Document:

AMENDED AND RESTATED TRUST AGREEMENT

 Exhibit 4.2 
  

EXECUTION COPY 
  
 AMENDED AND RESTATED TRUST AGREEMENT 
  
 dated as of February 19, 2004 
  
 by and among 
  
 ACCREDITED HOME LENDERS, INC., 
 as Sponsor, 
  
 ACCREDITED HOME CAPITAL, INC., 
 as Seller, 
  
 and 
  
 U.S.
BANK TRUST NATIONAL ASSOCIATION, 
 as Owner Trustee 
  

ACCREDITED MORTGAGE LOAN TRUST 2004-1 
 Asset-Backed Notes, Series 2004-1 

 TABLE OF CONTENTS 
  

					
	ARTICLE I	  	 
	DEFINITIONS	  	 
			
	 Section 1.01.
	  	Capitalized Terms	  	1
	 Section 1.02.
	  	Other Definitional Provisions	  	5
		
	ARTICLE II	  	 
	ORGANIZATION	  	 
			
	 Section 2.01.
	  	Name	  	6
	 Section 2.02.
	  	Office	  	6
	 Section 2.03.
	  	Purposes and Powers	  	6
	 Section 2.04.
	  	Appointment of Owner Trustee	  	7
	 Section 2.05.
	  	Initial Capital Contribution of Owner Trust Estate	  	7
	 Section 2.06.
	  	Declaration of Trust	  	7
	 Section 2.07.
	  	Liability of the Certificateholders	  	8
	 Section 2.08.
	  	Title to Trust Property.	  	8
	 Section 2.09.
	  	Situs of Trust	  	8
	 Section 2.10.
	  	Representations and Warranties of the Sponsor	  	8
	 Section 2.11.
	  	Federal Income Tax Treatment of the Trust.	  	9
	 Section 2.12.
	  	Covenants of the Sponsor	  	10
	 Section 2.13.
	  	Covenants of the Certificateholders	  	10
	 Section 2.14.
	  	Representations and Warranties of the Seller	  	11
	 Section 2.15.
	  	Covenants of the Seller	  	12
		
	ARTICLE III	  	 
	SUB-TRUSTS	  	 
			
	 Section 3.01.
	  	Series Trust	  	13
	 Section 3.02.
	  	Establishment of Sub-Trust.	  	13
	 Section 3.03.
	  	Assets of Sub-Trust	  	13
	 Section 3.04.
	  	Liabilities of Sub-Trust.	  	14
		
	ARTICLE IV	  	 
	CERTIFICATES AND TRANSFER OF INTERESTS	  	 
			
	 Section 4.01.
	  	Initial Ownership	  	14
	 Section 4.02.
	  	The Certificates	  	15
	 Section 4.03.
	  	Execution, Authentication and Delivery of Certificates	  	15
	 Section 4.04.
	  	Registration of Transfer and Exchange of Certificates	  	15
	 Section 4.05.
	  	Mutilated, Destroyed, Lost or Stolen Certificates	  	16
	 Section 4.06.
	  	Persons Deemed Owners	  	17
	 Section 4.07.
	  	Access to List of Certificateholders’ Names and Addresses	  	17
	 Section 4.08.
	  	Maintenance of Office or Agency	  	17
	 Section 4.09.
	  	Restrictions on Transfers of Certificates	  	17

  

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	ARTICLE V	  	 
	ACTIONS BY OWNER TRUSTEE	  	 
			
	 Section 5.01.
	  	Prior Notice to the Certificateholders with Respect to Certain Matters	  	20
	 Section 5.02.
	  	Action by Certificateholders with Respect to Bankruptcy	  	21
	 Section 5.03.
	  	Restrictions on Certificateholders’ Power	  	22
	 Section 5.04.
	  	Majority Control	  	22
		
	ARTICLE VI	  	 
	TAX PROVISIONS; CERTAIN DUTIES	  	 
			
	 Section 6.01.
	  	Federal Income Tax Provisions	  	22
	 Section 6.02.
	  	Withholding Taxes	  	25
	 Section 6.03.
	  	Accounting and Reports to the Certificateholders, the Internal Revenue Service and Others	  	26
		
	ARTICLE VII	  	 
	AUTHORITY AND DUTIES OF OWNER TRUSTEE	  	 
			
	 Section 7.01.
	  	General Authority	  	27
	 Section 7.02.
	  	General Duties	  	27
	 Section 7.03.
	  	Action upon Instruction	  	27
	 Section 7.04.
	  	No Duties Except as Specified in this Agreement, the Basic Documents or any Instructions	  	29
	 Section 7.05.
	  	No Action Except under Specified Documents or Instructions	  	29
	 Section 7.06.
	  	Restrictions	  	29
		
	ARTICLE VIII	  	 
	CONCERNING THE OWNER TRUSTEE	  	 
			
	 Section 8.01.
	  	Acceptance of Trusts and Duties	  	30
	 Section 8.02.
	  	Furnishing of Documents	  	31
	 Section 8.03.
	  	Representations and Warranties of the Owner Trustee	  	31
	 Section 8.04.
	  	Reliance; Advice of Counsel	  	32
	 Section 8.05.
	  	Not Acting in Individual Capacity	  	33
	 Section 8.06.
	  	Owner Trustee Not Liable for the Certificates or Mortgage Loans	  	33
	 Section 8.07.
	  	Owner Trustee May Own Certificates and Notes	  	33
	 Section 8.08.
	  	Licenses	  	33
		
	ARTICLE IX	  	 
	COMPENSATION OF OWNER TRUSTEE	  	 
			
	 Section 9.01.
	  	Owner Trustee’s Fees and Expenses	  	33
	 Section 9.02.
	  	Indemnification	  	34
	 Section 9.03.
	  	Payments to the Owner Trustee	  	34

  

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	ARTICLE X	  	 
	TERMINATION OF TRUST AGREEMENT	  	 
			
	 Section 10.01.
	  	Termination of Trust Agreement	  	35
		
	ARTICLE XI	  	 
	SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES	  	 
			
	 Section 11.01.
	  	Eligibility Requirements for Owner Trustee	  	36
	 Section 11.02.
	  	Resignation or Removal of Owner Trustee	  	36
	 Section 11.03.
	  	Successor Owner Trustee	  	37
	 Section 11.04.
	  	Merger or Consolidation of Owner Trustee	  	37
	 Section 11.05.
	  	Appointment of Co-Trustee or Separate Trustee.	  	38
		
	ARTICLE XII	  	 
	MISCELLANEOUS	  	 
			
	 Section 12.01.
	  	Supplements and Amendments	  	39
	 Section 12.02.
	  	No Legal Title to Owner Trust Estate in Certificateholders	  	40
	 Section 12.03.
	  	Limitations on Rights of Others	  	40
	 Section 12.04.
	  	Notices	  	40
	 Section 12.05.
	  	Severability	  	41
	 Section 12.06.
	  	Separate Counterparts	  	41
	 Section 12.07.
	  	Successors and Assigns	  	41
	 Section 12.08.
	  	No Petition	  	41
	 Section 12.09.
	  	No Recourse	  	41
	 Section 12.10.
	  	Headings	  	42
	 Section 12.11.
	  	GOVERNING LAW	  	42
	 Section 12.12.
	  	Grant of Certificateholder Rights to Note Insurer	  	42
	 Section 12.13.
	  	Third-Party Beneficiary	  	42
	 Section 12.14.
	  	Suspension and Termination of Note Insurer’s Rights	  	42
	 Section 12.15.
	  	Master Servicer	  	43
			
	 EXHIBITS
	  	 	  	 
			
	 EXHIBIT A
	  	Form of Trust Certificate	  	 
	 EXHIBIT B
	  	Form of Certificate of Trust	  	 
	 EXHIBIT C
	  	Form of Investment Letter	  	 
	 EXHIBIT D
	  	Form of Transferor Certificate	  	 

  

 iv 

 This AMENDED AND RESTATED TRUST AGREEMENT, dated as of February 19, 2004, is among ACCREDITED HOME
LENDERS, INC., as sponsor (the “Sponsor”), ACCREDITED HOME CAPITAL, INC., as seller (the “Seller”) and U.S. BANK TRUST, NATIONAL ASSOCIATION, a national banking association, as owner trustee (the “Owner
Trustee”). 
  
 NOW, THEREFORE, in consideration of the
mutual agreements herein contained, and of other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows: 
  
 ARTICLE I 
  
 DEFINITIONS 
  
 Section 1.01. Capitalized Terms. For all purposes of this Agreement, the following terms shall have the meanings set forth below: 
  
 “Agreement” shall mean this Trust Agreement, as may be
amended and supplemented from time to time. 
  
 “Annual
Tax Reports” shall have the meaning assigned thereto in Section 6.01(c)(xi). 
  
 “Authorized Officer” shall have the meaning assigned thereto in Appendix I to the Indenture. 
  
 “Backup Servicer” shall mean Countrywide Home Loans Servicing LP, or any successor backup servicer appointed pursuant to the Sale and
Servicing Agreement. 
  
 “Basic Documents” shall
mean this Agreement, the Sale and Servicing Agreement, the Indenture, the Insurance Agreement and the Indemnification Agreement. 
  
 “Business Day” shall mean any day other than (i) a Saturday or Sunday or (ii) a day that is either a legal holiday or a day on which the
Note Insurer or banking institutions in the State of New York, the State of Delaware, the State of California, or the state in which the Indenture Trustee’s office from which payments will be made to the Certificateholder, are authorized or
obligated by law, regulation or executive order to be closed. 
  
 “Capital Account” shall have the meaning assigned thereto in Section 6.01(c)(i). 
  
 “Certificate” shall mean each Trust Certificate. 
  

“Certificateholder” shall mean each Person in whose name a Trust Certificate is registered. 
  
 “Certificate of Trust” shall mean the Certificate of Trust,
in the form of Exhibit B, to be filed for the Trust pursuant to Section 3810(a) of the Statutory Trust Statute. 
  

 1 

 “Certificate Register” and “Certificate Registrar” shall mean the
register mentioned and the registrar appointed pursuant to Section 4.04. 
  
 “Class” shall mean either the Class A-1 Notes or the Class A-2 Notes. 
  
 “Class A-1 Notes” shall mean the Accredited Mortgage Loan Trust 2004-1, Asset-Backed Notes, Series 2004-1, Class A-1. 
  
 “Class A-2 Notes” shall mean the Accredited Mortgage Loan
Trust 2004-1, Asset-Backed Notes, Series 2004-1, Class A-2. 
  
 “Code” shall mean the Internal Revenue Code of 1986, as amended, and, where appropriate in context, Treasury Regulations promulgated thereunder. 
  
 “Corporate Trust Office” shall mean, with respect to the Owner Trustee, an office of the Owner Trustee
which for purposes of the Agreement is located at 209 South LaSalle Street, Suite 300, Chicago, Illinois 60604, Attention: Corporate Trust Administration; or at such other address as the Owner Trustee may designate by notice to the
Certificateholders and the Sponsor, or an office of any successor Owner Trustee (the address of which the successor Owner Trustee will notify the Certificateholders and the Sponsor). 
  
 “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended. 
  
 “Exchange Act” shall mean the Securities Exchange Act of
1934, as amended. 
  
 “Expenses” shall have the
meaning assigned to such term in Section 9.02. 
  
 “Group
I Mortgage Loans” shall mean a pool of fixed- and adjustable-rate mortgage loans, as identified in the related Mortgage Loan Schedule. 
  
 “Group II Mortgage Loans” shall mean a pool of fixed- and adjustable-rate mortgage loans, as identified in the related Mortgage Loan
Schedule. 
  
 “Holder Nonrecourse Debt Minimum
Gain” shall have the meaning set forth for “partner nonrecourse debt minimum gain” in Treasury Regulations Section 1.704-2(i)(2). A Certificateholder’s share of Holder Nonrecourse Debt Minimum Gain shall be determined in
accordance with Treasury Regulations Section 1.704-2(i)(5). 
  
 “Indemnification Agreement” shall mean the Indemnification Agreement, dated as of February 10, 2004, between the Note Insurer and the Underwriters. 
  
 “Indenture” shall mean the Indenture, dated as of February 1, 2004, by and between the Trust and the
Indenture Trustee. 
  
 “Indenture Trustee” means
Deutsche Bank National Trust Company, as Indenture Trustee under the Indenture. 
  

 2 

 “Insurance Agreement” shall mean the Insurance and Indemnity Agreement dated as of
February 19, 2004, among the Note Insurer, the Trust, the Master Servicer, the Seller, the Sponsor and the Indenture Trustee, including any amendments and supplements thereto. 
  
 “Investment Letter” shall have the meaning assigned to such term in Section 4.04. 
  
 “Loan Group” shall mean either Loan Group I or Loan Group
II. 
  
 “Loan Group I” shall mean the pool of
Mortgage Loans identified in the Mortgage Loan Schedule as having been assigned to Loan Group I. 
  
 “Loan Group II” shall mean the pool of Mortgage Loans identified in the Mortgage Loan Schedule as having been assigned to Loan Group II.

  
 “Master Servicer” shall mean Accredited Home
Lenders, Inc., a California corporation, or any successor master servicer appointed pursuant to the Sale and Servicing Agreement. 
  
 “Mortgage Loans” shall mean the Group I Mortgage Loans and the Group II Mortgage Loans. 
  
 “Non-U.S. Person” shall mean an individual, corporation,
partnership or other person other than a United States Person. 
  
 “Noteholder” shall have the meaning assigned to such terms in the Indenture. 
  
 “Note Insurance Policy” shall mean the financial guaranty insurance policy issued by the Note Insurer for the benefit of the Noteholders.

  
 “Note Insurer” shall mean Ambac Assurance
Corporation, a New York financial guaranty insurance company. 
  
 “Note Insurer Default” shall have the meaning assigned to such term in the Indenture. 
  
 “Note Principal Balance” shall have the meaning assigned to such term in the Indenture. 
  
 “Notes” shall mean the Class A-1 Notes and the Class A-2
Notes. 
  
 “Outstanding” shall have the meaning
assigned to such term in the Indenture. 
  
 “Ownership
Interest” means, with respect to any Certificate, any ownership or security interest in such Certificate, including any interest in such Certificate as the Certificateholder thereof and any other interest therein, whether direct or
indirect, legal or beneficial, as owner or as pledgee. 
  
 “Owner Trust Estate” shall mean the Trust Estate, including the contribution of $1,000 referred to in Section 2.05 hereof. 
  

 3 

 “Owner Trustee” shall mean U.S. Bank Trust National Association, a national banking
association, not in its individual capacity but solely as owner trustee under this Agreement, and any successor owner trustee hereunder. 
  
 “Payment Date” shall mean the 25th day of each month or, if such 25th day is not a Business Day, the
next succeeding Business Day, commencing March 25, 2004. 
  
 “Percentage Interest” shall mean with respect to any Certificate, the percentage portion of the Certificates evidenced thereby as stated on the face of such Certificate. 
  
 “Plan” shall mean (i) an employee benefit plan (within the
meaning of Section 3(3) of ERISA) that is subject to Title I of ERISA, (ii) a plan (within the meaning of Section 4975(e)(1) of the Code) that is subject to Section 4975 of the Code or (iii) a governmental plan (within the meaning of Section 3(32)
of ERISA) that is subject to any federal, state or local law that is, to a material extent, similar to Title I of ERISA or Section 4975 of the Code. 
  
 “Prospective Holder” shall have the meaning set forth in Section 4.09(a). 
  
 “Rating Agency Condition” means, with respect to any action to which a Rating Agency Condition applies,
that each Rating Agency shall have been given ten (10) days (or such shorter period as is acceptable to each Rating Agency) prior notice thereof and that each of the Rating Agencies shall have notified the Indenture Trustee, the Sponsor, the Master
Servicer, the Note Insurer, the Owner Trustee and the Trust in writing that such action will not result in a reduction or withdrawal of the then current rating of the Notes that it maintains without taking into account the Note Insurance Policy.

  
 “Record Date” shall mean, with respect to the
Certificates and any Payment Date, the Business Day immediately before each Payment Date. 
  
 “Sale and Servicing Agreement” shall mean the Sale and Servicing Agreement, dated as of February 1, 2004, among the Sponsor, the Trust, the Indenture Trustee, the Backup Servicer and the Master
Servicer. 
  
 “Secretary of State” shall mean the
Secretary of State of the State of Delaware. 
  
 “Seller” shall mean Accredited Home Capital, Inc., a Delaware corporation. 
  
 “Sponsor” shall mean Accredited Home Lenders, Inc., a California corporation. 
  
 “Statutory Trust Statute” shall mean Chapter 38 of Title 12
of the Delaware Code, 12 Del. Code § 3801 et seq., as the same may be amended from time to time. 
  
 “Sub-Trust” shall have the meaning specified in Section 3.01 and includes either Sub-Trust I or Sub-Trust II, each of which constitute a
separate series of interests in the Trust Estate pursuant to Section 3806(b)(2) of the Statutory Trust Statute. 
  
 “Sub-Trust I” shall mean the portion of the Trust Estate assigned to Sub-Trust I. 
  

 4 

 “Sub-Trust II” shall mean the portion of the Trust Estate assigned to Sub-Trust II.

  
 “Taxable Year” shall have the meaning
assigned thereto in Section 6.01(c)(x). 
  
 “Tax Matters
Partner” shall have the meaning assigned thereto in Section 6.01(c)(xii). 
  
 “Transfer” means any direct or indirect transfer, sale, pledge, hypothecation or other form of assignment of any Ownership Interest in a Certificate. 
  
 “Treasury Regulations” shall mean regulations, including
proposed or temporary regulations, promulgated under the Code. References herein to specific provisions of proposed or temporary regulations shall include analogous provisions of final Treasury Regulations or other successor Treasury Regulations.

  
 “Trust” shall mean the Accredited Home Equity
Loan Trust 2004-1, the Delaware statutory trust created pursuant to this Agreement. 
  
 “Trust Certificate” shall mean a certificate evidencing the beneficial interest of a Certificateholder in the Trust consisting of Sub-Trust I and Sub-Trust II, substantially in the form attached
hereto as Exhibit A. 
  
 “Trust Minimum
Gain” shall have the meaning set forth for “partnership minimum gain” in Treasury Regulations 1.704-2(b)(2) and 1.704-2(d). In accordance with Treasury Regulations Section 1.704-2(d), the amount of Trust Minimum Gain is determined
by first computing, for each nonrecourse liability of the Trust, any gain the Trust would realize if it disposed of the property subject to that liability for no consideration other than full satisfaction of the liability, and then aggregating the
separately computed gains. A Certificateholder’s share of Trust Minimum Gain shall be determined in accordance with Treasury Regulations Section 1.704-2(g)(1). 
  
 “Underwriters” shall mean Morgan Stanley & Co. Incorporated, Credit Suisse First Boston LLC, Lehman
Brothers Inc. and Goldman, Sachs & Co. 
  
 Section 1.02.
Other Definitional Provisions. (a) Capitalized terms used herein and not otherwise defined herein have the meanings assigned to them in Appendix I to the Indenture. 
  
 (b) All terms defined in this Agreement shall have the defined meanings when used in any certificate or other document made
or delivered pursuant hereto unless otherwise defined therein. 
  
 (c) As used in this Agreement and in any certificate or other document made or delivered pursuant hereto or thereto, accounting terms not defined in this Agreement or in any such certificate or other document, and accounting terms partly
defined in this Agreement or in any such certificate or other document to the extent not defined, shall have the respective meanings given to them under generally accepted accounting principles. To the extent that the definitions of accounting terns
in this Agreement or in any such certificate or other document are inconsistent with the meanings of such terms under generally accepted accounting principles, the definitions contained in this Agreement or in any such certificate or other document
shall control. 
  

 5 

 (d) The words “hereof,” “herein,” “hereunder” and words of similar import
when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement; Section and Exhibit references contained in this Agreement are references to Sections and Exhibits in or to this Agreement
unless otherwise specified; and the term “including” shall mean “including without limitation.” 
  
 (e) The definitions contained in this Agreement are applicable to the singular as well as the plural forms of such terns and to the masculine as well as
to the feminine and neuter genders of such terms. 
  
 (f) Any
agreement, instrument or statute defined or referred to herein or in any instrument or certificate delivered in connection herewith means such agreement, instrument or statute as from time to time amended, modified or supplemented and includes (in
the case of agreements or instruments) references to all attachments thereto and instruments incorporated therein; references to a Person are also to its permitted successors and assigns. 
  
 ARTICLE II 
  
 ORGANIZATION 
  
 Section 2.01. Name. The Trust governed hereby shall be known as “Accredited Mortgage Loan Trust 2004-1,” in which name the Owner Trustee
may conduct the business of the Trust, make and execute contracts and other instruments on behalf of the Trust and sue and be sued on behalf of the Trust. 
  
 Section 2.02. Office. The office of the Trust shall be in care of the Owner Trustee at the Corporate Trust Office or at such other address in the
State of Delaware as the Owner Trustee may designate by written notice to the Certificateholders, Indenture Trustee, the Note Insurer and the Sponsor. 
  
 Section 2.03. Purposes and Powers. The purpose of the Trust is to engage in the following activities: 
  
 (a) to issue the Notes pursuant to the Indenture and to sell
such Notes; 
  
 (b) with the proceeds of the sale
of the Notes and Certificates, to pay the organizational, startup and transactional expenses of the Trust and to purchase the Mortgage Loans to be included in the Owner Trust Estate from the Seller with the balance of such funds pursuant to the Sale
and Servicing Agreement; 
  
 (c) to assign,
grant, transfer, pledge, mortgage and convey the Owner Trust Estate pursuant to the Indenture and to hold, manage and distribute to the Certificateholders any portion of the Owner Trust Estate released from the lien of, and remitted to the Trust
pursuant to, the Indenture; 
  

 6 

 (d) to enter into and perform its obligations under the Basic Documents to which it is or
is to be a party; 
  
 (e) to engage in those
activities, including entering into agreements, that are necessary, suitable or convenient to accomplish the foregoing or are incidental thereto or connected therewith; 
  
 (f) subject to compliance with the Basic Documents, to engage in such other activities as may be required in
connection with conservation of the Owner Trust Estate and the making of distributions and payments to the Noteholders and the Certificateholders; and 
  
 (g) to issue the Certificates pursuant to this Agreement. 
  
 The Trust is hereby authorized by the initial beneficiary and the Certificateholders to engage in the foregoing activities.
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 or the other Basic Documents. 
  
 Section 2.04. Appointment of Owner Trustee. The Sponsor hereby appoints the Owner Trustee as trustee of the Trust
effective as of the date hereof, to have all the rights, powers and duties set forth herein and in the Statutory Trust Statute, and the Owner Trustee hereby accepts such appointment. 
  
 The Owner Trustee may engage, in the name of the Trust or in its own name on behalf of the Trust, in the activities of the Trust, make and
execute contracts on behalf of the Trust and sue on behalf of the Trust. 
  
 Section 2.05. Initial Capital Contribution of Owner Trust Estate. The Sponsor hereby sells, assigns, transfers, conveys and sets over to the Owner Trustee, as of the date hereof, the sum of $1,000. The Owner
Trustee hereby acknowledges receipt in trust from the Sponsor, as of the date hereof, of the foregoing contribution, which shall constitute the initial Owner Trust Estate and shall be deposited in the Payment Account. The Sponsor shall pay
organizational expenses of the Trust as they may arise or shall, upon the request of the Owner Trustee, promptly reimburse the Owner Trustee for any such expenses paid by the Owner Trustee. Concurrently with the execution of this Agreement, the
Trust will enter into the Sale and Servicing Agreement pursuant to which it will purchase the Mortgage Loans, to be designated to the related Sub-Trust, which comprise the remainder of the Owner Trust Estate. Upon the transfer of the Mortgage Loans
pursuant to the Sale and Servicing Agreement, the Owner Trustee shall transfer the initial capital contribution, in the sum of $1,000, to the Sponsor. 
  
 Section 2.06. Declaration of Trust. The Owner Trustee hereby declares that it will hold the Owner Trust Estate in trust upon and subject to the
conditions set forth herein for the use and benefit of the Noteholders, the Note Insurer and the Certificateholders, subject to the obligations of the Trust Under the Basic Documents. 
  
 It is the intention of the parties hereto that, solely for income and franchise tax purposes, the Trust constitutes a
statutory trust under the Statutory Trust Statute and that this 
  

 7 

 Agreement constitutes the governing instrument of such statutory trust. It is the intention of the parties hereto that,
solely for income and franchise tax purposes, the Trust shall be treated as a security arrangement, with the assets of the Trust being the Sub-Trusts consisting of each Loan Group. The parties agree that, unless otherwise required by appropriate tax
authorities, the Trust will file or cause to be filed annual or other necessary returns, reports and other forms, if any, consistent with the characterization of the Trust, the Sub-Trusts and each Loan Group as provided in the preceding sentence for
such tax purposes. Effective as of the date hereof, the Owner Trustee shall have all rights, powers and duties set forth herein and in the Statutory Trust Statute with respect to accomplishing the purposes of the Trust. The Owner Trustee shall file
the Certificate of Trust with the Secretary of State. 
  
 Section
2.07. Liability of the Certificateholders. Subject to Section 2.05, no Certificateholder shall have any personal liability for any liability or obligation of the Trust. The Certificates shall be fully paid and nonassessable. 
  
 Section 2.08. Title to Trust Property. 
  
 (a) Subject to the Indenture, legal title to all of the Owner Trust Estate
shall be vested at all times in the Trust as a separate legal entity except where applicable law in any jurisdiction requires title to any part of the Owner Trust Estate to be vested in a trustee or trustees, in which case title shall be deemed to
be vested in the Owner Trustee and/or a separate trustee, as the case may be. 
  
 (b) The Certificateholders shall not have legal title to any part of the Owner Trust Estate. No transfer by operation of law or otherwise of any interest of the Certificateholders shall operate to terminate this
Agreement or the trusts hereunder or entitle any transferee to an accounting or to the transfer to it of any part of the Owner Trust Estate. 
  
 Section 2.09. Situs of Trust. The Trust will be located in the State of Delaware and administered by the Owner Trustee in the States of Delaware
and Illinois. The Trust shall not have any employees; provided, however, that nothing herein shall restrict or prohibit the Owner Trustee from having employees within or without the State of Delaware. 
  
 Section 2.10. Representations and Warranties of the Sponsor. The
Sponsor hereby represents and warrants to the Owner Trustee and the Note Insurer that: 
  
 (a) The Sponsor is duly organized and validly existing as a corporation in good standing under the laws of the State of California, with power and authority to own its properties and to conduct its business as such
properties are currently owned and such business is presently conducted. 
  
 (b) The Sponsor has the power and authority to execute and deliver this Agreement and to carry out its terms; and the execution, delivery and performance of this Agreement has been duly authorized by the Sponsor by
all necessary corporate action. 
  
 (c) The consummation of the
transactions contemplated by this Agreement and the fulfillment of the terms hereof do not conflict with, result in any breach of any of the terms and provisions of, or constitute (with or without notice or lapse of time) a default under, the
articles 
  

 8 

 of incorporation or by-laws of the Sponsor, or any indenture, agreement or other instrument to which the Sponsor is a
party or by which it is bound; nor result in the creation or imposition of any lien upon any of its properties pursuant to the terns of any such indenture, agreement or other instrument (other than pursuant to the Basic Documents); nor violate any
law or, any order, rule or regulation applicable to the Sponsor of any court or of any Federal or state regulatory body, administrative agency or other governmental instrumentality having jurisdiction over the Sponsor or its properties. 

 
 (d) There are no proceedings or investigations pending or notice of which
has been received in writing before any court, regulatory body, administrative agency or other governmental instrumentality having jurisdiction over the Sponsor or its properties: (x) asserting the invalidity of this Agreement, (y) seeking to
prevent the consummation of any of the transactions contemplated by this Agreement or (z) seeking any determination or ruling that should reasonably be expected to materially and adversely affect the performance by the Sponsor of its obligations
under, or the validity or enforceability of, this Agreement. 
  
 (e) The representations and warranties of the Sponsor in Article III of the Sale and Servicing Agreement are true and correct. 
  
 (f) The Sponsor has duly executed and delivered this Agreement, and this Agreement constitutes the legal, valid and binding obligation of the Sponsor,
enforceable against the Sponsor, in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, moratorium or similar laws affecting the enforcement of creditors’ rights generally and by the
application of equitable principles. 
  
 (g) The Sponsor 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 other governmental agency, which default might have consequences that would materially and adversely affect the condition
(financial or otherwise) or operations of the Sponsor or its properties or might have consequences that would materially and adversely affect its performance hereunder. 
  
 (h) The Sponsor will hold itself out to the public under its own name as a separate and distinct entity from the Seller and
the Trust and conduct its business so as not to mislead others as to the identity of the Trust. Without limiting the generality of the foregoing, all oral and written communications, including without limitation, all letters, invoices, contracts,
statements and applications will be made solely in the name of the Trust if they are made on behalf of the Trust and solely in the name of the Sponsor if they are made on behalf of the Sponsor. 
  
 Section 2.11. Federal Income Tax Treatment of the Trust. 

 
 (a) For so long as the Trust has one Certificateholder for federal income
tax purposes, it will, pursuant to Treasury Regulations promulgated under Section 7701 of the Code, be disregarded as an entity distinct from the Certificateholder for all federal income tax purposes. Accordingly, for federal income tax purposes,
the Certificateholder will be treated as (i) owning all assets owned by the Trust, (ii) having incurred all liabilities incurred by the Trust, and (iii) all transactions between the Trust and the Certificateholder will be disregarded. 
  

 9 

 (b) In the event that the Trust has two or more Certificateholders for federal income tax purposes, the
Trust will be treated as a partnership. At any such time that the Trust has two or more Certificateholders, this Agreement may need to be amended, in accordance with Section 12.01 herein, and appropriate provisions may need to be added so as to
provide for treatment of the Trust as a partnership. 
  
 (c) The
Owner Trustee shall have no obligation or liability for its failure to treat the Trust as a partnership prior to the earlier of its receipt of notice or its having actual knowledge that the Trust has more than a single equity owner. 
  
 (d) Neither the Owner Trustee nor any Certificateholder will, under any
circumstances, file a Form 8832, or any successor form, on behalf of the Trust. 
  
 Section 2.12. Covenants of the Sponsor. The Sponsor agrees and covenants for the benefit of each Certificateholder, the Note Insurer and the Owner Trustee, during the term of this Agreement, and to the fullest
extent permitted by applicable law, that: 
  
 (a) it shall not,
for any reason, institute proceedings for the Trust to be adjudicated bankrupt or insolvent, or consent to or join in the institution of bankruptcy or insolvency proceedings against the Trust, or file a petition seeking or consenting to
reorganization or relief under any applicable federal or state law relating to the bankruptcy of the Trust, or consent to the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of the Trust or a
substantial part of the property of the Trust or cause or permit the Trust to make any assignment for the benefit of creditors, or admit in writing the inability of the Trust to pay its debts generally as they become due, or declare or effect a
moratorium on the debt of the Trust or take any action in furtherance of any such action; 
  
 (b) it shall obtain from each counterparty to each Basic Document to which it or the Trust is a party and each other agreement entered into on or after the date hereof to which it or the Trust is a party, an agreement
by each such counterparty that prior to the occurrence of certain events specified in such agreement, such counterparty shall not institute against, or join any other Person in instituting against, it or the Trust, any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings or other similar proceedings under the laws of the United States or any state of the United States; and 
  
 (c) it shall not, for any reason, withdraw or attempt to withdraw from this Agreement or any other Basic Document to which it is a party. 
  
 Section 2.13. Covenants of the Certificateholders. Each
Certificateholder by becoming a beneficial owner of the Certificate or by its acceptance of a Certificate agrees: 
  
 (a) to be bound by the terms and conditions of the Certificates of which such Certificateholder is the beneficial owner and of this Agreement and the
other Basic Documents, including any supplements or amendments hereto and thereto and to perform the obligations of a Certificateholder as set forth therein or herein, in all respects as if it were a signatory hereto. This undertaking is made for
the benefit of the Trust, the Owner Trustee, the Note Insurer and all other Certificateholders, present and future; 
  

 10 

 (b) to the appointment of the Owner Trustee as such Certificateholder’s agent and attorney-in-fact
to sign any federal income tax information return filed on behalf of the Trust and, if requested by the Trust, to sign such federal income tax information return in its capacity as holder of an interest in the Trust; 
  
 (c) not to take any position in such Certificateholder’s tax returns
inconsistent with those taken in any tax returns filed by the Trust; and 
  
 (d) if such Certificateholder is other than an individual or other entity holding its Certificate through a broker who reports securities sales on Form 1099-B, to notify the Owner Trustee in writing of any transfer by
it of a Certificate in a taxable sale or exchange, within 30 days of the date of the transfer. 
  
 Section 2.14. Representations and Warranties of the Seller. The Seller hereby represents and warrants to the Owner Trustee and the Note Insurer that: 
  
 (a) The Seller is duly organized and validly existing as a corporation in
good standing under the laws of the State of Delaware, with power and authority to own its properties and to conduct its business as such properties are currently owned and such business is presently conducted. 
  
 (b) The Seller has the power and authority to execute and deliver this
Agreement and to carry out its terms; the Seller has full power and authority to transfer and assign the property to be transferred and assigned to and deposited with the Trust and the Seller has duly authorized such transfer and assignment and
deposit to the Trust by all necessary corporate action; and the execution, delivery and performance of this Agreement has been duly authorized by the Seller by all necessary corporate action. 
  
 (c) The consummation of the transactions contemplated by this Agreement and
the fulfillment of the terms hereof do not conflict with, result in any breach of any of the terms and provisions of, or constitute (with or without notice or lapse of time) a default under, the articles of incorporation or by-laws of the Seller, or
any indenture, agreement or other instrument to which the Seller is a party or by which it is bound; nor result in the creation or imposition of any lien upon any of its properties pursuant to the terns of any such indenture, agreement or other
instrument (other than pursuant to the Basic Documents); nor violate any law or, any order, rule or regulation applicable to the Seller of any court or of any Federal or state regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Seller or its properties. 
  
 (d) There are no proceedings or investigations pending or notice of which has been received in writing before any court, regulatory body, administrative agency or other governmental instrumentality having jurisdiction over the Seller or its
properties: (x) asserting the invalidity of this Agreement, (y) seeking to prevent the consummation of any of the transactions contemplated by this Agreement or (z) seeking any determination or ruling that should reasonably be expected to materially
and adversely affect the performance by the Seller of its obligations under, or the validity or enforceability of, this Agreement. 
  

 11 

 (e) The representations and warranties of the Seller in Article III of the Sale and Servicing Agreement
are true and correct. 
  
 (f) The Seller has duly executed and
delivered this Agreement, and this Agreement constitutes the legal, valid and binding obligation of the Seller, enforceable against the Seller, in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy,
insolvency, moratorium or similar laws affecting the enforcement of creditors’ rights generally and by the application of equitable principles. 
  
 (g) The Seller 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
other governmental agency, which default might have consequences that would materially and adversely affect the condition (financial or otherwise) or operations of the Seller or its properties or might have consequences that would materially and
adversely affect its performance hereunder. 
  
 (h) The Seller
will hold itself out to the public under its own name as a separate and distinct entity from the Sponsor and the Trust and conduct its business so as not to mislead others as to the identity of the Trust. Without limiting the generality of the
foregoing, all oral and written communications, including without limitations, all letters, invoices, contracts, statements and applications will be made solely in the name of the Trust if they are made on behalf of the Trust and solely in the name
of the Seller if they are made on behalf of the Seller. 
  
 Section 2.15. Covenants of the Seller. The Seller agrees and covenants for the benefit of each Certificateholder, the Note Insurer and the Owner Trustee, during the term of this Agreement, and to the fullest extent permitted by
applicable law, that: 
  
 (a) it shall not create, incur or
suffer to exist any indebtedness or engage in any business, except, in each case, as permitted by its articles of incorporation and by-laws and the Basic Documents; 
  
 (b) it shall not, for any reason, institute proceedings for the Trust to be adjudicated bankrupt or insolvent, or consent to
or join in the institution of bankruptcy or insolvency proceedings against the Trust, or file a petition seeking or consenting to reorganization or relief under any applicable federal or state law relating to the bankruptcy of the Trust, or consent
to the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of the Trust or a substantial part of the property of the Trust or cause or permit the Trust to make any assignment for the benefit of
creditors, or admit in writing the inability of the Trust to pay its debts generally as they become due, or declare or effect a moratorium on the debt of the Trust or take any action in furtherance of any such action; 
  
 (c) it shall obtain from each counterparty to each Basic Document to which it
or the Trust is a party and each other agreement entered into on or after the date hereof to which it or the Trust is a party, an agreement by each such counterparty that prior to the occurrence of certain events specified in such agreement, such
counterparty shall not institute against, or join any other Person in instituting against, it or the Trust, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings or other similar proceedings under the laws of the United
States or any state of the United States; and 
  

 12 

 (d) it shall not, for any reason, withdraw or attempt to withdraw from this Agreement or any other Basic
Document to which it is a party, dissolve, institute proceedings for it to be adjudicated a bankrupt or insolvent, or consent to the institution of bankruptcy or relief under any applicable federal or state law relating to bankruptcy, or consent to
the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of it or a substantial part of its property, or make any assignment for the benefit of creditors, or admit in writing its inability to pay its
debts generally as they become due, or declare or effect a moratorium on its debt or take any action in furtherance of any such action. 
  
 ARTICLE III 
  
 SUB-TRUSTS 
  
 Section 3.01. Series Trust. The beneficial interest in the assets of the Trust shall be divided into designated series as provided in Section 3806(b)(2) of the Statutory Trust Statute (the segregated pool of assets belonging to each
series, a “Sub-Trust”). Accordingly, it is the intent of the parties hereto that Articles II, IV and X of this Agreement shall apply also with respect to each such Sub-Trust as if each such Sub-Trust were a separate series of a
statutory trust under the Statutory Trust Statute, and each reference to the term “Trust” in such Articles shall be deemed to be a reference to each such Sub-Trust to the extent necessary to give effect to the foregoing intent. The use of
the terms “Trust” or “Sub-Trust” in this Agreement shall in no event alter the intent of the parties hereto that the Trust receive the full benefit of the limitation on interseries liability as set forth in Section 3804 of the
Statutory Trust Statute. 
  
 Section 3.02. Establishment of
Sub-Trust. 
  
 The Owner Trustee hereby establishes and
designates two initial Sub-Trusts, as follows: 
  
 Sub-Trust I and
Sub-Trust II 
  
 The provisions of this Article III shall be
applicable to the above designated Sub-Trusts. 
  
 Section 3.03.
Assets of Sub-Trust. All consideration received by the Owner Trust Estate for the issuance or sale of the Notes relating to a particular Loan Group and Sub-Trust, together with the entire Owner Trust Estate in which such consideration is
invested or reinvested, all income, earnings, profits, and proceeds thereof, including any proceeds derived from the sale, exchange or liquidation of such assets, and any funds or payments derived from any reinvestment of such proceeds in whatever
form the same may be, shall irrevocably belong solely to that Sub-Trust for all purposes, subject only to the rights of creditors of such Sub-Trust and except as may otherwise be provided in the Sale and Servicing Agreement or required by applicable
tax laws, and shall be so recorded upon the books of account of the Trust. Separate and distinct records shall be maintained for each Sub-Trust and the assets associated with a Sub-Trust shall be held and accounted for separately from the other
assets of the Owner Trust Estate, and any other Sub-Trust. In the event that there is any Owner Trust Estate, or any income, earnings, profits, and proceeds thereof, or funds or payments which are not readily identifiable as belonging to any

  

 13 

 particular Sub-Trust, the Owner Trustee shall allocate them to the Certificates generally. Each such allocation by the
Owner Trustee shall be conclusive and binding upon all Noteholders and Certificateholders for all purposes. 
  
 Section 3.04. Liabilities of Sub-Trust. 
  
 The Owner Trust Estate belonging to each particular Sub-Trust shall be charged with the liabilities of the Trust in respect of that Sub-Trust and only
that Sub-Trust and all expenses, costs, charges and reserves attributable to that Sub-Trust, and any general liabilities, expenses, costs, charges or reserves of the Trust which are not readily identifiable as belonging to any particular Sub-Trust
shall be allocated and charged by the Owner Trustee to the Certificateholders generally, based on their Ownership Interest. Each allocation of liabilities, expenses, costs, charges and reserves by the Owner Trustee shall be conclusive and binding
upon all Noteholders and Certificateholders for all purposes. The Owner Trustee shall have full discretion, to the extent not inconsistent with applicable law, to determine which items shall be treated as income and which items as capital, and each
such determination and allocation shall be conclusive and binding upon the Noteholders and the Certificateholders. Every written agreement, instrument or other undertaking made or issued by or on behalf of a particular Sub-Trust shall include a
recitation limiting the obligation or claim represented thereby to that Sub-Trust and its assets. 
  
 Without limitation of the foregoing provisions of this Article, but subject to the right of the Owner Trustee in its discretion to allocate general
liabilities, expenses, costs, charges or reserves as herein provided, the debts, liabilities, obligations and expenses incurred, contracted for or otherwise existing with respect to a particular Sub-Trust shall be enforceable against the assets of
such Sub-Trust only, and not against the assets (i) of the Trust generally or (ii) of the other Sub-Trust. Notice of this limitation on interseries liabilities shall be set forth in the Certificate of Trust of the Trust (whether originally or by
amendment) as filed or to be filed in the Office of the Secretary of State pursuant to the Statutory Trust Statute, and upon the giving of such notice in the Certificate of Trust, the statutory provisions of Section 3804 of the Statutory Trust
Statute relating to limitations on interseries liabilities (and the statutory effect under Section 3804 of setting forth such notice in the Certificate of Trust) shall become applicable to the Trust and each Sub-Trust. Every note, bond, contract,
instrument, certificate or other undertaking made or issued by or on behalf of a particular Sub-Trust shall include a recitation limiting the obligation represented thereby to that Sub-Trust and its assets in accordance with Section 3804(a) of the
Statutory Trust Statute. 
  
 ARTICLE IV 
  
 CERTIFICATES AND TRANSFER OF INTERESTS 
  
 Section 4.01. Initial Ownership. Upon the formation of the Trust by
the contribution by the Sponsor pursuant to Section 2.05 and the filing of the Certificate of Trust with the Secretary of State and until the issuance of the Certificates, the Sponsor shall be the sole owner of the Trust. 
  

 14 

 Section 4.02. The Certificates. The Certificates shall be issued as a single certificate which
shall represent each separate series of beneficial interests in each Sub-Trust, substantially in the form of Exhibit A hereto, upon the order of the Owner Trustee, at the direction of the Sponsor, to the Seller concurrently with the sale and
assignment to the Trust of the Mortgage Loans by the Seller, at the direction of the Sponsor, to the Owner Trustee. The Certificates shall represent the entire beneficial interest in the assets of each Sub-Trust subject to the debt represented by
the Notes relating to each Sub-Trust. The Certificates shall be printed, lithographed or engraved or may be produced in any other manner as is reasonably acceptable to the Owner Trustee, as evidenced by its execution thereof. The Certificates shall
be executed on behalf of the Trust by manual or facsimile signature of an Authorized Officer of the Owner Trustee. Certificates bearing the manual or facsimile signatures of individuals who were, at the time when such signatures shall have been
affixed, authorized to sign on behalf of the Trust, shall be valid, notwithstanding that such individuals or any of them shall have ceased to be so authorized prior to the authentication and delivery of such Certificates or did not hold such offices
at the date of authentication and delivery of such Certificates. 
  
 A transferee of a Certificate shall become a Certificateholder, and shall be entitled to the rights and subject to the obligations of a Certificateholder hereunder upon such transferee’s acceptance of a Certificate duly registered in
such transferee’s name pursuant to Section 4.04. 
  
 The
beneficial interest in each Sub-Trust shall be treated as a single class of securities represented by the Certificates for purposes of Article 8 of the Uniform Commercial Code of the State of Delaware. 
  
 Section 4.03. Execution, Authentication and Delivery of Certificates.
Concurrently with the initial transfer of the Mortgage Loans to the Trust pursuant to the Sale and Servicing Agreement, the Owner Trustee shall cause the Certificates, representing 100% of the Percentage Interests of the Trust, to be executed on
behalf of the Trust, authenticated and delivered, at the written direction of the Sponsor, to the Seller as initial Certificateholder. No Certificate shall entitle its holder to any benefit under this Agreement, or shall be valid for any purpose,
unless there shall appear on such Certificate a certificate of authentication substantially in the form set forth in Exhibit A, executed by the Owner Trustee or the Owner Trustee’s authenticating agent, by manual or facsimile signature;
such authentication shall constitute conclusive evidence that such Certificate shall have been duly authenticated and delivered hereunder. All Certificates shall be dated the date of their authentication. 
  
 Section 4.04. Registration of Transfer and Exchange of Certificates.
The Certificate Registrar shall keep or cause to be kept, at the office or agency maintained pursuant to Section 4.08, a Certificate Register in which, subject to such reasonable regulations as it may prescribe, the Certificate Registrar shall
provide for the registration of Certificates and of transfers and exchanges of Certificates as herein provided. The Owner Trustee shall be the initial “Certificate Registrar.” 
  
 Upon surrender for registration of transfer of any Certificate at the office or agency maintained pursuant to Section 4.08,
the Owner Trustee, upon the satisfaction of the conditions set forth in Section 4.09(c), shall execute, authenticate and deliver (or shall cause its 
  

 15 

 authenticating agent to authenticate and deliver), in the name of the designated transferee or transferees, one or more
new Certificates of a like Percentage Interest dated the date of authentication by the Owner Trustee or any authenticating agent. At the option of a Certificateholder, Certificates may be exchanged for other Certificates of a like Percentage
Interest upon surrender of the Certificates to be exchanged at the office or agency maintained pursuant to Section 4.08. 
  
 Every Certificate presented or surrendered for registration of transfer or exchange shall be accompanied by a written instrument of transfer in form,
attached to the form of Certificate attached hereto as Exhibit A, or such other form satisfactory to the Note Insurer, or, upon the occurrence and continuation of a Note Insurer Default, satisfaction of the Rating Agency Condition, duly
executed by the Certificateholder or his attorney duly authorized in writing. 
  
 No service charge shall be made for any registration of transfer or exchange of Certificates, but the Owner Trustee or the Certificate Registrar 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. 
  
 The preceding provisions of this Section 4.04 notwithstanding, the Certificate Registrar shall not register transfers or exchanges of Certificates for a period of fifteen (15) days preceding the Payment Date with
respect to the Certificates. 
  
 Notwithstanding anything
contained herein to the contrary, neither the Certificate Registrar nor the Owner Trustee shall be responsible for ascertaining whether any transfer complies with the registration provisions or exemptions from the Securities Act of 1933, as amended,
the Securities Act of 1934, as amended, applicable state securities law or the Investment Company Act of 1940, as amended; provided, however, that if an Investment Letter is specifically required to be delivered to the Owner Trustee by
a purchaser or transferee of a Certificate, the Owner Trustee shall be under a duty to examine the same to determine whether it conforms to the form of Investment Letter set forth as Exhibit C hereto and shall promptly notify the party
delivering the same if such Investment Letter does not so conform. 
  
 Section 4.05. Mutilated, Destroyed, Lost or Stolen Certificates. If (a) any mutilated Certificate shall be surrendered to the Certificate Registrar, or if the Certificate Registrar shall receive evidence to its satisfaction of the
destruction, loss or theft of any Certificate and (b) there shall be delivered to the Certificate Registrar and the Owner Trustee such security or indemnity as may be required by them to save each of them harmless, then in the absence of notice that
such Certificate shall have been acquired by a protected purchaser, the Owner Trustee on behalf of the Trust shall execute and the Owner Trustee, or the Owner Trustee’s authenticating agent, shall authenticate and deliver, in exchange for or in
lieu of any such mutilated, destroyed, lost or stolen Certificate, a new Certificate of like Percentage Interest. In connection with the issuance of any new Certificate under this Section 4.05, the Owner Trustee or the Certificate Registrar may
require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection therewith. Any duplicate Certificate issued pursuant to this Section shall constitute conclusive evidence of ownership in the
Trust, as if originally issued, whether or not the lost, stolen or destroyed Certificate shall be found at any time. 
  

 16 

 Section 4.06. Persons Deemed Owners. Each person by virtue of becoming a Certificateholder in
accordance with this Agreement shall be deemed to be bound by the terns of this Agreement. Prior to due presentation of a Certificate for registration of transfer, the Owner Trustee or the Certificate Registrar may treat the Person in whose name any
Certificate shall be registered in the Certificate Register as the owner of such Certificate for the purpose of receiving distributions pursuant to Section 6.02 and for all other purposes whatsoever, and neither the Owner Trustee nor the Certificate
Registrar shall be bound by any notice to the contrary. 
  
 Section 4.07. Access to List of Certificateholders’ Names and Addresses. The Certificate Registrar shall furnish or cause to be furnished to the Owner Trustee, the Master Servicer, the Sponsor and the Indenture Trustee
immediately prior to each Payment Date, a list of the names and addresses of the Certificateholders as of the most recent Record Date. If one or more Certificateholder, together evidencing Percentage Interests totaling not less than 25%, apply in
writing to the Certificate Registrar, and such application states that the applicants desire to communicate with other Certificateholders with respect to their rights under this Agreement or under the Certificates and such application is accompanied
by a copy of the communication that such applicants propose to transmit, then the Certificate Registrar shall, within five (5) Business Days after the receipt of such application, afford such applicants access during normal business hours to the
current list of Certificateholders. Each Certificateholder, by receiving and holding a Certificate, shall be deemed to have agreed not to hold any of the Sponsor, the Certificate Registrar or the Owner Trustee accountable by reason of the disclosure
of its name and address, regardless of the source from which such information was derived. 
  
 Section 4.08. Maintenance of Office or Agency. The Owner Trustee shall maintain an office or offices or agency or agencies where notices and demands to or upon the Owner Trustee in respect of the Basic
Documents may be served, and so long as the Owner Trustee is the Certificate Registrar, where Certificates may be surrendered for registration of transfer or exchange and notices and demands to or upon the Certificate Registrar in respect of the
Certificates, may be served. The Owner Trustee initially designates the Corporate Trust Office as its principal corporate trust office for such purposes. The Owner Trustee shall give prompt written notice to the Note Insurer, the Indenture Trustee,
the Sponsor and the Certificateholders of any change in the location of the Certificate Register or any such office or agency. 
  
 Section 4.09. Restrictions on Transfers of Certificates. (a) Each prospective purchaser and any subsequent transferee of a Certificate (each, a
“Prospective Holder”), other than the Sponsor, shall execute and deliver to the Owner Trustee and the Certificate Registrar and any of their respective successors an Investment Letter in the form of Exhibit C hereto to the effect
that: 
  
 (i) Such Person is (A) a
“qualified institutional buyer” as defined in Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), and is aware that the seller of the Certificate may be relying on the exemption from the
registration requirements of the Securities Act provided by Rule 144A and is acquiring such Certificate for its own account or for the account of one or more qualified institutional buyers for whom it is authorized to act, or (B) a Person involved
in the organization or operation of the Trust or an affiliate of such Person within the meaning of Rule 3a-7 of the Investment Company Act of 1940, as amended (including, but not limited to, the Sponsor). 
  

 17 

 (ii) Such Person understands that the Certificates have not been and will not be
registered under the Securities Act and may be offered, sold, pledged or otherwise transferred only to a person whom the seller reasonably believes is (A) a qualified institutional buyer or (B) a Person involved in the organization or operation of
the Trust or an affiliate of such Person, in a transaction pursuant to an effective registration statement under the Securities Act and any applicable state securities laws or exempt from the registration requirements of the Securities Act and any
such state securities laws. 
  
 (iii) Such Person
understands that the Certificates bear a legend to the following effect: 
  
 “THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY STATE SECURITIES LAWS. THIS CERTIFICATE MAY BE DIRECTLY OR INDIRECTLY
OFFERED OR SOLD OR OTHERWISE DISPOSED OF (INCLUDING PLEDGED) BY THE HOLDER HEREOF ONLY TO (I) A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE ACT, IN A TRANSACTION THAT IS REGISTERED UNDER THE ACT AND APPLICABLE STATE
SECURITIES LAWS OR THAT IS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND SUCH STATE LAWS OR (II) A PERSON INVOLVED IN THE ORGANIZATION OR OPERATION OF THE TRUST OR AN AFFILIATE OF SUCH A PERSON WITHIN THE MEANING OF RULE 3a-7 OF THE
INVESTMENT COMPANY ACT OF 1940, AS AMENDED (INCLUDING, BUT NOT LIMITED TO, ACCREDITED HOME LENDERS, INC.) IN A TRANSACTION THAT IS REGISTERED UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS OR THAT IS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF
THE ACT AND SUCH LAWS. NO PERSON IS OBLIGATED TO REGISTER THIS CERTIFICATE UNDER THE ACT OR ANY STATE SECURITIES LAWS.” 
  
 (b) By its acceptance of a Certificate, each Prospective Holder agrees and acknowledges that no legal or beneficial interest in all or any portion of any
Certificate may be transferred directly or indirectly to an entity that holds residual securities as nominee to facilitate 
  

 18 

 the clearance and settlement of such securities through electronic book-entry changes in accounts of participating
organizations (a “Book-Entry Nominee”) and any such purported transfer shall be void and have no effect. 
  
 The Certificates shall bear an additional legend referring to the restrictions contained in preceding paragraph to the following effect: 
  
 THIS CERTIFICATE MAY NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF
UNLESS, PRIOR TO SUCH DISPOSITION, THE PROPOSED TRANSFEREE DELIVERS TO THE OWNER TRUSTEE AND THE CERTIFICATE REGISTRAR A CERTIFICATE STATING THAT SUCH TRANSFEREE IS NOT AN ENTITY THAT WILL HOLD THIS CERTIFICATE AS NOMINEE TO FACILITATE THE CLEARANCE
AND SETTLEMENT OF SUCH SECURITY THROUGH ELECTRONIC BOOK-ENTRY CHANGES IN ACCOUNTS OF PARTICIPATING ORGANIZATIONS. 
  
 (c) No transfer of a Certificate or any beneficial interest therein shall be made to any person unless the Owner Trustee has received a representation
letter from the Prospective Holder to the effect that such Prospective Holder is not a Plan and is not, directly or indirectly, purchasing such Certificate or interest therein on behalf of, as investment manager of, as named fiduciary of, as trustee
of, or with the assets of a Plan. 
  
 (d) The Owner Trustee shall
not execute, and shall not countersign and deliver, a Certificate in connection with any transfer thereof unless the transferor shall have provided to the Owner Trustee an Investment Letter, signed by the transferee, which certificate shall contain
the consent of the transferee to any amendments of this Agreement as may be required to effectuate further the foregoing restrictions on transfer of the Certificates to Book-Entry Nominees, and an agreement by the transferee that it will not
transfer a Certificate without providing to the Owner Trustee an Investment Letter. 
  
 (e) [Reserved]. 
  
 (f) Unless the
Prospective Holder delivers a certificate to the Owner Trustee to the effect that it is a United States Person, the Prospective Holder, other than Accredited Home Lenders, Inc. or an affiliate of the Accredited Home Lenders, Inc., shall obtain and
deliver to the Note Insurer and the Owner Trustee an Opinion of Counsel satisfactory to the Note Insurer to the effect that, as a matter of federal income tax law, the transfer of the Certificate to such Prospective Holder will not result in the
imposition of any U.S. withholding tax on payments in respect of the Mortgage Loans or the Certificate. 
  
 (g) No pledge or transfer of the Certificates shall be effective unless such pledge or transfer is (i) to a single beneficial owner and (ii) accompanied
by an Opinion of Counsel 
  

 19 

 satisfactory to the Owner Trustee and the Note Insurer, which Opinion of Counsel shall not, unless otherwise agreed, be
an expense of the Trust, the Certificate Registrar, the Master Servicer, the Backup Servicer, the Note Insurer or the Sponsor, to the effect such pledge or transfer will not cause the Trust to be treated for federal income tax purposes as a taxable
mortgage pool, association or a publicly traded partnership taxable as a corporation. 
  
 ARTICLE V 
  
 ACTIONS BY
OWNER TRUSTEE 
  
 Section 5.01. Prior Notice to the
Certificateholders with Respect to Certain Matters. With respect to the following matters, the Owner Trustee shall not take action (and the Certificateholders shall not direct the Owner Trustee to take any action) unless at least thirty (30)
days before the taking of such action, the Owner Trustee shall have notified the Certificateholders (unless the Certificateholders have directed the Owner Trustee to take action) and the Note Insurer in writing of the proposed action and neither the
Certificateholders nor the Note Insurer shall have notified the Owner Trustee in writing prior to the 30th day after
such notice is given that such Certificateholders and/or the Note Insurer have withheld consent or the Certificateholders have provided alternative written direction (any direction by the Certificateholders shall require the prior written consent of
the Note Insurer): 
  
 (a) the initiation of any
claim or lawsuit by the Trust (except claims or lawsuits brought in connection with the collection of the Mortgage Loans) and the compromise of any action, claim or lawsuit brought by or against the Trust (except with respect to the aforementioned
claims or lawsuits for collection of the Mortgage Loans); 
  
 (b) the election by the Trust to file an amendment to the Certificate of Trust (unless such amendment is required to be filed under the Statutory Trust Statute); 
  
 (c) the amendment or other change to this Agreement or any
Basic Document in circumstances where the consent of any Certificateholder is required; provided, that notwithstanding this Section 5.01, the prior written consent of the Note Insurer must be obtained for any amendment or change to this
Agreement or any other Basic Document; 
  
 (d)
the amendment or other change to this Agreement or any other Basic Document in circumstances where the consent of any Certificateholder is not required and such amendment materially adversely affects the interest of the Certificateholders;

  
 (e) the appointment pursuant to the Indenture
of a successor Note Registrar, or Indenture Trustee or pursuant to this Agreement of a successor Certificate Registrar or the consent to the assignment by the Note Registrar or Indenture Trustee or Certificate Registrar of their respective
obligations under the Indenture or this Agreement, as applicable; 
  
 (f) the consent to the waiver of any default of any Basic Document; 
  
 (g) the consent to the assignment by the Indenture Trustee or Master Servicer of their respective obligations under any Basic Document;

  

 20 

 (h) except as provided in Article X hereof, dissolve, terminate or liquidate the Trust in
whole or in part; 
  
 (i) merge or consolidate
the Trust with or into any other entity, or convey or transfer all or substantially all of the Trust’s assets to any other entity; 
  
 (j) cause the Trust to incur, assume or guaranty any indebtedness other than as set forth in this Agreement or the other Basic Documents;

  
 (k) do any act which would make it impossible
to carry on the ordinary business of the Trust as described in Section 2.03 hereof; 
  
 (l) confess a judgment against the Trust; 
  
 (m) possess Trust assets, or assign the Trust’s right to property, for other than a Trust purpose; 
  
 (n) cause the Trust to lend any funds to any entity; or

  
 (o) change the Trust’s purpose and
powers from those set forth in this Agreement. 
  
 In addition the
Trust shall not commingle its assets with those of any other entity. The Trust shall maintain its financial and accounting books and records separate from those of any other entity. Except as expressly set forth herein, the Trust shall pay its
indebtedness, operating expenses and liabilities from its own funds, and the Trust shall not pay the indebtedness, operating expenses and liabilities of any other entity. The Master Servicer, on behalf of the Trust, shall maintain appropriate
minutes or other records of all appropriate action. The Trust shall maintain its office separate from the offices of the Sponsor, the Seller and the Master Servicer. 
  
 Notwithstanding the other provisions of this Section 5.01, the Owner Trustee shall not have the power, except upon the
written direction of the Certificateholders with the prior written consent of the Note Insurer, and to the extent otherwise consistent with the Basic Documents, to remove or replace the Master Servicer or the Indenture Trustee. 
  
 Section 5.02. Action by Certificateholders with Respect to Bankruptcy.
The Owner Trustee shall not have the power to (i) institute proceedings to have the Trust declared or adjudicated bankrupt or insolvent, (ii) consent to the institution of bankruptcy or insolvency proceedings against the Trust, (iii) file a petition
or consent to a petition seeking reorganization or relief on behalf of the Trust under any applicable federal or state law relating to bankruptcy, (iv) consent to the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or any
similar official) of the Trust or a substantial portion of the property of the Trust, (v) make any assignment for the benefit of the Trust’s creditors, (vi) cause the Trust to admit in writing its inability to pay its debts generally as they
become due, or (vii) take any action, or cause the Trust to take any action, in furtherance of any of the foregoing (any of the above, a “Bankruptcy Action”) without the unanimous prior written consent and approval of all
Certificateholders and the prior written consent and approval of the Note Insurer and the delivery to the Owner Trustee by each such 
  

 21 

 Certificateholder of a certification that such Certificateholder reasonably believes that the Trust is insolvent. So long
as the Indenture and the Insurance Agreement remain in effect and no Note Insurer Default exists, no Certificateholder shall have the power to take, and shall not take, any Bankruptcy Action with respect to the Trust or direct the Owner Trustee to
take any Bankruptcy Action with respect to the Trust. The terms of this Section 5.02 shall survive for one year and one day following the termination of this Agreement. 
  
 Section 5.03. Restrictions on Certificateholders’ Power. The Certificateholders shall not direct the Owner
Trustee to take or refrain from taking any action if such action or inaction would be contrary to any obligation of the Trust or the Owner Trustee under this Agreement or any of the other Basic Documents or would be contrary to Section 2.03, nor
shall the Owner Trustee be obligated to follow any such direction, if given. 
  
 Section 5.04. Majority Control. Except as expressly provided herein, any action that may be taken by the Certificateholders under this Agreement may be taken by the holders of Certificates evidencing more than
50% of the Percentage Interest in the Trust and such action shall be binding upon all Certificateholders. Except as expressly provided herein, any written notice of the Certificateholders delivered pursuant to this Agreement shall be effective if
signed by holders of Certificates evidencing more than 50% of the Percentage Interest in the Trust at the time of the delivery of such notice and such action shall be binding upon all Certificateholders. 
  
 ARTICLE VI 
  
 TAX PROVISIONS; CERTAIN DUTIES 
  
 Section 6.01. Federal Income Tax Provisions. (a) For so long as the
Trust has a single owner for federal income tax purposes, it will, pursuant to Treasury Regulations promulgated under section 7701 of the Code, be disregarded as an entity distinct from the Certificateholder for all federal income tax purposes.
Accordingly, for federal income tax purposes, the Certificateholder will be treated as (i) owning all assets owned by the Trust, (ii) having incurred all liabilities incurred by the Trust, and (iii) all transactions between the Trust and the
Certificateholder will be disregarded. 
  
 (b) Neither the Owner
Trustee nor any Certificateholder will, under any circumstances, and at any time, make an election of IRS Form 8832 or otherwise, to classify the Trust as an association taxable as a corporation for federal, state or any other applicable tax
purpose. 
  
 (c) If the Trust is treated as a partnership (rather
than disregarded as a separate entity) for federal income tax purposes pursuant to Section 2.06, the following provisions shall apply: 
  
 (i) A separate capital account (a “Capital Account”) shall be established and maintained for each Certificateholder by
the Sponsor, in accordance with Treasury Regulations Section 1.704-1 (b)(2)(iv). No Certificateholder shall be entitled to interest on its Capital Account or any capital contribution made by such Certificateholder to the Trust. 
  

 22 

 (ii) Upon termination of the Trust pursuant to Article X, any amounts available for
distribution to Certificateholders shall be distributed to the Certificateholders with positive Capital Account balances in accordance with such balances. For purposes of this Section 6.01(c)(ii), the Capital Account of each Certificateholder shall
be determined after all adjustments made in accordance with this Section 6.01 resulting from the Trust’s operations and from all sales and dispositions of all or any part of the assets of the Trust. Any distributions pursuant to this Section
6.01(c)(ii) shall be made by the end of the Taxable Year in which the termination occurs (or, if later, within 90 days after the date of the termination). 
  
 (iii) No Certificateholder shall be required to restore any deficit balance in its Capital Account. Furthermore, no Certificateholder
shall be liable for the return of the Capital Account of, or of any capital contribution made to the Trust by, another Certificateholder. 
  
 (iv) Profit and loss of the Trust for each Taxable Year shall be allocated to the Certificateholders in accordance with their respective
Percentage Interests. 
  
 (v) Notwithstanding any
provision to the contrary, (i) any expense of the Trust that is a “nonrecourse deduction” within the meaning of Treasury Regulations Section 1.704-2(b)(1) shall be allocated in accordance with the Certificateholders’ respective
Percentage Interests, (ii) any expense of the Trust that is a “partner nonrecourse deduction” within the meaning of Treasury Regulations Section 1.704-2(i)(2) shall be allocated in accordance with Treasury Regulations Section
1.704-2(i)(1), (iii) if there is a net decrease in Trust Minimum Gain within the meaning of Treasury Regulations Section 1.704-2(f)(1) for any Taxable Year, items of gain and income shall be allocated among the Certificateholders in accordance with
Treasury Regulations Section 1.704-2(f) and the ordering rules contained in Treasury Regulations Section 1.704-2(i), and (iv) if there is a net decrease in Certificateholder Nonrecourse Debt Minimum Gain within the meaning of Treasury Regulations
Section 1.704-2(i)(4) for any Taxable Year, items of gain and income shall be allocated among the Certificateholders in accordance with Treasury Regulations Section 1.704-2(i)(4) and the ordering rules contained in Treasury Regulations Section
1.704-2(j). A Certificateholder’s “interest in partnership profits” for purposes of determining its share of the nonrecourse liabilities of the Trust within the meaning of Treasury Regulations Section 1.752-3(a)(3) shall be such
Certificateholder’s Percentage Interest. 
  
 (vi) If a Certificateholder receives in any Taxable Year an adjustment, allocation, or distribution described in subparagraphs (4), (5), or (6) of Treasury Regulations Section 1.704-1(b)(2)(ii)(d) that causes or increases a negative balance
in such Certificateholder’s Capital Account that exceeds the sum of such Certificateholder’s shares of Trust Minimum Gain and Certificateholder Nonrecourse Debt Minimum Gain, as determined in accordance with Treasury Regulations Sections
1.704-2(g) and 1.704-2(i), such Certificateholder shall be allocated specially for such Taxable Year (and, if necessary, later Taxable Years) items of income and gain in an amount and manner sufficient to eliminate such negative Capital Account
balance as quickly as possible as provided in Treasury Regulations Section 1.704-1(b)(2)(ii)(d). After the occurrence of an 
  

 23 

 allocation of income or gain to a Certificateholder in accordance with this Section 6.01(c)(vi), to the
extent permitted by Regulations Section 1.704-1(b), items of expense or loss shall be allocated to such Certificateholder in an amount necessary to offset the income or gain previously allocated to such Certificateholder under this Section
6.01(c)(vi). 
  
 (vii) Loss shall not be
allocated to a Certificateholder to the extent that such allocation would cause a deficit in such Certificateholder’s Capital Account (after reduction to reflect the items described in Treasury Regulations Section 1.704-1(b)(2)(ii)(d)(4), (5)
and (6)) to exceed the sum of such Certificateholder’s shares of Trust Minimum Gain and Certificateholder Nonrecourse Debt Minimum Gain. Any loss in excess of that limitation shall be allocated to all the Certificateholders in accordance with
their respective Percentage Interests. After the occurrence of an allocation of loss to a Certificateholder in accordance with this Section 6.01(c)(vii), to the extent permitted by Treasury Regulations Section 1.704-1(b), profit shall be allocated
to such Certificateholder in an amount necessary to offset the loss previously allocated to such Certificateholder under this Section 6.01(c)(vii). 
  
 (viii) If a Certificateholder transfers any part or all of its Percentage Interest and the transferee is admitted as a Certificateholder
as provided herein (a “Transferee Certificateholder”), the distributive shares of the various items of profit and loss allocable among the Certificateholders during such Taxable Year shall be allocated between the transferor and the
Transferee Certificateholder (at the election of the Certificateholders (including the transferor, but excluding the Transferee Certificateholder)) either (i) as if the Taxable Year had ended on the date of the transfer or (ii) based on the number
of days of such Taxable Year that each was a Certificateholder without regard to the results of Trust activities in the respective portions of such Taxable Year in which the transferor and Transferee Certificateholder were Certificateholders.

  
 (ix) “Profit” and “loss”
and any items of income, gain, expense or loss referred to in this Section 6.01 shall be determined in accordance with federal income tax accounting principles as modified by Treasury Regulations Section 1.704-1(b)(2)(iv), except that profits and
losses shall not include items of income, gain, and expense that are specially allocated pursuant to Sections 6.01(c)(v), 6.01(c)(vi) or 6.01(c)(vii) hereof. All allocations of income, profits, gains, expenses, and losses (and all items contained
therein) for federal income tax purposes shall be identical to all allocations of such items set forth in this Section 6.01, except as otherwise required by Section 704(c) of the Code and Section 1.704-1(b)(4) of the Treasury Regulations.

  
 (x) The taxable year of the Trust (the
“Taxable Year”) shall be the calendar year or such other taxable year as may be required by Section 706(b) of the Code. 
  
 (xi) At the Trust’s expense, the Sponsor shall (i) prepare, or cause to be prepared, and file or cause to be filed such tax returns
relating to the Trust (including a partnership information return, IRS Form 1065) as are required by applicable federal, state, and local law, (ii) cause such returns to be signed in the manner required by law, (iii) make such elections as may from
time to time be required or appropriate under any 
  

 24 

 applicable law so as to maintain the Trust’s classification as a partnership for tax purposes, (iv)
prepare and deliver, or cause to be prepared and delivered, to the Certificateholders, no later than 120 days after the close of each Taxable Year (or no later than April l5th), a Schedule K-1, a copy of the Trust’s informational tax return
(IRS Form 1065), and such other reports (collectively, the “Annual Tax Reports”) setting forth in sufficient detail all such information and data with respect to the transactions effected by or involving the Trust during such
Taxable Year as shall enable each Certificateholder to prepare its federal, state, and local income tax returns in accordance with the laws then prevailing, and (v) collect, or cause to be collected, any withholding tax as described in Section
5.02(c) with respect to income or distributions to Certificateholders. 
  
 (xii) The Sponsor shall, if required, be designated as the tax matters partner for the Trust within the meaning of Section 6231(a)(7) of the Code (the “Tax Matters Partner”). The Tax Matters Partner
shall have the right and obligation to take all actions authorized and required, respectively, by the Code for the Tax Matters Partner. The Tax Matters Partner shall have the right to retain professional assistance in respect of any audit or
controversy proceeding initiated with respect to the Trust by the Internal Revenue Service or any state or local taxing authority, and all expenses and fees incurred by the Tax Matters Partner on behalf of the Trust shall constitute expenses of the
Trust. In the event the Tax Matters Partner receives notice of a final partnership adjustment under Section 6223(a)(2) of the Code, the Tax Matters Partner shall either (i) file a court petition for judicial review of such adjustment within the
period provided under Section 6226(a) of the Code, a copy of which petition shall be mailed to all other Holders on the date such petition is filed, or (ii) mail a written notice to all other Holders, within such period, that describes the Tax
Matters Partner’s reasons for determining not to file such a petition. 
  
 (xiii) Except as otherwise provided in this Section 6.01 and Section 7.06, the Certificateholders shall instruct the Sponsor in writing as to whether to make any available election under the Code or any applicable
state or local tax law on behalf of the Trust. 
  
 Section 6.02.
Withholding Taxes. In the event that any withholding tax is imposed under federal, state, or local law on the Trust’s payment (or allocations of income) to a Certificateholder, such tax shall reduce the amount otherwise distributable to
such Certificateholder in accordance with this Section 6.02. The Indenture Trustee, on behalf of the Owner Trustee, is hereby authorized and directed to retain in the Payment Account from amounts otherwise distributable to the Certificateholders
sufficient funds for the payment of any tax that is legally owed by the Trust (but such authorization shall not prevent the Indenture Trustee from contesting any such tax in appropriate proceedings, and withholding payment of such tax, if permitted
by law, pending the outcome of such proceedings). The Sponsor will provide the Indenture Trustee with a statement indicating the amount of any such withholding tax. The amount of any withholding tax imposed with respect to a Certificateholder shall
be treated as cash distributed to such Certificateholder at the time it is withheld by the Indenture Trustee and remitted to the appropriate taxing authority from the Payment Account at the direction of the Indenture Trustee, on behalf of the Owner
Trustee. If there is a possibility that withholding tax is payable with respect to a distribution (such as a distribution to a Certificateholder who is a 
  

 25 

 Non-U.S. Person), the Indenture Trustee may in its sole discretion withhold such amounts in accordance with this
paragraph. In the event that a Certificateholder wishes to apply for a refund of any such withholding tax, the Owner Trustee and the Indenture Trustee shall reasonably cooperate with such Certificateholder in making such claim so long as such
Certificateholder agrees in writing to reimburse the Owner Trustee for any out-of-pocket expenses incurred. 
  
 Any Certificateholder which is organized under the laws of a jurisdiction outside the United States shall, on or prior to the date such Certificateholder
becomes a Certificateholder, (a) so notify the Owner Trustee and the Indenture Trustee, on behalf of the Trust, (b) (i) provide the Owner Trustee and the Indenture Trustee, on behalf of the Trust, with Internal Revenue Service form W-8, or (ii)
notify the Owner Trustee and the Indenture Trustee, on behalf of the Trust, that it is not entitled to an exemption from United States withholding tax or a reduction in the rate thereof on payments of interest. Any such Certificateholder agrees by
its acceptance of a Certificate, on an ongoing basis, to provide like certification for each taxable year and to notify the Owner Trustee and the Indenture Trustee, on behalf of the Trust, should subsequent circumstances arise affecting the
information provided. The Trust, the Owner Trustee and the Indenture Trustee shall be fully protected in relying upon, and each Certificateholder by its acceptance of a Certificate hereunder agrees to indemnify and hold the Trust, the Owner Trustee
and the Indenture Trustee harmless against all claims or liability of any kind arising in connection with or related to their reliance upon any documents, forms or information provided by any Certificateholder. In addition, if the Indenture Trustee
has not withheld taxes on any payment made to any Certificateholder, and the Indenture Trustee is subsequently required to remit to any taxing authority any such amount not withheld, such Certificateholder shall return such amount to the Indenture
Trustee upon written demand by the Indenture Trustee. Neither the Owner Trustee nor the Indenture Trustee shall be liable for damages to any Certificateholder due to a violation of the Code unless and only to the extent such liability is caused by
the Owner Trustee’s or the Indenture Trustee’s failure to act in accordance with its standard of care under this Agreement. 
  
 Section 6.03. Accounting and Reports to the Certificateholders, the Internal Revenue Service and Others. The Sponsor shall (a) maintain (or cause
to be maintained) the books of the Trust on a calendar year basis on the accrual method of accounting, including, without limitation, the allocations of net income under Section 6.01, and (b) deliver (or cause to be delivered) to each
Certificateholder such information, reports or statements as may be required by the Code and applicable Treasury Regulations and as may be required to enable each Certificateholder to prepare its respective federal and state income tax returns.
Consistent with the Trust’s (and each Loan Groups’ and Sub-Trusts’) characterization for tax purposes as a security arrangement for the issuance of non-recourse debt, no federal income tax return shall be filed on behalf of the Trust
unless either (y) the Trust, the Sub-Trusts, the Owner Trustee or the Certificateholders receive an Opinion of Counsel based on a change in applicable law occurring after the date hereof that the Code requires such a filing or (z) the Internal
Revenue Service shall determine that the Trust (or a related Loan Group or Sub-Trust) is required to file such a return. In the event that the Trust (or a related Loan Group or Sub-Trust) is required to file tax returns, the Owner Trustee shall
elect under Section 1278 of the Code to include in income currently any market discount that accrues with respect to the Mortgage Loans. The Owner Trustee shall prepare or shall cause to be prepared any tax returns required to be filed by the Trust
or the Sub-Trusts and shall remit such returns to the Sponsor at least five days before such returns are due to 
  

 26 

 be filed. The Sponsor, or any other such party required by law, shall promptly sign such returns and deliver such returns
after signature to the Owner Trustee and such returns shall be filed by, or at the direction of, the Owner Trustee with the appropriate tax authorities. In no event shall the Sponsor be liable for any liabilities, costs or expenses of the Trust or
the Sub-Trusts arising out of the application of any tax law, including federal, state, foreign or local income or excise taxes or any other tax imposed on or measured by income (or any interest, penalty or addition with respect thereto or arising
from a failure to comply therewith), except for any such liability, cost or expense attributable to the Sponsor’s breach of its obligations under this Agreement. 
  
 ARTICLE VII 
  
 AUTHORITY AND DUTIES OF OWNER TRUSTEE 
  
 Section 7.01. General Authority. The Owner Trustee is authorized and directed to execute and deliver or cause to be executed and delivered the
Notes, the Certificates and the Basic Documents to which the Trust is to be a party and each certificate or other document attached as an exhibit to or contemplated by the Basic Documents to which the Trust is to be a party and any amendment or
other agreement or instrument described in Article IV, in each case, as the Sponsor shall approve, as evidenced conclusively by the Owner Trustee’s execution thereof. In addition, the Owner Trustee is authorized and directed, on behalf of the
Trust, to execute and deliver to the Authenticating Agent the Trust Request and the Trust Orders referred to in Section 2.11 of the Indenture, directly to the Authenticating Agent to authenticate and deliver Class A-1 Notes in the Original Note
Principal Balance of $250,121,000 and the Class A-2 Notes in the Original Note Principal Balance of $254,879,000. In addition to the foregoing, the Owner Trustee is authorized, but shall not be obligated, to take all actions required of the Trust,
pursuant to the Basic Documents. 
  
 Section 7.02. General
Duties. (a) It shall be the duty of the Owner Trustee: 
  
 (i) to discharge (or cause to be discharged) all of its responsibilities pursuant to the terms of this Agreement and the Basic Documents to which the Trust is a party and to administer the Trust in the interest of the
Certificateholders, subject to the Basic Documents and in accordance with the provisions of this Agreement; and 
  
 (ii) to maintain the Trust’s existence as a statutory trust under the laws of the State of Delaware. 
  
 (b) The Owner Trustee shall not be responsible for taking any action on
behalf of the Trust under any Basic Document unless specifically directed in writing to do so in accordance with Section 7.03 of this Agreement. 
  
 (c) The Owner Trustee shall not be responsible for any matter regarding the Securities Act, the Exchange Act or the Investment Company Act of 1940, as
amended, or the rules or regulations thereunder. 
  
 Section 7.03.
Action upon Instruction. (a) Subject to Article V hereof, and in accordance with the terms of the Basic Documents, the Certificateholders may by written instruction direct the Owner Trustee in the management of the Trust but only to the
extent 
  

 27 

 consistent with the limited purpose of the Trust. Such direction may be exercised at anytime by written instruction of
the Certificateholders pursuant to Article V hereof. Without limiting the generality of the foregoing, the Owner Trustee shall act as directed in writing by the Certificateholders in connection with Note redemptions requested by the
Certificateholders, and shall take all actions and deliver all documents that the Trust is required to take and deliver in accordance with Section 4.01 and Article X of the Indenture in order to effect any redemption requested by the
Certificateholders. 
  
 (b) The Owner Trustee shall not be
required to take any action hereunder or under any other Basic Document if the Owner Trustee shall have reasonably determined, or shall have been advised by counsel, that such action is likely to result in liability on the part of the Owner Trust or
is contrary to the terms hereof or of any other Basic Document or is otherwise contrary to law. 
  
 (c) Subject to Article V hereof, whenever the Owner Trustee is unable to decide between alternative courses of action permitted or required by the terms
of this Agreement or under any other Basic Document, the Owner Trustee shall promptly give notice (in such form as shall be appropriate under the circumstances) to the Certificateholders and the Note Insurer requesting instruction from the
Certificateholders as to the course of action to be adopted, and to the extent the Owner Trustee acts in good faith in accordance with any written instruction of the Certificateholders received, the Owner Trustee shall not be liable on account of
such action to any Person. If the Owner Trustee shall not have received appropriate instruction within ten (10) days of such notice (or within such shorter period of time as reasonably may be specified in such notice or may be necessary under the
circumstances) it may, but shall be under no duty to, take or refrain from taking such action, not inconsistent with this Agreement or the Basic Documents, as it shall deem to be in the best interests of the Certificateholders, and shall have no
liability to any Person for such action or inaction. 
  
 (d)
Subject to Article V hereof, in the event that the Owner Trustee is unsure as to the application of any provision of this Agreement or any other Basic Document or any such provision is ambiguous as to its application, or is, or appears to be, in
conflict with any other applicable provision, or in the event that this Agreement permits any determination by the Owner Trustee or is silent or is incomplete as to the course of action that the Owner Trustee is required to take with respect to a
particular set of facts, the Owner Trustee may give notice (in such form as shall be appropriate under the circumstances) to the Certificateholders requesting instruction and, to the extent that the Owner Trustee acts or refrains from acting in good
faith in accordance with any such instruction received, the Owner Trustee shall not be liable, on account of such action or inaction, to any Person. If the Owner Trustee shall not have received appropriate instruction within ten (10) days of such
notice (or within such shorter period of time as reasonably may be specified in such notice or may be necessary under the circumstances) it may, but shall be under no duty to, take or refrain from taking such action, not inconsistent with this
Agreement or the other Basic Documents, as it shall deem to be in the best interests of the Certificateholders, and shall have no liability to any Person for such action or inaction. 
  

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 Section 7.04. No Duties Except as Specified in this Agreement, the Basic Documents or any
Instructions. 
  
 (a) The Owner Trustee shall not have any
duty or obligation to manage, make any payment with respect to, register, record, sell, dispose of, or otherwise deal with the Owner Trust Estate, or to otherwise take or refrain from taking any action under, or in connection with, this Agreement or
any document contemplated hereby to which the Trust is a party, except as expressly provided by the terms of this Agreement, any other Basic Document or in any document or written instruction received by the Owner Trustee pursuant to Section 7.03;
and no implied duties or obligations shall be read into this Agreement or any other Basic Document against the Owner Trustee. The Owner Trustee shall have no responsibility for filing any financing or continuation statement in any public office at
any time or to otherwise perfect or maintain the perfection of any security interest or lien granted to it hereunder or to prepare or file any Securities and Exchange Commission filing for the Trust or to record this Agreement or any other Basic
Document. The Owner Trustee nevertheless agrees that it will, at its own cost and expense, promptly take all action as may be necessary to discharge any liens on any part of the Owner Trust Estate that result from actions by, or claims against, the
Owner Trustee in its individual capacity that are not related to the ownership or the administration of the Owner Trust Estate. 
  
 (b) Notwithstanding anything to the contrary herein or in any other document, the Owner Trustee shall not be required to execute, deliver or certify on
behalf of the Trust or any other Person any filings, certificates, affidavits or other instruments required under the Sarbanes-Oxley Act of 2002. Notwithstanding any Person’s right to instruct the Owner Trustee, neither the Owner Trustee nor
any agent, employee, director or officer of the Owner Trustee shall have any obligation to execute any certificates or other documents required pursuant to the Sarbanes-Oxley Act of 2002 or the rules and regulations promulgated thereunder, and the
refusal to comply with any such instructions shall not constitute a default or breach under any Basic Document. 
  
 Section 7.05. No Action Except under Specified Documents or Instructions. The Owner Trustee shall not manage, control, use, sell, dispose of or
otherwise deal with any part of the Owner Trust Estate except (i) in accordance with the powers granted to and the authority conferred upon the Owner Trustee pursuant to this Agreement, (ii) in accordance with the other Basic Documents and (iii) in
accordance with any document or written instruction delivered to the Owner Trustee pursuant to Section 7.03. 
  
 Section 7.06. Restrictions. Neither the Owner Trustee nor the Sponsor shall take any action (a) that violates or results in a breach of or is
inconsistent with the purposes of the Trust set forth in Section 2.03 or (b) that, to the actual knowledge of the Sponsor and the Owner Trustee, would result in the Trust’s becoming taxable as a corporation for Federal income tax purposes. The
Certificateholders shall not direct the Owner Trustee to take action that would violate the provisions of this Section 7.06. 
  

 29 

 ARTICLE VIII 
  
 CONCERNING THE OWNER TRUSTEE 
  

Section 8.01. Acceptance of Trusts and Duties. The Owner Trustee accepts the trusts hereby created and agrees to perform its duties hereunder
with respect to such trusts, but only upon the terms of this Agreement subject to the other Basic Documents. The Owner Trustee also agrees to disburse all moneys actually received by it constituting part of the Owner Trust Estate upon the terms of
the other Basic Documents and this Agreement. The Owner Trustee shall not be answerable or accountable hereunder or under any other Basic Document under any circumstances, except (i) for its own willful breach or misconduct or gross negligence or
(ii) in the case of the inaccuracy of any representation or warranty contained in Section 8.03 expressly made by the Owner Trustee in its individual capacity. In particular, but not by way of limitation (and subject to the exceptions set forth in
the preceding sentence): 
  
 (a) The Owner Trustee shall not be
liable for any error of judgment made by a Responsible Officer of the Owner Trustee; 
  
 (b) The Owner Trustee shall not be liable with respect to any action taken or omitted to be taken by it in accordance with the instructions of the Certificateholders or the Note Insurer given in accordance with this
Agreement; 
  
 (c) No provision of this Agreement or any other
Basic Document shall require the Owner Trustee to expend or risk funds or otherwise incur any financial liability in the performance of any of its rights or powers hereunder or under any other Basic Document if the Owner Trustee shall have
reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured or provided to it; 
  

(d) Under no circumstances shall the Owner Trustee be liable for indebtedness evidenced by or arising under any of the Basic Documents, including the
principal of and interest on the Notes; 
  
 (e) The Owner Trustee
shall not be responsible for or in respect of the validity or sufficiency of this Agreement or for the due execution hereof by the Sponsor or for the form, character, genuineness, sufficiency, value or validity of any of the Owner Trust Estate or
for or in respect of the validity or sufficiency of the Basic Documents, other than the certificate of authentication on the Certificates, and the Owner Trustee shall in no event assume or incur any liability, duty, or obligation to any Noteholder
or to any Certificateholders, other than as expressly provided for herein and in the other Basic Documents; 
  
 (f) The Owner Trustee shall not be liable for the default or misconduct of the Indenture Trustee or the Master Servicer under any of the Basic Documents
or otherwise and the Owner Trustee shall have no obligation or liability to perform the obligations of the Trust under this Agreement or the other Basic Documents that are required to be performed by the Sponsor, the Indenture Trustee or the Master
Servicer; 
  
 (g) The Owner Trustee shall be under no obligation
to exercise any of the rights or powers vested in it by this Agreement, or to institute, conduct or defend any litigation under this 
  

 30 

 Agreement or otherwise or in relation to this Agreement or any Basic Document, at the request, order or direction of the
Sponsor, any of the Certificateholders or the Note Insurer, unless such Certificateholders, the Sponsor or the Note Insurer have offered to the Owner Trustee security or indemnity reasonably satisfactory to it against the costs, expenses and
liabilities that may be incurred by the Owner Trustee therein or thereby. The right of the Owner Trustee to perform any discretionary act enumerated in this Agreement or in any other Basic Document shall not be construed as a duty, and the Owner
Trustee shall not be answerable for other than its gross negligence or willful breach or misconduct in the performance of any such act; and 
  
 (h) Notwithstanding anything contained herein to the contrary, neither U.S. Bank Trust National Association in its individual capacity nor as Owner
Trustee shall be required to take any action in any jurisdiction other than in the State of Delaware if the taking of such action will (i) require the consent or approval or authorization or order of or the giving of notice to, or the registration
with or the taking of any other action in respect of, any state or other governmental authority or agency of any jurisdiction other than the State of Delaware; (ii) result in any fee, tax or other governmental charge under the laws of any
jurisdiction or any political subdivisions thereof in existence on the date hereof other than the State of Delaware becoming payable by U.S. Bank Trust National Association; or (iii) subject U.S. Bank Trust National Association to personal
jurisdiction in any jurisdiction other than the State of Delaware for causes of action arising from acts unrelated to the consummation of the transactions by U.S. Bank Trust, National Association in its individual capacity or as Owner Trustee, as
the case may be, contemplated hereby. The Owner Trustee shall be entitled to obtain advice of counsel (which advice shall be an expense of the Sponsor to determine whether any action required to be taken pursuant to this Agreement or the other Basic
Documents results in the consequences described in clauses (i), (ii) and (iii) of the preceding sentence. In the event that said counsel advises the Owner Trustee that such action will result in such consequences, the Owner Trustee will appoint an
additional trustee pursuant to Section 11.05 hereof to proceed with such action. 
  
 Section 8.02. Furnishing of Documents. Subject to Section 4.07, the Owner Trustee shall furnish to the Certificateholders promptly upon receipt of a written request therefor, duplicates or copies of all
reports, notices, requests, demands, certificates, financial statements and any other instruments furnished to the Owner Trustee under the Basic Documents. On behalf of the Owner Trustee, the Sponsor shall furnish to Noteholders promptly upon
written request therefor, copies of the Sale and Servicing Agreement and the Indenture. 
  
 Section 8.03. Representations and Warranties of the Owner Trustee. The Owner Trustee hereby represents and warrants to the Sponsor, the Note Insurer and the Certificateholders, that: 
  
 (a) It is a national banking association duly organized and validly existing
in good standing under the laws of the United States of America. It has all requisite power and authority to execute, deliver and perform its obligations under this Agreement. 
  
 (b) It has taken all action necessary to authorize the execution and delivery by it of this Agreement, and this Agreement
will be executed and delivered by one of its officers who is duly authorized to execute and deliver this Agreement on its behalf. 
  

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 (c) Neither the execution nor the delivery by it of this Agreement nor the consummation by it of the
transactions contemplated hereby nor compliance by it with any of the terns or provisions hereof will contravene any Delaware or Federal law, governmental rule or regulation governing the banking or trust powers of the Owner Trustee or any judgment
or order binding on it, or constitute any default under its charter documents or by-laws. 
  
 (d) This Agreement has been duly authorized, executed and delivered by the Owner Trustee and constitutes a valid, legal and binding obligation of the Owner Trustee, 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. 
  
 (e) The Owner Trustee 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 Owner Trustee or its properties or might have consequences that would materially adversely affect its performance hereunder. 
  
 (f) No litigation is pending or, to the best of the Owner Trustee’s knowledge, threatened against the Owner Trustee
which would prohibit its entering into this Agreement or performing its obligations under this Agreement. 
  
 Section 8.04. Reliance; Advice of Counsel. (a) The Owner Trustee shall incur no liability to anyone in acting upon any signature, instrument,
notice, resolution, request, consent, order, certificate, report, opinion, Note, or other document or paper believed by it in good faith to be genuine and believed by it in good faith to be signed by the proper party or parties. The Owner Trustee
may accept a certified copy of a resolution of the board of directors or other governing body of any corporate party as conclusive evidence that such resolution has been duly adopted by such body and that the same is in full force and effect. As to
any fact or matter the method of the determination of which is not specifically prescribed herein, the Owner Trustee may for all purposes hereof rely on a certificate, signed by the president or any vice president or by the treasurer or other
authorized officers of the relevant party, as to such fact or matter and such certificate shall constitute full protection to the Owner Trustee for any action taken or omitted to be taken by it in good faith in reliance thereon. 
  
 (b) In the exercise or administration of the trusts hereunder and in the
performance of its duties and obligations under this Agreement or the other Basic Documents, the Owner Trustee (i) may, at the expense of the Trust, act directly or through its agents or attorneys pursuant to agreements entered into with any of
them, and the Owner Trustee shall not be liable for the conduct or misconduct of such agents or attorneys if such agents or attorneys shall have been selected by the Owner Trustee with reasonable care, and (ii) may, at the expense of the Trust,
consult with counsel, Accountants and other skilled persons to be selected with reasonable care and employed by it. The Owner Trustee shall not be liable for anything done, suffered or omitted in good faith by it in accordance with the written
opinion or advice of any such counsel, Accountants or other such persons and not contrary to this Agreement or any other Basic Document. 
  

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 Section 8.05. Not Acting in Individual Capacity. Except as provided in Section 8.03, in accepting
the trusts hereby created, U.S. Bank Trust National Association acts solely as Owner Trustee hereunder and not in its individual capacity, and all Persons having any claim against the Owner Trustee by reason of the transactions contemplated by this
Agreement or any other Basic Document shall look only to the Owner Trust Estate for payment or satisfaction thereof. 
  
 Section 8.06. Owner Trustee Not Liable for the Certificates or Mortgage Loans. The recitals contained herein and in the Certificates (other than
the signature and countersignature of the Owner Trustee on the Certificates) shall be taken as the statements of the Sponsor, and the Owner Trustee assumes no responsibility for the correctness thereof. The Owner Trustee makes no representations as
to the validity or sufficiency of this Agreement, of any other Basic Document or of the Certificates (other than the signature and countersignature of the Owner Trustee on the Certificates and as specified in Section 8.03 hereof) or the Notes, or of
any Mortgage Loans or related documents. The Owner Trustee shall at no time have any responsibility or liability for or with respect to the legality, validity and enforceability of any Mortgage Loan, or the perfection and priority of any security
interest created by any Mortgage Loan or the maintenance of any such perfection and priority, or for or with respect to the sufficiency of the Owner Trust Estate or its ability to generate the payments to be distributed to the Certificateholders
under this Agreement or the Noteholders under the Indenture, including, without limitation, the existence, condition and ownership of any Mortgaged Property, the existence and enforceability of any insurance thereon, the existence and contents of
any Mortgage Loan on any computer or other record thereof, the validity of the assignment of any Mortgage Loan to the Trust or of any intervening assignment, the completeness of any Mortgage Loan, the performance or enforcement of any Mortgage Loan,
the compliance by the Sponsor or the Master Servicer with any warranty or representation made under any Basic Document or in any related document or the accuracy of any such warranty or representation or any action of the Indenture Trustee or the
Master Servicer or any subservicer taken in the name of the Owner Trustee. 
  
 Section 8.07. Owner Trustee May Own Certificates and Notes. The Owner Trustee in its individual or any other capacity may become the owner or pledgee of the Certificates or the Notes and may deal with the
Sponsor, the Indenture Trustee, the Master Servicer and the Backup Servicer in banking transactions with the same rights as it would have if it were not Owner Trustee. 
  
 Section 8.08. Licenses. The Sponsor shall cause the Trust to use its best efforts to obtain and maintain the
effectiveness of any licenses required in connection with this Agreement and the other Basic Documents and the transactions contemplated hereby and thereby until such time as the Trust shall terminate in accordance with the terms hereof. 

 
 ARTICLE IX 
  
 COMPENSATION OF OWNER TRUSTEE 
  
 Section 9.01. Owner Trustee’s Fees and Expenses. The Owner
Trustee shall receive as compensation for its services hereunder such fees as have been separately agreed upon before the date hereof between the Master Servicer and the Owner Trustee, and the Owner Trustee shall be entitled to be reimbursed by the
Master Servicer for its other reasonable expenses hereunder as separately agreed (the “Owner Trustee Fee”). 
  

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 Section 9.02. Indemnification. The Sponsor shall be liable as obligor for, and shall indemnify the
Owner Trustee (in its individual and trust capacities) and its successors, assigns, agents and servants (collectively, the “Indemnified Parties”) from and against, any and all liabilities, obligations, losses, damages, taxes,
claims, actions and suits, and any and all reasonable costs, expenses and disbursements (including reasonable legal fees and expenses) of any kind and nature whatsoever (collectively, “Expenses”) which may at any time be imposed on,
incurred by, or asserted against any Indemnified Party in any way relating to or arising out of this Agreement, the other Basic Documents, the Owner Trust Estate, the administration of the Owner Trust Estate or the action or inaction of the Owner
Trustee hereunder, except only that the Sponsor shall not be liable for or required to indemnify an Indemnified Party from and against Expenses arising or resulting from any of the matters described in the third sentence of Section 8.01. The
indemnities contained in this Section 9.02 shall survive the resignation or termination of the Owner Trustee or the termination of this Agreement. In any event of any claim, action or proceeding for which indemnity will be sought pursuant to this
Section, the Sponsor will be entitled to participate therein, with counsel selected by the Sponsor and reasonably satisfactory to the Indemnified Parties, but after notice from an Indemnified Party to the Sponsor of its election to assume the
defense thereof, the Sponsor shall not be liable to the Indemnified Party under this Section 9.02 for any legal or other expenses subsequently incurred by such Indemnified Party in connection with the defense of such action; provided,
however, that this sentence shall not be in effect if (1) the Sponsor shall not have employed counsel reasonably satisfactory to the Indemnified Party to represent the Indemnified Party within a reasonable time after notice of commencement of
the action, (2) the Sponsor shall have authorized the employment of counsel for the Indemnified Party at the expense of the Sponsor or (3) in the event any such claim involves a possible imposition of criminal liability or penalty or a material
civil penalty on such Indemnified Party, a conflict of interest between such Indemnified Party and the Sponsor or another indemnitee or the granting of material injunctive relief against such Indemnified Party, and such Indemnified Party informs the
Sponsor that such Indemnified Party desires to be represented by separate counsel, in which case, the reasonable fees and expenses of such separate counsel shall be borne by the Sponsor. If the Sponsor assumes the defense of any such proceeding, the
Sponsor shall be entitled to settle such proceeding without any liability being assessed against any Indemnified Party or, if such settlement provides for release of any such Indemnified Party without any liability being assessed against any
Indemnified Party in connection with all matters relating to the proceeding which have been asserted against such Indemnified Party in such proceeding by the other parties to such settlement, without the prior written consent of such Indemnified
Party, but otherwise only with the prior written consent of such Indemnified Party. 
  
 Section 9.03. Payments to the Owner Trustee. Any amounts paid to the Owner Trustee pursuant to this Article IX shall be deemed not to be a part of the Owner Trust Estate immediately after such payment.

  

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 ARTICLE X 
  

TERMINATION OF TRUST AGREEMENT 
  
 Section 10.01. Termination of Trust Agreement. (a) This Agreement (other than Article IX) shall terminate and the Trust shall dissolve and be of no
further force or effect on the earlier of: (i) the final payment or other liquidation of the Mortgage Loans and the disposition of all REO Properties and the remittance of all funds due hereunder with respect to such Mortgage Loans and REP
Properties after the satisfaction and discharge of the Indenture pursuant to Section 4.01 of the Indenture; and (ii) the expiration of 21 years from the death of the last survivor of descendants of Joseph P. Kennedy (the late ambassador of the
United States to the Court of St. James). The bankruptcy, liquidation, dissolution, death or incapacity of the any Certificateholder or the Sponsor shall not (x) operate to terminate this Agreement or the Trust, nor (y) entitle
Certificateholders’ or the Sponsor’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 all or any part of the Trust or Owner Trust Estate nor (z)
otherwise affect the rights, obligations and liabilities of the parties hereto. 
  
 (b) Except as provided in Section 10.01(a) above, none of the Sponsor, the Master Servicer, the Backup Servicer, the Note Insurer nor the Certificateholders shall be entitled to revoke or terminate the Trust.

  
 (c) Notice of any termination of the Trust, specifying the
Payment Date upon which the Certificateholders shall surrender their Certificates to the Indenture Trustee for payment of the final distributions and cancellation, shall be given by the Owner Trustee to the Certificateholders, the Note Insurer, the
Rating Agencies and the Indenture Trustee mailed within five (5) Business Days of receipt by the Owner Trustee from the Master Servicer of notice of such termination, which notice given by the Owner Trustee shall state (i) the Payment Date upon or
with respect to which final payment of the Certificates shall be made upon presentation and surrender of the Certificates at the office of the Indenture Trustee therein designated, (ii) the amount of any such final payment and (iii) that the Record
Date otherwise applicable to such Payment Date is not applicable, payments being made only upon presentation and surrender of the Certificates at the office of the Indenture Trustee therein specified. The Owner Trustee shall give such notice to the
Certificate Registrar (if other than the Owner Trustee) and the Indenture Trustee at the time such notice is given to Certificateholders. Upon presentation and surrender of Certificates, subject to Section 3808 of the Statutory Trust Statute,
amounts distributable on such Payment Date pursuant to the terms of the Indenture. 
  
 (d) In the event that Certificateholders shall not surrender their Certificates for cancellation within six months after the date specified in the above mentioned written notice, the Owner Trustee shall give a second
written notice to Certificateholders to surrender the Certificates for cancellation and receive the final distribution with respect thereto. If within one year after the second notice the Ownership Interest shall not have been surrendered for
cancellation, the Owner Trustee may take appropriate steps, or may appoint an agent to take appropriate steps, to contact the remaining Certificateholders concerning surrender of the Certificates, and the cost thereof shall be paid out of the funds
and other assets that shall remain subject to this Agreement. Any funds remaining in the Trust after exhaustion of such remedies shall be distributed by the Indenture Trustee to the Certificateholders. 
  

 35 

 (e) Upon the winding up of the Trust in accordance with Section 3808 of the Statutory Trust Statute and
its termination, the Owner Trustee shall cause the Certificate of Trust to be canceled by filing a certificate of cancellation with the Secretary of State in accordance with the provisions of Section 3810 of the Statutory Trust Statute. 

 
 ARTICLE XI 
  
 SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES 
  
 Section 11.01. Eligibility Requirements for Owner Trustee. The Owner
Trustee shall at all times be a corporation or banking association satisfying the provisions of Section 3807(a) of the Statutory Trust Statute; authorized to exercise trust powers; having a combined capital and surplus of at least $50,000,000 and
subject to supervision or examination by Federal or state authorities; and having (or having a parent that has) a rating of at least “Baa3” by Moody’s and “A-1” by S&P (or otherwise acceptable to the Rating Agencies) and
being acceptable to the Note Insurer. If such entity shall publish reports of condition at least annually, pursuant to law or to the requirements of the aforesaid supervising or examining authority, then for the purpose of this Section 11.01, the
combined capital and surplus of such entity 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 Owner Trustee shall cease to be eligible in accordance with
the provisions of this Section 11.01, the Owner Trustee shall resign immediately in the manner and with the effect specified in Section 11.02. 
  
 Section 11.02. Resignation or Removal of Owner Trustee. The Owner Trustee may at any time resign and be discharged from the trusts hereby created
by giving written notice thereof to the Trust, the Sponsor, the Master Servicer, the Backup Servicer, the Indenture Trustee and the Note Insurer. Upon receiving such notice of resignation, the Note Insurer may (and, if the Note Insurer fails to do
so, the Sponsor shall promptly) appoint a successor Owner Trustee (acceptable to the Note Insurer) by written instrument, in duplicate, one copy of which instrument shall be delivered to the resigning Owner Trustee and one copy to the successor
Owner Trustee. If no successor Owner Trustee shall have been so appointed and have accepted appointment within thirty (30) days after the giving of such notice of resignation, the resigning Owner Trustee or the Note Insurer may petition any court of
competent jurisdiction for the appointment of a successor Owner Trustee. 
  
 If at any time the Owner Trustee shall cease to be eligible in accordance with the provisions of Section 11.01 and shall fail to resign after written request therefor by the Certificateholders or the Sponsor, or if at
any time the Owner Trustee shall be legally unable to act, or shall be adjudged bankrupt or insolvent, or a receiver of the Owner Trustee or of its property shall be appointed, or any public officer shall take charge or control of the Owner Trustee
or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, then the Note Insurer, or the Certificateholders or the Sponsor with the written consent of the Note Insurer, may remove the Owner Trustee. If the
Certificateholders or the Sponsor or the Note Insurer shall remove the Owner Trustee under the authority of the immediately preceding 
  

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 sentence, the Note Insurer, or the Sponsor with the written consent of the Note Insurer, shall promptly appoint a
successor Owner Trustee by written instrument in duplicate, one copy of which instrument shall be delivered to the outgoing Owner Trustee so removed and one copy to the successor Owner Trustee and payment of all fees owed to the outgoing Owner
Trustee. 
  
 Any resignation or removal of the Owner Trustee and
appointment of a successor Owner Trustee pursuant to any of the provisions of this Section 11.02 shall not become effective until acceptance of appointment by the successor Owner Trustee pursuant to Section 11.03, written approval by the Note
Insurer and payment of all fees and expenses owed to the outgoing Owner Trustee. The Master Servicer shall provide notice of such resignation or removal of the Owner Trustee to each of the Rating Agencies, the Indenture Trustee and the Note Insurer.

  
 Section 11.03. Successor Owner Trustee. Any successor
Owner Trustee appointed pursuant to Section 11.02 shall execute, acknowledge and deliver to the Trust, the Sponsor, the Indenture Trustee, the Note Insurer and to its predecessor Owner Trustee an instrument accepting such appointment under this
Agreement, and thereupon, subject to the payment of all fees and expenses owed to the outgoing Owner Trustee, the resignation or removal of the predecessor Owner Trustee shall become effective and such successor Owner Trustee (if acceptable to the
Note Insurer), without any further act, deed or conveyance, shall become fully vested with all the rights, powers, duties, and obligations of its predecessor under this Agreement, with like effect as if originally named as Owner Trustee. The
predecessor Owner Trustee shall upon payment of its fees and expenses deliver to the successor Owner Trustee all documents and statements and moneys held by it under this Agreement; and the Sponsor and the predecessor Owner Trustee shall execute and
deliver such instruments and do such other things as may reasonably be required for fully and certainly vesting and confirming in the successor Owner Trustee all such rights, powers, duties, and obligations. 
  
 No successor Owner Trustee shall accept appointment as provided in this
Section unless at the time of such acceptance such successor Owner Trustee shall be eligible pursuant to Section 11.01. 
  
 Upon acceptance of appointment by a successor Owner Trustee pursuant to this Section 11.03, the Sponsor shall mail notice of the successor of such Owner
Trustee to the Certificateholders, the Indenture Trustee, the Noteholders, the Note Insurer and the Rating Agencies. If the Sponsor fails to mail such notice within ten (10) days after acceptance of appointment by the successor Owner Trustee, the
successor Owner Trustee shall cause such notice to be mailed at the expense of the Sponsor. 
  
 Any successor Owner Trustee appointed pursuant to this Section 11.03 shall file an amendment to the Certificate of Trust with the Secretary of State identifying the name and principal place of business of such
successor Owner Trustee in the State of Delaware. 
  
 Section
11.04. Merger or Consolidation of Owner Trustee. Any corporation or banking association into which the Owner Trustee may be merged or converted or with which it may be consolidated or any corporation or banking association resulting from any
merger, conversion or consolidation to which the Owner Trustee shall be a party, or any corporation or banking association succeeding to all or substantially all of the corporate trust business of the 
  

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 Owner Trustee, shall be the successor of the Owner Trustee hereunder, provided such corporation or banking association
shall be eligible pursuant to Section 11.01, without the execution or filing of any instrument or any further act on the part of any of the parties hereto, except the filing of an amendment to the Certificate of Trust, if appropriate, anything
herein to the contrary notwithstanding; provided, further, that the Owner Trustee shall mail notice of such merger, conversion or consolidation to the Rating Agencies and; provided, further, that the Owner Trustee shall
file an amendment to the Certificate of Trust as required under Section 11.03 above. 
  
 Section 11.05. Appointment of Co-Trustee or Separate Trustee. 
  
 (a) Notwithstanding any other provisions of this Agreement, at any time, for the purpose of meeting any legal requirements of any jurisdiction in which
any part of the Owner Trust Estate or any Mortgaged Property may at the time be located, and for the purpose of performing certain duties and obligations of the Owner Trustee with respect to the Trust and the Certificates, the Owner Trustee shall
have the power and shall execute and deliver all instruments to appoint one or more Persons approved by the Owner Trustee and acceptable to the Note Insurer to act as co-trustee, jointly with the Owner Trustee, or separate trustee or separate
trustees, of all or any part of the Owner Trust Estate, and to vest in such Person, in such capacity, such title to the Trust, or any part thereof, and, subject to the other provisions of this Section 11.05, such powers, duties, obligations, rights
and trusts as the Note Insurer and the Owner Trustee may consider necessary or desirable. No co-trustee or separate trustee under this Agreement shall be required to meet the terms of eligibility as a successor trustee pursuant to Section 11.01 and
no notice of the appointment of any co-trustee or separate trustee shall be required pursuant to Section 11.03. 
  
 (b) Each separate trustee and co-trustee shall, to the extent permitted by law, be appointed and act subject to the following provision and conditions:

  
 (i) all rights, powers, duties and
obligations conferred or imposed upon the Owner Trustee shall be conferred upon and exercised or performed by the Owner Trustee and such separate trustee or co-trustee jointly (it being understood that such separate trustee or co-trustee is not
authorized to act separately without the Owner Trustee joining in such act), except to the extent that under any law of any jurisdiction in which any particular act or acts are to be performed, the Owner 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 or any portion thereof in any such jurisdiction) shall be exercised and performed singly by such separate trustee
or co-trustee, but solely at the direction of the Owner Trustee; 
  
 (ii) no trustee under this Agreement shall be personally liable by reason of any act or omission of any other trustee under this Agreement; and 
  
 (iii) the Owner Trustee may at any time accept the resignation of or remove any separate trustee or
co-trustee. 
  
 (c) Any notice, request or other writing given to
the Owner Trustee shall be deemed to have been given to the separate trustees and co-trustees, as if given to each of them. Every 
  

 38 

 instrument appointing any separate trustee or co-trustee, other than this Agreement, shall refer to this Agreement and to
the conditions of this Article XI. Each separate trustee and co-trustee, upon its acceptance of appointment, shall be vested with the estates specified in its instrument of appointment, either jointly with the Owner 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 Owner Trustee. Each such instrument
shall be filed with the Owner Trustee. 
  
 (d) Any separate
trustee or co-trustee may at any time appoint the Owner Trustee as 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 Owner Trustee, to the extent permitted by law,
without the appointment of a new or successor trustee. 
  
 ARTICLE XII 
  
 MISCELLANEOUS 
  
 Section 12.01. Supplements and Amendments. This Agreement may be
amended by the Sponsor, the Seller and the Owner Trustee, with the prior written consent of the Note Insurer, and with prior written notice to the Rating Agencies, but without the consent of any of the Noteholders, the Certificateholders or the
Indenture Trustee, to cure any ambiguity, to correct or supplement any provisions in this Agreement or for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions in this Agreement or of modifying in
any manner the rights of the Noteholders or the Certificateholders; provided, however, such action shall not adversely affect in any material respect the interests of any Noteholder or Certificateholder. An amendment described above
shall be deemed not to adversely affect in any material respect the interests of any Noteholder if the party requesting the amendment satisfies the Rating Agency Condition with respect to such amendment. 
  
 This Agreement may also be amended from time to time by the Sponsor, the
Seller and the Owner Trustee, with the prior written consent of the Rating Agencies and with the prior written consent of the Indenture Trustee, the Note Insurer, the Noteholders evidencing more than 50% of the Note Principal Balance of the
Outstanding Notes of all of the Classes and the Certificateholders evidencing more than 50% of the Percentage Interests of the Trust, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this
Agreement or of modifying in any manner the rights of the Noteholders or the Certificateholders; provided, however, no such amendment shall (a) increase or reduce in any manner the amount of, or accelerate or delay the timing of,
collections of payments on the Mortgage Loans or distributions that shall be required to be made for the benefit of the Noteholders, the Certificateholders or the Note Insurer, (b) reduce the aforesaid percentage of the Outstanding Principal Balance
of the Notes or the Percentage Interests required to consent to any such amendment, in either case of clause (a) or (b) without the consent of the holders of all the outstanding Notes, the Note Insurer and the Certificateholders of all the
outstanding Certificates. 
  

 39 

 Promptly after the execution of any such amendment or consent, the Sponsor shall furnish written
notification of the substance of such amendment or consent to the Certificateholders, the Indenture Trustee, the Note Insurer and each of the Rating Agencies. 
  

It shall not be necessary for the consent of the Certificateholders, the Noteholders or the Indenture Trustee pursuant to this Section to approve the
particular form of any proposed amendment or consent, but it shall be sufficient if such consent shall approve the substance thereof. The manner of obtaining such consents (and any other consents of Certificateholders provided for in this Agreement
or in any other Basic Document) and of evidencing the authorization of the execution thereof by Certificateholders shall be subject to such reasonable requirements as the Owner Trustee may prescribe. 
  
 Promptly after the execution of any amendment to the Certificate of Trust,
the Owner Trustee shall cause the filing of such amendment with the Secretary of State. 
  
 Prior to the execution of any amendment to this Agreement or the Certificate of Trust, the Owner Trustee shall be entitled to receive and rely upon an Opinion of Counsel stating that the execution of such amendment is
authorized or permitted by this Agreement and that all conditions precedent have been met. The Owner Trustee may, but shall not be obligated to, enter into any such amendment which affects the Owner Trustee’s own rights, duties or immunities
under this Agreement or otherwise. 
  
 Section 12.02. No Legal
Title to Owner Trust Estate in Certificateholders. The Certificateholders shall not have legal title to any part of the Owner Trust Estate. The Certificateholders shall be entitled to receive distributions with respect to their undivided
beneficial ownership interest therein only in accordance with Articles VI and X. No transfer, by operation of law or otherwise, of any right, title, or interest of the Certificateholders to and in their ownership interest in the Owner Trust Estate
shall operate to terminate this Agreement or the trusts hereunder or entitle any transferee to an accounting or to the transfer to it of legal title to any part of the Owner Trust Estate. 
  
 Section 12.03. Limitations on Rights of Others. The provisions of this Agreement are solely for the benefit of the
Owner Trustee, the Sponsor, the Seller, the Certificateholders, the Note Insurer and, to the extent expressly provided herein, the Indenture Trustee and the Noteholders, and nothing in this Agreement, whether express or implied, shall be construed
to give to any other Person any legal or equitable right, remedy or claim in the Owner Trust Estate or under or in respect of this Agreement or any covenants, conditions or provisions contained herein. 
  
 Section 12.04. Notices. (a) Unless otherwise expressly specified or
permitted by the terms hereof, all communications provided for or permitted hereunder shall be in writing and shall be deemed to have been given if (1) personally delivered, (2) upon receipt by the intended recipient or three Business Days after
mailing if mailed by certified mail, postage prepaid (except that notice to the Owner Trustee shall be deemed given only upon actual receipt by the Owner Trustee), (3) sent by express courier delivery service and received by the intended recipient
or (4) except with respect to notices sent to the Owner Trustee, transmitted by telex or facsimile transmission (or any other type of electronic transmission agreed upon by the parties and confirmed by a writing delivered by any of the means
described in (1), (2) or (3), at the following 
  

 40 

 addresses: (i) if to the Owner Trustee, at its Corporate Trust Office; (ii) if to the Sponsor, Accredited Home Lenders,
Inc., 15090 Avenue of Science, San Diego, California 92128, Attention: General Counsel, telecopy: (858) 676-2170; and (iii) if to the Note Insurer, Ambac Assurance Corporation, One State Street Plaza, New York, New York, 10004, Attention: Accredited
Mortgage Loan Trust 2004-1, telecopy: (858) 676-2170; or, as to each such party, at such other address as shall be designated by such party in a written notice to each other party. 
  
 (b) Any notice required or permitted to be given to a Certificateholder shall be given by first-class mail, postage prepaid,
at the address of such Certificateholder 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 12.05. Severability. Any provision
of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. 
  
 Section 12.06. Separate Counterparts. This Agreement may be executed by the parties hereto in separate counterparts, each of which when so executed
and delivered shall be an original, but all such counterparts shall together constitute but one and the same instrument. 
  
 Section 12.07. Successors and Assigns. All covenants and agreements contained herein shall be binding upon, and inure to the benefit of, the
Sponsor, the Note Insurer, the Owner Trustee and its successors and each Certificateholder and its successors and permitted assigns, all as herein provided. Any request, notice, direction, consent, waiver or other instrument or action by a
Certificateholder shall bind the successors and assigns of such Certificateholder. 
  
 Section 12.08. No Petition. The Owner Trustee, by entering into this Agreement, each Certificateholder, by accepting a Certificate, and the Indenture Trustee and each Noteholder by accepting the benefits of
this Agreement, hereby covenant and agree that they will not at any time institute against the Seller or the Trust, or join in any institution against the Seller or the Trust of, any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings, or other proceedings under any United States Federal or state bankruptcy law in connection with any obligations relating to the Certificates, the Notes, this Agreement or any of the other Basic Documents. 
  
 This Section 12.08 will survive for one year and one day following the
termination of this Agreement. 
  
 Section 12.09. No
Recourse. Each Certificateholder by accepting a Certificate acknowledges that such Certificateholder’s Certificate represents a beneficial interest in the Trust only and does not represent an interest in or an obligation of the Master
Servicer, the Backup Servicer, the Sponsor, the Owner Trustee or any Affiliate thereof and no recourse may be had against such parties or their assets, except as may be expressly set forth or contemplated in this Agreement, the Certificates or the
other Basic Documents. 
  

 41 

 Section 12.10. Headings. The headings of the various Articles and Sections herein are for
convenience of reference only and shall not define or limit any of the terms or provisions hereof. 
  
 Section 12.11. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. 
  
 Section 12.12. Grant of Certificateholder Rights to Note Insurer. (a) In consideration for the issuance of the Certificates and for the guarantee
of the Notes by the Note Insurer pursuant to the Note Insurance Policy, the Certificateholders hereby grant to the Note Insurer the right to act as the holder of 100% of the outstanding Certificates for the purpose of exercising the rights hereunder
of the Certificateholders under this Agreement without the consent of the Certificateholders, including the voting rights of such Certificateholders hereunder, but excluding those rights requiring the consent of all such Certificateholders, and any
rights of such Certificateholders to distributions under the Indenture and the other Basic Documents; provided, that the preceding grant of rights to the Note Insurer by the Certificateholders shall be subject to Section 12.14. 
  
 (b) [Reserved]. 
  
 (c) The duties and responsibilities of the Owner Trustee shall be limited to those expressly provided for in this Agreement.
The parties hereto agree that except for purposes of the foregoing sentence, the Owner Trustee shall have no management responsibilities or owe any fiduciary duties to the Note Insurer (or the Noteholders in the event they succeed to the Note
Insurer’s rights). 
  
 (d) Whenever in connection with its
performance under this Agreement the Owner Trustee receives inconsistent notices or advice from the Note Insurer and the Certificateholders, the Owner Trustee shall, in the absence of a Note Insurer Default, take the action required by the notices
or advice received from the Note Insurer. 
  
 Section 12.13.
Third-Party Beneficiaries. The Indenture Trustee and the Note Insurer are intended third-party beneficiaries of this Agreement, and this Agreement shall be binding upon and inure to the benefit of the Indenture Trustee and the Note Insurer;
provided, that, notwithstanding the foregoing, for so long as a Note Insurer Default is continuing with respect to its obligations under the Note Insurance Policy, the Certificateholders shall succeed to the Note Insurer’s rights
hereunder. Without limiting the generality of the foregoing, all covenants and agreements in this Agreement that expressly confer rights upon the Note Insurer shall be for the benefit of and run directly to the Note Insurer, and the Note Insurer
shall be entitled to rely on and enforce such covenants to the same extent as if it were a party to this Agreement. 
  
 Section 12.14. Suspension and Termination of Note Insurer’s Rights. During the continuation of a Note Insurer Default, rights granted or
reserved to the Note Insurer hereunder shall vest instead in the Certificateholders; provided, that the Note Insurer shall be entitled to any 
  

 42 

 distributions of reimbursements to the Note insurer as set forth in the Indenture and the Insurance Agreement and the
Note Insurer shall retain those rights under Section 12.01 to consent to any amendment of this Agreement. 
  
 At such time as either (i) the outstanding Note Principal Balance of the Notes has been reduced to zero or (ii) the Note Insurance Policy has been
terminated and in either case of (i) or (ii) the Note Insurer has been reimbursed for all amounts owed under the Note Insurance Policy and the Insurance Agreement (and the Note Insurer no longer has any obligation under the Note Insurance Policy),
then the rights and benefits granted or reserved to the Note Insurer hereunder (including the rights to direct certain actions and receive certain notices) shall terminate and the Certificateholders shall be entitled to the exercise of such rights
and to receive such benefits of the Note Insurer following such termination to the extent that such rights and benefits are applicable to the Certificateholders. 
  
 Section 12.15. Master Servicer. The Master Servicer is authorized to prepare, or cause to be prepared, execute and
deliver on behalf of the Trust all such documents, reports, filings, instruments, certificates and opinions as it shall be the duty of the Trust, the Sponsor or Owner Trustee to prepare, file or deliver pursuant to the Basic Documents. Upon written
request, the Owner Trustee shall execute and deliver to the Master Servicer a limited power of attorney appointing the Master Servicer the Trust’s agent and attorney-in-fact to prepare, or cause to be prepared, execute and deliver all such
documents, reports, filings, instruments, certificates and opinions. 
  
 [Remainder of Page Intentionally Left Blank] 
  

 43 

 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective
officers hereunto duly authorized, as of the day and year first above written. 
  

					
	 ACCREDITED HOME LENDERS, INC.,
             as Sponsor

		
	 By:
	 	 /s/    John S.
Buchanan        

	 	 	 Name: John S. Buchanan

	 	 	 Title: Chief Financial Officer

	
	 ACCREDITED HOME CAPITAL, INC.,
             as Seller

		
	 By:
	 	 /s/    David E.
Hertzel        

	 	 	 Name: David E. Hertzel

	 	 	 Title: GC, AVP & Ass’t Sec’y

	
	 U.S. BANK TRUST, NATIONAL ASSOCIATION,
 not
in its individual capacity but solely as Owner Trustee under the Trust Agreement

		
	 By:
	 	 /s/    Patricia M.
Child        

	 	 	 Name: Patricia M. Child

	 	 	 Title: Vice President

  

 44 

 EXHIBIT A 
  
 FORM OF TRUST CERTIFICATE 
  
 THE EQUITY INTEREST IN THE TRUST REPRESENTED BY THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“ACT”), OR ANY STATE SECURITIES LAWS. THIS EQUITY INTEREST MAY BE DIRECTLY OR INDIRECTLY OFFERED OR SOLD OR OTHERWISE DISPOSED OF (INCLUDING PLEDGED) BY THE HOLDER HEREOF ONLY TO (I) A “QUALIFIED INSTITUTIONAL BUYER” AS
DEFINED IN RULE 144A UNDER THE ACT, IN A TRANSACTION THAT IS REGISTERED UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS OR THAT IS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND OF SUCH STATE LAWS OR (II) A PERSON INVOLVED IN THE
ORGANIZATION OR OPERATION OF THE TRUST OR AN AFFILIATE OF SUCH A PERSON WITHIN THE MEANING OF RULE 3A-7 OF THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED (INCLUDING, BUT NOT LIMITED TO, ACCREDITED HOME LENDERS, INC.) IN A TRANSACTION THAT IS
REGISTERED UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS OR THAT IS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND SUCH LAWS. NO PERSON IS OBLIGATED TO REGISTER THIS EQUITY INTEREST UNDER THE ACT OR ANY STATE SECURITIES LAWS.

  
 NO TRANSFER OF THIS CERTIFICATE OR ANY BENEFICIAL INTEREST HEREIN SHALL BE
MADE TO ANY PERSON UNLESS THE OWNER TRUSTEE HAS RECEIVED A REPRESENTATION LETTER FROM THE TRANSFEREE TO THE EFFECT THAT SUCH TRANSFEREE IS NOT (I) AN EMPLOYEE BENEFIT PLAN (WITHIN THE MEANING OF SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED (“ERISA”)) THAT IS SUBJECT TO TITLE OF ERISA, (II) A PLAN (WITHIN THE MEANING OF SECTION 4975(E)(1) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”)) THAT IS SUBJECT TO SECTION 4975
OF THE CODE OR (III) A GOVERNMENTAL PLAN (WITHIN THE MEANING OF SECTION 3(32) OF ERISA) THAT IS SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW THAT IS, TO A MATERIAL EXTENT, SIMILAR TO TITLE I OF ERISA OR SECTION 4975 OF THE CODE (EACH OF THE FOREGOING,
A “PLAN”) AND IS NOT DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR A BENEFICIAL INTEREST HEREIN ON BEHALF OR, AS INVESTMENT MANAGER OF, AS TRUSTEE OF, OR WITH THE ASSETS OF A PLAN. 
  
 THIS CERTIFICATE MAY NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF UNLESS, PRIOR TO SUCH
DISPOSITION, THE PROPOSED TRANSFEREE DELIVERS TO THE OWNER TRUSTEE AND THE CERTIFICATE REGISTRAR A CERTIFICATE STATING THAT SUCH TRANSFEREE (A) AGREES TO BE BOUND BY AND TO ABIDE BY THE TRANSFER RESTRICTIONS APPLICABLE TO THIS CERTIFICATE; (B) IS
NOT AN ENTITY THAT WILL HOLD THIS CERTIFICATE AS NOMINEE TO FACILITATE THE CLEARANCE AND SETTLEMENT OF SUCH SECURITY THROUGH ELECTRONIC BOOK-ENTRY CHANGES IN ACCOUNTS OF PARTICIPATING ORGANIZATIONS; AND (C) UNDERSTANDS THAT IT MUST TAKE INTO ACCOUNT
ITS PERCENTAGE INTEREST OF THE TAXABLE INCOME RELATING TO THIS CERTIFICATE. 
  

			
	 Certificate No. 1
	 	Percentage Interest: 100%

  
 THIS CERTIFIES THAT
Accredited Home Capital, Inc. (the “Certificateholder”) is the registered owner of a 100% Percentage Interest in Accredited Mortgage Loan Trust 2004-1 (the “Trust”) existing under the laws of the State of Delaware
and created pursuant to that certain Trust Agreement, dated as of February 11, 2004, as amended and restated on February 19, 2004 (as amended and restated, the “Trust Agreement”), by and among Accredited Home Lenders, Inc., as
sponsor, Accredited Home Capital, Inc., as seller, and U.S. Bank Trust National Association, not its individual capacity but solely as owner trustee under the Trust Agreement (the “Owner Trustee”). Capitalized terms used but not
otherwise defined herein have the meanings assigned to such terms in the Trust Agreement. The Owner Trustee, on behalf of the Trust and not in its individual capacity, has executed this Certificate by one of its duly authorized signatories as set
forth below. This Certificate is one of the Certificates referred to in the Trust Agreement and is issued under and is subject to the terms, provisions and conditions of the Trust Agreement to which the Certificateholder by virtue of the acceptance
hereof agrees and by which the Certificateholder hereof is bound. Reference is hereby made to the Trust Agreement for the rights of the Certificateholder, as well as for the terms and conditions of the Trust created by the Trust Agreement.

  
 The recitals contained herein (other than the signature and
countersignature of the Owner Trustee) shall be taken as the statements of the Sponsor, and the Owner Trustee assumes no responsibility for the correctness thereof. 
  
 The Certificateholder, by its acceptance hereof, agrees not to transfer this Certificate except in accordance with terms and
provisions of the Trust Agreement. 
  
 The Certificateholder, by
its acceptance hereof, acknowledges that such Certificateholder’s Certificate represents a beneficial interest in the Trust only and does not represent an interest in or an obligation of the Master Servicer, the Backup Servicer, the Seller, the
Sponsor, the Owner Trustee or any Affiliate thereof and no recourse may be had against such parties or their assets, except as may be expressly set forth or contemplated herein, in the Trust Agreement or the other Basic Documents. 
  
 THIS CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. 
  

 A-2 

 IN WITNESS WHEREOF, the Owner Trustee, on behalf of the Trust and not in its individual capacity, has
caused this Certificate to be duly executed. 
  

			
	 ACCREDITED MORTGAGE LOAN TRUST 2004-1

	
	 U.S. BANK TRUST NATIONAL ASSOCIATION,
 not in
its individual capacity but solely as Owner Trustee under the Trust Agreement

		
	 By:
	 	  

	 	 	Authorized Signatory

  
 Dated: February 19, 2004

  
 CERTIFICATE OF AUTHENTICATION 
  
 This is one of the Certificates referred to in the within-mentioned Trust
Agreement. 
  

			
	U.S. BANK TRUST NATIONAL ASSOCIATION, not in its individual capacity but solely as Owner Trustee under the Trust Agreement
		
	 By:
	 	  

	 	 	Authorized Signatory

  
 Dated: February 19, 2004

  

 A-3 

 ASSIGNMENT 
  

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfer unto 
  
 PLEASE INSERT SOCIAL SECURITY 
 OR OTHER
IDENTIFYING NUMBER 
 OF ASSIGNEE 
  
                                       
                                        
                                        
                                        
                                        
                    
 (Please print or type name and
address, including postal zip code, of assignee) 
  
                                       
                                        
                                        
                                        
                                        
                    
 the within instrument, and all rights
thereunder, hereby irrevocably constituting and appointing                             , Attorney, to
transfer said Instrument on the books of the Certificate Registrar, with full power of substitution in the premises. 
  
 Dated: 
  

			
	 By:
	 	 */

	 	 	             Signature Guaranteed:

		
	 By:
	 	 */

	*/	NOTICE: The signature to this assignment must correspond with the name as it appears upon the face of the within Instrument in every particular, without alteration, enlargement or
any change whatever. Such signature must be guaranteed by a member firm of the New York Stock Exchange or a commercial bank or trust company. 

  
  

 A-4 

 EXHIBIT B 
  
 FORM OF CERTIFICATE OF TRUST 
  
 CERTIFICATE OF TRUST OF 
 ACCREDITED MORTGAGE
LOAN TRUST 2004-1 
  
 THIS CERTIFICATE OF TRUST OF ACCREDITED
MORTGAGE LOAN TRUST 2004-1 (the “Trust”), dated as of February 11, 2004, as amended and restated on February 19, 2004 (as amended and restated, the “Trust Agreement”), is being duly executed and filed by U.S. Bank
Trust National Association, a national banking association, as owner trustee (the “Owner Trustee”), to form a statutory trust under the Delaware Statutory Trust Act (12 Del. Code, § 3801 et seq.). 
  
 1. Name. The name of the business trust formed hereby
is Accredited Mortgage Loan Trust 2004-1. 
  
 2.
Delaware Trustee. The name and business address of the Owner Trustee of the Trust in the State of Delaware are U.S. Bank Trust National Association, 300 Delaware Avenue, Eighth Floor, Wilmington, Delaware 19801, Attention: Corporate Trust
Administration. 
  
 3. Series. Pursuant to
Section 3806(b)(2) of the Act, the Trust shall issue one or more series of beneficial interests having the rights and preferences set forth in the Governing instrument of the Trust, as the same may be amended from time to time (each, a
“Series” or “Sub-Trust”). 
  
 4. Notice of Limitation of Liabilities of each Series. Pursuant to Section 3804(a) of the Act, there shall be a limitation on liabilities of each Series such that (a) the debts, liabilities, obligations and
expenses incurred, contracted for or otherwise existing with respect to a particular Series shall be enforceable against the assets of such Series only, and not against the assets of the Trust generally or the assets of any other Series thereof and
(b) none of the debts, liabilities, obligations and expenses incurred, contracted for or otherwise existing with respect to the Trust generally or any other Series thereof shall be enforceable against the assets of such Series. 
  
 5. Effective Date. This Certificate of Trust shall be
effective at 12:01 a.m. on February 11, 2004. 
  

 B-1 

 IN WITNESS WHEREOF, the undersigned, being the sole trustee of the Trust, has executed this Certificate
of Trust as of the date first above written. 
  

					
	U.S. BANK TRUST NATIONAL ASSOCIATION, not in its individual capacity but solely as Owner Trustee under the Trust Agreement, dated as of February 11,
2004.
		
	 By:
	 	  

	 	 	 Name:
	 	 
	 	 	 Title:
	 	 

  

 B-2 

 EXHIBIT C 
  
 FORM OF INVESTMENT LETTER 
                                 ,
             
  
 Accredited Home Lenders, Inc. 
 15030 Avenue of Science 
 San Diego, California 92128 
  
 U.S. Bank Trust National Association

 300 Delaware Avenue, Eighth Floor 
 Wilmington, Delaware 19801

 Attention: Corporate Trust Administration 
  

	 	Re:	Accredited Mortgage Loan Trust 2004-1 (the “Trust”)  

   Asset-Backed Notes, Series 2004-1 
  
 Ladies and Gentlemen: 
  
                                       
                                        
   (the “Certificateholder”) has purchased or acquired, or intends to purchase or acquire from
                                , the current Certificateholder (the
“Current Certificateholder”), a Trust Certificate representing a 100% Percentage Interest (the “Certificate”) in the Trust, which represents an interest in the Trust created pursuant to that certain Trust Agreement,
dated as of February 11, 2004, as amended and restated on February 19, 2004 (the “Trust Agreement”), by and among Accredited Home Lenders, Inc., as Sponsor, Accredited Home Capital, Inc., as Seller and U.S. Bank Trust National
Association, as Owner Trustee. Capitalized terms used and not otherwise defined herein have the meanings assigned to such terms in the Trust Agreement. 
  
 CERTIFICATION 
  
 The undersigned, as an authorized officer or agent of the Certificateholder, hereby certifies, represents, warrants and agrees on behalf of the
Certificateholder as follows: 
  
 1. The Certificateholder is
duly organized, validly existing and in good standing under the laws of the jurisdiction in which it was formed and is authorized to invest in the Certificate. The person executing this letter on behalf of the Certificateholder is duly authorized to
do so on behalf of the Certificateholder. 
  
 2. The
Certificateholder hereby acknowledges that no transfer of the Certificate may be made unless such transfer is exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”); and applicable
state securities laws, or is made in accordance with the Securities Act and such laws. 
  
 3. The Certificateholder understands that the Certificate has not been and will not be registered under the Securities Act and may be offered, sold, pledged or otherwise transferred to a person whom the transferor
reasonably believes is (A) a qualified institutional 
  

 C-1 

 buyer (as defined in Rule 144A under the Securities Act) or (B) a Person involved in the organization or operation of the
Trust or an affiliate of such Person, in a transaction pursuant to an effective registration statement under the Securities Act and any applicable state securities laws or exempt from the registration requirements of the Securities Act and any such
state securities laws. The Certifcateholder understands that the Certificate bears a legend to the foregoing effect. 
  
 4. The Certificateholder is acquiring the Certificate for its own account or for accounts for which it exercises sole investment discretion, and not with
a view to or for sale or other transfer in connection with any distribution of the Certificate in any manner that would violate Section 5 of the Securities Act or any applicable state securities laws, subject nevertheless to any requirement of law
that the disposition of the Certificateholder’s property shall at all times be and remain within its control. 
  
 5. The Certificateholder is (A) a “qualified institutional buyer” (a “QIB”) as defined in Rule 144A under the Securities Act,
and is aware that the transferor of the Certificate may be relying on an exemption from the registration requirements of the Securities Act and is acquiring such Certificate for its own account or for the account of one or more qualified
institutional buyers for whom it is authorized to act, or (B) a Person involved in the organization or operation of the Trust or an affiliate of such Person within the meaning of Rule 3a-7 of the Investment Company Act of 1940, as amended
(including, but not limited to, the Sponsor). The Certificateholder is able to bear the economic risks of such an investment. The Certificateholder is a QIB because [STATE FACTUAL BASIS FOR QIB STATUS]. 
  
 6. If the Certificateholder sells or otherwise transfers the registered
ownership of such Certificate, the Certificateholder will comply with the restrictions and requirements with respect to the transfer of the ownership of the Certificate under the Trust Agreement, and the Certificateholder will obtain from any
subsequent purchaser or transferee substantially the same certifications, representations, warranties and covenants as required under the Trust Agreement in connection with such subsequent sale or transfer thereof. 
  
 7. The Certificateholder is not an entity that will hold a Certificate as
nominee (a “Book Entry Nominee”) to facilitate the clearance and settlement of such security through electronic book-entry changes in Accounts or participating organizations. 
  
 8. The Certificateholder is not a Plan and is not, directly or indirectly,
purchasing such Certificate on behalf of, as investment manager of, as named fiduciary of, as trustee of, or with assets of a Plan. 
  
 9. The Certificateholder hereby agrees to indemnify each of the Trust, the Indenture Trustee, the Note Insurer, and the Owner Trustee against any
liability that may result if the Certificateholder’s transfer of a Certificate (or any portion thereof) is not exempt from the registration requirements of the Securities Act and any applicable state securities laws or is not made in accordance
with such federal and state laws. Such indemnification of the Trust, the Indenture Trustee, and the Owner Trustee shall survive the termination of the related Trust Agreement. 
  

 C-2 

 IN WITNESS WHEREOF, the Certificateholder has caused this instrument to be executed on its behalf
pursuant to the authority of its Board of Directors, by its duly authorized signatory this                      day of
            , 2004. 
  

					
	 [NAME OF CERTIFICATEHOLDER]

		
	 By:
	 	  

	 	 	 Name:
	 	 
	 	 	 Title:
	 	 

  

 C-3 

 EXHIBIT D 
  
 FORM OF TRANSFEROR CERTIFICATE 
  
                                 ,
             
  
 Accredited Home Lenders, Inc. 
 15030 Avenue of Science 
 San Diego, California 92128 
  
 U.S. Bank Trust National Association

 300 Delaware Avenue, Eighth Floor 
 Wilmington, Delaware 19801

 Attention: Corporate Trust Administration 
  

	 	Re:	Accredited Mortgage Loan Trust 2004-1 (the “Trust”)  

      Asset-Backed Notes, Series 2004-1 
  
 Ladies and Gentlemen: 
  
 In
connection with our disposition of the above-referenced Asset-Backed Certificates (the “Certificates”) we certify that (i) we understand that the Certificates have not been registered under the Securities Act of 1933, as amended
(the “Act”), and are being transferred by us in a transaction that is exempt from the registration requirements of the Act and (ii) we have not offered or sold any Certificates to, or solicited offers to buy any Certificates from,
any person, or otherwise approached or negotiated with any person with respect thereto, in a manner that would be deemed, or taken any other action which would result in, a violation of Section 5 of the Act. 
  
 Dated: 
  

			
	 [NAME OF TRANSFEROR]

		
	 By:
	 	  

	 	 	         Authorized Officer

  

 D-1SALE AND SERVICING AGREEMENT

 Exhibit 10.1 
  
 EXECUTION COPY 
  
 SALE AND SERVICING AGREEMENT 
  
 dated as of February 1, 2004 
  
 by and among 
  
 ACCREDITED HOME CAPITAL, INC., 
 as Seller, 
  
 ACCREDITED HOME LENDERS, INC., 
 as Sponsor and Master Servicer, 
  
 ACCREDITED MORTGAGE LOAN TRUST 2004-1, 
 as
Issuer, 
  
 COUNTRYWIDE HOME LOANS SERVICING LP, 
 as Backup Servicer, 
  
 and 
  
 DEUTSCHE BANK NATIONAL TRUST COMPANY, 
 as Indenture Trustee 

 TABLE OF CONTENTS 
  

					
	 	  	 	  	Page

	ARTICLE I	  	 
	DEFINITIONS	  	 
			
	 Section 1.01
	  	Certain Defined Terms	  	1
	 Section 1.02
	  	Provisions of General Application	  	2
		
	ARTICLE II	  	 
	SALE AND CONVEYANCE OF THE MORTGAGE LOANS	  	 
			
	 Section 2.01.
	  	Purchase and Sale of Mortgage Loans; Deposit of Derivatives	  	2
	 Section 2.02.
	  	Reserved	  	3
	 Section 2.03.
	  	Purchase Price	  	3
	 Section 2.04.
	  	Possession of Mortgage Files; Access to Mortgage Files	  	3
	 Section 2.05.
	  	Delivery of Mortgage Loan Documents	  	3
	 Section 2.06.
	  	Acceptance of the Trust Estate; Certain Substitutions; Certification by the Indenture Trustee	  	6
	 Section 2.07.
	  	Grant of Security Interest	  	8
	 Section 2.08.
	  	Further Action Evidencing Assignments	  	9
	 Section 2.09.
	  	Assignment of Agreement	  	9
		
	ARTICLE III	  	 
	REPRESENTATIONS, WARRANTIES AND COVENANTS	  	 
			
	 Section 3.01.
	  	Representations, Warranties and Covenants of the Master Servicer	  	10
	 Section 3.02.
	  	Representations, Warranties and Covenants of the Sponsor	  	11
	 Section 3.03.
	  	Representations, Warranties and Covenants of the Backup Servicer	  	13
	 Section 3.04.
	  	Representations, Warranties and Covenants of the Indenture Trustee	  	14
	 Section 3.05.
	  	Covenants and Representations of the Sponsor and Master Servicer Regarding Prepayment Charges	  	15
	 Section 3.06.
	  	Representations, Warranties and Covenants of the Seller	  	15
		
	ARTICLE IV	  	 
	THE MORTGAGE LOANS	  	 
			
	 Section 4.01.
	  	Representations and Warranties Concerning the Mortgage Loans	  	17
	 Section 4.02.
	  	Purchase and Substitution	  	25
		
	ARTICLE V	  	 
	ADMINISTRATION AND SERVICING OF THE MORTGAGE LOANS	  	 
			
	 Section 5.01.
	  	The Master Servicer	  	26
	 Section 5.02.
	  	Collection of Certain Mortgage Loan Payments; Collection Account	  	29
	 Section 5.03.
	  	Permitted Withdrawals from the Collection Account	  	30
	 Section 5.04.
	  	Hazard Insurance Policies; Property Protection Expenses	  	31

  

 i 

					
	 Section 5.05.
	  	Assumption and Modification Agreements	  	32
	 Section 5.06.
	  	Realization Upon Defaulted Mortgage Loans	  	33
	 Section 5.07.
	  	Indenture Trustee to Cooperate	  	34
	 Section 5.08.
	  	Servicing Compensation; Payment of Certain Expenses by Master Servicer	  	35
	 Section 5.09.
	  	Annual Statement as to Compliance	  	36
	 Section 5.10.
	  	Annual Independent Public Accountants’ Servicing Report	  	36
	 Section 5.11.
	  	Access to Certain Documentation	  	36
	 Section 5.12.
	  	Maintenance of Fidelity Bond	  	37
	 Section 5.13.
	  	Subservicing Agreements Between the Master Servicer and Subservicer and Subservicers	  	37
	 Section 5.14.
	  	Reports to the Indenture Trustee; Collection Account Statements	  	38
	 Section 5.15.
	  	Optional Purchase of Defaulted Mortgage Loans	  	38
	 Section 5.16.
	  	Reports to be Provided by the Master Servicer and the Backup Servicer	  	39
	 Section 5.17.
	  	[Reserved]	  	40
	 Section 5.18.
	  	Delinquency Advances	  	40
	 Section 5.19.
	  	Indemnification; Third Party Claims	  	41
	 Section 5.20.
	  	Maintenance of Corporate Existence and Licenses; Merger or Consolidation of the Master Servicer and Backup Servicer	  	41
	 Section 5.21.
	  	Assignment of Agreement by Master Servicer and Backup Servicer; Master Servicer and Backup Servicer Not to Resign	  	42
	 Section 5.22.
	  	Periodic Filings with the Securities and Exchange Commission Additional Information	  	42
	 Section 5.23.
	  	Administrative Duties	  	43
		
	ARTICLE VI	  	 
	APPLICATION OF FUNDS	  	 
			
	 Section 6.01.
	  	Deposits to the Payment Account	  	44
	 Section 6.02.
	  	Collection of Money	  	44
	 Section 6.03.
	  	Application of Principal and Interest	  	45
	 Section 6.04.
	  	[Reserved]	  	45
	 Section 6.05.
	  	Compensating Interest	  	45
	 Section 6.06.
	  	Effect of Payments by the Note Insurer; Subrogation	  	45
		
	ARTICLE VII	  	 
	SERVICER DEFAULT	  	 
			
	 Section 7.01.
	  	Servicer Events of Default	  	45
	 Section 7.02.
	  	Backup Servicer to Act: Appointment of Successor	  	49
	 Section 7.03.
	  	Waiver of Defaults	  	52
	 Section 7.04.
	  	Rights of the Note Insurer to Exercise Rights of the Noteholders	  	52
	 Section 7.05.
	  	Indenture Trustee To Act Solely with Consent of the Note Insurer	  	53
	 Section 7.06.
	  	Mortgage Loans, Trust Estate and Accounts Held for Benefit of the Note Insurer	  	53
	 Section 7.07.
	  	Note Insurer Default	  	54

  

 ii 

					
	ARTICLE VIII	  	 
	TERMINATION	  	 
	 Section 8.01.
	  	Termination	  	54
	 Section 8.02.
	  	Additional Termination Requirements	  	55
	 Section 8.03.
	  	Accounting Upon Termination of Master Servicer	  	55
	 Section 8.04.
	  	Termination of Backup Servicer as Successor Master Servicer	  	56
		
	ARTICLE IX	  	 
	[RESERVED]	  	 
		
	ARTICLE X	  	 
	MISCELLANEOUS PROVISIONS	  	 
			
	 Section 10.01.
	  	Limitation on Liability	  	56
	 Section 10.02.
	  	Acts of Noteholders	  	57
	 Section 10.03.
	  	Amendment	  	57
	 Section 10.04.
	  	Recordation of Agreement	  	58
	 Section 10.05.
	  	Duration of Agreement	  	58
	 Section 10.06.
	  	Notices	  	58
	 Section 10.07.
	  	Severability of Provisions	  	59
	 Section 10.08.
	  	No Partnership	  	59
	 Section 10.09.
	  	Counterparts	  	59
	 Section 10.10.
	  	Successors and Assigns	  	59
	 Section 10.11.
	  	Headings	  	59
	 Section 10.12.
	  	No Petition	  	59
	 Section 10.13.
	  	Third Party Beneficiary	  	60
	 Section 10.14.
	  	Intent of the Parties	  	60
	 Section 10.15.
	  	GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL	  	60
			
	 Schedule I
	  	Mortgage Loan Schedule	  	 
	 Appendix I
	  	Defined Terms	  	 
		
	EXHIBITS	  	 
			
	 Exhibit A
	  	Contents of the Mortgage File	  	 
	 Exhibit B
	  	Indenture Trustee’s Acknowledgement of Receipt	  	 
	 Exhibit C
	  	Indenture Trustee’s Acknowledgement of Receipt	  	 
	 Exhibit D
	  	Initial Certification of Indenture Trustee	  	 
	 Exhibit E
	  	Final Certification of Indenture Trustee	  	 
	 Exhibit F
	  	Request for Release of Documents	  	 
	 Exhibit G
	  	AHL Officer’s Certificate	  	 

  
  

 iii 

 SALE AND SERVICING AGREEMENT, dated as of February 1, 2004 (this “Agreement”), by and
among ACCREDITED HOME CAPITAL, INC., a Delaware corporation, as seller (the “Seller”), ACCREDITED HOME LENDERS, INC., a California corporation, as sponsor (the “Sponsor”), ACCREDITED MORTGAGE LOAN TRUST 2004-1, a
Delaware statutory trust, as issuer (the “Trust”), ACCREDITED HOME LENDERS, INC., a California corporation, as master servicer (the “Master Servicer”), COUNTRYWIDE HOME LOANS SERVICING LP, a Texas limited
partnership, as backup servicer (the “Backup Servicer”), and DEUTSCHE BANK NATIONAL TRUST COMPANY, a national banking association, as indenture trustee (the “Indenture Trustee”). 
  
 W I T N E S S E T H 
  
 WHEREAS, the Sponsor has sold the mortgage loans (the “Mortgage
Loans”) listed on Schedule I to this Agreement and together with the Mortgage Loans, the “Mortgage Loans”) to the Seller, pursuant to the Master Sale and Purchase Agreement, dated as of December 29, 2001, between the
Sponsor and the Seller; 
  
 WHEREAS, the Seller desires to sell to
the Trust, and the Trust desires to purchase from the Seller, the Mortgage Loans; 
  
 WHEREAS, immediately after such purchase, the Trust will pledge such Mortgage Loans to the Indenture Trustee pursuant to the terms of an Indenture, dated as of February 1, 2004 (the “Indenture”),
between the Trust and the Indenture Trustee, and issue the Accredited Mortgage Loan Trust 2004-1, Asset-Backed Notes (the “Notes”); 
  
 WHEREAS, the Master Servicer has agreed to service the Mortgage Loans, which constitute the principal assets of the Trust; 
  
 WHEREAS, the Backup Servicer has agreed to act as backup servicer of the
Mortgage Loans, which constitute the principal assets of the Trust; 
  
 WHEREAS, the Indenture Trustee will hold the Mortgage Loans and certain other assets pledged to the Indenture Trustee pursuant to the Indenture; and 
  
 NOW, THEREFORE, in consideration of the premises and the mutual agreements herein contained, the Seller, the Sponsor, the Trust, the Master Servicer, the
Backup Servicer and the Indenture Trustee hereby agree as follows: 
  
 ARTICLE I 
  
 DEFINITIONS 
  
 Section 1.01. Certain Defined Terms. Capitalized terms used herein but
not defined herein shall have the meanings ascribed to such terms in Appendix I attached hereto. 
  

 1 

 Section 1.02. Provisions of General Application. 
  
 (a) The terms defined herein and in Appendix I to the Indenture include the
plural as well as the singular. 
  
 (b) The words
“herein,” “hereof” and “hereunder” and other words of similar import refer to this Agreement as a whole. Unless otherwise noted, all references to Articles and Sections shall be deemed to refer to Articles and Sections
of this Agreement. 
  
 (c) Any reference to statutes are to be
construed as including all statutory provisions consolidating, amending or replacing the statute to which reference is made and all regulations promulgated pursuant to such statutes. 
  
 (d) All calculations of interest with respect to the Notes provided for herein shall be on the basis of a 360-day year and
the actual number of days elapsed in the related Accrual Period. All calculations of interest with respect to any Mortgage Loan provided for herein shall be made in accordance with the terms of the related Mortgage Note and Mortgage or, if such
documents do not specify the basis upon which interest accrues thereon, on the basis of a 360 day year consisting of twelve 30-day months, to the extent permitted by applicable law. 
  
 (e) Any Mortgage Loan payment is deemed to be received on the date such payment is actually received by the Master Servicer;
provided, however, that, for purposes of calculating payments on the Notes, prepayments with respect to any Mortgage Loan are deemed to be received on the date they are applied in accordance with Accepted Servicing Practices consistent
with the terms of the related Mortgage Note and Mortgage to reduce the outstanding Principal Balance of such Mortgage Loan on which interest accrues. 
  
 ARTICLE II 
  
 SALE AND CONVEYANCE OF THE MORTGAGE LOANS 
  
 Section 2.01. Purchase and Sale of Mortgage Loans; Deposit of Derivatives. (a) The Sponsor hereby directs the Seller to sell, transfer, assign, set
over and convey, and the Seller does hereby sell, transfer, assign, set over and convey to the Trust, to be included as part of Sub-Trust 1 or Sub-Trust 2, as specified in the Mortgage Loan Schedule, in each case without recourse, but subject to the
terms and provisions of this Agreement, all of the right, title and interest of the Seller in and to the Mortgage Loans, including the Cut-Off Date Principal Balance of, and interest due on, such Mortgage Loans listed on Schedule I attached hereto,
and all other assets included or to be included in the Trust Estate. In addition, on or prior to the Closing Date, the Sponsor shall cause the Note Insurer to deliver the Note Insurance Policy. 
  
 (a) The Seller may cause the deposit of derivatives at any time into the
Accredited Mortgage Loan Trust 2004-1 and any such deposited derivatives shall become part of the Trust Estate. 
  

 2 

 Section 2.02. Reserved. 
  
 Section 2.03. Purchase Price. On the Closing Date, as full consideration for the Seller’s sale of the Mortgage
Loans to the Trust, the Underwriter, on behalf of the Trust, will deliver to, or at the direction of, the Seller an amount in cash equal to $503,737,500. Additionally, the Seller will receive the Certificates issued by the Trust pursuant to the
Trust Agreement. 
  
 Section 2.04. Possession of Mortgage
Files; Access to Mortgage Files. 
  
 (a) Upon the receipt by
the Seller, or its designee, of the purchase price for the Mortgage Loans set forth in Section 2.03 hereof, the ownership of each Mortgage Note, each Mortgage and the contents of the Mortgage File related to each Mortgage Loan will be vested in the
Trust, and will be pledged to the Indenture Trustee, for the benefit of the Noteholders and the Note Insurer. 
  
 (b) Pursuant to Section 2.05 hereof, the Seller has delivered, or caused to be delivered the Indenture Trustee’s Mortgage File related to each
Mortgage Loan to the Indenture Trustee. 
  
 (c) The Indenture
Trustee will hold the Indenture Trustee’s Mortgage Files in trust pursuant to the terms of the Indenture for the benefit of all present and future Noteholders and the Note Insurer. 
  
 (d) Consistent with the terms of the Indenture, the Indenture Trustee shall afford the Seller, the Sponsor, the Trust, the
Note Insurer, the Master Servicer and the Backup Servicer reasonable access to all records and documentation regarding the Mortgage Loans relating to this Agreement, such access being afforded at customary charges, upon reasonable prior written
request and during normal business hours at the offices of the Indenture Trustee. 
  
 Section 2.05. Delivery of Mortgage Loan Documents. (a) In connection with the transfer and assignment of the Mortgage Loans, the Seller shall, on or before the Closing Date, deliver, or cause to be delivered,
to the Indenture Trustee (as pledgee of the Trust pursuant to the Indenture), the following documents or instruments constituting the Indenture Trustee’s Mortgage File with respect to each Mortgage Loan so transferred or assigned: 

 
 (i) the original Mortgage Note, endorsed without recourse
in blank or to “Deutsche Bank National Trust Company, as Indenture Trustee under the Indenture dated as of February 1, 2004, Accredited Mortgage Loan Trust 2004-1” by the Sponsor, including all intervening endorsements showing a complete
chain of endorsement; 
  
 (ii) the related
original Mortgage with evidence of recording indicated thereon or a copy thereof certified by the applicable recording office and if the Mortgage Loan is registered on the MERS System, such Mortgage or an assignment of the mortgage shall reflect
MERS as the mortgagee of record and shall include the MIN for such Mortgage Loan; 
  
 (iii) each intervening mortgage assignment, with evidence of recording indicated thereon or if the original is not available, a copy
thereof certified by the applicable recording office, if any, showing a complete chain of assignment from the originator of the related Mortgage Loan to the Sponsor (or to MERS, if the Mortgage 
  

 3 

 Loan is registered on the MERS System), and noting the presence of a MIN (if the Mortgage Loan is
registered on the MERS System), which assignment may, at the Sponsor’s option, be combined with the assignment referred to in subpart (iv) hereof, in which case it must be in recordable form, but need not have been previously recorded);

  
 (iv) unless the Mortgage Loan is registered
on the MERS System, a mortgage assignment in recordable form (which, if acceptable for recording in the relevant jurisdiction as evidenced by an Opinion of Counsel addressed to the Indenture Trustee, may be included in a blanket assignment or
assignments) of each Mortgage from the Sponsor to the Indenture Trustee; 
  
 (v) originals of all assumption, modification and substitution agreements in those instances where the terms or provisions of a Mortgage or Mortgage Note have been modified or such Mortgage or Mortgage Note has been
assumed (if any); and 
  
 (vi) an original title
insurance policy or title opinion (or (A) a copy of the title insurance policy or title opinion, or (B) the related binder, commitment or preliminary report, or copy thereof in which case the Sponsor hereby certifies that the original Mortgage has
been delivered to the title insurance company that issued such binder, commitment or preliminary report). 
  
 In instances where the original recorded Mortgage or any intervening mortgage assignment or a completed assignment of the Mortgage in recordable form
cannot be delivered by the Sponsor to the Indenture Trustee prior to or concurrently with the execution and delivery of this Agreement due to a delay in connection with recording, the Sponsor may: 
  
 (x) in lieu of delivering such original recorded Mortgage or
intervening mortgage assignment, deliver to the Indenture Trustee, a copy thereof and the Sponsor hereby certifies that the original Mortgage has been delivered to a title insurance company for recordation after receipt of its policy of title
insurance or the related binder, commitment or preliminary report therefor; and 
  
 (y) with respect to clause (iii) above, in lieu of delivering the completed assignment in recordable form, deliver to the Indenture
Trustee, the assignment in recordable form, otherwise complete except for recording information. 
  
 The Indenture Trustee is hereby authorized and directed, upon an Event of Default and subject to subsection (b) below, with respect to each assignment described in Section 2.05(a)(iv) hereof, to endorse such
assignment as follows: “Deutsche Bank National Trust Company, as Indenture Trustee under the Indenture dated as of February 1, 2004, Accredited Mortgage Loan Trust 2004-1.” 
  
 (b) As promptly as practicable, but in any event within thirty (30) days from the Closing Date, the Sponsor shall promptly
submit, or cause to be submitted for recording in the appropriate public office for real property records, each assignment referred to in Section 2.05(a)(iv); provided, however, that the Sponsor need not submit any Mortgage Loan that is registered
on the MERS System, if MERS is identified on the Mortgage, or on a properly 
  

 4 

 recorded assignment of Mortgage as the mortgagee of record, and provided, further, however, that the Sponsor need not
cause to be recorded any assignment which relates to a Mortgage Loan in any jurisdiction under the laws of which, as evidenced by an Opinion of Counsel delivered by the Sponsor (at the Sponsor’s expense) to the Indenture Trustee, acceptable to
the Rating Agencies and the Note Insurer, the recordation of such assignment is not necessary to protect the Indenture Trustee’s, the Note Insurer’s, the Noteholders’ and the Certificates’ interest in the related Mortgage Loan.
The Indenture Trustee, shall retain a copy of each assignment submitted for recording. In the event that any such assignment is lost or returned unrecorded because of a defect therein, the Sponsor shall promptly prepare a substitute assignment or
cure such defect, as the case may be, and thereafter the Sponsor shall submit each such assignment for recording. The costs relating to the delivery and recordation of the documents in connection with the Mortgage Loans as specified in this Article
II shall be borne by the Sponsor. 
  
 In connection with the
assignment of any Mortgage Loan registered on the MERS System, promptly after the Closing Date, the Sponsor will cause, at its own expense, the MERS System to indicate that such Mortgage Loan has been assigned to the Trustee for the benefit of the
Noteholders by including (or deleting, in the case of a Mortgage Loan which is repurchased in accordance with this Agreement) in its computer files (a) the applicable Trustee’s Org ID in the field “Investor” which identifies the
Indenture Trustee and (b) the code “Accredited 2004-1” (or its equivalent) in the field “Pool Field” which identifies the securitization serial number of the Notes issued in connection with such Mortgage Loans. The Sponsor and
the Master Servicer will not alter the codes referenced in this paragraph with respect to any such Mortgage Loan during the term of this Agreement unless and until such Mortgage Loan is repurchased or otherwise in accordance with the terms of this
Agreement. 
  
 (c) The Sponsor shall, within five (5) Business
Days after the receipt thereof, deliver, or cause to be delivered, to the Indenture Trustee: (i) the original recorded Mortgage and related power of attorney, if any, in those instances where a copy thereof certified by the Sponsor was delivered to
the Indenture Trustee; (ii) the original recorded assignment of Mortgage from the last endorsee to the Indenture Trustee, which, together with any intervening assignments of Mortgage, evidences a complete chain of assignment from the originator of
the Mortgage Loan to the Indenture Trustee, in those instances where copies of such assignments certified by the Sponsor were delivered to the Indenture Trustee; and (iii) the title insurance policy or title opinion required in Section 2.05(a)(vi).

  
 Notwithstanding anything to the contrary contained in this
Section 2.05, in those instances where the public recording office retains the original Mortgage, power of attorney, if any, assignment or assignment of Mortgage after it has been recorded or such original has been lost, the Sponsor shall be deemed
to have satisfied its obligations hereunder upon delivery to the Indenture Trustee, of a copy of such Mortgage, power of attorney, if any, assignment or assignment of Mortgage certified by the public recording office to be a true copy of the
recorded original thereof. 
  
 From time to time the Sponsor may
forward, or cause to be forwarded, to the Indenture Trustee, additional original documents evidencing any assumption or modification of a Mortgage Loan. 
  

 5 

 (d) All original documents relating to the Mortgage Loans that are not required to be delivered to the
Indenture Trustee, pursuant to Section 2.05(a) hereof are, and shall be, held by the Master Servicer, the Sponsor or the Seller, as the case may be, in trust for the benefit of the Indenture Trustee, on behalf of the Noteholders and the Note
Insurer. In the event that any such original document is required pursuant to the terms of this Section 2.05 to be a part of an Indenture Trustee’s Mortgage File, such document shall be delivered promptly to the Indenture Trustee. From and
after the sale of the Mortgage Loans to the Trust pursuant hereto, to the extent that the last assignee thereof retains title of record to any Mortgage Loans prior to the vesting of legal title in the Trust, such title shall be retained in trust for
the Trust as the owner of the Mortgage Loans, and the Indenture Trustee, as the pledgee of the Trust under the Indenture. In acting as custodian of any original document which is part of the Indenture Trustee’s Mortgage Files, the Master
Servicer agrees further that it does not and will not have or assert any beneficial ownership interest in the related Mortgage Loans or the Mortgage Files. Promptly upon the Master Servicer’s receipt of any such original document, the Master
Servicer, on behalf of the Trust, shall mark conspicuously each such original document, and its master data processing records with a legend evidencing that the Trust has purchased the related Mortgage Loan and all right and title thereto and
interest therein, and pledged such Mortgage Loan and all right and title thereto and interest therein to the Indenture Trustee, on behalf of the Noteholders and the Note Insurer. 
  
 Section 2.06. Acceptance of the Trust Estate; Certain Substitutions; Certification by the Indenture Trustee. (a) The
Indenture Trustee agrees to execute and deliver to the Seller, the Sponsor, the Note Insurer, the Master Servicer and the Backup Servicer on or prior to the Closing Date an acknowledgement of receipt of the Note Insurance Policy in the form attached
as Exhibit B hereto. 
  
 (b) The Indenture Trustee is
authorized and directed to, and agrees to, do the following: 
  
 (i) execute and deliver to the Seller, the Sponsor, the Note Insurer, the Master Servicer and the Backup Servicer, on or prior to the Closing Date with respect to each Mortgage Loan transferred on such date, an
acknowledgement of receipt, in the form attached as Exhibit C hereto, of the original Mortgage Note as required to be included in the Indenture Trustee’s Mortgage File (with any exceptions noted) and declares that it will hold such
documents and any amendments, replacements or supplements thereto, as well as any other assets included in the definition of Trust Estate and delivered to the Indenture Trustee, subject to the conditions set forth in the Indenture, for the benefit
of the Noteholders and the Note Insurer. 
  
 (ii)
to review (or cause to be reviewed) each Indenture Trustee’s Mortgage File within sixty (60) days after the Closing Date (or, with respect to any Qualified Substitute Mortgage Loans, within sixty (60) days after receipt thereof), and to deliver
to the Master Servicer, the Backup Servicer, the Seller, the Sponsor, and the Note Insurer a certification, in the form attached hereto as Exhibit D, to the effect that, except as otherwise noted, as to each Mortgage Loan listed in the
related Mortgage Loan Schedule (other than any Mortgage Loan paid in full or any Mortgage Loan specifically identified in such certification as not covered by such certification), (i) all documents 
  

 6 

 specified in Section 2.05(a)(i)-(iv) and (vi) are in its possession, (ii) each such document has been
reviewed by it and appears, on its face, not to have been mutilated, damaged, torn or otherwise physically altered (handwritten additions, changes or corrections shall not constitute physical alteration if they reasonably appear to have been
initialed), appears regular on its face and relates to such Mortgage Loan, and (iii) based on its examination and only as to the foregoing documents, the information set forth on the Mortgage Loan Schedule as to the information set forth in (i),
(ii) (with respect to property address only, excluding zip code), (iii) and (vi) of the definition of “Mortgage Loan Schedule” accurately reflects the information set forth in the Indenture Trustee’s Mortgage File delivered on such
date; provided however, no certification of the Indenture Trustee shall constitute a determination by the Indenture Trustee of the proper form, adequacy or enforceability of any document included in the Indenture Trustee’s
Mortgage File. 
  
 (iii) to review (or cause to
be reviewed) each Indenture Trustee’s Mortgage File within one hundred eighty (180) days after the Closing Date (or, with respect to any Qualified Substitute Mortgage Loans, within one hundred eighty (180) days after receipt thereof), and to
deliver to the Master Servicer, the Backup Servicer, the Sponsor and the Note Insurer a certification in the form attached hereto as Exhibit E to the effect that, except as otherwise noted, as to each Mortgage Loan listed in the related
Mortgage Loan Schedule (other than any Mortgage Loan paid in full or any Mortgage Loan specifically identified in such certification as not covered by such certification), (i) all documents specified in Section 2.05(a)(i)-(iv) and (vi) are in its
possession, (ii) each such document has been reviewed by it and has not been mutilated, damaged, torn or otherwise physically altered (handwritten additions, changes or corrections shall not constitute physical alteration if they reasonably appear
to be initialed by the Mortgagor), appears regular on its face and relates to such Mortgage Loan, and (iii) based on its examination and only as to the foregoing documents, the information set forth in items (i), (ii) (with respect to property
address only, excluding zip code), (iii) and (vi) of the definition of “Mortgage Loan Schedule” accurately reflects the information set forth in the Indenture Trustee’s Mortgage File delivered on such date. 
  
 In performing any such review, the Indenture Trustee may conclusively rely on
the Sponsor as to the purported genuineness of any such document and any signature thereon. It is understood that the scope of the Indenture Trustee’s review of the Indenture Trustee’s Mortgage Files is limited solely to confirming that
the documents listed in Section 2.05 have been executed and received and relate to the Indenture Trustee’s Mortgage Files identified in the related Mortgage Loan Schedule. The Indenture Trustee shall be under no duty or obligation to inspect,
review or examine any such documents, instruments, certificates or other papers to determine that they are genuine, enforceable, or appropriate for the represented purpose or that they are other than what they purport to be on their face.

  
 (c) If the Indenture Trustee during the process of reviewing
the Indenture Trustee’s Mortgage Files finds any document constituting a part of a Indenture Trustee’s Mortgage File which is not executed, has not been received, is unrelated to the Mortgage Loan identified in the related Mortgage Loan
Schedule, or does not conform to the requirements of Section 2.05 or the description thereof as set forth in the related Mortgage Loan Schedule, the 
  

 7 

 Indenture Trustee shall promptly so notify the Master Servicer, the Backup Servicer, the Sponsor, the Note Insurer and
the Indenture Trustee. Upon receipt of such notice respecting such defect, the Sponsor shall have a sixty (60) day period after such notice within which to correct or cure any such defect, or if the Master Servicer or the Note Insurer determines
that the defect materially and adversely affects the value of the related Mortgage Loan or the interest of the Noteholders and the Note Insurer in the related Mortgage Loan, to either (i) substitute in lieu of such Mortgage Loan a Qualified
Substitute Mortgage Loan in the manner and subject to the conditions set forth in this Section 2.06 or (ii) purchase such Mortgage Loan at a purchase price equal to the Loan Repurchase Price. Upon receipt by the Indenture Trustee of two copies of a
certification, in the form attached hereto as Exhibit F, of a Servicing Officer of such substitution or purchase and, in the case of a substitution, upon receipt by the Indenture Trustee, of the related Indenture Trustee’s Mortgage File,
and the deposit of the Loan Repurchase Price, in the case of a purchase, or the Substitution Adjustment, if any, in connection with a substitution, in the Collection Account, the Indenture Trustee shall release to the Master Servicer for release to
the Sponsor the related Indenture Trustee’s Mortgage File and the Indenture Trustee shall execute, without recourse, and deliver such instruments of transfer furnished by the Sponsor as may be necessary to transfer such Mortgage Loan to the
Sponsor. The Indenture Trustee shall provide notice to the Note Insurer if the Sponsor fails to repurchase or substitute for a Mortgage Loan in accordance with the foregoing. 
  
 Section 2.07. Grant of Security Interest. (a) It is intended that the conveyance of the Mortgage Loans and other
property by the Seller to the Trust as provided in this Article II be, and be construed for all purposes other than tax and accounting purposes as, a sale of the Mortgage Loans and such other property by the Seller to the Trust. It is, for all
purposes other than tax and accounting purposes further, not intended that such conveyance be deemed a pledge of the Mortgage Loans or such other property by the Seller to the Trust to secure a debt or other obligation of the Seller. However, in the
event that the Mortgage Loans or any of such other property are held to be property of the Seller, or if for any reason this Agreement is held or deemed to create a security interest in the Mortgage Loans or any of such other property, then it is
intended that: (i) this Agreement shall also be deemed to be a security agreement within the meaning of the Uniform Commercial Code; (ii) the conveyance provided for in this Article II shall be deemed to be a grant by the Seller to the Trust of a
security interest in all of the Seller’s right, title and interest in and to the Mortgage Loans and such other property and all amounts payable to the holders of the Mortgage Loans in accordance with the terms thereof 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 Accounts whether in the form of cash, instruments,
securities or other property; (iii) the possession by the Indenture Trustee, of the Mortgage Notes and such other items of property as constitute instruments, money, negotiable documents or chattel paper shall be deemed to be “possession by the
secured party” for purposes of perfecting the security interest pursuant to the Uniform Commercial Code; and (iv) 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 financial intermediaries, bailees or agents, as applicable, of the Indenture Trustee for the purpose of perfecting such security interest under applicable law. The
Seller, the Sponsor, the Master Servicer, on behalf of the Trust and the Indenture Trustee, shall, to the extent consistent with this Agreement, take such actions as may be reasonably necessary to ensure that, if this Agreement 
  

 8 

 were deemed to create a security interest in the Mortgage Loans or any of such other property, 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. 
  

(b) The Seller, the Sponsor, the Master Servicer and the Backup Servicer shall take no action inconsistent with the Trust’s ownership of the Trust
Estate and each shall indicate or shall cause to be indicated in its records and records held on its behalf that ownership of each Mortgage Loan and the other assets in the Trust Estate is vested in the Trust, as owner, and is pledged to the
Indenture Trustee, for the benefit of the Noteholders and the Note Insurer pursuant to the terms of the Indenture. The Indenture Trustee is authorized to act, pursuant to the terms of this Agreement for the benefit of the Noteholders and Note
Insurer and shall be authorized to act at the direction of such parties. In addition, the Seller, the Sponsor, the Master Servicer and the Backup Servicer shall respond to any inquiries from third parties with respect to ownership of a Mortgage Loan
or any other asset in the Trust Estate by stating that it is not the owner of such asset and that the Trust is the owner of such Mortgage Loan or other asset in the Trust Estate, which is pledged to the Indenture Trustee, for the benefit of the
Noteholders and the Note Insurer. 
  
 Section 2.08. Further
Action Evidencing Assignments. (a) The Master Servicer agrees that, from time to time, at its expense, it shall cause the Sponsor or Seller, as the case may be, to, and each of the Sponsor and Seller agree that it shall, promptly execute and
deliver all further instruments and documents, and take all further action, that may be necessary or appropriate, or that the Master Servicer or the Indenture Trustee may reasonably request, in order to perfect, protect or more fully evidence the
transfer of ownership of the Mortgage Loans and other assets in the Trust Estate or to enable the Indenture Trustee, to exercise or enforce any of its rights hereunder. Without limiting the generality of the foregoing, the Master Servicer, the
Sponsor and the Seller shall, upon the request of the Master Servicer or the Indenture Trustee execute and file (or cause to be executed and filed) such real estate filings, financing or continuation statements, or amendments thereto or assignments
thereof, and such other instruments or notices, as may be necessary or appropriate. 
  
 (b) Each of the Sponsor and the Seller hereby grants to the Master Servicer, the Backup Servicer and the Indenture Trustee powers of attorney to execute all documents on its behalf under this Agreement as may be
necessary or desirable to effectuate the foregoing. 
  
 Section
2.09. Assignment of Agreement. The Sponsor, the Seller and the Master Servicer hereby acknowledge and agree that the Trust may assign its interest under this Agreement to the Indenture Trustee, for the benefit of the Noteholders and the Note
Insurer, as may be required to effect the purposes of the Indenture, without further notice to, or consent of, the Sponsor or the Master Servicer, and the Indenture Trustee shall succeed to such of the rights of the Trust hereunder as shall be so
assigned. The Trust shall, pursuant to the Indenture, assign all of its right, title and interest in and to the Mortgage Loans and its right to exercise the remedies created by Section 4.02 of this Agreement for breaches of the representations,
warranties, agreements and covenants of the Sponsor contained in Sections 3.02 and 4.01 of this Agreement, assign such right, title and interest to the Indenture Trustee, for the benefit of the Noteholders and the Note Insurer. The Sponsor agrees
that, upon such assignment to the Indenture Trustee, such representations, warranties, agreements and covenants will run to and be 
  

 9 

 for the benefit of the Indenture Trustee and the Indenture Trustee may enforce, without joinder of the Sponsor or the
Trust, the repurchase obligations of the Sponsor set forth herein with respect to breaches of such representations, warranties, agreements and covenants. 
  
 ARTICLE III 
  
 REPRESENTATIONS, WARRANTIES AND COVENANTS 
  
 Section 3.01. Representations, Warranties and Covenants of the Master Servicer. The Master Servicer hereby represents, warrants and covenants to
the Indenture Trustee, the Seller, the Sponsor, the Trust, the Note Insurer, the Backup Servicer and the Noteholders as of the Closing Date and during the term of this Agreement that: 
  
 (a) The Master Servicer is duly organized, validly existing and in good standing under the laws of its state of
incorporation and has the power to own its assets and to transact the business in which it is currently engaged. The Master Servicer is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction in which the
character of the business transacted by it or properties owned or leased by it or the performance of its obligations hereunder requires such qualification and in which the failure so to qualify could reasonably be expected to have a material adverse
effect on the business, properties, assets, or condition (financial or other) of the Master Servicer or the performance of its obligations hereunder. 
  
 (b) The Master Servicer has the power and authority to make, execute, deliver and perform this Agreement and all of the transactions contemplated under
this Agreement, and has taken all necessary corporate action to authorize the execution, delivery and performance of this Agreement, and assuming the due authorization, execution and delivery hereof by the other parties hereto constitutes, or will
constitute, the legal, valid and binding obligation of the Master Servicer, enforceable in accordance with its terms, except as enforcement of such terms may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting the rights of creditors generally, and by general equity principles (regardless of whether such enforcement is considered in a proceeding in equity or at law). 
  
 (c) The Master Servicer is not required to obtain the consent of any other party or any consent, license, approval or
authorization from, or registration or declaration with, any governmental authority, bureau or agency which consent already has not been obtained in connection with the execution, delivery, performance, validity or enforceability of this Agreement,
except such as have been obtained prior to the Closing Date. 
  
 (d) The execution, delivery and performance of this Agreement by the Master Servicer will not violate any provision of any existing law or regulation or any order or decree of any court or the charter or bylaws of the Master Servicer, or
constitute a breach of any mortgage, indenture, contract or other Agreement to which the Master Servicer is a party or by which it may be bound. 
  
 (e) Except as set forth in the “Risk Factors” section of the Prospectus Supplement, there is no action, suit, proceeding or investigation
pending or threatened against 
  

 10 

 the Master Servicer which, either in any one instance or in the aggregate, is, in the Master Servicer’s judgment,
likely to result in any material adverse change in the business, operations, financial condition, properties, or assets of the Master Servicer, or in any material impairment of the right or ability of the Master Servicer to carry on its business
substantially as now conducted, or in any material liability on the part of the Master Servicer, or which would draw into question the validity of this Agreement, the Notes, or the Mortgage Loans or of any action taken or to be taken in connection
with the obligations of the Master Servicer contemplated herein or therein, or which would be likely to impair materially the ability of the Master Servicer to perform its obligations hereunder. 
  
 (f) Neither this Agreement nor any statement, report, or other document
furnished by the Master Servicer pursuant to this Agreement or in connection with the transactions contemplated hereby, including, without limitation, the sale or placement of the Notes, contains any untrue statement of fact provided by or on behalf
of the Master Servicer or omits to state a fact necessary to make the statements provided by or on behalf of the Master Servicer contained herein or therein not misleading. 
  
 (g) The Master Servicer does not believe, nor does it have any reason or cause to believe, that it cannot perform each and
every covenant contained in this Agreement. 
  
 (h) The Master
Servicer is not an “investment company” or a company “controlled by an investment company,” within the meaning of the Investment Company Act of 1940, as amended. 
  
 (i) The Master Servicer shall take all necessary steps to maintain the Indenture Trustee’s perfection and priority in
the Mortgage Loans. 
  
 (j) The Master Servicer will fully
furnish, in accordance with the Fair Credit Reporting Act and its implementing regulations, accurate and complete information (i.e., favorable and unfavorable) on its borrower credit files to Equifax, Experian, and Trans Union Credit Information
Company (three of the credit repositories), on a monthly basis. 
  
 (k) 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, warranties and
covenants set forth in this Section 3.01 shall survive the delivery of the respective Indenture Trustee’s Mortgage Files to the Indenture Trustee and inure to the benefit of the Indenture Trustee. 
  
 Section 3.02. Representations, Warranties and Covenants of the
Sponsor. The Sponsor hereby represents, warrants and covenants to the Indenture Trustee, the Seller, the Trust, the Backup Servicer, the Note Insurer and the Master Servicer that as of the date of this Agreement or as of such date specifically
provided herein: 
  
 (a) The Sponsor is a corporation duly
organized, validly existing and in good standing under the laws of the State of California. 
  

 11 

 (b) The Sponsor has the corporate power and authority to convey the Mortgage Loans and to execute,
deliver and perform, and to enter into and consummate the transactions contemplated by this Agreement. 
  
 (c) This Agreement has been duly and validly authorized, executed and delivered by the Sponsor, all requisite corporate action having been taken, and,
assuming the due authorization, execution and delivery hereof by the other parties hereto, constitutes or will constitute the legal, valid and binding agreement of the Sponsor, enforceable against the Sponsor in accordance with its terms, except as
such enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting the rights of creditors generally, and by general equity principles (regardless of whether such enforcement is
considered in a proceeding in equity or at law). 
  
 (d) No
consent, approval, authorization or order of or registration or filing with, or notice to, any governmental authority or court is required for the execution, delivery and performance of or compliance by the Sponsor with this Agreement or the
consummation by the Sponsor of any of the transactions contemplated hereby, except as have been made on or prior to the Closing Date. 
  
 (e) None of the execution and delivery of this Agreement, the consummation of the transactions contemplated hereby or thereby, or the fulfillment of or
compliance with the terms and conditions of this Agreement, (i) conflicts or will conflict with or results or will result in a breach of, or constitutes or will constitute a default or results or will result in an acceleration under (A) the articles
of incorporation or bylaws of the Sponsor, or (B) of any term, condition or provision of any material indenture, deed of trust, contract or other agreement or instrument to which the Sponsor or any of its subsidiaries is a party or by which it or
any of its subsidiaries is bound; (ii) results or will result in a violation of any law, rule, regulation, order, judgment or decree applicable to the Sponsor of any court or governmental authority having jurisdiction over the Sponsor or its
subsidiaries; or (iii) results in the creation or imposition of any lien, charge or encumbrance which would have a material adverse effect upon the Mortgage Loans or any documents or instruments evidencing or securing the Mortgage Loans. 

 
 (f) Except as set forth in the “Risk Factors” section of the
Prospectus Supplement, there are no actions, suits or proceedings before or against or investigations of, the Sponsor pending, or to the knowledge of the Sponsor, threatened, before any court, administrative agency or other tribunal, and no notice
of any such action, which, in the Sponsor’s reasonable judgment, might materially and adversely affect the performance by the Sponsor of its obligations under this Agreement, or the validity or enforceability of this Agreement. 
  
 (g) The Sponsor 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 that may materially and adversely affect its performance hereunder. 
  
 It is understood and agreed that the representations, warranties and covenants set forth in this Section 3.02 shall survive
delivery of the respective Indenture Trustee’s Mortgage Files to the Indenture Trustee and shall inure to the benefit of the Indenture Trustee. 
  

 12 

 Section 3.03. Representations, Warranties and Covenants of the Backup Servicer. The Backup
Servicer hereby represents, warrants and covenants to the Indenture Trustee, the Trust, the Master Servicer, the Note Insurer, the Seller and the Sponsor that as of the date of this Agreement: 
  
 (a) The Backup Servicer is a corporation duly organized, validly existing
and in good standing under the laws of the State of California. 
  
 (b) The Backup Servicer has the corporate power and authority to execute, deliver and perform, and to enter into and consummate transactions contemplated by this Agreement. 
  
 (c) This Agreement has been duly and validly authorized, executed and delivered by the Backup Servicer, all requisite
corporate action having been taken, and, assuming the due authorization, execution and delivery hereof by the other parties hereto, constitutes or will constitute the legal, valid and binding agreement of the Backup Servicer, enforceable against the
Backup Servicer in accordance with its terms, except as such enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting the rights of creditors generally, and by general equity
principles (regardless of whether such enforcement is considered in a proceeding in equity or at law). 
  
 (d) No consent, approval, authorization or order of or registration or filing with, or notice to, any governmental authority or court is required for the
execution, delivery and performance of or compliance by the Backup Servicer with this Agreement or the consummation by the Backup Servicer of any of the transactions contemplated hereby, except as have been made on or prior to the Closing Date.

  
 (e) None of the execution and delivery of this Agreement, the
consummation of the transactions contemplated hereby or thereby, or the fulfillment of or compliance with the terms and conditions of this Agreement, (i) conflicts or will conflict with or results or will result in a breach of, or constitutes or
will constitute a default or results or will result in an acceleration under (A) the certificate of incorporation or bylaws of the Backup Servicer, or (B) of any term, condition or provision of any material indenture, deed of trust, contract or
other agreement or instrument to which the Backup Servicer or any of its subsidiaries is a party or by which it or any of its subsidiaries is bound; (ii) results or will result in a violation of any law, rule, regulation, order, judgment or decree
applicable to the Backup Servicer of any court or governmental authority having jurisdiction over the Backup Servicer or its subsidiaries; or (iii) results in the creation or imposition of any lien, charge or encumbrance which would have a material
adverse effect upon the Mortgage Loans or any documents or instruments evidencing or securing the Mortgage Loans; 
  
 (f) There are no actions, suits or proceedings before or against or investigations of, the Backup Servicer pending, or to the knowledge of the Backup
Servicer, threatened, before any court, administrative agency or other tribunal, and no notice of any such action, which, in the Backup Servicer’s reasonable judgment, might materially and adversely affect the performance by the Backup Servicer
of its obligations under this Agreement, or the validity or enforceability of this Agreement; and 
  

 13 

 (g) The Backup 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 that may materially and adversely affect its performance hereunder. 
  
 (h) The Backup 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, warranties and covenants set forth in this Section 3.03 shall survive delivery of the respective Indenture Trustee’s Mortgage Files to the Indenture Trustee and shall inure to the
benefit of the Indenture Trustee. 
  
 Section 3.04.
Representations, Warranties and Covenants of the Indenture Trustee. The Indenture Trustee hereby represents, warrants and covenants to the Backup Servicer, the Trust, the Master Servicer, the Seller, the Note Insurer and the Sponsor that as
of the date of this Agreement or as of such date specifically provided herein: 
  
 (a) The Indenture Trustee is a national banking association duly organized, validly existing and in good standing under the laws of the United States of America. 
  
 (b) The Indenture Trustee has the requisite power and authority to execute,
deliver and perform, and to enter into and consummate transactions contemplated by this Agreement. 
  
 (c) This Agreement has been duly and validly authorized, executed and delivered by the Indenture Trustee, all requisite action having been taken, and,
assuming the due authorization, execution and delivery hereof by the other parties hereto, constitutes or will constitute the legal, valid and binding agreement of the Indenture Trustee, enforceable against the Indenture Trustee in accordance with
its terms, except as such enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting the rights of creditors generally, and by general equity principles (regardless of whether such
enforcement is considered in a proceeding in equity or at law). 
  
 (d) No consent, approval, authorization or order of or registration or filing with, or notice to, any governmental authority or court is required for the execution, delivery and performance of or compliance by the Indenture Trustee with
this Agreement or the consummation by the Indenture Trustee of any of the transactions contemplated hereby, except as have been made on or prior to the Closing Date; 
  
 (e) None of the execution and delivery of this Agreement, the consummation of the transactions contemplated hereby or
thereby, or the fulfillment of or compliance with the terms and conditions of this Agreement, (i) conflicts or will conflict with or results or will result in a breach of, or constitutes or will constitute a default or results or will result in an
acceleration under (A) the articles of association or bylaws of the Indenture Trustee, or (B) to the best of its knowledge, of any term, condition or provision of any material indenture, deed of trust, contract or other agreement or instrument to
which the Indenture Trustee is a party or by which it is bound; or (ii) results or will result in a violation of any statute, rule, regulation, order, judgment or decree applicable to the Indenture Trustee of any court or governmental authority
having jurisdiction over the Indenture Trustee or its subsidiaries which violation would materially and adversely affect the Indenture Trustee’s performance of its duties hereunder; and 
  

 14 

 (f) There are no actions, suits or proceedings before or against or investigations of, the Indenture
Trustee, pending or to the knowledge of the Indenture Trustee threatened, before any court, administrative agency or other tribunal, and no notice of any such action, which, in the Indenture Trustee’s reasonable judgment, would materially and
adversely affect the performance by the Indenture Trustee of its obligations under this Agreement, or the validity or enforceability of this Agreement. 
  
 It is understood and agreed that the representations, warranties and covenants set forth in this Section 3.04 shall survive delivery of the respective
Indenture Trustee’s Mortgage Files to the Indenture Trustee. 
  
 Section 3.05. Covenants and Representations of the Sponsor and Master Servicer Regarding Prepayment Charges. The Master Servicer covenants that it will not waive any Prepayment Charge or part of a Prepayment Charge unless in
connection with a Mortgage Loan that is in default or for which a default is reasonably foreseeable. 
  
 (a) The Sponsor hereby represents and warrants that the information set forth in the Prepayment Charge Schedule is complete, true and correct in all
material respects at the date or dates respecting which such information is furnished and each Prepayment Charge is permissible and enforceable in accordance with its terms (except to the extent that the enforceability thereof may be limited by
bankruptcy, insolvency, moratorium, receivership and other similar laws relating to creditors’ rights generally) under applicable law. 
  
 (b) Upon discovery by the Sponsor or the Indenture Trustee of a breach of the foregoing, the party discovering such breach shall give prompt written
notice to the other parties. Within 60 days of the earlier of discovery by the Master Servicer or receipt of notice by the Master Servicer of breach, the Master Servicer shall cure such breach in all material respects. If the covenant made by the
Master Servicer in clause (a) above is breached the Master Servicer must pay into the Collection Account the amount of the waived Prepayment Charge. If the representation made by the Sponsor in clause (b) above is breached, the Sponsor must pay into
the Collection Account the amount of the scheduled Prepayment Charge, less any amount previously collected and paid by the Master Servicer into the Collection Account. The foregoing obligations of the Master Servicer and the Sponsor shall be the
sole and exclusive remedies for a breach of this Section 3.05(a) or (b). 
  
 Section 3.06. Representations, Warranties and Covenants of the Seller. The Seller, hereby represents, warrants and covenants to the Indenture Trustee, the Trust, the Sponsor, the Backup Servicer, the Note
Insurer and the Master Servicer that as of the date of this Agreement or as of such date specifically provided herein: 
  
 (a) The Seller is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. 
  

 15 

 (b) The Seller has the corporate power and authority to convey the Mortgage Loans and to execute, deliver
and perform, and to enter into and consummate the transactions contemplated by this Agreement. 
  
 (c) This Agreement has been duly and validly authorized, executed and delivered by the Seller, all requisite corporate action having been taken, and, assuming the due authorization, execution and delivery hereof by
the other parties hereto, constitutes or will constitute the legal, valid and binding agreement of the Seller, enforceable against the Seller in accordance with its terms, except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting the rights of creditors generally, and by general equity principles (regardless of whether such enforcement is considered in a proceeding in equity or at law). 
  
 (d) No consent, approval, authorization or order of or registration or filing
with, or notice to, any governmental authority or court is required for the execution, delivery and performance of or compliance by the Seller with this Agreement or the consummation by the Seller of any of the transactions contemplated hereby,
except as have been made on or prior to the Closing Date. 
  
 (e)
None of the execution and delivery of this Agreement, the consummation of the transactions contemplated hereby or thereby, or the fulfillment of or compliance with the terms and conditions of this Agreement, (i) conflicts or will conflict with or
results or will result in a breach of, or constitutes or will constitute a default or results or will result in an acceleration under (A) the articles of incorporation or bylaws of the Seller, or (B) of any term, condition or provision of any
material indenture, deed of trust, contract or other agreement or instrument to which the Seller or any of its subsidiaries is a party or by which it or any of its subsidiaries is bound; (ii) results or will result in a violation of any law, rule,
regulation, order, judgment or decree applicable to the Seller of any court or governmental authority having jurisdiction over the Seller or its subsidiaries; or (iii) results in the creation or imposition of any lien, charge or encumbrance which
would have a material adverse effect upon the Mortgage Loans or any documents or instruments evidencing or securing the Mortgage Loans. 
  
 (f) There are no actions, suits or proceedings before or against or investigations of, the Seller pending, or to the knowledge of the Seller, threatened,
before any court, administrative agency or other tribunal, and no notice of any such action, which, in the Seller’s reasonable judgment, might materially and adversely affect the performance by the Seller of its obligations under this
Agreement, or the validity or enforceability of this Agreement. 
  
 (g) The Seller 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 that may materially and adversely affect its performance hereunder.

  
 It is understood and agreed that the representations,
warranties and covenants set forth in this Section 3.05 shall survive delivery of the respective Indenture Trustee’s Mortgage Files to the Indenture Trustee and shall inure to the benefit of the Indenture Trustee. 
  

 16 

 ARTICLE IV 
  

THE MORTGAGE LOANS 
  
 Section 4.01. Representations and Warranties Concerning the Mortgage Loans. The Sponsor makes the following representations and warranties to the
Seller, the Master Servicer, the Backup Servicer, the Indenture Trustee, the Note Insurer and the Trust as to the Mortgage Loans on which the Trust relies in accepting the Mortgage Loans in trust and executing the Notes. With respect to the
representations and warranties stated in Sections 4.01(i), (r), (ddd), (eee) and (fff), the Sponsor makes such representations and warranties on behalf of itself and the Seller. Such representations, warranties and covenants are made or deemed to be
made as of the Closing Date. 
  
 (a) The information with
respect to each Mortgage Loan set forth in the Mortgage Loan Schedule is true and correct as of the Cut-Off Date, based on Cut-Off Date Principal Balances. 
  
 (b) Each Mortgage Loan is being serviced either (i) through the Master Servicer or (ii) a Person controlling, controlled by or under common control with
the Master Servicer and qualified to service mortgage loans. 
  
 (c) Each Mortgage Loan was underwritten or reunderwritten pursuant to the Underwriting Guidelines which conform in all material respects to the description thereof set forth in the Prospectus Supplement. 
  
 (d) All of the original or certified documentation required to be delivered
to the Indenture Trustee pursuant to this Agreement (including all material documents related thereto) with respect to each Mortgage Loan has been or will be delivered to the Indenture Trustee in accordance with the terms of this Agreement. Each of
the documents and instruments specified to be included therein has been duly executed and in due and proper form, and each such document or instrument is in a form generally acceptable to prudent mortgage lenders that regularly originate or purchase
mortgage loans comparable to the Mortgage Loans for sale to prudent investors in the secondary market that invest in mortgage loans such as the Mortgage Loans. 
  

(e) [Reserved]. 
  
 (f) Each Mortgaged Property is improved by a single (one to four) family residential dwelling, which may include condominiums, individual units in a
planned unit development and townhouses but shall not include cooperatives. 
  
 (g) No Mortgage Loan had an LTV in excess of 95%. 
  
 (h) Each Mortgage Loan is a valid and subsisting first lien as identified on the Mortgage Loan Schedule on the Mortgaged Property and subject in all cases to the exceptions to title set forth in the title insurance
policy, with respect to the related Mortgage Loan, which exceptions are generally acceptable to banking institutions in connection with their regular mortgage lending activities, and such other exceptions to which similar properties are commonly

  

 17 

 subject and which do not individually, or in the aggregate, materially and adversely affect the benefits of the security
intended to be provided by such Mortgage. At the time each Mortgage Loan was originated, the originator was a mortgagee approved by the Secretary of Housing and Urban Development pursuant to Sections 203 and 211 of the National Housing Act or a
savings and loan association, a savings bank, a commercial bank or similar banking institution which was supervised and examined by a federal or state authority or a mortgage banker or broker licensed or authorized to do business in the jurisdiction
in which the related Mortgaged Property is located, applying the same standards and procedures used by the Sponsor in originating Mortgage Loans directly. 
  
 (i) Immediately prior to the transfer and assignment of the Mortgage Loans to the Seller pursuant to the Master Sale and Purchase Agreement, the Sponsor
held good and marketable title to, and was the sole owner of each Mortgage Loan, subject to no liens, charges, mortgages or encumbrances or rights of others, except liens of third party warehouse lenders that will be released simultaneously with the
transfer and assignment contemplated herein; and immediately prior to the transfer and assignment herein contemplated, the Seller held good and marketable title to, and was the sole owner of, each Mortgage Loan subject to no liens, charges,
mortgages, encumbrances or rights of others except liens which will be released simultaneously with such transfer and assignment; and immediately upon the transfer and assignment herein contemplated, the Indenture Trustee will hold good and
marketable title to, and be the sole owner of, each Mortgage Loan subject to no liens, charges, mortgages, encumbrances or rights of others except liens which will be released simultaneously with such transfer and assignment. 
  
 (j) There is no delinquent tax or assessment lien on any Mortgaged Property,
and each Mortgaged Property is free of substantial damage and is in good repair. 
  
 (k) There is no valid and enforceable right of rescission, offset, defense or counterclaim to any Mortgage Note or Mortgage, including the obligation of the related Mortgagor to pay the unpaid principal of or interest
on such Mortgage Note or the defense of usury, nor will the operation of any of the terms of the Mortgage Note or the Mortgage, or the exercise of any right thereunder, render either the Mortgage Note or the Mortgage unenforceable in whole or in
part, or subject to any right of rescission, set-off, counterclaim or defense, including the defense of usury, and no such right of rescission, set-off, counterclaim or defense has been asserted with respect thereto. 
  
 (l) There is no mechanics’ lien or claim for work, labor or material
affecting any Mortgaged Property which is or may be a lien prior to, or equal with, the lien of the related Mortgage except those which are insured against by any title insurance policy referred to in paragraph (n) below. 
  
 (m) Each Mortgage Loan at the time it was made complied with, and each
Mortgage Loan at all times was serviced in compliance with, in each case, in all material respects, applicable state and federal laws and regulations, including, without limitation, the federal Truth-in-Lending Act and other consumer protection
laws, the Home Ownership and Equity Protection Act of 1994, real estate settlement procedure, usury, equal credit opportunity, disclosure and recording laws and all applicable predatory and abusive lending laws. 
  

 18 

 (n) With respect to each Mortgage Loan, a lender’s title insurance policy, issued in standard
California Land Title Association form or American Land Title Association form, or other form acceptable in a particular jurisdiction by a title insurance company authorized to transact business in the state in which the related Mortgaged Property
is situated, in an amount at least equal to the original Principal Balance of such Mortgage Loan insuring the mortgagee’s interest under the related Mortgage Loan as the holder of a valid first mortgage lien of record on the real property
described in the related Mortgage, as the case may be, subject only to exceptions of the character referred to in paragraph (h) above, was effective on the date of the origination of such Mortgage Loan, and, as of the Closing Date such policy will
be valid and inure to the benefit of the Indenture Trustee on behalf of the Noteholders. 
  
 (o) The improvements upon each Mortgaged Property are covered by a valid and existing hazard insurance policy (which may be a blanket policy of the type described in this Agreement) with a generally acceptable carrier
that provides for fire and extended coverage representing coverage not less than the least of (i) the outstanding Principal Balance of the related Mortgage Loan, (ii) the minimum amount required to compensate for damage or loss on a replacement cost
basis or (iii) the full insurable value of the Mortgaged Property. 
  
 (p) If any Mortgaged Property is in an area identified in the Federal Register by the Federal Emergency Management Agency as having special flood hazards, a flood insurance policy (which may be a blanket policy of the type described in this
Agreement) in a form meeting the requirements of the current guidelines of the Federal Insurance Administration is in effect with respect to such Mortgaged Property with a generally acceptable carrier in an amount representing coverage not less than
the least of (i) the outstanding Principal Balance of the related Mortgage Loan (together, in the case of a second mortgage loan, with the outstanding principal balance of the first mortgage loan), (ii) the minimum amount required to compensate for
damage or loss on a replacement cost basis or (iii) the maximum amount of insurance that is available under the Flood Disaster Protection Act of 1973. 
  
 (q) Each Mortgage and Mortgage Note is the legal, valid and binding obligation of the maker thereof and is enforceable in accordance with its terms,
except only as such enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights generally and by general principles of equity (whether considered in a
proceeding or action in equity or at law), and all parties to each Mortgage Loan had full legal capacity to execute all documents relating to such Mortgage Loan and convey the estate therein purported to be conveyed. 
  
 (r) The Sponsor has directed and the Seller has caused to be performed any
and all acts required to be performed to preserve the rights and remedies of the Indenture Trustee in any Insurance Policies applicable to any Mortgage Loan delivered by the Sponsor or the Seller including, to the extent such Mortgage Loan is not
covered by a blanket policy described in this Agreement, any necessary notifications of insurers, assignments of policies or interests therein, and establishments of coinsured, joint loss payee and mortgagee rights in favor of the Indenture Trustee.

  
 (s) The Sponsor has caused or will have caused, within ten
days, the filing of all appropriate financing statements in the proper filing office in the appropriate jurisdictions 
  

 19 

 under applicable law in order to perfect the security interest in the original Mortgage Note and all subsequent
assignments of the original Mortgage, granted to the Indenture Trustee hereunder, subject to the provisions of Section 2.05(b) of this Agreement. 
  
 (t) The terms of each Mortgage Note and each Mortgage have not been impaired, altered or modified in any respect, except by a written instrument which has
been recorded, if necessary, to protect the interest of the Noteholders and which has been delivered to the Indenture Trustee. 
  
 (u) The proceeds of each Mortgage Loan have been fully disbursed, and there is no obligation on the part of the mortgagee to make future advances
thereunder. All costs, fees and expenses incurred in making or closing or recording such Mortgage Loans were paid. 
  
 (v) Except as otherwise required by law or pursuant to the statute under which the related Mortgage Loan was made, the related Mortgage Note is not and
has not been secured by any collateral, pledged account or other security except the lien of the corresponding Mortgage. 
  
 (w) No Mortgage Loan was originated under a buydown plan. 
  
 (x) No Mortgage Loan provides for negative amortization, has a shared appreciation feature, or other contingent interest feature. 
  
 (y) Each Mortgaged Property is located in the state identified in the
Mortgage Loan Schedule and consists of one or more parcels of real property with a residential dwelling erected thereon. 
  
 (z) Each Mortgage securing a Mortgage Note contains a provision for the acceleration of the payment of the unpaid Principal Balance of the related
Mortgage Loan in the event the related Mortgaged Property is sold without the prior consent of the mortgagee thereunder. 
  
 (aa) Any advances made after the date of origination of a Mortgage Loan but prior to the Cut-Off Date, have been consolidated with the outstanding
principal amount secured by the related Mortgage, and the secured principal amount, as consolidated, bears a single interest rate and single repayment term reflected on the Mortgage Loan Schedule. The consolidated principal amount does not exceed
the original principal amount of the related Mortgage Loan. No Mortgage Note permits or obligates the Seller, the Master Servicer, the Backup Servicer, the Sponsor or any other Person to make future advances to the related Mortgagor at the option of
the Mortgagor. 
  
 (bb) There is no proceeding pending or
threatened for the total or partial condemnation of any Mortgaged Property, nor is such a proceeding currently occurring, and each Mortgaged Property is undamaged by waste, fire, earthquake or earth movement, flood, tornado or other casualty, so as
to affect adversely the value of the Mortgaged Property as security for the Mortgage Loan or the use for which the premises were intended. 
  

 20 

 (cc) All of the improvements which were included for the purposes of determining the Appraised Value of
any Mortgaged Property lie wholly within the boundaries and building restriction lines of such Mortgaged Property, and no improvements on adjoining properties encroach upon such Mortgaged Property, except as stated in the related title insurance
policy and affirmatively insured. 
  
 (dd) No improvement located
on or being part of any Mortgaged Property is in violation of any applicable zoning law or regulation. As of the related date of origination, all inspections, licenses and certificates required to be made or issued with respect to all occupied
portions of each Mortgaged Property and, with respect to the use and occupancy of the same, including, but not limited to, certificates of occupancy and fire underwriting certificates, have been made or obtained from the appropriate authorities and
such Mortgaged Property is lawfully occupied under the applicable law. 
  
 (ee) With respect to each Mortgage constituting a deed of trust, a trustee, duly qualified under applicable law to serve as such, has been properly designated and currently so serves and is named in such Mortgage, and no fees or expenses
are or will become payable by the Sponsor, the Seller, or the Trust to the trustee under the deed of trust, except in connection with a trustee’s sale after default by the related Mortgagor. 
  
 (ff) [Reserved]. 
  
 (gg) [Reserved]. 
  
 (hh) Each Mortgage contains customary and enforceable provisions which render
the rights and remedies of the holder thereof adequate for the realization against the related Mortgaged Property of the benefits of the security, including (i) in the case of a Mortgage designated as a deed of trust, by trustee’s sale and (ii)
otherwise by judicial foreclosure. There is no homestead or other exemption available which materially interferes with the right to sell the related Mortgaged Property at a trustee’s sale or the right to foreclose the related Mortgage.

  
 (ii) Except for delinquencies identified in the Mortgage Loan
Schedule, there is no default, breach, violation or event of acceleration existing under any Mortgage or the related Mortgage Note and no event which, with the passage of time or with notice and the expiration of any grace or cure period, would
constitute a default, breach, violation or event of acceleration; and the Seller has not waived any default, breach, violation or event of acceleration. 
  
 (jj) No instrument of release or waiver has been executed in connection with any Mortgage Loan, and no Mortgagor has been released, in whole or in part.

  
 (kk) [Reserved]. 
  
 (ll) The Sponsor has no actual knowledge that there exists on any Mortgaged
Property any hazardous substances, hazardous wastes or solid wastes, as such terms are defined in the CERCLA, the Resource Conservation and Recovery Act of 1976, or other federal, state or local environmental legislation. 
  

 21 

 (mm) No action, error, omission, misrepresentation, negligence, fraud or similar occurrence with respect
to a Mortgage Loan has taken place on the part of any person, including, without limitation, the Mortgagor, any appraiser, any builder or developer, or any other party involved in the origination of the Mortgage Loan or in the application of any
insurance in relation to such Mortgage Loan. 
  
 (nn) The Sponsor
has not solicited the Mortgagor in connection with any refinancing. 
  
 (oo) If the Mortgage Loan is an adjustable rate Mortgage Loan, all of the adjustments to the Mortgage Interest Rate, to the amount of the monthly payment, and to the principal balance have been made in accordance with the terms of the
related Mortgage Note. 
  
 (pp) The origination and collection
practices used with respect to the Mortgage Loan have been in all respects legal, proper, prudent and customary in the mortgage origination and servicing business. 
  
 (qq) An appraisal of the related Mortgaged Property was made and signed, prior to the approval of the Mortgage Loan
application, by a qualified appraiser who met the requirements of the Sponsor’s appraisal policy and procedures and who had no interest, direct or indirect in the Mortgaged Property or in any loan made on the security thereof, whose
compensation was not affected by the approval or disapproval of the Mortgage Loan. 
  
 (rr) The Mortgagor has received all disclosure materials required by applicable law with respect to the making of adjustable rate mortgage loans; and if the Mortgage Loan is a refinanced Mortgage Loan, the Mortgagor
has received all disclosure and rescission materials required by applicable law with respect to the making of a refinanced Mortgage Loan, and evidence of such receipt is and will remain in the Master Servicer’s file. 
  
 (ss) If the residential dwelling on the Mortgaged Property is a condominium
unit or a unit in a planned unit development (other than a de minimis planned unit development), such condominium or planned unit development project meets the Sponsor’s eligibility requirements. 
  
 (tt) As of the Cut-Off Date, none of the Mortgage Loans in Group 1 and Group
2 were more than 29 days contractually delinquent or had been dishonored. None of the Mortgage Loans have been thirty or more days delinquent more than one time in the twelve months preceding the Cut-Off Date. 
  
 (uu) The Sponsor has not advanced funds, or induced, solicited or knowingly
received any advance of funds by a person other than the Mortgagor, directly or indirectly, for the payment of any amount required under the Mortgage Loan, except for interest prepaid upon the closing of the Mortgage Loan. No Mortgage Loan contains
any provision pursuant to which Monthly Payments are: (i) paid or partially paid with funds deposited in any separate account established by the Sponsor, the Mortgagor, or anyone on behalf of the Mortgagor or (ii) paid by any source other than the
Mortgagor. The Mortgage Loan is not deemed a graduated payment mortgage loan and the Mortgage Loan does not have a shared appreciation or other contingent interest feature. 
  

 22 

 (vv) No foreclosure proceedings are pending against the Mortgaged Property and the Mortgage Loan is not
subject to any pending bankruptcy or insolvency proceeding, and to the Sponsor’s best knowledge, no material litigation or material lawsuit relating to the Mortgage Loan is pending. 
  
 (ww) Principal payments on the Mortgage Loan commenced or will commence within sixty days after the proceeds of the Mortgage
Loan were disbursed. 
  
 (xx) With respect to escrow deposits, if
any, all such payments are in the possession of, or under the control of, the Master Servicer and there exists no deficiencies in connection therewith for which customary arrangements for repayment thereof have not been made or could be made. No
escrow deposits or escrow advances or other charges or payments due the Master Servicer have been capitalized under any Mortgage or the related Mortgage Note. 
  

(yy) With respect to the conveyance of the Mortgage Loans by the Sponsor to the Seller, the Sponsor used no selection procedures that identified the
Mortgage Loans as being less desirable or valuable than other comparable mortgage loans originated or acquired by the Sponsor. The Mortgage Loans are representative of the Sponsor’s portfolio of fixed-rate or adjustable-rate mortgage loans, as
applicable. With respect to the conveyance of the Mortgage Loans pursuant to this Agreement, the Seller used no selection procedures that identified the Mortgage Loans as being less desirable or valuable than other comparable mortgage loans
originated or acquired by the Seller. The Mortgage Loans are representative of the Seller’s portfolio of fixed-rate or adjustable-rate mortgage loans, as applicable. 
  
 (zz) Each Mortgage Loan conforms, and all such Mortgage Loans in the aggregate conform in all material respects to the
description thereof set forth in the Prospectus Supplement. 
  
 (aaa) All requirements for the valid transfer of each Insurance Policy, including any assignments or notices required in each Insurance Policy, have been satisfied. 
  
 (bbb) This Agreement creates a valid and continuing security interest (as defined in the applicable UCC) in the Mortgage
Loans in favor of the Indenture Trustee, which security interest is prior to all other liens, and is enforceable as such as against creditors of and purchasers from the Seller. 
  
 (ccc) The Mortgage Loans constitute “instruments” within the meaning of the applicable UCC. 
  
 (ddd) The Sponsor received all consents and approvals required by the terms
of the Mortgage Loans to the sale of the Mortgage Loans pursuant to the Master Sale and Purchase Agreement to the Seller and the Seller has received all consents and approvals required by the terms of the Mortgage Loans to the sale of the Mortgage
Loans hereunder to the Owner Trustee and the subsequent pledge to the Indenture Trustee. 
  
 (eee) Other than the security interest granted to the Indenture Trustee pursuant to the Indenture, neither the Sponsor nor the Seller has pledged, assigned, sold, granted a security interest in, or otherwise conveyed
any of the Mortgage Loans. Neither the Sponsor nor the Seller 
  

 23 

 has authorized the filing of nor is aware of any financing statements against the Sponsor or the Seller that include a
description of collateral covering the Mortgage Loans other than any financing statement relating to the security interest granted to the Indenture Trustee hereunder or that has been terminated. Neither the Sponsor nor the Seller is aware of any
judgment or tax lien filings affecting the Mortgage Loans against either the Seller or the Sponsor. 
  
 (fff) All financing statements filed or to be filed against the Sponsor or the Seller in favor of the Indenture Trustee in connection herewith describing
the Mortgage Loans contain a statement to the following effect: “A purchase of or security interest in any collateral described in this financing statement will violate the rights of the Indenture Trustee.” 
  
 (ggg) None of the Mortgage Loans are classified as (a) “high cost”
loans under the Home Ownership and Equity Protection Act of 1994 or (b) “high cost,” “threshold,” “covered”, “predatory” or “abusive” loans under any other applicable state, federal or local law.

  
 (hhh) No proceeds from any Mortgage Loan were used to finance
single-premium credit insurance policies; 
  
 (iii) No Mortgage
Loan originated between October 1, 2002 and March 7, 2003 is secured by a Mortgaged Property located in the state of Georgia. There is no Mortgage Loan that was originated on or after March 7, 2003 that is a “high cost home loan” as
defined under the Georgia Fair Lending Act. 
  
 (jjj) No Mortgage
Loan is secured by a leasehold interest, unless such leasehold interest extends 60 months beyond the stated maturity of the Mortgage Note. 
  
 (kkk) With respect to the Mortgage Loans in Group II, (i) no Mortgage Loan imposes a prepayment premium for a term in excess of three years, (ii) the
servicer for each Mortgage Loan has fully furnished, in accordance with the Fair Credit Reporting Act and its implementing regulations, accurate and complete information (i.e., favorable and unfavorable) on its borrower credit files to Equifax,
Experian, and Trans Union Credit Information Company (three of the credit repositories), on a monthly basis and (iii) the original Principal Balance of each Mortgage Loan is within Freddie Mac’s dollar amount limits for conforming one- to
four-family mortgage loans, as follows: 
  

							
	 Number of Units

	  	Maximum Original Loan Amount of First Mortgage

	 	  	 Continental United States
 or Puerto Rico

	  	 Alaska, Guam, Hawaii
 or Virgin Islands

	 1
	  	$	322,700	  	$	484,050
	 2
	  	 	413,100	  	 	619,650
	 3
	  	 	499,300	  	 	748,950
	 4
	  	 	620,500	  	 	930,750

  
 It is understood and
agreed that the representations, warranties and covenants set forth in this Section 4.01 shall survive delivery of the respective Indenture Trustee’s Mortgage Files to the Indenture Trustee and shall inure to the benefit of the Indenture
Trustee on behalf of the Noteholders and the Note Insurer. 
  

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 Section 4.02. Purchase and Substitution. (a) It is understood and agreed that the representations
and warranties set forth in Section 4.01 shall survive the transfer of the Mortgage Loans by the Seller to the Trust, the subsequent pledge thereof by the Trust to the Indenture Trustee, for the benefit of the Noteholders and the Note Insurer, and
the delivery of the Notes to the Noteholders, and shall continue in full force and effect, notwithstanding any restrictive or qualified endorsement on the Mortgage Notes and notwithstanding subsequent termination of this Agreement.

  
 (b) Upon discovery by the Seller, the Sponsor, the Master
Servicer, the Indenture Trustee, the Note Insurer or a Noteholder of a breach of any of the representations and warranties in Section 4.01 which materially and adversely affects the value of any Mortgage Loan, or which materially and adversely
affects the interests of the Note Insurer or the Noteholders in the related Mortgage Loan, the party discovering such breach or failure shall promptly (and in any event within five (5) days of the discovery) give written notice thereof to the
others. Within sixty (60) days of the earlier of its discovery or its receipt of notice of any breach of a representation or warranty, the Sponsor shall (a) promptly cure such breach in all material respects, (b) purchase such Mortgage Loan on the
next succeeding Servicer Remittance Date, in the manner and at the price specified in Section 2.06(c) and this Section 4.02, or (c) remove such Mortgage Loan from the Trust Estate (in which case it shall become a Deleted Mortgage Loan) and
substitute one or more Qualified Substitute Mortgage Loans in the manner specified in Section 2.06 and this Section 4.02. The Indenture Trustee shall deliver prompt written notice to the Note Insurer and the Rating Agencies of any repurchase or
substitution made pursuant to this Section 4.02 or Section 2.06(c). 
  
 (c) As to any Deleted Mortgage Loan for which the Sponsor substitutes a Qualified Substitute Mortgage Loan or Loans, the Master Servicer shall cause the Sponsor to effect such substitution by delivering to the Indenture Trustee a
certification, in the form attached hereto as Exhibit F, executed by a Servicing Officer, and the documents described in Sections 2.05(a)(i)-(vi) for such Qualified Substitute Mortgage Loan or Loans. 
  
 (d) The Master Servicer shall deposit in the Collection Account all payments
received in connection with such Qualified Substitute Mortgage Loan or Loans after the date of such substitution. Monthly Payments due with respect to Qualified Substitute Mortgage Loans in or before the Due Period in which the substitution occurs
shall not be part of the Trust Estate and will be retained by the Sponsor on the next succeeding Payment Date. For the Due Period in which the substitution occurs, distributions to Noteholders will include the Monthly Payment due on any Deleted
Mortgage Loan for such Due Period and thereafter the Sponsor shall be entitled to retain all amounts received in respect of such Deleted Mortgage Loan. The Master Servicer shall give written notice to the Backup Servicer, the Indenture Trustee and
the Note Insurer that such substitution has taken place and shall amend the Mortgage Loan Schedule to reflect the removal of such Deleted Mortgage Loan from the terms of this Agreement and the substitution of the Qualified Substitute Mortgage Loan
or Loans. Upon such substitution, such Qualified Substitute Mortgage Loan or Loans shall be subject to the terms of this Agreement in all respects. 
  
 (e) With respect to any Mortgage Loan that has been converted to an REO Mortgage Loan, all references in this Section 4.02 or Section 2.06 to
“Mortgage Loan” shall be 
  

 25 

 deemed to also refer to the REO Mortgage Loan. With respect to any Mortgage Loan that the Sponsor is required to
repurchase that is or becomes a Liquidated Mortgage Loan, in lieu of repurchasing such Mortgage Loan, the Master Servicer shall deposit into the related Payment Account, pursuant to Section 8.01 of the Indenture, an amount equal to the amount of the
Liquidated Loan Loss, if any, incurred in connection with the liquidation of such Mortgage Loan within the same time period in which the Master Servicer or Sponsor would have otherwise been required to repurchase such Mortgage Loan. 
  
 (f) It is understood and agreed that the obligations of the Sponsor set forth
in Sections 2.06 and 4.02 to cure, purchase or substitute for a defective Mortgage Loan, or to indemnify as described in Section 4.02(g) constitute the sole remedies of the Indenture Trustee, the Note Insurer and the Noteholders respecting a breach
of the representations and warranties of the Sponsor set forth in Section 4.01 of this Agreement. 
  
 (g) The Sponsor shall be obligated to indemnify the Seller, the Indenture Trustee, the Trust, the Owner Trustee, the Noteholders and the Note Insurer for
any third party claims arising out of a breach by the Sponsor of representations or warranties regarding the Mortgage Loans. 
  
 ARTICLE V 
  
 ADMINISTRATION AND SERVICING OF THE MORTGAGE LOANS 
  
 Section 5.01. The Master Servicer. (a) The Master Servicer shall service and administer the Mortgage Loans in accordance with this Agreement and in
accordance with Accepted Servicing Practices, and shall have full power and authority, acting alone, to do or cause to be done any and all things in connection with such servicing and administration which it may deem necessary or desirable.

  
 (b) The Master Servicer shall exercise its discretion
consistent with Accepted Servicing Practices and the terms of this Agreement, with respect to the enforcement of defaulted Mortgage Loans in such manner as will maximize the receipt of principal and interest with respect thereto, including but not
limited to the sale of such Mortgage Loan to a third party, the modification of such Mortgage Loan, or foreclosure upon the related property with a Mortgage and disposition thereof. 
  
 (c) The duties of the Master Servicer shall include collecting and posting of all payments, responding to inquiries of
Mortgagors or by federal, state or local government authorities with respect to the Mortgage Loans, investigating delinquencies, reporting tax information to Mortgagors in accordance with its customary practices and accounting for collections and
furnishing monthly and annual statements to the Indenture Trustee with respect to distributions, paying Compensating Interest and making Delinquency Advances and Servicing Advances pursuant hereto. The Master Servicer shall follow its customary
standards, policies and procedures in performing its duties as Master Servicer. The Master Servicer shall cooperate with the Indenture Trustee and furnish to the Indenture Trustee with reasonable promptness information in its possession as may be
necessary or appropriate to enable the Indenture Trustee to perform its tax reporting duties hereunder. The Indenture Trustee shall furnish the Master 
  

 26 

 Servicer, or the Backup Servicer with any powers of attorney and other documents as the Indenture Trustee shall deem
necessary or appropriate to enable the Master Servicer, and the Backup Servicer to carry out its servicing and administrative duties hereunder; provided, however, the Master Servicer, or the Backup Servicer shall prepare for and deliver to the
Indenture Trustee for its execution any such powers of attorney; provided, further, that the Indenture Trustee shall not be responsible for any misuse of any such power of attorney. 
  
 (d) [Reserved]. 
  
 (e) The Master Servicer shall, in accordance with Accepted Servicing Practices, have the right to approve requests of Mortgagors for consent to (i)
partial releases of Mortgage Loans and (ii) alterations, removal, demolition or division of Mortgaged Properties subject to Mortgage Loans. No such request shall be approved by the Master Servicer unless: (x) the provisions of the related Mortgage
Note have been complied with; (y) the LTV (which may, for this purpose, be determined at the time of any such action in a manner reasonably acceptable to the Note Insurer) after any release does not exceed the LTV set forth for such Mortgage Loan in
the Mortgage Loan Schedule; and (z) the lien priority, monthly payment, Mortgage Interest Rate or maturity date of the related Mortgage is not affected except in accordance with Section 5.01(f); provided, however, that the foregoing
requirements (x), (y) and (z) shall not apply to any such situation described in this paragraph if such situation results from any condemnation or easement activity by a governmental entity. 
  
 (f) Notwithstanding anything else contained herein, the Master Servicer may
not, without the consent of the Note Insurer, agree to a modification or extension of any Mortgage Loan unless both (i) such Mortgage Loan is in default or a default thereon is reasonably foreseeable and (ii) such modification or extension would not
result in the Master Servicer agreeing to modifications or extensions on Mortgage Loans with aggregate Cut-Off Date Principal Balances of more than 5.0% of the Maximum Collateral Amount. In addition, the Master Servicer may not agree to more than
(i) one modification or extension with respect to any individual Mortgage Loan in a calendar year or (ii) three modifications or extensions of an individual Mortgage Loan during the life of such Mortgage Loan. 
  
 (g) [Reserved]. 
  
 (h) Without limiting the generality of the foregoing, but subject to Sections 5.05 and 5.06, the Master Servicer in its own
name may be authorized and empowered pursuant to a power of attorney executed and delivered by the Indenture Trustee to execute and deliver, and may be authorized and empowered by the Indenture Trustee, to execute and deliver, on behalf of itself,
the Noteholders and the Indenture Trustee or any of them, (i) any and all instruments of satisfaction or cancellation or of partial or full release or discharge and all other comparable instruments with respect to the Mortgage Loans and with respect
to the Mortgaged Properties, (ii) and to institute foreclosure proceedings or obtain a deed in lieu of foreclosure so as to effect ownership of any Mortgaged Property on behalf of the Indenture Trustee, and (iii) to hold title to any Mortgaged
Property upon such foreclosure or deed in lieu of foreclosure on behalf of the Indenture Trustee; provided, however, that Section 5.07(a) shall constitute a power of attorney from the Indenture Trustee to the Master Servicer to execute
an instrument of satisfaction (or assignment of mortgage without recourse) with respect to any Mortgage Loan 
  

 27 

 paid in full (or with respect to which payment in full has been escrowed). Subject to Sections 5.05 and 5.06, the
Indenture Trustee shall furnish the Master Servicer with any powers of attorney and other documents as the Master Servicer shall reasonably request to enable the Master Servicer to carry out their respective servicing and administrative duties
hereunder; provided, however, the Master Servicer shall prepare for and deliver to the Indenture Trustee for its execution any such powers of attorney; provided, further, that the Indenture Trustee shall not be responsible for any misuse of any such
power of attorney. 
  
 (i) The Master Servicer shall give prompt
notice to the Backup Servicer, the Indenture Trustee and the Note Insurer of any action, of which the Master Servicer has actual knowledge, to (i) assert a claim against the Trust or (ii) assert jurisdiction over the Trust. 
  
 (j) Servicing Advances incurred by the Master Servicer in connection with the
servicing of the Mortgage Loans (including any penalties in connection with the payment of any taxes and assessments or other charges) on any Mortgaged Property shall be recoverable by the Master Servicer to the extent described herein. 

 
 (k) The Master Servicer shall be entitled to rely, and shall be fully
protected in relying, upon any promissory note, writing, resolution, notice, consent, certificate, affidavit, letter, e-mail, cablegram, telegram, telecopy, telex or teletype message, statement, order or other document reasonably believed by it to
be genuine and correct and to have been signed, sent or made by the proper person or persons and upon advice and statements of legal counsel (including, without limitation, counsel to the Mortgagor(s)), independent accountants and other experts
selected by the Master Servicer. 
  
 (l) The Master Servicer shall
have no liability to the Seller, the Sponsor, the Indenture Trustee, the Owner Trustee, the Note Insurer, any Noteholder or any other Person 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 the foregoing shall not apply to any breach of representations or warranties made by the Master Servicer herein, or to any specific liability imposed upon the Master Servicer pursuant to
this Agreement or any liability that would otherwise be imposed upon the Master Servicer by reason of its willful misconduct, bad faith or negligence in the performance of its duties hereunder or by reason of its failure to perform its obligations
or duties hereunder. 
  
 (m) The Master Servicer further is
authorized and empowered by the Indenture Trustee, on behalf of the Noteholders, the Note Insurer and the Indenture Trustee, when the Master Servicer believes it is appropriate in its best judgment to register any Mortgage Loan on the MERS System,
or cause the removal from the registration of any Mortgage Loan on the MERS System, to execute and deliver, on behalf of the Indenture Trustee, the Note Insurer and the Noteholders 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 Indenture Trustee and its successors and assigns. Any expenses incurred in connection with the actions described in
the preceding sentence shall be reimbursable to the Master Servicer as Servicing Advances. 
  

 28 

 Section 5.02. Collection of Certain Mortgage Loan Payments; Collection 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, follow Accepted Servicing Practices.
Consistent with the foregoing, the Master Servicer may in its discretion waive any assumption fees or other fees which may be collected in the ordinary course of servicing such Mortgage Loans. 
  
 (b) The Master Servicer shall establish and maintain, in the name of the
Indenture Trustee, a segregated account (the “Collection Account”), in trust for the benefit of the Noteholders and the Note Insurer. The Collection Account shall be established and maintained as an Eligible Account. 
  
 (c) The Master Servicer shall deposit in the Collection Account any amounts
representing Monthly Payments on the Mortgage Loans due or to be applied as of a date after the Cut-Off Date on each Business Day, not more than two Business Days after the date of collection, the following payments and collections received or made
by it (other than in respect of monthly payments of principal on and interest of the Mortgage Loans that were due on or before the related Cut-Off Date and Monthly Payments due on February 1, 2004): 
  
 (i) payments of interest on the Mortgage Loans including
Prepayment Charges; 
  
 (ii) payments of
principal of the Mortgage Loans, including Principal Prepayments; 
  
 (iii) the Loan Repurchase Price of Mortgage Loans repurchased pursuant to Sections 2.06(c) or 4.02; 
  
 (iv) the Substitution Adjustment received in connection with Mortgage Loans for which Qualified Substitute Mortgage Loans are received
pursuant to Sections 2.06 and 4.02; 
  
 (v) all
Net REO Proceeds; 
  
 (vi) all Net Liquidation
Proceeds; and 
  
 (vii) all Insurance Proceeds
(including, for this purpose, any amounts required to be deposited by the Master Servicer pursuant to Section 5.04 hereof). 
  
 It is understood that the Master Servicer need not deposit amounts representing fees, late payment charges or extension or other administrative charges
(other than Prepayment Charges) payable by Mortgagors, or amounts received by the Master Servicer for the account of Mortgagors for application towards the payment of taxes, insurance premiums, assessments and similar items or foreclosure proceeds
to the extent payable to the related Mortgagor. 
  
 (d) The Master
Servicer shall invest any funds in the Collection Account in Permitted Investments, which shall mature not later than the Business Day next preceding the Servicer Remittance Date next following the date of such investment (except that any investment

  

 29 

 held by the Indenture Trustee may mature on such Servicer Remittance Date) and shall not be sold or disposed of prior to
its maturity. All net 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 on a Servicer Remittance Date. The Master Servicer shall deposit from its own
funds the amount of any loss, to the extent not offset by investment income or earnings, in the Collection Account upon the realization of such loss. 
  
 Section 5.03. Permitted Withdrawals from the Collection Account. The Master Servicer may make withdrawals from the Collection Account, on or prior
to any Servicer Remittance Date, for the following purposes: 
  
 (a) to pay to the Sponsor amounts received in respect of any Defective Mortgage Loan purchased or substituted for by the Sponsor to the extent that the payment of any such amounts on the Servicer Remittance Date upon which the proceeds of
such purchase are paid would make the total amount distributed in respect of any such Mortgage Loan on such Servicer Remittance Date greater than the Loan Repurchase Price or the Substitution Adjustment therefor; 
  
 (b) to reimburse the Master Servicer for unreimbursed Delinquency Advances
and unreimbursed Servicing Advances with respect to the Mortgage Loans for which it has made a Delinquency Advance or Servicing Advance, from late or deferred payments collected, collections other than timely Monthly Payments, Liquidation Proceeds,
Insurance Proceeds and/or the Loan Repurchase Price or Substitution Adjustment of or relating to such Mortgage Loans; 
  
 (c) to reimburse the Master Servicer for any Delinquency Advances and Servicing Advances determined in good faith to have become Nonrecoverable Advances,
such reimbursement to be made from any funds in the Collection Account; 
  
 (d) to withdraw any amount received from a Mortgagor that is recoverable and sought to be recovered as a voidable preference by a trustee in bankruptcy pursuant to the Bankruptcy Code in accordance with a final, nonappealable order of a
court having competent jurisdiction; 
  
 (e) to withdraw any funds
deposited in the Collection Account that were not required to be deposited therein; 
  
 (f) to pay the Master Servicer the Servicing Compensation pursuant to Section 5.08 hereof to the extent not retained or paid; 
  
 (g) to pay the Backup Servicer the Backup Servicing Fee pursuant to Section 5.08 hereof to the extent payments in respect of these amounts have not been
previously retained or paid; 
  
 (h) without duplication, and
solely out of amounts which are payable to a former master servicer pursuant to Section 7.02(g), to pay to the Backup Servicer, the Indenture Trustee or any successor master servicer amounts paid by them in connection with the transfer of the Master
Servicer’s servicing obligations pursuant to Article VII hereof and required under such Article VII to be borne by the Master Servicer; 
  

 30 

 (i) to withdraw income on the Collection Account as provided in Section 5.02(d); and 
  
 (j) amounts deposited into the Collection Account in respect of late fees,
assumption fees and similar fees (other than Prepayment Charges). 
  
 The Master Servicer shall keep and maintain a separate accounting for each Mortgage Loan for the purpose of accounting for withdrawals from the Collection Account pursuant to this Section 5.03. Furthermore, in the event that servicing has
been transferred to the Backup Servicer, all reimbursements in respect of Servicer Advances and Delinquency Advances shall be made on a first in, first out priority basis (i.e. the longest outstanding reimbursable Servicer Advance or Delinquency
Advance will be reimbursed first). 
  
 Section 5.04. Hazard
Insurance Policies; Property Protection Expenses. (a) The Master Servicer shall cause to be maintained with respect to each Mortgage Loan a hazard insurance policy with a carrier licensed in the state in which the Mortgaged Property is located
that provides for fire and extended coverage, and which provides for a recovery by the named insured of insurance proceeds relating to such Mortgage Loan in an amount not less than the least of (i) the outstanding Principal Balance of the Mortgage
Loan plus the outstanding principal balance of any mortgage loan senior to such Mortgage Loan, but in no event shall such amount be less than is necessary to prevent the Mortgagor from becoming a coinsurer thereunder, (ii) the minimum amount
required to compensate for loss or damage on a replacement cost basis and (iii) the full insurable value of the related Mortgage Property. The Master Servicer shall also maintain on property acquired upon foreclosure, or by deed in lieu of
foreclosure, hazard insurance with extended coverage in an amount which is at least equal to the lesser of (i) the maximum insurable value from time to time of the improvements which are a part of such property or (ii) the sum of the Principal
Balance of such Mortgage Loan and the principal balance of any mortgage loan senior to such Mortgage Loan at the time of such foreclosure plus accrued interest and the good-faith estimate of the Master Servicer of related Liquidation Expenses to be
incurred in connection therewith. Amounts collected by the Master Servicer under any such policies shall be deposited in the Collection Account to the extent that they constitute Liquidation Proceeds or Insurance Proceeds. Each hazard insurance
policy shall contain a standard mortgage clause naming the Master Servicer, its successors and assigns, as mortgagee. The Master Servicer shall be under no obligation to require that any Mortgagor maintain earthquake (except as provided herein) or
other additional insurance and shall be under no obligation itself to maintain any such additional insurance 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. 
  
 (b) In
the event that the Master Servicer shall obtain and maintain a blanket policy with an insurer either (i) which satisfies the corresponding requirements of Fannie Mae or Freddie Mac or (ii) approved in writing by the Note Insurer, such approval not
to be unreasonably withheld, insuring against fire, flood and hazards of extended coverage on all of the Mortgage Loans, then, to the extent such policy names the Master Servicer as loss payee and 
  

 31 

 provides coverage in an amount equal to the aggregate unpaid Principal Balance on the Mortgage Loans without
co-insurance, and otherwise complies with the requirements of this Section 5.04, the Master Servicer shall be deemed conclusively to have satisfied its obligations with respect to fire and hazard insurance coverage under this Section 5.04, it being
understood and agreed that such blanket policy may contain a deductible clause (payable by the Master Servicer), 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 preceding paragraph of this Section 5.04, and there shall have been a loss which would have been covered by such policy, deposit in the Collection Account from the Master Servicer’s own funds the difference, if any,
between the amount that would have been payable under a policy complying with the preceding paragraph of this Section 5.04 and the amount paid under such blanket policy. Upon the request of the Indenture Trustee or the Note Insurer, the Master
Servicer shall cause to be delivered to the Indenture Trustee or the Note Insurer, a certified true copy of such policy. 
  
 (c) If the Mortgage Loan at the time of origination relates to a Mortgaged Property in an area identified in the Federal Register by the Federal Emergency
Management Agency as having special flood hazards as designated to the Master Servicer by the Sponsor, the Master Servicer will cause to be maintained with respect thereto a flood insurance policy in a form meeting the requirements of the current
guidelines of the Federal Insurance Administration with a generally acceptable carrier in an amount representing coverage, and which provides for a recovery by the Master Servicer on behalf of the Trust of insurance proceeds relating to such
Mortgage Loan of not less than the least of (i) the outstanding Principal Balance of the related Mortgage Loan, plus the principal balance of the related first lien, if any, (ii) the minimum amount required to compensate for damage or loss on a
replacement cost basis and (iii) the maximum amount of insurance that is available under the Flood Disaster Protection Act of 1973. The Master Servicer shall indemnify the Trust and the Note Insurer out of the Master Servicer’s own funds for
any loss to the Trust and the Note Insurer resulting from the Master Servicer’s failure to maintain the insurance required by this Section. 
  
 Section 5.05. Assumption and Modification Agreements. When a Mortgaged Property has been or is about to be conveyed by the Mortgagor, the Master
Servicer shall, to the extent it has knowledge of such conveyance or prospective conveyance, exercise its rights to accelerate the maturity of the related Mortgage Loan under any “due-on-sale” clause contained in the related Mortgage or
Mortgage Note; provided, however, that the Master Servicer shall not exercise any such right if (i) the “due-on-sale” clause, in the reasonable belief of the Master Servicer, is not enforceable under applicable law or (ii)
the Master Servicer reasonably believes that to permit an assumption of the Mortgage Loan would not materially and adversely affect the interest of the Noteholders or of the Note Insurer. In such event, the Master Servicer shall enter into an
assumption and modification agreement with the Person to whom such property has been or is about to be conveyed, pursuant to which such Person becomes liable under the Mortgage Note and, unless prohibited by applicable law or the mortgage documents,
the Mortgagor remains liable thereon. If the foregoing is not permitted under applicable law, the Master Servicer is authorized to enter into a substitution of liability agreement with such Person, pursuant to which the original Mortgagor is
released from liability and such Person is substituted as Mortgagor and becomes liable under the Mortgage Note; provided, however, that to the extent any such substitution of liability agreement would be delivered by the Master
Servicer outside of its usual procedures for mortgage loans held in its own portfolio the Master Servicer shall, prior 
  

 32 

 to executing and delivering such agreement, obtain the prior written consent of the Note Insurer. The Mortgage Loan, if
assumed, shall conform in all respects to the requirements and representations and warranties of this Agreement. The Master Servicer shall notify the Indenture Trustee that any applicable assumption or substitution agreement has been completed by
forwarding to the Indenture Trustee the original copy of such assumption or substitution agreement, which copy shall be added by the Indenture Trustee to the related Indenture Trustee’s Mortgage File and which shall, for all purposes, be
considered a part of such Indenture Trustee’s Mortgage File to the same extent as all other documents and instruments constituting a part thereof. The Master Servicer shall be responsible for promptly recording any such assumption or
substitution agreements. In connection with any such assumption or substitution agreement, the required monthly payment on the related Mortgage Loan shall not be changed but shall remain as in effect immediately prior to the assumption or
substitution, the stated maturity or outstanding Principal Balance of such Mortgage Loan shall not be changed, the Mortgage Interest Rate shall not be changed nor shall any required monthly payments of principal or interest be deferred or forgiven.
Any fee collected by the Master Servicer for consenting to any such conveyance or entering into an assumption or substitution agreement shall be retained by or paid to the Master Servicer as additional servicing compensation. 
  
 Notwithstanding the foregoing paragraph or any other provision of this
Agreement, the Master Servicer shall not be deemed to be in default, breach or any other violation of its obligations hereunder by reason of any assumption of a Mortgage Loan by operation of law or any assumption which the Master Servicer may be
restricted by law from preventing, for any reason whatsoever. 
  
 Section 5.06. Realization Upon Defaulted Mortgage Loans. (a) The Master Servicer shall foreclose upon or otherwise comparably effect the ownership on behalf of the Trust of Mortgaged Properties relating to defaulted Mortgage Loans as
to which no satisfactory arrangements can be made for collection of Delinquent payments and which the Sponsor has not purchased pursuant to Section 5.15, unless the Master Servicer reasonably believes that Net Liquidation Proceeds with respect to
such Mortgage Loan would not be increased as a result of such foreclosure or other action, in which case, such Mortgage Loan will be charged-off and will become a Liquidated Mortgage Loan. The Master Servicer shall have no obligation to purchase any
Mortgaged Property at any foreclosure sale. In connection with such foreclosure or other conversion, the Master Servicer shall exercise foreclosure procedures with the same degree of care and skill in their exercise or use, as it would ordinarily
exercise or use under the circumstances in the conduct of their own affairs. Any amounts including Liquidation Expenses, advanced by the Master Servicer in connection with such foreclosure or other action shall constitute Servicing Advances.

  
 Pursuant to its efforts to sell any REO Property, the Master
Servicer either itself or through an agent selected by the Master Servicer shall manage, conserve, protect and operate such REO Property in the same manner and to such extent as is customary in the locality where such REO Property is located and
may, incident to its conservation and protection of the interests of the Master Servicer, rent the same, or any part thereof, as the Master Servicer deems to be in the best interest of the Trust and Note Insurer for the period prior to the sale of
such REO Property. The net income generated from the REO Property and the proceeds from a sale of any REO Property shall be deposited in the Collection Account. 
  

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 (b) If the Master Servicer has reason to believe that a Mortgaged Property which the Master Servicer is
contemplating acquiring in foreclosure or by deed in lieu of foreclosure contains environmental or hazardous waste risks known to the Master Servicer, the Master Servicer shall notify the Backup Servicer, the Indenture Trustee and the Note Insurer
and obtain the consent of the Note Insurer prior to acquiring the Mortgaged Property. The Master Servicer shall not institute foreclosure actions with respect to such a property if it reasonably believes that such action would not be consistent with
the Accepted Servicing Practices, and in no event shall the Master Servicer be required to manage, operate or take any other action with respect thereto which the Master Servicer in good faith believes will result in “clean-up” or other
liability under applicable law, unless the Master Servicer receives an indemnity acceptable to it in its sole discretion. 
  
 (c) The Master Servicer shall determine, with respect to each defaulted Mortgage Loan, when it has recovered, whether through trustee’s sale,
foreclosure sale or otherwise, all amounts if any it expects to recover from or on account of such defaulted Mortgage Loan, whereupon such Mortgage Loan shall become a Liquidated Mortgage Loan. 
  
 (d) Net Foreclosure Profits, if any, shall be paid directly to the Sponsor.

  
 (e) With respect to its obligations under this Section 5.06,
the Master Servicer shall take all such actions as it reasonably believes are consistent with Accepted Servicing Practices. 
  
 Section 5.07. Indenture Trustee to Cooperate. (a) Upon the payment in full of any Mortgage Loan or 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 deliver to the Indenture Trustee one copy of a Request for Release. Upon receipt of such copy of the Request for Release, the
Indenture Trustee shall promptly release the related Indenture Trustee’s Mortgage File, in trust to (i) the Master Servicer (ii) an escrow agent or (iii) any employee, agent or attorney of the Indenture Trustee, in each case pending its release
by the Master Servicer, such escrow agent or such employee, agent or attorney of the Indenture Trustee, as the case may be. Upon any such payment in full, or the receipt of such notification that such funds have been placed in escrow, the Master
Servicer is authorized to give, as attorney-in-fact for the Indenture Trustee and the mortgagee under the Mortgage which secured the Mortgage Note, an instrument of satisfaction (or assignment of Mortgage without recourse) regarding the Mortgaged
Property relating to such Mortgage, which instrument of satisfaction or assignment, as the case may be, shall be delivered to the Person or Persons entitled thereto against receipt therefor of payment in full, it being understood and agreed that no
expense incurred in connection with such instrument of satisfaction or assignment, as the case may be, shall be chargeable to the Collection Account. 
  
 (b) (i) From time to time and as appropriate in the servicing of any Mortgage Loan, including, without limitation, foreclosure or other comparable
conversion of a Mortgage Loan or collection under any applicable Insurance Policy, the Indenture Trustee shall (except in the case of the payment or liquidation pursuant to which the related Indenture Trustee’s Mortgage File is released to an
escrow agent or an employee, agent or attorney of the Indenture Trustee), upon request of the Master Servicer and delivery to the Indenture Trustee of one copy of a Request for Release, release the related Indenture Trustee’s Mortgage File to
the Master 
  

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 Servicer and shall execute such documents as shall be necessary to the prosecution of any such proceedings, including,
without limitation, an assignment without recourse of the related Mortgage to the Master Servicer. The Indenture Trustee shall complete in the name of the Indenture Trustee any endorsement in blank on any Mortgage Note prior to releasing such
Mortgage Note to the Master Servicer. Such receipt shall obligate the Master Servicer to return the Indenture Trustee’s Mortgage File to the Indenture Trustee when the need therefor by the Master Servicer no longer exists unless the Mortgage
Loan shall be liquidated, in which case, the Master Servicer shall deliver one copy of a Request for Release indicating such loan has been paid in full. 
  
 (ii) Each Request for Release may be delivered to the Indenture Trustee (x) via mail or courier, (y) via facsimile or (z) by such other
means, including, without limitation, electronic or computer readable medium, as the Master Servicer and the Indenture Trustee shall mutually agree. The Indenture Trustee shall promptly release the related Indenture Trustee’s Mortgage File(s)
within three (3) Business Days of receipt of one copy of a properly completed Request for Release pursuant to clauses (x), (y) or (z) above or such shorter period as may be agreed upon by the Master Servicer and the Indenture Trustee. Receipt of a
Request for Release pursuant to clauses (x), (y) or (z) above shall be authorization to the Indenture Trustee to release such Indenture Trustee’s Mortgage Files, provided the Indenture Trustee has determined that such Request for Release has
been executed, with respect to clauses (x) or (y) above, or approved, with respect to clause (z) above, by a Servicing Officer of the Master Servicer. If the Indenture Trustee is unable to release the Indenture Trustee’s Mortgage Files within
the time frames previously specified, the Indenture Trustee shall immediately notify the Master Servicer, indicating the reason for such delay, but in no event shall such notification be later than five Business Days after receipt of a Request for
Release. If the Master Servicer, is required to pay penalties or damages due solely to the Indenture Trustee’s negligent failure to release the related Indenture Trustee’s Mortgage File or the Indenture Trustee’s negligent failure to
execute and release documents in a timely manner, the Indenture Trustee shall be liable for such penalties or damages. 
  
 (c) No costs associated with the procedures described in this Section 5.07 shall be an expense of the Trust. 
  
 Section 5.08. Servicing Compensation; Payment of Certain Expenses by
Master Servicer. The Master Servicer shall be entitled to receive and retain, out of collections on the Mortgage Loans for each Due Period, as servicing compensation for such Due Period, an amount (the “Servicing Fee”) equal to
the product of one-twelfth of the Servicing Fee Rate and the aggregate Stated Principal Balance of the Mortgage Loans in each Loan Group as of the beginning of such Due Period. Additional servicing compensation in the form of assumption fees, late
payment charges or extension and other administrative charges (other than Prepayment Charges) shall be retained by the Master Servicer. The Master Servicer shall be required to pay all expenses incurred by it in connection with its activities
hereunder (including payment of the Indenture Trustee Fee to the extent that monies in the Collection Account are insufficient therefor, as provided in Section 6.16 of the Indenture, and all other fees and expenses not expressly stated hereunder to
be payable by or from another source) and shall not be entitled to reimbursement therefor except as specifically provided herein. 
  

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 The Backup Servicer shall be entitled to receive, and the Master Servicer shall pay, out of collections
on the Mortgage Loans for each Due Period, as servicing compensation for such Due Period, an amount (the “Backup Servicing Fee”) equal to the product of one-twelfth of the Backup Servicing Fee Rate and the aggregate Stated Principal
Balance of the Mortgage Loans in each Loan Group as of the beginning of such Due Period. The Backup Servicer will also be entitled to an upfront fee of $7,500.00. 
  
 Section 5.09. Annual Statement as to Compliance. The Master Servicer will deliver to the Backup Servicer, the Trust,
the Indenture Trustee, the Rating Agencies, the Note Insurer and, the Sponsor on or before March 15 of each year, beginning March 15, 2005, an Officer’s Certificate of the Master Servicer stating that (a) a review of the activities of the
Master Servicer during the preceding calendar year and of its performance under this Agreement has been made under such officer’s supervision and (b) to the best of such officer’s knowledge, based on such review, the Master Servicer has
fulfilled all its material obligations under this Agreement throughout such year, or, if there has been a default in the fulfillment of any such obligation, specifying each such default known to such officer and the nature and status thereof.

  
 Section 5.10. Annual Independent Public Accountants’
Servicing Report. On or before March 15 of each year, beginning March 15, 2005, the Master Servicer at its expense shall cause a firm of independent public accountants that is a member of the American Institute of Certified Public Accountants
(who may also render other services to the Master Servicer) to furnish a report to the Backup Servicer, the Trust, the Indenture Trustee, the Rating Agencies, the Note Insurer and the Sponsor to the effect that such firm has examined certain
documents and records relating to the servicing of mortgage loans under servicing agreements (including this Agreement) substantially similar to this Agreement, and that such examination, which has been conducted substantially in compliance with the
Uniform Single Attestation Program for Mortgage Bankers or the Audit Guide for Audits of HUD Approved Nonsupervised Mortgagees (to the extent that the procedures in such audit guide are applicable to the servicing obligations set forth in such
agreements), has disclosed no items of noncompliance with the provisions of this Agreement which, in the opinion of such firm, are material, except for such items of noncompliance as shall be set forth in such report. 
  
 Section 5.11. Access to Certain Documentation. The Master Servicer
shall provide to the Backup Servicer, the Indenture Trustee, the Note Insurer, the FDIC and the supervisory agents and examiners (as required in the latter case by applicable State and federal regulations) of each of the foregoing access to the
documentation regarding the Mortgage Loans, such access being afforded without charge but only upon reasonable request and during normal business hours at the offices of the Master Servicer designated by it. 
  
 Upon any change in the format of the computer tape maintained by the Master
Servicer in respect of the Mortgage Loans, the Master Servicer shall deliver a copy of such computer tape to the Indenture Trustee and the Backup Servicer and in addition shall provide a copy of such computer tape to the Indenture Trustee, the
Backup Servicer and the Note Insurer at such other times as the Indenture Trustee or the Note Insurer may reasonably request. 
  
 The Master Servicer shall keep confidential (including from affiliates thereof) information concerning the Mortgage Loans, except as required by law.

  

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 Section 5.12. Maintenance of Fidelity Bond. The Master Servicer and the Backup Servicer shall
each, during the term of its service as Master Servicer and Backup Servicer, respectively, maintain in force a fidelity bond and errors and omissions insurance in respect of their respective officers, employees or agents. Such bond and insurance
shall comply with the requirements from time to time of Fannie Mae for Persons performing servicing for mortgage loans purchased by such association. 
  
 Section 5.13. Subservicing Agreements Between the Master Servicer and Subservicer and Subservicers. (a) The Master Servicer may enter into
subservicing agreements for any servicing and administration of Mortgage Loans with any institution which is in compliance with the laws of each state necessary to enable it to perform its obligations under such subservicing agreement. The Master
Servicer shall give notice to the Backup Servicer, the Note Insurer and the Indenture Trustee of the appointment of any subservicer and shall furnish to the Backup Servicer, the Note Insurer and the Indenture Trustee a copy of the subservicing
agreement. The Master Servicer shall give notice to each Rating Agency of the appointment of any subservicer. No such appointment of a subservicer shall be effective without the consent of the Note Insurer. For purposes of this Agreement, the Master
Servicer shall be deemed to have received payments on Mortgage Loans when any subservicer has received such payments. Any such subservicing agreement shall be consistent with and not violate the provisions of this Agreement. 
  
 (b) The Master Servicer may, with the consent of the Note Insurer, terminate
any subservicing agreement in accordance with the terms and conditions of such subservicing agreement and thereafter directly service the related Mortgage Loans itself or enter into a subservicing agreement with a successor subservicer that
qualifies under Subsection (a) of this Section 5.13. The Master Servicer shall give notice to each Rating Agency of the termination of any subservicer and the appointment of any successor subservicer. 
  
 (c) The Master Servicer shall not be relieved of its obligations under this
Agreement notwithstanding any subservicing agreement or any of the provisions of this Agreement relating to agreements or arrangements between the Master Servicer and a subservicer or otherwise, and the Master Servicer shall be obligated to the same
extent and under the same terms and conditions as if it 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 by
such subservicer and nothing contained in such subservicing agreement shall be deemed to limit or modify this Agreement. The Trust shall not indemnify the Master Servicer for any losses due to the Master Servicer’s negligence. 
  
 (d) Any subservicing agreement and any other transactions or services
relating to the Mortgage Loans involving a subservicer shall be deemed to be between the subservicer and the Master Servicer alone and the Backup Servicer, the Note Insurer, the Indenture Trustee and the Noteholders shall not be deemed parties
thereto and shall have no claims, rights, obligations, duties or liabilities with respect to any Subservicer except as set forth in Subsection (e) of this Section 5.13 and the related Subservicing Agreement. 
  
 (e) Notwithstanding any contrary provision contained herein, in connection
with the assumption of the responsibilities, duties and liabilities and of the authority, power and rights of the Master Servicer hereunder by the Backup Servicer, the Indenture Trustee or any 
  

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 other successor master servicer pursuant to Section 7.02, it is understood and agreed that the Master Servicer’s
rights and obligations under any subservicing agreement then in force between the Master Servicer and a subservicer may be assumed or terminated (without cost) by the Backup Servicer, the Indenture Trustee or any other successor master servicer at
its option as successor to the Master Servicer. 
  
 The Master
Servicer shall, upon request of the Backup Servicer, the Indenture Trustee or the Note Insurer, but at the expense of the Master Servicer, deliver to the assuming party documents and records relating to each subservicing agreement and an accounting
of amounts collected and held by it and otherwise use its best reasonable efforts to effect the orderly and efficient transfer of the subservicing agreements to the assuming party, without the payment of any fee by the Backup Servicer, the Indenture
Trustee, any Noteholders or the Note Insurer, notwithstanding any contrary provision in any subservicing agreement. 
  
 Section 5.14. Reports to the Indenture Trustee; Collection Account Statements. Not later than twenty-five (25) days after each Payment Date, the
Master Servicer shall provide to the Indenture Trustee, the Backup Servicer and the Note Insurer a statement, certified by a Servicing Officer, setting forth the status of the Collection Account as of the close of business on the last day of the Due
Period preceding such Payment Date, stating that all payments required by this Agreement to be made by the Master Servicer on behalf of the Indenture Trustee have been made (or if any required payment has not been made by the Master Servicer,
specifying the nature and status thereof) and showing, for the period covered by such statement, the aggregate of deposits into and withdrawals from the Collection Account and the aggregate of deposits into each Payment Account as specified in
Section 6.01. Such statement shall also state the aggregate Stated Principal Balance and the aggregate unpaid principal balance of all the Mortgage Loans as of the close of business on the last day of the month preceding the month in which such
Payment Date occurs. 
  
 Section 5.15. Optional Purchase of
Defaulted Mortgage Loans. (a) The Sponsor, in its sole discretion, shall have the right to elect (by written notice sent to the Master Servicer, the Indenture Trustee and the Note Insurer), but shall not be obligated, to purchase for its own
account from the Trust any Mortgage Loan which is ninety (90) days or more Delinquent in the manner at the Loan Repurchase Price (except that the amount described in the definition of Loan Repurchase Price shall in no case be net of the Servicing
Fee and the Backup Servicing Fee). The purchase price for any Mortgage Loan purchased hereunder shall be deposited in the Collection Account and the Indenture Trustee, upon the Indenture Trustee’s receipt of written notice by the Master
Servicer of such deposit, shall release or cause to be released to the purchaser of such Mortgage Loan the related Indenture Trustee’s Mortgage File and shall execute and deliver such instruments of transfer or assignment prepared by the
purchaser of such Mortgage Loan, in each case without recourse, as shall be necessary to vest in the purchaser of such Mortgage Loan any Mortgage Loan released pursuant hereto and the purchaser of such Mortgage Loan shall succeed to all the
Indenture Trustee’s right, title and interest in and to such Mortgage Loan and all security and documents related thereto. Such assignment shall be an assignment outright and not for security. The purchaser of such Mortgage Loan shall thereupon
own such Mortgage Loan, and all security and documents, free of any further obligation to the Indenture Trustee, the Note Insurer or the Noteholders with respect thereto. The purchaser of such Mortgage Loan shall give written notice to the Note
Insurer of the means by which any Mortgage Loan purchased pursuant to this Section 5.15 is ultimately disposed of and any other information regarding any such Mortgage Loan reasonably requested by the Note Insurer. 
  

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 (b) After the Sponsor or an Affiliate of the Sponsor has repurchased any Mortgage Loans which are 90 days
or more Delinquent in an aggregate amount equal to 1% of the Maximum Collateral Amount, then notwithstanding the foregoing, unless the Note Insurer consents, the Sponsor or an Affiliate of the Sponsor may only exercise its option pursuant to this
Section 5.15 with respect to the Mortgage Loan or Mortgage Loans (including REO Mortgage Loans) that have been Delinquent for the longest period at the time of such repurchase. Any request by the Sponsor or an Affiliate of the Sponsor to the Note
Insurer for consent to repurchase Mortgage Loans that are not the most Delinquent shall be accompanied by a description of the Mortgage Loans that have been Delinquent longer than the Mortgage Loan or Mortgage Loans the Sponsor or such Affiliate
proposes to repurchase. If the Note Insurer fails to respond to such request within ten (10) Business Days after receipt thereof, the Sponsor or such Affiliate may repurchase the Mortgage Loan or Mortgage Loans proposed to be repurchased without the
consent of, or any further action by, the Note Insurer. Notice to the Note Insurer shall be delivered in accordance with the terms of the Insurance Agreement. 
  

Section 5.16. Reports to be Provided by the Master Servicer and the Backup Servicer. (a) By 3:00 p.m. eastern time on the second Business Day
following the fifteenth (15th) day of each month (the “Servicer Reporting Date”), the Master Servicer shall deliver to the Indenture Trustee, the Backup Servicer, the Underwriter, Intex, Bloomberg and the Note Insurer a Servicer
Remittance Report for the related Servicer Remittance Date setting forth the following information with respect to all Mortgage Loans as well as a break out as to each Loan Group as of the close of business on the last Business Day of the prior
calendar month (except as otherwise provided in clause (v) below): 
  
 (i) the total number of Mortgage Loans and the Aggregate Principal Balances thereof, together with the number, Aggregate Principal Balances of such Mortgage Loans and the percentage (based on the Aggregate Principal
Balances of the Mortgage Loans) of the Aggregate Principal Balances of such Mortgage Loans to the Aggregate Principal Balance of all Mortgage Loans (A) 30-59 days Delinquent, (B) 60-89 days Delinquent and (C) 90 or more days Delinquent; 

 
 (ii) the number, Aggregate Principal Balances of all
Mortgage Loans and percentage (based on the Aggregate Principal Balances of the Mortgage Loans) of the Aggregate Principal Balances of such Mortgage Loans to the Aggregate Principal Balance of all Mortgage Loans in foreclosure proceedings and the
number, Aggregate Principal Balances of all Mortgage Loans and percentage (based on the Aggregate Principal Balances of the Mortgage Loans) of any such Mortgage Loans also included in any of the statistics described in the foregoing clause (i);

  
 (iii) the number, Aggregate Principal
Balances of all Mortgage Loans and percentage (based on the Aggregate Principal Balances of the Mortgage Loans) of the Aggregate Principal Balances of such Mortgage Loans to the Aggregate Principal Balance of all Mortgage Loans relating to
Mortgagors in bankruptcy proceedings and the number, Aggregate Principal Balances of all Mortgage Loans and percentage (based on the Aggregate Principal Balances of the Mortgage Loans) of any such Mortgage Loans also included in any of the
statistics described in the foregoing clause (i); 
  

 39 

 (iv) the number, Aggregate Principal Balances of all Mortgage Loans and percentage (based
on the Aggregate Principal Balances of the Mortgage Loans) of the Aggregate Principal Balances of such Mortgage Loans to the Aggregate Principal Balance of all Mortgage Loans relating to REO Properties and the number, Aggregate Principal Balances of
all Mortgage Loans and percentage (based on the Aggregate Principal Balances of the Mortgage Loans) of any such Mortgage Loans also included in any of the statistics described in the foregoing clause (i); 
  
 (v) the weighted average Mortgage Interest Rate for the
Mortgage Loans in Loan Group 1 and Loan Group 2, in each case, as of the Due Date occurring in the Due Period related to such Payment Date; 
  
 (vi) the weighted average remaining term to stated maturity of all Mortgage Loans; 
  
 (vii) the book value of any REO Property; 
  
 (viii) the Cumulative Loan Loss Percentage as of the related
Payment Date; 
  
 (ix) the number and the
Aggregate Principal Balance of Mortgage Loans repurchased pursuant to Section 5.15; and 
  
 (x) such other loan level information as either (a) the Indenture Trustee may reasonably request to enable it to prepare the Indenture
Trustee’s Remittance Report or (b) the Note Insurer may reasonably request. 
  
 (b) [Reserved]. 
  
 (c) In
addition to the contingent obligations of the Backup Servicer under this Agreement, the Backup Servicer shall establish and maintain a system of transaction accounting in regard to the Mortgage Loans substantially similar to that maintained by the
Master Servicer and post to such system all information relating to the Mortgage Loans obtained by the Backup Servicer pursuant to Section 5.16 and 5.18, to enable the Backup Servicer to perform the obligations of a successor master servicer
immediately upon any termination or resignation of the Master Servicer. The Backup Servicer’s obligations described in this Section 5.16(c) and its obligations pursuant to Section 7.02 shall be the only obligations of the Backup Servicer under
this Agreement. All such obligations of the Backup Servicer are effective as of the date of this Agreement. 
  
 Section 5.17. [Reserved]. 
  
 Section 5.18. Delinquency Advances. If, on any Servicer Remittance Date, the Master Servicer determines that any Monthly Payments due during the
related Due Period have not been received as of the end of the related Due Period, the Master Servicer shall determine the amount 
  

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 of any Delinquency Advance required to be made with respect to the related Payment Date. The Master Servicer shall
deliver, one (1) Business Day after such Servicer Remittance Date, a magnetic tape, diskette (or such other electronic medium used by the Master Servicer for such purpose) to the Backup Servicer indicating the payment status of each Mortgage Loan as
of the date which is two Business Days prior to such Servicer Remittance Date. The Master Servicer shall include in the amount to be deposited in the related Payment Account on such Servicer Remittance Date an amount equal to the Delinquency
Advance, if any, which deposit may be made in whole or in part from funds in the Collection Account being held for future payment or withdrawal on or in connection with Payment Dates in subsequent months, other than any such amounts which are
voluntary Principal Prepayments in full. Any funds being held for future payment to Noteholders and so used shall be replaced by the Master Servicer from its own funds by deposit in the Collection Account on or before the Business Day preceding any
future Servicer Remittance Date to the extent that funds in the Collection Account on such Servicer Remittance Date shall be less than the Servicer Remittance Amount for such Payment Date. 
  
 The Master Servicer shall designate on its records the specific Mortgage
Loans and related installments (or portions thereof) as to which such Delinquency Advance shall be deemed to have been made, such determination being conclusive for purposes of withdrawals from the Collection Account pursuant to Section 5.03 hereof.

  
 Section 5.19. Indemnification; Third Party Claims. The
Master Servicer agrees to indemnify and to hold each of the Trust, the Owner Trustee, the Seller, the Sponsor, the Backup Servicer, the Indenture Trustee, the Note Insurer and each Noteholder harmless against any and all claims, losses, penalties,
fines, forfeitures, legal fees and related costs, judgments, and any other costs, fees and expenses (including attorneys’ fees and expenses) that the Trust, the Owner Trustee, the Seller, the Sponsor, the Backup Servicer, the Indenture Trustee,
the Note Insurer and any Noteholder (or any director, officer, employee or agent of the foregoing) may sustain in any way related to the failure of the Master Servicer to perform its duties and service the Mortgage Loans in compliance with the terms
of this Agreement and the other Basic Documents and in connection with the Indenture as provided in Section 6.16 thereof. Each indemnified party and the Master Servicer shall immediately notify the other indemnified parties if a claim is made by a
third party with respect to this Agreement and the other Basic Documents and the Master Servicer shall assume the defense of any such claim and pay all expenses in connection therewith, including reasonable counsel fees, and promptly pay, discharge
and satisfy any judgment or decree which may be entered against the Trust, the Owner Trustee, the Seller, the Sponsor, the Backup Servicer, the Master Servicer, the Indenture Trustee, the Note Insurer and/or a Noteholder (or any director, officer,
employee or agent of the foregoing) in respect of such claim. The obligations of the Master Servicer under this Section 5.19 arising prior to any resignation or termination of the Master Servicer hereunder shall survive the resignation or
termination of the Master Servicer or the termination of this Agreement or the Indenture. 
  
 Section 5.20. Maintenance of Corporate Existence and Licenses; Merger or Consolidation of the Master Servicer and Backup Servicer. (a) Each of the Master Servicer and the Backup Servicer will keep in full
effect its existence, rights and franchises as a corporation, will obtain and preserve its qualification to do business as a foreign corporation in each jurisdiction necessary to protect the validity and enforceability of this Agreement or any of
the Mortgage Loans and to perform its duties under this Agreement and will otherwise operate its business so as to cause the representations and warranties under Section 3.01 hereof to be true and correct at all times under this Agreement.

  

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 (b) Any corporation into which the Master Servicer or the Backup Servicer may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Master Servicer or the Backup Servicer shall be a party, or any corporation succeeding to all or substantially all of the
business of the Master Servicer or the Backup Servicer, shall be the successor of the Master Servicer or the Backup Servicer, as applicable, hereunder, only with the consent of the Note Insurer but without the execution or filing of any paper or any
further act on the part of any of the parties hereto provided that, in the case of the Master Servicer, such corporation meets the qualifications set forth in Section 7.02(b). The Master Servicer or the Backup Servicer, as applicable, shall send
notice of any such merger or consolidation to the Owner Trustee, the Indenture Trustee, the Note Insurer and the Master Servicer or the Backup Servicer, as applicable. 
  
 Section 5.21. Assignment of Agreement by Master Servicer and Backup Servicer; Master Servicer and Backup Servicer Not to
Resign. Neither the Master Servicer nor the Backup Servicer shall assign this Agreement nor resign from the obligations and duties hereby imposed on it except with the prior consent of the Note Insurer (a copy of which will be provided to the
Indenture Trustee), or upon the determination that the Master Servicer’s or Backup Servicer’s duties hereunder are no longer permissible under applicable law and that such incapacity cannot be cured by the Master Servicer or the Backup
Servicer, as applicable, without incurring, in the reasonable judgment of the Note Insurer, unreasonable expense. Any such determination that the Master Servicer’s or the Backup Servicer’s duties hereunder are no longer permissible under
applicable law permitting the resignation of the Master Servicer or the Backup Servicer, as applicable, shall be evidenced by a written Opinion of Counsel (who may be counsel for the Master Servicer or the Backup Servicer) to such effect delivered
to the Indenture Trustee, the Trust, the Seller, the Sponsor, the Note Insurer and the Backup Servicer or the Master Servicer, as applicable. No such resignation of the Master Servicer shall become effective until the Backup Servicer or a successor
master servicer appointed in accordance with the terms of this Agreement has assumed the Master Servicer’s responsibilities and obligations hereunder in accordance with Section 7.02. The Master Servicer or the Backup Servicer, as applicable,
shall provide the Indenture Trustee, the Rating Agencies and the Note Insurer with 30 days’ prior written notice of its intention to resign pursuant to this Section 5.21. 
  
 Section 5.22. Periodic Filings with the Securities and Exchange Commission Additional Information. 
  
 (a) The Indenture Trustee shall reasonably cooperate with the Master Servicer
in connection with the satisfaction of the reporting requirements under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The Indenture Trustee shall prepare on behalf of the Trust Fund any Forms 8-K and 10-K customary
for similar securities as required by the Exchange Act and the Rules and Regulations of the Securities and Exchange Commission (the “Commission”) thereunder, and shall file (via the Commission’s Electronic Data Gathering and Retrieval
System) such Forms on behalf of the Master Servicer. The Master Servicer hereby grants to the Indenture Trustee a limited power of attorney to execute and file each such Form 8-K but only to the extent no accompanying certification is required to be
filed on behalf of the 
  

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 Master Servicer. Such power of attorney shall continue until the earlier of (i) receipt by the Indenture Trustee from the
Master Servicer of written termination of such power of attorney and (ii) termination of the Trust Fund. The Master Servicer shall execute the Form 10-Ks. The Indenture Trustee shall have no liability with respect to any failure to properly prepare
or file such periodic reports resulting from or relating to the Indenture Trustee’s inability or failure to obtain any information not resulting from its own negligence or willful misconduct. 
  
 (b) Each Form 8-K shall be filed by the Indenture Trustee within 15 days
after each Payment Date, with a copy of the statement to Certificateholders for such Payment Date as an exhibit thereto. Prior to March 30th of each year (or such earlier date as may be required by the Exchange Act and the Rules and Regulations of
the Commission) commencing with 2005, the Indenture Trustee shall file a Form 10-K, in substance as required by applicable law or the Commission’s staff interpretations. Such Form 10-K shall include as exhibits the Master Servicer’s annual
statement of compliance described under Section 5.09 and the accountant’s report described under Section 5.10, in each case to the extent they have been timely delivered to the Indenture Trustee. If they are not so timely delivered, the
Indenture Trustee shall file an amended Form 10-K including such documents as exhibits reasonably promptly after they are delivered to the Indenture Trustee. The Indenture Trustee shall have no liability with respect to any failure to properly
prepare or file such periodic reports resulting from or relating to the Indenture Trustee’s inability or failure to obtain any information not resulting from its own negligence or willful misconduct. The Form 10-K shall also include a
certification in the form attached hereto as Exhibit G (the “Certification”), which shall be signed by the senior officer of the Master Servicer in charge of securitization. The Indenture Trustee shall prepare and deliver each Form
10-K to the Sponsor for execution no later than March 20th of each year. The Master Servicer shall return the executed Form 10-K to the Indenture Trustee for filing no later than March 25th of each year. 
  
 (c) The Master Servicer shall indemnify and hold harmless the Indenture
Trustee and its officers, directors and affiliates from and against any losses, damages, penalties, fines, forfeitures, reasonable and necessary legal fees and related costs, judgments and other costs and expenses arising out of or based upon a
breach of the Master Servicer’s obligations under this Section or the Sponsor’s negligence, bad faith or willful misconduct in connection therewith. 
  

(d) Upon any filing with the Commission, the Indenture Trustee shall promptly deliver to the Master Servicer a copy of any executed report, statement
or information. 
  
 Section 5.23. Administrative Duties.
(a) Duties with Respect to the Basic Documents. The Master Servicer shall perform all its duties and the duties of the Trust under the Basic Documents. In addition, the Master Servicer shall consult with the Owner Trustee as the Master
Servicer deems appropriate regarding the duties of the Trust under the Basic Documents. The Master Servicer shall monitor the performance of the Trust and shall advise the Owner Trustee when action is necessary to comply with the Trust’s duties
under the Basic Documents. The Master Servicer shall prepare for execution by the Trust or shall cause the preparation by other appropriate Persons of all such documents, reports, filings, instruments, certificates and opinions as it shall be the
duty of the Trust to prepare, file or deliver pursuant to the Basic Documents. In furtherance of the foregoing, the Master Servicer shall take all necessary action that is the duty of the Trust to take pursuant to the Basic Documents. 
  

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 (b) Duties with Respect to the Trust. In addition to the duties of the Master Servicer set forth
in this Agreement or any of the Basic Documents, the Master Servicer shall perform such calculations and shall prepare for execution by the Trust or the Owner Trustee or shall cause the preparation by other appropriate Persons of all such documents,
reports, filings, instruments, certificates and opinions as it shall be the duty of the Trust or the Owner Trustee to prepare, file or deliver pursuant to this Agreement or any of the Basic Documents or under state and federal tax and securities
laws and shall take all appropriate action that it is the duty of the Trust to take pursuant to this Agreement or any of the Basic Documents. In accordance with the directions of the Trust or the Owner Trustee, the Master Servicer shall administer,
perform, or supervise the performance of such other activities in connection with the Basic Documents as are not covered by any of the foregoing provisions and as are expressly requested by the Trust or the Owner Trustee and are reasonably within
the capability of the Master Servicer. 
  
 In carrying out the
foregoing duties under this Agreement, the Master Servicer may enter into transactions with or otherwise deal with any of its Affiliates; provided, however, that the terms of any such transactions or dealings shall be in accordance with any
directions received from the Trust and shall be, in the Master Servicer’s opinion, no less favorable to the Trust in any material respect. 
  
 (c) Additional Information to be Furnished to the Issuer. The Master Servicer shall furnish to the Owner Trustee from time to time such additional
information regarding the Trust or the Basic Documents as the Owner Trustee shall reasonably request. The Master Servicer shall prepare, execute and deliver all certificates or other documents required to be delivered by the Issuer pursuant to the
Sarbanes-Oxley Act of 2002 or the rules and regulations promulgated thereunder. 
  
 ARTICLE VI 
  
 APPLICATION OF FUNDS 
  
 Section 6.01. Deposits
to the Payment Account. By 12:00 noon (Eastern Time) on each Servicer Remittance Date, the Master Servicer shall cause to be deposited in the related Payment Account, from funds on deposit in the Collection Account, an amount equal to the
Servicer Remittance Amount with respect to the related Payment Date, minus any portion thereof payable to the Master Servicer or the Backup Servicer pursuant to Section 5.03. 
  
 Section 6.02. Collection of Money. Except as otherwise expressly provided herein, the Indenture Trustee may demand
payment or delivery of all money and other property payable to or receivable by the Indenture Trustee pursuant to this Agreement, including (a) all payments due on the Mortgage Loans in accordance with the respective terms and conditions of such
Mortgage Loans and required to be paid over to the Indenture Trustee by the Master Servicer and (b) Insured Amounts. The Indenture Trustee shall hold all such money and property received by it, as part of the Trust Estate and shall apply it as
provided in the Indenture. 
  

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 Section 6.03. Application of Principal and Interest. In the event that Net Liquidation Proceeds on
a Liquidated Mortgage Loan are less than the Principal Balance of the related Mortgage Loan plus accrued interest thereon, or any Mortgagor makes a partial payment of any Monthly Payment due on a Mortgage Loan, such Net Liquidation Proceeds or
partial payment shall be applied to payment of the related Mortgage Note as provided therein, and if not so provided, first to interest accrued at the Mortgage Interest Rate and then to principal. 
  
 Section 6.04. [Reserved]. 
  
 Section 6.05. Compensating Interest. Not later than the Servicer
Remittance Date, the Master Servicer shall remit to the Indenture Trustee (without right to reimbursement therefor) for deposit into the related Payment Account, an amount equal to, for all of the Mortgage Loans, the lesser of (a) the Prepayment
Interest Shortfalls for all of the Mortgage Loans for the related Payment Date resulting from Principal Prepayments in full during the related Prepayment Period and (b) its aggregate Servicing Fee with respect to all of the Mortgage Loans for the
related Due Period (the “Compensating Interest”). 
  
 Section 6.06. Effect of Payments by the Note Insurer; Subrogation. Anything herein to the contrary notwithstanding, any payment with respect to principal of or interest on the Notes which is made with moneys received pursuant to the
terms of the Note Insurance Policy shall not be considered payment of the Notes from the Trust Estate. The Seller, the Sponsor, the Master Servicer, the Trust and the Indenture Trustee acknowledge and agree, that without the need for any further
action on the part of the Note Insurer, the Seller, the Sponsor, the Master Servicer, the Trust, the Indenture Trustee or the Note Registrar (a) to the extent the Note Insurer makes payments, directly or indirectly, on account of principal of or
interest on the Notes to the Holders of such Notes, the Note Insurer will be fully subrogated to, and each Noteholder, the Master Servicer, the Seller, the Sponsor, the Trust and the Indenture Trustee hereby delegate and assign to the Note Insurer,
to the fullest extent permitted by law, the rights of such Holders to receive such principal and interest from the Trust Estate, including, without limitation, any amounts due to the Noteholders in respect of securities law violations arising from
the offer and sale of the Notes, and (b) the Note Insurer shall be paid such amounts from the sources and in the manner provided herein for the payment of such amounts and as provided in the Insurance Agreement. The Indenture Trustee and the Master
Servicer shall cooperate in all respects with any reasonable request by the Note Insurer for action to preserve or enforce the Note Insurer’s rights or interests under this Agreement without limiting the rights or affecting the interests of the
Holders as otherwise set forth herein. 
  
 ARTICLE VII

  
 SERVICER DEFAULT 
  
 Section 7.01. Servicer Events of Default. (a) I. The following events
shall each constitute a “Servicer Event of Default” hereunder: 
  
 (i) any failure by the Master Servicer to remit to the Indenture Trustee any payment required to be made by the Master Servicer under the terms of this Agreement (other than Servicing Advances covered by clause (ii)
below and Delinquency 
  

 45 

 Advances, which shall have no cure period), which continues unremedied for one (1) Business Day after the
date upon which notice of such failure, requiring the same to be remedied, shall have been given to the Master Servicer by the Indenture Trustee or to the Master Servicer and Indenture Trustee by the Note Insurer or Noteholders affected thereby
evidencing Percentage Interests of at least 25%; 
  
 (ii) the failure by the Master Servicer to make any required Servicing Advance, which failure continues unremedied for a period of thirty (30) days 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 Indenture Trustee or to the Master Servicer and the Indenture Trustee by the Note Insurer or Noteholders affected thereby evidencing Percentage Interests of at least 25%; 
  
 (iii) any failure on the part of the Master Servicer duly to
observe or perform in any material respect any other of the covenants or agreements on the part of the Master Servicer contained in this Agreement, or the failure of any representation and warranty made pursuant to Section 3.01(a) hereof to be true
and correct which continues unremedied for a period of thirty (30) days 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 Indenture Trustee or to the Master
Servicer and the Indenture Trustee by the Note Insurer or Noteholders affected thereby evidencing Percentage Interests of at least 25%; 
  
 (iv) a decree or order of a court or agency or supervisory authority having jurisdiction in an involuntary case under any present or
future federal or state bankruptcy, insolvency or similar law or for the appointment of a conservator or receiver or liquidation 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 ninety (90) days; 
  
 (v) 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 Master
Servicer’s property; 
  
 (vi) the Master
Servicer shall admit in writing its inability generally to pay its debts as they become due, file a petition to take advantage of any applicable insolvency or reorganization statute, make an assignment for the benefit of its creditors, or
voluntarily suspend payment of its obligations; 
  
 (vii) the Note Insurer shall notify the Indenture Trustee of any “event of default” under the Insurance Agreement; 
  
 (viii) if on any Payment Date the Rolling Six Month Delinquency Rate exceeds 14.0%; 
  

 46 

 (ix) if on any Payment Date, the Cumulative Loan Loss Percentage exceeds the following
percentages on any Payment Date during the following periods: 
  

				
	 Payment Date Occurring During

	  	Percentage

	 
	 March 2004 - February 2006
	  	1.70	%
	 March 2006 - February 2007
	  	2.50	%
	 March 2007 - February 2008
	  	3.20	%
	 March 2008 and thereafter
	  	4.50	%

  
 (x) if
the total stockholders’ equity of the Master Servicer, as determined by the Master Servicer’s independent accountants in accordance with generally accepted accounting principles, shall be less than $60 million; 
  
 (xi) if the total on- or off-balance sheet financing
available to the Master Servicer shall be less than $400 million; or 
  
 (xii) the occurrence of an Event of Default under the Indenture. 
  
 II. The following events shall each constitute a “Backup Servicer Event of Default” hereunder: 
  
 (i) any failure on the part of the Backup Servicer duly to
observe or perform in any material respect any other of the covenants or agreements on the part of the Backup Servicer contained in this Agreement, or the failure of any representation and warranty made pursuant to Section 3.03(a) hereof to be true
and correct which continues unremedied for a period of thirty (30) days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Backup Servicer by the Indenture Trustee or to the Backup
Servicer and the Indenture Trustee by the Note Insurer or Noteholders affected thereby evidencing Percentage Interests of at least 25%; 
  
 (ii) a decree or order of a court or agency or supervisory authority having jurisdiction in an involuntary case under any present or
future federal or state bankruptcy, insolvency or similar law or for the appointment of a conservator or receiver or liquidation 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 Backup Servicer and such decree or order shall have remained in force, undischarged or unstayed for a period of ninety (90) days; 
  
 (iii) the Backup 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 Backup Servicer or of or relating to all or substantially all of the Backup
Servicer’s property; and 
  
 (iv) the Backup
Servicer shall admit in writing its inability generally to pay its debts as they become due, file a petition to take advantage of any applicable insolvency or reorganization statute, make an assignment for the benefit of its creditors, or
voluntarily suspend payment of its obligations. 
  
 So long as a
Servicer Event of Default shall have occurred and not have been remedied: (x) with respect solely to Section 7.01(a)(I)(i), if such payment is in respect of Delinquency Advances or Compensating Interest owing by the Master Servicer and such payment
is not made 
  

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 by 12:00 noon New York time on the second Business Day prior to the applicable Payment Date, the Indenture Trustee, upon
receipt of written notice or discovery by a Responsible Officer of the Indenture Trustee of such failure, shall give immediate telephonic and facsimile notice of such failure to a Servicing Officer of the Master Servicer and the Backup Servicer and
to the Note Insurer, and the Indenture Trustee may, with the consent of the Note Insurer, and shall, at the direction of the Note Insurer, terminate all of the rights and obligations of the Master Servicer under this Agreement, except for the Master
Servicer’s indemnification obligation under Section 5.19, and the Backup Servicer, the Indenture Trustee (if it is the successor master servicer) or a successor master servicer appointed in accordance with Section 7.02, shall immediately make
such Delinquency Advance or payment of Compensating Interest as provided in Section 7.02 and assume, pursuant to Section 7.02 hereof, the duties of a successor master servicer; (y) with respect to that portion of Section 7.01(a)(I)(i) not referred
to in the preceding clause (x) and with respect to clauses (ii), (iii), (iv), (v), (vi) and (xii) of Section 7.01(a)(I) or clauses (i) through (iv) of Section 7.01(a)(II), upon receipt of written notice or actual knowledge by a Responsible Officer
of the Indenture Trustee, the Indenture Trustee shall, but only at the direction of the Note Insurer or the Majority Noteholders, by notice in writing to the Master Servicer, the Backup Servicer and a Responsible Officer of the Indenture Trustee and
subject to the prior written consent of the Note Insurer in the case of any removal at the direction of the Majority Noteholders, and in addition to whatever rights such Noteholders may have at law or equity to damages, including injunctive relief
and specific performance, terminate all the rights and obligations of the Master Servicer or Backup Servicer, as applicable, under this Agreement, except for the Master Servicer’s indemnification obligations under Section 5.19, and in and to
the Mortgage Loans and the proceeds thereof, as Master Servicer; and (z) with respect to clauses (vii)-(xi) of Section 7.01(a)(I), upon receipt of written notice or actual knowledge by a Responsible Officer of the Indenture Trustee, the Indenture
Trustee shall, but only at the direction of the Note Insurer, after notice in writing to the Master Servicer, the Backup Servicer and a Responsible Officer of the Indenture Trustee, terminate all the rights and obligations of the Master Servicer
under this Agreement, except for the Master Servicer’s indemnification obligations under Section 5.19, and in and to the Mortgage Loans and the proceeds thereof, as Master Servicer. Upon 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 Mortgage Loans or otherwise, shall, subject to Section 7.02, pass to and be vested in the Backup Servicer, or another successor master servicer selected
by the Note Insurer, and the Backup Servicer or another successor master servicer is hereby authorized and empowered to execute and deliver, on behalf of the Master Servicer, as attorney-in-fact or otherwise, at the expense of the Master Servicer,
any and all documents and other instruments and do or cause to be done all other acts or things necessary or appropriate to effect the purposes of such notice of termination, including, but not limited to, the transfer and endorsement or assignment
of the Mortgage Loans and related documents. The Master Servicer agrees to cooperate (and to pay any related costs and expenses) with the Indenture Trustee and the Backup Servicer or another successor master servicer in effecting the termination of
the Master Servicer’s responsibilities and rights hereunder, including, without limitation, the transfer to the Backup Servicer or another successor master servicer, for administration by it of all amounts which shall at the time be credited by
the Master Servicer to the Collection Account or thereafter received with respect to the Mortgage Loans. The Indenture Trustee shall promptly notify the Note Insurer and the Rating Agencies of the occurrence of a Servicer Event of Default upon
discovery or receipt of notice by a Responsible 
  

 48 

 Officer of the Indenture Trustee; provided, however, the Indenture Trustee shall not be obligated to monitor the Master
Servicer’s compliance with the terms hereof or to determine the occurrence of any Servicer Event of Default. 
  
 Section 7.02. Backup Servicer to Act: Appointment of Successor. (a) (i) On and after the time the Master Servicer receives a notice of termination
pursuant to Section 7.01, or the Indenture Trustee receives the resignation of the Master Servicer evidenced by an Opinion of Counsel pursuant to Section 5.21, or the Master Servicer is removed as Master Servicer pursuant to this Article VII, in
which event the Indenture Trustee shall promptly notify the Rating Agencies, and except as otherwise provided in this Section 7.02, the Backup Servicer (provided the Backup Servicer receives 20 days’ prior written notice) or another successor
master servicer selected by the Note Insurer shall be the successor in all respects to the Master Servicer in its capacity as master servicer under this Agreement and the transactions set forth or provided for in this Agreement, and shall be subject
to all the responsibilities, restrictions, duties, liabilities and termination provisions relating thereto placed on the Master Servicer by the terms and provisions of this Agreement. The Backup Servicer or another successor master servicer and the
Indenture Trustee shall take such action, consistent with this Agreement, as shall be necessary to effect any such succession. If the Backup Servicer or any other successor master servicer is acting as Master Servicer hereunder, it shall be subject
to termination under Section 7.01 upon the occurrence or continuation of a Servicer Event of Default applicable to it as Master Servicer. The Backup Servicer hereby agrees to act as successor master servicer pursuant to the terms of this Agreement
upon the termination or resignation of the Master Servicer as provided in this Section 7.02, provided that the Backup Servicer receives all of the necessary documents relating to the Mortgage Loans and computer records reflecting the status of the
Mortgage Loans as of the date of such transfer of servicing. The Backup Servicer will not be obligated to incur any expenses or costs (including, without limitation, legal fees and the preparation and recording of all intervening assignments of
mortgage) in connection with the transfer of servicing of the Mortgage Loans to the Backup Servicer, or to compel the performance of any obligations by any party to this Agreement. Any successor master servicer and the Backup Servicer prior to its
becoming the successor master servicer shall not be liable for any actions, omissions or defaults of any master servicer prior to it or breaches of representations and warranties of the master servicer prior to it. The Backup Servicer or any other
successor master servicer, as successor master servicer, shall be obligated to pay Compensating Interest pursuant to Section 6.05 in any event and to make Delinquency Advances pursuant to Section 5.18 unless, and only to the extent the Backup
Servicer determines reasonably and in good faith that such advances would not be recoverable from the proceeds of the related Mortgage Loan pursuant to Section 5.03, such determination to be evidenced by a certification of a Responsible Officer of
the Backup Servicer delivered to the Note Insurer. Furthermore, the Backup Servicer shall not be obligated to fund any resulting discrepancy or shortfall in the Collection Account. Upon the transfer of the servicing of the Mortgage Loans, the
Indenture Trustee shall provide the Backup Servicer with an officer’s certificate that contains: (i) a complete description of all material breaches by the Master Servicer under the Agreement known by the Indenture Trustee which have not been
fully cured and (ii) confirmation that all reports required to be filed with the Indenture Trustee have been timely filed by the Master Servicer. 
  
 (ii) In the event that the Backup Servicer is terminated or resigns pursuant to this Agreement or otherwise becomes unable to perform its
obligations under 
  

 49 

 this Agreement, the Note Insurer may (or if the Note Insurer fails to do so promptly the Indenture
Trustee will) appoint a successor backup servicer in accordance with the provisions of this Section 7.02; provided, that any successor backup servicer, shall satisfy the requirements set forth in Section 7.02(b) and shall be approved by the Rating
Agencies and the Note Insurer. 
  
 (b) Any successor master
servicer or successor backup servicer hereunder (other than the Indenture Trustee) shall be a housing and home finance institution, bank or mortgage servicing institution which has been designated as an approved seller-servicer by Fannie Mae or
Freddie Mac, having equity of not less than $5,000,000 as determined in accordance with GAAP, as the successor to the Master Servicer or the Backup Servicer hereunder in the assumption of all or any part of the responsibilities, duties or
liabilities of the Master Servicer or the Backup Servicer, as applicable, hereunder. 
  
 (c) In the event the Backup Servicer is the successor master servicer, it shall be entitled to the same Servicing Compensation (including the Servicing Fee as adjusted pursuant to the definition thereof) and other
funds pursuant to Section 5.08 hereof as the Master Servicer if the Master Servicer had continued to act as master servicer hereunder, and shall continue to be entitled to the Backup Servicing Fee. 
  
 (d) The Indenture Trustee, the Backup Servicer and any successor master
servicer or backup servicer shall take such action, consistent with this Agreement, as shall be necessary to effectuate any such succession. The Master Servicer agrees to cooperate with the Indenture Trustee, the Backup Servicer and any successor
master servicer in effecting the termination of the Master Servicer’s servicing responsibilities and rights hereunder and shall promptly provide the Indenture Trustee, the Backup Servicer or such successor master servicer, as applicable, at the
Master Servicer’s cost and expense, all documents and records reasonably requested by it to enable it to assume the Master Servicer’s functions hereunder and shall promptly also transfer to the Indenture Trustee, the Backup Servicer or
such successor master servicer, as applicable, all amounts that then have been or should have been deposited in the Collection Account by the Master Servicer or that are thereafter received with respect to the Mortgage Loans, including without
limitation all Liquidation Proceeds and Insurance Proceeds, and payments of insurance deductible amounts by the Master Servicer pursuant to Section 5.04(b) with respect to all insurance claims arising during the Master Servicer’s tenure. Any
collections received by the Master Servicer after such removal or resignation shall be endorsed by it to the Backup Servicer or (if the Backup Servicer is not the successor master servicer) to the Indenture Trustee and remitted directly to the
Backup Servicer or the Indenture Trustee, as applicable (or, at the direction of the Indenture Trustee, to any other successor master servicer). Neither the Backup Servicer, the Indenture Trustee nor any other successor master servicer shall be held
liable by reason of any failure to make, or any delay in making, any payment hereunder or any portion thereof caused by (i) the failure of the Master Servicer to deliver, or any delay in delivering, cash, documents or records to it, or (ii)
restrictions imposed by any regulatory authority having jurisdiction over the Master Servicer hereunder. Notwithstanding anything to the contrary herein, no appointment of a successor master servicer under this Agreement shall be effective until the
Note Insurer shall have consented thereto, and written notice of such proposed appointment shall have been provided by the Indenture Trustee to the Note Insurer and the Backup Servicer. The Indenture Trustee shall not resign as Master Servicer until
a successor 
  

 50 

 master servicer reasonably acceptable to the Note Insurer has been appointed. The Note Insurer shall have the right to
remove the Indenture Trustee as successor Master Servicer under this Section 7.02 without cause, and the Indenture Trustee shall appoint such other successor master servicer as directed by the Note Insurer. 
  
 (e) In the event that the Master Servicer is terminated hereunder and no
Backup Servicer is obligated to act as successor master servicer and no other successor master servicer has been appointed hereunder, the Indenture Trustee may appoint a successor master servicer (which may be an affiliate of the Indenture Trustee)
or petition a court of competent jurisdiction to appoint a successor master servicer. Pending appointment of such a successor master servicer hereunder, the Indenture Trustee shall be the successor master servicer and act in such capacity; provided,
however, that the Indenture Trustee, in its capacity as successor master servicer pending appointment of another successor master servicer, (i) shall be obligated to make Delinquency Advances or Servicing Advances only to the extent that the
Indenture Trustee deems such advances to be recoverable, (ii) shall be obligated to make Compensating Interest payments in respect of any Payment Date only to the extent of any Servicing Fee received by the Indenture Trustee in respect of such
Payment Date, (iii) shall not be obligated to perform any other duties or obligations of the Master Servicer hereunder until the Indenture Trustee has received all master servicing records and files from the predecessor master servicer or backup
servicer and in no event later than 90 days following the termination of the Master Servicer; provided, however, the Indenture Trustee shall use its reasonable efforts to perform the duties and obligations of the Master Servicer prior to the end of
such 90 day period, (iv) shall not be obligated to perform any of the administrative duties specified in Section 5.23 hereof, and (v) shall be entitled to payment of all Servicing Compensation and the Backup Servicing Fee. In connection with any
appointment and assumption of duties of a successor master servicer, the Indenture Trustee may make such arrangements for the compensation of such successor master servicer out of payments on Mortgage Loans as the Note Insurer and such successor
shall agree; provided, however, that such compensation may not be in excess of that permitted the Master Servicer pursuant to Section 5.08, together with other Servicing Compensation and the Backup Servicing Fee. The Master Servicer, the Indenture
Trustee and such successor Master Servicer shall take such action, consistent with this Agreement, as shall be necessary to effectuate any such succession. 
  
 (f) In the event the Backup Servicer, the Indenture Trustee, or any successor master servicer incurs out-of-pocket expenses other than Servicing Advances
or Delinquency Advances in connection with the transfer of master servicing hereunder, which expenses are required to be borne by the Master Servicer hereunder, and such expenses are not promptly reimbursed by the Master Servicer or recoverable out
of amounts reimbursable to the Master Servicer out of the Collection Account, the Indenture Trustee shall make such reimbursement to the applicable party out of funds in each Payment Account on any Payment Date after all Payments to Noteholders on
such Payment Date have been made and the Reserve Payment Amount has been made to the Reserve Account but before any distribution to the Certificateholders. The right of the Indenture Trustee to reimbursement from any Payment Account for any of the
Indenture Trustee’s costs and expenses in connection with the transfer of any master servicing hereunder shall be in addition to any rights of the Indenture Trustee to indemnification and reimbursement under the Indenture. 
  

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 (g) In the event that the Master Servicer is terminated or resigns hereunder, and at such time the Master
Servicer has made unreimbursed Delinquency Advances or Servicing Advances out of its own funds, 
  
 (i) any such Delinquency Advances or Servicing Advances shall be allocated by the successor master servicer in whole or in part to
specific Mortgage Loans which are delinquent at the time of the transfer of master servicing, which allocation shall be based on loan-level accounts of the portion of each Delinquency Advance or Servicing Advance which has been funded by the Master
Servicer from its own funds consistently maintained by the former Master Servicer, or, if no such accounts exist, then in the successor master servicer’s discretion; 
  
 (ii) following the transfer of master servicing, the successor master servicer shall reimburse the former
Master Servicer for such Delinquency Advances and Servicing Advances in accordance with the allocations determined in accordance with clause (i) above only out of the proceeds of the Mortgage Loans to which they relate and otherwise subject to
Section 5.03, or, to the extent the successor master servicer determines any such Delinquency Advance or Servicing Advance to be a Nonrecoverable Advance, out of any funds in the Collection Account. 
  
 (h) In connection with the termination or resignation of the Master Servicer
hereunder, the 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. 
  
 Section 7.03. Waiver of Defaults. The Note Insurer or the Majority Noteholders may, on behalf of all Noteholders, and subject to the consent of the Note Insurer, waive any events permitting removal of the Master Servicer as master
servicer pursuant to this Article VII; provided, however, that the Majority Noteholders may not waive a default in making a required payment on a Note without the consent of the Holder of such Note. Upon any waiver of a past default,
such default shall cease to exist, and any Servicer Event of Default arising therefrom shall be deemed to have been remedied for every purpose of this Agreement. No such waiver shall extend to any subsequent or other default or impair any right
consequent thereto except to the extent expressly so waived. Notice of any such waiver shall be given by the Indenture Trustee to the Rating Agencies and the Note Insurer. 
  
 Section 7.04. Rights of the Note Insurer to Exercise Rights of the Noteholders. By accepting its Note, each
Noteholder agrees that unless a Note Insurer Default exists, the Note Insurer shall be deemed to be the Noteholders for all purposes (other than with respect to the receipt of payment on the Notes) and shall have the right to exercise all rights of
the Noteholders under this Agreement and under the Notes without any further consent of the Noteholders, including, without limitation: 
  
 (a) the right to require the Sponsor to repurchase or substitute Mortgage Loans pursuant to Sections 2.06 and 4.02 hereof to the extent set forth therein;

  

 52 

 (b) the right to give notices of breach or to terminate the rights and obligations of the Master Servicer
as master servicer pursuant to Section 7.01 hereof and to consent to or direct waivers of Master Servicer defaults pursuant to Section 7.03 hereof; 
  
 (c) the right to direct the actions of the Indenture Trustee during the continuance of a Servicer Event of Default pursuant to Sections 7.01 and 7.02
hereof; 
  
 (d) the right to institute proceedings against the
Master Servicer pursuant to Section 7.01 hereof; 
  
 (e) the right
to remove the Indenture Trustee pursuant to Section 6.09 of the Indenture; 
  
 (f) the right to direct foreclosures upon the failure of the Master Servicer to do so in accordance with the provisions of Section 5.06 of this Agreement; and 
  
 (g) any rights or remedies expressly given the Majority Noteholders.

  
 In addition, each Noteholder agrees that, subject to Section
10.02, unless a Note Insurer Default exists, the rights specifically enumerated above may only be exercised by the Noteholders with the prior written consent of the Note Insurer. 
  
 Section 7.05. Indenture Trustee To Act Solely with Consent of the Note Insurer. Unless a Note Insurer Default exists,
the Indenture Trustee shall not, without the Note Insurer’s consent or unless directed by the Note Insurer: 
  
 (a) terminate the rights and obligations of the Master Servicer as master servicer pursuant to Section 7.01 hereof; 
  
 (b) agree to any amendment pursuant to Section 10.03 hereof; or 

 
 (c) undertake any litigation. 
  
 The Note Insurer may, in writing and in its sole discretion renounce all or
any of its rights under Sections 7.04, 7.05 or 7.06 or any requirement for the Note Insurer’s consent for any period of time. 
  
 Section 7.06. Mortgage Loans, Trust Estate and Accounts Held for Benefit of the Note Insurer. (a) The Indenture Trustee shall hold the Trust Estate
and the Indenture Trustee’s Mortgage Files, for the benefit of the Noteholders and the Note Insurer, and all references in this Agreement, the Notes and in any of the other Basic Documents to the benefit of Noteholders shall be deemed to
include the Note Insurer. The Indenture Trustee shall cooperate in all reasonable respects with any reasonable request by the Note Insurer for action to preserve or enforce the Note Insurer’s rights or interests under this Agreement, the Notes
and in any of the Basic Documents unless, as stated in an Opinion of Counsel addressed to the Indenture Trustee and the Note Insurer, such action is adverse to the interests of the Noteholders or diminishes the rights of the Noteholders or imposes
additional burdens or restrictions on the Noteholders. 
  

 53 

 (b) The Master Servicer hereby acknowledges and agrees that it shall service the Mortgage Loans for the
benefit of the Noteholders and for the benefit of the Note Insurer, and all references in this Agreement and in any of the other Basic Documents to the benefit of or actions on behalf of the Noteholders shall be deemed to include the Note Insurer.

  
 Section 7.07. Note Insurer Default. During the
continuation of a Note Insurer Default, rights granted or reserved to the Note Insurer hereunder shall vest instead in the Noteholders; provided, that the Note Insurer shall be entitled to any distributions of reimbursements as set forth in the
Indenture and the Insurance Agreement and the Note Insurer shall retain those rights under Section 10.03 to consent to any amendment of this Agreement. 
  
 At such time as either (i) the outstanding Note Principal Balance of the Notes has been reduced to zero or (ii) the Note Insurance Policy has been
terminated and in either case of (i) or (ii) the Note Insurer has been reimbursed for all amounts owed under the Note Insurance Policy and the Insurance Agreement (and the Note Insurer no longer has any obligation under the Note Insurance Policy,
except for breach thereof by the Note Insurer), then the rights and benefits granted or reserved to the Note Insurer hereunder (including the rights to direct certain actions and receive certain notices) shall terminate and the Certificateholders
shall be entitled to the exercise of such rights and to receive such benefits of the Note Insurer following such termination to the extent that such rights and benefits are applicable to the Certificateholders. 
  
 ARTICLE VIII 
  
 TERMINATION 
  
 Section 8.01. Termination. (a) Subject to Section 8.02, this Agreement
shall terminate upon notice to the Indenture Trustee of either: (i) the disposition of all funds with respect to the last Mortgage Loan and the remittance of all funds due hereunder and the payment of all amounts due and payable to the Note Insurer
and the Indenture Trustee or (ii) mutual consent of the Owner Trustee, on behalf of the Trust, at the direction of all the Certificateholders, the Indenture Trustee, the Master Servicer, the Note Insurer and all Noteholders in writing. 

 
 (b) In addition, subject to Section 8.02, the Sponsor may, at its sole
option, cost and expense, terminate the Trust in accordance with the terms of Section 10.01 of the Indenture. 
  
 (c) If on any date, the Master Servicer determines that there are no outstanding Mortgage Loans and no other funds or assets in the Trust Estate other
than funds in the Payment Accounts, the Master Servicer shall send a final payment notice promptly to the Indenture Trustee, who shall forward notice to each Noteholder in accordance with Section 8.01(d). 
  
 (d) Notice of any termination, specifying the Payment Date upon which the
Trust will terminate and the Noteholders shall surrender their Notes to the Indenture Trustee for final payment and cancellation, shall be given promptly by the Master Servicer to the Indenture 
  

 54 

 Trustee, who shall forward the notice by letter to Noteholders mailed during the month of such final payment before the
Servicer Remittance Date in such month, specifying (i) the Payment Date upon which final payment of the Notes will be made upon presentation and surrender of Notes at the office of the Indenture Trustee therein designated, (ii) the amount of any
such final payment and (iii) that the Record Date otherwise applicable to such Payment Date is not applicable, payments being made only upon presentation and surrender of the Notes at the office of the Indenture Trustee therein specified. The
obligations of the Note Insurer hereunder shall terminate upon the deposit by the Sponsor with the Indenture Trustee of a sum sufficient to purchase all of the Mortgage Loans and REO Properties as set forth in Section 10.01 of the Indenture or when
the Note Principal Balance of the Notes has been reduced to zero. 
  
 (e) In the event that all of the Noteholders do not surrender their Notes for cancellation within six (6) months after the time specified in the above-mentioned written notice, the Indenture Trustee shall give a second written notice to the
remaining Noteholders to surrender their Notes for cancellation and receive the final payment with respect thereto. If within six (6) months after the second notice, all of the Notes shall not have been surrendered for cancellation, the Indenture
Trustee may take appropriate steps, or may appoint an agent to take appropriate steps, to contact the remaining Noteholders concerning surrender of their Notes and the cost thereof shall be paid out of the funds and other assets which remain subject
hereto. If within nine (9) months after the second notice all the Notes shall not have been surrendered for cancellation, the Certificateholders shall be entitled to all unclaimed funds and other assets which remain subject hereto and the Indenture
Trustee upon transfer of such funds shall be discharged of any responsibility for such funds and the Noteholders shall look only to the Certificateholders for payment and not to the Note Insurer. Such funds shall remain uninvested. 
  
 Section 8.02. Additional Termination Requirements. By their acceptance
of the Notes, the Holders thereof hereby agree to appoint the Master Servicer as their attorney in fact to: (i) adopt a plan of complete liquidation (and the Noteholders hereby appoint the Indenture Trustee as their attorney in fact to sign such
plan) as appropriate or upon the written request of the Note Insurer and (ii) to take such other action in connection therewith as may be reasonably required to carry out such plan of complete liquidation all in accordance with the terms hereof.

  
 Section 8.03. Accounting Upon Termination of Master
Servicer. Upon termination of the Master Servicer, the Master Servicer shall, at its expense: 
  
 (a) deliver to the successor master servicer or, if none shall yet have been appointed, to the Indenture Trustee, the funds in any Account administered by
the Master Servicer; 
  
 (b) deliver to the successor master
servicer or, if none shall yet have been appointed, to the Indenture Trustee all Mortgage Files and related documents and statements held by it hereunder and a Mortgage Loan portfolio computer tape (such delivery to take place within 24 hours if the
successor master servicer is the Backup Servicer); 
  
 (c) deliver
to the successor master servicer, or, if none shall yet have been appointed, to the Indenture Trustee a full accounting of all funds, including a statement showing the Monthly Payments collected by it and a statement of monies held in trust by it
for the payments or charges with respect to the Mortgage Loans; and 
  

 55 

 (d) execute and deliver such instruments and perform all acts reasonably requested in order to effect the
orderly and efficient transfer of servicing of the Mortgage Loans to the successor master servicer and to more fully and definitively vest in such successor all rights, powers, duties, responsibilities, obligations and liabilities of the Master
Servicer under this Agreement. 
  
 Section 8.04. Termination of
Backup Servicer as Successor Master Servicer. In the event the Backup Servicer becomes the successor master servicer and is terminated for reasons other than the occurrence of a Servicer Event of Default, then the Backup Servicer will be
entitled to a release fee of $10.00 per Mortgage Loan (subject to a minimum of $5,000.00). 
  
 ARTICLE IX 
  
 [RESERVED] 
  
 ARTICLE X 
  
 MISCELLANEOUS PROVISIONS 
  
 Section 10.01. Limitation on Liability. (a) None of the Trust, the
Owner Trustee, the Seller, the Sponsor, the Master Servicer, the Backup Servicer, the Indenture Trustee or any of the directors, officers, employees or agents of such Persons shall be under any liability to the Trust, the Noteholders or the Note
Insurer 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 Trust, the Owner Trustee,
the Seller, the Sponsor, the Master Servicer, the Backup Servicer, the Indenture Trustee or any such Person against liability for any breach of warranties or representations made herein by such party, or against any specific liability imposed on
each such party pursuant to this Agreement or against any liability which would otherwise be imposed upon such party by reason of willful misfeasance, bad faith or negligence in the performance of duties or by reason of failure to perform its
obligations or duties hereunder. The Trust, the Owner Trustee, the Seller, the Sponsor, the Master Servicer, the Backup Servicer, the Indenture Trustee and any director, officer, employee or agent of such Person may rely in good faith on any
document of any kind which, prima facie, is properly executed and submitted by any appropriate Person respecting any matters arising hereunder. 
  
 (b) It is expressly understood and agreed by the parties hereto that (i) this Agreement is executed and delivered by U.S. Bank Trust National Association,
not individually or personally but solely as Owner Trustee under the Trust Agreement, in the exercise of the powers and authority conferred and vested in it under the Trust Agreement, (ii) each of the representations, undertakings and agreements
herein made on the part of the Trust is made and intended not as personal representations, undertakings and agreements by U.S. Bank Trust National Association but is made and intended for the purpose for binding only the Trust, (iii) nothing herein
contained shall be construed as creating any liability on U.S. Bank Trust National Association, individually or personally, to perform any covenant either expressed or implied 
  

 56 

 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 and (iv) under no circumstances shall U.S. Bank Trust National Association be personally liable for the payment of any indebtedness or expenses of the Trust or be liable for the breach or failure of any
obligation, representation, warranty or covenant made or undertaken by the Trust under this Agreement or any other related documents. 
  
 Section 10.02. Acts of Noteholders. (a) Subject to Section 7.04 and except as otherwise specifically provided herein, whenever Noteholder action,
consent or approval is required under this Agreement, such action, consent or approval shall be deemed to have been taken or given on behalf of, and shall be binding upon, all Noteholders if the Majority Noteholders or the Note Insurer agrees to
take such action or give such consent or approval. 
  
 (b) The
death or incapacity of any Noteholder shall not operate to terminate this Agreement or the Trust, nor entitle such Noteholder’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, nor otherwise affect the rights, obligations and liabilities of the parties hereto or any of them. 
  
 (c) No Noteholder shall have any right to vote (except as expressly provided for herein) or in any manner otherwise control the operation and management
of the Trust, or the obligations of the parties hereto, nor shall anything herein set forth, or contained in the terms of the Notes, be construed so as to constitute the Noteholders from time to time as partners or members of an association; nor
shall any Noteholder 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. 
  

Section 10.03. Amendment. (a) This Agreement may be amended from time to time by the Owner Trustee, on behalf of the Trust, the Master Servicer,
the Seller, Sponsor, the Backup Servicer and the Indenture Trustee by written agreement, upon the prior written consent of the Note Insurer, without notice to or consent of the Noteholders to cure any ambiguity, to correct or supplement any
provisions herein, to comply with any changes in the Code, or to make any other provisions with respect to matters or questions arising under this Agreement which shall not be inconsistent with the provisions of this Agreement; provided,
however, that such action shall not adversely affect in any material respect the interests of any Noteholder and will not prevent the Notes from being characterized as debt for United States federal income tax purposes or cause the Issuer to
be characterized as an association (or a publicly traded partnership) taxable as a corporation or a taxable mortgage pool for United States federal income tax purposes, as evidenced by (i) an Opinion of Counsel, at the expense of the party
requesting the change, delivered to the Indenture Trustee to such effect or (ii) a letter from each Rating Agency confirming that such action will not result in the reduction, qualification or withdrawal of the then-current ratings on the Notes
(without taking into account the Note Insurance Policy). The Indenture Trustee shall give prompt written notice to the Rating Agencies of any amendment made pursuant to this Section 10.03. 
  
 (b) This Agreement may be amended from time to time by the Owner Trustee, on
behalf of the Trust, the Master Servicer, the Seller, the Sponsor, the Backup Servicer and the Indenture Trustee, with the consent of the Note Insurer, the Noteholders representing at least 
  

 57 

 51% of the outstanding Principal Balance of the Notes of each affected Class and all of the Certificateholders;
provided, however, that no such amendment shall reduce in any manner the amount of, or delay the timing of, payments received on Mortgage Loans which are required to be paid on either Class of Notes without the consent of the Holders
of such Class of Notes or reduce the percentage for the Holders of which are required to consent to any such amendment without the consent of the Holders of 100% of such Class of Notes affected thereby. 
  
 (c) It shall not be necessary for the consent of Holders under this Section
10.03 to approve the particular form of any proposed amendment, but it shall be sufficient if such consent shall approve the substance thereof. 
  
 (d) In executing, or accepting the additional trusts created by, any supplemental indenture permitted by Article IX of the Indenture or the modifications
thereby of the trusts created by the Indenture, the Indenture Trustee shall be entitled to receive, and (subject to Section 6.01 of the Indenture) shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such
supplemental indenture is authorized or permitted by the Indenture. The Indenture Trustee may, but shall not be obligated to, enter into any such supplemental indenture that affects the Indenture Trustee’s own rights, duties or immunities under
the Indenture or otherwise. The Master Servicer, on behalf of the Trust, shall cause executed copies of any supplemental indentures to be delivered to the Note Insurer and the Rating Agencies. 
  
 Section 10.04. Recordation of Agreement. To the extent permitted by
applicable law, this Agreement, or a memorandum thereof if permitted under applicable law, is subject to recordation in all appropriate public offices for real property records in all of 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 at the Noteholders’ expense on direction and at the expense
of Majority Noteholders requesting such recordation, but only when accompanied by an Opinion of Counsel to the effect that such recordation materially and beneficially affects the interests of the Noteholders or is necessary for the administration
or servicing of the Mortgage Loans. 
  
 Section 10.05. Duration
of Agreement. This Agreement shall continue in existence and effect until terminated as herein provided. 
  
 Section 10.06. Notices. All demands, notices and communications hereunder shall be in writing and shall be deemed to have been duly given when
delivered to (i) in the case of the Master Servicer, Accredited Home Lenders, Inc., 15090 Avenue of Science, San Diego, California 92128, Attention: Director of Operations with a copy to General Counsel; (ii) in the case of the Backup Servicer,
Countrywide Home Loans Servicing LP, 7105 Corporate Drive, Plano, Texas 75024, Attention: Accredited Mortgage Loan Trust 2004-1; (iii) in the case of the Trust, Accredited Mortgage Loan Trust 2004-1, c/o the Owner Trustee at its Corporate Trust
Office, Attention: Corporate Trust Administration; (iv) in the case of the Indenture Trustee, Deutsche Bank National Trust Company, 1761 East St. Andrew Place, Santa Ana, California 92705-4934, Attention: Trust Administration - AC0401; (v) in the
case of the Sponsor, Accredited Home Lenders, Inc., 15090 Avenue of Science, San Diego, California 92128, Attention: Investor Reporting; (vi) in the case of the Underwriter, Morgan Stanley, 1585 
  

 58 

 Broadway, New York, New York 10036, Attention: Steve Shapiro; (vii) in the case of the Note Insurer, Ambac Assurance
Corporation, One State Street Plaza, New York, New York 10004, Attention: Jeff Nabi (in each case in which notice or other communication to the Note Insurer refers to an Event of Default, a Servicer Event of Default or a claim on the Note Insurance
Policy or with respect to which failure on the part of the Note Insurer to respond shall be deemed to constitute consent or acceptance, then a copy of such notice or other communication should also be sent to the attention of the General Counsel and
shall be marked to indicate “URGENT MATERIAL ENCLOSED”); (viii) in the case of Standard & Poor’s Rating Services, 55 Water Street, New York, New York 10004, Attention: Residential Mortgage Surveillance Group; (ix) in the case of
Moody’s Investors Service, Inc., 99 Church Street, New York, New York 10007, Attention: Keith Wofford; (x) in the case of the Seller, Accredited Home Capital, Inc., 15092 Avenue of Science, San Diego, California 92128, Attention: General
Counsel and (xi) in the case of the Noteholders, as set forth in the Note Register. Any such notices shall be deemed to be effective with respect to any party hereto upon the receipt of such notice by such party, except that notices to the
Noteholders shall be effective upon mailing or personal delivery. 
  
 Section 10.07. Severability of Provisions. If any one or more of the covenants, agreements, provisions or terms of this Agreement shall be held invalid for any reason whatsoever, 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 covenants, agreements, provisions or terms of this Agreement.

  
 Section 10.08. No Partnership. Nothing herein contained
shall be deemed or construed to create a co-partnership or joint venture between the parties hereto and the services of the Master Servicer shall be rendered as an independent contractor and not as agent for the Noteholders. 
  
 Section 10.09. Counterparts. This Agreement 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 agreement. 
  
 Section 10.10. Successors and Assigns. This Agreement shall inure to
the benefit of and be binding upon the Trust, the Master Servicer, the Backup Servicer, the Seller, the Sponsor, the Indenture Trustee and the Noteholders and their respective successors and permitted assigns. 
  
 Section 10.11. Headings. The headings of the various sections of this
Agreement have been inserted for convenience of reference only and shall not be deemed to be part of this Agreement. 
  
 Section 10.12. No Petition. The Master Servicer and the Backup Servicer, by entering into this Agreement hereby covenant and agree, and the
Noteholders, by the acceptance of their Notes are deemed to covenant and agree, that they will not at any time institute against the Trust, or join in any institution against the Trust of, any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings, or other proceedings under any United States Federal or state bankruptcy law in connection with any obligations relating to the Certificates, the Notes, this Agreement or any of the other Basic Documents. 
  

 59 

 This Section 10.12 will survive for one year and one day following the termination of this Agreement.

  
 Section 10.13. Third Party Beneficiary. The parties
agree that each of the Owner Trustee and the Note Insurer is intended and shall have all rights of a third-party beneficiary of this Agreement. Without limiting the generality of the foregoing, all covenants and agreements in this Agreement that
expressly confer rights upon the Note Insurer shall be for the benefit of and run directly to the Note Insurer, and the Note Insurer shall be entitled to rely on and enforce such covenants to the same extent as if it were a party to this Agreement.

  
 Section 10.14. Intent of the Parties. It is the intent
of the parties hereto and Noteholders that, for federal income taxes, state and local income or franchise taxes and other taxes imposed on or measured by income, the Notes be treated as debt. The parties to this Agreement and the Holder of each
Note, by acceptance of its Note, and each Beneficial Owner thereof, agree to treat, and to take no action inconsistent with the treatment of, the related Notes in accordance with the preceding sentence for purposes of federal income taxes, state and
local income and franchise taxes and other taxes imposed on or measured by income. 
  
 Section 10.15. GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL. (a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS (AS OPPOSED TO CONFLICT OF LAWS
PROVISIONS) OF THE STATE OF NEW YORK. 
  
 (b) THE TRUST, THE
MASTER SERVICER, THE SELLER, THE SPONSOR, THE BACKUP SERVICER AND THE INDENTURE TRUSTEE HEREBY SUBMIT TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND THE UNITED STATES DISTRICT COURT LOCATED IN THE BOROUGH OF MANHATTAN
IN NEW YORK CITY, AND EACH WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS UPON IT AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS BE MADE BY REGISTERED MAIL DIRECTED TO THE ADDRESS SET FORTH IN SECTION 10.06 HEREOF AND SERVICE SO MADE SHALL BE DEEMED
TO BE COMPLETED FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN DEPOSITED IN THE U.S. MAILS, POSTAGE PREPAID. THE TRUST, THE SELLER, THE SPONSOR, THE MASTER SERVICER, THE BACKUP SERVICER AND THE INDENTURE TRUSTEE EACH HEREBY WAIVE ANY OBJECTION BASED
ON FORUM NON CONVENIENS, AND ANY OBJECTION TO VENUE OF ANY ACTION INSTITUTED HEREUNDER AND CONSENTS TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY THE COURT. NOTHING IN THIS SECTION 10.15 SHALL AFFECT THE RIGHT OF THE
TRUST, THE SELLER, THE SPONSOR, THE MASTER SERVICER, THE BACKUP SERVICER OR THE INDENTURE TRUSTEE TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR AFFECT ANY OF THEIR RIGHTS TO BRING ANY ACTION OR PROCEEDING IN THE COURTS OF ANY OTHER
JURISDICTION. 
  

 60 

 (c) THE TRUST, THE SELLER, THE SPONSOR, THE MASTER SERVICER, THE BACKUP SERVICER AND THE INDENTURE
TRUSTEE EACH HEREBY WAIVES ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE ARISING OUT OF, CONNECTED WITH, RELATED TO, OR IN CONNECTION WITH THIS AGREEMENT. INSTEAD, ANY DISPUTE WILL BE
RESOLVED IN A BENCH TRIAL WITHOUT A JURY. 
  
 [Remainder of Page
Intentionally Left Blank] 
  

 61 

 IN WITNESS WHEREOF, the Master Servicer, the Backup Servicer, the Trust, the Indenture Trustee, the
Seller and the Sponsor have caused their names to be signed hereto by their respective officers thereunto duly authorized as of the day and year first above written. 
  

					
	 ACCREDITED HOME LENDERS, INC.,
as Sponsor and Master Servicer

		
	 By:
	 	 /s/    John S.
Buchanan        

	 	 	 Name:
	 	 John S. Buchanan

	 	 	 Title:
	 	 Chief Financial Officer

	
	 ACCREDITED MORTGAGE LOAN TRUST 2004-1

		
	 By:
	 	U.S. BANK TRUST NATIONAL ASSOCIATION, not in its individual capacity, but solely as Owner Trustee under the Trust Agreement
			
	 	 	 By:
	 	 /s/    Patricia M.
Child        

	 	 	 Name:
	 	 Patricia M. Child

	 	 	 Title:
	 	 Vice President

	
	 ACCREDITED HOME CAPITAL, INC.,
as Seller

		
	 By:
	 	 /s/    David E.
Hertzel        

	 	 	 Name:
	 	 David E. Hertzel

	 	 	 Title:
	 	 GIC, AVP & Ass’t Sec’y

	
	 DEUTSCHE BANK NATIONAL TRUST COMPANY,
as Indenture Trustee

		
	 By:
	 	 /s/    Barbara
Campbell        

	 	 	 Name:
	 	 Barbara Campbell

	 	 	 Title:
	 	 Assistant Vice President

		
	 By:
	 	 /s/    ROnaldo
Reyes        

	 	 	 Name:
	 	 Ronaldo Reyes

	 	 	 Title:
	 	 Assistant Vice President

  

 62 

			
	 COUNTRYWIDE HOME LOANS SERVICING LP,
as Backup Servicer

		
	 By:
	 	 /s/    Kevin L. Meyers

	 	 	 Name: Kevin L. Meyers

	 	 	 Title: Executive Vice President

  
 [Signature Page
to Sale and Servicing Agreement] 
  

 63 

 SCHEDULE I 
  
 MORTGAGE LOAN SCHEDULE 
  
 [On File with Dewey Ballantine LLP] 
  

 A-1 

 APPENDIX I 
  
 DEFINED TERMS 
  
 [See Appendix I to Indenture] 

 EXHIBIT A 
  
 CONTENTS OF THE MORTGAGE FILE 
  
 With respect to each Mortgage Loan, the Mortgage File shall include each of the following items (copies to the extent the originals have been delivered to
the Indenture Trustee for the benefit of the Noteholders and the Note Insurer, pursuant to Section 2.05 of the Sale and Servicing Agreement), all of which shall be available for inspection by the Noteholders, to the extent required by applicable
laws: 
  
 1. the original Mortgage Note, endorsed without
recourse in blank from the last endorsee thereof, including all intervening endorsements showing a complete chain of endorsement; 
  
 2. the related original Mortgage with evidence of recording indicated thereon or a copy thereof certified by the applicable recording office and if the
Mortgage Loan is registered on the MERS System, such Mortgage or an assignment of the Mortgage shall reflect MERS as the mortgagee of record and shall include the MIN for such Mortgage Loan; 
  
 3. each intervening mortgage assignment, with evidence of recording indicated
thereon or if the original is not available, a copy thereof certified by the applicable recording office, if any, showing a complete chain of assignment from the last assignee thereof of the related Mortgage Loan to the Sponsor (or to MERS, if the
Mortgage Loan is registered on the MERS System), and noting the presence of a MIN (if the Mortgage Loan is registered on the MERS System) (which assignment may, at the Sponsor’s option, be combined with the assignment referred to in subpart (4)
hereof, in which case it must be in recordable form, but need not have been previously recorded); 
  
 4. Unless the Mortgage Loan is recorded on the MERS System, a mortgage assignment in recordable form (which, if acceptable for recording in the relevant
jurisdiction as evidenced by an Opinion of Counsel addressed to the Indenture Trustee, may be included in a blanket assignment or assignments) of each Mortgage from the Sponsor to the Indenture Trustee; 
  
 5. originals of all assumption, modification and substitution agreements in
those instances where the terms or provisions of a Mortgage or Mortgage Note have been modified or such Mortgage or Mortgage Note has been assumed (if any); and 
  

6. an original title insurance policy or title opinion (or (A) a copy of the title insurance policy or title opinion, or (B) the related binder,
commitment or preliminary report, or copy thereof in which case the Sponsor hereby certifies that the original Mortgage has been delivered to the title insurance company that issued such binder, commitment or preliminary report). 
  

 A-1 

 In instances where the original recorded Mortgage or any intervening mortgage assignment or a completed
assignment of the Mortgage in recordable form cannot be delivered by the Sponsor to the Indenture Trustee prior to or concurrently with the execution and delivery of this Agreement, due to a delay in connection with recording, the Sponsor may:

  
 (a) with respect to item (3) above, in lieu of delivering
such original recorded Mortgage or intervening mortgage assignment, deliver to the Indenture Trustee, a copy thereof; provided, that the Sponsor certifies that the original Mortgage has been delivered to a title insurance company for recordation
after receipt of its policy of title insurance or the related binder, commitment or preliminary report; and 
  
 (b) in lieu of delivering the completed assignment in recordable form, deliver to the Indenture Trustee, the assignment in recordable form, otherwise
complete except for recording information. 
  

 A-2 

 EXHIBIT B 
  

INDENTURE TRUSTEE’S ACKNOWLEDGMENT OF RECEIPT 
  

			
	 	  	                                February 19, 2004
		
	 Lehman Brothers Inc.
 745 Seventh Avenue
 New York, New York 10019
	  	 Accredited Home Lenders, Inc.
 15090 Avenue of
Science
 San Diego, California 92128

		
	 Countrywide Home Loans Servicing LP
 4500 Park Granada,
Mail Stop CH-143,
 Calabasas, California 91302
	  	 Ambac Assurance Corporation
 One State Street
Plaza
 New York, New York 10022

		
	 Accredited Home Capital, Inc.
 15092 Avenue of
Science
 San Diego, California 92128
	  	 

  

	 	Re:	Sale and Servicing Agreement, dated as of February 1, 2004 among Accredited Home Lenders, Inc., as Sponsor and Master Servicer, Accredited Home Capital, Inc., as seller, Accredited
Mortgage Loan Trust 2004-1, Countrywide Home Loans Servicing LP, as Backup Servicer, and Deutsche Bank National Trust Company, as Indenture Trustee 

  
 Ladies and Gentlemen: 
  
 In accordance with Section 2.06(a) of the above-captioned Sale and Servicing Agreement, the undersigned, as Indenture Trustee, hereby acknowledges receipt
by it in good faith without notice of adverse claims, of the Note Insurance Policy and declares that it holds and will hold such Note Insurance Policy in trust for the exclusive use and benefit of all present and future Noteholders pursuant to the
terms of the Indenture dated as of February 1, 2004, by and between Accredited Mortgage Loan Trust 2004-1 and the Indenture Trustee. 
  
 Capitalized words and phrases used herein shall have the respective meanings assigned to them in Appendix I to the Indenture. 
  

			
	DEUTSCHE BANK NATIONAL TRUST COMPANY,
as Indenture Trustee
		
	 By:
	 	  

	 	 	 Name:

	 	 	 Title:

  

 B-1 

 Exhibit C 
  

INDENTURE TRUSTEE’S ACKNOWLEDGEMENT OF RECEIPT 
  

			
	 	  	                                    February 19,
2004
		
	 Lehman Brothers Inc.
 745 Seventh Avenue
 New York, New York 10019
	  	 Accredited Home Lenders, Inc.
 15090 Avenue of
Science
 San Diego, California 92128

		
	 Countrywide Home Loans Servicing LP
 4500 Park Granada,
Mail Stop CH-143,
 Calabasas, California 91302
	  	 Ambac Assurance Corporation
 One State Street
Plaza
 New York, New York 10022

		
	 Accredited Home Capital, Inc.
 15092 Avenue of
Science
 San Diego, California 92128
	  	 

  

	 	Re:	Sale and Servicing Agreement, dated as of February 1, 2004 among Accredited Home Lenders, Inc., as Sponsor and Master Servicer, Accredited Home Capital, Inc., as seller, Accredited
Mortgage Loan Trust 2004-1, Countrywide Home Loans Servicing LP, as Backup Servicer, and Deutsche Bank National Trust Company, as Indenture Trustee 

  
 Ladies and Gentlemen: 
  
 In accordance with Section 2.06(b)(i) of the above-captioned Sale and Servicing Agreement, the undersigned, as Indenture Trustee, hereby acknowledges
receipt by it in good faith without notice of adverse claims, subject to the provisions of Sections 2.04 and 2.05 of the Sale and Servicing Agreement (as such provisions relate to the Mortgage Loan), of, with respect to each Mortgage Loan, a
Mortgage File containing the original Mortgage Note, except with respect to the list of exceptions attached hereto, and based on its examination and only as to the foregoing, the information set forth in items (i), (ii) (with respect to property
address only, excluding zip code), (iii) and (vi) of the definition of the “Mortgage Loan Schedule” accurately reflects information set forth in the Mortgage Note, and declares that it holds and will hold such documents and the other
documents delivered to it constituting the Indenture Trustee’s Mortgage Files, and that it holds or will hold all such assets and such other assets included in the definition of “Trust Estate” that are delivered to it for the
exclusive use and benefit of all present and future Noteholders and the Note Insurer. 

 The Indenture Trustee has made no independent examination of any such documents beyond the review
specifically required in the above-referenced Sale and Servicing Agreement. The Indenture Trustee makes no representations as to: (i) the validity, legality, recordability, sufficiency, perfection, priority, enforceability or genuineness of any such
documents or any of the Mortgage Loans identified on the Mortgage Loan Schedule, or (ii) the collectability, insurability, effectiveness or suitability of any such Mortgage Loan. 
  
 The Mortgage Loan Schedule is attached to this Receipt. 
  
 Capitalized words and phrases used herein shall have the respective meanings assigned to them in Appendix I to the
Indenture, dated as of February 1, 2004, by and between Accredited Mortgage Loan Trust 2004-1 and the Indenture Trustee. 
  

			
	 DEUTSCHE BANK NATIONAL TRUST COMPANY,
 as Indenture Trustee

		
	 By:
	 	  

	 	 	 Name:

	 	 	 Title:

 EXHIBIT D 
  

INITIAL CERTIFICATION OF INDENTURE TRUSTEE 
  

			
	 	  	                                      
      , 2004
		
	 Lehman Brothers Inc.
 745 Seventh Avenue
 New York, New York 10019
	  	 Accredited Home Lenders, Inc.
 15090 Avenue of
Science
 San Diego, California 92128

		
	 Countrywide Home Loans Servicing LP,
 as Backup
Servicer
 4500 Park Granada, Mail Stop CH-143,
 Calabasas,
California 91302
	  	 Ambac Assurance Corporation
 One State Street
Plaza
 New York, New York 10022

		
	 Accredited Home Capital, Inc.
 15092 Avenue of
Science
 San Diego, California 92128
	  	 

  

	 	Re:	Sale and Servicing Agreement, dated as of February 1, 2004 among Accredited Home Lenders, Inc., as Sponsor and Master Servicer, Accredited Home Capital, Inc., as seller, Accredited
Mortgage Loan Trust 2004-1, Countrywide Home Loans Servicing LP, as Backup Servicer, and Deutsche Bank National Trust Company, as Indenture Trustee 

  
 Ladies and Gentlemen: 
  
 In accordance with the provisions of Section 2.06(b)(ii) of the above-referenced Sale and Servicing Agreement, the undersigned, as Indenture Trustee,
hereby certifies that as to each Mortgage Loan listed in the Mortgage Loan Schedule (other than any Mortgage Loan paid in full or any Mortgage Loan listed on the attachment hereto), it has reviewed the documents delivered to it pursuant to Section
2.05(a) of the Sale and Servicing Agreement and has determined that, except as noted on the attachment hereto, (i) all documents required to be delivered to it pursuant to Section 2.05(a)(i)-(iv) and (vi) of the above-referenced Sale and Servicing
Agreement are in its possession, (ii) such documents have been reviewed by it and appear regular on their face and have not been mutilated, damaged, torn or otherwise physically altered (handwritten additions, changes or corrections do not
constitute physical alteration if they reasonably appear to have been initialed by the Mortgagor) and relates to such Mortgage Loan and (iii) based on its examination and only as to the foregoing documents, the information set forth in the Mortgage
Loan Schedule as to the information in clauses (i), (ii) (with respect to property address only, excluding zip code), (iii) and (vi) of the definition of “Mortgage Loan Schedule” respecting such Mortgage Loan accurately reflects the
information set forth in Indenture Trustee’s Mortgage 
  

 D-1 

 File. The Indenture Trustee has made no independent examination of such documents beyond the review specifically required
in the above-referenced Sale and Servicing Agreement. The Indenture Trustee makes no representations as to: (x) the validity, legality, recordability, sufficiency, perfection, priority, enforceability or genuineness of any such documents contained
in each or any of the Mortgage Loans identified on the Mortgage Loan Schedule, or (y) the collectability, insurability, effectiveness or suitability of any such Mortgage Loan. 
  
 Capitalized words and phrases used herein shall have the respective meanings assigned to them in the above-captioned Sale
and Servicing Agreement. 
  

			
	 DEUTSCHE BANK NATIONAL TRUST COMPANY,
 as Indenture Trustee

		
	 By:
	 	  

	 	 	 Name:

	 	 	 Title:

  

 D-2 

 EXHIBIT E 
  

FINAL CERTIFICATION OF INDENTURE TRUSTEE 
  
  

			
	 	 	             , 2004

		
	 Lehman Brothers Inc.
 745 Seventh Avenue
 New York, New York 10019
	 	 Accredited Home Lenders, Inc.
 15090 Avenue of Science
 San Diego, California 92128

		
	 Countrywide Home Loans Servicing LP,
 as Backup Servicer
 4500 Park Granada, Mail Stop CH-143,
 Calabasas, California 91302
	 	 Ambac Assurance Corporation
 One State Street Plaza
 New York, New York 10022

		
	 Accredited Home Capital, Inc.
 15092 Avenue of Science
 San Diego, California 92128
	 	 

  

	 	Re:	Sale and Servicing Agreement, dated as of February 1, 2004 among Accredited Home Lenders, Inc., as Sponsor and Master Servicer, Accredited Home Capital, Inc., as seller, Accredited
Mortgage Loan Trust 2004-1, Countrywide Home Loans Servicing LP, as Backup Servicer, and Deutsche Bank National Trust Company, as Indenture Trustee 

  
 Ladies and Gentlemen: 
  
 In accordance with the provisions of Section 2.06(b)(iii) of the above-referenced Sale and Servicing Agreement, the undersigned, as Indenture Trustee,
hereby certifies that as to each Mortgage Loan listed in the Mortgage Loan Schedule (other than any Mortgage Loan paid in full or any Mortgage Loan listed on the attachment hereto), it has reviewed the documents delivered to it pursuant to Section
2.05(a) of the Sale and Servicing Agreement and has determined that (i) all documents required to be delivered to it pursuant to Section 2.05(a)(i)-(iv) and (vi) of the above referenced Sale and Servicing Agreement are in its possession, (ii) such
documents have been reviewed by it and appear regular on their face and have not been mutilated, damaged, torn or otherwise physically altered (handwritten additions, changes or corrections do not constitute physical alteration if they reasonably
appear to have been initialed by the Mortgagor) and relates to such Mortgage Loan and (iii) based on its examination and only as to the foregoing documents, the information set forth in items (i), (ii) (with respect to property address only,
excluding zip code), (iii) and (vi) of the definition of the Mortgage Loan Schedule respecting 
  

 E-1 

 such Mortgage Loan that can be determined from the face of such documents accurately reflects the information set forth
in the Indenture Trustee’s Mortgage File. The Indenture Trustee has made no independent examination of such documents beyond the review specifically required in the above-referenced Sale and Servicing Agreement. The Indenture Trustee makes no
representations as to: (x) the validity, legality, recordability, sufficiency, perfection, priority, enforceability or genuineness of any such documents contained in each or any of the Mortgage Loans identified on the Mortgage Loan Schedule, or (y)
the collectability, insurability, effectiveness or suitability of any such Mortgage Loan. 
  
 Capitalized words and phrases used herein shall have the respective meanings assigned to them in the above-captioned Sale and Servicing Agreement. 
  

					
	 DEUTSCHE BANK NATIONAL TRUST COMPANY,
 as Indenture Trustee

		
	 By:
	 	  

	 	 	 Name:
	 	 
	 	 	 Title:
	 	 

  

 E-2 

 EXHIBIT F 
  

REQUEST FOR RELEASE OF DOCUMENTS 
  

							
	To:	 	 Deutsche Bank National Trust Company
 1761
East St. Andrew Place
 Santa Ana, California 92705
 Attention:
Trust Administration -AC0401
	  	 
				
	 	 	Re:	  	Sale and Servicing Agreement, dated as of February 1, 2004 among Accredited Home Lenders, Inc., as Sponsor and Master Servicer, Accredited Home Capital, Inc., as seller, Accredited Mortgage
Loan Trust 2004-1, Countrywide Home Loans Servicing LP, as Backup Servicer, and Deutsche Bank National Trust Company, as Indenture Trustee (“Custodian/Indenture Trustee”)	  	 

  
 In connection with the
administration of the Mortgage Loans held by you as Indenture Trustee for the Issuer pursuant to the above-captioned Sale and Servicing Agreement, we request the release, and hereby acknowledge receipt, of the Indenture Trustee’s Mortgage File
for the Mortgage Loan described below, for the reason indicated. 
  
 Mortgage
Loan Number: 
  
 Mortgagor Name, Address & Zip Code: 
  
 Reason for Requesting Documents (check one): 
  

							
	           
	  	1.	  	 Mortgage Paid in Full
	 	 
				
	           
	  	2.	  	 Foreclosure
	 	 
				
	           
	  	3.	  	 Substitution
	 	 
				
	           
	  	4.	  	 Other Liquidation (Repurchases, etc.)
	 	 
				
	           
	  	5.	  	 Nonliquidation Reason:
	 	             Reason:                         
                                      
 

			
	 	  	Address to which Indenture Trustee should	 	 

  
  

			
	 Deliver the Mortgage File:
	 	                                       
                                        
            

		
	 	 	                                       
                                        
            

		
	 	 	                                       
                                        
            

  
  

			
	 By:
	 	  

	 	 	(authorized signer)
		
	 Issuer:
	 	  

	 Address:
	 	  

	 	 	  

		
	 Date:
	 	  

 EXHIBIT G 
  

ACCREDITED HOME LENDERS, INC. 
 OFFICER’S CERTIFICATE 
  
 I,
                    , certify that: 
  

	1.	I have reviewed this annual report on Form 10-K, and all reports on Form 8-K containing distribution or servicing reports filed in respect of periods included in the year covered by
this annual report, of Accredited Mortgage Loan Trust 2004-1; 

  

	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 distribution or servicing information required to be provided to the trustee by the servicer under the pooling and servicing, or similar, agreement is
included in these reports; 

  

	4.	Based on my knowledge and upon the annual compliance statement included in the report and required to be delivered to the trustee in accordance with the terms of the pooling and
servicing, or similar, agreement, and except as disclosed in the reports, the servicer has fulfilled its obligations under the servicing agreement; and 

  

	5.	The reports disclose all significant deficiencies relating to the servicer’s 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 or similar procedure, as set forth in the pooling and servicing, or similar, agreement that is included in these reports.

  
 In giving the certifications above, I have reasonably relied on
information provided to me by the following unaffiliated parties:                     . 
  

	
	 Date:

	  

	 Name:

	 Title:

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