DATE: October 30, 2006
TO: Deutsche Bank Trust Company Americas, not in its
individual capacity but solely as Supplemental
Interest Trust Trustee for the benefit of RALI
Series 2006-QA9 Supplemental Interest Trust, acting
on behalf of the Class A Certificateholders and the
Class M Certificateholders under the Pooling and
Servicing Agreement identified below ("PARTY A")
ATTENTION: RALI Series 2006-QA9
FROM: Deutsche Bank Trust Company Americas, not in its
individual capacity but solely as Supplemental
Interest Trust Trustee for the benefit of RALI
Series 2006-QA9 Supplemental Interest Trust, acting
on behalf of the Class SB Certificateholders under
the Pooling and Servicing Agreement identified below
("PARTY B")
SUBJECT: Payment Swap Confirmation and Agreement
REFERENCE NUMBER
The purpose of this letter agreement (the "Agreement") is to confirm the terms
and conditions of the Transaction entered into on the Trade Date specified below
(the "Transaction") between Party A and Party B. This Agreement, which evidences
a complete and binding agreement between you and us to enter into the
Transaction on the terms set forth below, constitutes a "Confirmation" as
referred to in the ISDA Form Master Agreement (as defined below), as well as a
"Schedule" as referred to in the ISDA Form Master Agreement.
1. This Agreement is subject to and incorporates the 2000 ISDA Definitions (the
"Definitions"), as published by the International Swaps and Derivatives
Association, Inc. ("ISDA"). You and we have agreed to enter into this Agreement
in lieu of negotiating a Schedule to the 1992 ISDA Master Agreement
1
(Multicurrency-Cross Border) form (the "ISDA Form Master Agreement") but,
rather, an ISDA Form Master Agreement shall be deemed to have been executed by
you and us on the date we entered into the Transaction. In the event of any
inconsistency between the provisions of this Agreement and the Definitions or
the ISDA Form Master Agreement, this Agreement shall prevail for purposes of the
Transaction. Terms used and not otherwise defined herein, in the ISDA Form
Master Agreement or the Definitions shall have the meanings assigned to them in
the series supplement (the "Series Supplement"), dated as of October 30, 2006,
to the standard terms of pooling and servicing agreement, dated as of October
30, 2006 (the "Standard Terms", and together with the Series Supplement, the
"Pooling and Servicing Agreement"), among Residential Accredit Loans, Inc., as
depositor, Residential Funding Company, LLC, as master servicer, and Deutsche
Bank Trust Company Americas, as trustee. Each reference to a "Section" or to a
"Section" "of this Agreement" will be construed as a reference to a Section of
the 1992 ISDA Form Master Agreement. Each capitalized term used herein that is
not defined herein or in the 1992 ISDA Form Master Agreement shall have the
meaning defined in the Pooling and Servicing Agreement. Notwithstanding anything
herein to the contrary, should any provision of this Agreement conflict with any
provision of the Pooling and Servicing Agreement, the provision of the Pooling
and Servicing Agreement shall apply.
2. The terms of the particular Transaction to which this Confirmation relates
are as follows:
Trade Date:
Effective Date:
Termination Date: November 25, 2036 subject to adjustment
in accordance with the Business Day
Convention.
Business Days: California, Minnesota, Texas, New York,
Illinois.
Business Day Convention: Following.
PARTY A PAYMENTS:
Party A Payment Dates: Each Distribution Date under the Pooling
and Servicing Agreement.
Party A Payment Amounts: On each Party A Payment Date, the
amount, if any, equal to the aggregate
amount of Net Swap Payments and Swap
Termination Payments owed to the Swap
Counterparty remaining unpaid after
application of the sum of (A) from the
Adjusted Available Distribution Amount
that would have remained had the
Adjusted Available Distribution Amount
been applied on such Distribution Date
to make the distributions for such
Distribution Date under Section 4.02(c)
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clauses (i) through (x) of the Pooling
and Servicing Agreement, of (I) Accrued
Certificate Interest on the Class SB
Certificates, (II) the amount of any
Overcollateralization Reduction Amount
and (III) for each Distribution Date
after the Certificate Principal Balance
of each Class of Class A Certificates
and Class M Certificates has been
reduced to zero, the
Overcollateralization Amount, (B) from
prepayment charges on deposit in the
Certificate Amount, any prepayment
charges received on the Mortgage Loans
during the related Prepayment Period and
(C) from the amount distributable with
respect to the REMIC III Regular
Interest IO.
PARTY B PAYMENTS:
Party B Payment Dates: Each Distribution Date under the Pooling
and Servicing Agreement
Party B Payment Amounts: On each Party B Payment Date, an amount
equal to the lesser of (a) the Available
Distribution Amount remaining on such
Distribution Date after the
distributions on such Distribution Date
under Section 4.02(c) clauses (i)
through (vi) of the Pooling and
Servicing Agreement and (b) the
aggregate unpaid Basis Risk Shortfalls
allocated to the Class A
Certificateholders and the Class M
Certificateholders for such Distribution
Date.
3. Additional Provisions: Each party hereto is hereby advised and acknowledges
that the other party has engaged in (or refrained from engaging in) substantial
financial transactions and has taken (or refrained from taking) other material
actions in reliance upon the entry by the parties into the Transaction being
entered into on the terms and conditions set forth herein and in the ISDA Form
Master Agreement relating to such Transaction, as applicable.
4. Provisions Deemed Incorporated in a Schedule to the ISDA Form Master
Agreement:
1) Termination Provisions. For purposes of the ISDA Form
Master Agreement:
(a) "Specified Entity" is not applicable to Party
A or Party B for any purpose.
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(b) "Specified Transaction" is not applicable to
Party A or Party B for any purpose, and, accordingly,
Section 5(a)(v) shall not apply to Party A or Party B.
(c) The "Cross Default" provisions of Section
5(a)(vi) shall not apply to Party A or Party B.
(d) The "Credit Event Upon Merger" provisions of
Section 5(b)(iv) will not apply to Party A or Party B.
(e) With respect to Party A and Party B, the
"Bankruptcy" provision of Section 5(a)(vii)(2) of the ISDA
Form Master Agreement will be deleted in its entirety.
(f) The "Automatic Early Termination" provision of
Section 6(a) will not apply to Party A or to Party B.
(g) Payments on Early Termination. For the purpose
of Section 6(e) of the ISDA Form Master Agreement:
(i) Market Quotation will apply.
(ii) The Second Method will apply.
(h) "Termination Currency" means United States
Dollars.
(i) The provisions of Sections 5(a)(ii), 5(a)(iii)
and 5(a)(iv) shall not apply to Party A or Party B.
(j) Tax Event. The provisions of Section
2(d)(i)(4) and 2(d)(ii) of the ISDA Form Master Agreement
shall not apply to Party A and Party A shall not be required
to pay any additional amounts referred to therein.
2) Tax Representations.
(a) Payer Representations. For the purpose of
Section 3(e) of the ISDA Form Master Agreement, each of
Party A and Party B will make the following representations:
It is not required by any applicable law, as
modified by the practice of any relevant
governmental revenue authority, of any Relevant
Jurisdiction to make any deduction or withholding
for or on account of any Tax from any payment
(other than interest under Section 2(e), 6(d)(ii)
or 6(e) of the ISDA Form Master Agreement) to be
made by it to the other party under this Agreement.
In making this representation, it may rely on:
4
(i) the accuracy of any representations
made by the other party pursuant to Section 3(f)
of the ISDA Form Master Agreement;
(ii) the satisfaction of the agreement
contained in Sections 4(a)(i) or 4(a)(iii) of the
ISDA Form Master Agreement and the accuracy and
effectiveness of any document provided by the
other party pursuant to Sections 4(a)(i) or
4(a)(iii) of the ISDA Form Master Agreement; and
(iii) the satisfaction of the agreement
of the other party contained in Section 4(d) of
the ISDA Form Master Agreement, provided that it
shall not be a breach of this representation where
reliance is placed on clause (ii) and the other
party does not deliver a form or document under
Section 4(a)(iii) by reason of material prejudice
to its legal or commercial position.
(b) Payee Representations. For the purpose of
Section 3(f) of the ISDA Form Master Agreement, Party A and
Party B make the following representations: None
3) Documents to be Delivered. For the purpose of Section
4(a) (i) and 4(a) (iii):
(1) Tax forms, documents, or certificates to be
delivered are:
PARTY REQUIRED TO FORM/DOCUMENT/ DATE BY WHICH TO
DELIVER DOCUMENT CERTIFICATE BE DELIVERED
Party A and Party B Any documents required Promptly after the earlier
or reasonably requested of (i) reasonable demand by
to allow the other party either party or (ii) learning
to make payments under that such form or document
this Agreement without is required
any deduction or
withholding for or on
the account of any Tax
or with such deduction
or withholding at a
reduced rate
5
(2) Other documents to be delivered are:
PARTY REQUIRED FORM/DOCUMENT/ DATE BY WHICH TO COVERED BY
TO DELIVER CERTIFICATE BE DELIVERED SECTION 3(D)
DOCUMENT REPRESENTATION
Party A and Party B Any documents required by Upon execution Yes
the receiving party to and delivery of
evidence the authority of this Agreement
the delivering party for it and such
to execute and deliver this Confirmation
Agreement, any Confirmation
to which it is a party, and
to evidence the authority of
the delivering party to
perform its obligations
under this Agreement and
such Confirmation.
Party A and Party B A certificate of an Upon the Yes
authorized officer of the execution and
party, as to the incumbency delivery of this
and authority of the Agreement and
respective officers of the such Confirmation
party signing this Agreement
4) Miscellaneous. Miscellaneous
(a) Address for Notices: For the purposes of Section 12(a)
of this Agreement:
Address for notices or communications to Party A:
Address: RALI Series 2006-QA9 Trust,
acting through Deutsche Bank Trust Company Americas
not in its individual capacity but solely in its
capacity as Supplemental Interest Trust Trustee for
the benefit of the RALI Series 2006-QA9 Supplemental
Interest Trust
Attn: RALI Series 2006-QA9 Trust
Fax: ▇▇▇-▇▇▇-▇▇▇▇
6
with a copy to: Residential Funding Company, LLC
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇: ▇▇▇-▇▇▇-▇▇▇▇
(For all purposes)
Address for notices or communications to Party B:
Address: RALI Series 2006-QA9 Trust,
acting through Deutsche Bank Trust Company Americas
not in its individual capacity but solely in its
capacity as Supplemental Interest Trust Trustee for
the benefit of the RALI Series 2006-QA9 Supplemental
Interest Trust
Attn: RALI Series 2006-QA9 Trust
Fax: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to: Residential Funding Company, LLC
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ No.: ▇▇▇-▇▇▇-▇▇▇▇
(For all purposes)
(b) Process Agent. For the purpose of Section 13(c):
Party A: Not Applicable
Party B: Not Applicable
(c) Offices. The provisions of Section 10(a) will not apply
to this Agreement; neither Party A nor Party B have any Offices other
than as set forth in the Notices Section.
(d) Multibranch Party. For the purpose of Section 10(c) of
the ISDA Form Master Agreement, neither Party A nor Party B is a
Multibranch. Party.
7
(e) Calculation Agent. The Calculation Agent is Party B.
(f) Credit Support Document.
Not Applicable
(g) Credit Support Provider.
Not Applicable
(h) Governing Law. The parties to this ISDA Agreement hereby
agree that the law of the State of New York shall govern their rights
and duties in whole, without regard to the conflict of law provision
thereof, other than New York General Obligations Law Sections 5-1401
and 5-1402.
(i) Non-Petition. Party A and Party B each hereby
irrevocably and unconditionally agrees that it will not institute
against, or join any other person in instituting against or cause any
other person to institute against RALI Series 2006-QA9 Trust, Mortgage
Asset-Backed Pass-Through Certificates, Series 2006-QA9, or the other
party any bankruptcy, reorganization, arrangement, insolvency, or
similar proceeding under the laws of the United States, or any other
jurisdiction for the non-payment of any amount due hereunder or any
other reason until the payment in full of the Certificates and the
expiration of a period of one year plus ten days (or, if longer, the
applicable preference period) following such payment.
(j) Severability. If any term, provision, covenant, or
condition of this Agreement, or the application thereof to any party
or circumstance, shall be held to be invalid or unenforceable (in
whole or in part) for any reason, the remaining terms, provisions,
covenants, and conditions hereof shall continue in full force and
effect as if this Agreement had been executed with the invalid or
unenforceable portion eliminated, so long as this Agreement as so
modified continues to express, without material change, the original
intentions of the parties as to the subject matter of this Agreement
and the deletion of such portion of this Agreement will not
substantially impair the respective benefits or expectations of the
parties.
The parties shall endeavor to engage in good faith
negotiations to replace any invalid or unenforceable term, provision,
covenant or condition with a valid or enforceable term, provision,
covenant or condition, the economic effect of which comes as close as
possible to that of the invalid or unenforceable term, provision,
covenant or condition.
8
(k) Consent to Recording. Each party hereto consents to the
monitoring or recording, at any time and from time to time, by the
other party of any and all communications between officers or
employees of the parties, waives any further notice of such monitoring
or recording, and agrees to notify its officers and employees of such
monitoring or recording.
(l) Waiver of Jury Trial. Each party to this Agreement
respectively waives any right it may have to a trial by jury in
respect of any Proceedings relating to this Agreement or any Credit
Support Document.
(m) Set-Off Notwithstanding any provision of this Agreement
or any other existing or future agreement, each party irrevocably
waives any and all rights it may have to set off, net, recoup or
otherwise withhold or suspend or condition payment or performance of
any obligation between it and the other party hereunder against any
obligation between it and the other party under any other agreements.
The provisions for Set-off set forth in Section 6(e) of the ISDA Form
Master Agreement shall not apply for purposes of this Transaction.
(n) This Agreement may be executed in several counterparts,
each of which shall be deemed an original but all of which together
shall constitute one and the same instrument.
(o) Trustee Liability Limitations. It is expressly
understood and agreed by the parties hereto that (a) this Agreement is
executed and delivered by Deutsche Bank Trust Company Americas, not
individually or personally but solely as Trustee of Party A and Party
B, in the exercise of the powers and authority conferred and vested in
it and that Deutsche Bank Trust Company Americas shall perform its
duties and obligations hereunder in accordance with the standard of
care set forth in Article VIII of the Pooling and Servicing Agreement,
(b) each of the representations, undertakings and agreements herein
made on the part of Party A and Party B is made and intended not as
personal representations, undertakings and agreements by Deutsche Bank
Trust Company Americas but is made and intended for the purpose of
binding only Party A and Party B, (c) nothing herein contained shall
be construed as creating any liability on Deutsche Bank Trust Company
Americas, individually or personally, to perform any covenant either
expressed or implied contained herein, all such liability, if any,
being expressly waived by the parties hereto and by any Person
claiming by, through or under the parties hereto; provided that
nothing in this paragraph shall relieve Deutsche Bank Trust Company
Americas from performing its duties and obligations hereunder and
under the Pooling and Servicing Agreement in accordance with the
standard of care set forth therein, and (d) under no circumstances
shall Deutsche Bank Trust Company Americas be personally liable for
9
the payment of any indebtedness or expenses of Party A or Party B or
be liable for the breach or failure of any obligation, representation,
warranty or covenant made or undertaken by Party A or Party B under
this Agreement or any other related documents; provided, that nothing
in this paragraph shall relieve Deutsche Bank Trust Company Americas
from performing its duties and obligations hereunder and under the
Pooling and Servicing Agreement in accordance with the standard of
care set forth herein and therein.
5) "Affiliate". Party A and Party B shall be deemed to not have any
Affiliates for purposes of this Agreement, including for purposes of Section
6(b)(ii).
6) Section 3 of the ISDA Form Master Agreement is hereby amended by
adding at the end thereof the following subsection (g):
"(g) Relationship Between Parties.
Each party represents to the other party on each date when it enters
into a Transaction that:--
(1) Nonreliance. (i) It is not relying on any statement
or representation of the other party regarding the Transaction (whether written
or oral), other than the representations expressly made in this Agreement or the
Confirmation in respect of that Transaction and (ii) it has consulted with its
own legal, regulatory, tax, business, investment, financial and accounting
advisors to the extent it has deemed necessary, and it has made its own
investment, hedging and trading decisions based upon its own judgment and upon
any advice from such advisors as it has deemed necessary and not upon any view
expressed by the other party.
(2) Evaluation and Understanding.
(i) It has the capacity to evaluate (internally or
through independent professional advice) the Transaction and has made its own
decision to enter into the Transaction and has been directed by the Pooling and
Servicing Agreement to enter into this Transaction; and
(ii) It understands the terms, conditions and
risks of the Transaction and is willing and able to accept those terms and
conditions and to assume those risks, financially and otherwise.
(3) Purpose. It is entering into the Transaction for
the purposes of managing its borrowings or investments, hedging its underlying
assets or liabilities or in connection with a line of business.
(4) Status of Parties. The other party is not acting
as agent, fiduciary or advisor for it in respect of the Transaction.
10
(5) Eligible Contract Participant. It is an "eligible
swap participant" as such term is defined in Section 35.1(b)(2) of the
regulations (17 C.F.R 35) promulgated under, and it constitutes an "eligible
contract participant" as such term is defined in Section 1(a)12 of the Commodity
Exchange Act, as amended."
7) Account Details and Settlement Information:
PAYMENTS TO PARTY A:
Deutsche Bank Trust Company Americas
ABA Number: ▇▇▇-▇▇▇-▇▇▇
Account Number: [as provided by Party B in writing to Party A]
Account Name: [as provided by Party B in writing to Party A]
Ref: RALI 2006-QA9 Swap
PAYMENTS TO PARTY B:
Deutsche Bank Trust Company Americas
ABA Number: ▇▇▇-▇▇▇-▇▇▇
Account Number: [as provided by Party B in writing to Party A]
Account Name: [as provided by Party B in writing to Party A]
Ref: RALI 2006-QA9 Swap
11
Please sign and return to us a copy of this Agreement.
Very truly yours,
DEUTSCHE BANK TRUST COMPANY
AMERICAS, not in its individual
capacity but solely as Supplemental
Interest Trust Trustee for the
benefit of RALI Series 2006-QA9
Supplemental Interest Trust, acting
on behalf of the Class SB
Certificateholders
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇▇
Name: ▇▇▇ ▇▇▇▇▇▇▇▇
Title: Authorized Signer
AGREED AND ACCEPTED AS OF THE TRADE
DATE DEUTSCHE BANK TRUST COMPANY
AMERICAS, not in its individual
capacity but solely as Supplemental
Interest Trust Trustee for the
benefit of RALI Series 2006-QA9
Supplemental Interest Trust, acting
on behalf of the Class A
Certificateholders, and the Class M
Certificateholders
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇▇
Name: ▇▇▇ ▇▇▇▇▇▇▇▇
Title: Authorized Signer
12
