ii) the Depositor notifies the
Depository of its intent to terminate the book-entry system and, upon receipt of notice of
such intent from the Depository, the Depository Participants holding beneficial interest in
the Book-Entry Certificates agree to initiate such termination, the Trustee shall notify all
Certificate Owners, through the Depository, of the occurrence of any such event and of the
availability of Definitive Certificates to Certificate Owners requesting the same. Upon
surrender to the Trustee of the Book-Entry Certificates by the Depository, accompanied by
registration instructions from the Depository for registration of transfer, the Trustee
shall issue the Definitive Certificates. Neither the Depositor, the Master Servicer nor the
Trustee shall be liable for any actions taken by the Depository or its nominee, including,
without limitation, any delay in delivery of any instruction required under this section and
may conclusively rely on, and shall be protected in relying on, such instructions. Upon the
issuance of Definitive Certificates, the Trustee and the Master Servicer shall recognize the
Holders of the Definitive Certificates as Certificateholders hereunder.
(c) Each of the Certificates is intended to be a "security" governed by Article 8 of the
Uniform Commercial Code as in effect in the State of New York and any other applicable
jurisdiction, to the extent that any of such laws may be applicable.
Section 5.02. Registration of Transfer and Exchange of Certificates.
(a) The Trustee shall cause to be kept at one of the offices or agencies to be appointed
by the Trustee, in accordance with the provisions of Section 8.12, a Certificate Register in
which, subject to such reasonable regulations as it may prescribe, the Trustee shall provide
for the registration of Certificates and of transfers and exchanges of Certificates as
herein provided. The Trustee is initially appointed Certificate Registrar for the purpose of
registering Certificates and transfers and exchanges of Certificates as herein provided. The
Certificate Registrar, or the Trustee, shall provide the Master Servicer with a certified
list of Certificateholders as of each Record Date prior to the related Determination Date.
(b) Upon surrender for registration of transfer of any Certificate at any office or
agency of the Trustee maintained for such purpose pursuant to Section 8.12 and, in the case
of any Class SB or Class R Certificate, upon satisfaction of the conditions set forth below,
the Trustee shall execute and the Certificate Registrar shall authenticate and deliver, in
the name of the designated Transferee or Transferees, one or more new Certificates of a like
Class and aggregate Percentage Interest.
(c) At the option of the Certificateholders, Certificates may be exchanged for other
Certificates of authorized denominations of a like Class and aggregate Percentage Interest,
upon surrender of the Certificates to be exchanged at any such office or agency. Whenever
any Certificates are so surrendered for exchange the Trustee shall execute and the
Certificate Registrar shall authenticate and deliver the Certificates of such Class which
the Certificateholder making the exchange is entitled to receive. Every Certificate
presented or surrendered for transfer or exchange shall (if so required by the Trustee or
the Certificate Registrar) be duly endorsed by, or be accompanied by a written instrument of
transfer in form satisfactory to the Trustee and the Certificate Registrar duly executed by,
the Holder thereof or his attorney duly authorized in writing.
(d) No transfer, sale, pledge or other disposition of a Class B, Class SB or Class R
Certificate shall be made unless such transfer, sale, pledge or other disposition is exempt
from the registration requirements of the Securities Act of 1933, as amended (the "1933
Act"), and any applicable state securities laws or is made in accordance with said Act and
laws. Except as otherwise provided in this Section 5.02(d), in the event that a transfer of
a Class B, Class SB or Class R Certificate is to be made, (i) unless the Depositor directs
the Trustee otherwise, the Trustee shall require a written Opinion of Counsel addressed to
and acceptable to and in form and substance satisfactory to the Trustee and the Depositor
that such transfer may be made pursuant to an exemption, describing the applicable exemption
and the basis therefor, from said Act and laws or is being made pursuant to said Act and
laws, which Opinion of Counsel shall not be an expense of the Trustee, the Trust Fund, the
Depositor or the Master Servicer, and (ii) the Trustee shall require the Transferee to
execute a representation letter, substantially in the form of Exhibit J hereto, and the
Trustee shall require the transferor to execute a representation letter, substantially in
the form of Exhibit K hereto, each acceptable to and in form and substance satisfactory to
the Depositor and the Trustee certifying to the Depositor and the Trustee the facts
surrounding such transfer, which representation letters shall not be an expense of the
Trustee, the Trust Fund, the Depositor or the Master Servicer. In lieu of the requirements
set forth in the preceding sentence, transfers of Class B, Class SB or Class R Certificates
may be made in accordance with this Section 5.02(d) if the prospective Transferee of such a
Certificate provides the Trustee and the Master Servicer with an investment letter
substantially in the form of Exhibit O attached hereto, which investment letter shall not be
an expense of the Trustee, the Depositor, or the Master Servicer, and which investment
letter states that, among other things, such Transferee (i) is a "qualified institutional
buyer" as defined under Rule 144A, acting for its own account or the accounts of other
"qualified institutional buyers" as defined under Rule 144A, and (ii) is aware that the
proposed transferor intends to rely on the exemption from registration requirements under
the 1933 Act provided by Rule 144A. The Holder of a Class B, Class SB or Class R Certificate
desiring to effect any transfer, sale, pledge or other disposition shall, and does hereby
agree to, indemnify the Trustee, the Depositor, the Master Servicer and the Certificate
Registrar against any liability that may result if the transfer, sale, pledge or other
disposition is not so exempt or is not made in accordance with such federal and state laws
and this Agreement.
(e) (i) In the case of any Class B Certificate, Class SB Certificate or Class R
Certificate presented for registration in the name of any Person, either (A) the Trustee
shall require an Opinion of Counsel acceptable to and in form and substance satisfactory to
the Trustee, the Depositor and the Master Servicer to the effect that the purchase and
holding of such Class B, Class SB or Class R Certificate is permissible under applicable
law, will not constitute or result in any non-exempt prohibited transaction under Section
406 of ERISA or Section 4975 of the Code (or comparable provisions of any subsequent
enactments), and will not subject the Trustee, the Depositor or the Master Servicer to any
obligation or liability (including obligations or liabilities under ERISA or Section 4975 of
the Code) in addition to those undertaken in this Agreement, which Opinion of Counsel shall
not be an expense of the Trustee, the Depositor or the Master Servicer, or (B) the
prospective Transferee shall be required to provide the Trustee, the Depositor and the
Master Servicer with a certification to the effect set forth in Exhibit Q (with respect to a
Class SB Certificate), in paragraph 6 of Exhibit J (with respect to a Class B Certificate),
or in paragraph fifteen of Exhibit I-1 (with respect to a Class R Certificate), which the
Trustee may rely upon without further inquiry or investigation, or such other certifications
as the Trustee may deem desirable or necessary in order to establish that such Transferee or
the Person in whose name such registration is requested is not an employee benefit plan or
other plan subject to the prohibited transaction provisions of ERISA or Section 4975 of the
Code (each, an "ERISA Plan"), or any Person (including, without limitation, an insurance
company investing its general accounts, an investment manager, a named fiduciary or a
trustee of any ERISA Plan) who is using "plan assets," within the meaning of the U.S.
Department of Labor regulation promulgated at 29 C.F.R.ss.2510.3 101, of any Plan (each, an
"ERISA Plan Investor") to effect such acquisition. In the case of a Class B Certificate, the
following conditions are satisfied: (i) such Transferee is an insurance company, (ii) the
source of funds used to purchase or hold such Certificate (or any interest therein) is an
"insurance company general account" (as defined in U.S. Department of Labor Prohibited
Transaction Class Exemption ("PTCE") 95-60, and (iii) the conditions set forth in Sections I
and III of PTCE 95-60 have been satisfied (each entity that satisfies this clause, a
"Complying Insurance Company").
(ii) Any Transferee of a Class M Certificate or Class A Certificate not rated at least
"AA-" at the time of purchase (a "Restricted Class A Certificate," or will be deemed
to have represented by virtue of its purchase or holding of such Certificate (or any
interest therein) that either (a) such Transferee is not an ERISA Plan or an ERISA
Plan Investor, (b)(x) such Transferee is a Complying Insurance Company.
(A) If any Class M Certificate or Restricted Class A Certificate (or any interest
therein) is acquired or held by any Person that does not satisfy the
conditions described in paragraph (ii) above, then the last preceding
Transferee that either (x) is not an ERISA Plan or an ERISA Plan Investor or
(y) is a Complying Insurance Company shall be restored, to the extent
permitted by law, to all rights and obligations as Certificate Owner thereof
retroactive to the date of such Transfer of such Certificate. The Trustee
shall be under no liability to any Person for making any payments due on such
Certificate to such preceding Transferee.
(B) Any purported Certificate Owner whose acquisition or holding of any Class M
Certificate or Restricted Class A Certificate (or any interest therein) was
effected in violation of the restrictions in this Section 5.02(e) shall
indemnify and hold harmless the Depositor, the Trustee, the Master Servicer,
any Subservicer, any underwriter and the Trust Fund from and against any and
all liabilities, claims, costs or expenses incurred by such parties as a
result of such acquisition or holding.
(f) (i) Each Person who has or who acquires any Ownership Interest in a Class R
Certificate shall be deemed by the acceptance or acquisition of such Ownership Interest to
have agreed to be bound by the following provisions and to have irrevocably authorized the
Trustee or its designee under clause (iii)(A) below to deliver payments to a Person other
than such Person and to negotiate the terms of any mandatory sale under clause (iii)(B)
below and to execute all instruments of transfer and to do all other things necessary in
connection with any such sale. The rights of each Person acquiring any Ownership Interest in
a Class R Certificate are expressly subject to the following provisions:
(A) Each Person holding or acquiring any Ownership Interest in a Class R Certificate
shall be a Permitted Transferee and shall promptly notify the Trustee of any
change or impending change in its status as a Permitted Transferee.
(B) In connection with any proposed Transfer of any Ownership Interest in a Class R
Certificate, the Trustee shall require delivery to it, and shall not register
the Transfer of any Class R Certificate until its receipt of,
(1) an affidavit and agreement (a "Transfer Affidavit and Agreement," in the form
attached hereto as Exhibit I-1) from the proposed Transferee, in form
and substance satisfactory to the Master Servicer, representing and
warranting, among other things, that it is a Permitted Transferee, that
it is not acquiring its Ownership Interest in the Class R Certificate
that is the subject of the proposed Transfer as a nominee, trustee or
agent for any Person who is not a Permitted Transferee, that for so
long as it retains its Ownership Interest in a Class R Certificate, it
will endeavor to remain a Permitted Transferee, and that it has
reviewed the provisions of this Section 5.02(f) and agrees to be bound
by them, and
(2) a certificate, in the form attached hereto as Exhibit I-2, from the Holder wishing to
transfer the Class R Certificate, in form and substance satisfactory to
the Master Servicer, representing and warranting, among other things,
that no purpose of the proposed Transfer is to impede the assessment or
collection of tax.
(C) Notwithstanding the delivery of a Transfer Affidavit and Agreement by a proposed
Transferee under clause (B) above, if a Responsible Officer of the Trustee who
is assigned to this Agreement has actual knowledge that the proposed
Transferee is not a Permitted Transferee, no Transfer of an Ownership Interest
in a Class R Certificate to such proposed Transferee shall be effected.
(D) Each Person holding or acquiring any Ownership Interest in a Class R Certificate
shall agree (x) to require a Transfer Affidavit and Agreement from any other
Person to whom such Person attempts to transfer its Ownership Interest in a
Class R Certificate and (y) not to transfer its Ownership Interest unless it
provides a certificate to the Trustee in the form attached hereto as Exhibit
I-2.
(E) Each Person holding or acquiring an Ownership Interest in a Class R Certificate, by
purchasing an Ownership Interest in such Certificate, agrees to give the
Trustee written notice that it is a "pass-through interest holder" within the
meaning of Temporary Treasury Regulations Section 1.67-3T(a)(2)(i)(A)
immediately upon acquiring an Ownership Interest in a Class R Certificate, if
it is, or is holding an Ownership Interest in a Class R Certificate on behalf
of, a "pass-through interest holder."
(ii) The Trustee shall register the Transfer of any Class R Certificate only if it shall
have received the Transfer Affidavit and Agreement, a certificate of the Holder
requesting such transfer in the form attached hereto as Exhibit I-2 and all of such
other documents as shall have been reasonably required by the Trustee as a condition
to such registration. Transfers of the Class R Certificates to Non-United States
Persons and Disqualified Organizations (as defined in Section 860E(e)(5) of the Code)
are prohibited.
(A) If any Disqualified Organization shall become a holder of a Class R Certificate, then
the last preceding Permitted Transferee shall be restored, to the extent
permitted by law, to all rights and obligations as Holder thereof retroactive
to the date of registration of such Transfer of such Class R Certificate. If a
Non-United States Person shall become a holder of a Class R Certificate, then
the last preceding United States Person shall be restored, to the extent
permitted by law, to all rights and obligations as Holder thereof retroactive
to the date of registration of such Transfer of such Class R Certificate. If a
transfer of a Class R Certificate is disregarded pursuant to the provisions of
Treasury Regulations Section 1.860E-1 or Section 1.860G-3, then the last
preceding Permitted Transferee shall be restored, to the extent permitted by
law, to all rights and obligations as Holder thereof retroactive to the date
of registration of such Transfer of such Class R Certificate. The Trustee
shall be under no liability to any Person for any registration of Transfer of
a Class R Certificate that is in fact not permitted by this Section 5.02(f) or
for making any payments due on such Certificate to the holder thereof or for
taking any other action with respect to such holder under the provisions of
this Agreement.
(B) If any purported Transferee shall become a Holder of a Class R Certificate in
violation of the restrictions in this Section 5.02(f) and to the extent that
the retroactive restoration of the rights of the Holder of such Class R
Certificate as described in clause (iii)(A) above shall be invalid, illegal or
unenforceable, then the Master Servicer shall have the right, without notice
to the holder or any prior holder of such Class R Certificate, to sell such
Class R Certificate to a purchaser selected by the Master Servicer on such
terms as the Master Servicer may choose. Such purported Transferee shall
promptly endorse and deliver each Class R Certificate in accordance with the
instructions of the Master Servicer. Such purchaser may be the Master Servicer
itself or any Affiliate of the Master Servicer. The proceeds of such sale, net
of the commissions (which may include commissions payable to the Master
Servicer or its Affiliates), expenses and taxes due, if any, will be remitted
by the Master Servicer to such purported Transferee. The terms and conditions
of any sale under this clause (iii)(B) shall be determined in the sole
discretion of the Master Servicer, and the Master Servicer shall not be liable
to any Person having an Ownership Interest in a Class R Certificate as a
result of its exercise of such discretion.
(iii) The Master Servicer, on behalf of the Trustee, shall make available, upon written
request from the Trustee, all information necessary to compute any tax imposed
(A) as a result of the Transfer of an Ownership Interest in a Class R Certificate to any
Person who is a Disqualified Organization, including the information regarding
"excess inclusions" of such Class R Certificates required to be provided to
the Internal Revenue Service and certain Persons as described in Treasury
Regulations Sections 1.860D-1(b)(5) and 1.860E-2(a)(5), and
(B) as a result of any regulated investment company, real estate investment trust, common
trust fund, partnership, trust, estate or organization described in Section
1381 of the Code that holds an Ownership Interest in a Class R Certificate
having as among its record holders at any time any Person who is a
Disqualified Organization. Reasonable compensation for providing such
information may be required by the Master Servicer from such Person.
(iv) The provisions of this Section 5.02(f) set forth prior to this clause (v) may be
modified, added to or eliminated, provided that there shall have been delivered to
the Trustee the following:
(A) Written notification from each Rating Agency to the effect that the modification,
addition to or elimination of such provisions will not cause such Rating
Agency to downgrade its then-current ratings, if any, of the Class A
Certificates and Class M Certificates 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
(B) a certificate of the Master Servicer stating that the Master Servicer has received an
Opinion of Counsel, in form and substance satisfactory to the Master Servicer,
to the effect that such modification, addition to or absence of such
provisions will not cause any REMIC created hereunder to cease to qualify as a
REMIC and will not cause (x) any REMIC created hereunder to be subject to an
entity-level tax caused by the Transfer of any Class R Certificate to a Person
that is a Disqualified Organization or (y) a Certificateholder or another
Person to be subject to a REMIC-related tax caused by the Transfer of a Class
R Certificate to a Person that is not a Permitted Transferee.
(g) No service charge shall be made for any transfer or exchange of Certificates of any
Class, but the Trustee may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer or exchange of
Certificates.
(h) All Certificates surrendered for transfer and exchange shall be destroyed by the
Certificate Registrar.
Section 5.03. Mutilated, Destroyed, Lost or Stolen Certificates.
If (i) any mutilated Certificate is surrendered to the Certificate Registrar, or the
Trustee and the Certificate Registrar receive evidence to their satisfaction of the
destruction, loss or theft of any Certificate, and (ii) there is delivered to the Trustee
and the Certificate Registrar such security or indemnity as may be required by them to save
each of them harmless, then, in the absence of notice to the Trustee or the Certificate
Registrar that such Certificate has been acquired by a bona fide purchaser, the Trustee
shall execute and the Certificate Registrar shall authenticate and deliver, in exchange for
or in lieu of any such mutilated, destroyed, lost or stolen Certificate, a new Certificate
of like tenor, Class and Percentage Interest but bearing a number not contemporaneously
outstanding. Upon the issuance of any new Certificate under this Section, the Trustee may
require the payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in relation thereto and any other expenses (including the fees and expenses
of the Trustee and the Certificate Registrar) connected therewith. Any duplicate Certificate
issued pursuant to this Section shall constitute complete and indefeasible evidence of
ownership in the Trust Fund, as if originally issued, whether or not the lost, stolen or
destroyed Certificate shall be found at any time.
Section 5.04. Persons Deemed Owners.
Prior to due presentation of a Certificate for registration of transfer, the
Depositor, the Master Servicer, the Trustee, the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Trustee or the Certificate Registrar may treat the
Person in whose name any Certificate is registered as the owner of such Certificate for the
purpose of receiving distributions pursuant to Section 4.02 and for all other purposes
whatsoever, except as and to the extent provided in the definition of "Certificateholder"
and neither the Depositor, the Master Servicer, the Trustee, the Certificate Registrar nor
any agent of the Depositor, the Master Servicer, the Trustee or the Certificate Registrar
shall be affected by notice to the contrary except as provided in Section 5.02(f).
Section 5.05. Appointment of Paying Agent.
The Trustee may appoint a Paying Agent for the purpose of making distributions to
Certificateholders pursuant to Section 4.02. In the event of any such appointment, on or
prior to each Distribution Date the Master Servicer on behalf of the Trustee shall deposit
or cause to be deposited with the Paying Agent a sum sufficient to make the payments to
Certificateholders in the amounts and in the manner provided for in Section 4.02, such sum
to be held in trust for the benefit of Certificateholders. The Trustee shall cause each
Paying Agent to execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee that such Paying Agent will hold all sums held by it for the
payment to Certificateholders in trust for the benefit of the Certificateholders entitled
thereto until such sums shall be paid to such Certificateholders. Any sums so held by such
Paying Agent shall be held only in Eligible Accounts to the extent such sums are not
distributed to the Certificateholders on the date of receipt by such Paying Agent.
ARTICLE VI
THE DEPOSITOR AND THE MASTER SERVICER
Section 6.01. Respective Liabilities of the Depositor and the Master Servicer.
The Depositor and the Master Servicer shall each be liable in accordance herewith
only to the extent of the obligations specifically and respectively imposed upon and
undertaken by the Depositor and the Master Servicer herein. By way of illustration and not
limitation, the Depositor is not liable for the servicing and administration of the Mortgage
Loans, nor is it obligated by Section 7.01 or 10.01 to assume any obligations of the Master
Servicer or to appoint a designee to assume such obligations, nor is it liable for any other
obligation hereunder that it may, but is not obligated to, assume unless it elects to assume
such obligation in accordance herewith.
Section 6.02. Merger or Consolidation of the Depositor or the Master Servicer; Assignment of
Rights and Delegation of Duties by Master Servicer.
(a) The Depositor and the Master Servicer shall each keep in full effect its existence,
rights and franchises as a corporation under the laws of the state of its incorporation, and
will each obtain and preserve its qualification to do business as a foreign corporation in
each jurisdiction in which such qualification is or shall be necessary to protect the
validity and enforceability of this Agreement, the Certificates or any of the Mortgage Loans
and to perform its respective duties under this Agreement.
(b) Any Person into which the Depositor or the Master Servicer may be merged or
consolidated, or any corporation resulting from any merger or consolidation to which the
Depositor or the Master Servicer shall be a party, or any Person succeeding to the business
of the Depositor or the Master Servicer, shall be the successor of the Depositor or the
Master Servicer, as the case may be, hereunder, without the execution or filing of any paper
or any further act on the part of any of the parties hereto, anything herein to the contrary
notwithstanding; provided, however, that the successor or surviving Person to the Master
Servicer shall be qualified to service mortgage loans on behalf of ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇
Mac; and provided further that each Rating Agency's ratings, if any, of the Class A
Certificates and Class M Certificates in effect immediately prior to such merger or
consolidation will not be qualified, reduced or withdrawn as a result thereof (as evidenced
by a letter to such effect from each Rating Agency).
(c) Notwithstanding anything else in this Section 6.02 and Section 6.04 to the contrary,
the Master Servicer may assign its rights and delegate its duties and obligations under this
Agreement; provided that the Person accepting such assignment or delegation shall be a
Person which is qualified to service mortgage loans on behalf of ▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac,
is reasonably satisfactory to the Trustee and the Depositor, is willing to service the
Mortgage Loans and executes and delivers to the Depositor and the Trustee an agreement, in
form and substance reasonably satisfactory to the Depositor and the Trustee, which contains
an assumption by such Person of the due and punctual performance and observance of each
covenant and condition to be performed or observed by the Master Servicer under this
Agreement; provided further that each Rating Agency's rating of the Classes of Certificates
that have been rated in effect immediately prior to such assignment and delegation will not
be qualified, reduced or withdrawn as a result of such assignment and delegation (as
evidenced by a letter to such effect from each Rating Agency). In the case of any such
assignment and delegation, the Master Servicer shall be released from its obligations under
this Agreement, except that the Master Servicer shall remain liable for all liabilities and
obligations incurred by it as Master Servicer hereunder prior to the satisfaction of the
conditions to such assignment and delegation set forth in the next preceding sentence. This
Section 6.02 shall not apply to any sale, transfer, pledge or assignment by Residential
Funding of the Call Rights.
Section 6.03. Limitation on Liability of the Depositor, the Master Servicer and Others.
None of the Depositor, the Master Servicer or any of the directors, officers,
employees or agents of the Depositor or the Master Servicer shall be under any liability to
the Trust Fund or the Certificateholders for any action taken or for refraining from the
taking of any action in good faith pursuant to this Agreement, or for errors in judgment;
provided, however, that this provision shall not protect the Depositor, the Master Servicer
or any such Person against any breach of warranties or representations made herein or any
liability which would otherwise be imposed by reason of willful misfeasance, bad faith or
gross negligence in the performance of duties or by reason of reckless disregard of
obligations and duties hereunder. The Depositor, the Master Servicer and any director,
officer, employee or agent of the Depositor or the Master Servicer may rely in good faith on
any document of any kind prima facie properly executed and submitted by any Person
respecting any matters arising hereunder. The Depositor, the Master Servicer and any
director, officer, employee or agent of the Depositor or the Master Servicer shall be
indemnified by the Trust Fund and held harmless against any loss, liability or expense
incurred in connection with any legal action relating to this Agreement or the Certificates,
other than any loss, liability or expense related to any specific Mortgage Loan or Mortgage
Loans (except as any such loss, liability or expense shall be otherwise reimbursable
pursuant to this Agreement) and any loss, liability or expense incurred by reason of willful
misfeasance, bad faith or gross negligence in the performance of duties hereunder or by
reason of reckless disregard of obligations and duties hereunder. Neither the Depositor nor
the Master Servicer shall be under any obligation to appear in, prosecute or defend any
legal or administrative action, proceeding, hearing or examination that is not incidental to
its respective duties under this Agreement and which in its opinion may involve it in any
expense or liability; provided, however, that the Depositor or the Master Servicer may in
its discretion undertake any such action, proceeding, hearing or examination that it may
deem necessary or desirable in respect to this Agreement and the rights and duties of the
parties hereto and the interests of the Certificateholders hereunder. In such event, the
legal expenses and costs of such action, proceeding, hearing or examination and any
liability resulting therefrom shall be expenses, costs and liabilities of the Trust Fund,
and the Depositor and the Master Servicer shall be entitled to be reimbursed therefor out of
amounts attributable to the Mortgage Loans on deposit in the Custodial Account as provided
by Section 3.10 and, on the Distribution Date(s) following such reimbursement, the aggregate
of such expenses and costs shall be allocated in reduction of the Accrued Certificate
Interest on each Class entitled thereto in the same manner as if such expenses and costs
constituted a Prepayment Interest Shortfall.
Section 6.04. Depositor and Master Servicer Not to Resign.
Subject to the provisions of Section 6.02, neither the Depositor nor the Master
Servicer shall resign from its respective obligations and duties hereby imposed on it except
upon determination that its duties hereunder are no longer permissible under applicable law.
Any such determination permitting the resignation of the Depositor or the Master Servicer
shall be evidenced by an Opinion of Counsel (at the expense of the resigning party) to such
effect delivered to the Trustee. No such resignation by the Master Servicer shall become
effective until the Trustee or a successor servicer shall have assumed the Master Servicer's
responsibilities and obligations in accordance with Section 7.02.
ARTICLE VII
DEFAULT
Section 7.01. Events of Default.
Event of Default, wherever used herein, means any one of the following events
(whatever reason for such Event of Default and whether it shall be voluntary or involuntary
or be effected by operation of law or pursuant to any judgment, decree or order of any court
or any order, rule or regulation of any administrative or governmental body):
(i) the Master Servicer shall fail to distribute or cause to be distributed to Holders of
Certificates of any Class any distribution required to be made under the terms of the
Certificates of such Class and this Agreement and, in either case, such failure shall
continue unremedied for a period of 5 days after the date upon which written notice
of such failure, requiring such failure to be remedied, shall have been given to the
Master Servicer by the Trustee or the Depositor or to the Master Servicer, the
Depositor and the Trustee by the Holders of Certificates of such Class evidencing
Percentage Interests aggregating not less than 25%; or
(ii) the Master Servicer shall fail to observe or perform in any material respect any
other of the covenants or agreements on the part of the Master Servicer contained in
the Certificates of any Class or in this Agreement and such failure shall continue
unremedied for a period of 30 days (except that such number of days shall be 15 in
the case of a failure to pay the premium for any Required Insurance Policy) after the
date on which written notice of such failure, requiring the same to be remedied,
shall have been given to the Master Servicer by the Trustee or the Depositor, or to
the Master Servicer, the Depositor and the Trustee by the Holders of Certificates of
any Class evidencing, as to such Class, Percentage Interests aggregating not less
than 25%; or
(iii) a decree or order of a court or agency or supervisory authority having jurisdiction
in the premises in an involuntary case under any present or future federal or state
bankruptcy, insolvency or similar law or appointing a conservator or receiver or
liquidator in any insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings, or for the winding-up or liquidation of its
affairs, shall have been entered against the Master Servicer and such decree or order
shall have remained in force undischarged or unstayed for a period of 60 days; or
(iv) the Master Servicer shall consent to the appointment of a conservator or receiver or
liquidator in any insolvency, readjustment of debt, marshalling of assets and
liabilities, or similar proceedings of, or relating to, the Master Servicer or of, or
relating to, all or substantially all of the property of the Master Servicer; or
(v) the Master Servicer shall admit in writing its inability to pay its debts generally
as they become due, file a petition to take advantage of, or commence a voluntary
case under, any applicable insolvency or reorganization statute, make an assignment
for the benefit of its creditors, or voluntarily suspend payment of its obligations;
or
(vi) the Master Servicer shall notify the Trustee pursuant to Section 4.04(b) that it is
unable to deposit in the Certificate Account an amount equal to the Advance.
If an Event of Default described in clauses (i)-(v) of this Section shall occur,
then, and in each and every such case, so long as such Event of Default shall not have been
remedied, either the Depositor or the Trustee shall at the direction of Holders of
Certificates entitled to at least 51% of the Voting Rights, by notice in writing to the
Master Servicer (and to the Depositor if given by the Trustee or to the Trustee if given by
the Depositor), terminate all of the rights and obligations of the Master Servicer under
this Agreement and in and to the Mortgage Loans and the proceeds thereof, other than its
rights as a Certificateholder hereunder; provided, however, that a successor to the Master
Servicer is appointed pursuant to Section 7.02 and such successor Master Servicer shall have
accepted the duties of Master Servicer effective upon the resignation of the Master
Servicer. If an Event of Default described in clause (vi) hereof shall occur, the Trustee
shall, by notice to the Master Servicer and the Depositor, immediately terminate all of the
rights and obligations of the Master Servicer under this Agreement and in and to the
Mortgage Loans and the proceeds thereof, other than its rights as a Certificateholder
hereunder as provided in Section 4.04(b). On or after the receipt by the Master Servicer of
such written notice, all authority and power of the Master Servicer under this Agreement,
whether with respect to the Certificates (other than as a Holder thereof) or the Mortgage
Loans or otherwise, shall subject to Section 7.02 pass to and be vested in the Trustee or
the Trustee's designee appointed pursuant to Section 7.02; and, without limitation, the
Trustee is hereby authorized and empowered to execute and deliver, on behalf of the Master
Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and
to do or accomplish all other acts or things necessary or appropriate to effect the purposes
of such notice of termination, whether to complete the transfer and endorsement or
assignment of the Mortgage Loans and related documents, or otherwise. The Master Servicer
agrees to cooperate with the Trustee in effecting the termination of the Master Servicer's
responsibilities and rights hereunder, including, without limitation, the transfer to the
Trustee or its designee for administration by it of all cash amounts which shall at the time
be credited to the Custodial Account or the Certificate Account or thereafter be received
with respect to the Mortgage Loans. No such termination shall release the Master Servicer
for any liability that it would otherwise have hereunder for any act or omission prior to
the effective time of such termination. Notwithstanding any termination of the activities of
Residential Funding in its capacity as Master Servicer hereunder, Residential Funding shall
be entitled to receive, out of any late collection of a Monthly Payment on a Mortgage Loan
which was due prior to the notice terminating Residential Funding's rights and obligations
as Master Servicer hereunder and received after such notice, that portion to which
Residential Funding would have been entitled pursuant to Sections 3.10(a)(ii), (vi) and
(vii) as well as its Servicing Fee in respect thereof, and any other amounts payable to
Residential Funding hereunder the entitlement to which arose prior to the termination of its
activities hereunder. Upon the termination of Residential Funding as Master Servicer
hereunder the Depositor shall deliver to the Trustee as successor Master Servicer a copy of
the Program Guide.
Section 7.02. Trustee or Depositor to Act; Appointment of Successor.
(a) On and after the time the Master Servicer receives a notice of termination pursuant
to Section 7.01 or resigns in accordance with Section 6.04, the Trustee or, upon notice to
the Depositor and with the Depositor's consent (which shall not be unreasonably withheld) a
designee (which meets the standards set forth below) of the Trustee, shall be the successor
in all respects to the Master Servicer in its capacity as servicer under this Agreement and
the transactions set forth or provided for herein and shall be subject to all the
responsibilities, duties and liabilities relating thereto placed on the Master Servicer
(except for the responsibilities, duties and liabilities contained in Sections 2.02 and
2.03(a), excluding the duty to notify related Subservicers as set forth in such Sections,
and its obligations to deposit amounts in respect of losses incurred prior to such notice or
termination on the investment of funds in the Custodial Account or the Certificate Account
pursuant to Sections 3.07(c) and 4.01(d) by the terms and provisions hereof); provided,
however, that any failure to perform such duties or responsibilities caused by the preceding
Master Servicer's failure to provide information required by Section 4.04 shall not be
considered a default by the Trustee hereunder as successor Master Servicer. As compensation
therefor, the Trustee as successor Master Servicer shall be entitled to all funds relating
to the Mortgage Loans which the Master Servicer would have been entitled to charge to the
Custodial Account or the Certificate Account if the Master Servicer had continued to act
hereunder and, in addition, shall be entitled to the income from any Permitted Investments
made with amounts attributable to the Mortgage Loans held in the Custodial Account or the
Certificate Account. If the Trustee has become the successor to the Master Servicer in
accordance with Section 6.04 or Section 7.01, then notwithstanding the above, the Trustee
may, if it shall be unwilling to so act, or shall, if it is unable to so act, appoint, or
petition a court of competent jurisdiction to appoint, any established housing and home
finance institution, which is also a ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac-approved mortgage servicing
institution, having a net worth of not less than $10,000,000 as the successor to the Master
Servicer hereunder in the assumption of all or any part of the responsibilities, duties or
liabilities of the Master Servicer hereunder. Pending appointment of a successor to the
Master Servicer hereunder, the Trustee shall become successor to the Master Servicer and
shall act in such capacity as hereinabove provided. In connection with such appointment and
assumption, the Trustee may make such arrangements for the compensation of such successor
out of payments on Mortgage Loans as it and such successor shall agree; provided, however,
that no such compensation shall be in excess of that permitted the initial Master Servicer
hereunder. The Depositor, the Trustee, the Custodian and such successor shall take such
action, consistent with this Agreement, as shall be necessary to effectuate any such
succession. The Servicing Fee for any successor Master Servicer appointed pursuant to this
Section 7.02 will be lowered with respect to those Mortgage Loans, if any, where the
Subservicing Fee accrues at a rate of less than 0.50% per annum in the event that the
successor Master Servicer is not servicing such Mortgage Loans directly and it is necessary
to raise the related Subservicing Fee to a rate of 0.50% per annum in order to hire a
Subservicer with respect to such Mortgage Loans.
(b) In connection with the termination or resignation of the Master Servicer hereunder,
either (i) the successor Master Servicer, including the Trustee if the Trustee is acting as
successor Master Servicer, shall represent and warrant that it is a member of MERS in good
standing and shall agree to comply in all material respects with the rules and procedures of
MERS in connection with the servicing of the Mortgage Loans that are registered with MERS,
in which case the predecessor Master Servicer shall cooperate with the successor Master
Servicer in causing MERS to revise its records to reflect the transfer of servicing to the
successor Master Servicer as necessary under MERS' rules and regulations, or (ii) the
predecessor Master Servicer shall cooperate with the successor Master Servicer in causing
MERS to execute and deliver an assignment of Mortgage in recordable form to transfer the
Mortgage from MERS to the Trustee and to execute and deliver such other notices, documents
and other instruments as may be necessary or desirable to effect a transfer of such Mortgage
Loan or servicing of such Mortgage Loan on the MERS(R)System to the successor Master
Servicer. The predecessor Master Servicer shall file or cause to be filed any such
assignment in the appropriate recording office. The predecessor Master Servicer shall bear
any and all fees of MERS, costs of preparing any assignments of Mortgage, and fees and costs
of filing any assignments of Mortgage that may be required under this subsection (b). The
Successor Master Servicer shall cause such assignment to be delivered to the Trustee or the
Custodian promptly upon receipt of the original with evidence of recording thereon or a copy
certified by the public recording office in which such assignment was recorded.
Section 7.03. Notification to Certificateholders.
(a) Upon any such termination or appointment of a successor to the Master Servicer, the
Trustee shall give prompt written notice thereof to the Certificateholders at their
respective addresses appearing in the Certificate Register.
(b) Within 60 days after the occurrence of any Event of Default, the Trustee shall
transmit by mail to all Holders of Certificates notice of each such Event of Default
hereunder known to the Trustee, unless such Event of Default shall have been cured or waived
as provided in Section 7.04 hereof.
Section 7.04. Waiver of Events of Default.
The Holders representing at least 66% of the Voting Rights of Certificates affected
by a default or Event of Default hereunder may waive any default or Event of Default;
provided, however, that (a) a default or Event of Default under clause (i) of Section 7.01
may be waived only by all of the Holders of Certificates affected by such default or Event
of Default and (b) no waiver pursuant to this Section 7.04 shall affect the Holders of
Certificates in the manner set forth in Section 11.01(b)(i), (ii) or (iii). Upon any such
waiver of a default or Event of Default by the Holders representing the requisite percentage
of Voting Rights of Certificates affected by such default or Event of Default, such default
or Event of Default shall cease to exist and shall be deemed to have been remedied for every
purpose hereunder. No such waiver shall extend to any subsequent or other default or Event
of Default or impair any right consequent thereon except to the extent expressly so waived.
ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.01. Duties of Trustee.
(a) The Trustee, prior to the occurrence of an Event of Default and after the curing of
all Events of Default which may have occurred, undertakes to perform such duties and only
such duties as are specifically set forth in this Agreement. In case an Event of Default has
occurred (which has not been cured or waived), the Trustee shall exercise such of the rights
and powers vested in it by this Agreement, and use the same degree of care and skill in
their exercise as a prudent investor would exercise or use under the circumstances in the
conduct of such investor's own affairs.
(b) The Trustee, upon receipt of all resolutions, certificates, statements, opinions,
reports, documents, orders or other instruments furnished to the Trustee which are
specifically required to be furnished pursuant to any provision of this Agreement, shall
examine them to determine whether they conform to the requirements of this Agreement. The
Trustee shall notify the Certificateholders of any such documents which do not materially
conform to the requirements of this Agreement in the event that the Trustee, after so
requesting, does not receive satisfactorily corrected documents in a timely fashion. The
Trustee shall forward or cause to be forwarded or make available electronically on its
website in a timely fashion the notices, reports and statements required to be forwarded by
the Trustee pursuant to Sections 4.03, 7.03, and 10.01. The Trustee shall furnish in a
timely fashion to the Master Servicer such information as the Master Servicer may reasonably
request from time to time for the Master Servicer to fulfill its duties as set forth in this
Agreement. The Trustee covenants and agrees that it shall perform its obligations hereunder
in a manner so as to maintain the status of each REMIC created hereunder as a REMIC under
the REMIC Provisions and to prevent the imposition of any federal, state or local income,
prohibited transaction (except as provided in Section 2.04 herein), contribution or other
tax on the Trust Fund to the extent that maintaining such status and avoiding such taxes are
reasonably within the control of the Trustee and are reasonably within the scope of its
duties under this Agreement.
(c) No provision of this Agreement shall be construed to relieve the Trustee from
liability for its own negligent action, its own negligent failure to act or its own willful
misconduct; provided, however, that:
(i) Prior to the occurrence of an Event of Default, and after the curing or waiver of all
such Events of Default which may have occurred, the duties and obligations of the
Trustee shall be determined solely by the express provisions of this Agreement, the
Trustee shall not be liable except for the performance of such duties and obligations
as are specifically set forth in this Agreement, no implied covenants or obligations
shall be read into this Agreement against the Trustee and, in the absence of bad
faith on the part of the Trustee, the Trustee may conclusively rely, as to the truth
of the statements and the correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Trustee by the Depositor or the Master
Servicer and which on their face, do not contradict the requirements of this
Agreement;
(ii) The Trustee shall not be personally liable for an error of judgment made in good
faith by a Responsible Officer or Responsible Officers of the Trustee, unless it
shall be proved that the Trustee was negligent in ascertaining the pertinent facts;
(iii) The Trustee shall not be personally liable with respect to any action taken, suffered
or omitted to be taken by it in good faith in accordance with the direction of the
Certificateholders holding Certificates which evidence, Percentage Interests
aggregating not less than 25% of the affected Classes as to the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this Agreement;
(iv) The Trustee shall not be charged with knowledge of any default (other than a default
in payment to the Trustee) specified in clauses (i) and (ii) of Section 7.01 or an
Event of Default under clauses (iii), (iv) and (v) of Section 7.01 unless a
Responsible Officer of the Trustee assigned to and working in the Corporate Trust
Office obtains actual knowledge of such failure or event or the Trustee receives
written notice of such failure or event at its Corporate Trust Office from the Master
Servicer, the Depositor or any Certificateholder; and
(v) Except to the extent provided in Section 7.02, no provision in this Agreement shall
require the Trustee to expend or risk its own funds (including, without limitation,
the making of any Advance) or otherwise incur any personal financial liability in the
performance of any of its duties as Trustee hereunder, or in the exercise of any of
its rights or powers, if the Trustee shall have reasonable grounds for believing that
repayment of funds or adequate indemnity against such risk or liability is not
reasonably assured to it.
(d) The Trustee shall timely pay, from its own funds, the amount of any and all federal,
state and local taxes imposed on the Trust Fund or its assets or transactions including,
without limitation, (A) "prohibited transaction" penalty taxes as defined in Section 860F of
the Code, if, when and as the same shall be due and payable, (B) any tax on contributions to
a REMIC after the Closing Date imposed by Section 860G(d) of the Code and (C) any tax on
"net income from foreclosure property" as defined in Section 860G(c) of the Code, but only if
such taxes arise out of a breach by the Trustee of its obligations hereunder, which breach
constitutes negligence or willful misconduct of the Trustee.
Section 8.02. Certain Matters Affecting the Trustee.
(a) Except as otherwise provided in Section 8.01:
(i) The Trustee may rely and shall be protected in acting or refraining from acting upon
any resolution, Officers' Certificate, certificate of auditors or any other
certificate, statement, instrument, opinion, report, notice, request, consent, order,
appraisal, bond or other paper or document believed by it to be genuine and to have
been signed or presented by the proper party or parties;
(ii) The Trustee may consult with counsel and any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken or suffered or
omitted by it hereunder in good faith and in accordance with such Opinion of Counsel;
(iii) The Trustee shall be under no obligation to exercise any of the trusts or powers
vested in it by this Agreement or to institute, conduct or defend any litigation
hereunder or in relation hereto at the request, order or direction of any of the
Certificateholders, pursuant to the provisions of this Agreement or the Yield
Maintenance Agreement, unless such Certificateholders shall have offered to the
Trustee reasonable security or indemnity against the costs, expenses and liabilities
which may be incurred therein or thereby; nothing contained herein shall, however,
relieve the Trustee of the obligation, upon the occurrence of an Event of Default
(which has not been cured), to exercise such of the rights and powers vested in it by
this Agreement, and to use the same degree of care and skill in their exercise as a
prudent investor would exercise or use under the circumstances in the conduct of such
investor's own affairs;
(iv) The Trustee shall not be personally liable for any action taken, suffered or omitted
by it in good faith and believed by it to be authorized or within the discretion or
rights or powers conferred upon it by this Agreement;
(v) Prior to the occurrence of an Event of Default hereunder and after the curing of all
Events of Default which may have occurred, the Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order, approval,
bond or other paper or document, unless requested in writing to do so by the Holders
of Certificates of any Class evidencing, as to such Class, Percentage Interests,
aggregating not less than 50%; provided, however, that if the payment within a
reasonable time to the Trustee of the costs, expenses or liabilities likely to be
incurred by it in the making of such investigation is, in the opinion of the Trustee,
not reasonably assured to the Trustee by the security afforded to it by the terms of
this Agreement, the Trustee may require reasonable indemnity against such expense or
liability as a condition to so proceeding. The reasonable expense of every such
examination shall be paid by the Master Servicer, if an Event of Default shall have
occurred and is continuing, and otherwise by the Certificateholder requesting the
investigation;
(vi) The Trustee may execute any of the trusts or powers hereunder or perform any duties
hereunder either directly or by or through agents or attorneys provided that the
Trustee shall remain liable for any acts of such agents or attorneys;
(vii) To the extent authorized under the Code and the regulations promulgated thereunder,
each Holder of a Class R Certificate hereby irrevocably appoints and authorizes the
Trustee to be its attorney-in-fact for purposes of signing any Tax Returns required
to be filed on behalf of the Trust Fund. The Trustee shall sign on behalf of the
Trust Fund and deliver to the Master Servicer in a timely manner any Tax Returns
prepared by or on behalf of the Master Servicer that the Trustee is required to sign
as determined by the Master Servicer pursuant to applicable federal, state or local
tax laws, provided that the Master Servicer shall indemnify the Trustee for signing
any such Tax Returns that contain errors or omissions; and
(viii) Subject to compliance with all applicable federal, state and local laws, in order to
comply with its duties under the U.S. Patriot Act, the Trustee shall obtain and
verify certain information and documentation from the other parties hereto,
including, but not limited to, such party's name, address and other identifying
information.
(b) Following the issuance of the Certificates (and except as provided for in Section
2.04), the Trustee shall not accept any contribution of assets to the Trust Fund unless
subject to Section 10.01(f)) it shall have obtained or been furnished with an Opinion of
Counsel to the effect that such contribution will not (i) cause any REMIC created hereunder
to fail to qualify as a REMIC at any time that any Certificates are outstanding or (ii)
cause the Trust Fund to be subject to any federal tax as a result of such contribution
(including the imposition of any federal tax on "prohibited transactions" imposed under
Section 860F(a) of the Code).
Section 8.03. Trustee Not Liable for Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates (other than the execution of
the Certificates and relating to the acceptance and receipt of the Mortgage Loans) shall be
taken as the statements of the Depositor or the Master Servicer as the case may be, and the
Trustee assumes no responsibility for their correctness. The Trustee makes no
representations as to the validity or sufficiency of this Agreement or of the Certificates
(except that the Certificates shall be duly and validly executed and authenticated by it as
Certificate Registrar) or of any Mortgage Loan or related document, or of MERS or the MERS(R)
System. Except as otherwise provided herein, the Trustee shall not be accountable for the
use or application by the Depositor or the Master Servicer of any of the Certificates or of
the proceeds of such Certificates, or for the use or application of any funds paid to the
Depositor or the Master Servicer in respect of the Mortgage Loans or deposited in or
withdrawn from the Custodial Account or the Certificate Account by the Depositor or the
Master Servicer.
Section 8.04. Trustee May Own Certificates.
The Trustee in its individual or any other capacity may become the owner or pledgee
of Certificates with the same rights it would have if it were not Trustee.
Section 8.05. Master Servicer to Pay Trustee's Fees and Expenses; Indemnification.
(a) The Master Servicer covenants and agrees to pay to the Trustee and any co-trustee
from time to time, and the Trustee and any co-trustee shall be entitled to, reasonable
compensation (which shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust) for all services rendered by each of them in
the execution of the trusts hereby created and in the exercise and performance of any of the
powers and duties hereunder of the Trustee and any co-trustee, and the Master Servicer shall
pay or reimburse the Trustee and any co-trustee upon request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee or any co-trustee in accordance
with any of the provisions of this Agreement (including the reasonable compensation and the
expenses and disbursements of its counsel and of all persons not regularly in its employ,
and the expenses incurred by the Trustee or any co-trustee in connection with the
appointment of an office or agency pursuant to Section 8.12) except any such expense,
disbursement or advance as may arise from its negligence or bad faith.
(b) The Master Servicer agrees to indemnify the Trustee for, and to hold the Trustee
harmless against, any loss, liability or expense incurred without negligence or willful
misconduct on its part, arising out of, or in connection with, the acceptance and
administration of the Trust Fund, including the costs and expenses (including reasonable
legal fees and expenses) of defending itself against any claim in connection with the
exercise or performance of any of its powers or duties under this Agreement or the Yield
Maintenance Agreement, and the Master Servicer further agrees to indemnify the Trustee for,
and to hold the Trustee harmless against, any loss, liability or expense arising out of, or
in connection with, the provisions set forth in the second paragraph of Section 2.01(a)
hereof, including, without limitation, all costs, liabilities and expenses (including
reasonable legal fees and expenses) of investigating and defending itself against any claim,
action or proceeding, pending or threatened, relating to the provisions of such paragraph,
provided that:
(i) with respect to any such claim, the Trustee shall have given the Master Servicer
written notice thereof promptly after the Trustee shall have actual knowledge thereof;
(ii) while maintaining control over its own defense, the Trustee shall cooperate and
consult fully with the Master Servicer in preparing such defense; and
(iii) notwithstanding anything in this Agreement to the contrary, the Master Servicer shall
not be liable for settlement of any claim by the Trustee entered into without the
prior consent of the Master Servicer which consent shall not be unreasonably
withheld. No termination of this Agreement shall affect the obligations created by
this Section 8.05(b) of the Master Servicer to indemnify the Trustee under the
conditions and to the extent set forth herein. Notwithstanding the foregoing, the
indemnification provided by the Master Servicer in this Section 8.05(b) shall not
pertain to any loss, liability or expense of the Trustee, including the costs and
expenses of defending itself against any claim, incurred in connection with any
actions taken by the Trustee at the direction of Certificateholders pursuant to the
terms of this Agreement.
Section 8.06. Eligibility Requirements for Trustee.
The Trustee hereunder shall at all times be a national banking association or a New
York banking corporation having its principal office in a state and city acceptable to the
Depositor and organized and doing business under the laws of such state or the United States
of America, authorized under such laws to exercise corporate trust powers, having a combined
capital and surplus of at least $50,000,000 and subject to supervision or examination by
federal or state authority. If such corporation or national banking association publishes
reports of condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purposes of this Section the
combined capital and surplus of such corporation shall be deemed to be its combined capital
and surplus as set forth in its most recent report of condition so published. In case at any
time the Trustee shall cease to be eligible in accordance with the provisions of this
Section, the Trustee shall resign immediately in the manner and with the effect specified in
Section 8.07.
Section 8.07. Resignation and Removal of the Trustee.
(a) The Trustee may at any time resign and be discharged from the trusts hereby created
by giving written notice thereof to the Depositor and the Master Servicer. Upon receiving
such notice of resignation, the Depositor shall promptly appoint a successor trustee by
written instrument, in duplicate, one copy of which instrument shall be delivered to the
resigning Trustee and one copy to the successor trustee. If no successor trustee shall have
been so appointed and have accepted appointment within 30 days after the giving of such
notice of resignation then the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee.
(b) If at any time the Trustee shall cease to be eligible in accordance with the
provisions of Section 8.06 and shall fail to resign after written request therefor by the
Depositor, or if at any time the Trustee shall become incapable of acting, or shall be
adjudged bankrupt or insolvent, or a receiver of the Trustee or of its property shall be
appointed, or any public officer shall take charge or control of the Trustee or of its
property or affairs for the purpose of rehabilitation, conservation or liquidation, then the
Depositor may remove the Trustee and appoint a successor trustee by written instrument, in
duplicate, one copy of which instrument shall be delivered to the Trustee so removed and one
copy to the successor trustee. In addition, in the event that the Depositor determines that
the Trustee has failed (i) to distribute or cause to be distributed to Certificateholders
any amount required to be distributed hereunder, if such amount is held by the Trustee or
its Paying Agent (other than the Master Servicer or the Depositor) for distribution or (ii)
to otherwise observe or perform in any material respect any of its covenants, agreements or
obligations hereunder, and such failure shall continue unremedied for a period of 5 days (in
respect of clause (i) above) or 30 days (in respect of clause (ii) above) after the date on
which written notice of such failure, requiring that the same be remedied, shall have been
given to the Trustee by the Depositor, then the Depositor may remove the Trustee and appoint
a successor trustee by written instrument delivered as provided in the preceding sentence.
In connection with the appointment of a successor trustee pursuant to the preceding
sentence, the Depositor shall, on or before the date on which any such appointment becomes
effective, obtain from each Rating Agency written confirmation that the appointment of any
such successor trustee will not result in the reduction of the ratings on any Class of the
Certificates below the lesser of the then current or original ratings on such Certificates.
(c) The Holders of Certificates entitled to at least 51% of the Voting Rights may at any
time remove the Trustee and appoint a successor trustee by written instrument or
instruments, in triplicate, signed by such Holders or their attorneys-in-fact duly
authorized, one complete set of which instruments shall be delivered to the Depositor, one
complete set to the Trustee so removed and one complete set to the successor so appointed.
(d) Any resignation or removal of the Trustee and appointment of a successor trustee
pursuant to any of the provisions of this Section shall become effective upon acceptance of
appointment by the successor trustee as provided in Section 8.08.
Section 8.08. Successor Trustee.
(a) Any successor trustee appointed as provided in this Section 8.08 shall execute,
acknowledge and deliver to the Depositor and to its predecessor trustee an instrument
accepting such appointment hereunder, and thereupon the resignation or removal of the
predecessor trustee shall become effective and such successor trustee shall become effective
and such successor trustee, without any further act, deed or conveyance, shall become fully
vested with all the rights, powers, duties and obligations of its predecessor hereunder,
with the like effect as if originally named as trustee herein. The predecessor trustee shall
deliver to the successor trustee all Mortgage Files and related documents and statements
held by it hereunder (other than any Mortgage Files at the time held by a Custodian, which
shall become the agent of any successor trustee hereunder), and the Depositor, the Master
Servicer and the predecessor trustee shall execute and deliver such instruments and do such
other things as may reasonably be required for more fully and certainly vesting and
confirming in the successor trustee all such rights, powers, duties and obligations.
(b) No successor trustee shall accept appointment as provided in this Section unless at
the time of such acceptance such successor trustee shall be eligible under the provisions of
Section 8.06.
(c) Upon acceptance of appointment by a successor trustee as provided in this Section,
the Depositor shall mail notice of the succession of such trustee hereunder to all Holders
of Certificates at their addresses as shown in the Certificate Register. If the Depositor
fails to mail such notice within 10 days after acceptance of appointment by the successor
trustee, the successor trustee shall cause such notice to be mailed at the expense of the
Depositor.
Section 8.09. Merger or Consolidation of Trustee.
Any corporation or national banking association into which the Trustee may be merged
or converted or with which it may be consolidated or any corporation or national banking
association resulting from any merger, conversion or consolidation to which the Trustee
shall be a party, or any corporation or national banking association succeeding to the
business of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation or national banking association shall be eligible under the provisions of
Section 8.06, without the execution or filing of any paper or any further act on the part of
any of the parties hereto, anything herein to the contrary notwithstanding. The Trustee
shall mail notice of any such merger or consolidation to the Certificateholders at their
address as shown in the Certificate Register.
Section 8.10. Appointment of Co-Trustee or Separate Trustee.
(a) Notwithstanding any other provisions hereof, at any time, for the purpose of meeting
any legal requirements of any jurisdiction in which any part of the Trust Fund or property
securing the same may at the time be located, the Master Servicer and the Trustee acting
jointly shall have the power and shall execute and deliver all instruments to appoint one or
more Persons approved by the Trustee to act as co-trustee or co-trustees, jointly with the
Trustee, or separate trustee or separate trustees, of all or any part of the Trust Fund, and
to vest in such Person or Persons, in such capacity, such title to the Trust Fund, or any
part thereof, and, subject to the other provisions of this Section 8.10, such powers,
duties, obligations, rights and trusts as the Master Servicer and the Trustee may consider
necessary or desirable. If the Master Servicer shall not have joined in such appointment
within 15 days after the receipt by it of a request so to do, or in case an Event of Default
shall have occurred and be continuing, the Trustee alone shall have the power to make such
appointment. No co-trustee or separate trustee hereunder shall be required to meet the terms
of eligibility as a successor trustee under Section 8.06 hereunder and no notice to Holders
of Certificates of the appointment of co-trustee(s) or separate trustee(s) shall be required
under Section 8.08 hereof.
(b) In the case of any appointment of a co-trustee or separate trustee pursuant to this
Section 8.10 all rights, powers, duties and obligations conferred or imposed upon the
Trustee shall be conferred or imposed upon and exercised or performed by the Trustee, and
such separate trustee or co-trustee jointly, except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed (whether as Trustee
hereunder or as successor to the Master Servicer hereunder), the Trustee shall be
incompetent or unqualified to perform such act or acts, in which event such rights, powers,
duties and obligations (including the holding of title to the Trust Fund or any portion
thereof in any such jurisdiction) shall be exercised and performed by such separate trustee
or co-trustee at the direction of the Trustee.
(c) Any notice, request or other writing given to the Trustee shall be deemed to have
been given to each of the then separate trustees and co-trustees, as effectively as if given
to each of them. Every instrument appointing any separate trustee or co-trustee shall refer
to this Agreement and the conditions of this Article VIII. Each separate trustee and
co-trustee, upon its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the Trustee or
separately, as may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct of,
affecting the liability of, or affording protection to, the Trustee. Every such instrument
shall be filed with the Trustee.
(d) Any separate trustee or co-trustee may, at any time, constitute the Trustee, its
agent or attorney-in-fact, with full power and authority, to the extent not prohibited by
law, to do any lawful act under or in respect of this Agreement on its behalf and in its
name. If any separate trustee or co-trustee shall die, become incapable of acting, resign or
be removed, all of its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the appointment of a new
or successor trustee.
Section 8.11. Appointment of Custodians.
The Trustee may, with the consent of the Master Servicer and the Depositor, appoint
one or more Custodians who are not Affiliates of the Depositor or the Master Servicer to
hold all or a portion of the Mortgage Files as agent for the Trustee, by entering into a
Custodial Agreement. The Trustee is hereby directed to enter into Custodial Agreement with
▇▇▇▇▇ Fargo Bank, N.A. Subject to Article VIII, the Trustee agrees to comply with the terms
of each Custodial Agreement and to enforce the terms and provisions thereof against the
Custodian for the benefit of the Certificateholders. Each Custodian shall be a depository
institution subject to supervision by federal or state authority, shall have a combined
capital and surplus of at least $15,000,000 and shall be qualified to do business in the
jurisdiction in which it holds any Mortgage File. Each Custodial Agreement may be amended
only as provided in Section 11.01. The Trustee shall notify the Certificateholders of the
appointment of any Custodian (other than the Custodian appointed as of the Closing Date)
pursuant to this Section 8.11.
Section 8.12. Appointment of Office or Agency
The Trustee will maintain an office or agency in the New York where Certificates may
be surrendered for registration of transfer or exchange. The Trustee initially designates
its offices located at ▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ for the purpose
of keeping the Certificate Register. The Trustee will maintain an office at the address
stated in Section 11.05 hereof where notices and demands to or upon the Trustee in respect
of this Agreement may be served.
Section 8.13. DTC Letter of Representations.
The Trustee is hereby authorized and directed to, and agrees that it shall, enter
into the DTC Letter on behalf of the Trust Fund and in its individual capacity as agent
thereunder.
Section 8.14. Yield Maintenance Agreement
The Trustee is hereby authorized and directed to, and agrees that it shall, enter
into the Yield Maintenance Agreement on behalf of the Trust Fund.
ARTICLE IX
TERMINATION
Section 9.01. Termination Upon Purchase by Residential Funding or Liquidation of All
Mortgage Loans.
(a) Subject to Section 9.02, the respective obligations and responsibilities of the
Depositor, the Master Servicer and the Trustee created hereby in respect of the Certificates
(other than the obligation of the Trustee to make certain payments after the Final
Distribution Date to Certificateholders and the obligation of the Depositor to send certain
notices as hereinafter set forth) shall terminate upon the last action required to be taken
by the Trustee on the Final Distribution Date pursuant to this Article IX following the
earlier of:
(i) the later of the final payment or other liquidation (or any Advance with respect
thereto) of the last Mortgage Loan remaining in the Trust Fund or the disposition of
all property acquired upon foreclosure or deed in lieu of foreclosure of any Mortgage
Loan, or
(ii) the purchase by the Master Servicer or its designee of all Mortgage Loans and all
property acquired in respect of any Mortgage Loan remaining in the Trust Fund, at a
price equal to 100% of the unpaid principal balance of each Mortgage Loan (or, if
less than such unpaid principal balance, the fair market value of the related
underlying property of such Mortgage Loan with respect to Mortgage Loans as to which
title has been acquired if such fair market value is less than such unpaid principal
balance) (net of unreimbursed Advances attributable to principal) on the day of
repurchase, plus unpaid accrued interest thereon at the Mortgage Rate (or Modified
Net Mortgage Rate in the case of any Modified Mortgage Loan) from the Due Date to
which interest was last paid by the Mortgagor to, but not including, the first day of
the month in which such repurchase price is distributed plus the amount of any
accrued and unpaid Servicing Fees, unreimbursed advances and Servicing Advances, in
each case through the date of such option; provided, however, that in no event shall
the trust created hereby continue beyond the earlier of (i) the Maturity Date or (ii)
the expiration of 21 years from the death of the last survivor of the descendants of
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late ambassador of the United States to the Court of St.
▇▇▇▇▇, living on the date hereof; and provided further, that the purchase price set
forth above shall be increased as is necessary, as determined by the Master Servicer,
to avoid disqualification of any REMIC created hereunder as a REMIC. The purchase
price paid by the Master Servicer or its designee shall also include any amounts owed
by the Master Servicer or its designee pursuant to the last paragraph of Section 4 of
the Assignment Agreement in respect of any liability, penalty or expense that
resulted from a breach of the representation and warranty set forth in clause (bb) of
such Section, that remain unpaid on the date of such purchase.
The right of the Master Servicer or its designee to purchase all the assets of the
Trust Fund relating to the Mortgage Loans, pursuant to clause (ii) above is conditioned upon
the date of such purchase occurring on or after the Optional Termination Date. If such right
is exercised by the Master Servicer or its designee, the Master Servicer shall be entitled
to reimbursement for the full amount of any unreimbursed Advances theretofore made by it
with respect to the Mortgage Loans being purchased, pursuant to Section 3.10. In addition,
the Master Servicer shall provide to the Trustee the certification required by Section 3.15
and the Trustee and any Custodian shall, promptly following payment of the purchase price,
release to the Master Servicer or its designee the Mortgage Files pertaining to the Mortgage
Loans being purchased.
In addition, on any Distribution Date on or after the Optional Termination Date, the
Master Servicer or its designee shall have the right, at its option or at the option of its
designee, respectively, to purchase all of the Certificates in whole, but not in part, at a
price equal to the aggregate outstanding Certificate Principal Balance of the Certificates,
plus one month's Accrued Certificate Interest on the Certificates, any previously unpaid
Accrued Certificate Interest, and any unpaid Prepayment Interest Shortfalls previously
allocated thereto.
(b) The Master Servicer shall give the Trustee not less than 60 days' prior notice of the
Distribution Date on which the Master Servicer anticipates that the final distribution will
be made to Certificateholders (whether as a result of the exercise by the Master Servicer or
its designee of its right to purchase the assets of the Trust Fund or otherwise). Notice of
any termination, specifying the anticipated Final Distribution Date (which shall be a date
that would otherwise be a Distribution Date) upon which the Certificateholders may surrender
their Certificates to the Trustee for payment of the final distribution and cancellation,
shall be given promptly by the Master Servicer (if the Master Servicer or its designee is
exercising its right to purchase the assets of the Trust Fund), or by the Trustee (in any
other case) by letter to Certificateholders mailed not earlier than the 15th day and not
later than the 25th day of the month next preceding the month of such final distribution
specifying:
(i) the anticipated Final Distribution Date upon which final payment of the Certificates
is anticipated to be made upon presentation and surrender of Certificates at the
office or agency of the Trustee therein designated,
(ii) the amount of any such final payment, if known, and
(iii) that the Record Date otherwise applicable to such Distribution Date is not
applicable, and that payment will be made only upon presentation and surrender of the
Certificates at the office or agency of the Trustee therein specified.
If the Master Servicer or the Trustee is obligated to give notice to
Certificateholders as aforesaid, it shall give such notice to the Certificate Registrar at
the time such notice is given to Certificateholders. In the event such notice is given by
the Master Servicer, the Master Servicer or its designee shall deposit in the Custodial
Account before the Final Distribution Date in immediately available funds an amount equal to
the purchase price for the assets of the Trust Fund computed as above provided. The Master
Servicer shall provide to the Trustee written notification of any change to the anticipated
Final Distribution Date as soon as practicable. If the Trust Fund is not terminated on the
anticipated Final Distribution Date, for any reason, the Trustee shall promptly mail notice
thereof to each affected Certificateholder.
(c) Upon presentation and surrender of the Certificates by the Certificateholders, the
Trustee shall distribute to the Certificateholders (i) the amount otherwise distributable on
such Distribution Date, if not in connection with the Master Servicer's election to
repurchase, or (ii) if the Master Servicer elected to so repurchase, an amount equal to the
outstanding Certificate Principal Balance thereof, plus Accrued Certificate Interest thereon
for the related Interest Accrual Period and any previously unpaid Accrued Certificate
Interest and any unpaid Prepayment Interest Shortfall previously allocated thereto.
(d) In the event that any Certificateholders shall not surrender their Certificates for
final payment and cancellation on or before the Final Distribution Date, the Trustee shall
on such date cause all funds in the Certificate Account not distributed in final
distribution to Certificateholders to be withdrawn therefrom and credited to the remaining
Certificateholders by depositing such funds in a separate escrow account for the benefit of
such Certificateholders, and the Master Servicer (if the Master Servicer or its designee
exercised its right to purchase the Mortgage Loans), or the Trustee (in any other case)
shall give a second written notice to the remaining Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect thereto. If
within six months after the second notice any Certificate shall not have been surrendered
for cancellation, the Trustee shall take appropriate steps as directed by the Master
Servicer to contact the remaining Certificateholders concerning surrender of their
Certificates. The costs and expenses of maintaining the Escrow Account and of contacting
Certificateholders shall be paid out of the assets which remain in the Escrow Account. If
within nine months after the second notice any Certificates shall not have been surrendered
for cancellation, the Trustee shall pay to the Master Servicer all amounts distributable to
the holders thereof and the Master Servicer shall thereafter hold such amounts until
distributed to such holders. No interest shall accrue or be payable to any Certificateholder
on any amount held in the Escrow Account or by the Master Servicer as a result of such
Certificateholder's failure to surrender its Certificate(s) for final payment thereof in
accordance with this Section 9.01 and the Certificateholders shall look only to the Master
Servicer for such payment.
All rights of the Master Servicer or its designee to purchase the assets of the Trust Fund,
or to purchase specified classes of Certificates, as set forth in Section 9.01(a) are
referred to in this Agreement as the "Call Rights". Notwithstanding any other provision of
this Agreement, the Master Servicer or its designee shall have the right to sell, transfer,
pledge or otherwise assign the Call Rights at any time to any Person. Upon written notice by
the Master Servicer or its designee to the Trustee and the Master Servicer of any such
assignment of the Call Rights to any assignee, the Trustee and the Master Servicer shall be
obligated to recognize such assignee as the holder of the Call Rights. Such entity, if not
the Master Servicer or its designee or an affiliate, shall be deemed to represent, at the
time of such sale, transfer, pledge or other assignment, that one of the following will be,
and at the time the Call Right is exercised is, true and correct: (i) the exercise of such
Call Right shall not result in a non-exempt prohibited transaction under section 406 of
ERISA or section 4975 of the Code (including by reason of U.S. Department of Labor ("DOL")
Prohibited Transaction Class Exemption ("PTCE") 75-1 (Part I), 84-14, 90-1, 91-38, 95-60 or
96-23 or other applicable exemption) or (ii) such entity is (A) not a party in interest
under section 3(14) of ERISA or a disqualified person under section 4975(e)(2) of the Code
with respect to any employee benefit plan subject to section 3(3) of ERISA or any plan
subject to section 4975 of the Code (other than an employee benefit plan or plan sponsored
or maintained by the entity, provided that no assets of such employee benefit plan or plan
are invested or deemed to be invested in the Certificates) and (B) not a "benefit plan
investor" as described in DOL regulation section 2510.3-101(f)(2). If any such assignee of
the Call Right is unable to exercise such Call Right by reason of the preceding sentence,
then the Call Right shall revert to the immediately preceding assignor of such Call Right
subject to the rights of any secured party therein.
Section 9.02. Additional Termination Requirements.
(a) Each of REMIC I and REMIC II as the case may be, shall be terminated in accordance
with the following additional requirements, unless the Trustee and the Master Servicer have
received an Opinion of Counsel (which Opinion of Counsel shall not be an expense of the
Trustee) to the effect that the failure of any REMIC created hereunder, as the case may be,
to comply with the requirements of this Section 9.02 will not (i) result in the imposition
on the Trust Fund of taxes on "prohibited transactions," as described in Section 860F of the
Code, or (ii) cause any REMIC created hereunder to fail to qualify as a REMIC at any time
that any Certificate is outstanding:
(i) The Master Servicer shall establish a 90-day liquidation period for each of REMIC I
and REMIC II, and specify the first day of such period in a statement attached to the
Trust Fund's final Tax Return pursuant to Treasury regulations Section 1.860F-1. The
Master Servicer also shall satisfy all of the requirements of a qualified liquidation
for each of REMIC I and REMIC II under Section 860F of the Code and the regulations
thereunder;
(ii) The Master Servicer shall notify the Trustee at the commencement of such 90-day
liquidation period and, at or prior to the time of making of the final payment on the
Certificates, the Trustee shall sell or otherwise dispose of all of the remaining
assets of the Trust Fund in accordance with the terms hereof; and
(iii) If the Master Servicer is exercising its right to purchase the assets of the Trust
Fund, the Master Servicer shall, during the 90-day liquidation period and at or prior
to the Final Distribution Date, purchase all of the assets of the Trust Fund for cash.
(b) Each Holder of a Certificate and the Trustee hereby irrevocably approves and appoints
the Master Servicer as its attorney-in-fact to adopt a plan of complete liquidation for each
of REMIC I and REMIC II at the expense of the Trust Fund in accordance with the terms and
conditions of this Agreement.
ARTICLE X
REMIC PROVISIONS
Section 10.01. REMIC Administration.
(a) The REMIC Administrator shall make an election to treat each of REMIC I and REMIC II
as a REMIC under the Code and, if necessary, under applicable state law. Such election will
be made on Form 1066 or other appropriate federal tax or information return (including Form
8811) or any appropriate state return for the taxable year ending on the last day of the
calendar year in which the Certificates are issued. The REMIC I Regular Interests shall be
designated as the "regular interests" and the Class R-I Certificates shall be designated as
the sole class of "residual interests" in REMIC I. The REMIC II Regular Interests shall be
designated as the "regular interests" and the Class R-II Certificates shall be designated as
the sole class of "residual interests" in REMIC II. The REMIC Administrator and the Trustee
shall not permit the creation of any "interests" (within the meaning of Section 860G of the
Code) in REMIC I and REMIC II other than the REMIC I Regular Interests, the REMIC II Regular
Interests and the Certificates.
(b) The Closing Date is hereby designated as the "startup day" of each of REMIC within
the meaning of Section 860G(a)(9) of the Code.
(c) The REMIC Administrator shall hold a Class R Certificate in each REMIC representing a
0.01% Percentage Interest of the Class R Certificates in each REMIC and shall be designated
as the "tax matters person" with respect to each of REMIC I and REMIC II in the manner
provided under Treasury regulations section 1.860F-4(d) and Treasury regulations section
301.6231(a)(7)-1. The REMIC Administrator, as tax matters person, shall (i) act on behalf of
each of REMIC I and REMIC II in relation to any tax matter or controversy involving the
Trust Fund and (ii) represent the Trust Fund in any administrative or judicial proceeding
relating to an examination or audit by any governmental taxing authority with respect
thereto. The legal expenses, including without limitation attorneys' or accountants' fees,
and costs of any such proceeding and any liability resulting therefrom shall be expenses of
the Trust Fund and the REMIC Administrator shall be entitled to reimbursement therefor out
of amounts attributable to the Mortgage Loans on deposit in the Custodial Account as
provided by Section 3.10 unless such legal expenses and costs are incurred by reason of the
REMIC Administrator's willful misfeasance, bad faith or gross negligence. If the REMIC
Administrator is no longer the Master Servicer hereunder, at its option the REMIC
Administrator may continue its duties as REMIC Administrator and shall be paid reasonable
compensation not to exceed $3,000 per year by any successor Master Servicer hereunder for so
acting as the REMIC Administrator.
(d) The REMIC Administrator shall prepare or cause to be prepared all of the Tax Returns
that it determines are required with respect to the REMICs created hereunder and deliver
such Tax Returns in a timely manner to the Trustee and the Trustee shall sign and file such
Tax Returns in a timely manner. The expenses of preparing such returns shall be borne by the
REMIC Administrator without any right of reimbursement therefor. The REMIC Administrator
agrees to indemnify and hold harmless the Trustee with respect to any tax or liability
arising from the Trustee's signing of Tax Returns that contain errors or omissions. The
Trustee and Master Servicer shall promptly provide the REMIC Administrator with such
information as the REMIC Administrator may from time to time request for the purpose of
enabling the REMIC Administrator to prepare Tax Returns.
(e) The REMIC Administrator shall provide (i) to any Transferor of a Class R Certificate
such information as is necessary for the application of any tax relating to the transfer of
a Class R Certificate to any Person who is not a Permitted Transferee, (ii) to the Trustee
and the Trustee shall forward to the Certificateholders such information or reports as are
required by the Code or the REMIC Provisions including reports relating to interest,
original issue discount, if any, and market discount or premium (using the Prepayment
Assumption) and (iii) to the Internal Revenue Service the name, title, address and telephone
number of the person who will serve as the representative of each REMIC created hereunder.
(f) The Master Servicer and the REMIC Administrator shall take such actions and shall
cause each REMIC created hereunder to take such actions as are reasonably within the Master
Servicer's or the REMIC Administrator's control and the scope of its duties more
specifically set forth herein as shall be necessary or desirable to maintain the status
thereof as a REMIC under the REMIC Provisions (and the Trustee shall assist the Master
Servicer and the REMIC Administrator, to the extent reasonably requested by the Master
Servicer and the REMIC Administrator to do so). In performing their duties as more
specifically set forth herein, the Master Servicer and the REMIC Administrator shall not
knowingly or intentionally take any action, cause the Trust Fund to take any action or fail
to take (or fail to cause to be taken) any action reasonably within their respective control
and the scope of duties more specifically set forth herein, that, under the REMIC
Provisions, if taken or not taken, as the case may be, could (i) endanger the status of any
REMIC created hereunder as a REMIC or (ii) with the exception of actions taken in connection
with Section 4.08 hereof, resulting in the imposition of a tax upon any REMIC created
hereunder (including but not limited to the tax on prohibited transactions as defined in
Section 860F(a)(2) of the Code (except as provided in Section 2.04) and the tax on
contributions to a REMIC set forth in Section 860G(d) of the Code) (either such event, in
the absence of an Opinion of Counsel or the indemnification referred to in this sentence, an
"Adverse REMIC Event") unless the Master Servicer or the REMIC Administrator, as applicable,
has received an Opinion of Counsel (at the expense of the party seeking to take such action
or, if such party fails to pay such expense, and the Master Servicer or the REMIC
Administrator, as applicable, determines that taking such action is in the best interest of
the Trust Fund and the Certificateholders, at the expense of the Trust Fund, but in no event
at the expense of the Master Servicer, the REMIC Administrator or the Trustee) to the effect
that the contemplated action will not, with respect to the Trust Fund created hereunder,
endanger such status or, unless the Master Servicer or the REMIC Administrator or both, as
applicable, determine in its or their sole discretion to indemnify the Trust Fund against
the imposition of such a tax, result in the imposition of such a tax. Wherever in this
Agreement a contemplated action may not be taken because the timing of such action might
result in the imposition of a tax on the Trust Fund, or may only be taken pursuant to an
Opinion of Counsel that such action would not impose a tax on the Trust Fund, such action
may nonetheless be taken provided that the indemnity given in the preceding sentence with
respect to any taxes that might be imposed on the Trust Fund has been given and that all
other preconditions to the taking of such action have been satisfied. The Trustee shall not
take or fail to take any action (whether or not authorized hereunder) as to which the Master
Servicer or the REMIC Administrator, as applicable, has advised it in writing that it has
received an Opinion of Counsel to the effect that an Adverse REMIC Event could occur with
respect to such action or inaction, as the case may be. In addition, prior to taking any
action with respect to the Trust Fund or its assets, or causing the Trust Fund to take any
action, which is not expressly permitted under the terms of this Agreement, the Trustee
shall consult with the Master Servicer or the REMIC Administrator, as applicable, or its
designee, in writing, with respect to whether such action could cause an Adverse REMIC Event
to occur with respect to the Trust Fund and the Trustee shall not take any such action or
cause the Trust Fund to take any such action as to which the Master Servicer or the REMIC
Administrator, as applicable, has advised it in writing that an Adverse REMIC Event could
occur. The Master Servicer or the REMIC Administrator, as applicable, may consult with
counsel to make such written advice, and the cost of same shall be borne by the party
seeking to take the action not expressly permitted by this Agreement, but in no event at the
expense of the Master Servicer or the REMIC Administrator. At all times as may be required
by the Code, the Master Servicer or the REMIC Administrator, as applicable, will to the
extent within its control and the scope of its duties more specifically set forth herein,
maintain substantially all of the assets of the REMIC as "qualified mortgages" as defined in
Section 860G(a)(3) of the Code and "permitted investments" as defined in Section 860G(a)(5)
of the Code.
(g) In the event that any tax is imposed on "prohibited transactions" of any REMIC
created hereunder as defined in Section 860F(a)(2) of the Code, on "net income from
foreclosure property" of any REMIC as defined in Section 860G(c) of the Code, on any
contributions to any REMIC after the Startup Date therefor pursuant to Section 860G(d) of
the Code, or any other tax imposed by the Code or any applicable provisions of state or
local tax laws, such tax shall be charged (i) to the Master Servicer, if such tax arises out
of or results from a breach by the Master Servicer in its role as Master Servicer or REMIC
Administrator of any of its obligations under this Agreement or the Master Servicer has in
its sole discretion determined to indemnify the Trust Fund against such tax, (ii) to the
Trustee, if such tax arises out of or results from a breach by the Trustee of any of its
obligations under this Article X, or (iii) otherwise against amounts on deposit in the
Custodial Account as provided by Section 3.10 and on the Distribution Date(s) following such
reimbursement the aggregate of such taxes shall be allocated in reduction of the Accrued
Certificate Interest on each Class entitled thereto in the same manner as if such taxes
constituted a Prepayment Interest Shortfall.
(h) The Trustee and the Master Servicer shall, for federal income tax purposes, maintain
books and records with respect to each REMIC on a calendar year and on an accrual basis or
as otherwise may be required by the REMIC Provisions.
(i) Following the Startup Date, neither the Master Servicer nor the Trustee shall accept
any contributions of assets to any REMIC unless (subject to Section 10.01(f)) the Master
Servicer and the Trustee shall have received an Opinion of Counsel (at the expense of the
party seeking to make such contribution) to the effect that the inclusion of such assets in
any REMIC will not cause any REMIC created hereunder to fail to qualify as a REMIC at any
time that any Certificates are outstanding or subject any such REMIC to any tax under the
REMIC Provisions or other applicable provisions of federal, state and local law or
ordinances.
(j) Neither the Master Servicer nor the Trustee shall (subject to Section 10.01(f)) enter
into any arrangement by which any REMIC created hereunder will receive a fee or other
compensation for services nor permit any REMIC created hereunder to receive any income from
assets other than "qualified mortgages" as defined in Section 860G(a)(3) of the Code or
"permitted investments" as defined in Section 860G(a)(5) of the Code.
(k) Solely for the purposes of Section 1.860G-1(a)(4)(iii) of the Treasury Regulations,
the "latest possible maturity date" by which the principal balance of each regular interest
in each REMIC would be reduced to zero is December 25, 2035, which is the Distribution Date
in the month following the last scheduled payment on any Mortgage Loan.
(l) Within 30 days after the Closing Date, the REMIC Administrator shall prepare and file
with the Internal Revenue Service Form 8811, "Information Return for Real Estate Mortgage
Investment Conduits (REMIC) and Issuers of Collateralized Debt Obligations" for the Trust
Fund.
(m) Neither the Trustee nor the Master Servicer shall sell, dispose of or substitute for
any of the Mortgage Loans (except in connection with (i) the default, imminent default or
foreclosure of a Mortgage Loan, including but not limited to, the acquisition or sale of a
Mortgaged Property acquired by any REMIC pursuant to Article IX of this Agreement or (ii) a
purchase of Mortgage Loans pursuant to Article II or III of this Agreement) or acquire any
assets for any REMIC or sell or dispose of any investments in the Custodial Account or the
Certificate Account for gain, or accept any contributions to any REMIC after the Closing
Date unless it has received an Opinion of Counsel that such sale, disposition, substitution
or acquisition will not (a) affect adversely the status of any REMIC created hereunder as a
REMIC or (b) unless the Master Servicer has determined in its sole discretion to indemnify
the Trust Fund against such tax, cause any REMIC to be subject to a tax on "prohibited
transactions" or "contributions" pursuant to the REMIC Provisions.
Section 10.02. Master Servicer, REMIC Administrator and Trustee Indemnification.
(a) The Trustee agrees to indemnify the Trust Fund, the Depositor, the REMIC
Administrator and the Master Servicer for any taxes and costs including, without limitation,
any reasonable attorneys' fees imposed on or incurred by the Trust Fund, the Depositor or
the Master Servicer, as a result of a breach of the Trustee's covenants set forth in Article
VIII or this Article X. In the event that Residential Funding is no longer the Master
Servicer, the Trustee shall indemnify Residential Funding for any taxes and costs including,
without limitation, any reasonable attorneys' fees imposed on or incurred by Residential
Funding as a result of a breach of the Trustee's covenants set forth in Article VIII or this
Article X.
(b) The REMIC Administrator agrees to indemnify the Trust Fund, the Depositor, the Master
Servicer and the Trustee for any taxes and costs (including, without limitation, any
reasonable attorneys' fees) imposed on or incurred by the Trust Fund, the Depositor, the
Master Servicer or the Trustee, as a result of a breach of the REMIC Administrator's
covenants set forth in this Article X with respect to compliance with the REMIC Provisions,
including without limitation, any penalties arising from the Trustee's execution of Tax
Returns prepared by the REMIC Administrator that contain errors or omissions; provided,
however, that such liability will not be imposed to the extent such breach is a result of an
error or omission in information provided to the REMIC Administrator by the Master Servicer
in which case Section 10.02(c) will apply.
(c) The Master Servicer agrees to indemnify the Trust Fund, the Depositor, the REMIC
Administrator and the Trustee for any taxes and costs (including, without limitation, any
reasonable attorneys' fees) imposed on or incurred by the Trust Fund, the Depositor, the
REMIC Administrator or the Trustee, as a result of a breach of the Master Servicer's
covenants set forth in this Article X or in Article III with respect to compliance with the
REMIC Provisions, including without limitation, any penalties arising from the Trustee's
execution of Tax Returns prepared by the Master Servicer that contain errors or omissions.
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01. Amendment.
(a) This Agreement or any Custodial Agreement may be amended from time to time by the
Depositor, the Master Servicer and the Trustee, without the consent of any of the
Certificateholders:
(i) to cure any ambiguity,
(ii) to correct or supplement any provisions herein or therein, which may be inconsistent
with any other provisions herein or therein or to correct any error,
(iii) to modify, eliminate or add to any of its provisions to such extent as shall be
necessary or desirable to maintain the qualification of any REMIC created hereunder
as a REMIC at all times that any Certificate is outstanding or to avoid or minimize
the risk of the imposition of any tax on the Trust Fund pursuant to the Code that
would be a claim against the Trust Fund, provided that the Trustee has received an
Opinion of Counsel to the effect that (A) such action is necessary or desirable to
maintain such qualification or to avoid or minimize the risk of the imposition of any
such tax and (B) such action will not adversely affect in any material respect the
interests of any Certificateholder,
(iv) to change the timing and/or nature of deposits into the Custodial Account or the
Certificate Account or to change the name in which the Custodial Account is
maintained, provided that (A) the Certificate Account Deposit Date shall in no event
be later than the related Distribution Date, (B) such change shall not, as evidenced
by an Opinion of Counsel, adversely affect in any material respect the interests of
any Certificateholder and (C) such change shall not result in a reduction of the
rating assigned to any Class of Certificates below the lower of the then-current
rating or the rating assigned to such Certificates as of the Closing Date, as
evidenced by a letter from each Rating Agency to such effect,
(v) to modify, eliminate or add to the provisions of Section 5.02(f) or any other
provision hereof restricting transfer of the Class R Certificates by virtue of their
being the "residual interests" in the Trust Fund provided that (A) such change shall
not result in reduction of the rating assigned to any such Class of Certificates
below the lower of the then-current rating or the rating assigned to such
Certificates as of the Closing Date, as evidenced by a letter from each Rating Agency
to such effect, and (B) such change shall not, as evidenced by an Opinion of Counsel
(at the expense of the party seeking so to modify, eliminate or add such provisions),
cause the Trust Fund or any of the Certificateholders (other than the transferor) to
be subject to a federal tax caused by a transfer to a Person that is not a Permitted
Transferee, or
(vi) to make any other provisions with respect to matters or questions arising under this
Agreement or such Custodial Agreement which shall not be materially inconsistent with
the provisions of this Agreement, provided that such action shall not, as evidenced
by an Opinion of Counsel, adversely affect in any material respect the interests of
any Certificateholder.
(b) This Agreement or any Custodial Agreement may also be amended from time to time by
the Depositor, the Master Servicer, the Trustee and the Holders of Certificates evidencing
in the aggregate not less than 66% of the Percentage Interests of each Class of Certificates
with a Certificate Principal Balance greater than zero affected thereby for the purpose of
adding any provisions to or changing in any manner or eliminating any of the provisions of
this Agreement or such Custodial Agreement or of modifying in any manner the rights of the
Holders of Certificates of such Class; provided, however, that no such amendment shall:
(i) reduce in any manner the amount of, or delay the timing of, payments which are
required to be distributed on any Certificate without the consent of the Holder of
such Certificate,
(ii) adversely affect in any material respect the interest of the Holders of Certificates
of any Class in a manner other than as described in clause (i) hereof without the
consent of Holders of Certificates of such Class evidencing, as to such Class,
Percentage Interests aggregating not less than 66%, or
(iii) reduce the aforesaid percentage of Certificates of any Class the Holders of which are
required to consent to any such amendment, in any such case without the consent of
the Holders of all Certificates of such Class then outstanding.
(c) Notwithstanding any contrary provision of this Agreement, the Trustee shall not
consent to any amendment to this Agreement unless it shall have first received an Opinion of
Counsel (at the expense of the party seeking such amendment) to the effect that such
amendment is permitted under this Agreement and that such amendment or the exercise of any
power granted to the Master Servicer, the Depositor or the Trustee in accordance with such
amendment will not result in the imposition of a federal tax on the Trust Fund or cause any
REMIC created hereunder to fail to qualify as a REMIC at any time that any Certificate is
outstanding. The Trustee may but shall not be obligated to enter into any amendment pursuant
to this Section that affects its rights, duties and immunities and this Agreement or
otherwise; provided however, such consent shall not be unreasonably withheld.
(d) Promptly after the execution of any such amendment the Trustee shall furnish written
notification of the substance of such amendment to each Certificateholder. It shall not be
necessary for the consent of Certificateholders under this Section 11.01 to approve the
particular form of any proposed amendment, but it shall be sufficient if such consent shall
approve the substance thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Certificateholders shall be subject to such
reasonable regulations as the Trustee may prescribe.
(e) The Depositor shall have the option, in its sole discretion, to obtain and deliver to
the Trustee any corporate guaranty, payment obligation, irrevocable letter of credit, surety
bond, insurance policy or similar instrument or a reserve fund, or any combination of the
foregoing, for the purpose of protecting the Holders of the Class R Certificates against any
or all Realized Losses or other shortfalls. Any such instrument or fund shall be held by the
Trustee for the benefit of the Class R Certificateholders, but shall not be and shall not be
deemed to be under any circumstances included in any REMIC. To the extent that any such
instrument or fund constitutes a reserve fund for federal income tax purposes, (i) any
reserve fund so established shall be an outside reserve fund and not an asset of such REMIC,
(ii) any such reserve fund shall be owned by the Depositor, and (iii) amounts transferred by
such REMIC to any such reserve fund shall be treated as amounts distributed by such REMIC to
the Depositor or any successor, all within the meaning of Treasury regulations Section
1.860G-2(h). In connection with the provision of any such instrument or fund, this Agreement
and any provision hereof may be modified, added to, deleted or otherwise amended in any
manner that is related or incidental to such instrument or fund or the establishment or
administration thereof, such amendment to be made by written instrument executed or
consented to by the Depositor and such related insurer but without the consent of any
Certificateholder and without the consent of the Master Servicer or the Trustee being
required unless any such amendment would impose any additional obligation on, or otherwise
adversely affect the interests of the Certificateholders, the Master Servicer or the
Trustee, as applicable; provided that the Depositor obtains an Opinion of Counsel (which
need not be an opinion of Independent counsel) to the effect that any such amendment will
not cause (a) any federal tax to be imposed on the Trust Fund, including without limitation,
any federal tax imposed on "prohibited transactions" under Section 860F(a)(1) of the Code or
on "contributions after the startup date" under Section 860G(d)(1) of the Code and (b) any
REMIC created hereunder to fail to qualify as a REMIC at any time that any Certificate is
outstanding. In the event that the Depositor elects to provide such coverage in the form of
a limited guaranty provided by General Motors Acceptance Corporation, the Depositor may
elect that the text of such amendment to this Agreement shall be substantially in the form
attached hereto as Exhibit L (in which case Residential Funding's Subordinate Certificate
Loss Obligation as described in such exhibit shall be established by Residential Funding's
consent to such amendment) and that the limited guaranty shall be executed in the form
attached hereto as Exhibit M, with such changes as the Depositor shall deem to be
appropriate; it being understood that the Trustee has reviewed and approved the content of
such forms and that the Trustee's consent or approval to the use thereof is not required.
In addition to the foregoing, any amendment to Section 4.08 of this Agreement shall
require the consent of the Limited Repurchase Right Holder as a third party beneficiary
Section 11.02. Recordation of Agreement; Counterparts.
(a) To the extent permitted by applicable law, this Agreement is subject to recordation
in all appropriate public offices for real property records in all the counties or other
comparable jurisdictions in which any or all of the properties subject to the Mortgages are
situated, and in any other appropriate public recording office or elsewhere, such
recordation to be effected by the Master Servicer and at its expense on direction by the
Trustee (pursuant to the request of the Holders of Certificates entitled to at least 25% of
the Voting Rights), but only upon direction accompanied by an Opinion of Counsel to the
effect that such recordation materially and beneficially affects the interests of the
Certificateholders.
(b) For the purpose of facilitating the recordation of this Agreement as herein provided
and for other purposes, this Agreement may be executed simultaneously in any number of
counterparts, each of which counterparts shall be deemed to be an original, and such
counterparts shall constitute but one and the same instrument.
Section 11.03. Limitation on Rights of Certificateholders.
(a) The death or incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust Fund, nor entitle such Certificateholder's legal representatives or
heirs to claim an accounting or to take any action or proceeding in any court for a
partition or winding up of the Trust Fund, nor otherwise affect the rights, obligations and
liabilities of any of the parties hereto.
(b) No Certificateholder shall have any right to vote (except as expressly provided
herein) or in any manner otherwise control the operation and management of the Trust Fund,
or the obligations of the parties hereto, nor shall anything herein set forth, or contained
in the terms of the Certificates, be construed so as to constitute the Certificateholders
from time to time as partners or members of an association; nor shall any Certificateholder
be under any liability to any third person by reason of any action taken by the parties to
this Agreement pursuant to any provision hereof.
(c) No Certificateholder shall have any right by virtue of any provision of this
Agreement to institute any suit, action or proceeding in equity or at law upon or under or
with respect to this Agreement, unless such Holder previously shall have given to the
Trustee a written notice of default and of the continuance thereof, as hereinbefore
provided, and unless also the Holders of Certificates of any Class evidencing in the
aggregate not less than 25% of the related Percentage Interests of such Class, shall have
made written request upon the Trustee to institute such action, suit or proceeding in its
own name as Trustee hereunder and shall have offered to the Trustee such reasonable
indemnity as it may require against the costs, expenses and liabilities to be incurred
therein or thereby, and the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity, shall have neglected or refused to institute any such action, suit
or proceeding it being understood and intended, and being expressly covenanted by each
Certificateholder with every other Certificateholder and the Trustee, that no one or more
Holders of Certificates of any Class shall have any right in any manner whatever by virtue
of any provision of this Agreement to affect, disturb or prejudice the rights of the Holders
of any other of such Certificates of such Class or any other Class, or to obtain or seek to
obtain priority over or preference to any other such Holder, or to enforce any right under
this Agreement, except in the manner herein provided and for the common benefit of
Certificateholders of such Class or all Classes, as the case may be. For the protection and
enforcement of the provisions of this Section 11.03, each and every Certificateholder and
the Trustee shall be entitled to such relief as can be given either at law or in equity.
Section 11.04. Governing Law.
This agreement and the Certificates shall be governed by and construed in accordance
with the laws of the State of New York and the obligations, rights and remedies of the
parties hereunder shall be determined in accordance with such laws, without regard to the
conflict of laws principles thereof, other than Sections 5-1401 and 5-1402 of the New York
General Obligations Law.
Section 11.05. Notices.
All demands and notices hereunder shall be in writing and shall be deemed to have
been duly given if personally delivered at or mailed by registered mail, postage prepaid
(except for notices to the Trustee which shall be deemed to have been duly given only when
received), to (a) in the case of the Depositor, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: President (RAMP), or such other address as may
hereafter be furnished to the Master Servicer and the Trustee in writing by the Depositor;
(b) in the case of the Master Servicer, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇, Attention: Bond Administration or such other address as may be hereafter
furnished to the Depositor and the Trustee by the Master Servicer in writing; (c) in the
case of the Trustee, ▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention:
Worldwide Securities Services / Global Debt, Attention: Residential Asset Mortgage Products
Inc. Series 2005-SP2 or such other address as may hereafter be furnished to the Depositor
and the Master Servicer in writing by the Trustee; (d) in the case of Standard & Poor's, ▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ Attention: Mortgage Surveillance or such other
address as may be hereafter furnished to the Depositor, Trustee and Master Servicer by
Standard & Poor's; (e) in the case of Moody's, ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: ABS Monitoring Department, or such other address as may be hereafter furnished to
the Depositor, the Trustee and the Master Servicer in writing by Moody's; and (f) in the
case of Fitch, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ABS Monitoring
Department, or such other address as may be hereafter furnished to the Depositor, the
Trustee and the Master Servicer in writing by Fitch. Any notice required or permitted to be
mailed to a Certificateholder shall be given by first class mail, postage prepaid, at the
address of such holder as shown in the Certificate Register. Any notice so mailed within the
time prescribed in this Agreement shall be conclusively presumed to have been duly given,
whether or not the Certificateholder receives such notice.
Section 11.06. Notices to Rating Agencies.
The Depositor, the Master Servicer or the Trustee, as applicable, (a) shall notify
each Rating Agency at such time as it is otherwise required pursuant to this Agreement to
give notice of the occurrence of, any of the events described in clause (a), (b), (c), (d),
(g), (h), (i) or (j) below, (b) shall notify the Subservicer at such time as it is otherwise
required pursuant to this Agreement to give notice of the occurrence of any of the events
described in clause (a), (b), (c)(1), (g)(1) or (i) below, or (c) provide a copy to each
Rating Agency at such time as otherwise required to be delivered pursuant to this Agreement
of any of the statements described in clauses (e) and (f) below:
(a) a material change or amendment to this Agreement,
(b) the occurrence of an Event of Default,
(c) (1) the termination or appointment of a successor Master Servicer or (2) the
termination or appointment of a successor Trustee or a change in the majority ownership of
the Trustee,
(d) the filing of any claim under the Master Servicer's blanket fidelity bond and the
errors and omissions insurance policy required by Section 3.12 or the cancellation or
modification of coverage under 152 any such instrument,
(e) the statement required to be delivered to the Holders of each Class of Certificates
pursuant to Section 4.03,
(f) the statements required to be delivered pursuant to Sections 3.18 and 3.19,
(g) (1) a change in the location of the Custodial Account or (2) a change in the location
of the Certificate Account,
(h) the occurrence of any monthly cash flow shortfall to the Holders of any Class of
Certificates resulting from the failure by the Master Servicer to make an Advance pursuant
to Section 4.04,
(i) the occurrence of the Final Distribution Date and
(j) the repurchase of or substitution for any Mortgage Loan,
provided, however, that with respect to notice of the occurrence of the events described in
clauses (d), (g) or (h) above, the Master Servicer shall provide prompt written notice to
each Rating Agency and the Subservicer of any such event known to the Master Servicer.
Section 11.07. Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms of this
Agreement shall be for any reason whatsoever held invalid, then such covenants, agreements,
provisions or terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Certificates or the
rights of the Holders thereof.
Section 11.08. Supplemental Provisions for Resecuritization.
(a) This Agreement may be supplemented by means of the addition of a separate Article
hereto (a "Supplemental Article") for the purpose of resecuritizing any of the Certificates
issued hereunder, under the following circumstances. With respect to any Class or Classes of
Certificates issued hereunder, or any portion of any such Class, as to which the Depositor
or any of its Affiliates (or any designee thereof) is the registered Holder (the
"Resecuritized Certificates"), the Depositor may deposit such Resecuritized Certificates into
a new REMIC, grantor trust or custodial arrangement (a "Restructuring Vehicle") to be held
by the Trustee pursuant to a Supplemental Article. The instrument adopting such Supplemental
Article shall be executed by the Depositor, the Master Servicer and the Trustee; provided,
that neither the Master Servicer nor the Trustee shall withhold their consent thereto if
their respective interests would not be materially adversely affected thereby. To the extent
that the terms of the Supplemental Article do not in any way affect any provisions of this
Agreement as to any of the Certificates initially issued hereunder, the adoption of the
Supplemental Article shall not constitute an "amendment" of this Agreement. Each
Supplemental Article shall set forth all necessary provisions relating to the holding of the
Resecuritized Certificates by the Trustee, the establishment of the Restructuring Vehicle,
the issuing of various classes of new certificates by the Restructuring Vehicle and the
distributions to be made thereon, and any other provisions necessary to the purposes
thereof. In connection with each Supplemental Article, the Depositor shall deliver to the
Trustee an Opinion of Counsel to the effect that (i) the Restructuring Vehicle will qualify
as a REMIC, grantor trust or other entity not subject to taxation for federal income tax
purposes and (ii) the adoption of the Supplemental Article will not endanger the status of
any REMIC created hereunder as a REMIC or result in the imposition of a tax upon the Trust
Fund (including but not limited to the tax on prohibited transaction as defined in Section
860F(a)(2) of the Code and the tax on contributions to a REMIC as set forth in Section
860G(d) of the Code.
Section 11.09. [Reserved].
Section 11.10. Third Party Beneficiaries.
The Limited Repurchase Right Holder is an express third-party beneficiary of Section
4.08 of this Agreement, and shall have the right to enforce the related provisions of
Section 4.08 of this Agreement as if it were a party hereto.
Pooling and Servicing Agreement
Series 2005-SP3
IN WITNESS WHEREOF, the Depositor, the Master Servicer and the Trustee have caused
their names to be signed hereto by their respective officers thereunto duly authorized and
their respective seals, duly attested, to be hereunto affixed, all as of the day and year
first above written.
[Seal] RESIDENTIAL ASSET MORTGAGE PRODUCTS, INC.
Attest: By:
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇ Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President Title: Vice President
[Seal] RESIDENTIAL FUNDING CORPORATION
Attest: By:
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇ Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Associate Title: Associate
[Seal] JPMORGAN CHASE BANK, N.A.
as Trustee
Attest: By:
Name: Name:
Title: Title:
STATE OF MINNESOTA )
) ss.:
COUNTY OF HENNEPIN )
On the _____ day of December, 2005 before me, a notary public in and for said
State, personally appeared ▇▇▇▇▇▇ ▇▇▇▇▇▇, known to me to be a Vice President of Residential
Asset Mortgage Products, Inc., one of the corporations that executed the within instrument,
and also known to me to be the person who executed it on behalf of said corporation, and
acknowledged to me that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal
the day and year in this certificate first above written.
Notary Public
_____________________________
[Notarial Seal]
STATE OF MINNESOTA )
) ss.:
COUNTY OF HENNEPIN )
On the _________ day of December, 2005 before me, a notary public in and for
said State, personally appeared ▇▇▇▇▇▇ ▇▇▇▇▇▇, known to me to be an Associate of Residential
Funding Corporation, one of the corporations that executed the within instrument, and also
known to me to be the person who executed it on behalf of said corporation, and acknowledged
to me that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal
the day and year in this certificate first above written.
Notary Public
___________________________
[Notarial Seal]
STATE OF MINNESOTA )
) ss.:
COUNTY OF ▇▇▇▇▇▇ )
On the _____ day of December, 2005 before me, a notary public in and for said
State, personally appeared _________________________, known to me to be a
__________________________ of JPMorgan Chase Bank, N.A., a national banking association,
that executed the within instrument, and also known to me to be the person who executed it
on behalf of said banking association and acknowledged to me that such banking association
executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal
the day and year in this certificate first above written.
Notary Public
___________________________
[Notarial Seal]
EXHIBIT A
FORM OF CLASS A CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A REGULAR INTEREST
IN A REAL ESTATE MORTGAGE INVESTMENT CONDUIT, AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN
SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE CODE).
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (DTC), TO ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN
THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE &
CO., HAS AN INTEREST HEREIN.
ANY TRANSFEREE OF CLASS A CERTIFICATE NOT RATED AT LEAST AA- (OR ITS EQUIVALENT) BY
STANDARD & POORS, MOODYS OR FITCH AT THE TIME OF PURCHASE WILL BE DEEMED TO HAVE
REPRESENTED BY VIRTUE OF ITS PURCHASE OR HOLDING OF SUCH CERTIFICATE (OR ANY INTEREST
HEREIN) THAT EITHER (A) SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN OR OTHER PLAN
SUBJECT TO THE PROHIBITED TRANSACTION PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED (ERISA), OR SECTION 4975 OF THE CODE (EACH, AN ERISA PLAN), OR
ANY PERSON (INCLUDING, WITHOUT LIMITATION, AN INVESTMENT MANAGER, A NAMED FIDUCIARY OR A
TRUSTEE OF ANY ERISA PLAN) WHO IS USING PLAN ASSETS, WITHIN THE MEANING OF THE U.S.
DEPARTMENT OF LABOR REGULATION PROMULGATED AT 29 C.F.R. 2510.3-101, OF ANY ERISA PLAN
(EACH, AN ERISA PLAN INVESTOR) TO EFFECT SUCH ACQUISITION, OR (B)(I) THE TRANSFEREE IS AN
INSURANCE COMPANY, (II) THE SOURCE OF FUNDS USED TO PURCHASE OR HOLD THE CERTIFICATE (OR ANY
INTEREST HEREIN) IS AN INSURANCE COMPANY GENERAL ACCOUNT (AS DEFINED IN U.S. DEPARTMENT OF
LABOR PROHIBITED TRANSACTION CLASS EXEMPTION (PTCE) 95-60), AND (III) THE CONDITIONS SET
FORTH IN SECTIONS I AND III OF PTCE 95-60 HAVE BEEN SATISFIED (EACH ENTITY THAT SATISFIES
THIS CLAUSE (B), A COMPLYING INSURANCE COMPANY).
IF THIS CERTIFICATE (OR ANY INTEREST HEREIN) IS ACQUIRED OR HELD IN VIOLATION OF THE
PROVISIONS OF THE PRECEDING PARAGRAPH, THEN THE LAST PRECEDING TRANSFEREE THAT EITHER (A) IS
NOT AN ERISA PLAN OR AN ERISA PLAN INVESTOR, OR (B) IS A COMPLYING INSURANCE COMPANY SHALL
BE RESTORED, TO THE EXTENT PERMITTED BY LAW, TO ALL RIGHTS AND OBLIGATIONS AS CERTIFICATE
OWNER THEREOF RETROACTIVE TO THE DATE OF SUCH TRANSFER OF THIS CERTIFICATE. THE TRUSTEE
SHALL BE UNDER NO LIABILITY TO ANY PERSON FOR MAKING ANY PAYMENTS DUE ON THIS CERTIFICATE TO
SUCH PRECEDING TRANSFEREE.
ANY PURPORTED CERTIFICATE OWNER WHOSE ACQUISITION OR HOLDING OF THIS CERTIFICATE (OR
ANY INTEREST HEREIN) WAS EFFECTED IN VIOLATION OF THE RESTRICTIONS IN SECTION 5.02(e) OF THE
POOLING AND SERVICING AGREEMENT SHALL INDEMNIFY AND HOLD HARMLESS THE DEPOSITOR, THE
TRUSTEE, THE MASTER SERVICER, ANY SUBSERVICER, AND THE TRUST FUND FROM AND AGAINST ANY AND
ALL LIABILITIES, CLAIMS, COSTS OR EXPENSES INCURRED BY SUCH PARTIES AS A RESULT OF SUCH
ACQUISITION OR HOLDING.
Certificate No. [____]
Class [A-___] Senior Percentage Interest: ____%
Date of Pooling and Servicing Agreement Aggregate Initial Certificate Principal
and Cut-off Date: Balance of the Class [A-___] Certificates:
December 1, 2005 $________
First Distribution Date: Initial Certificate Principal Balance of this
[______________] Certificate:
$[______________]
Master Servicer:
Residential Funding Corporation
[Assumed] [Scheduled] Final Distribution Date: CUSIP
[______________] [______________]
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 2005-SP3
evidencing a percentage interest in the distributions allocable
to the Class [A-___] Certificates with respect to a Trust Fund
consisting primarily of a pool of one- to four-family first and
second lien seasoned mortgage loans formed and sold by
RESIDENTIAL ASSET MORTGAGE PRODUCTS, INC.
This Certificate is payable solely from the assets of the Trust Fund, and does not
represent an obligation of or interest in Residential Asset Mortgage Products, Inc., the
Master Servicer, the Trustee referred to below or GMAC Mortgage Group, Inc. or any of their
affiliates. Neither this Certificate nor the underlying Mortgage Loans are guaranteed or
insured by any governmental agency or instrumentality or by Residential Asset Mortgage
Products, Inc., the Master Servicer, the Trustee or GMAC Mortgage Group, Inc. or any of
their affiliates. None of the Company, the Master Servicer, GMAC Mortgage Group, Inc. or
any of their affiliates will have any obligation with respect to any certificate or other
obligation secured by or payable from payments on the Certificates.
This certifies that _____________ is the registered owner of the Percentage Interest
evidenced by this Certificate (obtained by dividing the Initial Certificate Principal
Balance of this Certificate by the aggregate Initial Certificate Principal Balance of all
Class A Certificates, both as specified above) in certain distributions with respect to the
Trust Fund consisting primarily of an interest in a pool of one- to four-family first and
second lien seasoned mortgage loans (the Mortgage Loans), sold by Residential Asset
Mortgage Products, Inc. (hereinafter called the Company, which term includes any successor
entity under the Agreement referred to below). The Trust Fund was created pursuant to a
Pooling and Servicing Agreement dated as of December 1, 2005 (the Pooling and Servicing
Agreement or the Agreement) among the Company, the Master Servicer and JPMorgan Chase
Bank, N.A., as trustee (the Trustee), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized terms used
herein have the meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be made on the 25th day
of each month or, if such 25th day is not a Business Day, the Business Day immediately
following (the Distribution Date), commencing as described in the Agreement, to the Person
in whose name this Certificate is registered at the close of business on the last day (or if
such last day is not a Business Day, the Business Day immediately preceding such last day)
of the month immediately preceding the month of such distribution (the Record Date), from
the related Available Distribution Amount in an amount equal to the product of the
Percentage Interest evidenced by this Certificate and the amount required to be distributed
to Holders of Class A-__Certificates on such Distribution Date.
Distributions on this Certificate will be made either by the Master Servicer acting
on behalf of the Trustee or by a Paying Agent appointed by the Trustee in immediately
available funds (by wire transfer or otherwise) for the account of the Person entitled
thereto if such Person shall have so notified the Master Servicer or such Paying Agent, or
by check mailed to the address of the Person entitled thereto, as such name and address
shall appear on the Certificate Register.
Notwithstanding the above, the final distribution on this Certificate will be made
after due notice of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the office or agency appointed by the Trustee for that
purpose in the City and State of New York. The Initial Certificate Principal Balance of
this Certificate is set forth above. The Certificate Principal Balance hereof will be
reduced to the extent of distributions allocable to principal and any Realized Losses
allocable hereto.
As described above, any transferee of a Class A Certificate not rated at least AA-
(or its equivalent) by Standard & Poors, Moodys or Fitch at the time of purchase will be
deemed to have represented by virtue of its purchase or holding of such Certificate (or any
interest herein) that either (a) such transferee is not an ERISA Plan or an ERISA Plan
Investor, or (b) the transferee is a Complying Insurance Company. In addition, any
purported Certificate Owner whose acquisition or holding of this Certificate (or any
interest herein) was effected in violation of the restrictions in Section 5.02(e) of the
Agreement shall indemnify and hold harmless the Depositor, the Trustee, the Master Servicer,
any Subservicer, and the Trust Fund from and against any and all liabilities, claims, costs
or expenses incurred by such parties as a result of such acquisition or holding.
This Certificate is one of a duly authorized issue of Certificates issued in several
Classes designated as Mortgage Asset-Backed Pass-Through Certificates of the Series
specified hereon (herein collectively called the Certificates).
The Certificates are limited in right of payment to certain collections and
recoveries respecting the related Mortgage Loans, all as more specifically set forth herein
and in the Agreement. In the event Master Servicer funds are advanced with respect to any
Mortgage Loan, such advance is reimbursable to the Master Servicer, to the extent provided
in the Agreement, from related recoveries on such Mortgage Loan or from other cash that
would have been distributable to Certificateholders.
As provided in the Agreement, withdrawals from the Custodial Account and/or the
Certificate Account created for the benefit of Certificateholders may be made by the Master
Servicer from time to time for purposes other than distributions to Certificateholders, such
purposes including without limitation reimbursement to the Company and the Master Servicer
of advances made, or certain expenses incurred, by either of them.
The Agreement permits, with certain exceptions therein provided, the amendment of the
Agreement and the modification of the rights and obligations of the Company, the Master
Servicer and the Trustee and the rights of the Certificateholders under the Agreement at any
time by the Company, the Master Servicer and the Trustee with the consent of the Holders of
Certificates evidencing in the aggregate not less than 66% of the Percentage Interests of
each Class of Certificates affected thereby. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future holders of
this Certificate and of any Certificate issued upon the transfer hereof or in exchange
herefor or in lieu hereof whether or not notation of such consent is made upon the
Certificate. The Agreement also permits the amendment thereof in certain circumstances
without the consent of the Holders of any of the Certificates and, in certain additional
circumstances, without the consent of the Holders of certain Classes of Certificates.
As provided in the Agreement and subject to certain limitations therein set forth,
the transfer of this Certificate is registrable in the Certificate Register upon surrender
of this Certificate for registration of transfer at the offices or agencies appointed by the
Trustee in the City and State of New York, duly endorsed by, or accompanied by an assignment
in the form below or other written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by the Holder hereof or such Holders
attorney duly authorized in writing, and thereupon one or more new Certificates of
authorized denominations evidencing the same Class and aggregate Percentage Interest will be
issued to the designated transferee or transferees.
The Certificates are issuable only as registered Certificates without coupons in
Classes and in denominations specified in the Agreement. As provided in the Agreement and
subject to certain limitations therein set forth, Certificates are exchangeable for new
Certificates of authorized denominations evidencing the same Class and aggregate Percentage
Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer or exchange, but
the Trustee may require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.
The Company, the Master Servicer, the Trustee and the Certificate Registrar and any
agent of the Company, the Master Servicer, the Trustee or the Certificate Registrar may
treat the Person in whose name this Certificate is registered as the owner hereof for all
purposes, and neither the Company, the Master Servicer, the Trustee nor any such agent shall
be affected by notice to the contrary.
This Certificate shall be governed by and construed in accordance with the laws of
the State of New York without regard to the conflicts of laws principals thereof, other than
Sections 5-1401 and 5-1405 of the New York Obligations Law.
The obligations created by the Agreement in respect of the Certificates and the Trust
Fund created thereby shall terminate upon the payment to Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to the
Agreement following the earlier of (i) the maturity or other liquidation of the last
Mortgage Loan subject thereto or the disposition of all property acquired upon foreclosure
or deed in lieu of foreclosure of any Mortgage Loan and (ii) the purchase by the Master
Servicer from the Trust Fund of all remaining Mortgage Loans and all property acquired in
respect of such Mortgage Loans, thereby effecting early retirement of the related
Certificates. The Agreement permits, but does not require, the Master Servicer to (i)
purchase at a price determined as provided in the Agreement all remaining Mortgage Loans and
all property acquired in respect of any Mortgage Loan or (ii) purchase in whole, but not in
part, all of the Certificates from the Holders thereof; provided, that any such option may
only be exercised if the Pool Stated Principal Balance of the Mortgage Loans as of the
Distribution Date upon which the proceeds of any such purchase are distributed is less than
ten percent of the Cut-off Date Principal Balance of the Mortgage Loans.
Reference is hereby made to the further provisions of this Certificate set forth on
the reverse hereof, which further provisions shall for all purposes have the same effect as
if set forth at this place.
Unless the certificate of authentication hereon has been executed by the Certificate
Registrar, by manual signature, this Certificate shall not be entitled to any benefit under
the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly executed.
Dated: December ____, 2005 JPMORGAN CHASE BANK, N.A.
as Trustee
By:_________________________
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class [A- ] Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.,
as Certificate Registrar
By:____________________________
Authorized Signatory
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
(Please print or typewrite name and address including postal zip code of assignee) a
Percentage Interest evidenced by the within Mortgage Asset-Backed Pass-Through Certificate
and hereby authorizes the transfer of registration of such interest to assignee on the
Certificate Register of the Trust Fund.
I (We) further direct the Certificate Registrar to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate to the
following address:
Dated: ___________________________________________
Signature by or on behalf of assignor
__________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately available
funds to _______________________for the account of __________________ account number
______________, or, if mailed by check, to ____________________________. Applicable
statements should be mailed to ________________________.
This information is provided by _____________________, the assignee named above, or
________________, as its agent.
EXHIBIT B
FORM OF CLASS M CERTIFICATES
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE SENIOR CERTIFICATES [AND
THE CLASSM-[ ] CERTIFICATES] DESCRIBED IN THE AGREEMENT (AS DEFINED BELOW).
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A REGULAR INTEREST
IN A REAL ESTATE MORTGAGE INVESTMENT CONDUIT, AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN
SECTIONS860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE CODE).
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (DTC), TO ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN
THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE &
CO., HAS AN INTEREST HEREIN.
ANY TRANSFEREE OF CLASS M CERTIFICATE NOT WILL BE DEEMED TO HAVE REPRESENTED BY
VIRTUE OF ITS PURCHASE OR HOLDING OF SUCH CERTIFICATE (OR ANY INTEREST HEREIN) THAT EITHER
(A) SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN OR OTHER PLAN SUBJECT TO THE PROHIBITED
TRANSACTION PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED
(ERISA), OR SECTION 4975 OF THE CODE (EACH, AN ERISA PLAN), OR ANY PERSON (INCLUDING,
WITHOUT LIMITATION, AN INVESTMENT MANAGER, A NAMED FIDUCIARY OR A TRUSTEE OF ANY ERISA PLAN)
WHO IS USING PLAN ASSETS, WITHIN THE MEANING OF THE U.S. DEPARTMENT OF LABOR REGULATION
PROMULGATED AT 29 C.F.R. 2510.3-101, OF ANY ERISA PLAN (EACH, AN ERISA PLAN INVESTOR) TO
EFFECT SUCH ACQUISITION, OR (B)(I) THE TRANSFEREE IS AN INSURANCE COMPANY, (II) THE SOURCE
OF FUNDS USED TO PURCHASE OR HOLD THE CERTIFICATE (OR ANY INTEREST HEREIN) IS AN INSURANCE
COMPANY GENERAL ACCOUNT (AS DEFINED IN U.S. DEPARTMENT OF LABOR PROHIBITED TRANSACTION
CLASS EXEMPTION (PTCE) 95-60), AND (III) THE CONDITIONS SET FORTH IN SECTIONS I AND III OF
PTCE 95-60 HAVE BEEN SATISFIED (EACH ENTITY THAT SATISFIES THIS CLAUSE (B), A COMPLYING
INSURANCE COMPANY).
IF THIS CERTIFICATE (OR ANY INTEREST HEREIN) IS ACQUIRED OR HELD IN VIOLATION OF THE
PROVISIONS OF THE PRECEDING PARAGRAPH, THEN THE LAST PRECEDING TRANSFEREE THAT EITHER (A) IS
NOT AN ERISA PLAN OR AN ERISA PLAN INVESTOR, OR (B) IS A COMPLYING INSURANCE COMPANY SHALL
BE RESTORED, TO THE EXTENT PERMITTED BY LAW, TO ALL RIGHTS AND OBLIGATIONS AS CERTIFICATE
OWNER THEREOF RETROACTIVE TO THE DATE OF SUCH TRANSFER OF THIS CERTIFICATE. THE TRUSTEE
SHALL BE UNDER NO LIABILITY TO ANY PERSON FOR MAKING ANY PAYMENTS DUE ON THIS CERTIFICATE TO
SUCH PRECEDING TRANSFEREE.
ANY PURPORTED CERTIFICATE OWNER WHOSE ACQUISITION OR HOLDING OF THIS CERTIFICATE (OR
ANY INTEREST HEREIN) WAS EFFECTED IN VIOLATION OF THE RESTRICTIONS IN SECTION 5.02(e) OF THE
POOLING AND SERVICING AGREEMENT SHALL INDEMNIFY AND HOLD HARMLESS THE DEPOSITOR, THE
TRUSTEE, THE MASTER SERVICER, ANY SUBSERVICER, AND THE TRUST FUND FROM AND AGAINST ANY AND
ALL LIABILITIES, CLAIMS, COSTS OR EXPENSES INCURRED BY SUCH PARTIES AS A RESULT OF SUCH
ACQUISITION OR HOLDING.
Certificate No. [____] Adjustable Pass-Through Rate
Class M-___ Mezzanine
Date of Pooling and Servicing Agreement Aggregate Certificate Principal Balance of
and Cut-off Date: the Class M-__ Certificates: $_______________
December 1, 2005
First Distribution Date: Initial Certificate Principal Balance of this
[_____________] Certificate:
$[______________]
Master Servicer:
Residential Funding Corporation
Assumed Final Distribution Date: CUSIP
[_____________] [______________]
MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATE
SERIES 2005-SP3
evidencing a percentage interest in any distributions allocable
to the Class M-___ Certificates with respect to the Trust Fund
consisting primarily of a pool of one- to four-family first and
second lien seasoned mortgage loans sold by RESIDENTIAL ASSET
MORTGAGE PRODUCTS, INC.
This Certificate is payable solely from the assets of the Trust Fund, and does not
represent an obligation of or interest in Residential Asset Mortgage Products, Inc., the
Master Servicer, the Trustee referred to below or GMAC Mortgage Group, Inc. or any of their
affiliates. Neither this Certificate nor the underlying Mortgage Loans are guaranteed or
insured by any governmental agency or instrumentality or by Residential Asset Mortgage
Products, Inc., the Master Servicer, the Trustee or GMAC Mortgage Group, Inc. or any of
their affiliates. None of the Depositor, the Master Servicer, GMAC Mortgage Group, Inc. or
any of their affiliates will have any obligation with respect to any certificate or other
obligation secured by or payable from payments on the Certificates.
This certifies that _______________ is the registered owner of the Percentage
Interest evidenced by this Certificate (obtained by dividing the Certificate Principal
Balance of this Certificate by the aggregate Certificate Principal Balance of all Class
M-___ Certificates, both as specified above) in certain distributions with respect to a
Trust Fund consisting primarily of a pool of one- to four-family first and second lien
seasoned mortgage loans (the Mortgage Loans), formed and sold by Residential Asset
Mortgage Products, Inc. (hereinafter called the Depositor, which term includes any
successor entity under the Agreement referred to below). The Trust Fund was created pursuant
to a Pooling and Servicing Agreement dated as of December 1, 2005, (the Pooling and
Servicing Agreement or the Agreement) among the Depositor, the Master Servicer and
JPMorgan Chase Bank, N.A., as trustee (the Trustee), a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This Certificate
is issued under and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance hereof assents
and by which such Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be made on the 25th day
of each month or, if such 25th day is not a Business Day, the Business Day immediately
following (the Distribution Date), commencing as described in the Agreement, to the Person
in whose name this Certificate is registered at the close of business on the last day (or if
such last day is not a Business Day, the Business Day immediately preceding such last day)
of the month immediately preceding the month of such distribution (the Record Date), from
the related Available Distribution Amount in an amount equal to the product of the
Percentage Interest evidenced by this Certificate and the amount (of interest and principal,
if any) required to be distributed to Holders of Class M-___ Certificates on such
Distribution Date.
Distributions on this Certificate will be made either by the Master Servicer acting
on behalf of the Trustee or by a Paying Agent appointed by the Trustee in immediately
available funds (by wire transfer or otherwise) for the account of the Person entitled
thereto if such Person shall have so notified the Master Servicer or such Paying Agent, or
by check mailed to the address of the Person entitled thereto, as such name and address
shall appear on the Certificate Register.
Notwithstanding the above, the final distribution on this Certificate will be made
after due notice of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the office or agency appointed by the Trustee for that
purpose in the City and State of New York. The Initial Certificate Principal Balance of this
Certificate is set forth above. The Certificate Principal Balance hereof will be reduced to
the extent of the distributions allocable to principal and any Realized Losses allocable
hereto.
As described above, any transferee of this Certificate will be deemed to have
represented by virtue of its purchase or holding of this Certificate (or any interest
herein) that either (a) such transferee is not an ERISA Plan or an ERISA Plan Investor, or
(b) the transferee is a Complying Insurance Company. In addition, any purported Certificate
Owner whose acquisition or holding of this Certificate (or any interest herein) was effected
in violation of the restrictions in Section 5.02(e) of the Agreement shall indemnify and
hold harmless the Depositor, the Trustee, the Master Servicer, any Subservicer, and the
Trust Fund from and against any and all liabilities, claims, costs or expenses incurred by
such parties as a result of such acquisition or holding.
This Certificate is one of a duly authorized issue of Certificates issued in several
Classes designated as Mortgage Asset-Backed Pass-Through Certificates of the Series
specified hereon (herein collectively called the Certificates).
The Certificates are limited in right of payment to certain collections and
recoveries respecting the related Mortgage Loans, all as more specifically set forth herein
and in the Agreement. In the event Master Servicer funds are advanced with respect to any
Mortgage Loan, such advance is reimbursable to the Master Servicer, to the extent provided
in the Agreement, from related recoveries on such Mortgage Loan or from other cash that
would have been distributable to Certificateholders.
As provided in the Agreement, withdrawals from the Custodial Account and/or the
Certificate Account created for the benefit of Certificateholders may be made by the Master
Servicer from time to time for purposes other than distributions to Certificateholders, such
purposes including without limitation reimbursement to the Depositor and the Master Servicer
of advances made, or certain expenses incurred, by either of them.
The Agreement permits, with certain exceptions therein provided, the amendment of the
Agreement and the modification of the rights and obligations of the Depositor, the Master
Servicer and the Trustee and the rights of the Certificateholders under the Agreement at any
time by the Depositor, the Master Servicer and the Trustee with the consent of the Holders
of Certificates evidencing in the aggregate not less than 66% of the Percentage Interests of
each Class of Certificates affected thereby. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future holders of
this Certificate and of any Certificate issued upon the transfer hereof or in exchange
herefor or in lieu hereof whether or not notation of such consent is made upon the
Certificate. The Agreement also permits the amendment thereof in certain circumstances
without the consent of the Holders of any of the Certificates and, in certain additional
circumstances, without the consent of the Holders of certain Classes of Certificates.
As provided in the Agreement and subject to certain limitations therein set forth,
the transfer of this Certificate is registrable in the Certificate Register upon surrender
of this Certificate for registration of transfer at the offices or agencies appointed by the
Trustee in the City and State of New York, duly endorsed by, or accompanied by an assignment
in the form below or other written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by the Holder hereof or such Holders
attorney duly authorized in writing, and thereupon one or more new Certificates of
authorized denominations evidencing the same Class and aggregate Percentage Interest will be
issued to the designated transferee or transferees.
The Certificates are issuable only as registered Certificates without coupons in
Classes and in denominations specified in the Agreement. As provided in the Agreement and
subject to certain limitations therein set forth, Certificates are exchangeable for new
Certificates of authorized denominations evidencing the same Class and aggregate Percentage
Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer or exchange, but
the Trustee may require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.
The Depositor, the Master Servicer, the Trustee and the Certificate Registrar and any
agent of the Depositor, the Master Servicer, the Trustee or the Certificate Registrar may
treat the Person in whose name this Certificate is registered as the owner hereof for all
purposes, and neither the Depositor, the Master Servicer, the Trustee nor any such agent
shall be affected by notice to the contrary.
This Certificate shall be governed by and construed in accordance with the laws of
the State of New York without regard to the conflicts of laws principles thereof, other than
Sections 5-1401 and 5-1405 of the New York Obligations Law.
The obligations created by the Agreement in respect of the Certificates and the Trust
Fund created thereby shall terminate upon the payment to Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to the
Agreement following the earlier of (i) the maturity or other liquidation of the last
Mortgage Loan subject thereto or the disposition of all property acquired upon foreclosure
or deed in lieu of foreclosure of any Mortgage Loan and (ii) the purchase by the Master
Servicer from the Trust Fund of all remaining Mortgage Loans and all property acquired in
respect of such Mortgage Loans, thereby effecting early retirement of the related
Certificates. The Agreement permits, but does not require, the Master Servicer to (i)
purchase at a price determined as provided in the Agreement all remaining Mortgage Loans and
all property acquired in respect of any Mortgage Loan or (ii) purchase in whole, but not in
part, all of the Certificates from the Holders thereof; provided, that any such option may
only be exercised if the aggregate Stated Principal Balance of the Mortgage Loans as of the
Distribution Date upon which the proceeds of any such purchase are distributed is less than
ten percent of the Cut-off Date Principal Balance of the Mortgage Loans.
Unless the certificate of authentication hereon has been executed by the Certificate
Registrar, by manual signature, this Certificate shall not be entitled to any benefit under
the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly executed.
Dated: December ____, 2005 JPMORGAN CHASE BANK, N.A.
as Trustee
By:_________________________
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class [A- ] Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.,
as Certificate Registrar
By:____________________________
Authorized Signatory
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
(Please print or typewrite name and address including postal zip code of assignee) a
Percentage Interest evidenced by the within Mortgage Asset-Backed Pass-Through Certificate
and hereby authorizes the transfer of registration of such interest to assignee on the
Certificate Register of the Trust Fund.
I (We) further direct the Certificate Registrar to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate to the
following address:
Dated: ___________________________________________
Signature by or on behalf of assignor
__________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately available
funds to _______________________for the account of __________________ account number
______________, or, if mailed by check, to ____________________________. Applicable
statements should be mailed to ________________________.
This information is provided by _____________________, the assignee named above, or
________________, as its agent.
EXHIBIT C
FORM OF CLASS B CERTIFICATES
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE SENIOR CERTIFICATES AND
THE CLASS M CERTIFICATES, AS DESCRIBED IN THE AGREEMENT (AS DEFINED BELOW).
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A REGULAR INTEREST
IN A REAL ESTATE MORTGAGE INVESTMENT CONDUIT, AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN
SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE CODE).
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE RESOLD OR TRANSFERRED
UNLESS IT IS REGISTERED PURSUANT TO SUCH ACT AND LAWS OR IS SOLD OR TRANSFERRED IN
TRANSACTIONS WHICH ARE EXEMPT FROM REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE
LAW AND IS TRANSFERRED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND
SERVICING AGREEMENT (THE AGREEMENT).
NO TRANSFER OF THIS CERTIFICATE (OR ANY INTEREST THEREIN) MAY BE MADE TO ANY PERSON,
UNLESS THE TRANSFEREE PROVIDES THE TRUSTEE, THE DEPOSITOR AND THE MASTER SERVICER WITH
EITHER (A) A CERTIFICATION PURSUANT TO SECTION 5.02(e) OF THE AGREEMENT OR (B) AN OPINION OF
COUNSEL ACCEPTABLE TO AND IN FORM AND SUBSTANCE SATISFACTORY TO THE TRUSTEE, THE DEPOSITOR
AND THE MASTER SERVICER TO THE EFFECT THAT THE PURCHASE AND HOLDING OF THIS CERTIFICATE IS
PERMISSIBLE UNDER APPLICABLE LAW, WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED
TRANSACTION UNDER SECTION 406 OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED (ERISA), OR SECTION 4975 OF THE CODE (OR COMPARABLE PROVISIONS OF ANY SUBSEQUENT
ENACTMENTS) AND WILL NOT SUBJECT THE TRUSTEE, THE DEPOSITOR OR THE MASTER SERVICER TO ANY
OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS AND LIABILITIES UNDER ERISA OR SECTION 4975
OF THE CODE) IN ADDITION TO THOSE UNDERTAKEN IN THE AGREEMENT, WHICH OPINION OF COUNSEL
SHALL NOT BE AN EXPENSE OF THE TRUSTEE, THE DEPOSITOR OR THE MASTER SERVICER.
Class B Certificate No.[__]
Date of Pooling and Servicing Adjustable Rate
Agreement and Cut-off Date
December 1, 2005
First Distribution Date:
[_________]
Master Servicer: Aggregate Certificate Principal Balance of
Residential Funding Corporation this
Certificate: $[______________________]
Final Scheduled Distribution Date: Initial Certificate Principal Balance of this
[_________________] Certificate: $[______________________]
CUSIP: [_______________]
MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATES
SERIES 2005-SP3
evidencing a percentage interest in the distributions allocable
to the Class B Certificates with respect to a Trust Fund
consisting primarily of a pool of one- to four-family first and
second lien seasoned mortgage loans sold by RESIDENTIAL ASSET
MORTGAGE PRODUCTS, INC.
This Certificate is payable solely from the assets of the Trust Fund, and does not
represent an obligation of or interest in Residential Asset Mortgage Products, Inc., the
Master Servicer, the Trustee referred to below or GMAC Mortgage Group, Inc. or any of their
affiliates. Neither this Certificate nor the underlying Mortgage Loans are guaranteed or
insured by any governmental agency or instrumentality or by Residential Asset Mortgage
Products, Inc., the Master Servicer, the Trustee or GMAC Mortgage Group, Inc. or any of
their affiliates. None of the Depositor, the Master Servicer, GMAC Mortgage Group, Inc. or
any of their affiliates will have any obligation with respect to any certificate or other
obligation secured by or payable from payments on the Certificates.
This certifies that _________________ is the registered owner of the Percentage
Interest evidenced by this Certificate in certain distributions with respect to the Trust
Fund consisting primarily of an interest in a pool of one- to four-family first and second
lien seasoned mortgage loans (the Mortgage Loans), sold by Residential Asset Mortgage
Products, Inc. (hereinafter called the Depositor, which term includes any successor entity
under the Agreement referred to below). The Trust Fund was created pursuant to a Pooling
and Servicing Agreement dated as specified above (the Agreement) among the Depositor, the
Master Servicer and JPMorgan Chase Bank, N.A., as trustee (the Trustee), a summary of
certain of the pertinent provisions of which is set forth hereafter. To the extent not
defined herein, the capitalized terms used herein have the meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate by virtue of
the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be made on the 25th day
of each month or, if such 25th day is not a Business Day, the Business Day immediately
following (the Distribution Date), commencing as described in the Agreement, to the Person
in whose name this Certificate is registered at the close of business on the last day (or if
such last day is not a Business Day, the Business Day immediately preceding such last day)
of the month immediately preceding the month of such distribution (the Record Date), from
the related Available Distribution Amount in an amount equal to the product of the
Percentage Interest evidenced by this Certificate and the amount of interest and principal,
if any, required to be distributed to Holders of Class B Certificates on such Distribution
Date.
Distributions on this Certificate will be made either by the Master Servicer acting
on behalf of the Trustee or by a Paying Agent appointed by the Trustee in immediately
available funds (by wire transfer or otherwise) for the account of the Person entitled
thereto if such Person shall have so notified the Master Servicer or such Paying Agent, or
by check mailed to the address of the Person entitled thereto, as such name and address
shall appear on the Certificate Register.
Notwithstanding the above, the final distribution on this Certificate will be made
after due notice of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the office or agency appointed by the Trustee for that
purpose in the City and State of New York. The Initial Certificate Principal Balance of
this Certificate is set forth above. The Certificate Principal Balance hereof will be
reduced to the extent of the distributions allocable to principal and any Realized Losses
allocable hereto.
No transfer of this Class B Certificate will be made unless such transfer is exempt
from the registration requirements of the Securities Act of 1933, as amended, and any
applicable state securities laws or is made in accordance with said Act and laws. In the
event that such a transfer is to be made, (i) the Trustee or the Depositor may require an
opinion of counsel acceptable to and in form and substance satisfactory to the Trustee and
the Depositor that such transfer is exempt (describing the applicable exemption and the
basis therefor) from or is being made pursuant to the registration requirements of the
Securities Act of 1933, as amended, and of any applicable statute of any state and (ii) the
transferee shall execute an investment letter in the form described by the Agreement. The
Holder hereof desiring to effect such transfer shall, and does hereby agree to, indemnify
the Trustee, the Depositor, the Master Servicer and the Certificate Registrar acting on
behalf of the Trustee against any liability that may result if the transfer is not so exempt
or is not made in accordance with such Federal and state laws.
As described above, no transfer of this Certificate (or any interest therein) shall
be made unless the transferee provides the Trustee, the Depositor and the Master Servicer
with either (a) a certification pursuant to Section 5.02(e) of the Agreement stating that
either (i) the transferee is not an employee benefit or other plan subject to the prohibited
transaction provisions of ERISA or Section 4975 of the Code (each, an ERISA Plan), or any
Person (including an insurance company investing its general accounts, an investment
manager, a named fiduciary or a trustee of any ERISA Plan) who is using plan assets,
within the meaning of the U.S. Department of Labor regulation promulgated at 29 C.F.R.
2510.3-101, of any ERISA Plan (each, an ERISA Plan Investor) to effect such acquisition or
(ii) the transferee is an insurance company, the source of funds used to purchase or hold
such Certificate (or any interest therein) is an insurance company general account (as
defined in U.S. Department of Labor Prohibited Transaction Class Exemption (PTCE) 95-60
and the conditions set forth in Sections I and III of PTCE 95-60 have been satisfied, or (b)
an opinion of counsel acceptable to and in form and substance satisfactory to the Trustee,
the Depositor and the Master Servicer to the effect that the purchase and holding of this
Certificate is permissible under applicable law, will not constitute or result in a
non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code (or
comparable provisions of any subsequent enactments), and will not subject the Trustee, the
Depositor or the Master Servicer to any obligation or liability (including obligations or
liabilities under ERISA or Section 4975 of the Code) in addition to those undertaken in the
Agreement, which opinion of counsel shall not be an expense of the Trustee, the Depositor or
the Master Servicer.
This Certificate is one of a duly authorized issue of Certificates issued in several
Classes designated as Mortgage Asset-Backed Pass-Through Certificates of the Series
specified hereon (herein collectively called the Certificates).
The Certificates are limited in right of payment to certain collections and
recoveries respecting the Mortgage Loans, all as more specifically set forth herein and in
the Agreement. In the event Master Servicer funds are advanced with respect to any Mortgage
Loan, such advance is reimbursable to the Master Servicer, to the extent provided in the
Agreement, from related recoveries on such Mortgage Loan or from other cash that would have
been distributable to Certificateholders.
As provided in the Agreement, withdrawals from the Custodial Account and/or the
Certificate Account created for the benefit of Certificateholders may be made by the Master
Servicer from time to time for purposes other than distributions to Certificateholders, such
purposes including without limitation reimbursement to the Depositor and the Master Servicer
of advances made, or certain expenses incurred, by either of them.
The Agreement permits, with certain exceptions therein provided, the amendment of the
Agreement and the modification of the rights and obligations of the Depositor, the Master
Servicer and the Trustee and the rights of the Certificateholders under the Agreement at any
time by the Depositor, the Master Servicer and the Trustee with the consent of the Holders
of Certificates evidencing in the aggregate not less than 66% of the Percentage Interests of
each Class of Certificates affected thereby. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future holders of
this Certificate and of any Certificate issued upon the transfer hereof or in exchange
herefor or in lieu hereof whether or not notation of such consent is made upon the
Certificate. The Agreement also permits the amendment thereof in certain circumstances
without the consent of the Holders of any of the Certificates and, in certain additional
circumstances, without the consent of the Holders of certain Classes of Certificates.
As provided in the Agreement and subject to certain limitations therein set forth,
the transfer of this Certificate is registrable in the Certificate Register upon surrender
of this Certificate for registration of transfer at the offices or agencies appointed by the
Trustee in the City and State of New York, duly endorsed by, or accompanied by an assignment
in the form below or other written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by the Holder hereof or such Holders
attorney duly authorized in writing, and thereupon one or more new Certificates of
authorized denominations evidencing the same Class and aggregate Percentage Interest will be
issued to the designated transferee or transferees.
The Certificates are issuable only as registered Certificates without coupons in
Classes and in denominations specified in the Agreement. As provided in the Agreement and
subject to certain limitations therein set forth, Certificates are exchangeable for new
Certificates of authorized denominations evidencing the same Class and aggregate Percentage
Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer or exchange, but
the Trustee may require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.
The Depositor, the Master Servicer, the Trustee and the Certificate Registrar and any
agent of the Depositor, the Master Servicer, the Trustee or the Certificate Registrar may
treat the Person in whose name this Certificate is registered as the owner hereof for all
purposes, and neither the Depositor, the Master Servicer, the Trustee nor any such agent
shall be affected by notice to the contrary.
This Certificate shall be governed by and construed in accordance with the laws of
the State of New York without regard to the conflicts of laws principles thereof, other than
Sections 5-1401 and 5-1405 of the New York Obligations Law.
The obligations created by the Agreement in respect of the Certificates and the Trust
Fund created thereby shall terminate upon the payment to Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to the
Agreement following the earlier of (i) the maturity or other liquidation of the last
Mortgage Loan subject thereto or the disposition of all property acquired upon foreclosure
or deed in lieu of foreclosure of any Mortgage Loan, and (ii) the purchase by the Master
Servicer or its designee from the Trust Fund of all remaining Mortgage Loans and all
property acquired in respect of such Mortgage Loans, thereby effecting early retirement of
the related Certificates. The Agreement permits, but does not require, the Master Servicer
or its designee (i) to purchase, at a price determined as provided in the Agreement, all
remaining Mortgage Loans and all property acquired in respect of any Mortgage Loan or (ii)
subject to the terms of the Agreement, to purchase in whole, but not in part, all of the
Certificates from the Holders thereof, provided, that any such option may only be exercised
if the aggregate Stated Principal Balance of the Mortgage Loans, as of the Distribution Date
upon which the proceeds of any such purchase are distributed is less than ten percent of the
Cut-off Date Principal Balance of the Mortgage Loans.
Unless the certificate of authentication hereon has been executed by the Certificate
Registrar by manual signature, this Certificate shall not be entitled to any benefit under
the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly executed.
Dated: December ____, 2005 JPMORGAN CHASE BANK, N.A.
as Trustee
By:_________________________
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class [A- ] Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.,
as Certificate Registrar
By:____________________________
Authorized Signatory
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
(Please print or typewrite name and address including postal zip code of assignee) a
Percentage Interest evidenced by the within Mortgage Asset-Backed Pass-Through Certificate
and hereby authorizes the transfer of registration of such interest to assignee on the
Certificate Register of the Trust Fund.
I (We) further direct the Certificate Registrar to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate to the
following address:
Dated: ___________________________________________
Signature by or on behalf of assignor
__________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately available
funds to _______________________for the account of __________________ account number
______________, or, if mailed by check, to ____________________________. Applicable
statements should be mailed to ________________________.
This information is provided by _____________________, the assignee named above, or
________________, as its agent.
EXHIBIT D
FORM OF CLASS SB CERTIFICATE
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A CERTIFICATES,
CLASS M CERTIFICATES AND CLASS B CERTIFICATES AS DESCRIBED IN THE AGREEMENT (AS DEFINED
HEREIN).
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A REGULAR INTEREST
IN A REAL ESTATE MORTGAGE INVESTMENT CONDUIT, AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN
SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE RESOLD OR TRANSFERRED
UNLESS IT IS REGISTERED PURSUANT TO SUCH ACT AND LAWS OR IS SOLD OR TRANSFERRED IN
TRANSACTIONS WHICH ARE EXEMPT FROM REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE
LAW AND IS TRANSFERRED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND
SERVICING AGREEMENT (THE AGREEMENT).
NO TRANSFER OF THIS CERTIFICATE (OR ANY INTEREST HEREIN) MAY BE MADE TO ANY PERSON,
UNLESS THE TRANSFEREE PROVIDES THE TRUSTEE, THE DEPOSITOR AND THE MASTER SERVICER WITH
EITHER (A) A CERTIFICATION PURSUANT TO SECTION 5.02(e) OF THE AGREEMENT OR (B) AN OPINION OF
COUNSEL ACCEPTABLE TO AND IN FORM AND SUBSTANCE SATISFACTORY TO THE MASTER SERVICER, THE
DEPOSITOR AND THE TRUSTEE TO THE EFFECT THAT THE PURCHASE AND HOLDING OF THIS CERTIFICATE IS
PERMISSIBLE UNDER APPLICABLE LAW, WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED
TRANSACTION UNDER SECTION 406 OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED (ERISA), OR SECTION 4975 OF THE CODE (OR COMPARABLE PROVISIONS OF ANY SUBSEQUENT
ENACTMENTS) AND WILL NOT SUBJECT THE MASTER SERVICER, THE DEPOSITOR OR THE TRUSTEE TO ANY
OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR LIABILITIES UNDER ERISA OR SECTION 4975 OF
THE CODE) IN ADDITION TO THOSE UNDERTAKEN IN THE AGREEMENT, WHICH OPINION OF COUNSEL SHALL
NOT BE AN EXPENSE OF THE TRUSTEE, THE DEPOSITOR OR THE MASTER SERVICER.
Certificate No. [___]
Class SB Subordinate
Date of Pooling and Servicing Percentage Interest: [___]%
Agreement and Cut-off Date:
December 1, 2005
First Distribution Date: Aggregate Initial Certificate Principal
[_____________] Balance
of the Class SB Certificate: $[_________]
Master Servicer: Initial Certificate Principal Balance of this
Residential Funding Corporation Certificate: $[__________]
Final Scheduled Distribution Date: CUSIP: [_____________]
[___________]
MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATES
SERIES 2005-SP3
evidencing a percentage interest in any distributions allocable
to the Class SB Certificates with respect to the Trust Fund
consisting primarily of a pool of one- to four-family first and
second lien seasoned mortgage loans sold by RESIDENTIAL ASSET
MORTGAGE PRODUCTS, INC.
This Certificate is payable solely from the assets of the Trust Fund, and does not
represent an obligation of or interest in Residential Asset Mortgage Products, Inc., the
Master Servicer, the Trustee referred to below, GMAC Mortgage Group, Inc. or any of their
affiliates. Neither this Certificate nor the underlying Mortgage Loans are guaranteed or
insured by any governmental agency or instrumentality or by Residential Asset Mortgage
Products, Inc., the Master Servicer, the Trustee, GMAC Mortgage Group, Inc. or any of their
affiliates. None of Residential Asset Mortgage Products, Inc., the Master Servicer, GMAC
Mortgage Group, Inc. or any of their affiliates will have any obligation with respect to any
certificate or other obligation secured by or payable from payments on the Certificates.
This certifies that [_______________] is the registered owner of the Percentage
Interest evidenced by this Certificate in certain distributions with respect to the Trust
Fund consisting primarily of an interest in a pool of one- to four-family first and second
lien seasoned mortgage loans (the Mortgage Loans), sold by Residential Asset Mortgage
Products, Inc. (hereinafter called the Depositor, which term includes any successor entity
under the Agreement referred to below). The Trust Fund was created pursuant to a Pooling
and Servicing Agreement dated as specified above (the Agreement) among the Depositor, the
Master Servicer and JPMorgan Chase Bank, N.A., as trustee (the Trustee), a summary of
certain of the pertinent provisions of which is set forth hereafter. To the extent not
defined herein, the capitalized terms used herein have the meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate by virtue of
the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be made on the 25th day
of each month or, if such 25th day is not a Business Day, the Business Day immediately
following (the Distribution Date), commencing as described in the Agreement, to the Person
in whose name this Certificate is registered at the close of business on the last day (or if
such last day is not a Business Day, the Business Day immediately preceding such last day)
of the month immediately preceding the month of such distribution (the Record Date), from
the related Available Distribution Amount in an amount equal to the product of the
Percentage Interest evidenced by this Certificate and the amount of interest and principal,
if any, required to be distributed to Holders of Class SB Certificates on such Distribution
Date.
Distributions on this Certificate will be made either by the Master Servicer acting
on behalf of the Trustee or by a Paying Agent appointed by the Trustee in immediately
available funds (by wire transfer or otherwise) for the account of the Person entitled
thereto if such Person shall have so notified the Master Servicer or such Paying Agent, or
by check mailed to the address of the Person entitled thereto, as such name and address
shall appear on the Certificate Register.
Notwithstanding the above, the final distribution on this Certificate will be made
after due notice of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the office or agency appointed by the Trustee for that
purpose in the City and State of New York. The Notional Amount of this Class SB Certificate
as of any date of determination will be calculated as described in the Agreement. The
Notional Amount hereof will be reduced by interest shortfalls on the Mortgage Loans
including any Prepayment Interest Shortfalls not covered by Eligible Master Servicing
Compensation or Excess Cash Flow, and the interest portion of any Realized Losses incurred
in respect thereof. This Class SB Certificate will accrue interest at the Pass-Through Rate
on the Notional Amount as indicated in the definition of Accrued Certificate Interest in the
Agreement. This Class SB Certificate will not accrue interest on its Certificate Principal
Balance.
No transfer of this Class SB Certificate will be made unless such transfer is exempt
from the registration requirements of the Securities Act of 1933, as amended, and any
applicable state securities laws or is made in accordance with said Act and laws. In the
event that such a transfer is to be made, (i) the Trustee or the Depositor may require an
opinion of counsel acceptable to and in form and substance satisfactory to the Trustee and
the Depositor that such transfer is exempt (describing the applicable exemption and the
basis therefor) from or is being made pursuant to the registration requirements of the
Securities Act of 1933, as amended, and of any applicable statute of any state and (ii) the
transferee shall execute an investment letter in the form described by the Agreement. The
Holder hereof desiring to effect such transfer shall, and does hereby agree to, indemnify
the Trustee, the Depositor, the Master Servicer and the Certificate Registrar acting on
behalf of the Trustee against any liability that may result if the transfer is not so exempt
or is not made in accordance with such Federal and state laws.
As described above, no transfer of this Certificate (or any interest therein) shall
be made unless the transferee provides the Trustee, the Depositor and the Master Servicer
with either (a) a certification pursuant to Section 5.02(e) of the Agreement stating that
the transferee is not an employee benefit or other plan subject to the prohibited
transaction provisions of ERISA or Section 4975 of the Code (each, an ERISA Plan), or any
Person (including an insurance company investing its general accounts, an investment
manager, a named fiduciary or a trustee of any ERISA Plan) who is using plan assets,
within the meaning of the U.S. Department of Labor regulation promulgated at 29 C.F.R.
2510.3-101, of any ERISA Plan (each, an ERISA Plan Investor) to effect such acquisition,
or (b) an opinion of counsel acceptable to and in form and substance satisfactory to the
Trustee, the Depositor and the Master Servicer to the effect that the purchase and holding
of this Certificate is permissible under applicable law, will not constitute or result in a
non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code (or
comparable provisions of any subsequent enactments), and will not subject the Trustee, the
Depositor or the Master Servicer to any obligation or liability (including obligations or
liabilities under ERISA or Section 4975 of the Code) in addition to those undertaken in the
Agreement, which opinion of counsel shall not be an expense of the Trustee, the Depositor or
the Master Servicer.
This Certificate is one of a duly authorized issue of Certificates issued in several
Classes designated as Mortgage Asset-Backed Pass-Through Certificates of the Series
specified in the Agreement (herein collectively called the Certificates).
The Certificates are limited in right of payment to certain collections and
recoveries respecting the Mortgage Loans, all as more specifically set forth herein and in
the Agreement. In the event Master Servicer funds are advanced with respect to any Mortgage
Loan, such advance is reimbursable to the Master Servicer, to the extent provided in the
Agreement, from related recoveries on such Mortgage Loan or from other cash that would have
been distributable to Certificateholders.
As provided in the Agreement, withdrawals from the Custodial Account and/or the
Certificate Account created for the benefit of Certificateholders may be made by the Master
Servicer from time to time for purposes other than distributions to Certificateholders, such
purposes including without limitation reimbursement to the Depositor and the Master Servicer
of advances made, or certain expenses incurred, by either of them.
The Agreement permits, with certain exceptions therein provided, the amendment of the
Agreement and the modification of the rights and obligations of the Depositor, the Master
Servicer and the Trustee and the rights of the Certificateholders under the Agreement at any
time by the Depositor, the Master Servicer and the Trustee with the consent of the Holders
of Certificates evidencing in the aggregate not less than 66% of the Percentage Interests of
each Class of Certificates affected thereby. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future holders of
this Certificate and of any Certificate issued upon the transfer hereof or in exchange
herefor or in lieu hereof whether or not notation of such consent is made upon the
Certificate. The Agreement also permits the amendment thereof in certain circumstances
without the consent of the Holders of any of the Certificates and, in certain additional
circumstances, without the consent of the Holders of certain Classes of Certificates.
As provided in the Agreement and subject to certain limitations therein set forth,
the transfer of this Certificate is registrable in the Certificate Register upon surrender
of this Certificate for registration of transfer at the offices or agencies appointed by the
Trustee in the City and State of New York, duly endorsed by, or accompanied by an assignment
in the form below or other written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by the Holder hereof or such Holders
attorney duly authorized in writing, and thereupon one or more new Certificates of
authorized denominations evidencing the same Class and aggregate Percentage Interest will be
issued to the designated transferee or transferees.
The Certificates are issuable only as registered Certificates without coupons in
Classes and in denominations specified in the Agreement. As provided in the Agreement and
subject to certain limitations therein set forth, Certificates are exchangeable for new
Certificates of authorized denominations evidencing the same Class and aggregate Percentage
Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer or exchange, but
the Trustee may require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.
The Depositor, the Master Servicer, the Trustee, the Certificate Registrar and any
agent of the Depositor, the Master Servicer, the Trustee or the Certificate Registrar may
treat the Person in whose name this Certificate is registered as the owner hereof for all
purposes, and neither the Depositor, the Master Servicer, the Trustee nor any such agent
shall be affected by notice to the contrary.
This Certificate shall be governed by and construed in accordance with the laws of
the State of New York.
The obligations created by the Agreement in respect of the Certificates and the Trust
Fund created thereby shall terminate upon the payment to Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to the
Agreement following the earlier of (i) the maturity or other liquidation of the last
Mortgage Loan subject thereto or the disposition of all property acquired upon foreclosure
or deed in lieu of foreclosure of any Mortgage Loan, and (ii) the purchase by the Master
Servicer or its designee from the Trust Fund of all remaining Mortgage Loans and all
property acquired in respect of such Mortgage Loans, thereby effecting early retirement of
the related Certificates. The Agreement permits, but does not require, the Master Servicer
or its designee (i) to purchase at a price determined as provided in the Agreement all
remaining Mortgage Loans and all property acquired in respect of any Mortgage Loan or (ii)
subject to the terms of the Agreement, to purchase in whole, but not in part, all of the
Certificates Group from the Holders thereof; provided, that any such option may only be
exercised if the pool Stated Principal Balance of the related Mortgage Loans as of the
Distribution Date upon which the proceeds of any such purchase are distributed is less than
ten percent of the Cut-off Date Principal Balance of the Mortgage Loans.
Reference is hereby made to the further provisions of this Certificate set forth on
the reverse hereof, which further provisions shall for all purposes have the same effect as
if set forth at this place.
Unless the certificate of authentication hereon has been executed by the Certificate
Registrar, by manual signature, this Certificate shall not be entitled to any benefit under
the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly executed.
Dated: December ____, 2005 JPMORGAN CHASE BANK, N.A.
as Trustee
By:_________________________
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class [A- ] Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.,
as Certificate Registrar
By:____________________________
Authorized Signatory
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
(Please print or typewrite name and address including postal zip code of assignee) a
Percentage Interest evidenced by the within Mortgage Asset-Backed Pass-Through Certificate
and hereby authorizes the transfer of registration of such interest to assignee on the
Certificate Register of the Trust Fund.
I (We) further direct the Certificate Registrar to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate to the
following address:
Dated: ___________________________________________
Signature by or on behalf of assignor
__________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately available
funds to _______________________for the account of __________________ account number
______________, or, if mailed by check, to ____________________________. Applicable
statements should be mailed to ________________________.
This information is provided by _____________________, the assignee named above, or
________________, as its agent.
EXHIBIT E
FORM OF CLASS R CERTIFICATE
THIS CERTIFICATE MAY NOT BE HELD BY OR TRANSFERRED TO A NON- UNITED STATES PERSON OR
A DISQUALIFIED ORGANIZATION (AS DEFINED BELOW).
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A RESIDUAL
INTEREST IN A REAL ESTATE MORTGAGE INVESTMENT CONDUIT AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED
(THE CODE). THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE RESOLD OR
TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO SUCH ACT AND LAWS OR IS SOLD OR TRANSFERRED
IN TRANSACTIONS WHICH ARE EXEMPT FROM REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE
LAW AND IS TRANSFERRED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND
SERVICING AGREEMENT (THE AGREEMENT).
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE RESOLD OR TRANSFERRED
UNLESS IT IS REGISTERED PURSUANT TO SUCH ACT AND LAWS OR IS SOLD OR TRANSFERRED IN
TRANSACTIONS WHICH ARE EXEMPT FROM REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE
LAW AND IS TRANSFERRED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE AGREEMENT.
NO TRANSFER OF THIS CERTIFICATE (OR ANY INTEREST THEREIN) MAY BE MADE TO ANY PERSON,
UNLESS THE TRANSFEREE PROVIDES THE TRUSTEE, THE DEPOSITOR AND THE MASTER SERVICER WITH
EITHER (A) A CERTIFICATION PURSUANT TO SECTION 5.02(e) OF THE AGREEMENT OR (B) AN OPINION OF
COUNSEL ACCEPTABLE TO AND IN FORM AND SUBSTANCE SATISFACTORY TO THE TRUSTEE, THE DEPOSITOR
AND THE MASTER SERVICER TO THE EFFECT THAT THE PURCHASE AND HOLDING OF THIS CERTIFICATE IS
PERMISSIBLE UNDER APPLICABLE LAW, WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED
TRANSACTION UNDER SECTION 406 OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED (ERISA), OR SECTION 4975 OF THE CODE (OR COMPARABLE PROVISIONS OF ANY SUBSEQUENT
ENACTMENTS) AND WILL NOT SUBJECT THE TRUSTEE, THE DEPOSITOR OR THE MASTER SERVICER TO ANY
OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS AND LIABILITIES UNDER ERISA OR SECTION 4975
OF THE CODE) IN ADDITION TO THOSE UNDERTAKEN IN THE AGREEMENT, WHICH OPINION OF COUNSEL
SHALL NOT BE AN EXPENSE OF THE TRUSTEE, THE DEPOSITOR OR THE MASTER SERVICER.
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY IF THE
PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE MASTER SERVICER AND THE TRUSTEE
THAT (1) SUCH TRANSFEREE IS NOT (A) THE UNITED STATES, ANY STATE OR POLITICAL SUBDIVISION
THEREOF, ANY POSSESSION OF THE UNITED STATES, OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF THE
FOREGOING (OTHER THAN AN INSTRUMENTALITY WHICH IS A CORPORATION IF ALL OF ITS ACTIVITIES ARE
SUBJECT TO TAX AND EXCEPT FOR ▇▇▇▇▇▇▇ MAC, A MAJORITY OF ITS BOARD OF DIRECTORS IS NOT
SELECTED BY SUCH GOVERNMENTAL UNIT), (B) A FOREIGN GOVERNMENT, ANY INTERNATIONAL
ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY OF EITHER OF THE FOREGOING, (C) ANY
ORGANIZATION (OTHER THAN CERTAIN FARMERS COOPERATIVES DESCRIBED IN SECTION 521 OF THE CODE)
WHICH IS EXEMPT FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE UNLESS SUCH ORGANIZATION IS
SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE CODE (INCLUDING THE TAX IMPOSED BY SECTION
511 OF THE CODE ON UNRELATED BUSINESS TAXABLE INCOME), (D) RURAL ELECTRIC AND TELEPHONE
COOPERATIVES DESCRIBED IN SECTION 1381(A)(2)(C) OF THE CODE, (E) AN ELECTING LARGE
PARTNERSHIP UNDER SECTION 775(A) OF THE CODE (ANY SUCH PERSON DESCRIBED IN THE FOREGOING
CLAUSES (A), (B), (C), (D) OR (E) BEING HEREIN REFERRED TO AS A DISQUALIFIED
ORGANIZATION), OR (F) AN AGENT OF A DISQUALIFIED ORGANIZATION, (2) NO PURPOSE OF SUCH
TRANSFER IS TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX AND (3) SUCH TRANSFEREE SATISFIES
CERTAIN ADDITIONAL CONDITIONS RELATING TO THE FINANCIAL CONDITION OF THE PROPOSED
TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE REGISTER OR ANY TRANSFER,
SALE OR OTHER DISPOSITION OF THIS CERTIFICATE TO A DISQUALIFIED ORGANIZATION OR AN AGENT OF
A DISQUALIFIED ORGANIZATION, SUCH REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR
EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER FOR ANY
PURPOSE HEREUNDER, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS
CERTIFICATE. EACH HOLDER OF THIS CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE SHALL BE
DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF THIS PARAGRAPH.
Class R-[___] Residual Certificate No. [____]
Date of Pooling and Servicing Agreement Aggregate Initial Certificate Principal
and Cut-off Date: Balance of the Class R-___ Certificates:
December 1, 2005 $[______________]
First Distribution Date: Initial Certificate Principal Balance of this
[__________] Certificate:
$[______________]
Master Servicer: Percentage Interest: _____%
Residential Funding Corporation
Assumed Final Distribution Date: CUSIP
[________________] [______________]
MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATE
SERIES 2005-SP3
evidencing a percentage interest in any distributions allocable
to the Class R-__ Certificates with respect to the Trust Fund
consisting primarily of a pool of one- to four-family first and
second lien seasoned mortgage loans sold by RESIDENTIAL ASSET
MORTGAGE PRODUCTS, INC.
This Certificate is payable solely from the assets of the Trust Fund and does not
represent an obligation of or interest in Residential Asset Mortgage Products, Inc., the
Master Servicer, the Trustee referred to below or GMAC Mortgage Group, Inc. or any of their
affiliates. Neither this Certificate nor the underlying Mortgage Loans are guaranteed or
insured by any governmental agency or instrumentality or by Residential Asset Mortgage
Products, Inc., the Master Servicer, the Trustee or GMAC Mortgage Group, Inc. or any of
their affiliates. None of the Depositor, the Master Servicer, GMAC Mortgage Group, Inc. or
any of their affiliates will have any obligation with respect to any certificate or other
obligation secured by or payable from payments on the Certificates.
This certifies that ___________________ is the registered owner of the Percentage
Interest evidenced by this Certificate (obtained by dividing the Initial Certificate
Principal Balance of this Certificate by the aggregate Initial Certificate Principal Balance
of all Class R-__ Certificates, both as specified above) in certain distributions with
respect to the Trust Fund consisting primarily of a pool of one- to four-family first and
second lien seasoned mortgage loans (the Mortgage Loans), sold by Residential Asset
Mortgage Products, Inc. (hereinafter called the Depositor, which term includes any
successor entity under the Agreement referred to below). The Trust Fund was created
pursuant to a Pooling and Servicing Agreement dated as of December 1, 2005, (the Pooling
and Servicing Agreement or the Agreement) among the Depositor, the Master Servicer and
JPMorgan Chase Bank, N.A., as trustee (the Trustee), a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This Certificate
is issued under and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance hereof assents
and by which such Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be made on the 25th day
of each month or, if such 25th day is not a Business Day, the Business Day immediately
following (the Distribution Date), commencing as described in the Agreement, to the Person
in whose name this Certificate is registered at the close of business on the last day (or if
such last day is not a Business Day, the Business Day immediately preceding such last day)
of the month immediately preceding the month of such distribution (the Record Date), from
the Available Distribution Amount in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount (of interest and principal, if any)
required to be distributed to Holders of Class R-__ Certificates on such Distribution Date.
Each Holder of this Certificate will be deemed to have agreed to be bound by the
restrictions set forth in the Agreement to the effect that (i) each person holding or
acquiring any Ownership Interest in this Certificate must be a United States Person and a
Permitted Transferee, (ii) the transfer of any Ownership Interest in this Certificate will
be conditioned upon the delivery to the Trustee of, among other things, an affidavit to the
effect that it is a United States Person and Permitted Transferee, (iii) any attempted or
purported transfer of any Ownership Interest in this Certificate in violation of such
restrictions will be absolutely null and void and will vest no rights in the purported
transferee, and (iv) if any person other than a United States Person and a Permitted
Transferee acquires any Ownership Interest in this Certificate in violation of such
restrictions, then the Depositor will have the right, in its sole discretion and without
notice to the Holder of this Certificate, to sell this Certificate to a purchaser selected
by the Depositor, which purchaser may be the Depositor, or any affiliate of the Depositor,
on such terms and conditions as the Depositor may choose.
Notwithstanding the above, the final distribution on this Certificate will be made
after due notice of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the office or agency appointed by the Trustee for that
purpose in the City and State of New York. The Initial Certificate Principal Balance of
this Certificate is set forth above. The Certificate Principal Balance hereof will be
reduced to the extent of distributions allocable to principal and any Realized Losses
allocable hereto. Notwithstanding the reduction of the Certificate Principal Balance hereof
to zero, this Certificate will remain outstanding under the Agreement and the Holder hereof
may have additional obligations with respect to this Certificate, including tax liabilities,
and may be entitled to certain additional distributions hereon, in accordance with the terms
and provisions of the Agreement.
No transfer of this Class R-__ Certificate will be made unless such transfer is
exempt from the registration requirements of the Securities Act of 1933, as amended, and any
applicable state securities laws or is made in accordance with said Act and laws. In the
event that such a transfer is to be made, (i) the Trustee or the Depositor may require an
opinion of counsel acceptable to and in form and substance satisfactory to the Trustee and
the Depositor that such transfer is exempt (describing the applicable exemption and the
basis therefor) from or is being made pursuant to the registration requirements of the
Securities Act of 1933, as amended, and of any applicable statute of any state and (ii) the
transferee shall execute an investment letter in the form described by the Agreement. The
Holder hereof desiring to effect such transfer shall, and does hereby agree to, indemnify
the Trustee, the Depositor, the Master Servicer and the Certificate Registrar acting on
behalf of the Trustee against any liability that may result if the transfer is not so exempt
or is not made in accordance with such Federal and state laws. As described above, no
transfer of this Certificate (or any interest therein) shall be made unless the transferee
provides the Trustee, the Depositor and the Master Servicer with either (a) a certification
pursuant to Section 5.02(e) of the Agreement stating that the transferee is not an employee
benefit or other plan subject to the prohibited transaction provisions of ERISA or Section
4975 of the Code (each, an ERISA Plan), or any Person (including an insurance company
investing its general accounts, an investment manager, a named fiduciary or a trustee of any
ERISA Plan) who is using plan assets, within the meaning of the U.S. Department of Labor
regulation promulgated at 29 C.F.R. 2510.3-101, of any ERISA Plan (each, an ERISA Plan
Investor) to effect such acquisition, or (b) an opinion of counsel acceptable to and in
form and substance satisfactory to the Trustee, the Depositor and the Master Servicer to the
effect that the purchase and holding of this Certificate is permissible under applicable
law, will not constitute or result in a non-exempt prohibited transaction under Section 406
of ERISA or Section 4975 of the Code (or comparable provisions of any subsequent
enactments), and will not subject the Trustee, the Depositor or the Master Servicer to any
obligation or liability (including obligations or liabilities under ERISA or Section 4975 of
the Code) in addition to those undertaken in the Agreement, which opinion of counsel shall
not be an expense of the Trustee, the Depositor or the Master Servicer.
This Certificate is one of a duly authorized issue of Certificates issued in several
Classes designated as Mortgage Asset-Backed Pass-Through Certificates of the Series
specified hereon (herein collectively called the Certificates).
The Certificates are limited in right of payment to certain collections and
recoveries respecting the Mortgage Loans, all as more specifically set forth herein and in
the Agreement. In the event Master Servicer funds are advanced with respect to any Mortgage
Loan, such advance is reimbursable to the Master Servicer, to the extent provided in the
Agreement, from related recoveries on such Mortgage Loan or from other cash that would have
been distributable to Certificateholders.
As provided in the Agreement, withdrawals from the Custodial Account and/or the
Certificate Account created for the benefit of Certificateholders may be made by the Master
Servicer from time to time for purposes other than distributions to Certificateholders, such
purposes including without limitation reimbursement to the Depositor and the Master
Servicer of advances made, or certain expenses incurred, by either of them.
The Agreement permits, with certain exceptions therein provided, the amendment of the
Agreement and the modification of the rights and obligations of the Depositor, the Master
Servicer and the Trustee and the rights of the Certificateholders under the Agreement at any
time by the Depositor, the Master Servicer and the Trustee with the consent of the Holders
of Certificates evidencing in the aggregate not less than 66% of the Percentage Interests of
each Class of Certificates affected thereby. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future holders of
this Certificate and of any Certificate issued upon the transfer hereof or in exchange
herefor or in lieu hereof whether or not notation of such consent is made upon the
Certificate. The Agreement also permits the amendment thereof in certain circumstances
without the consent of the Holders of any of the Certificates and, in certain additional
circumstances, without the consent of the Holders of certain Classes of Certificates.
As provided in the Agreement and subject to certain limitations therein set forth,
the transfer of this Certificate is registrable in the Certificate Register upon surrender
of this Certificate for registration of transfer at the offices or agencies appointed by the
Trustee in the City and State of New York, duly endorsed by, or accompanied by an assignment
in the form below or other written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by the Holder hereof or such Holders
attorney duly authorized in writing, and thereupon one or more new Certificates of
authorized denominations evidencing the same Class and aggregate Percentage Interest will be
issued to the designated transferee or transferees.
The Certificates are issuable only as registered Certificates without coupons in
Classes and in denominations specified in the Agreement. As provided in the Agreement and
subject to certain limitations therein set forth, Certificates are exchangeable for new
Certificates of authorized denominations evidencing the same class and aggregate Percentage
Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer or exchange, but
the Trustee may require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.
The Depositor, the Master Servicer, the Trustee and the Certificate Registrar and any
agent of the Depositor, the Master Servicer, the Trustee or the Certificate Registrar may
treat the Person in whose name this Certificate is registered as the owner hereof for all
purposes, and neither the Depositor, the Master Servicer, the Trustee nor any such agent
shall be affected by notice to the contrary.
This Certificate shall be governed by and construed in accordance with the laws of
the State of New York without regard to the conflicts of laws principles thereof, other than
Sections 5-1401 and 5-1405 of the New York Obligations Law.
The obligations created by the Agreement in respect of the Certificates and the Trust
Fund created thereby shall terminate upon the payment to Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to the
Agreement following the earlier of (i) the maturity or other liquidation of the last
Mortgage Loan subject thereto or the disposition of all property acquired upon foreclosure
or deed in lieu of foreclosure of any Mortgage Loan and (ii) the purchase by the Master
Servicer or its designee from the Trust Fund of all remaining Mortgage Loans and all
property acquired in respect of such Mortgage Loans, thereby effecting early retirement of
the related Certificates. The Agreement permits, but does not require, the Master Servicer
or its designee to (i) purchase at a price determined as provided in the Agreement all
remaining Mortgage Loans and all property acquired in respect of any Mortgage Loan or (ii)
purchase in whole, but not in part, all of the Class [____] Certificates from the Holders
thereof; provided, that any such option may only be exercised if the aggregated Stated
Principal Balance of the Mortgage Loans as of the Distribution Date upon which the proceeds
of any such purchase are distributed is less than ten percent of the Cut-off Date Principal
Balance of the Mortgage Loans.
Reference is hereby made to the further provisions of this Certificate set forth on
the reverse hereof, which further provisions shall for all purpose have the same effect as
if set forth at this place.
Unless the certificate of authentication hereon has been executed by the Certificate
Registrar, by manual signature, this Certificate shall not be entitled to any benefit under
the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly executed.
Dated: December ____, 2005 JPMORGAN CHASE BANK, N.A.
as Trustee
By:_________________________
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class [A- ] Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.,
as Certificate Registrar
By:____________________________
Authorized Signatory
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
(Please print or typewrite name and address including postal zip code of assignee) a
Percentage Interest evidenced by the within Mortgage Asset-Backed Pass-Through Certificate
and hereby authorizes the transfer of registration of such interest to assignee on the
Certificate Register of the Trust Fund.
I (We) further direct the Certificate Registrar to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate to the
following address:
Dated: ___________________________________________
Signature by or on behalf of assignor
__________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately available
funds to _______________________for the account of __________________ account number
______________, or, if mailed by check, to ____________________________. Applicable
statements should be mailed to ________________________.
This information is provided by _____________________, the assignee named above, or
________________, as its agent.
EXHIBIT F
CUSTODIAL AGREEMENT
[To be inserted]
EXHIBIT G
LOAN SCHEDULE
(Filed Manually)
EXHIBIT H
FORM OF REQUEST FOR RELEASE
DATE:
TO:
RE: .......REQUEST FOR RELEASE OF DOCUMENTS
In connection with the administration of the pool of Mortgage Loans held by you for the
referenced pool, we request the release of the Mortgage Loan File described below.
Pooling and Servicing Agreement Dated:
Series#:
Account#:
Pool#:
Loan#:
Borrower Name(s):
Reason for Document Request: (circle one) Mortgage Loan Prepaid in Full
....... Mortgage Loan Repurchased
We hereby certify that all amounts received or to be received in connection with such
payments which are required to be deposited have been or will be so deposited as provided in
the Pooling and Servicing Agreement.
_______________________________________
Residential Funding Corporation
Authorized Signature
****************************************************************
TO CUSTODIAN/TRUSTEE: Please acknowledge this request, and check off documents being
enclosed with a copy of this form. You should retain this form for your files in accordance
with the terms of the Pooling and Servicing Agreement.
Enclosed Documents: [ ] Promissory Note
[ ] Primary Insurance Policy
[ ] Mortgage or Deed of Trust
[ ] Assignment(s) of Mortgage or Deed of Trust
[ ] Title Insurance Policy
[ ] Other:
___________________________________
Name
___________________________________
Title
___________________________________
Date
EXHIBIT I-1
FORM OF TRANSFER AFFIDAVIT AND AGREEMENT
STATE OF....... )
....... ) ss.:
COUNTY OF...... )
[NAME OF OFFICER], being first duly sworn, deposes and says:
1......That he is [Title of Officer] of [Name of Owner] (record or beneficial owner
of the Mortgage Asset-Backed Pass-Through Certificates, Series _______, Class R[-__] (the
Owner), a [savings institution] [corporation] duly organized and existing under the laws of
[the State of ] [the United States], on behalf of which he makes this affidavit and
agreement.
2......That the Owner (i) is not and will not be a disqualified organization or an
electing large partnership as of [date of transfer] within the meaning of Sections
860E(e)(5) and 775, respectively, of the Internal Revenue Code of 1986, as amended (the
Code) or an electing large partnership under Section 775(a) of the Code, (ii) will endeavor
to remain other than a disqualified organization for so long as it retains its ownership
interest in the Class R[-__] Certificates, and (iii) is acquiring the Class R[-__]
Certificates for its own account or for the account of another Owner from which it has
received an affidavit and agreement in substantially the same form as this affidavit and
agreement. (For this purpose, a disqualified organization means an electing large
partnership under Section 775 of the Code, the United States, any state or political
subdivision thereof, any agency or instrumentality of any of the foregoing (other than an
instrumentality all of the activities of which are subject to tax and, except for the
Federal Home Loan Mortgage Corporation, a majority of whose board of directors is not
selected by any such governmental entity) or any foreign government, international
organization or any agency or instrumentality of such foreign government or organization,
any rural electric or telephone cooperative, or any organization (other than certain
farmers cooperatives) that is generally exempt from federal income tax unless such
organization is subject to the tax on unrelated business taxable income).
3......That the Owner is aware (i) of the tax that would be imposed on transfers of
Class R[-__] Certificates to disqualified organizations or electing large partnerships,
under the Code, that applies to all transfers of Class R[-__] Certificates after March 31,
1988; (ii) that such tax would be on the transferor (or, with respect to transfers to
electing large partnerships, on each such partnership), or, if such transfer is through an
agent (which person includes a broker, nominee or middleman) for a disqualified
organization, on the agent; (iii) that the person (other than with respect to transfers to
electing large partnerships) otherwise liable for the tax shall be relieved of liability for
the tax if the transferee furnishes to such person an affidavit that the transferee is not a
disqualified organization and, at the time of transfer, such person does not have actual
knowledge that the affidavit is false; and (iv) that the Class R[-__] Certificates may be
noneconomic residual interests within the meaning of Treasury regulations promulgated
pursuant to the Code and that the transferor of a noneconomic residual interest will remain
liable for any taxes due with respect to the income on such residual interest, unless no
significant purpose of the transfer was to impede the assessment or collection of tax.
4......That the Owner is aware of the tax imposed on a pass-through entity holding
Class R[-__] Certificates if either the pass-through entity is an electing large partnership
under Section 775 of the Code or if at any time during the taxable year of the pass-through
entity a disqualified organization is the record holder of an interest in such entity. (For
this purpose, a pass through entity includes a regulated investment company, a real estate
investment trust or common trust fund, a partnership, trust or estate, and certain
cooperatives.)
5......The Owner is either (i) a citizen or resident of the United States, (ii) a
corporation, partnership or other entity treated as a corporation or a partnership for U.S.
federal income tax purposes and created or organized in or under the laws of the United
States, any state thereof or the District of Columbia (other than a partnership that is not
treated as a United States person under any applicable Treasury regulations), (iii) an
estate that is described in Section 7701(a)(30)(D) of the Code, or (iv) a trust that is
described in Section 7701(a)(30)(E) of the Code.
6......The Owner hereby agrees that it will not cause income from the Class R[-__]
Certificates to be attributable to a foreign permanent establishment or fixed base (within
the meaning of an applicable income tax treaty) of the Owner of another United States
taxpayer.
7......That the Owner is aware that the Trustee will not register the transfer of any
Class R[- __] Certificates unless the transferee, or the transferees agent, delivers to it
an affidavit and agreement, among other things, in substantially the same form as this
affidavit and agreement. The Owner expressly agrees that it will not consummate any such
transfer if it knows or believes that any of the representations contained in such affidavit
and agreement are false.
8......That the Owner has reviewed the restrictions set forth on the face of the
Class R[-__] Certificates and the provisions of Section 5.02(f) of the Pooling and Servicing
Agreement under which the Class R[-__] Certificates were issued (in particular, clause
(iii)(A) and (iii)(B) of Section 5.02(f) which authorize the Trustee to deliver payments to
a person other than the Owner and negotiate a mandatory sale by the Trustee in the event the
Owner holds such Certificates in violation of Section 5.02(f)). The Owner expressly agrees
to be bound by and to comply with such restrictions and provisions.
9......That the Owner consents to any additional restrictions or arrangements that
shall be deemed necessary upon advice of counsel to constitute a reasonable arrangement to
ensure that the Class R[-__] Certificates will only be owned, directly or indirectly, by an
Owner that is not a disqualified organization.
10. The Owners Taxpayer Identification Number is ________________.
11. This affidavit and agreement relates only to the Class R[-__] Certificates
held by the Owner and not to any other holder of the Class R[-__] Certificates. The Owner
understands that the liabilities described herein relate only to the Class R[-__]
Certificates.
12. That no purpose of the Owner relating to the transfer of any of the Class
R[-__] Certificates by the Owner is or will be to impede the assessment or collection of any
tax; in making this representation, the Owner warrants that the Owner is familiar with (i)
Treasury Regulation Section 1.860E-1(c) and recent amendments thereto, effective as of July
19, 2002, and (ii) the preamble describing the adoption of the amendments to such
regulation, which is attached hereto as Exhibit 1.
13. That the Owner has no present knowledge or expectation that it will be unable
to pay any United States taxes owed by it so long as any of the Certificates remain
outstanding. In this regard, the Owner hereby represents to and for the benefit of the
person from whom it acquired the Class R[-__] Certificate that the Owner intends to pay
taxes associated with holding such Class R[- __] Certificate as they become due, fully
understanding that it may incur tax liabilities in excess of any cash flows generated by the
Class R[-__] Certificate.
14. That the Owner has no present knowledge or expectation that it will become
insolvent or subject to a bankruptcy proceeding for so long as any of the Class R[-__]
Certificates remain outstanding.
15. (a) The Owner is not an employee benefit plan or other plan subject to the
prohibited transaction provisions of the Employee Retirement Income Security Act of 1974, as
amended (ERISA), or Section 4975 of the Internal Revenue Code of 1986, as amended (the
Code) (each, an ERISA Plan), or any person (including an insurance company investing its
general accounts, an investment manager, a named fiduciary or a trustee of any ERISA Plan)
who is using plan assets, within the meaning of the U.S. Department of Labor regulation
promulgated at 29 C.F.R. 2510.3-101, of any ERISA Plan (each, an ERISA Plan Investor) to
effect such acquisition; or
(b) The Owner has provided the Trustee, the Depositor and the Master Servicer
with an opinion of counsel acceptable to and in form and substance satisfactory to the
Trustee, the Depositor and the Master Servicer to the effect that the purchase and holding
of Certificates is permissible under applicable law, will not constitute or result in any
non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code (or
comparable provisions of any subsequent enactments) and will not subject the Trustee, the
Depositor or the Master Servicer to any obligation or liability (including obligations or
liabilities under ERISA or Section 4975 of the Code) in addition to those undertaken in the
Pooling and Servicing Agreement which opinion of counsel shall not be an expense of the
Trustee, the Depositor or the Master Servicer.
In addition, the Owner hereby certifies, represents and warrants to, and covenants
with, the Depositor, the Trustee and the Master Servicer that the Purchaser will not
transfer such Certificates to any transferee unless either such transferee meets the
requirements set forth in either (a) or (b) above.
Capitalized terms used but not defined herein shall have the meanings assigned in the
Pooling and Servicing Agreement.
IN WITNESS WHEREOF, the Owner has caused this instrument to be executed on its
behalf, pursuant to the authority of its Board of Directors, by its [Title of Officer] and
its corporate seal to be hereunto attached, attested by its [Assistant] Secretary, this day
of _____,___ 200__.
[NAME OF OWNER]
By:...............................................
[Name of Officer]
[Title of Officer]
[Corporate Seal]
ATTEST:
________________________________
[Assistant] Secretary
Personally appeared before me the above-named [Name of Officer], known or proved to
me to be the same person who executed the foregoing instrument and to be the [Title of
Officer] of the Owner, and acknowledged to me that he executed the same as his free act and
deed and the free act and deed of the Owner.
Subscribed and sworn before me this ___ day of ________, 200 __.
...............................................................................................
NOTARY PUBLIC
COUNTY OF.........................................
STATE OF..........................................
My Commission expires the ____ day of _____, 20__
.
EXHIBIT 1
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Parts 1 and 602
[TD 9004]
RIN 1545-AW98
Real Estate Mortgage Investment Conduits
AGENCY: Internal Revenue Service (IRS), Treasury.
ACTION: Final regulations.
SUMMARY: This document contains final regulations relating to safe harbor transfers
of noneconomic residual interests in real estate mortgage investment conduits (REMICs). The
final regulations provide additional limitations on the circumstances under which
transferors may claim safe harbor treatment.
DATES: Effective Date: These regulations are effective July 19, 2002.
Applicability Date: For dates of applicability, see Sec. 1.860E-(1)(c)(10).
FOR FURTHER INFORMATION CONTACT: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ at (▇▇▇) ▇▇▇-▇▇▇▇ (not a toll-free
number).
SUPPLEMENTARY INFORMATION:
Paperwork Reduction Act
The collection of information in this final rule has been reviewed and, pending
receipt and evaluation of public comments, approved by the Office of Management and Budget
(OMB) under 44 U.S.C. 3507 and assigned control number 1545-1675.
The collection of information in this regulation is in Sec. 1.860E - 1(c)(5)(ii).
This information is required to enable the IRS to verify that a taxpayer is complying with
the conditions of this regulation. The collection of information is mandatory and is
required. Otherwise, the taxpayer will not receive the benefit of safe harbor treatment as
provided in the regulation. The likely respondents are businesses and other for-profit
institutions.
Comments on the collection of information should be sent to the Office of Management
and Budget, Attn: Desk Officer for the Department of the Treasury, Office of Information and
Regulatory Affairs, ▇▇▇▇▇▇▇▇▇▇, ▇▇, ▇▇▇▇▇, with copies to the Internal Revenue Service,
Attn: IRS Reports Clearance Officer, W:CAR:MP:FP:S, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇. Comments on the
collection of information should be received by October 17, 2002. Comments are specifically
requested concerning:
Whether the collection of information is necessary for the proper performance of the
functions of the Internal Revenue Service, including whether the information will have
practical utility; The accuracy of the estimated burden associated with the collection of
information (see below);
How the quality, utility, and clarity of the information to be collected may be
enhanced;
How the burden of complying with the collection of information may be minimized,
including through the application of automated collection techniques or other forms of
information technology; and
Estimates of capital or start-up costs and costs of operation, maintenance, and
purchase of service to provide information.
An agency may not conduct or sponsor, and a person is not required to respond to, a
collection of information unless it displays a valid control number assigned by the Office
of Management and Budget.
The estimated total annual reporting burden is 470 hours, based on an estimated
number of respondents of 470 and an estimated average annual burden hours per respondent of
one hour.
Books or records relating to a collection of information must be retained as long as
their contents may become material in the administration of any internal revenue law.
Generally, tax returns and tax return information are confidential, as required by 26 U.S.C.
6103.
BACKGROUND
This document contains final regulations regarding the proposed amendments to 26 CFR
part 1 under section 860E of the Internal Revenue Code (Code). The regulations provide the
circumstances under which a transferor of a noneconomic REMIC residual interest meeting the
investigation and representation requirements may avail itself of the safe harbor by
satisfying either the formula test or the asset test.
Final regulations governing REMICs, issued in 1992, contain rules governing the
transfer of noneconomic REMIC residual interests. In general, a transfer of a noneconomic
residual interest is disregarded for all tax purposes if a significant purpose of the
transfer is to enable the transferor to impede the assessment or collection of tax. A
purpose to impede the assessment or collection of tax (a wrongful purpose) exists if the
transferor, at the time of the transfer, either knew or should have known that the
transferee would be unwilling or unable to pay taxes due on its share of the REMICs taxable
income.
Under a safe harbor, the transferor of a REMIC noneconomic residual interest is
presumed not to have a wrongful purpose if two requirements are satisfied: (1) the
transferor conducts a reasonable investigation of the transferees financial condition (the
investigation requirement); and (2) the transferor secures a representation from the
transferee to the effect that the transferee understands the tax obligations associated with
holding a residual interest and intends to pay those taxes (the representation requirement).
The IRS and Treasury have been concerned that some transferors of noneconomic
residual interests claim they satisfy the safe harbor even in situations where the economics
of the transfer clearly indicate the transferee is unwilling or unable to pay the tax
associated with holding the interest. For this reason, on February 7, 2000, the IRS
published in the Federal Register (65 FR 5807) a notice of proposed rulemaking
(REG-100276-97; REG-122450-98) designed to clarify the safe harbor by adding the formula
test, an economic test. The proposed regulation provides that the safe harbor is
unavailable unless the present value of the anticipated tax liabilities associated with
holding the residual interest does not exceed the sum of: (1) The present value of any
consideration given to the transferee to acquire the interest; (2) the present value of the
expected future distributions on the interest; and (3) the present value of the anticipated
tax savings associated with holding the interest as the REMIC generates losses.
The notice of proposed rulemaking also contained rules for FASITs. Section
1.860H-6(g) of the proposed regulations provides requirements for transfers of FASIT
ownership interests and adopts a safe harbor by reference to the safe harbor provisions of
the REMIC regulations.
In January 2001, the IRS published Rev. Proc. 2001-12 (2001-3 I.R.B. 335) to set
forth an alternative safe harbor that taxpayers could use while the IRS and the Treasury
considered comments on the proposed regulations. Under the alternative safe harbor, if a
transferor meets the investigation requirement and the representation requirement but the
transfer fails to meet the formula test, the transferor may invoke the safe harbor if the
transferee meets a two- prong test (the asset test). A transferee generally meets the first
prong of this test if, at the time of the transfer, and in each of the two years preceding
the year of transfer, the transferees gross assets exceed $100 million and its net assets
exceed $10 million. A transferee generally meets the second prong of this test if it is a
domestic, taxable corporation and agrees in writing not to transfer the interest to any
person other than another domestic, taxable corporation that also satisfies the requirements
of the asset test. A transferor cannot rely on the asset test if the transferor knows, or
has reason to know, that the transferee will not comply with its written agreement to limit
the restrictions on subsequent transfers of the residual interest. Rev. Proc. 2001-12
provides that the asset test fails to be satisfied in the case of a transfer or assignment
of a noneconomic residual interest to a foreign branch of an otherwise eligible transferee.
If such a transfer or assignment were permitted, a corporate taxpayer might seek to claim
that the provisions of an applicable income tax treaty would resource excess inclusion
income as foreign source income, and that, as a consequence, any U.S. tax liability
attributable to the excess inclusion income could be offset by foreign tax credits. Such a
claim would impede the assessment or collection of U.S. tax on excess inclusion income,
contrary to the congressional purpose of assuring that such income will be taxable in all
events. See, e.g., sections 860E(a)(1), (b), (e) and 860G(b) of the Code.
The Treasury and the IRS have learned that certain taxpayers transferring noneconomic
residual interests to foreign branches have attempted to rely on the formula test to obtain
safe harbor treatment in an effort to impede the assessment or collection of U.S. tax on
excess inclusion income. Accordingly, the final regulations provide that if a noneconomic
residual interest is transferred to a foreign permanent establishment or fixed base of a
U.S. taxpayer, the transfer is not eligible for safe harbor treatment under either the asset
test or the formula test. The final regulations also require a transferee to represent that
it will not cause income from the noneconomic residual interest to be attributable to a
foreign permanent establishment or fixed base.
Section 1.860E -1(c)(8) provides computational rules that a taxpayer may use to
qualify for safe harbor status under the formula test. Section 1.860E-1(c)(8)(i) provides
that the transferee is presumed to pay tax at a rate equal to the highest rate of tax
specified in section 11(b). Some commentators were concerned that this presumed rate of
taxation was too high because it does not take into consideration taxpayers subject to the
alternative minimum tax rate. In light of the comments received, this provision has been
amended in the final regulations to allow certain transferees that compute their taxable
income using the alternative minimum tax rate to use the alternative minimum tax rate
applicable to corporations.
Additionally, Sec. 1.860E-1(c)(8)(iii) provides that the present values in the
formula test are to be computed using a discount rate equal to the applicable Federal
short-term rate prescribed by section 1274(d). This is a change from the proposed regulation
and Rev. Proc. 2001-12. In those publications the provision stated that present values are
computed using a discount rate equal to the applicable Federal rate prescribed in section
1274(d) compounded semiannually and that [a] lower discount rate may be used if the
transferee can demonstrate that it regularly borrows, in the course of its trade or
business, substantial funds at such lower rate from an unrelated third party. The IRS and
the Treasury Department have learned that, based on this provision, certain taxpayers have
been attempting to use unrealistically low or zero interest rates to satisfy the formula
test, frustrating the intent of the test. Furthermore, the Treasury Department and the IRS
believe that a rule allowing for a rate other than a rate based on an objective index would
add unnecessary complexity to the safe harbor. As a result, the rule in the proposed
regulations that permits a transferee to use a lower discount rate, if the transferee can
demonstrate that it regularly borrows substantial funds at such lower rate, is not included
in the final regulations; and the Federal short-term rate has been substituted for the
applicable Federal rate. To simplify taxpayers computations, the final regulations allow
use of any of the published short-term rates, provided that the present values are computed
with a corresponding period of compounding. With the exception of the provisions relating to
transfers to foreign branches, these changes generally have the proposed applicability date
of February 4, 2000, but taxpayers may choose to apply the interest rate formula set forth
in the proposed regulation and Rev. Proc. 2001-12 for transfers occurring before August 19,
2002.
It is anticipated that when final regulations are adopted with respect to
FASITs, Sec. 1.860H-6(g) of the proposed regulations will be adopted in substantially
its present form, with the result that the final regulations contained in this document will
also govern transfers of FASIT ownership interests with substantially the same applicability
date as is contained in this document.
Effect on Other Documents
Rev. Proc. 2001-12 (2001-3 I.R.B. 335) is obsolete for transfers of noneconomic
residual interests in REMICs occurring on or after August 19, 2002.
Special Analyses
It is hereby certified that these regulations will not have a significant economic
impact on a substantial number of small entities. This certification is based on the fact
that it is unlikely that a substantial number of small entities will hold REMIC residual
interests. Therefore, a Regulatory Flexibility Analysis under the Regulatory Flexibility Act
(5 U.S.C. chapter 6) is not required. It has been determined that this Treasury decision is
not a significant regulatory action as defined in Executive Order 12866. Therefore, a
regulatory assessment is not required. It also has been determined that sections 553(b) and
553(d) of the Administrative Procedure Act (5 U.S.C. chapter 5) do not apply to these
regulations.
Drafting Information
The principal author of these regulations is ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇. However, other
personnel from the IRS and Treasury Department participated in their development.
List of Subjects
26 CFR Part 1
Income taxes, Reporting and record keeping requirements.
26 CFR Part 602
Reporting and record keeping requirements.
Adoption of Amendments to the Regulations
Accordingly, 26 CFR parts 1 and 602 are amended as follows:
PART 1-INCOME TAXES
Paragraph 1. The authority citation for part 1 continues to read in part as follows:
Authority: 26 U.S.C. 7805 * * *
EXHIBIT I-2
FORM OF TRANSFEROR CERTIFICATE
__________________, 200__
Residential Asset Mortgage Products, Inc.
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JPMorgan Chase Bank, N.A.
4 New York Plaza, 6th Floor
New York, New York 10004
Attention: Residential Funding Corporation Series 2005-SP3
Re: Mortgage Asset-Backed Pass-Through Certificates,
Series 2005-SP3, Class R-[ ]
Ladies and Gentlemen:
This letter is delivered to you in connection with the transfer by
_______________________________ (the Seller) to _______________________________ (the
Purchaser) of $_____________ Initial Certificate Principal Balance of Mortgage Asset-Backed
Pass-Through Certificates, Series 2005-SP3, Class R-[__] (the Certificates), pursuant to
Section 5.02 of the Pooling and Servicing Agreement (the Pooling and Servicing Agreement),
dated as of December 1, 2005 among Residential Asset Mortgage Products, Inc., as seller (the
Depositor), Residential Funding Corporation, as master servicer, and JPMorgan Chase Bank,
N.A., as trustee (the Trustee). All terms used herein and not otherwise defined shall
have the meanings set forth in the Pooling and Servicing Agreement. The Seller hereby
certifies, represents and warrants to, and covenants with, the Depositor and the Trustee
that:
1. No purpose of the Seller relating to the transfer of the Certificate by
the Seller to the Purchaser is or will be to impede the assessment or collection of any tax.
2. The Seller understands that the Purchaser has delivered to the Trustee
and the Master Servicer a transfer affidavit and agreement in the form attached to the
Pooling and Servicing Agreement as [Exhibit H-1]. The Seller does not know or believe that
any representation contained therein is false.
3. The Seller has at the time of the transfer conducted a reasonable
investigation of the financial condition of the Purchaser as contemplated by Treasury
Regulations Section 1.860E-1(c)(4)(i) and, as a result of that investigation, the Seller has
determined that the Purchaser has historically paid its debts as they become due and has
found no significant evidence to indicate that the Purchaser will not continue to pay its
debts as they become due in the future. The Seller understands that the transfer of a Class
R Certificate may not be respected for United States income tax purposes (and the Seller may
continue to be liable for United States income taxes associated therewith) unless the Seller
has conducted such an investigation.
4. The Seller has no actual knowledge that the proposed Purchaser is not
both a United States Person and a Permitted Transferee.
Very truly yours,
_______________________________________
(Seller)
By:____________________________________
Name:_________________________________
Title:__________________________________
EXHIBIT J
FORM OF INVESTOR REPRESENTATION LETTER
______________, 20__
Residential Asset Mortgage Products, Inc
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JPMorgan Chase Bank, N.A.
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Residential Funding Corporation
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Attention: Residential Asset Mortgage Products, Inc., Series 2005-SP3
Re: Mortgage Asset-Backed Pass-Through Certificates,
Series 2005-SP3, Class B
Ladies and Gentlemen:
_________________________ (the Purchaser) intends to purchase from
___________________________ (the Seller) $_____________ Initial Certificate Principal
Balance of Mortgage Asset-Backed Pass-Through Certificates, Series 2005-SP3, Class B (the
Certificates), issued pursuant to the Pooling and Servicing Agreement (the Pooling and
Servicing Agreement), dated as of December 1, 2005, among Residential Asset Mortgage
Products, Inc., as seller (the Depositor), Residential Funding Corporation, as master
servicer (the Master Servicer), and JPMorgan Chase Bank, N.A., as trustee (the
Trustee). All terms used herein and not otherwise defined shall have the meanings set
forth in the Pooling and Servicing Agreement. The Purchaser hereby certifies, represents
and warrants to, and covenants with, the Depositor, the Trustee and the Master Servicer that:
1. The Purchaser understands that (a) the Certificates have not been and
will not be registered or qualified under the Securities Act of 1933, as amended (the
Act) or any state securities law, (b) the Depositor is not required to so register
or qualify the Certificates, (c) the Certificates may be resold only if registered
and qualified pursuant to the provisions of the Act or any state securities law, or
if an exemption from such registration and qualification is available, (d) the
Pooling and Servicing Agreement contains restrictions regarding the transfer of the
Certificates and (e) the Certificates will bear a legend to the foregoing effect.
2. The Purchaser is acquiring the Certificates for its own account for
investment only and not with a view to or for sale in connection with any
distribution thereof in any manner that would violate the Act or any applicable state
securities laws.
3. The Purchaser is (a) a substantial, sophisticated institutional
investor having such knowledge and experience in financial and business matters, and,
in particular, in such matters related to securities similar to the Certificates,
such that it is capable of evaluating the merits and risks of investment in the
Certificates, (b) able to bear the economic risks of such an investment and (c) an
accredited investor within the meaning of Rule 501(a) promulgated pursuant to the
Act.
4. The Purchaser has been furnished with, and has had an opportunity to
review (a) [a copy of the Private Placement Memorandum, dated ___________________,
20__, relating to the Certificates (b)] a copy of the Pooling and Servicing Agreement
and [b] [c] such other information concerning the Certificates, the Mortgage Loans
and the Depositor as has been requested by the Purchaser from the Depositor or the
Seller and is relevant to the Purchasers decision to purchase the Certificates. The
Purchaser has had any questions arising from such review answered by the Depositor or
the Seller to the satisfaction of the Purchaser. [If the Purchaser did not purchase
the Certificates from the Seller in connection with the initial distribution of the
Certificates and was provided with a copy of the Private Placement Memorandum (the
Memorandum) relating to the original sale (the Original Sale) of the Certificates
by the Depositor, the Purchaser acknowledges that such Memorandum was provided to it
by the Seller, that the Memorandum was prepared by the Depositor solely for use in
connection with the Original Sale and the Depositor did not participate in or
facilitate in any way the purchase of the Certificates by the Purchaser from the
Seller, and the Purchaser agrees that it will look solely to the Seller and not to
the Depositor with respect to any damage, liability, claim or expense arising out of,
resulting from or in connection with (a) error or omission, or alleged error or
omission, contained in the Memorandum, or (b) any information, development or event
arising after the date of the Memorandum.]
5. The Purchaser has not and will not nor has it authorized or will it
authorize any person to (a) offer, pledge, sell, dispose of or otherwise transfer any
Certificate, any interest in any Certificate or any other similar security to any
person in any manner, (b) solicit any offer to buy or to accept a pledge, disposition
of other transfer of any Certificate, any interest in any Certificate or any other
similar security from any person in any manner, (c) otherwise approach or negotiate
with respect to any Certificate, any interest in any Certificate or any other similar
security with any person in any manner, (d) make any general solicitation by means of
general advertising or in any other manner or (e) take any other action, that (as to
any of (a) through (e) above) would constitute a distribution of any Certificate
under the Act, that would render the disposition of any Certificate a violation of
Section 5 of the Act or any state securities law, or that would require registration
or qualification pursuant thereto. The Purchaser will not sell or otherwise transfer
any of the Certificates, except in compliance with the provisions of the Pooling and
Servicing Agreement.
6. The Purchaser hereby certifies, represents and warrants to, and
covenants with the Depositor, the Trustee and the Master Servicer that the following
statements in (a) or (b) are correct:
(a) The Purchaser is not an employee benefit plan or other plan subject to
the prohibited transaction provisions of the Employee Retirement Income Security Act
of 1974, as amended (ERISA), or Section 4975 of the Internal Revenue Code of 1986,
as amended (the Code) (each, an ERISA Plan), or any person (including an
insurance company investing its general accounts, an investment manager, a named
fiduciary or a trustee of any ERISA Plan) who is using plan assets, within the
meaning of the U.S. Department of Labor (DOL) regulation promulgated at 29 C.F.R.
2510.3, of any ERISA Plan (each, an ERISA Plan Investor), to effect such
acquisition;
(b) In the case of a Class B Certificate, the Purchaser is an insurance
company, the source of funds used to purchase or hold the Certificate (or any
interest therein) is an insurance company general account (as defined in DOL
Prohibited Transaction Class Exemption (PTCE) 95-60), and the conditions set forth
in Sections I and III of PTCE 95-60 have been satisfied; or
(c) The Purchaser has provided the Trustee, the Depositor and the Master
Servicer with an opinion of counsel acceptable to and in form and substance
satisfactory to the Trustee, the Depositor and the Master Servicer to the effect that
the purchase and holding of the Certificates is permissible under applicable law,
will not constitute or result in a non-exempt prohibited transaction under Section
406 of ERISA or Section 4975 of the Code (or comparable provisions of any subsequent
enactments), and will not subject the Trustee, the Depositor or the Master Servicer
to any obligation or liability (including obligations or liabilities under ERISA or
Section 4975 of the Code) in addition to those undertaken in the Agreement, which
opinion of counsel shall not be an expense of the Trustee, the Depositor or the
Master Servicer.
In addition, the Purchaser hereby certifies, represents and warrants to, and
covenants with, the Depositor, the Trustee and the Master Servicer that the Purchaser
will not transfer such Certificates to any transferee unless such transferee meets
the requirements set forth in either [(a), (b) or (c)] above.
Very truly yours,
________________________________________
(Purchaser)
By:_____________________________________
Name:__________________________________
Title:___________________________________
EXHIBIT K
FORM OF TRANSFEROR REPRESENTATION LETTER
______, 2__
Residential Asset Mortgage Products, Inc
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JPMorgan Chase Bank, N.A.
4 New York Plaza, 6th Floor
New York, New York 10004
Attention: Residential Asset Mortgage Products, Inc., Series 2005-SP3
Re: Mortgage Asset-Backed Pass-Through Certificates,
Series 2005-SP3, Class [R-]
Ladies and Gentlemen:
In connection with the sale by (the Seller) to
(the Purchaser) of $ Initial Certificate Principal Balance of
Mortgage Asset-Backed Pass-Through Certificates, Series 2005-SP3, Class [R-__] (the
Certificates), issued pursuant to the Pooling and Servicing Agreement (the Pooling and
Servicing Agreement), dated as of December 1, 2005, among Residential Asset Mortgage
Products, Inc., as seller (the Depositor), Residential Funding Corporation, as master
servicer, and JPMorgan Chase Bank, N.A., as trustee (the Trustee), the Seller hereby
certifies, represents and warrants to, and covenants with, the Depositor and the Trustee
that:
Neither the Seller nor anyone acting on its behalf has (a) offered, pledged,
sold, disposed of or otherwise transferred any Certificate, any interest in any Certificate
or any other similar security to any person in any manner, (b) has solicited any offer to
buy or to accept a pledge, disposition or other transfer of any Certificate, any interest in
any Certificate or any other similar security from any person in any manner, (c) has
otherwise approached or negotiated with respect to any Certificate, any interest in any
Certificate or any other similar security with any person in any manner, (d) has made any
general solicitation by means of general advertising or in any other manner, or (e) has
taken any other action, that (as to any of (a) through (e) above) would constitute a
distribution of the Certificates under the Securities Act of 1933 (the Act), that would
render the disposition of any Certificate a violation of Section 5 of the Act or any state
securities law, or that would require registration or qualification pursuant thereto. The
Seller will not act, in any manner set forth in the foregoing sentence with respect to any
Certificate. The Seller has not and will not sell or otherwise transfer any of the
Certificates, except in compliance with the provisions of the Pooling and Servicing
Agreement.
Very truly yours,
_______________________________________
(Seller)
By:____________________________________
Name:_________________________________
Title:__________________________________
EXHIBIT L
TEXT OF AMENDMENT TO POOLING AND SERVICING
AGREEMENT PURSUANT TO SECTION 11.01(E) FOR A
LIMITED GUARANTY
ARTICLE XII
Subordinate Certificate Loss Coverage; Limited Guaranty
Section 12.01. Subordinate Certificate Loss Coverage; Limited Guaranty. (a)
Subject to subsection (c) below, prior to the later of the third Business Day prior to each
Distribution Date or the related Determination Date, the Master Servicer shall determine
whether it or any Subservicer will be entitled to any reimbursement pursuant to Section
4.02(a) on such Distribution Date for Advances or Subservicer Advances previously made,
(which will not be Advances or Subservicer Advances that were made with respect to
delinquencies which were subsequently determined to be Excess Special Hazard Losses, Excess
Fraud Losses, Excess Bankruptcy Losses or Extraordinary Losses) and, if so, the Master
Servicer shall demand payment from Residential Funding of an amount equal to the amount of
any Advances or Subservicer Advances reimbursed pursuant to Section 4.02(a), to the extent
such Advances or Subservicer Advances have not been included in the amount of the Realized
Loss in the related Mortgage Loan, and shall distribute the same to the Class B
Certificateholders in the same manner as if such amount were to be distributed pursuant to
Section 4.02(a).
(b) Subject to subsection (c) below, prior to the later of the third
Business Day prior to each Distribution Date or the related Determination Date, the Master
Servicer shall determine whether any Realized Losses (other than Excess Special Hazard
Losses, Excess Bankruptcy Losses, Excess Fraud Losses and Extraordinary Losses) will be
allocated to the Class B Certificates on such Distribution Date pursuant to Section 4.05,
and, if so, the Master Servicer shall demand payment from Residential Funding of the amount
of such Realized Loss and shall distribute the same to the Class B Certificateholders in the
same manner as if such amount were to be distributed pursuant to Section 4.02(a); provided,
however, that the amount of such demand in respect of any Distribution Date shall in no
event be greater than the sum of (i) the additional amount of Accrued Certificate Interest
that would have been paid for the Class B Certificateholders on such Distribution Date had
such Realized Loss or Losses not occurred plus (ii) the amount of the reduction in the
Certificate Principal Balances of the Class B Certificates on such Distribution Date due to
such Realized Loss or Losses. Notwithstanding such payment, such Realized Losses shall be
deemed to have been borne by the Certificateholders for purposes of Section 4.05. Excess
Special Hazard Losses, Excess Fraud Losses, Excess Bankruptcy Losses and Extraordinary
Losses allocated to the Class B Certificates will not be covered by the Subordinate
Certificate Loss Obligation.
(c) Demands for payments pursuant to this Section shall be made prior to
the later of the third Business Day prior to each Distribution Date or the related
Determination Date by the Master Servicer with written notice thereof to the Trustee. The
maximum amount that Residential Funding shall be required to pay pursuant to this Section on
any Distribution Date (the Amount Available) shall be equal to the lesser of (X)
minus the sum of (i) all previous payments made under subsections (a) and (b)
hereof and (ii) all draws under the Limited Guaranty made in lieu of such payments as
described below in subsection (d) and (Y) the then outstanding Certificate Principal
Balances of the Class B Certificates, or such lower amount as may be established pursuant to
Section 12.02. Residential Fundings obligations as described in this Section are referred
to herein as the Subordinate Certificate Loss Obligation.
(d) The Trustee will promptly notify General Motors Acceptance Corporation
of any failure of Residential Funding to make any payments hereunder and shall demand
payment pursuant to the limited guaranty (the Limited Guaranty), executed by General
Motors Acceptance Corporation, of Residential Fundings obligation to make payments pursuant
to this Section, in an amount equal to the lesser of (i) the Amount Available and (ii) such
required payments, by delivering to General Motors Acceptance Corporation a written demand
for payment by wire transfer, not later than the second Business Day prior to the
Distribution Date for such month, with a copy to the Master Servicer.
(e) All payments made by Residential Funding pursuant to this Section or
amounts paid under the Limited Guaranty shall be deposited directly in the Certificate
Account, for distribution on the Distribution Date for such month to the Class B
Certificateholders.
(f) The Depositor shall have the option, in its sole discretion, to
substitute for either or both of the Limited Guaranty or the Subordinate Certificate Loss
Obligation another instrument in the form of a corporate guaranty, an irrevocable letter of
credit, a surety bond, insurance policy or similar instrument or a reserve fund; provided
that (i) the Depositor obtains (subject to the provisions of Section 10.01(f) as if the
Depositor was substituted for the Master Servicer solely for the purposes of such provision)
an Opinion of Counsel (which need not be an opinion of Independent counsel) to the effect
that obtaining such substitute corporate guaranty, irrevocable letter of credit, surety
bond, insurance policy or similar instrument or reserve fund will not cause either (a) any
federal tax to be imposed on the Trust Fund, including without limitation, any federal tax
imposed on prohibited transactions under Section 860(F)(a)(1) of the Code or on
contributions after the startup date under Section 860(G)(d)(1) of the Code or (b) the
Trust Fund to fail to qualify as a REMIC at any time that any Certificate is outstanding,
and (ii) no such substitution shall be made unless (A) the substitute Limited Guaranty or
Subordinate Certificate Loss Obligation is for an initial amount not less than the then
current Amount Available and contains provisions that are in all material respects
equivalent to the original Limited Guaranty or Subordinate Certificate Loss Obligation
(including that no portion of the fees, reimbursements or other obligations under any such
instrument will be borne by the Trust Fund), (B) the long term debt obligations of any
obligor of any substitute Limited Guaranty or Subordinate Certificate Loss Obligation (if
not supported by the Limited Guaranty) shall be rated at least the lesser of (a) the rating
of the long term debt obligations of General Motors Acceptance Corporation as of the date of
issuance of the Limited Guaranty and (b) the rating of the long term debt obligations of
General Motors Acceptance Corporation at the date of such substitution and (C) the Depositor
obtains written confirmation from each nationally recognized credit rating agency that rated
the Class B Certificates at the request of the Depositor that such substitution shall not
lower the rating on the Class B Certificates below the lesser of (a) the then-current rating
assigned to the Class B Certificates by such rating agency and (b) the original rating
assigned to the Class B Certificates by such rating agency. Any replacement of the Limited
Guaranty or Subordinate Certificate Loss Obligation pursuant to this Section shall be
accompanied by a written Opinion of Counsel to the substitute guarantor or obligor,
addressed to the Master Servicer and the Trustee, that such substitute instrument
constitutes a legal, valid and binding obligation of the substitute guarantor or obligor,
enforceable in accordance with its terms, and concerning such other matters as the Master
Servicer and the Trustee shall reasonably request. Neither the Depositor, the Master
Servicer nor the Trustee shall be obligated to substitute for or replace the Limited
Guaranty or Subordinate Certificate Loss Obligation under any circumstance.
Section 12.02. Amendments Relating to the Limited Guaranty. Notwithstanding
Sections 11.01 or 12.01: (i) the provisions of this Article XII may be amended, superseded
or deleted, (ii) the Limited Guaranty or Subordinate Certificate Loss Obligation may be
amended, reduced or canceled, and (iii) any other provision of this Agreement which is
related or incidental to the matters described in this Article XII may be amended in any
manner; in each case by written instrument executed or consented to by the Depositor and
Residential Funding but without the consent of any Certificateholder and without the consent
of the Master Servicer or the Trustee being required unless any such amendment would impose
any additional obligation on, or otherwise adversely affect the interests of, the Master
Servicer or the Trustee, as applicable; provided that the Depositor shall also obtain a
letter from each nationally recognized credit rating agency that rated the Class B
Certificates at the request of the Depositor to the effect that such amendment, reduction,
deletion or cancellation will not lower the rating on the Class B Certificates below the
lesser of (a) the then-current rating assigned to the Class B Certificates by such rating
agency and (b) the original rating assigned to the Class B Certificates by such rating
agency, unless (A) the Holder of 100% of the Class B Certificates is Residential Funding or
an Affiliate of Residential Funding, or (B) such amendment, reduction, deletion or
cancellation is made in accordance with Section 11.01(e) and, provided further that the
Depositor obtains (subject to the provisions of Section 10.01(f) as if the Depositor was
substituted for the Master Servicer solely for the purposes of such provision), in the case
of a material amendment or supersession (but not a reduction, cancellation or deletion of
the Limited Guaranty or the Subordinate Certificate Loss Obligation), an Opinion of Counsel
(which need not be an opinion of Independent counsel) to the effect that any such amendment
or supersession will not cause either (a) any federal tax to be imposed on the Trust Fund,
including without limitation, any federal tax imposed on prohibited transactions under
Section 860F(a)(1) of the Code or on contributions after the startup date under Section
860G(d)(1) of the Code or (b) the Trust Fund to fail to qualify as a REMIC at any time that
any Certificate is outstanding. A copy of any such instrument shall be provided to the
Trustee and the Master Servicer together with an Opinion of Counsel that such amendment
complies with this Section 12.02.
EXHIBIT M
FORM OF LIMITED GUARANTY
RESIDENTIAL ASSET MORTGAGE PRODUCTS, INC.
Mortgage Asset-Backed Pass-Through Certificates
Series 2005-SP3
_______, 200__
JPMorgan Chase Bank, N.A.
▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Residential Asset Mortgage Products, Inc., Series 2005-SP3
Ladies and Gentlemen:
WHEREAS, Residential Funding Corporation, a Delaware corporation (Residential
Funding), an indirect wholly-owned subsidiary of General Motors Acceptance Corporation, a
New York corporation (GMAC), plans to incur certain obligations as described under Section
12.01 of the Pooling and Servicing Agreement dated as of December 1, 2005, (the Servicing
Agreement), among Residential Asset Mortgage Products, Inc. (the Depositor), Residential
Funding and JPMorgan Chase Bank (the Trustee) as amended by Amendment No. ___ thereto,
dated as of ________, with respect to the Mortgage Asset-Backed Pass-Through Certificates,
Series 2005-SP3 (the Certificates); and
WHEREAS, pursuant to Section 12.01 of the Servicing Agreement, Residential
Funding agrees to make payments to the Holders of the Class B Certificates with respect to
certain losses on the Mortgage Loans as described in the Servicing Agreement; and
WHEREAS, GMAC desires to provide certain assurances with respect to the
ability of Residential Funding to secure sufficient funds and faithfully to perform its
Subordinate Certificate Loss Obligation;
NOW THEREFORE, in consideration of the premises herein contained and certain
other good and valuable consideration, the receipt of which is hereby acknowledged, GMAC
agrees as follows:
1. Provision of Funds. (a) GMAC agrees to contribute and deposit in the
Certificate Account on behalf of Residential Funding (or otherwise provide to Residential
Funding, or to cause to be made available to Residential Funding), either directly or
through a subsidiary, in any case prior to the related Distribution Date, such moneys as may
be required by Residential Funding to perform its Subordinate Certificate Loss Obligation
when and as the same arises from time to time upon the demand of the Trustee in accordance
with Section 12.01 of the Servicing Agreement.
(b) The agreement set forth in the preceding clause (a) shall be absolute,
irrevocable and unconditional and shall not be affected by the transfer by GMAC or any other
person of all or any part of its or their interest in Residential Funding, by any
insolvency, bankruptcy, dissolution or other proceeding affecting Residential Funding or any
other person, by any defense or right of counterclaim, set-off or recoupment that GMAC may
have against Residential Funding or any other person or by any other fact or circumstance.
Notwithstanding the foregoing, GMACs obligations under clause (a) shall terminate upon the
earlier of (x) substitution for this Limited Guaranty pursuant to Section 12.01(f) of the
Servicing Agreement, or (y) the termination of the Trust Fund pursuant to the Servicing
Agreement.
2. Waiver. GMAC hereby waives any failure or delay on the part of
Residential Funding, the Trustee or any other person in asserting or enforcing any rights or
in making any claims or demands hereunder. Any defective or partial exercise of any such
rights shall not preclude any other or further exercise of that or any other such right.
GMAC further waives demand, presentment, notice of default, protest, notice of acceptance
and any other notices with respect to this Limited Guaranty, including, without limitation,
those of action or nonaction on the part of Residential Funding or the Trustee.
3. Modification, Amendment and Termination. This Limited Guaranty may be
modified, amended or terminated only by the written agreement of GMAC and the Trustee and
only if such modification, amendment or termination is permitted under Section 12.02 of the
Servicing Agreement. The obligations of GMAC under this Limited Guaranty shall continue and
remain in effect so long as the Servicing Agreement is not modified or amended in any way
that might affect the obligations of GMAC under this Limited Guaranty without the prior
written consent of GMAC.
4. Successor. Except as otherwise expressly provided herein, the
guarantee herein set forth shall be binding upon GMAC and its respective successors.
5. Governing Law. This Limited Guaranty shall be governed by the laws of
the State of New York without regard to the conflicts of law principles thereof, other than
Sections 5 1401 and 5 1402 of the New York General Obligations Law.
6. Authorization and Reliance. GMAC understands that a copy of this
Limited Guaranty shall be delivered to the Trustee in connection with the execution of
Amendment No. 1 to the Servicing Agreement and GMAC hereby authorizes the Depositor and the
Trustee to rely on the covenants and agreements set forth herein.
7. Definitions. Capitalized terms used but not otherwise defined herein
shall have the meaning given them in the Servicing Agreement.
8. Counterparts. This Limited Guaranty may be executed in any number of
counterparts, each of which shall be deemed to be an original and such counterparts shall
constitute but one and the same instrument.
IN WITNESS WHEREOF, GMAC has caused this Limited Guaranty to be executed and
delivered by its respective officers thereunto duly authorized as of the day and year first
above written.
GENERAL MOTORS ACCEPTANCE
CORPORATION
By:...............................................
Name:.............................................
Title:............................................
Acknowledged by:
JPMORGAN CHASE BANK, N.A.
as Trustee
By:______________________________________
Name:___________________________________
Title:___________________________________
RESIDENTIAL FUNDING CORPORATION
By:______________________________________
Name:___________________________________
Title:___________________________________
EXHIBIT N
FORM OF LENDER CERTIFICATION FOR ASSIGNMENT OF MORTGAGE LOAN
__________________, 20____
Residential Asset Mortgage
Products, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
JPMorgan Chase Bank, N.A.
4 New York Plaza, 6th Floor
New York, New York 10004
Attention: Residential Asset Mortgage Products, Inc., Series 2005-SP3
Re: Mortgage Asset-Backed Pass-Through Certificates, Series 2005-SP3
Assignment of Mortgage Loan
Ladies and Gentlemen:
This letter is delivered to you in connection with the assignment by
_________________ (the Trustee) to _______________________ (the Lender) of
_______________ (the Mortgage Loan) pursuant to Section 3.13(d) of the Pooling and
Servicing Agreement (the Pooling and Servicing Agreement), dated as of December 1, 2005,
among Residential Asset Mortgage Products, Inc., as seller (the Depositor), Residential
Funding Corporation, as master servicer, and the Trustee. All terms used herein and not
otherwise defined shall have the meanings set forth in the Pooling and Servicing Agreement.
The Lender hereby certifies, represents and warrants to, and covenants with, the Master
Servicer and the Trustee that:
(i)....the Mortgage Loan is secured by Mortgaged Property located in a jurisdiction
in which an assignment in lieu of satisfaction is required to preserve lien priority,
minimize or avoid mortgage recording taxes or otherwise comply with, or facilitate a
refinancing under, the laws of such jurisdiction;
(ii)...the substance of the assignment is, and is intended to be, a refinancing of
such Mortgage Loan and the form of the transaction is solely to comply with, or facilitate
the transaction under, such local laws;
(iii)..the Mortgage Loan following the proposed assignment will be modified to have a
rate of interest at least 0.25 percent below or above the rate of interest on such Mortgage
Loan prior to such proposed assignment; and
(iv)...such assignment is at the request of the borrower under the related Mortgage
Loan.
Very truly yours,
_________________________________
(Lender)
By:______________________________
Name:___________________________
Title:____________________________
EXHIBIT O
FORM OF RULE 144A INVESTMENT REPRESENTATION
Description of Rule 144A Securities, including numbers:
_______________________________________________
_______________________________________________
_______________________________________________
_______________________________________________
The undersigned seller, as registered holder (the Seller), intends to
transfer the Rule 144A Securities described above to the undersigned buyer (the Buyer).
1. In connection with such transfer and in accordance with the agreements
pursuant to which the Rule 144A Securities were issued, the Seller hereby certifies the
following facts: Neither the Seller nor anyone acting on its behalf has offered,
transferred, pledged, sold or otherwise disposed of the Rule 144A Securities, any interest
in the Rule 144A Securities or any other similar security to, or solicited any offer to buy
or accept a transfer, pledge or other disposition of the Rule 144A Securities, any interest
in the Rule 144A Securities or any other similar security from, or otherwise approached or
negotiated with respect to the Rule144A Securities, any interest in the Rule144A
Securities or any other similar security with, any person in any manner, or made any general
solicitation by means of general advertising or in any other manner, or taken any other
action, that would constitute a distribution of the Rule 144A Securities under the
Securities Act of 1933, as amended (the 1933 Act), or that would render the disposition of
the Rule 144A Securities a violation of Section 5 of the 1933 Act or require registration
pursuant thereto, and that the Seller has not offered the Rule 144A Securities to any person
other than the Buyer or another qualified institutional buyer as defined in Rule 144A
under the ▇▇▇▇ ▇▇▇.
2. The Buyer warrants and represents to, and covenants with, the Seller, the
Trustee and the Master Servicer (as defined in the Pooling and Servicing Agreement (the
Agreement), dated as of December 1, 2005, among Residential Funding Corporation as Master
Servicer, Residential Asset Mortgage Products, Inc. as depositor pursuant to Section 5.02 of
the Agreement and JPMorgan Chase Bank, N.A., as trustee, as follows:
a. The Buyer understands that the Rule 144A Securities have not been
registered under the 1933 Act or the securities laws of any state.
b. The Buyer considers itself a substantial, sophisticated
institutional investor having such knowledge and experience in financial and business
matters that it is capable of evaluating the merits and risks of investment in the
Rule 144A Securities.
c. The Buyer has been furnished with all information regarding the
Rule 144A Securities that it has requested from the Seller, the Trustee or the Master
Servicer.
d. Neither the Buyer nor anyone acting on its behalf has offered,
transferred, pledged, sold or otherwise disposed of the Rule 144A Securities, any
interest in the Rule 144A Securities or any other similar security to, or solicited
any offer to buy or accept a transfer, pledge or other disposition of the Rule 144A
Securities, any interest in the Rule 144A Securities or any other similar security
from, or otherwise approached or negotiated with respect to the Rule 144A Securities,
any interest in the Rule 144A Securities or any other similar security with, any
person in any manner, or made any general solicitation by means of general
advertising or in any other manner, or taken any other action, that would constitute
a distribution of the Rule 144A Securities under the 1933 Act or that would render
the disposition of the Rule 144A Securities a violation of Section 5 of the 1933 Act
or require registration pursuant thereto, nor will it act, nor has it authorized or
will it authorize any person to act, in such manner with respect to the Rule 144A
Securities.
e. The Buyer is a qualified institutional buyer as that term is
defined in Rule 144A under the 1933 Act and has completed either of the forms of
certification to that effect attached hereto as Annex 1 or Annex 2. The Buyer is
aware that the sale to it is being made in reliance on Rule 144A. The Buyer is
acquiring the Rule 144A Securities for its own account or the accounts of other
qualified institutional buyers, understands that such Rule 144A Securities may be
resold, pledged or transferred only (i) to a person reasonably believed to be a
qualified institutional buyer that purchases for its own account or for the account
of a qualified institutional buyer to whom notice is given that the resale, pledge or
transfer is being made in reliance on Rule 144A, or (ii) pursuant to another
exemption from registration under the 1933 Act.
3. The Buyer
a. is not an employee benefit plan or other plan subject to the
prohibited transaction provisions of the Employee Retirement Income Security Act of
1974, as amended (ERISA), or Section 4975 of the Internal Revenue Code of 1986, as
amended (the Code) (each, an ERISA Plan), or any person (including an insurance
company investing its general accounts, an investment manager, a named fiduciary or a
trustee of any ERISA Plan) who is using plan assets, within the meaning of the U.S.
Department of Labor (DOL) regulation promulgated at 29 C.F.R. 2510.3 101, of any
ERISA Plan (each, an ERISA Plan Investor), to effect such acquisition; or
b. in the case of Class B Certificates, the Buyer is an insurance
company, the source of funds used to purchase or hold the Certificates (or any
interest therein) is an insurance company general account (as defined in DOL
Prohibited Transaction Class Exemption (PTCE) 95-60), and the conditions set forth
in Sections I and III PTCE 95-60 have been satisfied; or
[c.] has provided the Trustee, the Depositor and the Master Servicer
with an opinion of counsel acceptable to and in form and substance satisfactory to
the Trustee, the Depositor and the Master Servicer to the effect that the purchase
and holding of the Certificates is permissible under applicable law, will not
constitute or result in any non-exempt prohibited transaction under Section 406 of
ERISA or Section 4975 of the Code (or comparable provisions of any subsequent
provisions) and will not subject the Trustee, the Depositor or the Master Servicer to
any obligation or liability (including obligations or liabilities under ERISA or
Section 4975 of the Code) in addition to those undertaken in the Pooling and
Servicing Agreement which opinion of counsel shall not be an expense of the Trustee,
the Depositor or the Master Servicer.
4. This document may be executed in one or more counterparts and by the
different parties hereto on separate counterparts, each of which, when so executed, shall be
deemed to be an original; such counterparts, together, shall constitute one and the same
document.
IN WITNESS WHEREOF, each of the parties has executed this document as of the
date set forth below.
_________________________________ ___________________________________
Print Name of Seller Print Name of Buyer
By:______________________________ By:______________________________
Name:___________________________ Name:___________________________
Title____________________________ Title____________________________
Taxpayer Identification No.:_____________ Taxpayer Identification No.:_____________
Date:_______________________________ Date:_______________________________
ANNEX 1 TO EXHIBIT O
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Buyers Other Than Registered Investment Companies]
The undersigned hereby certifies as follows in connection with the Rule 144A
Investment Representation to which this Certification is attached:
1. As indicated below, the undersigned is the President, Chief Financial Officer,
Senior Vice President or other executive officer of the Buyer.
2. In connection with purchases by the Buyer, the Buyer is a qualified institutional
buyer as that term is defined in Rule 144A under the Securities Act of 1933 (Rule 144A)
because (i) the Buyer owned and/or invested on a discretionary basis $______________________
in securities (except for the excluded securities referred to below) as of the end of the
Buyers most recent fiscal year (such amount being calculated in accordance with Rule 144A)
and (ii) the Buyer satisfies the criteria in the category marked below.
___ Corporation, etc. The Buyer is a corporation (other than a bank, savings and loan
association or similar institution), Massachusetts or similar business trust,
partnership, or charitable organization described in Section 501(c)(3) of the
Internal Revenue Code.
___ Bank. The Buyer (a) is a national bank or banking institution organized under the
laws of any State, territory or the District of Columbia, the business of which is
substantially confined to banking and is supervised by the State or territorial
banking commission or similar official or is a foreign bank or equivalent
institution, and (b) has an audited net worth of at least $25,000,000 as demonstrated
in its latest annual financial statements, a copy of which is attached hereto.
___ Savings and Loan. The Buyer (a) is a savings and loan association, building and loan
association, cooperative bank, homestead association or similar institution, which is
supervised and examined by a State or Federal authority having supervision over any
such institutions or is a foreign savings and loan association or equivalent
institution and (b) has an audited net worth of at least $25,000,000 as demonstrated
in its latest annual financial statements.
___ Broker-Dealer. The Buyer is a dealer registered pursuant to Section 15 of the
Securities Exchange Act of 1934.
___ Insurance Company. The Buyer is an insurance company whose primary and predominant
business activity is the writing of insurance or the reinsuring of risks underwritten
by insurance companies and which is subject to supervision by the insurance
commissioner or a similar official or agency of a State or territory or the District
of Columbia.
___ State or Local Plan. The Buyer is a plan established and maintained by a State, its
political subdivisions, or any agency or instrumentality of the State or its
political subdivisions, for the benefit of its employees.
___ ERISA Plan. The Buyer is an employee benefit plan within the meaning of Title I of
the Employee Retirement Income Security Act of 1974.
___ Investment Adviser. The Buyer is an investment adviser registered under the
Investment Advisers Act of 1940.
___ SBIC. The Buyer is a Small Business Investment Company licensed by the U.S. Small
Business Administration under Section301(c) or (d) of the Small Business Investment
Act of 1958.
___ Business Development Company. The Buyer is a business development company as defined
in Section202(a)(22) of the Investment Advisers Act of 1940.
___ Trust Fund. The Buyer is a trust fund whose trustee is a bank or trust company and
whose participants are exclusively (a) plans established and maintained by a State,
its political subdivisions, or any agency or instrumentality of the State or its
political subdivisions, for the benefit of its employees, or (b)employee benefit
plans within the meaning of Title I of the Employee Retirement Income Security Act of
1974, but is not a trust fund that includes as participants individual retirement
accounts or H.R. 10 plans.
3. The term securities as used herein does not include (i) securities of
issuers that are affiliated with the Buyer, (ii) securities that are part of an unsold
allotment to or subscription by the Buyer, if the Buyer is a dealer, (iii) bank deposit
notes and certificates of deposit, (iv) loan participations, (v) repurchase agreements, (vi)
securities owned but subject to a repurchase agreement and (vii) currency, interest rate and
commodity swaps.
4. For purposes of determining the aggregate amount of securities owned and/or
invested on a discretionary basis by the Buyer, the Buyer used the cost of such securities
to the Buyer and did not include any of the securities referred to in the preceding
paragraph. Further, in determining such aggregate amount, the Buyer may have included
securities owned by subsidiaries of the Buyer, but only if such subsidiaries are
consolidated with the Buyer in its financial statements prepared in accordance with
generally accepted accounting principles and if the investments of such subsidiaries are
managed under the Buyers direction. However, such securities were not included if the
Buyer is a majority-owned, consolidated subsidiary of another enterprise and the Buyer is
not itself a reporting company under the Securities Exchange Act of 1934.
5. The Buyer acknowledges that it is familiar with Rule 144A and understands that
the seller to it and other parties related to the Certificates are relying and will continue
to rely on the statements made herein because one or more sales to the Buyer may be in
reliance on Rule 144A.
___ ___ Will the Buyer be purchasing the Rule 144A
Yes No Securities only for the Buyers own account?
6. If the answer to the foregoing question is no, the Buyer agrees that, in
connection with any purchase of securities sold to the Buyer for the account of a third
party (including any separate account) in reliance on Rule 144A, the Buyer will only
purchase for the account of a third party that at the time is a qualified institutional
buyer within the meaning of Rule 144A. In addition, the Buyer agrees that the Buyer will
not purchase securities for a third party unless the Buyer has obtained a current
representation letter from such third party or taken other appropriate steps contemplated by
Rule 144A to conclude that such third party independently meets the definition of qualified
institutional buyer set forth in Rule 144A.
7. The Buyer will notify each of the parties to which this certification is made
of any changes in the information and conclusions herein. Until such notice is given, the
Buyers purchase of Rule 144A Securities will constitute a reaffirmation of this
certification as of the date of such purchase.
__________________________________________
Print Name of Buyer
By:_______________________________________
Name:
Title:
Date:_____________________________________
ANNEX 2 TO EXHIBIT O
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Buyers That Are Registered Investment Companies]
The undersigned hereby certifies as follows in connection with the Rule 144A
Investment Representation to which this Certification is attached:
1. As indicated below, the undersigned is the President, Chief Financial
Officer or Senior Vice President of the Buyer or, if the Buyer is a qualified institutional
buyer as that term is defined in Rule144A under the Securities Act of 1933 (Rule144A)
because Buyer is part of a Family of Investment Companies (as defined below), is such an
officer of the Adviser.
2. In connection with purchases by Buyer, the Buyer is a qualified
institutional buyer as defined in SEC Rule144A because (i) the Buyer is an investment
company registered under the Investment Company Act of 1940, and (ii) as marked below, the
Buyer alone, or the Buyers Family of Investment Companies, owned at least $100,000,000 in
securities (other than the excluded securities referred to below) as of the end of the
Buyers most recent fiscal year. For purposes of determining the amount of securities owned
by the Buyer or the Buyers Family of Investment Companies, the cost of such securities was
used.
____ The Buyer owned $___________________ in securities (other than the excluded
securities referred to below) as of the end of the Buyers most recent fiscal
year (such amount being calculated in accordance with Rule144A).
____ The Buyer is part of a Family of Investment Companies which owned in the
aggregate $______________ in securities (other than the excluded securities
referred to below) as of the end of the Buyers most recent fiscal year (such
amount being calculated in accordance with Rule144A).
3. The term Family of Investment Companies as used herein means two or
more registered investment companies (or series thereof) that have the same investment
adviser or investment advisers that are affiliated (by virtue of being majority owned
subsidiaries of the same parent or because one investment adviser is a majority owned
subsidiary of the other).
4. The term securities as used herein does not include (i) securities of
issuers that are affiliated with the Buyer or are part of the Buyers Family of Investment
Companies, (ii) bank deposit notes and certificates of deposit, (iii) loan participations,
(iv) repurchase agreements, (v) securities owned but subject to a repurchase agreement and
(vi) currency, interest rate and commodity swaps.
5. The Buyer is familiar with Rule144A and understands that each of the
parties to which this certification is made are relying and will continue to rely on the
statements made herein because one or more sales to the Buyer will be in reliance on
Rule144A. In addition, the Buyer will only purchase for the Buyers own account.
6. The undersigned will notify each of the parties to which this
certification is made of any changes in the information and conclusions herein. Until such
notice, the Buyers purchase of Rule 144A Securities will constitute a reaffirmation of this
certification by the undersigned as of the date of such purchase.
_______________________________________
Print Name of Buyer
By:____________________________________
Name:_________________________________
Title:__________________________________
IF AN ADVISER:
______________________________________
Print Name of Buyer
Date:_________________________________
EXHIBIT P
[Reserved]
EXHIBIT Q
FORM OF ERISA REPRESENTATION LETTER (CLASS M CERTIFICATES)
______________, 20__
Residential Asset Mortgage Products, Inc
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
JPMorgan Chase Bank, N.A.
▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Residential Funding Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Residential Funding Corporation Series 2005-SP3
Re: Mortgage Asset-Backed Pass-Through Certificates,
Series 2005-SP3, Class M-[_]
Ladies and Gentlemen:
_________________________ (the Purchaser) intends to purchase from
___________________________ (the Seller) $_____________ Initial Certificate Principal
Balance of Mortgage Asset-Backed Pass-Through Certificates, Series 2005-SP3, Class __ (the
Certificates), issued pursuant to the Pooling and Servicing Agreement (the Pooling and
Servicing Agreement), dated as of December 1, 2005, among Residential Asset Mortgage
Products, Inc., as seller (the Company), Residential Funding Corporation, as master
servicer (the Master Servicer) and JPMorgan Chase Bank, N.A., as trustee (the Trustee).
All terms used herein and not otherwise defined shall have the meanings set forth in the
Pooling and Servicing Agreement. The Purchaser hereby certifies, represents and warrants
to, and covenants with, the Company, the Trustee and the Master Servicer that:
(a) the Purchaser is not an employee benefit plan or other plan
subject to the prohibited transaction provisions of the Employee Retirement Income
Security Act of 1974, as amended (ERISA), or Section 4975 of the Internal Revenue
Code of 1986, as amended (the Code) (each an ERISA Plan), or any person
(including an insurance company investing its general accounts, an investment
manager, a named fiduciary or a trustee of any ERISA Plan) who is using plan
assets, within the meaning of the U.S. Department of Labor (DOL) regulation
promulgated at 29 C.F.R. 2510.3-101, of any ERISA Plan (each, an ERISA Plan
Investor) to effect such acquisition.
(b) The Purchaser is an insurance company; the source of the funds
used to purchase or hold the Certificates (or any interest therein) is an insurance
company general account (as defined in DOL Prohibited Transaction Class Exemption
(PTCE) 95-60); and the conditions set forth in Sections I and III of PTCE 95-60
have been satisfied; or
(c) The Purchaser has provided the Trustee, the Company and the Master
Servicer with an opinion of counsel acceptable to and in form and substance
satisfactory to the Trustee, the Company and the Master Servicer to the effect that
the purchase and holding of the Certificates is permissible under applicable law,
will not constitute or result in any non-exempt prohibited transaction under Section
406 of ERISA or Section 4975 of the Code (or comparable provisions of any subsequent
enactments) and will not subject the Trustee, the Company or the Master Servicer to
any obligation or liability (including obligations or liabilities under ERISA or
Section 4975 of the Code) in addition to those undertaken in the Pooling and
Servicing Agreement which opinion of counsel shall not be an expense of the Trustee,
the Company or the Master Servicer.
In addition, the Purchaser hereby certifies, represents and warrants to, and
covenants with, the Company, the Trustee and the Master Servicer that the Purchaser will not
transfer such Certificates to any transferee unless such transferee meets the requirements
set forth in either (a), (b) or (c) above.
Very truly yours,
_______________________________________
(Purchaser)
By:...............................................
Name:.............................................
Title:............................................
EXHIBIT R-1
FORM OF FORM 10-K CERTIFICATION
I, [identify the certifying individual], certify that:
1......I have reviewed the annual report on Form 10-K for the fiscal year [___], and
all reports on Form 8-K containing distribution or servicing reports filed in respect of
periods included in the year covered by that annual report, of the trust (the Trust)
created pursuant to the Pooling and Servicing Agreement dated __________ (the Agreement)
among Residential Asset Mortgage Products, Inc. (the Depositor), Residential Funding
Corporation (the Master Servicer) and JPMorgan Chase Bank, N.A. (the Trustee);
2......Based on my knowledge, the information in these reports, taken as a whole,
does not contain any untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances under which such
statements were made, not misleading as of the last day of the period covered by this annual
report;
3......Based on my knowledge, the servicing information required to be provided to
the Trustee by the Master Servicer under the Agreement for inclusion in these reports is
included in these reports;
4......I am responsible for reviewing the activities performed by the Master Servicer
under the Agreement and based upon my knowledge and the annual compliance review required
under the Agreement, and except as disclosed in the report, the Master Servicer has
fulfilled its obligations under the Agreement; and
5......The reports disclose all significant deficiencies relating to the Master
Servicers compliance with the minimum servicing standards based upon the report provided by
an independent public accountant, after conducting a review in compliance with the Uniform
Single Attestation Program for Mortgage Bankers as set forth in the Agreement, that is
included in these reports.
In giving the certifications above, I have reasonably relied on the information
provided to me by the following unaffiliated parties: [the Trustee].
Date:____________
_________________________________*
[Signature]
Name:
Title:
* - to be signed by the senior officer in charge of the servicing functions of the Master
Servicer
EXHIBIT R-2
FORM OF BACK-UP CERTIFICATION TO FORM 10-K CERTIFICATE
The undersigned, a Responsible Officer of JPMorgan Chase Bank, N.A. (the Trustee)
certifies that:
1......The Trustee has performed all of the duties specifically required to be
performed by it pursuant to the provisions of the Pooling and Servicing Agreement dated
_________ (the Agreement) by and among Residential Asset Mortgage Products, Inc. (the
Depositor), Residential Funding Corporation (the Master Servicer) and the Trustee in
accordance with the standards set forth therein.
2......Based on my knowledge, the list of Certificateholders as shown on the
Certificate Register as of the end of each calendar year that is provided by the Trustee
pursuant to Section 4.03(d) of the Agreement is accurate as of the last day of the 20___
calendar year.
Capitalized terms used and not defined herein shall have the meanings given such
terms in the Agreement.
IN WITNESS THEREOF, I have duly executed this certificate as of _________, 20___
Name:
Title:
EXHIBIT S
INFORMATION TO BE PROVIDED BY THE MASTER SERVICER TO THE RATING AGENCIES RELATING TO
REPORTABLE MODIFIED MORTGAGE LOANS
Account number
Transaction Identifier
Unpaid Principal Balance prior to Modification
Next Due Date
Monthly Principal and Interest Payment
Total Servicing Advances
Current Interest Rate
Original Maturity Date
Original Term to Maturity (Months)
Remaining Term to Maturity (Months)
Trial Modification Indicator
Mortgagor Equity Contribution
Total Servicer Advances
Trial Modification Terms (Months)
Trial Modification Start Date
Trial Modification End Date
Trial Modification Period Principal and Interest Payment
Trial Modification Interest Rate
Trial Modification Term
Rate Reduction Indicator
Interest Rate Post Modification
Rate Reduction Start Date
Rate Reduction End Date
Rate Reduction Term
Term Modified Indicator
Modified Amortization Period
Modified Final Maturity Date
Total Advances Written Off
Unpaid Principal Balance Written Off
Other Past Due Amounts Written Off
Write Off Date
Unpaid Principal Balance Post Write Off
Capitalization Indicator
Mortgagor Contribution
Total Capitalized Amount
Modification Close Date
Unpaid Principal Balance Post Capitalization Modification
Next Payment Due Date per Modification Plan
Principal and Interest Payment Post Modification
Interest Rate Post Modification
Payment Made Post Capitalization
Delinquency Status to Modification Plan
EXHIBIT T
[Reserved]
EXHIBIT U
FORM OF YIELD MAINTENANCE AGREEMENT
[To Be Inserted]